REMITTITUR SUGGESTED; and Opinion Filed May 11, 2016.
Court of Appeals
S In The
Fifth District of Texas at Dallas
No. 05-14-01616-CV
LONE STAR ENGINE INSTALLATION CENTER, INC. AND RAFAEL SANCHEZ,
Appellants
V.
BRENDA GONZALES AND GONZALO GONZALES, Appellees
On Appeal from the 191st Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-11-15035
MEMORANDUM OPINION
Before Justices Fillmore, Evans, and Stoddart
Opinion by Justice Fillmore
Appellees Brenda and Gonzalo Gonzales sued appellants Lone Star Engine Installation
Center, Inc. (Lone Star) and Rafael Sanchez, 1 alleging, as relevant to this appeal, 2 that appellants
violated the Texas Deceptive Trade Practices Act (DTPA), see TEX. BUS. & COM. CODE ANN.
§§ 17.41–.63 (West 2011 & Supp. 2015), in connection with repairs appellants made to
appellees’ 2006 Ford F-350 pickup truck. The trial court found appellants intentionally engaged
in conduct that violated the DTPA and awarded appellees economic and mental anguish
damages, additional economic and mental anguish damages under section 17.50(b) of the DTPA,
1
Sanchez owns the stock of Lone Star.
2
In addition to their claims under the DTPA, appellees asserted claims based on fraudulent misrepresentation, negligent repair of a motor
vehicle, and breach of implied warranty. The trial court made findings of fact that would have supported a judgment against appellants based on
any of these theories of liability. Comparing the judgment to the trial court’s findings of fact, it appears appellees elected to recover on their
DTPA cause of action.
and attorney’s fees. In ten issues, appellants contend the trial court’s judgment should be
reversed because appellees are judicially estopped from bringing their claims against appellants,
the evidence is legally and factually insufficient to support the trial court’s findings that
appellants violated the DTPA, and the amount of damages awarded by the trial court, and the
trial court erred by allowing two experts to testify for appellees and allowing one of the experts
to use certain demonstrative exhibits. We affirm the trial court’s judgment, conditioned on
appellees’ agreement to remit a portion of the damages they were awarded.
Background
Appellees filed for Chapter 13 bankruptcy on December 2, 2009. In connection with the
filing, appellees signed several sworn schedules under oath. These schedules reflected
outstanding creditor claims totaling $102,572.35 and that appellees had no contingent or
liquidated claims. Appellees also swore they were not parties to any “suits and administrative
proceedings.” On April 20, 2010, the bankruptcy court confirmed appellees’ March 2, 2010
amended bankruptcy plan. 3 Pursuant to the confirmation order, appellees were required to make
sixty monthly payments to the Chapter 13 trustee of varying amounts totaling $49,212.00.
At some point, Gonzalo noticed appellees’ Ford F-350 pickup truck, the family’s main
vehicle, was overheating, “smoking a little bit,” and did not have towing power. Neither
Gonzalo nor Brenda knew what was wrong with the truck, and Gonzalo contacted Sanchez about
repairing it. On June 23, 2010, a tow truck provided by appellants towed the truck to Lone Star.
Gonzalo testified he told Sanchez about the problems with the truck. According to Brenda, after
Sanchez examined the truck, he told appellees that it needed a new “long block.” 4 Sanchez
3
This plan is not in the record.
4
According to Michael Farmer, appellees’ expert witness, a long block generally consists of approximately eighty percent of the engine,
including cylinder heads, rotating assembly, pistons, connecting rods, bearings, crank shaft, camshaft, bushings, valves, and lifter. It could also
possibly include push rods. When Sanchez was asked what he meant by “long block rebuild engine,” he responded, “It’s a short block. The short
block includes all the internal parts; like a crank shaft, connected rods, piston, piston rings, [and] timing components.”
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testified no one working at Lone Star told appellees the truck needed a new “long block.”
Rather, the truck was not working when it was towed into the shop, and Gonzalo, without telling
anybody at Lone Star that the truck was overheating, requested a “long block” be installed in the
truck. Sanchez told Gonzalo it would cost $3,800 to repair the truck, and Gonzalo agreed to
have the work done. 5
Sanchez, a master mechanic, performed eighty percent of the work on the truck. He
installed the long block, a rebuilt radiator, a reconditioned “turbo,” and two injectors. After
Sanchez worked on the truck, he told appellees the actual cost of the repairs was $6,161.
Appellees paid the charges, and appellants provided a six month warranty on the work done on
the truck. The warranty stated it was void if appellees allowed anyone other than Lone Star to
work on the truck. Brenda testified that, when they arrived at Lone Star to pick up the truck, it
would not start and was “boosted” in order to get it started. According to Sanchez, the truck was
working perfectly and no jump start was required.
Brenda drove the truck to appellees’ home. During the drive, Brenda noticed the truck
was overheating. The next morning, the truck would not start, and appellees saw that one of the
batteries in the truck was not the correct size and was not the battery that had been in the truck
when it was towed to Lone Star. Brenda also noticed “a lot of wires and stuff” were attached,
the radio no longer worked, the floor mats were gone, and the carpet had been moved. Gonzalo
returned the truck to Lone Star and complained that the original battery was missing. When the
original battery could not be found, Sanchez paid Gonzalo compensation.
Appellees continued to have problems with the truck overheating and not having any
towing power. However, they did not take the truck back to appellants because they did not have
5
We note there was evidence the initial quote was $3,850. This discrepancy is not material to our analysis.
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the money for additional repairs. Because the truck was not working properly, appellees used
Brenda’s small car and a pickup truck they borrowed from a neighbor for transportation.
At some point in 2011, Gonzalo took the truck to Farmer’s Diesel & Performance
(FD&P) and told Michael Farmer, the diesel mechanic who owns FD&P, that he had concerns
about the overhaul that had been done by Lone Star on the engine of the truck. Farmer
determined from an inspection of the truck that the auxiliary component’s wiring had been
disturbed and there was an audible noise, similar to “two pipe hands being slapped together.”
Farmer told Gonzalo that he thought there was an external head gasket leak and he was hearing
the combustion event rattle the head gasket. Farmer advised Gonzalo to take the truck back to
the person who had performed the work. Appellees began renting a car on March 2, 2011, when
Brenda’s car also began having problems. According to Gonzalo, the rental car was to replace
the truck while it was in for repairs. Appellees paid $3,117.87 to rent a car until July 1, 2011.
Gonzalo spoke to Sanchez about the problems appellees were having with the truck.
Sanchez assured Gonzalo that it was not a problem that the warranty period had expired and, on
March 15, 2011, Gonzalo arranged for the truck to be taken to Lone Star on a flatbed trailer.
Gonzalo testified the truck had been driven only about 125 miles since appellees picked it up
from Lone Star because the truck was overheating. According to Sanchez, there was oil and
water mixing in the truck and blowing steam out of the tailpipe. He told appellees the truck
needed a new exhaust gas recirculation (EGR) cooler and that the work would cost $750.
Sanchez installed the EGR cooler and, in doing so, “modified” one of the ports to the EGR
system by welding two plugs into the cooler. Sanchez claimed the work he performed
redirected, but did not cut off, the coolant flow to the engine and the modification complied with
modifications being done by Ford and by the “aftermarket.” In Sanchez’s opinion, the engine
ran cooler after the modification because of greater water flow velocity. Sanchez also replaced
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one of the injectors because the truck “was missing on one cylinder.” Lone Star charged
appellees $1,198 for the repairs.
Sanchez drove the truck after these repairs were complete and discovered the
transmission would “lock up” whenever the truck shifted into second gear. Appellees both
testified the transmission was working when the truck was taken to Lone Star, but Sanchez
denied that any of the work he performed would have affected the transmission. Sanchez offered
to replace the transmission if appellees would pay for the labor, but appellees chose to take the
truck to Juan’s Transmission. Appellees paid Juan’s Transmission $1,405.71 to repair the
transmission.
In the summer of 2011, Gonzalo took the truck back to FD&P. Farmer testified the truck
had white smoke in the exhaust at initial start, the truck had a “hard start,” and Gonzalo
complained the engine had been overheating. After a driving test, Farmer confirmed the oil
temperature in appellees’ truck was “extremely excessive.” To determine whether an injector
was bypassing too much high pressure oil, Farmer removed the injectors and performed bench
tests. The tests indicated a “couple” of the injectors were bypassing oil and there was extensive
damage to the spool valves on those injectors. Farmer replaced three of the injectors. After
these repairs, the truck was operable, and Gonzalo instructed Farmer to perform no additional
repairs because he did not have the money to pay for the additional work.
However, when Gonzalo arrived at FD&P to retrieve the truck, it would not start. Farmer
performed additional testing and discovered the injection pressure regulator (IPR) had failed.
The IPR determines the amount of oil directed toward the injectors. When Farmer removed the
IPR, he found it had “disassembled itself” from its normal mounting position. Farmer testified
that his work on the injectors did not cause the IPR failure; rather, it failed because it was the
“next weakest link” after the injectors were repaired.
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According to Farmer, the injectors and the IPR failed because the oil filter allowed
contaminants to enter those components. Farmer removed the oil filter and discovered the oil
filtration bypass pressure plug was “nowhere to be found.” He disassembled the upper intake
system, the turbocharger system, and the oil cooler housing and found the bypass plug had
melted and the residue had run down inside the housing. After the bypass plug melted, the oil in
the truck was not filtered. Farmer examined the high pressure oil reservoir and found a “soup of
metal material” in that reservoir. The oil cooler had “quite a bit of clogging due to the
particulate that had been through it.” According to Farmer, the lack of an oil filter led to the IPR
“disassembling” itself and would lead to erosion throughout the engine. Farmer testified that
every “rotating assembly unit” inside the truck’s engine was damaged.
Farmer testified peak operating temperature for the engine is 212 degrees Fahrenheit, and
the bypass plug is designed to withstand temperatures up to 500 degrees Fahrenheit. Attempting
to locate the source of the high temperature, Farmer examined the EGR cooler, which is
designed to “exchange heat from the exhaust into the coolant in order to cool the exhaust inflow
into the intake of a vehicle.” Farmer found the inlet and outlet flow ports to the EGR cooler had
been welded shut. There was an additional weld in the “circuit on the block.” In Farmer’s
opinion, no reasonable mechanic would weld closed the ports on the EGR cooler because doing
so would block all coolant flow in the system. Although Sanchez admitted he welded two plugs
into the EGR cooler, he denied he placed those plugs at the locations identified by Farmer.
Farmer testified the coolant flow system in the truck is “linear” and stopping the flow of
the coolant at any one point stops the flow to the entire system. If the coolant is blocked and
cannot reach the radiator, the engine will overheat. If the radiator is not working properly, the
transmission components could also overheat. Temperatures of 500 degrees Fahrenheit in the
engine could result in damage to the transmission. Sanchez testified there were many causes of
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transmission failure and denied that any of the work he performed on the truck damaged the
transmission.
Farmer also found a small hole had been drilled in the degas bottle, which is designed to
maintain coolant pressure and allow gasification of coolant to escape the coolant system.
According to Farmer, if the degas bottle has a hole in it, the coolant pressure cannot be contained
and, over time, the coolant will evaporate, leading to excessive temperatures in the engine.
Farmer testified that drilling a hole in the degas bottle is not an “industry standard way” to
reduce pressure in the cooling system. Sanchez denied that he drilled a hole in the degas bottle
in appellees’ truck. In Farmer’s opinion, “the welding and the EGR cooler” damaged the truck,
and appellants “modifications” to the engine caused the need for all the subsequent repair work
on the engine. Farmer charged $2,909.58 to repair the truck.
Gonzalo brought the truck back to FD&P on December 4, 2011, because he was having
additional high pressure oil system failures. Farmer discovered the five injectors that had not
been replaced or repaired during his prior repairs had failed. Farmer testified the failure of these
five injectors was related to the problems the truck was having when he first worked on it, but
appellees could not afford to replace all the injectors during the previous repairs. Farmer
charged appellees $1,807.98 for the additional repairs.
According to Farmer, engine overheating is typically caused by the failure of an EGR
cooler, a fan clutch, or a head gasket. If white smoke was detected in the exhaust, Farmer would
suspect the problem was an EGR cooler failure or an EGR valve sticking intermittently at low
power. In Farmer’s opinion, if appellants had repaired the EGR cooler in June 2010 in
accordance with industry standards, no additional repairs would have been required on appellees’
truck. In Farmer’s experience, it would have cost approximately $900 to do an industry-standard
repair of the EGR cooler.
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Appellees contacted the Southern Methodist University Dedman School of Law’s Civil
Clinic (the Clinic) concerning any claims they might have against appellants. On December 1,
2011, the Clinic filed this lawsuit on appellees’ behalf. In January 2012, the Chapter 13 trustee
in appellees’ bankruptcy filed a motion to dismiss the bankruptcy because appellees had failed to
comply with their obligations under the confirmed plan. On January 17, 2012, appellees
converted the Chapter 13 bankruptcy case to a Chapter 7 case, and Michael J. McNally was
appointed as the Chapter 7 trustee. Appellees filed schedules in the Chapter 7 case, but failed to
disclose their claims against appellants. A creditors meeting under section 341 of the bankruptcy
code was held on February 24, 2012. At that meeting, in response to questions from their
bankruptcy attorney, Amy Skinner, and from McNally, Brenda and Gonzalo both affirmed they
did not have anybody they “could sue at this time” or any “claim or cause of action or potential
lawsuit” that they could bring in order to recover money. Skinner testified she counseled
appellees to answer the questions as they did because she did not believe the Clinic was pursuing
the claims on appellees’ behalf.
Following the creditors meeting, Skinner learned the Clinic had decided to pursue the
claims. On March 21, 2012, Skinner wrote a letter to McNally disclosing the existence of the
lawsuit and stating she agreed with the Clinic’s position that the claim was not an asset of the
Chapter 7 bankruptcy estate. McNally testified he received the letter and took no further action
because he agreed the claim did not belong to the Chapter 7 bankruptcy estate. The bankruptcy
court signed an order discharging appellees on May 24, 2012, and the bankruptcy case was
closed on June 18, 2012.
The trial court found in favor of appellees and awarded economic damages of $16,600.14
and mental anguish damages of $5,000. Pursuant to section 17.50 of the DTPA, the trial court
also awarded additional economic damages of $16,600.14 and mental anguish damages of
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$5,000. Finally, the trial court awarded appellees $15,000 for attorney’s fees through trial as
well as contingent attorney’s fees on appeal. The trial court made findings of fact and
conclusions of law in support of the judgment, and appellants brought this appeal.
Standards Applicable to Trial by Court
In an appeal from a bench trial, we review a trial court’s findings under the same legal
and factual sufficiency-of-the-evidence standards used when determining if sufficient evidence
exists to support an answer to a jury question. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex.
1994); Bayview Loan Servicing, LLC v. Martinez, No. 05-14-00835-CV, 2016 WL 825670, at *2
(Tex. App.—Dallas Mar. 3, 2016, no pet. h.) (mem. op.). We review de novo the trial court’s
conclusions of law. BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 794 (Tex. 2002).
If the trial court rendered the proper judgment, we will not reverse based on an erroneous
conclusion of law. Id.; Bayview Loan Servicing, LLC, 2016 WL 825670, at *2.
When a party attacks the legal sufficiency of an adverse finding on which it did not have
the burden of proof at trial, it must demonstrate there is no evidence to support the finding.
Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983). Conversely, when the party who had the
burden of proof at trial complains on appeal that the evidence is legally insufficient to support an
adverse finding, that party must demonstrate the evidence establishes, as a matter of law, all vital
facts in support of the issue. Dow Chem Co. v. Francis¸ 46 S.W.3d 237, 241 (Tex. 2001) (per
curiam). In determining whether the evidence is legally sufficient to support a finding, we
consider the evidence in the light most favorable to the judgment and indulge every reasonable
inference that would support it. City of Keller v. Wilson, 168 S.W.3d 802, 807, 827 (Tex. 2005).
We must credit favorable evidence if a reasonable factfinder could and disregard contrary
evidence unless a reasonable factfinder could not. Id. at 807, 827. “The final test for legal
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sufficiency must always be whether the evidence at trial would enable reasonable and fair-
minded people to reach the verdict under review.” Id. at 827.
In evaluating a factual sufficiency challenge, we consider and weigh all of the evidence,
not just the evidence supporting the finding. Mar. Overseas Corp. v. Ellis, 971 S.W.2d 402,
406–07 (Tex. 1998). We may set aside the finding only if it is so contrary to the overwhelming
weight of the evidence as to be clearly wrong and unjust. Id.; Cain v. Bain, 709 S.W.2d 175, 176
(Tex. 1986) (per curiam).
The factfinder is the sole judge of the credibility of the witnesses and the weight to be
given their testimony. City of Keller, 168 S.W.3d at 819 (legal sufficiency review); Golden
Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757, 761 (Tex. 2003) (factual sufficiency review).
We will not substitute our judgment for that of the trial court merely because we might reach a
different conclusion. City of Keller, 168 S.W.3d at 819, 822; Golden Eagle Archery, Inc., 116
S.W.3d at 761.
Judicial Estoppel
In their first issue, appellants contend they conclusively established the doctrine of
judicial estoppel so appellees are barred from pursuing their claims against appellants and,
therefore, the trial court erred by failing to dismiss the case. Judicial estoppel is an affirmative
defense, and appellants had the burden of proof to establish it applied to appellees’ claims.
Spartan Tex. Six Capital Partners, Ltd. v. Perryman, No. 14-14-00873-CV, 2016 WL 796073, at
*9 (Tex. App.—Houston [14th Dist.] Mar. 1, 2016, no pet. h.) (considering application of
judicial estoppel to claims being pursued post-bankruptcy that were not disclosed in bankruptcy
proceedings); Phillips v. Flying J Inc., 375 S.W.3d 367, 369 (Tex. App.—Amarillo 2012, no
pet.) (per curiam). Because appellants raised judicial estoppel in the context of appellees’ duties
under the bankruptcy code in a prior bankruptcy proceeding, we apply substantive federal law in
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our analysis of this issue. Norris v. Brookshire Grocery Co., 362 S.W.3d 226, 229 (Tex. App.—
Dallas 2012, pet. denied).
We review the trial court’s decision whether to apply judicial estoppel for abuse of
discretion. Allen v. C&H Distribs., L.L.C., 813 F.3d 566, 572 (5th Cir. 2015). Generally, when
substantive federal claims are raised in state court, state law and procedural rules still govern
manner in which federal questions are tried and proved. See Jack B. Anglin Co. v. Tipps, 842
S.W.2d 266, 268 (Tex. 1992) (orig. proceeding); Mitchell v. Missouri-Kansas-Texas R.R. Co.,
786 S.W.2d 659, 661 (Tex. 1990), overruled on other grounds by Union Pac. R.R. Co. v.
Williams, 85 S.W.3d 162, 169 (Tex. 2002). Because judicial estoppel is a “rule of procedure
based on justice and sound public policy,” Pleasant Glade Assembly of God v. Schubert, 264
S.W.3d 1, 6 (Tex. 2008), we apply Texas law pertaining to the standard of review. Gator Apple,
LLC v. Apple Tex. Rests., Inc., 442 S.W.3d 521, 530 n.4 (Tex. App.—Dallas 2014, pet. denied)
(standard of review is procedural question). 6 A trial court abuses its discretion when it acts
arbitrarily or unreasonably, that is, when it acts without reference to any guiding rules or
principles. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241–42 (Tex. 1985); see
also U-Haul Intern., Inc. v. Waldrip, 380 S.W.3d 118, 132 (Tex. 2012). 7
Applicable Law
Judicial estoppel “is an equitable doctrine invoked by a court at its discretion” for the
purpose of “protect[ing] the integrity of the judicial process.” New Hampshire v. Maine, 532
U.S. 742, 749–50 (2001) (internal quotation marks omitted). It prevents parties from “playing
6
See also Ferguson v. Building Materials Corp. of Am., 295 S.W.3d 642, 644 (Tex. 2009) (per curiam) (applying summary judgment
standard of review under state law to issue of whether plaintiffs were judicially estopped from asserting personal injury claims against defendant
based on failure to timely disclose claims in bankruptcy proceeding); Norris, 362 S.W.3d at 229 (same).
7
The outcome of this case would be the same applying the federal standard of review. See Love v. Tyson Foods, Inc., 677 F.3d 258, 262
(5th Cir. 2012) ([D]eference . . . is the hallmark of an abuse-of-discretion review.”). Under the federal standard of review, a trial court abuses its
discretion when it bases its decision on clearly erroneous factual findings, relies on erroneous conclusions of law, or misapplies the law the facts.
Id.
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fast and loose with the courts to suit the exigencies of self-interest,” Allen, 813 F.3d at 572
(quoting In re Coastal Plains, Inc., 179 F.3d 197, 205 (5th Cir. 1999)), by prohibiting “a party
from asserting a claim in a legal proceeding that is inconsistent with a claim taken by that party
in a previous proceeding.” Reed v. City of Arlington, 650 F.3d 571, 573–74 (5th Cir. 2011) (en
banc) (quoting 18 James Wm. Moore et al., MOORE’S FEDERAL PRACTICE § 134.30 at 63 (3d ed.
2011)). The doctrine is generally applied “where intentional self-contradiction is being used as a
means of obtaining unfair advantage in a forum provided for suitors seeking justice.” In re
Coastal Plains, Inc., 179 F.3d at 206 (quoting Scarano v. Cent. R. Co., 203 F.2d 510, 513 (3d
Cir. 1953)).
In the bankruptcy context, judicial estoppel is used to effectuate the policy goals of
“bring[ing] about an equitable distribution of the bankrupt’s estate among creditors” and
“grant[ing] a fresh start to the honest but unfortunate debtor.” Reed, 650 F.3d at 574 (quoting
Kothe v. R.C. Taylor Trust, 280 U.S. 224, 227 (1930) and Marrama v. Citizens Bank of Mass.,
549 U.S. 365, 367 (2007)). Therefore, the doctrine “must be applied in such a way as to deter
dishonest debtors, whose failure to fully and honestly disclose all their assets undermines the
integrity of the bankruptcy system.” United States ex rel Long v. GSDMidea City LLC, 798 F.3d
265, 271 (5th Cir. 2015) (quoting Reed, 650 F.3d at 574). In order for judicial estoppel to apply,
the trial court should look to whether (1) the party against whom judicial estoppel is sought has
asserted a legal position which is plainly inconsistent with a prior position; (2) a court accepted
the prior position; and (3) the party did not act inadvertently. Id. at 271–72. However, the
presence of one or more of these elements does not mandate the invocation of judicial estoppel.
Id. at 272. Rather, the trial court should determine if applying judicial estoppel is appropriate in
light of the specific facts of each case and the doctrine’s purpose of protecting the integrity of the
judicial process. Id; Love v. Tyson Foods, Inc., 677 F.3d 258, 261 (5th Cir. 2012) (“[J]judicial
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estoppel is not governed by ‘inflexible prerequisites or an exhaustive formula for determining
[its] applicability,’ and numerous considerations ‘may inform the doctrine’s application in
specific factual contexts.’” (quoting New Hampshire, 532 U.S. at 751)).
As relevant to this appeal, when a debtor institutes a Chapter 13 bankruptcy case, a
bankruptcy estate is created. See 11 U.S.C. §§ 301, 541. Virtually all of the debtor’s assets vest
in the bankruptcy estate upon the filing of the Chapter 13 petition. Id. § 541; see also Kane v.
Nat’l Union Fire Ins. Co., 535 F.3d 380, 385 (5th Cir. 2008) (per curiam). The debtor is
required to file schedules listing the debtor’s assets and liabilities and a statement of the debtor’s
financial affairs. 11 U.S.C. § 521(a)(1)(B)(i), (iii); FED. R. BKRTCY. P. 1007(b). In a typical
Chapter 13 case, the bankruptcy estate is administered, through a plan developed by the debtor,
by the bankruptcy trustee over a period of three to five years. Id. §§ 1302, 1321–22; Harris v.
Veigelahn, 135 S. Ct. 1829, 1835 (2015). The Chapter 13 debtor has a continuing obligation
while the Chapter 13 bankruptcy proceeding is pending to disclose a post-petition cause of action
acquired by the debtor. Allen, 813 F.3d at 572; Flugence v. Axis Surplus Ins. Co. (In re
Flugence), 738 F.3d 126, 129 (5th Cir. 2013) (per curiam).
A debtor may convert his Chapter 13 bankruptcy case to a liquidation under Chapter 7 of
the bankruptcy code. 11 U.S.C. § 1307(a); Harris, 135 S. Ct. at 1835. “No motion or court
order is needed to render the conversion effective.” Harris, 135 S. Ct. at 1835–36 (citing FED. R.
BKRTCY. P. 1017(f)(3)). Such a conversion does not effect a change in the date of the filing of
the petition. 11 U.S.C. § 348(a). Once a Chapter 13 case is converted to a Chapter 7 case,
“property of the estate in the converted case shall consist of property of the estate, as of the date
of filing of the petition, that remains in the possession of or is under the control of the debtor on
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the date of conversion.” Id. § 348(f)(1)(A). 8 Whether a particular cause of action belongs to the
Chapter 7 bankruptcy estate “depends on whether under applicable state law the debtor could
have raised the claim as of the commencement of the case.” Schertz-Cibolo-Universal City,
Indep. Sch. Dist. v. Wright (In re Educators Grp. Health Trust), 25 F.3d 1281, 1284 (5th Cir.
1994)
Analysis
Appellants argue the trial court abused its discretion by failing to apply judicial estoppel
to bar appellees’ claims against appellants because appellees had a duty to disclose their claims
against appellants in the bankruptcy case, their failure to disclose the claims was a representation
to the bankruptcy court that the claims did not exist, and the bankruptcy court relied on that
representation when it granted appellees a “no asset” discharge in the Chapter 7 case. The trial
court concluded the existence of appellees’ “post-petition claims against [appellants] was not
material to the bankruptcy case and so could not have been relied upon by the bankruptcy court
to effect its Chapter 7 discharge order,” which relates to judicial acceptance, the second element
of judicial estoppel. See Long, 798 F.3d at 271. The acceptance element ensures that judicial
estoppel is applied only in situations where the integrity of the judicial process is jeopardized.
Wells Fargo Bank, N.A. v. Oparaji (In re Oparaji), 698 F.3d 231, 237 (5th Cir. 2012); see also
Allen, 813 F.3d at 572–73. “Absent judicial acceptance of the inconsistent position, application
of the rule is unwarranted because no risk of inconsistent results exists.” Allen, 813 F.3d at 572–
73 (quoting In re Oparaji, 698 F.3d at 237).
The judicial acceptance requirement does not mean the party against whom the judicial
estoppel doctrine is to be invoked must have prevailed on the merits. In re Coastal Plains, Inc.,
8
If it is determined a debtor “convert[ed] a case under Chapter 13 . . . to a case under another chapter under [Title 11] in bad faith, the
property of the estate in the converted case shall consist of the property of the estate as of the date of conversion.” 11 U.S.C.§ 348(f)(2). There
are no allegations appellees acted in bad faith in converting their bankruptcy case from a Chapter 13 proceeding to a Chapter 7 proceeding.
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179 F.3d at 206. Rather, judicial acceptance means only that the first court has adopted the
position urged by the party, either as a preliminary matter or as part of a final disposition. Id.
“Although the Fifth Circuit has noted that the ‘contours’ of this prong are vague, it has in
practice required that the prior court ‘actually accept’ the party’s earlier position.” Norris, 362
S.W.3d at 230 (citing Hopkins v. Cornerstone Am., 545 F.3d 338, 348 n.2 (5th Cir. 2008)). A
court accepts the party’s position if it relies on the assertion in making a decision or ruling.
Horsley-Layman v Adventist Health Sys./Sunbelt, Inc., 221 S.W.3d 802, 808 (Tex. App.—Fort
Worth 2007, pet. denied) (citing In re Coastal Plains, Inc., 179 F.3d at 206); see also In re
Flugence, 739 F.3d at 130 (judicial acceptance element satisfied when “the bankruptcy court
accepted the prior position by omitting any reference to the personal-injury claim in the modified
plan” because “[h]ad the court been aware of the claim, it may well have altered the plan”);
Jethroe v. Omnova Solutions, Inc., 412 F.3d 598, 600 (5th Cir. 2005) (judicial acceptance
element satisfied when bankruptcy court confirmed debtor’s bankruptcy plan in reliance on the
veracity of his asset schedules).
In this case, appellees’ claims against appellants did not arise until after the confirmation
of appellees’ amended Chapter 13 bankruptcy plan. Appellees did not amend their schedules in
the Chapter 13 proceeding to include their post-petition, post-confirmation claims against
appellants and did not include the claims on the schedules filed after the Chapter 13 case was
converted to a Chapter 7 case. While under oath at the creditors’ meeting following the
conversion to a Chapter 7 case, appellees denied the existence of any lawsuits pursuant to which
they might collect money. 9 Approximately three weeks after the creditors’ meeting, appellees
disclosed their claims against appellants in a letter to the Chapter 7 trustee. The Chapter 7
9
Appellees’ testimony at the creditors’ meeting was incorrect. However, due to a miscommunication about the status of the filing of this
lawsuit, appellees’ bankruptcy counsel instructed them to answer the questions as they did. Appellees’ bankruptcy counsel took steps to correct
the incorrect testimony by informing the Chapter 7 trustee of the claims once she was aware that the lawsuit against appellants was proceeding.
–15–
trustee agreed with appellees’ bankruptcy counsel that the claims against appellants were not
property of the Chapter 7 bankruptcy estate and took no action after he learned of the claims.
The bankruptcy court granted appellees a “no asset” discharge approximately two months after
they disclosed the claims to the Chapter 7 trustee.
Based on the record before us, appellants failed to conclusively establish the bankruptcy
court relied on or accepted any representations by appellees that they did not have a claim
against appellants. There is no evidence that, after appellees’ claims against appellants accrued,
the bankruptcy court took any action or made any ruling in the Chapter 13 bankruptcy case
which would have required it to rely on appellees’ implied representation they did not have any
claims against appellants. See Banks v. Corrections Corp. of Am., No. 4:30CV401-P-B, 2005
WL 1876371, at *2 (N.D. Miss. Aug. 8, 2005) (acceptance element not satisfied when record
does not reflect bankruptcy court relied upon failure to disclose post-petition claim in amended
schedule in Chapter 13 case and “[c]ommon sense suggests that the nondisclosure was
harmless”). Following the conversion to a Chapter 7 case, the only action taken by the
bankruptcy court in reliance on appellees’ schedules was the granting of a “no asset” discharge.
However, appellees’ claims against appellants, which were acquired after the filing of the
Chapter 13 bankruptcy petition, were not property of the Chapter 7 estate. 11 U.S.C.
§ 348(f)(1)(A); Harris, 135 S. Ct. at 1835 (Chapter 7 debtor is able to make “fresh start” by
shielding from creditors his post-petition earnings and acquisitions). The lack of an amended
schedule listing an asset “that is not property of the bankruptcy estate and cannot be administered
by the Chapter 7 trustee has no impact on the entry of a discharge order in a Chapter 7 case.” In
re Wakefield, 312 B.R. 333, 339 (N.D. Tex. 2004).
Judicial estoppel is an equitable doctrine applied at the trial court’s discretion based on
the particular facts in a case. New Hampshire, 532 U.S. at 749–50; Long, 798 F.3d at 272.
–16–
Although we do not condone appellees’ failure to disclose in their bankruptcy proceeding that
they had claims against appellants, the record does not reflect appellees’ failure to do so was an
“intentional self-contradiction . . . being used as a means of obtaining unfair advantage in a
forum provided for suitors seeking justice,” In re Coastal Plains, Inc., 179 F.3d at 206, 10 or
undermined the integrity of the judicial process. See Long, 798 F.3d at 271. Based on this
record, and giving proper deference to the trial court’s ruling, we cannot conclude the trial court
abused its discretion by refusing to apply the doctrine of judicial estoppel to bar appellees from
pursing their claims against appellants. See Fannin v. Fereday, No. 01-13-00951-CV, 2015 WL
4463694, at *6 (Tex. App.—Houston [1st Dist.] July 21, 2015, no pet.) (mem. op.) (trial court
did not abuse its discretion by failing to apply doctrine of judicial estoppel when it could have
reasonably concluded party was not successful in persuading prior courts in accepting his
position); see also Nine Syllables, LLC v. Evans, No. 05-13-01677-CV, 2015 WL 3932751, at *6
(Tex. App.—Dallas June 26, 2015, no pet.) (mem. op.) (trial court did not abuse discretion in
refusing to apply doctrine of judicial estoppel when, based on facts of case, it could have
reasonably concluded party was not entitled to benefit of equity). 11 We resolve appellants’ first
issue against them.
Expert Testimony
In their eighth and ninth issues, appellants assert the trial court erred by considering
expert testimony from Farmer because he was not qualified to testify and his testimony was not
reliable and from Eliot Shavin, appellees’ expert witness on attorney’s fees, because his
testimony was not reliable. Appellees initially contend appellants waived these issues because
10
See also Ferguson, 295 S.W.3d at 644 (doctrine of judicial estoppel did not apply to bar claims because parties had taken neither a
clearly inconsistent position nor obtained an unfair advantage by failing to initially disclose personal injury claim in bankruptcy proceeding).
11
See also In re Paige, 610 F.3d 865, 877 (5th Cir. 2010); Perryman, 2016 WL 796073, at *10 (recognizing court not required to apply
judicial estoppel even if elements met) (citing Long, 798 F.3d at 271–72).
–17–
they failed to timely object to Farmer’s or Shavin’s testimony pursuant to the trial court’s
scheduling order and failed to timely object to the testimony at trial.
In a scheduling order signed on April 2, 2012, the trial court set the case for trial on
November 12, 2012, and ordered that, unless otherwise provided by order, none of the deadlines
established in the scheduling order would be altered if the case was reset or continued. As
relevant to this issue, the scheduling order stated the deadline for filing a motion to exclude or
limit expert testimony was forty-five days before the initial November 12, 2012 trial setting, or
September 28, 2012, or “such objection is waived.” Appellants did not object to Farmer’s or
Shavin’s testimony by the September 28, 2012 deadline.
A trial court has wide discretion to manage its docket, and we will not interfere with the
exercise of that discretion without a showing of clear abuse. Bagwell v. Ridge at Alta Vista
Invests. I, LLC, 440 S.W.3d 287, 292 (Tex. App.—Dallas 2014, pet. denied). We review a trial
court’s enforcement of its scheduling order for an abuse of discretion. Id. An abuse of
discretion occurs when the trial court acts in an unreasonable and arbitrary manner, or when it
acts without reference to guiding rules or principles. Gunn v. Fuqua, 397 S.W.3d 358, 377 (Tex.
App.—Dallas 2013, pet. denied). “When reviewing matters committed to the trial court’s
discretion, we may not set aside the trial court’s ruling unless it is clear from the record that the
trial court could reach only one decision.” McKinney Ave. Properties No. 2, Ltd. v. Branch Bank
& Trust Co., No. 05-14-00206-CV, 2015 WL 3549877, at *3 (Tex. App.—Dallas June 5, 2014,
no pet.) (mem. op.).
The trial court ordered that all motions to exclude or limit expert testimony were required
to be filed by September 28, 2012, or the objections were waived. Appellants failed to timely
object to Farmer’s or Shavin’s testimony as an expert witness and, therefore, have waived any
such objections on appeal. Further, appellants do not challenge the trial court’s exercise of its
–18–
discretion in making any of the rulings set out in the scheduling order or by enforcing the
scheduling order. We resolve appellants’ eighth and ninth issues against them.
Demonstrative Exhibits
In their tenth issue, appellants contend the trial court abused its discretion by allowing
appellees to use as demonstrative exhibits several automobile parts Farmer removed from
appellees’ truck. Appellants specifically argue they were surprised by the use of the parts as
demonstrative exhibits, the use of the parts was prejudicial, and the parts were not listed on
appellees’ exhibit list.
Farmer testified he kept some of the parts he removed from appellees’ truck and brought
those parts to trial. Appellants objected that the parts had not been listed on appellees’ exhibit
list. Appellees indicated the parts were not being offered into evidence. Appellants then
objected:
In that case, Your Honor, it’s not for demonstrative purposes, they need to show
this exactly as direct evidence of what happened, not for demonstration purposes.
And unless they do that, I don’t believe the Court has – I’m sorry. It’s my
position that the Court should deny the admission of this evidence, which we’ve
never had an opportunity to inspect. 12
The trial court sustained the objection and ordered the parts would not be admitted into evidence,
but allowed Farmer to use the parts as demonstrative exhibits.
Even if the trial court erred by allowing Farmer to use the parts as demonstrative exhibits,
appellants were required to show they were harmed by the use of the parts. See TEX. R. APP. P.
44.1(a). To determine whether the error probably resulted in an improper judgment, we must
review the entire record. City of Brownsville v. Alvarado, 897 S.W.2d 750, 754 (Tex. 1995).
12
Appellees argue this objection fails to comport with appellees’ complaints on appeal. However, this objection specifically apprised the
trial court that appellant objected to the parts because they were not included on appellees’ exhibit list. Appellants also objected they had not had
an opportunity to inspect the parts, which we conclude was sufficient to inform the trial court that appellants were surprised.
–19–
Reversible error usually does not occur in connection with an evidentiary ruling unless the
judgment turns on the complained-of evidence. Id.
Appellants’ entire argument on appeal regarding any harm they suffered from the use of
the parts as demonstrative exhibits is “the prejudice and surprise was self-evident as it was
sprung on the defense during” Farmer’s testimony and “[o]nce the objects were identified as the
same parts removed and shown to the court, the prejudice attached.” Although we question
whether appellants adequately briefed the harm analysis, see TEX. R. APP. P. 38.1(h), (i), we have
reviewed the entire record to determine whether the use of the parts as demonstrative evidence
probably resulted in an improper judgment. After sustaining appellants’ objection to the
admission of the parts into evidence, the trial court stated it would allow Farmer to use the parts
as demonstrative aids and that is looking at the parts only “to see what the parts look like.”
Along with the parts used by Farmer as demonstrative exhibits, there were other demonstrative
exhibits, including parts used by Sanchez during his testimony and drawings of the engine, that
also showed the trial court “what the parts looked like.” Further Sanchez admitted he welded
two plugs into the ports of the EGR cooler, one of the parts reviewed by the trial court, and
disputed only that his conduct caused any harm to the truck’s engine. Based on this record, we
cannot conclude the trial court’s judgment turned on Farmer’s use of the parts removed from
appellees’ truck as demonstrative exhibits. We resolve appellants’ tenth issue against them.
The DTPA
We finally address appellants’ second through seventh issues, challenging the trial court’s
findings they were liable under the DTPA and the amount of damages awarded by the trial court.
To establish their DTPA claim against appellants, appellees were required to prove (1) they were
consumers as defined by the DTPA; (2) appellants engaged in false, misleading, or deceptive
acts, breached an express or implied warranty, or engaged in an unconscionable action or course
–20–
of action; and (3) these acts constituted a producing cause of appellees’ damages. TEX. BUS. &
COM. CODE ANN. § 17.50(a) (West 2011); Doe v. Boy’s Clubs of Greater Dallas, Inc., 907
S.W.2d 472, 478 (Tex. 1995); Bishop Abbey Homes Ltd. v. Hale, No. 05-14-01137-CV, 2015
WL 9167799, at *10 (Tex. App.—Dallas Dec. 16, 2015, pet. denied) (mem. op.).
In their fifth through seventh issues, appellants assert the evidence is legally and factually
insufficient to support the trial court’s findings that appellants: (1) committed unconscionable
acts or practices; (2) breached warranties; and (3) breached the DTPA “laundry list.” 13
Appellants, however, failed to substantively brief any of these complaints. An appellant’s brief
must concisely state all issues or points presented for review and, among other things, must
contain a clear concise argument for the contentions made, with appropriate citations to
authorities and to the record. TEX. R. APP. P. 38.1(i). We may not speculate as to the substance
of the specific issues asserted by an appellant and may not make a party’s argument for him.
Strange v. Cont’l Cas. Co., 126 S.W.3d 676, 678 (Tex. App.—Dallas 2004, pet. denied); Valadez
v. Avitia, 238 S.W.3d 843, 845 (Tex. App.—El Paso 2007, no pet.). And we have no duty to
perform an independent review of the record and the applicable law to determine if the trial court
erred. Strange, 126 S.W.3d at 678; Castro v. Castro, No. 04-14-00785-CV, 2015 WL 8984139,
at *1 (Tex. App.—San Antonio Dec. 16, 2015, pet. filed) (mem. op.). An appellant’s failure to
cite legal authority or provide substantive analysis of a legal issue results in waiver of the
complaint. Fredonia State Bank v. Gen. Am. Life Ins. Co., 881 S.W.2d 279, 284 (Tex. 1994)
(observing that error may be waived by inadequate briefing); Huey v. Huey, 200 S.W.3d 851,
854 (Tex. App.—Dallas 2006, no pet.). We conclude appellants have waived their fifth through
seventh issues and resolve those issues against them.
13
The DTPA “laundry list,” set out in section 17.46(b) of the business and commerce code, identifies deceptive acts that are actionable
under the statute. Diais v. Land Rover Dallas, L.P., No. 05-15-00115-CV, 2016 WL 1298392, at *8 (Tex. App.—Dallas Apr. 4, 2016, no pet. h.)
(mem. op.); see also TEX. BUS. & COM. CODE ANN. § 17.46(b)(1)–(31) (West Supp. 2015).
–21–
We next turn to appellants’ complaints in their second through fourth issues that the trial
court erred by awarding: (1) economic damages of $16,600.14, because the evidence is legally
and factually insufficient to support the awarded damages and some of the damages amount to a
double recovery; (2) mental anguish damages of $5,000, because the evidence is factually
insufficient to support the award; and (3) additional economic damages of $16,600.14 and
additional mental anguish damages of $5,000, because the evidence is legally and factually
insufficient to support a finding that appellants’ conduct that violated the DTPA was committed
knowingly or intentionally.
A plaintiff who prevails on a DTPA claim may recover the amount of economic damages
found by the factfinder. TEX. BUS. & COM. CODE ANN. § 17.50(b)(1). “Economic damages” are
“compensatory damages for pecuniary loss, including costs of repair and replacement.” Id.
§ 17.45(11). If the factfinder determines the defendant’s conduct that violated the DTPA was
committed knowingly or intentionally, the plaintiff may also recover damages for mental
anguish. Id. § 17.50(b)(1). Finally, the factfinder may award additional damages of “not more
than three times the amount of economic damages” if the defendant acted knowingly and “not
more than three times the amount of damages for mental anguish and economic damages” if the
defendant acted intentionally. Id.; see also Henry Schein, Inc. v. Stromboe, 102 S.W.3d 675, 686
n.29 (Tex. 2003).
Economic Damages
The trial court awarded appellees economic damages of $16,600.14, representing “(1) the
total amount paid by [appellees] to [appellants] and subsequent third parties to restore the Truck
to proper working condition, and (2) [appellees’] transportation expenses during the Truck’s
inoperability resulting from [appellants’] faulty repairs, intentional damage, and intentional
misrepresentations.” In their second issue, appellants first argue there is no evidence to support
–22–
the award of economic damages of (1) $6,161, the amount paid by appellees to appellants for the
installation of the long block in June 2010; (2) $1,405.71, the amount paid by appellees to Juan’s
Transmission to repair the transmission; and (3) $3117.87, the amount paid by appellees to rent a
car from March 2, 2011, through July 6, 2011. Appellants specifically argue that Farmer did not
opine about the installation of the long block or about the cause of the transmission failure and
appellees rented a car because Brenda’s car began experiencing problems and not because of any
work performed by appellants on the truck. We construe appellants’ complaint to be the
evidence is legally insufficient to establish their conduct was the producing cause of these
elements of the economic damages awarded by the trial court. See TEX. BUS. & COM. CODE
ANN. § 17.50(a) (consumer may maintain action under DTPA where defendant’s conduct that
violated DTPA was producing cause of economic damages).
As to the installation of a long block into the truck in June 2010, the trial court concluded
appellants violated the DTPA by (1) intentionally misrepresenting to appellees that the truck
could be restored to proper working order for $3,800, and then charging appellees $6,161; 14 (2)
intentionally representing to appellees that the work and repairs on the truck would restore it to
proper working order; 15 (3) breaching an implied or express warranty by failing to repair the
truck; 16 and (4) engaging in an unconscionable course of conduct by taking advantage of
appellees’ lack of knowledge or experience to a grossly unfair degree by intentionally charging
for repairs that were not completed in a good and workmanlike manner, where the work was
14
See TEX. BUS. & COM. CODE ANN. § 17.46(b)(13) (West Supp. 2015) (knowingly making false or misleading statements concerning need
for parts, replacement or repair service is violation of DTPA).
15
See id. § 17.46(b)(22) (representing that work or services have been performed on, or parts replaced in, goods when work or services
were not performed or parts replaced is violation of DTPA)
16
See id. § 17.46(b)(12) (representing an agreement confers or involves rights, remedies, or obligations which it does not have or involve,
or which are prohibited by law, is violation of DTPA).
–23–
below the standards for an automobile engine repair mechanic and appellants intentionally
overcharged for parts and labor, and charging for unnecessary repairs. 17
Both Brenda and Gonzalo testified they were not automobile mechanics and, while they
knew the truck was overheating, they did not know the cause of the problem. Gonzalo testified
he told Sanchez about the problems with the truck and asked Sanchez what was wrong with the
truck and how much the repairs would cost. Sanchez initially provided a quote of $3,800 for the
installation of a “long block” into the truck but, when the work was completed, appellants
charged appellees $6,161 for the work. Brenda and Gonzalo testified that, after they picked the
truck up following the June 2010 work, the truck was still overheating and had developed
additional problems. The trial court found that Sanchez intentionally misrepresented the truck
was in proper working condition.
Farmer testified he believed the truck could have been repaired in June 2010 by the
replacement of the EGR cooler. He also testified that, when Gonzalo brought the truck to
FD&P, the engine on the truck was not clean and did not look new and the pistons had a
manufacturer’s part number, rather than being an “aftermarket” part. This led him to believe
appellants had not performed all the work on the truck that they represented had been done in
June 2010. We conclude there is more than a scintilla of evidence to support the trial court’s
conclusion that appellants violated the DTPA by performing unnecessary repairs in June 2010
and by not performing all the work on the truck that they represented to appellees had been done.
As to the payment to Juan’s Transmission to repair the transmission of the truck, the trial
court concluded appellants violated the DTPA by (1) intentionally misrepresenting to appellees
that their truck would be restored to proper working condition by installing a new EGR cooler
17
See id.§§ 17.50(a)(3) (consumer may maintain cause of action under DTPA based on an unconscionable action or course of action by any
person); 17.45(5) (“unconscionable action or course of action” is “an act or practice which, to a consumer’s detriment, takes advantage of the lack
of knowledge, ability, experience, or capacity of the consumer to a grossly unfair degree”).
–24–
for $750, charging appellees $1,198 for the repairs, and failing to repair the truck; 18 (2)
intentionally misrepresenting to appellees that appellants’ work and repairs on the truck would
restore it to proper working order, but failing to restore the truck to working order and causing
further damage to the truck, rendering it inoperable; 19 and (3) breaching the implied warranty of
good and workmanlike repairs by failing to repair the engine and actually causing further
damage to the truck. 20
Farmer testified that, at some point, the engine in the truck overheated to the point it
melted an oil bypass plug designed to withstand temperatures of 500 degrees Fahrenheit. In
Farmer’s opinion, the engine overheated to this degree due to the work Sanchez performed on
the engine, including welding plugs into the ports of the EGR cooler. Farmer also testified that,
when the engine overheated to this point, the transmission fluid could also overheat, leading to
damage to the transmission. Sanchez admitted he drove the truck after he completed the repairs
and noticed the transmission was not working properly. Both Brenda and Gonzalo testified the
transmission was working when they took the truck to appellants in March 2011. We conclude
there is more than a scintilla of evidence to support the trial court’s conclusion that appellants
violated the DTPA by misrepresenting the truck would be repaired, failing to repair the truck,
and performing work that caused further damage to the truck.
As to the costs appellees incurred to rent a car, the trial court found that, due to engine
problems, the truck was inoperable from March 2011 through July 2011, and appellants incurred
$3,117.67 in rental car fees from March 2, 2011, through July 6, 2011, while the truck was
inoperable. Brenda testified the truck was the main source of transportation for the family.
18
See id. § 17.46(b)(13).
19
See id. §17.46(b)(22).
20
See id. §17.50(a)(2) (consumer may maintain cause of action under DTPA where breach of an express or implied warranty is producing
cause of economic or mental anguish damages).
–25–
When the truck was not working, the family attempted to manage their transportation needs
using her small car and a pickup truck they borrowed from a neighbor. However, in March
2011, her car began to have mechanical difficulties so they were forced to rent a car.
Accordingly, although Brenda’s car becoming unreliable was the final factor that forced
appellees to rent a car, doing so would not have been necessary if the truck had been repaired
properly by appellants. We conclude there is more than a scintilla of evidence to support the trial
court’s award of the rental car fees to appellees.
Appellants finally assert appellees were allowed a double recovery of economic damages
because the trial court found the work Farmer performed on the truck restored it to working
condition. Therefore, appellants argue, the additional award to appellees of the charges for the
work performed by appellants and Juan’s Transmission on the truck constituted a double
recovery.
The DTPA allows a trial court to make “orders necessary to restore to any party to the
suit any money or property, real or personal, which may have been acquired in violation of this
subchapter.” TEX. BUS. & COM. CODE ANN. § 17.50(b)(3). “[S]ection 17.50(b)(3)’s restoration
remedy contemplates mutual restitution.” Cruz v. Andrews Restoration, Inc., 364 S.W.3d 817,
826 (Tex. 2012). Restoration provides a consumer prevailing on a DTPA claim “the option of
unwinding the transaction, returning the parties to the status quo ante,” or restoring the parties to
their original positions. Id. If it is possible to ascertain the benefit the consumer received from
the transaction, that benefit must be deducted from the awarded damages. Id. 826–27.
The trial court awarded appellees $16,600.14, representing the amounts appellees paid to
appellants, Juan’s Transmission, and Farmer and for the rental car. 21 The trial court, therefore,
awarded appellees all of the out-of-pocket expenses they incurred in connection with the repair
21
We note these amounts actually total $16,601.14.
–26–
work on the truck. However, after Farmer completed his work on the truck, appellees had a
working vehicle. This was not the status quo when appellees took the truck to appellants in June
2010 to be repaired. Farmer testified that, in his opinion, the truck could have been repaired in
June 2010 by replacing the EGR cooler, work that would have cost approximately $900.
Therefore, if appellants had properly repaired the truck in June 2010, appellees would have paid
them $900 for the work.
To restore the parties to the position they were in prior to the transaction that violated the
DTPA, the benefit appellees received from the transaction must be deducted from their economic
damages. Cruz, 364 S.W.3d at 826–27; Steele v. Goddard, No. 10-12-00111-CV, 2013 WL
3013671, at *12–13 (Tex. App.—Waco June 13, 2013, pet. denied) (mem. op.). We, therefore,
conclude that, although there is evidence to support an award of economic damages to appellees,
the $16,600.14, awarded by the trial court is not supported by the evidence. If, as we conclude
here, part of a damages award lacks sufficient evidentiary support, the proper course is to suggest
a remittitur of that part of the verdict. Larson v. Cactus Util. Co., 730 S.W.2d 640, 641 (Tex.
1987); see also TEX. R. APP. P. 46.3 (court of appeals may suggest a remittitur); Akin, Gump,
Strauss, Hauer & Feld, L.L.P. v. Nat’l Dev. & Research Corp., 299 S.W.3d 106, 124 (Tex.
2009). Consequently, we suggest a remittitur of $900 of the economic damages awarded by the
trial court as well as $900 of the additional economic damages awarded by the trial court. As the
prevailing party at trial, appellees must be given the option of accepting the remittitur or having
the case remanded for a new trial. TEX. R. APP. P. 46.3; Larson, 730 S.W.2d at 641; McLeod v.
Gyr, 439 S.W.3d 639, 650 (Tex. App.—Dallas 2014, pet. denied).
We resolve appellants’ second issue against them to the extent it challenges the legal
sufficiency of the evidence to establish appellants’ conduct was the producing cause of certain
elements of the economic damages awarded by the trial court. We resolve appellants’ second
–27–
issue in their favor to the extent that the economic damages awarded by the trial court constituted
a double recovery. If the suggested remittitur of $1,800 is timely filed, we will modify and
affirm the judgment in accordance with the remittitur. TEX. R. APP. P. 46.3; McLeod, 439
S.W.3d at 650. However, if the remittitur is not timely filed, we will reverse the judgment and
remand for a new trial. TEX. R. APP. P. 46.3; McLeod, 439 S.W.3d at 650.
Mental Anguish
In their third issue, appellants contend the evidence is factually insufficient to support the
award of mental anguish damages to appellees. A party prevailing on a DTPA claim may
recover mental anguish damages if the factfinder determines the defendant’s conduct was
committed knowingly or intentionally. TEX. BUS. & COM. CODE ANN. § 17.50(b)(1). In this
case, the trial court found appellants intentionally engaged in conduct that violated the DTPA
and awarded appellees $5,000 in mental anguish damages.
We are required to “closely scrutinize” awards of damages for mental anguish. Universe
Life Ins. Co. v. Giles, 950 S.W.2d 48, 54 (Tex. 1997); Bishop Abbey Homes, Ltd., 2015 WL
9167799, at *15. “There must be both evidence of the existence of compensable mental anguish
and evidence to justify the amount awarded.” Hancock v. Variyam, 400 S.W.3d 59, 68 (Tex.
2013). “Mental anguish is only compensable if it causes a ‘substantial disruption in . . . daily
routine’ or ‘a high degree of mental pain and distress.’” Id. (quoting Parkway Co. v. Woodruff,
901 S.W.2d 434, 444 (Tex. 1995), and Bentley v. Bunton, 94 S.W.3d 561, 606 (Tex. 2002)).
Even when an event is of the type for which mental anguish damages may be recovered, there
must be evidence of the nature, duration, and severity of the mental anguish. Id. There must
also be evidence that the amount of mental anguish damages awarded is fair and reasonable
compensation. Saenz v. Fid. & Guar. Ins. Underwriters, 925 S.W.2d 607, 614 (Tex. 1996).
However, damages for non-pecuniary harm such as mental anguish “do not require certainty of
–28–
actual monetized loss,” but instead “are measured by an amount that ‘a reasonable person could
possibly estimate as fair compensation.’” Waste Mgmt. of Tex., Inc. v. Tex. Disposal Sys.
Landfill, Inc., 434 S.W.3d 142, 153 (Tex. 2014) (quoting RESTATEMENT (SECOND) OF TORTS
§ 905 cmt. i).
The trial court found appellees suffered significant mental anguish because their source
of transportation was rendered inoperative and because of the significant strain on their personal
finances from appellants’ conduct. Appellants argue there is no evidence their conduct had any
bearing on appellees’ lives and appellees were under other “significant and longer lasting
unrelated financial strains” than the costs to repair their truck, including a three-year suspension
of Gonzalo by the Louisiana Racing Commission in October 2012, leading to a loss of income to
appellees.
Gonzalo testified the stress from the Louisiana investigation was not a “significant
stress.” However, the financial stress from paying for repairs to the truck was a significant
stress. According to Gonzalo, the costs to repair the truck put the family into a financial crisis.
He was recovering from a heart attack and was not supposed to be working, but had to go back to
work in order to provide for his family. He also had to borrow money from his father to pay for
the repairs to truck. Gonzalo testified that it had been fifteen years since he had been required to
borrow money from his father and he would “rather cut [his] throat than ask him for anything.”
Brenda testified the “ordeal of getting the truck fixed” caused a lot of tension within the
family. The truck was their main form of transportation and was used to transport their
grandchildren, who were living with them, to psychological therapy and to their activities. She
was “walking around crying,” at “ends” with her daughter, who lived with them, because of the
stress, and the grandchildren could not understand why everybody was “crabby and cranky.”
The cost of the repairs prevented them from paying other bills, and both she and Gonzalo were
–29–
“worried sick” about how they were going to pay for the repairs. The cost of the repairs affected
her relationship with Gonzalo as well as Gonzalo’s relationship with their daughter. Their
daughter moved out of the house and has not spoken to Gonzalo since she left.
Appellees’ testimony was “direct evidence of the nature, duration, or severity” of their
mental anguish, “thus establishing a substantial disruption in [their] daily routine,” and evidence
that appellees suffered “a high degree of mental pain and distress that is ‘more than mere worry,
anxiety, vexation, embarrassment, or anger.’” Saenz, 925 S.W.2d at 614 (quoting Parkway Co.,
901 S.W.2d at 444); see also Bishop Abbey Homes, Ltd., 2015 WL 9167799, at *18. Finally, the
amount of mental anguish damages awarded by the trial court was approximately one-third of
appellees’ economic damages. This appears to be “reasonable compensation” for their mental
anguish. See Bunton v. Bentley, 153 S.W.3d 50, 53 (Tex. 2004) (per curiam) (concluding mental
anguish damages equal to the damage award for injury to plaintiff’s character and reputation was
reasonable compensation).
Based on this record, we cannot conclude the trial court’s award to appellees of $5,000 in
mental anguish damages was against the great weight and preponderance of the evidence. We
resolve appellants’ third issue against them.
Additional Damages
In their fourth issue, appellants complain the trial court erred by awarding appellees
additional economic and mental anguish damages because the evidence is legally and factually
insufficient to establish appellants acted knowingly or intentionally. The trial court awarded
additional economic damages of $16,600.14 and additional mental anguish damages of $5,000.
Because the trial court awarded both additional economic and mental anguish damages, we
consider whether the evidence is sufficient to support the trial court’s finding that appellants
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acted intentionally. See TEX. BUS. & COM. CODE ANN. § 17.50(b) (allowing recovery of
additional economic and mental anguish if defendant’s conduct was intentional).
The statute defines “intentionally” as:
Actual awareness of the falsity, deception, or unfairness of the act or practice, or
the condition, defect, or failure constituting a breach of warranty giving rise to the
consumer’s claim, coupled with the specific intent that the consumer act in
detrimental reliance on the falsity or deception or in detrimental ignorance of the
unfairness. Intention may be inferred from objective manifestations that indicate
that the person acted intentionally or from facts showing that a defendant acted
with flagrant disregard of prudent and fair business practices to the extent that the
defendant should be treated as having acted intentionally.
TEX. BUS. & COM. CODE ANN. § 17.45(13). Actual awareness occurs when “a person knows that
what he is doing is false, deceptive, or unfair.” McLeod, 439 S.W.3d at 652 (quoting St. Paul
Surplus Lines Ins. Co. v. Dal-Worth Tank Co., 974 S.W.2d 51, 53–54 (Tex. 1998) (per curiam)).
The trial court found Sanchez intentionally misrepresented to appellees that (1) the truck
was in proper working condition following the June 2010 repairs, (2) he would honor the
warranty of the work even after the six-month warranty period expired, and (3) the truck was in
proper working condition following the March 2011 repairs. The trial court concluded the
misrepresentation that the warranty would be honored was made with an intent to induce
appellees to return the truck to appellants for additional work. The trial court further concluded
these multiple misrepresentations, along with the totality of the evidence, showed appellants
intended to deceive appellees as to the true cost of the repair work and to induce them to pay
more money for repairs and that appellees knew the representations they made to appellees that
the truck was in proper working order were false.
The trial court also found appellants “purposefully” damaged and disabled components in
the cooling system of the truck, causing extensive further damage and that appellants’ purpose
for damaging and disabling the cooling components was to further damage the truck and induce
appellees to pay for additional repair work. The trial court concluded appellants intended to
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cause further damage to the truck by purposefully damaging and disabling parts of the cooling
system.
There was evidence Sanchez told appellees after the June 2010 and March 2011 repairs
that the truck had been repaired when the truck had not actually been repaired. Further, Gonzalo
testified Sanchez told him to bring the truck back in March 2011 and that it was not a problem it
was out of warranty. According to Farmer, the problems the truck was experiencing in June
2010 were likely due to a faulty EGR cooler. Appellants replaced the EGR cooler in March
2011, but charged appellees for the work rather than fixing it under the warranty. Although he
claimed his work did not damage the engine, Sanchez admitted that he welded plugs into ports in
the EGR cooler. Farmer testified that Sanchez’s work caused the engine to overheat, leading to
extensive damage to the engine.
We conclude the evidence was both legally and factually sufficient to support the trial
court’s findings that appellants intentionally engaged in conduct that violated the DTPA.
Accordingly, the trial court did not err by awarding additional economic and mental anguish
damages, and we resolve appellants’ fourth issue against them.
Conclusion
We resolve appellants’ first and third through tenth issues against them. We resolve
appellants’ second issue in their favor to the extent of suggesting remittitur of $900 of the
economic damages and $900 of the additional economic damages awarded by the trial court. We
resolve the remainder of appellants’ second issue against them. In accordance with rule of
appellate procedure 46.3, if appellees file with this Court within fifteen (15) days from the date
of this opinion a remittitur of $900 in economic damages and $900 in additional economic
damages, we will modify the trial court’s judgment to award appellees $15,700.14 in economic
damages, $5,000 in mental anguish damages, $15,700.14 in additional economic damages, and
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$5,000 in additional mental anguish damages, as well as the attorney’s fees awarded by the trial
court, and affirm the trial court’s judgment as modified. If the suggested remittiturs are not filed
timely, we will reverse the trial court’s judgment and remand the cause for further proceedings
consistent with this opinion. See TEX. R. APP. P. 46.3.
/Robert M. Fillmore/
ROBERT M. FILLMORE
JUSTICE
141616F.P05
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S
Court of Appeals
Fifth District of Texas at Dallas
JUDGMENT
LONE STAR ENGINE INSTALLATION On Appeal from the 191st Judicial District
CENTER, INC. AND RAFAEL SANCHEZ, Court, Dallas County, Texas,
Appellants Trial Court Cause No. DC-11-15035.
Opinion delivered by Justice Fillmore,
No. 05-14-01616-CV V. Justices Evans and Stoddart participating.
BRENDA GONZALES AND GONZALO
GONZALES, Appellees
In accordance with this Court’s opinion of this date, we suggest a remittitur in the amount
of $1,800.00 on appellees Brenda Gonzales and Gonzalo Gonzales’s claims under the Texas
Deceptive Trade Practices Act. In accordance with Texas Rule of Appellate Procedure 46.3, if
appellees Brenda Gonzales and Gonzalo Gonzales file with this Court within fifteen (15) days
from the date of this Court’s opinion in this case a remittitur in the amount of $1,800.00, we will
modify the trial court’s judgment to award appellees Brenda Gonzales and Gonzalo Gonzales
$15,700.14 in economic damages, $5,000 in mental anguish damages, $15,700.14 in additional
economic damages, $5,000 in additional mental anguish damages, $15,000 in attorney’s fees
rendered through the trial of this case, $7,500 as a reasonable attorney’s fee for this appeal, and
$5,000 in attorney’s fees if appellants Lone Start Engine Installation Center, Inc. and Rafael
Sanchez file an unsuccessful petition for review in the Texas Supreme Court, along with pre- and
post-judgment interest, on their claims under the Texas Deceptive Trade Practices Act and affirm
as modified. If the suggested remittitur is not filed timely, we will reverse the trial court’s
judgment and remand the case for further proceedings.
It is ORDERED that each party bear their own costs of this appeal.
Judgment entered this 11th day of May, 2016.
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