This article covers cases from Volumes 404 through 464 of the South Western Reporter (Third Edition) and federal cases during the same period that the authors believe are noteworthy to the jurisprudence on the applicable subject.
Texas courts continue to see significant challenges to foreclosures from the national single-family mortgage/foreclosure meltdown, including the “show me the note” defense and standing to challenge assignments of deeds of trust. Unfortunately, there is still no consistent message in these cases.
In what seems to be a trend, a number of courts are making incorrect holdings (on assignability of receivables from municipal utility districts) and statements in dicta (the UCC does not govern notes secured by realty). Also, a surprise awaits in a case addressing limitation after a restraining order and temporary injunction.
As in previous years, many cases during the Survey period provide drafting lessons for the practitioner. In one case, the parties relied on industry vernacular to define the remedies available under a purchase and sale contract, but there appeared to be no consensus between the parties, or in the industry at large, on the meaning of the terms used which left the resolution of the matter to the jury. In another case of note, which focused on the difference between a covenant and a condition precedent in a purchase and sale contract, both the majority and dissent relied on the same cases to come to completely different conclusions regarding whether the clause at issue was a covenant or condition precedent. Regardless of whether you are more persuaded by the analysis of the majority or dissent, laid out in more detail below, the message from the case is clear to all practitioners: careful word choice and clear drafting are essential to achieving your intended result.
Also of note, during the Survey period was an issue rarely dealt with by practitioners, the statute of frauds, but which played a key role in the outcome of cases involving the lease of mineral interests, the exercise of options to extend a lease, and the sale of foreclosed assets by a bank.
The most notable decisions during the Survey period came via the Texas Supreme Court. The Texas Supreme Court announced significant decisions in the area of roads via easements by necessity, trespass requirements, and application of premises liability statutory limitations.
J. Richard White, et al., Real Property, 2 SMU Ann. Tex. Surv. 387 (2016)