Quality Beverage, Inc. v. Medina

858 S.W.2d 8, 1993 Tex. App. LEXIS 1651, 1993 WL 196090
CourtCourt of Appeals of Texas
DecidedJune 10, 1993
Docket01-92-00959-CV
StatusPublished
Cited by9 cases

This text of 858 S.W.2d 8 (Quality Beverage, Inc. v. Medina) 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
Quality Beverage, Inc. v. Medina, 858 S.W.2d 8, 1993 Tex. App. LEXIS 1651, 1993 WL 196090 (Tex. Ct. App. 1993).

Opinions

[9]*9OPINION

HEDGES, Justice.

In this case, the trial court ruled that defendants waived their right to toll the running of prejudgment interest by failing to (1) plead tolling as an affirmative defense, and (2) adduce proper evidence of a settlement offer communicated in writing. In one point of error, appellants-defendants assert that the trial court erred in its calculation of prejudgment interest. We remand the judgment to the trial court for a determination of prejudgment interest and affirm the judgment in all other respects.

Plaintiff Teresita Medina sued defendants Willie Mays and his employer, Quality Beverage, Inc., to recover damages incurred in a rear-end collision. In 1990, plaintiff filed her original petition, alleging bodily injuries, pain and suffering, and medical expenses. Sometime before April 29, 1991, defendants offered to settle the lawsuit for $14,000. Defendants’ counsel referenced this offer in a letter to plaintiff’s counsel dated April 29, 1991. The parties agree that the offer remained open until the first day of trial.

At trial defendants conceded liability, and the issue of damages was submitted to a jury. On June 24, 1992, the trial court entered judgment on the verdict for $17,-232. The parties filed a joint motion for judgment nunc pro tunc to amend the calculation of prejudgment and postjudgment interest amounts on July 9, 1992. On July 16,1992, plaintiff filed her “Motion to Modify and/or Vacate Judgment,” asserting that the judgment nunc pro tunc was “procedurally improper” because the amendments were not clerical errors. She further urged that offset under Tex.Rev.Civ. Stat.Ann. art. 5069-1.05 (Vernon Supp. 1993), is an affirmative defense required to be pled under rule 94 of the Texas Rules of Civil Procedure. Because defendants neither pled the affirmative defense of offset in their answer nor adduced competent evidence to support such defense, they were not entitled to toll the running of prejudgment interest during the time in which their settlement offer was open. No hearing was held on plaintiff’s motion. On July 20, 1992, the trial court withdrew its judgments of June 24 and July 9 and issued both a modified judgment and an order on the motion to modify. Reciting that “the defense of Offset was waived,” the order denied defendants any offset to prejudgment interest under the statute because they had not pled offset and “no evidence was introduced in the record.”

On July 21, 1992, defendants filed a motion to modify judgment, requesting that the trial court amend its judgment to order prejudgment interest “from November 22, 1989, with credit as allowed pursuant to V.T.C.A. Article 5069-1.05 § 6(b) and 6(c).” Because the record does not reflect that the trial court ruled on this motion, we must assume that it was overruled by operation of law 75 days after the judgment was signed. Tex.R.Civ.P. 329b.

In their sole point of error, defendants assert:

The trial court committed reversible error by failing to grant defendants’ motion to modify the judgment signed July 9, 1992,1 and by granting plaintiff’s motion to modify the judgment signed July 9, 1992, and by signing on July 20, 1992, the form of modified judgment proffered by plaintiff, for the following reasons.

As “following reasons,” defendants contend: (1) that the credit for prejudgment interest on a settlement agreement is a matter of law and need not be pled; (2) that defendants fulfilled the only condition for this statutory credit by communicating their settlement offer in writing; (3) that their claim was timely presented and error preserved because it was raised while the court retained plenary power “to modify, correct, or reform the judgment”; and (4) that equity demands that the credit be applied.

[10]*10Prejudgment interest on a personal injury claim is governed by Tex.Rev.Civ.Stat. Ann. art. 5069-1.05, § 6 (Vernon Supp. 1993).2 Section 6 speaks to the issue of settlement offers:

(a) Judgments in wrongful death, personal injury, and property damage cases must include prejudgment interest. Except as provided by Subsections (b), (c), and (d) of this section, prejudgment interest accrues on the amount of the judgment during the period beginning on the 180th day after the date the defendant receives written notice of a claim or on the day the suit is filed, whichever occurs first, and ending on the day preceding the date judgment is rendered.
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(c) If judgment for a claimant is more than the amount of a settlement offer by the defendant, prejudgment interest does not include prejudgment interest on the amount of the settlement offer for the period during which the offer mag be accepted.
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(e) In order for a settlement offer to toll the running of prejudgment interest in accordance with the provisions of this section, the offer must be communicated to a party or his attorney or representative in writing. (Emphasis added.)

The parties’ respective arguments present a semantic duel that must be addressed before we can properly interpret the statute. Defendants assert that section 6(c) provides for a credit on prejudgment interest that is applicable as a matter of law. This credit requires no pleadings, they argue, because it is not an affirmative defense. Plaintiff denominates the section 6(c) interest exclusion an offset that is a matter in avoidance required to be pled under rule 94 of the Texas Rules of Civil Procedure. She argues that because defendants failed to plead this offset in their answer, they waived its application to prejudgment interest. Both these designations are inappropriate, because the statute refers to neither a credit nor an offset. Instead, section 6 provides for when prejudgment interest does or does not accrue and when a settlement offer will toll the running of prejudgment interest. Any legal significance associated with the words credit and offset, therefore, is not relevant to our analysis.

Plaintiff cites Brown v. American Transfer & Storage Company, 601 S.W.2d 931, 936 (Tex.1980), in support of her position that the issue is one of offset. In Brown, the Texas Supreme Court held that because an insurance payment is an offset, it is an affirmative defense, and the burden of pleading and proof is on the party asserting that defense. The Brown decision is neither controlling of nor analogous to the case before us because Brown did not involve a statutory provision for an offset in the calculation of the damages allowed. Rather, the Brown court reiterated a well-established rule unrelated to the statutorily prescribed calculation of prejudgment interest at issue here. The parties cite no case on point, and we have found none, that construes section 6(c) as an offset requiring rule 94 pleadings.

We therefore look to interpretation of the statute as a whole to determine whether section 6(c) requires a rule 94 pleading. A specific pleading is not a prerequisite to the award of prejudgment interest under section 6(a). The Texas Supreme Court has held that statutorily prescribed interest “may be predicated on a prayer for general relief.”

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Quality Beverage, Inc. v. Medina
858 S.W.2d 8 (Court of Appeals of Texas, 1993)

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Bluebook (online)
858 S.W.2d 8, 1993 Tex. App. LEXIS 1651, 1993 WL 196090, Counsel Stack Legal Research, https://law.counselstack.com/opinion/quality-beverage-inc-v-medina-texapp-1993.