author: CHARLES KREGER, Justice.

text:
    Leroy Ernest GREGORY, Jr., Appellant, v. The STATE of Texas, Appellee.
    No. 09-04-132-CR.
    Court of Appeals of Texas, Beaumont.
    Submitted Jan. 26, 2005.
    Decided March 2, 2005.

      Dexter M. Patterson, The Woodlands, for appellant.
    Michael A. McDougal, Dist. Atty., Michael Tiffin, Patty Maginnis, Michael C. Young, Asst. Dist. Atty’s, Conroe, for state.
    Before GAULTNEY, KREGER, and HORTON, JJ.
   OPINION

CHARLES KREGER, Justice.

A jury convicted Leroy Ernest Gregory, Jr. of possession of a controlled substance, methamphetamine, and possession of an immediate precursor, pseudoephedrine, with intent to unlawfully manufacture methamphetamine. Gregory pleaded true to two enhancement paragraphs. The trial court found both enhancement paragraphs true and on each count sentenced Gregory to imprisonment for life in the Texas Department of Criminal Justice, Institutional Division, the sentences to be served concurrently.

Gregory appeals raising three points of error. In his first two points, Gregory claims the evidence is legally and factually insufficient to support his conviction on both counts of possession. We first note that Gregory was charged in a single indictment along with Clyde Dorsey, Jr., Robby Dale Hon, and Cody Hamilton. Gregory was tried separately and a parties charge was given to the jury. The thrust of Gregory’s argument is that the State failed to meet its burden to establish he, as opposed to his co-defendants, was in possession of either methamphetamine or pseudoephedrine.

Possession is defined as “actual care, custody, control or management.” Tex. Pen.Code Ann. § 1.07(a)(39) (Vernon Supp.2005). To meet its burden, the State must establish Gregory exercised actual care, control and management over the contraband and had knowledge the substance in his possession was contraband. See King v. State, 895 S.W.2d 701, 703 (Tex.Crim.App.1995)(citing Martin v. State, 753 S.W.2d 384, 387 (Tex.Crim.App.1988)).

Sergeant Larry Bonds testified that he, along with Deputy Mike White, Deputy Ray Zavadil and Deputy Chilcutt, proceeded to a residence to serve a felony warrant on Hamilton. Present at the residence were Gregory, Dorsey, Hon, and Hamilton. Dorsey, the property owner, gave Bonds permission to enter. Upon entering the residence, Bonds noticed there was “no lighting in the house at all” and smelled an unfamiliar odor. He further observed Gregory laying on the couch to the left of the front door. Hamilton was found in a corner in the right-hand back room. After finding Hamilton, the officers brought everyone outside.

Upon Dorsey’s request, Deputy Zavadil escorted him inside the residence to the right-hand back room to retrieve his glasses. In plain view, Deputy Zavadil found what appeared to be a marijuana cigarette, a mirror with a white powdery substance and a razor blade laying on it, pipes, such as are used to smoke marijuana, and hypodermic syringes. Zavadil also found what he recognized as marijuana and a device used to roll cigarettes in a can at the edge of the bed. While searching for other occupants in the remaining rooms, Zavadil found more syringes laying around and a planter with a fluorescent light on it and marijuana plants growing in it. Zavadil also saw a clear bottle sitting on the floor. It had a separated liquid in it which Zava-dil recognized as a possible by-product of a methamphetamine lab. Zavadil further noted a chemical smell in the house. The Special Investigative Unit (SIU) for the Drug Task Force was called to process the scene. Bonds testified the reason for calling SIU was the odor that was later clarified as methamphetamine.

In the immediate area outside the residence was a burn pile that had several empty blister packs of cold medication in various stages of incineration. Officers also found a well-traveled path to a small pup tent. Zavadil noted a chemical smell in the tent and a five-gallon bucket with two-liter plastic bottles containing a clear liquid.

Philip Cash, a detective with the Montgomery County Sheriffs Department, SIU, testified there was a clandestine methamphetamine laboratory at the residence. He described it as a red phosphorous, iodine, pseudoephedrine reduction laboratory. Cash testified everything needed to manufacture methamphetamine was present. The laboratory appeared to have been functioning and some of the components had been boxed, indicating an operation had occurred there. Cash found Ziploc bags containing a powdery substance. He testified the bags are used in the trafficking end; the drugs are pre-weighed and put in Ziploc bags for sale and distribution. A plastic-like tote box containing hose, gallon-size solvent cans, sports bottles that had substances in them, and plastic hose stained from use, was found in the living room, where Gregory was found. The kitchen area opened up into the living room. In the kitchen, Red Devil lye and sodium hydroxide were sitting on the stove, along with a sports bottle containing a blue-colored liquid (a solvent of some type). Cash testified it was unusual to see a solvent in such a location because it is very flammable. There was also small Pyrex glassware, which is preferred because it holds heat in the microwave. Cash testified,

The cooking process was not going on at the time like when they boil it in the flask, but the plastic bottles had solvents in them, and the liquids had separation. We also had plastic bottles that had the pseudoephedrine, and when they took the separation of the pseudo from the pills, the binder was still in the bottles. They had the seal taped on there where they poured the solvent out and left the binder in the bottle which was an indication that it had occurred. But the actual steps they were in, I couldn’t tell you what process other than I know the actual cooking process had been done.

Cash could not say when the cooking process took place. Cash testified there were items containing pseudoephedrine recovered at the scene.

A latent print was obtained from a quart-sized Coca-Cola bottle found on the floor of the back bedroom on the left side of the house. That print was matched to the ring finger on Gregory’s right hand and the substance in the bottle tested positive for ephedrine.

Cash testified he was given drivers’ licenses when he arrived at the scene. Gregory’s license was admitted into evidence as State’s Exhibit 19. The address on Gregory’s license is directly across the street from Dorsey’s residence. Cash testified it was common for people involved in this activity to have or use different identifications. State’s Exhibit 30 was then admitted into evidence over Gregory’s objection. It is a Texas Driver’s license with the name of Manuel A. Rodriquez and a Houston address. Both State’s Exhibit 19 and 30 have Gregory’s photograph.

Detective Robert Clark was called to the residence to investigate a possible clandestine methamphetamine lab. Clark videotaped the location. Clark found a burn pile and testified they typically encounter clandestine methamphetamine labs where they attempt to destroy evidence by burning it. Usually, they find pseudoephedrine packages, blister packages, empty fuel cans, and things of that nature. The camp site was found by following the path to the woods behind the residence. There was a two-liter soda bottle with some type of solvent in it, possibly containing methamphetamine or another step in the cooking process. Clark testified it was common for soda bottles to be used in manufacturing methamphetamine. According to Clark, items removed from the camp site, such as coffee filters, solvents, and red phosphorous, are commonly used in manufacturing methamphetamine. Clark identified a crystal white powder as either processed pseudoephedrine or ephedrine, or finished methamphetamine. Inside the residence, Clark found Red Devil lye, a drain cleaner used to balance the pH when manufacturing methamphetamine. A “box lab,” a common way to transport a lab, was found on the floor. Empty pseudoephed-rine boxes and blister packs, which Clark identified as the precursor for manufacturing methamphetamine, were found in greater quantity than would be consistent with personal consumption. Sergeant David Holden testified crushed pseu-doephedrine tablets were found at the scene. Clark found a soda bottle, commonly used as a reaction vessel to separate solutions. He also testified pseudoephed-rine is processed to separate the ephedrine. A triple-beam scale was found. There were cases of matches, commonly found in methamphetamine labs utilizing red phosphorous to manufacture methamphetamine. Clark testified a large quantity of matches are required to obtain the necessary amount of red phosphorous.

Minh Nguyen, a chemist for the Department of Public Safety Crime Lab in Houston, Texas, performed an analysis of 95 percent of the exhibits submitted to him, the remaining samples only had a trace amount. The samples were positive for methamphetamine (959.07 grams), iodine (19.19 grams), and ephedrine (905.09 grams). Nguyen testified that while pseu-doephedrine was found in some of the methamphetamine samples, all of the exhibits contained either pseudoephedrine or methamphetamine.

Because Gregory was not in exclusive possession of the place where the contraband was found, it cannot be concluded he had knowledge or control over the contraband unless there are additional independent facts and circumstances affirmatively linking him to the contraband. See Brown v. State, 911 S.W.2d 744, 748 (Tex.Crim.App.1995). Evidence affirmatively linking the accused to the contraband will suffice for proof that he possessed it knowingly. See Wootton v. State, 132 S.W.3d 80, 86-87 (Tex.App.-Houston [14th Dist.] 2004, pet. ref'd).

This Court has recognized the following as factors tending to establish affirmative links:

(1) the contraband was in plain view;
(2) the accused was the owner of the premises in which the contraband was found;
(3) the contraband was conveniently accessible to the accused;
(4) the contraband was found in close proximity to the accused;
(5) a strong residual odor of the contraband was present;
(6) paraphernalia to use the contraband was in view or found near the accused;
(7) the physical condition of the accused indicated recent consumption of the contraband in question;
(8) conduct by the accused indicated a consciousness of guilt;
(9) the accused had a special connection to the contraband;
(10) the place where the contraband was found was enclosed;
(11) the occupants of the premises gave conflicting statements about relevant matters; and
(12) affirmative statements connect the accused to the contraband.

Nixon v. State, 928 S.W.2d 212, 215 (Tex.App.-Beaumont 1996, no pet.). See also Watson v. State, 861 S.W.2d 410, 414-15 (Tex.App.-Beaumont 1993, pet. ref'd). Another factor is the amount of drugs found. See Porter v. State, 873 S.W.2d 729, 733 (Tex.App.-Dallas 1994, pet. ref'd). “The number of factors present is not as important as the logical force the factors have in establishing the elements of the offense.” Gilbert v. State, 874 S.W.2d 290, 298 (Tex.App.-Houston [1st Dist.] 1994, pet. refd). Although the evidence used to satisfy these elements may be direct or circumstantial, the State must establish the accused’s connection with the controlled substance and/or contraband was more than just fortuitous. See Wootton, 132 S.W.3d at 86-87 (citing Brown v. State, 911 S.W.2d 744, 747 (Tex.Crim.App.1995)). “Mere presence at a place where contraband is being used or possessed does not justify a finding of joint possession. Nunn v. State, 640 S.W.2d 304, 305 (Tex.Crim.App.1982).” Wootton, 132 S.W.3d at 87. The State’s evidence must show facts and circumstances that, viewed in the totality of the circumstances, indicate the defendant’s knowledge and control over the drugs, but the evidence need not be so strong that it excludes every other outstanding reasonable hypothesis except the defendant’s guilt. See Brown, 911 S.W.2d at 748; Hyett v. State, 58 S.W.3d 826, 830 (Tex.App.-Houston [14th Dist.] 2001, pet. ref'd).

The evidence affirmatively linking Gregory to the contraband showed the contraband was in plain view, conveniently accessible to and in close proximity to the accused, an odor of contraband and paraphernalia to use the contraband were present, the place where the contraband was found was enclosed, and the amount of contraband was large. The bottle with Gregory’s fingerprint was located inside the residence, an area not generally accessible to the public, and contained a precursor. After reviewing all of the evidence in the light most favorable to the verdict, we conclude a rational trier of fact could have found the essential elements of the offenses beyond a reasonable doubt. See Swearingen v. State, 101 S.W.3d 89, 95 (Tex.Crim.App.2003). Point of error two is overruled.

In evaluating Gregory’s factual-sufficiency challenge, we discuss the evidence he claims is most important in allegedly undermining the jury’s verdict. See Sims v. State, 99 S.W.3d 600, 603 (Tex.Crim.App.2003). Gregory points to the fact the soda bottle with his fingerprint on it was found in another room and there was no evidence as to when the print was left on the bottle. While it is certainly possible Gregory possessed the bottle before it contained ephedrine, it was within the province of the jury to resolve such theories. Additionally, Gregory notes that Ngyuen testified the soda bottle with his fingerprint on it contained ephedrine, rather than pseu-doephedrine. Gregory complains there was no evidence presented as to where the packages of pseudoephedrine and the crushed pseudoephedrine were recovered and no attempt was made to link them to him. The bottle with Gregory’s print on it contained the precursor ephedrine. In addition to that present at the scene, all the evidence suggests the ephedrine came from a substantial quantity of pseu-doephedrine that had already been processed. Gregory also points out that three deputies entered the room he was in and made no discovery of drugs, drug paraphernalia, or the lab box. The record reflects both Bonds and Zavadil testified as to how dark it was inside the residence. Zavadil testified the back room was lit from sunlight, otherwise it was “very dark.” Further, Bonds testified he did not search the house but instead, called the Special Investigation Unit and simply awaited their arrival to process the scene. Upon considering all the evidence in a neutral light, we find the evidence supporting the verdict is not too weak to support the jury’s finding of guilty beyond a reasonable doubt. See Zuniga v. State, 144 S.W.3d 477, 484-85 (Tex.Crim.App.2004). Further, the evidence contrary to the verdict is not so strong that the beyond-a-reasonable-doubt standard could not have been met. Accordingly, the jury was rationally justified in finding guilt beyond a reasonable doubt. Id. at 485. Point of error one is overruled.

Point of error three argues the trial court erred in admitting the altered driver’s license into evidence. The decision to admit or exclude evidence is a matter within the discretion of the trial court. See Owens-Corning Fiberglas Corp. v. Malone, 972 S.W.2d 35, 43 (Tex.1998). The trial court is given wide latitude to admit or exclude evidence of extraneous misconduct. See Montgomery v. State, 810 S.W.2d 372, 390 (Tex.Crim.App.1990). So long as the trial court operates within the boundaries of its discretion, an appellate court should not disturb its ruling, whatever it may be. Id. The trial court abuses its discretion when it acts in an unreasonable or arbitrary manner or acts without reference to any guiding principles. See Beaumont Bank, N.A. v. Bullet, 806 S.W.2d 223, 226 (Tex.1991).

Defense counsel objected to the evidence on the grounds of relevance and that it was more prejudicial than probative. See Tex.R. Evid. 402, 403. Counsel also noted that possession of a forged government document is an extraneous offense. See Tex.R. Evid. 404(b).

According to Cash, it is common for people involved in manufacturing methamphetamine to use false identification, for renting hotel rooms or buying certain chemicals. In his brief, Gregory argues there was no evidence he had used it for that purpose. We agree, but that is not the issue. There was evidence Gregory possessed an altered license, and that evidence was admissible to demonstrate Gregory’s involvement in the clandestine laboratory, viz intent, preparation, plan, and knowledge, as well as absence of mistake or accident. See Tex.R. Evid. 404(b). Therefore it was relevant. See Tex.R. Evid. 401, 402. In light of the offense charged and the evidence adduced at trial, we cannot say the evidence Gregory possessed a bogus license unfairly prejudiced the jury or confused the issues. Accordingly, we find the trial court did not abuse its discretion in admitting the evidence. See Powell v. State, 63 S.W.3d 435, 438 (Tex.Crim.App.2001).

Gregory further asserts the trial court erred in overruling counsel’s request for a limiting instruction at the time the evidence was admitted. In accordance with Jones v. State, 944 S.W.2d 642, 653-54 (Tex.Crim.App.1996), we conclude the trial court erred in failing to grant counsel’s request for a limiting instruction at the time the evidence was introduced. The error, however, is non-constitutional. See Jones v. State, 119 S.W.3d 412, 423-24 (Tex.App.-Fort Worth 2003, no pet.); Lemmons v. State, 75 S.W.3d 513, 524-25 (Tex.App.-San Antonio 2002, pet. ref'd). A non-constitutional error is harmless unless a substantial right is affected. See Lemmons, 75 S.W.3d at 524-25; Tex.R.App. P. 44.2(b). A substantial right is affected when the error had a substantial and injurious effect or influence on the jury’s verdict. See Rankin v. State, 995 S.W.2d 210, 215 (Tex.App.-Houston [14th Dist] 1999, pet. ref d). “A criminal conviction should not be overturned for non-constitutional error if the appellate court, after examining the record as a whole, has a fair assurance that the error did not influence the jury, or had but a slight effect.” Lemmons, 75 S.W.3d at 524-25.

Gregory alleges on appeal this error harmed him because the jury probably considered it evidence that he had altered the license for the purpose of possessing and manufacturing drugs. Gregory received a limiting instruction in the charge, reducing the risk the jury might misuse the evidence during deliberations. Jones, 944 S.W.2d at 654. There was a relatively short interval between admission of the evidence and the trial court’s reading of limiting instructions in the court’s charge. See Lemmons, 75 S.W.3d at 525. Furthermore, as noted above, the extent of other evidence introduced outweighed any possible prejudicial effect. The extraneous offense was not more heinous or inflammatory than the charged offense, minimizing its prejudicial effect even in the absence of a contemporaneous limiting instruction. See Jones, 944 S.W.2d at 654. For these reasons, we conclude the trial court’s error in overruling counsel’s request for a contemporaneous limiting instruction did not affect a substantial right and therefore must be disregarded. See TEX. R. APP. P. 44.2(b). Point of error three is overruled.

The judgment of the trial court is AFFIRMED.


source: Caselaw Access Project

license: Public Domain

text:
    Ex Parte Malcolm Isles MARTIN.
    No. 09-04-439 CR.
    Court of Appeals of Texas, Beaumont.
    Submitted March 3, 2005.
    Decided March 9, 2005.

      Raquel Galle, Beaumont, for appellant.
    John D. Kimbrough, County Atty., Kris-pen Walker, Asst. County Atty., Orange, for state.
    Before McKEITHEN, C.J., KREGER, and HORTON, JJ.
   OPINION

CHARLES KREGER, Justice.

Appellant, Malcolm Isles Martin, is charged with bail jumping. He filed a pretrial writ of habeas corpus, claiming prosecution is barred by the statute of limitations. Martin asks this court to reverse the trial court’s order denying habe-as corpus relief. We agree that Martin is entitled to a writ of habeas corpus.

Martin was charged by indictment on July 7, 2004, with the offense of bail jumping. The offense was alleged to have occurred on May 22, 2001. See Tex. Pen. Code Ann. § 38.10(f) (Vernon 2003). Martin was initially indicted for aggravated robbery on September 30, 1998 and the case was set for trial on May 21, 2001; Martin did not appear. The indictment on bail jumping is clearly outside the three-year statute of limitations for that offense. See Tex.Code Crim. Proc. Ann. art. 12.01(6) (Vernon Supp.2005).

A pretrial writ of habeas corpus is the proper procedural vehicle to raise the contention that the prosecution is barred by the statute of limitations. See Ex parte Tamez, 38 S.W.3d 159, 160 (Tex.Crim.App.2001). In reviewing the charging instrument we look only to the face of the pleading. Id. at 160-61. The State must allege facts showing the statute of limitations has been tolled. Ex parte Dickerson, 549 S.W.2d 202, 203 (Tex.Crim.App.1977). If the pleading, on its face, shows the offense charged is barred by limitations it is appropriate to grant habeas corpus relief. Tamez, 38 S.W.3d at 160.

The State argues the statute of limitations was tolled during the time Martin was absent from the state. In claiming the statute was tolled, the State relies solely upon the first indictment for aggravated robbery. The State asserts that because Martin was accused of aggravated robbery, he was “an accused” within the meaning of article 12.05(a) and the time he was absent from the state is not computed in the period of limitation. The State is asking this court to interpret “the accused” to mean that if the person was accused of any offense the statute of limitations was tolled — -for any and every other offense. The State cites no authority in support of its position except to argue that the cases cited by Martin, Ex parte Matthews, 933 S.W.2d 134, 138 (Tex.Crim.App.1996), and Ex parte Zain, 940 S.W.2d 253 (Tex.App.-San Antonio 1997, no pet.), do not require “the defendant to be accused of the specific offense in the complained-of indictment.”

Although that was not the issue before either court, we believe the Court of Criminal Appeals in Matthews clearly never contemplated otherwise. The court noted:

Statutes of limitation are acts of grace in that the sovereign surrenders its right to prosecute (or its right to prosecute at its discretion); thus they are considered to be equivalent to acts of amnesty. Vasquez v. State, 557 S.W.2d 779, at 781 (Tex.Cr.App.1977). Statutes of limitation are to be construed liberally in favor of the accused; the burden is on the State to show the offense was committed within the period of limitation. Vasquez v. State, supra, at 783; White v. The State, 4 Tex.App. 488 (1878).

Ex parte Matthews, 933 S.W.2d 134, 136 (Tex.Crim.App.1996), overruled on other grounds by Proctor v. State, 967 S.W.2d 840 (Tex.Crim.App.1998). “There is no authority in law to prosecute a citizen after the period of limitation has intervened. Vasquez v. State, supra, at 783, n. 6; Ex Parte Hoard, 63 Tex.Crim. 519, 140 S.W. 449, at 451 (1911).” Id. at 137, 933 S.W.2d 134.

In Matthews, 933 S.W.2d at 138, the Court of Criminal Appeals determined “a person is ‘accused’ from the time any ‘criminal action’ is commenced against him.” As the court had previously written, “[i]t is clear from our statutory scheme for limitation of criminal prosecutions that the State must present indictments or file in-formations and complaints within certain specified time periods ‘and not afterward.’ Vasquez v. State, 557 S.W.2d 779, 783 (Tex.Crim.App.1977) (emphasis added).

The Matthews court found that adopting the State’s interpretation of “accused” to mean the person now accused “... ignores both the language of Article 12.05(a) as well as its predecessors and caselaw construing and applying them, and would defeat the beneficent intent and studied purpose of statutes of limitation — essentially insisting that prosecutorial authorities exercise all due diligence obtaining and presenting a formal accusation of an offense against a person — ordinarily one who is already a criminally ‘accused.’ ” Ex parte Matthews, 933 S.W.2d at 137. The court further noted that “[t]he prosecution was free to toll running of the statute of limitation by simply fihng and pursuing pre-indictment whatever accusatory pleading or paper it preferred for that purpose. Having failed to do so, the prosecution allowed the applicable statute of limitation to run unabated. Appellant is entitled to the amnesty granted by the Legislature to all citizens similarly situated.” Id. at 138. The court concluded, “[b]eeause it comports with legislative intent and purpose consistently manifested and judicially implemented since at least 1857, we hold that Article 12.05(a) operates to toll the statutory limitations period only when the citizen has been effectively accused of an offense.” Id. (emphasis added).

The State’s reliance upon “an offense” is misguided. Matthews also states “the intent and purpose of statutes of limitation is to require that an accused be prosecuted on a charging instrument filed within the period prescribed for the offense alleged.” Id. at 136-37 (emphasis added). The purpose of the statutes of limitation would be wholly obviated by the State’s interpretation because it would allow any accusation to toll the statute of limitations for any offense.

The more recent opinion by the Court of Criminal Appeals in Hernandez v. State, 127 S.W.3d 768 (Tex.Crim.App.2004), is instructive on this point. In Hernandez the issue before the court was whether article 12.05(b) of the Texas Code of Criminal Procedure, supra, permits a previous indictment for a violation of one law to toll the statute of limitations for violation of a different law. Id. at 768-69. The court held a prior indictment on one offense does not toll the limitations period on another offense, unless it charges the same conduct, act, or transaction. Id. at 774. The court noted that “[i]f we were to read ‘an indictment’ to mean any indictment for any unrelated offense, then a person could be continually indicted for any offense that the State felt inclined to charge once an initial indictment was filed. This application would defeat the purpose of the statute of limitations, which requires the State to exercise due diligence in obtaining and presenting a formal accusation of an offense against a person.” Id. at 772. Reading “the accused” to mean “an accused” as the State requests would produce the same undesirable result.

The aggravated robbery alleged to have occurred sometime before September 30, 1998, is obviously not the same conduct as jumping bail; the factual basis is clearly not the same for the two indictments. Id. at 773. Therefore, the indictment for aggravated robbery did not toll the statute of limitations. See Tex.Code Crim. Proc. Ann. art. 12.05(b) (Vernon 1977).

There is no evidence in the record Martin was charged with any conduct or act that would constitute the offense of bail jumping before the limitations period had expired. See also State v. Shastid, 940 S.W.2d 405 (Tex.App.-Fort Worth 1997, no pet.); Ex parte Zain, 940 S.W.2d at 253.

Accordingly, the order denying habeas corpus relief is reversed and the indictment returned in cause number B-040344R is dismissed.

      . Although the record on appeal does not reflect these facts, they are asserted in both appellant’s and the State’s brief.

      . Art. 12.05. Absence from State and time of pendency of indictment, etc., not computed
      (a) The time during which the accused is absent from the state shall not be computed in the period of limitation.
      (b) The time during the pendency of an indictment, information, or complaint shall not be computed in the period of limitation.
      (c) The term "during the pendency,” as used herein, means that period of time beginning with the day the indictment, information, or complaint is filed in a court of competent jurisdiction, and ending with the day such accusation is, by an order of a trial court having jurisdiction thereof, determined to be invalid for any reason.
      Tex.Code Crim. Proc. Ann. art. 12.05 (Vernon 1977).


author: Justice WRIGHT.

text:
    YOKOGAWA CORPORATION OF AMERICA, Appellant, v. SKYE INTERNATIONAL HOLDINGS, INC., Alan Moore d/b/a Red Oak Capital, Alan Moore, Individually, and Jerry Trojan, Appellees.
    No. 05-04-00134-CV.
    Court of Appeals of Texas, Dallas.
    March 10, 2005.

      P. Michael Jung, James K. Peden, III, Strasburger & Price, L.L.P., James H. Moody, III, Quilling, Selander, Cummiskey & Lownds, P.C., Dallas, for appellant.
    Thomas M. Melsheimer, Fish & Richardson, L.L.P., Steven H. Stodghill, Lynn, Stodghill, Melsheimer & Tillotson, Geoffrey S. Harper, Kelly Dean Hine, Fish & Richardson, P.C., Dallas, for appellees.
    Before Justices WRIGHT, MARTIN RICHTER, and MAZZANT.
   OPINION

Opinion by

Justice WRIGHT.

Yokogawa Corporation of America appeals a summary judgment rendered in favor of Skye International Holdings, Inc., Alan Moore, individually and d/b/a Red Oak Capital, and Jerry Trojan. In two points of error, Yokogawa contends the trial court erred in granting appellees’ traditional and no-evidence motion for summary judgment. We affirm.

Background

Yokogawa manufactured a private label version of one of its products for Environmental Products Amalgamated Pty. Ltd. d/b/a Skye USA. When Skye USA failed to pay the invoices for the products, Yokoga-wa filed a demand for arbitration in March of 1999.

In the spring of 1999, a broker contacted Moore and Trojan about the possibility of providing financing for Skye International. Prior to this point, Moore and Trojan had no involvement with Skye International or any of its owners, officers, or directors. Moore and Trojan learned that Skye International had financial difficulties. Graeme McDougall, Sky International’s owner, presented Moore and Trojan with a plan to raise up to four million dollars in working capital. McDougall also presented them with a large backorder log for its machines. With a bridge loan from Moore and Trojan, McDougall said that it could purchase the materials necessary to increase its production and fill the backlog orders.

On May 17, 1999, Moore and Trojan signed a security purchase agreement with Skye International. Pursuant to that agreement, Moore loaned $590,000 and Trojan loaned $10,000 to Skye International. As security for the loan, Moore and Trojan received a first lien security interest in Skye International’s personal and real property.

In August of 1999, Yokogawa, Skye USA, and Skye International entered into a settlement agreement. Pursuant to this agreement, Skye International guaranteed payment of the money Skye USA owed to Yokogawa. As a result of the settlement agreement, Yokogawa dismissed the arbitration. Skye USA and Skye International failed to make the scheduled payments under the settlement agreement. After several assurances from Skye International that it would soon be able to make the payments fell through, Yokogawa filed suit against Skye USA and Skye International to enforce the settlement agreement on March 9, 2000.

Skye International defaulted on its notes to Moore and Trojan. At a public sale on July 10, 2000, Moore and Trojan foreclosed on the collateral pursuant to its security interest. They purchased the assets of Skye International for approximately $400,000. They then transferred those assets to a newly formed corporation called Skye Delaware.

Standard of Review

The standard of review in summary judgment is well-established. Tex.R. Civ. P. 166(c); Black v. Victoria Lloyds Ins. Co., 797 S.W.2d 20, 23 (Tex.1990). In reviewing a traditional motion for summary judgment, evidence favorable to the non-movant will be taken as true. Nixon v. Mr. Prop. Mgm’t Co., 690 S.W.2d 546, 548-49 (Tex.1985). To prevail on summary judgment, a defendant as movant must either disprove at least one element of each of the plaintiffs theories of recovery or plead and conclusively establish each essential element of an affirmative defense, thereby rebutting the plaintiffs cause of action. City of Houston v. Clear Creek Basin Autk, 589 S.W.2d 671, 678 (Tex.1979). A matter is conclusively established if ordinary minds could not differ as to the conclusion to be drawn from the evidence. Triton Oil & Gas Corp. v. Marine Contractors & Supply, Inc., 644 S.W.2d 443, 446 (Tex.1982).

A no-evidence motion for summary judgment places the burden on the nonmovant to present summary judgment evidence raising a genuine fact issue. Espalin v. Children’s Med. Ctr. of Dallas, 27 S.W.3d 675, 683 (Tex.App.-Dallas 2000, no pet.). We review a no-evidence motion for summary judgment under the same legal sufficiency standard used to review a directed verdict. Gen. Mills Rests., Inc. v. Tex. Wings, Inc., 12 S.W.3d 827, 832-33 (Tex.App.-Dallas 2000, no pet.). Thus, we must determine whether the nonmovant produced more than a scintilla of probative evidence to raise a fact issue on the material questions presented. Id. at 833.

Fraudulent Transfer

The purpose of the Uniform Fraudulent Transfer Act is to prevent fraudulent transfers of property by a debtor who intends to defraud creditors by placing assets beyond their reach. Telephone Equip. Network, Inc. v. TA/Westchase Place, Ltd., 80 S.W.3d 601, 607 (Tex.App.-Houston [1st Dist.] 2002, no pet.).

Yokogawa alleged in its lawsuit that creation of the first hen security interest, the foreclosure on that lien, and the subsequent transfer of assets to Skye Delaware constituted fraudulent transfers. See Tex. Bus. & Com.Code § 24.005(a) (Vernon 2002). Section 24.005 provides, in pertinent part, as follows:

(a) A transfer made or obligation incurred by a debtor is fraudulent as to a creditor, whether the creditor’s claim rose before or within a reasonable time after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligation:
(1) with actual intent to hinder, delay, or defraud any creditor of the debtor; or
(2) without receiving a reasonably equivalent value in exchange for the transfer or obligation, and the debtor:
(A) was engaged or was about to engage in a business or a transaction for which the remaining assets of the debtor were unreasonably small in relation to the business or transaction; or
(B) intended to incur, or believed or reasonably should have believed that the debtor would incur, debts beyond the debtor’s ability to pay as they became due.

A transfer is not voidable under section 24.005(a)(1) against a person who took in good faith and for reasonably equivalent value. Tex. Bus. & Com.Code Ann. § 24.009(a) (Vernon 2002). Pursuant to section 24.005(a)(2), a transfer is not fraudulent if it was made for reasonably equivalent value.

Appellees moved for summary judgment on the grounds that: (1) creation of the security interest was not fraudulent because they took in good faith and for reasonably equivalent value; and (2) the foreclosure and subsequent transfer of assets to Skye Delaware is not a transfer within the meaning of TUFTA.

We agree that the foreclosure and subsequent transfer of assets to Skye Delaware are not covered by TUFTA. A secured party is entitled to foreclose on its security interest in the event of default. Tex. Bus. & Com.Code Ann. § 9.601(a)(1) (Vernon 2002). Moore and Trojan’s enforcement of its security interest upon Skye International’s default does not constitute a voidable transfer. Nor is the subsequent transfer of the assets from the foreclosure sale actionable under TUFTA. Under TUFTA, “transfer” means disposing of or parting with an asset. Tex. Bus. & Com.Code Ann. § 24.002(12) (Vernon 2002). Property encumbered by a valid lean is not an asset under TUFTA. Tex. Bus. & Com. Code Ann. § 24.002(2)(A) (Vernon 2002). Because the property Moore and Trojan purchased at the foreclosure sale was encumbered by a valid lien, TUFTA is inapplicable.

1. Good Faith

We must determine whether Moore and Trojan took their security interest in good faith and for reasonably equivalent value. The business and commerce code defines “good faith” as “honesty in fact and the observance of reasonable commercial standards of fair dealing.” In the context of fraudulent conveyances, “good faith” means that a transaction was made without a secret agreement. Halves v. Central Tex. Prod. Credit Ass’n, 503 S.W.2d 234, 236 (Tex.1973); Tigrett v. Pointer, 580 S.W.2d 375, 396 (Tex.Civ.App.-Dallas 1978, writ ref'd n.r.e.).

Appellees presented summary judgment evidence establishing that Skye International’s assets were already encumbered by a lien in favor of another creditor, Transcon Capital. The summary judgment evidence included Skye International’s balance sheet dated March 31, 1999. The following is noted on the balance sheet:

Skye is currently insolvent. Skye is unable to pay it’s [sic] bills and debts as they become due. Skye is on C.O.D. terms with almost all of its suppliers. Skye is currently unable to fulfill orders for products because of Skye’s insolvent condition. Sencon Pty. Ltd has sued for non-payment of goods. Yokogawa Corporation is threatening to sue for nonpayment of goods. Skye is currently not a going concern company. Skye is only able to produce a limited amount of product because of Skye’s financial state of affairs. Skye/EPA has engaged an accounts payable workout company to deal with past due vendors. Transcon Capital has given notice of foreclose [sic] unless an immediate loan or injection of capital is obtained by Skye. Skye has engaged a broker dealer network to solicit a private placement with the goal of raising four million dollars.

Moreover, McDougall notified Yokogawa by letter both of Transcon’s security interest and of the likelihood that Transcon would enforce its security interest if it did not obtain a bridge loan. Skye International approached appellees about a bridge loan. Appellees had no prior relationship with Skye International or its officers and directors. Appellees loaned $600,000 to Skye International. In return, appellees received a first lien and Transcon’s lien was subordinated with Transcon’s consent. This loan allowed the company to attempt a private placement offering, that, if successful, would have enabled Skye International to pay its debt to Yokogawa.

Yokogawa countered with summary judgment evidence asserting it raised a fact issue on the good faith affirmative defense. Specifically, Yokogawa cites six facts that it claims create a fact question on the issue of good faith. (1) Moore and Trojan’s lien was for all of Skye International’s property. Moore and Trojan’s first lien was senior to all other security interests in Skye International, except that Transcon retained a first lien on accounts receivable prior to May 17, 1999.(2) Following the foreclosure of its security interest, Moore and Trojan formed a new entity and transferred the assets to that entity. We fail to see how foreclosing on its security interest after the debt became due reflects a lack of good faith in providing the bridge loan. (3) Prior to entering into the securities purchase agreement, Moore and Trojan were aware of Skye International’s financial difficulties. The purpose of Moore and Trojan’s loan was to help Skye International recover from its financial problems. Yokogawa was likewise aware of the problems and was aware that previous secured creditor, Transcon, was threatening to foreclose its lien if Skye International failed to obtain a bridge loan. (4) and (5) In March 2000, Moore knew that Yokogawa had threatened suit and began negotiating with Yokogawa “on behalf of Skye International.” The letters Moore sent to Yokogawa were on Red Oak Capital letterhead. Moore stated that he did not represent Skye International. It was basically a letter from one unpaid creditor to another. Moore had not received a single payment on the loan it had made to Skye International more than ten months earlier. When these letters were written, Skye International was in default under the securities purchase agreement. Moore and Trojan could have chosen to foreclose on their lien at that time. (6) Finally, Yokogawa relies on the fact that Moore and Trojan, after the foreclosure, have essentially continued Skye International’s business. Again, we fail to see how this bears upon their good faith in entering into the securities purchase agreement. They provided bridge financing to a company struggling financially, and that loan was secured with a valid first lien.

We conclude appellees established that they entered into the securities purchase agreement in good faith and that Yokoga-wa failed to raise a fact question on the issue of good faith.

2. Reasonably Equivalent Value

Having determined that Moore and Trojan entered the transaction in good faith, we must now address whether they took the security interest for reasonably equivalent value. The supreme court has held that, as a matter of law, the value of the interest in an asset transferred for security is reasonably equivalent to the amount of the debt that it secures. First Nat’l Bank of Seminole v. Hooper, 104 S.W.3d 83, 84 (Tex.2003). In Hooper, the bank loaned money to the debtor for the purchase and operation of a pipeline system. To secure the loan, the bank received a security interest in certain collateral. The security interest, however, did not include the pipeline easements. Two weeks after a creditor obtained a $950,000 judgment against the debtor, the bank had the debtor sign a deed of trust covering the pipeline easements so that the entire pipeline system now secured the debt. The bank subsequently foreclosed on the collateral. Id. at 84. The creditor sued the bank claiming the additional security pledged after the creditor obtained its judgment against the debtor constituted a fraudulent transfer. Id. The jury found that the bank did not provide reasonably equivalent value for the deed of trust because the value of the pipeline system far exceeded the amount of the debt. The trial court rendered judgment in Hooper’s favor and the court of appeals affirmed. Id. at 86. The supreme court reversed. It held the value of the collateral transferred can never be more than the amount of the debt. Hooper, 104 S.W.3d at 86. The value of the collateral is irrelevant because the excess over the debt is not lost to the debtor or other creditors. Id. (citing Anand v. Nat’l Rep. Bank, 210 B.R. 456, 459 (Bankr.N.D.Ill.1997)). If this were not the case, “creditors would be reluctant to negotiate loan work-outs with financially troubled debtors because taking collateral in excess of their loan would expose them to substantial risk over and above the amount of the debt.” Id.

In the securities and purchase agreement, Skye International, Moore, and Trojan agreed that $600,000 represented the fair market value of the loan. The value of the security interest granted to Moore and Trojan can be no more than $600,000, the amount of the loan. See Hooper, 104 S.W.3d at 86. In total, Moore and Trojan loaned $600,000 to Skye International. Thus, Moore and Trojan gave reasonably equivalent value as a matter of law.

Civil Conspiracy

In their motion for summary judgment, appellees alleged there was no evidence to support the elements of Yoko-gawa’s civil conspiracy claim. Initially, Yokogawa contends the trial court erred in granting the no-evidence motion for summary judgment because the discovery period had not expired. When a party asserts that it has not had an adequate time for discovery before a summary judgment hearing, it must file either an affidavit explaining the need for further discovery or a verified motion for continuance. Tenneco, Inc. v. Enter. Prod. Co., 925 S.W.2d 640, 647 (Tex.1996). Yokogawa did not file a motion for continuance. Yokogawa attached its attorney’s affidavit to its response to the motion for summary judgment. The affidavit sets forth the discovery deadline but fails to explain the need for further discovery. Accordingly, we hold that Yokogawa has waived its complaint that the no-evidence motion for summary judgment was premature.

We turn now to the propriety of granting summary judgment on the civil conspiracy claim. In Tilton v. Marshall, 925 S.W.2d 672, 681 (Tex.1996), the Texas Supreme Court held that civil conspiracy is a derivative tort and a defendant’s liability for conspiracy depends on participation in some underlying tort for which the plaintiff seeks to hold at least one of the named defendants liable. Because we have concluded that the trial court properly granted summary judgment in Skye International’s favor on the fraudulent transfer claim, we conclude that summary judgment on the civil conspiracy claim was also proper. We overrule Yokogawa’s second point of error.

We affirm the trial court’s judgment.


author: BRIAN QUINN, Justice.

text:
    Robert PICKENS, Appellant, v. The STATE of Texas, Appellee.
    No. 07-04-0309-CR.
    Court of Appeals of Texas, Amarillo.
    March 10, 2005.

      David Crook, Crook & Jordan, Lubbock, for appellant.
    William C. Sowder, Dist. Atty., Lubbock, for appellee.
    Before QUINN, REAVIS, and CAMPBELL, JJ.
   BRIAN QUINN, Justice.

Robert Pickens (appellant) appeals his conviction for evading detention through four issues. The first two concern whether the trial court erred in denying his motion to suppress evidence while the last two involve the legal and factual sufficiency of the evidence underlying the jury’s verdict. We affirm the judgment.

Background

While returning from a call and at around 9:00 a.m., Officer Calvillo observed a pickup truck parked in an alley behind a house. It was raining, misty, and cloudy at the time, and no one was seen around the vehicle. The officer nonetheless continued on. However, as he did, he noticed that the house behind which the truck was parked appeared vacant and had a “for sale” sign in front of it. So too did he notice movement in the vehicle after he turned down an intersecting street to gain a different vantage point. It appeared to the officer that someone was bent over inside the cab as if to retrieve something.

Recalling that several burglaries had recently occurred in the area, that it was a “common occurrence” for vacant homes to be burglarized, and that appliances and air conditioning units were often the objects taken, Calvillo decided to enter the alley behind the truck. As the officer approached, the truck’s “brake lights come [sic] on” as did its “turn lights,” and the driver began to pull away. When the vehicle and its occupant (who was later identified as appellant) came to the end of the alley and turned on to the adjoining street, Calvillo engaged his emergency lights. Appellant looked back at Calvillo and pointed in the direction of another street, but he did not stop. Instead, appellant sped up. The officer then turned on his sirens. Appellant continued on and began to turn down streets in the residential area. So too did he run a stop sign and drive down a turning lane, both of which were traffic violations according to the officer. The group eventually stopped after appellant turned onto a dead-end street. At that point, appellant was arrested.

A search of the vehicle revealed a syringe cap inside the truck. Furthermore, appellant had thrown a plastic baggy from the track after encountering Calvillo and as the pair drove through the area. When the baggy was retrieved, it was discovered to contain syringes and a burned cotton swab. Appellant also had a fresh needle mark on his arm.

Issues 1 and 2 — Motion to Suppress

In his first two issues, appellant contends that the trial court erred in failing to grant his motion to suppress. Suppression was required because the officer had no basis upon which to initially detain appellant as he drove from the alley, so appellant argues. We overrule the point.

The Court of Criminal Appeals recently held that, in a case wherein the accused is charged with evading arrest or detention, it is improper to request the trial court to rule upon a pretrial motion to suppress evidence when the movant questions the validity of the detention. Woods v. State, 153 S.W.3d 413, 415-16 (Tex.Crim.App.2005). This is so because, under that circumstance, the trial court is being asked to determine whether there is proof of an element of the offense, and that is not the purpose of a pretrial hearing. Id. Given that the trial court was prohibited from acting upon appellant’s pretrial motion to suppress, we cannot say that it erred in refusing to grant the motion.

Issues 3 and 4 — Sufficiency of the Evidence

In his third and fourth issues, appellant questions the legal and factual sufficiency of the evidence to sustain his conviction. Purportedly, the evidence was insufficient because Calvillo lacked reasonable suspicion to try and stop appellant as the latter left the alley. We overrule the points.

The standards by which we review legal and factual sufficiency challenges are well established. We refer the parties to Jackson v. Virginia, 443 U.S. 307, 99 S.Ct. 2781, 61 L.Ed.2d 560 (1979), Sims v. State, 99 S.W.3d 600 (Tex.Crim.App.2003), Zuliani v. State, 97 S.W.3d 589 (Tex.Crim.App.2003), and King v. State, 29 S.W.3d 556 (Tex.Crim.App.2000) for their explanation.

No one disputes that the attempt at detention must be lawful before one can be convicted of evading detention. Moreover, authority holds that even if the initial attempt at detention is unlawful, the suspect may be stopped or arrested for criminal acts which he commits while attempting to avoid the officer. Blount v. State, 965 S.W.2d 53, 54-55 (Tex.App.Houston [1st Dist.] 1998, pet. ref'd). In other words, the fact that an officer may not have basis to stop a suspect does not insulate the suspect from arrest for other crimes committed while attempting to avoid the initial detention. So, assuming arguendo that Officer Calvillo lacked both reasonable suspicion and probable cause to detain appellant in the alley, such arose once appellant violated the traffic laws while attempting to evade Calvillo. And, since evidence appears of record indicating that appellant continued in his effort to evade the officer after violating those laws, the jury had before it sufficient evidence to rationally conclude, beyond reasonable doubt, that the eventual stop was indeed lawful. See id. at 55 (holding that a suspect is not seized until the stop is effectuated). Furthermore, the evidence was neither weak nor overwhelmed by any contradictory evidence. Consequently, the verdict enjoyed the support of both legally and factually sufficient evidentiary support.

The judgment of the trial court is affirmed.


author: JOHN S. ANDERSON, Justice.

text:
    In re PRUDENTIAL SECURITIES, INCORPORATED, and Lisa Metzinger Lamonte, Relators.
    No. 14-04-01196-CV.
    Court of Appeals of Texas, Houston (14th Dist.).
    March 30, 2005.

      Retta A. Miller, Justin R. Goodman, Houston, for relator.
    David Kent Bissinger, Michael M. Wilson, Houston, for respondent.
    Panel consists of Justices ANDERSON, HUDSON, and FROST.
   OPINION

JOHN S. ANDERSON, Justice.

Prudential Securities Incorporated and Lisa Metzinger Lamonte seek mandamus relief from a trial court order denying arbitration of fraud, breach of fiduciary duty, and negligence claims asserted against them by the real party in interest, Lynda Johnson. Because we conclude the claims are factually intertwined with other claims that fall within the scope of a valid arbitration agreement under which Lynda Johnson seeks to recover as assignee, we conditionally grant the relief requested.

BACKGROUND

Ned and Lynda Johnson were married from 1994 to 2002. During the marriage, Ned signed agreements with Prudential Securities Incorporated for the management of his investments. Those agreements contained the following arbitration clause:

Arbitration is final and binding on the parties.
The parties are waiving their right to seek remedies in court, including the right to jury trial.
Pre-arbitration discovery is generally more limited than and different from court proceedings.
The arbitrators’ award is not required to include factual findings or legal reasoning and any party’s right to appeal or to modification of rulings by the arbitrators is strictly limited.
The panel of arbitrators will typically include a minority of arbitrators who were or are affiliated with the securities industry.
The undersigned agrees, and by carrying an account for the undersigned you agree, all controversies which may arise between us concerning any transaction or the construction, performance or breach of this or any other agreement between us, whether entered into prior, on or subsequent to the date hereof, shall be determined by arbitration.

During the divorce proceeding, Lynda learned Ned was an aggressive commodities trader and lost over $2,000,000 in commodities trading over the course of their marriage. Following the divorce, Lynda sued Prudential Securities and Lisa Met-zinger Lamonte, Ned’s advisor, alleging Prudential and Lamonte participated with Ned in a fraud on the community property. Lynda alleged causes of action for fraud, breach of fiduciary duty, negligence, and gross negligence.

Because Ned’s contract with Prudential contained a broad arbitration clause, rela-tors filed a motion to compel arbitration in the trial court. The trial court denied the motion to compel and relators filed a petition for writ of mandamus in this court alleging the trial judge abused his discretion in denying the motion to compel. Lynda responded that her claims were not subject to arbitration because she had not signed the agreement between Ned and relators and her claims did not fall within the scope of the arbitration agreement. This court denied relators’ petition for writ of mandamus. In re Prudential, 2003 WL 22252121, No. 14-03-00758-CV (Tex.App.Houston [14th Dist.] October 2, 2003, orig. proceeding).

After this court’s ruling on relators’ petition for writ of mandamus, Lynda amended her petition adding claims that were Ned’s, which were assigned to her in the divorce. Lynda concedes those claims are subject to arbitration under the agreement with Prudential. Relators filed a motion to compel arbitration in the trial court contending the original claims are factually intertwined with the arbitrable claims; therefore, all Lynda’s claims must be ordered to arbitration and the trial abated until arbitration is completed. The trial court denied relators’ motion to compel and relators filed this petition for writ of mandamus.

Standard of Review

To enforce an arbitration agreement, a party must establish (1) the existence of an agreement to arbitrate, and (2) the claims asserted fall within the scope of the agreement. Valero Energy Corp. v. Teco Pipeline Co., 2 S.W.3d 576, 581 (Tex.App.-Houston [14th Dist.] 1999, no pet.). The parties agree that the Federal Arbitration Act (“FAA”) applies to this case and that a valid arbitration agreement exists between Ned and Prudential and that any claims arising out of that agreement are subject to arbitration. Relators assert that Lynda’s original claims now fall within the scope of the arbitration agreement because they are factually intertwined with the arbitrable claims. We review de novo the trial court’s decision that the claims in the underlying law suit do not fall within the scope of the arbitration agreement. Nationwide of Bryan, Inc. v. Dyer, 969 S.W.2d 518, 520 (Tex.App.-Austin 1998, no pet.).

ORIGINAL Claims

In her original petition, Lynda asserted Ned engaged in reckless investment transactions and relators are liable to her for damages allegedly caused by their failure to supervise Ned in his transactions. The core of Lynda’s complaint was her allegation that relators committed fraud on her community property. Specifically, Lynda asserts (1) relators sold securities by means of untrue statements of material facts and aided and abetted Ned in purchases and sales of securities; (2) relators breached their fiduciary duty owed to her because they failed to exercise good faith and diligence, which they assumed by accepting custody of Lynda’s community property; and (3) relators failed to exercise reasonable care in managing her community property.

The ARbitrable Claims

In her second amended petition, Lynda added claims that originally belonged to Ned, but were assigned to her in the divorce. Lynda admits these claims arise out of the contract and are within the scope of the arbitration clause. These claims include: (1) relators bought and sold securities to and for Ned and his community estate by means of untrue statements of material facts, and/or by concealing material facts; (2) relators breached their fiduciary duties owed to Ned and Lynda by failing to study investments sufficiently before recommending them to Ned; (3) relators failed to exercise reasonable care in advising Ned of the true trading costs involved in activities in the futures account; (4) relators converted the community property by using or selling the property to pay for thousands of unauthorized purchases of commodities futures; (5) relators breached their contract with Ned by failing to comply with the laws and rules applicable to it as a registered broker-dealer and member of the New York Stock Exchange; and (6) rela-tors unjustly retained Lynda’s money and property through actual or constructive fraud.

Scope of Arbitration Clause

When a party invokes a right to arbitration under the FAA, federal law determines whether the dispute is subject to arbitration. Prudential Securities, Inc. v. Marshall, 909 S.W.2d 896, 899 (Tex.1995). Under the FAA, any doubts as to whether Lynda’s claims fall within the scope of the agreement must be resolved in favor of arbitration. Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25, 103 S.Ct. 927, 941-42, 74 L.Ed.2d 765 (1983). The policy in favor of enforcing arbitration agreements is so compelling that a court should not deny arbitration “unless it can be said with positive assurance that an arbitration clause is not susceptible of an interpretation which would cover the dispute at issue.” Neal v. Hardee’s Food Sys., Inc., 918 F.2d 34, 37 (5th Cir.1990). Ordinarily, a non-signatory can only be bound by the terms of an arbitration provision if the non-signatory is asserting claims requiring reliance on the terms of the written agreement containing the arbitration provision. Valero Energy Corp. v. Teco Pipeline Co., 2 S.W.3d at 581. Here, by asserting claims on Ned’s behalf, Lynda admits she has asserted claims requiring reliance on the terms of the written agreement.

In determining whether the original claims fall within the scope of the arbitration agreement, we focus on the factual allegations of the complaint, rather than the legal causes of action asserted. In re FirstMerit Bank, 52 S.W.3d 749, 754 (Tex.2001). We consider whether the facts alleged are intertwined with the contract containing the arbitration clause. Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 271 (Tex.1992). To be within the scope of an arbitration provision, the allegations need only be factually intertwined with arbitra-ble claims or otherwise touch upon the subject matter of the agreement containing the arbitration provision. In re BP America Prod. Co., 97 S.W.3d 366, 370 (Tex.App.-Houston [14th Dist.] 2003, orig. proceeding). Furthermore, Texas law favors the joint resolution of multiple claims to prevent multiple determinations of the same matter. Anglin, 842 S.W.2d at 271.

Lynda argues that because this court denied mandamus when only the original claims were asserted, this court’s opinion in the prior mandamus constitutes the law of the case. In the first mandamus proceeding filed by Prudential, this court’s opinion states only that we denied relator’s petition for writ of mandamus. In re Prudential, 2003 WL 22252121 (Tex.App.-Houston [14th Dist.] October 2, 2003, orig. proceeding). According to Lynda, our opinion constitutes law of the case that subsequent causes of action will not be subject to arbitration. The “law of the case” doctrine mandates that the ruling of an appellate court on a question of law raised on appeal will be regarded as the law of the case in all subsequent proceedings unless clearly erroneous. Briscoe v. Goodmark Corp., 102 S.W.3d 714, 716 (Tex.2003). It applies only if the issues of law and fact are substantially the same in the second proceeding as the first. See Hudson v. Wakefield, 711 S.W.2d 628, 630 (Tex.1986). In this case, this court denied mandamus without specifying the grounds for denial. Further and more importantly, Lynda amended her petition after our ruling adding new claims; therefore, the issues of law and fact are not substantially the same. The law of the case doctrine does not apply to this mandamus proceeding.

Lynda further argues that the court’s holding in Southwest Texas Pathology Assocs., L.L.P. v. Roosth, 27 S.W.3d 204 (Tex.App.-San Antonio 2000, pet. dism’d), supports her position that she cannot be bound by the arbitration agreement. In Roosth, the wife alleged her husband’s partners knowingly participated in a breach of fiduciary duty in entering into partnership amendments that permitted her husband to be terminated without cause. Id. at 208. The wife added the partnership as a third party in her divorce action against the husband. The partnership sought enforcement of its arbitration clause in the agreement signed by the husband. The court found that because the wife did not seek to enforce the terms of the partnership amendments, she was not bound by the arbitration clause. Id.

Here, however, by alleging claims as Ned’s assignee, Lynda seeks to enforce the contract and is subject to the arbitration clause. Although Lynda’s original claims are grounded in legal theories distinct from the claims she brings as assign-ee under the contract Ned signed, they are factually intertwined and subject to the arbitration provision of the contract. See Anglin, 842 S.W.2d at 271. Lynda’s original claims, therefore, are arbitrable pursuant to the agreement and should be arbitrated under the FAA.

Conclusion

Mandamus will issue only to correct a clear abuse of discretion when the abuse cannot be remedied by appeal. Walker v. Packer, 827 S.W.2d 833, 840 (Tex.1992). In this case, the trial court abused its discretion because it failed to compel arbitration for all of Lynda’s claims. A party who is erroneously denied the right to arbitration has no adequate remedy at law because the fundamental purpose of arbitration — to provide a rapid, less expensive alternative to traditional litigation — would be defeated. See Anglin, 842 S.W.2d at 271.

The writ of mandamus is conditionally granted. We are confident the trial court will order Lynda’s claims against relators to arbitration. If the trial court fails to do so, the writ will issue.


author: COOPER, Justice. Justice KELLER.

text:
    Richard MEADE; and Earnestine Meade, Appellants, v. Michael GINN; and Jennifer Ginn, Appellees.
    No. 2002-SC-0518-DG.
    Supreme Court of Kentucky.
    Nov. 18, 2004.
    Rehearing Denied April 21, 2005.

      Kimberly Leet Razor, Flemingsburg, KY, Counsel for Appellants.
    Darrell K. Ruark, Flemingsburg, KY, Counsel for Appellees.
   COOPER, Justice.

Appellants, Richard and Earnestine Meade, own a 131.045 acre tract of land in the Hilltop community of Fleming County, Kentucky. The northern boundary of this tract fronts on Kentucky Highway 1123. A substantial portion of its western boundary borders the eastern edge of a fifty-foot-wide roadway located on a 78.181 acre tract of land owned by Appellees, Michael and Jennifer Ginn. The roadway connects Highway 1123 to an old thirty-foot-wide roadway that crosses another 18 acre tract owned by the Ginns and leads to the southern portion of the Meades’ property that borders on or near the North Fork of the Licking River. The Meades claim that the terrain of their property prevents easy access between its northern and southern portions and, consequently, they used both roadways for many years to access the southern portion of their property for fanning purposes. In 1998, the Ginns closed the fifty-foot roadway by erecting a gate at its terminus with Highway 1123. The Meades filed this action in the Fleming Circuit Court claiming easements over both roadways and demanding compensatory damages for their loss of access to the southern portion of their property. The Ginns admit the Meades own an easement over the thirty-foot roadway that traverses the 18 acre tract but contest the Meades’ right to use any portion of the fifty-foot roadway to reach that easement. The Fleming Circuit Court held that the Meades never acquired an easement over the fifty-foot roadway because no such easement was mentioned in their 1983 deed. The Court of Appeals disagreed, but held that when the Ginns became owners of both the 18 acre tract and the 78.181 acre tract, the dominant and servient tenements merged, thereby extinguishing the easement and the Meades’ right to use it. For the reasons explained herein, we conclude that the right to use the fifty-foot roadway has been an easement appurtenant to the Meades’ property since September 1, 1978, and, in that respect, the Meades’ property is the dominant tenement and the Ginn’s 78.181 acre tract is the servient tenement. Since the Ginns have never owned the Meades’ property, the easement appurtenant to that property has never merged with the servient tenement.

I. THE 18 ACRE TRACT AND EASEMENTS.

These three tracts, ie., the Meades’ 131.045 acre tract and the Ginns’ 18 acre and 78.181 acre tracts, were all originally part of an 800 acre farm sold by W.M. Wheeler on December 30, 1975, to Ersel Yerdell Meade and Sherry R. Meade, his ■wife, Richard Gale Meade (Appellant) and Linda Louise Meade, his then wife, Kenneth Dale Meade and Diane Ellen Meade, his wife, Lanny Ray Meade and Jill Ellen Meade, his wife, Oliver G. Berry, single, and Tate A. Meade and Opha Meade, his wife, referred to collectively as the “Meade families.” Each separate family unit owned an undivided l/6th interest in the entire 800 acres.

The first sell-off from the original 800 acres occurred on December 15, 1977, when the Meade families, including Appellant, Richard Meade, deeded the 18-acre tract now owned by the Ginns to Licking Pork, Inc. The remainder of the original 800 acres completely surrounded this almost square-shaped tract, on which Licking Pork subsequently established a hog farm. The 18 acre tract straddled an old thirty-foot-wide roadway that ran from the southern portion of the 800 acre tract, now part of the 131.045 acre tract owned by Richard and Earnestine Meade, to its northern boundary with Highway 1123. Although the December 15, 1977, deed from the Meade families to Licking Pork, Inc., is not found in this record, the parties agree that the deed reserved an easement in favor of the “grantors herein [Meade families], their heirs and assigns, for the purpose of crossing said 18 acre tract from its entrance road.”

Also on December 15, 1977, the Meade families, including Appellant Richard Meade, entered into a written agreement with Licking Pork, Inc., that provided, inter alia:

[Wjhereas, Grantors have this date sold and conveyed to Grantee an eighteen acre portion of Grantors’ farm located on Kentucky Highway No. 1123 in Fleming County, Kentucky; and Whereas, the parties desire to agree as to appurtenant rights of access, utility easements, water easement, house location, fencing, and other related matters, before surveys have been completed;
NOW THEREFORE, in further consideration of the $20,000 paid this date by Grantee unto Grantor, it is hereby agreed as follows:
(2) Entrance Road and Utility Easement. Grantors will upon demand convey by Grantee’s survey description an unencumbered marketable easement by general warranty deed for purposes of free ingress and egress and utility services between Kentucky Highway No. 1123 and said eighteen acre tract this date conveyed, said easement to be fifty feet wide and located as determined by Grantee in a reasonably direct route from highway to Grantee’s said property. Grantee shall construct and maintain a roadway on said easement, and may construct, repair and replace utility services over, under and through said easement, as well as grant easements within said roadway to utilities for servicing Grantee’s said property, provided that Grantors’ abutting property is not thereby affected or encumbered. Gmntors, their heirs and assigns, may use said roadway in common with Grantee and may cross over said easement betiveen their abutting fields, provided that Grantors may not obstruct or otherwise interfere with Grantee’s use of said easement as aforesaid.

(Emphasis added.) The agreement also required the Meade families to convey, on demand, one additional acre for a residential lot, another lot on the Licking River for construction of a water pumping station, and a water line easement from the pumping station to the 18 acre tract. The agreement was filed of record in Deed Book 145, page 274, in the office of the Fleming County Clerk.

On September 1,1978, citing “paragraph 2 of Agreement recorded in Fleming County Deed Book 145, page 274,” and “in consideration of said Agreement,” the Meade families, including Appellant Richard Meade, deeded to Licking Pork, Inc., “[a] certain fifty foot easement connecting Kentucky Highway No. 1128 with Tract A [the 18 acre tract], the centerline of which is described as [described therein by metes and bounds].” The deed also conveyed a one acre residential lot, a lot on the Licking River for a water pumping station, and a water line easement from the pumping station to the 18 acre tract. The deed contained the following recitation:

Reference is hereby made to said Agreement dated 15 December 1977 and recorded in Fleming County Deed Book 145, page 274 for the rights and duties of the parties with respect to the above described property and easements.

(Emphasis added.)

Thus, the documents executed by the Meade families and Licking Pork, Inc., not only created a fifty-foot easement across the remainder of the Meade families’ 800 acre tract in favor of Licking Pork, but also reserved to the Meade families an easement over the thirty-foot roadway across Licking Pork’s 18 acre tract and the right to use the fifty-foot easement “in common with Grantee.” Since owners of a servient tenement automatically retain the right to use their own property so long as their use does not interfere with the use of the dominant tenement, Holbrook v. Hammond, 302 Ky. 10, 192 S.W.2d 746, 748 (1946) (“It is not necessary that the grantor should expressly reserve any right which he may exercise consistently with a fair enjoyment of the grant. Such rights remain with him, because they are not granted.”), the Meade families would have retained the right to use the fifty-foot roadway even without the agreement. The parties, therefore, must have intended to create a transferable reciprocal or cross easement in favor of the Meade families by their additional agreement vesting in the “grantors, their heirs and assigns” the right to use the fifty-foot roadway “in common with Grantee.” Cf. Furlow v. Sturgeon, Ky., 436 S.W.2d 485, 486 (1968) (contracts must be construed from the standpoint of the parties, and the terms employed must be given effect from that standpoint). Reciprocal or cross easements are created by contract between adjacent landowners for the common use of property to enhance the usefulness and value of both properties, usually with respect to ingress and egress. The result is the creation of easements appurtenant to both properties enforceable by subsequent grantors of each original owner. Rosenbloom v. Grossman, 351 S.W.2d 735, 738 (Mo.1961); 25 Am.Jur.2d Easements and Licenses in Real Property § 21 (1996); cf. Romar Dev. Co., Inc. v. Gulf View Mgmt. Corp., 644 So.2d 462, 465 (Ala.1994) (“[T]he usual case presents the ‘reciprocal easement’ situation, where adjacent landowners contract for the common use of some property or area....”). Our predecessor court recognized the concepts of both reciprocal and cross easements.

There can be no dispute of the easement claimed being annexed to the lot conveyed by Graham, Howarth & Graham to Newton, and consequently following it into the hands of appellant, for it was not only in express terms thereby granted, but in the subsequent deed to Atch-inson specially reserved, in place or consideration of which the Newton lot was charged with a reciprocal easement ever since enjoyed.

Hobson v. Cartwright, 93 Ky. 368, 20 S.W. 281, 281 (1892) (agreement establishing set-back lines and building heights).

“[T]he decided weight of authority establishes the position that an agreement under the hands and seals of such parties containing the usual covenants and stipulations will, when duly delivered and acted upon, create cross-easements in the respective owners of adjacent lots with which the covenants in the agreement will run, so as to bind all persons succeeding to the estates to which such easements are pertinent.”

Ferguson v. Worrall, 125 Ky. 618, 101 S.W. 966, 968 (1907) (agreement establishing joint driveway) (quoting Jones on Easements § 668).

To summarize, the effect of the deed and agreement executed on December 15, 1977, and the subsequent deed executed on September 1, 1978, with respect to the easements was (1) to grant Licking Pork, Inc., an easement across the Meade families’ property on which it could construct a fifty-foot roadway to provide access to the 18 acre tract, and (2) to reserve to the Meade families a thirty-foot easement across the 18 acre tract and a reciprocal right to use the fifty-foot roadway as access to the remaining portions of their property.

On June 21, 1984, the master commissioner of Fleming County deeded Licking Pork’s interest in the 18 acre tract to A.J. DeCoster. On October 23, 1998, DeCoster and his wife conveyed the same tract to Appellees, Michael and Jennifer Ginn. Both deeds recite the reservation by the Meade families of the thirty-foot easement “for the purpose of crossing said eighteen-acre tract from its entrance road (as located pursuant to the Agreement between the parties dated 15 December 1977 and recorded in Fleming County Deed Book 145, page 174) to former Grantors’ [Meade families’] retained land on the River side of said eighteen-acre tract.” In addition to the 18 acre tract, both deeds also conveyed the one acre residential tract, the pumping station lot, the water line easement, and the fifty-foot easement connecting the 18 acre tract with Highway 1123. Although the deed from DeCoster to Ginn did not mention the December 15, 1977, agreement, the stated source of title, ie., the commissioner’s deed to DeCoster, stated as its source of title for the fifty-foot easement the deed from the Meade families to Licking Pork, Inc., which, as noted supra, specifically referred to paragraph 2 of the agreement which gave the Meade families and their “heirs and assigns” the right to use the easement “in common with Grantee.”

By three separate deeds, all dated March 26, 1983, the Meade families sold off the remainder of the original 800 acre farm. The first deed conveyed to Ersel and Sherry Meade the 5/6ths interest of the other families in a 128.395 acre tract not involved in this lawsuit. (Actually, it is unclear from the record whether this tract was part of the original 800 acre farm or whether it was a separate farm owned by the Meade families.)

II. THE 131.045 ACRE TRACT.

The second March 26, 1983, deed conveyed to Appellant Richard Meade and his then wife Louise Meade the 5/6ths interest of the other Meade families in 131.045 acres lying east and south of the fifty-foot roadway and the 18 acre (Licking Pork) tract. This deed recited that it was part of the original 800 acre farm purchased from Wheeler. As noted supra, the deed also specifically recited a grant of the thirty-foot easement across the Licking Pork tract but did not specifically mention the fifty-foot roadway across the Meade families’ remaining property. The deed did, however, refer to the December 15, 1977 agreement, viz: “See also Agreement between grantors dated December 15, 1977, and recorded in D.B. 145, Page 274, Fleming County Court Clerk’s Office,” and did contain the usual habendum language, “together with all and singular' the rights, privileges and appurtenances thereunto belonging-” Louise Meade later conveyed her interest in the tract to Richard Meade.

The absence of a specific reference to the fifty-foot roadway in the deed to Richard and Louise Meade was the basis for the Fleming Circuit Court’s conclusion that the right to use the fifty-foot roadway was not an easement appurtenant to the 131.045 acre tract. Neither the circuit court nor the Court of Appeals addressed whether an easement over the roadway fell within the “rights, privileges and appurtenances thereunto belonging” to the 131.045 acre tract.

III. THE 78.181 ACRE TRACT.

By the third March 26, 1983, deed, the Meade families, including Richard Meade, conveyed the remainder of the original 800 acres, including the 78.181 acre tract containing the fifty-foot roadway, to William M. Stewart and Norma S. Stewart, his wife, and Alexander C. Stewart and Pamela S. Stewart, his wife. The deed purported to describe by metes and bounds all of the 800 acres (assuming none of the original 800 acres were conveyed to Ersel and Sherry Meade) with seven enumerated exceptions. The first five exceptions all pertained to the conveyances made to Licking Pork, Inc., pursuant to the deed and agreement of December 15, 1977. Exception No. 1 (“Tract A”) was the 18 acre tract. Exception Nos. 2, 3 and 5 (“Tracts B, C, and E”) were, respectively, the one acre residential lot, the pumping station lot, and the water line easement. Exception No. 4 (“Tract D”) was the fifty-foot easement that is the subject of this action. Exception No. 4 refers specifically to “paragraph 2 of Agreement recorded in Fleming County Deed Book 145, Page 274.” After identifying the first five exceptions, the deed contains the following recitation:

Reference is hereby made to said Agreement dated December 15, 1977, and recorded in Fleming County Deed book 145, Page 274 for the rights and duties of the parties with respect to the above described property and easements ....

That, of course, was the same recitation contained in the September 1, 1978, deed that conveyed the fifty-foot easement to Licking Pork, Inc. Exception No. 6 to the Stewarts’ deed (“Tract F”) was the 131.045 acre tract deeded to Richard and Louise Meade. Exception No. 7 was the thirty-foot easement across the 18 acre (Licking Pork) tract described in Exception No. 1 (“Tract A”). The reasons for excluding this easement from the deed to the Stew-arts may have been because (1) William Stewart was also the president of Licking Pork, Inc., and (2) the easement across the 18 acre tract served only other property conveyed to the Stewarts and the 131.045 acre tract conveyed to Richard and Louise Meade, whose deed specifically included the thirty-foot easement.

On January 29, 1987, the master commissioner deeded all of the property acquired by the Stewarts from the Meade families, including the 78.181 acre tract, to Nick Crain. On July 31, 1995, Nick Crain and his wife deeded the property to Wayne Crain. Both of the Crains’ deeds recited the same exceptions recited in the Stewarts’ deed and both made the same references to the December 15, 1977, agreement. Wayne Crain had the entire property resurveyed and, on April 2, 1997, sold a portion of the property, including the 78.181 acre tract, to Billy and Mona Sapp. Unlike the Crains’ deeds, the Sapps’ deed recited only that the 78.181 acre tract was “subject to a 50-foot Entrance and Utility Easement to provide access to Licking Pork, Inc. (D.B. 145, Pg. 286 [deed from the Meade families to Licking Pork]).” Although no reference was made to the December 15, 1977, agreement, the Sapps’ deed recited that “[t]he above described easement is the same Entrance and Utility Easement Exception #4 Tract ‘D’ recorded in Deed Book 183, Page 182 [deed from Nick Crain and wife to Wayne Crain],” which specifically referred to the agreement. On August 13, 1998, the Sapps deeded their property, including the 78.181 acre tract, to the Appellees, Michael and Jennifer Ginn. When the Ginns later obtained title to the 18 acre tract, they owned both the tract containing the fifty-foot roadway and the tract to which the roadway leads. This was the basis for the Court of Appeals’ conclusion that the merger of the dominant and servient tenements extinguished the easement. See Pulliam v. Wiggins, Ky. 580 S.W.2d 228, 230 (1978).

IV. EASEMENT IN GROSS.

Grantors, their heirs and assigns, may use said roadway in common with Grantee and may cross over said easement between their abutting fields

At worst, this language in the December 15, 1977, agreement vested the Meade families, including Appellant Richard Meade, with an easement in gross over the fifty-foot roadway. This appears to have been the conclusion of the Court of Appeals, which held that the Meade families retained an easement over the fifty-foot roadway even after 5/6ths of the families had sold all their interests in the original 800 acre farm. But if so, the Court of Appeals erroneously concluded that the merger of the 18 acre and 78.181 acre tracts extinguished their easements.

[A]n easement in gross is a mere personal interest in or right to use the land of another. It is attached to and vested in, the person to whom it is granted. In fact, the principal distinction between an easement in gross and an easement appurtenant is that in the first there is not, and in the second there is, a dominant tenement to which it is attached.

25 Am.Jur.2d, Easements and Licenses in Real Property § 11 (1996). See also Inter-County Rural Elec. Co-op. Corp. v. Reeves, 294 Ky. 458, 171 S.W.2d 978, 983 (1943) (an easement appurtenant is owned by the dominant tenement, not the owner of the tenement, whereas an easement in gross is personal to the grantee). Since an easement in gross is not owned by the dominant tenement, a merger of the dominant and servient tenements would not extinguish it.

An easement in gross acquired by prescription cannot be assigned. Thomas v. Brooks, 188 Ky. 253, 221 S.W. 542, 543 (1920). If, e.g., Appellants Richard and Earnestine Meade owned only a prescriptive easement in gross over the fifty-foot roadway, a sale of the property to a subsequent purchaser would not include ownership of the easement. However, if acquired by contract, as here, it may be made assignable by the terms of the instrument creating the right. 25 Am. Jur.2d, Easements and Licenses in Real Property § 102 (1996). The terms of the written agreement of December 15, 1977, created a reciprocal easement that was both inheritable and assignable.

Nevertheless, “[i]t is the general rule that easements in gross are not favored, and that an easement will never be presumed to be a mere personal right when it can fairly be construed to be appurtenant to some other estate.” Martin v. Music, Ky., 254 S.W.2d 701, 703 (1953). See also Buck Creek R. Co. v. Haws, 253 Ky. 203, 69 S.W.2d 333, 335 (1934); Johns v. Davis, Ky., 76 S.W. 187, 189 (1903). Because the easement over the fifty-foot roadway can fairly be construed to be an easement appurtenant to the 131.045 acre tract, we conclude that it is not an easement in gross.

V. EASEMENT APPURTENANT.

The Meade families acquired the right to use both the fifty-foot roadway and the thirty-foot easement across the 18 acre tract at a time when the families owned all of the land on both sides of the fifty-foot roadway and all of the land served by use of the thirty-foot easement.

“The rule is general that, where one conveys a part of his estate, he impliedly grants all those apparent or visible easements upon the part retained which were at the time used by the grantor for the benefit of the part conveyed, and which are reasonably necessary for the use of that part.”

Stone v. Burkhead, 160 Ky. 47, 169 S.W. 489, 490 (1914) (quoting Jones on Easements ). Further:

“It may be considered as settled in the United States that, on the conveyance of one of several parcels of land belonging to the same owner, there is an implied grant or reservation, as the case may be, of all apparent and continuous easements or incidents or property which have been created or used by him during the unity of possession.... ”

Irvine v. McCreary, 108 Ky. 495, 56 S.W. 966, 967 (1900) (quoting Washburn on Easements, at 81).

No one has disputed that the fifty-foot roadway was reasonably necessary for the Meade families’ use of their property located on both sides of the roadway. Thus, when the Meade families conveyed the fifty-foot easement to Licking Pork, Inc., on September 1, 1978, and retained the right to use the roadway “in common with Grantee,” the roadway became a reciprocal easement appurtenant to the Meade families’ property located on both the east and west sides thereof. Remember, Richard and Louise Meade already owned a l/6th interest in the 131.045 acres on the east side of the roadway, including the easements appurtenant thereto, before they were deeded the remaining 5/6ths interest owned by the other Meade families. It is also apparent that the conveyance of the other 5/6ths interest in the 131.045 acre tract preceded the conveyance of the 78.181 acre tract to the Stewarts, since the conveyance of the 131.045 acre tract was identified in the Stewarts’ deed as an exception to the property conveyed to them. But even if the timing of the deeds had been reversed, such would not have affected the status of the fifty-foot roadway as an easement appurtenant to the 131.045 acre tract. That status had existed since September 1, 1978, when the Meade families deeded the fifty-foot easement to Licking Pork, Inc., subject to the terms of the December 15, 1977, agreement. Thus, it was immaterial that the subsequent deed conveying the other Meade families’ 5/6ths interest to Richard and Louise Meade did not specifically recite that ownership of the deeded property included the right to use the adjacent roadway. See Hatfield v. Hatfield, 150 Ky. 788, 151 S.W. 3, 4 (1912) (“The purpose of Wooldridge in making the reservation was to retain for himself a way out when he sold the land lying between himself and the public road. This reservation was made for the benefit of the tract which he still owned and afterward sold to William H. Hatfield. It was an appurtenance to that tract and passed to the grantee of that tract though it is not expressly mentioned in the deed; for, being an appurtenance, it ran with the land.”); Johns v. Davis, 76 S.W. at 189 (“A right of way is appurtenant to the land of the grantee if so in fact, although not declared to be so in deed.”).

Accordingly, the decisions of the Fleming Circuit Court and the Court of Appeals are reversed, and the right to use the fifty-foot roadway lying adjacent to the 181.045 acre tract now owned by Appellants, but within the 78.181 acre tract now owned by Appellees, is held to be an easement appurtenant to the 131.045 acre tract. This action is remanded to the Fleming Circuit Court with directions to conduct further necessary proceedings consistent with this opinion.

GRAVES, JOHNSTONE, STUMBO, and WINTERSHEIMER, JJ., concur.

KELLER, J., dissents by separate opinion, with LAMBERT, C.J. joining that dissenting opinion.

Dissenting opinion by

Justice KELLER.

Because the fifty-foot easement was extinguished when the Ginns acquired the 78.181 acre tract on which the easement was located, I dissent and would affirm the Court of Appeals.

When the Meade families conveyed the 18 acre tract to Licking Pork, they granted Licking Pork a fifty-foot-wide easement across their property to provide access to Highway 1123 from the 18 acre tract, as shown on the following plat:

In granting this easement, the Meade families merely granted Licking Pork the right to pass over land which the Meade families retained ownership of. An easement is not a grant of the land itself, nor is it a setting aside of land for use by others; rather it is simply a grant of an intangible right to use the land, and nothing more.

This easement was only for the benefit of the 18 acre tract (the dominant tenement, with the Meade families’ property being the servient tenement) and, therefore, was an easement appurtenant only to that tract. Under well-settled rules of property law, however, this easement was extinguished when the Ginns became the owners of both the 18 acre tract (dominant tenement) and the 78.181 acre tract containing the roadway (servient tenement):

When one party acquires a fee title to both the servient and dominant estates, the easement merges into the interest of the servient estate and terminates. Thus, any time the party who owns an easement right acquires legal ownership of a servient tenement, the easement associated with that parcel is extinguished. Such unity of possession destroys all existing easements, because a person cannot have an easement on land that he or she owns.

Because a grantor of an easement still has the right of full dominion and use of the land over which the easement is granted, the language in the contract which claims to reserve unto the Meade families the use of the fifty-foot-wide roadway on their property was merely superfluous and did not create an easement appurtenant to the Meade families’ property:

“[T]he general grant of a passway, or right of way, over the land of the grant- or at a particular place, does not confer either the possession or the right of possession of the land, but the mere right of way, or of passing over it.... Notwithstanding such a grant, there remains with the grantor the right of full dominion and use of the land, except so far as a limitation of his right is essential to the fair enjoyment of the right of way which he has granted. It is not necessary that the grantor should expressly reserve any Hght which he may exercise consistently with a fair enjoyment of the grant. Such rights remain with him, because they are not granted. And for the same reason, the exercise of any of them cannot be complained of by the grantee, who can claim no other limitation upon the rights of the grantor, but such as are expressed in the grant, or necessarily implied in the right of reasonable enjoyment.”
... “The creation of a private way does not take from the owner of the land over which it passes any portion of the fee of the soil. Regardless of how acquired, a private way carries with it by implication only such incidents as are necessary to its reasonable enjoyment. The owner of the land has the right to use the way for any purpose whatever, provided he does not interfere with the right of passage resting in the owner of the easement. Hence, the grant of a right of way, which is not exclusive in its terms and which can be reasonably enjoyed without being exclusive, leaves in the grantor and his assigns the right of user in common with the grantee. The owner of the servient tenement may sow crops on the right of way if such action does not interfere with the rights of the owner of the dominant tenement.”

At most, the language reserving the Meade families’ right to use the roadway was simply a restatement of this well-settled rule of property law since they had a right to use the roadway located on their property regardless of whether such right was reserved.

Another well-settled rule is that “a person cannot have an easement on land that he or she owns.” The majority’s approach is untenable in that it not only violates this well-settled rule of property law, but it also creates a novel and unprecedented rule that such an easement is appurtenant to the property located on both sides of the easement even though the property on both sides of it, and on which the easement itself is located, is owned by the same person. This is not the law, never has been, and never should be. The doctrine .of stare decisis is of utmost importance when the issue involves real property, and this Court should not adopt a novel rule of property law, especially when the prior rule has not been shown to be incorrect. Unfortunately, the majority opinion fails to adhere to the doctrine.

The contract language did not create an easement appurtenant to the Meade families’ property for two reasons: one, Licking Pork did not own the land on which the fifty-foot roadway was located, and thus, it could not grant the Meade families an easement across it; and two, the Meade families owned the land on which the fifty-foot roadway was located, and consequently, they could not grant themselves an easement. Even if the purpose of the contract language was to reserve an easement, it failed to do so because any easement the Meade families reserved on their own property instantaneously merged with the title to the property and was extinguished.

Quite simply, the Meade families should not have conveyed the fifty-foot strip of land on which the easement is located or they should have expressly reserved an easement when they conveyed the 78.181 acre tract — that is the only way that they could have reserved an easement on the conveyed tract. Their failure to do so means that the Appellants now have no right to use the roadway and the Ginns may prohibit them from doing so.

In conclusion, the fifty-foot easement was appurtenant only to the 18 acre tract and was extinguished when the Ginns became the owners of both tracts. The contract language reserving the Meade families’ right to use the roadway was simply a restatement of the law since they had a right to use the roadway located on their property as long as they owned it, regardless of whether such right was reserved. The contract language, therefore, did not create an easement appurtenant to the Meade families’ remaining property, and the Meade families failed to reserve an easement when they conveyed the 78.181 acre tract. For these reasons, I dissent and would affirm the Court of Appeals.

LAMBERT, C.J., joins this dissenting opinion.

      . See 25 Am. Jur. 2d Easements and Licenses § 1 (2004) ("An easement is a privilege which one person has a right to enjoy over the land of another for the benefit of the easement holder’s land, but it does not create an interest in the land itself." (footnote omitted; emphasis added)).

      . 25 Am. Jur. 2d Easements and Licenses § 100 (2004) (footnotes omitted); see Cameron v. Barton, Ky., 272 S.W.2d 40, 42 (1954) ("Appellant finally contends that the easement in controversy was extinguished by merger when a former owner of the dominant estate bought an adjoining lot which offered a means of ingress and egress to and from the Highway Department’s property. The answer to this contention is that the doctrine of merger could not apply because the former owner of the dominant estate did not acquire the ser-vient estate." (emphasis added)); Sievers v. Flynn, 305 Ky. 325, 204 S.W.2d 364 (1947) (holding that an easement is not a separate estate when dominant and servient tracts are under the same ownership); City of Franklin v. St. Mary's Roman Catholic Church, 188 Ky. 161, 168, 221 S.W. 503, 506 (1920) ("It is equally as thoroughly established that, when the owner of an easement acquires the fee-simple title to the land in which he had the easement, the easement is thereby extinguished. ...”); Rogers v. Flick, 144 Ky. 844, 139 S.W. 1098, 1099 (1911) (citing 2 Wash-burn on Real Property, 373) (”[A]n easement is not destroyed or extinguished by the union of the dominant and servient estates, unless the fee in both is acquired and united in the same person." (emphasis added)); 25 Am.Jur.2d Easements and Licenses § 1 (2004) ("When one party acquires a present posses-sory fee simple title to both the servient and dominant tenements, the easement merges into the fee of the servient tenement and is terminated.”); Restatement (Third) of Property: Servitudes § 7.5 (2000) ("A servitude is terminated when all the benefits and burdens come into a single ownership.”).

      . Holbrook v. Hammond, 302 Ky. 10, 13-14, 192 S.W.2d 746, 747-748 (1946) (quoting Maxwell v. McAtee, 48 Ky. (9 B. Mon.) 20 (1848); 17 Am.Jur. 998 § 101 (emphasis added)); also Restatement (Third) of Property: Servitudes § 4.9 (2000) ("[T]he holder of the servient estate is entitled to make any use of the servient estate that does not unreasonably interfere with enjoyment of the servitude.”).

      . See Holbrook, 302 Ky. 10, 192 S.W.2d 746 (1946); Restatement (Third) of Property: Ser-vitudes § 4.9 (2000).

      . 25 Am Jur. 2d Easements and Licenses § 100 (2004) (footnote omitted); see also 25 Am. Jur. 2d Easements and Licenses § 1 (2004) ("A person may not have an easement in his or her own land because an easement merges with the title, and while both are under the same ownership the easement does not con- . stitute a separate estate. It follows that no easement exists so long as there is a unity of ownership of the properties involved.” (footnotes omitted)).

      . 25 Am. Jur. 2d Easements and Licenses §§ 1, 100 (2004).

      . 25 Am. Jur. 2d Easements and Licenses § 100 (2004) ("Thus, any time the party who owns an easement right acquires legal ownership of a servient tenement, the easement associated with that parcel is extinguished.”).