Pamela Adams and Susan Leahy Shaner v. Southwest Studio Corporation, Carl Graves and Lona Diane Graves

Texas Court of Appeals, 8th District (El Paso)·Decided March 5, 2026·No. 08-24-00009-CV·Published

Opinion

COURT OF APPEALS

EIGHTH DISTRICT OF TEXAS

EL PASO, TEXAS

property, an unimproved lot owned by Shaner and his wife, Marguerite. Though it turned out the Shaners were already deceased, Pamela Adams, their daughter, responded to the letter. After Adams visited the property with Carl and Diane Graves, the parties entered into a one-page contract under which Adams agreed to sell the property to the Graveses for $12,000. In the contract, Adams warranted that she had good title in the property and the capacity to sell it. She received $100 in earnest money. The parties disagree about whether Carl Graves informed Adams that he intended to install utilities on the property, find a buyer, and then close on both sales together. Appellees say he did; Appellants say he did not.

After the contract was signed, Carl Graves began improving the property, including clearing the lot and installing a septic system. At some point, Adams disclosed that she owned only a half interest in the property, and the other half belonged to her brother. The contract did not close, and Adams and Susan Shaner 1 eventually sold the property to someone else for $21,000, without compensating the Graveses for the improvements.

B. Procedural background

(1) The 2010 suit

In 2010, the Graveses filed suit against Adams in justice court, asserting a claim for breach

of contract, i.e., failure to sell land when promised and failure to return money and expenses. After a bench trial in October 2011, the Graveses were awarded $100 in damages.

(2) The 2014 suit

Based on Southwest Studio Corporation’s 2 filing of a materialman’s lien in connection with installation of the septic system and other improvements, Adams and Shaner filed this suit in district court in 2014 against the Graveses and Southwest Studio. Adams and Shaner subsequently filed notices of lis pendens on five properties in Horizon City, referencing this suit.

1 Shaner is Adams’s sister-in-law, who inherited the other half interest in the property from Adams’s brother.

2 Southwest Studio Corporation was an entity through which Carl and Diane Graves acquired and developed small tracts of land.

(a) The pleadings

Adams and Shaner asserted claims for unenforceable agreement—no meeting of the minds,

unenforceable agreement—public policy, unenforceable agreement—unconscionability, unenforceable agreement—lack of mutual assent, conversion, fraud by misrepresentation and/or inducement, fraud by nondisclosure, appropriation by theft, deceptive trade practices, fraud in a real estate transaction, negligence and/or gross negligence, and fraudulent lien.

In their original answer, filed in 2014, Appellees asserted a general denial and a counterclaim and motion for sanctions seeking fees, costs, and expenses.

In their second amended answer, filed in 2016, Appellees asserted a general denial, various affirmative defenses, and counterclaims for theft, fraud in a real estate transaction, fraud in the inducement, breach of contract, fraud, fraudulent misrepresentation, unjust enrichment, and quantum merit. In the statement of facts for these counterclaims, Appellees alleged that Adams had signed a contract to sell the property, had been informed it would be resold to a third party at closing, and did not object when informed that a septic system would be installed in the meantime. Appellees further alleged that after the septic system was installed, Adams ignored all requests that she take steps to clear title and close and instead sold the property to someone else. Later in 2016, Appellees nonsuited with prejudice all counterclaims asserted in their second amended answer.

In their sixth amended (live) answer, filed in 2019, Appellees asserted a general denial, verified denials, various affirmative defenses, and counterclaims for fraudulent lien and fraud. In the statement of facts for these counterclaims, Appellees alleged that Appellants filed notices of lis pendens on five properties not involved in the litigation. Appellees alleged that these notices were invalid and fraudulent for several reasons, including that they were “filed in bad faith in an illegal attempt to secure a possible award of money damages.”

In their second amended (live) petition, filed in 2020, Appellants re-asserted the claims set forth in their original petition, asserted various affirmative defenses and special exceptions to the

counterclaims in Appellees’ sixth amended answer, and noted they were also filing a “Notice of Withdrawal of Nonsuit” purporting to withdraw a 2019 nonsuit of all of Shaner’s claims with prejudice.

(b) The trial

In 2023, the case was tried to a jury. The charge included liability questions on six of

Adams’s claims 3 (conversion, fraud by misrepresentation and/or inducement, fraud by nondisclosure, fraud in a real estate transaction, negligence and/or gross negligence, and fraudulent lien), and three of Appellees’ counterclaims (two of their five fraudulent lien counterclaims and their fraud counterclaim). The charge also included attorney’s fees questions for each side.

The jury found Appellees not liable under any of the theories submitted against them and Adams liable under all theories submitted against her. The trial court entered a judgment in accordance with the verdict, awarding Appellees $140,424.74, including $10,000 in statutory damages for each of the two fraudulent lien counterclaims, $20,000 in damages for fraud, $93,100 in attorney’s fees, and $7,324.74 in prejudgment interest. Appellants filed motions to disregard jury findings, for judgment notwithstanding the verdict, to modify the judgment, and for new trial, all of which were overruled by operation of law. This appeal followed.

II. ISSUES ON APPEAL

In stating their issues on appeal, Appellants list seven “legal errors” by the trial court:

1. Legal Error No. 1: Whether the Trial Court should have disregarded the jury’s findings, and signed a judgment notwithstanding the verdict.

2. Legal Error No. 2: Whether the Trial Court should have disregarded the jury’s findings, and entered a judgment for Appellants.

3. Legal Error No. 3: Whether the Trial Court should have modified, corrected and/or reformed the Final Judgment.

3 The styles of both the jury charge and the judgment include only one plaintiff, Pamela Adams, and the bodies of both documents likewise refer by name only to Adams and not Shaner, and mostly use the singular terms “plaintiff” and “counter-defendant.” In contrast, the style and body of the live petition name both Adams and Shaner as plaintiffs and counter-defendants. In addition, counsel for Adams and Shaner referred to “plaintiffs,” not “plaintiff,” in closing argument (counsel for the defendants used both terms. And while Shaner did not attend the trial, Adams testified she was still a party to the suit.

4. Legal Error No. 4: Whether the Trial Court should have granted a new trial in the interest of justice and fairness.

5. Legal Error No. 5: Whether the Trial Court committed legal error in ordering that Defendant Carl Graves . . . may recover any amounts herein, in view of the Suggestion of Death filed on behalf of Carl.

6. Legal Error No. 6: Whether the Trial Court committed legal error in totally disregarding the interests and rights of Plaintiffs . . ., concerning the causes of action raised and asserted in “Plaintiffs’ Second Amended Petition, Request For Declaratory Relief, And Request For Permanent Injunction, And Counter-

Defendants’ First Amended Answer” (“SAP”).

7. Legal Error No. 7: Whether the Trial Court committed legal error in totally disregarding the interests and rights of Plaintiff Shaner, in view of Shaner’s “Notice Of Withdrawal Of Nonsuit With Prejudice Of Susan Leahy Shaner,”

filed on March 2, 2020.

In their argument, Appellants group their contentions under the following headings,

tracking the jury’s findings against them:

a. Lis Pendens on Lot 3, Block 370, Unit Fifty;

b. Lis Pendens on Lot 8, Block 562, Unit Seventy-One;

c. Alleged Damages for Fraud;

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Pamela Adams and Susan Leahy Shaner v. Southwest Studio Corporation, Carl Graves and Lona Diane Graves, (Tex. Ct. App. 2026).

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