Texas Business Court Decision – July 29, 2026
No. 26-BC08-0011 Riverside Homebuilders, Ltd. v. FG Aledo Development (Eighth Division, Judge Stagner) 2026 Tex. Bus. 53 26-bc08b-0011-riverside-homebuilders-v-fg-aledo-development-2026-tex-bus-53.pdf
Contracts/Statute of Frauds.
Background.
FG Aledo owned and was developing roughly 358 residential lots in Morningstar Section 1-1, a Parker County subdivision, with a business plan of selling developed lots to homebuilders rather than building the homes itself. FG Aledo’s ownership was split evenly between KTFW Investments (owned by Kim Gill, Aledo’s sole manager) and Tim Fleet, who also owned and controlled plaintiff Riverside Homebuilders. FG Aledo had already contracted to sell about 179 of the 358 lots to homebuilder D.R. Horton. Riverside claimed it separately struck a deal – the “Morningstar Contract,” dated October 1, 2024 – for the right to purchase the remaining 181 lots. Rather than identifying these lots by block, metes and bounds, or recorded plat, the contract identified only the overarching 71.-964-acre tract and provided that D.R. Horton, as “Other Builder,” would first divide all lots in the subdivision into two groups, after which Riverside would have 15 days to select one group. The contract gave D.R. Horton unfettered discretion over how to divide the lots and expressly acknowledged an “insufficiency of the legal description,” stating the parties would obtain a proper legal description via a Final Plat to be recorded later. No plat existed when the contract was signed; it was recorded roughly four months later. When FG Aledo refused to convey the lots Riverside claimed were allotted to it, Riverside sued for breach of contract and other related claims. FG Aledo moved for traditional summary judgment on multiple grounds, principally that the contract was unenforceable under the statute of frauds.
Issue:
Whether the Morningstar Contract satisfies the statute of frauds’ requirement that a writing for the sale of real property identify the land to be conveyed, or furnish objective means of identifying it, with reasonable certainty at the time the contract is made – given that the specific lots could not be determined until a third party (D.R. Horton) exercised unconstrained discretion to divide the subdivision, and the contract itself acknowledged that the legal description was incomplete. HELD: No.
Discussion:
The Court assumes without deciding that the contract was validly executed and authorized, bypassing the parties’ disputed authentication issues, because the statute-of-frauds defect was independently dispositive. Under Wilson v. Fisher, 188 S.W.2d 150 (Tex. 1945) and Morrow v. Shotwell, 188 S.W.2d 538 (Tex. 1972) and related authorities, a writing must furnish within itself (or by reference to another existing writing) the means to identify the specific land with reasonable certainty; extrinsic evidence may explain an existing term, but it cannot supply a missing one. Selection-type contracts can satisfy the statute, per Stekoll Petroleum Co. v. Hamilton, 255 S.W.2d 187 (Tex. 1953), only where the buyer possesses a truly “unqualified,” self-executing right of selection requiring no further discretionary act by another party.
The Morningstar Contract fails this standard. Riverside’s selection right was contingent entirely on D.R. Horton first dividing the subdivision using no contractually specified formula – the division could have run any one of a number of different ways, yielding entirely different lot sets. Because D.R. Horton never exercised its discretion before the suit, no defined groups existed from which Riverside could choose, rendering the 181 lots not merely unidentified but unknowable at signing. The section of the contract expressly acknowledging that the legal description was insufficient and would later be obtained compounded the defect, confirming the parties’ own recognition that the writing lacked an adequate property description. Texas law does not permit parties to cure such deficiencies through later created plats or documents.
Because every one of Riverside’s contract-based claims depends on an enforceable obligation to convey identifiable real estate, the statute-of-frauds defect was fatal to the entire suit. FG Aledo’s motion for summary is granted as the contract is unenforceable as a matter of law. The court does not reach FG Aledo’s other grounds for summary judgment.