Aracely Enterprises, LLC v. Sesatty Enterprises, LLC

NUMBER 13-24-00058-CV

COURT OF APPEALS

THIRTEENTH DISTRICT OF TEXAS

CORPUS CHRISTI – EDINBURG

ARACELY ENTERPRISES, LLC, Appellant,

v.

SESATTY ENTERPRISES, LLC, Appellee.

ON APPEAL FROM THE COUNTY COURT AT LAW NO. 9
OF HIDALGO COUNTY, TEXAS

MEMORANDUM OPINION

Before Chief Justice Tijerina and Justices West and Fonseca
Memorandum Opinion by Justice West

Appellant Aracely Enterprises, LLC asserts that appellee Sesatty Enterprises, LLC

was not entitled to relief in the underlying forcible detainer proceeding because subject

matter jurisdiction was lacking. The county court denied appellant’s jurisdictional

challenge. We reverse and render.
I. BACKGROUND

This litigation involves a dispute related to possession of a commercial plaza in

McAllen, Texas, that was owned by appellee. The parties agree that, beginning in 2022,

Aracely Gonzalez 1 leased units at the plaza in her individual capacity and on behalf of

Aracely Gonzalez Insurance and Financial Services, LLC, neither of which are parties in

this case. According to appellant’s counsel, these leases specified monthly rent in the

amount of “a thousand bucks or two thousand bucks” each. After entering the foregoing

leases, appellee and appellant entered into a “Real Estate Sale Agreement” (Sales

Agreement) on October 31, 2022, which purports to be a seller financing arrangement

whereby appellee agreed to sell the plaza to appellant for a sum of $1,100,000 with

monthly payments of $11,252.88. 2 The Sales Agreement states the parties will have an

attorney prepare a “[p]romissory note, deed of trust, and warranty deed with vendor’s

lien.”

According to Gonzalez, after execution of the Sales Agreement: (1) she was

introduced to the plaza’s tenants by Lisseth Sesatty3 as the new owner of the plaza;

(2) Sesatty instructed plaza tenants to remit all rental payments to Gonzalez; (3) Gonzalez

made $80,000 in repairs to and remodeling of the plaza; and (4) Gonzalez paid the

insurance and taxes for the plaza. Gonzalez claims that appellee was unable to perform

at closing because appellee does not have clean title to the plaza.

Aracely Gonzalez is the agent of appellant who later signed the subject real estate sales
1

agreement on appellant’s behalf.
2 The monthly payment is listed in print as $11,268 but is crossed out and replaced in handwriting

with $11,252.88.
3 Lisseth Sesatty is the agent of appellee who signed the Sales Agreement on appellee’s behalf.

2
In its brief, appellee agrees that it did not have clean title but avers that appellant

was unable to close anyway because it would have been unable to tender the required

$125,000 down payment at closing. After these developments, appellee offered to return

appellant’s earnest money deposit. 4 But according to appellee, appellant declined the

offer and instead asked appellee to keep the earnest money deposit and allow appellant

to pay $11,800 per month as rent for the plaza. Appellee agreed, and appellant began

making payments that varied, many of which were between $11,200 and $12,000.00.

Appellant claims it ceased making payments at some point because appellee

refused or was unable to close with tender of clean title. Then appellee sent appellant a

notice of eviction which stated that appellee would direct plaza tenants to remit rent

payments directly to appellee. Thereafter, appellee initiated a forcible detainer action in

the justice court seeking possession and $20,000 for five months of back rent. The justice

court granted possession to appellee and awarded it $11,200 in damages. Appellant

appealed to the county court where two hearings were held. The first hearing considered

the issue of possession. There, the parties each argued extensively that each was the

true owner of the plaza. Appellant highlighted the Sales Agreement, the lack of a lease

between the parties, and its control over the plaza. Appellee highlighted that “the deed”

to the plaza bears its name and that appellant failed to remit payments due. Appellee’s

counsel described the Sales Agreement as a seller-financed contract for deed, while

appellant’s counsel described it as a traditional mortgage transaction with a promissory

note, deed of trust, and warranty deed. The county court granted possession to appellee.

4 The parties do not identify the actual amount paid as the earnest money deposit. However, the

Sales Agreement specifies an initial deposit of $25,000.
3
The next day, appellant filed a plea to the jurisdiction asserting the justice court

and county court had no jurisdiction because the matter involved resolution of title issues.

After holding a second hearing, the county court denied the plea, and this appeal followed.

Concurrent with this litigation, the parties are also litigating their title dispute related

to the plaza in the 206th District Court.

II. STANDARD OF REVIEW

Whether a trial court has subject matter jurisdiction is a question of law, which we

review de novo. Hearts Bluff Game Ranch, Inc. v. State, 381 S.W.3d 468, 476 (Tex.

2012). In de novo review, no deference is given to the trial court's decision. See In re Est.

of Slaughter, 305 S.W.3d 804, 808 (Tex. App.—Texarkana 2010, no pet.) (citing Quick v.

City of Austin, 7 S.W.3d 109, 116 (Tex. 1998)). A defendant may challenge jurisdiction by

filing a plea to the jurisdiction. Mission Consol. Indep. Sch. Dist. v. Garcia, 372 S.W.3d

629, 635 (Tex. 2012). The plea may attack both facts as pleaded as well as the existence

of jurisdictional facts. Id.; Flores v. Tex. Dep’t of Crim. Just., 634 S.W.3d 440, 450 (Tex.

App.—El Paso 2021, no pet.). When a plea to the jurisdiction challenges the existence of

jurisdictional facts, the court’s review mirrors that of a summary judgement, and we

consider relevant evidence submitted by the parties. Garcia, 372 S.W.3d at 635.

III. DISCUSSION

Appellant argues by a single issue that the justice court and county court lacked

jurisdiction to grant possession to appellee. 5

5 Appellant also asserts two foundational issues that appellee does not contest on appeal. First,

appellant argues that its jurisdictional challenge does not fail despite being raised in a post judgment plea.
We agree. A litigant may raise challenges to subject matter jurisdiction at any time, even for the first time
on appeal. Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 445 (Tex. 1993); Goss v. City of
4
Appellee argues that the judgment should be affirmed because appellant violated

two statutes that required appellant to deposit rent money in the court registry during this

litigation.

A. Justice Court and County Court Jurisdiction

Appellant argues that a title issue exists depriving the justice court and county court

of jurisdiction in this litigation. We agree.

“For state trial courts of limited jurisdiction, ‘the authority to adjudicate must be

established at the outset of each case, as jurisdiction is never presumed.’” Town of

Anthony v. Lopez, 661 S.W.3d 667, 670 (Tex. App.—El Paso 2023, pet. denied) (citing

Gonzalez v. Wells Fargo Bank, N.A., 441 S.W.3d 709, 712 (Tex. App.—El Paso 2014, no

pet.) (quoting (citing Dubai Petroleum Co. v. Kazi, 12 S.W.3d 71, 75 (Tex. 2000))). Justice

courts are courts of limited jurisdiction and, while they have jurisdiction over forcible

detainer actions, they have no jurisdiction over actions concerning title to land. TEX. GOV’T

CODE ANN. § 27.031(a-b). The county court has no jurisdiction over a forcible detainer

appeal unless the justice court did. Hong Kong Dev., Inc. v. Nguyen, 229 S.W.3d 415,

434 (Tex. App.—Houston [1st Dist.] 2007, no pet.). 6

Houston, 391 S.W.3d 168, 176 (Tex. App.—Houston [1st Dist.] 2012, no pet.). Second, appellant argues
Texas Property Code § 24.007—which divests our appellate jurisdiction to decide “issue[s] of possession”
related to non-residential properties—does not preclude our appellate jurisdiction in this case. See TEX.
PROP. CODE ANN. § 24.007. We agree. Our review of whether a lower court had subject matter jurisdiction
does not involve “issue[s] of possession” under § 24.007. Rice v. Pinney, 51 S.W.3d 705, 707–08 (Tex.
App.—Dallas 2001, no pet.); see also Mattlage-Thurmond v. First Nat’l Bank of McGregor, No. 10-22-
00019-CV, 2022 WL 4546902, at *2 (Tex. App.—Waco Sept. 28, 2022, no pet.) (mem. op.). Therefore,
§ 24.007 does not deprive our appellate jurisdiction.

6 We acknowledge that the county court has general jurisdiction over original proceedings—

including those involving claims to adjudicate title—where the “matter in controversy does not exceed
$750,000.” Ditech Servicing, LLC v. Perez, 669 S.W.3d 188, 193 (Tex. 2023) (citing TEX. GOV'T CODE §
25.1102). However, this case is not an original proceeding in the county court, invoking its general
jurisdiction. Rather, this is an original proceeding in the justice court, specifically a forcible detainer
5
“An action for forcible detainer is a ‘summary, speedy, and inexpensive remedy for

the determination of who is entitled to the possession of premises.’” Yarbrough v.

Household Fin. Corp. III, 455 S.W.3d 277, 280 (Tex. App.—Houston [14th Dist.] 2015, no

pet.) (quoting Scott v. Hewitt, 90 S.W.2d 816 (Tex. 1936)); Ward v. Malone, 115 S.W.3d

267, 270 (Tex. App.—Corpus Christi–Edinburg 2003, pet. denied). A plaintiff in a

forceable detainer action need not prove title but must merely show sufficient evidence to

demonstrate a superior right to immediate possession. Yarto v. Gilliland, 287 S.W.3d 83,

89 (Tex. App.—Corpus Christi–Edinburg 2009, no pet.). This generally requires proof of

a landlord-tenant relationship. Yarbrough, 455 S.W.3d at 280; see also Haywood v. No

Bull Invs., LLC, No. 13-22-00609-CV, 2023 WL 4940543, at *3 (Tex. App.—Corpus

Christi–Edinburg Aug. 3, 2023, no pet.) (mem. op.) (“[W]ithout a landlord-tenant

relationship, a justice court cannot determine the issue of immediate possession without

first determining who has title to the property.” (quoting Goodman-Delaney v. Grantham,

proceeding. And even when forcible detainer proceedings are appealed to a county court with general
jurisdiction, the court’s jurisdiction is confined to that of the justice court’s because allowing otherwise would
“thwart” the “object” of our forcible detainer law: “speedy, summary, and inexpensive determination[s] of
the right to immediate possession.” Nguyen, 229 S.W.3d at 442 (citing Texas–Mexican Railway Co. v.
Cahil, 23 S.W. 232, 232 (Tex.Civ.App.-Galveston 1893, writ ref'd) (holding the county court was unable to
adjudicate the following claims in a forcible detainer appeal: (1) tortious interference with contractual
relations, (2) breach of fiduciary duty, (3) unfair competition, and (4) conspiracy.); Cahil, 23 S.W. at 232
(holding the district court was unable to adjudicate a trespass to try title claim in a forcible detainer appeal);
Salaymeh v. Plaza Centro, LLC, 264 S.W.3d 431, 435 (Tex. App.—Houston [14th Dist.] 2008, no pet.) (“The
appellate jurisdiction of the county court is confined to the jurisdictional limits of the justice court.
Accordingly, notwithstanding the grant of general jurisdiction to a county court, it has no jurisdiction to
adjudicate title to real property in a de novo trial on appeal of a forcible detainer suit from justice court.”);
Rice v. Pinney, 51 S.W.3d 705, 708–09 (Tex. App.—Dallas 2001, no pet.) (same); Garza v. Chavarria, 155
S.W.3d 252, 255 (Tex. App.—El Paso 2004, no pet.) (same); Ward v. Malone, 115 S.W.3d 267, 269 (Tex.
App.—Corpus Christi–Edinburg 2003, pet. denied) (same) Alanis v. Wells Fargo Bank Nat'l Ass'n, 616
S.W.3d 1, 6 (Tex. App.—San Antonio 2020, pet. denied) (“[T]he county court has no jurisdiction over a
forcible-detainer appeal unless the justice court did.”) see also Hands of Healing Residential Treatment
Ctr., Inc. v. Havenar, No. 01-13-01064-CV, 2015 WL 4760211, at *4 (Tex. App.—Houston [1st Dist.] Aug.
13, 2015, no pet.) (“[I]n forcible-detainer actions, justice and county courts lack jurisdiction to adjudicate
claims beyond the right to immediate possession.”) (mem. op.).
6
484 S.W.3d 171, 174 (Tex. App.—Houston [14th Dist.] 2015, no pet.)). Lack of a landlord-

tenant relationship in a forcible detainer suit indicates a title issue is intertwined with the

issue of possession. Yarto, 287 S.W.3d at 89; Yarbrough, 455 S.W.3d at 280. And when

such is the case, the possession issue may not be adjudicated without first determining

title. Lopez, 661 S.W.3d at 671. Under these circumstances, the justice court is deprived

of jurisdiction because the matter no longer involves a mere determination of the right to

immediate possession. Id.

Here, no landlord-tenant relationship has been established between appellee and

appellant. See Ward, 115 S.W.3d at 270–71 (reviewing the record and holding that the

justice and county court did not have jurisdiction over the forceable detainer action

because the record did not show that a landlord-tenant or tenancy-at-sufferance

relationship existed between the parties); Yarto, 287 S.W.3d at 89–90 (finding landlord-

tenant relationship was unestablished where parties disputed their relationship, and there

was no written lease in the record). No lease between the parties appears in the record. 7

In its brief, appellee states it submitted lease agreements to the county court, and it

provided citations to the clerk’s record. But the citations merely lead to checks from

appellant returned for insufficient funds and eviction notice letters that appellee sent to

appellant. Our review of the record reveals that appellee never attached a lease to its

filings or submitted one as evidence in the justice court or the county court. The only

evidence purportedly memorializing the relationship between appellant and appellee is

7 As noted, it is undisputed that Gonzalez leased units at the plaza in her individual capacity and

on behalf of Aracely Gonzalez Insurance and Financial Services, LLC; however, those entities are not
parties to the underlying suit or this appeal.
7
the Sales Agreement. Such agreement not only fails to definitively prove a landlord-tenant

relationship, but tends to disprove that there was a landlord-tenant relationship. See

Ward, 115 S.W.3d at 271 (“The legal effect of the contract [for deed] is the same as that

of a deed with a retained vendor’s lien.”).

Further, the parties’ actions contradict a landlord-tenant relationship. Appellant

remitted an earnest money deposit to appellee as required by the Sales Agreement.

Then, appellant accepted rent payments directly from the plaza tenants, paid the

insurance and property taxes, and made improvements to the facility. Further, appellee

sought from appellant monthly payments of over $11,000—an amount far in excess of

the rent owed under the two lease agreements with the nonparties and instead more

similar to the sum specified by the Sales Agreement, $11,252.88.

Still more, the reporter’s record reflects that the county court explicitly evaluated

title matters. First, the county court acknowledged that it cannot decide title issues and

that the present case involved title issues:

[B]oth of you seem to agree that the District Court is the one that decides
title . . . . So if you all are here today to decide if I can decide title, well
obviously, I’m not going to decide title . . . . This is a matter of, you have a
complicated situation here with respect to who really owns this plaza . . . .
So now the bottom line is now you-all have this whole title issue . . . .

But the county court then rationalized that it must find in appellee’s favor as follows:

I’m not saying that [counsel for appellant doesn’t] have an equitable
argument for [her] client to become owner. You-all definitely have a title
dispute here, but at this point . . . [b]ecause the only warranty deed that’s
on file is the one that has Ms. Sesatty’s name. Whether I agree with it or
not, my hands are tied . . . .

8
The county court agreed with appellant’s argument that this case “should have been a

foreclosure.” The county court declined to hear from appellant’s witnesses, finding such

testimony was best suited for the district court lawsuit where title was being adjudicated.

But, nevertheless, the county court made the following finding of ownership: “It’s

unfortunate, [counsel for appellant]. [Appellee] is the owner at the end of the day.”

Given the foregoing, it is clear the county court decided title issues, despite its

apparent recognition that such decisions were beyond its jurisdiction. The county court

determined that appellee was the “owner” because a single deed 8 that was “on file”

purported to convey the plaza to appellee. However, we held in Yarto that the justice court

lacked jurisdiction to grant possession based upon a warranty deed favoring plaintiff

where there was evidence that defendant had an equitable title claim, specifically an oral

contract for deed, because such involved deciding issues of title. 287 S.W.3d at 90. The

reasoning behind our holding is instructive: a deed on its face provides no assurance that

its grantee is the actual current title holder because (i) title may transfer outside written

conveyances, see id. (finding a contract for deed was evidence of an equitable interest in

subject property); Ward, 115 S.W.3d at 271 (“The legal effect of a contract [for deed] is

the same as that of a deed with a retained vendor’s lien.”); see also TEX. CIV. PRAC. &

REM. CODE ANN. § 16.030 (title through adverse possession), and (ii) conveyances need

not be recorded to be effective as our real property recording system merely serves as a

vehicle for providing notice to third parties. See TEX. PROP. CODE ANN. § 13.002; Burris v.

McDougald, 832 S.W.2d 707, 709 (Tex. App.—Corpus Christi–Edinburg 1992, no writ);

8 This deed, while considered by the county court, was not admitted into evidence and is not in the

record on appeal.
9
see also Sanchez v. Montalvo, No. 13-19-00121-CV, 2021 WL 1799829, at *6 (Tex.

App.—Corpus Christi–Edinburg May 6, 2021, pet. denied) (mem. op., not designated for

publication). Thus, in a forcible detainer proceeding where a landlord-tenant relationship

is disputed or unproven and the trial court grants possession by favoring a deed (recorded

or unrecorded) presented by plaintiff over evidence of defendant’s equitable title interest,

the trial court is no longer merely deciding possession issues but also title issues. See

Yarto, 287 S.W.3d at 89. In such cases, the justice court and county court are deprived

of jurisdiction. See id.; Lopez, 661 S.W.3d at 671. The title issue must first be resolved by

the district court. See Yarbrough, 455 S.W.3d at 280.

Appellee counterargues that our decision in Gomez v. Esquivel supports

jurisdiction in this case. No. 13-19-00037-CV, 2020 WL 1303233, at *1 (Tex. App.—

Corpus Christi–Edinburg Mar. 19, 2020, no pet.) (mem. op.). Like the present case, the

parties in Gomez entered a real estate sales contract. Id. But sometime afterward, the

parties entered a renewed lease agreement. Id. Additionally, the Gomez plaintiff never

operated as if title was transferred by, for example, keeping earnest money deposits,

collecting sums resembling those specified by a real estate sales contract instead of a

lease, or allowing defendant to manage and control the premises as a true title holder. Id.

Instead, the Gomez defendant merely failed to tender the purchase price at closing. Id.

Then, he began defaulting on rental payments owed under the renewed lease agreement.

Id. Thereafter, plaintiff initiated a forcible detainer proceeding. Id. The foregoing

demonstrates the issue of immediate possession in Gomez was independent from the

title issues. Id. at *4. However, the facts of the present case are obviously different as

10
analyzed above and command a different result. Thus, we reject appellee’s

counterargument.

Given the lack of a landlord-tenant relationship, the Sales Agreement, the conduct

of the parties, and the county court’s evaluation of title matters, we sustain appellant’s

issue.

B. Compliance with Rule and Statute

Appellee further argues that the county court judgment should be affirmed because

appellant violated Texas Rule of Civil Procedure 510.9(b) and Texas Property Code §

24.0054 by failing to deposit rental payments with the court registry during the pendency

of this litigation. See TEX. R. CIV. P. 510.9(b); TEX. PROP. CODE ANN. § 24.0054.

Appellee’s arguments fail because the justice court and county court lacked subject

matter jurisdiction, and when a “trial court lacks subject matter jurisdiction, the appellate

court can make no order other than reversing the judgment of the court below and

dismissing the cause.” Diocese of Lubbock v. Guerrero, 624 S.W.3d 563, 564 (Tex.

2021). Thus, we reject appellee’s argument.

IV. CONCLUSION

For the foregoing reasons, we reverse the judgment of the county court and render

judgment dismissing the case for lack of jurisdiction.

JON WEST
Justice

Delivered and filed on the
31st day of July, 2025.

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