COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 2-03-339-CV
CHARLES
GLEN HYDE, HYDE-WAY, APPELLANTS
INC.,
AVIATION UTILITIES
SERVICES,
INC., AND TEXAS
AIR
CLASSICS
V.
JIMMY
RAY AND TRENT CRAGIN APPELLEES
------------
FROM
THE 393RD DISTRICT COURT OF DENTON COUNTY
MEMORANDUM OPINION1
Appellees,
Jimmy Ray (Ray) and Trent Cragin (Cragin), filed this suit against Appellants,
Charles Glen Hyde, Hyde-Way, Inc., Aviation Utilities Services, Inc., and Texas
Air Classics, asserting claims of, among other things, breach of contract and
tortious interference, as well as requesting, among other things, that
Appellants be temporarily enjoined from withdrawing funds derived from fees paid
to obtain licenses for the use of the runways and taxiways at Northwest Regional
Airport and from interfering with Ray’s or Ray’s tenants’ use of the
runways and taxiways at Northwest Regional Airport. The trial court granted the
temporary injunction. In three issues, Appellants argue that the trial court
abused its discretion by granting the temporary injunction. Because we hold that
the trial court did not abuse its discretion, we affirm the trial court’s
order.
Background
Facts
Texas
Air Classics owns Northwest Regional Airport’s runways and taxiways, which it
bought from Hyde-Way. When Hyde-Way bought the airport, it also bought a large
portion of the adjoining property for development. In 1983, Hyde-Way filed deed
restrictions and a license agreement with the Denton County Clerk for the
property that it developed. Ray, Cragin, and approximately 184 other individuals
own hangars near the airport. Appellees’ hangars are part of the property
developed by Hyde-Way. Ray initially bought the hangar now owned by Cragin in
1991 and converted it to a residential apartment. After selling his apartment to
Cragin in 2002, Ray bought another hangar.
Pursuant
to the license agreement attached to the deed restrictions, the hangar owners
may pay a fee to obtain a license to use the runways and taxiways. The license
fee is collected to provide “for the maintenance, repair, construction and
reconstruction of the airport facilities” and “a reasonable payment to the
Licensor for his necessary services and time.” The deed restrictions encourage
improvements on the property but require plans and specifications of the
improvements to be submitted to and approved in writing by Hyde-Way. The
restrictions provide that the hangars cannot be used for residential purposes.
When Hyde-Way sold the airport to Texas Air Classics, it retained exclusive
right to collect the license fee and grant access to the runways and taxiways as
set forth in the license agreement. Thus, Hyde-Way controls the license fee
funds and claims ownership in the funds. Hyde-Way never withdrew any of the
funds as compensation for services and time until this suit commenced, at which
time it withdrew $25,000.
Appellees
are both using their hangars for residential purposes. Ray was also observed
digging up the taxiway and pouring concrete in front of his hangar, blocking the
taxiway from being used. At no time did Ray submit or receive approval for this
activity. Additionally, Ray had his contractor dump the excess dirt on Hyde’s
property, blocking the drainage. Because Hyde-Way believed that these actions
violated the deed restrictions, Hyde-Way informed Appellees that the violations
terminated the license and that neither they nor their tenants could use the
runways and taxiways any longer. After attempting to use the runways and
taxiways and being prevented from doing so by Hyde-Way, Appellees filed for an
injunction to keep Appellants from preventing their use of the runways and
taxiways and also to prevent Appellants from withdrawing any of the license fee
funds.
Appellees
originally sued Appellants to, among other things, enjoin them from
disconnecting water to their hangars. The trial court granted a temporary
injunction regarding the water, which was appealed to this court.2 This court abated the case until the hearing before
the water commission has been concluded and the commission has made findings
relevant to that issue. The temporary injunction at issue in this appeal (the
second temporary injunction) enjoins Appellants from accepting Ray’s license
fee, from interfering with Ray’s and Ray’s tenants’ use of the runways and
taxiways, and from withdrawing more than the ordered amount from the license fee
funds.
Appellants
now argue that the trial court abused its discretion by granting the second
temporary injunction because necessary and indispensable parties were not joined
in the suit, the injunction was based upon an improper revising of the governing
license instrument, and the undisputed evidence established that Ray and Ray’s
tenants became trespassers.
Standard of
Review
The
sole issue before the trial court in a temporary injunction hearing is whether
the applicant may preserve the status quo of the litigation's subject matter
pending trial on the merits.3 An applicant
must plead and prove three elements to obtain a temporary injunction: (1) a
cause of action against the defendant; (2) a probable right to the relief; and
(3) a probable, imminent, and irreparable injury in the interim.4 An injury is irreparable if the injured party cannot
be adequately compensated in damages or if the damages cannot be measured by any
certain pecuniary standard.5
The
applicant for a temporary injunction is not required to establish that he or she
will prevail upon a final trial.6 The merits
of the applicant's suit are not presented for review.7
Our review is strictly limited to whether the trial court abused its discretion
in granting the temporary injunction.8 We may
not substitute our judgment for that of the trial court by vacating or modifying
an injunction simply because we would have decided otherwise.9
An abuse of discretion does not occur as long as there is some evidence to
support the trial court’s decision.10
Furthermore, an abuse of discretion does not exist where the trial court bases
its decision on conflicting evidence.11 As
the reviewing court, we must draw all legitimate inferences from the evidence in
a manner most favorable to the trial court's order granting a temporary
injunction and determine whether the order was so arbitrary as to exceed the
bounds of reasonable discretion.12
Necessary and
Indispensable Parties
We
first consider Appellants’ issue that the temporary injunction was improperly
granted because the remaining 184 property owners and the members of the
Northwest Regional Property Owners Association having an interest in the deed
restrictions and in Appellants’ use of the licensing funds are necessary and
indispensable parties that were not joined.13
We are concerned that, at least insofar as Appellees’ request for declaratory
judgment in the underlying lawsuit is concerned, some, if not all, of such
persons would be indispensable parties.14 But
courts have held that a person with rights to be preserved pending final trial
need not join all necessary parties before obtaining interim orders, such as a
temporary injunction.15 “Persons against
whom no complaint of wrongdoing is lodged and against whom no injunctive relief
is sought are not indispensable parties to a proceeding for temporary
injunction. It may well be that other parties will have to be brought into
the suit. This, however, is not fatal to the temporary equitable relief
granted.”16
In
Lowe v. City of Del Rio, the Texas Supreme Court, after reversing a final
judgment for lack of indispensable parties, expressly ordered that the temporary
injunction granted by the trial court remain in effect pending a final
determination of the controversy on the merits.17
This is clearly a holding that the absence of parties whose presence is
essential to the final determination of a controversy does not preclude the
granting of temporary relief.18
Thus,
on appeal of a preliminary matter, such as the issuance of this temporary
injunction, the question of necessary and indispensable parties is not reached.19 Appellees’ pleadings and the evidence establish
that Appellees seek to temporarily enjoin only the allegedly wrongful conduct of
Appellants, who are now before us and whose conduct is solely responsible for
Appellees’ claimed injury.20 Therefore, we
overrule Appellants’ first issue.
Temporary
Injunction Elements
To
obtain a temporary injunction, an applicant must plead and prove the absence of
an adequate remedy at law; probable, imminent, and irreparable injury in the
interim; and probable right to recover on the merits.21
We construe Appellants’ second and third issues as challenges to Appellees’
probable right to recover on the merits.
Probable Right to Recover
Appellants’
second issue challenges Appellees’ probable right to recover on any claim
regarding the withdrawal of money from the license fee fund. Accordingly, they
contend the trial court erred in issuing the second temporary injunction
regarding the challenged expenditures. Appellants contend several provisions of
the license contract expressly permit them to expend unspecified amounts of
funds from the license fees to Hyde-Way as management compensation, even though
Hyde-Way holds equitable title to the funds. While the findings of the trial
court read much like an order of declaratory judgment, we are restrained from
reviewing more than the temporary injunction that is before us on interlocutory
appeal.22 We therefore may not examine the
merits of the declaratory judgment action brought by Appellees. After
reviewing the record, we determine that Appellees have sufficiently demonstrated
a probable injury and a probable right to recovery for the purposes of this
temporary injunction.23
The
expression “probable right to recover” is a term of art; it does not imply
any kind of determination that becomes the law of the case, and the district
court did not, by its determinations, find the truth and apply the law based on
“probabilities” in the meaning that word has in ordinary usage.24 Instead, concerning both the facts and the law,
Appellees were only required to show “that a bona fide issue exists as to
[their] right to ultimate relief.”25 That
is, Appellees were required only to adduce evidence that tends to support their
right to recover on the merits.26
We
hold the trial court reasonably concluded that Appellees showed a probable right
of recovery. The contract documents were undisputed by the parties in the
evidentiary hearing. Unless the contracts authorize Appellants to expend
the money in lump sum for twenty years of work, Appellants are entirely without
any contractual authority to withdraw the money for that purpose.
The
contract provisions urged by Appellants are quite general. They do not
explicitly declare whether Appellants may expend the funds in a large lump sum,
as Appellants have done. The contract documents do not give Appellants
that authority in explicit terms. If the authority exists, it must be in
consequence of a construction given the documents by the court after final
hearing as to the intentions of the parties. Appellees showed the
existence of a bona fide issue; no more was required. Therefore, the trial
court did not abuse its discretion. We overrule Appellants’ second
issue.
Appellants’
third issue challenges Appellees’ probable right to recover from a breach of
the license agreement or tortious interference. Appellants argue that
Appellees were trespassers on the runway and thus they did not have a probable
right to recover on the merits of their claims in the underlying lawsuit of
breach of the license or tortious interference.
The
license agreement does not explicitly state that a violation of the deed
restrictions terminates the license. Although, upon trial on the merits,
it may be found that Appellees did in fact violate the deed restrictions and
should be penalized, neither the deed restrictions nor the license agreement
clearly states that termination of the license is the penalty for such a
violation. Again, if the authority for termination exists, it must be in
consequence of a construction given the documents by the court after final trial
on the merits.27 Because bona fide issues
exists regarding Appellants’ ability to terminate the license for deed
restriction violations, we hold that the trial court did not abuse its
discretion by finding that Appellees have a probable right to recover for
purposes of maintaining the status quo until trial on the merits. We
overrule Appellants’ third issue.
Conclusion
Having
overruled Appellants’ issues, we affirm the trial court’s order.
LEE
ANN DAUPHINOT
JUSTICE
PANEL
A: LIVINGSTON, DAUPHINOT, and HOLMAN, JJ.
DELIVERED:
June 10, 2004
NOTES
1.
See Tex. R. App. P. 47.4.
2.
Hyde v. Ray, No. 02-03-123-CV.
3.
Butnaru v. Ford Motor Co., 84 S.W.3d 198, 204 (Tex. 2002); Walling v.
Metcalfe, 863 S.W.2d 56, 57 (Tex. 1993); Mabrey v. SandStream, Inc.,
124 S.W.3d 302, 308–09 (Tex. App.—Fort Worth 2003, no pet.).
4.
Butnaru, 84 S.W.3d at 204; Walling, 863 S.W.2d at 57; Mabrey,
124 S.W.3d at 309.
5.
Butnaru, 84 S.W.3d at 204; Canteen Corp. v. Republic of Tex. Props.,
Inc., 773 S.W.2d 398, 401 (Tex. App.—Dallas 1989, no writ).
6.
Butnaru, 84 S.W.3d at 204 (citing Sun Oil Co. v. Whitaker, 424
S.W.2d 216, 218 (Tex. 1968)); Walling, 863 S.W.2d at 58; Mabrey,
124 S.W.3d at 309.
7.
Mabrey, 124 S.W.3d at 309; Universal Health Servs. Inc. v. Thompson,
24 S.W.3d 570, 576 (Tex. App.—Austin 2000, no pet.); Birnbaum v. Alliance
of Am. Insurers, 994 S.W.2d 766, 783 (Tex. App.—Austin 1999, pet. denied)
(noting that appeal from temporary injunction may not be used to obtain advance
ruling on merits), abrogated on other grounds by In re Bass,
113 S.W.3d 735 (Tex. 2003) (orig. proceeding).
8.
See Butnaru, 84 S.W.3d at 204; Mabrey, 124 S.W.3d at 309; Gen.
Fin. Servs., Inc. v. Practice Place, Inc., 897 S.W.2d 516, 519 (Tex.
App.—Fort Worth 1995, no writ).
9.
Mabrey, 124 S.W.3d at 309; Miller Paper Co. v. Roberts Paper Co.,
901 S.W.2d 593, 598 (Tex. App.—Amarillo 1995, no writ); see also Butnaru,
84 S.W.3d at 211.
10.
Butnaru, 84 S.W.3d at 211; Mabrey, 124 S.W.3d at 309.
11.
Mabrey, 124 S.W.3d at 309.
12.
Id.; Bell v. Tex. Workers Comp. Comm'n, 102 S.W.3d 299, 302 (Tex.
App.—Austin 2003, no pet.); Rugen v. Interactive Bus. Sys., Inc., 864
S.W.2d 548, 551 (Tex. App.—Dallas 1993, no writ); Bertotti v. C.E. Shepherd
Co., 752 S.W.2d 648, 651 (Tex. App.—Houston [14th Dist.] 1988, no writ).
13.
See Tex. Civ. Prac. & Rem.
Code Ann. § 37.006(a) (Vernon 1997); Tex. Prop. Code Ann. § 201.010 (Vernon
2000); Tex. R. Civ. P. 39.
14.
See Tex. Civ. Prac. & Rem.
Code Ann. § 37.006(a); Tex. Prop.
Code Ann. § 201.010; Tex. R. Civ.
P. 39.
15.
Crain v. Firemen's & Policemen's Civil Serv. Comm’n of City of Fort
Worth, 495 S.W.2d 20, 24 (Tex. App.—Fort Worth 1973, writ ref’d n.r.e.),
disapproved on other grounds by Firemen’s & Policemen’s Civil Serv.
Comm’n of City of Fort Worth v. Williams, 531 S.W.2d 327 (1975); Speedman
Oil Co. v. Duval County Ranch Co., Inc., 504 S.W.2d 923, 926–27 (Tex.
App.—San Antonio 1973, writ ref’d n.r.e.); Littlejohn v. Finder, 348
S.W.2d 237, 239 (Tex. App.—San Antonio 1961, no writ); Temple ISD v.
Proctor, 97 S.W.2d 1047, 1051 (Tex. App.—Austin 1936, writ ref’d).
16.
Speedman Oil Co., 504 S.W.2d at 926; Hidalgo County Water Improvement
Dist. No. 2 v. Cameron County Water Control & Improvement Dist. No. 5,
253 S.W.2d 294, 299–300 (Tex. App.—San Antonio 1952, writ ref'd n.r.e.).
17.
122 S.W.2d 191, 192 (Tex. 1938); Hidalgo County Water Improvement Dist. No. 2,
253 S.W.2d at 299–300.
18.
Hidalgo County Water Improvement Dist. No. 2, 253 S.W.2d at 299.
19.
See Brooks v. Expo Chem. Co., 576 S.W.2d 369, 370 (Tex. 1979); Rogers
v. Howell, 592 S.W.2d 402, 403 (Tex. App.—Dallas 1979, writ ref’d n.r.e.);
Charter Med. Corp. v. Miller, 547 S.W.2d 77, 78 (Tex. App.—Dallas 1977,
no writ).
20.
See Speedman Oil Co., 504 S.W.2d at 926.
21.
Butnaru, 84 S.W.3d at 204; Walling, 863 S.W.2d at 57; Mabrey,
124 S.W.3d at 309.
22.
See Tex. Alcoholic Beverage Comm'n v. Amusement & Music Operators of
Tex., Inc., 997 S.W.2d 651, 658 (Tex. App.—Austin 1999, pet. dism’d
w.o.j.).
23.
See id.
24.
183/620 Group Joint Venture v. SPF Joint Venture, 765 S.W.2d 901, 904
(Tex. App.—Austin 1989, writ dism’d w.o.j.).
25.
Id.
26.
Id.
27.
See id.