                                                                                ACCEPTED
                                                                            05-15-00626-CV
                                                                 FIFTH COURT OF APPEALS
                                                                            DALLAS, TEXAS
                                                                      10/27/2015 9:14:48 PM
                                                                                 LISA MATZ
                                                                                     CLERK

                       NO. 05-15-00626-CV
__________________________________________________________________
                                                         FILED IN
                                                  5th COURT OF APPEALS
               IN THE FIFTH COURT OF APPEALS DALLAS, TEXAS
                         DALLAS, TEXAS            10/27/2015 9:14:48 PM
__________________________________________________________________
                                                         LISA MATZ
                                                           Clerk

                  ARGENT DEVELOPMENT, L.P.,

                                        Appellant,

                                 v.

     LAS COLINAS GROUP, L.P., and BILLY BOB BARNETT,

                                       Appellees.
__________________________________________________________________

       On Appeal from the 134th District Court, Dallas, Texas
                      Cause No. DC-13-13507
__________________________________________________________________

                      APPELLEES’ BRIEF
__________________________________________________________________

                                 J. Robert Arnett II
                                 CARTER SCHOLER ARNETT HAMADA
                                 & MOCKLER, PLLC
                                 8150 N. Central Expy., Ste. 500
                                 Dallas, Texas 75206
                                 Tel: (214)-550-8188
                                 Fax: (214)-550-8185

                                 ATTORNEY FOR LAS COLINAS
                                 GROUP, L.P. AND BILLY BOB
                                 BARNETT




                ORAL ARGUMENT REQUESTED
                                   TABLE OF CONTENTS

TABLE OF CONTENTS .......................................................................... ii

INDEX OF AUTHORITIES .................................................................... iv

STATEMENT OF THE CASE ............................................................... vii

STATEMENT REGARDING ORAL ARGUMENT .............................. viii

ISSUES PRESENTED ............................................................................ ix

STATEMENT OF FACTS ........................................................................ 1

I.      LCG enters into a development agreement with the
        City of Irving to develop and subsequently lease from
        the City an entertainment center ................................................... 1

II.     LCG executes a promissory note to Argent, and seven
        months later Barnett agrees to the conditional
        Guaranty .......................................................................................... 2

III.    The LCG Development Agreement expires pursuant to
        its own terms on August 6, 2012, and litigation ensues ............... 4

IV.     The City makes a deal with a new developer and
        settles the LCG-City Lawsuit ......................................................... 6

V.      Argent files suit against LCG and Barnett and the trial
        court properly grants summary judgment in favor of
        Barnett on the Guaranty ................................................................ 9

SUMMARY OF THE ARGUMENT ....................................................... 10

STANDARD OF REVIEW ..................................................................... 12

ARGUMENT ........................................................................................... 12

I.      LCG’s “release” of its claims arising under the LCG
        Development Agreement was not a “transfer” of an
        interest in that contract ................................................................ 13



                                                      ii
II.    That the City and LCG entered into a settlement
       agreement involving the City’s new developer paying
       money to LCG does not establish that LCG transferred
       its interest in the LCG Development Agreement ........................ 21

III.   LCG did not sell, assign, or transfer its interest in the
       Development Agreement because it expired and
       terminated by its own terms ......................................................... 23

       A.      The overwhelming evidence establishes the LCG
               Development Agreement expired before any
               alleged transfer .................................................................... 23

       B.      Judicial estoppel cannot apply because the
               required elements of estoppel are met ................................ 27

CONCLUSION ....................................................................................... 32

CERTIFICATE OF SERVICE ............................................................... 35

CERTIFICATE OF COMPLIANCE WITH RULE 9.4(i) ...................... 36




                                                  iii
                                  INDEX OF AUTHORITIES

CASES                                                                                                PAGE(S)

Bob Short & Assocs., Inc. v. Heritage Res., Inc., No.
05-95-00472-CV, 1996 WL 223680 (Tex. App.—
Dallas Apr. 30, 1996, writ denied) ........................................................... 31

Buck v. Palmer, 382 S.W.3d 525 (Tex. 2012) .......................................... 12

Carpet Servs., Inc. v. George A. Fuller Co. of Texas,
Inc., 802 S.W.2d 343 (Tex. App.—Dallas 1990) (en
banc), aff’d, 823 S.W.2d 603 (Tex. 1992) ................................................. 16

City of Brownsville v. AEP Texas Central Co., 348
S.W.3d 348 (Tex. App.—Dallas 2011, pet. denied) ........................... 19, 20

City of San Antonio v. Valemas, Inc., No. 04-11-
00768-CV, 2012 WL 2126932 (Tex. App.—San
Antonio June 13, 2012, no pet.) ......................................................... 19, 20

Dearborn Stove Co. v. Caples, 236 S.W.2d 486 (Tex.
1951) .......................................................................................................... 20

e2 Creditors’ Trust v. Farris (In re e2
Communications, Inc.), 320 B.R. 849 (Bankr. N.D.
Tex. 2004) ............................................................................................. 18-19

Edwards v. Kaye, 9 S.W.3d 310 (Tex. App.—Houston
[14th Dist.] 1999, pet. denied)............................................................ 15, 16

Flying Diamond-W. Madisonville L.P. v. GW
Petroleum, Inc., No. 10-07-00281-CV, 2009 WL
2707405 (Tex. App.—Waco Aug. 26, 2009, no pet.) ................................ 31

Gabarick v. Laurin Maritime (America) Inc., 753
F.3d 550 (5th Cir. 2014)............................................................................. 29

Galley v. Apollo Associated Servs., Ltd., 177 S.W.3d
523 (Tex. App.—Houston [1st Dist.] 2005, no pet.)............................ 28, 30



                                                        iv
Griffin Indus. Inc. v. Foodmaker, Inc., 22 S.W.3d 33
(Tex. App.—Houston [14th Dist.] 2000, pet. denied) .............................. 23

Grohman v. Kahlig, 318 S.W.3d 882 (Tex. 2010) ............................... 14-17

Kastigar v. U.S., 406 U.S. 441 (1972) ...................................................... 16

King Ranch, Inc. v. Chapman, 118 S.W.3d 742
(Tex. 2003)................................................................................................. 12

Lester v. First American Bank, 866 S.W.2d 361 (Tex.
App.—Waco 1993, writ denied) .......................................................... 15, 16

Mangione v. Gov’t Personnel Mutual Life Ins. Co.,
No. 04-01-00655-CV, 2002 WL 1677457 (Tex. App.—
San Antonio July 24, 2002, pet. denied) ............................................. 23-24

Metroflight, Inc. v. Shaffer, 581 S.W.2d 704 (Tex.
Civ. App.—Dallas 1979, writ ref’d n.r.e.) ................................................ 28

Nine Syllables, LLC v. Evans, No. 05-13-01677-CV,
2015 WL 3932751 (Tex. App.—Dallas June 26, 2015,
no pet. hist.) ............................................................................. 27, 28, 31-32

Pagosa Oil and Gas, LLC v. Marrs and Smith P’ship,
323 S.W.3d 203 (Tex. App.—El Paso 2010, pet.
denied) ................................................................................................. 19, 20

Pleasant Glade Assembly of God v. Schubert, 264
S.W.3d 1 (Tex. 2008) ........................................................................... 29, 30

Reynolds-Penland Co. v. Hexter & Lobello, 567
S.W.2d 237 (Tex. Civ. App.—Dallas 1978, writ
dism’d) ....................................................................................................... 16

Sims v. State, 82 S.W.3d 730 (Tex. App.—Waco
2002), aff’d, 117 S.W.3d 267 (Tex. Crim. App. 2003). ............................. 17

Southtex 66 Pipeline Co. v. Spoor, 238 S.W.3d 538
(Tex. App.—Houston [14th Dist.] 2007, pet. denied) .............................. 18



                                                        v
Texas Capital Sec. Mgmt., Inc. v. Sandefer, 80
S.W.3d 260 (Tex. App.—Texarkana 2002, pet. struck) .......................... 30

Texas Real Estate Commission v. Nagle, 767 S.W.2d
691 (Tex. 1989).......................................................................................... 30

Travelers Indem. Co. of Ill. v. Fuller, 892 S.W.2d 848
(Tex. 1995)................................................................................................. 18

Turner v. PV Int’l Corp., 765 S.W. 455 (Tex. App.—
Dallas 1988), writ denied, 778 S.W.2d 865 (Tex.
1989) .......................................................................................................... 28



OTHER AUTHORITIES

BLACK’S LAW DICTIONARY (9th ed. 2009)....................................... 13-15, 17

TEX. R. CIV. P. 166a. ................................................................................. 12




                                                        vi
                            STATEMENT OF THE CASE

Nature of the case:                This is suit over a promissory note and a
                                   conditional guaranty. CR 8-50.1

Course of proceedings:             After Argent Development, L.P., sued to
                                   collect on a promissory note against Las
                                   Colinas Group, L.P. (“LCG”) and a
                                   conditional guaranty against Billy Bob
                                   Barnett, CR 11-12, Barnett moved for
                                   summary judgment on Argent’s claims. CR.
                                   718-1619.

Trial Court’s Disposition:         After briefing and oral argument, the trial
                                   court granted Barnett’s summary judgment
                                   motion on Argent’s claims against him. CR
                                   1800. Pursuant to an agreement between
                                   LCG and Argent, the trial court then
                                   entered an agreed judgment on Argent’s
                                   claims against LCG. CR 1802-04.




1
    All citations to the Clerk’s Record appear as “CR __.”


                                            vii
          STATEMENT REGARDING ORAL ARGUMENT

     Barnett requests oral argument. While Barnett believes this is a

straightforward case of contract interpretation, oral argument may

assist the Court in addressing Argent’s creative arguments regarding

the legal principles at issue and their application to the facts.




                                    viii
                       ISSUES PRESENTED

     Did the trial court properly grant Barnett’s summary judgment

motion where a condition precedent to his liability under a guaranty

agreement was not satisfied?




                                 ix
                      STATEMENT OF FACTS

I.   LCG enters into a development agreement with the City of
     Irving to develop and subsequently lease from the City an
     entertainment center.

     On December 11, 2008, LCG and the City of Irving entered into a

Entertainment Center Development Agreement (the “LCG Development

Agreement”), for LCG to design and develop an entertainment center

that would be owned by the City and leased and operated by LCG under

a long-term lease.    CR 747-48, 751-801.      The LCG Development

Agreement contemplated contributions towards the cost of the

entertainment center by both LCG (from private funds) and the City

(from bond proceeds). CR 748, 771-81.

     The LCG Development Agreement contained a deadline for LCG

to close on its private funding, after the City notified LCG of the

amount of the estimated net bond proceeds. After several amendments,

this deadline was August 6, 2012. CR 748, 860. The last amendment to

the agreement specifically provided, “If the Closing Date does not occur

on or before August 6, 2012, then this Agreement automatically

terminates without any necessity for any further action by either

party.” CR 860.



                                   1
II.   LCG executes a promissory note to Argent, and seven
      months later Barnett agrees to the conditional Guaranty.

      One of LCG’s sources of funding for its pre-development costs was

a loan from Argent. On December 1, 2010, LCG and Argent entered

into a Promissory Note. CR 863-65. The maturity date—and LCG’s

obligation to pay—under the Promissory Note was triggered by three

alternative events. Id.

      “Doc” Cornutt, the owner of Argent, asked Barnett to personally

guaranty the Promissory Note from LCG, but Barnett declined to do so.

CR 745. Cornutt told Barnett he wanted to make sure he was repaid if

LCG received proceeds from bonds the City was going to issue for the

public financing piece of the entertainment center, or if LCG sold its

Development Agreement to someone else.        Id. Barnett told Cornutt

that if one of those things happened, and LCG did not repay the

Promissory Note, Barnett would, but otherwise he was not going to

guaranty the LCG Promissory Note. Id. Based on that understanding,

Barnett and Argent entered into a Guaranty Agreement of the

Promissory Note on July 27, 2011. CR 868.

      The Guaranty placed conditions on Barnett’s liability:




                                    2
     In the event the Maker [LCG] should not perform the
     obligations specified in Section 1 on or before the times they
     are to be performed, subject to the conditions stated in this
     paragraph 2, the Guarantor [Barnett] guarantees and agrees
     that Guarantor shall immediately pay, do, and perform all
     such obligations for the benefit of the Lender [Plaintiff],
     conditioned only upon the passage of thirty (30) days after
     the earlier of: a) issuance (the “Bond Issuance”) by the City
     of Irving, Texas, of city bonds, any portion of the proceeds of
     which are applied, or publicly announced to be for
     application, to the project costs for the project commonly
     referred to as the “Irving Entertainment Center” (the
     “Entertainment Center”) to be constructed at West Las
     Colinas Boulevard and Fuller Drive in Irving, Texas, or b)
     the sale, assignment, or other transfer by Las Colinas Group
     of all or any interest in that one certain Development
     Agreement by and between the City of Irving and Las
     Colinas Group, dated December 11, 2008 (as amended, the
     “Development Agreement”), or a change in ownership of
     more than fifty percent (50%) of Las Colinas Group (“LCG
     Transfer”).     The Bond Issuance shall provide public
     financing for the Entertainment Center construction, as
     represented by Maker to Lender, and permit Maker to fund
     the commencement of construction of the Entertainment
     Center, as well as provide liquidity for payment of the
     Agreed Credit. Unless and until the passage of thirty
     (30) days after the earlier of the Bond Issuance or LCG
     Transfer shall occur, Guarantor shall not be liable
     hereunder for all or any portion of the Agreed Credit.

CR 745, 868 (emphasis added).

     The rationale behind the condition on LCG selling, assigning, or

transferring the LCG Development Agreement was to assure Argent

that if LCG sold, assigned, or transferred its interest in the LCG



                                   3
Development Agreement to someone else who took over the benefits of

the LCG Development Agreement, then Argent would be repaid either

by LCG or Barnett. CR 745. It was never intended or contemplated

that this condition would be triggered by LCG releasing claims against

the City arising out of or related to the LCG Development Agreement.

CR 745, 867.    Indeed, according to the attorney who negotiated the

Guaranty, it was not discussed in any negotiations in which he

participated that the condition would be triggered by LCG releasing

claims against the City arising out of settlement of litigation related to

the LCG Development Agreement. CR 867.

III. The LCG Development Agreement expires pursuant to its
     own terms on August 6, 2012, and litigation ensues.

     Due to problems with obtaining an appropriate rating of its bonds,

the City could not proceed with its proposed bond package. CR 749.

LCG attempted to work with the City to restructure the financing and

sought an extension of the August 6, 2012 deadline. CR 749. The City

rejected LCG’s proposal to extend the deadline, and the LCG

Development Agreement expired and terminated by its own terms on

August 6, 2012. CR 749, 860.




                                    4
     On August 7, 2012, LCG filed a lawsuit against the City in the

193rd District Court of Dallas County, Texas (the “LCG-City Lawsuit”),

over the termination of the LCG Development Agreement.          CR 749.

LCG sought damages, in excess of $139 million, for the City’s wrongful

conduct that resulted in the termination of the LCG Development

Agreement.   CR 1044-45. Pleading in the alternative, LCG sought

specific performance on the theory that the City should be estopped

from relying on the termination of the LCG Development Agreement.

CR 1045.

     LCG’s   live   pleading,   Plaintiff’s   Third   Amended   Petition,

recognized that the LCG Development Agreement had expired by its

own terms. CR 1021-22. In its Original Answer, the City alleged, “The

development contract between the City and LCG, however, has fully

expired by its own terms.” CR 1053. The City filed a Cross-Motion for

Summary Judgment, in which it stated as an undisputed fact that “the

Closing Date did not occur by August 6, 2012, and the Development

Agreement therefore automatically terminated on that date.” CR 1082.

The City further stated in its motion, “As an initial matter, LCG does




                                    5
not (and cannot) dispute that the Development Agreement expired by

its terms on August 6, 2012.” CR 1108.

      In the LCG-City Lawsuit, LCG sought summary judgment on the

City’s immunity defenses to its claims of money damages for breach of

contract and the alternative remedy of specific performance. CR 1120-

54. On March 18, 2013, the 193rd Court entered an Amended Order that

neither the City’s sovereign immunity defenses nor the Texas Local

Government Code precluded LCG’s claims, without ruling on the merits

of the claims. CR 1575-76. The court further granted permission for an

interlocutory appeal. CR 1576.

IV.   The City makes a deal with a new developer and settles the
      LCG-City Lawsuit.

      On May 9, 2013, the City entered into a Memorandum of

Understanding (the “MOU”) with a new developer, Irving Music

Factory,   LLC   (“IMF”),   to   design,   construct,   and   operate   an

entertainment center on the site that had been covered by LCG’s

Development Agreement. CR 876-91. The MOU stated that the LCG

Development Agreement expired by its terms on August 6, 2012, and

that the City desired to negotiate and enter into a separate and

independent development agreement with IMF. CR 877. The MOU


                                    6
included drawings and renderings depicting IMF’s own independent

plans and concepts for the entertainment center. CR 883-90. IMF later

assigned the MOU, with the City’s consent, to ARK Group of Irving, Inc.

(“ARK”). CR 892-96.

     On July 25, 2013, the City adopted a resolution approving an

Entertainment        Center   Development   Agreement         (the   “ARK

Development Agreement”) between the City and ARK. CR 909. The

resolution expressly stated that the LCG Development Agreement

“terminated by its terms on August 6, 2012.”            Id.     The ARK

Development Agreement—which differed in many respects from the

LCG Development Agreement—also expressly stated that the LCG

Development Agreement “terminated by its terms on August 6, 2012.”

CR 918.     The City further adopted a resolution directing the City

Attorney to take all appropriate action related to settlement of the

LCG-City Lawsuit, which resolution stated that the LCG Development

Agreement “terminated by its terms on August 6, 2012.” CR 976.

     At the same time, the City and LCG entered into a Settlement

Agreement with respect to the LCG-City Lawsuit, which contained the

following recital:



                                   7
          WHEREAS, the LCG Development Agreement
     terminated on August 6, 2012, thereby also terminating
     the Lease; and

CR 749, 1580-81, 1592 (emphasis added).           In the Settlement

Agreement, LCG:

     unconditionally       and    irrevocably   releases     and
     discharges the City . . . from any and all claims, debts,
     demands, actions, causes of action, suits, accounts,
     covenants, contracts, agreements, damages, losses,
     judgments, executions, orders, fees, costs, expenses, and
     liabilities whatsoever of any kind, whether in law or in
     equity, whether now known or unknown, accrued or
     unaccrued, suspected or unsuspected, of any nature
     whatsoever, which the LCG Releasors have or ever had
     against the City . . . from the beginning of time to the
     Effective Date of this Agreement, in any way arising from or
     related to (i) the LCG Development Agreement . . .

CR 1584 (emphasis added). The release was “intended to be a broad,

general release of all claims the LCG Releasors have or could ever have

against the City Released Group.” CR 1585.

     The settlement between LCG and the City was funded by ARK in

order to end the litigation between the City and LCG and clear the way

for ARK to obtain its own development agreement with the City, and

LCG and ARK entered into a separate settlement agreement. CR 749,

1584, 1602. As a result of the Settlement Agreement, the 193rd Court

entered an Agreed Order of Dismissal with Prejudice in the LCG-City


                                  8
Lawsuit on August 5, 2013, in which it dismissed all claims in their

entirety with prejudice. CR 1578.

V.   Argent files suit against LCG and Barnett and the trial
     court properly grants summary judgment in favor of
     Barnett on the Guaranty.

     On November 13, 2013, Argent filed its lawsuit against LCG and

Barnett, alleging that the release of claims in the Settlement

Agreement triggered LCG’s obligations to pay under the Promissory

Note and satisfied the condition precedent to Barnett’s liability under

the Guaranty.    Argent conceded that the other alternative trigger

events under the Promissory Note and Guaranty had not occurred.

Argent moved for summary judgment, which the 193rd Court denied.

CR 86, 717.

     Barnett then moved for summary judgment on the grounds that a

condition precedent to Barnett’s liability under the Guaranty had not

occurred because a release of claims arising under a contract is not a

transfer of the contract and LCG could not have sold, assigned, or

transferred its interest in the LCG Development Agreement because it

had expired by its own terms.       CR 718.   The trial court granted




                                    9
Barnett’s motion and dismissed Argent’s claims against Barnett with

prejudice. CR 1816.

      Because the Promissory Note contained an alternative trigger

event for the maturity date, the passage of December 31, 2014 (CR 863),

LCG stipulated to the entry of an agreed judgment on the Promissory

Note. 2 CR 1808-10.         The Guaranty, however, did not include this

alternative trigger event. CR 868.

      Argent appealed. CR 1811-16.

                     SUMMARY OF THE ARGUMENT

      The court should affirm the trial court’s judgment because

summary judgment was proper in this case. The undisputed evidence

establishes that none of the conditions precedent to Barnett’s

obligations to pay under the Promissory Note or Guaranty occurred.

Argent therefore cannot maintain a claim for breach of the Guaranty

against Barnett.

      LCG simply released its claims against the City relating to the

LCG Development Agreement. Under these circumstances, the plain,


2
  LCG’s interest in this appeal is restricted to the date the promissory note matured,
which determines when default rate interest began accruing. CR 863, 1808-09.
LCG joins in Barnett’s arguments, except the issue of privity for the application of
judicial estoppel.


                                         10
ordinary meanings of “release” and “transfer” are different.       Argent

attempts to evade this distinction by inappropriately conflating claims

arising under a contract with an interest in the contract. By signing the

Settlement Agreement, however, LCG merely released any claims it

had arising under the LCG Development Agreement, which as a matter

of Texas law is not the contract or any right or interest in the contract.

ARK supported this arrangement to end the litigation between LCG

and the City in order to clear the way for its own, new development—

not to acquire an interest in the LCG Development Agreement.

     Furthermore, LCG could not have transferred any interest in the

LCG Development Agreement because it had expired and terminated on

its own terms eleven months before LCG and the City entered into the

Settlement Agreement. LCG repeatedly acknowledged that the LCG

Development Agreement terminated. Argent attempts to suppress this

fact by resorting to judicial estoppel but fails to show that each required

element of judicial estoppel is met: there is no sworn statement, actual

inconsistency, or advantage gained by LCG’s alternative pleading. Nor

was Barnett in privity with LCG. Argent has failed to show that LCG

sold, assigned, or transferred its interest in the LCG Development



                                    11
Agreement and therefore cannot establish that a condition precedent to

Barnett’s liability under the Guaranty has been satisfied. This Court

should therefore affirm the judgment.

                      STANDARD OF REVIEW

     Summary judgments trigger de novo appellate review. See, e.g.,

Buck v. Palmer, 382 S.W.3d 525, 527 (Tex. 2012). Traditional motions

stand if the movant conclusively disproved an opponent’s vital fact or

conclusively proved their own. TEX. R. CIV. P. 166a. If “the evidence is

so weak as to do no more than create a mere surmise or suspicion of a

fact,” an award of summary judgment should be affirmed. King Ranch,

Inc. v. Chapman, 118 S.W.3d 742, 751 (Tex. 2003) (internal quotation

marks omitted). The trial court correctly granted Barnett’s summary

judgment motion under these standards.

                             ARGUMENT

     The trial court properly granted summary judgment because

LCG’s release of claims arising under the LCG Development Agreement

was not a “sale, assignment, or other transfer” of an interest in the LCG

Development Agreement. Nor could LCG have transferred an interest

in the LCG Development Agreement because it expired and terminated



                                   12
by its own terms nearly a year earlier.        Therefore, the condition

precedent to Barnett’s liability under the Guaranty was not satisfied

and Barnett has no liability to Argent.

I.   LCG’s “release” of its claims arising under the LCG
     Development Agreement was not a “transfer” of an interest
     in that contract.

     The parties did not agree that a release of claims against the City

arising under the LCG Development Agreement would trigger LCG’s

obligation to pay or Barnett’s liability under the Guaranty.      In the

Settlement Agreement, LCG only released its claims against the City

relating to the LCG Development Agreement. CR 1584. LCG did not

“release” the LCG Development Agreement itself, and did not purport to

sell, assign, or transfer any interest in the LCG Development

Agreement to anyone. Further, the LCG Development Agreement itself

is distinct from claims that arise under it.

     The plain, ordinary meanings of “transfer” and “release” are

different. The principal definition of “release” is, “Liberation from an

obligation, duty, or demand; the act of giving up a right or claim to the

person against whom it could have been enforced.”          BLACK’S LAW

DICTIONARY 1403 (9th ed. 2009). That concept is distinct and different



                                    13
from the concept of “transferring” something. “Transfer” when used as

a verb means, “1. To convey or remove from one place to another; to

pass or hand over from one to another, esp. to change over the

possession or control of. 2. To sell or give.” Id. at 1636. LCG’s release of

claims arising under the LCG Development Agreement did not convey,

hand over, or change the possession and control of the LCG

Development Agreement to anyone, and was not a “transfer” of an

interest in that contract. Instead, it was the giving up of claims against

the City.   The plain meaning of the language in the Guaranty is

consistent with the parties’ intention at the time the Guaranty was

executed. CR 745, 867.

     Argent’s reliance on Grohman v. Kahlig, 318 S.W.3d 882 (Tex.

2010), is misplaced. Grohman did not decide whether releasing claims

arising under a contract constitutes transferring an interest in the

contract. Grohman, 318 S.W.3d at 888. In fact, there was no “release”

involved in the case at all.      Instead, the issue was whether the

conversion of corporations to limited partnerships constituted a

“transfer” of their stock, and the Court concluded it did not. Id.




                                    14
     The sole reference to “release” in Grohman was in a quote from

Black’s Law Dictionary of one of three alternative definitions of

“transfer” when used as a noun, and in which “release” appears among

several examples of disposing of or parting with an asset. Id. (quoting

BLACK’S LAW DICTIONARY 1636 (9th ed. 2009)). From this quote, Argent

draws the fallacious conclusion that “release” always means “transfer.”

That is an unjustified extrapolation from a quoted definition. Further,

words have different meanings, depending on how they are used.

Another definition of the noun “transfer,” and one applicable here, is, “A

conveyance of property or title from one person to another.” BLACK’S

LAW DICTIONARY 1636 (9th ed. 2009). LCG’s release of claims arising

under the LCG Development Agreement did not convey property or title

to anyone, and was not a “transfer.”

     The single reference to “release” in Grohman is, at most, dictum—

an observation or remark made concerning some rule, principle, or

application of law suggested in a particular case, which observation or

remark is not necessary to the determination of the case. See Edwards

v. Kaye, 9 S.W.3d 310, 314 (Tex. App.—Houston [14th Dist.] 1999, pet.

denied); Lester v. First American Bank, 866 S.W.2d 361, 363 (Tex.



                                   15
App.—Waco 1993, writ denied).           Dictum does not create binding

precedent.   Edwards, 9 S.W.3d at 314; Lester, 866 S.W.2d at 363;

Reynolds-Penland Co. v. Hexter & Lobello, 567 S.W.2d 237, 241 (Tex.

Civ. App.—Dallas 1978, writ dism’d). Broad language in an opinion

that is unnecessary to the court’s decision cannot be considered binding

authority. Kastigar v. U.S., 406 U.S. 441, 454-55 (1972).

     Instead, the binding effect of a prior decision is determined by

reference to the important facts in that case and to the decision actually

made by that court. See Edwards, 9 S.W.3d at 314; Lester, 866 S.W.2d

at 363; Reynolds-Penland, 567 S.W.2d at 241.         A prior decision is

binding precedent only if it addressed the precise question presented in

the current case, and if the facts on which the prior case was based are

substantially similar to those in the current case. Lester, 866 S.W.2d at

363; Carpet Servs., Inc. v. George A. Fuller Co. of Texas, Inc., 802

S.W.2d 343, 344 (Tex. App.—Dallas 1990) (en banc), aff’d, 823 S.W.2d

603 (Tex. 1992).

     Applying these principles to Grohman makes clear that Argent’s

extrapolation of Grohman is incorrect and certainly not controlling in

this case. The precise question here—does releasing of claims arising



                                   16
under a contract constitute transferring an interest in the contract—

was not addressed in Grohman. Nor are the facts of this case remotely

similar to the facts in Grohman. And, the inclusion of “release” among

examples in the definition was not necessary to the Court’s

determination. The result would have been the same if the definition

had omitted the examples, i.e., “Any mode of disposing of or parting

with an asset or an interest in an asset.”

      Argent’s argument that the quotation of one definition in an

opinion is a binding conclusion that such definition—in its entirety—

applies in all cases and circumstances and excludes all other

definitions3 is illogical. And, Argent’s authorities do not support that

proposition. Sims v. State was a criminal case involving a defendant

challenging whether the evidence was legally sufficient to establish he

committed a “constructive transfer” of a controlled substance.               82

S.W.3d 730, 733-34 (Tex. App.—Waco 2002), aff’d, 117 S.W.3d 267 (Tex.

Crim. App. 2003). The court found that the definition of “constructive

transfer” provided by an earlier criminal case was not dictum but rather

necessary to its holding, and applied it against the defendant. Id. at
3
  See BLACK’S LAW DICTIONARY 1403 (setting forth eight different definitions of
“release”) and compare BLACK’S LAW DICTIONARY 1636 (setting forth five different
definitions of “transfer” as a noun and verb).


                                      17
733-34.   Argent’s other authority actually undermines its argument

because the Court found language in its earlier cases to be dicta because

of the differences between those cases and the one before it. Travelers

Indem. Co. of Ill. v. Fuller, 892 S.W.2d 848, 851 n. 3 (Tex. 1995).

     Argent attempts to salvage its “transfer” argument with two

inapposite cases. First, Argent repeats its flawed Grohman argument

with Southtex 66 Pipeline Co. v. Spoor, 238 S.W.3d 538, 548 (Tex.

App.—Houston [14th Dist.] 2007, pet. denied), which quoted the same

definition of “transfer” from Black’s Law Dictionary. Southtex did not

determine whether a release is a transfer, and certainly did not hold

that a release is always a transfer. The issue in Southtex was whether

rights in an easement acquired through a condemnation proceeding

could be assigned through a lease. See Southtex, 238 S.W.3d at 548. As

with Grohman, no release was involved, and therefore the issue was not

integral to or even presented in the determination of that case. See id.

     Next, Argent relies on e2 Creditors’ Trust v. Farris (In re e2

Communications, Inc.), 320 B.R. 849 (Bankr. N.D. Tex. 2004), but fails

to recognize that the court there addressed “whether a release is a

‘transfer’ under the Bankruptcy Code.” e2 Creditors’ Trust, 320 B.R. at



                                    18
856 (emphasis added). The court based its decision on the definition of

“transfer” under the Bankruptcy Code and its legislative history, which

revealed that the definition was drafted to be as broad as possible. Id.

The issue was whether a release of claims constituted a “transfer” for

purposes of fraudulent transfer and preference claims. The court first

concluded that a claim or cause of action is property of the estate, and

then concluded that releasing those claims was a method of disposing of

or parting with those claims. Of course, in this case, what was required

was a “transfer” of an interest in the contract itself, not claims arising

under the contract.

     Claims arising under a contract do not constitute an interest in

the contract.   Texas law distinguishes between a contracting party’s

ability to assign rights under a contract and that party’s ability to

assign causes of action arising from the breach of that contract. See

City of San Antonio v. Valemas, Inc., No. 04-11-00768-CV, 2012 WL

2126932 at *8 (Tex. App.—San Antonio June 13, 2012, no pet.); City of

Brownsville v. AEP Texas Central Co., 348 S.W.3d 348, 358 (Tex. App.—

Dallas 2011, pet. denied); Pagosa Oil and Gas, LLC v. Marrs and Smith

P’ship, 323 S.W.3d 203 (Tex. App.—El Paso 2010, pet. denied). Texas



                                   19
courts uniformly hold that anti-assignment clauses in contracts do not

prohibit a party from assigning causes of action arising from an alleged

breach of the contract. See Dearborn Stove Co. v. Caples, 236 S.W.2d

486, 490 (Tex. 1951); Valemas, 2012 WL 2126932 at *8; AEP Texas, 348

S.W.3d at 358; Pagosa Oil, 323 S.W.3d at 212.

     In the anti-assignment clause in Valemas, Valemas agreed not to

“assign, transfer, convey, sub-let or otherwise dispose of this contract, or

any portion thereof, or any right, title, or interest in, to or under the

same.”   Valemas, 2012 WL 2126932 at *8.          The court held that the

clause did not preclude Valemas from assigning causes of action arising

from an alleged breach of the contract because, “A breach of contract

claim is not a right or interest identified in the contract.” Id. at *8-9.

     If assigning a cause of action for breach of a contract does not

constitute an assignment or transfer of the contract itself or a right or

interest in the contract, then releasing such claims cannot constitute a

transfer of the contract or any right or interest in the contract. LCG did

not sell, assign, or otherwise transfer the LCG Development Agreement

or any interest in the LCG Development Agreement. It simply released

its claims arising under the contract, which as a matter of Texas law is



                                     20
not the contract or any right or interest in the contract. Therefore, the

condition precedent to Barnett’s liability under the Guaranty was not

satisfied.

      Argent repeatedly emphasizes that, according to the Settlement

Agreement, LCG released its “covenants, contracts [and] agreements” in

“any way arising from or related to” the “development agreement.”

Brief at 15, 16, 19.   This is an attempt at misdirection.      The full

language of the Settlement Agreement demonstrates that this provision

“releases” and “discharges” the City from “claims” of whatever kind or

description “arising from” or “related to” the LCG Development

Agreement. CR 1584-86. It does not “transfer” anything to anyone.

And, “contracts” “arising from or related to” the LCG Development

Agreement are distinct from the LCG Development Agreement itself.

Accordingly, the condition precedent to Barnett’s liability under the

Guaranty was not satisfied.

II.   That the City and LCG entered into a settlement
      agreement involving the City’s new developer paying
      money to LCG does not establish that LCG transferred its
      interest in the LCG Development Agreement.

      Argent erroneously argues that the City entering into a

settlement agreement with LCG that (1) involved ARK paying money to


                                   21
LCG and Barnett and (2) cleared the way for ARK to proceed with its

own development agreement for the entertainment center somehow

established LCG transferred its interest in the LCG Development

Agreement to ARK. Brief at 13-14. However, ARK did not acquire or

succeed to any of LCG’s rights under the LCG Development Agreement

by virtue of the Settlement Agreement but instead independently

obtained a new and different development agreement based upon the

MOU it had entered into with the City on May 9, 2013. CR 726-27.

     It is undisputed that the City and LCG entered into the

Settlement Agreement to resolve claims between them in the LCG-City

Lawsuit. CR 726-27, 876, 1580-81, 1584, 1592. The mere fact that ARK

funded the Settlement Agreement to end the litigation between the City

and LCG—including LCG’s $139 million claim for damages for the

termination of the LCG Development Agreement—and clear the way for

ARK to proceed with its own development agreement with the City does

not establish that LCG transferred its interest in the LCG Development

Agreement to ARK. There is a material difference between entering

into a new and independent agreement and assuming an existing




                                 22
agreement. Because this case involves the former, Argent’s inventive

arguments are without merit.

III. LCG did not sell, assign or transfer its interest in the LCG
     Development Agreement because it had expired and
     terminated by its own terms.

     LCG could not have sold, assigned, or transferred any interest in

the LCG Development Agreement when it entered into the Settlement

Agreement with the City because the LCG Development Agreement had

terminated on its own terms on August 6, 2012, almost a year before

LCG and the City entered into the Settlement Agreement.         Judicial

estoppel does not apply and cannot change this result.

     A.    The overwhelming evidence establishes the LCG
           Development Agreement expired before any alleged
           transfer.

     Argent’s claim that LCG transferred its interest in the LCG

Development Agreement when it settled with the City on July 24-25,

2013 fails in light of the undisputed fact that the LCG Development

Agreement expired on its own terms more than eleven months earlier.

See Griffin Indus. Inc. v. Foodmaker, Inc., 22 S.W.3d 33, 36 (Tex. App.—

Houston [14th Dist.] 2000, pet. denied) (“Unlike the mythical Phoenix,

contracts that terminate by their express terms do not rise again.”); see

also Mangione v. Gov’t Personnel Mutual Life Ins. Co., No. 04-01-00655-

                                   23
CV, 2002 WL 1677457, at *3 (Tex. App.—San Antonio July 24, 2002,

pet. denied).   The facts demonstrate that the LCG Development

Agreement terminated on its own terms on August 6, 2012:

  • The LCG Development Agreement, as amended, provided that, “If
    the Closing Date does not occur on or before August 6, 2012, then
    this Agreement automatically terminates without any necessity
    for any further action by either party.” CR 860.

  • The Closing Date did not occur on or before August 6, 2012, and
    the LCG Development Agreement expired and terminated
    pursuant to its own terms on that date. CR 749.

  • The May 9, 2013 MOU between the City and IMF recognized that
    the LCG Development Agreement “terminated by its terms on
    August 6, 2012.” CR 877.

  • The City’s resolution approving the ARK Development Agreement
    expressly stated that the LCG Development Agreement
    “terminated by its terms on August 6, 2012.” CR 909.

  • The ARK Development Agreement contains a recital that the LCG
    Development Agreement “terminated by its terms on August 6,
    2012.” CR 918.

  • In the Settlement Agreement between LCG and the City, the
    parties specifically agreed that, “the LCG Development
    Agreement terminated on August 6, 2012.” CR 1581.

  • The City’s resolution approving the settlement with LCG
    expressly stated that the LCG Development Agreement
    “terminated by its terms on August 6, 2012.” CR 976.

     In the LCG-City Lawsuit, LCG alleged that, “the Development

Agreement would automatically terminate if LCG’s financing was not

closed by August 6, 2012.” CR 1027. It further alleged that the City


                                 24
Council held a special meeting on “August 6, 2012, the final day of the

term of the [LCG] Development Agreement,” to consider a proposed

resolution to extend the term of the agreement, but the resolution was

voted down. CR 1038. It alleged a claim for breach of contract seeking

money damages resulting from the loss of LCG’s rights under the LCG

Development Agreement. CR 1044-45. Pleading in the alternative, it

sought specific performance ordering the City to issue bonds, arguing

that the City by virtue of its conduct should be estopped from arguing

that the LCG Development Agreement had expired. CR 1045.

     Argent does not refute that the LCG Development Agreement, as

amended, provided that, “If the Closing Date does not occur on or before

August 6, 2012, then this Agreement automatically terminates without

any necessity for any further action by either party.” CR 738, 860. It is

further undisputed that the Closing Date did not occur. As admitted by

Argent, the City, ARK, and LCG have consistently represented that the

LCG Development Agreement expired on August 6, 2012 in various

communications, agreements, and resolutions. CR 738-39. Because the

undisputed facts show that the LCG Development Agreement




                                   25
terminated well before the settlement, there was nothing left that could

have been transferred.

        While Argent makes an argument about the “four corners” of the

Settlement Agreement, it overlooks the express language that

eviscerates its argument. The Settlement Agreement expressly states,

“the LCG Development Agreement terminated on August 6, 2012.” CR

1581.      Under Argent’s own authorities, this express language

conclusively    establishes   the   LCG   Development   Agreement   had

terminated.

        Argent points to the fact that ARK funded the Settlement

Agreement between the City and LCG to claim that the LCG

Development Agreement did not expire prior to the alleged “transfer”

that purportedly occurred through the Settlement Agreement. Argent’s

argument that ARK had no other reason to pay Defendants under the

Settlement Agreement is incorrect because it is undisputed that this

payment was actually made to end the litigation between the City and

LCG, including the $139 million claim for termination of the LCG

Development Agreement. The Settlement Agreement itself expressly

provides that “the Parties to this Agreement now desire to resolve their



                                     26
disputes and to compromise and settle all claims which each may have

against the other, without any admission of liability on the part of

anyone.” CR 1581.

     Argent fails to explain how ARK’s intentions to clear the way for

its new development constitutes “an absurd result.” Brief at 16.

However, the plain language of the Guaranty defeats Argent’s claim.

The Guaranty does not obligate Barnett if LCG settled a lawsuit over

the LCG Development Agreement, regardless of who funded the

settlement.   Under the unambiguous language of the Guaranty, the

Court should affirm the trial court’s award of summary judgment.

     B.    Judicial estoppel cannot apply because the required
           elements of estoppel are not met.

     Barnett is not judicially estopped by LCG’s pleading in the

alternative in the LCG-City Lawsuit because the elements for judicial

estoppel are not met. Under Texas law, judicial estoppel requires: “(1) a

sworn, prior inconsistent statement made in a judicial proceeding; (2)

which was successfully maintained in the prior proceeding; (3) not made

inadvertently or by mistake, or pursuant to fraud or duress; and (4)

which is deliberate, clear, and unequivocal.”    Nine Syllables, LLC v.

Evans, No. 05-13-01677-CV, 2015 WL 3932751, at *4 (Tex. App.—


                                   27
Dallas June 26, 2015, no pet. hist.); Galley v. Apollo Associated Servs.,

Ltd., 177 S.W.3d 523, 528-29 (Tex. App.—Houston [1st Dist.] 2005, no

pet.). Judicial estoppel does not apply here for three reasons: (1) there

was no sworn, prior inconsistent statement; (2) the position was not

successfully maintained; and (3) Barnett was not a party or in privity

with a party to the lawsuit.

     If there is no sworn inconsistent statement, judicial estoppel

cannot apply. See Turner v. PV Int’l Corp., 765 S.W.2d 455, 461 (Tex.

App.—Dallas 1988), writ denied, 778 S.W.2d 865 (Tex. 1989);

Metroflight, Inc. v. Shaffer, 581 S.W.2d 704, 709 (Tex. Civ. App.—Dallas

1979, writ ref’d n.r.e.).      Argent can point to no sworn statement,

therefore, judicial estoppel cannot apply.

     Contrary to Argent’s argument, Nine Syllables did not abrogate

this requirement, but recognized that judicial estoppel requires “a

sworn, prior inconsistent statement.”          Nine Syllables, 2015 WL

3932751, at *4 (emphasis added).          The appellant in Nine Syllables

argued that judicial estoppel could not apply because the pleading in

the prior lawsuit was not sworn. Id. at *5. This Court rejected that

argument because the pleading was supported by sworn testimony—



                                     28
live testimony at an injunction hearing and in affidavits.                  Id. (“The

estoppel in this case is not based solely on Jacque’s pleadings in the

prior lawsuit. The estoppel arises from Jacque’s sworn testimony . . .”).

The Court did not endorse the notion proffered by Argent that judicial

estoppel does not require a sworn statement.

      Additionally, if there is no actual inconsistency,4 judicial estoppel

cannot apply. Pleasant Glade Assembly of God v. Schubert, 264 S.W.3d

1, 6-7 (Tex. 2008). Here, there is no actual inconsistency—LCG did not

plead that the LCG Development Agreement had not terminated by its

own terms on August 6, 2012, and indeed, recognized in its pleadings

that it had so terminated. CR 1012-13, 1027. LCG, pleading in the

alternative, alleged that the City should be estopped from arguing that

it had terminated. CR 1045. Reading the pleading as a whole, LCG did

not make a deliberate, clear, and unequivocal statement that the LCG

Development Agreement had not expired on August 6, 2012.



4
 Argent cites Gabarick v. Laurin Maritime (America) Inc., 753 F.3d 550 (5th Cir.
2014) for the proposition that pleading in the alternative does not preclude judicial
estoppel. Gabarick, however, merely points out that judicial estoppel only applies
when all of the elements of estoppel are present. See Gabarick, 753 F.3d at 554
(noting that a court’s reliance on an alternative argument “makes all the
difference.”). In that case, the party had convinced the prior court to accept its prior
position and prevailed on the merits based on that position. Id.


                                          29
     Further, if the party does not gain some advantage by the

statement, e.g., some relief from the prior court, judicial estoppel cannot

apply. See Pleasant Glade, 264 S.W.3d at 8. Also, judicial estoppel does

not apply where the party’s prior claims were dismissed. See Galley,

177 S.W.3d at 529, n. 3. LCG did not obtain any relief on its alternative

claim because the 193rd Court did not rule on the merits of that claim—

it simply ruled that the City’s immunity defenses did not preclude the

claim, and later dismissed those claims.

     Judicial estoppel also does not apply because Barnett was not in

privity with LCG and therefore cannot be bound by LCG’s statements in

the LCG-City Lawsuit. Privity does not exist merely when persons are

interested in the same question, but requires an identity of interest in

the legal right actually litigated.    Texas Real Estate Commission v.

Nagle, 767 S.W.2d 691, 694 (Tex. 1989). Privity connotes those who are

in law so connected with a party to the earlier suit as to have such an

identity of interest that the party represented the same legal right. See

Texas Capital Sec. Mgmt., Inc. v. Sandefer, 80 S.W.3d 260, 266

(Tex.App.—Texarkana 2002, pet. struck). For example, privity does not

exist where a party is involved in both suits but in different capacities.



                                      30
See Flying Diamond-W. Madisonville L.P. v. GW Petroleum, Inc., No.

10-07-00281-CV, 2009 WL 2707405 *6 (Tex. App.—Waco Aug. 26, 2009,

no pet.).

      Barnett did not have an identity of interest with LCG in the legal

rights being litigated in the City-LCG Lawsuit because he was not a

party to and had no legal interest in the LCG Development Agreement.

The fact that his companies had separate agreements with LCG does

not give him a legal interest in LCG’s agreement with the City.

Accordingly, LCG could not have represented his interests. There also

was no evidence that Barnett controlled the prior litigation or was a

successor in interest to LCG. Under these circumstances, there is no

privity. See Bob Short & Assocs., Inc. v. Heritage Res., Inc., No. 05-95-

00472-CV, 1996 WL 223680 *2 (Tex. App.—Dallas Apr. 30, 1996, writ

denied).

      Argent’s reliance on Nine Syllables to assert privity exists here is

misplaced. In that case, a wife joined a bank in her divorce proceeding,

claiming that a note and deed of trust were invalid and subject to

forfeiture because the property was her homestead.        Nine Syllables,

2015 WL 3932751 at *2.          She obtained a temporary injunction



                                   31
preventing the bank from foreclosing. Id. She and her new husband

then formed a company to buy the note and deed of trust from the bank.

Id. at *3.   When the new company demanded payment from the

husband, he filed a lawsuit seeking declaratory judgment that the note

and deed of trust were unenforceable. Id. This Court affirmed the trial

court’s finding that the company was in privity with the wife because

she formed the company for the purpose of acquiring the note and deed

of trust, she signed the purchase agreement on behalf of the company,

she was a part owner and managing member of the company, and she

controlled the company’s actions in the lawsuit. Id. at *6.

     There are no remotely similar facts in this case. Barnett was not

an owner or manager of LCG, did not sign any agreements on behalf of

LCG, and did not control LCG’s actions in the LCG-City Lawsuit.

There was no privity and, for this additional reason, judicial estoppel

does not apply.

                            CONCLUSION

     The trial court correctly awarded Barnett summary judgment.

The facts here conclusively establish that the LCG Development

Agreement terminated by its own terms on August 6, 2012.



                                   32
Consequently, LCG could not have sold, assigned, or transferred the

LCG Development Agreement.        Moreover, regardless of whether the

LCG Development Agreement had terminated or not, the facts

conclusively establish that LCG did not sell, assign, or transfer the LCG

Development Agreement or any interest in it. Texas law distinguishes

between claims arising under a contract and rights or an interest in the

contract. This case involves the former, not the latter. A “release” of

claims arising under a contract is not a “transfer” of a contract or any

interest in it. Accordingly, the Settlement Agreement did not trigger

Barnett’s obligation to pay under the Guaranty, the condition precedent

to Barnett’s performance under the Guaranty did not occur, and the

trial court’s judgment should be affirmed.




                                   33
Date: October 27, 2015        Respectfully submitted,


                              /s/ J. Robert Arnett II
                              J. Robert Arnett II
                              Texas Bar No. 01332900
                              barnett@carterscholer.com
                              CARTER SCHOLER ARNETT
                              HAMADA & MOCKLER, PLLC
                              8150 N. Central Expy., Ste. 500
                              Dallas, Texas 75206
                              Tel: (214)-550-8188
                              Fax: (214)-550-8185

                              ATTORNEY FOR LAS
                              COLINAS GROUP, L.P. AND
                              BILLY BOB BARNETT




                         34
                     CERTIFICATE OF SERVICE

     I certify that on October 27, 2015, I served all counsel of record

with a copy of Appellees’ Brief via the Court’s electronic filing system.


                                         /s/ J. Robert Arnett II
                                         J. Robert Arnett II




                                    35
       CERTIFICATE OF COMPLIANCE WITH RULE 9.4(i)

          Certificate of Compliance with Type-Volume Limitation,
           Typeface Requirements, and Type Style Requirements

     1.     This brief complies with the type-volume limitation of TEX.

R. APP. P. 9.4(i)(2)(B) because this brief contains 6,709 words, excluding

the parts of the brief exempted by TEX. R. APP. P. 9.4(i)(1).

     2.     This brief complies with the typeface requirements of TEX. R.

APP. P. 9.4(e) and the type style requirements of TEX. R. APP. P. 9.4(d)

because this brief has been prepared in a proportionally spaced typeface

using Microsoft Word for Mac 2011 in 14 font size and Century

Schoolbook style.


Date: October 27, 2015                   /s/ J. Robert Arnett II
                                         J. Robert Arnett II
                                         Attorney for Las Colinas Group,
                                         L.P. and Billy Bob Barnett




                                    36
