Unreported / Non-Citable
Background
Pro Health, LLC owned an aircraft and engaged Elite Jet Solutions, LLC as an exclusive broker to sell it under an Aircraft Brokerage Listing Agreement. The agreement required Pro Health to pay a $75,000 commission if the aircraft was sold by the broker during the listing period, which ended October 20, 2019. On October 17, 2019, Pro Health entered into a Purchase Agreement with a third party (whom Pro Health’s owner had contacted before the listing period ended). The closing occurred on October 25, 2019—five days after the listing period terminated—at which point title transferred to the purchaser. When Pro Health did not pay the commission, Elite Jet sued for breach of contract. The trial court granted summary judgment in Elite Jet’s favor, concluding a sale occurred when the Purchase Agreement was signed. Pro Health appealed.
This was Pro Health’s second appeal. In the first appeal, this court reversed the trial court’s grant of summary judgment on a different provision (the 90-day clause), finding the court had improperly added commas that changed the provision’s meaning. On remand, the trial court granted summary judgment a second time, this time based on provisions requiring payment if the sale occurred “during the listing period.”
The Court’s Holding
The court reversed the trial court’s second summary judgment, holding that Elite Jet failed to conclusively establish it was entitled to the commission. The court’s primary holding concerned the meaning of “sale.” Under Texas law and the Uniform Commercial Code (Tex. Bus. & Com. Code § 2.106(a)), a “sale” means “the passing of title from the seller to the buyer for a price.” The court rejected Elite Jet’s argument that a sale occurred when Pro Health and the purchaser signed the Purchase Agreement. Instead, applying the plain meaning of the listing agreement and the statutory definition, the court held that the sale was completed only when title transferred at closing on October 25, 2019—after the listing period expired.
The court emphasized that it would not add words to the contract to support Elite Jet’s interpretation, particularly after having reversed the trial court once for adding dispositive punctuation. The court noted that Elite Jet’s interpretation would require reading words into Paragraph 3 that were not there. Additionally, the court held that even if the trial court had relied on the argument that Pro Health intentionally delayed closing, the evidence did not conclusively establish delay or breach. The contract set no specific closing deadline, so Pro Health was entitled to a reasonable time, and closing eight days after the Purchase Agreement was signed arguably satisfied that standard.
Key Takeaways
- A “sale” in commercial contracts means the transfer of title, not the execution of a purchase agreement, unless the parties expressly state otherwise or use the term “present sale” to indicate title passes simultaneously with contract formation.
- Courts may not rewrite contracts to achieve what they view as a more equitable result; contract language must be interpreted according to its plain meaning without additions.
- When a contract does not specify a deadline for performance, the law implies a reasonable time based on the circumstances, which is ordinarily a question of fact precluding summary judgment.
- Summary judgment requires the moving party to conclusively establish entitlement to judgment as a matter of law; disputed facts about the nature and timing of performance prevent summary disposition.
Why It Matters
This decision reinforces that Texas courts adhere to the statutory definition of “sale” as requiring title transfer. It clarifies that brokers cannot claim commissions based on preliminary purchase agreements that do not result in closing and title transfer within the specified period. The decision also demonstrates that courts will not allow drafting ambiguities or technical arguments to override the plain language and statutory definitions of key contract terms—even when one party claims delay was intentional.
For commercial practitioners, the case emphasizes the importance of specifying in listing agreements whether “sale” means signing a purchase agreement or closing with title transfer. It also shows that vague timing provisions for performance (like closing deadlines) may be interpreted against the drafter and will typically create factual disputes unsuitable for summary judgment. The court’s refusal to add language to the contract, after reversing the trial court once for adding punctuation, signals a strict approach to contract interpretation that favors the text as written.