                 NUMBER 13-16-00496-CV

                   COURT OF APPEALS

            THIRTEENTH DISTRICT OF TEXAS

              CORPUS CHRISTI - EDINBURG


ELAYNE MATTAR, INDIVIDUALLY;
J&E EUBANKS, INC.; ELAYNE MATTAR,
TRUSTEE OF THE JAMES E. EUBANKS
AND VIRGINIA L. EUBANKS FAMILY
TRUST; MARK MAXIMILLIAN MILAM,
INDEPENDENT EXECUTOR OF THE
ESTATE OF JAMES E. EUBANKS,
DECEASED; AND MARK MAXIMILLIAN
MILAM, INDEPENDENT EXECUTOR OF
THE ESTATE OF VIRGINIA L. EUBANKS,
DECEASED,                                             Appellants,

                              v.

BBVA COMPASS BANK, NA,                                 Appellee.


            On appeal from the 103rd District Court
                 of Cameron County, Texas.


                 MEMORANDUM OPINION
             Before Justices Rodriguez, Contreras, and Hinojosa
                Memorandum Opinion by Justice Rodriguez
       This lawsuit concerns a loan issued to George and Virginia L. Eubanks by appellee

BBVA Compass Bank, NA (“the Bank”).1 The loan was secured by land associated with

the Eubanks family farm in south Texas. Appellants are Virginia’s descendants and

various entities formed by members of the Eubanks family (collectively, “the Eubanks”). 2

       The Eubanks filed suit against the Bank challenging the family’s loan obligations

and alleging tortious conduct. Pursuant to a jury verdict, the trial court rendered a take-

nothing judgment in favor of the Bank and awarded the Bank attorney’s fees. By nine

issues, the Eubanks challenge the judgment. We affirm in part and reverse and remand

in part.

                                       I.      BACKGROUND

       The loan that is the subject of this appeal initiated as a short-term loan in December

2004, in the amount of $1,775,000. The loan was renewed several times over the years,

and Virginia pledged her land as collateral for the renewals. The most recent renewal

occurred in 2008, at which time Virginia again executed a deed pledging her land as

collateral (together, “the 2008 note”). Virginia passed away in 2008, and her daughter

Elayne Mattar began making payments to the Bank.




       1 The loans in this case were originated and maintained by Texas State Bank, which later merged
with BBVA Compass Bank. We refer to Texas State Bank and all predecessor entities as “the Bank.”
        2 Appellants are the family’s corporation J&E Eubanks, Inc.; Elayne Mattar, who filed suit

individually and as trustee of the James E. Eubanks and Virginia L. Eubanks Family Trust; and Mark
Maximillian Milam, who filed suit as independent executor of the estate of James E. Eubanks (“Jim”),
Deceased and the estate of Virginia L. Eubanks, Deceased.
                                                  2
       After the Bank attempted to foreclose on the family land, the Eubanks filed suit,

challenging the validity of the Bank’s security interest in the family land. They alleged

that the Bank violated its special duty of good faith and fair dealing to Virginia, whom they

described as an elderly, vulnerable widow, whose love for her ailing son George was

exploited by the Bank.      The Eubanks also alleged that the 2008 note:            (1) was

unconscionable; (2) had already been released; and (3) was executed without authority.

The Eubanks’ suit was tried before a Cameron County jury in 2016.

A.     The Bank’s Witnesses

       1.     Tim Gilles

       Tim Gilles testified that he met the Eubanks in 1980, and handled their borrowing

as a vice president and later as president of the Bank’s predecessor. Gilles testified that

Virginia, her husband Jim, and their son George ran a successful farming operation

through the family’s corporation J&E Eubanks, Inc.            Jim handled the decisions

concerning planting and harvesting, and Virginia handled crop sales and financing.

Virginia held a college degree and was a realtor. According to Gilles, the operation was

so profitable that Jim was sometimes able to finance the considerable expenses of

running the farm without the Bank’s assistance, and the Eubanks—through their family

corporation—acquired several hundred acres of land in south Texas. In the event of an

occasional crop failure or financial shortfall, the Eubanks would obtain a loan from the

Bank, which would be paid off over the course of several seasons. Gilles testified that

the Bank viewed the Eubanks as a sound investment, due to their thirty-year record of

success.


                                             3
        According to Gilles, Jim became ill at some point in the 1990’s and retired from the

farm, leaving George and Virginia in charge. Jim passed away in 2004, at which point

Virginia became president of the family’s corporation and executor of Jim’s estate.

        Gilles testified that between 2003 and 2004, George suffered personally from his

father’s death, as well as from a costly divorce, a serious car accident, and the failure of

two crops. Gilles also testified that Elayne described her brother George as having an

alcohol problem.

        Gilles further testified that near the end of 2004, George and Virginia approached

him about obtaining a sizeable loan to consolidate the Eubanks’ debts and to provide

funds for the next year’s farming. The Bank was amenable, and it approved the first loan

for $1,775,000 in December 2004. 3 Gilles testified that the majority of the loan was

dedicated to paying George’s debts, both business and personal. George and Virginia

brought bills, taxes, and debts to the Bank, which the Bank paid with draws from the loan.

        The loan became due in early 2005. It was described as a “bridge loan”—that is,

a loan for a short period of time until a longer-term loan could be arranged. George

renewed the bridge loan in February 2005 with another short-term bridge loan, and he

did so again in April (together, “the bridge loans”). George took personal liability for the

bridge loans, and Virginia executed a deed of trust which pledged several hundred acres

of her land as collateral for the renewals.




        The security instrument for the first loan described $5.1 million in collateral, including the farm’s
        3

equipment, accounts, and lands. This collateral did not include Virginia’s land.

                                                     4
       Finally, a long-term renewal was executed in June 2005, along with a

corresponding deed of trust encumbering the Eubanks’ collateral (together, “the 2005

note”). Gilles testified that the 2005 note was to be repaid over the course of fifteen

years, though it was set to mature and require renewal in 2008 to allow for the adjustment

of the interest rate. This time, Virginia pledged additional land in exchange for the 2005

note, amounting to nearly 400 acres in total. Gilles testified that the Bank prepared the

necessary documents for the 2005 note, including documents stating that the directors of

the family corporation approved the transaction at a board meeting in October 2005.

       Gilles testified that the apparent inconsistency in dates in the 2005 note—which

was executed in July 2005, but described a board-approval process that occurred in the

future, in October 2005—must have been a typographical error.

       Gilles testified that the Eubanks made payments on the 2005 note in 2006 and

2007. During that time, Virginia sold a portion of her land and used the profit to pay down

the debt, as Gilles testified that she had planned. As a result, the 2005 note was on track

to be paid off in eight years rather than the fifteen years originally anticipated. Gilles

attested that he left the Bank before the 2005 note matured, but before his departure, he

recommended that the renewal be approved.

       Gilles explained that when the 2005 note matured, Virginia renewed the 2008 note

on her own, taking sole personal liability for the first time, and executed a deed reaffirming

that much of her land was encumbered by the 2008 note. The 2008 note had a principal

amount of $1,294,500, and it obliged Virginia to repay that sum with interest by February




                                              5
2011.    George did not sign the 2008 note, but he did sign the 2008 deed of trust.

Virginia passed away in May 2008.

        2.    James Roberson

        James Roberson testified as the Bank’s representative, and he corroborated much

of Gilles’s testimony. Roberson stated that from the Bank’s perspective, the 2005 loan

seemed reasonable in light of the Eubanks’ history of success, the strength of their

collateral, and the seemingly temporary nature of the farm’s problems. He further stated

that, given Virginia’s financial status and reputation as a prominent realtor, the Bank

viewed Virginia as creditworthy rather than vulnerable.        Under that perspective,

Roberson believed there was no need to warn Virginia against pledging her land.

B.      The Eubanks’ Witnesses

        1.    The Milams

        Virginia’s grandsons Matthew and Mark Milam testified concerning their

experience working at the family farm. Matthew began working at the farm in October of

2003, and Mark began in 2004. The Milams testified that when they started, Virginia had

no role in managing the farm, but that their uncle George handled many aspects of the

family business. However, both Milams soon realized that George had problems with

substance abuse.     According to the Milams, George’s behavior became erratic and

aggressive, often disappearing from the farm for days. The Milams attested that the

farm’s affairs were neglected, and its accounts with vendors went into arrears.

        Matthew stated George was seriously injured in a 2004 car accident, and with

George often absent, he began to forge George’s signature on payroll checks. Matthew


                                            6
testified that Gilles approved of this practice, and the Bank never returned any of the

forged checks.

      Matthew testified that in the fall of 2004, he attended a meeting where Gilles

proposed to George and Virginia that they should take out a large loan to pay off and

consolidate their outstanding debts, with Virginia committing real estate as collateral.

Matthew testified that in December of 2004, he forged George’s name on the documents

for the first bridge loan. He testified that he did so based on Gilles’s instructions and

based on his fear that the farm would soon fold without operating capital.

      According to Matthew, George abruptly fired him from his position as office

manager in January 2005, and Mark assumed that job. Mark testified that toward the

end of 2005, he began to assume greater responsibility over the farm’s managerial

decisions. Throughout these years, the Milams testified that much of the planting and

related labor was run by the farm’s foreman Joe Rodriguez.

      Mark explained that in 2006, during a visit to the Bank, he told Gilles of George’s

worsening condition. Mark explained that George would not show up at the farm for

weeks at a time, and Virginia was attempting to get him psychological help for his

substance abuse.

      Mark further testified that he updated Gilles on George’s condition in 2007. He

explained that George was no longer allowed to drive due to the family’s fear that George,

who was heavily medicated, would get into another collision. Mark also stated that he

witnessed George behaving strangely at the Bank’s attorney’s office when Virginia signed




                                            7
the 2008 note renewal. Nevertheless, he agreed that no one had ever attempted to have

George declared incompetent or removed as trustee of the family’s trust.

       2.     Elayne

       Elayne testified that in 2004, her brother George’s declining health and deepening

substance abuse impaired his ability to oversee the farm.         She testified that after

George’s car wreck, he moved into Virginia’s house, and Virginia took care of him until

her death in 2008, at which point Elayne took care of him. According to Elayne, the car

wreck limited his mobility and allowed him to visit the farm only occasionally.

       Elayne testified that before her death, Virginia was generally unequipped to

oversee the farm herself. She explained that throughout her youth, Virginia had virtually

no role in managing the farm; instead, she was a school librarian during her early career

and later a realtor, but never a farmer.

       Elayne did not dispute that Virginia was generally healthy and had mental capacity

to sign the 2005 and 2008 notes. Instead, Elayne testified that she questioned the

wisdom of Virginia’s decisions, stating that her mother was mistaken in believing that by

helping George with his debt, the farm would resume successful operation. However,

she agreed that Virginia had a right to pledge her finances to assist with George’s debt.

       3.     George

       George offered a similar assessment of Virginia: that she was overly optimistic

concerning the farm’s prospects, but that she certainly had mental capacity, good health,

and self-sufficiency up until her death. He assessed Gilles much differently than the

other Eubanks: he testified that he worked with Gilles for twenty years and viewed Gilles


                                             8
as an honest man. George was not aware of the Bank having done anything wrong

during the transactions at issue in this lawsuit.

       As to his own situation, George agreed that personal problems—including his

injuries and substance abuse—prevented him from managing the farm effectively, which

led Virginia and Mark to take a greater role in managing the farm’s finances. George

testified that he gave Mark authority to sign checks on his behalf, though he agreed that

he signed the bridge loans and the 2005 note and 2008 deed himself.

C.     Jury Findings

       At the conclusion of trial, the jury returned a verdict finding that “the loan

transaction” was unconscionable.           However, the jury found that the Bank’s

unconscionable conduct did not cause any damages to Virginia or the family corporation.

       The jury also found there was a “special relationship of trust and confidence”

between Virginia and the Bank, and that the Bank breached that relationship.

Nonetheless, the jury found that that breach did not cause any actual damages to Virginia.

       Shortly after the jury returned its verdict, the Eubanks filed a “Motion for Judgment

on the Jury Verdict and to Disregard Certain Answers of the Jury.” The trial court denied

the Eubanks’ motion.

       Instead, based on the jury’s findings, the trial court rendered judgment in favor of

the Bank. Within the judgment, the trial court incorporated the jury’s finding that neither

the Bank’s “unconscionable conduct nor the breach of the special relationship was a

proximate cause of actual damages to Plaintiffs,” and because both of the Eubanks’ main

causes of action had failed, the trial court determined that the verdict of the jury was for

the Bank and against the Eubanks. The judgment ordered that the Eubanks take nothing
                                         9
by their claims and instead awarded the Bank attorney’s fees in the amount of $422,000.

This appeal followed.

                                 II.   UNCONSCIONABILITY

       By their first issue, the Eubanks argue that the “Trial Court erred in denying

Plaintiffs’ Motion to Enter Judgment, because the evidence was sufficient to sustain the

Jury’s answer to Jury Question 1 finding that the 2008 loan was unconscionable and

therefore unenforceable.”       The Eubanks generally contend that the 2008 note is

unenforceable as an unconscionable agreement because the Bank exploited Virginia as

an elderly, vulnerable widow in poor financial condition. The Bank responds that the

2008 note is not unconscionable. We agree with the Bank.

A.     Applicable Law

       “The ultimate question of unconscionability of a contract is one of law, to be

decided by the court.” Hoover Slovacek LLP v. Walton, 206 S.W.3d 557, 562 (Tex.

2006); see In re Poly-Am., LP, 262 S.W.3d 337, 349 (Tex. 2008) (orig. proceeding); see

also Venture Cotton Co-op. v. Freeman, 435 S.W.3d 222, 228 (Tex. 2014) (defining the

standard of review for unconscionability under the UCC as a question of law, though a

“highly fact-specific” one).    We apply a de novo standard of review in determining

whether a contract is unconscionable. Delfingen US-Tex., LP v. Valenzuela, 407 S.W.3d

791, 798 (Tex. App.—El Paso 2013, no pet.); see also Hudson Ins. Co. v. Bruce Gamble

Farms, No. 13-15-00098-CV, 2015 WL 6758654, at *4 (Tex. App.—Corpus Christi Nov.

5, 2015, no pet.) (mem. op.).

       Courts do not ordinarily inquire into the reasons for a contract or the relative

fairness of its terms. Venture Cotton, 435 S.W.3d at 228. However, grossly unfair
                                        10
bargains should not be enforced.        Id.   Unconscionable bargains are therefore an

exception to Texas’s well-recognized preference for freedom of contract.           Id.   “The

principle is one of the prevention of oppression and unfair surprise and not of disturbance

of allocation of risks because of superior bargaining power.” In re Olshan Found. Repair

Co., LLC, 328 S.W.3d 883, 892 (Tex. 2010) (orig. proceeding).

       Texas recognizes both substantive and procedural unconscionability. Id.; see

Royston, Rayzor, Vickery, & Williams, LLP v. Lopez, 467 S.W.3d 494, 499 (Tex. 2015)

(combined appeal & orig. proceeding) (“[A]greements may be either substantively or

procedurally unconscionable, or both.”).      Substantive unconscionability refers to the

fairness of the agreement itself, whereas procedural unconscionability refers to the

circumstances surrounding adoption of the agreement. See Olshan Found., 328 S.W.3d

at 892.

       The term “unconscionability” defies precise legal definition because “it is not a

concept, but a determination to be made in light of a variety of factors not unifiable into a

formula.” Venture Cotton, 435 S.W.3d at 228. Depending on context, factors that may

be considered include the commercial atmosphere in which the agreement was made,

the alternatives available to the parties, the parties’ ability to bargain, any illegality or

public-policy concerns, and the agreement’s oppressive or shocking nature. Id.; see,

e.g., Ski River Dev., Inc. v. McCalla, 167 S.W.3d 121, 136 (Tex. App.—Waco 2005, pet.

denied) (listing similar factors, and also considering “any gross disparity in the values

exchanged,” signs that one party did not willingly “assent to the unfair terms,” “knowledge

of the stronger party that the weaker party will be unable to receive substantial benefits


                                              11
from the contract,” and “knowledge of the stronger party that the weaker party is unable

reasonably to protect his interests by reason of” infirmities or ignorance).

B.     Analysis

       The Eubanks assert that the 2008 note was both substantively and procedurally

unconscionable, and therefore unenforceable. As to the procedural aspect, the Eubanks

primarily rely on evidence concerning the adoption of the bridge loans and the 2005 note.

The jury heard evidence that Matthew forged George’s signature on the first bridge loan

in December 2004 at Gilles’s urging, using Bank-prepared forms, and he did so while the

family farm was in poor financial condition.       There was also evidence that Gilles

approached George and Virginia the year Jim died—soon after George was seriously

injured in a car wreck—and proposed that Virginia encumber her land. We agree that

this evidence concerning the 2005 note is somewhat relevant to the alleged

unconscionability of the 2008 note, since the two notes are part of the same transaction.

The Eubanks also question whether George had the ability to bind the family corporation,

given that the 2005 note was executed in July 2005, but according to documents drafted

by the Bank, the note bound the family corporation through a corporate resolution that

was supposedly passed later, in October 2005. As to substantive unconscionability, the

Eubanks argue that the terms of the 2008 note were grossly unfair to Virginia, whom they

portray as an ailing widow with no skill in farming. The Eubanks fault the Bank for

renewing the note in 2008 without providing Virginia with any additional operating capital,

once the nature of George’s situation had become clear to the Bank.

       Nonetheless, we find the record evidence cited by the Eubanks inadequate to

establish an unconscionable agreement, especially when compared to the evidence that
                                        12
the loans were fair agreements between willing and competent parties. George testified

that he gave Matthew authority to sign documents on his behalf, and even if the signatures

on the first bridge loan were “forged,” Virginia was not involved in that transaction in

December 2004. Instead, she first pledged collateral in February of 2005, at which point

George himself signed a bona fide renewal with substantially similar terms. By that time,

George had already accrued a sizeable debt. Witnesses testified that, in response to

George’s request for help, the Bank immediately issued a significant amount of operating

capital to help George and Virginia consolidate the debt and save the family farm. In

exchange, the Bank was to receive repayment and 7.5% interest which, the evidence

suggests, they fully expected to collect.    Internal documents showed that the Bank

projected improvement in the Eubanks’ operation, and there was no evidence that, at that

time, the Bank had any reason to suspect George of substance abuse. Indeed, the Bank

had no apparent reason to believe that George’s other personal problems would be

anything more than temporary setbacks in an otherwise successful thirty-year relationship

with the Eubanks farm. There was no specific evidence that Gilles exerted any improper

influence on Virginia in 2005; instead, George testified that he viewed Gilles and the Bank

as honest and blameless.

       The Eubanks allege the 2008 note was substantively unconscionable because

there was no longer any hope of the note being repaid through farming. However, by

that time, Virginia had already received the primary benefit of her bargain: $1,775,000

in operating capital in 2005, and the chance for her son to resolve his debt and restore

the family farm. Virginia had already significantly indebted herself to the Bank in 2005


                                            13
by collateralizing nearly 400 acres of her land; and according to appraisals just before the

2008 note, Virginia’s land holdings represented over 95% of her personal wealth of

roughly $2,700,000. In exchange for the 2008 note, Virginia received an extension on

her land-liability, and with it, the chance to maximize her land’s value through agreed

sales rather than foreclosure.

        Based on our de novo review, we cannot conclude that the 2008 note was

procedurally or substantively unconscionable. See Olshan Found., 328 S.W.3d at 892;

Hoover Slovacek, 206 S.W.3d at 562. On that basis, the trial court did not err in denying

the Eubanks’ motion to enter judgment. We overrule the Eubanks’ first issue.

        Having found that the 2008 note was not unconscionable, we need not consider

the Eubanks’ second and third issues.4 See TEX. R. APP. P. 47.1.

                                     III.    SPECIAL RELATIONSHIP

        In their fourth issue, the Eubanks complain that the trial court “erred in denying

Plaintiffs’ Motion for Judgment, because the evidence was sufficient to sustain the Jury’s

answer to Jury Questions 11 and 12 finding that there was a special relationship of trust

and confidence between Virginia Eubanks and the Bank and that the Bank breached that

special relationship.” The Bank responds that, as a matter of law, there was no breach

of a special relationship. We agree with the Bank.

A.      Applicable Law




          4 By their second issue, the Eubanks argue that the jury’s causation finding—i.e., their finding that

the Bank’s unconscionable conduct did not cause any actual damages to Virginia or the family
corporation—was against the great weight of the evidence. By their third issue, the Eubanks contend that
the trial court erred in denying their request for a declaration that the 2008 note was unconscionable and
unenforceable.
                                                     14
       Because the issue of whether one has a duty to act in good faith is a question of

law, our review is de novo. El Paso Nat. Gas Co. v. Minco Oil & Gas, Inc., 8 S.W.3d

309, 312 (Tex. 1999). The duty of good faith and fair dealing merely requires the parties

to deal fairly with one another and does not encompass the often more onerous burden

that requires a party to place the interest of the other party before his own, as attributed

to a fiduciary duty. Crim Truck & Tractor Co. v. Navistar Int’l Transp. Corp., 823 S.W.2d

591, 594 (Tex. 1992). In Texas, a duty of good faith and fair dealing is not imposed in

every contract. City of Midland v. O’Bryant, 18 S.W.3d 209, 215 (Tex. 2000). Such a

duty may arise in certain “special relationships” which are marked by shared trust or an

imbalance in bargaining power. Fed. Deposit Ins. Corp. v. Coleman, 795 S.W.2d 706,

708–09 (Tex. 1990); see Victoria Bank & Tr. Co. v. Brady, 779 S.W.2d 893, 902 (Tex.

App.—Corpus Christi 1989) (cataloging recognized special relationships, such as insurer-

insured, joint venturers, partners, etc.), aff’d in part, rev’d in part on other grounds, 811

S.W.2d 931 (Tex. 1991).

       Ordinarily, a “debtor-creditor relationship does not give rise to” a duty of good faith

and fair dealing. Victoria Bank, 779 S.W.2d at 902; see UMLIC VP LLC v. T&M Sales &

Envtl. Sys., Inc., 176 S.W.3d 595, 612 (Tex. App.—Corpus Christi 2005, pet. denied)

(quoting Coleman, 795 S.W.2d at 709). There is a seldom-used exception to this rule:

when a special relationship between a borrower and lender has been found, it has rested

on extraneous facts and conduct, such as excessive lender control over, or influence in,

the borrower’s business activities. Davis v. West, 317 S.W.3d 301, 312 (Tex. App.—

Houston [1st Dist.] 2009, no pet.); see also Falcon Int’l Bank v. Cantu, No. 13-13-00577-


                                             15
CV, 2015 WL 1743396, at *12 (Tex. App.—Corpus Christi Apr. 16, 2015, no pet.) (mem.

op.). “Texas courts have been reluctant to find a special relationship in [this] context.”

K3C Inc. v. Bank of Am., NA, 204 Fed. Appx. 455, 461 (5th Cir. 2006) (per curiam); see,

e.g., Falcon Int’l, 2015 WL 1743396, at *12 (finding no special relationship between a

creditor and debtor, despite evidence that the lender oversaw the use of borrowed funds).

B.     Analysis

       The Eubanks contend that there was sufficient evidence of a special relationship

between Virginia and the Bank. As support, the Eubanks cite testimony at trial linking

Virginia’s extended family with various employees of the Bank. There was testimony, for

instance, that Virginia’s granddaughter was good friends with Gilles’s daughter. This

evidence has little bearing on Virginia’s relationship with the Bank.

       Rather, there was negligible evidence of “excessive lender control over, or

influence in, the borrower’s business activities.” Davis, 317 S.W.3d at 312. According

to the Eubanks and their witnesses, Virginia’s “business” was solely that of librarian and

realtor, and she had no connection with the family farm. Under that assumption, there

was no evidence that Bank had a relationship with Virginia’s business at all.

       In the alternative, even assuming that Virginia did have a substantial role in the

farm, there was little evidence that the Bank exerted control over the management of the

farm. At most, the Bank urged George and Virginia to sign and pledge collateral for

loans, which were to be used to pay debts arising from the farm as well as George’s

personal life. This establishes nothing more than a debtor-creditor relationship, which

does not give rise to a duty of good faith and fair dealing. See Victoria Bank, 779 S.W.2d

at 902.
                                            16
        We find the evidence insufficient to establish a special relationship between

Virginia and the Bank. We overrule the Eubanks’ fourth issue. Having found that there

is insufficient evidence to show a special relationship, this renders it unnecessary to

consider the Eubanks’ fifth issue, which depends upon a finding of a special relationship.5

See TEX. R. APP. P. 47.1.

                                       IV.     RELEASE OF LIEN

        By their sixth issue, the Eubanks assert that the trial court erred in denying a

directed verdict on the ground that the 2008 note was invalid due to a prior release of lien.

The Eubanks assert that the Bank executed a broad release-of-lien that, perhaps

inadvertently, eliminated the Bank’s ability to rely on Virginia’s deeds of trust as security.

        In August 2005, the Bank signed a release-of-lien with broad language:

        Holder of the notes and liens acknowledges their payment and releases the
        property from the liens and from all liens held by Holder of the notes and
        liens without regard to how they were created or evidenced.

        Holder of the notes and liens expressly releases all present and future rights
        to establish or enforce the liens as security for the payment of any future or
        other advances.

(Emphasis added). The Eubanks point out that by August 2005, Virginia had already

signed two deeds of trust, one in February 2005 and another in June of 2005. The

Eubanks argue that the term “all liens” must include both deeds of trust. The Bank

responds that the Eubanks read the release too broadly; the Bank argues that the rest of




        5 By their fifth issue, the Eubanks challenge the jury’s finding that the breach caused no damages,
arguing that this finding is against the great weight of the evidence.

                                                    17
the release specifically refers only to the deed that Virginia executed in February 2005,

and the Eubanks have taken the phrase “all liens” out of context. 6

        We need not decide whether the Bank or the Eubanks have interpreted the release

correctly. Even assuming that the Eubanks are correct and both deeds of trust from

2005 were extinguished, Virginia executed another deed of trust in 2008, and it is that

deed which the Bank relies upon in this litigation.

        However, the Eubanks argue that by rule, Virginia was prevented from renewing

the lien, regardless of the release’s language.                They argue that under Texas law,

executing a release permanently extinguishes the secured party’s interest, such that it is

impossible to later renew any security. The Eubanks cite no authority for this proposition.

        The Eubanks appear to be arguing by analogy to a rule that has been applied to

statutory mechanic’s liens on real property. See Apex Fin. Corp. v. Brown, 7 S.W.3d

820, 830 (Tex. App.—Texarkana 1999, no pet.).                     In Apex, it was said that once a

mechanic’s lien is released or waived, the “statutory lien cannot be revived.” Id.; Lyda

Swinerton Builders, Inc. v. Cathay Bank, 409 S.W.3d 221, 232 (Tex. App.—Houston [14th

Dist.] 2013, pet. denied) (same, citing Apex); see also Roberts v. Dixon, No. 12-15-00181-

CV, 2016 WL 900205, at *2 (Tex. App.—Tyler Mar. 9, 2016, no pet.) (mem. op.) (same,

citing Apex).




        6 According to the Bank, the rest of the release consistently refers to only one lien—the February
2005 deed of trust—and the Bank urges us to read the passage quoted by the Eubanks as referring only
to that deed, pursuant to the principle of ejusdem generis. See Ross v. St. Luke’s Episcopal Hosp., 462
S.W.3d 496, 504 n.1 (Tex. 2015) (“[T]he rule of ejusdem generis . . . provides that when words of a general
nature are used in connection with the designation of particular objects or classes of persons or things, the
meaning of the general words will be restricted to the particular designation.”).
                                                    18
       The rule applied in Apex is inapplicable to these facts. The Apex court relied upon

the provisions of the mechanic’s lien statute in reaching its holding, but that statute does

not apply here.    See Apex, 7 S.W.3d at 830–31; see also TEX. PROP. CODE ANN.

§ 53.001(5) (West, Westlaw through 2017 1st C.S.). Indeed, the Apex court recognized

that though an extinguished mechanic’s lien could not be revived as a mechanic’s lien,

the same lien could be revived as another form of security interest—there, a constitutional

lien. See Apex, 7 S.W.3d at 830–31. Because this case involves a different form of

security interest, Virginia was not prevented from executing another note to renew the

debt or another deed of trust to reaffirm the Bank’s security interest in her land. See,

e.g., Doss v. Homecoming Fin. Network, Inc., 210 S.W.3d 706, 709–10 (Tex. App.—

Corpus Christi 2006, pet. denied) (upholding a trial court’s order reviving a lender’s

security interest in real property—a vendor’s lien—after it had been released); see

generally Perkins v. Sterne, 23 Tex. 561, 562 (1859).            The Eubanks’ argument

concerning the release is unavailing.

       We overrule the Eubanks’ sixth issue.

                                    V.     SANCTIONS

       By their seventh issue, the Eubanks contend that the trial court abused its

discretion by not sanctioning the Bank for discovery abuse. The Eubanks moved for

monetary sanctions, but never obtained a ruling or objected to the trial court’s failure to

rule. The question of monetary sanctions is therefore not preserved for our review. See

TEX. R. APP. P. 33.1(a)(2).

       The Eubanks also requested a spoliation instruction as a discovery sanction, which

the trial court denied. They complain that the Bank did not produce documents that the
                                           19
Eubanks deemed critical, including the minutes for the meeting wherein the Bank’s loan

committee approved the loans to George and Virginia.

A.      Applicable Law

        Sanctions may be imposed, after notice and hearing, on parties who refuse to

respond, or who give inadequate responses, to valid discovery requests or orders.

Horizon Health Corp. v. Acadia Healthcare Co., Inc., 520 S.W.3d 848, 884 (Tex. 2017).

Rule 215 generally leaves the decision to impose sanctions to the sound discretion of the

trial court. Id. “Similarly, a trial court’s refusal to impose a particular sanction can be

set aside only upon a showing of a clear abuse of discretion.” Smithson v. Cessna

Aircraft Co., 665 S.W.2d 439, 442–43 (Tex. 1984); EP Operating Co. v. MJC Energy Co.,

883 S.W.2d 263, 270 (Tex. App.—Corpus Christi 1994, writ denied). A trial court abuses

its discretion if it acts without reference to any guiding rules or principles. Horizon Health,

520 S.W.3d at 884. Its judgment should be reversed only if the ruling was arbitrary or

unreasonable.       Id.   Appellate courts must independently review the entire record to

determine whether the trial court abused its discretion regarding sanctions. Am. Flood

Research, Inc. v. Jones, 192 S.W.3d 581, 583 (Tex. 2006) (per curiam).

        The “broad discretion” granted to trial courts to impose discovery sanctions is

subject to several limitations.7 See Horizon Health, 520 S.W.3d at 884. A request for a



        7  In general, any sanction award must further one of the recognized purposes of discovery
sanctions: (1) to secure the parties’ compliance with the rules of discovery; (2) to deter other litigants from
violating the discovery rules; and (3) to punish parties that violate the rules of discovery. Horizon Health
Corp. v. Acadia Healthcare Co., Inc., 520 S.W.3d 848, 884 (Tex. 2017). A sanction must also satisfy a
two-part inquiry. See CHRISTUS Health Gulf Coast v. Carswell, 505 S.W.3d 528, 540 (Tex. 2016). First,
there must be a direct relationship between the improper conduct and the sanction imposed. Id. “[I]n
other words, the court should examine whether punishment was imposed upon the true offender and
tailored to remedy any prejudice discovery abuse caused.” Am. Flood Research, Inc. v. Jones, 192
                                                     20
spoliation instruction is subject to further restrictions.8 See Petro. Sols., Inc. v. Head,

454 S.W.3d 482, 488 (Tex. 2014).

        In determining what remedy, if any, is appropriate to address a spoliation of

evidence, the court should weigh the spoliating party’s culpability and the prejudice to the

nonspoliating party.       Id. at 488–89.       Prejudice is evaluated based on the spoliated

evidence’s relevance to key issues in the case, whether the evidence would have been

harmful to the spoliating party’s case (or, conversely, helpful to the nonspoliating party’s

case), and whether the spoliated evidence was cumulative of other competent evidence

that may be used in its stead. Id. at 489. Ultimately, a trial court may submit a spoliation

instruction “only if it finds (1) the spoliating party acted with intent to conceal discoverable

evidence, or (2) the spoliating party acted negligently and caused the nonspoliating party

to be irreparably deprived of any meaningful ability to present a claim or defense.” Id.

B.      Analysis

        In their motions to compel, the Eubanks detail the history of the Bank’s document

production. The Eubanks’ lawsuit was filed in August 2011, and sixty-three days later,

the Bank produced 4,363 pages of responsive documents. The Bank later retained

additional counsel, who issued a supplemental production of 6,651 pages of documents

in May 2014. The supplement was accompanied by a letter from counsel explaining, “It


S.W.3d 581, 583 (Tex. 2006) (per curiam). Second, the sanction must not be excessive relative to the
conduct in question. CHRISTUS Health, 505 S.W.3d at 540.
        8 To find that spoliation occurred, the trial court must make affirmative determinations as to two
elements. See Petro. Sols., Inc. v. Head, 454 S.W.3d 482, 488 (Tex. 2014). First, the party who failed to
produce evidence must have had a duty to preserve the evidence. Id. “Such a duty arises only when a
party knows or reasonably should know that there is a substantial chance that a claim will be filed and that
evidence in its possession or control will be material and relevant to that claim.” Id. (editorial marks
omitted). Second, the nonproducing party must have breached its duty to reasonably preserve material
and relevant evidence. Id. A party cannot breach its duty without at least acting negligently. Id.
                                                    21
is my understanding that there have been some discussions questioning what has and

what has not been produced. To avoid arguments, we are producing documents in

supplementation to, and probably duplication of, what has already been produced . . . .”

On January 28, 2016, counsel for the Bank again supplemented production, producing

3,619 documents “in an abundance of caution,” most if not all of which were duplicative

of other production.

        At a hearing on the Eubanks’ second motion to compel, counsel for the Bank

indicated that the Bank had searched for the meeting minutes for the Bank’s loan

committee but could not find them. Counsel explained that the loan was issued by a

predecessor entity—Texas State Bank—that later merged with BBVA Compass Bank,

and it had not been easy to locate documents from Texas State Bank following the

merger.

        At trial, the Bank’s witnesses were asked to justify the Bank’s failure to produce

certain documents, including the meeting minutes.9 Roberson explained that the Bank

generally made efforts to preserve loan documents, but the Bank had been unable to

locate any such meeting minutes following the merger with Texas State Bank. Roberson

believed it was possible the meeting minutes had been lost or misplaced, but the Bank

otherwise provided all responsive documents that it was able to locate. Gilles was also

asked to explain the absence of the meeting minutes. He testified that the Bank did not

independently create meeting minutes; instead, the Bank simply took loan presentation



          9 But see id. (“Because the trial court bears this responsibility [to assess spoliation], evidence of

the circumstances surrounding alleged spoliation is generally inadmissible at trial, as such evidence is
largely irrelevant to the merits and unfairly prejudicial to the spoliating party.”).
                                                     22
documents and stamped them as approved or disapproved, as appropriate.                Gilles

testified that he believed the loan presentation had been provided to the Eubanks.

       At the charge conference, the trial court denied the Eubanks’ request for a

spoliation instruction.   The trial court explained its view that the loan documents

themselves, together with witness testimony, were enough to fully present the facts to the

jury without the benefit of formalized meeting minutes, if any ever existed.

       Based on our independent review, the record does not show that the Bank acted

“with intent to conceal discoverable evidence.” See id. Rather, the Bank-witnesses’

testimony established one of two scenarios: at worst, the Bank failed to produce meeting

minutes despite the Bank’s best efforts to preserve and locate documents after a merger;

at best, the meeting minutes were in fact produced, albeit as a stamped loan presentation.

Neither scenario presents a case of intentional concealment or destruction. See id.; see

also Christerson v. Speer, No. 01-16-00469-CV, 2017 WL 1520449, at *7 (Tex. App.—

Houston [1st Dist.] Apr. 27, 2017, pet. denied) (mem. op.) (finding the trial court did not

err in rejecting a spoliation instruction because “the evidence about the note in the record

is that the [appellees], after a thorough search, were unable to find it”).

       We also agree with the trial court’s assessment that the Eubanks were not

prejudiced, even assuming there was a spoliation. See Petro. Sols., 454 S.W.3d at 489.

There was no indication that the meeting minutes contained vital information that was not

cumulative of other documents (such as the projections contained within the loan

paperwork) and other witness testimony (such as Roberson’s testimony concerning the

Bank’s internal processes). Therefore, the trial court did not abuse its discretion in


                                             23
finding that the Bank’s wrongful actions, if any, did not cause the Eubanks “to be

irreparably deprived of any meaningful ability to present a claim or defense.” See id.;

Horizon Health, 520 S.W.3d at 884.

        Because the Eubanks did not demonstrate either situation in which a spoliation

instruction is warranted, the trial court correctly denied the instruction. 10 See Petro.

Sols., 454 S.W.3d at 489. We overrule the Eubanks’ seventh issue.

                                    VI.          CORPORATE AUTHORITY

        By their eighth issue, the Eubanks assert that the trial court erred in denying their

post-judgment motion for judgment notwithstanding the verdict on the ground that George

did not have authority to bind the family corporation. While the Eubanks did file certain

post-judgment motions, these motions did not mention the issue of corporate authority or

urge the trial court to grant JNOV on that basis. Accordingly, the Eubanks have not

preserved this complaint for our review. See TEX. R. APP. P. 33.1(a).

                                          VII.     ATTORNEY’S FEES

        By their ninth issue, the Eubanks challenge the trial court’s award of attorney’s

fees in the amount of $422,000 against all appellants, whom we have collectively referred

to as the Eubanks. In the final judgment, the trial court based its award on the fact that

“the parties stipulated to attorney’s fees . . . .” The Eubanks assert, however, that only

some of the Eubanks-parties stipulated to attorney’s fees in documents associated with



        10On appeal, the Eubanks also complain of the trial court’s refusal to submit a spoliation instruction
concerning the Bank’s purported failure to produce other documents. However, this complaint does not
conform with the Eubanks’ argument at the charge conference, and it is therefore not preserved for our
review. See TEX. R. APP. P. 33.1(a); see, e.g., Lowry v. Tarbox, 537 S.W.3d 599, 617 (Tex. App.—San
Antonio 2017, pet. denied) (“On appeal, appellants present an entirely different argument [concerning the
proposed jury] question . . . .”).
                                                      24
the 2008 note, whereas other Eubanks-parties never stipulated to attorney’s fees. The

Eubanks contend that the trial court therefore erred in entering an undifferentiated award

of attorney’s fees against all the Eubanks.

A.    Applicable Law

      Texas follows the American rule on attorney’s fees, under which a party generally

may not recover attorney’s fees unless authorized by statute or contract. In re Nat’l

Lloyds Ins. Co., 532 S.W.3d 794, 809 (Tex. 2017) (orig. proceeding). The party seeking

to recover attorney’s fees carries the burden of proof. Kingsley Props., LP v. San Jacinto

Title Servs. of Corpus Christi, LLC, 501 S.W.3d 344, 349 (Tex. App.—Corpus Christi

2016, no pet.).   When a contract is not ambiguous, the construction of the written

instrument is a question of law for the court. First Bank v. Brumitt, 519 S.W.3d 95, 105

(Tex. 2017).

B.    Analysis

      The trial court found that “the parties stipulated to attorney’s fees . . . .” We agree

with the Eubanks that this finding is true as to certain parties who signed the 2008 note

and deed of trust.    However, other parties did not sign these instruments, and the

instruments therefore provide no basis to assess attorney’s fees against these parties.

      Specifically, the 2008 deed of trust was signed by: (1) Virginia only in her capacity

as independent executrix of the Estate of James Eubanks, (2) George individually, and

(3) George on behalf of the family corporation. The 2008 deed of trust provided that the

grantors

      will pay all attorney’s fees and expenses which may be incurred by the
      Noteholder in enforcing the terms of the Note and this Deed of Trust or in

                                              25
       any suit in which the Noteholder may become a party where this Deed of
       Trust or the Mortgaged Premises is in any manner involved . . . .

(Emphasis added). It is undisputed that the Bank, as the noteholder, became a party to

this suit, which “in any manner involved” the 2008 deed of trust. See id. Thus, the 2008

deed of trust authorized the Bank to collect attorney’s fees from the grantors of the deed,

who were George, Jim’s estate, and the family corporation. But it does not provide a

basis for the Bank to collect attorney’s fees from appellants who did not sign it, including

Elayne Mattar, individually and as trustee of the James E. Eubanks and Virginia L.

Eubanks Family Trust, and Mark Milam, as executor of Virginia’s estate.              See Nat’l

Lloyds, 532 S.W.3d at 809.

       The 2008 note itself was signed solely by Virginia in her individual capacity, and it

provides as follows:

       If this note is placed in the hands of an attorney for collection, or is collected
       through the Probate or Bankruptcy Court, or through other legal
       proceedings, the makers, endorsers, and/or guarantors hereof further
       promise to pay reasonable attorney’s fees (which is agreed to be ten
       percent (10%) of the unpaid balance owing thereon) . . . .

       As we interpret it, the 2008 note permits recovery of attorney’s fees from Virginia’s

estate in some instances, but not others. See First Bank, 519 S.W.3d at 105. The trial

court impliedly found that this suit was of the type that warranted an award of attorney’s

fees against Virginia’s estate. See Shields LP v. Bradberry, 526 S.W.3d 471, 480 (Tex.

2017). The Eubanks do not challenge this finding; indeed, they argue in their brief that

their reason for filing the instant lawsuit was “[t]he Bank’s attempt to foreclose on the

property” for alleged breach of the 2008 note. The 2008 note therefore permitted the

Bank to seek attorney’s fees from Mark Milam, as executor of Virginia’s estate to the

                                              26
extent of 10% of the balance on the 2008 note, but it did not authorize an award against

Elayne Mattar or the family trust.11 See Nat’l Lloyds, 532 S.W.3d at 809.

        In summary, the 2008 deed of trust authorizes attorney’s fees against two parties

to these proceedings:           the family corporation and Jim’s estate.                  The 2008 note

authorizes attorney’s fees against Virginia’s estate, but only to the extent of 10% of the

outstanding debt on the note. None of the instruments at issue here authorize an award

of attorney’s fees against Elayne Mattar or the family trust.

        Because the trial court awarded attorney’s fees exceeding these bounds, we

sustain this aspect of the Eubanks’ ninth issue. 12                  This award should be reformed

following a hearing to determine the amount of attorney’s fees chargeable against

Virginia’s estate, if any.

                                           VIII.   CONCLUSION

        We reverse the judgment of the trial court to the extent that it awards attorney’s

fees against: (1) Elayne Mattar, individually and as trustee of the James E. Eubanks and

Virginia L. Eubanks Family Trust; and (2) Mark Maximillian Milam, as independent

executor of the estate of Virginia L. Eubanks. We remand that portion of the judgment


        11 The Bank contends, in the alternative, that the award of attorney’s fees is supportable under the
declaratory judgment act. The declaratory judgment act provides that a trial court may award costs and
reasonable attorney’s fees when doing so is equitable and just. Castille v. Serv. Datsun, Inc., __S.W.3d__,
__, No. 01-16-00082-CV, 2017 WL 3910918, at *10 (Tex. App.—Houston [1st Dist.] Sept. 7, 2017, no pet.)
(mem. op); see TEX. CIV. PRAC. & REM. CODE ANN. § 37.009 (West, Westlaw through 2017 1st C.S.).
However, the trial court, in its discretion, did not determine that an award of attorney’s fees would serve the
interests of equity, and due to the Bank’s conduct, the record does not warrant such a finding on appeal.
See Bocquet v. Herring, 972 S.W.2d 19, 21 (Tex. 1998).
         12 Also within their ninth issue, the Eubanks contend that the trial court erred in refusing to award

the Eubanks attorney’s fees, because the Bank both (1) entered an unconscionable contract and (2)
breached its special relationship with Virginia. We have already determined that the 2008 note was not
unconscionable and the Bank had no special relationship with Virginia. Accordingly, we need not address
this contention. See TEX. R. APP. P. 47.1.
                                                     27
for further proceedings consistent with this opinion. We affirm the judgment of the trial

court in all other respects.



                                                             NELDA V. RODRIGUEZ
                                                             Justice

Delivered and filed the
31st day of May, 2018.




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