City wins breach of lease claim against FBO, but quantum meruit claims were remanded

 

Laredo Jet Center, LLC v. City of Laredo, 04-17-00316-CV (Tex. App. – San Antonio, July 25, 2018)

This is an FBO lease dispute where the San Antonio Court of Appeals affirmed-in-part and reversed-in-part a summary judgment motion issued in favor of the City.

Laredo Jet was a fixed-based operator (“FBO”) at the Laredo International Airport. In 2014, the City and Laredo Jet discussed a contract under which Laredo Jet would demolish an existing hangar and rebuild a larger hangar, but Laredo Jet wanted a forty-year lease to secure financing. The City entered into a lease agreement for a term of three years. Under the 2014 lease, Laredo Jet agreed to complete replacing the hangar within three years. In 2015, Laredo Jet and the City entered into a second lease agreement for a term of thirty years; the 2015 lease was contingent upon Laredo Jet constructing the new hangar by August 1, 2017, as required by the 2014 lease. Laredo Jet asserted the City made numerous representations that the full forty-year term would be eventually incorporated.   However, in 2016 Laredo Jet stopped hanger construction asserting its financiers would not provide payments until the forty-years is secured.   The City refused. Laredo Jet sued the City, alleging claims for breach of contract, promissory estoppel, and quantum meruit, among others. The City filed a traditional motion for summary judgment, which was granted. Laredo Jet appealed.

The court of appeals first held JP court has exclusive jurisdiction for forcable entry and detainer cases, so the district court lacked jurisdiction to determine immediate possession rights. It next held Laredo Jet did not expressly responds to the City’s breach of contract and declaratory claims, so they waived the ability to argue them on appeal. The court then determined the City is immune from Laredo Jet’s estoppel arguments. However, in its motion for summary judgment, the City did not challenge any of the elements of quantum meruit arguing, Laredo Jet could not recover in quantum meruit when an express contract existed. However, there is an exception for “building or construction contracts.” The City failed to conclusively establish its entitlement to judgment as a matter of law on Laredo Jet’s quantum meruit claim.  As a result, the court reversed and remanded the quantum meruit and immediate possession claims and affirmed the remainder.

If you would like to read this opinion, click here. Panel consists of Justice Alvarez, Justice Chapa and Justice Rios.  Memorandum Opinion by Justice Chapa. The attorneys listed for Laredo Jet are Doanh T. Nguyen  and Carlos M. Zaffirini Sr.  The attorneys listed for the City are Lisa M Paul, Alyssa Castillon and Kristina Laurel-Hale