Tower Contracting Co. v. Central States, Southeast & Southwest Areas Pension Fund

581 S.W.2d 724, 1979 Tex. App. LEXIS 3499
CourtCourt of Appeals of Texas
DecidedApril 18, 1979
DocketNo. 19805
StatusPublished
Cited by2 cases

This text of 581 S.W.2d 724 (Tower Contracting Co. v. Central States, Southeast & Southwest Areas Pension Fund) 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
Tower Contracting Co. v. Central States, Southeast & Southwest Areas Pension Fund, 581 S.W.2d 724, 1979 Tex. App. LEXIS 3499 (Tex. Ct. App. 1979).

Opinion

GUITTARD, Chief Justice.

In this suit for damages for wrongful foreclosure and for tortious interference with negotiations to avoid the foreclosure, the court rendered judgment for defendants on the jury’s verdict. Plaintiff appeals, contending that the trustee’s sale was wrongful as a matter of law because the notice of sale was posted in violation of a temporary restraining order. We hold that plaintiff is not entitled to recover damages on this ground because it obtained the temporary restraining order on obviously insufficient grounds and then agreed that the trustee was free to proceed with the foreclosure. We hold also that the evidence supports the jury’s negative findings on the other grounds alleged and that the admission of certain evidence was not error. Accordingly, we affirm.

The material facts are undisputed. Plaintiff Tower Contracting Company was the owner of a hotel-office-building complex, subject to a deed of trust securing a promissory note held by the trustees of the Teamsters Pension Fund, whom we shall call the Teamsters. On May 7, 1975, the trustee under the deed of trust notified plaintiff that by reason of plaintiff’s failure to pay monthly installments of principal and interest and failure to pay property taxes, the Teamsters had matured the balance of the note and were causing the property to be posted for a trustee’s sale on June 3.

Plaintiff then sought a temporary restraining order, which was issued on June 2. The sworn petition alleged that plaintiff had requested a moratorium on the principal payments of the loan, that plaintiff had obtained a tentative oral agreement from another lender to advance the funds necessary to pay the taxes before June 3, and that the Teamsters had orally agreed that the trustee’s sale would not be held if the property taxes were paid. The petition also alleged that the prospective lender advised plaintiff on May 30 that the funds would not be advanced, that plaintiff immediately notified the Teamsters’ attorney, who advised that no more time would be granted and that the sale would be held on June 3. The petition alleged that there was insufficient time to file a petition and obtain a hearing and prayed for issuance without notice of an order immediately restraining the trustee from proceeding with the sale.

On presentation of this petition, a district judge signed an ex parte fiat directing the clerk to issue an order restraining the trustee from proceeding further under the deed of trust. The trustee was forbidden to post for sale or to conduct any sale of the land in question prior to a hearing on the application for temporary injunction, which was set for June 12. The trustee obeyed this order with respect to the sale on June 3, but, on June 9, proceeded to post another notice for a sale on July 1. The Teamsters intervened in the proceedings, and on June 12 the parties made and signed a written agreement to dissolve plaintiff’s temporary restraining order. The agreement further provided that plaintiff would not pursue its application for a temporary injunction and that the Teamsters would withdraw an action they had filed for damages for wrongful issuance of the restraining order. Finally, the agreement provided that if a new agreement should not be reached between the parties before July 1, then the trustee “shall be free to proceed with foreclosure of the property in question without intervention or interference” by plaintiff. This agreement was embodied in a formal order signed by all the parties and by the judge on June 16. The trustee then proceeded to sell the property on July 1 in accordance with the notice posted on June 9.

Plaintiff argues that notwithstanding its agreement on June 12, the trustee’s sale was wrongful because the notice of June 9 was void, since it was posted in violation of the temporary restraining order. Plaintiff insists that although the trustee was “free to proceed with foreclosure” if no further agreement should be made by July 1, the agreement of June 12 did not provide that the sale could be made without a valid [727]*727notice to prospective bidders, and that the existence of the temporary restraining order tended to chill the bids and prevent the property from selling at an adequate price. Consequently, plaintiff contends that it is entitled to judgment for damages equal to the difference between the value of the property, as found by the jury, and the balance of the debt at the time of the sale.

We cannot agree that plaintiff is entitled to damages on the theory that no valid notice was posted. The only defect in the notice resulted from the temporary restraining order that plaintiff itself had obtained on obviously insufficient grounds. The petition alleged only that the Teamsters had agreed not to foreclose if plaintiff should pay the taxes by June 3, and that plaintiff expected to borrow the money to pay the taxes, but was notified by the prospective lender on May 30 that the money would not be advanced. Plaintiff makes no pretense in this suit that it had even an arguable ground for a temporary restraining order or a temporary injunction. In its present petition plaintiff alleges simply that it obtained the temporary restraining order “[bjeeause plaintiff’s source for raising the necessary funds was unexpectedly withdrawn.” Plaintiff’s president testified by deposition in the present action that the only reason for obtaining the temporary restraining order was to gain time in the hope that the necessary funds could be raised.

In support of its contention that the sale is void, plaintiff relies on Jackson v. The Praetorians, 83 S.W.2d 740, 741 (Tex.Civ. App.—Dallas 1935, no writ). In that case this court decided that a trustee’s sale held one day after dissolution of a temporary injunction restraining the sale was void on two grounds, first, abandonment of the remedy of non-judicial foreclosure by filing of a counterclaim for judicial foreclosure, and, second, posting of notices in violation of the injunction. There is no suggestion in the opinion that the injunction was originally improper, the ground for dissolution being that the mortgagee had abandoned its remedy of extra-judicial foreclosure. Accordingly, the court set aside the trustee’s sale and permitted the judicial foreclosure action to proceed.

We do not read that opinion as supporting a recovery in a case like the present. We need not determine what result would follow if the property were still in the hands of the Teamsters so that another foreclosure sale could still be held. The present suit is an action to recover damages as a result of the issuance of a temporary restraining order which plaintiff obtained on a petition stating insufficient grounds and which plaintiff voluntarily withdrew after agreeing not to interfere further with the sale.

Plaintiff insists that it complied with its agreement not to interfere with the sale, but that the agreement did not authorize a sale without proper posting of notice. We do not think plaintiff should be heard to claim damages on this ground for two reasons.

First, since plaintiff knew that the temporary restraining order was in force until June 12, but, on that day, withdrew its application for injunction and agreed not to interfere with the sale if no further agreement were made before July 1, that agreement, though not entirely clear on this point, may reasonably be construed as a waiver of any right to contest the validity of a sale on that date on the ground of improper posting. Obviously, the Teamsters and the trustee did so understand it.

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581 S.W.2d 724, 1979 Tex. App. LEXIS 3499, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tower-contracting-co-v-central-states-southeast-southwest-areas-texapp-1979.