COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-10-00115-CV
GARDNER ALDRICH, LLP APPELLANT
V.
MICHAEL ROBERT TEDDER APPELLEE
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FROM THE 325TH DISTRICT COURT OF TARRANT COUNTY
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MEMORANDUM OPINION1
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Appellant Gardner Aldrich, LLP (the law firm) appeals the trial court’s
judgment on the law firm’s suit on sworn account. The law firm intervened in the
divorce and suit affecting the parent-child relationship (SAPCR) of its former
client, Stacy Lee Tedder, and her estranged husband, Appellee Michael Robert
Tedder. In the divorce decree, the trial court awarded the law firm a judgment on
its suit on sworn account solely against Stacy for $151,747.28 in damages,
1
See Tex. R. App. P. 47.4.
together with postjudgment interest and conditional posttrial fee awards (all
amounts collectively ―client fee award‖). In four issues, the law firm contends (1)
that the trial court erred and abused its discretion by not expanding the client fee
award to hold not only Stacy liable but also hold her husband Michael jointly and
severally liable; (2) that the evidence is legally and factually insufficient to support
the trial court’s failure to grant the law firm a judgment that Michael is jointly and
severally liable for the client fee award; (3) that the trial court erred and abused
its discretion by granting a final judgment inconsistent with the judgment
rendered in open court on August 27, 2009; and (4) that the evidence is legally
and factually insufficient to support the trial court’s failure to grant the law firm a
final judgment consistent with the judgment rendered in open court on August 27,
2009. Within the law firm’s discussion of the issues on appeal is the complaint
that the client fee award should be expanded to include an award of reasonable
attorney’s fees incurred in pursuing the intervention at trial. Because we hold
that the trial court erred by (1) not including in the client fee award reasonable
and necessary attorney’s fees that the law firm expended in bringing its
intervention below and (2) extinguishing the law firm’s right to collect the client
fee award from Michael jointly and severally, we reverse the trial court’s
judgment as to the client fee award, render judgment that Michael and Stacy are
jointly and severally liable for the client fee award, and remand this case for a
new trial solely on the issue of the proper amount of reasonable and necessary
trial attorney’s fees that should be added to the client fee award.
2
I. Statement of Facts
The law firm represented Stacy from October 15, 2007, a week before
Michael filed the original petition for divorce, through a June 2009 jury trial on
conservatorship. After a jury decided that Stacy and Michael should be joint
managing conservators (JMCs) and that Stacy should have the exclusive right to
determine the children’s primary residence within the Arlington Independent
School District, the law firm withdrew from representation of Stacy and filed a
petition for intervention, serving the petition on Michael, Stacy, and the children
through their respective lawyers with the lawyers’ consent. The petition includes
claims of breach of contract and quantum meruit and a suit on sworn account.
The petition asserts that Stacy had executed and then breached a written
employment contract, that the law firm had provided services to Stacy for which it
had not been paid, and that in providing legal services to Stacy, the law firm had
incurred expenses on an open account. In its prayer, the law firm asked for
judgment against Stacy and Michael jointly and severally. No one filed a sworn
denial.
At the hearing on the law firm’s petition for intervention, the law firm argued
that neither Michael nor Stacy had filed a sworn denial and that therefore the law
firm was entitled to judgment as a matter of law. The trial court stated that it
―w[ould] enter a judgment on the pleadings based on the sworn account in the
amount of $151,747.28.‖ Robert Aldrich (―Aldrich‖) then testified about his
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experience and attorney’s fees in bringing the intervention suit and appellate fees
regarding the intervention.
On cross-examination by Stacy’s new attorney, Aldrich testified that he
believed that $50,000 of the $87,500 or amount close to that which had already
been paid to the law firm for representing Stacy in the divorce had been from the
community funds under Michael’s control. Michael’s counsel successfully
objected to a question from Stacy’s attorney inquiring why the fees in the divorce
case had reached such a high amount. Part of the answer is revealed in a letter
ruling issued a day after Stacy’s new counsel appeared in the case. In the letter
ruling, the trial court required that a parenting coordinator be appointed ―to
facilitate the parties’ co-parenting of the children and to lessen the high conflict
between the parties regarding issues affecting the parties and the children.‖
[Emphasis added.] The trial court left in place orders that Michael pay Stacy
$1,200 per month in child support. Later that month, the trial court signed
modified temporary orders that required Michael to pay spousal support of
$1,000 (formerly $3,000 per month) during the pendency of divorce.
On September 22, 2009, the trial court sent a letter ruling to the parties
awarding Aldrich a judgment of $151,747.28 against Stacy. But also in that letter
ruling, the trial court awarded Stacy a judgment against Michael in the sum of
$190,000 for attorney’s fees, as well as additional conditional appellate attorney’s
fees should he appeal the divorce decree. The trial court stated in the letter
ruling that Stacy’s attorney ―shall prepare the Decree of Divorce, the Wage
4
Withholding Order, and QDRO’s to reflect this ruling and shall submit all orders to
the Court no later than October 23, 2009.‖
But before such a decree could be signed, Michael and Stacy entered into
an agreement to the exclusion of the law firm that deleted the award of the
attorney’s fee judgment of $190,000 plus conditional appellate fees to Stacy from
Michael, and the trial court signed a divorce decree in accordance with the
couple’s agreement, awarding judgment in favor of the law firm against Stacy but
not Michael in the amount of $151,747.28, plus postjudgment interest and
conditional posttrial legal fees. From our review of the letter ruling and the
signed decree, the decree also awards more time with the children to Michael,
reduces his periodic child support and medical support obligations, and reduces
Stacy’s assets by removing not only the $190,000 attorney fee judgment but also
a lien of $249,430 on Michael’s separate property. The signed decree also
provides that Michael will pay a debt of $50,000, whereas the letter ruling
ordered Stacy to pay it, and states that the parents will ―split 50/50 reasonable
college expense and continued healthcare for the children, provided that the
children qualify for that coverage,‖ topics not covered by the letter ruling.
The signed decree specifically provides,
Debts to Wife
IT IS ORDERED AND DECREED that the wife, Stacy . . . ,
shall pay, as a part of the division of the estate of the parties, and
shall indemnify and hold the husband and his property harmless
from any failure to so discharge, these items:
5
....
W-5. The judgment awarded to [the law firm] for attorney’s
fees in the amount of $151,747.28.
....
Attorney’s Fees
....
[The law firm] is awarded a judgment against STACY . . . in
the amount of $151,747.28 for attorney’s fees, with post-judgment
interest at the rate of five percent (5%) per annum. The sum of
$5,000.00 is awarded in the event a motion for new trial is filed but
denied, and the further sum of $20,000.00 in the event of an appeal
to the Court of Appeals is made but is unsuccessful. The sum of
$10,000.00 is awarded if a petition for review is filed but not granted
by the Supreme Court of Texas, the sum of $10,000.00[] is awarded
if the petition for review is granted but the appeal to the Supreme
Court of Texas is unsuccessful. The further sum of $5,000.00 is
awarded in the event a motion for rehearing is filed but not granted
by the Supreme Court of Texas. In the event a petition for writ of
certiorari is filed but not granted by the United States Supreme
Court, the sum of $15,000.00 is awarded, and the sum of
$15,000.00 is awarded in the event a petition for writ of certiorari is
granted but the appeal to the United States Supreme Court is
unsuccessful.
In one of the law firm’s several pre- and postjudgment challenges to the
decree, Aldrich told the trial court,
Now . . . in your ruling, I—I assumed that what you thought
was, Okay, Stac[y] Tedder is going to have to pay this. I’m giving
her a judgment for all these attorney’s fees, and I’m giving her a lien
for the . . . improvements to the real property that was—that was his
separate property. So I—Mr. Aldrich and anybody else with
attorney’s fees can get paid through that lien if Stac[y] gets paid.
You know, that is what I assumed your thinking was. But you can’t
do that, because you granted me a judgment against both of them,
and now look where we are.
6
. . . [T]he effect of what you’ve done cheats me out of my
ability to collect my judgment, and here’s how: You can’t control—
you . . . nor any other court can control what parties do to settle
matters amongst themselves. Now what they’ve done is, because
they want to settle this matter, Ms. Tedder no longer is going—is no
longer going to take a judgment against Mr. Tedder, and in return for
that, he’s going to let her do something else with the—the—the
children. Therefore, because . . . if you don’t enter my judgment,
then—then all of a sudden I’ve just got this one judgment—I mean,
this judgment against this one person, and she has no avenue to
collect anything from him anymore.
A week after the trial court signed the order denying the law firm’s motion
to modify, correct, or reform the judgment, Stacy filed for chapter 7 bankruptcy.
She was discharged from bankruptcy on June 30, 2010. Afterward, this court
reinstated the law firm’s appeal.
II. Award of Attorney’s Fees for Prosecuting the Law Firm’s Suit
Included in its discussion of its issues in its briefs is the law firm’s
contention that the trial court should have awarded reasonable attorney’s fees to
the law firm for prosecuting its intervention. At trial, the law firm presented
uncontroverted testimony concerning the attorney’s fees it incurred in bringing
the intervention. Stacy objected, arguing that an attorney (as opposed to a
nonattorney party) cannot recover fees for prosecuting a case. This court has
already rejected that premise.2 Michael raised no objection specifically targeting
2
See AMX Enters., L.L.P. v. Master Realty Corp., 283 S.W.3d 506, 517
(Tex. App.—Fort Worth 2009, no pet.) (op. on reh’g) (citing Tesoro Petroleum
Corp. v. Coastal Ref. & Mktg., Inc., 754 S.W.2d 764, 766 (Tex. App.—Houston
[1st Dist.] 1988, writ denied), and Beckstrom v. Gilmore, 886 S.W.2d 845, 847
(Tex. App.—Eastland 1994, writ denied)).
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the attorney’s fees that the law firm incurred in prosecuting the suit, nor does he
raise such argument on appeal.
Section 38.001 of the civil practice and remedies code provides that ―[a]
person may recover reasonable attorney’s fees from an individual . . . , in
addition to the amount of a valid claim and costs, if the claim is for . . .
(1) rendered services; (2) performed labor; . . . (7) a sworn account; or (8) an oral
or written contract.‖3 As this court has previously explained,
An award of reasonable attorney’s fees is mandatory under
section 38.001 if there is proof of the reasonableness of the fees.
The amount of the award lies within the discretion of the court, but it
does not have the discretion to deny attorney’s fees if they are
proper. When a claim for attorney’s fees is based on chapter 38, it is
presumed that the usual and customary attorney’s fees are
reasonable, although that presumption may be rebutted.
Factors the trier of fact should consider in determining the
amount of reasonable attorney’s fees include the following: (1) the
time and labor required, the novelty and difficulty of the questions
involved, and the skill required to perform the legal service properly;
(2) the likelihood that the acceptance of the particular employment
will preclude other employment by the lawyer; (3) the fee customarily
charged in the locality for similar legal services; (4) the amount
involved and the results obtained; (5) the time limitations imposed by
the client or by the circumstances; (6) the nature and length of the
professional relationship with the client; (7) the experience,
reputation, and ability of the lawyer or lawyers performing the
services; and (8) whether the fee is fixed or contingent on results
obtained or uncertainty of collection before the legal services have
been rendered.4
3
Tex. Civ. Prac. & Rem. Code Ann. § 38.001 (West 2008).
4
AMX Enters., L.L.P., 283 S.W.3d at 516–17 (citations omitted).
8
The law firm’s fee agreement with Stacy and billing records are attached to
its petition for intervention. At the hearing on the intervention, Aldrich testified
about his experience level, his hourly rate, the hourly rates of associates and
paralegals at the law firm, and the hours incurred:
I’m an attorney licensed to practice law in the State of Texas, and
have been so licensed since November the 6th, 1978. I have tried
and handled many divorce cases [and] many civil matters . . . . I’m
board certified in civil trial law and have been for some years. . . .
In this matter . . . I was the attorney for Mrs. Tedder up until
sometime at the first part of . . . July, . . . after that first part of July I
filed this petition [in] intervention, that— . . . I have incurred
attorney’s fees in bringing it, and I would expect to incur attorney’s
fees in the event of an appeal of this matter. We have kept—kept a
record of the attorney’s fees, that as of yesterday afternoon, when I
got back from the motion to recuse hearing, there were $7,187.50
worth of attorney’s fees and paralegal time involved in this lawsuit.
....
. . . It is my testimony that those fees were reasonable and
necessary in prosecuting this action to collect this debt and to bring
this claim and get this judgment.
I expect . . . that I have spent three hours since yesterday
afternoon and including my time in here . . . on this matter, and for a
total of $8,537.50[], which I believe to be [] reasonable . . . attorney’s
fees in Tarrant County, Texas, for prosecuting this claim through
today.
He testified that he had spent ten or eleven hours on the case at an hourly
rate of $450, that his legal assistant had billed for her time on the case at $125
per hour, that the law firm’s associate lawyers had spent the most time on the
case and billed at $225 per hour. Given the uncontroverted evidence, we hold
that the trial court’s implicit finding that the law firm was entitled to zero attorney’s
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fees for pursuing its intervention is against the great weight and preponderance
of the evidence and, likewise, regarding the trial court’s implicit legal conclusion
that the law firm was entitled to zero attorney’s fees for pursuing its intervention,
that the contrary is established as a matter of law. 5 We therefore hold that the
trial court erred by not including in the client fee award an award of reasonable
and necessary attorney’s fees for the prosecution of the law firm’s intervention.
We sustain this subissue.
III. Joint and Several Liability of Michael for the Client Fee Award
Contrary to the law firm’s allegations on appeal, the absence of a sworn
denial from Michael does not automatically entitle the law firm to a judgment on
sworn account against him. As the Supreme Court of Texas has explained,
There being a fact question as to whether the defendant was a party
to the transaction evident from the face of the plaintiff’s own
invoices, the sworn account is not considered as prima facie proof of
the debt. Therefore, a sworn denial is not required in order for the
respondent to controvert or disprove the account. 6
The evidence supporting the law firm’s pleadings demonstrates that it was
Stacy who signed the contract, Stacy who was billed, and Stacy who failed to pay
the debt. Even if the evidence that Michael had previously paid a large portion of
attorney’s fees to the law firm on the account is evidence that Michael was not a
stranger to the transaction, it presented at most a fact issue, not proof as a
5
See id. at 520.
6
Sundance Oil Co. v. Aztec Pipe & Supply Co., 576 S.W.2d 780, 781 (Tex.
1978).
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matter of law. Accordingly, we cannot say that the trial court erred or abused its
discretion by excluding Michael from the judgment on the suit on sworn account
on the ground that he failed to file a verified denial.
The attorney’s fees, however, were a community debt. Debts contracted
during the marriage are presumed to be community unless it is shown that the
creditor agreed to look solely to the separate estate of the contracting spouse for
payment of the debt.7 The party seeking to overcome the presumption must do
so by clear and convincing evidence. 8 Michael offered no proof in the appellate
record before us that the attorney’s fees were not a debt of the community.
Further, given the trial court’s placement of the debt to the law firm in the
community debts section, the trial court implicitly found that the attorney’s fees
were a community debt.
A finding that attorney’s fees are a debt of the community establishes joint
and several liability of both spouses. 9 In Blake v. Amoco Federal Credit Union,
the Fourteenth Court of Appeals of Texas held,
It is well-settled law in Texas that divorce courts cannot disturb the
rights of a creditor to collect from either of the divorcing parties on a
joint obligation. Johnnie admitted that the debt at issue is a
7
Hawkins v. Ehler, 100 S.W.3d 534, 541 (Tex. App.—Fort Worth 2003, no
pet.); Morris v. Morris, 894 S.W.2d 859, 863 (Tex. App.—Fort Worth 1995, no
writ).
8
Sprick v. Sprick, 25 S.W.3d 7, 13 (Tex. App.—El Paso 1999, pet. denied).
9
Wileman v. Wade, 665 S.W.2d 519, 520–21 (Tex. App.—Dallas 1983, no
writ).
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community debt. Texas courts have consistently held that a division
of the community estate may not prejudice the rights of a creditor to
satisfy a community debt.
Just because Amoco was named a party, answered, and
appeared at the hearing on the clarification and enforcement motion
does not necessarily mean that the court could modify its rights
under the facts presented here. In Broadway Drug, the creditor,
having intervened in the divorce suit, was obviously a party to the
suit. This court recognized that the divorce court had discretion in
dividing property between the spouses, and to provide that one
spouse should pay the debt of the other. We held, however, that the
divorce court could not prejudice the creditor’s right to take a
judgment against both spouses when dividing responsibility for
payment of debts.10
Additionally, section 2.501 of the family code provides,
(a) Each spouse has the duty to support the other spouse.
(b) A spouse who fails to discharge the duty of support is liable to
any person who provides necessaries to the spouse to whom
support is owed.11
A spouse is personally liable for the other spouse’s acts if the other spouse
incurs a debt for necessaries.12 Further, all community property is subject to a
liability for which both spouses are personally liable.13 A spouse’s attorney’s fees
may be regarded as necessaries to protect his legal rights as long as he acts in
10
900 S.W.2d 108, 111–12 (Tex. App.—Houston [14th Dist.] 1995, no writ)
(citations omitted).
11
Tex. Fam. Code Ann. § 2.501 (West 2006).
12
Id. § 3.201.
13
See id. § 3.202 (West Supp. 2010).
12
good faith and on probable cause. 14 The good faith and probable cause
requirements are met by a favorable verdict and orders of the trial court.15
Here, Michael sought sole managing conservatorship, alternatively joint
managing conservatorship with the right to determine the children’s primary
residence, and alternatively a geographic restriction. He also sought child
support. The jury named the parents JMCs and gave Stacy the right to
determine the children’s primary residence within the confines of Arlington
Independent School District; the trial court awarded Stacy, not Michael, child
support. Accordingly, we hold that the good faith and probable cause
requirements are met.16 Consequently, we hold that Stacy’s attorney’s fees due
to the law firm were necessaries. We also therefore hold that Michael is
personally liable for their payment. 17 Finally, because Michael and Stacy were
each personally liable for the client fee award, we hold that the trial court erred by
extinguishing the law firm’s right to collect the client fee award from Michael
jointly and severally. We sustain the law firm’s first two issues in part. Because
14
Navarro v. Brannon, 616 S.W.2d 262, 263 (Tex. Civ. App.—Houston [1st
Dist.] 1981, writ ref’d n.r.e.).
15
Roberts v. Roberts, 193 S.W.2d 707, 709 (Tex. Civ. App.—Dallas 1945,
no writ).
16
See id.
17
See Tex. Fam. Code Ann. §§ 2.501, 3.201.
13
of our disposition of these portions of the first two issues and the unnumbered
subissue, we do not reach the law firm’s remaining issues and subissues. 18
IV. Conclusion
Having held that the trial court erred (1) by excluding from the client fee
award the reasonable and necessary attorney’s fees that the law firm expended
in bringing its intervention below and (2) by insulating Michael from any liability
for paying the client fee award, we reverse the trial court’s judgment on Gardner
Aldrich, LLP’s suit on sworn account in part and affirm it in part. We affirm the
judgment as to the amounts awarded as damages, postjudgment interest, and
conditional posttrial attorney’s fees. We reverse the judgment to the extent that it
awards Gardner Aldrich, LLP zero attorney’s fees for prosecuting its claim below
and to the extent that it excludes Michael from all liability. We render judgment
that (1) Michael and Stacy are jointly and severally liable to Gardner Aldrich, LLP
for the damages, postjudgment interest, and conditional posttrial attorney’s fees
and (2) Michael and Stacy are also jointly and severally liable to Gardner Aldrich,
LLP for reasonable and necessary attorney’s fees incurred by Gardner Aldrich,
LLP in prosecuting its claim below. We remand this case for a new trial solely for
the determination of the proper amount of reasonable and necessary attorney’s
fees incurred by Gardner Aldrich, LLP in pursuing its intervention.
18
See Tex. R. App. P. 47.1.
14
LEE ANN DAUPHINOT
JUSTICE
PANEL: DAUPHINOT, MEIER, and GABRIEL, JJ.
DELIVERED: August 11, 2011
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