Summary
holding that even though the tenant vacated the apartment, the appeal was not moot
Summary of this case from Marshall v. Housing Auth. City San AntonioOpinion
No. 10-01-275-CV.
Opinion delivered and filed February 18, 2004.
Appeal from the County Court at Law No. 1, McLennan County, Texas, Trial Court # 20010197 CV1.
Affirmed.
Timothy S. Corwin — Waco for Appellant/Relator.
David C. Sander, Scanlan, Buckle Young, P.C. — Austin; Steven L. Moody; Naman, Howell, Smith Lee, P.C. — Waco for Appellee/Respondent.
MEMORANDUM OPINION
The issue in this forcible-entry-and-detainer appeal is possession of an apartment. After trial, the justice court awarded possession to the tenant, Wayne Coughran, and the apartment owner, Saddle Brook, appealed to the county court at law. After a bench trial, the county court at law awarded possession to Saddle Brook and taxed Coughran $310 in costs and $1,500 in attorney's fees.
In two issues, Coughran broadly asserts that the findings of fact and conclusions of law "are not supported by the evidence." In a third he contends that the court should have found that Saddle Brook was bound by a lease agreement he signed (the "renewal lease"). In a fourth issue, he contends that Saddle Brook was estopped to assert the invalidity of the renewal lease. Although we confess to some difficulty in understanding his approach to these issues, taken together they make clear that Coughran's complaint is: the renewal lease was valid and should have controlled the rental rate he was charged, and the court erred in determining otherwise. Saddle Brook responds that the court correctly determined that the holdover provision of an earlier lease controls the rights of the parties.
We initially inquired of the parties whether this cause became moot when Coughran vacated the apartment. We have concluded that it is not moot. Pinnacle Gas Treating, Inc. v. Read, 104 S.W.3d 544, 545-46 (Tex. 2003).
The Lease
Coughran had a lease (the "original lease") with Saddle Brook prior to December 31, 2000, which expired by its terms on that date, at a monthly rental of $690. On September 5, 2000, Saddle Brook, acting through its manager, Trish McLean, notified Coughran in writing that the original lease was about to expire. It offered a renewal for one year at $730 per month or six months at $780 per month, pointing out that in the absence of a renewal the terms of the original lease would continue on a "month-to-month" basis at $995 per month.
McLean prepared the renewal lease and submitted it to Coughran, who signed it but modified it by adding the word "ambiguous" by one provision and the words "contradictory" and "ambiguous" to the page containing an "Addendum to Lease Contract." On December 29, 2000, McLean notified Coughran that the renewal lease was not acceptable to Saddle Brook because it had been altered. She gave him until January 7, 2001, to sign a new lease to avoid the month-to-month rental amount under the holdover provision of the original lease. He did not respond. On January 10, she notified him that the month-to-month rate had taken effect and that he was delinquent in the rent for January. Another Saddle Brook employee, Annie Gibbs, delivered a notice to vacate to Coughran.
Coughran, however, says that he paid $480 ($730 under a one-year term less a "discount coupon" of $250) when he signed the renewal lease on December 26, 2000. He says Saddle Brook honored the coupon — which had expired, cashed his check for $480, and on December 27 requested that he initial a paragraph of the agreement he had overlooked. Thus, Coughran contends, the renewal lease bound Saddle Brook to accept $730 as the new rate of rent beginning January 1, 2001.
Saddle Brook says the original lease expired by its own terms on December 31, 2001, its manager gave Coughran notice to vacate more than thirty days prior to expiration — as required by that lease, and it never signed the renewal lease. Coughran never tendered $995 in monthly rent to Saddle Brook after January 1, 2001, and he was provided an opportunity to sign a renewal lease that did not contain the alterations. Thus, Saddle Brook contends, the court correctly awarded it possession of the apartment because Coughran was delinquent in the payment of rent under the month-to-month provision of the original lease.
Was the Renewal Lease Valid?
Coughran's issues all revolve around his contention that the renewal lease was binding on Saddle Brook, even though it never signed the document. He asserts that the court's findings and conclusions are "not supported by the evidence." After making extensive findings that support the judgment, the court declined to adopt proposed findings submitted by Coughran that would support a conclusion that the renewal lease was binding. This refusal forms the essence of his argument on appeal, because absent an effective renewal lease, the holdover provisions of the original lease bound him to pay $995 per month. Thus, we will address all of his contentions while noting that the burden of establishing the validity of the renewal lease was his.
Findings of fact entered in a case tried to the bench have the same force and dignity as a jury's answers to jury questions. See Anderson v. City of Seven Points, 806 S.W.2d 791, 794 (Tex. 1991). In evaluating a claim regarding sufficiency of the evidence, the same standard is used for a bench trial as for a jury trial. Hitzelberger v. Samedan Oil Corp., 948 S.W.2d 497, 503 (Tex. App.-Waco 1997, pet. denied) (citing Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex. 1996)).
Because Coughran is attacking a refusal to find facts on which he had the burden of proof, we will treat the "no-evidence" issues as asserting that the facts were established as a matter of law. See Sterner v. Marathon Oil Co., 767 S.W.2d 686, 690 (Tex. 1989); see also Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983). When a court refuses to find facts that the party having the burden of proof contends were conclusively established, i.e., the finding was established as a matter of law, the reviewing court must first examine the record for evidence that supports the refusal to find, while ignoring all evidence to the contrary. See Sterner, 767 S.W.2d at 690; Holley v. Watts, 629 S.W.2d 694, 696 (Tex. 1982). If we find evidence that supports the negative answer, the inquiry ends; but if we find no evidence to support the answer, then the entire record must be examined to determine if the contrary proposition is established as a matter of law. See id. If so, the issue will be sustained.
If that party raises a "contrary to the great weight and preponderance of the evidence" issue, i.e., asserts that the failure to affirmatively find is contrary to the evidence, the reviewing court must sustain the failure to find unless, considering all the evidence, that failure is contrary to the great weight and preponderance of the evidence. Ames v. Ames, 776 S.W.2d 154, 158 (Tex. 1989) (citing Cropper v. Caterpillar Tractor Co., 754 S.W.2d 646, 651 (Tex. 1988)).
As Saddle Brook points out, there is evidence that McLean had no authority to accept a modified lease agreement, that modifications had to be approved by Saddle Brook's Dallas office, and that Coughran knew it. He was advised prior to the expiration date of the original lease that the renewal lease was not in acceptable form. He was given until January 7 to sign an unmodified version of the renewal lease. We find evidence to support the court's failure to make Coughran's proposed findings, which would have led to the conclusion that the renewal lease was binding on Saddle Brook. Finding evidence that supports the refusal to find, the inquiry ends and the "no-evidence" issue fails. See Sterner, 767 S.W.2d at 690; Holley, 629 S.W.2d at 696. Considering all of the evidence, we do not believe that the failure to find is contrary to the great weight and preponderance of the evidence. Ames, 776 S.W.2d at 158.
In issue three, Coughran specifically contends that, because Saddle Brook accepted benefits under the renewal lease when it honored the coupon and cashed his $480 check, it became bound by that lease. He cites Orgain v. Butler, a landlord-tenant dispute, in support of this proposition. Orgain v. Butler, 478 S.W.2d 610 (Tex. App.-Austin 1972, no writ). He tendered a finding of fact to the trial judge, which was rejected. Applying the same standards outlined above, we do not believe that he conclusively proved that Saddle Brook acquiesced in the terms of the renewal lease, particularly in light of the fact that it notified him of its non-acceptance prior to the effective date of the renewal lease. See Sterner, 767 S.W.2d at 690. Nor do we find that the court's refusal to find an acceptance of benefits to be against the great weight and preponderance of the evidence. Ames, 776 S.W.2d at 158.
In a final issue, Coughran specially contends that under Theriot v. Smith, Saddle Brook should be estopped to deny the validity of the renewal lease because its acts, representations, or silence caused him to believe that the renewal lease was in effect. Theriot v. Smith, 263 S.W.2d 181 (Tex.Civ.App.-Waco 1953, writ dism'd). To establish an estoppel, he relies on the same acceptance of benefits under the renewal lease and a further claim that McLean was silent when she could have informed him that the lease was not acceptable. Theriot essentially holds that the facts presented were sufficient for the case to be presented to a jury and the court erred in rendering a take-nothing judgment. Id. Here, the fact finder refused to find that Saddle Brook accepted a benefit under the renewal lease or that McLean failed to inform Coughran on two occasions that the lease was not final until accepted by someone other than herself. Again applying the standards outlined above, we do not believe that the evidence conclusively establishes those facts or that the court's refusal to find those facts was against the great weight and preponderance of the evidence. Sterner, 767 S.W.2d at 690; Ames, 776 S.W.2d at 158.
We overrule all of Coughran's issues.
Conclusion
We affirm the judgment.
We not only miss the mark in this case, we go far beyond what we need to hold to resolve this case, thereby potentially prejudicing other litigation between these same parties, and compound the complexity of this area of law. To fully understand why our discussion is too broad, a general understanding of the very limited purpose of a forcible detainer action is necessary. Justice Sue LaGarde provided such a discussion and analysis in Rice v. Pinney. Rice v. Pinney, 51 S.W.3d 705, 709-712 (Tex. App.-Dallas 2001, no pet.). In Rice, Justice LaGarde reviews at length the nature of a forcible detainer action, or an FED, as it is commonly referred to in practice. I find no fault with her extensive analysis and quote from it at length.
My apologies to Justice LaGarde for being unable to avoid muddying the waters that she worked so hard to clarify. This is my effort to explain to the practitioner why the opening paragraph of this court's opinion, which would be unnecessary if it was right, is, in fact, wrong.
Nature of a Forcible Detainer Action
The procedure to determine the right to immediate possession of real property, if there was no unlawful entry, is the action of forcible detainer. Kennedy v. Highland Hills Apartments, 905 S.W.2d 325, 326 (Tex. App.-Dallas 1995, no writ). A forcible detainer action is a special proceeding governed by particular statutes and rules. Id. It was created to provide a speedy, simple, and inexpensive means for resolving the question of the right to possession of premises. Id. To preserve the simplicity and speedy nature of the remedy, the applicable rule of civil procedure provides that "the only issue shall be as to the right to actual possession; and the merits of the title shall not be adjudicated." TEX. R. CIV. P. 746; see Johnson v. Fellowship Baptist Church, 627 S.W.2d 203, 204 (Tex. App.-Corpus Christi 1981, no writ). Thus, the sole issue in a forcible detainer suit is who has the right to immediate possession of the premises. Fandey v. Lee, 880 S.W.2d 164, 168 (Tex. App.-El Paso 1994, writ denied); Cuellar v. Martinez, 625 S.W.2d 3, 5 (Tex. Civ. App.-San Antonio 1981, no writ); Johnson v. Highland Hills Drive Apartments, 552 S.W.2d 493, 495 (Tex.Civ.App.-Dallas 1977), writ ref'd n.r.e. per curiam, 568 S.W.2d 661 (Tex. 1978).
To prevail in a forcible detainer action, a plaintiff is not required to prove title, but is only required to show sufficient evidence of ownership to demonstrate a superior right to immediate possession. Goggins, 849 S.W.2d at 377. However, where the right to immediate possession necessarily requires resolution of a title dispute, the justice court has no jurisdiction to enter a judgment and may be enjoined from doing so. Haith v. Drake, 596 S.W.2d 194, 196 (Tex.Civ.App.-Houston [1st Dist.] 1980, writ ref'd n.r.e.); see also Rodriguez v. Sullivan, 484 S.W.2d 592, 593 (Tex.Civ.App.-El Paso 1972, no writ) (justice court judgment void when possession depended on whether defendant complied with contract for deed); Am. Spiritualist Ass'n v. Ravkind, 313 S.W.2d 121, 124 (Tex.Civ.App.-Dallas 1958, writ ref'd n.r.e.) (same). Because a forcible detainer action is not exclusive, but cumulative, of any other remedy that a party may have in the courts of this state, the displaced party is entitled to bring a separate suit in the district court to determine the question of title. Scott v. Hewitt, 127 Tex. 31, 35, 90 S.W.2d 816, 818-19 (1936); Ramirez, 600 S.W.2d at 913; Martinez v. Beasley, 572 S.W.2d 83, 85 (Tex.Civ.App.-Corpus Christi 1978, no writ). Forcible detainer actions in justice courts may be brought and prosecuted concurrently with suits to try title in district court. Haith, 596 S.W.2d at 196; Hartzog v. Seeger Coal Co., 163 S.W. 1055, 1060 (Tex.Civ.App.-Dallas 1914, no writ).
Immediate Possession Determined Separately from Title
Relying exclusively on Mitchell v. Armstrong Capital Corp., 911 S.W.2d 169 (Tex. App.-Houston [1st Dist.] 1995, writ denied), the Rices argue that because their district court suit raised the issue of title to the property, they automatically removed the possession issue from the jurisdiction of the county court at law. According to the Rices, the issues of title to the property and possession of the property are inseparable, and it is unreasonable to determine possession of real estate without first determining who holds its title. We disagree.
Contrary to appellants' assertions, not only can the right to immediate possession be determined separately from the right to title in most cases, but the Texas Legislature purposely established just such a system. In Scott v. Hewitt, the supreme court was asked by certified question to determine whether a provision in a deed of trust that made a defaulted grantor a tenant at sufferance was valid and able to support a forcible detainer action. 90 S.W.2d at 818. After concluding that the provision was valid, the supreme court stated:
If [grantors] desire to attack the sale made under the deed of trust as being invalid, they may bring such suit in the district court for that purpose; but, in a suit for forcible detainer, such action is not permissible. The Legislature has expressly provided by forcible entry and detainer proceedings a summary, speedy, and inexpensive remedy for the determination of who is entitled to the possession of premises, without resorting to an action upon the title. This [forcible detainer] action allowed by law is not exclusive, but cumulative, of any other remedy that a party may have in the courts of this state.
Id. at 818-19 (emphasis supplied). Though not specifically addressing the jurisdictional issue now before us, the supreme court nevertheless expressly stated that in cases challenging the validity of a trustee deed — as in this case — the legislature contemplated concurrent actions in the district and justice courts to resolve issues of title and immediate possession, respectively.
Similarly, in Martinez v. Beasley, the appellate court was charged with determining whether a district court properly sustained a plea to its jurisdiction in a suit to cancel a trustee's deed. 572 S.W.2d at 84. The district court had concluded it was jurisdictionally barred from hearing the suit because a justice court previously awarded possession of the premises pursuant to the challenged trustee deed. In concluding the district court erred in granting the plea to its jurisdiction, the Corpus Christi Court of Appeals stated:
[A] judgment of possession in a forcible detainer action is a determination only of the right to immediate possession of the premises, and does not determine the ultimate rights of the parties to any other issue in controversy relating to the realty in question. Therefore, in this case, plaintiffs have the right to sue in the district court to determine whether the trustee's deed should be cancelled, independent of defendant's award of possession of the premises in the forcible detainer action, which determined the right to immediate possession of the premises, and nothing else. An action in forcible detainer in the justice court is one thing, and an action in the district court to determine whether a trustee's deed to the premises involved in the forcible detainer action should be set aside i[s] something else.
Id. at 85 (emphasis supplied).
Three years later, in Home Savings Ass'n v. Ramirez, the same court of appeals had to determine if a district court properly enjoined a justice court's judgment awarding possession of certain premises. (FN3) 600 S.W.2d at 912. The underlying facts in Ramirez are similar to those in this case, except for the procedural posture. In Ramirez, a note holder foreclosed on a house pursuant to a deed of trust after the homeowner defaulted on payments for repairs. The trust deed contained a provision similar to the one in this case. It provided that after a foreclosure sale, the owners or those holding under them became tenants at sufferance of the purchaser and that their refusal, after demand, to surrender possession subjected them to a forcible detainer action by the purchaser. The house was sold at a foreclosure sale. Pursuant to the deed of trust, the purchaser brought a forcible detainer action and evicted the homeowner while the homeowner's breach of contract action against the note holder was pending in district court. The homeowner brought another action in district court seeking to enjoin execution of the county court's writ of restitution. Believing the county court had exceeded its jurisdiction by trying title, the district court granted the injunction. The Corpus Christi Court of Appeals reversed and dissolved the injunction, concluding the district court had abused its discretion. Id. at 913-14. After reiterating the legislative intent for parallel and concurrent resolution of issues of immediate possession and title in different courts, the appellate court stated, "The only issue presented to the justice and county court was who was entitled to immediate possession. The appellant, as grantee in the trustee's deed, was entitled to possession." Id. at 914. Thus, the court of appeals rejected the argument that the justice and county courts exceeded their jurisdiction in awarding immediate possession based on a disputed trustee deed.
The reasoning of Ramirez is applicable to this case. Here, the county court at law had before it a March 1998 deed of trust wherein the Rices, as grantors, conveyed the property to a trustee for the benefit of NMC. The deed of trust stated that upon a sale pursuant to the deed of trust, the Rices would become tenants at sufferance and subject to a forcible detainer action if they refused to vacate the property after request. Also before the court was a September 1999 substitute trustee's foreclosure sale deed and related documents establishing the default on the note, a notice of eviction, the foreclosure pursuant to the deed of trust, and the sale of the property to Pinney. Based on this evidence, it was not necessary for the county court at law to determine the issue of title to the property, nor did it. The county court merely determined who was entitled to immediate possession. To hold, as the Rices suggest, that the filing of a concurrent suit in district court challenging the validity of the substitute trustee deed precludes a forcible detainer suit in justice court would ignore the long-established legislative scheme of parallel resolution of immediate possession and title issues.
Nevertheless, the Rices assert that Mitchell v. Armstrong Capital Corp. supports their argument. There, a homeowner signed a promissory note for improvements to her house. Mitchell, 911 S.W.2d at 170. This note was secured by a "Builder's and Mechanic's Lien Contract." When the homeowner defaulted, the note holder requested a substitute trustee post the house for foreclosure pursuant to the lien contract. After purchasing the house from the substitute trustee, the note holder filed a forcible detainer action in justice court to evict the homeowner. By written answer, the homeowner asserted the justice court lacked jurisdiction because of a pending lawsuit in district court challenging the note holder's title. The justice court awarded possession to the note holder. On trial de novo, the county court at law also awarded possession to the note holder. On appeal, the Houston First District Court of Appeals concluded the homeowner had raised a "title issue" in the courts below that deprived both the justice court and the county court at law on appeal of subject matter jurisdiction. Id. at 171.
The Rices argue this case presents "[t]he exact same set of facts [as] existed in Mitchell." Although the cases are similar, Mitchell is distinguishable in at least one material way. In Mitchell, the lien contract apparently permitted the note holder to sell the property at a foreclosure sale like the deed of trust did in this case. However, in this case the Rices agreed that a foreclosure pursuant to the deed of trust established a landlord and tenant-at-sufferance relationship between the Rices and Pinney. This landlord-tenant relationship provided an independent basis on which the trial court could determine the issue of immediate possession without resolving the issue of title to the property. There is no indication, however, that the lien contract in Mitchell created any type of landlord-tenant relationship or any other independent basis on which the trial court could decide the immediate possession issue. Because the issue of immediate possession in Mitchell depended solely upon title to the house under the terms of the note and lien contract, neither the justice court nor the county court at law on appeal had subject matter jurisdiction to issue the writ of possession. (FN4) See id. (citing Rodriguez, 484 S.W.2d at 593 and Ravkind, 313 S.W.2d at 124).
Rice v. Pinney, 51 S.W.3d 705, 709-712 (Tex. App.-Dallas 2001, no pet.) (emphasis added).
Our opinion should be strictly limited to the issue of the right to immediate possession. It is not. To the extent we go beyond the issue, we err. The court's entire opinion erroneously relies on the theory that the lease signed by Coughran was "modified." It was not. As the majority notes, Coughran marked on the lease that it was "?ambiguous?" in one place and "contradictory — ambiguous!" in another. If the marks made on the lease do not vary or amend the provisions of the lease, such that it would be a rejection of the terms as offered in the lease and would thereby constitute a counter-offer, there is no modification. The markings Coughran made on the lease form do not modify any term or provision of the agreement. He signed the lease and returned it to the manager. Coughran also tendered a check in the amount of the rental due under the new lease agreement, less a coupon discount for entering into a new lease. The check was accepted by Saddle Brook Apartments and cashed. Saddle Brook concedes that the manager has the authority to accept lease contracts that are not modified. So not only did she have apparent authority to accept the contract, she also had actual authority to accept this contract, because its terms had not been modified.
The "?Ambiguous?" mark was next to a stamp placed in the upper right hand corner of the first page of the form contract: "If resident does not walk apt. with manager upon move out, resident will pay all damage charges assessed by the manager."
The "Contradictory — Ambiguous!" mark was next to a stamp placed on the bottom of the form contract: "Addendum to Lease Contract. All notices to vacate must be given on or before the 1st day of the month regardless of whether the month has 30 or 31 days. No notices will be accepted unless lease term has expired." In all candor, I could never figure out what this meant either. But whatever it means, Coughran having written above it "contradictory and ambiguous" did not modify what it meant.
So who was entitled to immediate possession of the apartment, which is the only issue in an FED action. Saddle Brook. But only because Coughran could not present a lease agreement signed by Saddle Brook that was for the contested time period and for the lease payment he proved he had paid. The only fully executed lease presented was for the prior period. But Coughran would be holding over under that lease and had not payed the lease payment required as a holdover and had been notified to vacate under the terms of that lease. Thus Saddle Brook, without trying the issue of title to the property, established a right to immediate possession based upon the documents. That should be the basis of the opinion; but the majority attempts to resolve the title dispute and discusses issues of construction, apparent authority, and estoppel. These are not the proper subject of an FED action and are only proper discussions in an action for damages for wrongful eviction or breach of contract. An action for damages is pending and, no doubt, the cost and expense of this litigation will become part of the damages sought in that litigation. A finding of a right to immediate possession does not necessarily mean that a landlord is not liable in other causes of action relating to the FED action such as wrongful eviction or breach of contract. We should studiously avoid prejudging any other action or making holdings that could be misconstrued as affecting the decision in another proceeding between these parties. I address these other issues only because the majority does.
For example, on the issue of accepting benefits under the new lease agreement, there is no dispute between the parties. The check was tendered for payment of the new lease. It was cashed. For Saddle Brook to now argue that it did not accept benefits under the new lease is contrary to what everybody thought the payment was for. Also the evidence was that the manager told Coughran after he had paid the rent specified by the new lease, "Looks like we have you for another year," a statement that only had meaning under the new lease. Coughran was subsequently asked to initial a space that he had overlooked on the lease form when he had signed it, which the manager had him initial after she had reviewed the lease form he had signed and returned to her.
Finally, I specifically draw the reader's attention to the jurisdictional issue. I note that the issues, particularly the estoppel defense and the issue of apparent authority, cannot control the disposition of this proceeding. This case is about superior right to possession, not breach of contract or wrongful eviction. If the issues decided by the majority regarding the validity of the new lease agreement have to be decided, the trial court and this court moved from litigating the right to immediate possession, to issues of title, issues beyond the jurisdiction of a court deciding an FED, and accordingly, issues beyond our jurisdiction to resolve in this appeal of a forcible detainer action.
Accordingly, because the majority decides the appeal on issues based on the resolution of issues over which the trial court and this court have no jurisdiction, but nevertheless reaches the proper result, I respectfully concur only in affirming the judgment of the trial court.