Ski River Development, Inc. v. McCalla

167 S.W.3d 121, 2005 WL 927275
CourtCourt of Appeals of Texas
DecidedJune 7, 2005
Docket10-03-00316-CV
StatusPublished
Cited by131 cases

This text of 167 S.W.3d 121 (Ski River Development, Inc. v. McCalla) 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
Ski River Development, Inc. v. McCalla, 167 S.W.3d 121, 2005 WL 927275 (Tex. Ct. App. 2005).

Opinions

OPINION

BILL VANCE, Justice.

This case concerns a 380-aere piece of property along the Brazos River in John[128]*128son County. Appellees Anthony L. McCalla (“McCalla”) and Cheryl A. McCal-la are lessees of Appellee Walter Baker (“Baker”) under a 1992 lease, known as the “Glazier lease.” Appellants, Ski River Development, Inc. (“Ski River”), Stephen R. Davis (“Davis”), and Karen Davis, are also lessees of Appellee Walter Baker under a 1996 lease, called the “Baker-Davis lease.” In 1996, the McCallas sued the Davises, Ski River,1 and Baker claiming they had a right to purchase the property under the Glazier lease. The McCallas sought specific performance of their exercised option, tortious interference damages (including exemplary), a declaratory judgment that: (1) Mary Baker elected to sell the property; (2) the McCalla’s offer to purchase was sufficient to exercise an option; (3) the Baker-Davis lease is void because it violated the McCalla’s option contract, and for attorney’s fees under the Declaratory Judgment Act.2 Baker cross-claimed against Ski River and the Davises for damages (including exemplary) for tortious interference with use and enjoyment of his land and prospective contractual relations with the McCallas, civil conspiracy, a declaratory judgment that the Baker-Davis lease is void because it was procured by fraud, undue influence, and unconscionability, and for attorney’s fees under the Declaratory Judgment Act.3 Ski River and the Davises counterclaimed for a declaratory judgment that the McCalla’s option is void and unenforceable and for attorney’s fees under the Declaratory Judgment Act.4 A jury awarded damages and attorney’s fees to the McCallas and Baker against the Davises and Ski River and made other findings. The court entered judgment on the jury’s verdict for tortious interference and declared that (1) the McCallas properly exercised their option to purchase and (2) the Baker-Davis lease and its amendments are void and unenforceable. Ski River and the Davises appeal in twelve issues.

We will reverse that part of the judgment that states (1) the Davises and Ski River take nothing against the McCallas and (2) the declaratory judgment that the McCallas properly exercised their option to purchase the Property. We will render judgment that the McCalla’s option to purchase is void. We will further reform the declaratory judgment to provide that the Baker-Davis lease is unconscionable and unenforceable, not void. We will reverse the tortious interference damages, exemplary damages, and all attorney’s fees awarded to the McCallas against the Davises and Ski River. We will affirm the [129]*129tortious interference damages, exemplary damages, and all attorney’s fees awarded to Baker against the Davises and Ski River. We will remand this cause to the trial court to determine whether to award attorney’s fees for the Davises and Ski River under the Declaratory Judgment Act. We will overrule or not address all other issues.

BACKGROUND

Arthur William Glazier, Jr. owned 380 acres of land. In 1992, Glazier entered into a 99-year lease covering the entire property with Appellee Walter Baker and his mother, Mary Baker (the “Glazier lease”). In the Glazier lease, the Bakers sub-leased a two-acre tract to the McCal-las. This sub-lease states in part:

That, in the event Lessees [Bakers] shall purchase or otherwise obtain legal ownership of said Property from Lessor [Glazier] and later elect to sell, Lessees [Bakers] hereby grant Sub-Lessees [McCallas] the First Option to Purchase all, or a portion of said Property from Lessees [Bakers] at market value.

In 1998, Glazier died, leaving the property to Walter and Mary Baker. Soon thereafter, Walter Baker deeded his undivided interest to Mary Baker making her the 100% owner of the property.

In June 1994, Mary Baker signed an exclusive one-year listing agreement with Glenna Calahan to sell the entire 380 acres for $2,500 per acre. The listing agreement stated that Baker “shall not rent or lease the Property during the term of this Listing without the prior written approval of [Calahan]” and “shall not negotiate with any prospective buyer who may contact [Mary Baker] directly, but refer all prospective buyers to [Calahan].” In August 1994, Calahan wrote to McCalla notifying him of the listing of the property at $2,500 per acre and giving him 72 hours to exercise his option to purchase. Four days later, McCalla responded that he desired to pursue his rights under the Glazier lease, including but not limited to, his “option to purchase all, or a portion, of said Property at market value.” He also objected to the insertion of a 72-hour deadline to exercise his option. He further stated:

the option cannot be evaluated until market value of the property has been determined and, as a result, does not have to be exercised until such time that either market value has been determined or a bonafide offer to purchase executed by a third party, has been received by me.

McCalla also requested any information Calahan may have regarding the sale of the property, including any information to establish market value. Seven days later, McCalla again requested the same property information from Calahan. Eight days later, Calahan sent him the MLS information sheet, title commitment, and other information.

In October 1994, the McCalla’s appraisal was completed, which stated the value to be $1,200 per acre. This value was not disclosed to the Bakers or Calahan. Later in October, Coyt Randal Johnston, on behalf of McCalla, sent a letter to Calahan stating that they were working on a proposal to purchase the property and had secured an appraisal to help evaluate the “current offer of $2,500.00 per acre.” He further stated:

... [McCalla] and I have determined that it is in our best interest not to make an offer for the property at this time, since we do not want to run the risk of offending you or the Bakers with an offer that is unacceptably low.
I want to emphasize that we continue to be interested in the property and will continue to evaluate our position as time [130]*130goes on. We believe, however, that Walt and Mary should have the opportunity to try to sell this property to someone who is willing to pay their purchase price.
Should another buyer submit a contract on the property, [McCalla] will, of course, review the matter in connection with his right of first refusal at that time. In that regard, you should be aware that nothing in this letter is intended to waive or alter any of the rights or obligations between the Bakers and [McCalla] in connection with their various contractual and lease agreements.

In April 1995, Mary Baker reduced her asking price to $1,950 per acre. Later in 1995, Davis contacted Calahan to inquire about purchasing 25 acres of the property at $1,800 per acre, but Mary Baker declined this offer because she wanted .to sell the entire 380 acres. In October 1995, Mary Baker increased her asking price to $2,100 per acre.

As early as December 15, 1995, Walter Baker was referring to Stephen Davis as his “money man.” In 1996, the Davises friendship with the Bakers increased, and they visited them on a weekly basis.

On January 29, 1996, the Davises presented a “general business plan” for development of the property to a potential investor.

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Cite This Page — Counsel Stack

Bluebook (online)
167 S.W.3d 121, 2005 WL 927275, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ski-river-development-inc-v-mccalla-texapp-2005.