D.R. Horton - Texas, Ltd. and DRHI, Inc. v. Savannah Properties Associates, L.P. , 416 S.W.3d 217 ( 2013 )

COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-12-00349-CV
D.R. HORTON - TEXAS, LTD. AND APPELLANTS
DRHI, INC.
V.
SAVANNAH PROPERTIES APPELLEE
ASSOCIATES, L.P.
----------
FROM THE 362ND DISTRICT COURT OF DENTON COUNTY
----------
OPINION
----------
I. Introduction
Appellants D.R. Horton – Texas, Ltd. (D.R. Horton) and DRHI, Inc. (DRHI)
appeal a summary judgment in favor of Appellee Savannah Properties
Associates, L.P. (Savannah). In three sub-issues, D.R. Horton and DRHI
contend the trial court erred by not granting their motion for continuance of the
submission date of Savannah’s summary judgment motions, by granting
Savannah’s motion for summary judgment on its affirmative defenses of release,
res judicata, novation, and limitations, and by granting Savannah’s no-evidence
motion for summary judgment on D.R. Horton’s and DRHI’s breach of contract,
breach of warranty, negligence, and fraudulent inducement claims. We affirm.
II. Factual and Procedural Background
This appeal arises out of the second lawsuit between the parties.
Savannah was the developer of multiple phases of residential single-family lots
and commercial tracts in the Savannah Addition, a suburban development in
Denton County, Texas. In February 2003, Savannah entered into a Contract of
Purchase and Sale with DRHI (the Horton Contract) under which DRHI agreed to
purchase from Savannah 800 residential lots in the Savannah Addition for the
purpose of constructing single-family homes. In March 2003, Savannah and
DRHI entered into another Contract of Purchase and Sale (the Continental
Contract) under which DRHI agreed to purchase from Savannah 800 additional
lots in the Savannah Addition for the same purpose.
DRHI transferred and assigned its rights and obligations under the Horton
Contract and the Continental Contract to D.R. Horton. Savannah sold its interest
in the Savannah Addition to CHS Savannah, L.P. (CHS) and assigned its rights
and obligations under the Horton Contract and the Continental Contract to CHS. 1
1
CHS Savannah, L.P. is not a party to this appeal.
2
In 2007, a dispute arose between D.R. Horton and CHS over the Horton
Contract and the Continental Contract. Savannah and CHS filed suit against
D.R. Horton and DRHI, asserting breach of contract, fraud, and negligent
misrepresentation claims arising from D.R. Horton’s and DRHI’s alleged failure to
purchase and close on the number of lots required by the Horton Contract and
Continental Contract. D.R. Horton and DRHI filed counterclaims against
Savannah and CHS, claiming they breached the Horton Contract and the
Continental Contract by giving preferential treatment to another homebuilder
working in the Savannah Addition.
D.R. Horton, DRHI, Savannah, and CHS settled the first lawsuit and
entered into a settlement agreement under which the parties merged the
Continental Contract into the Horton Contract so the Horton Contract was the
only contract between the parties. Pursuant to the terms of the settlement
agreement, CHS and D.R. Horton also amended the Horton Contract by entering
into a Reinstatement of and Twelfth Amendment to Contract of Purchase and
Sale (the Amended Contract). Under the terms of the settlement agreement,
D.R. Horton and DRHI released Savannah and CHS from any and all claims
belonging to D.R. Horton and DRHI, known or unknown, asserted or unasserted
in the first lawsuit with respect to, arising from, or related in any way to the
Horton Contract, the Continental Contract, the Savannah Addition, or the
Amended Contract. As set forth in the settlement agreement, the parties filed a
3
joint motion to dismiss the case with prejudice. The trial court granted the motion
and signed an order dismissing the first lawsuit with prejudice in May 2008.
On April 20, 2009, D.R. Horton and DRHI filed the present lawsuit against
Savannah and CHS, asserting breach of contract, breach of warranty, and
negligence claims arising out of Savannah’s and CHS’s alleged failure to
properly prepare the soil on the lots they sold to D.R. Horton and DRHI for
residential construction. In its answer, Savannah asserted the affirmative
defense of release. Savannah filed a motion for summary judgment on its
release defense, claiming D.R. Horton and DRHI released all claims against
Savannah related to the Amended Contract and the Savannah Addition in the
settlement agreement. The motion was denied.
On August 11, 2011, Savannah amended its answer to assert additional
affirmative defenses, including res judicata, novation, and limitations. Savannah
filed a motion for summary judgment on August 17, 2011 seeking a traditional
summary judgment on its res judicata, novation, and limitations defenses and a
no-evidence summary judgment on D.R. Horton’s and DRHI’s breach of contract,
breach of warranty, and negligence claims. Savannah’s motion was set for
submission on October 14, 2011. On October 12, 2011, D.R. Horton and DRHI
filed a motion for continuance, claiming they needed additional time for
discovery. Savannah’s motion was re-set for submission on January 13, 2012.
On December 11, 2011, Savannah filed a motion asking the trial court to
4
reconsider its order denying Savannah’s motion for summary judgment on its
release defense.
The motion to reconsider and motions for summary judgment were heard
by submission on January 13, 2012. On March 5, 2012, D.R. Horton and DRHI
filed a fourth amended petition, asserting additional claims of fraudulent
inducement and alter ego against Savannah. D.R. Horton and DRHI filed a fifth
amended petition on March 27, 2012, adding a joint enterprise claim against
Savannah. On April 17, 2012, Savannah filed a motion to strike these pleadings.
On April 17, 2012, the trial court granted (1) Savannah’s motion to
reconsider, (2) Savannah’s motion for summary judgment on its release defense,
(3) Savannah’s motion for summary judgment on its res judicata, novation, and
limitations defenses, and (4) Savannah’s no-evidence motion for summary
judgment on D.R. Horton’s and DRHI’s breach of contract, breach of warranty,
and negligence claims. The trial court did not specify the grounds upon which it
relied in granting the motions.
Savannah filed an amended motion to strike D.R. Horton’s and DRHI’s
fourth and fifth amended petitions. The trial court granted the amended motion,
striking all new, amended, or supplemental allegations relating to Savannah
made in D.R. Horton’s and DRHI’s fourth and fifth amended petitions. The trial
court then severed D.R. Horton’s and DRHI’s claims against Savannah, thus
5
making the court’s order on the motion to reconsider and motions for summary
judgment final and appealable. 2 This appeal followed.
III. Motion for Continuance
In their first sub-issue, D.R. Horton and DRHI contend the trial court
abused its discretion by not continuing the January 13, 2012 submission of
Savannah’s motions for summary judgment. D.R. Horton and DRHI allege they
did not have adequate time prior to the submission date to conduct discovery on
their claims and on Savannah’s res judicata, novation, and limitations defenses.
In response, Savannah contends D.R. Horton and DRHI failed to preserve error
on this sub-issue because they did not set the motion for continuance for hearing
or bring it to the trial court’s attention. Savannah also contends that the trial court
did not abuse its discretion by denying D.R. Horton’s and DRHI’s motion for
continuance because D.R. Horton and DRHI did not describe the evidence
sought, explain its materiality, and show they had used due diligence in trying to
obtain the evidence. 3
2
D.R. Horton and DRHI do not challenge on appeal the trial court’s ruling
on Savannah’s motion to reconsider.
3
Savannah also claims the trial court did not abuse its discretion by
denying D.R. Horton’s and DRHI’s motion for continuance because D.R. Horton
and DRHI did not file an affidavit in support of their motion as required by Texas
Rule of Civil Procedure 251. See Tex. R. Civ. P. 251. A review of the record,
however, reveals that D.R. Horton and DRHI did file an affidavit in support of
their motion.
6
A. Standard of Review
We review a trial court’s ruling on a motion for continuance for an abuse of
discretion. See BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 800
(Tex. 2002). We do not substitute our judgment for that of the trial court. In re
Nitla S.A. de C.V., 92 S.W.3d 419, 422 (Tex. 2002) (orig. proceeding). Instead,
we must determine whether the trial court’s action was so arbitrary and
unreasonable as to amount to a clear and prejudicial error of law. Joe v. Two
Thirty Nine Joint Venture, 145 S.W.3d 150, 161 (Tex. 2004). The test is whether
the trial court acted without reference to guiding rules or principles. Cire v.
Cummings, 134 S.W.3d 835, 838–39 (Tex. 2004).
B. Applicable Law
Rule 166a(g) permits a trial court to deny a motion for summary judgment
or grant a continuance to the party opposing summary judgment if the party
opposing summary judgment files an affidavit setting forth the reasons the party
cannot present the facts necessary to respond to the motion. Tex. R. Civ. P.
166a(g); Ford Motor Co. v. Castillo, 279 S.W.3d 656, 662 (Tex. 2009). A motion
for continuance seeking time for discovery must be supported by an affidavit that
describes the evidence sought, explains its materiality, and shows that the party
requesting the continuance has used due diligence to timely obtain the evidence.
Tex. R. Civ. P. 251, 252; Landers v. State Farm Lloyds, 257 S.W.3d 740, 747
(Tex. App.—Houston [1st Dist.] 2008, no pet.) However, a litigant who fails to
diligently use the rules of civil procedure for discovery purposes is not entitled to
7
a continuance. State v. Wood Oil Distrib., Inc., 751 S.W.2d 863, 865 (Tex.
1988). In deciding whether a trial court abused its discretion in denying a motion
for continuance seeking additional time to conduct discovery, we consider factors
such as the length of time the case has been on file, the materiality and purpose
of the discovery sought, and whether the party seeking the continuance has
exercised due diligence to obtain the discovery sought. Two Thirty Nine Joint
Venture, 145 S.W.3d at 161.
Under rule 166a(i), there is no specific minimum amount of time that a
case must be pending before a trial court may entertain a no-evidence motion for
summary judgment; the rule only requires an “adequate time for discovery.” See
Tex. R. Civ. P. 166a(i). In considering whether the trial court permitted an
adequate time for discovery, we consider the following factors: (1) the nature of
the case, (2) the nature of the evidence necessary to controvert the no-evidence
motion, (3) the length of time the case was active, (4) the amount of time the no-
evidence motion was on file, (5) whether the movant had requested stricter
deadlines for discovery, (6) the amount of discovery that already had taken
place, and (7) whether the discovery deadlines in place were specific or vague.
McInnis v. Mallia, 261 S.W.3d 197, 201 (Tex. App.—Houston [14th Dist.] 2008,
no pet.)
C. Analysis
The record does not show that the motion for continuance was heard by or
ruled upon by the trial court. However, assuming the trial court impliedly denied
8
the motion for continuance, 4 we conclude that it did not abuse its discretion. D.R.
Horton and DRHI argue they needed additional time to conduct discovery so they
could depose four of Savannah’s experts whose deposition notices Savannah
quashed and redepose witnesses whose depositions were taken before
Savannah asserted its res judicata, novation, and limitations defenses. D.R.
Horton and DRHI complain they did not have adequate time to conduct discovery
on Savannah’s res judicata, novation, and limitations defenses because
Savannah’s motion for summary judgment on those defenses was served on
D.R. Horton and DRHI just five days after those defenses were first pled by
Savannah. 5
Submission of Savannah’s motion for summary judgment on its newly pled
affirmative defenses and D.R. Horton’s and DRHI’s claims was originally
4
Compare Hightower v. Baylor Univ. Med. Ctr., 251 S.W.3d 218, 224–25
(Tex. App.—Dallas 2008, pet. struck) (holding that appellant did not preserve
error because he failed to obtain ruling on motion for continuance), and Dart v.
Balaam, 953 S.W.2d 478, 483 (Tex. App.—Fort Worth 1997, no pet.) (holding
same), with Tex. R. App. P. 33.1(a)(2)(A) (providing that, to preserve error, trial
court must have expressly or implicitly ruled on request, objection, or motion),
and Williams v. Bank One, Tex., N.A., 15 S.W.3d 110, 114–15 (Tex. App.—Waco
1999, no pet.) (holding that trial court impliedly ruled on motion for continuance
by granting motion for summary judgment when appellant filed motion for
continuance two days before summary judgment hearing).
5
D.R. Horton and DRHI also complain on appeal that the complexity of the
case and the number of parties and attorneys involved necessitated additional
time to conduct discovery with respect to their claims. These reasons were not
included in D.R. Horton’s and DRHI’s motion for continuance or the affidavit
accompanying the motion as required by rules 251 and 252. See Tex. R. Civ. P.
251, 252. Therefore, we do not consider them on appeal. See Tex. R. App. P.
33.1(a).
9
scheduled for October 14, 2011 and was rescheduled for January 13, 2012.
When the motions for summary judgment were submitted on January 13, the
lawsuit had been on file for well over two years, and the motion for summary
judgment on Savannah’s newly pled affirmative defenses and on D.R. Horton’s
and DRHI’s claims had been on file for over five months. In their motion for
continuance, D.R. Horton and DRHI did not identify which witnesses they needed
to redepose. Nor did they explain the nature and materiality of the testimony
they expected to elicit from these witnesses or from Savannah’s four expert
witnesses. D.R. Horton and DRHI claim they exercised due diligence in
obtaining discovery because they noticed Savannah’s expert witnesses for
deposition, but Savannah quashed the notices. D.R. Horton and DRHI did not
show they made another attempt to obtain these depositions in the intervening
five months between the filing of the motions for summary judgment and the date
the motions were submitted. Therefore, we cannot say the trial court abused its
discretion by denying the motion for continuance. We overrule D.R. Horton’s and
DRHI’s first sub-issue.
IV. D.R. Horton’s and DRHI’s Fraudulent Inducement Claim
As part of their third sub-issue, D.R. Horton and DRHI contend the trial
court erred by granting Savannah’s no-evidence motion for summary judgment
because Savannah did not address D.R. Horton’s and DRHI’s fraudulent
inducement claim in its motion. In response, Savannah argues the trial court did
not err by granting Savannah’s no-evidence motion for summary judgment
10
because D.R. Horton’s and DRHI’s fraudulent inducement claim was made in
amended pleadings filed after the submission of the summary judgment that
were struck by the trial court. 6
A. Applicable Law
Rule 166a(c) provides that a trial court shall render summary judgment if
the pleadings and summary judgment evidence “on file at the time of the hearing,
or filed thereafter and before judgment with permission of the court” show the
movant is entitled to judgment as a matter of law. Tex. R. Civ. P. 166a(c). After
a summary judgment hearing but before a trial court renders judgment, a party
must obtain leave of the court to amend a pleading. Tex. R. Civ. P. 63; Austin v.
Countrywide Homes Loans, 261 S.W.3d 68, 75 (Tex. App.—Houston [1st Dist.]
2008, pet. denied) (“Once the hearing date for a motion for summary judgment
has passed, the movant must secure a written order granting leave in order to file
an amended pleading.”). A pleading filed after the summary judgment hearing
without leave of court cannot be considered by the trial court. See Taylor v.
Sunbelt Mgmt., Inc., 905 S.W.2d 743, 745 (Tex. App.—Houston [14th Dist.]
1995, no writ) (stating “we cannot consider appellants' pleadings which were
admittedly filed after the motion for summary judgment hearing”); W. Tex. Gas,
Inc. v. 297 Gas Co., 864 S.W.2d 681, 685 (Tex. App.—Amarillo 1993, no writ)
6
D.R. Horton and DRHI do not challenge on appeal the trial court’s order
striking all new, amended, or supplemental allegations relating to Savannah
made in D.R. Horton’s and DRHI’s fourth and fifth amended petitions.
11
(holding trial court did not err by failing to consider amended petition filed after
hearing without leave of court). Because an amendment that is not timely and
not allowed by the trial court does not supersede the prior petition, the summary
judgment movant need not amend or supplement his motion to address those
claims. See Taylor, 905 S.W.2d at 745 (citing Tex. R. Civ. P. 166a(c) and
holding trial court did not err by granting summary judgment when new,
unaddressed claims were added by amended petition filed after hearing without
leave of court); W. Tex. Gas, Inc., 864 S.W.2d at 685 (same).
B. Analysis
D.R. Horton’s and DRHI’s fraudulent inducement claim was not contained
in D.R. Horton’s and DRHI’s pleadings on file at the time Savannah’s motions for
summary judgment were submitted on January 13, 2012. D.R. Horton and DRHI
asserted this cause of action in their fourth and fifth amended petitions, both of
which were filed after the summary judgment submission date without leave of
court. We presume that leave to amend was not granted unless the record
shows that the trial court granted leave. See Austin, 261 S.W.3d at 76. Nothing
in the record indicates the trial court granted leave or that D.R. Horton and DRHI
sought leave. See Taylor, 905 S.W.2d at 745; W. Tex. Gas, Inc., 864 S.W.2d at
685.
We hold the trial court did not err by rendering summary judgment in favor
of Savannah because D.R. Horton’s and DRHI’s fraudulent inducement claim
was contained in amended petitions that were filed without the court’s permission
12
after the summary judgment had been heard by submission. See Taylor, 905
S.W.2d at 745; W. Tex. Gas, Inc., 864 S.W.2d at 685. Accordingly, we overrule
the portion of D.R. Horton’s and DRHI’s third sub-issue challenging the no-
evidence summary judgment on D.R. Horton’s and DRHI’s fraudulent
inducement claim.
V. Motions for Summary Judgment
In their second sub-issue, D.R. Horton and DRHI contend the trial court
erred by granting Savannah’s motion for summary judgment on its affirmative
defenses of release, res judicata, novation, and limitations. In the remaining
portions of their third issue, D.R. Horton and DRHI complain the trial court erred
by granting Savannah’s no-evidence motion for summary judgment on D.R.
Horton’s and DRHI’s breach of contract, breach of warranty, and negligence
claims. Because Savannah’s release defense is dispositive of this case, we
consider it first. 7
A. Standard of Review
We review a summary judgment de novo. Travelers Ins. Co. v. Joachim,
315 S.W.3d 860, 862 (Tex. 2010). We consider the evidence presented in the
light most favorable to the nonmovant, crediting evidence favorable to the
7
Although we usually address the no-evidence motion first when both no-
evidence and traditional summary judgment motions are filed, see Ford Motor
Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex. 2004), we will review the propriety of
granting the traditional summary judgment on Savannah’s release affirmative
defense first because it is dispositive. See Tex. R. App. P. 47.1.
13
nonmovant if reasonable jurors could, and disregarding evidence contrary to the
nonmovant unless reasonable jurors could not. Mann Frankfort Stein & Lipp
Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009). We indulge every
reasonable inference and resolve any doubts in the nonmovant’s favor. 20801,
Inc. v. Parker, 249 S.W.3d 392, 399 (Tex. 2008). A defendant is entitled to
summary judgment on an affirmative defense if the defendant conclusively
proves all the elements of the affirmative defense. Frost Nat’l Bank v.
Fernandez, 315 S.W.3d 494, 508–09 (Tex. 2010); see Tex. R. Civ. P. 166a(b),
(c). To accomplish this, the defendant-movant must present summary judgment
evidence that conclusively establishes each element of the affirmative defense.
See Chau v. Riddle, 254 S.W.3d 453, 455 (Tex. 2008). When, as here, the trial
court’s summary judgment order does not state the basis for the trial court’s
decision, we must affirm the order if any of the theories presented to the trial
court and preserved for appellate review are meritorious. See Provident Life &
Accident Ins. Co. v. Knott, 128 S.W.3d 211, 216 (Tex. 2003); Star-Telegram, Inc.
v. Doe, 915 S.W.2d 471, 473 (Tex. 1995).
B. Applicable Law
A release is an agreement or contract in which one party agrees that a
legal right or obligation owed by the other party is surrendered. Dresser Indus.,
Inc. v. Page Petroleum, Inc., 853 S.W.2d 505, 508 (Tex. 1993). It is subject to
the normal rules of contract construction, including the rules of ambiguity. Nat'l
Union Fire Ins. Co. of Pittsburgh, Pa. v. Ins. Co. of N. Am., 955 S.W.2d 120, 127
14
(Tex. App.—Houston [14th Dist.] 1997), aff'd, 20 S.W.3d 692 (Tex. 2000). A
release extinguishes a claim or cause of action and is an absolute bar to any
right of action on the released matter. Dresser Indus., 853 S.W.2d at 508.
To release a claim effectively, the releasing instrument must “mention” the
claim to be released. Victoria Bank & Trust Co. v. Brady, 811 S.W.2d 931, 938
(Tex. 1991); see Keck, Mahin & Cate v. Nat'l Union Fire Ins. Co. of Pittsburgh,
Pa., 20 S.W.3d 692, 698 (Tex. 2000). Claims not clearly within the subject
matter of the release are not discharged, even if those claims exist when the
release is executed. Keck, 20 S.W.3d at 698. It is not necessary, however, for
the parties to anticipate and explicitly identify every potential cause of action
relating to the subject matter of the release. Id. Although releases include
claims existing at the time of execution, they may also include unknown claims
and damages that develop in the future. See id.
In construing a release, as with other contracts, the primary effort is to
ascertain and give effect to the intention of the parties to the release, considering
the instrument as a whole. Stafford v. Allstate Life Ins. Co., 175 S.W.3d 537, 541
(Tex. App.—Texarkana 2005, no pet.) (reasoning that a contract must be read as
a whole rather than isolating a certain phrase, sentence, or section of the
agreement). The contract’s language is to be given its plain grammatical
meaning unless doing so would defeat the parties’ intent. Id. In determining
intent, we must look to the contract, not what the parties allegedly meant. Union
Pacific R.R. v. Novus Int'l, Inc., 113 S.W.3d 418, 421 (Tex. App.—Houston [1st
15
Dist.] 2003, pet. denied). An unambiguous contract will be enforced as written.
David J. Sacks, P.C. v. Haden, 266 S.W.3d 447, 450 (Tex. 2008). Parol
evidence may not be introduced to create an ambiguity or to alter the intent of the
parties as expressed in the instrument. Id.
C. Analysis
D.R. Horton and DRHI argue that their claims in the second lawsuit were
not released because the settlement agreement does not release Savannah from
“any duties, obligations, covenants, agreements or warranties set forth in the
Amended Contract.” Savannah contends that, by the settlement agreement in
the first lawsuit, D.R. Horton and DRHI released all of their claims against
Savannah related to the Savannah Addition and the Amended Contract.
Paragraph 6 of settlement agreement provides as follows:
DRHI and [D.R. Horton], for and on behalf of themselves and their
respective affiliates, parents, subsidiaries, predecessors, partners,
owners, officers, directors, employees, representatives, members,
attorneys, successors and assigns, if any (collectively, the ‘Horton
Releasors’), hereby fully, finally, completely, generally and forever
RELEASE, DISCHARGE, ACQUIT and RELINQUISH [Savannah]
and [CHS] and all of their respective affiliates, parents, subsidiaries,
predecessors, partners (including, but not limited to, CH MM Denton
LLC and Suncrest Savannah, L.P.), owners, officers, directors,
employees, representatives, members, attorneys, successors and
assigns, if any (collectively, the ‘Savannah Releasees’), of and from
any and all claims, actions, demands, and causes of action, of
whatever kind or character, in law or in equity, known or unknown,
asserted or unasserted in the Lawsuit, as of the Effective Date, for
any and all injuries, harm, damages, penalties, costs, fees, losses,
expenses, liability, remedies, or other detriment, of whatever kind or
character, which any of the Horton Releasors, jointly or severally,
has, had or may have against any of the Savannah Releasees with
respect to, arising from or related in any way to the Horton Contract,
16
the Continental Contract, the Amended Contract, or the Savannah
Addition, including, without limitation, any such claims or causes of
action that were or could have been brought in the Lawsuit (the
“Horton Released Claim(s)”).
The language of paragraph 6 of the settlement agreement is unambiguous, and it
releases any and all past, present, or future claims, actions, demands, and
causes of action, of whatever kind or character, known or unknown, asserted or
unasserted “with respect to, arising from, or related in any way to the Horton
Contract, the Continental Contract, the Amended Contract, or the Savannah
Addition.” D.R. Horton’s and DRHI’s breach of contract, breach of warranty, and
negligence claims all arise from Savannah’s alleged failure to prepare the soil on
the lots in the Savannah Addition that were sold to D.R. Horton and DRHI and
from Savannah’s alleged breach of the Amended Contract. Accordingly, D.R.
Horton’s and DRHI’s claims in this lawsuit fall within the scope of paragraph 6.
D.R. Horton and DRHI do not dispute that their claims fall within the scope
of paragraph 6 of the settlement agreement. Instead, they claim the settlement
agreement did not release its claims in this lawsuit because those claims were
preserved by paragraph 7 of the settlement agreement, which provides as
follows:
Notwithstanding anything else to the contrary set forth in this
Agreement, this Agreement is not intended to release and shall not
release any Party from any duties, obligations, covenants,
agreements or warranties set forth in the Amended Contract, set
forth in this Agreement, or set forth in any document hereafter
executed that survives the execution of the Amended Contract, the
termination thereof, or the closing of lots under the Amended
Contract, such as, but without limitation, the obligation of CHS
17
Savannah under the Earnest Money Deed of Trust (as defined in the
Amended Contract). Additionally, notwithstanding anything else to
the contrary contained in this Agreement, with respect to lots
previously purchased and sold under the Horton Contract or the
Continental Contract, this Agreement is not intended to and shall not
release any Party from any duties, obligations, covenants,
agreements or warranties pertaining to title set forth in or arising
from any deed related to the prior purchase and sale of such lots.
D.R. Horton’s and DRHI’s claims against Savannah do not arise from the
duties, obligations, covenants, agreements, or warranties set forth in the
settlement agreement or any document executed after the settlement agreement.
Nor do D.R. Horton’s and DRHI’s claims pertain to title. D.R. Horton and DRHI
assert that their claims in this suit are based upon the “duties, obligations,
covenants, agreements or warranties set forth in the Amended Contract” and
were therefore not released by the settlement agreement. Savannah, however,
is not a party to the Amended Contract. Therefore, it has no duties or obligations
under the Amended Contract and is not subject to any covenants, agreements,
or warranties set forth therein. See, e.g., Beaumont v. Excavators & Constrs.,
870 S.W.2d 123, 129 (Tex. App.—Beaumont 1993, writ denied) (“[A] contract
between other parties cannot create an obligation or duty on a non-contracting
party . . . .”).
In response to Savannah’s summary judgment motion, D.R. Horton and
DRHI offered the affidavit of Les Brannon. Brannon was the Region Counsel for
the South Region of D.R. Horton’s and DRHI’s parent company at the time the
settlement agreement and the Amended Contract were executed. In his capacity
18
as Region Counsel, Brannon was involved in the drafting and negotiation of the
settlement agreement and the Amended Contract on behalf of D.R. Horton and
DRHI. According to Brannon, paragraph 7 of the settlement agreement was
included to make clear that any references to releases in the settlement
agreement were not intended to release any party from the surviving duties,
obligations, covenants, agreements, or warranties set forth in the Amended
Contract or any other documents referenced in paragraph 7 of the settlement
agreement. Brannon further states that the phrase, “Notwithstanding anything
else to the contrary set forth in this Agreement,” was added to paragraph 7 to
expressly exclude those surviving duties, obligations, covenants, agreements,
and warranties from the mutual releases set forth in the settlement agreement.
Brannon claims D.R. Horton and DRHI would not have entered into the
settlement agreement if the existing surviving duties, obligations, covenants,
agreements, or warranties expressly set forth in the Amended Contract as not
being subject to any release had not been excluded from the mutual releases in
the Settlement Agreement. Brannon further states that the lots purchased under
the Horton Contract and Continental Contract are the subject of the second
lawsuit, and the subject matter of the second lawsuit is unrelated to the issues
litigated in the first lawsuit. Brannon’s affidavit testimony, however, is parol
evidence that cannot be properly considered to change the written terms of the
release. See David J. Sacks, P.C., 266 S.W.3d at 451. And to the extent that
this parol evidence contradicts the plain meaning of the settlement agreement,
19
this evidence is incompetent to change the agreement’s unambiguous language.
See White Oak Operating Co., LLC v. BLR Const. Cos., LLC, 362 S.W.3d 725,
734 (Tex. App.—Houston [14th Dist.] 2011, no pet.).
We conclude that the settlement agreement releases all of D.R. Horton’s
and DRHI’s claims against Savannah related to the Amended Contract and the
Savannah Addition, which include D.R. Horton’s and DRHI’s breach of contract,
breach of warranty, and negligence claims in this lawsuit. Therefore, Savannah
conclusively proved its affirmative defense of release as a matter of law, and the
trial court did not err by granting summary judgment. We overrule the portion of
sub-issue two challenging the summary judgment in favor of Savannah on its
release affirmative defense. Because we have concluded the trial court properly
granted Savannah’s motion for summary judgment on Savannah’s release
defense, which is dispositive of this appeal, we need not address the remainder
of sub-issues two and three. See Tex. R. App. P. 47.1.
VI. Conclusion
We hold the trial court did not abuse its discretion by not continuing the
submission date of Savannah’s summary judgment motions, and therefore, we
overrule D.R. Horton’s and DRHI’s first sub-issue. We also hold the trial court
did not err by rendering summary judgment in favor of Savannah on D.R.
Horton’s and DRHI’s fraudulent inducement claim against Savannah, and we
accordingly overrule that portion of D.R. Horton’s and DRHI’s third sub-issue.
We further hold that the trial court correctly granted summary judgment in favor
20
of Savannah on its affirmative defense of release, and we overrule that portion of
D.R. Horton’s and DRHI’s second sub-issue. Therefore, we need not address
the portions of D.R. Horton’s and DRHI’s second sub-issue challenging the
summary judgment in favor of Savannah on its res judicata, novation, and
limitations defenses or the portions of D.R. Horton’s and DRHI’s third sub-issue
challenging the no-evidence summary judgment in favor of Savannah on D.R.
Horton’s and DRHI’s claims for breach of contract, breach of warranty, and
negligence. The judgment of the trial court is affirmed.
ANNE GARDNER
JUSTICE
PANEL: GARDNER, MEIER, and GABRIEL, JJ.
DELIVERED: November 7, 2013
21