RALPH K. BURGESS, Justice.
This case involves a complicated dispute between Circle Ridge Production, Inc. (Circle Ridge), and Kevin Stephens against Great Northern Energy, Inc. (Great Northern), arising out of the sale and foreclosure of certain oil and gas interests in Harrison County. We affirm the trial court's judgment in part and reverse in part.
A. Summary of the Dispute
Briefly, Circle Ridge and Stephens sold certain oil and gas leases referred to by the parties as the O'Benco leases
Subsequently, Great Northern defaulted on the promissory note, and Circle Ridge instituted foreclosure of the O'Benco leases against Great Northern. Great Northern's interests in the O'Benco leases were sold at public auction, and Circle Ridge acquired all of Great Northern's interests in the O'Benco leases by virtue of its winning bid. However, Great Northern continued its physical possession of the wells included in the O'Benco leases despite the foreclosure. Great Northern took the position that because Stephens had assigned his interests in the O'Benco leases to it as part of the Rangeford Resources agreement, and because the deed of trust listed both Circle Ridge and Stephens as the "beneficiary [sic]," Circle Ridge could not institute foreclosure by itself. Circle Ridge and Stephens asserted that Stephens never assigned his interests in the O'Benco leases to Great Northern because the Rangeford Resources agreement was never completed.
Both parties filed suit, and the two suits were ultimately consolidated in the 71st Judicial District Court of Harrison County. The case proceeded to trial on Circle Ridge's claims for trespass to try title and breach of contract against Great Northern as well as Great Northern's claims against Circle Ridge and Stephens for breach of contract and breach of the duty of good faith and fair dealing and a competing claim of trespass to try title. The trial court granted a directed verdict in favor of Stephens on Great Northern's breach of contract claim and granted both Stephens and Circle Ridge directed verdicts on Great Northern's breach of the duty of good faith and fair dealing claims. The trial court also granted a directed verdict in favor of Circle Ridge on its own breach of contract claim against Great Northern.
The case then proceeded to trial before the jury and Great Northern's wrongful foreclosure claim. The jury found in favor of Circle Ridge and against Great Northern.
B. Issues on Appeal
On appeal, Great Northern argues that the trial court erred in (1) excluding evidence of an alleged assignment of Stephens' interest in the promissory note, (2) in granting the above-mentioned directed verdicts against Great Northern in favor of Circle Ridge, (3) in failing to grant a directed verdict in favor of Great Northern on its wrongful foreclosure claim against Circle Ridge, (4) in awarding $637,114.15 to Circle Ridge for breach of the promissory note, (5) in quieting title in favor of Circle Ridge, (6) in permitting opposing counsel to make certain comments during voir dire and closing argument, (7) in submitting the wrongful foreclosure questions to the jury, (8) in failing to grant its motions for mistrial, (9) in denying motions for new trial and judgment notwithstanding the verdict, and (10) in awarding $150,873.37 in attorney's fees.
C. Resolution of Issues on Appeal
We affirm, in part, the trial court's judgment because we conclude that (1) the trial court did not abuse its discretion in making any of its evidentiary rulings related to the alleged assignment, (2) Great Northern did not preserve evidentiary challenges unrelated to the alleged assignment, (3) the motion for mistrial based on the trial court's evidentiary rulings was properly overruled, (4) Great Northern did not properly brief many of its challenges to the trial court's directed verdict ruling, (5) the properly briefed challenges to the trial court's directed verdict rulings are without merit, (6) the trial court's damage award was based on a stipulation by the parties, (7) the trial court properly quieted title in favor of Circle Ridge, (8) Great Northern failed to preserve complaints about (a) comments made during voir dire and closing argument, (b) challenges to the submitted jury charge, and (c) its appellate argument related to the trial court's denial of its motion for mistrial made during voir dire, and (9) the motions for new trial and judgment notwithstanding the verdict were properly denied. However, because attorney's fees were not properly segregated, we reverse the award of attorney's fees and remand the matter to the trial court for further proceedings consistent with this opinion.
II. Factual Background and Procedural History
Billy Joe Briscoe and Doug Friedel are the only two shareholders of Circle Ridge. On May 17, 2012, in exchange for $10,000.00, O'Benco III, LP, assigned its decimal working interests and decimal revenue interests in several oil and gas leases located in Harrison County, Texas, which the parties in this case collectively refer to as the O'Benco leases,
A. Circle Ridge and Stephens Sell Their Interests in the O'Benco Leases to Great Northern
Shortly after Circle Ridge and Stephens began production on wells located in the O'Benco leases, they received a call from Great Northern's President, Joe Loftis, who expressed an interest in acquiring their decimal working and revenue interests in the O'Benco leases. As consideration for Great Northern's execution and delivery of a $700,000.00 promissory note, a $180,000.00 cash payment to Circle Ridge, and a $20,000.00 cash payment to Stephens, Circle Ridge and Stephens assigned to Great Northern the interests they had acquired in the O'Benco leases, subject to certain reservations not relevant to the main issues in this case.
The assignment and bill of sale was executed by Circle Ridge and Stephens on September 11, 2012.
The promissory note was also executed on September 11, 2012, by Abercrombie. It provided that Great Northern would pay Circle Ridge and Stephens seventeen monthly installments of $38,000.00, plus an eighteenth installment of the remaining balance, beginning December 1, 2012, with each installment due on or before the first day of every month. The note also warned that a default in payment by Great Northern could result in the acceleration of the debt. The promissory note was secured by a document titled "DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF PRODUCTION, AND FINANCING STATEMENT OF OIL AND GAS PROPERTIES (INCLUDING AFTER ACQUIRED TITLE)," which we simply refer to as the deed of trust.
The deed of trust listed Dean A. Searle as the Trustee, and both "Circle Ridge Production, Inc. and Kevin Stephens" as the "Beneficiary [sic]," a fact which is critical to understanding the parties' arguments. The deed of trust, which also stated that Great Northern's default could result in the acceleration of the debt, provided, "Beneficiary shall have the right to assign all or a portion of its interest in this Deed of Trust to any subsequent holder of any portion of the Obligation." The deed of trust further specified that, in the event of default,
It is undisputed that Great Northern did not pay the promissory note as required and that its interests in the O'Benco leases were foreclosed upon.
B. The Rangeford Resources/Rojo Burro Transaction
Prior to the foreclosure, however, Stephens and Great Northern began investigating other business prospects involving the O'Benco leases. Great Northern proposed to include the O'Benco leases "in a package to be resold" to Rangeford Resources. In the fall of 2012, Great Northern discussed with Stephens the possibility of his participation in the sale of the O'Benco leases to Rangeford Resources. Briscoe testified that Stephens approached him to see if Circle Ridge would be willing to participate in the deal, but Circle Ridge declined. According to Stephens, he authorized his brother, Mike Stephens to look into the Rangeford Resources transaction.
As a result of negotiation with Great Northern, and in anticipation of Rangeford Resources' ultimate acquisition of the O'Benco leases, Stephens agreed to sell his undivided interest in the O'Benco leases to Great Northern in consideration for, among other things, Rangeford Resources stock. However, the Rangeford Resources transaction never materialized. At trial, the court excluded evidence of this transaction, including alleged assignments of interest in the O'Benco leases from Stephens to Great Northern arising out of the Rangeford Resources/Rojo Burro Transaction.
C. Great Northern's Interests Are Foreclosed After it Fails to Pay the Promissory Note
Great Northern failed to pay Circle Ridge and Stephens in a timely manner pursuant to the terms of the promissory note. According to Briscoe, Circle Ridge and Stevens gave Great Northern additional time to pay on two or three occasions, but eventually decided to proceed with foreclosure. Loftis testified that Great Northern had a good relationship with Stephens, who did not make a personal demand for payment on the promissory note after Great Northern failed to make timely payments. Yet, both Briscoe and Stephens testified that they each gave Searle permission to foreclose on Great Northern's interest in the O'Benco leases.
On August 2, 2013, Great Northern's attorney wrote to Searle proposing a solution to avoid the trustee's sale. The proposal stated that Great Northern would, among other things, pay $38,000.00 into Searle's trust account for Circle Ridge's benefit by August 5, 2013, and would pay all sums due and owing to Circle Ridge under the note by not later than September 15, 2013. On August 23, 2013, Searle responded by indicating that he would provide "a payoff statement for the Circle Ridge portion of the . . . note."
On October 11, 2013, Searle wrote to Great Northern "in connection with" Circle Ridge's "one-half (1/2) interest in a Promissory Note," advised Great Northern that the entire balance of the promissory note was accelerated, and provided notice of foreclosure of the entire interest. The letter informed Great Northern that it would be obligated to repay the indebtedness if the proceeds of the foreclosure sale were insufficient to pay the indebtedness and afforded it an opportunity to cure the delinquency. Although the letter did not make reference to Stephens or his portion of the indebtedness, it clarified that Searle would sell the property as trustee under the deed of trust in accordance with the terms of the deed of trust. The letter also informed Great Northern that it had the right to file suit if it believed that it was not in default, but Great Northern did not attempt to prevent the foreclosure.
Great Northern's interests were sold at public auction on November 5, 2013. Circle Ridge made a winning bid of $150,000.00 and, by way of a trustee's deed, obtained all of Great Northern's interest in the O'Benco leases. On December 13, 2013, Stephens officially filed an assignment of his interest in the promissory note to Circle Ridge. The evidence at trial established that Circle Ridge paid Stephens $200,000.00 in exchange for this transfer. Nevertheless, according to Briscoe, Great Northern continued its physical possession of the wells included in the O'Benco leases in spite of the foreclosure.
D. Two Lawsuits Are Consolidated
Great Northern sued Circle Ridge, Briscoe, and Stephens in the 116th Judicial District Court of Dallas County, Texas, asserting various causes of action. Subsequently, Circle Ridge sued Great Northern, Loftis, and Abercrombie in the 71st Judicial District Court of Harrison County, Texas, to quiet title to the interests in the O'Benco leases. On September 18, 2014, the 116th Judicial District Court of Dallas County granted a transfer of venue to Harrison County, and the cases were consolidated for trial.
In its live pleading, a third amended petition, Great Northern, Loftis, and Abercrombie argued that the December 13, 2013, assignment from Stephens to Circle Ridge was invalid because Stephens had purportedly executed another assignment to Great Northern on December 1, 2012, in exchange for valuable consideration. Great Northern also alleged that the foreclosure was invalid because the trustee, Dean Searle, purported to act on behalf of Stephens and Circle Ridge, but could not act on Stephens' behalf in light of the assignment of his interest to Great Northern. Great Northern also asserted (1) a cause of action against Stephens for breach of an agreement to deliver two pump jacks and 500 joints of 3½-inch tubing, (2) causes of action against Circle Ridge and Stephens for unjust enrichment and breach of an implied covenant of good faith and fair dealing for their failure to deliver "the bargained for rights to well bores and oil and gas lease interests," (3) causes of action against Circle Ridge and Stephens for negligent misrepresentation,
In response, Circle Ridge filed a trespass to try title claim. It argued that the purported assignment from Stephens to Great Northern filed in Harrison County was a forgery, that Stephens never signed the assignment because he did not receive the promised consideration for the assignment, and that any conveyances from Great Northern to others prior to the time Great Northern acquired any interest in the O'Benco leases were void. Circle Ridge also filed a breach of contract claim for Great Northern's failure to perform under the deed of trust and causes of action for civil conspiracy for the forgery. Circle Ridge also alleged spoliation of evidence and sought attorney's fees.
E. Exclusion of Evidence
During the jury trial, the court excluded evidence related to the Rangeford Resources/Rojo Burro transaction. Great Northern complained that the trial court's evidentiary rulings prevented it from effectively presenting its case. Specifically, Great Northern claims it was effectively prevented from arguing that Stephens had assigned any interest in either the O'Benco leases or the promissory note. We discuss a few key items at this juncture to give context to the parties' appellate arguments.
1. The Excluded Letter of Agreement
One of the documents excluded from evidence was entitled "LETTER OF AGREEMENT KEVIN AND MIKE STEPHENS INTEREST PURCHASE OBENCO AND ROJO BURRO, LLC." The Letter of Agreement, which Stephens' signed, provided that Stephens and Mike (1) "agree to sell [to Great Northern] any and all interests held or otherwise controlled by them in the leasehold commonly known as OBENCO . . . includ[ing] all interest in and to all debts payable to [Stephens or Mike] as of this date for which [Great Northern] is obligated,"
As consideration, Stephens was to receive $125,000.00, Mike was to receive $10,000.00, and both were to receive shares of Rangeford Resources stock. The body of the Letter of Agreement listed its effective date as December 1, 2013, instead of December 1, 2012.
2. The Excluded Note Assignment
Another document excluded from evidence was labeled "PURCHASE OR NOTE AND FINANCIAL INSTRUMENT KEVIN STEPHENS UNTO GREAT NORTHERN ENERGY, INC. OBENCO PROPERTIES" and was signed by Stephens on December 1, 2012 (Note Assignment). In the Note Assignment, Stephens gave to Great Northern all of his "right, title[,] and interests in and to that certain debt instrument wherein [Stephens was] a lender unto [Great Northern] under a note and according to the . . . stated terms and conditions."
3. The Filed Assignment that Was Not Offered Into Evidence
In its pleadings, Great Northern argued that Stephens executed an assignment on December 1, 2012, which it filed of record in Harrison County (Filed Assignment). Great Northern argues that by virtue of the Filed Assignment, Stephens, "individually, and as any portioned owner of Circle Ridge Production, Inc. if any," assigned "any and all right, title and interests" in the working interests in O'Benco leases. The Filed Assignment further stated,
The Filed Assignment was purportedly signed by "K Stephens, Individual." It was notarized by Abercrombie, but the acknowledgement stated, "I did witness one K Stephens sign this assignment after identifying him as one in the same as the person signing this document and entering his name in the notary register as required by state law."
The Filed Assignment was recorded on April 1, 2013. On February 4, 2014, Stephens, who owned no interest in Circle Ridge, executed an affidavit of forgery averring that he never signed the Filed Assignment. The Filed Assignment was never offered into evidence at trial.
F. The Result
In addition to excluding evidence of the Rangeford Resources/Rojo Burro transaction, the trial court entered directed verdicts on Great Northern's claims for unjust enrichment, breach of implied covenant of good faith and fair dealing, negligent misrepresentation, tortious interference, and fraud. The trial court also granted a motion for directed verdict in favor of Circle Ridge on its breach of contract claim after Great Northern's counsel (1) admitted that Great Northern was "a little behind" on payments under the promissory note, and (2) entered into the following stipulation: "that the amount of the note between Circle Ridge and Kevin Stephens as lender and Great Northern as borrower . . . [a]s of . . . 22
The trial court's directed verdicts left the jury to decide only the issue of wrongful foreclosure, namely whether Great Northern established that there was a defect in the foreclosure sale and whether Great Northern established that Circle Ridge paid a grossly inadequate sales price at the foreclosure sale. The jury returned a negative answer to both questions. By agreement, the issue of attorney's fees was tried to the court.
In its final judgment, the trial court recited the directed verdicts it had entered during trial which favored both Circle Ridge and Stephens, and it entered a take-nothing judgment against Great Northern. The judgment (1) declared that Great Northern had defaulted under the terms of the promissory note, (2) quieted title in Circle Ridge as a result of the trustee's sale,
From this judgment, Great Northern appeals.
G. Great Northern's Arguments on Appeal
Great Northern advances a total of fifty-three complaints grouped into eleven categories. Among these complaints, Great Northern argues that the trial court erred in excluding a majority of its evidence, improperly granted directed verdicts against it, erred in overruling its motions for mistrial and objections to voir dire and closing argument, failed to submit properly requested jury instructions, and erred in quieting title in Circle Ridge and awarding it attorney's fees.
III. The Trial Court Did Not Abuse its Discretion in Excluding Great Northern's Evidence
Great Northern first argues that the trial court abused its discretion in excluding documents and testimony related to the negotiation of the Rangeford Resources/Rojo Burro transaction and an alleged assignment made by Stephens as a result of those negotiations. Because we conclude that there was no evidence of any actual assignment by Stephens to Great Northern, we conclude that the trial court did not abuse its discretion in making its evidentiary rulings.
A. Standard of Review
"We review a trial court's evidentiary . . . rulings for abuse of discretion." Sw. Energy Prod. Co. v. Berry-Helfand, 491 S.W.3d 699, 727 (Tex. 2016) (citing JLG Trucking, LLC v. Garza, 466 S.W.3d 157, 161 (Tex. 2015) ("We review a trial court's exclusion of evidence for an abuse of discretion."). "A trial court abuses its discretion when it acts without regard for any guiding rules." Caffe Ribs, Inc. v. State, 487 S.W.3d 137, 142 (Tex. 2016) (citing Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex. 1985)).
We "must uphold the trial court's [decision to exclude evidence] if there is any legitimate basis for the ruling" or "if it is correct under any legal theory," "even if that ground was not raised in the trial court." Enbridge Pipelines (E. Tex.) L.P. v. Avinger Timber, LLC, 386 S.W.3d 256, 264 (Tex. 2012) (citing Owens-Corning Fiberglas Corp. v. Malone, 972 S.W.2d 35, 43 (Tex. 1998)); Columbia Med. Ctr. Subsidiary, L.P. v. Meier, 198 S.W.3d 408, 411 (Tex. App.-Dallas 2006, pet. denied); Barnhart v. Morales, 459 S.W.3d 733, 742 (Tex. App.-Houston [14th Dist.] 2015, no pet.) (citing Hooper v. Chittaluru, 222 S.W.3d 103, 107 (Tex. App.-Houston [14th Dist.] 2006, pet. denied) (op. on reh'g)); see Calhoun/Holiday Place, Inc. v. Wells Fargo Bank, N.A., No. 01-14-00872-CV, 2016 WL 3272216, at *4 (Tex. App.-Houston [1st Dist.] June 14, 2016, no pet.); In re Block Fin. Advisors, Inc., 262 S.W.3d 896, 899 (Tex. App.-Houston [14th Dist.] 2008, orig. proceeding) ("Because a trial court cannot abuse its discretion in reaching a correct result for the wrong reasons, we will uphold the trial court's order on any ground supported by the record."); Edgeworth v. Wilson, 113 S.W.3d 559, 562 (Tex. App.-Texarkana 2003, no pet.).
B. Preliminary Matters
1. The Promissory Note is Not a Negotiable Instrument
Great Northern argues that, because the promissory note was payable to Circle Ridge and Kevin Stephens, it was payable to all of them and could only be enforced by all of them. Although Stephens testified that he gave permission to Searle to foreclose, Great Northern argues that Stephens had assigned his one-half undivided interest in the promissory note to Great Northern and that Great Northern did not provide permission for the foreclosure. Great Northern further argues that, since the foreclosure was made pursuant to the deed of trust, of which Circle Ridge and Stephens were joint beneficiaries, the foreclosure was wrongful, or, in the alternative, resulted in foreclosure of only Circle Ridge's one-half undivided interest in the O'Benco leases.
Great Northern cites to Section 3.110 of the Business and Commerce Code in support of this argument.
TEX. BUS. & COM. CODE ANN. § 3.110(d) (West 2002).
"The negotiability of an instrument is a question of law." Guniganti v. Kalvakuntla, 346 S.W.3d 242, 248 (Tex. App.-Houston [14th Dist.] 2011, no pet.) (citing FFP Mktg. Co. v. Long Lane Master Trust IV, 169 S.W.3d 402, 407 (Tex. App.-Fort Worth 2005, no pet.)). Chapter 3 of the Business and Commerce Code only "applies to negotiable instruments." TEX. BUS. & COM. CODE ANN. § 3.102 (West 2002). Under Chapter 3,
TEX. BUS. & COM. CODE ANN. § 3.104(a)(3) (West Supp. 2016). While promissory notes can be and are often referred to as negotiable instruments, they can only be negotiable instruments under Chapter 3 if they constitute "an unconditional promise or order to pay a fixed amount of money." Id. Whether an instrument meets this standard is governed by Section 3.106, titled "Unconditional Promise or Order." TEX. BUS. & COM. CODE ANN. § 3.106 (West Supp. 2016).
Section 3.106 states that "a promise or order is unconditional unless it states (i) an express condition to payment, (ii) that the promise or order is subject to or governed by another record, or (iii) that rights or obligations with respect to the promise or order are stated in another record." TEX. BUS. & COM. CODE ANN. § 3.106(a). Comment 1 to Section 3.106 explains,
TEX. BUS. & COM. CODE ANN. § 3.106 cmt. 1 (West 2002).
A review of the promissory note in this case establishes that it does not meet the criteria of Section 3.106. The promissory note states,
Because the promissory note contains statements such as the ones specified under Comment 1 to Section 3.106, the promissory note is not a negotiable instrument under Section 3.104.
The promissory note provided that a default in payment by Great Northern could result in the acceleration of the entire debt, and the deed of trust allowed the trustee to foreclose and sell "all or any part of the Mortgaged Property . . . as an entirety." According to the provisions of the deed of trust, Great Northern's obligation was secured by property as described by these terms of the deed of trust:
Exhibit A to the deed of trust described various properties, including the O'Benco leases which were the subject of the assignment of sale from Circle Ridge and Stephens to Great Northern. Thus, the foreclosure of all of Great Northern's interest in the O'Benco leases was contemplated by agreement of the parties.
However, Great Northern contends that the foreclosure was wrongful because it acquired Stephens' interest in the promissory note. We now address whether there was any evidence that Stephens actually assigned his interest in the promissory note.
2. There Was no Assignment from Stephens to Great Northern
We have previously explained that the Filed Assignment was never offered into evidence. Thus, we must determine whether the Letter of Agreement or Note Assignment constituted an actual assignment of Stephens' interest in either the note or the O'Benco leases.
The Letter of Agreement, filed as a part of Great Northern's offer of proof, stated that Stephens agreed to sell, effective as of December 1, 2013, his interests in both the O'Benco leases and the promissory note and that his rights and interests in both would be transferred to Great Northern "on closing of this transaction." The Letter of Agreement recited cash payments and payment of Rangeford Resources stock as consideration. The Note Agreement stated that Stephens would, "effective December 1st, 2013, sell and grant his undivided portion" of the promissory note and provided that Great Northern would assume Stephens' role under the promissory note "in all forms and under all terms therein and as of closing this agreement shall have the rights of the contracts, notes[,] and other instruments." By their plain terms, both documents, which contemplated a closing, constituted agreements to sell, transfer, and convey at a future closing.
"An assignment is to be distinguished from a promise." 4 ARTHUR L. CORBIN, Corbin on Contracts § 879 at 530 (1951). "The former is a transfer or conveyance of a right against some third party . . . A promise, on the other hand, is an expression of intention by the promisor to render some performance in the future." Id. "A contract to make a future assignment of a right, or to transfer proceeds to be received in the future by the promisor, is not an assignment." RESTATEMENT (SECOND) OF CONTRACTS § 330 (1981). "As to a right in existence, it is a question of interpretation whether the obligee manifests an intention to make a present transfer or only an intention to bind himself to make a future transfer." Id. cmt.
The Letter of Agreement and Note Agreement both contemplated a closing, and at trial, it was undisputed that the Rangeford Resources transaction did not close and that Stephens never received Rangeford Resources stock, which was consideration for the agreement.
Furthermore, at trial, Great Northern conceded that Stephens had not assigned any interest in the O'Benco Leases, essentially admitting that the Letter of Assignment was not an actual assignment. Instead, it relied only on the Note Assignment, claiming that Stephens had only assigned an interest in the promissory note. During an offer of proof, Stephens explained, "I was going to participate with [Great Northern], pose a deal that was going to happen with Rangeford Resources that never materialized." Briscoe also testified that he did not hear from Stephens about any alleged assignment by him prior to the foreclosure, and, during an offer of proof, Loftis admitted that Stephens had not received any of Rangeford Resources stock that was pledged as consideration for the Letter Agreement and Note Assignment.
Because there was no evidence of an actual assignment offered at trial, there was no evidence that Stephens transferred either his interest in the promissory note or his interests in the O'Benco leases.
C. The Trial Court Did Not Abuse its Discretion in Excluding Evidence Relating to the Rangeford Resources/Rojo Burro Transaction or an Alleged Assignment
In order for Great Northern to prevail on its evidentiary complaints, it must demonstrate that the excluded evidence was relevant. Circle Ridge argues that Great Northern's evidence "was properly excluded as irrelevant . . . because there was no evidence of any" actual assignment. We agree.
"Evidence is relevant if: (a) it has any tendency to make a fact more or less probable than it would be without the evidence; and (b) the fact is of consequence in determining the action." TEX. R. EVID. 401. Here, all of the excluded exhibits and testimony referenced an assignment that Stephens was to make on the closing of the Rangeford Resources/Rojo Burro transaction. That transaction never closed, and no evidence that Stephens actually assigned his interest to Great Northern was offered at trial. In the absence of evidence of an actual assignment by Stephens, we cannot find that the trial court abused its discretion in concluding that evidence of the Rangeford Resources/Rojo Burro negotiations and documentation contemplating a future assignment were irrelevant to the causes of action asserted in the parties' live pleadings or the parties' defenses. Thus, we overrule Great Northern's point of error related to the trial court's exclusion of this evidence.
D. Great Northern Did Not Preserve Error on Exclusion of Evidence Not Related to an Alleged Assignment
Nathanial Moran represented Great Northern in connection with its dispute regarding money due to Circle Ridge under the promissory note. After Circle Ridge and Stephens passed Moran as a witness, Great Northern asked the trial court if it could ask him a question outside of the jury's presence. The trial court agreed, and Great Northern questioned Moran during an offer of proof. Moran testified that he believed Searle only represented Circle Ridge during the foreclosure proceedings. After Moran was questioned, Great Northern passed him as a witness, but did not seek to admit his testimony and did not ask the trial court to rule on whether his testimony was admissible.
"To preserve error concerning the exclusion of evidence, the complaining party must actually offer the evidence and secure an adverse ruling from the court." In re R.N., 356 S.W.3d 568, 572 (Tex. App.-Texarkana 2011, no pet.) (quoting Lister v. Walters, 247 S.W.3d 381, 383 n.1 (Tex. App.-Texarkana 2008, no pet.)). In R.N., we explained that counsel must offer the testimony of a witness obtained during an offer of proof in order to preserve error. Id. As in R.N., "although the record of the intended testimony was made, no request was made of the court to allow the introduction of that testimony. The trial court did not rule on the admissibility of the testimony because it had not been offered." Id. Thus, because the trial court did not rule "`on the request, objection, or motion, either expressly or implicitly,' or did not refuse `to rule on the request, objection, or motion,'" Great Northern failed to preserve the issue of alleged error in the failure to admit Moran's testimony.
Similarly, Great Northern also failed to preserve its point of error that the trial court erred in excluding Mike's testimony "regarding the financial and business relationship between Kevin Stephens and Chad Hamilton" and testimony regarding Stephens' "role in the disappearance of equipment sold to Great Northern for use on the leases." The testimony was obtained by an offer of proof, after which Great Northern "passed the witness" and did not request the trial court to include any of the testimony. Accordingly, the trial court did not rule on the admissibility of this testimony, and any error on this point is not preserved.
IV. The Trial Court's Directed Verdicts
A. Directed Verdicts on Great Northern's Claims Were Proper
1. Standard of Review
In reviewing the trial court's directed verdicts on issues in which Great Northern had the burden of proof at trial, "we decide whether there is any evidence of probative value to raise an issue of material fact on the question presented, and we review the evidence in the light most favorable to the person suffering the adverse judgment." Exxon Corp. v. Emerald Oil & Gas Co., L.C., 348 S.W.3d 194, 220 (Tex. 2011); Szczepanik v. First S. Trust Co., 883 S.W.2d 648, 649 (Tex. 1994) (per curiam). The presence of some evidence "will defeat the directed verdict." Exxon, 348 S.W.3d at 220. The Texas Supreme Court has observed a directed verdict may be proper in two situations: (1) "when a plaintiff fails to present evidence raising a fact issue essential to the plaintiff's right of recovery" and (2) "if the plaintiff admits or the evidence conclusively establishes a defense to the plaintiff's cause of action." Prudential Ins. Co. of Am. v. Fin. Review Servs., Inc., 29 S.W.3d 74, 77 (Tex. 2000).
A "no evidence" point will be sustained only if there is a complete absence of evidence establishing a vital fact, the only evidence offered to prove a vital fact cannot be considered due to a rule of law or evidence, there is less than a scintilla of evidence to prove the vital fact, or the opposite of the vital fact is conclusively established. Jelinek v. Casas, 328 S.W.3d 526, 532 (Tex. 2010). More than a scintilla of evidence exists when the evidence permits the conclusion of reasonable and fair-minded people to differ. Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997). "Less than a scintilla of evidence exists when the evidence is `so weak as to do no more than create a mere surmise or suspicion' of a fact." King Ranch, Inc. v. Chapman, 118 S.W.3d 742, 751 (Tex. 2003) (quoting Kindred v. Con/Chem, Inc., 650 S.W.2d 61, 63 (Tex. 1983)). In our review, we credit favorable evidence if a reasonable fact-finder could do so and disregard contrary evidence unless a reasonable fact-finder could not. City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005).
2. The Trial Court Properly Directed Verdict Against Great Northern on its Breach of Contract Claim Against Stephens
During the December 2012 through January 2013 time frame, Great Northern used Stephens' assistance to obtain production equipment. According to Loftis' testimony, Stephens would transfer Great Northern's requests for equipment to Chad Hamilton, who would provide the equipment. On presentment of a bill by Hamilton, Great Northern would pay. Great Northern allegedly ordered and paid for pump jacks and pipes from Hamilton, which were never delivered.
In its pleadings, Great Northern asserted a breach of contract action against Stephens for failure to provide the pump jacks and pipes as agreed on. In order to establish that Stephens breached a contract, Great Northern was required to put forth evidence demonstrating that it had a contract with Stephens in which Stephens agreed to provide pump jacks and pipes.
In an offer of proof, Great Northern included (1) a document appearing to be an order placed with Hamilton on January 24, 2013, for twenty-five "pumping units," for a total price of $12,000.00, with the notation, "Did we pay?"; (2) an order with Hamilton for $35,000.00 worth of tubing; (3) a document showing that Great Northern paid Hamilton two "Pumper Charge[s]"; and (4) checks written by Great Northern to Hamilton, allegedly for the equipment ordered by it. Omitted from the documentary offer was anything tying Stephens to the promise to provide pump jacks and pipes.
In fact, Loftis indicated that Stephens was acting on Great Northern's behalf in relaying its need to Hamilton. According to Loftis, Stephens said he was receiving a commission on the equipment sales.
On its breach of contract claim, Great Northern was required to bring forth more than a scintilla of evidence showing that it had a contract with Stephens to provide pipes and pump jacks and that Stephens breached that agreement. See Werline v. E. Tex. Salt Water Disposal Co., 209 S.W.3d 888, 898 (Tex. App.-Texarkana 2006), aff'd, 307 S.W.3d 267 (Tex. 2010). However, even in reviewing the evidence in the light most favorable to Great Northern, nothing demonstrated that Stephens was anything other than an intermediary. Instead, the evidence showed only that Great Northern's contract with respect to provision of the pump jacks and pipes was with Hamilton, not Stephens. Accordingly, because there was no evidence of a contract showing that Stephens, individually, was under an obligation to provide pipes and pump jacks, the trial court properly granted his motion for directed verdict on Great Northern's breach of contract claim.
3. Any Complaint Regarding the Directed Verdict Against Great Northern on its Claims for Breach of the Implied Covenant of Good Faith and Fair Dealing is Not Properly Briefed
In its pleadings, Great Northern asserted a cause of action against Circle Ridge and Stephens for breach of the implied covenant of good faith and fair dealing because (1) they "had an agreement with [Circle Ridge and Stephens] wherein [Great Northern] bargained for rights in the OBENCO Leases," (2) "[p]ursuant to this agreement[,] the Defendants were required to act in good faith," (3) Great Northern "had a justified expectation that [Circle Ridge and Stephens] would act in a reasonable manner in providing [them] with the bargained for rights to well bores and oil and gas lease interests," (4) Circle Ridge and Stephens "failed to provide [Great Northern] with the bargained for rights," and (5) their conduct resulted in a breach of the implied covenant of good faith and fair dealing and damaged Great Northern. The trial court directed a verdict against Great Northern on this claim.
The Supreme Court of Texas has not recognized an implied covenant of good faith and fair dealing, under which every contract gives rise to a separate duty in tort, although it has acknowledged that a duty may arise "as a result of a special relationship between the parties governed or created by a contract." Arnold v. Nat'l Cty. Mut. Fire Ins. Co., 725 S.W.2d 165, 167 (Tex. 1987). In its briefing, Great Northern recites this law, but the only analysis offered on whether the trial court erred in directing a verdict against Great Northern on this claim is as follows:
We find that Great Northern has not provided this Court with "a clear and concise argument for the contention made, with appropriate citations to authorities" in support of its argument. TEX. R. APP. P. 38.1(i).
B. Directed Verdict on Claims Against Great Northern/the Damage Award
Great Northern argues that the trial court erred in directing a verdict on Circle Ridge's breach of contract claim. The elements of a claim for breach of contract are (a) a valid, enforceable contract, (b) performance under the contract by the claimant, (c) breach by the defendant, and (d) an injury to the claimant caused by the breach. Werline, 209 S.W.3d at 898. Circle Ridge moved for a directed verdict on its breach of contract action, which was based on Great Northern's failure to pay the promissory note. The trial court directed a verdict on this issue, and Great Northern complains. Where "a party moves for a directed verdict on an issue on which he bore the burden of proof, he must demonstrate that he conclusively proved all facts necessary to establish his right to the requested verdict." Nat'l City Bank of Indiana v. Ortiz, 401 S.W.3d 867, 885 (Tex. App.-Houston [14th Dist.] 2013, pet. denied).
At trial, it was undisputed that the promissory note was a valid, enforceable contract and that Great Northern failed to pay the promissory note according to the note's terms. Circle Ridge also established that it had completed its performance under the contract and that it was damaged by Great Northern's failure to pay. Before the trial court directed a verdict on Circle Ridge's breach of contract claim, Great Northern admitted its failure to pay and had stipulated that, if Stephens had not made any assignment under the note, it owed Circle Ridge $637,114.15.
Yet, on appeal, Great Northern challenges the trial court's ruling solely on the basis that Briscoe could not act alone, without Stephens, in enforcing the promissory note.
We conclude that the trial court's directed verdict on Circle Ridge's breach of contract claim and its damage award, based on the stipulation of the parties, were both proper.
V. The Trial Court Properly Entered Judgment for Circle Ridge On Its Trespass to Try Title Claim
Trespass to try title is the sole method to determine title to land or real property in cases where there is no boundary dispute. Martin v. Amerman, 133 S.W.3d 262, 267 (Tex. 2004), overruled on other grounds by TEX. CIV. PRAC. & REM. CODE ANN. § 37.004(c) (West 2015) (providing declaratory relief in boundary disputes where the placement of the boundary is also determinative of the issue of title); Berg v. Wilson, 353 S.W.3d 166, 180 (Tex. App.-Texarkana 2011, pet. denied). In a trespass to try title suit, "it is `incumbent on the plaintiff to discharge the burden of proof resting on him to establish superior title.'" Tipps v. Chinn Expl. Co., No. 06-13-00033-CV, 2014 WL 4377813, at *5 (Tex. App.-Texarkana Sept. 5, 2014, pet. denied) (mem. op.) (quoting Davis v. Gale, 330 S.W.2d 610, 612 (Tex. 1960)). Great Northern argues that Circle Ridge did not meet its burden of proof. We disagree.
A. Standard of Review
"In reviewing a legal sufficiency complaint of an adverse finding on which the appellant did not have the burden of proof, the appellant must demonstrate on appeal that no evidence supports the adverse finding." Monasco v. Gilmer Boating & Fishing Club, 339 S.W.3d 828, 830 (Tex. App.-Texarkana 2011, no pet.) (citing Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983); Cendant Mobility Servs. Corp. v. Falconer, 135 S.W.3d 349, 352 (Tex. App.-Texarkana 2004, no pet.)). As we stated in Monasco,
Id. (citing Merrell Dow Pharms. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997)). "If the evidence furnishes some reasonable basis for differing conclusions by reasonable minds about a vital fact's existence, more than a scintilla of evidence exists." Id. (citing Burroughs Wellcome v. Crye, 907 S.W.2d 497, 499 (Tex. 1995)).
"When challenging the factual sufficiency of the evidence supporting an adverse finding on which the appealing party did not have the burden of proof, the appellant must demonstrate that there is insufficient evidence to support the adverse finding." Id. "The evidence is sufficient to support the adverse finding if the evidence is such that reasonable minds could differ on the meaning of the evidence, or the inferences and conclusions to be drawn from the evidence." Id. at 830-31. "A challenge to the factual sufficiency of the evidence will be sustained if the evidence is so weak or the verdict is so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust." Id. at 831 (citing Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986)).
"To maintain an action of trespass to try title, the person bringing the suit must have title to the land sought to be recovered." Tipps, 2014 WL 4377813, at *5 (quoting Ramsey v. Grizzle, 313 S.W.3d 498, 505 (Tex. App.-Texarkana 2010, no pet.)). "A plaintiff[`]s right to recover depends on the strength of his or her own title, not the weaknesses of the title of his or her adversary." Id. (quoting Ramsey, 313 S.W.3d at 505). "A plaintiff is not entitled to recover unless the plaintiff's own title is effectively disclosed." Id. "On the failure of a plaintiff to establish superior title in a trespass to try title suit, the proper course of action is for the trial court to enter a take-nothing judgment." Id.
"Recovery can be based on proof of (a) title through regular chain of conveyances from the sovereign, (b) superior title out of a common source, (c) title by limitations, or (d) unabandoned prior possession of the land." Id. (citing Plumb v. Stuessy, 617 S.W.2d 667 (Tex. 1981)); Session v. Woods, 206 S.W.3d 772, 779 n.2 (Tex. App.-Texarkana 2006, pet. denied)). Here, Great Northern asserts superior title out of a common source. "Generally by this means, [Circle Ridge], as the plaintiff, may prove a prima facie case by connecting its title and [Great Northern]'s title through complete chains of title to the common source and then by showing that its[—Circle Ridge's—]title is superior." Rogers v. Ricane Enters., Inc., 884 S.W.2d 763, 768 (Tex. 1994).
In this case, however, Great Northern has asserted that its title derives from the same source as Circle Ridge's title. Rule 798 of the Texas Rules of Civil Procedure provides that "[i]t shall not be necessary for the plaintiff to deraign title beyond a common source." TEX. R. CIV. P. 798. In other words, Circle Ridge established, by certified copies of deeds that were introduced into evidence, that Great Northern acquired title for its interests in the O'Benco leases from Circle Ridge and Stephens, who had acquired the same interests from O'Benco III, LP. Thus, Circle Ridge "need only demonstrate good title coming from that common source to meet its burden of proof." Rogers, 884 S.W.2d at 768.
We find that Circle Ridge established this objective by demonstrating that it obtained title via the trustee's deed following the foreclosure, which the jury concluded was not wrongfully accomplished.
Also, the Deed of trust states,
In light of these documents, we conclude that legally and factually sufficient evidence supports the trial court's decision to quiet title in favor of Circle Ridge against Great Northern. Accordingly, we overrule this point of error.
VI. Unpreserved Points
A. Great Northern Did Not Preserve Complaints on Appeal Related to Voir Dire
Great Northern argues that the trial court erred in overruling its objections during voir dire because it allowed Stephens to use the veniremembers as experts in violation of Rules 701-706 of the Texas Rules of Evidence and interjected "improper evidentiary matters into the trial." Specifically, Great Northern argues that counsel's discussion with veniremember number 217 bolstered Stephens' case on the improper notarization of documents by Abercrombie and that his conversation with Williams was aimed at obtaining expert testimony about wells in the Waskom area and their productivity, and discrediting Loftis.
1. Great Northern's Complaint Regarding Veniremember Number 217 is Not Preserved
Veniremember number 217 is an attorney. During voir dire, Stephens' counsel asked her why documents are notarized. Veniremember number 217 responded that documents are notarized "to legitimize the person, that that's who actually signed the document." After veniremember number 217 gave this answer, Great Northern approached the bench and argued that Stephens was "not asking the proper factual question to the jury . . . [and was] trying to bolster his case." Stephens' counsel responded, "Judge, I haven't talked about a single fact of this case," Great Northern replied, "That is where he's going," and the trial court simply stated, "I have to wait to see."
The trial court did not rule on the objections lodged by Great Northern at that juncture, and there was no request to strike venireperson number 217's previous answer. Then, the following discussion occurred:
Great Northern did not object to venireperson number 217's testimony while venireperson number 217 answered Stephens' questions. Instead, Great Northern asked to approach the bench after the above-referenced discussion. At that point, however, Great Northern only objected that venireperson number 217's answer "invade[d] the province of the Court" because "the lady just told them what the law is. That's a function of the court." The trial court overruled Great Northern's objection after Stephens responded that venireperson number 217 was "talking about her office." Again, without objection, Stephens continued the discussion with venireperson number 217:
On appeal, Great Northern does not argue that the trial court erred in overruling his objection that venireperson number 217's testimony invaded the province of the trial court. Instead, Great Northern only argues the issue of bolstering. In order to preserve error on this point, Great Northern is required to demonstrate that it either obtained a ruling on the issue of bolstering or that the trial court refused to rule on the matter after Great Northern objected to the trial court's refusal to rule. TEX. R. APP. P. 33.1(a)(2); see Babcock v. Nw. Mem'l Hosp., 767 S.W.2d 705, 708 (Tex. 1989).
Here, the record establishes that Great Northern did not obtain a ruling from the trial court on the issue of bolstering. Although it secured a ruling that venireperson number 217's testimony invaded the province of the court, "a party's complaint on appeal must comport with the objection made at trial." Lee v. Holoubek, No. 06-15-00041-CV, 2016 WL 2609294, at *5 (Tex. App.-Texarkana May 6, 2016, no pet.) (mem. op.); see Schwartz v. Forest Pharm., Inc., 127 S.W.3d 118, 125 (Tex. App.-Houston [1st Dist.] 2003, pet. denied). We find that Great Northern did not preserve its complaint that venireperson number 217's answers during voir dire were used to bolster Stephens' case. Accordingly, this point is overruled.
2. Great Northern's Complaint Regarding Veniremember Number 280 is Not Preserved
Another veniremember, number 280, was from the Waskom area and informed the panel that he "pull[ed] . . . workover rig[s]" and was familiar with the wells located on the O'Benco leases. Stephens asked veniremember number 280, "Do you have any knowledge about how good those wells are, the production?" veniremember number 280 responded, "Shallow wells, you know, they're not that—to me, they're not." There was no objection to this answer or to veniremember number 280's subsequent clarification that the wells on the O'Benco leases were on the lower end of the production side.
However, when Stephens asked veniremember number 280 if he knew whether the wells were on "the one-barrel-a-day-side," counsel approached the bench and argued, "[Stephens] is attempting to elicit factual information from a juror. That's designed to prejudice this jury . . . and that's improper. The evidence will come from the witness stand and not from a prospective juror." In response, Stephens stated that he was only attempting to determine whether he wanted to keep veniremember number 280 on the panel. The trial court ruled by stating, "I don't see it as a commitment question yet . . . so I'm going to overrule the objection." Great Northern immediately asked for and was denied a mistrial, although it provided no further argument on or clarification of its objections to Stephens' voir dire questions. From that point, Stephens' discussion with veniremember number 280 occurred without objection.
To preserve a complaint for appeal, a party must lodge a timely objection that states "the grounds for the ruling that the complaining party [seeks] from the trial court with sufficient specificity to make the trial court aware of the complaint, unless the specific grounds [are] apparent from the context," and obtain an adverse ruling on the issue complained of on appeal. See TEX. R. APP. P. 33.1(a)(1)(A). On appeal, Great Northern argues that the trial court allowed Stephens to use veniremember number 280 as an expert witness in violation of Rules 701 through 706 of the Texas Rules of Evidence. Nothing in the record indicates that Great Northern objected on the basis of Stephens attempting to interject expert evidence, and the record establishes that the trial court did not understand that any such objection was made. Because Great Northern did not raise the issue on appeal before the trial court, error is not preserved for our review. See id.; Petrohawk Props., L.P. v. Jones, 455 S.W.3d 753, 782 (Tex. App.-Texarkana 2015, pet. dism'd).
B. Jury Submissions
Great Northern asserted a cause of action against Circle Ridge for wrongful foreclosure. The trial court submitted the matter to the jury. On appeal, Great Northern argues that the trial court erred in the manner that it submitted the wrongful foreclosure issue to the jury because that "improperly shifted the burden of proof to Great Northern." On the record, however, Great Northern only complained of the denial of its requested jury instructions, but stated affirmatively that it had no objections to the trial court's submitted jury charge, including the wrongful foreclosure questions and instructions. Thus, it failed to preserve this issue for our review. TEX. R. APP. P. 33.1(a)(1)(A); see Burbage v. Burbage, 447 S.W.3d 249, 256 (Tex. 2014) (citing Thota v. Young, 366 S.W.3d 678, 691 (Tex. 2012)); In re D.G., No. 06-15-00025-CV, 2015 WL 6520251, at *12 (Tex. App.-Texarkana Oct. 28, 2015, pet. denied) (mem. op.).
C. Jury Argument
Great Northern argues that the trial court erred in "permit[ing] the counsel for Circle Ridge to argue before the jury that Great Northern had stipulated that it owed $637,114.15." Circle Ridge contends that Great Northern failed to preserve the issue for our review. We agree.
Outside of the presence of the jury, Great Northern agreed that $637,114.15 was "what the balance would be if there [was] no proper purchase." On appeal, Great Northern complains that Circle Ridge "improperly argued to the jury that Great Northern ha[d] stipulated it owed the sum" without the qualification. During closing arguments, Circle Ridge informed the jury that Great Northern "stipulated that as of today, as we sit here, there are $637,114.15 still owed under this [promissory note]." Circle Ridge did not object to this closing argument. Thus, Great Northern has not preserved this point of error for our review. See TEX. R. APP. P. 33.1.
VII. Motion for Judgment Notwithstanding the Verdict Was Properly Overruled
Great Northern filed a timely motion for judgment notwithstanding the verdict, which the trial court did not grant. On appeal, Great Northern raises the following issue:
Though the summary of this point of error is confusing, the substance of Great Northern's point of error argues that judgment notwithstanding the verdict was required on the jury's answers with respect to the wrongful foreclosure claims because Circle Ridge could not proceed to foreclosure without Stephens' participation.
"The standard of review for a trial court's denial of a motion for judgment notwithstanding the verdict is to determine whether the evidence conclusively proves a fact that establishes a party's right to a judgment as a matter of law." Isaacs v. Bishop, 249 S.W.3d 100, 106 n.4 (Tex. App.-Texarkana 2008, pet. denied) (citing Fort Bend Cty. Drainage Dist. v. Sbrusch, 818 S.W.2d 392, 394 (Tex. 1991)). "If so, then the trial court erred in denying the motion for judgment notwithstanding the verdict." Id.
On review, we consider the evidence and inferences tending to support the trial court's decision and disregard evidence and inferences to the contrary. Id. (citing Minyard Food Stores, Inc. v. Goodman, 80 S.W.3d 573, 577 (Tex. 2002)). "Judgment without or against a jury verdict is proper at any course of the proceedings only when the law does not allow reasonable jurors to decide otherwise." Id. "Accordingly, the test for legal sufficiency is the same for directed verdicts and judgments notwithstanding the verdict." Id. (citing City of Keller v. Wilson, 168 S.W.3d 802, 823 (Tex. 2005)). "We view the evidence in the light most favorable to the verdict, crediting favorable evidence if reasonable jurors could, and disregarding contrary evidence unless reasonable jurors could not." Id. "We are not a fact-finder and may not pass on the credibility of the witnesses or substitute its judgment for that of the trier of fact." Id.
In order to meet its burden of proof on the wrongful foreclosure claim, Great Northern was required to demonstrate a defect in the foreclosure proceedings. It attempted to do so by arguing that Stephens did not participate in the foreclosure. To support this claim, Great Northern offered Mike's testimony. Mike testified that he would have known if Stephens had made demand for payment under the promissory note from Great Northern. According to Mike, Stephens did not give Circle Ridge permission to act on his behalf in enforcing the note. Yet, both Briscoe and Stephens testified that Stephens gave Searle permission to foreclose. Thus, the jury was faced with conflicting evidence on whether Stephens "request[ed] [the] Trustee to proceed with foreclosure" under the deed of trust. The jury resolved this conflict in Circle Ridge's favor after hearing that Mike regularly stayed at Loftis' home, that he had stayed at Loftis' home after the first day of trial, that Loftis had purchased a business partly owned by Mike, and that Loftis and Mike were trying to start a new business together.
Because the jury was presented with conflicting evidence on whether Circle Ridge acted alone in the foreclosure proceedings and resolved that matter in Circle Ridge's favor, we conclude that the trial court did not err in overruling Great Northern's motion for judgment notwithstanding the verdict. Accordingly, we overrule this point of error.
VIII. Remand is Required to Determine the Proper Amount of Attorney's Fees
Before the case was submitted to the jury, both parties agreed to submit the issue of attorney's fees to the trial court. After reviewing Circle Ridge's motion for attorney's fees and costs and the supporting documentation attached thereto, the trial court awarded $150,873.37 in attorney's fees to Circle Ridge.
Great Northern argues that the trial court erred in making this award of attorney's fees because, under Section 3.110, Circle Ridge and Stephens could only enforce the promissory note together, if the promissory note was a negotiable instrument. It also argues that, to the extent efforts to collect attorney's fees were made pursuant to the deed of trust, the award was improper since Circle Ridge and Stephens did not engage in the foreclosure jointly. We will not disturb the award of attorney's fees absent an abuse of discretion. Musgrave v. Brookhaven Lake Prop. Owners Ass'n, 990 S.W.2d 386, 401 (Tex. App.-Texarkana 1999, pet. denied).
We have explained that Section 3.110 does not apply to the promissory note because it is not a negotiable instrument, that this case is governed by contract law, that the trial court properly directed a verdict on Circle Ridge's breach of contract claim for breach of the promissory note, of the note or face acceleration of the entire debt and foreclosure of their entire interests in the O'Benco leases, (3) the deed of trust provided that Searle could foreclose on all of Great Northern's interests in the O'Benco leases, and (4) Stephens gave Searle permission to proceed with foreclosure, which "expressly authorized and empowered" Searle "to sell all . . . of the Mortgage Property" which secured the debt. and that there was evidence that Stephens requested Searle to foreclose, as contemplated by the deed of trust. The promissory note provided,
Likewise, the deed of trust provided that Great Northern would pay "all costs and expenses incurred by Beneficiary, including without limitation, all legal . . . fees, made and incurred in connection with [the promissory note] . . . or in connection with the . . . perfection, realization, . . . or preservation of the security." Circle Ridge argues that these provisions of the promissory note and deed of trust required mandatory payment of attorney's fees. Alternatively, it argues that a party may recover attorney's fees for breach of contract. TEX. CIV. PRAC. & REM. CODE ANN. § 38.001 (West 2015). Pursuant to the terms of the promissory note and deed of trust, we conclude that the trial court did not abuse its discretion in awarding attorney's fees for Circle Ridge's breach of contract or for fees associated with the foreclosure.
However, Great Northern also argues that the affidavit of Ronan Searle, one of Circle Ridge's attorneys, was deficient in the following respects: (1) claims were not properly identified and segregated, (2) the billing statements included work completed on forgery, negligence, civil conspiracy, and Texas Civil Theft Liability claims, (3) counsel's affidavit, which incorporated "the contemporaneous billing records of the firm Searle and Searle," included work completed by Dean Searle, without a separate affidavit from Dean averring that the services were reasonable and necessary, and (4) bills submitted by two law firms were "so insufficient that it [was] impossible to determine what duplication occurred." We agree that attorney's fees were not properly segregated.
In its motion for attorney's fees, Circle Ridge stated generally that (1) Searle & Searle, PC, expended fifty-four hours in its pre-suit collection attempts, at the rate of $275.00 per hour, through the foreclosure; (2) Searle & Searle, PC, worked a total of 389.5 hours at the rate of $275.00 per hour to defend the suit filed by Great Northern in Dallas, to secure the transfer to Harrison County, and to litigate the consolidated lawsuits; and (3) the Runyan Law Firm, PC, expended 105 hours through trial, also at the rate of $275.00 per hour. The motion attached Ronan's affidavit and the affidavit of Michael Runyan, both of which restated the number of hours worked at the hourly rate of $275.00. The motion also attached billing records that contained general descriptions of the work performed, but did not segregate work performed for causes of action under which attorney's fees would not be recoverable.
In Tony Gullo Motors I, L.P. v. Chapa, the Texas Supreme Court "reaffirm[ed] the rule that if any attorney's fees relate solely to a claim for which such fees are unrecoverable, a claimant must segregate recoverable from unrecoverable fees." Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 313 (Tex. 2006). It further stated that "[i]ntertwined facts do not make tort fees recoverable; it is only when discrete legal services advance both a recoverable and unrecoverable claim that they are so intertwined that they need not be segregated." Id. at 313-14. "[T]he need to segregate fees is a question of law," but "the fees necessary to prove particular claims often turn on . . . facts." Id. at 312.
Circle Ridge asserted tort causes of action, including negligence in forging documents, negligence in attempting to assign interests to third parties, and civil conspiracy for forgery.
We remand the matter to the trial court to allow Circle Ridge the opportunity to properly segregate fees so that the trial court can make a factual determination on the amount of fees that were reasonable and necessary to litigate the claims for which attorney's fees are recoverable, in accordance with the guidelines set forth in Chapa.
We reverse only the amount of the trial court's award of attorney's fees and remand the matter to the trial court for further proceedings limited solely to that issue. We affirm the trial court's judgment in all other respects.
As established by the record, the Filed Assignment was marked by Circle Ridge's counsel solely for the purpose of "requesting a ruling from the Court that . . . it is violative of the statute of fraud[s]" and was never offered by any party. Accordingly, the trial court did not rule on its admission or exclusion.
However, the brief presents no argument on these points. It is unclear whether these points of error were included in the list of issues presented by mistake or whether any argument on these points was omitted by mistake. In any event, to the extent that Great Northern actually intended to raise these separate points, we overrule them under Rule 38.1(i) of the Texas Rules of Appellate Procedure. See TEX. R. APP. P. 38.1(i).