Summary
relying on Holloman and dismissing plaintiff's claims under same statute because plaintiff “did not pay any of the alleged illegal commissions”
Summary of this case from Shanklin v. Bassoe Offshore (Usa) Inc.Opinion
CIVIL ACTION NO. 3:03-CV-0379-K
February 24, 2004
MEMORANDUM OPINION AND ORDER
Before the Court is Defendants' Motion for Summary Judgment, filed July 31, 2003. After consideration of the motion, summary judgment evidence, and the applicable law, the Court rules as follows:
I. Factual and Procedural Background
Plaintiff leases an aircraft hangar at the Addison Airport. Plaintiff originally signed his lease agreement with Defendant the Town of Addison ("Addison") on January 17, 2001 (the "2001 Lease"). He entered into a subsequent lease of the hangar for 2002 (the "2002 Lease") and a lease renewal agreement for 2003 (the "2003 Lease") (collectively, the "Leases"). Each of the Leases required Plaintiff to pay a monthly rental fee for the hangar, and additionally the 2002 and 2003 Leases require Plaintiff (at his sole cost and expense) to maintain insurance coverage relating to the leased premises and/or his aircraft. Plaintiff and Addison are the only parties to the Leases, which Plaintiff voluntarily entered into. The respective Leases obligate Plaintiff to pay Addison monthly rent through December 31, 2003. Plaintiff has paid his monthly rental to Addison.
Plaintiff filed suit against Defendants Addison, Staubach Airport Management, Inc. ("Staubach"), and Raytheon Infrastructure, Inc. ("Raytheon"), both d/b/a Washington Staubach Addison Airport Venture (the "Operator") in Texas state court on January 22, 2003. In his petition, Plaintiff challenges the validity of a contract between Addison and the Operator known as the Agreement for the Operation and Management of Addison Airport (the "Operating Agreement"), bringing claims for declaratory judgment, civil conspiracy and alleged unconstitutional takings of property. Defendants removed the case to this Court on February 21, 2003.
On July 31, 2003, Defendants filed their Motion for Summary Judgment. Plaintiff did not file a response to Defendant's Motion for Summary Judgment and requested an extension of time to do so. On December 22, 2003, the Court extended the time for Plaintiff's response to Defendants' Motion for Summary Judgment, giving Plaintiff until February 2, 2004 to file his response. Plaintiff failed to file a response by that date, and has not filed a response whatsoever.
II. Summary Judgment Standard
Summary judgment is appropriate when the pleadings, affidavits and other summary judgment evidence show that no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. FED.R.ClV.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2551 (1986). The moving party bears the burden of identifying those portions of the record it believes demonstrate the absence of a genuine issue of material fact. Celotex, 477 U.S. at 322-25, 106 S.Ct. at 2551-54. Once a movant makes a properly supported motion, the burden shifts to the nonmovant to show that summary judgment should not be granted; the nonmovant may not rest upon allegations in the pleadings, but must support the response to the motion with summary judgment evidence showing the existence of a genuine fact issue for trial. Id. at 321-25, 106 S.Ct. at 2551-54; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255-57, 106 S.Ct. 2505, 2513-14 (1986). All evidence and reasonable inferences must be viewed in the light most favorable to the nonmovant. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993 (1962).
The Court has no duty to search the record for triable issues of fact. Ragas v. Tennessee Gas Pipeline Co., 136 F.3d 455, 458 (5th Cir. 1998). The party opposing summary judgment is required to identify specific evidence in the record and to articulate the precise manner in which the evidence supports his claim. Id. When the nonmovant fails to provide a response identifying the disputed issues of fact, the Court is entitled to accept the movant's description of the undisputed facts as prima facie evidence of its entitlement to judgment. Eversley v. Mbank Dallas, 843 F.2d 172, 173-74 (5th Cir. 1988).
III. Defendants' Motion for Summary Judgment
Defendants have moved for summary judgment on all of Plaintiff's claims. They contend that Plaintiff's claims should be dismissed because Plaintiff lacks standing to challenge the validity or performance of the Operating Agreement or to bring his claims for conspiracy or an unconstitutional taking. Additionally, Defendants argue that all of Plaintiff's claims also fail on their merits.
A. Claims Challenging the Operating Agreement
In his pleading, Plaintiff claims that the Operating Agreement is invalid and void ab initio because Staubach, Raytheon and the Operator did not have required real estate licenses at the time the agreement was signed. He also maintains that the failure to hold such licenses also violates the Texas Real Estate Licensing Act, Tex. Rev. Civ. Stat. Ann. Art. 6573a, et seq.
1. Standing Requirement — Article III
Defendants maintain that Plaintiff's claims related to the Operating Agreement should be dismissed because Plaintiff has no standing to bring such claims. Standing is a jurisdictional requirement for any party who wishes that his complaint be heard by a federal court. Lincoln v. Case, 340 F.3d 283, 289 (5th Cir. 2003), citing United States v. Hays, 515 U.S. 737, 742-43 (1995). Standing is also an essential component of Article Ill's "case or controversy" requirement. Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992).
Three elements are required for Article III standing: 1) the plaintiff must have suffered an injury in fact — an invasion of a legally protected interest that is concrete and particularized, and actual or imminent rather than conjectural or hypothetical; 2) a causal connection between the injury and the conduct complained of; and 3) that it is likely rather than merely speculative that the injury will be redressed by a favorable decision. Lincoln, 340 F.3d at 289; Ensley v. Cody Resources, Inc., 171 F.3d 315, 319 (5th Cir. 1999). Failure to meet these minimum standards of constitutional standing means that the federal court does not have jurisdiction to hear the suit. Ensley, 171 F.3d at 319; Rivera v. Wyeth-Ayerst Laboratories, 283 F.3d 315, 319 (5th Cir. 2002).
a. Injury in Fact
"If the plaintiff is not the party who sustained the concrete and particularized injury for which a remedy is sought, . . . then it does not have standing." Chase Bank of Texas v. Florida Dept. of Ins., 274 F.3d 924, 929 (5th Cir. 2001), cert. denied, 535 U.S. 1097 (2002); see also Paradissiotis v. Rubin, 171 F.3d 983, 989 (5th Cir.), cert. denied, 528 U.S. 928 (1999). Here, Plaintiff complains that under the Operating Agreement, Staubach and Raytheon are unlawfully receiving commissions. Plaintiff is not a party to the Operating Agreement, and does not allege that he paid any of the supposed illegal commissions complained of. Plaintiff merely pays rent for his hangar under the terms of his lease with Addison, who then pays management fees to the Operator. Accordingly, Plaintiff has suffered no injury in fact related to the Operating Agreement, and thus does not meet this element of the standing requirement.
b. Causal Connection between Injury and Conduct Complained Of
Defendants further contend that there is no connection between the alleged illegality of the Operating Agreement and Plaintiff's alleged damages. For standing to be established, the alleged injury has to be fairly traceable to the challenged action of the defendant". Rivera, 283 F.3d at 321. Plaintiff is not a party to the Operating Agreement, and there is no evidence that Plaintiff's relationship with Addison (through his hangar lease) is affected in any way by the Operating Agreement. For this additional reason, Plaintiff does not have standing to challenge the Operating Agreement.
c. Injury Redressed by Favorable Decision
Plaintiff's Leases are independent agreements between Plaintiff and Addison, and are not affected in any way by the Operating Agreement. Accordingly, even if Plaintiff successfully voided the Operating Agreement, he has set forth no evidence suggesting that his alleged injury would be redressed by a favorable decision concerning the Operating Agreement. Therefore, Plaintiff has failed to meet the third element of Article Ill's standing requirement. See Grant v. Gilbert, 324 F.3d 383, 389 (5th Cir. 2003) (plaintiff lacked standing because he had no redressable injury at time of suit). Because Plaintiff has failed to meet one or more of the basic elements for Article III standing, he cannot, as a matter of law, challenge the validity of the Operating Agreement.
2. Standing Under the Texas Real Estate Licensing Act ("RELA")
Defendants also argue that Plaintiff has no standing to challenge the Operating Agreement based upon the Texas Real Estate Licensing Act ("RELA"), Tex. Civ. Stat. Ann. Art. 6573a, § 19(b). To recover under this sub-section of RELA, Plaintiff must be an "aggrieved person." Tex. Civ. Stat. Ann. Art. 6573a, § 19(b).
In Holloman v. Demon, 640 S.W.2d 417, 420 (Tex.App. — Waco. 1982, writ ref'd n.r.e), the Densons attempted to recover under section 19(b) a real estate commission paid to an unlicensed broker in connection with a property they had purchased. However, the commission at issue was not paid by the Densons and actually had been paid by the seller of the property. Id. at 419. Therefore, the court held that the Densons were not "aggrieved persons" under section 19(b) of RELA, and that in fact the seller, who did pay the commission, would be the aggrieved party. Id. at 420. Accordingly, the Densons could not recover under section 19(b) for commissions they did not pay. Id.
Similarly, Plaintiff did not pay any of the alleged illegal commissions complained of and thus is not an "aggrieved person" under RELA, Tex. Civ. Stat. Ann. Art. 6573a, § 19(b). Plaintiff has no standing to bring his RELA claim, and therefore this claim must be dismissed.
3. Standing as a Third-Party Beneficiary
Plaintiff also cannot establish standing by claiming that he is a third-party beneficiary of the Operating Agreement. To be a third-party beneficiary of a contract under Texas law, a party must establish both that 1) the contracting parties intended to confer some benefit to the third party, and 2) the contracting parties entered into the contract directly for the third party's benefit. In re El Paso Refinery, LP, 302 F.3d 343, 354 (5th Cir. 2002), citing MCI Telecommunications Corp. v. Texas Utils. Eke, Co., 995 S.W.2d 647, 651 (Tex. 1999). The intent to benefit a third party must be clear from the language of the agreement. El Paso Refinery, 302 F.3d at 354. Persons who benefit only incidentally by the performance of the contract are not third-party beneficiaries. MCI Telecommunications Corp., 995 S.W.2d at 651, citing Republic Natl. Bank of Dallas v. National Bankers Life Ins. Co., 427 S.W.2d 76, 80 (Tex.App. — Dallas 1968, writ ref'd n.r.e.).
Here, the plain language of the Operating Agreement evinces no intent by the parties to that agreement to directly benefit Plaintiff. Additionally, as Defendants point out, there is no mention of Plaintiff in the Operating Agreement at all. Therefore, the Operating Agreement was not entered into to directly secure a benefit for Plaintiff, and he is not a third-party beneficiary to that agreement. Thus, Plaintiff has no standing to sue upon the Operating Agreement as a third-party beneficiary.
B. Conspiracy Claims
The elements of Plaintiff's civil conspiracy claim are 1) two or more persons; 2) an object to be accomplished; 3) a meeting of minds on the object or course of action; 4) one or more unlawful, overt acts; and 5) damages proximately caused by the conspiracy. Apani Southwest, Inc. v. Coca-Cola Enterprises, Inc., 300 F.3d 620, 635 (5th Cir. 2002); Peavy v. WFAA-TV, Inc., 221 F.3d 158, 172 (5th Cir. 2000), cert. denied, 532 U.S. 1051 (2001). Defendants argue that Plaintiff's conspiracy claim is defective because Plaintiff has not pleaded sufficient facts to establish a conspiracy.
The Court agrees. Although Plaintiff states the elements of conspiracy in a conclusory fashion, his pleading is insufficient to plead a civil conspiracy cause of action. See Guidry v. United States Tobacco Co., 188 F.3d 619, 631-32 (5th Cir. 1999) ("a general allegation of conspiracy without a statement of the facts constituting that conspiracy is only an allegation of a legal conclusion and is insufficient to constitute a cause of action"); Delta Brands, Inc. v. Danieli Corp., 2003 WL 22255699, *7 (N.D. Tex. 2003) (same). A party pleading conspiracy must provide sufficient information to show that a valid claim of relief has been stated, and to enable the opponent to prepare responsive pleadings. Guidry, 188 F.3d at 632. For these reasons, the Court deems Plaintiff's conspiracy claims insufficiently pleaded.
Additionally, even if Plaintiff's conspiracy claims were sufficiently pleaded, Plaintiff's failure to establish standing to bring his Other claims dooms his conspiracy claims. To prevail on a civil conspiracy claim, a party must establish liability for a substantive underlying tort. Sanchez v. Liggett Myers, Inc., 187 F.3d 486, 491 (5th Cir. 1999); In re Enron Corp. Securities, Derivative ERISA Litigation, 284 F. Supp.2d 511, 645 (S.D. Tex. 2003). Because Plaintiff has no standing to bring his underlying claims, he cannot establish liability for those claims, and thus his conspiracy claims fail and must be dismissed.
C. Claims for Unconstitutional Taking of Property
Plaintiff also brings a claim against Defendant Addison that alleges Addison unconstitutionally took his property without legal authority or compensation by collecting rental payments from him. The Court finds that Plaintiff voluntarily rented a hangar from Addison, and that he was fully informed that if he rented a hangar he would be obligated to make rental payments. Because Plaintiff acted voluntarily in entering into the Leases, which obligated him to pay rent, the collection of that rent by Defendant Addison is not an unconstitutional taking. See Provident Inst. For Savings v. City of Jersey City, 113 U.S. 506, 511-15 (1885) (where plaintiff knew mortgages were subordinate to water liens, plaintiff could not complain that priority of liens was unconstitutional deprivation of property); see also Lee v. Life Ins. Co. of North America, 23 F.3d 14, 20 (1st Cir. 1994) (where university students knew from the outset that component of tuition and fees due was for health care fees and supplemental insurance premiums, students who paid fees could not complain of constitutional deprivation). Accordingly, because Plaintiff voluntarily entered into the Leases and paid rent thereunder, Plaintiff cannot complain of an involuntary taking of property, and his unconstitutional taking claims must be dismissed.
IV. Conclusion
For the reasons stated herein, Defendants' Motion for Summary Judgment is granted, and Plaintiff's claims are hereby dismissed with prejudice. Judgment will be entered by separate document.
SO ORDERED.