Bridgestone Lakes Community Improvement Ass'n v. Bridgestone Lakes Development Co.

489 S.W.3d 118, 2016 Tex. App. LEXIS 3174, 2016 WL 1237877
CourtCourt of Appeals of Texas
DecidedMarch 29, 2016
DocketNO. 14-14-00604-CV
StatusPublished
Cited by27 cases

This text of 489 S.W.3d 118 (Bridgestone Lakes Community Improvement Ass'n v. Bridgestone Lakes Development Co.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bridgestone Lakes Community Improvement Ass'n v. Bridgestone Lakes Development Co., 489 S.W.3d 118, 2016 Tex. App. LEXIS 3174, 2016 WL 1237877 (Tex. Ct. App. 2016).

Opinions

MAJORITY OPINION

Tracy Christopher, Justice

This is an appeal from a final judgment rendered after two interlocutory summary judgments and one bench trial. We conclude that the trial court erred by entering [121]*121one of the summary judgments, and the error was harmful. We affirm the trial court’s judgment in part, reverse it in part, and remand for additional proceedings consistent with this opinion.

BACKGROUND

The Bridgestone Lakes Development Company (the “Developer”) built a three-acre storm water detention pond to service a residential subdivision in the northern part of Harris County. According to the subdivision’s homeowners association, the Bridgestone Lakes Community Improvement Association (the “HOA”), the Developer’s construction of the pond varied in several respects from the plans that were approved by the local utility district. The HOA asserted that the variances led to increased rates of soil erosion, which in turn led to increased costs of maintaining the pond.

In 2008, the Developer entered into a Detention Pond Maintenance Agreement with the utility district and the HOA. In the agreement, the Developer acknowledged that the pond, as built, varied from the plans approved by the utility district. The parties stipulated that the increased cost of maintaining the pond as a result of the variances was “uncertain and difficult to ascertain.” The Developer agreed to deposit $25,000 with the utility district to pay for the estimated cost of maintenance. In return, the utility district agreed that it would perform the maintenance. The HOA agreed that it would pay for all additional maintenance once the utility district exhausted the funds deposited by the Developer.

By 2012, the costs for maintaining the pond were expected to increase dramatically, with one estimate exceeding $125,000. In an effort to recover those increased costs, the HOA sued the Developer and three other individuals who formerly served on the HOA’s board of directors. The individuals were Robert Hudson, Claudia Hudson, and Tiffany Roath (collectively,, the “Directors”).

Against the Directors, the HOA asserted claims for breach of fiduciary duty, failure to act in good faith, and fraud. The HOA alleged that the Directors breached their fiduciary duty and duty to act in good faith by not ensuring that the pond was constructed according to the approved plans. The HOA also alleged that the Directors breached these duties by entering into the maintenance agreement. The HOA claimed that the agreement was not negotiated at arm’s length because, at the time of its execution, the Directors were also serving on the Developer’s board of directors, whose interests were adverse to the HOA. In its fraud claim, the HOA alleged that the Directors failed to disclose to their successors on the HOA that there were variances in the pond and that, under the terms of the maintenance agreement, the HOA must bear the increased costs of maintaining the pond.

Against both the Developer and the Directors (collectively, the “Defendants”), the HOA asserted claims for negligence, gross negligence, and willful misconduct. Each of these claims was based on the Defendants’ alleged failure to construct the pond in accordance with the plans approved by the utility district.

THE TRADITIONAL SUMMARY JUDGMENT

Over the course of the litigation, the HOA expanded on its description of how the pond varied from the approved plans. At the time of its -Second Amended Petition, the HOA focused on just two claimed variances. The first variance was the omission of a thirty-foot maintenance berm, which the plans allegedly called for. The second variance was the addition of a [122]*122sidewalk along the perimeter of the pond, which the plans allegedly did not call for. The HOA contended that these variances increased the rate of soil erosion around the pond, which consequently increased the costs of maintenance.

The Defendants filed a traditional motion for summary judgment when the HOA’s live pleading was still its Second Amended Petition. In pertinent part, the Defendants argued that they did not owe a duty to build the berm because the utility district did not require it. They also argued that the increased costs of maintaining the pond were caused by damage from Hurricane Ike and an infestation of nutria, a rodent similar to beavers, and not the absence of the berm and presence of the sidewalk.

Before the hearing on the motion for summary judgment, the HOA filed a Third Amended Petition, in which it asserted two more variances in the construction of the pond. The HOA alleged that the Developer built the pond with variable 2:1 slopes in some areas and 3:1 slopes in others, when the plans allegedly called for a uniform 3:1 slope along all sides. The HOA also alleged that the Developer installed a fence around the pond when the plans allegedly did not call for it. The HOA contended that the fence affected the slopes, and the slopes contributed to the soil erosion.

The trial court granted the Defendants’ motion for summary judgment and signed an interlocutory order dismissing all of the HOA’s claims. In its first issue on appeal, the HOA argues that trial court reversibly erred because the summary judgment disposed of claims not addressed in the Defendants’ motion. The HOA focuses on the claims in its Third Amended Petition, and specifically those which alleged that the Defendants constructed the pond with variable slopes.

We review summary judgments de novo. See Exxon Corp. v. Emerald Oil & Gas Co., 331 S.W.3d 419, 422 (Tex.2010). A trial court properly grants a traditional summary judgment when the defendant conclusively negates at least one essential element of the plaintiffs cause of action. See Henkel v. Norman, 441 S.W.3d 249, 251 (Tex.2014) (per curiam). The defendant must state in its motion the specific grounds upon which the summary judgment should be granted. See Tex. R. Civ. P. 166a(c). A trial court cannot grant a summary judgment on grounds that were not presented. See FDIC v. Lenk, 361 S.W.3d 602, 609 (Tex.2012).

When the Defendants filed their motion for summary judgment, the HOA’s live pleading was its Second Amended Petition, and all of the causes of action in that pleading were based on just two claimed variances: the omission of the berm and the addition of the sidewalk. The arguments in the Defendants’ motion for summary judgment were structured around these two factual allegations. The Defendants argued that they had no duty to build a berm. They also argued that all of the HOA’s damages were attributable to causes other than the missing berm and the added sidewalk.

The HOA expanded on the claimed variances in its Third Amended Petition, specifically alleging that the Defendants constructed the pond with variable rather than uniform slopes. The HOA incorporated this factual allegation into all of its causes of action, but the Defendants never responded to that allegation by amending their motion for summary judgment. Instead, the Defendants addressed this allegation in a summary-judgment reply, contending that there was no “controverting summary judgment proof on the issue of duty” and no “controverting evidence that the side slope is not uniformly 3:1.”

[123]*123As the movants below, the Defendants had the initial burden to negate the issue of either duty or causation. See Wal-Mart Stores, Inc. v.

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Cite This Page — Counsel Stack

Bluebook (online)
489 S.W.3d 118, 2016 Tex. App. LEXIS 3174, 2016 WL 1237877, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bridgestone-lakes-community-improvement-assn-v-bridgestone-lakes-texapp-2016.