James Clifford Walker v. Frederick Lunenberg and Melody Luneberg

• Court: Court of Appeals of Texas
• Decided: October 31, 2023
• Docket: 01-21-00539-CV
• Status: Published

Opinion

Opinion issued October 31, 2023

In The

Court of Appeals For The

First District of Texas ———————————— NO. 01-21-00539-CV ——————————— JAMES CLIFFORD WALKER, Appellant V. FREDERICK LUNENBERG AND MELODY LUNENBERG, Appellees

On Appeal from the 412th Judicial District Court Brazoria County, Texas Trial Court Case No. 102095-CV

OPINION

Appellant James Clifford Walker challenges the trial court’s denial by

operation of law of his motion to dismiss the claims filed against him by appellees

Frederick and Melody Lunenburg. The Lunenburgs filed a suit for breach of

contract and other causes of action against third parties related to the sale of property. While the suit was pending, Walker purchased the property, and the

Lunenburgs amended their pleadings to add Walker to the suit. In their live

pleading, the Lunenburgs sought a declaratory judgment against Walker declaring

the rights and obligations of the parties in relation to the property, and they sought

a judicial foreclosure. Walker then filed a motion to dismiss pursuant to the Texas

Citizens Participation Act (TCPA), arguing that the Lunenburgs’ claims against

him were filed in response to his right to petition, which he exercised in filing his

warranty deed to the property in the county property records. The trial court denied

the motion to dismiss by operation of law.

Walker argues in his sole issue on appeal that the trial court erred in denying

the motion to dismiss. We conclude that the Lunenburgs’ suit was not based on or

filed in response to Walker’s exercise of his right to petition but was filed because

of his ownership interest in the property that was the subject of their suit. Thus, the

TCPA does not apply, and we affirm.

Background

In July 2016, the Lunenburgs sold the property at 16327 Tankersley Drive in

Brazoria County (the Property) to Gilberto Jaimez and Rosvella Flores. In

connection with the sale, the Lunenburgs and Jaimez and Flores executed a “Wrap-

Around Real Estate Lien Note,” a Wrap-Around Warranty Deed with Vendor’s

Lien, and a Wrap-Around Deed of Trust.

2 Approximately one year later, Jaimez and Flores sought financing to pay off

the balloon payment on the note. On July 19, 2017, the Lunenburgs and Jaimez and

Flores entered into an Amended Contract. The Amended Contract recognized that

Jaimez obtained funding from the home lender that was paid to the Lunenburgs in

partial satisfaction of Jaimez and Flores’s obligation under the original note. The

Amended Contract also contained provisions for repayment of a balance of

$130,000 that Jamiez and Flores owed to the Lunenburgs on the original note.

Jaimez and Flores entered into a “renewal and extension” note with the lender on

August 18, 2017, and that document recognized the $130,000 owed to the

Lunenburgs. As part of obtaining the outside financing, the Lunenburgs released

their original lien and deed of trust on August 23, 2017.

Jaimez and Flores purportedly failed to make payments as required by the

terms of the Amended Contract. The Lunenburgs filed the underlying suit on April

5, 2019, and they also filed a lis pendens on the property. The Lunenburgs alleged

that Jaimez made thirteen payments to them under the Amended Contract, but

eventually became unable to make the remaining payments. Jaimez then attempted

to sell the Property. The Lunenburgs sought a declaration regarding their right to

recover under the Amended Contract and the effect of the release of the lien.

On April 23, 2021, the Lunenburgs’ counsel received a communication from

counsel for Walker, the purported third-party buyer of the Property. This prompted

3 the Lunenburgs’ counsel to search the property records, finding a “Wrap-Around

Warranty Deed with Vendor’s Lien” with Walker as grantee and Jaimez and Flores

as grantors. This warranty deed had been executed approximately two years

earlier—after the underlying suit and lis pendens was filed—on April 26, 2019,

and it was filed in the real property records nearly two years later on April 8, 2021.

The Lunenburgs’ search of the property records also revealed a property

owner association lien against the Property that called into question the timing of

Jaimez’s sale of the Property to Walker. The notice of assessment and lien,

executed on December 21, 2020, and filed in the property records January 4, 2021,

showed Jaimez as the property owner, not Walker. The Lunenburgs asserted that

this lien adversely affected their interest in the Property.

On June 8, 2021, the Lunenburgs amended their pleadings to add Walker as

a defendant and to include, among other causes of action, a suit for a declaratory

judgment. They sought a declaration that the release of lien executed on August 23,

2017, did not extinguish the $130,000 that Flores and Jaimez owed under the

Amended Contract. They alleged that they “possess a superior lien to the Property

than that claimed by” Jaimez, Flores, or Walker. The Lunenburgs also sought

“judicial foreclosure against [Jaimez, Flores, and Walker] for recovery of amounts

owed to [the Lunenburgs],” including the principal balance owed under the

Amended Contract.

4 Appended to the Lunenburgs’ pleading were the 2016 sale agreement

between them and Jaimez and Flores, the 2016 lien note, the 2016 warranty deed

with vendor’s lien, and the 2016 deed of trust. They also appended the amendment

to the purchase agreement signed by Jaimez and the Lunenburgs that constituted

the Amended Contract, and the Deed of Trust dated August 18, 2017, in favor of

the home lender that financed the property for Jaimez and Flores in 2017.

Walker moved to dismiss the claims against him pursuant to the TCPA. He

asserted in his motion that he bought the Property from Jaimez and Flores on April

26, 2019, and recorded the warranty deed in the county property records on April

8, 2021. He claimed that the Lunenburgs filed “this action seeking a declaratory

judgment, judicial foreclosure and joint and several liability against Walker for the

filing of the warranty deed with the Brazoria County Clerk’s office.” He argued

that the TCPA applied to this legal action because the Lunenburgs’ suit was based

on his filing of the warranty deed, which he identified as an exercise of his right to

petition. He also asserted that the recording of the warranty deed was a

communication pertaining to a legal proceeding.

The Lunenburgs responded that their suit was a private property dispute.

They further asserted that Walker’s filing of the warranty deed was not the basis of

their claims; rather, their claims were based on a contractual dispute concerning the

Property, and Walker had purchased the Property and filed the warranty deed while

5 the Property was subject to the lis pendens. The Lunenburgs argued that they

added Walker to their ongoing lawsuit because of his interest in the Property, not

because of any particular document that was filed.

The trial court denied Walker’s TCPA motion to dismiss by operation of

law. This interlocutory appeal followed.

TCPA Motion to Dismiss

In his sole issue, Walker complains that the trial court erred in denying his

motion to dismiss the Lunenburgs’ claims against him by operation of law.

Because we conclude that the TCPA does not apply to the Lunenburg’s claims

against Walker, we disagree.

A. Standard of Review & Applicable Law

The Legislature enacted the TCPA “to encourage and safeguard the

constitutional rights of persons to petition, speak freely, associate freely, and

otherwise participate in government to the maximum extent permitted by law and,

at the same time, protect the rights of a person to file meritorious lawsuits for

demonstrable injury.” McLane Champions, LLC v. Houston Baseball Partners

LLC, 671 S.W.3d 907, 913–14 (Tex. 2023) (quoting TEX. CIV. PRAC. & REM. CODE

§ 27.002). “The statute provides this protection by authorizing a motion to dismiss

early in the covered proceedings, subject to expedited interlocutory review.” Id.;

see TEX. CIV. PRAC. & REM. CODE §§ 27.003, .008. In the first step in moving to

6 dismiss under the TCPA, the moving party must demonstrate that the TCPA

applies to the legal action against it. McLane Champions, 671 S.W.3d at 914; TEX.

CIV. PRAC. & REM. CODE §§ 27.003, .005(b). If the movant fails to meet this initial

burden, the motion to dismiss fails. See TEX. CIV. PRAC. & REM. CODE § 27.005(b).

If the moving party satisfies its initial burden, the burden shifts to the nonmoving

party to establish by clear and specific evidence a prima facie case for each

essential element of its claim. See id. § 27.005(c).

We review de novo a trial court’s ruling on a TCPA motion to dismiss.

Landry’s, Inc. v. Animal Legal Def. Fund, 631 S.W.3d 40, 45–46 (Tex. 2021). In

reviewing whether a legal action is subject to or should be dismissed under the

TCPA, we consider the pleadings, evidence a court could consider under Texas

Rule of Civil Procedure 166a, and supporting and opposing affidavits stating the

facts on which the liability or defense is based. TEX. CIV. PRAC. & REM. CODE

§ 27.006(a). “The basis of a legal action is not determined by the defendant’s

admissions or denials but by the plaintiff’s allegations.” Hersh v. Tatum, 526

S.W.3d 462, 467 (Tex. 2017). We view the pleadings and evidence in the light

most favorable to the nonmovant. Kassab v. Pohl, 612 S.W.3d 571, 577 (Tex.

App.—Houston [1st Dist.] 2020, pet. denied).

Whether the TCPA applies is an issue of statutory interpretation that we also

review de novo. USA Lending Grp., Inc. v. Winstead PC, 669 S.W.3d 195, 200

7 (Tex. 2023); S & S Emergency Training Sols., Inc. v. Elliott, 564 S.W.3d 843, 847

(Tex. 2018). In conducting our analysis of the statute, “we ascertain and give effect

to the Legislature’s intent as expressed in the language of the statute.” ML Dev, LP

v. Ross Dress for Less, Inc., 649 S.W.3d 623, 627 (Tex. App.—Houston [1st Dist.]

2022, pet. denied) (quoting State ex rel. Best v. Harper, 562 S.W.3d 1, 1 (Tex.

2018)).

Under the TCPA, a trial court “shall dismiss a legal action against the

moving party if the moving party demonstrates that the legal action is based on or

is in response to . . . the party’s exercise of: (A) the right of free speech; (B) the

right to petition; or (C) the right of association.” TEX. CIV. PRAC. & REM. CODE

§ 27.005(b). The exercise of the right to petition includes any “communication in

or pertaining to . . . a judicial proceeding” or “an official proceeding, other than a

judicial proceeding, to administer the law.” TEX. CIV. PRAC. & REM. CODE

§ 27.001(4)(A)(i), (ii) (internal quotations omitted); Cweren v. Eureka Multifamily

Grp., L.P., 01-21-00470-CV, 2023 WL 2977755, at *14 (Tex. App.—Houston [1st

Dist.] Apr. 18, 2023, no pet.) (mem. op.). And a “[c]ommunication includes the

making or submitting of a statement or document in any form or medium,

including oral, visual, written, audiovisual, or electronic.” TEX. CIV. PRAC. & REM.

CODE § 27.001(1) (internal quotations omitted).

8 B. Analysis

Here, Walker argued that the TCPA applies to the Lunenburgs’ claims

against him because the claims were based on his filing of the warranty deed in the

county records, which was an exercise of his right to petition.

Even if we assume that filing a warranty deed qualifies as a type of

communication that constitutes an exercise of the right to petition, see TEX. CIV.

PRAC. & REM. CODE § 27.001(4)(A)(i), (ii) (providing that exercise of right to

petition includes any “communication in or pertaining to . . . a judicial proceeding”

or “an official proceeding, other than a judicial proceeding, to administer the law”),

Walker has failed to carry his burden to demonstrate that the Lunenburgs’ claims

against him were based on or in response to his filing the warranty deed or other

exercise of his right to petition.

This Court has recently held that “[t]he ordinary meaning of the ‘is based

on’ component denotes a legal action that has the relevant TCPA-protected activity

‘as a main ingredient’ or ‘fundamental part’ of the challenged legal action.” Ernst

& Young, LLP v. Ryan, LLC, No. 01-21-00603-CV, 2023 WL 4239350, at *8 (Tex.

App.—Houston [1st Dist.] Jun. 29, 2023, pet. filed) (mem. op.). “The second

component—‘in response to’—denotes some sort of answer or other act in return.”

Id. Other courts of appeals have explained that a TCPA movant must establish “a

nexus between the rights protected by the statute and [the claims asserted].”

9 Newstream Roanoke 6.125, LLC v. Shore, No. 02-22-00506-CV, 2023 WL

5615871, at *4 (Tex. App.—Fort Worth Aug. 31, 2023, no pet.) (mem. op.);

Apache Corp. v. Apollo Expl., LLC, No. 11-21-00295-CV, 2023 WL 3511262, at

*3 (Tex. App.—Eastland May 18, 2023, no pet.) (mem. op.) (holding that initial

burden under TCPA requires movant to “establish a nexus between the rights

protected by statute and Appellees’ claims,” which they can do by showing that

claim is “factually predicated on the alleged conduct that falls within the scope of

[the] TCPA’s definition” of protected rights); see also ML Dev, LP, 649 S.W.3d at

629 (holding that former version of statute provided that communications that were

“related to” a cause of action fell within TCPA, but TCPA as amended in 2019

requires movants “to establish a closer nexus between the claims against them and

the communications they point to as their exercise of protected rights”).

The Lunenburgs asserted two claims against Walker: a suit for a declaratory

judgment regarding the parties’ rights under the Amended Contract as that relates

to their interest in the Property and a suit for “judicial foreclosure against [Jaimez,

Flores, and Walker] for recovery of amounts owed to [the Lunenburgs],” including

the principal balance owed under the Amended Contract. Neither of these claims

by the Lunenburgs was factually predicated upon Walker’s communication in

filing the warranty deed. The “main ingredient” or “fundamental part” of the

Lunenburgs’ claims for declaratory judgment and judicial foreclosure is the rights

10 and obligations created by the agreements between the Lunenburgs and Jaimez and

Flores. The factual predicate for the Lunenburgs’ suit was the purported breach of

the Amended Contract. The Lunenburgs filed a lis pendens on the Property in

connection with their suit against Jaimez and Flores. When they became aware that

Walker had purchased the Property—which he did after they had filed the

underlying suit against Jamiez and Flores and the lis pendens on the Property—

they added Walker to the suit because of his purported ownership interest in the

Property. Thus, we conclude that the Lunenburgs’ claims against Walker were not

based on or in response to any communication in the warranty deed, but rather, the

claims were based on or in response to Walker’s ownership of the Property at the

center of this dispute.

In reaching this conclusion we observe that, although the warranty deed that

Walker filed in the county property record communicates that he purchased the

Property from Jaimez and Flores, nothing in the Lunenburgs’ pleadings complains

about the content, substance, or communicative nature of the warranty deed. See

Hanna v. Williams, —S.W.3d—, No. 03-22-00254-CV, 2023 WL 5474305, at *5

(Tex. App.—Austin Aug. 24, 2023, pet. filed) (discussing meaning of “based on”

or “in response to” under DTPA and concluding that because pleadings did not

complain about content, substance, or communicative nature of court filings and

discovery requests, but instead about their existence, claims were not based on or

11 in response to exercise of right to petition). The Lunenburgs’ claims invoke the

warranty deed only for its existence and as evidence of Walker’s ownership

interest in the Property. Courts have observed that “there is a distinction between

communications used as evidence to support a claim and claims that are based on

or in response to (i.e., factually predicated upon) those communications.” Id.; see

Apache Corp., 2023 WL 3511262, at *4–5 (determining that references in

plaintiff’s pleading to press release “merely point to evidence in support of

[plaintiff’s] fraudulent transfer claim” but that “press release itself is not a part of

the claim”; noting that “there is a difference between communication that is part of

the claim itself and communication which merely serves as evidence is support of a

claim”); Clinical Pathology Labs., Inc. v. Polo, 632 S.W.3d 35, 46 (Tex. App.—El

Paso 2020, pet. denied) (concluding that employer’s decision to terminate

employee and its termination of him were “at the core of this lawsuit, as distinct

from the several discussions and letters surrounding that decision” and that lawsuit

was thus not factually predicated on TCPA communications). “In truth, almost

every lawsuit at its core is based on some decision, followed by conduct, that is

bracketed by communications in one form or another by or between the parties.”

Polo, 632 S.W.3d at 45.

This Court recently considered a similar case between a retail chain that

sought rights to an easement following the purchase of a tract of land. ML Dev, LP,

12 649 S.W.3d at 625. The retailer sued the sellers to force them to grant easement

rights, and the sellers moved for dismissal on the argument that they were sued

based on or in response to their exercise of the right of free speech and the right to

petition, pointing to statements they allegedly made as they blocked easement

access. Id. We affirmed the trial court’s denial of the TCPA motion to dismiss,

holding that the retailer’s claims were not based on or in response to the

communications denying the easement, but in response to the denial of easement

access. Id. at 629. In doing so, we observed that the pleadings and other evidence

did not “draw an adequate connection [between the communications identified in

the suit and the claims themselves] to invoke the TCPA under the amended

language” because, while the “deleted phrase ‘relates to’ might encompass the

chatter around the denial of easement access,” the remaining statutory language

requiring claims to be “based on” or “in response to” a protected action is “not so

sweeping.” Id.

As in ML Dev, LP, we conclude that the claims against Walker are factually

predicated on his ownership of the Property that is the subject of the dispute about

the Amended Contract between the Lunenburgs and Jaimez and Flores. While the

warranty deed might be a communication relevant to these claims as evidence to

resolve the Lunenburgs’ suit for declaratory judgment and suit for judicial

foreclosure, neither the warranty deed itself nor Walker’s action of filing it is part

13 of any claim asserted against Walker by the Lunenburgs. See id. at 628 (although

alleged statements “may have accompanied” complained-of conduct,

communications themselves did not “provide the basis for the legal claims or the

impetus for suit”); see also Newstream Hotels & Resorts, LLC v. Abdou, No. 02-

21-00343-CV, 2022 WL 1496537, at *2 (Tex. App.—Fort Worth May 12, 2022,

pet. denied) (mem. op.) (“[M]erely alleging conduct that has a communication

embedded within it does not create the relationship between the claim and the

communication necessary to invoke the TCPA.”).

We overrule Walker’s issue on appeal.

Conclusion

We affirm the trial court’s denial by operation of law of Walker’s TCPA

motion to dismiss.

Richard Hightower Justice

Panel consists of Chief Justice Adams and Justices Hightower and Countiss.,