Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. ( 2021 )

IN THE
TENTH COURT OF APPEALS
No. 10-18-00161-CV
ABEST HOLDINGS, LLC,
Appellant
v.
FORT WORTH MAR-G, LTD,
Appellee
From the 249th District Court
Johnson County, Texas
Trial Court No. DC-C201700263
MEMORANDUM OPINION
For thirty years or more, Fort Worth Mar-G, Ltd. (FWMG) operated a commercial
billboard on a certain parcel of land. During that time, the ownership of the parcel of
land was transferred among various individuals and entities until the parcel was
eventually purchased by Abest Holdings, LLC (Abest). After Abest acquired the parcel,
a dispute arose over the billboard, resulting in FWMG suing Abest. Following a bench
trial, the trial court rendered judgment in favor of FWMG. Abest is appealing the trial
court’s judgment in four issues.
BACKGROUND
In 2003, Floyd Watkins, the then owner of the parcel of land, FWMG, and Bil-Mag,
Inc. (Bil-Mag), entered into an agreement entitled “Commercial Billboard Venture
Agreement” (the Billboard Agreement) as part of a settlement of prior litigation between
Watkins and FWMG regarding the billboard. The Billboard Agreement provides in
relevant part:
1. Purpose. The Parties form this Agreement to govern the
leasing of a commercial billboard located, according to utility records, at
2400 I-35W South, approximately 9 miles south of Burleson, Texas in
Johnson County, Texas, which billboard is owned by Fort Worth Mar-G,
Ltd., constructed upon land owned by Floyd W. Watkins and leased for that
purpose to Fort Worth Mar-G, Ltd., and is usable for advertising purposes
pursuant to a State of Texas issued permit owned and held by Bil-Mag, Inc.
It is the intent of the parties that each shall receive a 1/3 share of all net
advertising rentals received by them from the billboard, as defined more
specifically hereinbelow.
2. Contributions.
A. Fort Worth Mar-G, Ltd. will provide the billboard
structure, and will be responsible for locating and maintaining an
advertiser therefore, as well as accounting to the other parties hereto for
revenue and expenses.
B. Floyd W. Watkins will provide the land upon which
the billboard is located, being a portion of the land described in Exhibit “A”
attached hereto, more particularly described as that small tract of land in
the southeast corner of the property as set out on page 2 of the attached
exhibit.
C. Bil-Mag, Inc. will provide the Outdoor Advertising Sign
Permit concerning the billboard location.
3. Responsibilities of Each Party.
A. Fort Worth Mar-G, Ltd. agrees to maintain the
billboard in good condition, and to use best efforts to secure advertising at
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 2
the maximum rentals possible. Fort Worth Mar-G, Ltd. further agrees to . .
. properly account to each party as is more specifically set forth herein. . . .
B. Floyd W. Watkins agrees to lease the land upon which
the billboard is situated, with his payments to be received under this
Agreement to served [sic] as all rentals therefor. . . .
C. Bil-Mag, Inc. agrees to take all steps, and bear all
expenses, to ensure that the license concerning the subject billboard is at all
times in full force and effect.
The parties hereto further agree that the real property provided by
lease by Floyd W. Watkins hereunder is to be used solely for the operation
and maintenance of the billboard the subject of this Agreement. The other
parties hereto, or their agents or employees, shall have the right to enter the
property at reasonable times to post, paint, illuminate and maintain the
structure and the advertising thereon.
....
5. Term. This Agreement shall be for a term of (99) ninety-nine
years, commencing on the date of execution hereof. This Agreement shall
terminate and the obligations of each of the parties hereunder shall be
deemed completed on the happening of any of the following events: (a) the
mutual written asset [sic] of each of the parties hereto, or their successors in
interest; (b) the billboard is no longer usable for commercial purposes or the
parties are prevented by a present or future law, regulation or ordinance
from maintaining a billboard on the premises, or (c) the billboard structure
is destroyed through no fault of the parties and the parties determine not to
repair it.
....
8. . . .
The parties hereto specifically covenant and agree that this
Agreement shall be binding upon and inure to the benefit of the parties,
their heirs, successors, assigns and personal representatives.
The Billboard Agreement was not recorded in the real property records.
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 3
On December 9, 2005, Watkins sold his interest in the parcel of land to Frank’s
Casing Crew and Rental Tools, Inc. (FCC). As part of the conveyance, Watkins and FCC
entered into an agreement entitled “Indemnity Agreement” (the Indemnity Agreement)
that acknowledged the conveyance to FCC and recited that Watkins retained all rights,
obligations, benefits, costs, and expenses relating to the billboard and the Billboard
Agreement. The Indemnity Agreement further allowed the parties to the Billboard
Agreement access to the billboard for maintenance and contained a provision in favor of
FCC against Watkins for any claims arising out of the Billboard Agreement or the
billboard’s existence, construction, maintenance, repair, or damage. The Indemnity
Agreement was likewise not recorded in the real property records.
FCC sold its interest in the land on August 14, 2013 to Mosing Ventures, L.L.C.
(Mosing), and Mosing sold its interest in the land to Abest on August 8, 2016. The deed
executed by Mosing to Abest contained several exceptions to the conveyance and
warranty by the grantor, Mosing, including the “[r]ights of third parties in and to the
billboard shown in the Southeast corner of the subject property.”
FWMG thereafter sued Abest for breaching the Billboard Agreement by refusing
to grant FWMG access to the billboard or to allow FWMG the right to enter the property
to post, paint, illuminate, and maintain the billboard. FWMG further sought a
declaratory judgment against Abest that (1) FWMG owns the billboard, (2) Abest is a
successor in interest to the Billboard Agreement and Indemnity Agreement and, as such,
is bound by their terms, and (3) FWMG has a ninety-nine-year lease on the property and
Abest is obligated to allow FWMG access to the property to post, paint, illuminate, and
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 4
maintain the billboard. Alternatively, FWMG claimed an easement by estoppel to access
the billboard. Finally, FWMG sought a permanent injunction enjoining Abest from
asserting any ownership in or any control over the billboard and from denying FWMG
access to the property to perform necessary maintenance and repairs to the billboard.
Abest filed an answer denying FWMG’s allegations and asserting a counterclaim
against FWMG for trespass to try title. Abest further sought a declaratory judgment
against FWMG that (1) the billboard is a fixture to the property, (2) the Billboard
Agreement did not create a lease of the property, and (3) Abest did not have actual or
constructive knowledge of the Billboard Agreement or Indemnity Agreement before its
purchase of the property.
After a bench trial, the trial court entered a final judgment as follows:
• it declared FWMG the owner of the billboard;
• it declared that Abest is a successor in interest to Watkins under the
Billboard Agreement and a successor in interest to FCC under the
Indemnity Agreement and, as such, is bound by the terms of those
agreements;
• it declared that FWMG has a leasehold interest in the real property on
which the billboard is located pursuant to the Billboard Agreement, which
includes the right of ingress and egress across the property at reasonable
times for the purpose of posting, painting, illuminating, and maintaining
the billboard;
• it assessed actual damages of $2,388.75 and attorney’s fees of $53,706.92 in
favor of FWMG against Abest; and
• it issued a permanent injunction against Abest, prohibiting alterations or
removal of the billboard and allowing FWMG access to the billboard for
maintenance.
The trial court also entered the following findings of fact and conclusions of law:
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 5
FINDINGS OF FACT
....
2. . . . FWMG is the owner of the Billboard (the “Billboard”)
located at the southeast corner of the property commonly known as 2324
South Burleson Boulevard (I-35W), Burleson, Texas 76028 (the “Property”);
specifically described as follows:
[Metes and bounds description of the Property].
3. . . . Abest has no ownership interest in the Billboard.
4. . . . Abest is the owner of the Property.
5. . . . [The Billboard Agreement] between FWMG, Abest’s
predecessor in interest to the Property Floyd W. Watkins, and Bil-Mag, Inc.
is a valid, enforceable contract which grants FWMG an exclusive
possessory leasehold interest in the portion of the Property on which the
Billboard is located.
6. . . . [T]he Billboard Agreement grants FWMG the right of
ingress and egress across the Property to post, paint, illuminate, and
maintain the structure of the Billboard and advertising thereon.
7. . . . [T]he Billboard Agreement is binding upon all successors
in interest to the Property, including but not limited to Abest.
8. . . . [The Indemnity Agreement] between Floyd W. Watkins
and Frank’s Casing Crew and Rental Tools, Inc. is a valid, enforceable
contract.
9. . . . [T]he Indemnity Agreement is binding upon all successors
in interest to the Property, including but not limited to Abest.
10. . . . Abest had actual notice of FWMG’s rights in and to the
Billboard and the Property.
11. . . . Abest had constructive notice of FWMG’s rights in and to
the Billboard and the Property.
12. . . . Abest failed to conduct a reasonable inquiry regarding
third-party rights in and to the Billboard and the Property.
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 6
13. . . . Abest failed to comply with the Billboard Agreement by
denying FWMG access to the Billboard.
14. . . . FWMG sustained actual damages in the amount of
$2,388.75 from lost advertising rental payments as a result of Abest’s failure
to comply with the Billboard Agreement.
15. . . . Abest’s predecessors in interest to the Property
represented to FWMG, by word or action, that FWMG had an exclusive
possessory leasehold interest in the portion of the Property on which the
Billboard is located, and the right of ingress and egress across the Property
to post, paint, illuminate, and maintain the structure of the Billboard and
the advertising thereon.
16. . . . FWMG believed and relied upon the representations of
Abest’s predecessors in interest to the Property.
17. . . . FWMG acted upon the representations of Abest’s
predecessors in interest to the Property by operating the Billboard on the
Property and accessing the Billboard by crossing the Property for many
years.
18. . . . FWMG incurred $53,706.92 in reasonable and necessary
attorney’s fees and costs attributable to its Breach of Contract and
Declaratory Judgment claims.
19. . . . [T]he following contingent attorney’s fees for FWMG are
reasonable and necessary in the event of post-judgment motion(s) and/or
appeal(s) filed by Abest:
[Detailed explanation of contingent attorney’s fees].
....
CONCLUSIONS OF LAW
....
2. . . . [A] declaratory judgment that FWMG owns the Billboard
is proper.
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 7
3. . . . [T]he Billboard Agreement grants FWMG an exclusive
possessory leasehold interest in the portion of the Property on which the
Billboard is located.
4. . . . [T]he Billboard Agreement grants FWMG the right of
ingress and egress across the Property to post, paint, illuminate, and
maintain the structure of the Billboard and the advertising thereon.
5. . . . Abest had a duty to inquire about and ascertain the rights
of third-party(s) in and to the Billboard and the Property.
6. . . . Abest is not a bona fide purchaser for value with respect
to FWMG’s rights in and to the Billboard and the Property.
7. . . . Abest is liable to FWMG for breach of contract.
8. . . . Abest is estopped from claiming any ownership interest in
the Billboard or otherwise denying its knowledge of FWMG’s rights in and
to the Billboard and the Property.
9. . . . Abest is estopped from denying FWMG the right of ingress
and egress across the Property to post, paint, illuminate, and maintain the
structure of the Billboard and the advertising thereon.
10. . . . FWMG is not guilty of trespass to try title.
11. . . . FWMG will suffer irreparable injury unless Abest is
permanently enjoined from altering or removing the Billboard, or taking
any action to interfere with or deny FWMG’s right of ingress and egress
across the Property to post, paint, illuminate, and maintain the structure of
the Billboard and the advertising thereon, and that FWMG has no other
adequate legal remedy.
STANDARD OF REVIEW
Abest has not framed its issues as challenges to specific findings of fact or
conclusions of law. See Shaw v. County of Dall., 251 S.W.3d 165, 169 (Tex. App.—Dallas
2008, pet. denied) (“A party appealing from a nonjury trial in which the trial court made
findings of fact and conclusions of law should direct his attack on the sufficiency of the
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 8
evidence at specific findings of facts, rather than at the judgment as a whole.”).
Nevertheless, we will review each of Abest’s issues as challenges to the findings of fact
and conclusions of law to the extent that we can fairly ascertain the findings of fact and
conclusions of law that Abest is challenging in each issue. See Teal Trading & Dev., LP v.
Champee Springs Ranches Prop. Owners Ass’n, 534 S.W.3d 558, 582 (Tex. App.—San
Antonio 2017) (“[A] challenge to an unidentified finding of fact may be sufficient if the
reviewing court—after giving consideration to the number of findings, the nature of the
case, and the underlying elements of the applicable legal theories—can fairly determine
from the argument the specific finding being challenged.”), aff’d, 593 S.W.3d 324 (Tex.
2020); see also Tittizer v. Union Gas Corp., 171 S.W.3d 857, 863 (Tex. 2005) (per curiam)
(“[A]n appellate court should consider the parties’ arguments supporting each point of
error and not merely the wording of the points.”).
A trial court’s findings after conducting a bench trial have the same force and
dignity as a jury’s verdict upon questions. Anderson v. City of Seven Points, 806 S.W.2d
791, 794 (Tex. 1991). The findings of a trial court may be reviewed for legal and factual
sufficiency under the same standards that are applied in reviewing evidence to support
a jury’s answers. Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex. 1996) (per curiam); Catalina v.
Blasdel, 881 S.W.2d 295, 297 (Tex. 1994). When reviewing legal sufficiency, we consider
all of the evidence in the light most favorable to the verdict and indulge every reasonable
inference that would support it. City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005).
If there is more than a scintilla of evidence supporting a finding of fact, we will overrule
a legal sufficiency challenge. Formosa Plastics Corp. USA v. Presidio Eng’rs & Contractors,
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 9
Inc., 960 S.W.2d 41, 48 (Tex. 1998). When a party attacks the legal sufficiency of an adverse
finding on which it did not have the burden of proof, it must demonstrate there is no
evidence to support the adverse finding. Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex.
1983). When reviewing a factual sufficiency challenge, we consider all of the evidence
and set aside a finding only if it is so against the great weight and preponderance of the
evidence as to be clearly wrong and unjust. Ortiz, 917 S.W.2d at 772. When the appellate
record contains a reporter’s record, findings of fact are not conclusive and are binding
only if supported by the evidence. Fulgham v. Fischer, 349 S.W.3d 153, 157 (Tex. App.—
Dallas 2011, no pet.). If there is a conflict in the evidence, the trier of fact is the exclusive
judge of the facts proved, the credibility of the witnesses, and the weight to be given to
their testimony. Bonner v. Oliver, 219 S.W.2d 136, 137 (Tex. App.—Waco 1949, writ ref’d
n.r.e.).
We review the trial court’s conclusions of law de novo. Material P’ships, Inc. v.
Ventura, 102 S.W.3d 252, 257 (Tex. App.—Houston [14th Dist.] 2003, pet. denied). The
standard of review for conclusions of law is whether they are correct. Id. We will uphold
conclusions of law on appeal if the judgment can be sustained on any legal theory the
evidence supports. Id. Under de novo review, the reviewing court exercises its own
judgment and redetermines each legal issue. Wells Fargo Bank, N.A. v. Citizens Bank of
Tex., N.A., 181 S.W.3d 790, 796 (Tex. App.—Waco 2005, pet. denied). Thus, incorrect
conclusions of law do not require reversal if the controlling findings of fact support the
judgment under a correct legal theory. Westech Eng’g, Inc. v. Clearwater Constructors, Inc.,
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 10
835 S.W.2d 190, 196 (Tex. App.—Austin 1992, no writ). Moreover, conclusions of law
may not be reversed unless they are erroneous as a matter of law. Id.ISSUE TWO
We begin with Abest’s second issue, in which Abest complains that the trial court
erred in determining that the Billboard Agreement and the Indemnity Agreement are
binding on Abest. In this issue, Abest essentially challenges the trial court’s findings of
fact and conclusions of law supporting a determination that (1) Texas Property Code
section 13.001(b) renders the Billboard Agreement or the Indemnity Agreement binding
on Abest or (2) Abest is a contractual successor that was assigned rights or obligations
under either the Billboard Agreement or the Indemnity Agreement such that the
Billboard Agreement or the Indemnity Agreement is binding on Abest.
A. Successor in Interest
We first address Abest’s argument that Abest is not a contractual successor that
was assigned rights or obligations under either the Billboard Agreement or the Indemnity
Agreement such that Abest is bound by the terms of either the Billboard Agreement or
the Indemnity Agreement.
FWMG points out in its brief that both the Billboard Agreement and the Indemnity
Agreement state that they are binding on successors in interest. The Billboard Agreement
includes the statement: “The parties hereto specifically covenant and agree that this
Agreement shall be binding upon and inure to the benefit of the parties, their heirs,
successors, assigns and personal representatives.” Similarly, the Indemnity Agreement
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 11
states: “This Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective legal representatives, successors and assigns.”
But the term “successor” does not encompass a third-party purchaser of property.
See Farm & Home Sav. Ass’n v. Strauss, 671 S.W.2d 682, 685 (Tex. App.—Dallas 1984, no
writ); see also Zbranek Custom Homes, Ltd. v. Allbaugh, No. 03-14-00131-CV, 2015 WL
9436630, at *4 (Tex. App.—Austin Dec. 23, 2015, pet. denied). Therefore, there is no
evidence here that Abest is either Watkins’s or FCC’s legal successor or assign. The trial
court thus erred in determining that Abest is bound by the terms of the Billboard
Agreement and the Indemnity Agreement because Abest is a contractual successor.
B. Texas Property Code Section 13.001
We next address Abest’s argument that Texas Property Code section 13.001(b)
does not render the Billboard Agreement or the Indemnity Agreement binding on Abest.
Section 13.001 of the Property Code, entitled “Validity of Unrecorded Instrument,”
provides in pertinent part:
(a) A conveyance of real property or an interest in real property or a
mortgage or deed of trust is void as to a creditor or to a subsequent
purchaser for a valuable consideration without notice unless the
instrument has been acknowledged, sworn to, or proved and filed
for record as required by law.
(b) The unrecorded instrument is binding on a party to the instrument,
on the party’s heirs, and on a subsequent purchaser who does not
pay a valuable consideration or who has notice of the instrument.
TEX. PROP. CODE ANN. § 13.001(a), (b). The unrecorded Billboard Agreement is therefore
binding on Abest if (1) the Billboard Agreement was a “conveyance of real property or
an interest in real property or a mortgage or deed of trust” and (2) Abest was a subsequent
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 12
purchaser who did not pay a valuable consideration or who had notice of the Billboard
Agreement. See id. Likewise, the unrecorded Indemnity Agreement is binding on Abest
if (1) the Indemnity Agreement was a “conveyance of real property or an interest in real
property or a mortgage or deed of trust” and (2) Abest was a subsequent purchaser who
did not pay a valuable consideration or who had notice of the Indemnity Agreement. See
id.
1. The Billboard Agreement
a. The Nature of the Billboard Agreement
Abest first contends that the Billboard Agreement did not create a possessory
leasehold interest or any other interest in real property. Abest argues that the Billboard
Agreement was instead an attempt to convey a license to FWMG.
A lease is a grant of an estate in land for a limited term, with conditions attached.
Holcombe v. Lorino, 79 S.W.2d 307, 310 (Tex. 1935). A license, on the other hand, “is a
privilege or authority given to one or retained by one to do some act or acts on the land
of another, but which does not amount to an interest in the land itself.” Settegast v. Foley
Bros. Dry Goods Co., 270 S.W. 1014, 1016 (Tex. [Comm’n Op.] 1925); accord H.E.Y. Trust v.
Popcorn Express Co., 35 S.W.3d 55, 58 (Tex. App.—Houston [14th Dist.] 2000, pet. denied).
Whether the Billboard Agreement conveyed an interest in real property or a
license is a matter of contract interpretation. See, e.g., Meridien Hotels, Inc. v. LHO Fin.
P’ship I, L.P., 255 S.W.3d 807, 815-20 (Tex. App.—Dallas 2008, no pet.) (interpreting lease
agreement); Rolling Lands Invs., L.C. v. Nw. Airport Mgmt., L.P., 111 S.W.3d 187, 196-97
(Tex. App.—Texarkana 2003, pet. denied) (interpreting license agreement). The
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 13
interpretation of an unambiguous contract is a question of law. MCI Telecomms. Corp. v.
Tex. Utils. Elec. Co., 995 S.W.2d 647, 650 (Tex. 1999). Whether a contract is ambiguous or
unambiguous is also a question of law. J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 229
(Tex. 2003). A contract is unambiguous if it can be given a definite or certain legal
meaning. Id. If, however, the contract is subject to two or more reasonable interpretations
after applying the pertinent rules of construction, the contract is ambiguous. Id. When a
contract is ambiguous, the parties’ intent is a question of fact. Id.The primary concern in construing a written contract is to ascertain the true
intentions of the parties as expressed in the instrument. Piranha Partners v. Neuhoff, 596
S.W.3d 740, 743 (Tex. 2020). To achieve this objective, we examine and consider the entire
document in an effort to harmonize and give effect to all provisions of the contract so that
none will be rendered meaningless. Coker v. Coker, 650 S.W.2d 391, 393 (Tex. 1983). We
presume that the parties to the contract intended every clause to have some effect.
Anadarko Petroleum Corp. v. Thompson, 94 S.W.3d 550, 554 (Tex. 2002). Additionally, in
interpreting the contract, we give words their plain, common, generally accepted
meanings unless the contract shows that the parties used words in a technical or different
sense. Plains Expl. & Prod. Co. v. Torch Energy Advisors Inc., 473 S.W.3d 296, 305 (Tex.
2015).
“To create the relation of landlord and tenant, no particular words are necessary,
but it is indispensable that it should appear to have been the intention of one party to
dispossess himself of the premises and of the other to occupy them” with knowledge of
the landlord’s superior interest in the premises. Brown v. Johnson, 12 S.W.2d 543, 545 (Tex.
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 14
[Comm’n Op.] 1929); accord Cleveland Reg’l Med. Ctr., L.P. v. Celtic Props., L.C., 323 S.W.3d
322, 334 (Tex. App.—Beaumont 2010, pet. denied); Wilson v. Wagner, 211 S.W.2d 241, 243
(Tex. App.—San Antonio 1948, writ ref’d n.r.e.). A lease therefore generally grants a
tenant exclusive possession of the premises as against the owner. Cleveland v. Milner, 170
S.W.2d 472, 475 (Tex. [Comm’n Op.] 1943); Levesque v. Wilkens, 57 S.W.3d 499, 504 (Tex.
App.—Houston [14th Dist.] 2001, no pet.). But exclusive possession is not a requirement
for every lease because a landlord may reserve some rights of possession and entry in the
terms of the lease. See De Leon v. Creely, 972 S.W.2d 808, 812-13 (Tex. App.—Corpus
Christi 1998, no pet.); see also Levesque, 57 S.W.3d at 505.
Abest argues here that the Billboard Agreement did not create a possessory
leasehold interest because although the word “lease” is used multiple times in the
document, the Billboard Agreement does not contain a granting clause or any present
tense words of conveyance indicating that Watkins intended to dispossess himself of the
realty. Abest analogizes the Billboard Agreement to the agreement in Vallejo v. Pioneer
Oil Company, 744 S.W.2d 12 (Tex. 1988) (per curiam). In Vallejo, the agreement in question
was titled “Lease and Operating Agreement,” referred to the parties as “lessor” and
“lessee,” and contained many prerequisites of a valid lease, but the Texas Supreme Court
held that the agreement was not a lease because it did not contain a granting clause. Id.
at 13-14. In other words, the agreement did not contain any terms reflecting an intention
on the part of the “lessor” to transfer to the “lessee” an interest or a right of possession in
the property. Id. at 15.
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 15
The agreement in Vallejo, however, is distinguishable from the Billboard
Agreement. Section 1 of the Billboard Agreement states that the “billboard is owned by
[FWMG], constructed upon land owned by . . . Watkins and leased for that purpose to
[FWMG]. [Emphasis added.]” Subsection 2B of the Billboard Agreement, describing
Watkins’s “contribution” under the agreement, further states that Watkins “will provide
the land upon which the billboard is located.” Subsection 3B of the Billboard Agreement
then states that Watkins “agrees to lease the land upon which the billboard is situated,
with his payments to be received under this Agreement to served [sic] as all rentals
therefor.” The Billboard Agreement therefore contains language clearly reflecting
Watkins’s intention to transfer to FWMG a right of possession in the land upon which the
billboard is located.
Furthermore, the Billboard Agreement contains language reflecting Watkins’s
intention that FWMG’s possession of the property be exclusive. The Billboard Agreement
clearly designates FWMG as the lone party responsible for the operation and
maintenance of the billboard. Section 1 of the Billboard Agreement states that the
“billboard is owned by [FWMG].” Subsection 2A of the Billboard Agreement, describing
FWMG’s “contribution” under the agreement, states that FWMG “will provide the
billboard structure” and “be responsible for locating and maintaining an advertiser” on
the billboard. Subsection 3A of the Billboard Agreement further makes it FWMG’s
“responsibility” under the agreement “to maintain the billboard in good condition” and
“to use best efforts to secure advertising at the maximum rentals possible.” Neither
Watkins nor Bil-Mag shares any of those operation-and-maintenance responsibilities
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 16
under the agreement. Section 3 of the Billboard Agreement then states: “The parties
hereto further agree that the real property provided by lease by . . . Watkins hereunder is
to be used solely for the operation and maintenance of the billboard the subject of this
Agreement. [Emphasis added.]” The use of the word “solely” therefore unambiguously
reflects Watkins’s intention to dispossess himself of the land upon which the billboard is
located such that FWMG’s possession is exclusive.
Abest next argues that the wording and placement of the right-to-enter language
in the Billboard Agreement undermine any determination that the parties intended
FWMG to have exclusive possession of the land upon which the billboard is located. Just
after the above-quoted sentence requiring the leased property to be used solely for the
operation and maintenance of the billboard, the Billboard Agreement states: “The other
parties hereto, or their agents or employees, shall have the right to enter the property at
reasonable times to post, paint, illuminate and maintain the structure and the advertising
thereon.” Abest argues that this language gives Bil-Mag the same rights to the property
as it gives FWMG. Abest also asserts that the language limits FWMG’s right to use the
property and restricts FWMG’s access to the billboard to “reasonable times.”
But a lease may restrict a tenant’s right to use the property. See, e.g., Rosen v. Peck,
445 S.W.2d 241, 243 (Tex. App.—Waco 1969, no writ) (lease restricted use of property to
operation of bowling alleys and services normally found in bowling alley). FWMG’s
ingress and egress rights may also be limited to “reasonable times.” See Bradshaw v. Lower
Colo. River Auth., 573 S.W.2d 880, 884 (Tex. App.—Beaumont 1978, no writ) (holding trial
court did not err in limiting ingress and egress rights to “reasonable access”). Moreover,
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 17
as explained above, the Billboard Agreement designates FWMG the sole party
responsible for the operation and maintenance of the billboard. FWMG is therefore the
only party needing “the right to enter the property at reasonable times to post, paint,
illuminate and maintain the structure and the advertising thereon.” Accordingly, the
right-to-enter language in the Billboard Agreement does not undermine any
determination that the parties intended FWMG to have exclusive possession of the
property upon which the billboard is located. See Coker, 650 S.W.2d at 393 (“No single
provision taken alone will be given controlling effect; rather, all the provisions must be
considered with reference to the whole instrument.”).
Abest next argues that the terms of the Indemnity Agreement demonstrate that
FWMG was not granted exclusive possession of the property by the Billboard Agreement.
But the Indemnity Agreement is parol evidence as to the Billboard Agreement, and parol
evidence may not be considered to render otherwise unambiguous provisions of a
contract ambiguous. Nat’l Union Fire Ins. Co. of Pittsburgh v. CBI Indus., Inc., 907 S.W.2d
517, 520 (Tex. 1995) (per curiam). In the absence of fraud, accident, or mistake, parol
evidence is not admissible to vary, add to, or contradict the terms of a written contract
that is facially complete and unambiguous. Atmos Energy Corp. v. Paul, 598 S.W.3d 431,
463 (Tex. App.—Fort Worth 2020, no pet.); Gail v. Berry, 343 S.W.3d 520, 523 (Tex. App.—
Eastland 2011, pet. denied). As explained above, the Billboard Agreement
unambiguously reflects that the parties intended FWMG to have exclusive possession of
the land upon which the billboard is located.
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 18
Abest finally contends that that the Billboard Agreement did not create an interest
in real property because the Billboard Agreement is too indefinite. More specifically,
Abest complains that the description of the property being conveyed is insufficient, the
right-to-enter language is ambiguous, and the designation of the term of the purported
lease is indefinite.
For an agreement for the lease of real property for a term longer than one year to
be enforceable, it must contain a sufficient written description of the property. See TEX.
BUS. & COM. CODE ANN. § 26.01; Long Trusts v. Griffin, 222 S.W.3d 412, 416 (Tex. 2006) (per
curiam); Tex. Builders v. Keller, 928 S.W.2d 479, 481 (Tex. 1996) (per curiam). The
sufficiency of a legal description in any instrument transferring a property interest is a
question of law. Anderson Energy Corp. v. Dominion Okla. Tex. Expl. & Prod., Inc., 469
S.W.3d 280, 295 (Tex. App.—San Antonio 2015, no pet.); see Haines v. McLean, 276 S.W.2d
777, 781-82 (Tex. 1955).
“To be sufficient, the writing must furnish within itself, or by reference to some
other existing writing, the means or data by which the land to be conveyed may be
identified with reasonable certainty.” Morrow v. Shotwell, 477 S.W.2d 538, 539 (Tex. 1972).
The writing need not contain a metes and bounds property description to be enforceable,
but it must furnish the data to identify the property with reasonable certainty. Tex.
Builders, 928 S.W.2d at 481 (citing Morrow, 477 S.W.2d at 539). “Extrinsic evidence may
be used ‘”only for the purpose of identifying the [property] with reasonable certainty
from the data”’ contained in the contract, ‘”not for the purpose of supplying the location
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 19
or description of the [property].”’” Long Trusts, 222 S.W.3d at 416 (quoting Pick v. Bartel,
659 S.W.2d 636, 637 (Tex. 1983) (quoting Wilson v. Fisher, 188 S.W.2d 150, 152 (Tex. 1945))).
The Billboard Agreement here describes the property to be leased to FWMG as the
land upon which the billboard is located or situated, “being a portion of the land
described in Exhibit ‘A’ attached hereto, more particularly described as that small tract
of land in the southeast corner of the property as set out on page 2 of the attached exhibit.”
The exhibit is attached to the Billboard Agreement. We believe that this description
furnishes the means or data by which the land to be leased to FWMG may be identified
with reasonable certainty and is therefore sufficient. See Morrow, 477 S.W.2d at 539.
Regarding the right-to-enter language, the fact that an easement clause is vague,
indefinite, or uncertain does not authorize a court to completely ignore the valuable right
thereby granted. Vinson v. Brown, 80 S.W.3d 221, 227 (Tex. App.—Austin 2002, no pet.).
With express easements, an exact designation of location is unnecessary, as long as the
tract of land that will be burdened by the easement is sufficiently identified. Id. Here,
the tract of land that will be burdened by the easement is sufficiently identified in the
exhibit attached to the Billboard Agreement.
Lastly, “[a] lease contract must, as to its duration, be certain as to time or refer to a
certainty.” Holcombe, 79 S.W.2d at 310. “If the tenant is holding the premises for no
certain time as provided by the contract, he is merely a tenant at will.” Id. Section 5 of
the Billboard Agreement defines the term of the agreement as follows: “This Agreement
shall be for a term of (99) ninety-nine years, commencing on the date of execution hereof.”
Abest argues that this is not a definite term because the Billboard Agreement identifies
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 20
the date of execution of the agreement as only the year 2003. We believe, however, that
the Billboard Agreement sufficiently refers to a certain duration of time. Accordingly, we
conclude that the Billboard Agreement is not so indefinite such that it did not create an
interest in real property.
In light of the foregoing, we conclude that the trial court did not err in determining
that the Billboard Agreement granted FWMG (1) an exclusive possessory leasehold
interest in the portion of the property on which the billboard is located and (2) the right
of ingress and egress across the property to post, paint, illuminate, and maintain the
structure of the billboard and the advertising thereon.
b. Notice of the Billboard Agreement
Abest next contends in this issue that even if the Billboard Agreement created an
interest in real property, the Billboard Agreement is not binding on Abest because Abest
was a bona fide purchaser.
Section 13.001 of the Property Code is the codification of the bona-fide-purchaser
doctrine. Orca Assets, G.P., LLC v. Burlington Res. Oil & Gas Co., 464 S.W.3d 403, 407 (Tex.
App.—Corpus Christi 2015, pet. denied) (mem. op.); see TEX. PROP. CODE ANN. § 13.001.
A bona fide purchaser is one who acquires property in good faith, for value, and without
notice of any third-party claim or interest. Madison v. Gordon, 39 S.W.3d 604, 606 (Tex.
2001) (per curiam). “[A] bona fide purchaser prevails over a holder of a prior unrecorded
deed or other unrecorded interest in the same property.” Noble Mortg. & Invs., LLC v. D
& M Vision Invs., LLC, 340 S.W.3d 65, 75 (Tex. App.—Houston [1st Dist.] 2011, no pet.);
see TEX. PROP. CODE ANN. § 13.001(a). Notice, however, will defeat the protection
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 21
otherwise afforded a bona fide purchaser. Fletcher v. Minton, 217 S.W.3d 755, 758 (Tex.
App.—Dallas 2007, no pet.); see TEX. PROP. CODE ANN. § 13.001(b).
Notice may be actual or constructive. Madison, 39 S.W.3d at 606.
“Actual notice” literally means express or positive personal information or
knowledge directly communicated to the person to be affected. In a more
comprehensive sense, the term also embraces knowledge of all those facts
which reasonable inquiry would have disclosed, the duty of inquiry
extending only to matters that are fairly suggested by the facts really
known. In other words, whatever fairly puts a person upon inquiry is
actual notice of the facts which would have been discovered by reasonable
use of the means at hand.
Flack v. First Nat’l Bank of Dalhart, 226 S.W.2d 628, 631-32 (Tex. 1950). Whether a party
had actual notice is a question of fact. Id. at 632.
Abest acknowledges in its brief, and the evidence establishes, that when Abest
purchased the property, Abest had actual knowledge that the billboard was owned by a
third party. The contract for sale of the property to Abest was admitted as evidence and
expressly states: “The following special provisions apply and will control in the event of
a conflict with other provisions of this contract. . . . 1. The Billboard on the Property is
owned by a third party, and not the Seller.” Trial testimony further reflected that
Mosing’s listing agent disclosed to a representative of Abest, on more than one occasion,
that the billboard was owned by a third party and sent the phone number of FWMG’s
representative to Abest’s representative prior to closing. Abest’s representative’s
testimony further acknowledged that his belief was that the billboard was not included
in the sale of the property. The warranty deed conveying the property also excepted out
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 22
the “[r]ights of third parties in and to the billboard shown in the Southeast corner of the
subject property” from the conveyance and warranties.
Abest argues, however, that although it knew that the billboard was owned by a
third party, it did not have knowledge of the existence of the unrecorded Billboard
Agreement until the agreement was provided to Abest after Abest refused access to
FWMG’s electrician. But, as stated above, actual notice also includes knowledge of all
those facts that reasonable inquiry would have disclosed. Id. at 631-32. After reviewing
the evidence under the appropriate standards, we conclude that the evidence is legally
and factually sufficient to support the trial court’s findings that Abest failed to conduct a
reasonable inquiry regarding third-party rights in and to the billboard and the property
and that Abest had actual notice of the Billboard Agreement.
Having concluded that the trial court did not err in finding that the Billboard
Agreement was a conveyance of an interest in real property and that Abest was a
subsequent purchaser who had notice of the Billboard Agreement, we conclude that the
trial court also did not err in determining that the Billboard Agreement is binding on
Abest. See TEX. PROP. CODE ANN. § 13.001.
2. The Indemnity Agreement
We now turn to whether section 13.001(b) renders the Indemnity Agreement
binding on Abest.
Although the trial court made a finding in this case that the Billboard Agreement
created an interest in the realty, the trial court did not make a similar finding regarding
the Indemnity Agreement. FWMG seems to argue that the Indemnity Agreement is
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 23
nevertheless binding on Abest because Abest was not a bona fide purchaser of the
property. But even if Abest was not a bona fide purchaser, section 13.001(b) does not
render the Indemnity Agreement binding on Abest unless the Indemnity Agreement was
a conveyance of an interest in real property. See id. Because it was not, section 13.001(b)
does not render the Indemnity Agreement binding on Abest. See id.
We therefore conclude that the trial court erred in determining that the Indemnity
Agreement is binding on Abest. We sustain Abest’s second issue in part and overrule it
in part.
ISSUE THREE
In its third issue, Abest complains that the trial court erred in granting an apparent
easement by estoppel to FWMG. In light of our disposition of Abest’s second issue, we
need not reach this issue.
ISSUE ONE
In its first issue, Abest asserts that the trial court erred in failing to quiet title in the
realty to Abest; however, Abest’s argument is that the billboard is a fixture and that
because the billboard is a fixture, its ownership passed to Abest, the titleholder of the
property. Abest is therefore essentially challenging the trial court’s findings of fact and
conclusions of law supporting a determination that FWMG is the owner of the billboard
and that Abest is estopped from claiming any ownership interest in the billboard.
Subject matter jurisdiction is essential to a court’s power to decide a case. Bland
Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 553-54 (Tex. 2000); Tex. Ass’n of Bus. v. Tex. Air
Control Bd., 852 S.W.2d 440, 443 (Tex. 1993). Not only may a reviewing court assess
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 24
jurisdiction for the first time on appeal, but all courts bear the affirmative obligation “to
ascertain that subject matter jurisdiction exists regardless of whether the parties have
questioned it.” City of Houston v. Rhule, 417 S.W.3d 440, 442 (Tex. 2013) (per curiam)
(quoting In re United Servs. Auto. Ass’n, 307 S.W.3d 299, 306 (Tex. 2010) (orig. proceeding)).
The Texas Uniform Declaratory Judgments Act gives Texas courts the power to
“declare rights, status, and other legal relations whether or not further relief is or could
be claimed.” TEX. CIV. PRAC. & REM. CODE ANN. § 37.003(a). The Act “is remedial; its
purpose is to settle and to afford relief from uncertainty and insecurity with respect to
rights, status, and other legal relations; and it is to be liberally construed and
administered.” Id. § 37.002(b).
The Act does not create or augment a trial court’s subject-matter
jurisdiction—it is “merely a procedural device for deciding cases already
within a court’s jurisdiction.” Tex. Ass’n of Bus., 852 S.W.2d at 444. A
declaratory-judgment action will lie within the trial court’s subject-matter
jurisdiction when a justiciable controversy exists as to the rights and status
of the parties before the court for adjudication, and the requested
declaration will actually resolve the controversy. Brooks v. Northglen Ass’n,
141 S.W.3d 158, 163-64 (Tex. 2004); OAIC Com[.] Assets, L.L.C. v. Stonegate
Vill., L.P., 234 S.W.3d 726, 745 (Tex. App.—Dallas 2007, pet. denied). A
justiciable controversy is one in which a real and substantial controversy
exists involving a genuine conflict of tangible interest and not merely a
theoretical dispute. Bonham State Bank [v. Beadle], 907 S.W.2d [465,] 467
[(Tex. 1995)]; Trinity Universal Ins. Co. v. Sweatt, 978 S.W.2d 267, 270 (Tex.
App.—Fort Worth 1998, no pet.) (justiciable controversy is “real
controversy between the parties that will be actually determined by the
judicial declaration sought”). A justiciable controversy is to be
distinguished from an advisory opinion, which is prohibited under the
Texas and federal constitutions. Tex. Ass’n of Bus., 852 S.W.2d at 444. If a
justiciable controversy does not exist, the trial court must dismiss the case
for lack of subject-matter jurisdiction. Di Portanova v. Monroe, 229 S.W.3d
324, 330 (Tex. App.—Houston [1st Dist.] 2006, pet. denied).
Transp. Ins. Co. v. WH Cleaners, Inc., 372 S.W.3d 223, 227 (Tex. App.—Dallas 2012, no pet.).
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 25
Here, in our disposition of Abest’s second issue, we held that the trial court did
not err in determining that the Billboard Agreement is binding on Abest. In reaching
such holding, we concluded that the trial court did not err in determining that the
Billboard Agreement granted FWMG (1) an exclusive possessory leasehold interest in the
portion of the property on which the billboard is located and (2) the right of ingress and
egress across the property to post, paint, illuminate, and maintain the structure of the
billboard and the advertising thereon. Because the term of FWMG’s lease has not yet
ended, a determination of which party is the owner of the billboard is therefore
premature. Until then, a justiciable controversy regarding the ownership of the billboard
does not exist.
In light of the foregoing, the trial court did not have jurisdiction to hear the portion
of FWMG’s declaratory judgment action regarding the ownership of the billboard. See
id.ISSUE FOUR
In its fourth issue, Abest complains that the trial court erred in awarding attorney’s
fees to FWMG. Abest does not dispute the amount of attorney’s fees awarded; it merely
argues that FWMG is not entitled to attorney’s fees.
Abest first argues that FWMG is not entitled to attorney’s fees because FWMG
“has merely couched its suit as a declaratory judgment action, when in reality it was a
suit for the recovery of an interest in the realty.” But a complaint about a failure to use a
trespass to try title action instead of a declaratory judgment action can be waived if not
raised in the trial court. Krabbe v. Anadarko Petroleum Corp., 46 S.W.3d 308, 321 (Tex.
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 26
App.—Amarillo 2001, pet. denied); see TEX. R. APP. P. 33.1(a). Abest did not raise any
complaint in the trial court about FWMG failing to use a trespass to try title action instead
of a declaratory judgment action. Abest has therefore failed to preserve such complaint
for review.
Abest next argues that FWMG cannot recover attorney’s fees for breach of contract
because Abest does not have any obligations under the Billboard Agreement if the
Indemnity Agreement is enforceable against Abest. In addressing Abest’s second issue,
however, we concluded that the trial court erred in concluding that the Indemnity
Agreement is binding on Abest.
Accordingly, we overrule Abest’s fourth issue.
CONCLUSION
We vacate that portion of the trial court’s judgment declaring that FWMG is the
owner of the billboard and dismiss that portion of the trial court’s judgment for want of
jurisdiction. See TEX. R. APP. P. 43.2(e). We modify the trial court’s judgment by changing
2. Abest Holdings, LLC is a successor in interest to Floyd Watkins in
and under the 2003 Commercial Billboard Venture Agreement (the
“Billboard Agreement”) attached hereto as Exhibit A and
incorporated herein by reference, and a successor in interest of
Frank’s Casing Crew and Rental Tools, Inc. in and under the 2005
Indemnity Agreement (the “Indemnity Agreement”) attached hereto
as Exhibit B and incorporated herein by reference, and as such, is
bound by their terms.
to “2. Abest Holdings, LLC is bound by the terms of the 2003 Commercial Billboard
Venture Agreement (the “Billboard Agreement”), attached hereto as Exhibit A and
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 27
incorporated herein by reference.” We otherwise affirm the trial court’s judgment as
modified. See id. R. 43.2(b).
MATT JOHNSON
Justice
Before Chief Justice Gray,
Justice Johnson, and
Justice Scoggins1
(Chief Justice Gray dissents. A separate opinion will not issue.)
Vacated in part and affirmed as modified in part
Opinion delivered and filed June 2, 2021
[CV06]
1The Honorable Al Scoggins, Senior Justice of the Tenth Court of Appeals, sitting by assignment of the
Chief Justice of the Texas Supreme Court. See TEX. GOV’T CODE ANN. §§ 74.003, 75.002, 75.003.
Abest Holdings, LLC v. Fort Worth Mar-G, Ltd. Page 28