Opinion
CA 3:01-CV-0853-R
December 10, 2002
ORDER
Now before this Court are PLAINTIFF'S MOTION TO AMEND JUDGEMENT (filed September 11, 2002) and DEFENDANTS' MOTION FOR JUDGEMENT AS A MATTER OF LAW, MOTION TO ALTER OR AMEND JUDGEMENT AND MOTION FOR NEW TRIAL AND FOR REMITTITUR (filed September 20, 2002). For the reasons discussed below, Plaintiff's Motion is hereby GRANTED in part and DENIED in part, and Defendant's Motion is hereby GRANTED in part and DENIED in part.
Following a jury trial held by this Court on August 26-27, 2002, the jury returned a unanimous verdict in favor of Applewhite, finding the Defendants liable on all counts submitted to the jury. Applewhite was awarded $705,256.72 for breach of contract damages and $705,256.72 for negligence damages. On September 5, 2002, this Court entered a Final Judgement on the verdict. Applewhite asserts that the Court's Final Judgement should include prejudgement and post-judgement interest on both claims. On the other hand, Defendants argue that the Court should enter a judgement as a matter of law in Defendants' favor and/or alter or amend the Judgement in certain respects and/or grant a new trial. Thus, the problem surrounding this case appears relatively straightforward: The jury verdict awarded Applewhite the exact same amounts for his contract claim damages and for his negligence claim damages. This Court must determine whether the jury verdict awarded Applewhite a single indivisible set of damages, or whether the jury verdict awarded Applewhite separate damages for both claims. In addition, the Court must discuss prejudgement and post-judgement interest as it applies to Applewhite's judgement award.
Examining the verdict form used in this case, the Court notes that it unambiguously provides for the separate calculation of contract claim damages and negligence claim damages. The Court also notes that during the jury's deliberation, it never questioned the Court as to whether a single or separate calculation of damages was in order. Accordingly, the jury found CA and Sterling liable for breach of contract and negligence, and awarded Applewhite separate damages for each claim. There remains no confusion as to what the jury intended. However, what remains is whether Applewhite may collect a duplicate recovery.
Since this case is based on the Court's diversity jurisdiction, the Court shall decide the question pending before it under Texas law. In Medina v. Herrera, 927 S.W.2d 597, 600 (Tex. 1996), the Texas Supreme Court stated that the doctrine of election of remedies is an affirmative defense that may prevent a plaintiff from pursuing two inconsistent remedies. The purpose of the election of remedies doctrine is to preclude double or duplicate recovery for a single wrong. See Green Oaks, Ltd. v. Cannan, 749 S.W.2d 128, 131 (Tex.App.-San Antonio 1987), writ denied per curiam, 785 S.W.2d 753 (Tex. 1988). See also In re M.M.O., 981 S.W.2d 72, 78 (Tex.App.-San Antonio 1998, no writ). Thus, a plaintiff is allowed only one satisfaction for sustained injuries. Stewart Title Guar. Co. v. Sterling, 822 S.W.2d 1, 7 (Tex. 1991). The one satisfaction rule is applicable when "defendants commit technically differing acts which result in a single injury." Id.
The Court concludes that an election of remedies is warranted in this instance. For the sake of clarification, the Court emphasizes that its decision to require an election of remedies in no way signifies that the merits of Applewhite's negligence claim will be re-examined (that is, whether or not the negligence claim arose from a breach of duty which existed independently from the contract). Rather, this Court merely holds that Applewhite's damages for each claim are overlapping and duplicative, thereby resulting in double compensation. Since Applewhite has already expressed amenability to an election of remedies (namely breach of contract damages), the Court is of the opinion that Applewhite should recover damages based solely on the contract claim.
As a final order of business, this Court must determine whether interest is warranted on Applewhite's breach of contract claim. "When a federal court is sitting in a diversity case, the matter of interest on judgements is controlled by the law of the state in which the federal court is sitting." See Phillips Petroleum Co. v. Riverview Gas Compression Co., 409 F. Supp. 486 (N.D. Tex. 1976) citing Texaco, Inc., v. Lirette, 410 F.2d 1064, 1067 (5th Cir. 1969). Again, the Court must look to Texas law. Under Texas law, the Court finds that there are two distinct bases for awarding prejudgement interest: (1) an enabling statute; and (2) general principles of equity. See International Turbine Services, Inc. v. VASP Brazilian Airlines, 278 F.3d 494, 499 (5th Cir. 2002). Since breach of contract claims are not within the purview of statutory provisions, Texas common law applies. See VASP, 278 F.3d at 500. Texas common law also permits the calculation of prejudgement interest at the same rate as post-judgement interest on breach of contract damages. Id. The rate of post-judgement interest is provided by Texas statute, amounting to ten (10%) per annum. TEX. FIN. CODE § 304.003 (Vernon 1998). Texas State Publications, Texas Credit Letter, Vol. 22, No. 8 (August 20, 2002). Lastly, Texas common law indicates that prejudgement interest accrues on the earlier of: (1) 180 days after the date a defendant receives written notice of a claim or (2) the date upon which the suit is filed. See Johnson Higgins, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 530 (Tex. 1998).
It follows that prejudgement and post-judgement interest are warranted on Applewhite's breach of contract damages. Specifically, the prejudgement interest shall be calculated at the rate often percent (10%) per annum from January 10, 2001 (the 180th day after Defendants received written notice of Applewhite's claim) until September 5, 2002 (the entry date of this Court's Final Judgement). TEX. FIN. CODE § 304.003 (Vernon 1998). Kenneco, 962 S.W.2d at 530. The post-judgement interest shall be calculated at a rate often percent (10%) per annum from September 5, 2002 until December 10, 2002 (the entry date of this Court's current Order). TEX. FIN. CODE § 304.005 (Vernon 1998).
Counsel for both parties shall consult and prepare the appropriate judgement consistent with this Order, and submit it to the Court.