Jennifer Ann Webb v. C. L. Crawley Jr. and C.L. Crawley Jr., P.C.

• Court: Court of Appeals of Texas
• Decided: December 12, 2019
• Docket: 09-17-00498-CV
• Status: Published

Opinion

In The

Court of Appeals Ninth District of Texas at Beaumont ____________________

NO. 09-17-00498-CV ____________________

JENNIFER ANN WEBB, Appellant

V.

C.L. CRAWLEY JR. AND C.L. CRAWLEY JR., P.C., Appellees

_______________________________________________________ ______________

On Appeal from the 418th District Court Montgomery County, Texas Trial Cause No. 16-05-05473-CV ________________________________________________________ _____________

OPINION

This appeal arose following a trial that resulted in a take-nothing verdict on a

lawyer’s suit to collect a fee and the client’s resulting counterclaims for malpractice

and the alleged breaches of their fiduciary duties. Both parties appealed. The lawyer

complains the evidence shows he had the right to recover on his claim for unpaid

fees. The attorney’s former client argues the trial court should have found she was

1 entitled to recover on her counterclaims. We conclude the parties’ issues lack merit,

so we affirm.

I. Background

A. The Crawley Firm represents Jennifer Webb in her divorce

In August 2012, Jennifer Webb retained C.L. Crawley, Jr. and his firm, C.L.

Crawley, Jr., P.C. (the Crawley Firm) to represent her in a suit to divorce her

husband, John Webb. Crawley, as Jennifer’s attorney, sued John alleging Jennifer

wanted a divorce.

The evidence in the malpractice trial shows that Jennifer hired Crawley to

represent her in her divorce. But, as the case proceeded, the firm used Jennifer Ray,

an attorney who had an office at the firm, to do most of the legal work in the divorce.

In large part, Jennifer’s breach of fiduciary duty claims focus on her allegation that

the firm never disclosed that Ray was not an employee of the Crawley Firm. Ray

began working on Jennifer’s divorce at Crawley’s request.

The testimony shows that Ray worked for the Crawley Firm’s clients when

requested to do so by the firm. When working for the firm’s clients, Ray charged the

firm an hourly rate of less than $100 per hour based on her agreement with the firm.

The agreement allowed Ray to represent her own clients. On those matters, she set

her own rate and billed her clients without any oversight from the firm.

2 Jennifer’s fiduciary duty claims allege she thought Ray was an associate of

the Crawley Firm because no one told her otherwise. When the firm billed Jennifer

for its work, it billed Ray’s time at $200 to $250 per hour, a higher figure than the

rate Jennifer claims she would have paid Ray had she hired her without going

through the firm.

Shortly after Jennifer hired Crawley, he asked Ray to help him with Jennifer’s

divorce. Ray progressively became more and more involved in Jennifer’s case. At

one point, Jennifer let Crawley know that she preferred dealing with Ray. In April

2014, Ray represented Jennifer in a mediation to resolve the disputes in the divorce.

Several—but not all—disputes were resolved at mediation. For example, the parties

settled how to divide the parties’ marital estate. Jennifer gave John her community

interest in their home. And Jennifer agreed to be responsible for paying the debt the

couple owed the IRS for tax-years 2011 and 2013. Several other disputes—issues

involving child support and visitation—could not be resolved and were decided at

trial.

Ray appeared as Jennifer’s lawyer at a four-day trial of the divorce. When the

trial ended, the court orally pronounced its verdict. Jennifer was unhappy about the

results she achieved in mediation, at trial, and about the delays that occurred between

the trial and the date the court issued the decree.

3 In December 2014, Ray filed a motion for new trial in the divorce. The motion

sought to set aside the judgment, mainly for two reasons. First, after the trial court

signed the decree, the IRS informed Jennifer that she and John owed more for tax-

year 2011 than the amount she relied on in the mediation when she had agreed to

pay that debt. Second, Jennifer’s motion alleges that after the trial court signed the

decree, she learned John had agreed to sell the couple’s home for a higher figure

than the figure she relied on during mediation.

In January 2015, the trial court started the clock on the parties’ rights to appeal

the decree by denying the last of the parties’ motions for new trial. Neither party

appealed from the judgment, so it became final.

B. Post-divorce, the Crawley Firm defends Jennifer against John’s motion to enforce the decree

In May 2015, John filed a post-divorce motion to enforce the decree. In it, he

alleged Jennifer had not complied with her obligations under the terms of the final

decree. After Jennifer was served with John’s motion, she contacted Ray and asked

Ray to defend her in that matter. When Jennifer contacted Ray, she was still working

for the Crawley Firm. So, Ray still considered Jennifer to be a client of the Crawley

Firm. The firm, with Ray acting as Jennifer’s lead lawyer, represented Jennifer at

the hearing involving John’s motion.

4 In October 2015, John filed a second, post-divorce motion to enforce. By then,

Ray was no longer working for the Crawley Firm. Jennifer hired Ray (not Crawley

or his firm) to defend her against John’s second motion.

C. Jennifer refuses to pay the outstanding balance of the Crawley Firm’s bills

In 2015, the Crawley Firm sent Jennifer several invoices, billing her for

$13,656. When Jennifer failed to pay the invoices, Crawley sued Jennifer to collect

the balance it alleged Jennifer owed the firm. 1 Crawley’s suit, filed in February 2016,

asserts three claims, one for breach of contract, a second alleging Jennifer breached

a sworn account, and a third claiming Crawley was entitled to a quantum meruit

recovery based on the unpaid fees.

D. Jennifer files counterclaims

In late February 2017, Jennifer filed counterclaims against Crawley and the

Crawley Firm. In the counterclaims, Jennifer alleged Crawley and the Crawley Firm

committed malpractice in the divorce case and breached their fiduciary duties to her

while she was a client of the firm. Jennifer’s malpractice theory centers on the

manner the attorneys with the Crawley Firm handled her divorce. She claimed the

attorneys committed malpractice by failing to advise her of the benefits she could

have obtained had she pursued a family-violence finding against John. As to its

1 The Crawley Firm assigned its interest in Jennifer’s case to Crawley. 5 fiduciary duty claims, Jennifer alleged the Crawley Firm overbilled her for its work

and failed to disclose that Ray was not an associate of the firm while it compensated

her under an agreement favoring the firm.

In July 2017, Crawley and the Crawley Firm moved for partial summary

judgment on Jennifer’s claims. According to the motion, Jennifer’s malpractice

claim was barred by the two-year statute of limitations. And the motion argues

Jennifer could not separate her fiduciary duty claims from her malpractice claim

without violating the rule that prohibits fracturing claims.

In response to the motion, Jennifer argued several tolling theories applied to

her malpractice claim, and she suggests the doctrines extended the deadlines

governing her claims. 2 And Jennifer argued the rule against fracturing claims did not

apply to her fiduciary duty claims, which she suggests relied on separate and distinct

facts than did her claim for malpractice.

2 See BP Am. Prod. Co. v. Marshall, 342 S.W.3d 59, 67 (Tex. 2011) (“A defendant’s fraudulent concealment of wrongdoing may toll the statute of limitations after the cause of action accrues.”); Wagner & Brown, Ltd. v. Horwood, 58 S.W.3d 732, 734 (Tex. 2001) (“The discovery rule exception operates to defer accrual of a cause of action until the plaintiff knows or, by exercising reasonable diligence, should know of the facts giving rise to the claim.”); Hughes v. Mahaney & Higgins, 821 S.W.2d 154, 157 (Tex. 1991) (“[W]hen an attorney commits malpractice in the prosecution or defense of a claim that results in litigation, the statute of limitations on the malpractice claim against the attorney is tolled until all appeals on the underlying claim are exhausted.”).

6 In mid-September 2017, the trial court denied Crawley and his firm’s motion

for partial summary judgment. A week later, the parties tried the claims and

counterclaims to the bench. Seven witnesses, including Crawley, Jennifer, and Ray,

testified in the trial. When the trial ended, the trial court ordered that each party take

nothing on their claims. Both parties appealed.

II. Standard of Review

In their respective appeal and cross-appeal, both sides argue the evidence is

legally and factually insufficient to support the trial court’s take-nothing verdicts.

We note the record on appeal includes no findings of fact or conclusions of law, nor

does it show that any findings were requested.3

When findings of fact and conclusions of law are not filed or requested, we

imply all the necessary findings needed to support the trial court’s judgment, and we

will uphold the judgment on any legal theory supported by the evidence. 4 In cases

tried to the bench, the trial court acts as the factfinder. 5 As the factfinder in the case,

the trial court has the right to judge the credibility of the witnesses, weigh the

3 See Tex. R. Civ. P. 296. 4 See Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 83 (Tex. 1992). 5 McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986); see also City of Keller v. Wilson, 168 S.W.3d 802, 819 (Tex. 2005).

7 testimony, and resolve any inconsistencies and conflicts in the evidence in reaching

its verdict.6 We review the trial court’s implied findings of fact for legal and factual

sufficiency, using the same standards applied in cases tried before juries.7

Here, Crawley and his firm had the burden to prove the various claims and

affirmative defenses they raised in the trial. Likewise, Jennifer had the burden of

proof on her counterclaims. Because each party had the burden of proof on their

respective claims either for affirmative relief or raising affirmative defenses, each

side must establish the trial court’s verdict on their respective claims was incorrect

as a matter of law or show the verdict is against the greater weight and preponderance

of the evidence in the trial.8

6 Id. 7 Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex. 1996); Anderson v. City of Seven Points, 806 S.W.2d 791, 794 (Tex. 1991). 8 Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001) (citing Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983)); (explaining that a party with the burden of proof on an issue must show in the appeal that the adverse finding on its issue is against the great weight and preponderance of the evidence admitted in the trial); Raw Hide Oil & Gas, Inc. v. Maxus Expl. Co., 766 S.W.2d 264, 275-76 (Tex. App.—Amarillo 1988, writ denied) (explaining that a legal sufficiency argument, made by the party complaining about an adverse finding on which the party had the burden of proof, requires the complaining party to show the party had a right to prevail on its claim as a matter of law). 8 In a legal sufficiency review, “the final test for legal sufficiency [is] whether

the evidence at trial would enable reasonable and fair-minded people to reach the

verdict under review.” 9 In contrast, in a factual sufficiency review, we consider and

weigh all the evidence and will set it aside only if the evidence supporting the

factfinder’s finding is so weak as to make the verdict clearly wrong and unjust.10

Stated another way, we are not authorized to set aside the findings the parties are

challenging in their appeals unless the implied findings supporting the verdict are so

contrary to the overwhelming weight of the evidence that the finding being

challenged is clearly wrong and unjust. 11

III. Crawley’s Cross-Appeal

A. Crawley’s breach of contract claims

Liberally construed, Crawley argues that—as a matter of law—the trial court

was required by the evidence to find Jennifer breached her contract to pay fees.

Crawley also raises a factual sufficiency argument, suggesting the take-nothing

9 See Cain v. Bain, 709 S.W.2d 176, 176 (Tex. 1986) (per curiam). 10 Id. 11 See Plas-Tex, Inc. v. U.S. Steel Corp., 772 S.W.2d 442, 445 (Tex. 1989); Cain, 709 S.W.2d at 176. 9 verdict on his claim for fees should be overturned because the verdict is contrary to

the greater weight and preponderance of the evidence admitted in the trial.

Jennifer disagrees with both of Crawley’s arguments as they apply to his claim

for unpaid fees. She contends the evidence shows Crawley violated the billing

arrangement she had with the Crawley Firm. And she contends the evidence allowed

the trial court to decide the amount she paid the firm for its work represents a more

than reasonable fee. To support these arguments, Jennifer points to various errors in

the firm’s bills. Crawley agreed there are some errors in the bills at trial. But he does

not agree the firm overbilled Jennifer for Ray’s work by charging Jennifer more than

it paid Ray.

Under Texas law, “[a]n attorney may recover unpaid hourly fees for

professional services rendered under the usual rules of contract law.” 12 To prove a

claim for attorney’s fees, the attorney who sued must show (1) the attorney and the

client had a valid agreement obligating the client to pay fees, (2) the attorney

12 See McRay v. Dow Golub Remels & Beverly, LLP, 554 S.W.3d 702, 705 (Tex. App.—Houston [1st Dist.] 2018, no pet.).

10 tendered performance, (3) the client breached the agreement by failing to pay a

reasonable fee, and (4) damages resulted from the client’s breach. 13

“A fee is unconscionable if a competent lawyer could not form a reasonable

belief that the fee is reasonable.”14 Because attorneys are prohibited by the

Disciplinary Rules from charging or collecting an unconscionable fee, an attorney’s

remedy against a client is “subject to the prohibition against charging or collecting

an unconscionable fee.” 15 Deciding whether an attorney’s fee is reasonable is usually

a question of fact, so it generally must be resolved by the factfinder in the trial.16 To

determine whether a fee was reasonable, the factfinder—in this case the trial court—

can consider evidence relevant to the representation between the attorney and the

attorney’s client. 17 These factors include, but are not limited to, the eight factors

outlined in Arthur Andersen & Co. v. Perry Equipment Corporation.18

13 See Bank of Tex. v. VR Elec., Inc., 276 S.W.3d 671, 677 (Tex. App.— Houston [1st Dist.] 2008, pet. denied); Sullivan v. Smith, 110 S.W.3d 545, 546 (Tex. App.—Beaumont 2003, no pet.). 14 Tex. Disciplinary Rules Prof’l Conduct R. 1.04(a), reprinted in Tex. Gov’t Code Ann. tit. 2, subtit. G, app. A (Tex. State Bar R. art. X, § 9). 15 Hoover Slovacek LLP v. Walton, 206 S.W.3d 557, 561 (Tex. 2006). 16 Id. 17 Id. at 561 n.7.

11 As to his claim for fees, Crawley’s primary argument is that Jennifer failed to

present any competent evidence contradicting his testimony that the fees his firm

charged were reasonable. He argues his testimony was clear, direct, and

uncontradicted. And he concludes his testimony, together with the firm’s itemized

bills, which were also in evidence, established the reasonableness of the firm’s fees.

To be sure, Crawley was an interested witness. And speaking generally, the

uncontradicted testimony of an interested witness raises nothing more than an issue

18 The Arthur Andersen factors are

(1) the time and labor required, the novelty and difficulty of the questions involved, and the skill required to perform the legal service properly; (2) the likelihood . . . that the acceptance of the particular employment will preclude other employment by the lawyer; (3) the fee customarily charged in the locality for similar legal services; (4) the amount involved and the results obtained; (5) the time limitations imposed by the client or by the circumstances; (6) the nature and length of the professional relationship with the client; (7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and (8) whether the fee is fixed or contingent on results obtained or uncertainty of collection before the legal services have been rendered.

Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 818 (Tex. 1997) (citing Tex. Disciplinary Rules Prof’l Conduct R. 1.04(a)).

12 of fact that remains an issue to be decided by the finder of fact. 19 But Crawley points

to caselaw explaining, under the facts in that case, how the testimony of an attorney

on the reasonableness of attorney’s fees can establish the fees charged were

reasonable as a matter of law. That can occur if the testimony was “not contradicted

by any other witness, or attendant circumstances, and the same is clear, direct and

positive, and free from contradiction, inaccuracies, and circumstances tending to cast

suspicion thereon.” 20 This narrow exception applies “when the opposing party has

the means and opportunity of disproving the testimony or evidence and fails to do

so.”21 But even then, depending on the testimony in the trial, the testimony may

remain unreasonable, incredible, or allow the factfinder to question whether the

testimony can be believed. 22

In this case, the parties do not dispute that Jennifer signed a retainer agreement

allowing Crawley’s firm to represent Jennifer in her divorce. Nor do the parties

dispute that the Crawley Firm defended Jennifer in the first (but not the second) of

John’s two post-divorce motions to enforce. And no dispute exists that Jennifer

19 See Smith v. Patrick W.Y. Tam Tr., 296 S.W.3d 545, 547 (Tex. 2009). 20 Id. at 546 (cleaned up). 21 Id. at 547. 22 Id. at 547-48. 13 refused to pay the full amount of the firm’s bills or that Jennifer paid the firm around

$50,600 in fees and expenses before she terminated her relationship with the firm.

Under Jennifer’s agreement with the Crawley Firm, Jennifer agreed to pay

Crawley $350 per hour for his time, $250 per hour for the time of the firm’s

associates, and $100 for the work of the firm’s paralegals on her case. Under the

retainer agreement, Crawley had the right to adjust the firm’s hourly rates annually.

In 2012, the Crawley Firm billed for Crawley’s services and a paralegal’s

services at the hourly rates listed in the agreement. That same year, the firm billed

for Ray’s services at $200 per hour. In late-January 2013, Crawley changed the rates,

billing Jennifer $375 per hour for his services and $250 per hour for Ray’s time. The

firm continued to bill at the above rates until the firm’s and Jennifer’s relationship

ended. Given the testimony about the manner the firm used Ray on Jennifer’s case,

as well as the fact the firm’s agreement with Jennifer did not define associate, the

trial court could have found Ray was an associate of the Crawley Firm for the work

she performed on Jennifer’s behalf.

At trial, Crawley explained the firm sent Jennifer invoices about once a month.

According to Crawley, Jennifer never informed the firm she was disputing the firm’s

invoices until he sued to collect the fees she did not pay. The firm’s invoices are

itemized: they show who performed the work, the time for each task, and the hourly

14 rate the firm charged Jennifer for each person who billed her for working on the two

matters she entrusted to the firm. In his testimony, Crawley acknowledged the firm’s

invoices contained several billing errors. He asserted, however, the errors total $295.

According to Crawley, one of the errors occurred when the firm billed Ray’s time at

his hourly rate and billed a paralegal’s time at an associate’s rate. Crawley testified

Jennifer owed the firm around $13,400 in unpaid fees after reducing the firm’s bills

by the errors he acknowledged were in them. According to Crawley, the firm’s fees

were reasonable and necessary for the work the firm did on Jennifer’s files.

Crawley’s testimony was not, however, undisputed. These are just some

examples of the evidence that raised a fact issue about whether the fees were

reasonable. First, the Crawley Firm billed Jennifer for Ray’s time to draft a motion

to enforce, a motion to compel a psychological evaluation, and to review an

inventory and appraisal of the couple’s marital estate. At trial, Ray testified she never

drafted those documents. Second, Ray testified that four entries in the firm’s

February 2014 invoice showed the firm charged Jennifer for more time than she

spent on those tasks. Third, given the Andersen factors and the evidence in this trial,

the trial court had the discretion to reject Crawley’s claim that his firm’s entire fee

was reasonable.

15 We are not persuaded by Crawley’s arguments that the evidence is either

legally, or factually, insufficient to support the judgment. 23

B. Crawley’s sworn account and quantum meruit claims

To overturn the judgment denying Crawley’s recovery on his sworn account

and quantum meruit claims, Crawley argues the evidence is legally and factually

insufficient to support the trial court’s refusal to find in his favor on those claims.

But these arguments, like his arguments on his breach of contract claim, fail to

explain why the trial court could not find, as a reasonable factfinder, that Crawley

failed to prove his claim for damages.

To recover in a suit based on a sworn account, the plaintiff must show the

customer failed to pay the sworn account and prove the reasonable damages that

resulted from the customer’s failure to pay the account.24 Crawley’s claim relies on

the same evidence of damages we have already discussed. For the same reasons we

23 See El Apple I, Ltd. v. Olivas, 370 S.W.3d 757, 764 (Tex. 2012); Plas-Tex, Inc., 772 S.W.2d at 445. 24 See Ellis v. Reliant Energy Retail Servs., L.L.C., 418 S.W.3d 235, 246 (Tex. App.—Houston [14th Dist.] 2013, no pet.) (providing that a plaintiff may not recover on his sworn account claim unless “the amount of the account is ‘just,’ i.e., the prices charged are pursuant to an express agreement, or in the absence of an agreement, that the charges are usual, customary, or reasonable”).

16 have discussed when addressing Crawley’s breach of contract claim, the trial court

could have also rejected his claim that Jennifer breached a sworn account.

The trial court could also find from the evidence that Crawley failed to prove

his quantum meruit claim. “Quantum meruit is an equitable remedy which does not

arise out of a contract, but is independent of it.”25 “Generally, a party may recover

under quantum meruit only when there is no express contract covering the services

or materials furnished.” 26

In his brief, Crawley argues his quantum meruit claim is for the legal services

Jennifer received on the motion for new trial filed in her divorce case and for the

work the firm did defending Jennifer against the first of John’s post-divorce motions

to enforce. But here, the trial court could have reasonably found that $50,600 was a

reasonable fee for the firm’s work including its work on these two matters. On that

basis alone, the trial court could have refused to find in Crawley’s favor on his

quantum meruit theory of recovery. Stated another way, the trial court could

reasonably conclude Jennifer was not unjustly enriched based on her failure to pay

the full fee, given that she paid the firm a reasonable fee for its work.27

25 Vortt Exploration Co., Inc. v. Chevron U.S.A., Inc., 787 S.W.2d 942, 944 (Tex. 1990) (cleaned up). 26 Id.

17 We overrule the legal and factual sufficiency issues Crawley raised in his

cross-appeal.

IV. Jennifer’s Appeal

A. Jennifer’s malpractice claim

In her brief, Jennifer argues the judgment awarding her nothing on her

malpractice claim should be reversed. According to Jennifer, the evidence admitted

in the trial shows the Crawley Firm committed malpractice when it failed to

recommend to her that she seek a family-violence finding against John in her

divorce. Jennifer concludes that, had the firm recommended that strategy to her, she

would have taken the advice, allowing her to achieve, she claims, a better result in

her divorce.

In his response, Crawley asserts the two-year statute of limitations bars

Jennifer’s malpractice claim. 28 And Crawley contends the trial court could have

found the two-year statute of limitations applied to and barred that claim. 29 As to

27 Id. 28 See Tex. Civ. Prac. & Rem. Code Ann. § 16.003(a). 29 Id.; Apex Towing Co. v. Tolin, 41 S.W.3d 118, 120 (Tex. 2001) (explaining that in a malpractice case, “[l]imitations generally begins to run when the cause of action accrues, which we have determined means when facts have come into existence that authorize a claimant to seek a judicial remedy”). 18 limitations, Crawley suggests limitations on Jennifer’s malpractice claim began

running, at the latest, on January 8, 2015. That was the day the trial court denied the

motion for new trial, not the day the trial court’s plenary power over the decree

expired. Crawley concludes that, by the time Jennifer counterclaimed for

malpractice on February 26, 2017, the two-year statute had expired.

In response to those arguments, Jennifer suggests the trial court erred by

failing to apply several rules that can sometimes toll or extend the statutory

limitations period that applies to her claims.

B. Limitations and malpractice claims

“To prevail on a legal malpractice claim, the plaintiff must prove the

defendant owed the plaintiff a duty, the defendant breached that duty, the breach

proximately caused the plaintiff’s injury, and the plaintiff suffered damages.”30 An

action against an attorney for legal malpractice is governed by the two-year statute

of limitations. 31 Unless some doctrine applies to toll limitations, limitations begins

to run on the plaintiff’s cause of action when a wrongful act causes the plaintiff a

30 Stanfield v. Neubaum, 494 S.W.3d 90, 96 (Tex. 2016) (cleaned up). 31 See Tex. Civ. Prac. & Rem. Code Ann. § 16.003(a); Apex, 41 S.W.3d at 120. 19 legal injury. 32 This concept is commonly referred to as the legal-injury rule.33 In her

pleadings, Jennifer relied on the discovery rule, fraudulent concealment, and the

Hughes Rule to argue that Crawley’s defense of limitations did not bar her

malpractice claims.

We briefly address these doctrines. “The discovery rule delays accrual until

the plaintiff knew or in the exercise of reasonable diligence should have known of

the wrongful act and resulting injury.” 34 But the discovery rule is “a very limited

exception to statutes of limitations[,]” as it is available only “when the nature of the

plaintiff’s injury is both inherently undiscoverable and objectively verifiable.”35

Although the discovery rule is a narrow exception to limitations, the rule has been

applied to legal malpractice cases.36 Generally, questions surrounding when a

party’s cause of action accrues for the purpose of limitations are decided as a matter

32 Schlumberger Tech. Corp. v. Pasko, 544 S.W.3d 830, 834 (Tex. 2018). 33 Id. 34 Id. (cleaned up). 35 See Horwood, 58 S.W.3d at 734 (cleaned up). 36 See Willis v. Maverick, 760 S.W.2d 642, 646 (Tex. 1988); see also Apex, 41 S.W.3d at 120-21. 20 of law. 37 That said, when the discovery rule applies, questions about when the

plaintiff’s injury occurred generally entail “questions for the trier of fact.” 38

Still, the discovery rule does not require the defendant to show the injured

party knew of the actual cause of her injury or show she knew how the injury could

be cured. 39 Instead, “[o]nce a claimant learns of a wrongful injury, the statute of

limitations begins to run even if the claimant does not yet know the specific cause

of the injury[,] the party responsible for it[,] the full extent of it[,] or the chances of

avoiding it.” 40 So, what we must decide is whether the evidence allowed the trial

court to find that Jennifer had knowledge of facts that put her on notice that the

firm’s work on her divorce caused Jennifer an injury more than two years before she

sued for malpractice.

Fraudulent concealment is another tolling doctrine that operates to delay the

limitations clock from starting to run when it applies. In case of fraud, the doctrine

37 Exxon Corp. v. Emerald Oil & Gas Co., L.C., 348 S.W.3d 194, 202 (Tex. 2011) (citing Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 221 (Tex. 2003)). 38 Childs v. Haussecker, 974 S.W.2d 31, 44 (Tex. 1998). 39 PPG Indus., Inc. v. JMB/Houston Ctrs. Partners Ltd. P’ship, 146 S.W.3d 79, 93 (Tex. 2004). 40 Exxon, 348 S.W.3d at 207 (cleaned up). 21 delays the date limitations begins to run until the day “the fraud is discovered or

could have been discovered with reasonable diligence.” 41 To establish that the

doctrine applies, the party that relies on the doctrine must prove the defendant

wronged the plaintiff, knew the plaintiff had been wronged, and concealed the wrong

to prevent the plaintiff from discovering her injury. 42

The last tolling rule Jennifer relies on is known as the Hughes Rule. It is a

special tolling rule, as it applies only to legal malpractice claims. 43 In general, the

Hughes Rule tolls the starting date for limitations until the judgment in the case in

which the malpractice occurred becomes final even if the plaintiff has reason to

believe the attorney might have committed malpractice.44

Two policy reasons exist for the Hughes Rule. First, requiring clients to sue

before the judgment on the underlying case is final could force the client to take

“inherently inconsistent litigation postures in the underlying case and the client’s

malpractice case.”45 Second, deciding whether someone has a viable malpractice

41 Shell Oil Co. v. Ross, 356 S.W.3d 924, 927 (Tex. 2011) (cleaned up). 42 Marshall, 342 S.W.3d at 67. 43 Hughes, 821 S.W.2d at 157. 44 Id. 45 Apex, 41 S.W.3d at 121; Hughes, 821 S.W.2d at 156. 22 claim usually depends on the outcome the client ultimately achieves in the

underlying litigation. 46 So, even when the Hughes Rule applies, it does not

necessarily toll limitations until the client sues the attorney for malpractice.47

Instead, the rule tolls limitations only until “all appeals on the underlying claim [have

been] exhausted.”48 Consequently, we must also decide when the malpractice claim

on Jennifer’s divorce could have been exhausted.

C. Analysis of the discovery and fraudulent concealment doctrines in Jennifer’s case

Jennifer counterclaimed for malpractice on February 26, 2017. Because

Jennifer raised the discovery rule in her pleadings, Crawley had the burden to prove

that Jennifer suffered a legal injury by at least February 25, 2015, a date that is more

than two years before Jennifer filed her malpractice claim. Here, the evidence

allowed the trial court to find that Jennifer knew enough to put her on notice that she

suffered a legal injury more than two years before she filed her counterclaim for

malpractice.

46 Apex, 41 S.W.3d at 121; Hughes, 821 S.W.2d at 157. 47 Hughes, 821 S.W.2d at 157; see also Apex, 41 S.W.3d at 121-22. 48 Hughes, 821 S.W.2d at 157. 23 For instance, there was ample evidence in the trial showing Jennifer was very

unhappy with the results of her divorce even before the decree in the divorce became

final. On November 14, 2013, more than four years before Jennifer filed her

counterclaim for malpractice, she threatened to fire the Crawley Firm. In an email

Jennifer sent Ray, Jennifer explained she was unhappy with the firm’s work. The

email states:

I’m not the least bit happy with the way things are going at this point…I feel that you and [Crawley] haven’t done the job I’ve hired you to do and now I’m being penalized for it…I haven’t waivered from my initial position that the house, the kids and the dog should stay together. I’m not going to give up the house without at least attempting to fight for it…The only 2 other possibilities that I can see is to fire you and hope the judge gives me enough time to get another attorney[.]

When Jennifer discussed this email at trial, she said: “I did not feel that they were

advocating for me; that they were doing what was in my best interest; that, to be

quite honest, I didn’t feel like they cared.”

In August 2014, Jennifer sent the firm another email complaining about the

firm’s work. It states:

You kept saying just settle, just settle, just settle, you don’t want the judge to have to think about this, just settle.

So I was convinced to agree to give [John] the following:

$100,000 equity in the house (I kept saying the house was worth $399k and NO ONE would listen to me) - that’s unacceptable.

24 $30,000 from my 401k- that’s inequitable

$20,000 IRS debt was all to me despite the fact that the CPA has stated that $23,832 of tax burden was directly attributable to his withdrawal of $52,961 from HIS IRA to pay HIS attorney fees- net affect I’m paying a huge portion of his legal fees – that’s MAJOR injustice!

He’s walking away on YOUR recommendation with $150k and I’ve got nothing financially speaking except the balance of my 401k which doesn’t help [m]e put a miserable roof over my kids heads…and I can’t even get a damned divorce decree from a hearing that occurred April 25th!

I’m disillusioned and I want the damned decree done yesterday so that I can figure out how to get this undone before he sells the house and blows the proceeds.

Other evidence in the trial supports the trial court’s implied finding that

Jennifer was on notice of her legal injury more than two years before she sued for

malpractice. For example, the trial court heard that Jennifer is a licensed lawyer: she

was licensed even before she sued John for divorce.

On this record, the trial court could have reasonably determined that Jennifer

suffered a legal injury more than two years before she counterclaimed against

Crawley and his firm for malpractice. Simply put, the evidence supports the trial

court’s implied findings that the discovery rule and the doctrine of fraudulent

25 concealment did not prevent limitations from barring Jennifer’s claim for

malpractice. 49

D. Analysis-Hughes Rule

We also conclude the trial court could reasonably find that the Hughes Rule

did not save Jennifer’s malpractice claim from Crawley’s limitations defense. The

Crawley Firm completed working on Jennifer’s divorce on February 9, 2015, the

date the decree in Jennifer’s divorce became final. Under the Hughes Rule, the clock

on Jennifer’s malpractice claim started running on February 11, 2015.50

Jennifer suggests the Hughes Rule tolled limitations on her claim until the

date the Crawley Firm completed its work defending her against John’s post-divorce,

motion to enforce. But Jennifer’s malpractice theory complains about the work the

49 See Exxon, 348 S.W.3d at 209 (“Knowledge of injury initiates the accrual of the cause of action and triggers the putative claimant’s duty to exercise reasonable diligence to investigate the problem, even if the claimant does not know the specific cause of the injury or the full extent of it.”) (cleaned up). 50 Neither party appealed from the decree the trial court signed in Jennifer’s divorce. Because motions for new trial were filed after the trial court signed the decree, the trial court still had plenary power over the decree for a period of ninety days after it signed the decree on October 30, 2014. See Tex. R. App. P. 26.1(a). Thus, even if the grace period for filing an appeal applies in accounting for the Hughes Rule’s tolling doctrine, a matter we need not decide, Jennifer needed to pursue an appeal by no later than February 11, 2015. See Tex. R. App. P. 26.3. 26 firm did in Jennifer’s divorce: she did not sue Crawley or his firm over the manner

the firm defended her against John’s post-divorce, motion to enforce.

In cases involving post-divorce motions, which are motions filed after the

decree has become final, the post-divorce action is treated as a different case from

the case involving the couple’s divorce.51 Treating the cases as separate cases makes

sense, since post-divorce actions cannot alter the terms in the final decree. 52 Even

with the benefit of the Hughes Rule, Jennifer could not wait more than two years

after February 11, 2015, to sue Crawley and his firm for malpractice. But Jennifer

waited until February 26, 2017 to file her counterclaim, and by then, limitations

barred her claim. 53 We conclude Jennifer’s arguments suggesting the Hughes Rule

saved her malpractice claims lack merit.

E. Analysis-fiduciary duty claims

Last, Jennifer argues the trial court erred by rejecting her claim that Crawley

and his firm breached the fiduciary duties they owed her as a client. According to

51 See Tex. Fam. Code Ann. §§ 9.001(b), 9.006(c) (Supp.). 52 See Tex. R. Civ. P. 329b(e); Brennan v. Manning, No. 07-06-0041-CV, 2007 Tex. App. LEXIS 2838, at *6 (Tex. App.—Amarillo Apr. 12, 2007, pet. denied); Washington v. Georges, 837 S.W.2d 146, 148 (Tex. App.—San Antonio 1992, no pet.). 53 See Tex. Civ. Prac. & Rem. Code Ann. § 16.003(a)

27 Jennifer, Crawley and his firm breached their fiduciary duties to her by (1) billing

for Ray’s services without disclosing that Ray was not a payroll employee of the

firm and by (2) billing for services Jennifer either did not request, the firm failed to

complete, or which had no value. Jennifer’s fiduciary duty claims focus on her

billing relationship with the firm, while Jennifer’s malpractice claim focuses on the

advice Jennifer’s attorneys gave her during her divorce. According to Jennifer, her

fiduciary duty claims rely on a different set of facts than those she relied on to prove

her malpractice claim.

In response, Crawley argues that all of Jennifer’s claims depend on the same

facts. He concludes Jennifer should not be allowed to fracture what he claims is

essentially a malpractice claim into multiple claims when all claims are based on the

same facts.

Under Texas law, a fiduciary relationship exists between attorneys and their

clients.54 Under the rule prohibiting the fracturing of claims, a client may not sue an

attorney on a fiduciary duty claim when the client’s claims are based on the same

facts. 55

54 Meyer v. Cathey, 167 S.W.3d 327, 330 (Tex. 2005). 55 Goffney v. Rabson, 56 S.W.3d 186, 190 (Tex. App.—Houston [14th Dist.] 2001, writ denied). (“Texas law, however, does not permit a plaintiff to divide or fracture her legal malpractice claims into additional causes of action.”). 28 The record shows that Jennifer’s breach-of-fiduciary duty claims are based on

different facts than the facts she relied on to support her malpractice claim. Jennifer’s

fiduciary duty claims center on three things, (1) the firm’s failure to disclose Ray’s

employment status with the firm, (2) the manner the firm billed Jennifer for Ray’s

time, and (3) the firm’s billing practices for its work. The facts needed to prove these

claims are separate and distinct from the facts Jennifer used to claim the firm should

have advised her to seek a family-violence finding in her divorce. Stated another

way, Jennifer’s malpractice claim relates to the advice (or lack of advice) Jennifer

received in her divorce. But Jennifer’s breach of fiduciary duty claims address the

firm’s billing practices—not the firm’s advice. Because Jennifer’s claims are based

on different facts, we reject Crawley’s argument they cannot be asserted as separate

torts.

Next, we address the merits of Jennifer’s complaints about the trial court’s

failure to find in her favor on her breach of fiduciary duty claims. To prevail on a

breach of fiduciary duty claim, the plaintiff must prove (1) the existence of a

fiduciary duty, (2) breach of the duty, (3) causation, and (4) damages.56 Ordinarily,

an attorney breaches a fiduciary duty owed to a client when the attorney improperly

56 First United Pentecostal Church of Beaumont v. Parker, 514 S.W.3d 214, 220 (Tex. 2017). 29 benefits from the attorney-client relationship by, among other things, failing to

disclose conflicts of interest, placing personal interests above the client’s interests,

engaging in self-dealing, and misrepresenting facts. 57

Equitable remedies may be used to remedy such claims, and Jennifer sought

an equitable remedy here by asking the trial court to require the firm to disgorge the

fees she paid the firm. Sometimes, the prevailing party on a breach of fiduciary duty

claim may receive monetary relief without proving it suffered monetary damages.58

Upon finding that a breach of fiduciary duty occurred, a trial court may order a

forfeiture of some or all of an otherwise reasonable fee if a “clear and serious” breach

of a fiduciary duty occurred.59 When a forfeiture of fees is the remedy that has been

sought, the factfinder must resolve “whether or when the misconduct complained of

57 Gibson v. Ellis, 126 S.W.3d 324, 330 (Tex. App.—Dallas 2004, no pet.) (“The essence of a claim for breach of that duty involves the ‘integrity and fidelity’ of an attorney and focuses on whether an attorney obtained an improper benefit from representing the client.”); see also Goffney, 56 S.W.3d at 193. 58 ERI Consulting Eng’rs, Inc. v. Swinnea, 318 S.W.3d 867, 873 (Tex. 2010) (“[C]ourts may fashion equitable remedies such as profit disgorgement and fee forfeiture to remedy a breach of fiduciary duty.”); see also Burrow v. Arce, 997 S.W.2d 229, 240 (Tex. 1999) (“A client need not prove actual damages in order to obtain forfeiture of an attorney’s fee for the attorney’s breach of fiduciary duty to the client.”); Parker, 514 S.W.3d at 221 (providing that a plaintiff need not necessarily prove causation and that she suffered actual damages when seeking an equitable remedy for an attorney’s breach of fiduciary duty). 59 Burrow, 997 S.W.2d at 237. 30 occurred, the attorney’s mental state at the time, and the existence or extent of any

harm to the client.”60 The elements of a fee forfeiture claim require the trial court to

decide (1) whether the attorney committed a “clear and serious” breach of the duty

owed the client, (2) whether forfeiture or disgorgement of fees is appropriate based

on the facts of the case, and (3) if fee forfeiture is appropriate, the amount that must

be disgorged or forfeited from the attorney’s fee.61

For the purposes of Jennifer’s appeal, we will assume (without deciding) the

trial court erred by failing to find a breach of fiduciary duty occurred. In her appeal,

Jennifer argues the proper remedy for the breach required the court to order the firm

to disgorge its entire fee.

But, we have already explained why the trial court could have concluded the

amount Jennifer paid the firm for its work, $50,600, represented a reasonable fee.

While it was undisputed that the firm billed Jennifer for Ray’s work at a rate higher

than the contract rate at which Ray charged the firm, Crawley explained the reasons

that firms charge clients more than its attorneys are paid. He testified the firm’s

hourly rates include overhead, which represents the various expenses the firm

incurred in doing business. And Crawley explained the firm paid Ray for the hours

60 Id. at 246. 61 Id. 31 she billed the firm regardless of whether the firm’s clients ultimately paid the firm’s

bills.

Even more, Ray’s testimony reflects that if Jennifer had hired her directly,

Ray likely would have charged her a similar if not identical hourly rate as the one

Jennifer was charged by the firm. During the trial, Ray testified she billed her own

clients at hourly rates of between $200-$250 per hour. As the factfinder, the trial

court had the discretion to find that Jennifer would have still hired the firm to

represent her and agreed to the rates reflected in the firm’s bills even had she known

that Ray was working for the firm on an as-needed, contract basis.

As explained by the Texas Supreme Court, the remedy of forfeiture “is not

justified in each instance in which a lawyer violates a legal duty, nor is total

forfeiture always appropriate. Sometimes, violations of fiduciary duties are either

inadvertent” or do not cause a significant harm to the attorney’s client. 62 Even if we

assume Jennifer established Crawley and his firm breached the fiduciary duties they

owed Jennifer, the trial court could have nevertheless determined that Jennifer paid

the firm a reasonable fee or that she would have paid the same fee even had she

known about Ray’s contract with the firm. For these reasons, we conclude the trial

62 Id. at 241. 32 court could reasonably reject Jennifer’s theory that equity required a remedy for any

violations of the duties it owed Jennifer to bill her a reasonable fee.

We hold Jennifer failed to establish the evidence required the trial court to

render judgment in her favor on her claims. We further conclude the take-nothing

verdict rejecting Jennifer’s claims for relief is a verdict that is not contrary to the

overwhelming great weight and preponderance of the evidence. For these reasons,

we overrule Jennifer’s issues.

V. Conclusion

The trial court’s judgment on all claims reflects a reasonable resolution of the

dispute based on the evidence admitted in the trial. Neither party established a right

to prevail on their claims as a matter of law. The trial court’s judgment is affirmed.

AFFIRMED.

_________________________ HOLLIS HORTON Justice

Submitted on January 29, 2019 Opinion Delivered December 12, 2019

Before McKeithen, C.J., Kreger and Horton, JJ.