Preview
Filed: 9/13/2022 10:41 AM
JOHN D. KINARD - District Clerk
Galveston County, Texas
Envelope No. 68193764
By: Shailja Dixit
9/13/2022 10:56 AM
No. 21-CV-0305
DAVID AND CONNIE EVANS, § IN THE DISTRICT COURT OF
§
Plaintiffs, §
§
v. § GALVESTON COUNTY, TEXAS
§
MB HARBOUR, LTD. AND HARBOUR §
MANAGEMENT, LLC §
§
Defendants. § 10th JUDICIAL DISTRICT
MB HARBOUR, LTD. AND HARBOUR MANAGEMENT, LLC’S TRADITIONAL
MOTION FOR SUMMARY JUDGMENT
TO THE HONORABLE JUDGE OF THIS COURT:
Defendants MB Harbour, LTD. (“MB Harbour”) and Harbour Management, LLC
(“Harbour Management”) (collectively, “Defendants”) file this motion for summary judgment (the
“Motion”) and ask the Court sign a summary judgment against David and Connie Evans’
(“Plaintiffs” or the “Evans”) various requests for declaratory judgment, and show:
SUMMARY
• Plaintiffs seek various declarations by this Court against Defendants to,
among other things, allow Plaintiffs to use MB Harbour’s property for free,
to otherwise limit and restrain MB Harbour’s use of its own property, and
to even have this Court declare that MB Harbour does not own property that
it has paid or invested hundreds of thousands of dollars to purchase and
improve.
• To achieve these ends, Plaintiffs ask the Court to set aside a contractual real
property covenant entered into by Plaintiffs’ immediate predecessors in
interest, of which Plaintiffs readily concede they had actual knowledge; to
set aside more than one hundred and fifty years of Texas jurisprudence that
protects subsequent purchasers without notice of unrecorded real property
instruments; and, to create new law in contravention of Texas’ longstanding
trespass to try title jurisprudence, and simply declare that MB Harbour no
longer owns the property that it paid considerable money for.
1
• While Plaintiffs’ claims fail for many reasons, before even reaching these
many reasons, there are three issues that are decisive in this case, as a matter
of law:
(1) Plaintiffs are bound by a contractual covenant entered into by their
predecessors in interest to Lots 29 and 30 that unequivocally recognized
MB Harbour’s superior title in MB Harbour’s property and expressly
terminated and abandoned any prior rights or easements to the extent any
existed over MB Harbour’s property;
(2) Texas law protects innocent purchasers of real property against
unrecorded instruments of which they had no notice; and,
(3) Plaintiffs have failed to properly plead, and have failed to prove MB
Harbour does not own the land it paid for.
SUMMARY-JUDGMENT EVIDENCE AND REQUEST FOR JUDICIAL NOTICE
1. Pursuant to Texas Rule of Civil Procedure 166a(d), MB Harbour intends to use the
discovery and instruments referred to and cited as summary judgment proof. Additionally, MB
Harbour relies upon all pleadings, documents, discovery products, and motions and responses on
file with the District Clerk in this matter at the time of the hearing for summary judgment, the
evidence contained in or attached to this motion for summary judgment, and the evidence and
exhibits filed with and accompanying any response or supplements to this motion.
Exhibit
Description
No.
Affidavit of Teresa Scotto, Vice President of MB Harbour, with
1.
attached business records.
Affidavit of Robert Ellis, including attached business records and
2. surveys completed as part of his expert report and produced in this
matter.
Affidavit of Marc D. Young, attesting records received from
3. Independence Title and NRG in response to non-party subpoenas and
related requests.
2
MB Harbour Canal Deed, September 15, 2006 deed from NRG to MB
4. Harbour recorded in the Official Galveston County Real Property
Records with document number 2006067603.
MB Harbour Canal Deed, Correction Deed issued to MB Harbour by
NRG on or about February 8, 2008, with the same effective date of the
5.
original deed, September 15, 2006, recorded in the Official Galveston
County Real Property Records with document number 2008007810.
Survey for MB Harbour, LTD. performed by Huitt-Zollars on or about
6.
August 9, 2006. (See, Exhibit 1 for authentication.)
7. Glen Cove Plat recorded in 1928. Volume 6, Page 83, Map Records.
1958 and 1969 Aerial Photographs from EDR Environmental Data
8.
Resources. (See, Exhibit 1 for authentication.)
April 18, 2007 United States Army Corps of Engineers (“USACE”)
9.
Letter to MB Harbour. (See, Exhibit 1 for authentication.)
ONE TO FOUR FAMILY RESIDENTIAL CONTRACT (RESALE)
with DocuSign unique envelope identification number 65DDF5E3-
10. DE3E-44C5-A316-E215A97643E2 (“The Sales Contract”). (See
Exhibit 3 and Business Records Affidavit from Independence Title
appended to end of Exhibit for authentication.)
Kings’ Deed to Evans or Evans’ Deed with an instrument date of
August 12, 2020 and recorded in the Official Galveston County Real
11.
Property Records on August 13, 2020 with document number
2020049449.
Survey from Robert Ellis with survey overlaying 2012 satellite image.
12.
(See, Exhibit 2 for authentication.)
Darr Deed to Kings, recorded in the Official Galveston County Real
13. Property Records on December 26, 2014 with document number
2014072604
Canal Use Agreement recorded in the Official Galveston County Real
14.
Property Records with document number 2017073505.
15. Transcript of David Evans deposition taken July 12, 2022.
3
November 28, 2006 Texas General Land Office (“GLO”)
Memorandum from Bill O’Hara, Director, Surveying Division,
Subject: Status of Glen Cove Lake in Galveston County. This
document was Exhibit 16 to Plaintiffs’ designated expert witness and
16.
witness, Paul Smith. Smith confirmed at his deposition that these
copies “reflect [his] communications with the Texas General Land
Office in October, November of 2006 and December of 2007. See,
Paul Smith Deposition Transcript, 139:13-140:09.
Plaintiffs Answers and Responses to Defendants’ Discovery
17. Requests served January 28, 2022. (Excludes Request for Production
Responses.)
September 8 2017, Letter from Norex Engineering on behalf of MB
18.
Harbour. (See, Exhibit 1 for authentication.)
2017 Canal use fee payment from the Kings to MB Harbour. (See,
19.
Exhibit 1 for authentication.)
Certificate of Insurance for the boat dock submitted to MB Harbour
20.
by the Kings. (See, Exhibit 1 for authentication.)
2018 Canal use fee payment from the Kings to MB Harbour. (See,
21.
Exhibit 1 for authentication.)
2019 Canal use fee payment from the Kings to MB Harbour. (See,
22.
Exhibit 1 for authentication.)
Tim Gamble Boat Dock License issued by Texas Genco in June,
23. 2004. (Documents produced in Plaintiffs’ Paul Smith’s Workfile.
License also referenced in Exhibit 1)
Texas Genco Template License Agreements (Documents produced
24.
in Plaintiffs’ Paul Smith’s Workfile.)
Lease issued for the construction of a boat dock on or around July
25.
30, 1976. (NRG Document, See Exhibit 3 for authentication.)
BACKGROUND & INDISPUTABLE FACTS
A. MB Harbour is the fee simple owner of the property Plaintiffs seek to permanently
impair.
4
2. MB Harbor is the fee simple owner of real property located in Galveston County,
Texas. Exhibit 1, Affidavit of Teresa Scotto. Among its Galveston County property, is a 6.01 acre
tract that MB Harbour purchased from NRG1 in 2006 (the “MB Harbour Canal” or “MB Harbour
Property”).2 Id. The majority of the MB Harbour Canal is (and was at the time of MB Harbour’s
purchase) submerged beneath water, and connects to Clear Lake. Id. This water is what is
commonly called the HL&P Canal, HL&P Genco Canal, the Glen Cove Canal, or the MB Harbour
Canal. Some of the land surrounding the 6.01 acre tract purchased by MB Harbour is also covered
by water.
3. MB Harbour purchased this property to revitalize the existing MB Harbour Canal
through dredging and other earthwork, and to connect it to a larger real estate development project
it initiated, that would create a new, navigable canal, turn an existing ‘ditch,’ into a navigable
canal, and that would, in turn, connect with and flow into the MB Habour Canal. Id.
4. MB Harbor obtained fee simple title of its property, the MB Harbour Canal from
NRG Texas LP through a bona fide purchase of the property for $290,859.40 cash consideration
on or about September 15, 2006. Exhibits 1 and 4, First NRG Deed to MB Harbour. The MB
Harbour Canal was conveyed to MB Harbour from NRG by means of a special warranty deed that
was recorded in the Official Galveston County Real Property Records on October 4, 2006, with
document number 2006067603. Exhibit 4. A correction deed was issued on or about February 8,
2008, by NRG with the same effective date of the original deed, September 15, 2006 (the “MB
1
NRG Texas, LP, a Texas Limited partnership (successor to Texas Genco II, LP).
2
Reference to the MB Harbour Canal Property in this motion refers to the defined 6.01 acres that
was conveyed to MB Harbour by NRG. References to the Glen Cove Canal refer to all areas
covered by water, to include the MB Harbour Canal Property and anything surrounding it that is
also covered by water.
5
Harbour Deed”), and was recorded in the Official Galveston County Real Property Records on
February 12, 2008, with document number 2008007810. Exhibit 5, NRG Deed to MB Habour.
5. The MB Harbour Canal property is generally depicted below in what is described
as Tract 7, and surrounded by the bolded outline (cut away image from Exhibit 6) :
- Exhibit 6, Image from Huitt-Zollars’ Survey.
6. On either side of MB Harbour’s Canal is an area that is commonly called the Glen
Cove Subdivision that was first platted in 1928:
6
- From Exhibit 7, Glen Cove Plat recorded January 7, 1928 in Volume 6, Page 83, Map
Records, Galveston County, Texas.
7. There was no canal originally. As seen in the above plat, the area was upland
marsh, and was designated “Glen Cove Lake (Proposed)” and “Reserved” on the Plat. The fact
that this land did not regularly contain water and was not more than an upland marsh is confirmed
by aerial imagery from 1958:
7
- From Exhibit 8, Aerial Photographs from EDR Environmental Data Resources 1958
photo.
8. The MB Harbour Canal was created in the 1960’s through HL&P’s excavation,
earthwork, and dredging. The Canal was originally created to be used as a discharge canal for
cooling water from HL&P’s Webster power plant. As evident from the above image and the
original plat, prior to its creation, the MB Harbour Canal was not a waterway at all, much less
navigable. It is not a natural water feature—it was manmade.
9. By 1969, the first form of the canal was in place and filled with water, flowing into
Clear Lake (red outline of general canal area, connecting to other canal sections):
- From Exhibit 8, 1969 Aerial Photograph from EDR Environmental Data Resources (Red
outline added by the author of this motion; not to scale.).
10. Local, state, and federal authorities have long recognized the canal as a private
waterway whose submerged surface is privately owned. For example, an April 18, 2007 letter from
the Section Chief of the local compliance section of the United States Corp of Engineers
8
(“USACE”) to MB Harbour stated: “This waterway is considered a manmade discharge canal that
was permitted to HL&P for connecting the canal to navigable waters, Clear Lake.” Exhibit 9,
Letter from USACE.
11. MB Harbour does not seek to prohibit those complying with federal and state law
to ingress and egress over and upon the water over its property. Exhibit 1. MB Harbour has not
prohibited those complying with federal and state law from ingressing and egressing over and upon
the water over its property. Id. In fact, that free ingress and egress is a necessary feature of the
residential development which prompted MB Harbour’s purchase and re-dredging of the canal
property.
12. MB Harbour purchased this property as part of a larger, comprehensive real estate
development project that MB Harbour refers to as the Cypress Bay Project (the “Cypress Bay
Project” or the “Project”). See, Exhibit 1. The Cypress Bay Project involved the purchase and
development of more than 56.487 acres of real property, which includes approximately 10 acres
of canal tracts, in Galveston County, Texas, costing more than $15 million to purchase and develop
the property. Id. The Cypress Bay Project developed this land and lead to the creation of the
Cypress Bay subdivision (a residential subdivision), a self-storage marina facility, a waterfront
shopping center, and other commercial property. Id. The development of Cypress Bay also
allowed approximately 15 other properties in the Marina Del Sol Subdivision to become waterfront
properties. Exhibit 1, Affidavit of Teresa Scotto.
13. The Project required MB Harbour hiring many different professionals and
consultants, including surveyors, lawyers, civil engineers, construction companies, among others.
Id. MB Harbour invested more than $1.5 million for the planning and execution of this project.
Exhibit 1. When MB Harbour started this project, after its purchase in 2006, this 6.01 acres needed
9
to be dredged and was not freely navigable over much of the tract, because it had filled with silt
and other sedimentary build up from drainage and incoming storms. Id. Prior to MB Habour’s
purchase, the area had not been dredged since the 1960’s, MB Harbour has dredged the canal twice
in the last 18 years. Id.
B. Lots 29 and 30 of Block 4 of Glen Cove, now owned by the Plaintiffs.
14. Located south of the MB Harbour Canal, among the residential lots platted in 1928,
are Lots 29 and 30 of Block 4 of Glen Cove (“Lots 29 and 30”).3 This property is also commonly
known as 2122 Cove Park Drive, League City, Texas. The Plaintiffs purchased Lots 29 and 30
from Harold and Claudia King (collectively the “Kings”).
15. On or about July 6, 2020, both the Kings and the Evans executed a sales contract,
ONE TO FOUR FAMILY RESIDENTIAL CONTRACT (RESALE), for the Evans’ purchase of Lots
29 and 30 from the Kings (the “Sales Contract”). See, Exhibit 10, The Sales Contract. The Sales
Contract between the Parties was electronically signed through a commercial program called
DocuSign and was given a unique envelope identification number by the program of 65DDF5E3-
DE3E-44C5-A316-E215A97643E2 (“DocuSign 7643E2”). The only legal description provided in
the Sales Contract was that of Lots 29 and 30. See, Exhibit 10 at 1.
16. On or about August 12, 2020, the Kings conveyed to the Evans Lots 29 and 30 with
a warranty deed. See, Exhibit 11, Kings’ Deed to Evans recorded in the Official Galveston Real
Property Records on August 13, 2020 with document number 2020049449. The only property
described in the deed is: Lots 29 and 30, Block 4, GLEN COVE, according to the map or plat
thereof, recorded in Volume 6, Page 83, Map Records, Galveston County, Texas.
3
The full legal description as recorded in the deed records is “Lots 29 and 30 of Block 4 of Glen
Cove, according to the map or plat thereof, recorded in Volume 6, Page 83, Map Records,
Galveston County, Texas.” See, Exhibit 13, Darr Deed.
10
17. Lots 29 and 30 are not adjacent to, do not abut, and never abutted what was
originally described as Glen Cove Lake (Proposed). The Lots do not share a common boundary
with what was originally described as Glen Cove Lake (Proposed). As depicted in this blown-up
image from the original plat:
- From Exhibit 7 (Close up image taken from plat showing boundary of reserve in
between boundary of Lot 29 to the left of what is shown as Lot 30.
18. And today, Lots 29 and 30 are not adjacent to and do not abut the MB Harbour
Canal. The Lots do not share a common boundary with the MB Harbour Property. Included in the
executed sales contract was a survey, initialed by the Evans that conclusively establishes this fact:
- From Exhibit 10, Sales Contract at 65, Survey initialed by the Evans.
11
19. The above image confirms that Lots 29 and 30 end at the line described as N 60°
15’ 23” E 49.98’. In a more recent survey performed by surveyor Robert Ellis which incorporates
a 2012 satellite image underlay, you can see the cut in the remainder. The red arrow in the image
below points to the barely visible boundary lines of Lots 29 and 30:
Lots 29 and 30
Boundary
- From Exhibit 12, Image from Survey of Ellis Surveying.
20. Also appended to the Sales Contract is a copy of the Canal Use License Agreement
(“Canal Use Agreement”). See, Exhibit 10 at 23-40. This copy of the Canal Use Agreement has
the same electronic identification number on the top of each page of the document confirming that
it was a part of the Sales Agreement. Id. The Canal Use Agreement was also electronically initialed
by both David and Connie Evans. Id. at 40 (Bates labeled 220).
C. The Canal Use Agreement.
21. On or about November 21, 2014, the Kings purchased 2122 Glen Cove from Vance
and Holly Darr (the “Darrs”). See Exhibit 13, Darr Deed to Kings, recorded in the Official
Galveston County Real Property Records on December 26, 2014 with document number
2014072604.
22. The Deed from the Darrs to the Kings provided:
12
Grantor, for the Consideration and subject to the Exceptions to Conveyance
and Warranty, grants, sells, and conveys to Grantee the Property, together
with all and singular the rights and appurtenances thereto in any way
belonging, to have and to hold it to Grantee and Grantee's heirs, successors,
and assigns forever. – Id.
23. On or about October 26, 2017, the Kings, as Licensee, executed the Canal Use
Agreement with MB Harbour, as Licensor, to give the limited use of real property owned by MB
Harbour in the MB Harbour Canal to erect a boat dock (the “Boat Dock”) on its surface. See
Exhibit 14, the Canal Use Agreement. The Canal Use Agreement was recorded in the Official
Galveston County Real Property Records on December 4, 2017 with document number
2017073505. Id.
24. The Canal Use Agreement provides, among other things:
Licensee agrees that Licensor is the owner of the Canal and that
Licensee has no right, title or interest therein whatsoever, except such
as is expressly granted in this Agreement. Licensee acknowledges that
the presence of the Existing Improvements in the Canal in the absence of
this Agreement is a trespass and an encroachment on the property of
Licensor.
- Exhibit 14, Canal Use Agreement, at 2. (Emphasis added).
[I]t is agreed and understood by Licensee that the rights, privileges and
obligations conferred and imposed upon Licensee by this Agreement may
not be sold, conveyed, devised, assigned or sublet by Licensee except to a
subsequent purchaser of [Lots 29 and 30], and by the purchase of [Lots 29
and 30] any such subsequent purchaser fully and without reservation
accepts the rights and obligations imposed by the Agreement and
license granted herein.
- Id. at 8 (emphasis added).
[T]he license granted herein shall become a covenant running with land
and shall attach to [Lots 29 and 30] and in no event whatsoever shall be
separated or divisible in any form or manner from the ownership of
[Lots 29 and 30].
- Id. (emphasis added).
25. Per the terms of Canal Use Agreement, the Kings paid an annual fee of $2,500 to
MB Harbour for their benefits under it. Id. at 4-5. The Canal Use Agreement further provides that
13
MB Harbour has the right to remove the Boat Dock at the expense of the Licensee. See Id. at 5 and
9.
26. In addition, the Canal Use Agreement provided that if any party institutes a legal
action for the enforcement of any right or obligation arising under its terms that the prevailing
party “shall be entitled to recover its costs and reasonable attorneys’ fees.” Exhibit 14 at 9.
27. On its own terms, the Canal Use Agreement was still in effect when the Evans took
possession of Lots 29 and 30.
28. Plaintiffs now seek to maintain the use of the Dock that is imbedded into the surface
of MB Harbour’s Canal Property, without any consideration and declaring the negotiated terms of
the Canal Use Agreement “illegal,” among other things. See, e.g., Amended Petition at 8-9.
Defendants assert their rights under the Canal Use Agreement and the rights under long-standing
Texas law that protects subsequent purchasers of real property, like themselves, from unrecorded
real property instruments that they had no notice of, and that was not discovered even after
substantial investigation and inquiry.
ARGUMENT AND AUTHORITIES
29. Summary judgment is appropriate when a defendant can disprove at least one
element of a plaintiff's cause of action as a matter of law or when no genuine issue of material fact
exists. Stanfield v. Neubaum, 494 S.W.3d 90, 96 (Tex. 2016); Boerjan v. Rodriguez, 436 S.W.3d
307, 310 (Tex. 2014); Nall v. Plunkett, 404 S.W.3d 552, 555 (Tex. 2013). Summary Judgment is
also appropriate when summary-judgment evidence establishes an affirmative defense as a matter
of law. Tex. R. Civ. P. 166a(c); Johnson & Johnson Med., Inc. v. Sanchez, 924 S.W.2d 925, 927
(Tex. 1996).
30. Under the Uniform Declaratory Judgments Act (“UDJA”), a “person interested
14
under a deed, will, written contract, or other writings constituting a contract or whose rights, status,
or other legal relations are affected by a statute, municipal ordinance, contract, or franchise may
have determined any question of construction or validity arising under the instrument, statute,
ordinance, contract, or franchise and obtain a declaration of rights, status, or other legal relations
thereunder.” Tex. Civ. Prac. & Rem. Code Ann. § 37.004 (a).
31. Plaintiffs seek a multitude of declaratory judgments from this Court. Defendants,
in addition to their affirmative defenses, have asserted counter-claims against the Plaintiffs.
I. Plaintiffs seek a declaration that they have easements to use MB Habour’s Property in
the Glen Cove Canal—they do not.
32. Plaintiffs allege that they are the “lawful holders of express easement rights on and
to the Glen Cove Waterway”4 and “that they are the lawful holders of easement rights by
implication, prescription and/or estoppel.” Plaintiffs’ Amended Petition at 8 ¶¶ 22-23. Plaintiffs
seek declarations from this Court under the Declaratory Judgments Act, Chapter 37 of the Texas
Civil Practice & Remedies Code, declaring such. Id. All of these rights are interests in real property
that relate to the Plaintiffs’ use of the real property they claim to own that is legally described as
Lots 29 and 30, Block 4, Glen Cove according to the map or plat thereof, recorded in Volume 6,
Page 83, Map Records, Galveston County, Texas, (“Lots 29 and 30”) and with the commonly
known address of 2122 Cove Park Drive. See Exhibit 11, Evans’ Deed.
33. A property owner's right to exclude others from his or her property is recognized
as “‘one of the most essential sticks in the bundle of rights that are commonly characterized as
4
Plaintiffs appear to refer ubiquitously to the Glen Cove Waterway as, “Glen Cove [subdivision]
is divided by a canal (hereinafter the ‘Glen Cove Canal’ or the ‘Glen Cove Waterway’) which runs
through and divides the subdivision.” Amended Petition at 2-3. The MB Harbour Property runs
under much of this canal, but as indicated above, some surrounding area outside of the MB Harbour
Canal Property is also covered by water.
15
property.’ ”Marcus Cable Associates, L.P. v. Krohn, 90 S.W.3d 697, 700 (Tex. 2002). “A
landowner may choose to relinquish a portion of the right to exclude by granting an easement, but
such a relinquishment is limited in nature.” Id. “Unlike a possessory interest in land, an easement
is a nonpossessory interest that authorizes its holder to use the property for only particular
purposes.” Id.
A. Plaintiffs do not have an express easement to put a boat dock on the surface of
MB Harbour’s Property.
a. Express easements.
34. An easement is a non-possessory interest in another's property that authorizes the
holder to use that property for a particular purpose. Seber v. Union Pac. R. Co., 350 S.W.3d 640,
646 (Tex. App.—Houston [14th Dist.] 2011, no pet.). A written instrument is required to validly
convey an estate or interest in land that is to last for more than one year. See, Tex. Prop. Code Ann.
§ 5.021 (“A conveyance of an estate of inheritance, a freehold, or an estate for more than one year,
in land and tenements, must be in writing and must be subscribed and delivered by the conveyor
or by the conveyor's agent authorized in writing.”5). “An easement is an interest in land which is
subject to the Statute of Frauds.” Pick v. Bartel, 659 S.W.2d 636, 637 (Tex. 1983). Therefore,
under Texas law, to create or establish an express easement the statute of frauds applies, and a
writing is required.
35. Plaintiffs only argument that they have an express easement to put a boat structure
in the surface of MB Harbour’s property is that they have an express easement granted to them by
5
“Freehold” n. (15c) 1. An estate in land held in fee simple, in fee tail, or for term of life; any real-
property interest that is or may become possessory. • At common law, these estates were all created
by enfeoffment with livery of seisin. 2. The tenure by which such an estate is held. — Also termed
freehold estate; estate in freehold; freehold interest; frank-tenement; liberum tenementum.
FREEHOLD, Black's Law Dictionary (11th ed. 2019).
16
the Pollard Letter. The Pollard Letter, which is attached to Plaintiffs’ Amended Petition as Exhibit
1, is an unrecorded, unverified, unwitnessed, and non-notarized document.6 Plaintiffs plead that
the Pollard Letter “acknowledged and declared the easement rights of Glen Cove homeowners
with property adjacent to the [MB Harbour Canal]7 to construct [] improvements on that canal.”
See, Amended Petition at 4 (Emphasis added.). Plaintiffs further plead, incorrectly, that,
“Plaintiffs’ home adjoins the [MB Harbour Canal] and thus Plaintiffs are easement holders
contemplated under the” Pollard Letter.8 Amended Petition at 4.
36. Plaintiffs also contend that they were “granted rights in the 1928 plat of the Glen
Cove subdivision,” but do not elaborate on the extent of these rights. See, Exhibit 16, Plaintiffs’
Answers to Interrogatory No. 2. Plaintiffs plead some alleged rights regarding the 1928 plat, by
referencing its private dedication from the Plat’s grantor, Owen Smith, where he states that he
hereby “dedicate[s] for use of property owners only, all boulevards, streets, parks and playgrounds
as shown thereon.” Exhibit 5. However, Plaintiffs cannot demonstrate any limitation or
infringement of the Plaintiffs’ “use” of the “boulevards, streets, parks and playgrounds” as shown
on the 1928 Plat by MB Harbour or anyone else. Therefore, any rights held by the Plaintiffs arising
from this document appear to be moot with respect to this lawsuit.
37. Thus, Plaintiffs only claim that that they have an express easement for the Boat
Dock structure built by the Kings and subject to the Canal Use Agreement on the surface of MB
6
Plaintiffs attached to their Amended Petition as Exhibit 1, what purports to be a letter from
Douglas Pollard, Trustee to the Houston Lighting & Power Company. References in this Motion
to Exhibit 1 of Plaintiffs Amended Petition are referred to herein as the “Pollard Letter.”
7
See, supra, FN 4 and Plaintiffs’ Amended Petition Exhibit 1, Plaintiffs refer to the Glen Cove
Waterway in their Amended Petition, but the Pollard Letter, Plaintiffs’ Amended Petition Exhibit
1 refers to 6.01 acres of land that was ultimately conveyed to MB Harbour and is at issue in this
lawsuit.
8
See, supra, FN’s 4 and 7.
17
Harbour’s Property, is based on the Pollard Letter.
b. Easement rights by implication, prescription, and/or estoppel.
38. Plaintiffs also seek a declaration from this Court that they are “lawful holders of
easement rights by implication, prescription, and/or estoppel.” Plaintiffs Amended Petition at 9.
However, nowhere have Plaintiffs clarified where on the ground, or to what extent, they have rights
to place the boat structure at issue in this lawsuit, or any other right to place structures or use, the
surface of MB Harbour’s property. They have provided no facts whatsoever regarding the nature
of rights that they believe they have obtained by “implication, prescription, and or estoppel.”
Plaintiffs do state that they have “the right to maintain piers, docks, and boathouses and similar
property on the canal.” Plaintiffs’ Answer to Interrogatory 7. But when asked what the basis is of
Plaintiffs claims for easement rights by implication and/or estoppel, Plaintiffs appear to argue that
they have acquired easement rights by “implication and/or estoppel” with respect to Lots 29 and
30 by virtue of the use of other real property (i.e., not Lots 29 and 30) by other Glen Cove residents
(i.e., not the Plaintiffs or their predecessors in interest to Lots 29 and 30). See, Plaintiffs Answer
to Interrogatory No. 2.
39. Plaintiffs allege that they are the holders of “easement rights by . . . prescription.”
Amended Petition at 9. “A person acquires a prescriptive easement by the open, notorious,
continuous, exclusive, and adverse use of someone else's land for ten years.” Stallman v. Newman,
9 S.W.3d 243, 248 (Tex. App.—Houston [14th Dist.] 1999, pet. denied). “Burdening another's
property with a prescriptive easement is not well-regarded in the law.” Toal v. Smith, 54 S.W.3d
431, 435 (Tex. App.—Waco 2001, pet. denied). While Defendants deny that any predecessor in
interest to them owning Lots 29 and 30 had acquired a prescriptive easement for the land occupied
by the Boat Dock, as discussed below, any such right was affirmatively extinguished by the Kings.
18
The Kings use of MB Harbour’s land was not “adverse” as they had negotiated to obtain
permission to use it. The fact is was not adverse defeats this claims as a matter of law. The Evans
have not made use of the Boat Dock for ten years prior to suit being filed, therefore, as a matter of
law, Plaintiffs claim to have acquired a prescriptive easement fails.
40. Plaintiffs allege that they have acquired “easement rights by . . . estoppel.” Amended
Petition at 9. The doctrine of easement by estoppel “essentially holds that the owner of the alleged
servient estate may be estopped to deny the existence of an easement by making representations
that have been acted upon by the owner of the alleged dominant estate.” Stallman v. Newman, 9
S.W.3d 243, 246 (Tex. App.—Houston [14th Dist.] 1999, pet. denied). “Three elements are
necessary to the creation of an easement by estoppel: 1) a representation communicated, either by
word or action, to the promisee; 2) the communication was believed; and 3) the promisee relied
on the communication.” Id. “Being a creature of equity, [easement by estoppel] seeks to prevent
injustice and to protect innocent parties from fraud.” Id. Here, the facts are precisely the opposite.
The Evans were readily aware that the only use of the Boat Dock was as a result of the Canal Use
Agreement—well before they purchased the property. They have presented no evidence of any
communication by MB Harbour or the Kings that gives rise to the creation of an easement by
estoppel.
41. While there are substantial flaws with the Plaintiffs’ claims regarding the Pollard
Letter as an easement in their favor, and their assertion that they are the “lawful holders of
easement rights by implication, prescription, and/or estoppel,” these flaws do not even need to be
reached to resolve this matter, because all of these claims are controlled by the previously recorded
Canal Use Agreement.
I. The Canal Use Agreement Controls and is binding on the Plaintiffs.
19
42. Evans’ predecessors in interest, the Kings, executed and entered into the Canal Use
Agreement with MB Harbour. The Canal Use Agreement created a covenant running with the land
that, among other things, acknowledges MB Harbour’s superior rights in its MB Harbour Canal
property to that of the owners of Lots 29 and 30.
43. Specifically, the Kings “covenant[ed], “agree[d],” and “grant[ed]” as the “owner in
fee of Lots 29 and 30 in Block 4 of the Glen Cove subdivision” that:
[They were] desirous of acquiring from [MB Harbour], under the terms and
conditions [of the Canal Use Agreement], the use, privilege and license of
the portion of the Canal as described and/or depicted on the EXHIBIT "B"
attached hereto ("License Area") for the existing residential boat dock
and/or pier as depicted on the photograph(s) attached hereto as EXHIBIT
"C" ("Existing Improvements") . . . .
- Exhibit 14, Canal Use Agreement at 1.
...
for and in consideration of the mutual promises herein contained and certain
other good and valuable consideration mutually exchanged, the receipt and
sufficiency of which is acknowledged, the parties hereto do hereby
covenant, agree and grant as follows:
- Id. at 1.
...
Licensee agrees that [MB Harbour] is the owner of the Canal and that
Licensee has no right, title or interest therein whatsoever, except such
as is expressly granted in this Agreement. Licensee acknowledges that
the presence of the Existing Improvements in the Canal in the absence of
this Agreement is a trespass and an encroachment on the property of
Licensor.
- Id. at 3 (Emphasis added).
[T]he license granted herein shall become a covenant running with land
and shall attach to [Lots 29 and 30] and in no event whatsoever shall be
separated or divisible in any form or manner from the ownership of
[Lots 29 and 30].
- Id. at 8 (emphasis added).
A. The Canal Use Agreement created a covenant running with the land.
44. Under Texas Law, “a covenant runs with the land when it touches and concerns the
20
land; relates to a thing in existence or specifically binds the parties and their assigns; is intended
by the original parties to run with the land; and when the successor to the burden has notice.”
Inwood N. Homeowners' Ass'n, Inc. v. Harris, 736 S.W.2d 632, 635 (Tex. 1987). Some courts have
further held that there “must also be privity of estate between the parties when the covenant was
made.” Ehler v. B.T. Suppenas Ltd., 74 S.W.3d 515, 521 (Tex. App.—Amarillo 2002, pet. denied).
All of these elements are present here.
1. The Canal Use Agreement “touches and concerns” the land.
45. “Texas courts have held that covenants running with the land are those affecting
the nature, quality, or value of the subject property.” Lennar Homes of Tex. Land & Constr., Ltd.
v. Whiteley, 625 S.W.3d 569, 577 (Tex. App.—Houston [14th Dist.] 2021, pet. filed), reh'g denied
(Aug. 3, 2021). Here, MB Harbour is burdening its land with the presence of a boat dock that it
does not otherwise enjoy the use of. The owners of Lots 29 and 30 are receiving the benefit of the
burden, by being able to place the structure on MB Habour’s property, in exchange for the payment
of an annual fee. For example, this consideration can be used to maintain the navigability of MB
Harbour’s property or for other purposes, but ultimately the owners of Lots 29 and 30 still receive
the benefit of MB Harbour’s burdened property, as long as they adhere to all of the terms of the
Canal Use Agreement. For example, a “covenant to pay maintenance assessments for the purpose
of repairing and improving [] common areas and recreational facilities” has been held to touch and
concern the land. Inwood N. Homeowners' Ass'n, Inc. v. Harris, 736 S.W.2d 632, 635 (Tex. 1987);
See, also, Supkis v. Madison Place Homeowners' Ass'n., Inc., No. 01-07-00573-CV, 2008 WL
2465788, at *4 (Tex. App.—Houston [1st Dist.] June 19, 2008, pet. denied) (holding that fee-
assessment provisions for maintenance of areas that relate to the use and enjoyment of property
“touches and concerns the land”).
21
46. Specifically, as recited in the Canal Use Agreement, the Kings were desirous of
obtaining from MB Harbour the “use, privilege and license of the portion of” the surface of MB
Habour’s property, that is clearly defined in the Canal Use Agreement, to place a boat dock that
they could use and enjoy from their property located on Lots 29 and 30. Exhibit 14, Canal Use
Agreement at 1. This “touches and concerns” both parties’ land, and affects “the nature, quality,
or value of the subject property.” Accordingly, this element is established as a matter of law.
2. The Canal Use License Agreement “relates to a thing in existence.”
47. There is no question that the Canal Use Agreement relates to a boat dock on fixed
pilings that sits on the surface of MB Harbour’s Canal property to be used by the owners of Lots
29 and 30. This element is conclusively established as a matter of law.
3. The Canal Use Agreement was “intended by the original parties to run with the
land.”
48. As detailed above, the Canal Use Agreement expressly provides:
[T]he license granted herein shall become a covenant running with land
and shall attach to [Lots 29 and 30] and in no event whatsoever shall be
separated or divisible in any form or manner from the ownership of
[Lots 29 and 30].
Thus, the original parties intended the agreement to run with the land. Further supporting
this reading, that it runs with the land and is not personal to the Kings, is that it was “non-
transferable and non-assignable by Licensee except to a subsequent purchaser of” Lots 29
and 30. Exhibit 14 at 8. Once again, this element is conclusively established as a matter of
law.
4. The Plaintiffs, as the successors to the burden, had notice of the burden.
49. As discussed above, the Evans purchased Lots 29 and 30 with constructive and
actual notice of the Canal Use Agreement. “Under Texas law, constructive notice is notice given
22
by properly recorded instruments and charged to a person as a matter of law, regardless of the
person's actual knowledge.” Matter of Hamilton, 125 F.3d 292, 299 (5th Cir. 1997). Indeed, Tex.
Prop. Code Ann. § 13.002 provides: “An instrument that is properly recorded in the proper county
is: (1) notice to all persons of the existence of the instrument; and (2) subject to inspection by the
public.” The Canal Use Agreement was recorded in the Official Real Property Records of
Galveston County.9 The Plaintiffs, therefore, had constructive notice of the Canal Use Agreement
as a matter of law. The Plaintiffs incorrectly contend that the Canal Use Agreement was not a
“recordable real property interest” (a point Defendants address thoroughly below), but irrespective,
the Plaintiffs admit they had actual notice of the Canal Use Agreement.
50. David Evans testified during his deposition “there was no doubt that [he] and [his]
wife had seen [the] Canal Use License Agreement” before they agreed to the purchase of Lots 29
and 30 from the Kings. Exhibit 15, Deposition Transcript of David Evans at 130:16-21. David
Evans further testified that he reviewed the document on behalf of himself and his wife. Id. at
130:25-131:08.
22 Q. And you were paying over half a million
23 dollars for the purchase of this property, correct?
24 A. Correct.
25 Q. So I take it you would have reviewed this
1 license agreement and understood what it says?
2 A I did.
- Exhibit 15 at 130:22-131:02.
Evans further testified:
9
23
9· Q·And so you knew that there was a Canal Use
10·License Agreement that had been executed by MB Harbour
11·and Claudia King prior to your purchase of the property
12·from the Kings?
13·A.·Correct
- Exhibit 15 at 131:9-13
51. Evans also testified that, in January or February of 2020, months before he
consummated his purchase of Lots 29 and 30 in August of 2020, he was aware of the Canal Use
Agreement and even contacted MB Harbour to discuss it with them. Id. at 134:16-135:16.
Moreover, it is indisputable that a copy of the Canal Use Agreement was included and appended
to the ONE TO FOUR FAMILY RESIDENTIAL CONTRACT (RESALE) executed by the Kings
and the Evans on July 6, 2020, when the Kings sold Lots 29 and 30 to them. It is also indisputable
that the Evans initialed the same copy of the Canal Use Agreement as part of the acknowledgments
made at the closing on Lots 29 and 30. See, Exhibit 10 at 23-40. See also, Evans testimony, Exhibit
15 at 109:2-4 (Q. . . . . And I take it you had an opportunity to review the sales document, sales
agreement, and all the attachments and exhibits to it? A. That is correct.”). There is absolutely no
question that Plaintiffs had actual notice of the Canal Use Agreement. Accordingly, Plaintiffs had
both actual and constructive notice of the Canal Use Agreement that was a covenant running with
the property as a matter of law.
5. There is privity of estate between the original parties to the Canal Use Agreement
and the Plaintiffs.
52. When the Canal Use Agreement was entered into by MB Harbour and the Kings,
on October 26, 2017, the Kings were the fee simple owners of Lots 29 and 30. MB Harbour was
the fee simple owner of its Canal Property. As discussed above, the parties contractually and
24
through Texas real property law entered into an agreement with each other for one party to have
the limited use of the other party’s property for the detailed consideration. There is privity of estate
between the Kings and the Evans. Privity of estate means there must be a mutual or successive
relationship to the same rights of the property. MJR Oil & Gas 2001 LLC v. AriesOne, LP, 558
S.W.3d 692, 700 (Tex. App.—Texarkana 2018, no pet.).
53. The Evans succeeded to the same rights of Lots 29 and 30 when they received a
deed conveyance from the Kings. See, In re Chesapeake Energy Corp., 622 B.R. 274, 283 (Bankr.
S.D. Tex. 2020) (“An easy example of vertical privity is the transfer of a person's fee estate to
another.”) Those rights included the negotiated rights of the covenant of use regarding the Boat
Dock as set out in the Canal Use Agreement.
54. For all of these reasons, the Canal Use Agreement is a covenant running with the
land as it concerns MB Harbour’s Canal Property and Lots 29 and 30; therefore, the Evans are
bound by the Canal Use Agreement as a matter of law.
B. Even if the Canal Use Agreement were determined to not be a covenant running
with the land, the Plaintiffs are still bound by its terms.
55. On its own terms, the Canal Use Agreement was in force when Lots 29 and 30 were
conveyed to the Evans from the Kings on August 12, 2020. The Canal Use Agreement provides
for a term of “one (1) year from the date hereof, and shall be renewable by Licensee for consecutive
one-year terms by payment by Licensee of the Base Licensee Fee. See, Exhibit 14 at Section 6.
License Fee (a). The Kings had complied with the terms of the agreement and it was in force on
August 12, 2020. For example:
• On or about September 8, 2017, the Kings’ boat dock was inspected by
Norex Engineering on behalf of MB Harbour. Exhibit 18, September 8,
2017, Letter from Norex Engineering.
• On or about May 17, 2017, the Kings paid the annual assessment fee.
25
Exhibit 19.
• On or about September 22, 2017, the Kings submitted a certificate of
insurance to MB Harbour. Exhibit 20.
• On or about, October 26, 2017, the Kings executed the Canal Use
Agreement. Exhibit 14.
• On or about October 10, 2018, the Kings paid the Agreement’s annual
assessment fee thru October 2019. Exhibit 21.
• On or about October 4, 2019, the Kings paid the annual assessment fee
thru October 2020. Exhibit 22.
56. Thus, on its own terms the Canal Use Agreement was still in effect as of the date
of the Evans’ purchase of and closing on Lots 29 and 30 in August of 2020. As a result, since the
Canal Use Agreement was in effect and the Evans had actual and constructive notice of it, they
took the property subject to, among other terms, these:
Preview
Filed: 9/13/2022 10:41 AM JOHN D. KINARD - District Clerk Galveston County, Texas Envelope No. 68193764 By: Shailja Dixit 9/13/2022 10:56 AM No. 21-CV-0305 DAVID AND CONNIE EVANS, § IN THE DISTRICT COURT OF § Plaintiffs, § § v. § GALVESTON COUNTY, TEXAS § MB HARBOUR, LTD. AND HARBOUR § MANAGEMENT, LLC § § Defendants. § 10th JUDICIAL DISTRICT MB HARBOUR, LTD. AND HARBOUR MANAGEMENT, LLC’S TRADITIONAL MOTION FOR SUMMARY JUDGMENT TO THE HONORABLE JUDGE OF THIS COURT: Defendants MB Harbour, LTD. (“MB Harbour”) and Harbour Management, LLC (“Harbour Management”) (collectively, “Defendants”) file this motion for summary judgment (the “Motion”) and ask the Court sign a summary judgment against David and Connie Evans’ (“Plaintiffs” or the “Evans”) various requests for declaratory judgment, and show: SUMMARY • Plaintiffs seek various declarations by this Court against Defendants to, among other things, allow Plaintiffs to use MB Harbour’s property for free, to otherwise limit and restrain MB Harbour’s use of its own property, and to even have this Court declare that MB Harbour does not own property that it has paid or invested hundreds of thousands of dollars to purchase and improve. • To achieve these ends, Plaintiffs ask the Court to set aside a contractual real property covenant entered into by Plaintiffs’ immediate predecessors in interest, of which Plaintiffs readily concede they had actual knowledge; to set aside more than one hundred and fifty years of Texas jurisprudence that protects subsequent purchasers without notice of unrecorded real property instruments; and, to create new law in contravention of Texas’ longstanding trespass to try title jurisprudence, and simply declare that MB Harbour no longer owns the property that it paid considerable money for. 1 • While Plaintiffs’ claims fail for many reasons, before even reaching these many reasons, there are three issues that are decisive in this case, as a matter of law: (1) Plaintiffs are bound by a contractual covenant entered into by their predecessors in interest to Lots 29 and 30 that unequivocally recognized MB Harbour’s superior title in MB Harbour’s property and expressly terminated and abandoned any prior rights or easements to the extent any existed over MB Harbour’s property; (2) Texas law protects innocent purchasers of real property against unrecorded instruments of which they had no notice; and, (3) Plaintiffs have failed to properly plead, and have failed to prove MB Harbour does not own the land it paid for. SUMMARY-JUDGMENT EVIDENCE AND REQUEST FOR JUDICIAL NOTICE 1. Pursuant to Texas Rule of Civil Procedure 166a(d), MB Harbour intends to use the discovery and instruments referred to and cited as summary judgment proof. Additionally, MB Harbour relies upon all pleadings, documents, discovery products, and motions and responses on file with the District Clerk in this matter at the time of the hearing for summary judgment, the evidence contained in or attached to this motion for summary judgment, and the evidence and exhibits filed with and accompanying any response or supplements to this motion. Exhibit Description No. Affidavit of Teresa Scotto, Vice President of MB Harbour, with 1. attached business records. Affidavit of Robert Ellis, including attached business records and 2. surveys completed as part of his expert report and produced in this matter. Affidavit of Marc D. Young, attesting records received from 3. Independence Title and NRG in response to non-party subpoenas and related requests. 2 MB Harbour Canal Deed, September 15, 2006 deed from NRG to MB 4. Harbour recorded in the Official Galveston County Real Property Records with document number 2006067603. MB Harbour Canal Deed, Correction Deed issued to MB Harbour by NRG on or about February 8, 2008, with the same effective date of the 5. original deed, September 15, 2006, recorded in the Official Galveston County Real Property Records with document number 2008007810. Survey for MB Harbour, LTD. performed by Huitt-Zollars on or about 6. August 9, 2006. (See, Exhibit 1 for authentication.) 7. Glen Cove Plat recorded in 1928. Volume 6, Page 83, Map Records. 1958 and 1969 Aerial Photographs from EDR Environmental Data 8. Resources. (See, Exhibit 1 for authentication.) April 18, 2007 United States Army Corps of Engineers (“USACE”) 9. Letter to MB Harbour. (See, Exhibit 1 for authentication.) ONE TO FOUR FAMILY RESIDENTIAL CONTRACT (RESALE) with DocuSign unique envelope identification number 65DDF5E3- 10. DE3E-44C5-A316-E215A97643E2 (“The Sales Contract”). (See Exhibit 3 and Business Records Affidavit from Independence Title appended to end of Exhibit for authentication.) Kings’ Deed to Evans or Evans’ Deed with an instrument date of August 12, 2020 and recorded in the Official Galveston County Real 11. Property Records on August 13, 2020 with document number 2020049449. Survey from Robert Ellis with survey overlaying 2012 satellite image. 12. (See, Exhibit 2 for authentication.) Darr Deed to Kings, recorded in the Official Galveston County Real 13. Property Records on December 26, 2014 with document number 2014072604 Canal Use Agreement recorded in the Official Galveston County Real 14. Property Records with document number 2017073505. 15. Transcript of David Evans deposition taken July 12, 2022. 3 November 28, 2006 Texas General Land Office (“GLO”) Memorandum from Bill O’Hara, Director, Surveying Division, Subject: Status of Glen Cove Lake in Galveston County. This document was Exhibit 16 to Plaintiffs’ designated expert witness and 16. witness, Paul Smith. Smith confirmed at his deposition that these copies “reflect [his] communications with the Texas General Land Office in October, November of 2006 and December of 2007. See, Paul Smith Deposition Transcript, 139:13-140:09. Plaintiffs Answers and Responses to Defendants’ Discovery 17. Requests served January 28, 2022. (Excludes Request for Production Responses.) September 8 2017, Letter from Norex Engineering on behalf of MB 18. Harbour. (See, Exhibit 1 for authentication.) 2017 Canal use fee payment from the Kings to MB Harbour. (See, 19. Exhibit 1 for authentication.) Certificate of Insurance for the boat dock submitted to MB Harbour 20. by the Kings. (See, Exhibit 1 for authentication.) 2018 Canal use fee payment from the Kings to MB Harbour. (See, 21. Exhibit 1 for authentication.) 2019 Canal use fee payment from the Kings to MB Harbour. (See, 22. Exhibit 1 for authentication.) Tim Gamble Boat Dock License issued by Texas Genco in June, 23. 2004. (Documents produced in Plaintiffs’ Paul Smith’s Workfile. License also referenced in Exhibit 1) Texas Genco Template License Agreements (Documents produced 24. in Plaintiffs’ Paul Smith’s Workfile.) Lease issued for the construction of a boat dock on or around July 25. 30, 1976. (NRG Document, See Exhibit 3 for authentication.) BACKGROUND & INDISPUTABLE FACTS A. MB Harbour is the fee simple owner of the property Plaintiffs seek to permanently impair. 4 2. MB Harbor is the fee simple owner of real property located in Galveston County, Texas. Exhibit 1, Affidavit of Teresa Scotto. Among its Galveston County property, is a 6.01 acre tract that MB Harbour purchased from NRG1 in 2006 (the “MB Harbour Canal” or “MB Harbour Property”).2 Id. The majority of the MB Harbour Canal is (and was at the time of MB Harbour’s purchase) submerged beneath water, and connects to Clear Lake. Id. This water is what is commonly called the HL&P Canal, HL&P Genco Canal, the Glen Cove Canal, or the MB Harbour Canal. Some of the land surrounding the 6.01 acre tract purchased by MB Harbour is also covered by water. 3. MB Harbour purchased this property to revitalize the existing MB Harbour Canal through dredging and other earthwork, and to connect it to a larger real estate development project it initiated, that would create a new, navigable canal, turn an existing ‘ditch,’ into a navigable canal, and that would, in turn, connect with and flow into the MB Habour Canal. Id. 4. MB Harbor obtained fee simple title of its property, the MB Harbour Canal from NRG Texas LP through a bona fide purchase of the property for $290,859.40 cash consideration on or about September 15, 2006. Exhibits 1 and 4, First NRG Deed to MB Harbour. The MB Harbour Canal was conveyed to MB Harbour from NRG by means of a special warranty deed that was recorded in the Official Galveston County Real Property Records on October 4, 2006, with document number 2006067603. Exhibit 4. A correction deed was issued on or about February 8, 2008, by NRG with the same effective date of the original deed, September 15, 2006 (the “MB 1 NRG Texas, LP, a Texas Limited partnership (successor to Texas Genco II, LP). 2 Reference to the MB Harbour Canal Property in this motion refers to the defined 6.01 acres that was conveyed to MB Harbour by NRG. References to the Glen Cove Canal refer to all areas covered by water, to include the MB Harbour Canal Property and anything surrounding it that is also covered by water. 5 Harbour Deed”), and was recorded in the Official Galveston County Real Property Records on February 12, 2008, with document number 2008007810. Exhibit 5, NRG Deed to MB Habour. 5. The MB Harbour Canal property is generally depicted below in what is described as Tract 7, and surrounded by the bolded outline (cut away image from Exhibit 6) : - Exhibit 6, Image from Huitt-Zollars’ Survey. 6. On either side of MB Harbour’s Canal is an area that is commonly called the Glen Cove Subdivision that was first platted in 1928: 6 - From Exhibit 7, Glen Cove Plat recorded January 7, 1928 in Volume 6, Page 83, Map Records, Galveston County, Texas. 7. There was no canal originally. As seen in the above plat, the area was upland marsh, and was designated “Glen Cove Lake (Proposed)” and “Reserved” on the Plat. The fact that this land did not regularly contain water and was not more than an upland marsh is confirmed by aerial imagery from 1958: 7 - From Exhibit 8, Aerial Photographs from EDR Environmental Data Resources 1958 photo. 8. The MB Harbour Canal was created in the 1960’s through HL&P’s excavation, earthwork, and dredging. The Canal was originally created to be used as a discharge canal for cooling water from HL&P’s Webster power plant. As evident from the above image and the original plat, prior to its creation, the MB Harbour Canal was not a waterway at all, much less navigable. It is not a natural water feature—it was manmade. 9. By 1969, the first form of the canal was in place and filled with water, flowing into Clear Lake (red outline of general canal area, connecting to other canal sections): - From Exhibit 8, 1969 Aerial Photograph from EDR Environmental Data Resources (Red outline added by the author of this motion; not to scale.). 10. Local, state, and federal authorities have long recognized the canal as a private waterway whose submerged surface is privately owned. For example, an April 18, 2007 letter from the Section Chief of the local compliance section of the United States Corp of Engineers 8 (“USACE”) to MB Harbour stated: “This waterway is considered a manmade discharge canal that was permitted to HL&P for connecting the canal to navigable waters, Clear Lake.” Exhibit 9, Letter from USACE. 11. MB Harbour does not seek to prohibit those complying with federal and state law to ingress and egress over and upon the water over its property. Exhibit 1. MB Harbour has not prohibited those complying with federal and state law from ingressing and egressing over and upon the water over its property. Id. In fact, that free ingress and egress is a necessary feature of the residential development which prompted MB Harbour’s purchase and re-dredging of the canal property. 12. MB Harbour purchased this property as part of a larger, comprehensive real estate development project that MB Harbour refers to as the Cypress Bay Project (the “Cypress Bay Project” or the “Project”). See, Exhibit 1. The Cypress Bay Project involved the purchase and development of more than 56.487 acres of real property, which includes approximately 10 acres of canal tracts, in Galveston County, Texas, costing more than $15 million to purchase and develop the property. Id. The Cypress Bay Project developed this land and lead to the creation of the Cypress Bay subdivision (a residential subdivision), a self-storage marina facility, a waterfront shopping center, and other commercial property. Id. The development of Cypress Bay also allowed approximately 15 other properties in the Marina Del Sol Subdivision to become waterfront properties. Exhibit 1, Affidavit of Teresa Scotto. 13. The Project required MB Harbour hiring many different professionals and consultants, including surveyors, lawyers, civil engineers, construction companies, among others. Id. MB Harbour invested more than $1.5 million for the planning and execution of this project. Exhibit 1. When MB Harbour started this project, after its purchase in 2006, this 6.01 acres needed 9 to be dredged and was not freely navigable over much of the tract, because it had filled with silt and other sedimentary build up from drainage and incoming storms. Id. Prior to MB Habour’s purchase, the area had not been dredged since the 1960’s, MB Harbour has dredged the canal twice in the last 18 years. Id. B. Lots 29 and 30 of Block 4 of Glen Cove, now owned by the Plaintiffs. 14. Located south of the MB Harbour Canal, among the residential lots platted in 1928, are Lots 29 and 30 of Block 4 of Glen Cove (“Lots 29 and 30”).3 This property is also commonly known as 2122 Cove Park Drive, League City, Texas. The Plaintiffs purchased Lots 29 and 30 from Harold and Claudia King (collectively the “Kings”). 15. On or about July 6, 2020, both the Kings and the Evans executed a sales contract, ONE TO FOUR FAMILY RESIDENTIAL CONTRACT (RESALE), for the Evans’ purchase of Lots 29 and 30 from the Kings (the “Sales Contract”). See, Exhibit 10, The Sales Contract. The Sales Contract between the Parties was electronically signed through a commercial program called DocuSign and was given a unique envelope identification number by the program of 65DDF5E3- DE3E-44C5-A316-E215A97643E2 (“DocuSign 7643E2”). The only legal description provided in the Sales Contract was that of Lots 29 and 30. See, Exhibit 10 at 1. 16. On or about August 12, 2020, the Kings conveyed to the Evans Lots 29 and 30 with a warranty deed. See, Exhibit 11, Kings’ Deed to Evans recorded in the Official Galveston Real Property Records on August 13, 2020 with document number 2020049449. The only property described in the deed is: Lots 29 and 30, Block 4, GLEN COVE, according to the map or plat thereof, recorded in Volume 6, Page 83, Map Records, Galveston County, Texas. 3 The full legal description as recorded in the deed records is “Lots 29 and 30 of Block 4 of Glen Cove, according to the map or plat thereof, recorded in Volume 6, Page 83, Map Records, Galveston County, Texas.” See, Exhibit 13, Darr Deed. 10 17. Lots 29 and 30 are not adjacent to, do not abut, and never abutted what was originally described as Glen Cove Lake (Proposed). The Lots do not share a common boundary with what was originally described as Glen Cove Lake (Proposed). As depicted in this blown-up image from the original plat: - From Exhibit 7 (Close up image taken from plat showing boundary of reserve in between boundary of Lot 29 to the left of what is shown as Lot 30. 18. And today, Lots 29 and 30 are not adjacent to and do not abut the MB Harbour Canal. The Lots do not share a common boundary with the MB Harbour Property. Included in the executed sales contract was a survey, initialed by the Evans that conclusively establishes this fact: - From Exhibit 10, Sales Contract at 65, Survey initialed by the Evans. 11 19. The above image confirms that Lots 29 and 30 end at the line described as N 60° 15’ 23” E 49.98’. In a more recent survey performed by surveyor Robert Ellis which incorporates a 2012 satellite image underlay, you can see the cut in the remainder. The red arrow in the image below points to the barely visible boundary lines of Lots 29 and 30: Lots 29 and 30 Boundary - From Exhibit 12, Image from Survey of Ellis Surveying. 20. Also appended to the Sales Contract is a copy of the Canal Use License Agreement (“Canal Use Agreement”). See, Exhibit 10 at 23-40. This copy of the Canal Use Agreement has the same electronic identification number on the top of each page of the document confirming that it was a part of the Sales Agreement. Id. The Canal Use Agreement was also electronically initialed by both David and Connie Evans. Id. at 40 (Bates labeled 220). C. The Canal Use Agreement. 21. On or about November 21, 2014, the Kings purchased 2122 Glen Cove from Vance and Holly Darr (the “Darrs”). See Exhibit 13, Darr Deed to Kings, recorded in the Official Galveston County Real Property Records on December 26, 2014 with document number 2014072604. 22. The Deed from the Darrs to the Kings provided: 12 Grantor, for the Consideration and subject to the Exceptions to Conveyance and Warranty, grants, sells, and conveys to Grantee the Property, together with all and singular the rights and appurtenances thereto in any way belonging, to have and to hold it to Grantee and Grantee's heirs, successors, and assigns forever. – Id. 23. On or about October 26, 2017, the Kings, as Licensee, executed the Canal Use Agreement with MB Harbour, as Licensor, to give the limited use of real property owned by MB Harbour in the MB Harbour Canal to erect a boat dock (the “Boat Dock”) on its surface. See Exhibit 14, the Canal Use Agreement. The Canal Use Agreement was recorded in the Official Galveston County Real Property Records on December 4, 2017 with document number 2017073505. Id. 24. The Canal Use Agreement provides, among other things: Licensee agrees that Licensor is the owner of the Canal and that Licensee has no right, title or interest therein whatsoever, except such as is expressly granted in this Agreement. Licensee acknowledges that the presence of the Existing Improvements in the Canal in the absence of this Agreement is a trespass and an encroachment on the property of Licensor. - Exhibit 14, Canal Use Agreement, at 2. (Emphasis added). [I]t is agreed and understood by Licensee that the rights, privileges and obligations conferred and imposed upon Licensee by this Agreement may not be sold, conveyed, devised, assigned or sublet by Licensee except to a subsequent purchaser of [Lots 29 and 30], and by the purchase of [Lots 29 and 30] any such subsequent purchaser fully and without reservation accepts the rights and obligations imposed by the Agreement and license granted herein. - Id. at 8 (emphasis added). [T]he license granted herein shall become a covenant running with land and shall attach to [Lots 29 and 30] and in no event whatsoever shall be separated or divisible in any form or manner from the ownership of [Lots 29 and 30]. - Id. (emphasis added). 25. Per the terms of Canal Use Agreement, the Kings paid an annual fee of $2,500 to MB Harbour for their benefits under it. Id. at 4-5. The Canal Use Agreement further provides that 13 MB Harbour has the right to remove the Boat Dock at the expense of the Licensee. See Id. at 5 and 9. 26. In addition, the Canal Use Agreement provided that if any party institutes a legal action for the enforcement of any right or obligation arising under its terms that the prevailing party “shall be entitled to recover its costs and reasonable attorneys’ fees.” Exhibit 14 at 9. 27. On its own terms, the Canal Use Agreement was still in effect when the Evans took possession of Lots 29 and 30. 28. Plaintiffs now seek to maintain the use of the Dock that is imbedded into the surface of MB Harbour’s Canal Property, without any consideration and declaring the negotiated terms of the Canal Use Agreement “illegal,” among other things. See, e.g., Amended Petition at 8-9. Defendants assert their rights under the Canal Use Agreement and the rights under long-standing Texas law that protects subsequent purchasers of real property, like themselves, from unrecorded real property instruments that they had no notice of, and that was not discovered even after substantial investigation and inquiry. ARGUMENT AND AUTHORITIES 29. Summary judgment is appropriate when a defendant can disprove at least one element of a plaintiff's cause of action as a matter of law or when no genuine issue of material fact exists. Stanfield v. Neubaum, 494 S.W.3d 90, 96 (Tex. 2016); Boerjan v. Rodriguez, 436 S.W.3d 307, 310 (Tex. 2014); Nall v. Plunkett, 404 S.W.3d 552, 555 (Tex. 2013). Summary Judgment is also appropriate when summary-judgment evidence establishes an affirmative defense as a matter of law. Tex. R. Civ. P. 166a(c); Johnson & Johnson Med., Inc. v. Sanchez, 924 S.W.2d 925, 927 (Tex. 1996). 30. Under the Uniform Declaratory Judgments Act (“UDJA”), a “person interested 14 under a deed, will, written contract, or other writings constituting a contract or whose rights, status, or other legal relations are affected by a statute, municipal ordinance, contract, or franchise may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract, or franchise and obtain a declaration of rights, status, or other legal relations thereunder.” Tex. Civ. Prac. & Rem. Code Ann. § 37.004 (a). 31. Plaintiffs seek a multitude of declaratory judgments from this Court. Defendants, in addition to their affirmative defenses, have asserted counter-claims against the Plaintiffs. I. Plaintiffs seek a declaration that they have easements to use MB Habour’s Property in the Glen Cove Canal—they do not. 32. Plaintiffs allege that they are the “lawful holders of express easement rights on and to the Glen Cove Waterway”4 and “that they are the lawful holders of easement rights by implication, prescription and/or estoppel.” Plaintiffs’ Amended Petition at 8 ¶¶ 22-23. Plaintiffs seek declarations from this Court under the Declaratory Judgments Act, Chapter 37 of the Texas Civil Practice & Remedies Code, declaring such. Id. All of these rights are interests in real property that relate to the Plaintiffs’ use of the real property they claim to own that is legally described as Lots 29 and 30, Block 4, Glen Cove according to the map or plat thereof, recorded in Volume 6, Page 83, Map Records, Galveston County, Texas, (“Lots 29 and 30”) and with the commonly known address of 2122 Cove Park Drive. See Exhibit 11, Evans’ Deed. 33. A property owner's right to exclude others from his or her property is recognized as “‘one of the most essential sticks in the bundle of rights that are commonly characterized as 4 Plaintiffs appear to refer ubiquitously to the Glen Cove Waterway as, “Glen Cove [subdivision] is divided by a canal (hereinafter the ‘Glen Cove Canal’ or the ‘Glen Cove Waterway’) which runs through and divides the subdivision.” Amended Petition at 2-3. The MB Harbour Property runs under much of this canal, but as indicated above, some surrounding area outside of the MB Harbour Canal Property is also covered by water. 15 property.’ ”Marcus Cable Associates, L.P. v. Krohn, 90 S.W.3d 697, 700 (Tex. 2002). “A landowner may choose to relinquish a portion of the right to exclude by granting an easement, but such a relinquishment is limited in nature.” Id. “Unlike a possessory interest in land, an easement is a nonpossessory interest that authorizes its holder to use the property for only particular purposes.” Id. A. Plaintiffs do not have an express easement to put a boat dock on the surface of MB Harbour’s Property. a. Express easements. 34. An easement is a non-possessory interest in another's property that authorizes the holder to use that property for a particular purpose. Seber v. Union Pac. R. Co., 350 S.W.3d 640, 646 (Tex. App.—Houston [14th Dist.] 2011, no pet.). A written instrument is required to validly convey an estate or interest in land that is to last for more than one year. See, Tex. Prop. Code Ann. § 5.021 (“A conveyance of an estate of inheritance, a freehold, or an estate for more than one year, in land and tenements, must be in writing and must be subscribed and delivered by the conveyor or by the conveyor's agent authorized in writing.”5). “An easement is an interest in land which is subject to the Statute of Frauds.” Pick v. Bartel, 659 S.W.2d 636, 637 (Tex. 1983). Therefore, under Texas law, to create or establish an express easement the statute of frauds applies, and a writing is required. 35. Plaintiffs only argument that they have an express easement to put a boat structure in the surface of MB Harbour’s property is that they have an express easement granted to them by 5 “Freehold” n. (15c) 1. An estate in land held in fee simple, in fee tail, or for term of life; any real- property interest that is or may become possessory. • At common law, these estates were all created by enfeoffment with livery of seisin. 2. The tenure by which such an estate is held. — Also termed freehold estate; estate in freehold; freehold interest; frank-tenement; liberum tenementum. FREEHOLD, Black's Law Dictionary (11th ed. 2019). 16 the Pollard Letter. The Pollard Letter, which is attached to Plaintiffs’ Amended Petition as Exhibit 1, is an unrecorded, unverified, unwitnessed, and non-notarized document.6 Plaintiffs plead that the Pollard Letter “acknowledged and declared the easement rights of Glen Cove homeowners with property adjacent to the [MB Harbour Canal]7 to construct [] improvements on that canal.” See, Amended Petition at 4 (Emphasis added.). Plaintiffs further plead, incorrectly, that, “Plaintiffs’ home adjoins the [MB Harbour Canal] and thus Plaintiffs are easement holders contemplated under the” Pollard Letter.8 Amended Petition at 4. 36. Plaintiffs also contend that they were “granted rights in the 1928 plat of the Glen Cove subdivision,” but do not elaborate on the extent of these rights. See, Exhibit 16, Plaintiffs’ Answers to Interrogatory No. 2. Plaintiffs plead some alleged rights regarding the 1928 plat, by referencing its private dedication from the Plat’s grantor, Owen Smith, where he states that he hereby “dedicate[s] for use of property owners only, all boulevards, streets, parks and playgrounds as shown thereon.” Exhibit 5. However, Plaintiffs cannot demonstrate any limitation or infringement of the Plaintiffs’ “use” of the “boulevards, streets, parks and playgrounds” as shown on the 1928 Plat by MB Harbour or anyone else. Therefore, any rights held by the Plaintiffs arising from this document appear to be moot with respect to this lawsuit. 37. Thus, Plaintiffs only claim that that they have an express easement for the Boat Dock structure built by the Kings and subject to the Canal Use Agreement on the surface of MB 6 Plaintiffs attached to their Amended Petition as Exhibit 1, what purports to be a letter from Douglas Pollard, Trustee to the Houston Lighting & Power Company. References in this Motion to Exhibit 1 of Plaintiffs Amended Petition are referred to herein as the “Pollard Letter.” 7 See, supra, FN 4 and Plaintiffs’ Amended Petition Exhibit 1, Plaintiffs refer to the Glen Cove Waterway in their Amended Petition, but the Pollard Letter, Plaintiffs’ Amended Petition Exhibit 1 refers to 6.01 acres of land that was ultimately conveyed to MB Harbour and is at issue in this lawsuit. 8 See, supra, FN’s 4 and 7. 17 Harbour’s Property, is based on the Pollard Letter. b. Easement rights by implication, prescription, and/or estoppel. 38. Plaintiffs also seek a declaration from this Court that they are “lawful holders of easement rights by implication, prescription, and/or estoppel.” Plaintiffs Amended Petition at 9. However, nowhere have Plaintiffs clarified where on the ground, or to what extent, they have rights to place the boat structure at issue in this lawsuit, or any other right to place structures or use, the surface of MB Harbour’s property. They have provided no facts whatsoever regarding the nature of rights that they believe they have obtained by “implication, prescription, and or estoppel.” Plaintiffs do state that they have “the right to maintain piers, docks, and boathouses and similar property on the canal.” Plaintiffs’ Answer to Interrogatory 7. But when asked what the basis is of Plaintiffs claims for easement rights by implication and/or estoppel, Plaintiffs appear to argue that they have acquired easement rights by “implication and/or estoppel” with respect to Lots 29 and 30 by virtue of the use of other real property (i.e., not Lots 29 and 30) by other Glen Cove residents (i.e., not the Plaintiffs or their predecessors in interest to Lots 29 and 30). See, Plaintiffs Answer to Interrogatory No. 2. 39. Plaintiffs allege that they are the holders of “easement rights by . . . prescription.” Amended Petition at 9. “A person acquires a prescriptive easement by the open, notorious, continuous, exclusive, and adverse use of someone else's land for ten years.” Stallman v. Newman, 9 S.W.3d 243, 248 (Tex. App.—Houston [14th Dist.] 1999, pet. denied). “Burdening another's property with a prescriptive easement is not well-regarded in the law.” Toal v. Smith, 54 S.W.3d 431, 435 (Tex. App.—Waco 2001, pet. denied). While Defendants deny that any predecessor in interest to them owning Lots 29 and 30 had acquired a prescriptive easement for the land occupied by the Boat Dock, as discussed below, any such right was affirmatively extinguished by the Kings. 18 The Kings use of MB Harbour’s land was not “adverse” as they had negotiated to obtain permission to use it. The fact is was not adverse defeats this claims as a matter of law. The Evans have not made use of the Boat Dock for ten years prior to suit being filed, therefore, as a matter of law, Plaintiffs claim to have acquired a prescriptive easement fails. 40. Plaintiffs allege that they have acquired “easement rights by . . . estoppel.” Amended Petition at 9. The doctrine of easement by estoppel “essentially holds that the owner of the alleged servient estate may be estopped to deny the existence of an easement by making representations that have been acted upon by the owner of the alleged dominant estate.” Stallman v. Newman, 9 S.W.3d 243, 246 (Tex. App.—Houston [14th Dist.] 1999, pet. denied). “Three elements are necessary to the creation of an easement by estoppel: 1) a representation communicated, either by word or action, to the promisee; 2) the communication was believed; and 3) the promisee relied on the communication.” Id. “Being a creature of equity, [easement by estoppel] seeks to prevent injustice and to protect innocent parties from fraud.” Id. Here, the facts are precisely the opposite. The Evans were readily aware that the only use of the Boat Dock was as a result of the Canal Use Agreement—well before they purchased the property. They have presented no evidence of any communication by MB Harbour or the Kings that gives rise to the creation of an easement by estoppel. 41. While there are substantial flaws with the Plaintiffs’ claims regarding the Pollard Letter as an easement in their favor, and their assertion that they are the “lawful holders of easement rights by implication, prescription, and/or estoppel,” these flaws do not even need to be reached to resolve this matter, because all of these claims are controlled by the previously recorded Canal Use Agreement. I. The Canal Use Agreement Controls and is binding on the Plaintiffs. 19 42. Evans’ predecessors in interest, the Kings, executed and entered into the Canal Use Agreement with MB Harbour. The Canal Use Agreement created a covenant running with the land that, among other things, acknowledges MB Harbour’s superior rights in its MB Harbour Canal property to that of the owners of Lots 29 and 30. 43. Specifically, the Kings “covenant[ed], “agree[d],” and “grant[ed]” as the “owner in fee of Lots 29 and 30 in Block 4 of the Glen Cove subdivision” that: [They were] desirous of acquiring from [MB Harbour], under the terms and conditions [of the Canal Use Agreement], the use, privilege and license of the portion of the Canal as described and/or depicted on the EXHIBIT "B" attached hereto ("License Area") for the existing residential boat dock and/or pier as depicted on the photograph(s) attached hereto as EXHIBIT "C" ("Existing Improvements") . . . . - Exhibit 14, Canal Use Agreement at 1. ... for and in consideration of the mutual promises herein contained and certain other good and valuable consideration mutually exchanged, the receipt and sufficiency of which is acknowledged, the parties hereto do hereby covenant, agree and grant as follows: - Id. at 1. ... Licensee agrees that [MB Harbour] is the owner of the Canal and that Licensee has no right, title or interest therein whatsoever, except such as is expressly granted in this Agreement. Licensee acknowledges that the presence of the Existing Improvements in the Canal in the absence of this Agreement is a trespass and an encroachment on the property of Licensor. - Id. at 3 (Emphasis added). [T]he license granted herein shall become a covenant running with land and shall attach to [Lots 29 and 30] and in no event whatsoever shall be separated or divisible in any form or manner from the ownership of [Lots 29 and 30]. - Id. at 8 (emphasis added). A. The Canal Use Agreement created a covenant running with the land. 44. Under Texas Law, “a covenant runs with the land when it touches and concerns the 20 land; relates to a thing in existence or specifically binds the parties and their assigns; is intended by the original parties to run with the land; and when the successor to the burden has notice.” Inwood N. Homeowners' Ass'n, Inc. v. Harris, 736 S.W.2d 632, 635 (Tex. 1987). Some courts have further held that there “must also be privity of estate between the parties when the covenant was made.” Ehler v. B.T. Suppenas Ltd., 74 S.W.3d 515, 521 (Tex. App.—Amarillo 2002, pet. denied). All of these elements are present here. 1. The Canal Use Agreement “touches and concerns” the land. 45. “Texas courts have held that covenants running with the land are those affecting the nature, quality, or value of the subject property.” Lennar Homes of Tex. Land & Constr., Ltd. v. Whiteley, 625 S.W.3d 569, 577 (Tex. App.—Houston [14th Dist.] 2021, pet. filed), reh'g denied (Aug. 3, 2021). Here, MB Harbour is burdening its land with the presence of a boat dock that it does not otherwise enjoy the use of. The owners of Lots 29 and 30 are receiving the benefit of the burden, by being able to place the structure on MB Habour’s property, in exchange for the payment of an annual fee. For example, this consideration can be used to maintain the navigability of MB Harbour’s property or for other purposes, but ultimately the owners of Lots 29 and 30 still receive the benefit of MB Harbour’s burdened property, as long as they adhere to all of the terms of the Canal Use Agreement. For example, a “covenant to pay maintenance assessments for the purpose of repairing and improving [] common areas and recreational facilities” has been held to touch and concern the land. Inwood N. Homeowners' Ass'n, Inc. v. Harris, 736 S.W.2d 632, 635 (Tex. 1987); See, also, Supkis v. Madison Place Homeowners' Ass'n., Inc., No. 01-07-00573-CV, 2008 WL 2465788, at *4 (Tex. App.—Houston [1st Dist.] June 19, 2008, pet. denied) (holding that fee- assessment provisions for maintenance of areas that relate to the use and enjoyment of property “touches and concerns the land”). 21 46. Specifically, as recited in the Canal Use Agreement, the Kings were desirous of obtaining from MB Harbour the “use, privilege and license of the portion of” the surface of MB Habour’s property, that is clearly defined in the Canal Use Agreement, to place a boat dock that they could use and enjoy from their property located on Lots 29 and 30. Exhibit 14, Canal Use Agreement at 1. This “touches and concerns” both parties’ land, and affects “the nature, quality, or value of the subject property.” Accordingly, this element is established as a matter of law. 2. The Canal Use License Agreement “relates to a thing in existence.” 47. There is no question that the Canal Use Agreement relates to a boat dock on fixed pilings that sits on the surface of MB Harbour’s Canal property to be used by the owners of Lots 29 and 30. This element is conclusively established as a matter of law. 3. The Canal Use Agreement was “intended by the original parties to run with the land.” 48. As detailed above, the Canal Use Agreement expressly provides: [T]he license granted herein shall become a covenant running with land and shall attach to [Lots 29 and 30] and in no event whatsoever shall be separated or divisible in any form or manner from the ownership of [Lots 29 and 30]. Thus, the original parties intended the agreement to run with the land. Further supporting this reading, that it runs with the land and is not personal to the Kings, is that it was “non- transferable and non-assignable by Licensee except to a subsequent purchaser of” Lots 29 and 30. Exhibit 14 at 8. Once again, this element is conclusively established as a matter of law. 4. The Plaintiffs, as the successors to the burden, had notice of the burden. 49. As discussed above, the Evans purchased Lots 29 and 30 with constructive and actual notice of the Canal Use Agreement. “Under Texas law, constructive notice is notice given 22 by properly recorded instruments and charged to a person as a matter of law, regardless of the person's actual knowledge.” Matter of Hamilton, 125 F.3d 292, 299 (5th Cir. 1997). Indeed, Tex. Prop. Code Ann. § 13.002 provides: “An instrument that is properly recorded in the proper county is: (1) notice to all persons of the existence of the instrument; and (2) subject to inspection by the public.” The Canal Use Agreement was recorded in the Official Real Property Records of Galveston County.9 The Plaintiffs, therefore, had constructive notice of the Canal Use Agreement as a matter of law. The Plaintiffs incorrectly contend that the Canal Use Agreement was not a “recordable real property interest” (a point Defendants address thoroughly below), but irrespective, the Plaintiffs admit they had actual notice of the Canal Use Agreement. 50. David Evans testified during his deposition “there was no doubt that [he] and [his] wife had seen [the] Canal Use License Agreement” before they agreed to the purchase of Lots 29 and 30 from the Kings. Exhibit 15, Deposition Transcript of David Evans at 130:16-21. David Evans further testified that he reviewed the document on behalf of himself and his wife. Id. at 130:25-131:08. 22 Q. And you were paying over half a million 23 dollars for the purchase of this property, correct? 24 A. Correct. 25 Q. So I take it you would have reviewed this 1 license agreement and understood what it says? 2 A I did. - Exhibit 15 at 130:22-131:02. Evans further testified: 9 23 9· Q·And so you knew that there was a Canal Use 10·License Agreement that had been executed by MB Harbour 11·and Claudia King prior to your purchase of the property 12·from the Kings? 13·A.·Correct - Exhibit 15 at 131:9-13 51. Evans also testified that, in January or February of 2020, months before he consummated his purchase of Lots 29 and 30 in August of 2020, he was aware of the Canal Use Agreement and even contacted MB Harbour to discuss it with them. Id. at 134:16-135:16. Moreover, it is indisputable that a copy of the Canal Use Agreement was included and appended to the ONE TO FOUR FAMILY RESIDENTIAL CONTRACT (RESALE) executed by the Kings and the Evans on July 6, 2020, when the Kings sold Lots 29 and 30 to them. It is also indisputable that the Evans initialed the same copy of the Canal Use Agreement as part of the acknowledgments made at the closing on Lots 29 and 30. See, Exhibit 10 at 23-40. See also, Evans testimony, Exhibit 15 at 109:2-4 (Q. . . . . And I take it you had an opportunity to review the sales document, sales agreement, and all the attachments and exhibits to it? A. That is correct.”). There is absolutely no question that Plaintiffs had actual notice of the Canal Use Agreement. Accordingly, Plaintiffs had both actual and constructive notice of the Canal Use Agreement that was a covenant running with the property as a matter of law. 5. There is privity of estate between the original parties to the Canal Use Agreement and the Plaintiffs. 52. When the Canal Use Agreement was entered into by MB Harbour and the Kings, on October 26, 2017, the Kings were the fee simple owners of Lots 29 and 30. MB Harbour was the fee simple owner of its Canal Property. As discussed above, the parties contractually and 24 through Texas real property law entered into an agreement with each other for one party to have the limited use of the other party’s property for the detailed consideration. There is privity of estate between the Kings and the Evans. Privity of estate means there must be a mutual or successive relationship to the same rights of the property. MJR Oil & Gas 2001 LLC v. AriesOne, LP, 558 S.W.3d 692, 700 (Tex. App.—Texarkana 2018, no pet.). 53. The Evans succeeded to the same rights of Lots 29 and 30 when they received a deed conveyance from the Kings. See, In re Chesapeake Energy Corp., 622 B.R. 274, 283 (Bankr. S.D. Tex. 2020) (“An easy example of vertical privity is the transfer of a person's fee estate to another.”) Those rights included the negotiated rights of the covenant of use regarding the Boat Dock as set out in the Canal Use Agreement. 54. For all of these reasons, the Canal Use Agreement is a covenant running with the land as it concerns MB Harbour’s Canal Property and Lots 29 and 30; therefore, the Evans are bound by the Canal Use Agreement as a matter of law. B. Even if the Canal Use Agreement were determined to not be a covenant running with the land, the Plaintiffs are still bound by its terms. 55. On its own terms, the Canal Use Agreement was in force when Lots 29 and 30 were conveyed to the Evans from the Kings on August 12, 2020. The Canal Use Agreement provides for a term of “one (1) year from the date hereof, and shall be renewable by Licensee for consecutive one-year terms by payment by Licensee of the Base Licensee Fee. See, Exhibit 14 at Section 6. License Fee (a). The Kings had complied with the terms of the agreement and it was in force on August 12, 2020. For example: • On or about September 8, 2017, the Kings’ boat dock was inspected by Norex Engineering on behalf of MB Harbour. Exhibit 18, September 8, 2017, Letter from Norex Engineering. • On or about May 17, 2017, the Kings paid the annual assessment fee. 25 Exhibit 19. • On or about September 22, 2017, the Kings submitted a certificate of insurance to MB Harbour. Exhibit 20. • On or about, October 26, 2017, the Kings executed the Canal Use Agreement. Exhibit 14. • On or about October 10, 2018, the Kings paid the Agreement’s annual assessment fee thru October 2019. Exhibit 21. • On or about October 4, 2019, the Kings paid the annual assessment fee thru October 2020. Exhibit 22. 56. Thus, on its own terms the Canal Use Agreement was still in effect as of the date of the Evans’ purchase of and closing on Lots 29 and 30 in August of 2020. As a result, since the Canal Use Agreement was in effect and the Evans had actual and constructive notice of it, they took the property subject to, among other terms, these: