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Varner v. Cardenas

Supreme Court of Texas
Apr 27, 2007
218 S.W.3d 68 (Tex. 2007)

Summary

holding that a party need not segregate fees for defending certain counterclaims

Summary of this case from Compass Bank v. Vey Fin., LLC

Opinion

No. 06-0212.

March 2, 2007. Rehearing Denied April 27, 2007.

Appeal from the 46th District Court, Wilbarger County, Tom Neely, P.J.

Roger Lee, Gibson Hotchkiss, Roach Davenport, Wichita Falls, TX, Lloyd Benson, Benson Benson, Inc., Frederick, OK, for Petitioner.

Daniel L. Schaap, Robert Wade King, Underwood, Wilson, Berry, Stein Johnson, Amarillo, Mike Baskerville, Pruitt Friberg Baskerville Heatly, Vernon, TX, for Respondent.

Randall K. Price, Cantey Hanger, L.L.P., Dallas, Douglas C. Jeffrey III, Vernon, TX, for Other.


We recently held in Tony Gullo Motors I, L.P. v. Chapa that a prevailing party must segregate recoverable from unrecoverable attorney's fees in all cases. 212 S.W.3d 299, 313 (Tex. 2006). The court of appeals here correctly reversed and remanded for segregation; but as it defined recoverable fees too narrowly, we modify its judgment.

The Varners sold a ranch to the Cardenases in December 1997 in return for cash and a promissory note. The note provided for ten annual installments due each December. The Cardenases paid the first installment in December 1998, but no others. In response to the Varners' suit on the note, they alleged the ranch was 180 acres less than represented. Both parties added claims against the title insurer and its agents, which the trial court severed out.

After a bench trial, the trial court granted judgment for the Varners, but reduced the balance on the note to reflect a shortfall in acreage. The court of appeals reversed, granting the Varners the full balance because the Cardenases never pleaded mistake or requested reformation of the deed. See 182 S.W.3d 380, 382-83. Neither party appeals that ruling.

The trial court also awarded the Varners $40,500 in attorney's fees for trial. The court of appeals reversed because the Varners had failed to segregate fees incurred in their suit on the note from fees incurred (1) pursuing claims against the title insurer, or (2) defending against the Cardenases' counterclaim. Id. at 383-84.

In Chapa, we reestablished the rule that attorney's fees are recoverable only if necessary to recover on a contract or statutory claim allowing them, and eliminated the exception for fees incurred solely on separate but arguably intertwined claims. 212 S.W.3d at 313. In this case, we agree with the court of appeals that fees incurred pursuing the title insurer cannot be collected from the Cardenases — suing third parties was not necessary for the Varners to collect on their note.

But we disagree that fees defending against the Cardenases' counterclaim must be segregated too. By asserting a shortfall in acreage as a defense and counterclaim, the Cardenases sought to reduce the amount collected on the note; to collect the full amount, the Varners had to overcome this defense. As their attorney's efforts to that effect were necessary to recover on their contract, they are recoverable. See id. at 311; TEX. CIV. PRAC. REM. CODE § 38.001(8).

The Varners raise two additional issues. First, the trial court denied any attorney's fees for post-judgment foreclosure or appeal, and the court of appeals affirmed because no evidence was offered regarding a reasonable fee for those services. See 182 S.W.3d at 383. The Varners cite no such evidence, but ask us to change Texas procedure to allow post-judgment fees to be determined after appeal by remand to the trial court. We decline the invitation to allow two trials on attorney's fees when one will do. See Int'l Sec. Life Ins. Co. v. Spray, 468 S.W.2d 347, 349 (Tex. 1971) (requiring proof of appellate fees in initial trial).

Second, the court of appeals reversed the trial court's assessment of pre-judgment interest on the entire note balance beginning December 15, 1998. See 182 S.W.3d at 384-85. As the note did not waive notices regarding acceleration, interest ran on unpaid installments only until acceleration occurred. See Holy Cross Church of God in Christ v. Wolf, 44 S.W.3d 562, 566 (Tex. 2001). The Varners concede the judgment was erroneous because the Cardenases did not default in 1998, but argue we should change "1998" to "1999" as a clerical error. While they make a persuasive case that acceleration itself was uncontested, they point to no pleading, evidence, or stipulation as to when acceleration occurred. Thus, we cannot determine as a matter of law when interest began to run on the entire note rather than just unpaid installments.

Accordingly, without hearing oral argument, we modify the court of appeals' judgment to the extent it required segregation of fees the Varners incurred defending against the Cardenases' counter-claim, and as modified affirm. See TEX.R. APP. P. 59.1.


Summaries of

Varner v. Cardenas

Supreme Court of Texas
Apr 27, 2007
218 S.W.3d 68 (Tex. 2007)

holding that a party need not segregate fees for defending certain counterclaims

Summary of this case from Compass Bank v. Vey Fin., LLC

holding that a party need not segregate fees for defending certain counterclaims

Summary of this case from Compass Bank v. Veytia

holding that fees incurred in successfully defending against counterclaim in order to collect full amount of note need not be segregated

Summary of this case from Vaughan v. Medina

holding that fees incurred in successfully defending against counterclaim in order to collect full amount of note need not be segregated

Summary of this case from Anglo-Dutch Petroleum Int'l, Inc. v. Case Funding Network, LP

holding that fees incurred in successfully defending against counterclaim in order to collect full amount of note need not be segregated

Summary of this case from Anglo-Dutch Petroleum International, Inc. v. Case Funding Network, LP

holding that, since the note in question did not waive notices regarding acceleration, interest ran on the unpaid installments only after acceleration occurred.

Summary of this case from Collier v. Robert Edward Hall

holding that costs of surveyor unilaterally hired by party and not ordered by court not taxable as court costs

Summary of this case from Wilson v. Whetstone

holding that fees incurred in successfully defending against counter-claim in order to collect full amount of note need not be segregated

Summary of this case from Bair Chase v. S K

concluding that to recover full amount of the note, the Varners had to overcome Cardenases' defense and counterclaim

Summary of this case from Hagan v. Pennington

concluding that fees in defending counterclaim did not have to be segregated because plaintiffs had to overcome the defense to prevail on claim

Summary of this case from Bruce v. Bruce

affirming denial of attorney fees incurred to pursue related claims against third party, but concluding that attorney's fees for defending counterclaim need not be segregated because plaintiffs were required to successfully defend that claim to fully recover on claim for which attorney's fees were authorized

Summary of this case from Cent. Austin Apts. v. UP Austin Holdings, LP

declining invitation to change Texas law under which trial courts make conditional awards of appellate attorney's fee in the trial court judgment before the parties incur any appellate fees

Summary of this case from In re Interest of C.Y.K.S.

declining to allow post-judgment fees to be determined after appeal by remand to the trial court when no evidence was offered in the trial court regarding a reasonable fee for those services

Summary of this case from Russell v. Russell

stating Chapa holds "a prevailing party must segregate recoverable from unrecoverable attorney's fees in all cases"

Summary of this case from In re Estate of Johnson

In Varner, the court declined to change Texas procedure to allow appellate fees to be determined on remand when they were not proven in the first trial.

Summary of this case from Kurtz v. Kurtz

In Varner, as here, the court of appeals reversed an award of attorneys' fees that was based on unsegregated evidence of recoverable and nonrecoverable fees.

Summary of this case from In re Lesikar

characterizing Chapa as holding that "a prevailing party must segregate recoverable from unrecoverable attorney's fees in all cases"

Summary of this case from Gallagher v. City

noting that, "[i]n Chapa, we reestablished the rule that attorney's fees are recoverable only if necessary to recover on a contract or statutory claim allowing them, and eliminated the exception for fees incurred solely on separate but arguably intertwined claims"

Summary of this case from Gallagher v. City
Case details for

Varner v. Cardenas

Case Details

Full title:Jack N. VARNER and Joyce L. Varner, Petitioners, v. Jose L. CARDENAS and…

Court:Supreme Court of Texas

Date published: Apr 27, 2007

Citations

218 S.W.3d 68 (Tex. 2007)

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