II Deerfield Ltd. Partnership v. Henry Building, Inc.

41 S.W.3d 259, 2001 Tex. App. LEXIS 1424, 2001 WL 226848
CourtCourt of Appeals of Texas
DecidedMarch 7, 2001
Docket04-00-00186-CV
StatusPublished
Cited by39 cases

This text of 41 S.W.3d 259 (II Deerfield Ltd. Partnership v. Henry Building, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
II Deerfield Ltd. Partnership v. Henry Building, Inc., 41 S.W.3d 259, 2001 Tex. App. LEXIS 1424, 2001 WL 226848 (Tex. Ct. App. 2001).

Opinion

OPINION

PHIL HARDBERGER, Chief Justice.

II Deerfield Limited Partnership (“Deerfield”) appeals a judgment in favor of Henry Building, Inc. (“Henry Building”) based on a jury’s finding that Deerfield breached a settlement agreement. Deer-field presents five issues in its brief, contending: (1) the evidence is legally and factually insufficient to support the jury’s finding that Deerfield breached the settlement agreement; (2) Deerfield was excused from performance by Henry Building’s breach of the settlement agreement; (3) Deerfield is entitled to a credit for monies paid to subcontractors and suppliers under the doctrine of equitable subro-gation; (4) Deerfield made a perfect tender, precluding recovery of attorney’s fees; and (5) the trial court erred in excluding evidence of the prior criminal convictions of Tom Gaubert, an employee of Henry Budding. Henry Building filed a cross-appeal, claiming that the trial court erred in reducing the jury’s verdict by $31,500. We overrule each of Deerfield’s issues but sustain the issue raised by Henry Building in its cross-appeal. Accordingly, we reverse that portion of the trial court’s judgment reducing the jury’s verdict by $31,500 and render judgment for the full amount of damages awarded by the jury, and we affirm the remainder of the trial court’s judgment.

Background

On June 6, 1997, Deerfield and Henry Building entered into a construction contract. Henry Building agreed to perform the services of general contractor in connection with the construction of a 149 unit apartment project known as Phase II Deerfield Apartments. Discord developed between the parties, resulting in a lawsuit being filed by Henry Building against Deerfield. The parties were ordered to mediation and entered into a settlement agreement on November 12,1997.

Paragraph 3 of the settlement agreement, entitled “Final Contract Payment by Deerfield,” required Deerfield to pay Henry an amount equal to (A) the contract sum ($6,650,000) multiplied by the total appropriate percentage of work completed on the project by Henry Building pursuant to the construction contract on the “Transition Date” (plus or minus all approved change orders); less (B) all payments previously made to Henry Building by Deer-field and statutory retainage. The parties agreed that the exact amount of work performed by Henry Building would be determined by an audit to be conducted by three architects: (1) the project architect *263 that had been retained by Deerfield; (2) an architect to be appointed by Henry Building; and (3) the architect that had been retained by Deerfield’s lender, Steve Sawyer. The settlement agreement stated, “The majority vote of the Architects shall be binding.” The percentage of work completed was required to take into account the cost of repair or diminished value of any work that was not performed in conformity with the contract’s plans and specifications.

Paragraph 4 of the settlement agreement, entitled “Deadline for Final Contract Payment Audit,” stated, “The Final Contract Payment Audit shall be conducted by the Architects on or about November 18, 1997 (the ‘Transition Date’).” Paragraph 5 required Deerfield to deliver the Final Contract Payment to Henry Building within ten business days after Deerfield received: (1) the Final Contract Payment Audit from the Architects; (2) an appropriate AIA Application and Certification for Payment from Henry incorporating the Final Contract Payment Audit; and (3) funding of said application by Deerfield’s lender.

In addition to the Final Contract Payment, the settlement agreement also required Deerfield to pay Henry Building its retainage, less all withholding required by law or the settlement agreement, on December 18, 1997. Deerfield also agreed to pay Henry Building the sum of $106,276.03 (the “Interim Payment”) on or before November 17, 1997, in joint checks to Henry Building and the subcontractors listed on an exhibit attached to the settlement agreement.

Henry Building agreed to use its best efforts to assign Deerfield the contracts between Henry Building and its subcontractors and suppliers. Henry Building also agreed to assign all building permits, completion reports, plans and warranties and to release all mechanics liens. Finally, Henry Building agreed to dismiss the lawsuit against Deerfield on or before the Transition Date.

After a trial on the merits, a jury found that Deerfield failed to comply with the settlement agreement and Deerfield’s failure to comply was not excused. The jury further found that Henry Building also failed to comply with the settlement agreement but Henry Building’s failure to comply was excused. The jury found that Henry Building was entitled to $110,786 in retainage and $240,738.54 for work completed and not paid for. 1 The jury further awarded Henry Building $260,000 in attorneys’ fees for preparation and trial, $25,000 in additional attorneys’ fees for an appeal to the court of appeals, and $12,500 in additional attorneys’ fees for an appeal to the Texas Supreme Court. After the jury’s verdict, the trial court granted Deerfield’s motion for judgment notwithstanding the verdict in part, ordering that the amount of damages for work completed and not paid for be reduced by $31,500 because Henry Building was not entitled to recover any amount for “general conditions.” The trial court then entered judgment in favor of Henry Building for *264 $320,024.54, plus interest, attorneys’ fees and costs.

Beeach of Settlement Agreement

A. Standard of Review

In considering a “no evidence” or legal sufficiency point raised by the party without the burden of proof, we consider only the evidence favorable to the decision of the trier of fact and disregard all evidence and inferences to the contrary. See Davis v. City of San Antonio, 752 S.W.2d 518, 522 (Tex.1988). If more than a scintilla of evidence is offered on a fact, the evidence is legally sufficient. See Kindred v. Con/Chem, Inc., 650 S.W.2d 61, 63 (Tex.1983).

When the party with the burden of proof challenges the legal sufficiency to support the jury’s failure to find in its favor, it must show that no evidence supports the failure to find and the evidence establishes the desired finding as a matter of law. Merckling v. Curtis, 911 S.W.2d 759, 763 (Tex.App.—Houston [1st Dist.] 1995, writ denied). In conducting our review, we must first determine that no evidence supports the finding based on an examination of the record for evidence supporting the finding, while ignoring all evidence to the contrary. See id. If there is no evidence to support the finding, then we examine the entire record to determine whether the contrary proposition is established as a matter of law. See id.

Only one standard of review is used in reviewing factual sufficiency challenges, regardless of whether the court of appeals is reviewing a negative or affirmative jury finding or whether the complaining party had the burden of proof on the issue. Id.

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Bluebook (online)
41 S.W.3d 259, 2001 Tex. App. LEXIS 1424, 2001 WL 226848, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ii-deerfield-ltd-partnership-v-henry-building-inc-texapp-2001.