Ellis County State Bank v. Keever

DOGGETT, Justice,

joined by HIGHTOWER, GAMMAGE and SPECTOR, JJ., concurring in part and dissenting in part.

My prior opinion of May 11, 1994, is withdrawn and the following is substituted in its place. For the sake of clarity for the reader of today’s opinion, Justice Gonzalez has adopted in full my earlier writing inasmuch as it constituted the opinion of the Court on most of the issues considered. See 37 Tex. Sup.CtJ. 783 (May 11,1994) (Parts I, II, IV, and V). I therefore join in those portions of Justice Gonzalez’s opinion for the Court, but dissent to a separate holding newly announced here, as well as the remand to the Court of Appeals.

I.

On rehearing, the majority has opted for selective enforcement of a statutory remedy. Keever argues that prejudgment interest on the punitive damages awarded in this case is mandated by the requirement that for “wrongful death, personal injury, and property damage cases.... prejudgment interest accrues on the amount of the judgment....” Tex.Rev.Civ.Stat.Ann. art. 5069-1.05(6)(a) (Supp.1994) (emphasis added). We held in C & H Nationwide v. Thompson, 37 Tex.Sup. Ct.J. 149,160 (Nov. 24,1993), that the phrase “amount of the judgment” means all of the judgment, including future damages.1 Now this unequivocal statutory command is ignored.

My preference for a plain reading of this statute is buttressed by a plain reading of a second statute. In its express prohibition of prejudgment interest on punitive damages produced by a broad range of nonintentional torts, Tex.Civ.PRAC. & Rem.Code Ann. § 41.006 (Supp.1994), the Legislature excluded intentional torts such as an assault or malicious prosecution. Section 41.006, like all of chapter 41, applies only to “action[s] in which a claimant seeks exemplary damages relating to a cause of action as defined by Section 33.001.” Tex.Civ.Prac. & Rem.Code. Ann. § 41.002(a) (Supp.1994). Section 33.001 includes claims grounded in negligence, product liability and strict liability, but none that are intentional in nature. Tex.Civ.Prac. & Rem.CodeAnn. § 33.001 (Supp.1994). The denial of prejudgment interest on punitive damages here constitutes a judicial rewriting of section 41.002(a) by extending the exclusion in section 41.006 to a category of claims to which it quite clearly does not apply.2

*804The majority’s action, moreover, conflicts with the rationale of C & H that the Legislature was not solely concerned with compensation for the lost use of money, but also intended to modify the behavior of the parties to encourage settlement. 37 Tex.Sup. Ct.J. at 160-61. While reserving the issue of whether prejudgment interest should be awarded on punitive damages not covered by § 41.006 of the Civil Practice and Remedies Code, Chief Justice Phillips, writing for the Court, noted that such a result “would be consistent with the legislative purpose of encouraging settlement.” Id. at 161 n. 1. Today’s contrary conclusion simply cannot be squared with C &H. Therefore, that portion of the judgment of the court of appeals disallowing prejudgment interest on punitive damages should be reversed.

II.

In Transportation Insurance Co. v. Morid, 879 S.W.2d 10, 31 (Tex.1994), this Court recently declared that a court of appeals “must hereinafter detail the relevant evidence” contrary to a jury verdict when upholding a punitive damages award against a challenge based on the factors set forth in Alamo National Bank v. Kraus, 616 S.W.2d 908, 910 (Tex.1981) (emphasis added). Today the “hereinafter” requirement is simply read out of Moriel and replaced with retroactivity for any “party [that] has preserved the complaint that the court of appeals failed to properly scrutinize a punitive damage award.” 888 S.W.2d at 799. But then the Court declines even to adhere to this alteration for here the Bank unquestionably failed to preserve any error on this point. The Bank’s primary contention in its motion for rehearing en banc in the court of appeals was that the punitive damage award was subject to the requirements of chapter 41 of the Texas Civil Practices and Remedies Code. After devoting six pages of its motion to this argument, the Bank added a paragraph in which, rather than “specifically refer[ring] to the Kraus factors,” 888 S.W.2d at 799, it complained of the “wholly standardless discretion” with which the jury awarded punitive damages, citing only a concurrence in Bankers Life & Casualty Co. v. Crenshaw, 486 U.S. 71, 88, 108 S.Ct. 1645, 1656, 100 L.Ed.2d 62 (1988) (O’Connor, J., concurring in part). Yet the Bank never requested trial court submission of the very factors which Texas adopted in Kraus to provide standards limiting the discretion of the jury. After failing to request that the jury be guided by the Kraus factors, the Bank complained to the court of appeals only that the size of the punitive damages verdict was the result of standardless jury discretion, and now raises the Kraus standards for the first time. Without any proper preservation of error on this issue, a remand is wholly unwarranted.

III.

The requirement of preservation of error, the need for at least some consistency in the application of our law regardless of the immediate beneficiary, and the demand that our judiciary apply the law as written by the Legislature all may have become outmoded concepts to some, but to me they remain fundamental to our system of justice.

. In construing a similar statute, California courts have held that prejudgment interest should be awarded on both compensatory and punitive damages in all personal injury cases. In Greenfield v. Spectrum Investment Corp., 174 Cal. App.3d 111, 219 Cal.Rptr. 805, 814 (1985), the California Court of Appeals held:

[Cal.Civ.Code § 3291] clearly states that "... the judgment shall bear interest at the legal rate of 10 percent...." There is only one judgment.... In light of the utilization of the term “judgment” in section 3291, both compensatory and punitive damages are encompassed therein and prejudgment interest on the punitive damages should be allowed.

See also Bihun v. AT & T Info. Sys., Inc., 13 Cal.App.4th 976, 16 Cal.Rptr.2d 787, 804 (1993) (explaining that the holding in Greenfield is ‘based ... on the statute’s provision 'the judgment shall bear interest_' (italics added.)”).

. Indeed, the legislature has determined that, with regard to punitive damages, intentional torts are different from, and should be treated differently than, negligence and strict liability cases. See Tex.Civ.Prac. & Rem.Code Ann. § 41.008 (Supp.1994):

*804Section 41.007 [limiting the amount of exemplary damages that may be properly awarded] does not apply to exemplary damages restdting from malice ... or to an intentional tort.