Frank Keathley and Melissa Keathley v. Corbitt Baker, Carroll Bobo D/B/A United Country Bobo Realty and Molly Bobo D/B/A United Country Bobo Realty

CourtCourt of Appeals of Texas
DecidedApril 3, 2013
Docket12-11-00151-CV
StatusPublished

This text of Frank Keathley and Melissa Keathley v. Corbitt Baker, Carroll Bobo D/B/A United Country Bobo Realty and Molly Bobo D/B/A United Country Bobo Realty (Frank Keathley and Melissa Keathley v. Corbitt Baker, Carroll Bobo D/B/A United Country Bobo Realty and Molly Bobo D/B/A United Country Bobo Realty) 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
Frank Keathley and Melissa Keathley v. Corbitt Baker, Carroll Bobo D/B/A United Country Bobo Realty and Molly Bobo D/B/A United Country Bobo Realty, (Tex. Ct. App. 2013).

Opinion

NO. 12-11-00151-CV

IN THE COURT OF APPEALS

TWELFTH COURT OF APPEALS DISTRICT

TYLER, TEXAS

FRANK KEATHLEY AND § APPEAL FROM THE MELISSA KEATHLEY, APPELLANTS

V. § COUNTY COURT AT LAW #3

CORBITT BAKER, APPELLEE § SMITH COUNTY, TEXAS

MEMORANDUM OPINION Frank and Melissa Keathley appeal from an adverse judgment rendered on the jury’s verdict in favor of Corbitt Baker in the Keathleys’ suit arising from a real estate contract. In six issues, the Keathleys contend the trial court erroneously vacated a prior judgment, awarded attorney’s fees to Baker, failed to award attorney’s fees to the Keathleys, submitted certain jury questions, and directed a verdict against them on their fraud claims. We suggest a partial remittitur of attorney’s fees and otherwise affirm the trial court’s judgment.

BACKGROUND In 2003, Baker’s mother, Ruth, entered into a residential real estate listing agreement with Carroll and Molly Bobo, doing business as United Country Bobo Realty, to sell her home. After her death in early 2004, Baker agreed to sell the home to the Keathleys and entered into a residential real estate contract with them. The title policy commitment revealed that title to the home was held by The Bobby H. Baker and Ruth E. Baker Revocable Living Trust. The title company would not issue a title policy on the house unless Baker’s father and brother signed the deed conveying the house to the Keathleys. Baker’s father and brother refused to sign. The Keathleys, unaware that Baker was having trouble obtaining clear title, sold their home, secured financing, and notified Baker that they were ready to close by the June 1, 2004 deadline stated in the sales contract. The closing did not occur, and the Keathleys purchased a different home in September 2004. On January 5, 2005, the Keathleys sent Baker notice of their Deceptive Trade Practices Act (DTPA) claim against him, alleging $45,000.00 in damages resulting from the fact that the sale did not close. They requested settlement of the dispute but alluded to their option of filing a lawsuit. Baker filed a declaratory judgment action to establish his title to the property and, on September 16, 2005, he obtained a judgment establishing that he had clear title. On January 31, 2006, Baker informed the Keathleys that he had cured the objections in the title commitment and was prepared to close on the contract for the sale of the home in seven days. On February 3, 2006, the Keathleys filed suit against Baker and the Bobos, alleging violations of the DTPA, breach of contract, common law fraud, statutory fraud, and negligent misrepresentation. Baker filed a counterclaim against the Keathleys, alleging breach of contract for failing or refusing to close in accordance with the contract once he had cured the title objections. Baker and the Bobos filed motions for summary judgment, which were granted. On September 20, 2007, the trial court rendered a take nothing judgment against the Keathleys, and awarded Baker and the Bobos their attorney’s fees.1 The Keathleys appealed that judgment. On appeal, we affirmed the judgment that the Keathleys take nothing against Baker and the Bobos on their DTPA and negligent misrepresentation causes of action. We reversed the trial court’s judgment regarding the Keathleys’ breach of contract, common law fraud, and statutory fraud causes of action against Baker and the Bobos, and its award of attorney’s fees, and remanded the case to the trial court for further proceedings. Keathley v. Baker, No. 12-07-477-CV, 2009 Tex. App. LEXIS 4957 (Tex. App.–Tyler June 30, 2009, no pet.). On remand, the Keathleys elected not to pursue their common law fraud claim, and the trial court directed a verdict in favor of Baker and the Bobos on the Keathleys’ statutory fraud claim. The breach of contract claim was submitted to the jury. Based on the jury’s verdict, on March 8, 2011, the trial court rendered a take nothing judgment in favor of Baker and the Bobos and awarded attorney’s fees to Baker. On April 12, 2011, the trial court signed a second final

1 Although the judgment does not specifically mention Baker’s counterclaim for breach of contract, the judgment contains a Mother Hubbard clause denying all relief not expressly granted. Further, the judgment includes language that indicates finality by stating that “[t]his judgment finally disposes of all parties’ claims and is appealable.”

2 judgment, purportedly incorporating the jury verdict, but rendering judgment for the Keathleys and awarding them attorney’s fees. On April 18, 2011, the court signed an order vacating the final judgment erroneously entered on April 12, 2011. The April 18 order provides that the March 8, 2011 judgment correctly reflects the judgment of the court based upon the jury’s verdict. The trial court later severed the Keathleys’ case against the Bobos from their case against Baker. This appeal involves only the claims against Baker.

FINAL JUDGMENT In their first and second issues, the Keathleys assert that the trial court erred in signing the April 18, 2011 order vacating the April 12 judgment. They contend the April 12 judgment was proper because they were the prevailing parties “under the pleadings, the nature of the case, the evidence and the verdict pursuant to Rule 301.” The Keathleys argue that they are the prevailing parties because the jury found that Baker breached the contract and they were entitled, as a matter of law, to judgment for the $2,000.00 in earnest money they had deposited with Landmark Title as damages for the breach. They further argue that the April 18 order cannot reinstate the March 8 judgment because the March 8 judgment had been vacated under Texas Rule of Civil Procedure 329b. The Keathleys concede that the trial court signed each of the documents while it had plenary power over the case. They assert that the April 18 judgment is the final judgment to be addressed in this appeal. However, they contend, that judgment should be reversed and judgment should be rendered reflecting the terms of the April 12 judgment. Prevailing Party The Keathleys begin by arguing that the April 12 judgment in their favor should stand because they were the prevailing parties. We disagree. A plaintiff must receive some relief on the merits on his claim before he can be said to prevail. Intercontinental Group P’ship v. KB Home Lone Star L.P., 295 S.W.3d 650, 654 (Tex. 2009). Whatever relief the plaintiff secures must directly benefit him at the time of the judgment. Id. A plaintiff “prevails” when actual relief on the merits of his claim materially alters the legal relationship between the parties by modifying the defendant’s behavior in a way that directly benefits the plaintiff. Id. The jury determined that Baker failed to comply with the contract. It also determined, however, that, pursuant to the terms of the contract, the contract terminated because the property did not satisfy the lender’s underwriting requirements for the loan and objections to defects to title were not

3 cured within fifteen days after Baker received the objections. Accordingly, the jury was instructed that, based on those findings, they were not to address the question of compensation to the Keathleys for damages. Even if the jury’s finding is equivalent to a finding of breach, a stand-alone finding on breach confers no benefit whatsoever. Id. at 655. The Keathleys recovered no damages, and secured no declaratory or injunctive relief. They received nothing of value of any kind. See id. We are also not persuaded by the Keathleys’ earnest money argument. Earnest money is a deposit made by the buyer with an escrow agent to bind a sale of real property. See Cowman v.

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Frank Keathley and Melissa Keathley v. Corbitt Baker, Carroll Bobo D/B/A United Country Bobo Realty and Molly Bobo D/B/A United Country Bobo Realty, Counsel Stack Legal Research, https://law.counselstack.com/opinion/frank-keathley-and-melissa-keathley-v-corbitt-bake-texapp-2013.