R. Stephen McNally v. Joseph Guevara and Maria Trevino

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-97-00380-CV

R. Stephen McNally, Appellant

v.

Joseph Guevara and Maria Trevino, Appellees

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 250TH JUDICIAL DISTRICT

NO. 95-09666, HONORABLE JOHN K. DIETZ, JUDGE PRESIDING

DISSENTING OPINION

I respectfully dissent.

Appellant R. Stephen McNally sued Joseph Guevara and Maria Trevino, appellees,

seeking a declaratory judgment that he possessed an easement permitting him and his tenants to

park on a portion of appellees' lot, which adjoins his property. Appellees filed a counterclaim

seeking declaratory relief and attorney's fees. The trial court rendered summary judgment for

appellees, but the order granting appellees' motion did not address the issue of attorney's fees.

McNally perfected this appeal, seeking first to determine if the summary judgment is a final,

appealable judgment. If it is not, McNally asks to have his own appeal dismissed. If it is a final

judgment, he complains that the trial court erred in declaring that the easement document does not

permit him to park on the servient estate.

The majority affirms. I would dismiss the appeal for lack of jurisdiction. If,

however, this Court does have jurisdiction, I would reverse the judgment and remand the cause.

In November 1979, McNally purchased property at 602 Elmwood in Austin for use

as multiple-tenant housing. The purchase included a separate easement "for driveway purposes"

over a portion of the adjacent property at 600 Elmwood. That adjoining property at 600

Elmwood, the servient estate of McNally's easement, is now owned by appellees. The diagram

above, though not to scale, gives a rough idea of the layout of the two properties and the

easement. The practice since the purchase of the property has been for McNally's tenants to park

their cars in the easement area. Indeed, because of the steep grade at the front of the dominant

estate, there is no direct access from the street to the front of 602 Elmwood. In order to have

adequate parking, McNally and his tenants must make use of the driveway easement.

The easement in question was originally created in 1946, when the owner of the

servient estate, appellees' predecessor-in-title, deeded McNally's predecessor-in-title a written

easement "for driveway purposes" for a recited consideration of $750. The easement described

in the deed lies across the back of the servient estate. Containing approximately 971 square feet,

the easement is 18.5 feet wide and crosses the entire lot, which is 52.5 feet in width.

With this easement, the owner of the dominant estate used 602 Elmwood as a

boarding house and ultimately as group housing for a number of students. The student tenants

routinely parked in the deeded easement across the servient estate and were doing so at the time

the subsequent purchasers, Wilhite and Smith, a house renovation and resale partnership, bought

the dominant estate in the late 1970s. Wilhite and Smith also acquired the neighboring property,

600 Elmwood, which was the servient estate for the above easement. Although it was not

immediately realized, their ownership of both the 600 and 602 Elmwood properties extinguished

the easement by merging the estates in common ownership. See Tirado v. Tirado , 357 S.W.2d

468, 473-74 (Tex. Civ. App.--Texarkana 1962, writ dism'd). Nevertheless, Wilhite and Smith

continued to use the driveway behind 600 Elmwood as a parking area for 602 Elmwood.

The renovation partnership sold 602 Elmwood to Dr. John Bateman in 1978, but

the partners retained 600 Elmwood for the time being. Even though the driveway easement no

longer existed at the time of Bateman's purchase, the parties involved understood the purchase of

the property to include the right to park in the driveway behind 600 Elmwood. It was not until

several months later, when they found a potential buyer for the 600 Elmwood property, that

Wilhite and Smith realized that the 1946 easement had been merged out of existence. Faced with

this dilemma, they prepared and signed a new easement. This 1979 deed used exactly the same

wording--"for driveway purposes"--that the 1946 easement deed had used. Consequently, the

driveway continued to be used for the purpose of parking as well as a means of ingress and egress;

Wilhite and Smith, still owning the servient estate, respected the dominant owner's right to park

in the driveway in accordance with their agreement.

In 1992, appellees bought the property at 600 Elmwood. McNally's suit alleges

that, despite the long history of 602 Elmwood residents' parking on the driveway easement,

appellees have attempted to interfere with his parking rights by erecting a "no parking" sign,

threatening to tow his tenants' automobiles, and telling him that he and his tenants have no right

to park on the easement. In response, McNally filed this suit to obtain a declaratory judgment

(and injunctive relief if necessary) that he and his tenants at 602 Elmwood have the right to park

on the driveway easement. McNally claimed a right to park on the driveway easement under the

express terms of the driveway easement and, alternatively, that he had acquired a prescriptive

easement to park in the driveway easement area. Appellees counterclaimed, requesting the trial

court to declare that the driveway easement was for ingress and egress only and did not include

any right to park on the easement; appellees' counterclaim also expressly sought attorney's fees.

Appellees filed a motion for summary judgment. The trial court granted appellees' motion and

rendered summary judgment declaring that the easement "for driveway purposes" did not include

the right to park in the easement area. Although the order granting summary judgment did not

address appellees' request for attorney's fees, McNally perfected this appeal out of an abundance

of caution.

I. Jurisdiction

In his first point of error, McNally requests this Court to determine whether the

summary judgment is interlocutory and to dismiss the appeal if we find the judgment not to be

final. A court of appeals has jurisdiction to consider an appeal only if the judgment is final.

Mafrige v. Ross, 866 S.W.2d 590, 591 (Tex. 1993); Cherokee Water Co. v. Ross , 698 S.W.2d

363, 365 (Tex. 1985). Assumption of appellate jurisdiction over an interlocutory order when not

expressly authorized by statute or rule is fundamental error, which results in the dismissal of the

appeal. New York Underwriters Ins. Co. v. Sanchez, 799 S.W.2d 677, 679 (Tex. 1990).

McNally argues in part that the summary judgment is not final and appealable

because it fails to dispose of appellees' claim for attorney's fees. In that regard, McNally points

out that the judgment does not contain a "Mother Hubbard" clause or its equivalent. (1) Because the

order does not contain a Mother Hubbard clause, it leaves the claim for attorney's fees

unadjudicated.

In order to be a final, appealable summary judgment, an order granting summary

judgment must dispose of all the parties and all the issues before the court. Mafrige, 866 S.W.2d

at 591 . If a summary judgment appears to be final, as evidenced by the inclusion of language

disposing of all claims and parties, it should be treated as final for purposes of appeal. Inglish v.

Union State Bank , 945 S.W.2d 810, 811 (Tex. 1997); Mafrige , 866 S.W.2d at 592 . When the

order contains conflicting indications, finality is to be judged by the trial court's intent as

discerned from the language of the decree, the record as a whole, and, occasionally, the parties'

conduct. Continental Airlines, Inc. v. Kiefer, 920 S.W.2d 274, 277 (Tex. 1996). If the order

does not dispose of all issues and all parties, it is interlocutory and not appealable absent a

severance. Mafrige, 866 S.W.2d at 591 . In the context of a summary judgment, there is no

presumption that the judgment was intended to dispose of all parties and issues. Teer v.

Duddlesten , 664 S.W.2d 702, 704 (Tex. 1984).

In the present case, the relevant order fails to dispose of all issues and parties before

the court and, therefore, is a non-appealable partial summary judgment. First, the order granting

summary judgment does not contain a Mother Hubbard clause or an acceptable equivalent. In

their counterclaim, appellees not only sought declaratory relief that the easement language

excludes parking on the driveway easement, but also expressly requested attorney's fees.

Appellees' motion for summary judgment, however, referred only to the easement claim and did

not mention appellees' claim for attorney's fees. The summary judgment did not dispose of

appellees' claim for attorney's fees and, therefore, did not dispose of that portion of appellees'

counterclaim. Although the order recited that appellees' motion should be "in all things granted,"

the present context limits that language to the claims asserted in the motion. Because the motion

did not request any award of attorney's fees (which the counterclaim sought), the recitation in the

order that the motion was "in all things granted" did not address that claim. Accordingly, the

order was interlocutory. See Harris County Appraisal Dist. v. Johnson, 889 S.W.2d 531, 532-33

(Tex. App.--Houston [14th Dist.] 1994, no writ) ("[B]ecause [appellees'] claim for attorney's fees

was not expressly presented to the court in the motion for summary judgment, the order granting

the motion does not dispose of all claims asserted in the Original Petition and is therefore

interlocutory."); cf. Hood v. Amarillo Nat'l Bank , 815 S.W.2d 545, 547 (Tex. 1991) (summary

judgment interlocutory where trial court expressly reserved question of attorney's fees).

Appellees assert in the alternative that they waived or abandoned their claim for

attorney's fees by omitting it from their motion for summary judgment. They contend the

omission of the pleaded claim from the motion functioned as a waiver, effectively taking it out of

the case, so that the resulting summary judgment was final. This argument is without merit. The

Texas Supreme Court views a claim for attorney's fees omitted from a motion for summary

judgment as still pending, so that a summary judgment granting the motion is interlocutory and

nonappealable. See New York Underwriters, 799 S.W.2d at 678-79 ("In the absence of a special

statute making an interlocutory order appealable, a judgment must dispose of all issues and parties

in the case, including those presented by counterclaim or cross action, to be final and

appealable."). Finally, Rule 166a expressly states that claims not adjudicated on the motion for

summary judgment are preserved for disposition by the trial court after resolution of the motion

for summary judgment. Tex. R. Civ. P. 166a(e). Therefore, the omission of a claim from a

motion for summary judgment is not a waiver of that claim.

When claims or parties are not adjudicated in an order, a final judgment can be

achieved only by severance, dismissal, or nonsuit of the omitted claims or parties. See Farmer

v. Ben E. Keith Co., 907 S.W.2d 495, 496 (Tex. 1995) (appellate timetable begins to run only

upon signing of written order severing, dismissing, or nonsuiting unadjudicated claims or parties).

A severance, dismissal, or nonsuit requires affirmative action taken by the proponent and cannot

finalize an interlocutory judgment until a signed, written order of the court severs or dismisses the

unadjudicated claims or parties. Park Place Hosp. v. Estate of Milo, 909 S.W.2d 508, 510 (Tex.

1995). Despite appellees' assertions on appeal, their claim for attorney's fees was not waived by

its mere omission from their motion for summary judgment, and the record does not reflect that

appellees took any action in the trial court to effect severance or dismissal of that claim. The

order granting summary judgment is not a final judgment. Accordingly, I would dismiss the

appeal for lack of jurisdiction.

II. Merits

Moreover, even if we are permitted to address the merits of this appeal, I disagree

with the majority's affirmance of the judgment. In his third point of error, McNally contends the

trial court erred in granting summary judgment on the basis that "for driveway purposes" in an

express easement absolutely excludes parking. McNally claims that, considering the facts and

surrounding circumstances at the time of the grant, the language of the easement is ambiguous,

thereby rendering summary judgment inappropriate. I agree.

The trial court concluded that McNally's easement is unambiguous because this

Court in Colborn v. Bailey , 408 S.W.2d 327 (Tex. Civ. App.--Austin 1966, no writ), construed

the phrase "for driveway purposes" in an easement to exclude parking. On that basis, the trial

court ruled that it was not permitted to look into the "other facts and circumstances regarding the

parties' intent." This conclusion is erroneous. While this Court held in Colborn that the easement

in question did not include parking, that holding was based on the particular facts of the case.

Indeed, our opinion quoted the rule that "[i]n determining the scope of a grant, the language used,

the situation of the parties, the purposes of the grant and the nature of the subject matter, may all

be considered." Colborn , 408 S.W.2d at 329 (quoting Baer v. Dallas Theater Ctr. , 330 S.W.2d

214, 219 (Tex. Civ. App.--Waco 1959, writ ref'd n.r.e.)). Other cases have followed the

Colborn court's approach to construing easements. See Kearney & Son v. Fancher , 401 S.W.2d

897 (Tex. Civ. App.--Fort Worth 1966, writ ref'd n.r.e.); see also Gerstner v. Wilhelm , 584

S.W.2d 955 (Tex. Civ. App.--Austin 1979, writ dismissed w.o.j.). Accordingly, Colborn does

not support the majority's proposition that an easement "for driveway purposes" can never include

parking.

In general, easements are interpreted in accordance with the rules applicable to

deeds and other written instruments. Armstrong v. Skelly Oil Co., 81 S.W.2d 735, 736 (Tex. Civ.

App.--Amarillo 1935, writ ref'd); Phillips Pipe Line Co. v. Clear Creek Properties, Inc., 553

S.W.2d 389, 391 (Tex. Civ. App.--Austin 1977, writ ref'd n.r.e.). Therefore, the intention of

the parties is of primary importance. Kearney , 401 S.W.2d at 903 . Where an easement exists by

an express grant, its use must be determined by the terms of the grant considered in the light of

surrounding circumstances . Id .

These rules of deed interpretation are virtually identical to those for construing

contracts. In fact, when reciting rules of construction relating to deed interpretation, courts often

cite to contract cases. See Hall v. Lone Star Gas Co. , 954 S.W.2d 174, 176 (Tex. App.--Austin

1997, pet. denied); Stark v. Morgan , 602 S.W.2d 298, 302-03 (Tex. Civ. App.--Dallas 1980,

writ ref'd n.r.e.); Kuehn v. Wishard , 452 S.W.2d 5, 9 (Tex. Civ. App.--Houston [14th Dist.]

1970, writ ref'd n.r.e.).

Tension between the "surrounding circumstances" rule and the parol evidence rule

can be traced back to 1860 in Hunt v. White , 24 Tex. 643 (1860), where the supreme court

declared that "extrinsic evidence of intention, as an independent fact, is inadmissible." Id. at 652 .

With respect to the surrounding-circumstances rule, however, the court went on to say: "But as

he may be supposed to have used language, with reference to the situation in which he was placed

. . . the law admits extrinsic evidence . . . ." Id. See also Bruce M. Kramer, The Sisyphean Task

of Interpreting Mineral Deeds and Leases: An Encyclopedia of Canons of Construction , 24 Tex.

Tech L. Rev. 1 , 15 (1993) (citing Heirs of Watrous v. McKie , 54 Tex. 65 (1880) (holding extrinsic

evidence admissible to show consideration and purpose of agreement); Self v. King , 28 Tex. 552,

554 (1866) (holding that court may read document in light of surrounding circumstances but

cannot hear parol evidence on language used in writing)).

The supreme court has subsequently permitted consideration of surrounding

circumstances in determining the proper construction of a contract where neither party contended

the language was ambiguous. See City of Pinehurst v. Spooner Addition Water Co. , 432 S.W.2d

515, 519 (Tex. 1968). In 1981, in an oil and gas lease dispute, the supreme court sought to

eliminate confusion of its City of Pinehurst holding as to the consideration of surrounding

circumstances, since both parties cited to City of Pinehurst as support for their adverse positions.

See Sun Oil Co. (Delaware) v. Madeley, 626 S.W.2d 726, 732 (Tex. 1981). There the court

stated:

Evidence of surrounding circumstances may be consulted. If, in the light of

surrounding circumstances, the language of the contract appears to be capable of

only a single meaning, the court can then confine itself to the writing.

Consideration of the facts and circumstances surrounding the execution of a

contract, however, is simply an aid in the construction of the contract's language.

Sun Oil , 626 S.W.2d at 731 ; s ee also Birmingham Fire Ins. Co. v. American Nat'l Fire Ins. Co. ,

947 S.W.2d 592, 602 (Tex. App.--Texarkana 1997, writ denied) (analyzing recent precedent and

surrounding circumstances).

This Court, in a recent opinion, relied on Sun Oil to distinguish between

surrounding circumstances and parol evidence for purposes of construing a termination clause in

an employment contract. See Carr v. Christie , 970 S.W.2d 620, 622-623 (Tex. App.--Austin

1998, pet. denied). We held that the atypical circumstances leading to execution of the contract

were not inadmissible parol evidence, but instead should be considered in determining whether the

employee's interpretation was reasonable. Id .

In rejecting the appellee's parol evidence argument, this Court (like the supreme

court in Sun Oil ) quoted Professor Williston's explanation of how courts determine ambiguity:

In interpreting contracts or clauses set forth in 'clear and unambiguous' language,

the courts do not confine themselves to a mere inspection of the document. Before

committing themselves, the courts carefully examine the surrounding

circumstances, prior negotiations, and all other relevant incidents bearing on the

intent of the parties . . . .

Only after a careful and painstaking search of all the factors shedding light on the

intent of the parties, only after 'turning signs and symbols into equivalent realities'

will the court conclude that the language in any given case is 'clear and

unambiguous.'. . .

Id . at 623 (citing 4 Williston on Contracts § 600A (3d ed. 1957)) (citations omitted).

Finally, following the trend of the City of Pinehurst and Sun Oil rulings, the

supreme court, while interpreting an insurance contract exclusion provision, recently reiterated

the correct rule: "While parol evidence of the parties' intent is not admissible to create an

ambiguity, the contract may be read in light of the surrounding circumstances to determine

whether an ambiguity exists." Balandran v. Safeco Ins. Co. of Am. , 972 S.W.2d 738, 741 (Tex.

1998) (citing Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd. , 940 S.W.2d 587, 589

(Tex. 1996), and National Union Fire Ins. Co. v. CBI Indus. , 907 S.W.2d 517, 520 (Tex. 1995)).

As to when the surrounding circumstances rule is applied, the court stated: "If, after applying

these rules , a contract is subject to two or more reasonable interpretations, it is ambiguous." Id .

(emphasis added).

The foregoing decisions are controlling in this case. The trial court was obligated

to consider the surrounding circumstances at the time of the grant to determine whether "for

driveway purposes" was ambiguous. Because it did not, the court erred.

The meaning of McNally's easement rests on interpreting "for driveway purposes"

in light of the surrounding circumstances at the time of the grant (in addition to the language of

the grant itself). Surrounding circumstances include those existing at the time of execution of the

writing, but do not include subsequent conduct of the parties. Sun Oil , 626 S.W.2d at 732 .

Various situations may qualify as surrounding circumstances, depending on the facts of the

particular case. In Sun Oil , for example, the supreme court considered as surrounding

circumstances the bargaining position of the lessors due to the strategic location of their property,

the experience level of the attorney drafting the lease, and the economic value of gas at the time

of execution. Sun Oil , 626 S.W.2d at 732 . In Balandran , the court considered as surrounding

circumstances the promulgation of the policy form, including testimony from a Board of Insurance

hearing and statements from the Board of Insurance to the committee revising the form.

Balandran , 972 S.W.2d at 741-42 . This testimony described the coverage included in the prior

policy form and included statements that the purpose of the reformation was not to make

substantive changes to the form. Id . In Christie , this Court considered as surrounding

circumstances the atypical conditions existing at the time the employment agreement was executed.

Christie, 970 S.W.2d at 622-623 . These circumstances included that the appellee purchased a

business at a reduced price in exchange for the appellee's promise to continue the appellant's

employment. Id .

In the context of easement interpretation, surrounding circumstances have included

the location of the easement on the property and that of the abutting streets at the time of the grant.

Kearney, 401 S.W.2d at 903 . From these circumstances, the Kearney court concluded that there

was no necessity to burden the servient tenement with an easement for ingress and egress when

other access to the abutting streets was easily available. Likewise, the Colborn court considered

the prior use of the easement (which did not include parking), the burden on the servient tenement

(property value was reduced), ownership of the two tracts at the time of the easement, and that

there was no driveway on the dominant tenement. Colborn , 408 S.W.2d at 328-329 .

With respect to McNally's easement, I believe the appropriate surrounding

circumstances include at least the fact that the actual use of the easement at the time of the grant

included parking (similar to Balandran , where the prior policy form included the coverage claimed

by the insured). In addition, other facts might also be subject to consideration: (1) the purpose

of the 1979 grant was to effect the prior usage of the 1946 grant, which apparently had included

parking for more than 30 years (similar to the purpose of the policy reformation in Balandran );

(2) the owner of the dominant estate purchased the property with the understanding that it included

parking and therefore the property was more marketable (similar to the economic conditions of

the oil and gas market in Sun Oil ); (3) the 1979 grant was prepared by a "scrivener" (similar to

the attorney's experience level in Sun Oil ); (4) the location and physical layout of the property,

for example, the steep grade in front of the dominant estate prevented direct access to 602

Elmwood from the street (similar to location of the easement and abutting streets in Kearney ); and

(5) parking on the easement in no way burdens the servient estate (in Kearney and Colborn , the

evidence showed just the opposite to be true).

It is common knowledge that driveways are often used for parking; I therefore

believe the relevant phrase--"for driveway purposes"--is itself ambiguous even without regard

to surrounding circumstances. A consideration of the surrounding circumstances not only

reinforces that conclusion, but categorically settles it. Accordingly, I believe the granting of

summary judgment was erroneous because the proper construction of the instrument involved a

fact issue. See Columbia Gas, 940 S.W.2d at 589 ; Christie , 970 S.W.2d at 622 .

I would dismiss the appeal for lack of jurisdiction. If this Court has jurisdiction,

I would reverse the summary judgment and remand the cause to the trial court.

J. Woodfin Jones, Justice

Before Chief Justice Aboussie, Justices Jones and Kidd

Filed: January 14, 1999

Publish

1. A Mother Hubbard clause usually recites that all relief not expressly granted is denied.

Mafrige v. Ross, 866 S.W.2d 590, 591 (Tex. 1993).

Surrounding circumstances include those existing at the time of execution of the

writing, but do not include subsequent conduct of the parties. Sun Oil , 626 S.W.2d at 732 .

Various situations may qualify as surrounding circumstances, depending on the facts of the

particular case. In Sun Oil , for example, the supreme court considered as surrounding

circumstances the bargaining position of the lessors due to the strategic location of their property,

the experience level of the attorney drafting the lease, and the economic value of gas at the time

of execution. Sun Oil , 626 S.W.2d at 732 . In Balandran , the court considered as surrounding

circumstances the promulgation of the policy form, including testimony from a Board of Insurance

hearing and statements from the Board of Insurance to the committee revising the form.

Balandran , 972 S.W.2d at 741-42 . This testimony described the coverage included in the prior

policy form and included statements that the purpose of the reformation was not to make

substantive changes to the form. Id . In Christie , this Court considered as surrounding

circumstances the atypical conditions existing at the time the employment agreement was executed.

Christie, 970 S.W.2d at 622-623 . These circumstances included that the appellee purchased a

business at a reduced price in exchange for the appellee's promise to continue the appellant's

employment. Id .

In the context of easement interpretation, surrou