Gunter v. EMPIRE PIPELINE CORP.

310 S.W.3d 19, 2009 Tex. App. LEXIS 5685, 2009 WL 2196119
CourtCourt of Appeals of Texas
DecidedJuly 24, 2009
Docket05-08-00824-CV
StatusPublished
Cited by15 cases

This text of 310 S.W.3d 19 (Gunter v. EMPIRE PIPELINE CORP.) 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
Gunter v. EMPIRE PIPELINE CORP., 310 S.W.3d 19, 2009 Tex. App. LEXIS 5685, 2009 WL 2196119 (Tex. Ct. App. 2009).

Opinion

OPINION

Opinion By Justice FITZGERALD.

Appellant H. Glenn Gunter sued appel-lees Empire Pipeline Corporation, Empire Exploration, L.P., and Empire Exploration Corporation (collectively “Empire”). The parties signed a mediated settlement agreement, but Gunter later filed a motion to invalidate the settlement. Instead, the trial court signed an order enforcing the settlement and dismissing the lawsuit. We conclude that the trial court erred by enforcing the settlement in the absence of proper pleadings, proceedings, and proof. We accordingly reverse and remand for further proceedings.

I. BACKGROUND AND ISSUES ON APPEAL

Gunter sued Empire, alleging breach of contract and other theories of recovery. The parties went to mediation after the case had been pending for almost two years, and they signed a document entitled “settlement agreement.” About two months later, Gunter filed a motion to “vacate” the settlement agreement, contending that the agreement was invalid and unenforceable on grounds such as duress and fraud. A few days before the hearing, Gunter filed an amended motion to vacate the settlement agreement. Empire filed a response to the motion to vacate. Although Empire did not style this response as a cross-motion, it included in its prayer a request that the court “enter judgment enforcing the Settlement Agreement and Dismissal with Prejudice of all Plaintiffs Claims.”

The trial court held a nonevidentiary hearing at which the parties presented argument as to the proper procedure to be followed when a party seeks to avoid a settlement agreement. Gunter argued that Empire could not obtain judicial enforcement of the settlement agreement without pleading and proving its right to enforcement through the usual channels— trial or summary judgment. Empire argued that the court could enforce the agreement in a summary fashion if it concluded that the agreement was not ambiguous on its face. The court took the matter under advisement and later signed an order that both enforced the settlement agreement (by ordering Empire Pipeline Corporation to pay the consideration recited in the agreement) and dismissed Gun-ter’s claims with prejudice. Gunter filed a motion for new trial, which the trial court heard and denied.

Gunter presents five issues on appeal. In his first issue, he argues that the trial court erred by enforcing the settlement agreement without proper pleadings by Empire and without proper proof adduced through a trial or motion for summary judgment. In his other issues, he argues the merits of his position that the settlement agreement is unenforceable for various reasons.

*22 II. Analysis

The law in this area is well-settled. The trial court cannot render an agreed judgment after a party has withdrawn its consent to a settlement agreement. Padilla v. LaFrance, 907 S.W.2d 454, 461-62 (Tex.1995); Quintero v. Jim Walter Homes, Inc., 654 S.W.2d 442, 444 (Tex.1983); Crump v. Crump, No. 05-04-01515-CV, 2005 WL 2841146, at *1 (Tex.App.-Dallas Oct. 31, 2005, no pet.) (mem. op.). After consent has been withdrawn, a court may enforce a settlement agreement “only as a written contract.” Mantas v. Fifth Court of Appeals, 925 S.W.2d 656, 658 (Tex.1996) (per curiam). The law does not recognize the existence of any special summary proceeding for the enforcement of a written settlement agreement, even one negotiated and executed in the context of a mediation. Cadle Co. v. Castle, 913 S.W.2d 627, 631 (Tex.App.-Dallas 1995, writ denied) (en banc). Thus, “[a]n action to enforce a settlement agreement, where consent is withdrawn, must be based on proper pleading and proof.” Padilla, 907 S.W.2d at 462. Proper notice and hearing are also required. See id. at 461. In short, if consent is withdrawn, “the only method available for enforcing a settlement agreement is through summary judgment or trial.” Staley v. Herblin, 188 S.W.3d 334, 336 (Tex.App.-Dallas 2006, pet. denied).

Empire had no pleadings to support rendition of judgment on the settlement agreement. It included a prayer for enforcement of the agreement in its response to Gunter’s motion to vacate, but that is not a sufficient pleading for these purposes. See Crump, 2005 WL 2841146, at *1 (“Application for Approval of Agreement to Settle Estates” not a sufficient pleading); Cadle Co., 913 S.W.2d at 681-32 (“Motion to Enforce Settlement Agreement” not a sufficient pleading); see also Rupert v. McCurdy, 141 S.W.3d 334, 339 (Tex.App.-Dallas 2004, no pet.) (“Pleadings are composed of petitions and answers.”). Moreover, the summary procedure employed by the trial court deprived Gunter of the right to be confronted by appropriate pleadings, assert defenses, conduct discovery, and submit factual disputes to a fact finder. Staley, 188 S.W.3d at 337; Crump, 2005 WL 2841146, at *1. Cf In re B.L.A., No. 05-07-00933-CV, 2008 WL 2313658, at *1 (Tex.App.-Dallas June 6, 2008, no pet.) (mem. op.) (“If parties do not adhere to summary judgment practice in cases such as this, the likely result will be uncertainty for the parties and trial courts and disparity in trial courts’ consideration and treatment of individual cases.”). We agree with Gunter that the trial court erred by rendering a judgment that essentially ordered specific performance of the settlement agreement without proper pleadings, proceedings, and proof.

Empire argues that Cadle, Crump, and other cases cited by Gunter are distinguishable. According to Empire, the settlements in those cases were subject to unfulfilled conditions precedent, so the parties could withdraw their consent before the agreements were consummated. Empire further argues that Gunter could not withdraw his consent to the settlement agreement because he “consummated [that agreement] unconditionally.” We disagree with Empire’s interpretation of the cases, and we conclude that Cadle and Crump are controlling. In both cases, one party contended that a settlement was an enforceable agreement, the other party notified the court that it no longer consented to the settlement, and we held that the trial court could not summarily enforce the agreement without proper pleadings, proceedings, and proof. Crump, 2005 WL 2841146, at *1; Cadle, 913 S.W.2d at 630-32. That is precisely the situation pre *23 sented in this case. Just as in Cadle and Crump, we must reverse.

Empire contends that the execution of the settlement agreement destroyed the trial court’s subject-matter jurisdiction by eliminating the “case or controversy” between it and Gunter. We disagree.

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310 S.W.3d 19, 2009 Tex. App. LEXIS 5685, 2009 WL 2196119, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gunter-v-empire-pipeline-corp-texapp-2009.