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HOUSTON APPEALS IN WELLS FARGO
BANK LITIGATION
SOUTHEAST TEXAS ENVIRONMENTAL, L.L.C., Appellant,
v.
WELLS FARGO BANK, N.A. F/K/A FIRST COMMUNITY BANK, N.A.,
Appellee.
No. 01-10-00076-CV.
Court of Appeals of Texas, First District, Houston.
Opinion issued August 11, 2011.
Panel consists of Justices JENNINGS, BLAND and MASSENGALE.
MEMORANDUM OPINION
MICHAEL MASSENGALE, Justice.
Southeast Texas Environmental, L.L.C. appeals from an order granting summary judgment in favor of Wells Fargo
Bank, N.A. f/k/a First Community Bank, N.A. Southeast Texas Environmental argues that the trial court erred in
granting Wells Fargo's no-evidence motion for summary judgment and in denying its motion for new trial and for
leave to file a supplemental response. Because Southeast Texas Environmental failed to produce evidence
necessary to raise a question of material fact as to damages, we affirm.
Background
In November 2002, Southeast Texas Environmental sued First Community Bank, which was later acquired by
Wells Fargo, for breach of contract and conversion. Southeast Texas Environmental alleged that the bank had
wrongfully taken business records and other property it owned during the execution of a writ of sequestration
against Hub City Environmental. Southeast Texas Environmental claimed that it suffered economic loss because
of its loss of the property held by the bank.
Wells Fargo filed a no-evidence motion for summary judgment, alleging that Southeast Texas Environmental
could not produce evidence to support the element of damages. In response, Southeast Texas Environmental
argued that the deposition testimony of three witnesses was sufficient to raise a question of material fact as to the
issue of damages. It also argued that the evidence established that it would be entitled to a jury instruction on
spoliation of evidence. Southeast Texas Environmental did not, however, file any of the evidence it discussed in
its pleading with the trial court.
The trial court granted summary judgment in favor of Wells Fargo. Southeast Texas Environmental filed a
combined motion for rehearing, new trial, and leave to file a supplemental response. It argued that the trial court
erred in granting Wells Fargo's motion for summary judgment because "as a result of a clerical error or mistake in
the calendaring [of the motion]," the court "[g]ranted the [m]otion without the evidence of damages properly
before it." Southeast Texas Environmental stated that the evidence attached to its supplemental response raised
a question of material fact as to damages and that the court should consider the evidence, grant its motion,
vacate the judgment in favor of Wells Fargo, and deny Wells Fargo's no-evidence motion. The trial court denied
this motion. Southeast Texas Environmental appealed, arguing that the trial court erred in granting Wells Fargo's
no-evidence motion for summary judgment and in denying its combined motion for new trial, rehearing, and leave
to file a supplemental response to the motion for summary judgment.
Analysis [omitted]
Conclusion
Because of our resolution of Southeast Texas Environmental's appellate points, we need not address the cross-
points raised by Wells Fargo. We affirm the judgment of the trial court.
Boss Hoss Cycles of Houston, LLC v. Wells Fargo Bank, NA (pdf) (Tex.App.- Houston [14th Dist.]
Jan. 26, 2010)(Brown) (dealer agreement contract dispute relating to assignment of retail installment contracts,
obligation to repurchase assigned contracts, failure to furnish evidence of perfection of security interest, breach
of agreement not excused)
AFFIRMED IN PART DISMISSED IN PART: Opinion by Justice Brown
14-08-00648-CV Boss Hoss Cycles of Houston, LLC and David Cesshier v. Wells Fargo Bank, N.A.
Appeal from County Civil Court at Law No 1 of Harris County
Trial Court Judge: R. Jack Cagle
BOSS HOSS CYCLES OF HOUSTON, L.L.C. AND DAVID CHESSHIR, Appellants,
v.
WELLS FARGO BANK, N.A., Appellee.
No. 14-08-00648-CV.
Court of Appeals of Texas, Fourteenth District, Houston.
Memorandum Opinion filed January 26, 2010.
Panel consists of Justices ANDERSON, BROWN, and BOYCE.
MEMORANDUM OPINION
JEFFREY V. BROWN, Justice.
In this contract dispute, a jury determined that a motorcycle dealer breached the terms of its agreement with a
bank. In three issues, the motorcycle dealer appeals the jury's verdict in favor of the bank on the grounds that the
bank failed to prove that the dealer breached its agreement with the bank, the dealer perfected the bank's
security interest in the motorcycle at issue, and even if the dealer did not perfect the bank's security interest in
the motorcycle, the dealer was excused from doing so as a matter of law. In addition, the motorcycle dealer asks
that we remand the case to enable it to recover attorneys' fees. Because we conclude that sufficient evidence
supports the jury's findings, we affirm the trial court's judgment.
I. FACTUAL AND PROCEDURAL BACKGROUND
In July 2003, appellant Boss Hoss Cycles of Houston, L.L.C. ("Boss Hoss") and appellee Wells Fargo Bank, N.A.
("Wells Fargo") entered into an agreement (the "Dealer Agreement') in which Boss Hoss, as a motorcycle dealer,
assigned installment contracts from the sale of motorcycles to Wells Fargo. Under the terms of the agreement,
Boss Hoss warranted, among other things, that as of the assignment of the installment contracts to Wells Fargo,
as a result of [Boss Hoss] making application for same, a Certificate of Title, or comparable evidence of the
perfection of [Wells Fargo]'s lien on the property as collateral for the [c]ontract will be issued by the lawful issuing
agency of the state in which the property is sold within 90 days of the date on which the [c]ontract was signed by
the purchaser, on which the "Lienholder," "Legal Owner," or other such terminology reflecting collateral ownership
with regard to the property is identified as [Wells Fargo.]
Boss Hoss further agreed to undertake actions requested by Wells Fargo to evidence and perfect [the Dealer
Agreement], [Wells Fargo]'s ownership interest in a [c]ontract and its proceeds, [Wells Fargo]'s ownership or
security interest in the related property financed and any [related rights.]
Finally, Boss Hoss agreed to repurchase any contract or any of Wells Fargo's ownership or security interest in the
financed property if Wells Fargo determined that Boss Hoss "breached any warranty, covenant or other duty to
[Wells Fargo] arising" under the Dealer Agreement. The repurchase price would be the amount of the unpaid
installment contract, including any premiums or other amounts due under the installment contract. Boss Hoss's
president and owner, David Chesshir, executed the agreement.
In August 2006, Boss Hoss sold a motorcycle to Ronald Elic at a motorcycle rally in Sturgis, South Dakota. Elic
executed a retail-installment contract for the purchase of the motorcycle at the time of the sale. Under the
contract, Elic agreed to make 84 monthly payments, beginning September 9, 2006, and ending August 9, 2013.
Wells Fargo approved Elic for financing and the contract was assigned to the bank. On August 10, 2006,
Chesshir wrote a letter on behalf of Boss Hoss (the "Guarantee Letter") to Wells Fargo, stating:
This letter will service [sic] as a guarantee of title on RONALD P. ELIC that Boss Hoss Cycles of Houston will
forward to WELLS FARGO BANK, N.A. all title papers on 2006 BOSS HOSS 502 BIKE, VIN NO:
1B96BC446D285250 upon receipt of MSO[1] and check in the amount of $ 35,300.00.
If Wells Fargo has not received the perfected title showing Wells Fargo as the lien holder within 90 days, Wells
Fargo may require the Dealership, (Boss Hoss Cycles of Houston), to repurchase the loan.
Wells Fargo paid Boss Hoss $35,300.00 for the assignment of the Elic contract. In September, Boss Hoss
endorsed the reverse-side of the MSO, notating Wells Fargo as a lienholder, and sent it to Elic. Elic did not apply
for a title on the motorcycle, and Wells Fargo did not receive a perfected title showing it as a lienholder within 90
days of the date of the Guarantee Letter.
Elic defaulted on the installment contract, and in May 2007, Wells Fargo notified Boss Hoss in writing that Wells
Fargo had never obtained a "perfected lien interest" on the loan. Wells Fargo stated that under the terms of the
Dealer Agreement and the Guarantee Letter, Boss Hoss was required to repurchase the loan and that the payoff
amount of the Elic contract was $32,705.54. Boss Hoss did not provide the funds to Wells Fargo, and Wells Fargo
filed suit against Boss Hoss and Chesshir for breach of contract and conversion.[2]
Before trial, the trial court granted partial summary judgment, concluding that (a) Missouri law governed the
perfection of Wells Fargo's security interest in the motorcycle purchased by Elic, (b) a security interest under
Missouri law can only be perfected by delivery of a notice of lien to the Missouri director of revenue, and (c) Boss
Hoss did not perfect Wells Fargo's security interest in the motorcycle. The case proceeded to a jury trial.
At trial, Chesshir testified that, pursuant to the Dealer Agreement, Boss Hoss agreed to take "such action as
necessary" or as Wells Fargo requested to perfect its security interest. He also agreed that Boss Hoss warranted
it would repurchase any installment contract if Boss Hoss breached any warranty or duty arising out of the Dealer
Agreement. He admitted that he sent the Guarantee Letter to Wells Fargo, and that Boss Hoss received the
$35,300 from Wells Fargo. In addition, the following colloquy occurred between Chesshir and the attorney
representing Wells Fargo:
Q.: You promised Wells Fargo Bank, as the owner of Boss Hoss, that if they paid you $35,300, you would
guarantee that Wells Fargo would get a perfected title; isn't that correct?
A.: I don't know how to answer that.
Q.: You need to answer yes or no, Mr. Chesshir.
A.: Yes.
Chesshir also explained that Wells Fargo approved the loan to Elic. He testified that "title work" was provided to
Wells Fargo in the form of a copy of the front side of the MSO. Accoding to Chesshir, an MSO is a form of a title,
but not a certificate of title. He stated that other out-of-state sales had been handled in a similar manner with
Wells Fargo without any problems. Chesshir explained that he took several actions to protect Wells Fargo's
security interest: (1) he filled out the back side of the MSO with Wells Fargo listed as the lienholder and sent it to
Elic; (2) he called Elic numerous times when Wells Fargo notified him that Elic had not titled the vehicle; (3) he
provided Wells Fargo with Elic's contact information and insurance information when Wells Fargo notified him that
Elic had missed payments; (4) he suggested that Wells Fargo inform Elic's motorcycle insurance provider that Elic
had failed to title the motorcycle; and (5) he offered to pick up the motorcycle if Wells Fargo decided to repossess
it. Chesshir further admitted that Boss Hoss provided no evidence of a perfected lien to Wells Fargo for this
particular transaction and that, without an MSO, a party cannot get a certificate of title. According to Chesshir,
Wells Fargo decided not to repossess the motorcycle, and shortly after sending him a demand letter regarding
repurchasing the Elic contract, Wells Fargo notified him that it would no longer be financing motorcycles. Chesshir
also stated that he believed the Dealer Agreement only applied to transactions occurring in Texas, and that the
only reason Boss Hoss had not gotten the motorcycle titled in Missouri for Wells Fargo was that it would be illegal
for it to do so.
Mary Walker, a representative of Wells Fargo, testified that the Elic loan was in default. When questioned about
repossessing the motorcycle, she stated that Wells Fargo could not repossess the motorcycle without a perfected
title. She admitted that she was unaware that, under Missouri law, Wells Fargo could have notified the Missouri
director of revenue of its lien on the motorcycle to perfect its security interest. Finally, both attorneys for Wells
Fargo and Boss Hoss testified regarding reasonable attorneys' fees for handling this dispute.
The trial court charged the jury, and the jury unanimously determined that Boss Hoss failed to comply with its
"Agreement" with Wells Fargo, and that its failure to comply was not excused. The jury found (a) $32,705.54 in
damages for Boss Hoss's failure to comply with the agreement and (b) $15,522.94 to be reasonable attorneys'
fees for prosecution of Wells Fargo's claims through trial.[3] Boss Hoss and Chesshir filed a motion for judgment
notwithstanding the verdict, contending that the evidence conclusively established that it perfected Wells Fargo's
security interest and, if it did not, its failure to do so was excused as a matter of law. After denying Boss Hoss's
and Chesshir's motion for judgment notwithstanding the verdict, the trial court entered judgment against them.
Boss Hoss and Chesshir filed a motion for new trial, which was overruled by operation of law, and this appeal
timely ensued.
II. ISSUES PRESENTED
In its first issue, Boss Hoss asserts that Wells Fargo did not prove that Boss Hoss breached the Dealer
Agreement. Boss Hoss contends that it perfected Wells Fargo's security interest in its second issue. In issue
three, Boss Hoss argues that, if it did not perfect Wells Fargo's security interest, its failure to do so was excused
as a matter of law. Finally, Boss Hoss asks that the case be remanded so that it can recover attorneys' fees in
issue four.
III. ANALYSIS
A. Dismissal of Chesshir's Appeal
The pleadings, judgment, and notice of appeal filed in the trial court all reference both Boss Hoss and Chesshir
as parties. But the appellate brief filed by Boss Hoss in this court lists only Boss Hoss as a party; Chesshir is not
included as a party. On September 9, 2009, this court notified the parties that we would consider dismissal of
Chesshir's appeal for want of prosecution if no party filed a response on or before September 21, 2009, showing
meritorious grounds for continuing the appeal. This letter additionally advised Chesshir that he could join Boss
Hoss's brief. No response was filed to this letter. Thus, we order Chesshir's appeal dismissed for want of
prosecution.
B. Perfection of Security Interest
Boss Hoss's second and third issues specifically concern whether it perfected Wells Fargo's security interest in
the motorcycle. These issues appear to be challenges to the trial court's pre-trial partial summary judgment that
Missouri law applies to this dispute and that Boss Hoss failed to perfect Wells Fargo's security interest in the
motorcycle under Missouri law. But Boss Hoss provides no argument or authority regarding a choice-of-law issue.
Thus, to the extent that these challenges relate to the trial court's choice-of-law determinations, they are
inadequately briefed and are waived. See Tex. R. App. P. 38.1(i) ("The brief must contain a clear and concise
argument for the contentions made, with appropriate citations to authorities and to the record."); see also Priddy
v. Rawson, 282 S.W.3d 588, 595 (Tex. App.-Houston [14th Dist.] 2009, pet. denied) (stating that it is not the duty
of an appellate court to perform an independent review of the summary-judgment record for evidence supporting
an appellant's position).
Further, the questions presented to the jury did not concern whether Boss Hoss perfected Wells Fargo's security
interest in the motorcycle subject to the retail-installment contract. Instead, the questions the jury was asked
concerned whether Boss Hoss failed to comply with its agreement with Wells Fargo and whether this failure, if any,
was excused. Neither the Dealer Agreement nor the Guarantee Letter required Boss Hoss to perfect Wells
Fargo's security interest; instead, both required Boss Hoss to provide evidence to Wells Fargo that the security
interest was perfected. Thus, rather than considering whether Boss Hoss "perfected" Wells Fargo's security
interest in the motorcycle, we confine our review to the issues actually before the jury: whether Boss Hoss
breached its agreement with Wells Fargo, and if so, whether the breach was excused.
C. Failure to Comply with the Agreement
Under its first issue, Boss Hoss argues (1) Wells Fargo did not plead that Boss Hoss breached the Dealer
Agreement and instead alleged that Chesshir breached the agreement; (2) the only breach Wells Fargo alleges is
that Boss Hoss violated the laws of the State of Texas, but the trial court concluded that Missouri law governed
this dispute, hence the duties alleged by Wells Fargo are inapplicable; (3) delivery of the MSO to a buyer does
not constitute a breach of the Dealer Agreement because Wells Fargo was not deprived of a means of perfecting
a security interest in the motorcycle; and (4) there "is no pleading or evidence" that Boss Hoss breached the
Dealer Agreement.
As to the first two of these arguments, Wells Fargo pleaded that Boss Hoss breached the Dealer Agreement by
failing to provide it with evidence of lien perfection within 90 days as promised in the agreement. Wells Fargo
further alleged that Boss Hoss breached the Guarantee Letter. Thus, Boss Hoss's first two arguments are without
merit. Turning to the third argument, it is immaterial whether the delivery of the MSO to Elic constituted a breach
of the Dealer Agreement; rather, the definitive issue is whether sufficient evidence supports the jury's verdict that
Boss Hoss breached an agreement with Wells Fargo. We thus turn to Boss Hoss's fourth argument under this
issue: whether there is proof that Boss Hoss breached the Dealer Agreement.
First, the question presented to the jury was not limited to whether Boss Hoss breached the Dealer Agreement.
Rather, the question presented to the jury was this: "Did Boss Hoss Cycles of Houston, L.L.C. fail to comply with
its Agreement with Wells Fargo Bank, N.A.?" The term "Agreement" was not defined in the jury charge;[4] thus, it
could have applied to either the Dealer Agreement or the Guarantee Letter. We therefore consider whether there
is legally sufficient evidence to support the jury's finding that Boss Hoss breached either the Dealer Agreement or
the Guarantee Letter.
To determine whether the evidence is legally sufficient to support the judgment, we review the entire record,
crediting favorable evidence if reasonable jurors could and disregarding contrary evidence unless reasonable
jurors could not. See City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). We assume that jurors decided
questions of credibility or conflicting evidence in favor of the verdict if they reasonably could do so. Id. at 819,
820. We do not substitute our judgment for that of the trier-of-fact if the evidence falls within this zone of
reasonable disagreement. Id. at 822. If the evidence would enable reasonable and fair-minded people to differ in
their conclusions, then it is legally sufficient to support the verdict.Id.
As detailed above, under the unambiguous terms of the Dealer Agreement, Boss Hoss was required to provide
evidence to Wells Fargo of a perfected security interest in the property as collateral for any assigned contracts. If
Boss Hoss breached the duties imposed by the Dealer Agreement, Wells Fargo could require it to repurchase the
contract. Further, under the similarly unambiguous terms of the Guarantee Letter, Wells Fargo could require Boss
Hoss to repurchase Elic's loan contract if Wells Fargo did not receive a "perfected title showing Wells Fargo as
the lien holder within 90 days" of the date of the letter. It is undisputed that Wells Fargo did not receive a
perfected title showing it as the lien holder for the motorcycle that was the subject of the Elic contract within either
90 days of the date of the contract or 90 days of the date of the Guarantee Letter.[5] Indeed, both Chesshir and
Walker testified that perfection of Wells Fargo's security interest in the motorcycle did not occur. We thus
conclude that there is legally sufficient evidence to support the jury's conclusion that Boss Hoss did not comply
with either the Dealer Agreement or the Guarantee Letter.
D. "Excuse" for Failure to Comply with Agreement
Next, in an abundance of caution, we consider whether there is legally sufficient evidence to support the jury's
negative answer to the question, "Was [Boss Hoss's] failure to comply [with its agreement with Wells Fargo]
excused?" Boss Hoss argues that it would have been impossible for it to perfect Wells Fargo's security interest
under Missouri law because only a lienholder or a licensed agent may create a lien on a motor vehicle under
Missouri law. It contends that, because Chesshir testified it would have been illegal for Boss Hoss to attempt to file
a notice of lien to perfect Wells Fargo's security interest in Missouri, any requirement under the Dealer Agreement
that Boss Hoss do so must be excused. See, e.g., Centex Corp. v. Dalton, 840 S.W.2d 952, 954 (Tex. 1992)
(discussing the defense of supervening impossibility due to a change in law).[6]
This argument is based on the faulty premise that Boss Hoss was required, under the Dealer Agreement or the
Guarantee Letter, to perfect Wells Fargo's security interest itself. As discussed above, however, neither of these
agreements required Boss Hoss to perfect the security interest. Instead, both agreements required Boss Hoss to
provide evidence to Wells Fargo that its security interest in the motorcycle was perfected. It is undisputed that
Boss Hoss failed to provide any evidence of a perfected security interest in the motorcycle to Wells Fargo.
Further, instead of providing the MSO to Wells Fargo so that it could perfect its own security interest, Boss Hoss
sent the MSO to Elic, who failed to title the motorcycle. We thus conclude that there is legally sufficient evidence
to support the jury's finding that Boss Hoss's failure to comply with its agreement(s) with Wells Fargo was not
excused.[7]
IV. CONCLUSION
First, Chesshir's appeal is dismissed for want of prosecution. Second, we conclude that legally sufficient evidence
supports the jury's finding that Boss Hoss failed to comply with its agreement(s) with Wells Fargo and that its
failure to do so was not excused. We therefore overrule its first issue. Additionally, Boss Hoss has waived its
second and third issues by failing to adequately brief them, and they are overruled. Finally, because Boss Hoss
has not established that the jury's verdict was erroneous, it is not entitled to attorneys' fees.[8] We therefore
overrule Boss Hoss's fourth issue and affirm the trial court's judgment.
[1] MSO stands for "Manufacturer's Statement of Origin." According to Chesshir, such a form is the first document in a chain of title.
The MSO comes from the factory to the dealership and then later is transferred into a certificate of title.
[2] The jury charge contained no questions regarding conversion.
[3] The jury also found $2,500 to be reasonable attorneys' fees for prevailing on an appeal to an intermediate court, $1,500 for
responding to a petition for review in the Supreme Court, and $1,500 for prevailing in the Supreme Court if a petition for review were
granted.
[4] Boss Hoss neither objected to the jury charge nor complains of charge error on appeal.
[5] It is also undisputed that the amount owed on the loan at the time Elic defaulted was $32,705.54; the Dealer Agreement explicitly
provided that the repurchase price would be the amount of the unpaid installment contract.
[6] Centex Corp. is the only case cited in the entirety of Boss Hoss's appellate brief.
[7] At trial, as detailed above, Chesshir indicated that Boss Hoss previously had handled out-of-state sales in a similar manner as
this one was handled without any problems or complaints from Wells Fargo. He also explained the actions he took to protect Wells
Fargo's security interest in the bike. He testified that "title work" was provided to Wells Fargo in the form of a copy of the MSO. Finally,
he stated that he believed the Dealer Agreement only applied to transactions occurring in Texas. But none of these arguments have
been made on appeal. Thus, if any of these efforts would have "excused" Boss Hoss's failure to comply with its agreement(s) with
Wells Fargo, they have been waived on appeal.
[8] Under the terms of the contract, only the prevailing party in any legal proceedings is entitled to recover attorneys' fees and costs.
Further, the Texas Civil Practice and Remedies Code provides for the award of attorneys' fees only to a prevailing party in a breach
of contract case. See TEX. CIV. PRAC. & REM. CODE ANN. § 38.001(8) (Vernon 2008).
WELLS FARGO BANK, N.A. AS TRUSTEE FOR THE REGISTERED HOLDERS OF CREDIT SUISSE FIRST
BOSTON MORTGAGE SECURITIES CORP., COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2005-C6, ACTING BY AND THROUGH TORCHLIGHT LOAN SERVICES, LLC AS SPECIAL SERVICER,
Appellant,
v.
JRK-VILLAGES AT MEYERLAND, LLC, Appellee.
No. 01-10-01076-CV.
Court of Appeals of Texas, First District, Houston.
Opinion issued January 6, 2011.
Panel consists of Justices JENNINGS, HIGLEY and BROWN.
MEMORANDUM OPINION
HARVEY BROWN, Justice.
Wells Fargo Bank, N.A. appeals the trial court's November 19, 2010 amended order appointing a receiver. JRK-
Villages at Meyerland, LLC moved to dismiss, asserting this Court lacks jurisdiction over this appeal. We dismiss
for want of jurisdiction.
Background
Wells Fargo applied for a receiver alleging that JRK-Villages had defaulted in making payments due under a
promissory note. The note is secured by a deed of trust for the property at issue in this appeal, as well as a rent
assignment. Wells Fargo sought a receiver on the grounds that the property was "in danger of being lost,
removed, or materially injured." The trial court appointed a receiver on October 29, 2010. In the order appointing
the receiver, the trial court ordered that a nonjudicial foreclosure should occur in December 2010.
Wells Fargo, dissatisfied with the December 2010 condition, moved to amend the order appointing a receiver.
Specifically, Wells Fargo asked for the trial court to delete or, alternatively, amend the portion of the order
requiring a sale in December, asserting that it was insufficient time to conduct a proper sale and realize the best
price on the property. The trial court granted the motion and issued an amended order. The only change
pertinent to this appeal is the change in the deadline from December 2010 to February 1, 2011. Within 20 days of
the amended order, Wells Fargo filed its notice of appeal.
Jurisdiction
"Appellate courts have jurisdiction to consider immediate appeals of interlocutory orders only if a statute expressly
provides appellate jurisdiction."
Benefield v. State, 266 S.W.3d 25, 29 (Tex. App.-Houston [1st Dist.] 2008, no pet.). Section 51.014(a)(1)
authorizes an interlocutory appeal from an order that "appoints a receiver or trustee." TEX. CIV. PRAC. & REM.
CODE ANN. § 51.014(a)(1) (Vernon 2008). Texas courts strictly construe statutes authorizing interlocutory
appeals. Benefield, 266 S.W.3d at 30.
Wells Fargo is not appealing an order appointing a receiver. Wells Fargo asked for the appointment of a receiver,
but appeals a condition the trial court imposed upon the receiver. Section 51.014(a) does not address orders
modifying or amending the terms of a receiver's appointment. Construing section 51.014(a) strictly, as we must,
we conclude we lack jurisdiction over this appeal. See TEX. CIV. PRAC. & REM. CODE ANN. § 51.014(a)(1).
Furthermore, this Court has held that section 51.014(a)(1) requires a party to appeal within 20 days of the
original order appointing a receiver. Sclafani v. Sclafani, 870 S.W.2d 608, 611 (Tex. App.-Houston [1st Dist.]
1993, writ denied). Id. More than 20 days passed from the order appointing a receiver before Wells Fargo
appealed the amended order. Thus, the notice of appeal was untimely. See TEX. R. APP. P. 26.1(b) (stating
notice of appeal in accelerated case must be filed within 20 days after judgment or order); id. 28.1(a) (stating
appeals from interlocutory orders, when allowed, are accelerated).
Conclusion
We grant JRK-Villages's motion and dismiss this cause for want of jurisdiction.
RUSSELL SCOTT CLARK, et al, Appellants,
v.
WELLS FARGO BANK, N.A., SUCCESSOR-IN-INTEREST TO FIRST COMMUNITY BANK, N.A.,
Appellee.
No. 01-08-00887-CV.
Court of Appeals of Texas, First District, Houston.
Opinion issued June 10, 2010.
Panel consists of Justices KEYES, ALCALA and HANKS.
MEMORANDUM OPINION
GEORGE C. HANKS, JR., Justice.
In this dispute over survivorship rights to several certificates of deposit ("CDs"), appellants, Russell Scott Clark,
Jerry Ann Clark, Levi Clifford Clark, Cayleigh Rene, a minor child by and through Russell Scott Clark, Chance
Parker, a minor child by and through Russell Scott Clark, Whitney Blair Clark, a minor child by and through
Russell Scott Clark, Brett Allen Metcalf, Robin Renee Metcalf Saxon, Brandon Dean Metcalf, a minor child by and
through Robin Renee Metcalf Saxon, Shanon Kay Small, and Jordan Dane Small, a minor child by and through
Shanon Kay Small (collectively "Claimants"), contend that the trial court erred in granting summary judgments in
favor of appellees, Wells Fargo Bank, N.A., successor-in-interest to First Community Bank, N.A., ("Wells Fargo").
In this instant appeal, Claimants allege that Wells Fargo tortiously interfered with their inheritance rights and was
negligent with respect to the CDs and that the trial court therefore erred by granting summary judgment in Wells
Fargo's favor.
We affirm.
Background
In the early 1990s, Parker Williams purchased six CDs from First Community Bank Houston (the "Original CDs").
[1] These CDs, which totaled $1,253,907.50, carried the name of Williams and Claimants and were each marked
as a "Multiple-Party Account with Right of Survivorship." The Original CDs provided:
Multi-Party Account with Right of Survivorship — The parties to the account own the account in proportion to the
parties' net contributions to the account. We may pay any sum in the account to a party at any time. On the death
of a party, the party's ownership of the account passes to the surviving parties.
Withdrawals — Unless otherwise clearly indicated on the account records, any one of you who signs this form
including authorized signors may withdraw or transfer all or any part of the account balance at any time on forms
approved by us.
Williams was the only one who signed the account agreements, and Claimants were unaware that the CDs existed.
In July of 2004, Williams met with a Wells Fargo employee in Houston and was told that the CDs were not fully
covered by Federal Deposit Insurance Corporation ("FDIC") insurance. Williams was advised that the First
Community Bank San Antonio, N.A.[2] could provide her with the requisite excess deposit insurance coverage.
She purchased six new fully-insured CDs at the San Antonio location (the "New CDs"). These New CDs were set
up in Williams's name only, and she initialed the "Single-Party Account Without `P.O.D.' Designation" on each of
the account agreements. The new accounts provided:
Single-Party Account Without P.O.D. Designation — The party to the account owns the account. On the death of
the party, ownership of the account passes as a part of the party's estate under the party's will or by intestacy.
One month later, on August 25, 2004, Williams died intestate. Claimants are not Williams's heirs or legatees
under the laws of intestate distribution.
On March 23, 2005, upon request from Williams's administrator, Wells Fargo wired the funds from the New CDs to
Williams' estate ("the Estate"). One month later, on April 29, 2005, Claimants filed a presentment of claim in the
probate court demanding payment of the CDs. The Estate denied the claim, and Wells Fargo filed a lawsuit,
seeking declaratory judgment.
Wells Fargo's petition for declaratory judgment sought (1) a determination of the construction and validity of the
CDs; (2) a declaration of rights, status, or other legal relations between Wells Fargo, Williams's estate, and
Claimants; (3) a declaration of rights, if any, of Claimants to the CDs at the time of Williams's death; and (4) a
determination of any other questions as to any of Claimants' ownership of the CDs other than as Williams's heirs.
Claimants filed an original third-party petition that sought resolution to the same issues presented by Wells Fargo.
Three months later, Wells Fargo filed a traditional motion for interlocutory summary judgment asking the trial court
to issue a declaration regarding (1) the validity and enforceability of the account documents underlying the
Original CDs; (2) whether Williams was a person with the right to withdraw or transfer the funds represented by
the Original CDs; (3) whether Williams had the right to withdraw or transfer at any time all or any part of the funds
represented by the Original CDs; and (4) Wells Fargo's discharge from claims for amounts paid by or on behalf of
Wells Fargo to Williams as proceeds from the Original CDs. The Estate adopted Wells Fargo's traditional motion
for summary judgment and also filed a no-evidence summary judgment.
Claimants subsequently amended their petition to assert, for the first time, affirmative tort claims against the
Estate and Wells Fargo. Specifically, Claimants allege that it was "unnecessary for Parker Williams to modify the
multi-party [CDs] and that Parker Williams intended for Claimants to receive the funds contained within the [CDs]
that were transmitted to the [Estate]." Claimants alleged, in the alternative, that, if the court determined that the
Estate is the rightful owner of the New CDs, "Wells Fargo tortiously interfered with Claimants' inheritance rights."
Claimants further alleged that "Wells Fargo was negligent with respect to banking, investment, and FDIC
coverage advice provided to Parker Williams."
On August 3, 2006, the trial court ordered as follows:
1. Judgment that the Account documents underlying the Original CDs are valid and enforceable against Claimants.
2. Judgment that PARKER WILLIAMS was a person with the right to withdraw or transfer the funds represented by
the Original CDs.
3. Judgment that PARKER WILLIAMS had the right to withdraw or transfer at any time all or any part of the funds
represented by the Original CDs.
4. Judgment that WELLS FARGO is discharged from claims for amounts paid by or on behalf of Plaintiff to
PARKER WILLIAMS as proceeds from the Original CDs.
5. An award of attorney's fees in the amount of $18,012.00.
6. Judgment for its costs of suit.
Wells Fargo's case was severed from the remaining action. The trial court granted the Estate's traditional and no-
evidence motions for summary judgment.
Claimants filed an appeal to this Court. See Clark v. Wells Fargo Bank, Nos. 01-06-896-CV and 01-07-00165-CV,
2008 WL 866499 (Tex. App.-Houston [1st Dist.] 2008, no pet.) ("Clark I "). In Clark I, we dismissed Claimants'
appeal of the summary judgment in Wells Fargo's favor for want of jurisdiction, holding that the court's judgment
was not final because Wells Fargo's motion for summary judgment had not addressed the tort claims that
Claimants added to their petition after the motion was filed. We affirmed the summary judgment in favor of the
Estate.
On remand, Wells Fargo filed traditional and no-evidence motions for summary judgment that specifically
addressed Claimants' new tort claims. In its motions for summary judgment filed after remand, Wells Fargo first
argued that the tort claims asserted in Claimants' First Amended Petition were resolved, in part, by the trial court's
interlocutory judgment on its first round of summary judgment motions, and that, consequently, "Wells Fargo is
absolved from liability for any and all claims related to the closing and/or payment of the Original CDs. Any
purported tort claims that Claimants assert against Wells Fargo would need to rely exclusively on tortious actions
taken after (1) the Original CDs were closed and (2) Claimants' contingency interests in the Original CDs
extinguished." For their part, Claimants seem to agree, conceding "Claimants' live pleading relates to the new
CDs and tortious actions taken by Wells Fargo after the original CDs were closed."
Wells Fargo moved for traditional summary judgment on Claimants' negligence and tortious interference with
inheritance on the following grounds: (1) Texas Probate Code section 448 discharges Wells Fargo from liability
for payment or transfer of the Original CDs; (2) Claimants lacked an expectancy interest in the New CDs; and (3)
Claimants were strangers to the New CDs and Wells Fargo did not owe any duty to Claimants relating to the New
CDs.
Wells Fargo's no-evidence motion for summary judgment asserted that Claimants' tortious interference claim
should be dismissed because Claimants failed to present any evidence of (a) an expectancy interest in the New
CDs, (b) that Wells Fargo intentionally interfered with Claimants' expectancy interest, (c) that such interference
constituted conduct tortious in itself, and (d) that there was a reasonable certainty that the funds at issue would
have been received by Claimants but for Wells Fargo's purported tortious interference. Similarly, Wells Fargo
alleged that Claimants failed to present any evidence on their negligence claims regarding (a) any duty Wells
Fargo owed Claimants or (b) any breach of any such duty owed to Claimants.
The trial court granted Wells Fargo's traditional and no-evidence motions for summary judgment, and this appeal
followed.
Claimants now argue that the trial court erred by granting Wells Fargo's traditional and no-evidence motions for
summary judgment. Essentially, Claimants contend that they had an interest in the New CDs and that Wells Fargo
tortiously interfered with that interest.
Analysis
A. Standard of Review [summary judgment standard]
B. Texas Probate Code Section 448
On appeal, Claimants argue that Texas Probate Code section 448 does not bar their tort claims relating to the
New CDs, which were issued after Parker Williams closed the original multi-party CDs at Wells Fargo. Specifically,
Claimants argue that Texas Probate Code section 448 does not apply to the New CDs because the New CDs are
single-party accounts and section 448, by its plain language, applies only to multiple-party CDs such as the
original CDs. In addition, Claimants argue that section 439A(a) of the Probate Code limits the protections of
section 448 and prevents it from applying to the New CDs in this case.
Section 444 of the Probate Code allows for the creation of multiple-party accounts at financial institutions and
states, "A multiple-party account may be paid, on request, to any one or more of the parties." Tex. Prob. Code
Ann. § 444 (Vernon 2003). Section 448 provides, in part,
Payment made as provided by Section 444 . . . of this code discharges the financial institution from all claims for
amounts so paid whether or not the payment is consistent with the beneficial ownership of the account as
between parties, P.O.D. payees, or beneficiaries, or their successors.
Id. § 448. Claimants also point to section 439A(a), which at the time stated that the "the provisions of this part of
Chapter XI of this code govern an account . . . other than a single-party account without a P.O.D. designation." Id.
§ 439A(a) (amended 2009).
Claimants do, however, concede that "[u]nder Section 448, Wells Fargo was discharged from claims for the
`payment' it made to Parker as a joint owner when it closed the original CDs." This concession is in accordance
with both section 448 and with case law. See, e.g., Bandy v. First State Bank, 835 S.W.2d 609, 615-16 (Tex.
1992) (holding bank not liable for paying funds to one of named holders of a joint account, even after executor of
other named holder's estate demanded payment); MBank Corpus Christi, N.A. v. Shiner, 840 S.W.2d 724, 727
(Tex. App.-Corpus Christi 1992, no writ) ("Thus, between competing interests in a joint account, the bank is fully
discharged from liability when it pays the other party on the account, unless one of the parties gives written notice
to the bank that no payment should be made.").
Thus, to the extent that any of Claimants' causes of action relate to the Original CDs or to actions taken before
the Original CDs were closed, those claims are barred by section 448. Our analysis of Claimants' tort claims will
therefore focus on whether the trial court erred by granting summary judgment on the causes of action Claimants
asserted against Wells Fargo based on any acts or omissions by Wells Fargo that occurred after the Original CDs
were closed—i.e., whether Wells Fargo tortiously interfered with or was negligent with respect to any interests
Claimants may have had in the New CDs.
C. Tortious Interference with Inheritance
This Court recognized the potential cause of action for tortious interference with inheritance in King v. Acker, 725
S.W.2d 750 (Tex. App.-Houston [1st Dist.] 1987, no writ). Citing the Restatement (Second) of Torts and caselaw
from other jurisdictions, King stated that "[o]ne who by fraud, duress or other tortious means intentionally prevents
another from receiving from a third person an inheritance or gift that he would otherwise have received is subject
to liability to the other for loss of the inheritance or gift." 725 S.W.2d at 754. Comment c to Restatement section
774B explains that "the liability stated in this Section is limited to cases in which the actor has interfered with the
inheritance or gift by means that are independently tortious in character." Restatement (Second) of Torts § 774B
cmt. c (1979). Comment d further requires "proof amounting to a reasonable degree of certainty that the bequest
or devise would have been in effect at the time of the death of the testator or that the gift would have been made
inter vivos if there had been no such interference." Id. at cmt. d.
Thus, in order to sustain a cause of action for tortious interference with inheritance, a plaintiff must present some
evidence that he in fact stood to inherit or receive the property at issue. Claimants did not provide any evidence
in response to Wells Fargo's motion for no-evidence summary judgment that they actually had an interest in the
New CDs such that they could sustain a cause of action for tortious interference. See, e.g., In re Estate of
Kuykendall, 206 S.W.3d 766, 771 (Tex. App.-Texarkana 2006, no pet.) (upholding instructed verdict on claim of
tortious interference with inheritance because "[p]laintiffs offered nothing to establish there was anything to which
they were entitled that Harold prevented them from receiving.").
Further, Claimants have produced no evidence of any intentional tortious conduct by Wells Fargo—instead, much
of the evidence upon which they rely was excluded by the trial court. See, e.g., Little v. Needham, 236 S.W.3d
328, 331 (Tex. App.-Houston [1st Dist.] 2007, no pet.) (when trial court sustained objection to summary judgment
evidence and briefing on appeal relied on evidence but did not attack merits of trial court's ruling, appellate court
may not consider the evidence) (citing Inglish v. Prudential Ins. Co. of America, 928 S.W.2d 702, 706 (Tex. App.-
Houston [1st Dist.] 1996, writ denied)).
D. Negligence
Claimants also argue that Wells Fargo was negligent when it failed to take sufficient steps to protect Claimants'
inheritance rights when opening the New CDs in San Antonio without a right of survivorship. In addition, Claimants
argue that Wells Fargo owed them a duty because it knew of their interests in the Original CDs and knew that
they had rights of survivorship on those prior CDs. Claimants argue that, when harm is foreseeable, a duty exists.
[elements of negligence]
Wells Fargo filed a no-evidence summary judgment motion as to each of the three elements. Further, Wells
Fargo's traditional motion for summary judgment argued that Wells Fargo did not have any duty to Claimants and
that Claimants' allegations were an "attempt to piggyback on purported actions directed toward Williams because
Claimants had no dealings whatsoever with Wells Fargo." Alternatively, Wells Fargo argued that any duty it may
have had to Claimants would have been grounded in the account documents governing the original CDs and
would thus be based in contract.
We agree with Wells Fargo's first contention and thus need not reach the others. Claimants' pleadings reveal that
all of the actions for which Claimants seek to recover on their negligence cause of action were directed at Parker
Williams and related to the duties Wells Fargo owed to Williams. With regard to Wells Fargo's actions relating to
the New CDs, Claimants' First Amended Petition alleged that
Wells Fargo was negligent with respect to banking, investment, and FDIC coverage advice provided to Parker
Williams. Wells Fargo owed a duty (both common law and as a fiduciary) to Claimants as co-owners of the multi-
party certificates of deposit to provide sound and accurate advice regarding applicable insurance coverage on
the certificates of deposit. Wells Fargo also had a duty to inquire as to the type of account Parker Williams
desired after it was represented by Wells Fargo that the certificates of deposit were not fully insured. Because
Wells Fargo failed to provide and/or obtain adequate and correct information, Parker Williams was forced to
modify her certificates of deposit which consequently led to the loss of inheritance on behalf of the Claimants.
In addition, none of these allegations relate to actions taken after the closing of the original CDs. There is no
evidence that Wells Fargo owed any legal duty to Claimants.
Claimants point us to A.G. Edwards & Sons v. Beyer, 235 S.W.3d 704 (Tex. 2007), which they argue stands for
the proposition that banks have independent duties to persons with potential inheritance rights in investment
vehicles. The facts of Beyer, however, are clearly distinguishable from this case. In Beyer, a father and daughter
sought to open a joint account with a right of survivorship and they signed and delivered documents to that effect,
thus creating a contract between themselves and the financial institution. The financial institution lost the
documents prior to actually opening the account. After her father died intestate and the money was distributed
amongst herself and her five siblings rather than being paid directly to her, the daughter sued the financial
institution for breach of contract. Id. at 707. A jury returned a verdict in her favor and the Texas Supreme Court
affirmed the award, noting that the suit did not implicate the Texas Probate Code's protections against liability for
payment on joint accounts because "A.G. Edwards' failure to take sufficient steps to create the JTWROS account
necessary to establish Alicia's right of survivorship is a breach of a separate duty owed to Alicia." Id. at 708. The
context of the language in the opinion makes it clear that the Court was referring to the duties arising out of the
contract signed by Alicia and her father—"The evidence showed that Alicia and her father performed the steps
necessary to set up [an account], but A.G. Edwards did not perform as agreed." Id.
Here, in contrast, Claimants did not have a contractual relationship with Wells Fargo—there is no evidence that
they ever participated in the opening of the C.D.s or, as in Beyer, jointly executed any documents with Williams
that would have given them any rights to the funds at issue. We therefore find this case wholly distinguishable
from Beyer.
Accordingly, we hold that the trial court did not err by granting summary judgment in favor of Wells Fargo. We
overrule Claimants' issues.
Conclusion
The trial court did not err by granting summary judgment in Wells Fargo's favor on Claimants' First Amended
Petition. We overrule Claimants' issues on appeal and affirm the judgment of the trial court.
[1] First Community Bank Houston was later purchased by Wells Fargo and will be referred to as "Wells Fargo."
[2] First Community Bank San Antonio is a separate business entity with its own charter. It was not purchased by Wells Fargo.
Citibank credit card debt suits | Unifund-CCR-Partners plaintiff in credit-card-debt-suits | Credit card debt suits
appeal in Houstion Courts of Appeals |
HOUSTON APPEALS IN WELLS FARGO
BANK LITIGATION
SOUTHEAST TEXAS ENVIRONMENTAL, L.L.C., Appellant,
v.
WELLS FARGO BANK, N.A. F/K/A FIRST COMMUNITY BANK, N.A.,
Appellee.
No. 01-10-00076-CV.
Court of Appeals of Texas, First District, Houston.
Opinion issued August 11, 2011.
Panel consists of Justices JENNINGS, BLAND and MASSENGALE.
MEMORANDUM OPINION
MICHAEL MASSENGALE, Justice.
Southeast Texas Environmental, L.L.C. appeals from an order granting summary judgment in favor of Wells Fargo
Bank, N.A. f/k/a First Community Bank, N.A. Southeast Texas Environmental argues that the trial court erred in
granting Wells Fargo's no-evidence motion for summary judgment and in denying its motion for new trial and for
leave to file a supplemental response. Because Southeast Texas Environmental failed to produce evidence
necessary to raise a question of material fact as to damages, we affirm.
Background
In November 2002, Southeast Texas Environmental sued First Community Bank, which was later acquired by
Wells Fargo, for breach of contract and conversion. Southeast Texas Environmental alleged that the bank had
wrongfully taken business records and other property it owned during the execution of a writ of sequestration
against Hub City Environmental. Southeast Texas Environmental claimed that it suffered economic loss because
of its loss of the property held by the bank.
Wells Fargo filed a no-evidence motion for summary judgment, alleging that Southeast Texas Environmental
could not produce evidence to support the element of damages. In response, Southeast Texas Environmental
argued that the deposition testimony of three witnesses was sufficient to raise a question of material fact as to the
issue of damages. It also argued that the evidence established that it would be entitled to a jury instruction on
spoliation of evidence. Southeast Texas Environmental did not, however, file any of the evidence it discussed in
its pleading with the trial court.
The trial court granted summary judgment in favor of Wells Fargo. Southeast Texas Environmental filed a
combined motion for rehearing, new trial, and leave to file a supplemental response. It argued that the trial court
erred in granting Wells Fargo's motion for summary judgment because "as a result of a clerical error or mistake in
the calendaring [of the motion]," the court "[g]ranted the [m]otion without the evidence of damages properly
before it." Southeast Texas Environmental stated that the evidence attached to its supplemental response raised
a question of material fact as to damages and that the court should consider the evidence, grant its motion,
vacate the judgment in favor of Wells Fargo, and deny Wells Fargo's no-evidence motion. The trial court denied
this motion. Southeast Texas Environmental appealed, arguing that the trial court erred in granting Wells Fargo's
no-evidence motion for summary judgment and in denying its combined motion for new trial, rehearing, and leave
to file a supplemental response to the motion for summary judgment.
Analysis [omitted]
Conclusion
Because of our resolution of Southeast Texas Environmental's appellate points, we need not address the cross-
points raised by Wells Fargo. We affirm the judgment of the trial court.
Boss Hoss Cycles of Houston, LLC v. Wells Fargo Bank, NA (pdf) (Tex.App.- Houston [14th Dist.]
Jan. 26, 2010)(Brown) (dealer agreement contract dispute relating to assignment of retail installment contracts,
obligation to repurchase assigned contracts, failure to furnish evidence of perfection of security interest, breach
of agreement not excused)
AFFIRMED IN PART DISMISSED IN PART: Opinion by Justice Brown
14-08-00648-CV Boss Hoss Cycles of Houston, LLC and David Cesshier v. Wells Fargo Bank, N.A.
Appeal from County Civil Court at Law No 1 of Harris County
Trial Court Judge: R. Jack Cagle
BOSS HOSS CYCLES OF HOUSTON, L.L.C. AND DAVID CHESSHIR, Appellants,
v.
WELLS FARGO BANK, N.A., Appellee.
No. 14-08-00648-CV.
Court of Appeals of Texas, Fourteenth District, Houston.
Memorandum Opinion filed January 26, 2010.
Panel consists of Justices ANDERSON, BROWN, and BOYCE.
MEMORANDUM OPINION
JEFFREY V. BROWN, Justice.
In this contract dispute, a jury determined that a motorcycle dealer breached the terms of its agreement with a
bank. In three issues, the motorcycle dealer appeals the jury's verdict in favor of the bank on the grounds that the
bank failed to prove that the dealer breached its agreement with the bank, the dealer perfected the bank's
security interest in the motorcycle at issue, and even if the dealer did not perfect the bank's security interest in
the motorcycle, the dealer was excused from doing so as a matter of law. In addition, the motorcycle dealer asks
that we remand the case to enable it to recover attorneys' fees. Because we conclude that sufficient evidence
supports the jury's findings, we affirm the trial court's judgment.
I. FACTUAL AND PROCEDURAL BACKGROUND
In July 2003, appellant Boss Hoss Cycles of Houston, L.L.C. ("Boss Hoss") and appellee Wells Fargo Bank, N.A.
("Wells Fargo") entered into an agreement (the "Dealer Agreement') in which Boss Hoss, as a motorcycle dealer,
assigned installment contracts from the sale of motorcycles to Wells Fargo. Under the terms of the agreement,
Boss Hoss warranted, among other things, that as of the assignment of the installment contracts to Wells Fargo,
as a result of [Boss Hoss] making application for same, a Certificate of Title, or comparable evidence of the
perfection of [Wells Fargo]'s lien on the property as collateral for the [c]ontract will be issued by the lawful issuing
agency of the state in which the property is sold within 90 days of the date on which the [c]ontract was signed by
the purchaser, on which the "Lienholder," "Legal Owner," or other such terminology reflecting collateral ownership
with regard to the property is identified as [Wells Fargo.]
Boss Hoss further agreed to undertake actions requested by Wells Fargo to evidence and perfect [the Dealer
Agreement], [Wells Fargo]'s ownership interest in a [c]ontract and its proceeds, [Wells Fargo]'s ownership or
security interest in the related property financed and any [related rights.]
Finally, Boss Hoss agreed to repurchase any contract or any of Wells Fargo's ownership or security interest in the
financed property if Wells Fargo determined that Boss Hoss "breached any warranty, covenant or other duty to
[Wells Fargo] arising" under the Dealer Agreement. The repurchase price would be the amount of the unpaid
installment contract, including any premiums or other amounts due under the installment contract. Boss Hoss's
president and owner, David Chesshir, executed the agreement.
In August 2006, Boss Hoss sold a motorcycle to Ronald Elic at a motorcycle rally in Sturgis, South Dakota. Elic
executed a retail-installment contract for the purchase of the motorcycle at the time of the sale. Under the
contract, Elic agreed to make 84 monthly payments, beginning September 9, 2006, and ending August 9, 2013.
Wells Fargo approved Elic for financing and the contract was assigned to the bank. On August 10, 2006,
Chesshir wrote a letter on behalf of Boss Hoss (the "Guarantee Letter") to Wells Fargo, stating:
This letter will service [sic] as a guarantee of title on RONALD P. ELIC that Boss Hoss Cycles of Houston will
forward to WELLS FARGO BANK, N.A. all title papers on 2006 BOSS HOSS 502 BIKE, VIN NO:
1B96BC446D285250 upon receipt of MSO[1] and check in the amount of $ 35,300.00.
If Wells Fargo has not received the perfected title showing Wells Fargo as the lien holder within 90 days, Wells
Fargo may require the Dealership, (Boss Hoss Cycles of Houston), to repurchase the loan.
Wells Fargo paid Boss Hoss $35,300.00 for the assignment of the Elic contract. In September, Boss Hoss
endorsed the reverse-side of the MSO, notating Wells Fargo as a lienholder, and sent it to Elic. Elic did not apply
for a title on the motorcycle, and Wells Fargo did not receive a perfected title showing it as a lienholder within 90
days of the date of the Guarantee Letter.
Elic defaulted on the installment contract, and in May 2007, Wells Fargo notified Boss Hoss in writing that Wells
Fargo had never obtained a "perfected lien interest" on the loan. Wells Fargo stated that under the terms of the
Dealer Agreement and the Guarantee Letter, Boss Hoss was required to repurchase the loan and that the payoff
amount of the Elic contract was $32,705.54. Boss Hoss did not provide the funds to Wells Fargo, and Wells Fargo
filed suit against Boss Hoss and Chesshir for breach of contract and conversion.[2]
Before trial, the trial court granted partial summary judgment, concluding that (a) Missouri law governed the
perfection of Wells Fargo's security interest in the motorcycle purchased by Elic, (b) a security interest under
Missouri law can only be perfected by delivery of a notice of lien to the Missouri director of revenue, and (c) Boss
Hoss did not perfect Wells Fargo's security interest in the motorcycle. The case proceeded to a jury trial.
At trial, Chesshir testified that, pursuant to the Dealer Agreement, Boss Hoss agreed to take "such action as
necessary" or as Wells Fargo requested to perfect its security interest. He also agreed that Boss Hoss warranted
it would repurchase any installment contract if Boss Hoss breached any warranty or duty arising out of the Dealer
Agreement. He admitted that he sent the Guarantee Letter to Wells Fargo, and that Boss Hoss received the
$35,300 from Wells Fargo. In addition, the following colloquy occurred between Chesshir and the attorney
representing Wells Fargo:
Q.: You promised Wells Fargo Bank, as the owner of Boss Hoss, that if they paid you $35,300, you would
guarantee that Wells Fargo would get a perfected title; isn't that correct?
A.: I don't know how to answer that.
Q.: You need to answer yes or no, Mr. Chesshir.
A.: Yes.
Chesshir also explained that Wells Fargo approved the loan to Elic. He testified that "title work" was provided to
Wells Fargo in the form of a copy of the front side of the MSO. Accoding to Chesshir, an MSO is a form of a title,
but not a certificate of title. He stated that other out-of-state sales had been handled in a similar manner with
Wells Fargo without any problems. Chesshir explained that he took several actions to protect Wells Fargo's
security interest: (1) he filled out the back side of the MSO with Wells Fargo listed as the lienholder and sent it to
Elic; (2) he called Elic numerous times when Wells Fargo notified him that Elic had not titled the vehicle; (3) he
provided Wells Fargo with Elic's contact information and insurance information when Wells Fargo notified him that
Elic had missed payments; (4) he suggested that Wells Fargo inform Elic's motorcycle insurance provider that Elic
had failed to title the motorcycle; and (5) he offered to pick up the motorcycle if Wells Fargo decided to repossess
it. Chesshir further admitted that Boss Hoss provided no evidence of a perfected lien to Wells Fargo for this
particular transaction and that, without an MSO, a party cannot get a certificate of title. According to Chesshir,
Wells Fargo decided not to repossess the motorcycle, and shortly after sending him a demand letter regarding
repurchasing the Elic contract, Wells Fargo notified him that it would no longer be financing motorcycles. Chesshir
also stated that he believed the Dealer Agreement only applied to transactions occurring in Texas, and that the
only reason Boss Hoss had not gotten the motorcycle titled in Missouri for Wells Fargo was that it would be illegal
for it to do so.
Mary Walker, a representative of Wells Fargo, testified that the Elic loan was in default. When questioned about
repossessing the motorcycle, she stated that Wells Fargo could not repossess the motorcycle without a perfected
title. She admitted that she was unaware that, under Missouri law, Wells Fargo could have notified the Missouri
director of revenue of its lien on the motorcycle to perfect its security interest. Finally, both attorneys for Wells
Fargo and Boss Hoss testified regarding reasonable attorneys' fees for handling this dispute.
The trial court charged the jury, and the jury unanimously determined that Boss Hoss failed to comply with its
"Agreement" with Wells Fargo, and that its failure to comply was not excused. The jury found (a) $32,705.54 in
damages for Boss Hoss's failure to comply with the agreement and (b) $15,522.94 to be reasonable attorneys'
fees for prosecution of Wells Fargo's claims through trial.[3] Boss Hoss and Chesshir filed a motion for judgment
notwithstanding the verdict, contending that the evidence conclusively established that it perfected Wells Fargo's
security interest and, if it did not, its failure to do so was excused as a matter of law. After denying Boss Hoss's
and Chesshir's motion for judgment notwithstanding the verdict, the trial court entered judgment against them.
Boss Hoss and Chesshir filed a motion for new trial, which was overruled by operation of law, and this appeal
timely ensued.
II. ISSUES PRESENTED
In its first issue, Boss Hoss asserts that Wells Fargo did not prove that Boss Hoss breached the Dealer
Agreement. Boss Hoss contends that it perfected Wells Fargo's security interest in its second issue. In issue
three, Boss Hoss argues that, if it did not perfect Wells Fargo's security interest, its failure to do so was excused
as a matter of law. Finally, Boss Hoss asks that the case be remanded so that it can recover attorneys' fees in
issue four.
III. ANALYSIS
A. Dismissal of Chesshir's Appeal
The pleadings, judgment, and notice of appeal filed in the trial court all reference both Boss Hoss and Chesshir
as parties. But the appellate brief filed by Boss Hoss in this court lists only Boss Hoss as a party; Chesshir is not
included as a party. On September 9, 2009, this court notified the parties that we would consider dismissal of
Chesshir's appeal for want of prosecution if no party filed a response on or before September 21, 2009, showing
meritorious grounds for continuing the appeal. This letter additionally advised Chesshir that he could join Boss
Hoss's brief. No response was filed to this letter. Thus, we order Chesshir's appeal dismissed for want of
prosecution.
B. Perfection of Security Interest
Boss Hoss's second and third issues specifically concern whether it perfected Wells Fargo's security interest in
the motorcycle. These issues appear to be challenges to the trial court's pre-trial partial summary judgment that
Missouri law applies to this dispute and that Boss Hoss failed to perfect Wells Fargo's security interest in the
motorcycle under Missouri law. But Boss Hoss provides no argument or authority regarding a choice-of-law issue.
Thus, to the extent that these challenges relate to the trial court's choice-of-law determinations, they are
inadequately briefed and are waived. See Tex. R. App. P. 38.1(i) ("The brief must contain a clear and concise
argument for the contentions made, with appropriate citations to authorities and to the record."); see also Priddy
v. Rawson, 282 S.W.3d 588, 595 (Tex. App.-Houston [14th Dist.] 2009, pet. denied) (stating that it is not the duty
of an appellate court to perform an independent review of the summary-judgment record for evidence supporting
an appellant's position).
Further, the questions presented to the jury did not concern whether Boss Hoss perfected Wells Fargo's security
interest in the motorcycle subject to the retail-installment contract. Instead, the questions the jury was asked
concerned whether Boss Hoss failed to comply with its agreement with Wells Fargo and whether this failure, if any,
was excused. Neither the Dealer Agreement nor the Guarantee Letter required Boss Hoss to perfect Wells
Fargo's security interest; instead, both required Boss Hoss to provide evidence to Wells Fargo that the security
interest was perfected. Thus, rather than considering whether Boss Hoss "perfected" Wells Fargo's security
interest in the motorcycle, we confine our review to the issues actually before the jury: whether Boss Hoss
breached its agreement with Wells Fargo, and if so, whether the breach was excused.
C. Failure to Comply with the Agreement
Under its first issue, Boss Hoss argues (1) Wells Fargo did not plead that Boss Hoss breached the Dealer
Agreement and instead alleged that Chesshir breached the agreement; (2) the only breach Wells Fargo alleges is
that Boss Hoss violated the laws of the State of Texas, but the trial court concluded that Missouri law governed
this dispute, hence the duties alleged by Wells Fargo are inapplicable; (3) delivery of the MSO to a buyer does
not constitute a breach of the Dealer Agreement because Wells Fargo was not deprived of a means of perfecting
a security interest in the motorcycle; and (4) there "is no pleading or evidence" that Boss Hoss breached the
Dealer Agreement.
As to the first two of these arguments, Wells Fargo pleaded that Boss Hoss breached the Dealer Agreement by
failing to provide it with evidence of lien perfection within 90 days as promised in the agreement. Wells Fargo
further alleged that Boss Hoss breached the Guarantee Letter. Thus, Boss Hoss's first two arguments are without
merit. Turning to the third argument, it is immaterial whether the delivery of the MSO to Elic constituted a breach
of the Dealer Agreement; rather, the definitive issue is whether sufficient evidence supports the jury's verdict that
Boss Hoss breached an agreement with Wells Fargo. We thus turn to Boss Hoss's fourth argument under this
issue: whether there is proof that Boss Hoss breached the Dealer Agreement.
First, the question presented to the jury was not limited to whether Boss Hoss breached the Dealer Agreement.
Rather, the question presented to the jury was this: "Did Boss Hoss Cycles of Houston, L.L.C. fail to comply with
its Agreement with Wells Fargo Bank, N.A.?" The term "Agreement" was not defined in the jury charge;[4] thus, it
could have applied to either the Dealer Agreement or the Guarantee Letter. We therefore consider whether there
is legally sufficient evidence to support the jury's finding that Boss Hoss breached either the Dealer Agreement or
the Guarantee Letter.
To determine whether the evidence is legally sufficient to support the judgment, we review the entire record,
crediting favorable evidence if reasonable jurors could and disregarding contrary evidence unless reasonable
jurors could not. See City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). We assume that jurors decided
questions of credibility or conflicting evidence in favor of the verdict if they reasonably could do so. Id. at 819,
820. We do not substitute our judgment for that of the trier-of-fact if the evidence falls within this zone of
reasonable disagreement. Id. at 822. If the evidence would enable reasonable and fair-minded people to differ in
their conclusions, then it is legally sufficient to support the verdict.Id.
As detailed above, under the unambiguous terms of the Dealer Agreement, Boss Hoss was required to provide
evidence to Wells Fargo of a perfected security interest in the property as collateral for any assigned contracts. If
Boss Hoss breached the duties imposed by the Dealer Agreement, Wells Fargo could require it to repurchase the
contract. Further, under the similarly unambiguous terms of the Guarantee Letter, Wells Fargo could require Boss
Hoss to repurchase Elic's loan contract if Wells Fargo did not receive a "perfected title showing Wells Fargo as
the lien holder within 90 days" of the date of the letter. It is undisputed that Wells Fargo did not receive a
perfected title showing it as the lien holder for the motorcycle that was the subject of the Elic contract within either
90 days of the date of the contract or 90 days of the date of the Guarantee Letter.[5] Indeed, both Chesshir and
Walker testified that perfection of Wells Fargo's security interest in the motorcycle did not occur. We thus
conclude that there is legally sufficient evidence to support the jury's conclusion that Boss Hoss did not comply
with either the Dealer Agreement or the Guarantee Letter.
D. "Excuse" for Failure to Comply with Agreement
Next, in an abundance of caution, we consider whether there is legally sufficient evidence to support the jury's
negative answer to the question, "Was [Boss Hoss's] failure to comply [with its agreement with Wells Fargo]
excused?" Boss Hoss argues that it would have been impossible for it to perfect Wells Fargo's security interest
under Missouri law because only a lienholder or a licensed agent may create a lien on a motor vehicle under
Missouri law. It contends that, because Chesshir testified it would have been illegal for Boss Hoss to attempt to file
a notice of lien to perfect Wells Fargo's security interest in Missouri, any requirement under the Dealer Agreement
that Boss Hoss do so must be excused. See, e.g., Centex Corp. v. Dalton, 840 S.W.2d 952, 954 (Tex. 1992)
(discussing the defense of supervening impossibility due to a change in law).[6]
This argument is based on the faulty premise that Boss Hoss was required, under the Dealer Agreement or the
Guarantee Letter, to perfect Wells Fargo's security interest itself. As discussed above, however, neither of these
agreements required Boss Hoss to perfect the security interest. Instead, both agreements required Boss Hoss to
provide evidence to Wells Fargo that its security interest in the motorcycle was perfected. It is undisputed that
Boss Hoss failed to provide any evidence of a perfected security interest in the motorcycle to Wells Fargo.
Further, instead of providing the MSO to Wells Fargo so that it could perfect its own security interest, Boss Hoss
sent the MSO to Elic, who failed to title the motorcycle. We thus conclude that there is legally sufficient evidence
to support the jury's finding that Boss Hoss's failure to comply with its agreement(s) with Wells Fargo was not
excused.[7]
IV. CONCLUSION
First, Chesshir's appeal is dismissed for want of prosecution. Second, we conclude that legally sufficient evidence
supports the jury's finding that Boss Hoss failed to comply with its agreement(s) with Wells Fargo and that its
failure to do so was not excused. We therefore overrule its first issue. Additionally, Boss Hoss has waived its
second and third issues by failing to adequately brief them, and they are overruled. Finally, because Boss Hoss
has not established that the jury's verdict was erroneous, it is not entitled to attorneys' fees.[8] We therefore
overrule Boss Hoss's fourth issue and affirm the trial court's judgment.
[1] MSO stands for "Manufacturer's Statement of Origin." According to Chesshir, such a form is the first document in a chain of title.
The MSO comes from the factory to the dealership and then later is transferred into a certificate of title.
[2] The jury charge contained no questions regarding conversion.
[3] The jury also found $2,500 to be reasonable attorneys' fees for prevailing on an appeal to an intermediate court, $1,500 for
responding to a petition for review in the Supreme Court, and $1,500 for prevailing in the Supreme Court if a petition for review were
granted.
[4] Boss Hoss neither objected to the jury charge nor complains of charge error on appeal.
[5] It is also undisputed that the amount owed on the loan at the time Elic defaulted was $32,705.54; the Dealer Agreement explicitly
provided that the repurchase price would be the amount of the unpaid installment contract.
[6] Centex Corp. is the only case cited in the entirety of Boss Hoss's appellate brief.
[7] At trial, as detailed above, Chesshir indicated that Boss Hoss previously had handled out-of-state sales in a similar manner as
this one was handled without any problems or complaints from Wells Fargo. He also explained the actions he took to protect Wells
Fargo's security interest in the bike. He testified that "title work" was provided to Wells Fargo in the form of a copy of the MSO. Finally,
he stated that he believed the Dealer Agreement only applied to transactions occurring in Texas. But none of these arguments have
been made on appeal. Thus, if any of these efforts would have "excused" Boss Hoss's failure to comply with its agreement(s) with
Wells Fargo, they have been waived on appeal.
[8] Under the terms of the contract, only the prevailing party in any legal proceedings is entitled to recover attorneys' fees and costs.
Further, the Texas Civil Practice and Remedies Code provides for the award of attorneys' fees only to a prevailing party in a breach
of contract case. See TEX. CIV. PRAC. & REM. CODE ANN. § 38.001(8) (Vernon 2008).
WELLS FARGO BANK, N.A. AS TRUSTEE FOR THE REGISTERED HOLDERS OF CREDIT SUISSE FIRST
BOSTON MORTGAGE SECURITIES CORP., COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2005-C6, ACTING BY AND THROUGH TORCHLIGHT LOAN SERVICES, LLC AS SPECIAL SERVICER,
Appellant,
v.
JRK-VILLAGES AT MEYERLAND, LLC, Appellee.
No. 01-10-01076-CV.
Court of Appeals of Texas, First District, Houston.
Opinion issued January 6, 2011.
Panel consists of Justices JENNINGS, HIGLEY and BROWN.
MEMORANDUM OPINION
HARVEY BROWN, Justice.
Wells Fargo Bank, N.A. appeals the trial court's November 19, 2010 amended order appointing a receiver. JRK-
Villages at Meyerland, LLC moved to dismiss, asserting this Court lacks jurisdiction over this appeal. We dismiss
for want of jurisdiction.
Background
Wells Fargo applied for a receiver alleging that JRK-Villages had defaulted in making payments due under a
promissory note. The note is secured by a deed of trust for the property at issue in this appeal, as well as a rent
assignment. Wells Fargo sought a receiver on the grounds that the property was "in danger of being lost,
removed, or materially injured." The trial court appointed a receiver on October 29, 2010. In the order appointing
the receiver, the trial court ordered that a nonjudicial foreclosure should occur in December 2010.
Wells Fargo, dissatisfied with the December 2010 condition, moved to amend the order appointing a receiver.
Specifically, Wells Fargo asked for the trial court to delete or, alternatively, amend the portion of the order
requiring a sale in December, asserting that it was insufficient time to conduct a proper sale and realize the best
price on the property. The trial court granted the motion and issued an amended order. The only change
pertinent to this appeal is the change in the deadline from December 2010 to February 1, 2011. Within 20 days of
the amended order, Wells Fargo filed its notice of appeal.
Jurisdiction
"Appellate courts have jurisdiction to consider immediate appeals of interlocutory orders only if a statute expressly
provides appellate jurisdiction."
Benefield v. State, 266 S.W.3d 25, 29 (Tex. App.-Houston [1st Dist.] 2008, no pet.). Section 51.014(a)(1)
authorizes an interlocutory appeal from an order that "appoints a receiver or trustee." TEX. CIV. PRAC. & REM.
CODE ANN. § 51.014(a)(1) (Vernon 2008). Texas courts strictly construe statutes authorizing interlocutory
appeals. Benefield, 266 S.W.3d at 30.
Wells Fargo is not appealing an order appointing a receiver. Wells Fargo asked for the appointment of a receiver,
but appeals a condition the trial court imposed upon the receiver. Section 51.014(a) does not address orders
modifying or amending the terms of a receiver's appointment. Construing section 51.014(a) strictly, as we must,
we conclude we lack jurisdiction over this appeal. See TEX. CIV. PRAC. & REM. CODE ANN. § 51.014(a)(1).
Furthermore, this Court has held that section 51.014(a)(1) requires a party to appeal within 20 days of the
original order appointing a receiver. Sclafani v. Sclafani, 870 S.W.2d 608, 611 (Tex. App.-Houston [1st Dist.]
1993, writ denied). Id. More than 20 days passed from the order appointing a receiver before Wells Fargo
appealed the amended order. Thus, the notice of appeal was untimely. See TEX. R. APP. P. 26.1(b) (stating
notice of appeal in accelerated case must be filed within 20 days after judgment or order); id. 28.1(a) (stating
appeals from interlocutory orders, when allowed, are accelerated).
Conclusion
We grant JRK-Villages's motion and dismiss this cause for want of jurisdiction.
RUSSELL SCOTT CLARK, et al, Appellants,
v.
WELLS FARGO BANK, N.A., SUCCESSOR-IN-INTEREST TO FIRST COMMUNITY BANK, N.A.,
Appellee.
No. 01-08-00887-CV.
Court of Appeals of Texas, First District, Houston.
Opinion issued June 10, 2010.
Panel consists of Justices KEYES, ALCALA and HANKS.
MEMORANDUM OPINION
GEORGE C. HANKS, JR., Justice.
In this dispute over survivorship rights to several certificates of deposit ("CDs"), appellants, Russell Scott Clark,
Jerry Ann Clark, Levi Clifford Clark, Cayleigh Rene, a minor child by and through Russell Scott Clark, Chance
Parker, a minor child by and through Russell Scott Clark, Whitney Blair Clark, a minor child by and through
Russell Scott Clark, Brett Allen Metcalf, Robin Renee Metcalf Saxon, Brandon Dean Metcalf, a minor child by and
through Robin Renee Metcalf Saxon, Shanon Kay Small, and Jordan Dane Small, a minor child by and through
Shanon Kay Small (collectively "Claimants"), contend that the trial court erred in granting summary judgments in
favor of appellees, Wells Fargo Bank, N.A., successor-in-interest to First Community Bank, N.A., ("Wells Fargo").
In this instant appeal, Claimants allege that Wells Fargo tortiously interfered with their inheritance rights and was
negligent with respect to the CDs and that the trial court therefore erred by granting summary judgment in Wells
Fargo's favor.
We affirm.
Background
In the early 1990s, Parker Williams purchased six CDs from First Community Bank Houston (the "Original CDs").
[1] These CDs, which totaled $1,253,907.50, carried the name of Williams and Claimants and were each marked
as a "Multiple-Party Account with Right of Survivorship." The Original CDs provided:
Multi-Party Account with Right of Survivorship — The parties to the account own the account in proportion to the
parties' net contributions to the account. We may pay any sum in the account to a party at any time. On the death
of a party, the party's ownership of the account passes to the surviving parties.
Withdrawals — Unless otherwise clearly indicated on the account records, any one of you who signs this form
including authorized signors may withdraw or transfer all or any part of the account balance at any time on forms
approved by us.
Williams was the only one who signed the account agreements, and Claimants were unaware that the CDs existed.
In July of 2004, Williams met with a Wells Fargo employee in Houston and was told that the CDs were not fully
covered by Federal Deposit Insurance Corporation ("FDIC") insurance. Williams was advised that the First
Community Bank San Antonio, N.A.[2] could provide her with the requisite excess deposit insurance coverage.
She purchased six new fully-insured CDs at the San Antonio location (the "New CDs"). These New CDs were set
up in Williams's name only, and she initialed the "Single-Party Account Without `P.O.D.' Designation" on each of
the account agreements. The new accounts provided:
Single-Party Account Without P.O.D. Designation — The party to the account owns the account. On the death of
the party, ownership of the account passes as a part of the party's estate under the party's will or by intestacy.
One month later, on August 25, 2004, Williams died intestate. Claimants are not Williams's heirs or legatees
under the laws of intestate distribution.
On March 23, 2005, upon request from Williams's administrator, Wells Fargo wired the funds from the New CDs to
Williams' estate ("the Estate"). One month later, on April 29, 2005, Claimants filed a presentment of claim in the
probate court demanding payment of the CDs. The Estate denied the claim, and Wells Fargo filed a lawsuit,
seeking declaratory judgment.
Wells Fargo's petition for declaratory judgment sought (1) a determination of the construction and validity of the
CDs; (2) a declaration of rights, status, or other legal relations between Wells Fargo, Williams's estate, and
Claimants; (3) a declaration of rights, if any, of Claimants to the CDs at the time of Williams's death; and (4) a
determination of any other questions as to any of Claimants' ownership of the CDs other than as Williams's heirs.
Claimants filed an original third-party petition that sought resolution to the same issues presented by Wells Fargo.
Three months later, Wells Fargo filed a traditional motion for interlocutory summary judgment asking the trial court
to issue a declaration regarding (1) the validity and enforceability of the account documents underlying the
Original CDs; (2) whether Williams was a person with the right to withdraw or transfer the funds represented by
the Original CDs; (3) whether Williams had the right to withdraw or transfer at any time all or any part of the funds
represented by the Original CDs; and (4) Wells Fargo's discharge from claims for amounts paid by or on behalf of
Wells Fargo to Williams as proceeds from the Original CDs. The Estate adopted Wells Fargo's traditional motion
for summary judgment and also filed a no-evidence summary judgment.
Claimants subsequently amended their petition to assert, for the first time, affirmative tort claims against the
Estate and Wells Fargo. Specifically, Claimants allege that it was "unnecessary for Parker Williams to modify the
multi-party [CDs] and that Parker Williams intended for Claimants to receive the funds contained within the [CDs]
that were transmitted to the [Estate]." Claimants alleged, in the alternative, that, if the court determined that the
Estate is the rightful owner of the New CDs, "Wells Fargo tortiously interfered with Claimants' inheritance rights."
Claimants further alleged that "Wells Fargo was negligent with respect to banking, investment, and FDIC
coverage advice provided to Parker Williams."
On August 3, 2006, the trial court ordered as follows:
1. Judgment that the Account documents underlying the Original CDs are valid and enforceable against Claimants.
2. Judgment that PARKER WILLIAMS was a person with the right to withdraw or transfer the funds represented by
the Original CDs.
3. Judgment that PARKER WILLIAMS had the right to withdraw or transfer at any time all or any part of the funds
represented by the Original CDs.
4. Judgment that WELLS FARGO is discharged from claims for amounts paid by or on behalf of Plaintiff to
PARKER WILLIAMS as proceeds from the Original CDs.
5. An award of attorney's fees in the amount of $18,012.00.
6. Judgment for its costs of suit.
Wells Fargo's case was severed from the remaining action. The trial court granted the Estate's traditional and no-
evidence motions for summary judgment.
Claimants filed an appeal to this Court. See Clark v. Wells Fargo Bank, Nos. 01-06-896-CV and 01-07-00165-CV,
2008 WL 866499 (Tex. App.-Houston [1st Dist.] 2008, no pet.) ("Clark I "). In Clark I, we dismissed Claimants'
appeal of the summary judgment in Wells Fargo's favor for want of jurisdiction, holding that the court's judgment
was not final because Wells Fargo's motion for summary judgment had not addressed the tort claims that
Claimants added to their petition after the motion was filed. We affirmed the summary judgment in favor of the
Estate.
On remand, Wells Fargo filed traditional and no-evidence motions for summary judgment that specifically
addressed Claimants' new tort claims. In its motions for summary judgment filed after remand, Wells Fargo first
argued that the tort claims asserted in Claimants' First Amended Petition were resolved, in part, by the trial court's
interlocutory judgment on its first round of summary judgment motions, and that, consequently, "Wells Fargo is
absolved from liability for any and all claims related to the closing and/or payment of the Original CDs. Any
purported tort claims that Claimants assert against Wells Fargo would need to rely exclusively on tortious actions
taken after (1) the Original CDs were closed and (2) Claimants' contingency interests in the Original CDs
extinguished." For their part, Claimants seem to agree, conceding "Claimants' live pleading relates to the new
CDs and tortious actions taken by Wells Fargo after the original CDs were closed."
Wells Fargo moved for traditional summary judgment on Claimants' negligence and tortious interference with
inheritance on the following grounds: (1) Texas Probate Code section 448 discharges Wells Fargo from liability
for payment or transfer of the Original CDs; (2) Claimants lacked an expectancy interest in the New CDs; and (3)
Claimants were strangers to the New CDs and Wells Fargo did not owe any duty to Claimants relating to the New
CDs.
Wells Fargo's no-evidence motion for summary judgment asserted that Claimants' tortious interference claim
should be dismissed because Claimants failed to present any evidence of (a) an expectancy interest in the New
CDs, (b) that Wells Fargo intentionally interfered with Claimants' expectancy interest, (c) that such interference
constituted conduct tortious in itself, and (d) that there was a reasonable certainty that the funds at issue would
have been received by Claimants but for Wells Fargo's purported tortious interference. Similarly, Wells Fargo
alleged that Claimants failed to present any evidence on their negligence claims regarding (a) any duty Wells
Fargo owed Claimants or (b) any breach of any such duty owed to Claimants.
The trial court granted Wells Fargo's traditional and no-evidence motions for summary judgment, and this appeal
followed.
Claimants now argue that the trial court erred by granting Wells Fargo's traditional and no-evidence motions for
summary judgment. Essentially, Claimants contend that they had an interest in the New CDs and that Wells Fargo
tortiously interfered with that interest.
Analysis
A. Standard of Review [summary judgment standard]
B. Texas Probate Code Section 448
On appeal, Claimants argue that Texas Probate Code section 448 does not bar their tort claims relating to the
New CDs, which were issued after Parker Williams closed the original multi-party CDs at Wells Fargo. Specifically,
Claimants argue that Texas Probate Code section 448 does not apply to the New CDs because the New CDs are
single-party accounts and section 448, by its plain language, applies only to multiple-party CDs such as the
original CDs. In addition, Claimants argue that section 439A(a) of the Probate Code limits the protections of
section 448 and prevents it from applying to the New CDs in this case.
Section 444 of the Probate Code allows for the creation of multiple-party accounts at financial institutions and
states, "A multiple-party account may be paid, on request, to any one or more of the parties." Tex. Prob. Code
Ann. § 444 (Vernon 2003). Section 448 provides, in part,
Payment made as provided by Section 444 . . . of this code discharges the financial institution from all claims for
amounts so paid whether or not the payment is consistent with the beneficial ownership of the account as
between parties, P.O.D. payees, or beneficiaries, or their successors.
Id. § 448. Claimants also point to section 439A(a), which at the time stated that the "the provisions of this part of
Chapter XI of this code govern an account . . . other than a single-party account without a P.O.D. designation." Id.
§ 439A(a) (amended 2009).
Claimants do, however, concede that "[u]nder Section 448, Wells Fargo was discharged from claims for the
`payment' it made to Parker as a joint owner when it closed the original CDs." This concession is in accordance
with both section 448 and with case law. See, e.g., Bandy v. First State Bank, 835 S.W.2d 609, 615-16 (Tex.
1992) (holding bank not liable for paying funds to one of named holders of a joint account, even after executor of
other named holder's estate demanded payment); MBank Corpus Christi, N.A. v. Shiner, 840 S.W.2d 724, 727
(Tex. App.-Corpus Christi 1992, no writ) ("Thus, between competing interests in a joint account, the bank is fully
discharged from liability when it pays the other party on the account, unless one of the parties gives written notice
to the bank that no payment should be made.").
Thus, to the extent that any of Claimants' causes of action relate to the Original CDs or to actions taken before
the Original CDs were closed, those claims are barred by section 448. Our analysis of Claimants' tort claims will
therefore focus on whether the trial court erred by granting summary judgment on the causes of action Claimants
asserted against Wells Fargo based on any acts or omissions by Wells Fargo that occurred after the Original CDs
were closed—i.e., whether Wells Fargo tortiously interfered with or was negligent with respect to any interests
Claimants may have had in the New CDs.
C. Tortious Interference with Inheritance
This Court recognized the potential cause of action for tortious interference with inheritance in King v. Acker, 725
S.W.2d 750 (Tex. App.-Houston [1st Dist.] 1987, no writ). Citing the Restatement (Second) of Torts and caselaw
from other jurisdictions, King stated that "[o]ne who by fraud, duress or other tortious means intentionally prevents
another from receiving from a third person an inheritance or gift that he would otherwise have received is subject
to liability to the other for loss of the inheritance or gift." 725 S.W.2d at 754. Comment c to Restatement section
774B explains that "the liability stated in this Section is limited to cases in which the actor has interfered with the
inheritance or gift by means that are independently tortious in character." Restatement (Second) of Torts § 774B
cmt. c (1979). Comment d further requires "proof amounting to a reasonable degree of certainty that the bequest
or devise would have been in effect at the time of the death of the testator or that the gift would have been made
inter vivos if there had been no such interference." Id. at cmt. d.
Thus, in order to sustain a cause of action for tortious interference with inheritance, a plaintiff must present some
evidence that he in fact stood to inherit or receive the property at issue. Claimants did not provide any evidence
in response to Wells Fargo's motion for no-evidence summary judgment that they actually had an interest in the
New CDs such that they could sustain a cause of action for tortious interference. See, e.g., In re Estate of
Kuykendall, 206 S.W.3d 766, 771 (Tex. App.-Texarkana 2006, no pet.) (upholding instructed verdict on claim of
tortious interference with inheritance because "[p]laintiffs offered nothing to establish there was anything to which
they were entitled that Harold prevented them from receiving.").
Further, Claimants have produced no evidence of any intentional tortious conduct by Wells Fargo—instead, much
of the evidence upon which they rely was excluded by the trial court. See, e.g., Little v. Needham, 236 S.W.3d
328, 331 (Tex. App.-Houston [1st Dist.] 2007, no pet.) (when trial court sustained objection to summary judgment
evidence and briefing on appeal relied on evidence but did not attack merits of trial court's ruling, appellate court
may not consider the evidence) (citing Inglish v. Prudential Ins. Co. of America, 928 S.W.2d 702, 706 (Tex. App.-
Houston [1st Dist.] 1996, writ denied)).
D. Negligence
Claimants also argue that Wells Fargo was negligent when it failed to take sufficient steps to protect Claimants'
inheritance rights when opening the New CDs in San Antonio without a right of survivorship. In addition, Claimants
argue that Wells Fargo owed them a duty because it knew of their interests in the Original CDs and knew that
they had rights of survivorship on those prior CDs. Claimants argue that, when harm is foreseeable, a duty exists.
[elements of negligence]
Wells Fargo filed a no-evidence summary judgment motion as to each of the three elements. Further, Wells
Fargo's traditional motion for summary judgment argued that Wells Fargo did not have any duty to Claimants and
that Claimants' allegations were an "attempt to piggyback on purported actions directed toward Williams because
Claimants had no dealings whatsoever with Wells Fargo." Alternatively, Wells Fargo argued that any duty it may
have had to Claimants would have been grounded in the account documents governing the original CDs and
would thus be based in contract.
We agree with Wells Fargo's first contention and thus need not reach the others. Claimants' pleadings reveal that
all of the actions for which Claimants seek to recover on their negligence cause of action were directed at Parker
Williams and related to the duties Wells Fargo owed to Williams. With regard to Wells Fargo's actions relating to
the New CDs, Claimants' First Amended Petition alleged that
Wells Fargo was negligent with respect to banking, investment, and FDIC coverage advice provided to Parker
Williams. Wells Fargo owed a duty (both common law and as a fiduciary) to Claimants as co-owners of the multi-
party certificates of deposit to provide sound and accurate advice regarding applicable insurance coverage on
the certificates of deposit. Wells Fargo also had a duty to inquire as to the type of account Parker Williams
desired after it was represented by Wells Fargo that the certificates of deposit were not fully insured. Because
Wells Fargo failed to provide and/or obtain adequate and correct information, Parker Williams was forced to
modify her certificates of deposit which consequently led to the loss of inheritance on behalf of the Claimants.
In addition, none of these allegations relate to actions taken after the closing of the original CDs. There is no
evidence that Wells Fargo owed any legal duty to Claimants.
Claimants point us to A.G. Edwards & Sons v. Beyer, 235 S.W.3d 704 (Tex. 2007), which they argue stands for
the proposition that banks have independent duties to persons with potential inheritance rights in investment
vehicles. The facts of Beyer, however, are clearly distinguishable from this case. In Beyer, a father and daughter
sought to open a joint account with a right of survivorship and they signed and delivered documents to that effect,
thus creating a contract between themselves and the financial institution. The financial institution lost the
documents prior to actually opening the account. After her father died intestate and the money was distributed
amongst herself and her five siblings rather than being paid directly to her, the daughter sued the financial
institution for breach of contract. Id. at 707. A jury returned a verdict in her favor and the Texas Supreme Court
affirmed the award, noting that the suit did not implicate the Texas Probate Code's protections against liability for
payment on joint accounts because "A.G. Edwards' failure to take sufficient steps to create the JTWROS account
necessary to establish Alicia's right of survivorship is a breach of a separate duty owed to Alicia." Id. at 708. The
context of the language in the opinion makes it clear that the Court was referring to the duties arising out of the
contract signed by Alicia and her father—"The evidence showed that Alicia and her father performed the steps
necessary to set up [an account], but A.G. Edwards did not perform as agreed." Id.
Here, in contrast, Claimants did not have a contractual relationship with Wells Fargo—there is no evidence that
they ever participated in the opening of the C.D.s or, as in Beyer, jointly executed any documents with Williams
that would have given them any rights to the funds at issue. We therefore find this case wholly distinguishable
from Beyer.
Accordingly, we hold that the trial court did not err by granting summary judgment in favor of Wells Fargo. We
overrule Claimants' issues.
Conclusion
The trial court did not err by granting summary judgment in Wells Fargo's favor on Claimants' First Amended
Petition. We overrule Claimants' issues on appeal and affirm the judgment of the trial court.
[1] First Community Bank Houston was later purchased by Wells Fargo and will be referred to as "Wells Fargo."
[2] First Community Bank San Antonio is a separate business entity with its own charter. It was not purchased by Wells Fargo.
