Farouck (Frank) Alattar v. John Ganim

CourtCourt of Appeals of Texas
DecidedFebruary 18, 2010
Docket14-08-00756-CV
StatusPublished

This text of Farouck (Frank) Alattar v. John Ganim (Farouck (Frank) Alattar v. John Ganim) 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
Farouck (Frank) Alattar v. John Ganim, (Tex. Ct. App. 2010).

Opinion

Reversed and Rendered and Opinion filed February 18, 2010.

In The

Fourteenth Court of Appeals

___________________

NO. 14-08-00756-CV

FAROUK (FRANK) ALATTAR, Appellant

V.

JOHN GANIM, Appellee

On Appeal from the 400th District Court

Fort Bend County, Texas

Trial Court Cause No. 06-CV-148738

MEMORANDUM OPINION

            In the dispositive issue in this appeal, we are asked to determine whether the statute of frauds bars a claim for appellant’s alleged breach of an agreement to purchase real property on behalf of a partnership.  Because the statute of frauds applies but was not satisfied, we reverse and render judgment that appellee take nothing.

I.  Factual and Procedural Background

            On March 17, 2004, friends Farouk Alattar, a/k/a Frank Alattar, and John Ganim toured a property of approximately 3,800 acres (the “Property”) in Washington County, Texas.  Two days later, on March 19, 2004, Ganim again was present when Alattar executed a Purchase and Sale Agreement (“Purchase Agreement”) to buy the land.  In the Purchase Agreement, the buyer is identified as “Frank Alattar, Trustee.”  The trust’s name and beneficiaries are not identified. 

            On March 22, 2004, Alattar and Ganim signed a document subsequently referred to as the “Letter of Intent.”  This document provides in pertinent part as follows:

1.         Partnership will be 50 – 50% of all profits between John Ganim and Farouk Alattar.

2.         Farouk Alattar will be the sole person making decisions for any future sale of property as long as it’s double or more price than we bought it for to avoid misunderstandings. . . .

. . .

5.         Both partners have the right, after any sale, to pull 50% of the proceeds . . . .

10.       Both partners could use any part of the property at anytime [sic] until property is sold.

11.       Any partner that wants a piece of the land for himself or family and friends, it must be sold at fair market price regardless.

13.       This partnership will not be valid if the Bank does not accept either one’s credit application.

Although there are references in the Letter of Intent to a “future sale of property,” the property to be sold is not identified.  The Letter of Intent contains no references to any property contributed or to be contributed to the partnership, or property purchased or to be purchased by or for the partnership.

            As relevant to this appeal, the record also contains an unsigned letter dated March 25, 2004 from attorney Michael Noonan to Frank Alattar (the “Unsigned Letter”).  The letter bears the heading, “Re: Earnest Money Contract – 3800 acres – Washington County, Texas.”  In the Unsigned Letter, Noonan wrote, “I have had an opportunity to review the Earnest Money Contract concerning your purchase of the 3800 acres near Brenham.”  After providing legal advice on a number of points pertaining to the Purchase Agreement, Noonan wrote, “We have had some discussions on proposed entity structure for this transaction and I will commence the formation of a limited partnership and a limited liability company to be general partner.”

            On March 26, 2004, Noonan again wrote to Alattar; his signed cover letter (“Cover Letter”) bears the heading “Re: Gates Bluebonnet Hills, Ltd. and Alattar Interests, LLC.”  With the Cover Letter, Noonan enclosed documents creating these organizations.  Noonan further wrote, “I am sending a copy of the partnership materials to John Ganim for his review. . . . Please review the materials and advise as to any further changes . . . . Once it is all approved, please sign the documents and return them to me for filing . . . .”

            Shortly thereafter, Alattar and Ganim executed an Agreement of Limited Partnership of Gates Bluebonnet Hills, Ltd. (“Partnership Agreement”).  By its terms, the Partnership Agreement was effective March 29, 2004.  General partner Alattar Interests, LLC owns a 1% interest in the partnership, and John Ganim and Farouk Alattar, as limited partners, each own a 49.50% interest in the partnership.  Two exhibits form the last pages of the Partnership Agreement.  Exhibit A identifies the parties, their addresses, their percentage interests, and the fair market value of the initial contributions of each.  Alattar Interests, LLC’s contribution is valued at $10, Alattar’s contribution is valued at $250,000, and Ganim’s contribution is valued at $1,000,000.  Exhibit B is labeled “Assets to be Contributed by General Partner,” but is otherwise blank.

            After Ganim executed the Partnership Agreement, his attorney, William R. Bromley, reviewed it.  On April 2, 2004, Bromley wrote to Ganim that the terms of the Partnership Agreement, which Bromley referred to as “the proposed limited partnership agreement,” were not the same as the terms in the Letter of Intent.  Bromley suggested changes that, in his view, were “so necessary that [he] would not do the deal” unless such changes were made.  Ganim testified that he faxed Bromley’s letter to Alattar, whereupon Alattar told Ganim that he, Alattar, would not do business with Ganim.  On April 7, 2004, Alattar’s attorney wrote Ganim’s attorney that Alattar would not proceed with the partnership.

            On May 13, 2004, Ganim sued Alattar, eventually asserting claims for fraud, constructive fraud, fraudulent inducement, negligent misrepresentation, breach of contract, and breach of fiduciary duty.  In his pleadings, Ganim sought an accounting, lost profits, punitive damages, the imposition of a constructive trust, specific performance, attorneys’ fees, and costs.

            While these events were unfolding, the Property owners became involved in litigation over title to the Property, causing the closing date of the sale to be delayed for approximately a year.  On May 17, 2005, the Property was conveyed by special warranty deed (“Deed”), effective April 20, 2005, to “Farouk Alattar, Trustee.”  As with the Purchase Agreement, the Deed does not identify the trust’s name or beneficiaries.

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Farouck (Frank) Alattar v. John Ganim, Counsel Stack Legal Research, https://law.counselstack.com/opinion/farouck-frank-alattar-v-john-ganim-texapp-2010.