Texas Fiduciary Litigator

Texas Fiduciary Litigator

The Intersection of Texas Courts and the Fiduciary field

Court Enforces Trust Even Though The Trust Document Was Missing

Posted in Cases Decided, Texas Court of Appeals

In Gause v. Gause, a son brought suit to affirm the existence of a trust established by his father. No. 03-13-00768-CV, 2016 Tex. App. LEXIS 8138 (Tex. App.—Austin June 29, 2016, no pet. history). The father had executed a will and a trust document. After his death, a child read the documents to the other children and took the documents to her home. The documents later became missing. A child then procured a deed to real property from the mother that was supposed to be in the trust. Another child sued to hold the deed void and to establish the terms of the trust. The trial court ruled that the trust was effective, set forth its terms, and otherwise voided the deed.

The court of appeals affirmed. The court held that a deed or other document is not made ineffective by its destruction or loss. Rather, production of the original document is excused when it is established that the document has been lost or destroyed, and parol evidence of the contents of a writing is admissible if the original has been lost or destroyed. Loss or destruction of the document is established by proof of search for this document and inability to find it.

The court acknowledged that trusts involving real property had to meet the statute of frauds writing requirement, but that rule did not remove a trust from the operation of the general rule for lost documents. The court held that the evidence was sufficient to establish the terms of the trust and its existence.

Interesting Note: Texas cases have dealt with missing contracts and agreements, and similarly hold that the terms of those agreements can be established through parol evidence. For example, in Bank of America, N.A. v. Haag, a depositor created a trust account for his son’s education, but the signature card was lost. 37 S.W.3d 55, 58 (Tex. App.—San Antonio 2000, no writ). Later, his son withdrew all of the money in the account without the depositor’s permission. See id. The depositor testified that he signed a signature card and testified to its contents, i.e., he was the only one on the signature card and that his son was not allowed to withdraw the money. See id. The trial court awarded judgment to the depositor and against the bank. See id. The bank appealed and argued that its statements and after-the-fact documents proved that the account allowed the son to withdraw funds from the account. See id. The court of appeals, however, dismissed this argument:

Bank of America seeks to rely on the account statements that commenced in 1990 as an unambiguous written agreement which the parol evidence rule prohibits from being contradicted or varied by extrinsic evidence. However, the account statements do not evidence the creation of the account, but simply record the information that was transferred to Bank of America’s system from University Savings’ system. The account statements are not the operative legal document that created the account.

Id. at 58. The court of appeals approved the trial court’s admission of Haag’s parol testimony because there was evidence that a signature card existed at one time but was lost. See id. The court stated: “When a written, signed contract is lost or destroyed such that the party seeking to prove or enforce the agreement is unable to produce the written agreement in court, the existence and terms of the written contract may be shown by clear and convincing parol evidence.” Id. (citing EP Operating Co. v. MJC Energy Co., 883 S.W.2d 263, 267 n.1 (Tex. App.—Corpus Christi 1994, writ denied); Chakur v. Zena, 233 S.W.2d 200, 202 (Tex. Civ. App.—San Antonio 1950, no writ); Mark K. Glasser & Keith A. Rowley, On Parol: The Construction and Interpretation of Written Agreements and the Role of Extrinsic Evidence in Contract Litigation, 49 Baylor L. Rev. 657, 734-35 (1997)). The court concluded: “Because the written contractual documents evidencing the creation of Haag’s account were not introduced into evidence, the trial court did not err in admitting Haag’s testimony regarding the terms of the account.” Id. Based on the testimony of the plaintiff, the court affirmed the jury’s verdict that a trust account had been created and that the beneficiary had no right to withdraw the funds as the only person that may withdraw money from a trust account is the person claiming to be the trustee unless that person dies. See id. (citing Tex. Fin. Code Ann. § 65.106(a)). See also Armstrong v. Roberts, 211 S.W.3d 867 (Tex. App.—El Paso 2006, pet. denied) (testimony of bank’s representative regarding contents of missing second page of account agreement was sufficient to support trial court’s finding that account had survivorship effect); In re Estate of Berger, 174 S.W.3d 845, 846 (Tex. App.—Waco 2005, no pet.) (parol evidence admissible to prove contents of a trust agreement); Phillips v. Ivy, No. 10-02-00266-CV, 2004 Tex. App. LEXIS 7539 (Tex. App.—Waco Aug. 18 2004, pet. denied) (a surviving spouse was allowed to admit an “exemplar” CD of the type used during the relevant time to prove the missing document’s terms). Accordingly, missing trust documents, like other contracts, can be established by parol (oral) testimony.

Lost documents do provide a wrinkle to the normal burden of proof. One court held that to prove the contents of a lost bank agreement, the plaintiff has the burden to establish same by clear and convincing evidence. See Bank of America, N.A., 37 S.W.3d at 58. In Phillips v. Ivy, the court of appeals questioned whether the clear and convincing standard should apply to an agreement that does not involve real property. No. 10-02-00266-CV, 2004 Tex. App. LEXIS 7539, at *5-6 (Tex. App.—Waco Aug. 18 2004, pet. denied). In any event, because the jury instructions submitted the case to the jury on a clear and convincing evidence standard without objection by the parties, the court of appeals applied that standard. See id.

Court Affirms Dismissal Of Will Contest Based On Public Policy Arguments Arising From Sexual Abuse Allegations

Posted in Cases Decided, Texas Court of Appeals

In Merrick v. Helter, a daughter who accused her father of sexual abuse attempted to void her father’s will based on public policy grounds. No. 03-14-00708-CV, 2016 Tex. App. LEXIS 8966 (Tex. App.—Austin August 18, 2016, no pet. history).  Two days before the father died, he signed a will that left no property to his only child, the daughter, and explicitly disinherited her. After he died and his will was admitted to probate, the daughter filed a contest seeking to invalidate the will on public policy reasons and clear the way for her to inherit through intestate succession. Her principal theory was that her disinheritance violated “public policy”—namely Texas’s strong public policy against sexual abuse of children. As her factual predicate for that theory, she alleged that her father had abused her sexually while she was a teenager and had disinherited her after she confronted him with those allegations decades later. The executor filed a motion to dismiss under Texas Rule of Civil Procedure 91a contesting whether the daughter’s “public policy” theory would be a viable basis in Texas law for the relief she sought even if her version of the facts were true. The probate court granted the Rule 91a motion and dismissed the daughter’s claim.

The court of appeals first addressed the relatively new Rule 91a motion to dismiss. The court noted that Rule 91a permits a party to “move to dismiss a cause of action on the grounds that it has no basis in law or fact.” Dismissal on a “no basis in law” ground is appropriate “if the allegations, taken as true, together with inferences reasonably drawn from them, do not entitle the claimant to the relief sought.” The court held that whether this standard is met “depends ‘solely on the pleading of the cause of action.’”

The court then moved onto the central issue in the case: whether the daughter could void the will due to public policy reasons. The court noted that the general rule is that a person of sound mind has a perfect legal right to dispose of his property as he wishes and may disinherit an heir if he desires. The daughter relied on authority that certain terms in wills may be deemed unenforceable on “public policy” grounds. She argued that: Texas public policy strongly condemns sexual abuse, particularly sexual abuse of minors, or conduct aimed at concealing or aiding it; that the father used his will and her disinheritance from it as a means of “silencing” her from divulging the sexual abuse and subsequently “punishing” her for confronting him about it; and the will provision disinheriting her runs afoul of the aforementioned Texas public policy, rendering the provision unenforceable.

The court stated that will construction cases dealt with ascertaining the objective meaning of the language actually used within the “four corners of the will,” not from perceptions of the testator’s subjective intent. The court noted that the daughter’s “public policy” challenge was grounded entirely in asserted conditions or limitations that appear nowhere in the will’s text and allegations about the father’s subjective motives in drafting the will as he did. The court also held: “Even if we were to look beyond the will’s ‘four corners,’ Merrick failed to allege facts to support any theory that Cole conditioned Merrick’s inheritance on her remaining silent about the claimed sexual abuse.”

Finally, the court held:

But more critically, Merrick’s arguments erroneously presume that she has any entitlement to an inheritance from Cole in the first instance. On the contrary, as this Court recently observed in Anderson, “a prospective beneficiary’s interest in receiving an inheritance is merely in the nature of an expectancy or hope,” and it was for this reason we held that an inheritance falls short of the type of protected contractual or economic interest whose disturbance could be actionable through the tortious-interference tort. Undergirding that analysis, we explained, was the “perfect legal right” of a testator with sound mind “to dispose of his property as he wishes,” a right that includes, as previously noted, the prerogative of disinheriting an heir if the testator sees fit. Further, as Helter emphasizes, the Legislature has not seen fit either to require testators in Cole’s alleged position either to provide an inheritance for their victim or to proscribe them from disinheriting the victim. The closest the Legislature has come is to authorize probate courts to bar a parent from inheriting from a child (the reverse of the situation here) who dies intestate (whereas here there is a will) where the parent has been convicted or placed on community supervision for certain crimes against that child, including sexual offenses (and no such criminal charges or dispositions occurred here). In the very least, we can say with certainty that the Legislature has not seen fit—at least as of yet—to authorize, let alone require, the recovery Merrick seeks.

The court of appeals affirmed the dismissal, finding that the daughter’s public policy argument found no support in the will, the factual allegations, or the law.

Court Interprets Will’s Residuary Clause To Create A Determinable Fee Simple Estate

Posted in Cases Decided, Texas Court of Appeals

In In re Estate of Morgenroth, a mother died testate with a will that gave specific devises to her two children, a son and daughter. No. 05-15-00777-CV, 2016 Tex. App. LEXIS 7857 (Tex. App.—Dallas July 25, 2016, no pet. history). The will contained a residuary clause:

All the remaining property, real and otherwise, of every kind and description, wheresoever situated, which I may own or have the right to dispose of at the time of my decease, I give, devise and bequeath to my surviving children, TIFFANY DAWN TRESCOTT and BUDDY LEE MORGENROTH, share and share alike, remainder to the survivor of them.

The daughter died ninety days after her mother, and the son took the position that her interest in the residuary estate belonged to the son. In the estate, the son filed a motion to interpret the will, and the parties filed competing motions for summary judgment requesting the court to determine whether the son was the sole heir to mother’s estate. The trial court construed the mother’s will as creating a life estate for daughter and son “during their lives, with any property of the Estate of [Mother] still in existence upon the death of the first of [Daughter] and [Son] to pass to the survivor of them.” The daughter’s spouse appealed.

The court of appeals described the difference between a determinable estate and a life estate:

A “fee simple absolute” is an estate over which the owner has unlimited power of disposition in perpetuity without condition or limitation. An “executory limitation” is an event which, if it occurs, automatically divests one of devised property. A fee simple estate subject to an executory limitation is called a “determinable fee simple estate.” This is a fee simple interest in every respect, except that it passes to another if the contingency happens. The recipient upon the contingency’s happening has an “executory interest.” A life estate is created by words showing intent to give the right to possess, use, and enjoy the property during life. There can be no life estate in property, real or personal, without a remainder. It may not be necessary always to name the remainderman, in which case the law would define him. But in such case the will must clearly and unequivocally provide for a life estate, thus to overcome the presumption that the testator intended to give the greater estate. Additionally, the life tenant may expressly be given unlimited power to dispose of the property during his lifetime; if such power is exercised, it defeats the remainderman’s interest in the disposed-of property. However, the life tenant may not devise any of that property that remains at her death. No particular language is required to make a life estate.

Id. The court construed the will to read that the mother intended to devise a one-half fee simple determinable interest to both son and daughter, rather than a life estate:

Because the residuary clause does not clearly and unequivocally provide a life estate, there is insufficient evidence to overcome the presumption that Mother intended to give her residuary in fee simple—the  greater estate… The second phrase, “remainder to the survivor of them,” clearly gives whatever interest Son or Daughter still holds in the residue to the other when the first one of them dies. The occurrence of this “executory limitation”—the event in which either sibling predeceases the other while holding any interest in the residue—automatically divests the predecessor of the remaining devised property and the surviving sibling—giving the surviving sibling an executory interest. To read these two phrases together—without nullifying the second phrase and while preserving the greatest estate possible in the first phrase—is to construe Mother’s devise to Son and Daughter as a determinable fee simple.

Id. The court concluded that the son held an executory interest in daughter’s share of mother’s residue; the contingency was daughter predeceasing son with some of mother’s residual estate. Because the daughter died before son while still holding a one-half interest in mother’s residue, the court determined that the son took that property.

Court Grants Mandamus Relief To Void Order Naming An Executor More Than Three Years After Admitting Will To Probate As A Muniment Of Title

Posted in Cases Decided, Texas Court of Appeals

In In re Squyres, in 2012, Baker filed with the probate court an application to probate a will as a muniment of title. No. 01-16-00236-CV, 2016 Tex. App. LEXIS 8509 (Tex. App.—Houston [1st Dist.] August 9, 2016, no pet. history). The probate court signed an order admitting the will to probate as a muniment of title, and specifically found that “there are no unpaid debts owing by this Estate, exclusive of any debt secured by liens on real estate” and that “there is no necessity for administration of this Estate.” In 2015, Baker filed an application for the probate court to issue letters testamentary and appoint her as independent executor of the estate, and though she acknowledged that the probate court had already admitted the will to probate as a muniment of title, she alleged: “Since the will was admitted to probate as a muniment of title by this Court, Applicant has learned of potential claims due the Estate. There is a necessity for an administration of the Estate so that such claims may be further investigated.” The court granted her application and appointed her executor. Baker’s sister received notice of this order and filed a motion for reconsideration, alleging that the probate court did not have jurisdiction to grant the application. The probate court denied the motion for reconsideration, and the sister filed a petition for writ of mandamus.

The court of appeals first addressed the finality of probate court orders. The court stated that “a probate order is the ‘functional equivalent’ of a final judgment when it finally disposes of a particular issue between parties.” “Thus, the probate court’s plenary power to vacate, modify, correct, or reform a final order expires 30 days after it is signed.” The court acknowledged that a probate court retains jurisdiction over the administration of an estate until that estate is disposed of, but “that continuing jurisdiction does not alter the court’s plenary power over final judgments.” One exception to this finality rule is found in Estates Code Section 55.251(a), which provides that “[a]n interested person may, by a bill of review filed in the court in which the probate proceedings were held, have an order or judgment rendered by the court revised and corrected on a showing of error in the order or judgment, as applicable.” Id. (citing Tex. Est. Code Ann. § 55.251(a)). However, a bill of review “may not be filed more than two years after the date of the order or judgment, as applicable.” Id. The court held that the 2012 order admitting the will to probate as a muniment of title finally disposed of all issues in the proceeding and was a final and appealable judgment. Moreover, the order appointing Baker as executor was filed more than three years after the probate court’s plenary power expired and more than a year after the deadline for filing a bill of review. Accordingly, the court of appeals held that the probate court had no jurisdiction to name Baker executor and granted mandamus relief to the sister.

Court Reverses Summary Judgment On Breach Of Fiduciary Duty Claim Against Corporate Director

Posted in Texas Court of Appeals

In E&E Serv. & Supply v. Ruddick, a corporation sued a former employee who formed a competing business. No. 11-14-00055-CV, 2016 Tex. App. LEXIS 7514 (Tex. App.—Eastland July 14, 2016, no pet. history). The trial court granted summary judgment for the employee based on the alleged absence of any evidence of a fiduciary duty.

The court of appeals reversed because the employee had served as an officer and director of the corporation in 2008, and, under corporate bylaws, may have continued to serve during the operable time period because, although she was not reappointed as a director, the bylaws provided that a director would continue to serve until a replacement was appointed and a replacement was not appointed until after the relevant time period. The court concluded: “At a minimum, the summary judgment evidence raises a fact question that Ruddick continued to serve as a director or as an officer until her successor was appointed in April 2011. Thus, the trial court erred when it granted summary judgment with respect to whether or not Ruddick owed a fiduciary duty based upon her status as a director and officer of E & E.” Id.

The court of appeals also held that a traditional summary judgment was in error regarding damages because the employee did not negate all of the damages recoverable for a breach of fiduciary duty. The court noted that “The damages available for a breach of fiduciary duty are quite broad.” Id. Further, the court held that “courts may disgorge all ill-gotten profits from a fiduciary when a fiduciary agent usurps an opportunity properly belonging to a principal, or competes with a principal.” Id. Therefore, the court concluded that the “damage grounds do not negate all of the damages recoverable for a breach of fiduciary duty because they do not address any profits or gains received by” the employee or her new employer.” Id.

Court Affirms Order Requiring Partition of Property Where Fiduciary’s Homestead Argument Failed

Posted in Texas Court of Appeals

In Byrom v. Penn, Byrom was appointed executor of his mother’s estate, and he was later removed as executor for breach of fiduciary duty by using estate funds to build a house for himself. No. 12-15-00033-CV, 2016 Tex. App. LEXIS 7680 (Tex. App.—Tyler July 20, 2016, no pet. history).  The court imposed a constructive trust in the amount of $200,000.00 on Byrom’s home.  Later, a different court rendered an order authorizing a receiver to sell the home, pay fees and expenses, deposit the balance of funds, not to exceed $200,000.00, into the registry of the court, and pay any remaining funds to Byrom and the other two co-owners, Dimple Byrom and Dorothy Berry. Byrom and his wife, Dimple, appealed and argued that the order of sale was void because it violated their constitutional and statutory homestead rights.

The court of appeals affirmed.  The court held that “the homestead and exemption laws of this state are not ‘the haven of wrongfully obtained money or properties’” and “the homestead protection afforded by the Texas Constitution was never intended to protect stolen funds.”  Id. Regarding Byrom, the court concluded: “Because the record indicated that Byrom had paid for the construction of the home with money he wrongfully obtained from his mother’s estate, he was not entitled to use the homestead law to his advantage.” Id. Further, regarding Dimple, the court concluded: “A wife cannot acquire homestead rights in property held in trust by her husband that defeat or impair the rights of the beneficiary of the trust. Accordingly, Dimple had no homestead rights in the property.” Id.

Court Affirms Judgment Against Executor That Deeded Estate Property To Himself

Posted in Cases Decided, Texas Court of Appeals

In In the Estate of Montemayor, the trial court entered summary judgment for an estate beneficiary on a claim to quiet title as against the independent executor, who had deeded estate property to himself. No. 04-15-00397-CV, 2016 Tex. App. LEXIS 7616 (Tex. App.—San Antonio June 1, 2016, no pet. history). The executor appealed, and the court of appeals affirmed. On appeal, the executor argued that the trial court erred by granting the motion for summary judgment because his affidavit allegedly raised a fact issue that when he sold and conveyed the property to himself, he had the authority to do so. The court of appeals noted that a personal representative of an estate may not purchase any estate property sold by the representative or any co-representative of the estate. The court also noted that there is an exception for when the will authorizes such a sale. The court concluded that: “It is undisputed that Montemayor was the independent executor of Luisa’s estate when he deeded the property to himself. The will did not authorize Montemayor to purchase the estate property. Therefore, Calentine established Montemayor’s claim to the property was invalid or unenforceable.” Id. The trial court correctly granted summary judgment, declaring the deed void and quieting title in the new representative of the estate.

Court Reverses Judgment Dismissing Breach Of Fiduciary Duty Claim Because No-Evidence Summary Judgment Motion Was Not Sufficiently Specific

Posted in Cases Decided, Texas Court of Appeals

In Tex v. Iom, a former employer sued a former employee based on a covenant not to compete and breach of fiduciary duty and sued the new employer for tortious interference. No. 12-14-00254-CV, 2016 Tex. App. LEXIS 7317 (Tex. App.—Tyler July 12, 2016, no pet. history). The defendants filed a no-evidence motion for summary judgment, and regarding breach of fiduciary duty, the motion stated: “Plaintiff presents no evidence of breach of fiduciary duty while employed.” It later stated: “Plaintiff also brings a cause of action for breach of fiduciary duty, yet again does not bring forth any evidence of such a breach during the time of his employment (Exhibit 1). Defendant seeks summary judgment that Defendant did not breach his fiduciary duty while employed at Plaintiff.” The trial court granted the motion, and the plaintiff appealed.

The court of appeals noted that a no-evidence motion for summary judgment must state the elements as to which the movant contends there is no evidence. The court held that “[t]he motion must be specific in challenging the evidentiary support for an element of a claim or defense; conclusory motions or general no evidence challenges to an opponent’s case are not authorized.” Further, the court noted that if the motion is not specific in challenging a particular element, the motion is legally insufficient as a matter of law and may be challenged for the first time on appeal. Reviewing the motion in the case, the court held that it was too conclusory:

Rather, Pierce makes only a general argument that NeuroTex has no evidence to support its breach of fiduciary duty cause of action. Thus, we hold that Pierce’s no evidence motion is legally insufficient with regard to breach of fiduciary duty and the trial court’s order granting Pierce’s no evidence motion for summary judgment on that cause of action was erroneous.

Id. at *50.

Interesting Note: No-evidence summary judgment motions can only be filed when a party’s opponent has the burden of proof on a claim or defense. Normally, a plaintiff has the burden of proof on a breach of fiduciary duty claim, and a defendant can properly file a no-evidence motion on that claim. However, there are circumstances – where the fiduciary enters into a transaction with the principal – where the burden is on the defendant/fiduciary to establish that the transaction is fair. In that circumstance, a defendant should not be able to file a no-evidence motion and should have to file a traditional motion for summary judgment. Further, Texas Rule of Civil Procedure 166a(i) only states that a no-evidence motion has to be specific regarding the elements of a claim that are being challenged. So, a movant should not have to challenge any particular underlying facts. Therefore, the opinion’s unnecessary statement that a “motion must be specific in challenging the evidentiary support for an element,” is doubtful. For example, a no-evidence motion that states “The plaintiff has no evidence to support the element of the existence of a fiduciary relationship of his claim for breach of fiduciary duty” should be sufficient. Of course, an attorney should draft a no-evidence motion to be persuasive, and a persuasive motion will have more detail and argument than the example given.

Court Affirmed Award of Prejudgment Interest On Fee Forfeiture Award

Posted in Cases Decided, Texas Court of Appeals

In Holliday v. Weaver, clients obtained a fee forfeiture award against an attorney for breach of fiduciary duty related to the improper use of settlement proceeds. No. 05-15-00490-CV, 2016 Tex. App. LEXIS 7264 (Tex. App.—Dallas July 7, 2016, no pet. history). After a bench trial, the trial court found for the clients and further found that the appropriate remedy for the attorney’s breach of fiduciary duty was “complete disgorgement of Holliday’s fee including certain expenses” which totaled $10,786.84. The trial court also awarded almost $3,000 in prejudgment interest on the fee forfeiture award, and the attorney appealed.

The court of appeals affirmed the prejudgment interest award. The court held that “[i]nterest is awarded as compensation for the loss of use of money” and that “[i]t is intended to fully compensate the injured party, not to punish the defendant.”  “An award of prejudgment interest may be based on either an enabling statute or general principles of equity.” Further, the court held that there is no statute authorizing an award of prejudgment interest on amounts recovered for breach of fiduciary duty. Therefore, the court held that “[w]here no statute controls, the decision to award prejudgment interest is left to the sound discretion of the trial court.”

The attorney argued that prejudgment interest may not be awarded on fee forfeiture awards because those are allegedly not compensatory damages. The court disagreed and held that “[w]here there has been a clear and serious violation of a fiduciary duty, equity dictates not only that the fiduciary disgorge his fees, but also all benefit obtained from use of those fees,” which included prejudgment interest. The court concluded: “Because the award of prejudgment interest in this case fits the purpose of such interest, which is to fully compensate the Weavers, we conclude the trial court did not abuse its discretion in granting the award.” The cited the following cases for further support: Dernick Res., Inc. v. Wilstein, 471 S.W.3d 468, 487 (Tex. App.—Houston [1st Dist.] 2015, pet. filed) (allowing prejudgment interest on fee forfeiture award in a trustee’s breach of fiduciary duty case); Lee v. Lee, 47 S.W.3d 767, 800 (Tex. App.—Houston [14th Dist.] 2001, pet. denied) (same).

Court Voided Judgment Based On Family Settlement Agreement Where Party Revoked Consent

Posted in Cases Decided, Texas Court of Appeals

In In re Estate of Spiller, a party appealed an order admitting a will to probate and ordering the independent administrator to distribute the estate in accordance with a family settlement agreement. No. 04-15-00449-CV, 2016 Tex. App. LEXIS 6811 (Tex. App.—San Antonio June 29, 2016, no pet. history). Earlier in the case, there was a will contest on the basis of mental competence and undue influence. The parties then went to a hearing and announced that they had settled the dispute and read the family settlement agreement into the record. The parties then had disputes about what some of the terms of the settlement meant. One party filed a motion to enter a judgment based on the agreement, and the other party objected to the judgment stating that the agreement was not final. The trial court then entered an order based on the agreement.

The court of appeals reversed the order and held that it was void. The court held that a “party may revoke its consent to a settlement agreement at any time before judgment is rendered on the agreement.” Id. Further, a “judgment rendered after one of the parties revokes his consent is void.” Id. The court noted that the trial court stated that it approved the family settlement agreement and “will sign an order” admitting the will to probate in accordance with the agreement. The court of appeals held that in using the future term “will,” the trial court expressed an intention to render the order in the future. Id. The court concluded:

Willman, however, revoked his consent to the family settlement agreement before any order was subsequently rendered. Because the trial court rendered the order admitting the 2006 will to probate and ordering the distribution of the estate in accordance with the family settlement agreement after Willman revoked his consent to the family settlement agreement, the trial court’s order is void.

The court of appeals noted that whether the family settlement agreement was an enforceable contract and would support a breach of contract claim was not before the court. Id. (citing S & A Rest. Corp. v. Leal, 892 S.W.2d 855, 857 n.1 (Tex. 1995) (noting party revoking consent to settlement agreement could be sued for breach of the settlement agreement)).  Accordingly, on remand, the party seeking to enforce the agreement can file a breach of contract claim and attempt to enforce the agreement after an adjudication of that claim.

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