TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
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NO. 03-01-00356-CV
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Emma P. Polk and S. G. Billings Real Estate/Linda St. Angelo, Appellants
v.
Linda St. Angelo/Emma P. Polk and S. G. Billings Real Estate, Appellees
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FROM THE DISTRICT COURT OF TRAVIS COUNTY, 53RD JUDICIAL DISTRICT
NO. 98-01194, HONORABLE PAUL DAVIS, JUDGE PRESIDING
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Linda St. Angelo (ASt. Angelo@) prevailed on claims of negligence and negligent
misrepresentation regarding her purchase of a condominium against Emma P. Polk (APolk@), the seller=s real
estate agent, and S.G. Billings Real Estate (ABillings@), Polk=s employer. Because the value of settlements
St. Angelo made with other parties exceeded the jury=s actual award, the trial court ordered that, as to
actual damages, St. Angelo take nothing. However, the trial court awarded attorney=s fees against Polk and
Billings based on the earnest money contract. Polk and Billings challenge the trial court=s decision on the
grounds that no basis existed for awarding attorney=s fees because the contract was not binding upon them
as the brokers to the transaction. St. Angelo files a cross-appeal challenging the take-nothing judgment and
attacking portions of the jury verdict. We will affirm the trial court=s judgment.
BACKGROUND
This dispute arises from the calculation of damages and attorney=s fees in a suit brought by
the appellee, St. Angelo, regarding her purchase of a condominium with a leaking roof. The appellants are
the seller=s real estate broker in that transaction, Polk, and her employer, Billings. The other parties, the
seller and homeowners= association, settled before trial.
The seller had owned the condominium since 1994. The roof leaked severely several times,
once forcing the seller to move out so that the homeowners= association could install a new roof. Each time,
the homeowners= association repaired the structure and the leaks appeared to stop.
At the end of 1995, Polk was retained to represent the seller in putting the condominium on
the market. Together, Polk and the seller filled out and signed a disclosure form stating that the
condominium had previously leaked but had undergone structural repairs. They represented on the form
that the repairs had been successful. By March of 1996, however, the two discovered a new leak, which
was allegedly fixed by the homeowners= association. Polk and the seller continued to market the
condominium without amending the disclosure form.
St. Angelo bought the property in September 1996, relying in part on the disclosure form.
All persons involved, including the buyer and seller and their respective brokers, signed an earnest money
contract which specified the parties= reciprocal obligations and provided attorney=s fees for any suit related
to the contract. St. Angelo moved in during October 1996, and the roof began to leak almost immediately.
After six months, during which time the homeowners= association had already begun installing a new roof,
the leaks became so severe that St. Angelo moved out.
St. Angelo then sued the seller, Polk and Billings, and the homeowners= association,
alleging, among other things, violation of the Deceptive Trade Practice Act, Tex. Bus. & Com. Code Ann. '
17.46 (West Supp 2002) (ADTPA@), common law fraud, negligent misrepresentation, and negligence. Only
the claims against Polk and Billings went to trial. The jury found Polk and Billings jointly liable, and
comparatively responsible with the seller, for negligent misrepresentation and negligence. St. Angelo did not
prevail under the DTPA or her other causes of action. Because the jury found no difference between the
value of the condominium as promised and as delivered, the trial court limited damages to St. Angelo=s
pecuniary losses. The jury found that Polk=s share of proportionate responsibility made her liable for
$36,000 in actual damages.
Because St. Angelo had settled with the seller and the homeowners= association before trial,
she had already received two cash settlements and various non-cash benefits. Polk and Billings moved to
have the settlement amounts credited on a dollar-for-dollar basis. The trial court found the jury=s award
was less than the value of the two settlements and ordered that St. Angelo take nothing by way of actual
damages from these defendants. Nevertheless, the trial court awarded $130,601.25 in attorney=s fees and
costs against Polk and Billings based on the earnest money contract. Polk and Billings appeal the award of
attorney=s fees and the trial court=s determination that attorney=s fees were segregated for the purpose of
calculating the settlement credits. St. Angelo, on cross-appeal, challenges the calculation of settlement
credits leading to the take-nothing judgment regarding monetary damages and the jury=s failure to find in her
favor on her DTPA claim and on the measure of actual damages. St. Angelo also questions the wording of
the trial court=s final judgment.
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DISCUSSION
Polk and Billings contend that the trial court had no basis on which to award
attorney=s fees to St. Angelo. They argue that attorney=s fees could not be awarded because: (1)
negligent misrepresentation and negligence are common law torts; (2) St. Angelo did not prevail on
her DTPA claim; and (3) neither Polk nor Billings was a party to the contract. We agree with the
first two contentions. Attorney=s fees are not generally available for tort recovery. Travelers Indem.
Co. of Conn. v. Mayfield, 923 S.W.2d 590, 593 (Tex. 1996) (holding that attorney=s fees for tort
actions must be provided for by statute or by contract). St. Angelo did not prevail on her DTPA
claim and cannot claim statutory attorney=s fees under the DTPA. See Tex. Bus. & Com. Code
Ann. ' 17.50(d) (West Supp. 2002) (awarding attorney=s fees and costs to each consumer who
prevails on DTPA claim).
If attorney=s fees are available, they must be based on the earnest money contract.
When a contract term is unambiguous, we determine the parties= intent from the plain language of
the contract. Receiver for Citizen=s Nat=l Assurance Co. v. Hatley, 852 S.W.2d 68, 78 (Tex.
App.CAustin 1993, no writ). The contract in question is a form contract, promulgated by the Texas
Real Estate Commission and designed to facilitate uniform transactions and application. It is signed
by the buyer and seller of a piece of real estate, as parties, and by the brokers involved in the
transaction. The buyer=s and seller=s signatures indicate their obligations regarding the sale of the
property; the brokers= signatures indicate their intent to split the commission. While most of the
contract sets forth the reciprocal obligations of only the buyer and seller, paragraph 16 specifically
references the brokers involved in the sale. Paragraph 16 reads as follows:
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ATTORNEY=S FEES: If Buyer, Seller, Listing Broker, Other Broker or Escrow agent is
a prevailing party in any legal proceeding brought under or with relation to this
contract, such party shall be entitled to recover from the non-prevailing party all costs
of such proceeding and reasonable attorney=s fees. The provisions of this paragraph
shall survive closing.
Although the contract does not define Aparties@ to include brokers, paragraph 16 specifically
references the brokers. Polk, as an employee of Billings, signed the contract. While Polk and Billings
are not parties to the underlying reciprocal obligations between buyer and seller, they are still
responsible for any liability specifically imposed on them by the terms of the contract.
The contract expressly allows for the recovery of attorney=s fees by a prevailing party,
whether it be a buyer, seller, listing broker, other broker or escrow agent from a non-prevailing party
for suits arising under or related to the contract. The contract does not limit recovery of attorney=s fees
to breach of contract claims between the buyer and seller. See Watkins v. Williamson, 869 S.W.2d
383, 386-87 (Tex. App.CDallas 1993, no writ) (holding that almost identical contract language
entitled any escrow agent, even one who had not signed contract, to attorney=s fees if he prevails on
any claim related to contract). We note that the negligent misrepresentation and negligence claims
were both directly related to the disclosure statement signed by Polk and the seller. Under paragraph
7 of the contract, St. Angelo retained the right to rescind the sale if Polk and the seller failed to
produce a disclosure statement within five days of signing the contract. Any misrepresentation or
negligence relating to Polk=s signature on the disclosure form was related to the earnest money
contract because the implementation of the contract was contingent on the disclosure form. See
Dickerson v. Trinity-Western Title Co., 985 S.W.2d 687, 692-93 (Tex. App.CFort Worth 1999, pet.
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denied) (holding that identical contract language entitled parties to attorney=s fees because claim for
negligence, misrepresentation, and deceptive trade practices was Arelated to@ contract itself). We hold
that, under paragraph 7 of the contract, both negligent misrepresentation and negligence regarding
the disclosure form were Arelated to@ the contract and, therefore, were valid grounds for awarding
attorney=s fees under paragraph 16. Polk=s and Billings=s claim that no basis existed for awarding
attorney=s fees is overruled.
Polk and Billings then argue that, even if attorney=s fees are appropriate, the trial court
inappropriately awarded attorney=s fees and costs because St. Angelo was not a prevailing party.1 To
be a Aprevailing party@ for the purposes of a contractual fee-shifting agreement, St. Angelo must show
that she has succeeded on the merits. Weng Enters., Inc. v. Embassy World Travel, Inc., 837 S.W.2d
217, 222-23 (Tex. App.CHouston [1st Dist.] 1992, no writ). A Aprevailing party@ successfully
prosecutes a claim or defense, prevailing on the main issue even if not to the extent of the original
complaint. See City of Amarillo v. Glick, 991 S.W.2d 14, 17 (Tex. App.CAmarillo 1997, no pet.).
More generally, a prevailing party is one who is vindicated by the trial court=s judgment. Dear v. City
1
Although St. Angelo prevailed on two claims, she recovered no monetary damages after the
application of the settlement credits for the two pre-verdict settlements. Most fee-shifting statutes
relating to tort liability require that a plaintiff recover some monetary damages to be considered
eligible for attorney=s fees. See, e.g., Allstate Ins. Co. v. Bonner, 51 S.W.3d 289, 292 (Tex. 2001)
(holding that plaintiff was not entitled to attorney=s fees under insurance code when insurer had
already paid more to plaintiff in benefits than jury had awarded in damages); Southwestern Bell Mobile
Sys., Inc. v. Franco, 971 S.W.2d 52, 56 (Tex. 1998) (disallowing attorney=s fees on claim for damages
that result in no recovery, but allowing them when equitable relief is granted); State Farm Life Ins. Co.
v. Beaston, 907 S.W.2d 430, 437 (Tex. 1995) (explaining that section 38.001 of the civil practice and
remedies code requires a party recovering damages to be entitled to attorney=s fees). However, St.
Angelo=s claims are based on a contract, not a fee-shifting statute.
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of Irving, 902 S.W.2d 731, 739 (Tex. App.CAustin 1995, writ denied). In such situations, the trial
court has discretion as to the amount of attorney=s fees to be awarded. E.g., Watkins, 869 S.W.2d at
386. Absent an indication that the trial court acted arbitrarily, unreasonably, or without reference to
guiding principles, we will not reverse its decision. Downer v. Aquamarine Operators, Inc., 701 S.W.2d
238, 241-42 (Tex. 1985).
The jury found for St. Angelo on her negligent misrepresentation and negligence
claims. Because Polk and Billings were non-prevailing parties on those claims, the trial court had
discretion under the terms of the contract to award attorney=s fees against them. We overrule Polk=s
and Billings=s complaint that St. Angelo was not a prevailing party for the purposes of awarding
attorney=s fees.
Finally, Polk and Billings argue that St. Angelo=s attorney did not adequately segregate
attorney=s fees between settling and non-settling defendants. Polk and Billings contend that, if the fees are
not properly segregated, they will be forced to pay attorney=s fees and costs for which they are not
responsible. See Stewart Title Guar. Co. v. Sterling, 822 S.W.2d 1, 11-12 (Tex. 1991). The proper
remedy for a failure to segregate fees is a remand to the trial court. Id. at 12.
St. Angelo=s attorney testified at trial as to the amount of attorney=s fees that had been
billed for the prosecution of St. Angelo=s case. During this testimony, St. Angelo introduced a multi-
page billing record as an exhibit. This record consisted of the billing history for the case dating back
approximately three years. St. Angelo=s attorney testified that the Atotal cost of preparation and trial
of this case@ was approximately $118,000 for nearly 880 hours of work. She further testified that this
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figure accounted for paralegals= and attorneys= services and did not include expenses for depositions
and similar expenditures. On cross examination, she conceded that the attorney=s fees could not be
segregated according to the causes of action pleaded. She also conceded that there was an error in the
billing record that she would correct. Subsequently, she testified that the error had been corrected
and that the correct amount of attorney=s fees for St. Angelo=s case was $118,021.25. She also
testified that, in addition to those fees, she had been able to segregate the attorney=s fees exclusively
attributable to the two settling defendants. The attorney=s fees attributable to the homeowners=
association were approximately $10,000 and those attributable to the seller were approximately
$9,000. These attorney=s fees were over and above the $118,000 that she had previously testified as
being attributable to the preparation and trial of the case against Polk and Billings. The trial court
found that the fees had been segregated as to settling and non-settling defendants, and submitted a
question on attorney=s fees to the jury. The jury awarded St. Angelo attorney=s fees in the amount of
$118,021 for preparation and trial of this lawsuit.
In appealing this finding, Polk and Billings challenge the trial court=s determination
that the fees were adequately segregated. Computation of settlement credits to be offset against a jury
verdict is a matter for the trial court, not the jury. Tex. Civ. Prac. & Rem. Code Ann. ' 33.012(b)
(West 1997) (AIf the claimant has settled with one or more persons, the court shall further reduce the
amount of damages to be recovered@) (emphasis added). The trial court, in its discretion regarding
the allocation of settlement credits, accepted the statement made by St. Angelo=s attorney that the
billing statement comprised only the attorney=s fees chargeable to Polk and Billings. We have
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examined the record and have found nothing that would permit us to overturn the trial court=s factual
determination on this issue. Polk=s and Billings=s issue on segregation of attorney=s fees is overruled.
CROSS-APPEAL
St. Angelo contends that the trial court incorrectly rendered a take-nothing judgment on
actual damages because the settlement credits were incorrectly calculated. The jury awarded $36,000. On
Polk=s and Billings=s motion, the court applied a dollar-for-dollar settlement credit. St. Angelo=s settlements
with the seller and the homeowners= association were together worth $55,567.69.2 Because the value of
the settlements exceeded the actual damages as found by the jury, the trial court rendered a take-nothing
judgment as to monetary damages.
2
St. Angelo settled with the seller for a cash payment of $27,500 and with the homeowners=
association for a cash payment of $17,000. In addition, the settlement with the homeowners= association
included a release from $9,953.69 in homeowners= fees, special assessments, late fees and other legitimate
fees assessed against St. Angelo=s unit, and $1,114.00 in attorney=s fees and costs related to the foreclosure
of St. Angelo=s unit. Calculation of settlement credits under the proportionate responsibility statute includes
all settlements, both cash and non-cash. Sisters of Charity of the Incarnate Word v. Dunsmoor, 832
S.W.2d 112, 117 (Tex. App.CAustin 1992, writ denied) (construing Tex. Civ. Prac. & Rem. Code Ann. '
33.012(b)(1) (West 1997)). Together, the value of the settlement agreements, cash and non-cash, totals
$55,567.69.
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St. Angelo=s only complaint is that the trial court did not reduce the settlement credits by the
amount of attorney=s fees attributed to each settlement. St. Angelo would have the trial court subtract the
attorney=s fees included in the settlements, $10,031.84 for the homeowners= association and $8,896.16 for
the seller, from the amount of the settlement credit. This would, according to St. Angelo, reduce the offset
to the point that she would be entitled to money damages. However, nothing in the record supports this
contention. Even if, arguendo, one subtracts the segregated attorney=s fees from the value of settlement
agreements, the net value of the settlement agreements is still greater than the actual damages. The trial
court=s rendition of a take-nothing judgment was proper. We overrule St. Angelo=s issue on the calculation
of the settlement credits.
St. Angelo contests the legal sufficiency of the jury=s failure to make a finding on her DTPA
and statutory fraud claims. To prove the jury=s failure to make a finding is legally insufficient, St. Angelo
must demonstrate that her DTPA and statutory fraud claims were established, based on the evidence in the
record, as a matter of law. See Sterner v. Marathon Oil Co., 767 S.W.2d 686, 690 (Tex. 1989).
Essentially, a party must demonstrate that the record was so clear that no rational jury could have failed to
find in her favor. See id. This is an extremely difficult burden. St. Angelo argues that, because Polk and
Billings did not controvert or rebut some evidence favorable to her case, that evidence necessarily
established St. Angelo=s legal position. We have carefully reviewed the record, and, although some of St.
Angelo=s evidence might permit a jury to find a DTPA violation or statutory fraud, it is not so conclusive as
to allow this Court to determine that issue as a matter of law. St. Angelo=s legal sufficiency point is
overruled.
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St. Angelo also contests the factual sufficiency of some of the jury=s findings on actual
damages. To prevail on a factual sufficiency claim, St. Angelo must demonstrate that the jury=s conclusion is
so weakly based on the record or contrary to the overwhelming weight of the evidence as to be clearly
wrong and unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986). We will not substitute our judgment
for that of the trier of fact merely because we would reach a different conclusion assessing the same record.
Westech Eng=g, Inc. v. Clearwater Constructors, Inc., 835 S.W.2d 190, 196 (Tex. App.CAustin
1992, no writ). St. Angelo argues that the jury failed to award damages based on evidence which was not
rebutted or questioned by Polk and Billings. For example, St. Angelo complains that the jury did not award
her the cost of finding a rental replacement for the condominium while St. Angelo was living with her mother.
However, the jury, as finder of fact, has discretion to weigh the credibility of each piece of evidence.
Herbert v. Herbert, 754 S.W.2d 141, 142 (Tex. 1988). There is no obligation to take a plaintiff=s claims
about the measurement of damages at face value. We overrule St. Angelo=s factual sufficiency issue.
Because St. Angelo is not entitled to recover actual damages, we also overrule her request for pre-judgment
interest.
Finally, St. Angelo asserts that the final judgment is incorrect because it inconsistently refers
to Sam Billings as AS.G. Billings Real Estate@ and ASam Billings, individually and d/b/a S.G. Billings Real
Estate.@ The evidence was undisputed that Polk acted at all times as an employee of S.G. Billings Real
Estate. The fact that the judgment refers to S.G. Billings at some times and to his d/b/a identity at other
times has no legal effect on a judgment and does not affect his underlying liability. See, e.g., A to Z Rental
Ctr. v. Burris, 714 S.W.2d 433, 436 (Tex. App.CAustin 1986, writ ref=d n.r.e.) (holding that individuals
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doing business as an unincorporated entity are liable for the entity=s obligations). The rules of civil
procedure give the trial court discretion to substitute an individual=s name for that of an assumed business
name, but do not require it. See Tex. R. Civ. P. 28 (Athe individual=s true name may be substituted@)
(emphasis added). We will not intrude on the trial court=s ability to draft its final judgment. St. Angelo=s
issue regarding the text of the trial court=s judgment is overruled.
CONCLUSION
We find that the attorney=s fees clause of the earnest money contract required Polk
and Billings to pay attorney=s fees to the prevailing party in any suit related to the contract. Because
negligent misrepresentation and negligence claims were related to the contract and St. Angelo
prevailed on those claims, attorney=s fees were appropriate even though St. Angelo recovered no
monetary damages. We reject Polk=s and Billings=s contention that attorney=s fees were not
adequately segregated. We also reject St. Angelo=s cross-appeal regarding the legal and factual
sufficiency of the jury=s findings, the calculation of the settlement credits, and the wording of the trial
court=s final judgment. The trial court=s judgment is affirmed.
Mack Kidd, Justice
Before Chief Justice Aboussie, Justices Kidd and Yeakel
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Affirmed
Filed: May 31, 2002
Do Not Publish
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