MICHAEL LEE WYRICK A/K/A MIKE WYRICK AND GREGORY MICHAEL RUHNKE A/K/A GREG RUHNKE, Appellants
BUSINESS BANK OF TEXAS, N.A., Appellee
Appeal from the 200th District Court Travis County, Texas
Trial Court Cause No. D-1-GN-16-002323
consists of Chief Justice Frost and Justices Christopher and
individual guarantors of a $3 million promissory note appeal
the trial court's summary judgment enforcing the guaranty
in favor of a bank and dismissing the guarantors' tort
claims. In their first two issues, the note guarantors,
appellants Michael Lee Wyrick and Gregory Michael Ruhnke,
contend the trial court erred in granting summary judgment to
the bank, appellee Business Bank of Texas, N.A., (the
"Bank"), because legally sufficient evidence
supports their contract defenses (fraudulent inducement,
negligent misrepresentation, mutual mistake, and equitable
estoppel) and affirmative counterclaims (fraud, tortious
interference, negligence, and gross negligence). We conclude
that appellants lack standing to assert some of their
counterclaims and that the summary judgment evidence does not
raise a fact issue as to the remainder of their counterclaims
and their contract defenses.
their third and fourth issues, appellants challenge the trial
court's permanent anti-suit injunction, which bars
appellants and others, including a company they own, Barquero
Energy Services, LLC ("Barquero"), from initiating
or proceeding with any related claims they may have against
the Bank in any other forum. After careful review of the
record, we conclude the trial court erred in granting the
anti-suit injunction, and we modify the judgment to dissolve
the injunction. We otherwise affirm the trial court's
judgment as modified.
the light most favorable to appellants,  the record
reveals the following pertinent background facts. The Bank
loaned $3, 000, 000 to Barquero for investment in a salt
water disposal well (the "Barquero SWD"), and
Barquero signed a promissory note to the Bank in that amount.
The note promising the loan's repayment specifies as
"security for payment" (1) "an Assignment of
Leases" covering the leasehold interest in the Barquero
SWD and (2) an assignment of interest in Barquero stock and
three life insurance policies. Wyrick signed the note as
managing member of Barquero. The Bank did not sign the note,
though appellants contend the Bank drafted the note's
terms. The Bank's representatives, Ed Lette and Ray
Bearden, assured Wyrick and Ruhnke, another Barquero member,
that the loan would be secured by a valid security interest
in the Barquero SWD lease. By a separate document signed the
same day as the note, the Bank and Barquero agreed to
arbitrate all claims, disputes, and controversies between and
among them arising out of or relating to the loan.
the appellants signed an agreement titled "Unlimited,
Unconditional Guaranty," which provides in relevant
1. Guarantor unconditionally, irrevocably, and
absolutely . . . guarantees to Lender . . . that (a)
the principal of and interest on, and attorneys' fees
provided in, the Note . . . will be promptly paid when due in
accordance with the provisions thereof . . .; (b) all
covenants and agreements of Borrower contained in the Note,
the Assignment, the Debt, and any other instrument, . . .
will be duly and promptly observed and performed and (c) all
additional amounts owing or which hereafter become owing by
Borrower under the terms of the Note, the Assignment, the
Debt, and any other instrument . . . will be promptly paid
2. The obligations of Guarantor shall be
performable without demand of Lender and shall be
unconditional irrespective of the genuineness, validity,
regularity or enforceability of the Note, the Assignment, or
any other circumstance which might otherwise constitute a
legal or equitable discharge of a surety or a guarantor, and
Guarantor hereby waives the benefit of all principles or
provisions of law, statutory or otherwise, which are or might
be in conflict with the terms of this Unconditional Guaranty,
and agrees that the obligations of Guarantor shall
not be affected by any circumstances, whether or not referred
to in this Unconditional Guaranty, which might otherwise
constitute a legal or equitable discharge of a surety or
guarantor. Specifically, to the extent this
Unconditional Guaranty is governed by the laws of the State
of Texas, the Guarantor waives all rights and remedies
accorded by law to guarantors and sureties and further waives
the benefits of any right of discharge under Article 34 of
the Texas Business and Commerce Code and any other rights of
sureties and guarantors thereunder, together with all rights
and remedies under Texas Property Code Sections 51.003 to
51.005, as amended. Without limiting the generality of the
foregoing, the Guarantor hereby waives
diligence, presentment, demand of payment, protest, all
notices (whether of nonpayment, intention to accelerate,
acceleration, dishonor, protest or otherwise) with respect to
the note, notice of acceptance of this Unconditional Guaranty
and of the incurring by borrower of any of the obligations
hereinbefore mentioned, all demands whatsoever, and
all rights to require Lender to (a) proceed against
the borrower; (b) proceed against or exhaust any collateral
held by Lender to secure the payment of the indebtedness or
(c) pursue any other remedy it may now or hereafter have
against the borrower.
3. Guarantor hereby agrees that, at any time or from time to
time, without notice to Guarantor and without affecting the
liability of Guarantor, . . . any security for the Debt may
be modified, exchanged, surrendered or otherwise dealt with
or additional security may be pledged or mortgaged for the
acknowledge signing the guaranties but contend the Bank
assured them that it would execute on the collateral, rather
than pursue the guaranties, in the event of Barquero's
default on the note.
defaulted on the note. However, contrary to what appellants
allegedly were led to believe through the Bank's
assurances, the Bank did not foreclose on the Barquero SWD
but rather sought to enforce the personal guaranties.
Appellants refused to honor their guaranties. According to
appellants, the Bank was unable to foreclose on the
collateral due to a problem of its own making: the Bank
failed to secure all necessary leasehold assignments and
landowner consent to the assignments, as contemplated by the
note. Further, appellants contend, the Bank began operating
as if it were the owner of the Barquero SWD, which interfered
with appellants' ability to sell the well for its true
value or to attract investors. Appellants claim that the
Bank's actions caused them to lose potential investors
and buyers, and negatively impacted their credibility with
Bank sued appellants in Travis County for breach of their
personal guaranties. Appellants answered with a general denial
and asserted affirmative defenses of fraudulent inducement
and negligent misrepresentation. They later amended their
answers to also plead mutual mistake and equitable estoppel.
Appellants filed counterclaims against the Bank, Lette, and
Bearden, alleging fraud, tortious interference with
prospective contracts, negligence, and gross negligence.
Barquero asserted similar cross-claims against the Bank, but
Barquero and the Bank agreed to arbitrate Barquero's
claims pursuant to the arbitration agreement between them.
The trial court signed an agreed order compelling all of
Barquero's claims against the Bank to arbitration, and
severing and abating those claims. Barquero nonsuited its
cross-claims that were subject to the arbitration order.
the parties agreed to arbitrate Barquero's claims in
Travis County, Barquero Fund I, LLC ("Barquero
Fund")-an entity owned by Barquero and ostensibly
controlled by appellants-filed suit against the Bank in
Dimmit County, asserting claims similar if not identical to
those Barquero had asserted against the Bank in Travis
County. The Bank filed a motion for sanctions and for an
anti-suit injunction in Travis County when it discovered
Barquero Fund's lawsuit in Dimmit County.
in the Travis County lawsuit, the Bank, Lette, and Bearden
sought summary judgment against appellants in two similar
motions on both traditional and no-evidence
grounds. In the traditional portion of the motions,
the movants asserted that: (1) appellants are liable for
breach of their guaranties; (2) appellants' affirmative
defenses of fraudulent inducement and negligent
misrepresentation fail for lack of justifiable reliance; (3)
the defense of mutual mistake does not void the guaranties
because appellants assumed the risk of any failure of
collateral;(4) appellants lack standing to bring
counterclaims because those claims belong to Barquero; and
(5) appellants' counterclaims fail because the damages
are speculative. In the no-evidence portion of the motions,
the movants argued that appellants had no evidence of any
required elements of their fraud, tortious interference,
negligence, or gross negligence counterclaims.
filed responses to each summary judgment motion, asserting
that they were not liable on the guaranties due to the
Bank's purported misrepresentations concerning the loan
collateral-i.e., that the Bank had or would obtain a valid
security interest in the Barquero SWD leasehold. Appellants
also asserted that they had standing to assert their
counterclaims, that their damages were based on reasonable
certainty, and that they had substantial evidence supporting
their fraud, tortious interference, and negligence-based
trial court granted partial summary judgment in favor of the
Bank on Ruhnke's guaranty and denied Ruhnke's motion
to reconsider. The court later granted summary judgment in
the Bank's favor on Wyrick's guaranty and signed a
final judgment, which incorporated the partial summary
judgment against Ruhnke. The trial court awarded the Bank
damages of $3 million plus interest, as well as
attorney's fees and costs (including conditional
appellate fees). The trial court also dismissed with
prejudice appellants' counterclaims against the Bank and
granted summary judgment in favor of Lette and
before it signed the judgment, the trial court granted the
Bank's motion for a permanent anti-suit injunction, the
terms of which the court expressly incorporated into the
judgment. The anti-suit injunction barred appellants,
Barquero, Barquero Fund, and all those acting in concert with
them from initiating or proceeding with any related claims
against the Bank in Dimmit County or any other county except
Travis County. We discuss the injunction's terms in more
detail below in connection with appellants' third and
appeal timely followed.
their first two issues, appellants challenge the trial
court's summary judgments in the Bank's favor.
Standard of Review
review de novo a trial court's decision to grant summary
judgment. Ferguson v. Bldg. Materials Corp. of Am.,
295 S.W.3d 642, 644 (Tex. 2009) (per curiam). We consider the
evidence in the light most favorable to the non-movant,
indulging reasonable inferences and resolving doubts in the
non-movant's favor. Cantey Hanger, LLP v. Byrd,
467 S.W.3d 477, 481 (Tex. 2015). We credit evidence favorable
to the non-movant if reasonable fact finders could, and we
disregard contrary evidence unless reasonable fact finders
could not. Mann Frankfort Stein & Lipp Advisors, Inc.
v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009).
no-evidence motion for summary judgment, the movant asserts
that no evidence exists of one or more essential elements of
the claims for which the non-movant bears the burden of proof
at trial. See Tex. R. Civ. P. 166a(i); Timpte
Indus., Inc. v. Gish, 286 S.W.3d 306, 310 (Tex. 2009).
The non-movant then must present more than a scintilla of
probative evidence that raises a genuine issue of material
fact supporting each element contested in the motion. See
Forbes Inc. v. Granada Biosciences, Inc., 124 S.W.3d
167, 172 (Tex. 2003); Wal-Mart Stores, Inc. v.
Rodriguez, 92 S.W.3d 502, 506 & n.4 (Tex. 2002).
More than a scintilla exists when the evidence would enable
reasonable and fair-minded people to reach different
conclusions. Burbage v. Burbage, 447 S.W.3d 249, 259
(Tex. 2014); see also Goodyear Tire & Rubber Co. v.
Mayes, 236 S.W.3d 754, 755 (Tex. 2007). The non-movant
"is 'not required to marshal its proof; its response
need only point out evidence that raises a fact issue on the
challenged elements.'" Hamilton v. Wilson,
249 S.W.3d 425, 426 (Tex. 2008) (per curiam) (quoting
Tex.R.Civ.P. 166a(i) cmt.-1997). Unless the non-movant raises
a genuine issue of material fact, the trial court must grant
summary judgment. Tex.R.Civ.P. 166a(i). But if the non-movant
satisfies its burden of production on the no-evidence motion,
then the court cannot properly grant summary judgment.
See Smith v. O'Donnell, 288 S.W.3d 417, 424
traditional summary judgment movant must show that there is
no genuine issue of material fact and that it is entitled to
judgment as a matter of law. Tex.R.Civ.P. 166a(c);
Fielding, 289 S.W.3d at 848. When a plaintiff moves
for summary judgment on its cause of action, it must
conclusively prove all essential elements of its claim as a
matter of law. Leonard v. Knight, 551 S.W.3d 905,
909 (Tex. App.- Houston [14th Dist.] 2015, no pet.);
Cullins v. Foster, 171 S.W.3d 521, 530 (Tex.
App.-Houston [14th Dist.] 2005, pet. denied). Evidence is
conclusive only if reasonable people could not differ in
their conclusions. City of Keller v. Wilson, 168
S.W.3d 802, 816 (Tex. 2005); see also Appleton v.
Appleton, 76 S.W.3d 78, 83 (Tex. App.-Houston [14th
Dist.] 2002, no pet.). The non-movant has no burden to
respond to a motion for summary judgment unless the movant
conclusively establishes each element of its cause of action
as a matter of law. Rhone-Poulenc, Inc. v. Steel,
997 S.W.2d 217, 222-23 (Tex. 1999).
movant produces evidence conclusively establishing its right
to summary judgment, then the burden of proof shifts to the
non-movant to present grounds for avoiding summary judgment,
Home Loan Corp. v. JPMorgan Chase Bank, N.A., 312
S.W.3d 199, 205 (Tex. App.-Houston [14th Dist.] 2010, no
pet.), including evidence sufficient to raise a genuine issue
of material fact, if the non-movant so contends. See
Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197
(Tex. 1995). If the non-movant relies on affirmative defenses
to defeat summary judgment on the movant's cause of
action, the non-movant must do more than merely plead the
affirmative defense. Lujan v. Navistar Fin. Corp.,
433 S.W.3d 699, 704 (Tex. App.-Houston [1st Dist.] 2014, no
pet.). The non-movant must produce sufficient evidence to
conclusively prove or at least raise a material issue of fact
as to each element of the affirmative defense.
Leonard, 551 S.W.3d at 909-10; see Wiggins v.
Overstreet, 962 S.W.2d 198, 200 (Tex. App.-Houston [14th
Dist.] 1998, pet. denied).
granting summary judgment to the Bank, the trial court
necessarily construed the guaranties. Courts construe
unambiguous guaranty agreements as any other contract, i.e.,
by determining the true intentions of the parties as
expressed in the contract. See Moayedi v. Interstate
35/Chisam Road, L.P., 438 S.W.3d 1, 6 (Tex. 2014). We
examine and consider the entire writing to determine the
parties' intent. See id. We review de novo a
trial court's construction of an unambiguous contract.
Id. No party contends the guaranties are ambiguous.
Appellants' Affirmative Defenses
their first issue, appellants contend the trial court erred
in granting summary judgment in the Bank's favor because
they raised a fact issue on their affirmative defenses of
fraudulent inducement, negligent misrepresentation, mutual
mistake, and equitable estoppel. Appellants do not argue that
the Bank failed to establish conclusively all elements of its
breach of contract claim, and they do not otherwise contest
their liability under the guaranties in the event their
affirmative defenses fail as a matter of law. We agree that
the Bank met its initial summary judgment burden.
Accordingly, appellants bore the burden to bring forward
sufficient summary judgment evidence to raise a fact issue on
each element of their affirmative defenses. Leonard,
551 S.W.3d at 909-10. As we explain, appellants either could
not or did not meet this burden as to each affirmative
Fraudulent Inducement and Negligent Misrepresentation
their live pleading, appellants alleged that the Bank
represented to them that it would obtain a valid security
interest in the Barquero SWD as collateral for Barquero's
note, but that the Bank failed to do so. In support of this
defense, appellants alleged that the Bank's
misrepresentation about the collateral was negligent or
fraudulent and induced them into signing their guaranties. We
begin with the fraudulent inducement defense.
prevent the guaranties' enforcement based on the
Bank's alleged fraudulent inducement,  appellants had to
show among other things that they justifiably relied on the
Bank's representations. JPMorgan Chase Bank, N.A. v.
Orca Assets, G.P., LLC, 546 S.W.3d 648, 653-54 (Tex.
2018); Simulis, L.L.C. v. Gen. Elec. Cap. Corp., 439
S.W.3d 571, 577 (Tex. App.-Houston [14th Dist.] 2014, no
pet.); see also Tex. Black Iron, Inc. v. Arawak Energy
Int'l Ltd., 566 S.W.3d 801, 819-20 (Tex.
App.-Houston [14th Dist.] 2018, no pet. h.) (identifying
reliance as element of fraudulent inducement affirmative
defense). Although justifiable reliance usually presents a
fact question, it may be negated as a matter of law when
circumstances show that the reliance cannot be justified.
See JPMorgan Chase, 546 S.W.3d at 654; Nat'l
Prop. Holdings, L.P. v. Westergren, 453 S.W.3d 419,
424-25 (Tex. 2015) (per curiam) ("[A]s Texas courts have
repeatedly held, a party to a written contract cannot
justifiably rely on oral misrepresentations regarding the
contract's unambiguous terms.") (citing Thigpen
v. Locke, 363 S.W.2d 247, 251 (Tex. 1962)); DRC
Parts & Accessories, L.L.C. v. VM Motori, S.P.A.,
112 S.W.3d 854, 858-59 (Tex. App.-Houston [14th Dist.] 2003,
pet. denied) (reliance on oral representation that is
directly contradicted by express terms of written agreement
not justified as a matter of law).
as a traditional summary judgment movant on its
breach-of-guaranty claim the Bank had no burden to negate
appellants' affirmative defenses,  the Bank's
motion challenged the element of justifiable reliance. The
Bank argued preemptively that the guaranties' written
terms contradict appellants' purported reliance on the
Bank's alleged oral misrepresentation that it had
perfected, or would perfect, its security interest in the
Barquero SWD. Thus, the Bank contends, appellants'
fraudulent inducement defense fails as a matter of law on the
justifiable reliance element. We agree.
guaranties state explicitly that appellants' obligations
would be "unconditional irrespective of the genuineness,
validity, regularity[, ] or enforceability" of the loan
or assignment of the Barquero SWD. By signing the guaranties,
appellants waived "the benefit of all principles or
provisions of law, statutory or otherwise" that
contradict the terms of the guaranties and agreed that their
obligations would not be subject to any legal or equitable
discharges. Appellants further agreed that "any security
for the Debt may be modified, exchanged, surrendered[, ] or
otherwise dealt with," and that in any event the Bank
was not required to proceed first against the borrower or
exhaust any collateral before enforcing the guaranties.
Because the guaranties' express terms make clear that the
Bank could have abandoned or "surrendered" the
collateral altogether, whether the Bank actually secured the
collateral or whether the collateral is actually available is
immaterial. If, for example, the Bank secured the assignments
of leases and then released the collateral, appellants
concede they would be liable on their guaranties. The
guaranties' language places the risk for any failure of
collateral squarely on appellants, not the Bank. Assuming the
Bank's representatives made the statements appellants
attribute to them, appellants could not have relied
justifiably on those statements as a matter of law because
they contradict the unambiguous text of the guaranties that
they admittedly read and signed. See, e.g.,
JPMorgan Chase Bank, 546 S.W.3d at 659-60;
Nat'l Prop. Holdings, 453 S.W.3d at 424-26;
DRC Parts & Accessories, 112 S.W.3d at 858-59.
argument on reliance fails for an additional reason. A party
may not rely justifiably on a fraudulent misrepresentation
when "he knows that it is false or its falsity is
obvious to him." Triesch v. Triesch, No.
03-15-00102-CV, 2016 WL 1039035, at *2 (Tex. App.-Austin Mar.
8, 2016, no pet.) (mem. op.). This rule applies to Wyrick
because at the time he signed his guaranty, he knew that the
Bank did not have a valid assignment of the lease: "I
know that for a fact because the [Bank representatives] told
me they were going to have to go to Mr. Baty to get that.
And I arranged for that to happen." ...