Target Corporation v. D&H Properties, LLC ( 2021 )

Affirmed in Part, Reversed and Rendered in Part, and Reversed and
Remanded in Part, and Opinion filed November 23, 2021.
In The
Fourteenth Court of Appeals
NO. 14-20-00125-CV
TARGET CORPORATION, Appellant
V.
D&H PROPERTIES, LLC, Appellee
On Appeal from the 11th District Court
Harris County, Texas
Trial Court Cause No. 2019-02168
OPINION
Target Corporation appeals a take nothing judgment declaring an easement
and an option relating to a parcel of land void and denying Target’s request for a
permanent injunction to enforce the easement.
The land in question is currently the location of a Target store. A prior owner
sold the majority of the land for commercial development, but due to environmental
contamination and ongoing remediation requirements concerning a small section of
the property, the grantor severed the contaminated section into a separate parcel,
excepted it from the transfer, and burdened it with a purchase option and easement
rights in favor of the surrounding land. The current owner of the contaminated
parcel, appellee D&H Properties, LLC, obtained the parcel through a conveyance
following a tax foreclosure sale and sought to avoid the effect of the easement.
Target sued D&H for violating the easement, for declaratory and injunctive relief,
and for refusing to sell the parcel pursuant to the purchase option. After a bench
trial, the trial court denied Target’s request for injunctive relief and signed a
judgment declaring the easement void and the option extinguished.
For the reasons explained below, we conclude that the trial court erred in
declaring the easement void. We render judgment in Target’s favor on its breach-
of-contract claim and its request for declaratory relief related to the easement.
Regarding Target’s challenge to the portion of the judgment denying its request for
specific performance of the purchase option, however, Target has not established
that the trial court erred in declaring the option extinguished by the tax foreclosure
sale. Therefore, we overrule Target’s issue and affirm the portion of the judgment
declaring the option extinguished. We remand this case for entry of permanent
injunctive relief and for consideration of attorney’s fees under the Declaratory
Judgment Act in light of our disposition.
Background
The easement and option at issue relate to real property once owned by
National Oilwell Varco (“NOV”). In 2002, NOV sold the property to a real estate
development company, Woodland Heights Development, L.P. We refer to this real
property as the “Dominant Tract.” When NOV transferred the Dominant Tract, it
excepted from the transfer and retained ownership of a 0.8944-acre parcel within the
Dominant Tract that was environmentally contaminated and subject to government-
2
mandated remediation. We refer to the 0.8944-acre contaminated parcel as the
“Environmental Parcel.”
When NOV transferred the Dominant Tract, it executed a Non-Exclusive
Easement Agreement (the “Original Easement Agreement”) in favor of Woodland
Heights. The Original Easement Agreement granted Woodland Heights a perpetual
non-exclusive easement over the surface of the Environmental Parcel for ingress and
egress, parking, landscaping, recreational purposes, and signage uses (the “Use
Easement”). NOV, on the other hand, retained the obligation to maintain the
Environmental Parcel, including the duty to comply with all continuing
environmental remediation activities. To assist NOV in satisfying this obligation,
the Original Easement Agreement granted NOV ingress and egress rights across the
Dominant Tract “for the purpose of permitting [NOV] to inspect and repair [the
Environmental Parcel], with reasonable prior notice to [Woodland Heights]” (the
“Access Easement”). NOV, however, could not exercise its access rights or use the
Environmental Parcel in a manner that interfered with Woodland Heights’
operations on or use of the Dominant Tract and the Use Easement. Also, the rights
and duties in the easement ran with the land. Specifically, the Original Easement
Agreement provided that all “rights granted and obligations imposed hereby shall
run with the land and shall be binding upon and inure to the benefit or burden, as the
case may be, of Grantor [NOV] and Grantee [Woodland Heights] and their legal
representatives, successors, and assigns as owners of Grantor’s Property and
Grantee’s Property, respectively.”
With the Original Easement Agreement, NOV and Woodland Heights signed
an option agreement, which provided Woodland Heights the option to purchase the
Environmental Parcel for a specified price depending on whether NOV completed
the environmental remediation.
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The deed, the Original Easement Agreement, and a Memorandum of Option
were recorded in the Harris County real property records in September 2002.
About two years later, the following relevant series of conveyances and
transactions occurred. Woodland Heights executed a Special Warranty Deed
conveying the Dominant Tract, together with additional land, to Sawyer Heights
Village, Ltd. (the “Sawyer Heights Deed”). The Sawyer Heights Deed referenced
the Original Easement Agreement and the option. Contemporaneously, Woodland
Heights and NOV amended the option1 to declare that: (1) the option period extends
until November 1, 2054; (2) the option runs with the land; and (3) the option inures
to the benefit of any subsequent owner of the Dominant Tract upon conveyance.
Hereafter, we refer to the option, as amended, as the “Option.” Woodland Heights
assigned the Option to Sawyer Heights when it conveyed the Dominant Tract.
After the conveyance of the Dominant Tract to Sawyer Heights, NOV, Sawyer
Heights, and another company, TPO-GP, Inc. (“TPO”),2 amended the Original
Easement Agreement to expand the Use Easement in the Dominant Tract’s favor to
expressly include the right to pave the Environmental Parcel (the “Amended
Easement Agreement”). As part of the Amended Easement Agreement, the parties
agreed that NOV could use the Environmental Parcel “for any uses which do not
interfere with (i) the use of [the Use Easement] or (ii) [Sawyer Heights’] operations
on, or use of, [Sawyer Heights’] property or the use or operations of any other party
having rights to occupy or use [the Dominant Tract].” The Amended Easement
Agreement stated, “[e]xcept as specifically modified hereby, the Original Easement
[Agreement] shall remain in full force and effect.”
1
As drafted, the option expired when Woodland Heights no longer owned the Dominant
Tract.
2
TPO owned an adjacent tract.
4
Sawyer Heights then conveyed by special warranty deed most of the
Dominant Tract to Target (the “Target Deed”). Sawyer Heights also assigned the
Option to Target. Target, Sawyer Heights, and TPO entered into an “Operations and
Easement Agreement,” which governed operations on the Dominant Tract. NOV
retained ownership of the Environmental Parcel and was not a party to the
Operations and Easement Agreement.
These transactions occurred in October 2004. The parties promptly recorded
the deeds, a Memorandum of the Amended Option, the assignments of the Option,
the Operations and Easement Agreement, and the Amended Easement Agreement in
the Harris County property records.
Target built a retail store and parking lot on the property, which included the
Dominant Tract; and Target paved over the Environmental Parcel as part of the
parking lot. The store opened in July 2006. Below is an aerial map of the property
provided by Target in its briefing. The Environmental Parcel is labeled
“Contaminated Parcel” in this depiction.
Years later, in 2014, NOV sold the Environmental Parcel to Biloxi Bacon
Enterprise Corporation. The deed referenced and attached the Original Easement
5
Agreement. Biloxi Bacon failed to pay 2014 ad valorem taxes on the property, and
Harris County filed a tax foreclosure suit. Biloxi Bacon answered the suit but did
not appear for trial, resulting in a default tax foreclosure judgment. Target did not
become aware of the tax foreclosure suit or judgment until after the judgment.
As the tax foreclosure proceedings were ongoing, Biloxi Bacon obtained in
2017 a default judgment against Woodland Heights purporting to void the Original
Easement Agreement. At that time, however, Woodland Heights no longer owned
the Dominant Tract and, in fact, was no longer in existence, having dissolved in
2006.
Pursuant to the tax foreclosure judgment, the taxing authority sold the
Environmental Parcel in 2018 to MRH Properties, LLC, an entity owned by
Mahmoud Harmouche, for $345,000. Through a series of deeds, the Environmental
Parcel is now owned by appellee D&H Properties, LLC, which is owned by
Harmouche and Ankur Desai, who are both experienced real estate developers.
D&H’s deed is expressly “subject to any and all restrictions, covenants, easements,
encroachments, and other matters of record to the extent the same are validly existing
and applicable to the Property.”
Desai testified that, before he and Harmouche purchased the Environmental
Parcel, they searched the Harris County real property records, but he could not recall
if they found the easement agreements or the Option. Neither Desai nor Harmouche
conducted a title search on the Environmental Parcel until after they purchased it.
According to Desai, he and Harmouche discovered the easement agreements and the
Option while obtaining title insurance.
As matters now stand, Target owns the Dominant Tract, and D&H owns the
Environmental Parcel. Since Target acquired the Dominant Tract, it has exercised
its right to use the Use Easement continuously. Target paved the Environmental
6
Parcel and used it for guest and employee parking and for truck access to its loading
dock.
But in January 2019, D&H installed a chain-link fence on the parking lot
around the Environmental Parcel’s boundary, which prevented Target from
exercising some of its rights under the Use Easement. The following is an aerial
photograph provided by Target, showing the general location of the chain link fence
and the Environmental Parcel (labeled on this photograph as the “Servient Parcel”):
Target’s preferred truck access route to its loading dock is shown in green in the
above photograph.
Target sued D&H on January 10, 2019, seeking injunctive relief and damages
for breach of the Use Easement. The trial court issued a temporary restraining order,
pursuant to which Target removed the fence. The trial court then issued a temporary
injunction, prohibiting D&H from obstructing, interfering with, or encroaching on
Target’s use and enjoyment of the Use Easement. In August 2019, the trial court
modified the temporary injunction to allow D&H to lease the Environmental Parcel
7
to a third party for parking. The next month, Target attempted to exercise the Option
to purchase the Environmental Parcel, but D&H refused to close the sale.
The suit proceeded to a bench trial. In its live pleadings, Target sought the
above-described relief, as well as damages for tortious interference with property
rights, breach of the Option agreement, and declaratory relief. Regarding the Use
Easement, D&H pleaded that, as relevant: (1) it is void under the statute of frauds;
(2) it was not conveyed to Sawyer Heights and thus could not have been conveyed
to Target; and (3) it is void because it prohibits D&H’s use of the Environmental
Parcel. Regarding the Option, D&H contended that it was extinguished by the tax
foreclosure sale.
The trial court issued a final judgment in D&H’s favor, declaring the Use
Easement void and the Option extinguished and ruling that Target take nothing on
its other claims against D&H. The trial court signed the following findings of fact
and conclusions of law that same date:
Findings of Fact:
1. The easement (the “Easement”) that is the subject of this case
provides no point of ingress or egress or any precise location for its
use and Target has provided no contemporaneous evidence of any
understanding as to location or point of ingress or egress between
the parties to the Easement.
2. Target objects to D&H’s use of its property for any commercial
purpose and cannot articulate any commercial purpose to which it
would not object.
3. Target had notice of the tax foreclosure sale.
Conclusions of Law:
1. Easements are interests in land and are subject to the statute of
frauds. Pick v. Bartel, 659 S.W.2d 636, 637 (Tex. 1983).
2. An easement is void and violates the statute of frauds if it does not
sufficiently describe the interest conveyed. For an easement to be
8
enforceable a surveyor must be able to go onto the property and be
able to specifically locate the easement area. Vrabel v. Donahoe
Creek Watershed Authority, 545 S.W.2d 53 (Tex. App.—Austin
1976, no writ).
3. The Easement is void and unenforceable. The Easement does not
sufficiently describe the interest conveyed because it has no means
to describe its location or any point of ingress or egress or areas
where parking is permitted. The Easement thus violates the statute
of frauds.
4. The Easement is void and unenforceable because as interpreted by
Target it prohibits use by D&H, as the owner. Baker v. Henderson,
153 S.W.2d 465, 471 (Tex. 1941).
5. D&H’s immediate predecessor in title acquired the property
described in the Easement at a tax foreclosure sale. Thus, D&H has
good and perfect title subject only to the exceptions described in
Section 34.01(n) of the Texas Tax Code.
6. Texas law provides that a mortgagee must be a party to a tax lawsuit
but that no other holder of a property interest is entitled to notice nor
required to be a party. Sec. State Bank & Trust v. Bexar Cty., 397
S.W.3d 715 (Tex. App.—San Antonio 2012, pet. denied).
7. The rights of a holder of an option to purchase property are inferior
to a tax lien. See § 32.05 Texas Tax Code.
8. The option to purchase was extinguished by the tax sale.
9. Section 33.54 of the Texas Tax Code provides a remedy to parties
to challenge a tax sale. Jordan v. Bustamante, 158 S.W.3d 29 (Tex.
App.—Houston [14th Dist.] 2005, pet. denied).
Target objected to the judgment and findings and conclusions, and it requested
additional or amended findings and conclusions. D&H also requested additional
findings and conclusions. The trial court issued the following additional findings
and conclusions:
Additional Findings of Fact:
1. Target Corporation (“Target”) has 18-wheeler vehicular access to its
loading dock without traversing D&H Properties LLC’s (“D&H”)
property. The access using D&H’s property is more convenient.
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2. Target’s customers use D&H’s property only for overflow parking.
3. Ankur Desai is an experienced real estate investor and broker and is
qualified to provide expert opinion testimony about the values of
commercial property.
4. Target’s interpretation of the Easement excluding D&H from using
its own property means D&H’s property is worthless and has no
value.
5. Target has never paid any real property taxes on D&H’s property.
6. Target was aware of D&H’s intent to construct a fence for many
weeks in advance.
7. Ankur Desai visited with Target’s assistant manager, Erika Baker,
the day the fence was constructed and she expressed no concerns to
Mr. Desai.
8. Mr. Desai told Ms. Baker to call him if Target needed access through
the fence and gave her his cellphone number.
9. There is normally one general merchandise 18-wheeler that arrives
at night to use Target’s loading dock. The driver uncouples the
container for later unloading, attaches an empty trailer, and leaves.
There is generally one 18-wheeler that delivers food per day.
Vendor trucks unload at places other than the loading dock.
10.No vehicles owned by Target park on D&H’s property.
Additional Conclusions of Law:
1. An exception in a deed that lists an easement means the property
conveyed is burdened by the easement. Magee v. Hambleton, 2009
WL: 2619425 (Tex. App.—Fort Worth 2009, pet. denied).
2. The exception of the Easement in the deed from Woodland Heights
Development, L.P. (“Woodland Heights”) to Sawyer Heights, Ltd.
(“Sawyer Heights”) provided notice that National Oilwell, L.P.
(“NOV”) had access for the limited purpose of its remediation
obligations.
3. An express exception in a deed of an easement controls over an
implied transfer or assignment of an easement. Mehan v. Babbel,
2018 WL 1751155 (Tex. App.—Amarillo 2018, pet. denied).
4. D&H did not breach a contract with Target.
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5. While courts have jurisdiction to declare a judgment of another court
void, the parties to both suits must be the same. The parties to the
underlying tax suit are not the same parties as in this case, therefore
the underlying judgment cannot be declared void. Armentor v.
Kern, 178 S.W.3d 147, 149 (Tex. App.—Houston [1st Dist.] 2005,
no pet.).
Target timely appealed.
Issues Presented
Target presents a single overarching issue: whether the trial court erred by
rendering judgment in D&H’s favor. Target includes three sub-issues: (1) is the
Use Easement enforceable by Target; (2) did the Option survive the tax foreclosure
sale; and (3) is Target entitled to judgment on its claims?
Standard of Review
The trial court held that the Use Easement is void and that the Option “has
been extinguished.” We review a trial court’s conclusions of law de novo to
determine whether they are correct. See Material P’ships, Inc. v. Ventura, 102
S.W.3d 252, 257 (Tex. App.—Houston [14th Dist.] 2003, pet. denied). Whether an
unambiguous agreement, including an easement, is valid and enforceable is a legal
question, which we likewise review de novo. Kennebrew v. Harris, 425 S.W.3d
588, 597 (Tex. App.—Houston [14th Dist.] 2014, pet. denied); see Texan Land &
Cattle II, Ltd. v. ExxonMobil Pipeline Co., 579 S.W.3d 540, 543 (Tex. App.—
Houston [14th Dist.] 2019, no pet.); Hubert v. Davis, 170 S.W.3d 706, 711 (Tex.
App.—Tyler 2005, no pet.) (“We review the trial court’s interpretation of restrictive
covenants and easements de novo.”).
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Analysis
A. Is the Use Easement enforceable by Target?
We begin with Target’s first issue: the Use Easement’s enforceability.
1. Law governing easement interpretation
A property owner’s right to exclude others from its property is “one of the
most essential sticks in the bundle of rights that are commonly characterized as
property.” Marcus Cable Assocs., L.P. v. Krohn, 90 S.W.3d 697, 700 (Tex. 2002).
But a landowner may relinquish the right to exclude others by granting an easement.
See id. An easement is a nonpossessory property interest authorizing its holder to
use another’s property for particular purposes. Lance v. Richardson, 543 S.W.3d
723, 736 (Tex. 2018); Severance v. Patterson, 370 S.W.3d 705, 721 (Tex. 2012) (op.
on reh’g).
The servient estate holder, that is, the owner of the underlying fee, cannot
interfere with the dominant estate holder’s use of an easement for the easement’s
purposes. Atmos Energy Corp. v. Paul, 598 S.W.3d 431, 443 (Tex. App.—Fort
Worth 2020, no pet.). Thus, any use by the servient estate holder that interferes with
the exercise of the dominant estate holder’s rights “must yield.” Id.; see also
Severance, 370 S.W.3d at 721 (“Because the easement holder is the dominant estate
owner and the land burdened by the easement is the servient estate, the property
owner may not interfere with the easement holder’s right to use the servient estate
for the purposes of the easement.”).
Nothing passes by implication through an easement “except what is
reasonably necessary” to fairly enjoy the rights expressly granted. Marcus Cable,
90 S.W.3d at 701. If a particular purpose is not provided for in the grant, the holder
of the easement may not use the property for that purpose. See id. The emphasis
12
that Texas law places upon an easement’s express terms serves important public
policies by promoting certainty in land transactions. Id. at 702. A potential
purchaser of an easement must be able to safely rely upon granting language. Id.
And those who grant easements should be assured that their conveyances will not be
construed to undermine private property rights beyond what was intended in the
grant. Id. If a use does not serve the easement’s purpose, it becomes an
“unauthorized presence on the land.” Id. at 703. Additionally, a non-exclusive
easement, such as is present here, generally permits the servient estate holder to share
in the benefit of the easement. See First Colony Cmty. Servs. Assoc., Inc. v. Valentz,
No. 01-16-00060-CV, 2017 WL 711740, at *4 (Tex. App.—Houston [1st Dist.] Feb.
23, 2017, no pet.) (mem. op.).
As easement agreements are contracts, we view them with an eye toward
Texas’s public policy that “strongly favors freedom of contract”—a liberty with
which courts are not to “lightly interfere.” See Shields Ltd. P’ship v. Bradberry, 526
S.W.3d 471, 481 (Tex. 2017). Parties have the right to contract as they see fit, so
long as their agreement does not violate the law or public policy. Id. Absent
compelling reasons, we must respect and enforce the terms of a contract that the
parties have freely and voluntarily entered. Philadelphia Indem. Ins. Co. v. White,
490 S.W.3d 468, 471 (Tex. 2016).
When construing an easement, “courts deploy the rules of contract
interpretation and look to the easement’s express terms to determine its scope.” Sw.
Elec. Power Co. v. Lynch, 595 S.W.3d 678, 686 (Tex. 2020) (citing DeWitt Cty.
Elec. Coop., Inc. v. Parks, 1 S.W.3d 96, 100 (Tex. 1999)). As in other contract
interpretation cases, courts look to the entirety of the easement and “harmonize its
terms to give effect to all the provisions.” Id. If the easement’s terms can be given
a definite or certain meaning, “then the language is not ambiguous, and the court is
13
obligated to interpret the contract as a matter of law.” DeWitt Cty. Elec. Coop., Inc.,
1 S.W.3d at 100.
With these principles in mind, we turn to Target’s arguments concerning the
Use Easement in today’s appeal.
2. D&H did not establish that the Use Easement is void.
The trial court declared the Use Easement void and unenforceable under
various legal theories asserted by D&H. We address each theory in turn.
a. The Original Easement Agreement satisfies the statute of frauds.
Because easements are real property interests, easement agreements are
subject to the statute of frauds. See Pick v. Bartel, 659 S.W.2d 636, 637 (Tex. 1983);
see also Tex. Bus. & Com. Code § 26.01 (requiring that certain agreements must be
in writing). To satisfy the statute of frauds, an easement agreement must furnish
within itself or by reference to other identified writings then in existence means or
data by which the servient estate may be identified with certainty. See Pick, 659
S.W.2d at 637; see also BSG-Spencer Highway Joint Venture, G.P. v. Muniba
Enters., Inc., No. 01-15-01109-CV, 2017 WL 3261365, at * 5-7 (Tex. App.—
Houston [1st Dist.] Aug. 1, 2017, pet. denied) (mem. op.); Double Diamond, Inc. v.
Barber, No. 11-02-00277-CV, 2003 WL 21804872, at *2-3 (Tex. App.—Tyler Aug.
7, 2003, no pet.) (mem. op.) (“The easement must provide enough information from
which the court can determine the intent of the parties, as well as the essential terms
of the easement, and must also provide an adequate description of the location of the
easement without resort to extrinsic evidence.”).
The trial court held that the Use Easement violates the statute of frauds
because it “does not sufficiently describe the interest conveyed because it has no
means to describe its location or any point of ingress or egress or areas where parking
14
is permitted.” The court cited Vrabel v. Donahoe Creek Watershed Authority, 545
S.W.2d 53 (Tex. App.—Austin 1976, no writ). In Vrabel, the purported easement
was described as:
BEING 111.0 acres, more or less, out of a 250.5 acre tract of land in the
Basil Durbin Survey, as more fully described in a Warranty Deed dated
January 1, 1953, from Erwin Mankins and wife, Mayna Allene
Mankins, to Leslie E. Moore and wife, Lela Mae Moore as recorded in
Volume 385, Page 599, of the Deed Records of Williamson County,
Texas, to which reference is made for all purposes.
Id. at 54. The Austin Court of Appeals declared this easement void: “Inasmuch as
the easement before us does not furnish within itself a description to its location, nor
is there any reference to outside aids to help in determining its location, the easement
must fail for lack of an adequate description.” Id.
The Original Easement Agreement’s relevant language, however, differs
materially from that at issue in Vrabel. The agreement provides in pertinent part:
WHEREAS, Grantee [Woodland Heights] is the owner in fee simple of
that certain real property situated in Harris County, Texas, as more
particularly described on Exhibit A attached hereto and made a part
hereof for all purposes (“Grantee’s Property”);
WHEREAS, Grantor [NOV] is the owner in fee simple of (i) that
certain real property situated in Harris County, Texas, as more
particularly described on Exhibit B attached hereto and made a part
hereof for all purposes (“Tract One”), and (ii) that certain real
property situated in Harris County, Texas, as more particularly
described on Exhibit C attached hereto and made a part hereof for all
purposes (“Tract Two”) (Tract One and Tract Two are collectively
referred to herein as “Grantor’s Property”);
WHEREAS, Grantee desires, and Grantor is willing to grant, a
perpetual, non-exclusive easement over the surface only of Grantor’s
Property, for the Limited Purposes (hereinafter defined);
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NOW THEREFORE, in consideration of the premises and other good
and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Grant. Grantor does hereby grant, sell and convey unto
Grantee, its successors and assigns, a perpetual, non-exclusive
easement over the surface only of Grantor’s Property (the “Easement”
for the Limited Purposes.
2. Limited Purposes. The Limited Purposes (herein so
called) for which the Easement may be used are ingress and egress,
parking, landscaping, recreational purposes and signage uses;
however, no such activities shall be conducted in a manner which
violates the Certification of Completion (collectively, the “Completion
Certificates”) issued by the Texas National Resources Conservation
Commission (now called Texas Commission on Environmental Quality
and hereinafter called the “TCEQ”), copies of which are attached hereto
as Exhibit “D” (as to Tract One) and Exhibit “E” (as to Tract Two) and
made a part hereof for all purposes hereunder.
(Italics added).
Exhibits A, B, and C, which are attached to the agreement and recorded in the
property records along with it, contain metes and bounds descriptions of NOV’s and
Woodland Heights’ respective properties. It is undisputed that Exhibit A describes
the Dominant Tract and that Exhibit B describes the Environmental Parcel.3 And as
the Original Easement Agreement makes clear, NOV granted Woodland Heights an
easement over the entire surface estate of the Environmental Parcel, for the limited
purposes of “ingress and egress, parking, landscaping, recreational purposes and
signage uses.”
We conclude that the trial court’s ruling on D&H’s statute of frauds defense
is not supported by Vrabel or like cases, in which the easement covered only some
unidentified portion of the servient estate. See Vrabel, 545 S.W.2d at 54 (easement
3
Exhibit C appears to describe additional acreage retained by NOV, ultimately conveyed
to Target, and not part of this dispute.
16
described as “111.0 acres, more or less, out of a 250.5 acre tract of land” failed “for
lack of an adequate description”); see also Double Diamond, 2003 WL 21804872,
at *3 (holding that easement violated the statute of frauds because the language of
the easement—“via an agreed, acceptable route”—did not “sufficiently describe the
conveyance and [did] not sufficiently show the intention of the parties”). No such
deficiencies in easement description exist here. Similar easements, often referred to
as “general” or “blanket” easements, may be more commonly used in the context of
utility easements;4 but the agreement’s grant of easement rights over the entire
surface area of the servient estate, coupled with a sufficient description of the
servient estate, does not violate the statute of frauds. Cf., e.g., BSG-Spencer
Highway, 2017 WL 3261365, at *6-8 (citing cases and determining that easement
satisfied statute of frauds because it provided a valid legal description of the servient
estate and permitted ingress and egress over “those portions of [the servient estate]
which are from time to time developed for ingress and egress”); Placke v. Lee-
Fayette Counties W.C.I.D. No. 1, No. 03-04-00096-CV, 2005 WL 1034075, at *4
(Tex. App.—Austin May 5, 2005, pet. denied) (mem. op.) (“General language
specifying a purpose for the easement without defining its precise parameters has
been held sufficient to confer an easement.”).
Simply put, the Original Easement Agreement contains the essential terms of
a contract, expressed with such certainty and clarity that it may be understood
without recourse to parol evidence to show the intention of the parties. See Pick,
4
E.g., Sw. Elec. Power Co., 595 S.W.3d at 689 (“Indeed, this Court has recognized the
existence of general easements that do not require a fixed width.”); Amos Energy Corp. v. Paul,
598 S.W.3d 431, 447 (Tex. App.—Fort Worth 2020, no pet.) (explaining that a blanket easement
is an easement “without a metes and bounds description of its location on the property”: “It is not
necessary . . . for the easement description to be a smaller area than the entire servient estate.”).
17
659 S.W.2d at 637. Accordingly, the trial court erred in determining that the Use
Easement violates the statute of frauds.
b. The Use Easement is not void as a prohibition of use.
The trial court also determined that “[t]he Easement is void and unenforceable
because as interpreted by Target it prohibits use by D&H, as the owner.” The only
authority D&H offers in support of its theory is Baker v. Henderson, 153 S.W.2d
465, 471 (Tex. 1941), which the trial court cited. Baker includes statements such as,
“[i]t appears well settled that restrictions which amount to a prohibition of use of the
property granted are void,” and “it is contrary to the well recognized business policy
of the country to tie up real estate where the fee is conveyed with restrictions and
prohibitions as to its use; and, hence, in the construction of deeds containing
restrictions and prohibitions as to the use of the property by a grantee, all doubts
should, as a general rule, be resolved in favor of a free use of property and against
restrictions.” Id. at 470-71.
In Baker, a landowner sold a residential tract to purchasers who intended to
build a house on it. The property was a corner lot, adjoining two streets known as
Forest Trail and Bridal Path. Id. at 466. The deed contained a restriction prohibiting
the construction of any buildings closer than 75 feet from the “property line fronting
on any street adjoining said premises.” Id. The trial court found that when the
purchasers bought the lot, they did so for the purpose of erecting a residence, and
that the seller waived the 75-foot set-back restriction and agreed that the purchasers
could build their home at a distance of less than 75 feet from Bridal Path. Id. at 466-
67.
After the sale, neighbors sued for an injunction restraining the purchasers
from building a house without observing the deed set-back restrictions as to both
18
adjoining streets. The trial court ruled in the purchasers’ favor, and the court of
appeals affirmed. Id. at 467.
The supreme court also affirmed. Though it construed the deed restrictions in
favor of the “free use of the land,” it did so in the context of construing restrictive
deed language it concluded was ambiguous. Id. at 470-71. Depending on the
covenant’s construction, the appellees would have been precluded from building a
home on their lot, rendering their land utterly valueless. Id. at 471. The Baker court
relied on the policy against the conveyance of unusable land to support a narrow
reading of an ambiguous restrictive covenant; it did not apply the doctrine to hold
that the covenant was void. Id. (“It is our duty, of course, to give effect to this
restriction if we can reasonably do so and save the conveyance from being void.”).
It construed an ambiguous restriction to avoid “destroy[ing] the grant, so far as the
purpose for which the property was acquired is concerned.” Id. at 470 (“Being in
derogation of the fee conveyed by the deed, if there be any ambiguity in the terms
of the restrictions, or substantial doubt of its meaning, the ambiguity and doubt
should be resolved in favor of the free use of the land.”).
For several reasons, Baker is not applicable to the facts of today’s case. First,
the Baker court’s analysis was driven by the existence of an ambiguous deed
restriction. But no party has alleged or argued that the Use Easement was ambiguous
nor has anyone advanced competing constructions of it. And we conclude the
easement is unambiguous. E.g., Wenske v. Ealy, 521 S.W.3d 791, 794 (Tex. 2017).
Second, the deed restrictions in Baker did not benefit the neighboring landowners
but were merely personal covenants, see Baker, 153 S.W.2d at 469-70; whereas,
here, the Use Easement specifically benefits the Dominant Tract. Finally, when the
purchasers in Baker bought the land, they did so with the understanding—based on
the seller’s agreement—that they could use the land acquired to build the desired
19
residence within 75 feet of Bridal Path. Id. at 466-67. The same is not true here.
MRH acquired the property while on notice of the easement,5 and D&H presented
no evidence that the purchase was based on any representation or agreement that it
would not have to comply with the easement. Thus, Baker does not support a
construction of the Use Easement—or a declaration voiding it—in favor of D&H’s
“free use” of the Environmental Parcel.
Our holding finds strong support in a recent decision of the Supreme Court of
Texas rejecting a similar argument. See Teal Trading & Dev., LP v. Champee
Springs Ranches Prop. Owners Ass’n, 593 S.W.3d 324 (Tex. 2020). There, Teal
purchased real property with knowledge that a restrictive access easement burdened
the property acquired. Likewise, MRH bought the Environmental Parcel at a tax
foreclosure sale while on notice the parcel was burdened by the Use Easement and
that the surface estate was paved and then in use as part of a Target store parking lot.
Similar to D&H, Teal sought to have the easement declared void on public policy
grounds because it is an “improper restraint on the use and alienation of real
property.” Id. at 329. The supreme court disagreed, finding Teal’s appeal to public
policy not “particularly sympathetic.” Id. at 339. The court reiterated that “[c]ourts
should refrain from nullifying a transaction because it is contrary to public policy,
‘unless the transaction contravenes some positive statute or some well-established
rule of law.’” Id. at 338. The court clarified that when the legislature has spoken on
a topic, its statutory enactments are expressions of public policy. Id. at 339.
According to the Teal court,
5
An instrument that is properly recorded in the proper county is notice to all persons of its
existence. Tex. Prop. Code § 13.002. Purchasers of real property are deemed to have constructive
notice of matters reflected in real property records chain of title. See Noble Mortg. & Inv., LLC v.
D&M Vision Inv., LLC, 340 S.W.3d 65, 76 (Tex. App.—Houston [1st Dist.] 2011, no pet.)
(“Recorded instruments in a grantee’s chain of title generally establish an irrebuttable presumption
of notice.”); Jones v. Fuller, 856 S.W.2d 597, 603 (Tex. App.—Waco 1993, writ denied).
20
The legislature has spoken extensively about restrictive covenants, both
upholding their enforcement and setting limits. These legislative
decisions to regulate and even prohibit some restrictive covenants—but
not restrictive easements like this one—militate against this Court’s
exercise of its common-law authority. The legislature has told us that
a restrictive covenant not proscribed by statute should be “liberally
construed to give effect to its purpose and intent.” Tex. Prop. Code
§ 202.003(a).
Id. The court went on to explain that although covenants restricting the free use of
land “are not favored,” courts have enforced them for over a century. Id. In
declining to declare a restrictive access easement void, the court concluded, “[w]e
can discern no ‘well-established rule of law’ that compels us to put a common-law
thumb on the public policy scale either way in this case.” Id.
For these reasons, we conclude the Use Easement is neither invalid nor
unenforceable on the ground that it prohibits D&H’s free use of the Environmental
Parcel. Teal Trading & Dev., LP v. Champee Springs Ranches Prop. Owners Ass’n,
534 S.W.3d 558, 576 (Tex. App.—San Antonio 2017) (“Teal Trading I”) (holding
that where neither party alleged and court did not find easement ambiguous,
easement should be construed in favor of validity), aff’d, Teal Trading & Dev., LP
v. Champee Springs Ranches Prop. Owners Ass’n, 593 S.W.3d 324 (Tex. 2020)
(“Teal Trading II”); see also Teal Trading II, 593 S.W.3d at 338-40 (declining to
declare restrictive access easement void as against public policy); Wilmoth v. Wilcox,
734 S.W.2d 656, 657 (Tex. 1987) (explaining that if there is ambiguity or doubt as
to intent, a restrictive covenant is to be strictly construed against the party seeking
to enforce it and in favor of the free and unrestricted use of the premises). Instead,
we construe the unambiguous Use Easement according to its plain terms while
liberally “giv[ing] effect to its purposes and intent.” Tex. Prop. Code § 202.003(a).
21
Moreover, even if Baker’s reasoning applied to the easement language at
issue, we agree with Target that D&H did not prove that the Environmental Parcel
is wholly worthless. E.g., Teal Trading I, 534 S.W.3d at 581 (concluding that trial
court did not err in granting summary judgment in Champee Springs’s favor on Teal
Trading’s affirmative defense of prohibition of use because Teal Trading did not
come forth with any evidence to counter no-evidence motion filed by Champee
Springs). The only evidence D&H presented to support its claim that Target’s use
of the Use Easement caused the Environmental Parcel to lose all value was the
following testimony from Desai:
Q. Okay. And if you were unable to even use this property for parking,
is there any commercial use that you could think of that the property
could be used for?
A. I do not believe so.
Q. And if you can’t use it for -- even for parking, what is your opinion
of the value of the property?
A. It would not have value.
Q. So, in essence, would it be worthless?
A. Yes, it would be worthless.
A property owner, such as Desai, is qualified to testify to the value of his own
property, so long as he testifies specifically to its market value, not “intrinsic or some
other speculative value of the property.” Nat. Gas Pipeline Co. of Am. v. Justiss,
397 S.W.3d 150, 155-56 (Tex. 2012). This requirement is generally met by asking
the witness if he is familiar with the market value of his property. Id. Thus, under
the Property Owner Rule, the witness’s testimony must meet the same requirements
as any other expert’s testimony:
Because property owner testimony is the functional equivalent of
expert testimony, it must be judged by the same standards. Thus, as
with expert testimony, property valuations may not be based solely on
22
a property owner’s ipse dixit. An owner may not simply echo the
phrase “market value” and state a number to substantiate his diminished
value claim; he must provide the factual basis on which his opinion
rests. This burden is not onerous, particularly in light of the resources
available today. Evidence of price paid, nearby sales, tax valuations,
appraisals, online resources, and any other relevant factors may be
offered to support the claim. But the valuation must be substantiated;
a naked assertion of “market value” is not enough. Of course, the
owner’s testimony may be challenged on cross-examination or refuted
with independent evidence. But even if unchallenged, the testimony
must support a verdict, and conclusory or speculative statements do not.
Id. at 159.
Here, Desai provided no supporting factual basis for his statement that the
Environmental Parcel is worthless if the Use Easement is enforced. Desai did not
discuss “market value”; nothing in his testimony shows that his value testimony was
based on the market; and he did not testify that he was familiar with the market. See
id. Thus, his valuation testimony amounts to mere ipse dixit, which is insufficient
to support his claim that the Environmental Parcel is worthless. See id. Further, his
testimony “provides only his guess as to his property’s diminution in value, and such
speculation will not support a judgment.” Id. at 161.
We conclude that the trial court erred in declaring the Use Easement void and
unenforceable as a prohibition of use.
3. Target holds the Use Easement.
In a final point, D&H contends that we may affirm the trial court’s judgment
on the theory that Target never acquired the Use Easement because the easement did
not convey from Woodland Heights to Sawyer Heights, and thus, the easement could
not have conveyed to Target. The trial court did not make any specific findings or
conclusions in D&H’s favor on this argument, but some of the trial court’s
23
conclusions could be interpreted as implicitly supporting it. For example, the trial
court concluded:
• An exception in a deed that lists an easement means the property
conveyed is burdened by the easement. . . .
• The exception of the Easement in the deed from [Woodland
Heights] to [Sawyer Heights] provided notice that [NOV] had
access for the limited purpose of its remediation obligations. . . .
• An express exception in a deed of an easement controls over an
implied transfer or assignment of an easement. . . .
To the extent that these conclusions indicate that the Sawyer Heights Deed shows
that the Dominant Tract was burdened by the Access Easement, we agree. But to
the extent these conclusions adopt D&H’s argument that the Use Easement was not
conveyed to Sawyer Heights, we disagree.
The Original Easement Agreement expressly dictates that the “rights granted
and obligations imposed hereby shall run with the land” and are binding on NOV’s
and Woodland Heights’ successors and assign as owners of the properties. “An
easement in which the benefits are for a specific parcel of land, regardless of the
identity of the owner, are easements appurtenant.” Machala v. Weems, 56 S.W.3d
748, 754 (Tex. App.—Texarkana 2001, no pet.); see Drye v. Eagle Rock Ranch, Inc.,
364 S.W.2d 196, 203 (Tex. 1962) (explaining that an easement appurtenant benefits
the property to which it is attached; it cannot be separated from the owner’s rights
in the land, and it passes with the property). An easement appurtenant passes by a
deed’s use of the word “appurtenant,” but such an easement usually passes even
without such an express reference in the deed. See Holmstrom v. Lee, 26 S.W.3d
526, 531 (Tex. App.—Austin 2000, no pet.); see also Aery v. Hoskins, Inc., 493
S.W.3d 684, 700 (Tex. App.—San Antonio 2016, pet. denied) (“Therefore, any
24
appurtenance (benefit or burden) to the conveyed land passes to the grantee even if
not specified.”).
A warranty deed passes all the estate owned by the grantor at the time of the
conveyance unless there are reservations or exceptions that reduce the estate
conveyed. Day & Co., Inc. v. Texland Petroleum, Inc., 786 S.W.2d 667, 668 (Tex.
1990). The words “exception” and “reservation,” though at times used
interchangeably, each have their own separate meaning. Klein v. Humble Oil &
Refining Co., 67 S.W.2d 911, 915 (Tex. App.—Beaumont 1934), aff’d, 86 S.W.2d
1077 (Tex. 1935). A reservation is the creation of a new right in favor of the grantor,
while an exception operates to exclude some interest from the grant. Wenske, 521
S.W.3d at 806 (discussing exception); Patrick v. Barrett, 734 S.W.2d 646, 647 (Tex.
1987) (discussing reservation). Thus, to retain an appurtenant right, such as an
easement, “a grantor must specifically reserve it for himself.” Aery, 493 S.W.3d at
700.
In today’s case, the Sawyer Heights Deed conveyed from Woodland Heights,
as grantor, to Sawyer Heights, as grantee, “all rights and appurtenances thereto in
anywise belonging to Grantor.” At the time of the conveyance, the Use Easement
was an easement appurtenant belonging to Woodland Heights. Thus, the Use
Easement passed to Sawyer Heights through the express language of the deed, unless
there are reservations or exceptions reducing the estate conveyed.
The Sawyer Heights Deed states that the conveyance is “subject to” the items
listed in the “Permitted Exceptions.” One of the items listed in the Permitted
Exceptions is the Easement Agreement. D&H asserts that the Sawyer Heights Deed
thereby “excepted” the Use Easement, meaning that Woodland Heights retained the
Use Easement and did not convey it with the Dominant Tract. See generally Magee
25
v. Hambleton, No. 02-08-00441-CV, 2009 WL 2619425, at *3-5 (Tex. App.—Fort
Worth Aug. 25, 2009, pet. denied) (mem. op.).
We disagree that, by conveying the Dominant Tract subject to the “permitted
exceptions,” including the Easement Agreement, Woodland Heights sought to
reserve the Easement Agreement for itself. As explained above, the Easement
Agreement contained two easements: (1) the Use Easement, benefitting the
Dominant Tract and burdening the Environmental Parcel; and (2) the Access
Easement, benefitting the Environmental Parcel and burdening the Dominant Tract.
In other words, the Easement Agreement included a benefit—the Use Easement—
that was transferred with the land, and a burden—the Access Easement—that the
land was “subject to.” By including the Easement Agreement in the Permitted
Exceptions, Woodland Heights notified Sawyer Heights that the Dominant Tract
was burdened by the Access Easement. See, e.g., id. at *5 (holding that deed
conveying property subject to an ingress-egress easement showed existence of
easement burdening conveyed property); see also Moctezuma v. Upton, No. 14-94-
00009-CV, 1995 WL 681294, at *2 (Tex. App.—Houston [14th Dist.] Nov. 16,
1995, writ denied) (op. on reh’g, not designated for publication) (holding that deed
conveying property “subject to” road easement established existence of easement
encumbering grantor’s interest).
Here, the Sawyer Heights Deed does not expressly reserve the Use Easement;
thus, it was conveyed with the Dominant Tract to Sawyer Heights. In turn, Sawyer
Heights conveyed the Use Easement to Target via the Target Deed, which conveyed
the Dominant Tract, “together with and including . . . all hereditaments,
appurtenances, easements and right of way thereunto belonging or in any way
appertaining . . . .” (Emphasis added). Target thus holds the Use Easement.
* * *
26
Accordingly, we hold that the Use Easement is not void and unenforceable for
any of the reasons D&H asserted and that Target acquired the Use Easement through
the various conveyances at issue in this case. The Use Easement is valid and
enforceable by Target, and we sustain Target’s first sub-issue.
B. Did the Option survive the tax foreclosure sale?
The trial court also determined that the tax foreclosure sale extinguished the
Option. Target contends that the trial court erred in so holding.
1. Target has not established that it was entitled to notice of the tax
foreclosure suit, and it received notice of the tax foreclosure sale.
Target’s first argument rests on due process concerns related to tax foreclosure
cases involving lienholders. A record lienholder possesses a legally protected
property interest. Sec. State Bank & Trust v. Bexar County, 397 S.W.3d 715, 721
(Tex. App.—San Antonio 2012, pet. denied) (citing Mennonite Bd. of Missions v.
Adams, 462 U.S. 791, 798 (1983); Sadeghian v. City of Denton, 49 S.W.3d 403, 406
(Tex. App.—Fort Worth 2000, pet. denied)). Before “any action that will affect a
protected property interest, due process requires ‘notice reasonably calculated, under
all circumstances, to apprise interested parties of the pendency of the action and
afford them an opportunity to present their objections.’” Id. (quoting Mullane v.
Cent. Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950)). Texas courts generally
hold that a lienholder must be joined in a delinquent tax suit to be bound by it. See
id. at 722; Mem’l Park Med. Ctr., Inc. v. River Bend Dev. Grp., L.P., 264 S.W.3d
810, 814 (Tex. App.—Eastland 2008, no pet.); Jordan v. Bustamante, 158 S.W.3d
29, 38 (Tex. App.—Houston [14th Dist.] 2005, pet. denied). A trial court’s judgment
foreclosing a tax lien is valid against the parties joined in the suit, but lienholders
27
who are not joined are not bound by the judgment.6 E.g., Sec. State Bank & Trust,
397 S.W.3d at 722; John K. Harrison Holdings, LLC v. Strauss, 221 S.W.3d 785,
791 (Tex. App.—Beaumont 2007, pet. denied); Jordan, 158 S.W.3d at 38-39. Thus,
when a record lienholder receives no notice of the delinquent tax suit or subsequent
tax sale, due process requires that the purchaser at the tax sale takes the property
subject to the lienholder’s lien. See Sec. State Bank & Trust, 397 S.W.3d at 724-25;
Strauss, 221 S.W.3d at 791; Jordan, 158 S.W.3d at 38-39.
An option agreement, however, “does not pass title or convey an interest in
property.” N. Shore Energy, L.L.C. v. Harkins, 501 S.W.3d 598, 605 (Tex. 2016)
(per curiam). Instead, it “merely gives the optionee the option to purchase property
or execute a lease within a certain time period.” Id. Because an option holder does
not hold a legally protected interest in the property, the due process concerns
applicable to lienholders do not arise when an option holder is not notified of a
delinquent tax suit. Thus, Target’s reliance on cases involving lienholders is
misplaced. And Target has not cited, nor have we found, any cases holding that due
process rights are implicated when the holder of a purchase option in real property
does not receive notice of a tax foreclosure suit.
Moreover, the trial court found that Target received notice of the tax sale.
Target contends that the notice it received was inadequate, citing Tax Code section
33.94. However, as D&H points out, this provision of the Tax Code is found in
Subchapter E, which applies only to a city or county seizure of real property by tax
warrant, which is an administrative process. See Tex. Tax Code §§ 33.91-.95
6
Additionally, when the taxing authority has actual or constructive notice that non-parties
have title or ownership, a tax foreclosure judgment is not binding on those non-parties. See
Coakley v. Reising, 436 S.W.2d 315, 318 (Tex. 1968) (“A judgment by a taxing agency is not
binding upon a person who is not a party to the suit, when his ownership is evidenced by an
unrecorded document, if the taxing authority has actual or constructive notice of his title or
ownership.”).
28
(“Subchapter E. Seizure of Real Property”). Section 33.94 is inapplicable to the tax
foreclosure suit that occurred in today’s case. Target has not established otherwise
that the notice that it received was inadequate.
2. MRH’s acquisition of the Environmental Parcel was not subject to
Target’s Option.
According to the Tax Code, a tax sale deed:
vests good and perfect title in the purchaser or the purchaser’s assigns
to the interest owned by the defendant in the property subject to the
foreclosure, including the defendant’s right to the use and possession
of the property, subject only to the defendant’s right of redemption, the
terms of a recorded restrictive covenant running with the land that was
recorded before January 1 of the year in which the tax lien on the
property arose, a recorded lien that arose under that restrictive covenant
that was not extinguished in the judgment foreclosing the tax lien, and
each valid easement of record as of the date of the sale that was recorded
before January 1 of the year the tax lien arose.
Tex. Tax Code § 34.01(n). Thus, a purchaser at a tax sale takes title to the property
interest without encumbrances other than those detailed in the above provision, such
as a recorded restrictive covenant. See id. Target does not explain how the Option
fits into any of these categories, but instead claims that the interest D&H received
after the tax foreclosure sale was limited by or subject to Target’s property interest
in the Option. But an option holder does not possess a property interest. See N.
Shore Energy, 501 S.W.3d at 605. And Target did not establish that the Option is a
type of encumbrance or interests identified in section 34.01 as surviving a tax
foreclosure sale.
In Texas, a covenant runs with the land if (1) it touches and concerns the land,
(2) it relates to a thing in existence or specifically binds the parties and their assigns,
(3) it is intended by the original parties to run with the land, and (4) the successor to
the burden has notice. Lennar Homes of Tex. Land & Constr., Ltd. v. Whitely, 625
29
S.W.3d 569, 577-78 (Tex. App.—Houston [14th Dist.] 2021, no pet. h.) (citing
Inwood N. Homeowners’ Ass’n v. Harris, 736 S.W.2d 632, 635 (Tex. 1987)). Only
covenants running with the land bind the heirs and assigns of the covenanting
parties; personal covenants do not. Montfort v. Trek Res., Inc., 198 S.W.3d 344,
355-56 (Tex. App.—Eastland 2006, no pet.). Here, the original option appears to
have been a personal covenant, as it benefitted only the original optionee, Woodland
Heights. However, the parties amended the option to expressly state that it “shall
run with the land” and inure to the benefit of any subsequent owner of the Dominant
Tract. Memorandums of the Original Option and the Amended Option were duly
recorded in the Harris County real property records, providing notice of the burden.
We thus presume that the Option was a covenant running with the land. Cf., e.g.,
MJR Oil & Gas 2001 LLC v. AriesOne, LP, 558 S.W.3d 692, 700-04 (Tex. App.—
Texarkana 2018, no pet.) (right of first refusal in certain oil and gas leases was a
covenant running with the land).
However, as is relevant here, only recorded restrictive covenants survive a tax
foreclosure sale. Tex. Tax Code § 34.01(n). A “restrictive covenant” is a negative
covenant that limits permissible uses of land. Tarr v. Timberwood Park Owners
Ass’n, Inc., 556 S.W.3d 274, 279 (citing Restatement (Third) of Prop.: Servitudes §
1.3(3) (2000)). In contrast, an affirmative covenant requires the covenantor to do
something. Restatement (Third) of Prop.: Servitudes § 1.3(2) (2000). A purchase
option that runs with the land is an affirmative covenant because it requires the
covenantor to do something to invoke the right or rights existing by the option—i.e.,
convey title to the property on certain conditions. See id. cmt. d, illus. 3-4.
By stating that only recorded restrictive covenants survive a tax foreclosure
sale, the legislature may have intended to exclude other types of covenants, such as
an option to purchase running with the land. Cf. United Servs. Auto. Ass’n v. Brite,
30
215 S.W.3d 400, 403 (Tex. 2007) (applying doctrine of expressio unius est exclusio
alterius—the inclusion of a specific limitation excludes all others—to construe
unambiguous jurisdictional statute). Although the doctrine of expressio unius est
exclusio alterius “is simply an aid to determine legislative intent, not an absolute
rule in interpreting statutes,” Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d
887, 895 (Tex. 2000), Target does not suggest any alternative construction of this
statute in its briefing.
The tax foreclosure sale in today’s case conveyed “good and perfect title” to
MRH Properties of the interest owned by Biloxi Bacon, subject only to those
encumbrances specified by section 34.01(n). MRH then conveyed its interest to
D&H. Target has not established that the purchase option in today’s case is a
restrictive covenant or otherwise fits into the categories enumerated in section
34.01(n). Thus, Target has not shown that the trial court erred in concluding that the
purchase option was extinguished by the tax foreclosure sale.
We overrule Target’s second sub-issue.
C. Is Target entitled to judgment on its claims?
In its third sub-issue, Target contends that we should render judgment on all
its claims and remand with instructions. Because we have overruled Target’s sub-
issue relating to the Option, Target is not entitled to specific performance of the
purchase option. However, our resolution of Target’s easement issues in its favor
requires us to consider whether it is entitled to judgment on its claims for breach of
the Easement Agreement and declaratory relief, as well as its request for attorney’s
fees and a permanent injunction.
31
1. Target established that D&H breached the Easement Agreement.
Target pleaded a claim for breach of the Easement Agreement, seeking as
damages the amount it paid to have the fence around the Environmental Easement
removed during the pendency of this suit. To establish a claim for breach of contract,
a plaintiff must prove the following elements: (1) the existence of a valid contract;
(2) the plaintiff performed or tendered performance; (3) the defendant breached the
contract; and (4) the plaintiff suffered damages due to the breach. Arshad v. Express
Bank, FSB, 580 S.W.3d 798, 804 (Tex. App.—Houston [14th Dist.] 2019, no pet.);
Smith v. Smith, 541 S.W.3d 251, 259 (Tex. App.—Houston [14th Dist.] 2017, no
pet.).
The Easement Agreement grants Target the right to use the Environmental
Parcel’s surface for the limited purposes of ingress and egress; parking; landscaping;
and recreational and signage uses. The agreement, as amended, also gives Target
the right to pave the Environmental Parcel. The Easement Agreement expressly
prohibits D&H from using the Environmental Parcel in a manner that interferes with
Target’s Use Easement or Target’s operations on, or use of, the Dominant Tract.
Target’s uncontroverted evidence showed that D&H violated these provisions
by building a fence around the Environmental Parcel in January 2019. D&H built
the fence by driving post holes into the parking lot pavement and placing fence posts
along the Environmental Parcel’s boundary. The fence did not include an opening
or gate. Target established that, once the fence was constructed, Target could no
longer use the Environmental Parcel for any of the Use Easement’s purposes. A
property owner may not interfere with an easement holder’s right to use the servient
estate for the easement’s purposes. Severance, 370 S.W.3d at 721. Target
established that D&H breached the Easement Agreement by interfering with its right
to use the Environmental Parcel for the easement’s purposes.
32
Target likewise established that its out-of-pocket costs to remove the fence
were $1,319.04. D&H did not controvert the amount or the reasonableness of the
costs. Accordingly, Target established conclusively all the elements of its breach of
contract claim, and it is entitled to judgment on that claim.
However, the Easement Agreement does not provide for the award of
attorney’s fees. Thus, Target’s only avenue for recovery of attorney’s fees based on
its breach of contract claim is Civil Practice and Remedies Code section 38.001. But
because D&H is a limited liability company, Target may not recover attorney’s fees
for its breach of contract claim under section 38.001. See, e.g., Vast Constr. LLC v.
CTC Contractors, LLC, 526 S.W.3d 709, 728 (Tex. App.—Houston [14th Dist.]
2017, no pet.); Alta Mesa Holdings, L.P. v. Ives, 488 S.W.3d 438, 452-55 (Tex.
App.—Houston [14th Dist.] 2016, pet. denied).7
2. Target is entitled to declaratory relief.
In its live pleading, Target sought the following declarations:
i. Woodland Heights conveyed to Sawyer Heights the Easement,
which is appurtenant to the Dominant Tract acquired by Sawyer
Heights, when Woodland Heights conveyed the Dominant Tract to
Sawyer Heights on or about October 29, 2004;
ii. Sawyer Heights conveyed to Target the Easement, which is
appurtenant to the substantial portion of the Dominant Tract
acquired by Target, when Sawyer Heights conveyed a substantial
portion of the Dominant Tract to Target on or about October 29,
2004;
iii. Target, as the Dominant Tract owner, owns, holds, and is the grantee
and beneficiary of the Easement under the Easement Agreement;
7
Although the current version of Civil Practice and Remedies Code section 38.001 permits
the recovery of attorney’s fees against a limited liability company for a breach of contract claim,
this version did not take effect until September 1, 2021, after this lawsuit was tried. See Tex. Civ.
Prac. & Rem. Code § 38.001 (eff. Sept. 1, 2021).
33
iv. The default judgment issued in Biloxi Bacon Enterprise Corp. v.
Woodland Heights Development L.P.; in Suit No. 2017-39201; in
the 164th Judicial District Court of Harris County, Texas, is void
and invalid as to Target;
v. The default judgment did not divest Target of the Easement under
the Easement Agreement; and
vi. D&H’s construction of a fence obstructed, encroached upon, and
interfered with Target’s use of the Easement for the purposes set
forth in the Easement Agreement.
Target reiterated its request for declaratory relief at the bench trial:
We’ve requested a declaratory judgment stating that default judgment
was void, limiting D&H’s access per the terms of the easement
agreement and finding that a fence, a building and a parking lease
would all interfere with Target’s use of the easement.
Target contends that it conclusively proved its entitlement to this declaratory
relief. For the reasons explained above, we agree that Target demonstrated its
entitlement to declaratory judgment on requests i, ii, iii, and vi, which relate to its
rights under the Easement Agreement.
We next consider whether Target established entitlement to its requested
declarations iv and v, which relate to the 2017 default judgment Biloxi Bacon
obtained against Woodland Heights purporting to terminate the Easement
Agreement. Target contends on appeal that it is entitled to these declarations
because the Biloxi Bacon default judgment is void for lack of subject matter
jurisdiction and, if it is not void, it is not enforceable against Target because Target
did not participate in or have notice of the lawsuit. We agree that the Biloxi Bacon
default judgment is not enforceable against Target.
In the June 2017 Biloxi Bacon lawsuit, Biloxi Bacon requested a declaration
that Woodland Heights abandoned the Use Easement by forfeiting its right to do
business in Texas and ceasing to exist. But, as noted above, Woodland Heights
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conveyed the Dominant Tract to Sawyer Heights in 2004; Sawyer Heights then
conveyed this tract to Target. Thus, Woodland Heights no longer held any interest
in the Dominant Tract, and it was no longer a party to the Easement Agreement and
did not hold the Use Easement because these covenants ran with the Dominant Tract.
Section 37.006 of the Uniform Declaratory Judgments Act (the “UDJA”)
requires that, when “declaratory relief is sought, all persons who have or claim any
interest that would be affected by the declaration must be made parties.” Tex. Civ.
Prac. & Rem. Code § 37.006(a). Undisputedly, Target was not a party to the Biloxi
Bacon lawsuit. “A declaration does not prejudice the rights of a person not a party
to the proceedings.” Id. Texas courts, including this court, have universally
enforced this provision. See, e.g., Brooks v. Northglen Ass’n, 141 S.W.3d 158, 163
(Tex. 2004) (parties not joined in declaratory judgment suit are not bound by
declarations arising therefrom); In re Estate of Nunu, 542 S.W.3d 67, 77-78 (Tex.
App.—Houston [14th Dist.] 2017, pet. denied) (“McCulloch and Burt are not parties
to this action, so they would not be bound by any such declaration.”); Marhaba
Partners Ltd. P’ship v. Kindron Holdings, LLC, 457 S.W.3d 208, 212 n.5 (Tex.
App.—Houston [14th Dist.] 2015, pet. denied) (“The District is not a party to this
case; therefore, its rights are not prejudiced by the trial court’s declaration in favor
of Kindron.”); In re Corcoran, 401 S.W.3d 136, 139 (Tex. App.—Houston [14th
Dist.] 2011, orig. proceeding?) (holding trial court could issue declaratory judgment
adjudicating homeowners’ rights between certain neighbors without joining all
neighbors governed by same homeowners’ association because trial court’s
judgment would resolve live controversy between neighbors who were parties to suit
and would not affect rights of neighbors who were not parties to suit).
35
Accordingly, Target’s rights under the Easement Agreement were not
prejudiced by the trial court’s declarations in the Biloxi Bacon lawsuit. Target
established its entitlement to declarations iv and v.
The UDJA authorizes the award of attorney’s fees to a party in a declaratory
judgment action if the court determines the award to be equitable and just and the
party presents evidence that the fees are reasonable and necessary. See Tex. Civ.
Prac. & Rem. Code § 37.009. A party need not prevail on all declaratory judgment
claims to be awarded attorney’s fees under the UDJA. See Trevino v. City of
Pearland, 531 S.W.3d 290, 300 (Tex. App.—Houston [14th Dist.] 2017, no pet.)
(“An award of attorney’s fees under section 37.009 is within the discretion of the
trial court and does not depend on a finding that a party substantially prevailed.”).
Because the trial court erroneously denied Target declaratory relief, we remand to
the trial court to consider what, if any, attorney’s fees the trial court determines are
equitable and just. See Lance v. Robinson, 543 S.W.3d 723, 746 (Tex. 2018)
(remanding for reconsideration of attorney’s fees award in light of disposition of
appeal).
3. Target is entitled to injunctive relief.
Target also pleaded a claim for injunctive relief to enforce the Use Easement.
The trial court denied Target’s request for permanent injunctive relief based on its
conclusion that the Use Easement was void and unenforceable. As we have
determined that the Use Easement is not void and that Target holds this easement,
Target is entitled to injunctive relief to enforce its rights under this easement. E.g.,
Still v. Eastman Chem. Co., 170 S.W.3d 851, 855 (Tex. App.—Texarkana 2005, no
pet.) (explaining that a fee owner may not interfere with easement holder’s
“reasonable use and enjoyment of that easement” and that “rights of easement holder
may be protected by injunction”). However, this court may issue writs of injunction
36
only as necessary to enforce our own jurisdiction. See Tex. Gov’t Code § 22.221(a);
In re Laski Plus of Tex., P.A., No. 14-13-00036-CV, 2013 WL 816674, at *1 (Tex.
App.—Houston [14th Dist.] Mar. 5, 2013, orig. proceeding) (mem. op.). Target’s
request for injunctive relief does not fall within these parameters.
We therefore remand to the trial court for entry of a permanent injunction in
Target’s favor. See Vance v. Popkowski, 534 S.W.3d 474, 477, 481 (Tex. App.—
Houston [1st Dist.] 2017, pet. denied) (remanding for entry of injunctive relief);
Peter & Camella Scamardo FLP v. 3D Farms, No. 10-15-00163-CV, 2016 WL
102633, at *5 (Tex. App.—Waco Jan. 7, 2016, pet. denied) (mem. op.) (remanding
to trial court with instructions to enter a mandatory injunction in appellant’s favor).
Conclusion
The Use Easement is not void and unenforceable and Target holds this
easement. D&H breached the Easement Agreement by constructing a fence around
the Environmental Parcel, and we render judgment in Target’s favor against D&H
for that breach and damages of $1,319.04. We additionally render declaratory
judgment in Target’s favor, consistent with this opinion. However, we affirm that
portion of the judgment declaring the Option extinguished. We remand to the trial
court for: (1) entry of a permanent injunction in Target’s favor consistent with this
opinion; and (2) consideration of the issue of attorney’s fees under the UDJA in light
of our disposition of this appeal.
/s/ Kevin Jewell
Justice
Panel consists of Justices Wise, Jewell, and Poissant.
37