                                 IN THE
                         TENTH COURT OF APPEALS

                                No. 10-07-00233-CV

JOE L. SANDERS, JR. AND WIFE
KATHY F. SANDERS,
                                                           Appellants
v.

HOUSEHOLD MORTGAGE SERVICES, INC.
AND MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC.,
                                                           Appellees


                           From the 19th District Court
                            McLennan County, Texas
                           Trial Court No. 2005-2618-1


                          MEMORANDUM OPINION


      Joe and Kathy Sanders appeal from the trial court’s granting of a summary

judgment against them pursuant to Texas Rule of Civil Procedure 166a. TEX. R. CIV.

PROC. 166a. We affirm.

      The order the Sanderses appeal from is entitled “Order Granting Defendant’s

Motion for Summary Judgment.” Household Mortgage Services, Inc. and Mortgage

Electronic Registration Systems, Inc. (hereinafter referred to as “Household”) filed two
separate motions for summary judgment. One was a traditional motion for summary

judgment pursuant to Texas Rule of Civil Procedure 166a(b). TEX. R. CIV. PROC. 166a(b).

The other motion was a no-evidence motion for summary judgment pursuant to Texas

Rule of Civil Procedure 166a(i). TEX. R. CIV. PROC. 166a(i). The trial court’s order is

unclear as to which of Household’s two motions for summary judgment the court

granted; therefore, the trial court’s judgment will be upheld if any theory is meritorious.

State Farm Fire & Cas. Co. v. S.S., 858 S.W.2d 374, 380 (Tex. 1993); Larsen v. Carlene

Langford & Assocs., Inc., 41 S.W.3d 245, 249 (Tex. App.—Waco 2001, pet. denied); Thomas

v. Carpet Mills of America, 156 S.W.3d 681, 683 (Tex. App.—Dallas, 2005, no pet.).

Standard of Review

No-evidence Summary Judgment

       A no-evidence summary judgment is treated as essentially a pretrial directed

verdict. Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997). After an

adequate time for discovery has passed, a party without the burden of proof at trial

may move for summary judgment on the ground that the nonmoving party lacks

supporting evidence for one or more essential elements of its claim. See TEX. R. CIV. P.

166a(i); Espalin v. Children's Med. Ctr. of Dallas, 27 S.W.3d 675, 682-83 (Tex. App.—Dallas

2000, no pet.). A party should not move for no-evidence summary judgment based on

an affirmative defense that it has the burden to prove at trial. See Nowak v. DAS Inv.

Corp., 110 S.W.3d 677, 680 (Tex. App.—Houston [14th Dist.] 2003, no pet.). The moving

party must file a motion that specifies which elements of the nonmoving party's claim

lack supporting evidence. TEX. R. CIV. P. 166a(i). Once a proper motion is filed, the

Sanders v. Household Mortgage                                                        Page 2
burden shifts to the nonmoving party to present evidence raising any issues of material

fact. Murray v. Ford Motor Co., 97 S.W.3d 888, 890-91 (Tex. App.—Dallas 2003, no pet.).

We review the evidence in the light most favorable to the party against whom the

summary judgment was rendered. Johnson v. Brewer & Pritchard, P.C., 73 S.W.3d 193,

208 (Tex. 2002).

       A no-evidence summary judgment is properly granted if the non-movant fails to

bring forth more than a scintilla of probative evidence to raise a genuine issue of

material fact as to an essential element of the non-movant's claim on which the non-

movant would have the burden of proof at trial. See TEX. R. CIV. P. 166a(i); Merrell Dow

Pharms. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997). If the evidence supporting a finding

rises to a level that would enable reasonable, fair-minded persons to differ in their

conclusions, then more than a scintilla of evidence exists. Havner, 953 S.W.2d at 711.

Less than a scintilla of evidence exists when the evidence is "so weak as to do no more

than create a mere surmise or suspicion" of a fact, and the legal effect is that there is no

evidence. Kindred v. Con/Chem, Inc., 650 S.W.2d 61, 63 (Tex. 1983).

Did the order properly dispose of all issues between the parties?

       The Sanderses’ first issue and second issue are closely related so we will address

them together. First, the Sanderses complain that the no-evidence motion for summary

judgment did not dispose of all issues and therefore the order granting a summary

judgment that all causes of action between the parties were dismissed with prejudice

was improper. Second, the Sanderses complain that they produced sufficient summary

judgment evidence to raise a fact issue on their fraud and claim of title causes of action.

Sanders v. Household Mortgage                                                         Page 3
       The Sanderses’ petition alleges a breach of contract, fraud, usury, and prays for a

declaration that the Sanderses’ debt be discharged in full as to Household due to their

usurious conduct. In order to determine whether the trial court’s decision may be

upheld, we must consider each separate cause of action and the factual history of the

parties.

Factual history

       The Sanderses entered into a contract with Household to finance their residence

in 2000. This contract required the Sanderses to pay their property taxes directly to each

taxing authority. The Sanderses did not make these payments for the years 2001 and

2002. The Sanderses were sued by the La Vega Independent School District in 2002 for

delinquent taxes. The trial court granted judgment for the school district and ordered

that the property be sold by foreclosure. The property was foreclosed on May 6, 2003 to

a third party. The property was conveyed back to Household by the third party on

October 29, 2003. These facts are not in dispute and the Sanderses do not challenge the

validity of the tax foreclosure sale.

       The Sanderses allege that Household agreed to pay their property tax

delinquency by adding it to their house note whereby they would repay the amount

over three years. The Sanderses further allege that Household began billing them at a

higher rate on May 6, 2003, and that they made the higher payments. These allegations

form the basis for the Sanderses claim for relief. Household disputes that there was

ever an agreement to pay the property taxes.




Sanders v. Household Mortgage                                                       Page 4
The No-Evidence Motion for Summary Judgment

       The no-evidence motion as filed by Household challenges the evidence regarding

whether Household entered into an agreement with the Sanderses to add the back taxes

to the mortgage payments; whether Household was to pay the past due taxes; whether

a breach of contract would exist if there was no agreement; and whether Household’s

conduct was usurious.

Breach of Contract

       To establish a claim for breach of contract, the Sanderses must first establish the

existence of a valid contract. Williams v. First Tenn. Nat'l Corp., 97 S.W.3d 798, 802-03

(Tex. App.—Dallas 2003, no pet.); Coleman v. Revak, 2008 Tex. App. LEXIS 4608 (Tex.

App.—Houston [1st Dist.], 2008, no pet.).        The question of whether an alleged

agreement constitutes an enforceable contract is generally a question of law. See Meru v.

Huerta, 136 S.W.3d 383, 390 (Tex. App.—Corpus Christi 2004, no pet.).

       The elements of a valid and enforceable contract are: (1) an offer; (2) an

acceptance in strict compliance with the terms of the offer; (3) a meeting of the minds;

(4) each party's consent to the terms; and (5) execution and delivery of the contract with

the intent that it be mutual and binding. See Hubbard v. Shankle, 138 S.W.3d 474, 481

(Tex. App.—Fort Worth 2004, pet. denied). The necessary elements of both written and

oral contracts are the same and must be present for a contract to be binding. Id.

       A contract must be sufficiently definite in its terms so that a court can

understand what the promisor undertook.          See Meru, 136 S.W.3d at 390.       If the

agreement upon which the plaintiff relies is so indefinite as to make it impossible for

Sanders v. Household Mortgage                                                       Page 5
the court to determine the legal obligations and liabilities of the parties, it is not an

enforceable contract. Id. Furthermore, to be legally binding, the parties must have a

meeting of the minds and must communicate consent to the terms of the agreement. Id.

       In a contract to loan money, which is in essence what the Sanderses claim, the

material terms will generally be: the amount to be loaned, maturity date of the loan, the

interest rate, and the repayment terms. T.O. Stanley Boot Co. v. Bank of El Paso, 847

S.W.2d 218, 221 (Tex. 1992); Wheeler v. White, 398 S.W.2d 93, 95 (Tex. 1965). When there

is no evidence of a material term of a contract, the contract fails for indefiniteness. T.O.

Stanley, 847 S.W.2d at 221-222.

       The only evidence brought forth by the Sanderses to support an agreement

between the Sanderses and Household is the affidavit of Appellant, Kathy Sanders, and

an attached billing statement from Household dated November 14, 2003.              The tax

foreclosure sale took place on May 6, 2003. Household objected to the consideration of

the billing statement at the hearing before the trial court; however, they did not seek a

ruling on the objection and therefore did not preserve it for purposes of appeal. TEX. R.

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

       The question then becomes whether this evidence is more than a scintilla of

probative evidence of an agreement for Household to, in essence, loan the money to the

Sanderses to pay the past due taxes by paying them to a third party. Reviewing the

evidence presented by the Sanderses in the light most favorable to the Sanderses, we

find that the evidence before the trial court does no more than “create a mere surmise or

suspicion.” Kindred, 650 S.W.2d at 63.

Sanders v. Household Mortgage                                                         Page 6
        The only issues raised in Household’s no-evidence summary judgment motion

regarding a breach of contract are the existence of an agreement to pay the property

taxes or to add the amount to the Sanderses mortgage, without which there would be

no breach. There is no evidence as to the interest rate to be charged for this loan of

money by Household and only a vague reference of “almost $5,500.00” as the amount to

be loaned by Household to pay the taxes. There is no evidence as to when this loan was

to take place or that Household even had any knowledge to which taxing authority this

sum of money was to be paid.

        To defeat a no-evidence summary judgment, the Sanderses would have to put

forth probative evidence as to each element to determine the validity of the contract.

Even if we accept as true the summary judgment evidence produced by the Sanderses

in their response to the motion, we find that the contract is too indefinite to be

enforceable. We find that it is not a valid, enforceable contract, and therefore, summary

judgment was proper as to the breach of contract cause of action as there is insufficient

evidence of an agreement between the Sanderses and Household.

Fraud

        To prove common law fraud, a plaintiff must establish: (1) the defendant made a

material representation; (2) which was false; (3) the defendant made the representation

knowing it to be false or made it recklessly as a positive assertion without any

knowledge of its truth; (4) the defendant intended that the plaintiff act upon the

representation; (5) the plaintiff acted in reliance upon the representation; and (6)

suffered injury as a result. Brush v. Reata Oil & Gas Corp., 984 S.W.2d 720, 726 (Tex.

Sanders v. Household Mortgage                                                      Page 7
App.—Waco 1998, pet. denied); Eagle Properties, Ltd. v. Scharbauer, 807 S.W.2d 714, 723

(Tex. 1990)

       The Sanderses rely on Texas Business and Commerce Code Section 27.01 which

creates a statutory cause of action for fraud in real estate transactions. However, as the

Sanderses’ claim is not based on the sale of real estate, it does not fall within the

purview of Section 27.01. TEX. BUS. & COM. C. § 27.01 (Vernon 2008). See Burleson State

Bank v. Plunkett, 27 S.W.3d 605, 611 (Tex. App.—Waco 2000, no pet.).              A loan

transaction, as this would be, even if secured by land, is not considered to come under

the statute. Id.

       Appellees no-evidence motion for summary judgment contains only a general

statement that “Plaintiffs have no competent summary judgment evidence to support

their claims that the Defendants actions of the Defendants [sic] were fraudulent…” This

is no more than a general reference to the cause of action of fraud, however, in order to

preserve this issue for appeal, the Sanderses were required to object to the form of the

motion in their written response to the motion or in some other pleading. Williams v.

Bank One, 15 S.W.3d 110, 117 (Tex. App.—Waco 1999, no pet.). See Westchester Fire Ins.

Co. v. Alvarez, 576 S.W.2d 771, 773 (Tex. 1978).

       Therefore, we must look to each of the common law elements of fraud to

determine if the Sanderses produced more than a mere scintilla of evidence for each

one. The Sanderses produced no evidence of any kind as to whether a representation

was made that the maker knew was false or that it was made recklessly as a positive

assertion without any knowledge of its truth. As such, there is no evidence as to one of

Sanders v. Household Mortgage                                                       Page 8
the elements of common law fraud. We cannot say it was error for the trial court to

have granted the no-evidence summary judgment as to the cause of action for fraud.

Usury

        The Sanderses do not complain about the granting of summary judgment

regarding usury in their brief on the merits, therefore that issue is waived and not

properly before us. TEX. R. APP. P. 38.1(f). The cause of action relating to the discharge

of the debt by the Sanderses’ pleadings requires a finding that Household engaged in

usurious conduct. Since summary judgment was proper on the issue of usury due to

waiver, the discharge of the Sanderses’ debt cause of action is also waived. 1 Summary

judgment was properly granted on these causes of action. Jacobs v. Satterwhite, 65

S.W.3d 653, 655-656 (Tex. 2001); Ontiveros v. Flores, 218 S.W.3d 70 (Tex. 2007).

        We find that the summary judgment order did dispose of all claims and was

properly granted as to each claim based on Household’s no-evidence summary

judgment motion. As such, it is not necessary to address the issue of the traditional

motion for summary judgment.                The Sanderses issues number one and two are

overruled.

Redemption by Household

        The Sanderses’ third issue deals with whether the no-evidence motion for

summary judgment should have been denied because the Sanderses were the owners of

the property due to Household’s purchase of their residence, which the Sanderses



1Appellant’s original petition avers that “due to the usurious claims of the Defendants the obligation that
they have claimed as against the Plaintiffs be fully and completely discharged.”

Sanders v. Household Mortgage                                                                       Page 9
contend constitutes a redemption pursuant to Texas Tax Code Section 34.21. TEX. TAX

C. §34.21 (Vernon 2008).

       The question of whether a redemption was made by Household would constitute

an entirely new cause of action, which is required to be set forth in a pleading pursuant

to Texas Rule of Civil Procedure 47.        TEX. R. CIV. P. 47.    While the response of

Household to the Sanderses’ response to the motion for summary judgment did not

address the issue of redemption, the issue was discussed at some length in the hearing

on the summary judgment. The no-evidence motion for summary judgment could not

have contemplated an entirely new cause of action that was not pled by the Sanderses.

       A petition must give "fair and adequate notice of the facts upon which the

pleader bases his claim." Roark v. Allen, 633 S.W.2d 804, 810 (Tex. 1982). The Sanderses

pleading does not refer in any manner to a redemption by Household.

       Generally, pleadings should not be read too restrictively. Smithkline Beecham v.

Doe, 903 S.W.2d 347, 354 (Tex. 1995). “A court should uphold the petition as to a cause

of action that may be reasonably inferred from what is specifically stated, even if an

element of the cause of action is not specifically alleged." Boyles v. Kerr, 855 S.W.2d 593,

601 (Tex. 1993) (citing Roark, 633 S.W.2d at 809). Yet, pleadings must give reasonable

notice of the claims asserted. In Boyles, for example, the Texas Supreme Court held that

a claim for grossly negligent infliction of emotional distress could not reasonably be

inferred from allegations of simple negligent infliction of emotional distress. Id. In

Smithkline Beecham, the Texas Supreme Court held that a claim for negligent

misrepresentation could not be inferred from allegations of negligence and tortuous

Sanders v. Household Mortgage                                                        Page 10
interference because there was no mention of any misrepresentation. By contrast, in

Roark, the Texas Supreme Court read in allegations against a physician that a child

sustained a fractured skull during delivery to assert an action for the negligent use of

forceps. Roark, 633 S.W.2d at 810. Likewise, an allegation of proximate cause is rather

obviously included in an allegation of sole cause because a sole cause must also be a

proximate cause. Gulf, Colo. & S.F. Ry. v. Bliss, 368 S.W.2d 594, 599 (Tex. 1963).

         This case is more like Smithkline Beecham and Boyles than Roark or Gulf. Looking

at the entirety of the Sanderses’ petition, there simply is no way to infer a claim of

redemption in the Sanderses’ petition. The Sanderses never amended their petition to

add the new cause of action, although it seems to have been the cornerstone of their

argument at the motion for summary judgment hearing. We overrule issue number

three.

Conclusion

         Having found no error in the trial court’s order granting summary judgment, we

affirm the trial court’s decision.



                                           TOM GRAY
                                           Chief Justice

Before Chief Justice Gray,
       Justice Reyna, and
       Justice Davis
Affirmed
Opinion delivered and filed July 1, 2009
[CV06]



Sanders v. Household Mortgage                                                        Page 11
