Hebisen v. Nassau Development Co.

754 S.W.2d 345, 1988 WL 60088
CourtCourt of Appeals of Texas
DecidedJune 16, 1988
DocketC14-86-588-CV
StatusPublished
Cited by28 cases

This text of 754 S.W.2d 345 (Hebisen v. Nassau 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
Hebisen v. Nassau Development Co., 754 S.W.2d 345, 1988 WL 60088 (Tex. Ct. App. 1988).

Opinion

OPINION

JUNELL, Justice.

Nassau Development Company, lessor, sued R.V. Hebisen, Dan Hennigan and Fred Fraser, lessees, to recover more than $55,000.00 allegedly due under an office space lease contract. A cause of action for actual and punitive damages for fraud was also alleged.

We will refer to Hebisen, Hennigan and Fraser as appellants and to Nassau Development Company as appellee.

A jury trial resulted in a verdict favorable to appellee. The trial court rendered judgment for appellee for $38,391.00 “as actual damages,” prejudgment interest thereon, punitive damages of $60,000.00 and attorney’s fees.

We cannot determine whether the $38,-391.00 awarded to appellee “as actual damages” in the judgment was for fraud damages or was for the amount of money the jury found was due to appellee under terms of the lease contract. For reasons explained later in this opinion we affirm that part of the judgment awarding appellee $38,391.00. We base that affirmance on the jury findings of that total amount due under the terms of the lease contract but not as actual damages for fraud. We reverse that portion of the judgment awarding punitive damages for fraud. We sever the entire fraud cause of action for actual and punitive damages and remand it for a new trial. We affirm the judgment in all other respects.

Appellants, three practicing attorneys, entered into a written lease agreement with appellee for approximately 1456 square feet of office space in a building owned by appellee. The common address *347 of the leased premises, as set forth in the lease, is 1275 Space Park Drive, Suite 100, Houston, Harris County, Texas. The building is physically located in Nassau Bay, Texas, which has no post office. The lease term ran from April 1, 1981, through March 31, 1984. Appellants occupied the leased space continuously from April 1, 1981, through April 5, 1984.

According to the lease appellants were to make monthly base rental payments of $1,092.00, plus rental escalation payments based on a formula set forth in the lease agreement. It is undisputed that appellants never made any of the rental escalation payments. They also failed to pay base rent from May, 1983 through April, 1984; and they were late with most earlier base rental payments.

Appellants refused to vacate the leased premises upon demand by appellee in October, 1983. Appellee instituted a forcible detainer action, which was decided in its favor by the Justice Court and again by the County Court at Law on trial de novo. Appellants did not vacate the premises until April 5, 1984, the day a writ of restitution was to issue from the County Court at Law. Appellee then filed this suit against appellants.

With respect to the alleged fraud cause of action the jury made the following findings:

(1) At the time the lease was signed appellants represented that they would pay to appellee the rental payments, including rental escalation payments, under the lease agreement;
(2) appellee relied on the representations to its detriment;
(3) at the time the representations were made appellants did not intend to pay the rental escalation payments; and
(4) appellants made the representations with the intent that they should be acted upon by appellee.

In points of error two and three appellants contend there is no evidence or factually insufficient evidence to support the jury finding that appellee relied on appellants’ representation that they would make rental escalation payments.

We have reviewed all of the evidence and hold it is sufficient to support the jury finding of appellee’s reliance on appellants’ representation. Appellants argue that an element of the fraud cause of action is lacking because the only evidence of appel-lee’s reliance is the written lease agreement itself. They cite Hott v. Pearcy/Christon, Inc. 663 S.W.2d 851, 855 (Tex.App.-Dallas 1983, writ ref’d n.r.e.), for its holding that reliance solely on a written contract is insufficient to support a fraud claim. The Hott opinion cites no authority for its holding, and it has not been cited in any subsequent decision for the proposition it states.

We decline to follow Hott. We hold the executed lease agreement, containing the promise of appellants as lessees to pay rental escalation charges, is sufficient to support the jury finding of reliance. See Dodson v. Sizenbach, 663 S.W.2d 13 (Tex.App.-Houston [14th Dist.] 1983, no writ). We overrule points of error two and three.

In points of error four through seven appellants challenge the legal and factual sufficiency of the evidence to support the jury findings that appellants did not intend to pay the rental escalation charges at the time they represented to appellee that they would make such payments, and that appellants intended appellee to act on the representations to its injury. The gist of appellants’ argument appears to be the lack of direct evidence concerning their state of mind.

Intent may be inferred from subsequent acts after the representation was made. Spoljaric v. Percival Tours, Inc., 708 S.W.2d 432, 434 (Tex.1986). Proof of intent is almost always made by circumstantial evidence. Id, at 434-35; Duval County Ranch Co. v. Wooldridge, 667 S.W.2d 887, 894-95 (Tex.App.—Austin 1984, no writ). To determine intent we look at circumstances under which the promise was made, the relationship and interests of the parties, the nature of the transaction, the failure to perform and the nature of efforts *348 to perform. Duval County Ranch Co. v. Wooldridge, 667 S.W.2d at 895.

The record establishes that appellants failed to pay any rental escalation charges and made no efforts to do so. The evidence also shows appellants denied any obligation to make rental escalation payments. Hennigan stated in his deposition that they knew they were not obligated for escalation payments under the terms of the lease. Additionally, Hebisen testified that the leasing agent informed them not to worry about the escalation charges, that Nassau Development Company would never charge them for it. Fraser testified that he made the decision to withhold the rental escalation payments. There was no testimony from any of the appellants that they had ever intended to make rental escalation payments.

We hold there is sufficient evidence to support the jury findings and overrule points of error four through seven.

In points of error eight and fourteen appellants challenge the award of actual and exemplary damages for fraud. Point of error eight states that the evidence is insufficient to support the jury finding that appellee “suffered any injury as a proximate cause (sic) of its reliance” on appellants’ representations.

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Bluebook (online)
754 S.W.2d 345, 1988 WL 60088, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hebisen-v-nassau-development-co-texapp-1988.