LG Insurance Management Services, L.P. v. Leick

378 S.W.3d 632, 2012 WL 3711078, 2012 Tex. App. LEXIS 7266
CourtCourt of Appeals of Texas
DecidedAugust 28, 2012
DocketNo. 05-10-01646-CV
StatusPublished
Cited by29 cases

This text of 378 S.W.3d 632 (LG Insurance Management Services, L.P. v. Leick) 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
LG Insurance Management Services, L.P. v. Leick, 378 S.W.3d 632, 2012 WL 3711078, 2012 Tex. App. LEXIS 7266 (Tex. Ct. App. 2012).

Opinion

OPINION

Opinion By Justice MYERS.

LG Insurance Management Services, L.P., LG Benefit Partners, Inc., Thomas J. George, and Elizabeth W. Wilmer appeal the trial court’s judgment against them and in favor of Arvid Leick following a jury trial. Appellants bring nine issues on appeal, including contentions that the trial court erred by (a) including an improper implied covenant to the parties’ agreement in the jury charge; (b) not disregarding the jury’s answer based on the implied covenant; and (c) awarding Leick his costs and attorney’s fees. Leick brings one cross-point asserting the trial court erred by granting appellants’ motion for instructed verdict on Leick’s cause of action for breach of fiduciary duty seeking actual and exemplary damages. We reverse the trial court’s award of actual damages, costs and attorney’s fees, render judgment that Leick take nothing on his claims for actual damages, and remand the issue of costs and attorney’s fees to the trial court for further proceedings.

BACKGROUND

In 2004, Leick and George formed a limited partnership, LG Insurance Management Services L.P., to sell insurance. A corporation, LG Benefits Partners, Inc., was the general partner, and Leick and George were the limited partners and the shareholders of the corporation. In 2007, the partnership merged with Wilmer’s insurance agency, and Wilmer was added as a limited partner and shareholder.

In June 2008, the limited partners and the general partner signed the Partners’ Agreement containing provisions in the event a limited partner died or otherwise separated from the partnership, including provisions in the event a partner left the partnership for reasons other than death or disability. If a partner terminated his association with the partnership voluntarily, then the agreement required the departing partner to sell his interest to the partnership or other partners according to a formula set forth in the agreement. If a partner departed involuntarily, then the agreement provided that the partner relinquished his interest in the partnership on the day of his departure. The agreement provided that no payment to an involuntarily terminated partner was required; [636]*636however, the remaining partner or partners could decide that a payment be made to the involuntarily terminated partner.1

On October 3, 2008, George and Wilmer decided to terminate Leick’s association with the partnership for a variety of reasons, including Leick’s lack of business production. They met with Leick and told him they could not be partners with him anymore and that he was no longer going to be a partner. Leick left the office, and George went to the bank and changed the signature cards for the partnership’s bank account. The next day, George went to Leick’s house and picked up all the partnership checkbooks and financial matters Leick kept there. George and Wilmer let Leick come back to the office on October 6 and 7 to “finish up some loose ends on some clients and things like that.”

On October 13, George and Wilmer offered to pay Leick the amount of money they believed he would be entitled to if he were departing voluntarily, which they calculated as $326,594.79. The next day, Leick rejected this amount, asserting George and Wilmer’s calculations included improper deductions for commissions owed to other brokers and for a debt to Insurance Marketing Services (IMS).2 Leick insisted he was entitled to $597,338.58 as a voluntarily terminated partner. On October 17, appellants, through their attorney, told Leick the deductions were appropriate, that he was not entitled to any amount under the Partners’ Agreement because he was terminated involuntarily, offered him $313,962.21, and stated that if appellants were “forced to proceed further with this matter,” then the offered amount would be reduced to $244,060.12.

[637]*637On November 12, 2008, appellants filed suit against Leick seeking a declaratory judgment that Leick was involuntarily terminated and that the agreement did not require appellants to make any payment to Leick.3 Leick answered and filed counterclaims, including claims for declaratory judgment, breach of contract, and breach of fiduciary duty. During the jury trial, the court granted appellants’ motion for directed verdict on Leick’s breach of fiduciary duty cause of action.

The jury determined that a preponderance of the evidence did not support finding that Leick voluntarily terminated his position before appellants involuntarily terminated him or that appellants failed to comply with the Partners’ Agreement when they involuntarily terminated Leick. In jury question 4, the jury found that the amount that should have been paid to Leick under the Partners’ Agreement as an involuntarily terminated partner was $326,594.79. The jury also determined the amount of the parties’ attorney’s fees.

The trial court’s judgment awarded Leick $125,194.68 and ordered the partnership and the general partner to pay Leick “$5,443,247 [sic]” per month for thirty-seven months.4 The court also awarded Leick his attorney’s fees as determined by the jury.

JURY CHARGE

In their first issue, appellants contend the trial court erred by submitting jury question 4 because it included an improper implied covenant not present in the parties’ agreement. In their second issue, appellants contend the trial court erred by not disregarding the jury’s answer to question 4.

The trial court is accorded broad discretion in formulating the charge “so long as the charge is legally correct.” Hyundai Motor Co. v. Rodriguez ex rel. Rodriguez, 995 S.W.2d 661, 664 (Tex.1999). If an instruction is improper, we will reverse if it probably caused the rendition of an improper judgment. Quantum Chem. Corp. v. Toennies, 47 S.W.3d 473, 480 (Tex.2001); Halmos v. Bombardier Aerospace Corp., 314 S.W.3d 606, 617 (Tex.App.-Dallas 2010, no pet.); see also Tex.R.App. P. 44.1(a)(1).

In question 1, the jury was asked whether Leick voluntarily terminated his association with the partnership before being involuntarily terminated, and the jury answered “No.” In question 3, the jurors were asked whether the partnership, George, and Wilmer “fail[ed] to comply with the Partners’ Agreement in connection with the involuntary termination of Leick’s association with” the partnership, and the jury answered “No.”

[638]*638The jurors were instructed to answer question 4 only if they answered “no” to question 3. Question 4 asked the jury to determine the amount that should have been paid to Leick as an involuntarily terminated partner. The trial court instructed the jury as follows:

The Court has determined that, in deciding whether a payment would be made to a partner terminated involuntarily under Section 8.03 of the Partners’ Agreement, and if so in what amount, the remaining partners were obligated to act fairly and reasonably toward the involuntarily terminated partner.

Appellants objected to this instruction, arguing that the instruction was contrary to the clear language of the contract, which left the determination of whether and how much to pay the involuntarily terminated partner in the sole discretion of the remaining partners.

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Cite This Page — Counsel Stack

Bluebook (online)
378 S.W.3d 632, 2012 WL 3711078, 2012 Tex. App. LEXIS 7266, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lg-insurance-management-services-lp-v-leick-texapp-2012.