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Click here for the full text of this decision FACTS:On Jan. 29, 2002, Mady Development LP and Roger and Jennifer Sefzik entered into a contract for the sale of 47.6 acres of real property located in Collin County, for $1.5 million. The land conveyed by the Sefziks to Mady under the contract consisted of land taxed under two property tax accounts identified by both parties as the 110 tract and the 130 tract. The Sefziks retained 11 acres of the 110 tract. When the contract was signed, the 110 tract and the 130 tract were receiving an agricultural exemption from the Collin County Appraisal District (CCAD). In May 2002, the CCAD sent notices of appraised value to the Sefziks on the 110 and 130 tracts. The Sefziks appointed Charles McKissick, one of the real estate agents who brokered the sale, as their agent to protest the valuation. In June 2002, the Sefziks, through their agent, reached a settlement with CCAD which reduced the market value of the 110 tract and the 130 tract. The agricultural exemption on the land was maintained. On Sept. 9, 2002, the contract closed and Mady received title. At closing, the Sefziks paid $118.81 in prorated ad valorem taxes and Mady paid $53.27 in prorated ad valorem taxes. On that same day, Mady assigned the contract to MDC-Trinity Heights LP (MDC). In March 2003, the CCAD issued a Notice of Change of Use Determination for the property to both the Sefziks and Mady. According to the notice, CCAD determined there was a change of use of the property as of Dec. 31, 2002, and the property no longer qualified for the agricultural exemption for the 2002 tax year. In September 2003, the Collin County tax assessor sent out tax bills to Mady and the Sefziks for the 2002 tax year assessing taxes on the market value of the 110 tract and the 130 tract. The amounts assessed were $24,364.36 on the 110 tract and $6,629.23 on the 130 tract. On Dec. 16, 2003, Mady sent a demand letter to the Sefziks. Mady demanded the Sefziks pay a pro rata portion of the additional 2002 property taxes, which Mady calculated to be $17,379.09. Pursuant to the tax bills issued by the Collin County Tax Assessor, Mady paid $30,993.58 in property taxes for the 2002 tax year. The Collin County tax assessor subsequently refunded $5,030.80 to Mady for taxes paid on the Sefziks’ 11 acres. On March 2, 2004, Mady sent another demand letter to the Sefziks regarding their pro-rata share of the 2002 property taxes. On April 15, 2004, Mady filed suit for breach of contract and reasonable attorneys’ fees. An amended petition filed on May 2, 2005, added a claim for equitable subrogation based on the amount that was paid by Mady on behalf of the Sefziks. Both parties moved for summary judgment. Following a hearing on the cross-motions, the trial judge entered final judgment on Jan. 6, 2006, allowing Mady to recover the $17,379.09 in property taxes and $1,086.84 for the subrogation claim together with postjudgment interest in the amount of five percent per annum from the date of judgment. The trial court also ordered the Sefziks to pay Mady’s attorneys’ fees. On Feb. 8, 2006, the Sefziks filed a motion for new trial. The trial court denied the motion in a written order dated March 24, 2006. The Sefziks appealed. HOLDING:Affirmed in part, reversed and remanded in part, rendered in part. In their first issue, the Sefziks claimed that Mady was responsible as a matter of law for all of the taxes on the property resulting from the revocation of the agricultural exemption, because the real estate contract between the parties provided that the buyer was responsible for additional taxes caused by the buyer’s change of use. Interpreting the contract at issue and finding it to be unambiguous, the court agreed with the Sefziks’ interpretation of the agreement. Accordingly, the court sustained the Sefziks’ first issue. The court reversed the portion of the trial court’s judgment awarding Mady $17,379.09 for breach of contract and rendered judgment that Mady take nothing on its breach of contract claim. In their fourth issue, the Sefziks argued that Mady was not entitled to recover $1,086.84 in subrogation for the Sefziks’ 11 acres, because Mady received all of the tax refund to which it was entitled. Similarly, in their fifth issue, the Sefziks argued that, as a matter of law, Mady was not entitled to recover under subrogation for any taxes paid on the Sefziks’ 11 acres. But because the Sefziks failed to raise the two arguments in their response to Mady’s motion for summary judgment or in their motion for new trial, the court stated that the Sefniks waived the two points of error. Turning to the question of attorneys’ fees, the Sefziks in their second issue claimed that, if they are entitled to judgment as a matter of law, then the district court improperly refused to award them attorneys’ fees and costs under the contract. The court stated that its disposition of the Sefziks’ first issue substantially reduced, but did not entirely eliminate, the amount of Mady’s recovery. The question remains, the court stated, whether Mady is still a prevailing party under the contract that is entitled to reasonable attorneys’ fees for its subrogation claim. If Mady is not a prevailing party, the court stated, only the Sefziks are entitled to attorneys’ fees and costs. Because that question was not addressed in the trial court, the court reversed the trial court’s award of attorneys’ fees and remanded for reconsideration of the issue. OPINION:Mazzant, J.; Moseley, O’Neill and Mazzant, JJ.

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