Sjw Property Commerce, Inc. N/K/A Lease Holding, Inc. and Property Commerce Development Company N/K/A Development Holding, Inc. v. Southwest Pinnacle Properties, Inc., Jackson I Corp., Palmer Enterprises, Inc., and G.J. Palmer, Jr., Individually

Opinion

NUMBER 13-08-00268-CV

COURT OF APPEALS

THIRTEENTH DISTRICT OF TEXAS

CORPUS CHRISTI - EDINBURG

SJW PROPERTY COMMERCE, INC. N/K/A LEASING HOLDING, INC., AND PROPERTY COMMERCE DEVELOPMENT COMPANY N/K/A DEVELOPMENT HOLDING, INC., Appellants,

v.

SOUTHWEST PINNACLE PROPERTIES, INC., JACKSON I, CORP., PALMER ENTERPRISE INC., AND G.J. PALMER, JR., INDIVIDUALLY, Appellees.

On appeal from the County Court at Law No. 2 of Hidalgo County, Texas.

OPINION ON REHEARING

Before Chief Justice Valdez and Justices Benavides and Vela Opinion on Rehearing by Chief Justice Valdez

On May 28, 2010, appellants, SJW Property Commerce, Inc. (“SJW”) and Property Commerce Development Company (“PCDC”), moved this Court to rehear its original

opinion issued in this matter on April 28, 2010. No response has been filed by appellees,

Southwest Pinnacle Properties, Inc. (“SPP”), Jackson I Corp (“Jackson”), Palmer

Enterprises (“PE”), and G. J. Palmer Jr., individually. After considering SJW and PCDC’s

motion for rehearing, we deny the motion; however, we vacate and withdraw our April 28,

2010 opinion and judgment, and issue this opinion on rehearing in its place.

This case pertains to agreements between several parties for the development of

property at Jackson Palmer Crossing located near the intersection of Business Highway

83 and Jackson Road in McAllen, Texas, and at the northeast corner of 10th Street and

Trenton Road, also in McAllen. Appellants, SJW and PCDC, and appellees, SPP,

Jackson, PE, and Palmer, complain about a jury verdict in which: (1) SJW was awarded

$126,903.73 against SPP and PE and $38,400 against SPP and Jackson for damages

associated with appellees’ alleged failure to pay commissions owed for bringing tenants

to the Jackson Palmer Crossing shopping center; (2) Palmer, individually, was awarded

$709,587 in actual damages against SJW and PCDC, $376,397 and $2,000,000 in punitive

damages against PCDC and SJW, respectively, associated with Palmer’s breach of

fiduciary duty and fraud claims; (3) SJW was awarded $55,767.91 in attorney’s fees; and

(4) appellees were awarded $390,152.23 in attorney’s fees for work done at the trial court

level, $30,000 for an appeal to this Court, and $30,000 for an appeal to the Texas

Supreme Court and $100,570.23 in expenses.

By four issues, SJW and PCDC argue that: (1) SPP had no standing to bring suit

and, therefore, its inclusion in the suit did not toll the applicable limitations period; (2) the

evidence supporting the jury’s finding that SJW and PCDC intentionally interfered with

2 Palmer’s alleged contracts is legally and factually insufficient; (3) the trial court erred in

assessing exemplary damages against SJW and PCDC; and (4) the trial court erred in

awarding Palmer his attorney’s fees. By one cross-issue, appellees assert that the

evidence supporting the jury’s award for damages associated with the commissions is

legally and factually insufficient. We affirm, in part, and we reverse and render, in part.

I. FACTUAL BACKGROUND

A. The Jackson Palmer Crossing Location

In the early 1990's, Palmer first met Stanley J. Williams and Stanley Jay Williams

Jr. (“Jay Williams”), both of SJW.1 Over the course of a couple of years, Palmer and SJW

discussed the development of land that Palmer had acquired from his family near the

intersection of Jackson Road and Business Highway 83 in McAllen. Palmer and his

companies are involved in the development of various properties in the Rio Grande Valley,

while SJW facilitates the development of properties nationwide by acting as a broker and

liaison with “big box” retailers, such as Target, Best Buy, and Home Depot, which often

serve as anchor tenants for shopping centers.2 Palmer contracted with SJW to develop

the property near the intersection of Jackson Road and Business Highway 83, later named

Jackson Palmer Crossing, whereby SJW served as Palmer’s broker “in connection with the

leasing and sale of the Property.” The parties signed an “Exclusive Leasing and Sales

Listing Agreement” (the “Listing Agreement”) to memorialize the relationship. The Listing

Agreement provided that: (1) the commencement of the agreement was June 30, 1999;

(2) the agreement expired on June 30, 2000; and (3) Palmer was to pay SJW a 6% sales

1 Stanley J. W illiam s is the father of Stanley Jay W illiam s. The record reflects that Stanley Jay W illiam s, also known as Jay W illiam s, owns and controls SJW and PCDC while Stanley W illiam s serves as a retired consultant. Stanley W illiam s testified at trial that he is consulted by Jay W illiam s about deals involving SJW and PCDC “about every hour.”

2 Palm er owns and operates SPP, Jackson, and PE. 3 commission, a 4% commission for “total lease rental for the primary term (years 1-10)” and

a 2% commission “of the total rental for the primary term (years 11-20) of each lease if

Broker is the sole source of tenant.”

During the original term of the Listing Agreement, SJW allegedly secured Fashion

Bug and Staples as tenants in the shopping center at Jackson Palmer Crossing.3 The

record reflects that, on July 3, 2000, a couple days after the Listing Agreement supposedly

expired, SJW secured Factory 2-U as a tenant in the Jackson Palmer Crossing shopping

center. The record also includes a letter sent by Palmer to SJW on July 6, 2000,

requesting that the term of the Listing Agreement be extended an additional thirty days

from the June 30, 2000 expiration date. In response to Palmer’s July 6, 2000 request,

SJW sent another Listing Agreement to Palmer extending the term from June 30, 2000 to

June 30, 2001; however, this agreement was signed by Jay Williams, as president of SJW,

but it was not signed by Palmer.

C. The 10th Street and Trenton Location

1. Palmer’s Allegations

At some point during the transactions pertaining to the Jackson Palmer Crossing

shopping center, Palmer alleges that he began discussing a second development project

with Stanley and Jay Williams. The second development project was located at the

northeast corner of 10th Street and Trenton Road in McAllen (the “Trenton Project”). At

the beginning of the project, the property was primarily farmland; however, a small portion

of the land already had a gas station and a McDonald’s restaurant situated on it. Palmer

3 Additionally, pursuant to a “Developm ent Consultant Agreem ent” between Palm er and Property Com m erce Managem ent Com pany, SJW , after contracting several different “big box” retailers, was able to secure Hom e Depot as the anchor tenant at the Jackson Palm er Crossing shopping center. As a result of its efforts, SJW was paid a $74,100 developm ent fee by Palm er. The “Developm ent Consultant Agreem ent” is not disputed in this case. 4 further alleges that, when he began discussing the second development project with

Stanley and Jay Williams, he asked them to continue to act as his broker and they agreed

to do so. No contract was signed to memorialize the purported brokerage agreement.

In any event, Palmer asked his friend, Butch Schwartz, a local realtor, to begin

assembling the property at the northeast corner of 10th Street and Trenton. Schwartz was

familiar with the property because he sold portions of the tracts to the existing owners, and

he was listing the tracts for sale. Among the tract owners were B.R. Whisenant; Wayne

and Gelee Allen; Bill and Opal Baldwin; Yvonne Robinson; Harlon and Mary Robinson; and

Michael Kilgore, M.D. Most of the tract owners were descendants of the Robinson family.

Palmer states that, in 1998, SJW began providing “key services” for him in the

development of the Trenton Project. According to Palmer, SJW contacted several of the

same “big box” retailers that it had previously contacted for the Jackson Palmer Crossing

development. Among the retailers contacted by SJW on Palmer’s behalf was Albertson’s

grocery store; however, Albertson’s initially declined to participate.

Palmer notes that he regularly attends an annual convention in Las Vegas

conducted by the International Counsel of Shopping Centers (“ICSC”). Palmer recalled

that, in 1999, he was invited to the ICSC convention by Stanley and Jay Williams to

discuss the Trenton Project at Le Montrachet, a restaurant located in the Las Vegas Hilton

Hotel. Whisenant and his wife accompanied Palmer and his wife to the 1999 ICSC

convention to meet with Stanley and Jay Williams at Le Montrachet to discuss the Trenton

Project.

Palmer also recalls that Jay Williams and Clay Trozzo, a broker for PCDC and SJW

and Jay Williams’s brother-in-law, invited Palmer to go hunting in Encino, Texas, so that

the parties could discuss progress on the Trenton Project. Jay Williams and Trozzo 5 allegedly explained to Palmer that Albertson’s was again interested in being the anchor

tenant for the Trenton Project, so Steve Jarvios, an Albertson’s representative, was invited

to hunt as well. However, upon arriving, Jarvios explained to the parties that he had just

resigned from Albertson’s and that he was now working for Lowe’s Home Improvement

Centers. Despite this disclosure, the parties allowed Jarvios to stay and hunt with them.

Later, the parties discovered that Albertson’s was no longer interested in the site,

so Jay Williams and Trozzo began searching for a new anchor tenant for the property.

Eventually, Jay Williams and Trozzo were able to interest Target, a long-time client of

SJW, in the location. On March 15, 2000, Trozzo allegedly sent Schwartz and Palmer a

letter of intent, indicating that PCDC intended to purchase, on Palmer’s behalf, 13.34 acres

at the northeast corner of 10th Street and Trenton from the landowners for $2.3 million and

that Palmer would be responsible for paying SJW a 6% commission from the total sales

price. Essentially, the purchase of the tracts of land for $2.3 million would create one large

tract of land with one owner, Palmer, who would then sell the land to Target for

development of a store and possibly an attached shopping center.

On March 17, 2000, Palmer sent Trozzo a letter of intent to sell approximately 18.85

acres of land located at the northeast corner of 10th Street and Trenton to SJW for $4.9

million, plus a 6% broker’s commission for SJW. At this time, Palmer did not have any of

the land under contract; however, he apparently intended to assemble the land via earnest

money contracts to sell the land to SJW who would, in turn, sell the land to Target for

development. On March 21, 2000, Trozzo, acting as a representative of PCDC, countered

Palmer’s offer with a letter of intent to purchase 13.34 acres of the property from Palmer

for $2.6 million plus a 6% commission for SJW.

In light of his discussions with SJW and PCDC, Palmer began approaching the 6 owners of the tracts in an attempt to assemble the land through earnest money contracts.

The process of assembling land for future development is a delicate process that requires

speed, secrecy, and timing. Palmer signed earnest money contracts with the landowners.4

Most of the contracts: (1) provided for a 120-to-150-day “feasibility period”; (2) gave

Palmer the exclusive right to purchase the property; and (3) expired on April 15, 2000.5

Palmer was able to assemble all of the necessary tracts of land, except for one—a 3.7-

acre tract owned by Dr. Kilgore.6 Palmer’s failure to secure an earnest money contract

from Dr. Kilgore severely jeopardized the Trenton Project because Dr. Kilgore’s tract was

situated in such a way that prevented Palmer from selling the package of land to Target

for further development.

As negotiations proceeded in the assembly of the tracts for presentment to Target,

Stanley and Jay Williams invited Palmer to the 2000 ICSC conventions to further discuss

the Trenton Project. At the 2000 ICSC convention, Palmer updated Stanley and Jay

Williams as to the progress of his negotiations with the landowners. In these discussions,

Palmer conveyed confidential price information and acknowledged that he did not have Dr.

4 Palm er executed earnest m oney contracts with: (1) B.R. W hisenant for 1.99 acres for $467,712.50, or, in other words, $10 per square foot; (2) W ayne and Gelee Allen for 1.07 acres; (3) Bill and Opal Baldwin for 2.36 acres for $282,277 or, in other words, $2.75 per square foot; (4) Yvonne Robinson for 3.81 acres for $414,635, or, in other words, $2.50 per square foot; and (5) Harlon and Mary Robinson for 5.82 acres for $532,362, or, in other words, $2.10 per square foot. The record does not contain a contract for W ayne and Gelee Allen executed at the tim e of the others; however, W ayne testified via deposition that he and his wife did execute an earnest m oney contract with Palm er at this tim e. Moreover, testim ony was adduced at trial as to the discrepancy in the prices for each tract of land. Real estate experts testified that the price of a tract of land is dependant upon how it is situated in relation to streets or areas of high traffic. W hisenant received a higher offer than the others because his land is situated nearest to the corner of 10th Street and Trenton, a heavy traffic area, while the other tracts are situated further away from the intersection.

5 The April 15, 2000 expiration date was allegedly extended by agreem ent with the landowners and Palm er. Testim ony at trial reveals that the landowners granted Palm er an additional 180 days to determ ine the feasibility of the Trenton Project.

6 Dr. Kilgore testified at trial that Palm er and the other landowners approached him several tim es in order to coax him to sell the land to Palm er; however, Dr. Kilgore ignored m ost of the com m unications and insisted on dealing directly with Target rather than any m iddlem en or local relators and land purchasers. 7 Kilgore under contract. According to Palmer, Trozzo, after learning that Palmer was unable

to secure an earnest money contract with Dr. Kilgore, got Dr. Kilgore to sign a letter of

intent on June 6, 2000, indicating that PCDC would purchase Dr. Kilgore’s land and that

SJW would receive a 6% brokerage commission.7 However, Trozzo repeatedly informed

Palmer that Dr. Kilgore was not under contract, even though he really was, and never once

told Palmer that Dr. Kilgore intended to sell his property to SJW and PCDC.

The landowners secured by Palmer’s earnest money contracts began to worry about

whether the project would be completed as the expiration date of Palmer’s earnest money

contracts neared. Palmer contacted Trozzo to relay additional pricing information that he

had received, inform Trozzo that his earnest money contracts were expiring, and to request

a letter of intent from Dr. Kilgore indicating that he was going to sell his property to SJW

or PCDC.8 At this time, Palmer believed that: (1) SJW and PCDC were working as his

broker to get Dr. Kilgore under contract; and (2) by showing the landowners that he had

a letter of intent from Dr. Kilgore, the landowners would elect to extend their contracts with

Palmer and allow the Trenton Project to come to fruition. Jay Williams informed Palmer

that Dr. Kilgore was not under contract and that no assurances would be provided. Around

this time, several of the landowners attempted to contact Dr. Kilgore to inquire about the

status of his property so that the Trenton Project could be completed. In fact, Wayne Allen

wrote an impassioned letter to Dr. Kilgore and even visited Dr. Kilgore’s office,

masquerading as a walk-in patient in order to ask Dr. Kilgore about what it would take to

complete the deal. Wayne and the other landowners were consistently rebuffed and

ignored by Dr. Kilgore, who was apparently under contract with PCDC at this time. 7 As a part of his deal with PCDC, Dr. Kilgore was offered $1,128,204 for his 3.7-acre tract.

8 The record contains several letters from Palm er addressed to Trozzo, requesting inform ation regarding the purchasing of Dr. Kilgore’s tract of land and stating that tim e was of the essence. 8 Shortly before Palmer’s earnest money contracts expired, Trozzo approached the

landowners to inquire about whether the landowners were still under contract. Trozzo’s

efforts were memorialized in one such letter, dated September 7, 2000, to Harlon and Mary

Robinson which stated the following: “Thank you for the opportunity to meet you in

McAllen, Texas[,] last week. We did not realize your property on Trenton was currently

under contract with another party. We hope that all goes well with your transaction and

you [] reach your goals with your sale.” Palmer alleges that Trozzo, SJW, and PCDC were

aware at all times of the existence of his earnest money contracts with the landowners and

that Trozzo’s meeting with the landowners was for the purpose of inducing the landowners

to breach Palmer’s earnest money contracts so that SJW and PCDC could get the

landowners under contract and package the land for sale to Target themselves.9

On September 6, 2000, Opal Baldwin sent Palmer a letter stating the following:

“Please be advised that for various reasons, including Paragraph 5 of the Unimproved

Property Commercial Contract, Mrs. Baldwin considers the contract concerning her

property as terminated and null and void.” (Emphasis in original.) Subsequently, on

September 8, 2000, Harlon and Mary Robinson sent Palmer a similarly-worded letter

terminating their contract with Palmer. On September 13, 2000, Trozzo, on behalf of

PCDC, sent Palmer a letter requesting proof that Palmer had “control of the Property” by

providing PCDC with copies of “receipted contracts with the title company.” Trozzo also

noted that Palmer’s failure to provide copies of the contracts would result in SJW and

9 W ayne Allen testified via deposition that he and the other landowners were approached by SJW and PCDC while the landowners were still under contract with Palm er. The landowners were encouraged by SJW and PCDC to break their contracts with Palm er; however, several of the landowners refused to do so because they did not desire to do business with SJW and PCDC. Dr. Kilgore testified via deposition that he was approached by Trozzo, who represented that he was from Target rather than SJW or PCDC. Dr. Kilgore had previously inform ed all parties that he preferred to deal directly with Target representatives. In any event, Dr. Kilgore recalled a conversation he had with Trozzo where Trozzo noted that Palm er was trying to assem ble the tracts of land for developm ent but Trozzo wanted to get Dr. Kilgore under contract and wait until Palm er’s earnest m oney contracts expired so that SJW and PCDC could develop the land them selves. 9 PCDC dealing directly with the landowners.

After receiving the various termination letters and Trozzo’s September 13, 2000

letter, Palmer believed that “he had been betrayed.” Thus, in response to Trozzo’s

September 13, 2000 letter, Palmer sent Trozzo, SJW, and PCDC a letter stating that: (1)

they had tortiously interfered with Palmer’s earnest money contracts with the landowners;

(2) as a result of the interference and accompanying delay in the development process,

“[y]our [Trozzo, SJW, and PCDC] actions have tarnished my reputation as a developer in

the community and have resulted in substantial financial loss to me”; and (3) “[y]our letter

of September 13, 2000 appears to be nothing more that a self-serving attempt to disguise

the damage you have caused.” In response to SJW and PCDC’s purported actions,

Palmer began to withhold commissions from Jackson Palmer Crossing, thinking that it was

not fair to pay the commissions when SJW and PCDC had betrayed him. Palmer also

refused to renew the Listing Agreement he had with SJW at Jackson Palmer Crossing.

Now believing that SJW and PCDC were acting counter to his interests, Palmer

hired Trammell Crow Company as his new broker on the Trenton Project, and they

convinced the landowners to renew their earnest money contracts with Palmer in hopes

of packaging the land to Target or another anchor tenant.10 However, shortly thereafter,

Target, Home Depot, and SJW allegedly pressured Trammell Crow to stop acting as

Palmer’s broker. Target then instructed the landowners to deal directly with SJW and

PCDC, rather than Palmer.

Later, Jarvios, now with Lowe’s, informed the landowners that Lowe’s would be

interested in developing the site. Using this information, Palmer was able to secure

another 180-day contract with the landowners. At some point, Jarvios allegedly received

10 During its representation of Palm er, Tram m ell Crow sent a letter to Schwartz regarding the Trenton Project, which stated: “Furtherm ore, in the presence of Hom e Depot, Jay W illiam s assured us [Tram m ell Crow] that he would assign the Doctor’s contract to us if Jay Palm er pays to Property Com m erce com m issions allegedly owed to them for two (2) deals that were com pleted at Jackson Palm er Crossing.” 10 an “aggressive and irate” phone call from a Target representative attempting to prevent

Lowe’s from developing the site. Jarvios proposed that Lowe’s and Target work together

to develop the site; however, SJW and PCDC could not be involved because SJW and

PCDC also represented Home Depot, one of Lowe’s competitors. Target did not respond

to Jarvios’s proposal.

In May 2001, Stanley Williams called Palmer and proposed a meeting to try to work

out the problems associated with the Trenton Project. Palmer agreed to meet as long as

Trozzo and Jay Williams were not involved in the deal because Palmer believed that

Trozzo and Jay Williams were the main perpetrators of the earlier deception. Palmer’s

sentiments regarding Trozzo and Jay Williams were also echoed by the landowners. After

meeting with Stanley Williams, Palmer agreed to assign the landowners’ property that he

had under contract to Target for no profit. In exchange for this assignment, Palmer

received a conditional reciprocal easement agreement (“REA”). The REA was conditioned

on Palmer purchasing at least ten acres of land to the north of the Trenton Project owned

by Eugene J. Kayser Jr. within twelve months. At the time of the negotiations with Stanley

Williams, Palmer notes that he was already in the midst of negotiations with Kayser to

develop the tract of land adjoining the Trenton Project. The REA was valuable to Palmer

because it allowed for traffic to cross parts of the Target property to access land to the

north of the Trenton Project, where the Kayser tract is situated. Without the REA, Palmer

would have had a very difficult time marketing and developing the Kayser tract, as access

to the land would be impeded. Palmer alleges that Stanley Williams knew that the REA

was crucial to Palmer’s development of the Kayser tract and that Stanley Williams used

the REA as leverage to obtain the assignment of the landowners’ property with no markup.

Palmer later discovered that, despite his insistence on Trozzo not being involved in 11 the renewed negotiations with SJW and PCDC, Trozzo was indeed involved in the

transactions and that Trozzo’s involvement had been hidden from Palmer from May to

December 2001. Trozzo, on behalf of SJW, attempted to purchase the Kayser tract for $3

million, which was significantly more than the $1,960,000 bid Palmer had previously made.

Palmer believed that SJW’s $3 million bid for the Kayser tract was an attempt by SJW to

bid up the price of the Kayser tract to prevent Palmer from purchasing the tract and,

therefore, rendering the REA meaningless. In addition, Palmer found out that Stanley and

Jay Williams formed a single-asset entity, McAllen Shopping Center, Ltd., and acquired a

portion of the Trenton Project for their own development. This portion of the Trenton

Project was eventually sold by SJW to Chick-Fil-A.11

In the end, the Trenton Project was developed with Target being the anchor tenant.

Target purchased the property for a sum significantly less than what had been previously

offered. As a result of SJW and PCDC’s actions, Palmer alleges that he was prevented

from making a profit on the assembly of the land tracts for Target and that SJW and PCDC

bid up the price of the Kayser tract so as to prevent the negotiated REA from having any

value whatsoever.

2. The Trenton Project According to SJW and PCDC

SJW and PCDC, on the other hand, allege that they first learned about the

development opportunities at the northeast corner of 10th Street and Trenton in 1999 or

2000, when they drove by the property and saw Schwartz’s sign listing the property for

sale. After viewing Schwartz’s sign listing the property for sale, SJW and PCDC made

several inquires and offers to purchase the land. In particular, SJW and PCDC obtained 11 Palm er referenced an em ail in his testim ony from Charles Thom pson, an architect for SJW , regarding the Trenton Project. In his em ail, Thom pson instructed Larry Heim er, a civil engineer doing work at the Trenton Project, to: “Do not send Jay Palm er a plan showing the lease space next to Target and/or the Chick-[F]il-A plan. [SJW ] Property Com m erce does not want him having that inform ation.” 12 a letter of intent from Dr. Kilgore regarding the sale of his land to SJW and PCDC. SJW

and PCDC then began to assemble the properties on their own for future sale to Target.

SJW and PCDC argue on appeal that PCDC was never a party to any of the transactions

in question and that, because the record does not contain a writing evidencing a brokerage

agreement between SJW and Palmer similar to the Jackson Palmer Crossing

development, neither SJW nor PCDC were Palmer’s broker for Palmer’s Trenton Project.

Instead, SJW and PCDC recalled that they competed with Palmer in developing the

northeast corner of 10th Street and Trenton. However, the record reflects that Trozzo, Jay

Williams, and Stanley failed to explicitly tell Palmer that neither SJW nor PCDC were

Palmer’s broker in the development of Palmer’s Trenton Project. SJW and PCDC also

allege that the earnest money contracts Palmer had with the landowners were null and void

because Palmer failed to deposit earnest money with the title company.12 Moreover, SJW

and PCDC argued at trial that because the record did not contain a copy of all the

contracts Palmer had with the landowners, Palmer could not recover any damages on the

contracts not admitted into evidence. Furthermore, throughout the course of this case,

SJW and PCDC have denied any wrongdoing regarding the Trenton Project and attributed

Opal Baldwin’s and Harlon and Mary Robinsons’ termination of their contracts with Palmer

to coincidence.

II. PROCEDURAL HISTORY

On December 2, 2003, SJW filed its original petition against SPP, Jackson, PE, and

12 The record reflects that Palm er tendered earnest m oney for the contracts contained in the record; however, the contracts do not reflect that the title com pany received the earnest m oney. In other words, the earnest m oney does not appear to be “receipted” by the title com pany. Palm er testified that he provided Schwartz with the earnest m oney that was to be provided to the title com pany. Schwartz noted that he received the earnest m oney, thus corroborating Palm er’s testim ony regarding the earnest m oney; however, Schwartz could not recall as to why the earnest m oney was not deposited with the title com pany. In any event, the landowners never sought to term inate their contracts with Palm er until they were approached by SJW and PCDC. 13 Palmer, individually, (collectively the “Palmer companies”) alleging a breach of contract

action for commissions owed under the “Listing Agreement” pertaining to properties located

at Jackson Palmer Crossing. In this filing, SJW argued that Jackson and PE were both

assigns of SPP and that Palmer was the owner of all of the entities and, therefore, liability

was attributable to all of the named entities. On February 9, 2004, the Palmer companies

filed an original answer and counterclaim: (1) denying the allegations made by SJW in its

original petition; (2) asserting various affirmative defenses, including Jackson, PE, and

Palmer were not liable in the capacity in which they were sued; and (3) asserting

counterclaims for breach of fiduciary duty, malicious interference with contract and

prospective business relations, and fraud against SJW pertaining to an implied agency

relationship regarding transactions at the Trenton Project.

SJW filed its first amended petition on May 13, 2004, asserting the same causes

of action as contained in its original petition and adding an additional common-law fraud

cause of action against Palmer, individually. Subsequently, on November 8, 2005, the

Palmer companies filed their first amended answer and counterclaim: (1) generally

denying the allegations contained in SJW’s first amended petition; (2) asserting various

affirmative defenses, including laches; (3) arguing, by verified plea, that Jackson was not

liable in the capacity it was sued; (4) requesting attorney’s fees pursuant to article 6.04 of

the Listing Agreement13; (5) invoking the statutory damage caps enumerated in chapter 41

of the civil practice and remedies code; (6) re-asserting their breach of fiduciary duty,

13 Article 6.04 of the Listing Agreem ent provides, as follows:

6.04 If either party hereto shall institute any action or proceeding against the other party hereto relating to this Agreem ent, the successful party in such action or proceeding shall be entitled to recover from the unsuccessful party all fees and expenses incurred in connection therewith, including court costs, reasonable attorneys’ fees and related expenses. 14 tortious interference with contract and prospective business relations, and fraud causes

of action and noting that SJW owed Palmer “fiduciary duties of loyalty, good faith, integrity

of the strictest kind, fair and honest dealing, and the duty not to advance self-interest”; (7)

substituting Palmer as “Counter-Plaintiff”; and (8) requesting exemplary damages.

On June 23, 2006, the Palmer companies filed a second amended answer and

counterclaim, adding PCDC as a third-party defendant and asserting an additional

counterclaim against both SJW and PCDC for negligent misrepresentation. On September

11, 2006, the Palmer companies filed their third amended answer and counterclaims,

arguing that: (1) because the Listing Agreement failed to identify the property with

sufficient certainty, the Listing Agreement does not sufficiently establish that SJW and

PCDC were owed commissions; and (2) because SJW and PCDC breached its duties of

loyalty and good faith owed to the Palmer companies, SJW and PCDC’s claims were

barred.

SJW filed its second amended petition on September 15, 2006: (1) re-asserting its

breach of contract and common-law fraud causes of action against the Palmer companies;

(2) alleging that the actions of the Palmer companies amounted to civil conspiracy; and (3)

requesting exemplary damages. Also on September 15, 2006, SJW and PCDC filed

separate original answers: (1) denying the assertions contained in the Palmer companies’

pleadings; (2) asserting various affirmative defenses, including limitations; and (3)

requesting attorney’s fees pursuant to article 6.04 of the Listing Agreement.

Later, on November 28, 2006, SJW filed its third amended petition, adding a

statutory fraud cause of action against the Palmer companies. On February 13, 2007, the

Palmer companies filed their fourth amended answer and counterclaims, which mirrored

their third amended answer and counterclaims and also specifically denied that SJW was 15 entitled to commissions related to the lease to Factory 2-U. SJW and PCDC filed a second

amended original answer on April 10, 2007.

On April 16, 2007, the trial on this matter commenced. After SJW and PCDC rested

their case-in-chief, the trial court granted a directed verdict as to SJW and PCDC’s

common-law fraud claim, leaving only SJW and PCDC’s breach of contract claim and the

Palmer companies’ counterclaims to be determined by the jury.14 After several days of

testimony and the admission of hundreds of exhibits, the jury entered a split verdict. In

particular, the jury concluded the following:

THE COURT: The first—Question No. 1: Did the following agree to pay SJW Property Commerce, Inc. a commission to [the] Staples lease? Southwest Pinnacle [Properties], Inc., yes; Palmer Enterprises, Inc., yes.

Question No. 2: Did the following agree to pay SJW Property Commerce, Inc. a commission to [the] Fashion Bug lease? A. Southwest Pinnacle Properties, yes; Jackson I Corp., yes.

[Question No. 3:] Did Southwest Pinnacle Properties agree to pay SJW Property Commerce, Inc. a commission on Factory 2-U lease? Answer: No.

Did the following fail—Question No. 4: Did the following fail to comply with their agreement regarding the commission to Staples lease Southwest Pinnacle Properties? Answer: Yes. Palmer [Enterprises], Inc., yes.

Question No. 5: Did the following fail to comply with [the] agreement regarding commission on the Fashion Bug Lease? Southwest Pinnacle Properties, yes; Jackson I Corp., yes.

Was—Question No. 7: Was Southwest Pinnacle Properties, Inc.’s failure to comply excused? Answer: No.

14 The record reflects that SJW and PCDC abandoned their civil conspiracy cause of action against SPP, Jackson, PE, and Palm er. Moreover, SJW ’s statutory fraud claim was dism issed earlier in the case. 16 Question No. 8: Was Palmer Enterprise[s], Inc.’s failure to comply excused? Answer to the Question No. 8: No.

Was—Question No. 9: Was Jackson I Corp.’s failure to comply excused? Answer: No.

Was G.J. Palmer’s failure to comply excused—Question No. 10. Answer: No.

What sum of money if paid—if any, if paid now in cash would fairly and reasonably compensate SJW Property Commerce for damages, if any, that were proximately caused by such conduct? Past commission owed to Staples lease, $128,903.72; commission owed to Fashion Bug lease, $38,400.

Question No. 12: Did a relationship of trust and confidence exist between Southwest—SJW Property Commerce, Inc. and G.J. Palmer as to North 10th & Trenton? Answer: Yes.

Question No. 13: Did [SJW] Property Commerce, Inc. comply with its fiduciary duty to G.J. Palmer, Jr.? Answer: No.

[Question No. 14:] Did [SJW] Property Commerce, Inc. intentionally interfere with G.J. Palmer’s earnest money contracts, if any? A. [W]ith Opal Baldwin, yes; B. [W]ith B.W.—B.R. Whisenant, yes; C. [W]ith Wayne Allen and [Gelee] Robinson Allen, yes; D. [W]ith Yvonne Robinson, yes; E. [W]ith Harlon and Mary Robinson, yes; and F. [W]ith Eugene Kayser[, yes].

Question No. 15: Did [SJW] Property [Commerce] interfere because it has a good-faith belief it has a right to do so? A. [N]o; B. [N]o; C. [N]o; D. [N]o; E. [N]o; F. [N]o.

....

[Question No. 18:] What date should G. Palmer in the exercise of reasonable diligence have discovered the interference of the contracts of SJW Property Commerce? Answer with was [sic] a date in the back. 17 August 8th, 2000.

Question No. 19: Did [SJW] Property Commerce, Inc. commit fraud against G.J. Palmer, Jr.? Answer: Yes.

....

Twenty-one: By what date should G. Palmer in [the] exercise of reasonable diligence have discovered the fraud of [SJW] Property Commerce, Inc.? Answer: September 8, 2000.

[Question No. 22:] What sum of money, if paid now in cash, would fairly and reasonably compensate G.J. Palmer, Jr. for his damages, if any, that were proximately caused [by SJW Property Commerce’s] conduct? A. The lost profit from the Robinson tract deal, answer $376,397. B. [L]ost profits from the rental revenue delay $207,926. And lost profit from the property sale delay $125,264.[15]

Question No. 23: Do you find by clear and convincing evidence that the harm to G.J. Palmer, Jr. resulted from malice [regarding PCDC’s purported actions]? Answer: Yes.

[Question No. 24:] What sum of money, if paid now in cash, would—should be assessed against Property Commerce Development [PCDC] and awarded to G.J. Palmer as exemplary damages, if any, for the conduct found in response to a Question No. [2]3? And it’s $376,397.

Question No. 25: Do you find by . . . clear and convincing evidence that the harm to G.J. Palmer, Jr. resulted from malice [regarding SJW’s purported actions]? Answer: Yes.

Number 26: What sum of money, if any, if paid

15 The sum of the figures m entioned in the jury’s answer to question num ber 22 is $709,587. The trial court, in its final judgm ent, stated that SJW and PCDC were jointly and severally liable for the $709,587 in actual dam ages awarded by the jury in question num ber 22. See Kinzbach Tool Co., Inc. v. Corbett-W allace Corporation, 138 Tex. 565, 160 S.W .2d 509, 514 (1942) (holding that wrongdoers m ay be held jointly and severally liable if the victim establishes that only one breached a fiduciary duty owed to the victim and that the other knowingly participated therein); see also Jung Fu Chien v. Chen, 759 S.W .2d 484, 487 (Tex. App.––Austin 1988, no writ) (sam e). 18 now in cash should be assessed against [SJW] Property Commerce, Inc. and awarded to G.J. Palmer, Jr. as exemplary damages, if any . . . . Answer: $2 million dollars.

At the conclusion of the trial, the parties filed various post-judgment motions,

including motions to disregard various portions of the jury’s verdict and a motion

notwithstanding the jury’s verdict. These motions were ostensibly denied when the trial

court entered its final judgment adopting the jury’s findings on February 7, 2008.16 On

March 6, 2008, SJW filed a motion for new trial, a motion to modify the judgment, and a

motion for remittitur, asserting, among other things, that: (1) the evidence supporting the

damages awarded to Palmer was insufficient; (2) the amount of attorney’s fees awarded

to Palmer’s attorneys required modification; and (3) limitations barred all claims brought

by the Palmer companies. In response to SJW’s March 6, 2008 motions, the Palmer

companies filed their own motion for new trial, arguing that the evidence supporting the

jury’s verdict as to the commissions owed to SJW was insufficient. SJW’s March 6, 2008

motions and the Palmer companies’ motion for new trial were overruled by operation of

law. See TEX . R. CIV. P. 329b(c). SJW and PCDC filed a notice of appeal, and the Palmer

companies responded by filing a notice of cross-appeal.

III. STANDING AND TOLLING OF THE LIMITATIONS PERIOD

In their first issue, SJW and PCDC assert that SPP did not have standing to assert

its February 9, 2004 counterclaims against SJW and PCDC because SPP “was not

damaged with respect to any actions at 10th Street and Trenton Road.” SJW and PCDC

further assert that even if SPP did have standing, its causes of action do not constitute a

16 In its February 7, 2008 final judgm ent, the trial court noted that the parties had subm itted affidavits with the attorney’s fees requests and subsequently awarded SJW $55,767.91 in attorney’s fees and the Palm er com panies $289,582 in attorney’s fees and $100,570.23 in expenses. 19 counterclaim and are, instead, a third-party action that is barred by limitations. SJW and

PCDC also argue that SPP’s counterclaim did not arise out of SJW’s claim for

commissions. The Palmer companies counter by arguing that SPP had standing to sue

and that limitations did not bar the Palmer companies’ counterclaims because SPP was

an aggrieved party and the Palmer companies’ counterclaims were brought in accordance

with sections 16.068 and 16.069 of the civil practice and remedies code. See TEX . CIV.

PRAC . & REM . CODE ANN . §§ 16.068, 16.069 (Vernon 2008).

A. Applicable Law

1. Standing and Capacity

A plaintiff must have both standing and capacity to bring a lawsuit. Austin Nursing

Ctr., Inc. v. Lovato, 171 S.W.3d 845, 848 (Tex. 2005) (citing Coastal Liquids Transp., L.P.

v. Harris County Appraisal Dist., 46 S.W.3d 880, 884 (Tex. 2001)). The standing inquiry

“focuses on whether a party has a sufficient relationship with the lawsuit so as to have a

‘justiciable interest’ in its outcome, whereas the issue of capacity ‘is conceived of as a

procedural issue dealing with the personal qualifications of a party to litigate.’” Id. (quoting

6A CHARLES ALAN W RIGHT , ARTHUR R. MILLER , & MARY KAY KANE, FEDERAL PRACTICE AND

PROCEDURE: CIVIL 2D § 1559, at 441 (2d ed. 1990)). A plaintiff has standing when he is

personally aggrieved, regardless of whether he is acting with legal authority; a party has

capacity when it has the legal authority to act, regardless of whether it has a justiciable

interest in the controversy. See Nootsie, Ltd. v. Williamson County Appraisal Dist., 925

S.W.2d 659, 661 (Tex. 1996) (holding that the standing doctrine requires that there be (1)

“a real controversy between the parties,” that (2) “will be actually determined by the judicial

declaration sought”). The complained-of injury “must be concrete and particularized, actual

or imminent, not hypothetical.” DaimlerChrysler Corp. v. Inman, 252 S.W.3d 299, 304-05 20 (Tex. 2008) (footnotes omitted); see Tex. Lottery Comm’n v. Sci. Games Int’l, 99 S.W.3d

376, 380 (Tex. App.–Austin 2003, pet. denied) (holding that “[t]o establish standing, one

must show a justiciable interest by alleging an actual or imminent threat of injury peculiar

to one’s circumstances and not suffered by the public generally”); see also Elizondo v. Tex.

Natural Res. Conservation Comm’n, 974 S.W.2d 928, 932 (Tex. App.–Austin 1998, no

pet.) (citing Warth v. Seldin, 422 U.S. 490, 498-99 (1975) (noting that the general standard

for determining whether plaintiff has standing is whether she has such a personal stake in

the outcome of the controversy as to warrant invocation of the court’s jurisdiction and to

justify exercise of the court’s remedial powers on her behalf)). Furthermore, standing is

implicit in subject-matter jurisdiction and cannot be waived. See Lovato, 171 S.W.3d at

849; see also Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 443 (Tex. 1993).

B. Discussion

1. SPP’s Standing to Bring Its February 9, 2004 Counterclaims

On appeal, SJW and PCDC first argue that there is no evidence in the record

demonstrating that SPP was involved in any negotiations for the purchase of property at

the northeast corner of 10th Street and Trenton Road; therefore, because the Palmer

companies’ counterclaims centered on SJW and PCDC’s purported conduct regarding

Palmer’s Trenton Project, SPP did not have a justiciable interest in the matters asserted

in the Palmer companies’ counterclaims. The Palmer companies counter by arguing that

they timely filed their counterclaims and that sections 16.068 and 16.069 of the civil

practice and remedies code allowed for the substitution of Palmer as the aggrieved party

in place of SPP. See TEX . CIV. PRAC . & REM . CODE ANN . §§ 16.068, 16.069. Moreover, the

Palmer companies construe SJW and PCDC’s standing argument as a capacity issue that

was waived by SJW and PCDC’s failure to file a verified plea. 21 As mentioned earlier, SJW filed its original petition against the Palmer companies

on December 2, 2003. Subsequently, on February 9, 2004, the Palmer companies filed

their original answer and counterclaims against SJW. However, the Palmer companies

identified SPP as the sole “Counter-Plaintiff” in their original counterclaims. In their first

amended counterclaims filed on November 8, 2005, the Palmer companies amended their

counterclaims to replace SPP with Palmer as “Counter-Plaintiff.” No new causes of action

were asserted in the Palmer companies’ November 8, 2005 amended counterclaims.

SJW and PCDC correctly state that SPP was not involved in any negotiations

regarding the development of Palmer’s Trenton Project, which is the basis of the Palmer

companies’ counterclaims. SJW and PCDC argue that SPP was a proper party to the

Jackson Palmer Crossing dispute but not to the Trenton Project dispute. However, after

viewing the entire record, we find that the claims at issue in this case are inextricably

intertwined so as to constitute the same transaction or occurrence. Thus, even though the

Palmer companies first named SPP as the “Counter-Plaintiff” in their counterclaims, we

find that SPP had a justiciable interest in this matter and, therefore, had standing.

In arriving at our conclusion, we first determine what constitutes a “transaction.” To

determine whether a set of facts constitutes a “transaction,” we employ the logical

relationship test, which examines whether the essential facts on which the claims are

based are significantly and logically relevant to both claims. Wells v. Dotson, 261 S.W.3d

275, 281 (Tex. App.–Tyler 2008, no pet.) (citing Cmty. State Bank v. NSW Invs., 38 S.W.3d

256, 258 (Tex. App.–Texarkana 2001, pet. dism’d w.o.j.) (considering the term

“transaction” in determining whether a counterclaim was compulsory); see Smith v.

Ferguson, 160 S.W.3d 115, 120 (Tex. App.–Dallas 2005, pet. denied). “Under this test,

a transaction is flexible, comprehending a series of many occurrences logically related to 22 one another.” Wells, 261 S.W.3d at 281 (citing NSW Invs., 38 S.W.3d at 258; Klein v.

Dooley, 933 S.W.2d 255, 259 (Tex. App.–Houston [14th Dist.] 1996), rev’d on other

grounds, 949 S.W.2d 307 (Tex. 1997)). “There is no logical relationship when none of the

same facts are relevant to both claims. However, whenever the same facts, which may or

may not be disputed, are significant and logically relevant to both claims, the ‘logical

relationship’ test is satisfied.” Jack H. Brown & Co. v. Nw. Sign Co., 718 S.W.2d 397, 400

(Tex. App.–Dallas 1986, writ ref’d n.r.e.).

Here, Palmer testified that the alleged brokerage relationship between himself and

SJW arose as a result of their dealings at the Jackson Palmer Crossing shopping center

where SPP was a signatory to the Listing Agreement. Several witnesses testified that SJW

acted as Palmer’s broker at both the Jackson Palmer Crossing project and the Trenton

Project. Furthermore, even SJW admits that it and Palmer engaged in numerous

conversations regarding the development of both sites at around the same point in time.

Finally, we find it particularly noteworthy that Jay Williams informed Trammell Crow,

Palmer’s one-time broker, that “if Jay Palmer pays to [SJW] Property Commerce

commissions allegedly owed to them for two (2) deals that were completed at Jackson

Palmer Crossing,” SJW and PCDC would “assign [Dr. Kilgore’s] contract to [Palmer].” As

noted earlier, Dr. Kilgore’s contract exclusively involved Palmer’s Trenton Project.

Therefore, the statement made by Jay Williams to Trammell Crow indicates that SJW and

PCDC viewed the disputes at Jackson Palmer Crossing and at 10th Street and Trenton

Road as inextricably intertwined. Because the record supports a finding that the claims in

dispute are logically related, we conclude that SPP had a justiciable interest in the outcome

of this matter and, thus, was aggrieved; as such, we cannot say that SPP lacked standing

23 to assert its February 9, 2004 counterclaims.17

2. The Substitution of Palmer as “Counter-Plaintiff”

Despite concluding that SPP had standing to assert its counterclaims, we do not

believe that SPP had the capacity to sue SJW and PCDC for damages sustained at the

Trenton Project because SPP was not a party to the negotiations pertaining to the Trenton

Project. See Nootsie, Ltd., 925 S.W.3d at 661 (defining “capacity” as the legal authority

to act, regardless of whether it has a justiciable interest in the controversy). Realizing that

SPP lacked the capacity to sue for damages associated with the Trenton Project, the

Palmer companies substituted Palmer as the proper “Counter-Plaintiff” without asserting

any new causes of action. See Carter v. DeJarnatt, 523 S.W.2d 88, 91 (Tex.

App.–Texarkana 1975, writ ref’d n.r.e.) (concluding that suit was not barred by limitations

where the amended petition, which was filed after the expiration of the limitations period,

did not change the cause of action but, rather, changed the capacity in which appellant

sued). Texas courts have recognized that a mistake in naming parties to a lawsuit, such

as here, constitutes a case of misnomer.

“Misnomer cases are analyzed by asking the following questions: (1) Would a

judgment under the original pleading bar recovery under the amended pleading? (2) Would

the same evidence support both of the pleadings? (3) Is the measure of damages the

same in both pleadings? (4) Are the allegations of each pleading subject to the same

defenses?” Foust v. Estate of Walters, 21 S.W.3d 495, 501 (Tex. App.–San Antonio 2000,

pet. denied) (citing Phoenix Lumber Co. v. Houston Water Co., 94 Tex. 456, 61 S.W. 707,

17 The parties do not challenge whether the Palm er com panies’ counterclaim s were filed within the proper tim e fram e after SJW and PCDC filed their original petition and the Palm er com panies filed their original answer. See T EX . C IV . P RAC . & R EM . C OD E A N N . § 16.069(b) (Vernon 2008). In their appellate brief, the Palm er com panies m erely state that the counterclaim s were tim ely filed; m oreover, SJW and PCDC never address this statem ent in their response to the Palm er com panies’ appellate brief. 24 709 (1901)). “When a party is misnamed, but no one has been misled or disadvantaged

by the error in pleading, the relation-back doctrine operates to preserve the claim against

a bar of limitations.” Id. (citing Dougherty v. Gifford, 826 S.W.2d 668, 677 (Tex.

App.–Texarkana 1992, no writ); Palmer v. Enserch Corp., 728 S.W.2d 431, 434 (Tex.

App.–Austin 1987, writ ref’d n.r.e.)). “If the nature of the suit against the defendants

remains unchanged, the substitution of parties-plaintiff does not constitute a new suit.” Id.

(citing Vaughn Bldg. Corp. v. Austin Co., 620 S.W.2d 678, 682 (Tex. Civ. App.–Dallas

1981), aff’d, 643 S.W.2d 113 (Tex. 1982); Medford v. Red River County, 84 S.W.2d 345,

352 (Tex. Civ. App.–El Paso 1935, no writ)). In other words, so long as the purpose and

the nature of the claim asserted are clear from the outset, the substitution of a personal

representative for a party without capacity does not introduce a new or different cause of

action and the substitution should satisfy the relation-back doctrine. See Lovato, 171

S.W.3d at 852-53; see also Lorentz v. Dunn, 171 S.W.3d 854, 856 (Tex. 2005).

In the present case, the record demonstrates that Palmer is the president and,

therefore, personal representative of SPP. Furthermore, the Palmer companies’ first

amended answer and counterclaims filed on November 8, 2005, substituted Palmer

himself as the proper “Counter-Plaintiff” and advanced the same causes of action against

SJW as contained in the Palmer companies’ original counterclaims. Neither SJW nor

PCDC objected to Palmer’s substitution as “Counter-Plaintiff.” Moreover, neither SJW nor

PCDC demonstrated to the trial court that they were prejudiced or disadvantaged by

Palmer’s substitution as “Counter-Plaintiff.” It is clear to us that Palmer was substituted in

place of SPP because SPP lacked the capacity to sue for damages pertaining to the

Trenton Project. Based on the record before us, we cannot say that the substitution of

Palmer as “Counter-Plaintiff” amounted to a new suit or was improper. 25 3. Section 16.069, the Relation-Back Doctrine, and Limitations

Given that we have concluded that Palmer was the proper party to bring suit against

SJW for the purported conduct that transpired at the Trenton Project, we must now

determine whether the Palmer companies’ counterclaims were barred by limitations or

whether the limitations period was tolled by sections 16.068 and 16.069 of the civil practice

and remedies code, as alleged by the Palmer companies on appeal. See TEX . CIV. PRAC .

& REM . CODE ANN . §§ 16.068, 16.069. Here, the Palmer companies alleged that SJW: (1)

tortiously interfered with Palmer’s earnest money contracts; (2) tortiously interfered with

Palmer’s prospective business relations with the landowners; (3) breached its fiduciary duty

owed to Palmer; and (4) committed fraud. On appeal, SJW and PCDC argue that the

Palmer companies’ counterclaims were time-barred. SJW and PCDC further argue that

the Palmer companies’ counterclaims were really third-party actions; thus, section 16.069

of the civil practice and remedies code did not serve to toll the limitations period.

The limitations period for breach of fiduciary duty and fraud is four years. See TEX .

CIV. PRAC . & REM . CODE ANN . § 16.004(a)(4)-(5) (Vernon 2002); see also Willis v. Donnelly,

199 S.W.3d 262, 278 n.33 (Tex. 2006); Exxon Corp. v. Emerald Oil & Gas Co., No. 05-

1076, 2009 Tex. LEXIS 113, at *22 (Tex. Mar. 27, 2009) (citing Little v. Smith, 943 S.W.2d

414, 420 (Tex. 1997)). In question number 21, the jury, after considering all the evidence

adduced at trial, concluded that Palmer discovered the alleged fraud perpetrated by SJW

on September 8, 2000; therefore, the statute of limitations for the Palmer companies’

breach of fiduciary duty and fraud causes of action began to run from that date. See

Emerald Oil & Gas Co., 2009 Tex. LEXIS 113, at *22 (citing Little, 943 S.W.2d at 420)

(holding that the limitations period for fraud begins to run from the time the party knew of

the misrepresentation). The Palmer companies first asserted their breach of fiduciary duty 26 and fraud causes of action as to SJW in their original counterclaims filed on February 9,

2004, which was more than six months before the four-year limitations period expired.

Thus, the Palmer companies’ breach of fiduciary duty and fraud causes of action were

timely filed by SPP against SJW. However, in asserting these causes of action, the Palmer

companies designated SPP as “Counter-Plaintiff,” and we have already concluded that

SPP lacked the capacity to bring these causes of action. The substitution of Palmer as

“Counter-Plaintiff” did not transpire until November 8, 2005, which was more than one year

after the four-year limitations period expired. Absent any tolling of the limitations period,

the Palmer companies’ breach of fiduciary duty and fraud claims would be time-barred.

However, the Palmer companies argue that the relation-back doctrine tolls the

applicable limitations period. Under the relation-back doctrine, as outlined by section

16.068 of the civil practice and remedies code,

if a filed pleading relates to a cause of action, cross action, counterclaim, or defense that is not subject to a plea of limitation when the pleading is filed, a subsequent amendment or supplement to the pleading that changes the facts or grounds of liability or defense is not subject to a plea of limitation unless the amendment or supplement is wholly based on a new, distinct, or different transaction or occurrence.

TEX . CIV. PRAC . & REM . CODE ANN . § 16.068; see Brewster v. Columbia Med. Ctr. of

McKinney Subsidiary, L.P., 269 S.W.3d 314, 317 (Tex. App.–Dallas 2008, no pet.).

Section 16.068 is a tolling statute that stops the clock at the time that the original petition

is filed, if filed within the limitations period, but cannot toll a time period already expired.

See Almazan v. United Servs. Auto Ass’n, 840 S.W.2d 776, 779 (Tex. App.–San Antonio

1992, writ denied). This section is designed to protect litigants from loss of their claims by

a plea of limitations in cases where that would otherwise occur and, therefore, should be

liberally construed. Milestone Props., Inc. v. Federated Metals Corp., 867 S.W.2d 113, 116

27 (Tex. App.–Austin 1993, no writ). “The relation-back doctrine originated as an equitable

remedy designed to effectuate justice.” Lovato v. Austin Nursing Ctr., Inc., 113 S.W.3d 45,

55 (Tex. App.–Austin 2003), aff’d, 171 S.W.3d 845 (citing Cain v. State, 882 S.W.2d 515,

518 (Tex. App.–Austin 1994, no writ)). “‘It enables the court to arrive at conclusions that

will effectuate justice while maintaining simultaneously the appearance of logical

consistency.’” Id. (quoting Cain, 882 S.W.2d at 518).

“The relation-back doctrine has been applied to cure capacity issues, but it cannot

retroactively create personal jurisdiction.” Armes v. Thompson, 222 S.W.3d 79, 84 (Tex.

App.–Eastland 2006, no pet.). For example, the Texas Supreme Court has allowed the

alleged personal representative in a probate cases to obtain the probate court’s permission

to represent the estate after litigation had been filed on behalf of the estate. See Lovato,

171 S.W.3d at 853-56; see also Lorentz, 171 S.W.3d at 856. However, this does not mean

“that subsequent pleadings can give the trial court jurisdiction over new parties retroactive

to the original filing of the suit.” Armes, 222 S.W.3d at 84 (citing Covington v. Sisters of

Charity of the Incarnate Word, 179 S.W.3d 583, 587-88 (Tex. App.–Amarillo 2005, pet.

denied)).

Essentially, the relation-back doctrine allows for a party to amend or supplement a

pleading changing facts or grounds of liability or even correct capacity issues as long as

the original claims were timely filed and the amendments or supplementation do not

constitute a “new, distinct, or different transaction or occurrence.” See TEX . CIV. PRAC . &

REM . CODE ANN . § 16.068; see also Armes, 222 S.W.3d at 84. Here, we have already

concluded that: (1) the Palmer companies’ breach of fiduciary duty and fraud claims were

timely filed by SPP against SJW; (2) SPP had standing to file suit against SJW for the

purported actions occurring during the development of the Trenton Project; and (3) the 28 disputes at the Jackson Palmer Crossing shopping center and the Trenton Project were

logically related so as to constitute the same transaction or occurrence. Therefore, in

applying the relation-back doctrine, we conclude that the Palmer companies’ substitution

of Palmer as “Counter-Plaintiff,” though subject to a plea of limitation on its own, relates

back to the original, timely-filed breach of fiduciary duty and fraud counterclaims brought

by SPP against SJW. See TEX . CIV. PRAC . & REM . CODE ANN . § 16.068; see also Armes,

222 S.W.3d at 84. The Palmer companies were allowed to cure capacity issues in their

first amended counterclaims without losing their counterclaims to a plea of limitations. See

Armes, 222 S.W.3d at 84; Milestone Props., Inc., 867 S.W.2d at 116; see also Lovato, 113

S.W.3d at 55. Thus, we hold that the Palmer companies’ breach of fiduciary duty and

fraud counterclaims were timely filed.

On the other hand, the statute of limitations for tortious interference with an existing

contract and prospective business relations is two years. See TEX . CIV. PRAC . & REM . CODE

ANN . § 16.003 (Vernon Supp. 2009); First Nat’l Bank of Eagle Pass v. Levine, 721 S.W.2d

287, 289 (Tex. 1986) (rejecting that the four-year limitations period applies to a claim for

tortious interference with prospective business relations and noting that the two-year

limitations period that applies to trespass to property actions also applies to tortious

interference with prospective business relations actions); Gambrinus Co. v. Galveston

Bev., Ltd., 264 S.W.3d 283, 289 (Tex. App.–San Antonio 2008, pet. denied); Snell v.

Sepulveda, 75 S.W.3d 142, 144 (Tex. App.–San Antonio 2002, no pet.); see also Cantu

v. Romero, Gonzalez & Benavides, LLP, No. 04-08-00786-CV, 2009 Tex. App. LEXIS

8241, at *5 (Tex. App.–San Antonio Oct. 28, 2009, no pet.). The jury concluded that

Palmer, in the exercise of reasonable diligence, should have discovered SJW’s alleged

tortious interference with his earnest money contracts on August 8, 2000; thus, the 29 limitations period began to run from that date. Based on the jury’s finding, the limitations

period for the Palmer companies’ tortious interference with an existing contract and

prospective business relations claims as to SJW would have expired on August 8, 2002;

thus, the counterclaims would have been time-barred, absent any tolling of the limitations

period.

Section 16.069 of the civil practice and remedies states as follows:

(a) If a counterclaim or cross claim arises out of the same transaction or occurrence that is the basis of an action, a party to the action may file a counterclaim or cross claim even though as a separate action it would be barred by limitation on the date the party’s answer is required.

(b) the counterclaim or cross claim must be filed not later than the 30th day after the date on which the party’s answer is required.

TEX . CIV. PRAC . & REM . CODE ANN . § 16.069. The purpose of section 16.069 “is to prevent

a plaintiff from waiting until the adversary’s valid claim arising from the same transaction

was barred by limitations before asserting his own claim.” Wells, 261 S.W.3d at 281 (citing

Hobbs Trailers v. J.T. Arnett Grain Co., 560 S.W.2d 85, 88-89 (Tex. 1977)).

Here, the Palmer companies’ counterclaims as to SJW contain some claims that

were brought within the applicable limitations period—the breach of fiduciary duty and

fraud claims—and some claims that were not—the tortious interference with contract and

prospective business relations claims. We have already concluded that the disputes

pertaining to the Jackson Palmer Crossing shopping center and Palmer’s Trenton Project

are logically related and, thus, constitute the same transaction. No party disputes that the

Palmer companies’ tortious interference with contract and prospective business relations

claims related to Palmer’s Trenton Project. Furthermore, SJW and PCDC do not allege

that the Palmer companies failed to comply with section 16.069(b)’s timeliness

requirement. See TEX . CIV. PRAC . & REM . CODE ANN . § 16.069(b). Therefore, given that 30 the Jackson Palmer Crossing dispute and the Trenton Project dispute constitute a single

transaction, we conclude that section 16.069(a) permitted the Palmer companies to assert

their tortious interference with contract and prospective business relations claims as to

SJW even though such claims would have been time-barred had they been filed

separately. See id. § 16.069(a).

With regard to SJW and PCDC’s argument that the Palmer companies’

counterclaims were really third-party actions, SJW and PCDC do not cite to any authority

supporting their contention. In fact, we are only able to find one case addressing such a

contention within the context of section 16.069. See J.M.K. 6, Inc. v. Gregg & Gregg, P.C.,

192 S.W.3d 189, 199-202 (Tex. App.–Houston [14th Dist.] 2006, no pet.). In J.M.K. 6, the

Fourteenth Court of Appeals concluded that third-party actions are not contemplated by

the terms “counterclaim or cross claim” contained in section 16.069 of the civil practice and

remedies code and that “the purpose of section 16.069 would not be served by rewriting

it to allow a defendant to revive an expired claim against a non-party.” Id. at 200-02; see

TEX . CIV. PRAC . & REM . CODE ANN . § 16.069. Thus, if the Palmer companies’ counterclaims

are really third-party actions, then their tortious interference with contract and prospective

business relations claims would not be saved by section 16.069.

In reviewing rules 38 and 97 of the rules of civil procedure, we conclude that the

Palmer companies’ claims against SJW are not third-party actions but, rather, constitute

counterclaims. See TEX . R. CIV. P. 38, 97. Rule 38, entitled “Third-Party Practice,” states

that:

At any time after commencement of the action a defending party, as a third- party plaintiff, may cause a citation and petition to be served upon a person not a party to the action who is or may be liable to him or to the plaintiff for all or part of the plaintiff’s claim against him.

31 Id. at R. 38. On the other hand, rule 97(b) provides that: “A pleading may state as a

counterclaim any claim against an opposing party whether or not arising out of the

transaction or occurrence that is the subject matter of the opposing party’s claim.” Id. at

R. 97(b).

In the instant case, SJW filed suit against the Palmer companies, including SPP and

Palmer, individually. The Palmer companies’ February 9, 2004 counterclaims did not

assert causes of action against “a person not a party to the action who is or may be liable

to him or to the plaintiff for all or part of the plaintiff’s claim against him.” See id. at R. 37.

Instead, the Palmer companies’ February 9, 2004 counterclaims state claims that, as we

have already concluded, arise out of the same transaction or occurrence as SJW’s dispute

involving commissions at the Jackson Palmer Crossing shopping center and were against

the opposing party—SJW. See id. at R. 97(b); CDB Software, Inc. v. Kroll, 982 S.W.2d

629, 632 (Tex. App.–Houston [1st Dist.] 1998, no pet.); Latham v. Allison, 560 S.W.2d 481,

485 (Tex. App.–Fort Worth 1977, writ ref’d n.r.e.) (defining a counterclaim as “a claim,

which, if established will defeat or in some way qualify a judgment to which the plaintiff is

otherwise entitled. It embraces both setoff and recoupment, and also comprehends

reconvention as well as all adversary actions by the defendant in a case”); see also

BLACK’S LAW DICTIONARY 286 (7th ed. 2000) (defining a counterclaim as “[a] claim for relief

asserted against an opposing party after an original claim has been made”). We therefore

conclude that the Palmer companies’ claims against SJW constituted counterclaims and,

thus, fell within the scope of section 16.069 of the civil practice and remedies code. See

TEX . CIV. PRAC . & REM . CODE ANN . § 16.069; see also TEX . R. CIV. P. 97(b).

4. The Palmer Companies’ Claims Against PCDC

Regarding PCDC’s inclusion in this dispute, SJW and PCDC argue that because 32 PCDC was not added to the lawsuit until June 23, 2006, the Palmer companies’ claims

against PCDC are barred by limitations. SJW and PCDC further argue that the Palmer

companies’ claims against PCDC constitute a third-party action rather than a counterclaim;

thus, the tolling of the limitations period under sections 16.068 and 16.069 is not allowed

for the third-party action. The Palmer companies contend that: (1) PCDC had fair notice

of the Palmer companies’ claims, and, thus, PCDC could not have been prejudiced by its

inclusion in the lawsuit; and (2) the evidence suggests that SJW and PCDC “are closely

related, if not identical” and that the claims alleged against PCDC arose out of the same

transaction or occurrence as the Palmer companies’ claims against SJW.18

PCDC was not a party to SJW’s original petition and was joined to the lawsuit when

the Palmer companies filed their second amended answer and counterclaims on June 23,

2006, approximately six years after the causes of action contained in the Palmer

companies’ counterclaims accrued. Because PCDC was joined as a party to the action by

the Palmer companies on June 23, 2006, Texas Rule of Civil Procedure 38 dictates a

finding that the Palmer companies’ claims against PCDC constituted a third-party action.

See TEX . R. CIV. P. 38. Therefore, because the Palmer companies claims against PCDC

were actually third-party actions rather than counterclaims or cross claims, we conclude

that the claims against PCDC were not tolled by either section 16.068 or section 16.069

of the civil practice and remedies code and were, thus, time-barred. See TEX . CIV. PRAC .

& REM . CODE ANN . §§ 16.068, 16.069; see also J.M.K. 6, Inc., 192 S.W.3d at 199-202.

In sum, we hold that: (1) the Jackson Palmer Crossing dispute and the Trenton

Project dispute are inextricably intertwined and, thus, constitute a single transaction or

18 The Palm er com panies do not cite, nor are we aware of, authority supporting the application of the relation-back doctrine to tim e-barred claim s against a third-party that m ay be “closely related, if not identical” to a properly nam ed party to a lawsuit. 33 occurrence; (2) SPP had standing to file its February 9, 2004 counterclaims against SJW;

(3) Palmer was properly substituted as “Counter-Plaintiff” in the Palmer companies’ first

amended answer and counterclaims; (4) the Palmer companies’ claims against SJW

constituted counterclaims; (5) the Palmer companies’ counterclaims against SJW were

tolled by sections 16.068 and 16.069 of the civil practice and remedies code and,

therefore, relate back to the Palmer companies’ timely-filed February 9, 2004

counterclaims; and (6) the Palmer companies’ claims against PCDC constituted third-party

actions, which did not toll the applicable limitations periods. Accordingly, we overrule SJW

and PCDC’s first issue, in part, and sustain it, in part.

IV. LEGAL AND FACTUAL SUFFICIENCY OF THE JURY’S LIABILITY FINDINGS

By their second issue, SJW and PCDC argue that the evidence supporting the jury’s

verdict that SJW and PCDC: (1) intentionally interfered with Palmer’s earnest money

contracts; (2) breached a fiduciary duty allegedly owed to Palmer; and (3) committed fraud

on Palmer is insufficient. The Palmer companies assert that the evidence supporting the

jury’s liability findings is supported by legally and factually sufficient evidence.

A. Standard of Review

At the outset of our analysis on this issue, we note that because the Palmer

companies’ claims against PCDC were barred by limitations, we need not address SJW

and PCDC’s contentions regarding the sufficiency of the evidence supporting the jury’s

verdict as to PCDC.19 See TEX . R. APP. P. 47.1.

We must sustain a challenge to a jury finding based on legal sufficiency only when:

(1) the record discloses a complete absence of evidence of a vital fact; (2) the court is

19 Because we have concluded that the Palm er com panies’ claim s against PCDC were tim e-barred, we only reference SJW as appellant/cross-appellee for the rem aining issues in this case. 34 barred by rule of law or of evidence from giving weight to the only evidence offered to

prove a vital fact; (3) the evidence provided to prove a vital fact is no more than a mere

scintilla; or (4) the evidence establishes conclusively the opposite of a vital fact. City of

Keller v. Wilson, 168 S.W.3d 802, 810-11 (Tex. 2005). “[W]hen the evidence offered to

prove a vital fact is so weak as to do no more than create a mere surmise or suspicion of

its existence, the evidence is less than a scintilla and, in legal effect, is no evidence.” Ford

Motor Co. v. Ridgway, 135 S.W.3d 598, 601 (Tex. 2004). More than a scintilla of evidence

exists if the evidence rises to a level that would enable reasonable and fair-minded people

to differ in their conclusions. Id.

In our legal sufficiency review, we review the evidence in the light most favorable

to the finding, crediting favorable evidence if a reasonable fact-finder could and

disregarding contrary evidence unless a reasonable fact-finder could not. City of Keller,

168 S.W.3d at 807. The final test for legal sufficiency is whether the evidence presented

at trial would enable reasonable and fair-minded people to make the finding under review.

Id. at 827.

The jury is the sole judge of witnesses’ credibility, and it may choose to believe one

witness over another; a reviewing court may not impose its own opinion to the contrary.

Id. at 819. Because it is the jury’s province to resolve conflicting evidence, we must

assume that jurors resolved all conflicts in accordance with their verdict if reasonable

human beings could do so. Id.

On the other hand, when reviewing a jury finding for factual sufficiency, we consider

all of the evidence in a neutral light and conclude that the finding is not supported by

sufficient evidence only if the finding is so contrary to the overwhelming weight of the

evidence as to be clearly wrong and unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 35 1986) (per curiam). If we determine that the evidence supporting the jury’s verdict is not

supported by factually sufficient evidence, we must “detail the evidence relevant to the

issue” and “state in what regard the contrary evidence greatly outweighs the evidence in

support of the verdict.” Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001) (per

curiam).

B. Tortious Interference With Contract

The elements of tortious interference with a contract are: (1) the existence of a

contract subject to interference; (2) willful and intentional interference; (3) interference that

proximately caused damage; and (4) actual damage or loss. ACS Invs., Inc. v.

McLaughlin, 943 S.W.2d 426, 430 (Tex. 1997).

On appeal, SJW contends that the jury’s verdict regarding the Palmer companies’

tortious interference with a contract and prospective business relations is not supported by

legally and factually sufficient evidence. Specifically, SJW contends that Palmer failed to

prove the essential elements of his intentional interference with contract claims because:

(1) the record does not show that Palmer had contracts with Whisenant, Wayne and Gelee

Allen, and Kayser in April 2000; (2) Palmer’s earnest money contracts were “never closed”

because he allegedly failed to deposit earnest money with the title company; and (3)

Palmer’s own greed, rather than the alleged conduct of SJW, was the cause of the delay

in selling the property to Target for a profit.

1. Palmer’s Earnest Money Contracts

Palmer testified that he had all of the landowners at the Trenton Project, except for

Dr. Kilgore, under contract in April 2000. The group included Whisenant and Wayne and

Gelee Allen. Moreover, the record contains copies of the contracts between Palmer and

all of the landowners, except Wayne and Gelee Allen. Wayne Allen testified via deposition 36 that he and his wife, Gelee, were under contract with Palmer in April 2000. Furthermore,

Schwarz specifically recalled Palmer having five contracts—with Whisenant, Wayne and

Gelee Allen, Opal Baldwin, Harlon and Mary Robinson, and Yvonne Robinson—at the

Trenton Project in April 2000.

The disputed Whisenant contract is also contained in the record and demonstrates

that Palmer contracted to pay Whisenant $467,712.50 or, in other words, $10.00 per

square foot for his 22.36-acre tract. The Whisenant contract, however, does not specify

an effective date. The Kayser tract, on the other hand, does not appear to be under

contract in April 2000. However, Palmer testified that he and Kayser began negotiations

in the middle of 2000, and eventually agreed to a contract, whereby Palmer purchased

Kayser’s tract for $3.5 million.

We first note that the jury charge does not contain a question asking the jury to

specifically determine whether Palmer had all of the landowners, including Kayser, under

contract in April 2000. The jury was merely asked whether SJW interfered with any of

Palmer’s earnest money contracts. SJW did not object to the jury charge questions

pertaining to the Palmer companies’ tortious interference claims. See In re B.L.D., 113

S.W.3d 340, 349 (Tex. 2003) (“[A]ny complaint to a jury charge is waived unless

specifically included in an objection.”) (citing TEX . R. CIV. P. 274; TEX . R. APP. P. 33.1(a)(1));

see also Statewide Mobile Homes, L.L.C. v. Tesoro, Inc., No. 13-08-00313-CV, 2009 Tex.

App. LEXIS 6332, at *8 (Tex. App.–Corpus Christi Aug. 13, 2009, no pet.) (mem. op.).

Therefore, to the extent that SJW complains about the jury’s verdict relating to the dates

in which Palmer had each of the landowners under contract, we conclude that such

complaints were waived by failure to lodge a specific objection to the jury charge or request

that such a question be included in the jury charge. 37 SJW also contends that even if Palmer had the above-mentioned parties under

contract, the earnest money contracts were unenforceable and could not be the basis for

the Palmer companies’ tortious interference with contract claims because the earnest

money checks were not directly deposited with the title company. With regard to a similar

dispute, the supreme court has stated the following:

[E]ven an unenforceable contract may serve as the basis for a tortious interference claim if the contract is not void. . . . In other words, mere unenforceability of a contract is not a defense to an action for tortious interference with its performance. . . . Until a contract is terminated, it is valid and subsisting, and third persons are not free to tortiously interfere with it.

Juliet Fowler Homes, Inc. v. Welch Assocs., 793 S.W.2d 660, 664, 666 (Tex. 1990).

Here, Palmer testified that he tendered earnest money checks for each of the

contracts to Schwartz. Schwartz recalled receiving all of the earnest money checks from

Palmer, but the contracts themselves do not state that the earnest money checks were

deposited with the title company. Instead of depositing the earnest money with the title

company, Schwartz apparently kept the earnest money in his files, and he could not recall

why this was done. In any event, the landowners and Palmer all thought that they had

valid and enforceable contracts, as evidenced by the landowners granting Palmer several

extensions of time to determine the feasibility of the project. Moreover, the contracts do

not contain a provision stating that a failure to deposit earnest money with the title

company renders the contract null and void. Instead, the contracts were voidable, meaning

the landowners had the option to terminate the contract—which only Opal Baldwin and

Harlon and Mary Robinson did a couple days after being approached by SJW—or the

landowners could ratify non-compliance with the contract. See Swain v. Wiley College, 74

S.W.3d 143, 146 (Tex. App.–Texarkana 2002, no pet.) (stating that a voidable contract can

be ratified). Clearly, the parties believed that they had valid and enforceable contracts. 38 Furthermore, the record does not demonstrate that the earnest money was ever deposited

with the title company; however, Target accepted Palmer’s assignment of the allegedly

unenforceable contracts and proceeded to develop the property.

Given the facts in this case and the supreme court’s holding in Juliet Fowler Homes,

we cannot say that Palmer’s alleged failure to deposit the earnest money checks with the

title company is of any importance to our analysis of the Palmer companies’ tortious

interference with contract claims, especially considering that the supreme court specifically

held that it is possible for a third party to tortiously interfere with an unenforceable contract

so long as the contract is not void. Palmer’s earnest contracts were not a nullity at their

inception or, in other words, void. See id.; see also Hacienda Ford v. Smart Auto. Group,

L.L.C., No. 13-04-00605-CV, 2006 Tex. App. LEXIS 6658, at *8 (Tex. App.–Corpus Christi

July 27, 2006, pet. denied) (mem. op.) (“It is well settled that a contract is void when it is

for ‘a thing which cannot be performed without a violation of the law . . . .’”) (quoting Lewis

v. Davis, 145 Tex. 468, 199 S.W.2d 146, 148-49 (1947)); Swain, 74 S.W.3d at 146 (stating

that a void contract cannot be ratified and is, therefore, a nullity at its inception).

Based on the foregoing, we conclude that there was sufficient evidence for the jury

to conclude that Palmer had Whisenant, Wayne and Gelee Allen, Yvonne Robinson, Opal

Baldwin, Harlon and Mary Robinson, and Eugene Kayser under contract.

2. The Remaining Elements of the Palmer Companies’ Tortious Interference With a Contract Causes of Action

With regard to the “willful and intentional interference” prong of the tortious

interference with contract cause of action, Texas courts have held that interference with

a contract is tortious only when it is intentional, and there must be some direct evidence

of a willful act of interference by a party. See Browning-Ferris, Inc. v. Reyna, 865 S.W.2d

39 925, 927 (Tex. 1993); see also Sw. Bell Tel. Co. v. John Carlo Tex., Inc., 843 S.W.2d 470,

471 (Tex. 1992). A party must be more than a willing participant; he must knowingly

induce one of the contracting parties to breach its obligations. See Reyna, 865 S.W.2d at

927; John Paul Mitchell Sys. v. Randalls Food Mkts., 17 S.W.3d 721, 731 (Tex.

App.–Austin 2000, pet. dism’d w.o.j.)20; see also Arabesque Studios, Inc. v. Academy of

Fine Arts Int’l Inc., 529 S.W.2d 564, 568 (Tex. Civ. App.–Dallas 1975, no writ) (holding that

a plaintiff must show that defendant caused the interference, and it is not enough that

defendant reaped an advantage of a contract broken by the breaching party’s own volition).

Here, the record demonstrates that Palmer had earnest money contracts with

Whisenant, Wayne and Gelee Allen, Yvonne Robinson, Opal Baldwin, and Harlon and

Mary Robinson through September 2000. However, in September 2000, when Palmer’s

earnest money contracts were expiring, Trozzo, on behalf of SJW, approached the

landowners to allegedly inquire whether they were still under contract. Trozzo’s efforts

were documented in a September 7, 2000 letter, where he thanked the landowners for

their time and noted that SJW was not aware that the landowners were still under contract.

This letter, however, appears to be disingenuous considering the testimony of Palmer and

Dr. Kilgore.

Palmer testified that SJW was always aware of the status of Palmer’s earnest

money contracts and that, in September 2000, he still had all of the landowners except for 20 In John Paul Mitchell Systems v. Randalls Food Markets, the Austin Court of Appeals stated that:

A necessary elem ent of the plaintiff’s cause of action is a showing that the defendant took an active part in persuading a party to a contract to breach it. Merely entering into a contract with a party with the knowledge of that party’s contractual obligations to som eone else is not the sam e as inducing a breach. It is necessary that there be som e act of interference or of persuading a party to breach, for exam ple by offering better term s or other incentives, for tort liability to arise.

17 S.W .3d 721, 731 (Tex. App.–Austin 2000, pet. dism ’d w.o.j.) (quoting Davis v. HydPro, Inc., 839 S.W .2d 137, 139 (Tex. App.–Eastland 1992, writ denied) (internal quotations om itted)). 40 Dr. Kilgore under contract. Palmer alleged that Trozzo’s efforts were an attempt to induce

the landowners to terminate their contracts with Palmer and enter into similar contracts with

SJW. Dr. Kilgore corroborated Palmer’s testimony by stating that he was approached by

Trozzo during the early stages of the development of the Trenton Project, and that Trozzo

informed Dr. Kilgore that SJW intended to get Dr. Kilgore under contract to tie up the

development until Palmer’s earnest money contracts expired so that SJW could then get

the landowners under contract and sell the property to Target themselves.21

As a result of Trozzo’s interactions with the landowners, Opal Baldwin and Harlon

and Mary Robinson, all elderly landowners, each sent Palmer nearly identically-worded

letters a couple days later, notifying him that their earnest money contracts were

“terminated” and “null and void.” (Emphasis in original.) Furthermore, the remaining

landowners became anxious and demanded assurances from Palmer that he could get Dr.

Kilgore under contract soon so that the land could be packaged and sold to Target. In a

letter to SJW dated September 13, 2000, Palmer informed SJW that he was aware of

SJW’s efforts to induce the landowners to breach their contracts and that SJW’s actions

“tarnished [Palmer’s] reputation as a developer in the community” and “resulted in

substantial loss to [Palmer].”

Palmer’s damages expert, Bill Abington, a certified public accountant and a certified

fraud examiner, evaluated the economic losses sustained by the Palmer companies as a

result of SJW’s alleged wrongful conduct. Abington concluded that the Palmer companies

21 As noted earlier, Dr. Kilgore’s tract was an essential piece of the land package to be presented to Target. Target was not interested in only purchasing non-contiguous parcels of land. Furtherm ore, it was not until m uch later in the life of the Trenton Project that Palm er learned that SJW had Dr. Kilgore under contract since June 6, 2000. SJW , acting as Target’s agent, willingly assigned its interest in Dr. Kilgore’s tract after Palm er agreed to assign the tracts he had under contract; thus, Target was assigned a com plete parcel of land to develop. Therefore, SJW ’s argum ent that the Palm er com panies’ failure to secure a profit from Target was due to Palm er’s own greed appears to be unfounded. 41 sustained $376,397 in damages regarding the delayed sale of the Robinson tract to Target,

$207,926 associated with lost rental income, and various other damages.

With regard to Palmer’s contract with Kayser, Palmer testified that when he met with

Stanley Williams in May 2001, Palmer was already in negotiations with Kayser for the

purchase of his land. Palmer alleged that Kayser had approved a contract for the sale of

his land to Palmer for $1.96 million. However, the record does not include a copy of this

purported contract. In any event, Palmer met with Stanley Williams on the premise that

Jay Williams and Trozzo would not be involved in further deals between Palmer and SJW.

Prior to the meeting, Stanley Williams requested additional confidential pricing and

contractual information from Palmer. At the conclusion of the meeting, Palmer agreed to

assign his earnest money contracts at the Trenton Project to Target for no profit in

exchange for the REA, which would assist Palmer in developing the Kayser tract. It is

unlikely that Palmer would not have bargained for the REA if he did not have the Kayser

tract under contract or he was confident that he could quickly acquire the Kayser tract for

development.

Palmer then testified that Trozzo called Kayser and offered him $3 million for the

land even though Palmer had already allegedly had an approval from Kayser for the

purchase of the land for $1.96 million.22 Palmer believed that Stanley Williams informed

Trozzo of the importance of the REA, and Trozzo subsequently bid up the price of the

Kayser tract and attempted to induce Kayser to breach his land-sale agreement with

Palmer. As a result of SJW’s efforts, Palmer alleged that he was forced to buy the Kayser

tract in 2002, for $3.5 million, which was significantly higher than the purported original

22 The record includes a purchase agreem ent sent by SJW to Kayser, offering Kayser $2,213,719.20 for his land. This agreem ent, however, was neither signed nor executed. 42 $1.96 million agreement.

SJW directs us to several exhibits in the record which allegedly undermine Palmer’s

allegations; however, we must keep in mind that the resolution of conflicting evidence and

testimony was within the province of the jury, and we must not substitute our judgment for

that of the jury. See City of Keller, 168 S.W.3d at 819. Clearly, the jury believed Palmer’s

version of what had happened, and we must defer to the jury’s conclusions so long as the

conclusions are reasonable. See id. In reviewing the evidence in the light most favorable

to the jury’s findings, we conclude that the jury was reasonable in concluding that SJW

willfully and intentionally interfered with Palmer’s contracts and that SJW’s interference

proximately caused Palmer actual damages or loss. See id. at 807, 810-11; see also

McLaughlin, 943 S.W.2d at 430. Furthermore, in reviewing the evidence in a neutral light,

we cannot conclude that the jury’s findings as to this issue were so contrary to the

overwhelming weight of the evidence as to be clearly wrong or unjust. See Cain, 709

S.W.2d at 176. Accordingly, we find that the evidence supporting the jury’s conclusion that

SJW tortiously interfered with Palmer’s contracts is legally and factually sufficient. See City

of Keller, 168 S.W.3d at 807, 810-11; see also Cain, 709 S.W.2d at 176.

C. Breach of Fiduciary Duty

While we note that section 41.002(a) of the civil practice and remedies

code—contained within the exemplary damages chapter—“applies to any action in which

a claimant seeks damages relating to a cause of action” and, therefore, the jury’s

exemplary damage award may be sustained solely by Palmer’s tortious-interference

claims, we analyze Palmer’s breach of fiduciary duty and fraud causes of action because

our attorney’s fees analysis is partially premised on the jury’s findings on these causes of

action. See TEX . CIV. PRAC . & REM . CODE ANN . § 41.002(a) (Vernon 2008). 43 In order to prevail on a breach of fiduciary duty claim, a plaintiff must prove: (1) the

existence of a fiduciary relationship between the plaintiff and the defendant; (2) a breach

by the defendant of his or her fiduciary duty to the plaintiff; and (3) an injury to the plaintiff

or benefit to the defendant as a result of the breach. See Lundy v. Masson, 260 S.W.3d

482, 501 (Tex. App.–Houston [14th Dist.] 2008, pet. denied); see also Bradshaw v. Bonilla,

No. 13-08-00595-CV, 2010 Tex. App. LEXIS 662, at *9 (Tex. App.–Corpus Christi Jan. 28,

2010, pet. denied) (mem. op.). A plaintiff bears the burden of proving each element of his

breach of fiduciary duty claim. See, e.g., Avary v. Bank of Am., N.A., 72 S.W.3d 779, 792

(Tex. App.–Dallas 2002, pet. denied).

A fiduciary relationship may arise as a matter of law in certain formal relationships.

See Meyer v. Cathey, 167 S.W.3d 327, 330 (Tex. 2005) (per curiam); Priddy v, Rawson,

282 S.W.3d 588, 600 (Tex. App.–Houston [14 th Dist.] 2009, pet. denied); see also Lundy,

260 S.W.3d at 501; Cotten v. Weatherford Bancshares, Inc., 187 S.W.3d 687, 698 (Tex.

App.–Fort Worth 2006, pet. denied). However, because not every relationship involving

a high degree of trust and confidence rises to the stature of a formal fiduciary relationship,

the law also recognizes the existence of an informal or confidential fiduciary relationship.

Meyer, 167 S.W.3d at 330. An informal fiduciary relationship may arise from a moral,

social, domestic, or purely personal relationship of trust and confidence. Id.; see Crim

Truck & Tractor Co. v. Navistar Int’l Transp. Corp., 823 S.W.2d 591, 594 (Tex. 1992);

Priddy, 282 S.W.3d at 600; Cotten, 187 S.W.3d at 698. The moral, social, domestic, or

personal relationship upon which the informal or confidential relationship is predicated

“‘must exist prior to, and apart from the agreement made the basis of the suit.’” Meyer, 167

S.W.3d at 331 (quoting Schlumberger Tech. Corp. v. Swanson, 959 S.W.2d 171, 177 (Tex.

1997)); Priddy, 282 S.W.3d at 600; see Hubbard v. Shankle, 138 S.W.3d 474, 483 (Tex. 44 App.–Fort Worth 2004, pet. denied) (“In other words, there must be a preexisting special

relationship of trust and confidence that is betrayed in later dealings.”). A person is

justified in placing confidence in the belief that another party will act in his best interest only

where he is accustomed to being guided by the judgment or advice of the other party and

there exists a long association in a business relationship as well as a personal friendship.

Hoggett v. Brown, 971 S.W.2d 472, 488 (Tex. App.–Houston [14th Dist.] 1997, pet.

denied); see Ins. Co. of Am. v. Morris, 981 S.W.2d 667, 674 (Tex. 1998) (providing that

“confidential relationships may arise when the parties have dealt with each other in such

a manner for a long period of time that one party is justified in expecting the other to act

in its best interest”). Moreover, mere subjective trust is insufficient to establish a

confidential relationship that gives rise to a fiduciary duty. Meyer, 167 S.W.3d at 331.

SJW argues on appeal that the evidence suggests that it was Palmer’s broker or,

in other words, Palmer’s agent at the Jackson Palmer Crossing development but not at the

Trenton Project. Instead, SJW contends that the evidence only supports a finding that

SJW was Palmer’s competitor at the Trenton Project site.

The relationship between agent and principal is a fiduciary relationship.

RESTATEMENT (SECOND ) OF AGENCY § 1 (1958). An agency relationship does not depend

upon the express appointment or assent by the principal; rather, it may be implied from the

conduct of the parties. Orozco v. Sander, 824 S.W.2d 555, 556 (Tex. 1992); see Ross v.

Tex. One P'ship, 796 S.W.2d 206, 210 (Tex. App.–Dallas 1990), writ denied per curium,

806 S.W.2d 222 (Tex. 1991); Mercedes-Benz of N. Am., Inc. v. Dickenson, 720 S.W.2d

844, 858 (Tex. App.–Fort Worth 1986, no writ). An agent is one who is authorized by

another to transact business or manage some affair for him. Welch v. Coca-Cola Enters.,

Inc., 36 S.W.3d 532, 539 (Tex. App.–Tyler 2000, pet. withdrawn). The existence of an 45 agency relationship may be established by circumstantial evidence based upon proof of

all the facts and circumstances that shows the relationship of the parties and throws light

upon the character of such relations. Id. at 540.

In finding that SJW breached a fiduciary duty to Palmer, the jury implicitly concluded

that Palmer was the principal and that SJW was his agent. SJW is correct in stating that

the record does not contain a contract expressly providing that SJW owed a fiduciary duty

to Palmer; however, as noted above, such a duty can be inferred from the conduct of the

parties. See Orozco, 824 S.W.2d at 556; Welch, 36 S.W.3d at 540; see also Ross, 796

S.W.2d at 210; Dickenson, 720 S.W.2d at 858.

Here, Palmer testified that he asked Stanley and Jay Williams, who were acting on

behalf of SJW, to be his broker at the Trenton Project and that Stanley and Jay agreed to

do so, as they had done at the Jackson Palmer Crossing development. The record reflects

that Palmer met with Stanley and Jay Williams on numerous occasions, including in Las

Vegas, to discuss confidential pricing and contractual information regarding the project and

that Palmer shared the information about the project so that SJW could get Dr. Kilgore

under contract and market the properties for development by Target. Palmer also met with

Jay Williams and Trozzo at a hunting lease in Encino, Texas, in order to discuss progress

on the Trenton Project, which included a discussion about Albertson’s being the anchor

tenant for the development in the event that Target could not be persuaded to participate

in the project.

Schwartz testified that he understood SJW to be Palmer’s broker for the Trenton

Project and that Palmer agreed to provide SJW a 6% commission for brokerage services.

Mark Freeland, a McAllen attorney that is board certified in residential, commercial, and

farm and ranch real estate law, noted that SJW first started acting as a broker for Palmer 46 at the Jackson Palmer Crossing in 1998, and that SJW began serving as Palmer’s broker

for the Trenton Project “around 2000.” Freeland also noted that he had “no doubt” that

SJW owed a fiduciary duty to Palmer regarding the Trenton Project and that Palmer’s

conveying of confidential pricing and contractual information and his request that SJW get

Dr. Kilgore under contract evidences the existence of the fiduciary duty. Another expert,

Charles Ray Porter Jr., a commercial real estate broker, testified that, based on his review

of the documents and testimony in this case, he believed that SJW owed a fiduciary duty

to Palmer, and if SJW did not intend to be Palmer’s broker at the Trenton Project, it should

have expressly disclaimed that such a duty existed at the Trenton Project, especially

considering the prior relationships of the parties at the Jackson Palmer Crossing

development.

SJW directs us to letters dated March 17, 2000 and March 21, 2000, in which

Palmer offered to sell the properties to SJW for $4.9 million, and SJW countered by

offering Palmer $2.6 million for the properties. SJW argues that these letters indicate that

the parties were competitors. This evidence appears to contradict the testimony provided

by Palmer, Schwartz, Freeland, and Porter. However, the reconciliation of such conflicting

evidence was within the province of the jury, and we must defer to the jury’s resolution so

long as the jury’s finding is reasonable. See City of Keller, 168 S.W.3d at 819. In

concluding that SJW breached a fiduciary duty owed to Palmer at the Trenton Project, the

jury clearly rejected SJW’s assertion that the March 17, 2000 and March 21, 2000 letters

evidenced that the parties were competitors.

Based on the foregoing, we conclude that the jury was reasonable in inferring that

a fiduciary relationship existed between SJW and Palmer. See Orozco, 824 S.W.2d at

556; Welch, 36 S.W.3d at 540; see also Ross, 796 S.W.2d at 210; Dickenson, 720 S.W.2d 47 at 858. Given that, we must now analyze the remaining elements of Palmer’s breach-of-

fiduciary-duty claim.

With respect to the breach and injury prongs of Palmer’s breach-of-fiduciary-duty

cause of action, several witnesses testified that SJW obtained confidential information from

Palmer regarding the Trenton Project and then used that information to get Dr. Kilgore

under contract in order to tie up the development of the project. In addition, the record

reflects that SJW approached and encouraged the landowners that Palmer had under

contract to breach their contracts with Palmer so that SJW could package the land together

itself for sale to Target. SJW also hid from Palmer the fact that it had Dr. Kilgore’s tract of

land, a crucial parcel of land to the development, under contract and that it was waiting

until Palmer’s contracts with the landowners expired to develop the land itself. As a result

of SJW’s actions, witnesses testified that Palmer suffered $709,587 in actual damages and

was forced to assign the properties to Target in exchange for the REA. However, once

Palmer received the REA, Trozzo, on behalf of SJW, bid up the price of the adjoining

Kayser tract to render the REA worthless or to force Palmer to incur additional

development expenses.

Viewing the evidence in the light most favorable to the jury’s verdict, we conclude

that the jury was reasonable in concluding that SJW owed Palmer a fiduciary duty and that

SJW breached that duty and caused injury to Palmer. See City of Keller, 168 S.W.3d at

807, 827. Thus, we hold that the evidence supporting the jury’s verdict as to Palmer’s

breach of fiduciary duty claim is legally sufficient. See id. On the other hand, viewing the

evidence in a neutral light, we cannot say that the jury’s verdict pertaining to Palmer’s

breach of fiduciary duty claim is so contrary to the overwhelming weight of the evidence

as to be clearly wrong and unjust; therefore, we hold that the evidence supporting the jury’s 48 verdict as to Palmer’s breach of fiduciary duty claim is factually sufficient. See Cain, 709

S.W.2d at 176.

D. Fraud

The elements of a cause of action for fraud are: (1) that a material representation

was made; (2) the representation was false; (3) when the representation was made, the

speaker knew it was false or made it recklessly without any knowledge of the truth and as

a positive assertion; (4) the speaker made the representation with the intent that the other

party should act upon it; (5) the party acted in reliance on the representation; and (6) the

party suffered injury as a result. Ernst & Young, L.L.P. v. Pac. Mut. Life Ins. Co., 51

S.W.3d 573, 577 (Tex. 2001); Bradford v. Vento, 48 S.W.3d 749, 754-55 (Tex. 2001). A

promise to do an act in the future constitutes fraud only when made with no intention of

performing the promise at the time the promise was made. Formosa Plastics Corp. USA

v. Presidio Eng'rs & Contractors, Inc., 960 S.W.2d 41, 48 (Tex.1998). The mere failure to

perform a contract is not evidence of fraud. Id. Fraudulent intent may be established by

either direct or circumstantial evidence, and the subsequent failure to perform the promise,

while not alone dispositive, can be considered with other factors to establish intent.

Spoljaric v. Percival Tours, Inc., 708 S.W.2d 432, 434-35 (Tex. 1986).

Here, the jury concluded that SJW committed fraud against Palmer and that Palmer,

through exercise of due diligence, should have discovered the fraud by September 8, 2000.

Palmer testified that he regularly met with SJW representatives to discuss confidential

pricing and contractual information regarding the Trenton Project and that he notified SJW

that he was unable to get Dr. Kilgore under contract. Palmer noted that SJW continued

to represent to him that they were working with Target to complete the development and

that they would work on getting Dr. Kilgore’s tract under contract in exchange for the 49 regular updates regarding pricing and contractual information pertaining to the project.

Palmer believed, and the jury agreed, that SJW was working as his broker on this project.

However, unknown to Palmer during his meetings with SJW representatives, SJW already

had Dr. Kilgore under contract, and, as noted by the landowners and Dr. Kilgore, SJW

intended to either wait until Palmer’s contracts with the landowners expired or induce the

landowners to breach their contracts with Palmer in order for SJW to develop the project

themselves. Later, Palmer discovered that Trozzo and Jay Williams had deceived him by

representing that they were working on getting Dr. Kilgore’s tract under contract for

Palmer’s benefit when, in fact, as Trozzo testified, SJW sought out Dr. Kilgore and got him

under contract for SJW’s benefit.

Palmer further testified that once he discovered the deceit of Trozzo and Jay

Williams, Stanley Williams contacted Palmer to resume the business relationship and

assured him and the landowners that Trozzo and Jay Williams would not have any further

involvement in the project. After receiving adequate assurances from Stanley Williams,

Palmer agreed to assign to Target the landowners’ property that he had under contract in

exchange for the REA, which was conditioned on Palmer’s purchase of the Kayser tract

within twelve months. Palmer later discovered that, despite Stanley’s assurances, Trozzo

remained involved in the project and subsequently bid up the price of the Kayser tract in

an attempt to render the REA worthless.

Based on our review of the record, we hold there is ample evidence for a reasonable

juror to conclude that SJW committed fraud upon Palmer. See Ernst & Young, L.L.P., 51

S.W.3d at 577; Bradford, 48 S.W.3d at 754-55; see also Spoljaric, 708 S.W.2d at 434-35.

The record indicates that SJW representatives repeatedly informed Palmer that they were

acting on Palmer’s behalf in getting Dr. Kilgore’s tract under contract and in assembling the 50 properties for sale to Target. Moreover, Stanley Williams, as president of SJW,

represented to Palmer that Trozzo and Jay Williams would not be involved in the project

after Palmer discovered the deception involving Dr. Kilgore’s tract of land. Both of these

representations were material to the transactions at issue. See Ernst & Young, L.L.P., 51

S.W.3d at 577; Bradford, 48 S.W.3d at 754-55. However, neither of these representations

were true, and a reasonable juror could infer that, at the time the representations were

made, SJW representatives were aware that the statements were false or that they made

them recklessly without knowledge of their veracity. See Ernst & Young, L.L.P., 51 S.W.3d

at 577; Bradford, 48 S.W.3d at 754-55. In addition, a reasonable juror could infer that the

representations were made to induce Palmer to: (1) disclose to SJW confidential pricing

and contractual information; and (2) assign the landowners’ properties to Target in

exchange for the REA, which Trozzo attempted to render worthless by bidding up the price

of the Kayser tract. See Ernst & Young, L.L.P., 51 S.W.3d at 577; Bradford, 48 S.W.3d

at 754-55; see also Spoljaric, 708 S.W.2d at 434-35. Finally, Palmer clearly relied upon

the representations made by SJW to further the development of the Trenton Project and,

according to his damages experts, sustained $709,587 in actual damages. See Ernst &

Young, L.L.P., 51 S.W.3d at 577; Bradford, 48 S.W.3d at 754-55.

Therefore, viewing the evidence in the light most favorable to the jury’s verdict, we

conclude that the jury was reasonable in concluding that SJW committed fraud upon

Palmer. See City of Keller, 168 S.W.3d at 807, 827. Thus, we hold that the evidence

supporting the jury’s verdict as to Palmer’s fraud claim is legally sufficient. See id. On the

other hand, viewing the evidence in a neutral light, we cannot say that the jury’s verdict

pertaining to Palmer’s fraud claim is so contrary to the overwhelming weight of the

evidence as to be clearly wrong and unjust; therefore, we hold that the evidence supporting 51 the jury’s verdict as to Palmer’s fraud claim is factually sufficient. See Cain, 709 S.W.2d

at 176. Accordingly, we overrule SJW’s second issue.23

V. THE DAMAGE AWARD

By its third issue, SJW argues that the jury’s damage awards are not supported by

legally and factually sufficient evidence. In particular, SJW challenges: (1) the damage

calculations made by Palmer’s expert, Abington, as speculative; and (2) the jury’s finding

that SJW acted with malice in allegedly intentionally interfering with Palmer’s earnest

money contracts. The Palmer companies contend that the jury’s damage awards are

supported by legally and factually sufficient evidence. The Palmer companies highlight the

fact that SJW did not object to Abington’s damages model and testimony at trial.

Furthermore, the Palmer companies argue that the punitive damages cap does not apply,

and the jury was not required to find that a vice-principal of SJW intentionally interfered

with Palmer’s earnest money contracts in order to sustain the punitive damage awards.

A. The Jury’s Award of Actual Damages to the Palmer Companies

1. Standard of Review and Applicable Law

On appeal, SJW challenges the legal and factual sufficiency of the jury’s actual

damages award. We review the jury’s actual damages award under the same well-

established legal and factual sufficiency standards outlined in Part IV(A) of this opinion.

We do note, however, that actual damages are a prerequisite to an exemplary damage

award. See TEX . CIV. PRAC . & REM . CODE ANN . § 41.004(a) (Vernon 2008); see also Wright

v. Gifford-Hill & Co., 725 S.W.2d 712, 713-14 (Tex. 1987); Swinnea v. ERI Consulting

23 W e need not address the Palm er com panies’ tortious interference with prospective business relations claim s because we have already concluded that the evidence supporting the Palm er com panies’ tortious interference with a contract claim was supported by legally and factually sufficient evidence and the jury charge did not segregate the two claim s. See T EX . R. A PP . P. 47.1. The jury was m erely questioned as to whether SJW intentionally interfered with Palm er’s earnest m oney contracts. 52 Eng’rs, Inc., 236 S.W.3d 825, 842 (Tex. App.–Tyler 2007, pet. granted). Therefore, if we

were to find that the jury’s actual damages award was not supported by legally and

factually sufficient evidence, then we would not need to analyze the jury’s exemplary

damages award.

When a party properly objects to a jury question, we review the sufficiency of the

evidence in the light of the charge that the trial court should have submitted. W.L.

Lindemann Operating Co. v. Strange, 256 S.W.3d 766, 775 (Tex. App.–Fort Worth 2009,

no pet.). Absent an objection to the jury charge, the sufficiency of the evidence is reviewed

in light of the charge submitted. Id. (citing Wal-Mart Stores, Inc. v. Sturges, 52 S.W.3d

711, 715 (Tex. 2001); City of Fort Worth v. Zimlich, 29 S.W.3d 62, 71 (Tex. 2000)). Here,

SJW did not object to any questions contained in the jury charge that pertained to the

calculation of damages; thus, we review the sufficiency of the damage awards in light of

the charge submitted. See id.; see also Sturges, 52 S.W.3d at 715; Zimlich, 29 S.W.3d

at 71.

2. Discussion

On appeal, SJW argues that the evidence supporting the jury’s actual damages

awards is insufficient because Abington’s calculations are speculative in nature and,

therefore, amounted to no evidence.

In question number 22 of the charge, the jury was asked to determine the amount

of money that would fairly and reasonably compensate Palmer for his damages, if any, that

were proximately caused by SJW’s conduct. The charge did not specifically attribute this

damage question to any particular cause of action; therefore, it could have applied to the

Palmer companies’ fraud, breach of fiduciary duty, or tortious interference causes of

53 action.24 In any event, the jury concluded that Palmer sustained: (1) $376,397 in damages

for lost profits from the Robinson tract delay; (2) $207,926 in damages for lost profits from

the rental revenue delay on the Kayser tract; and (3) $125,264 in damages for lost profits

from the property sale delay also on the Kayser tract. The jury’s actual damages calculation

is premised on evidence submitted by the Palmer companies as to lost profits.

“Lost profits are damages for the loss of net income to a business measured by

reasonable certainty.” Miga v. Jensen, 96 S.W.3d 207, 213 (Tex. 2002); see Bossier

Chrysler Dodge II, Inc. v. Rauschenberg, 201 S.W.3d 787, 808 (Tex. App.–Waco 2006),

rev’d in part, 238 S.W.3d 376 (Tex. 2007) (per curiam). “Net profits” are defined as “what

remains in the conduct of a business after deducting from its total receipts all of the

expenses incurred in carrying on the business.” Turner v. PV Int’l Corp., 765 S.W.2d 455,

465 (Tex. App.–Dallas 1988, writ denied) (citing R.A. Corbett Transp., Inc. v. Oden, 678

S.W.2d 172, 176 (Tex. App.–Tyler 1984, no writ)). “Thus, in order to recover lost profits,

damages must be shown with ‘reasonable certainty’[;] net profits must be shown by

objective, rather than subjective, facts, figures, and data.” Turner, 765 S.W.2d at 465

(quoting Automark of Tex. v. Discount Trophies, 681 S.W.2d 828, 830 (Tex. App.–Dallas

1984, no writ)) (emphasis in original). “Recovery for lost profits does not require that the

loss be susceptible to exact calculation”; however “[a]t a minimum, opinions or lost-profit

estimates must be based on objective facts, figures, or data from which the lost-profits

amount may be ascertained.” Helena Chem Co. v. Wilkins, 47 S.W.3d 486, 504 (Tex.

2001) (citing Szczepanik v. First S. Trust Co., 883 S.W.2d 648, 649 (Tex. 1994); Tex.

24 SJW did not challenge, in the trial court, the charge’s wording regarding the actual dam ages award and the fact that the question pertaining to actual damages is not attributed to a particular cause of action. See Religious of the Sacred Heart of Tex. v. City of Houston, 836 S.W .2d 606, 613-14 (Tex. 1992) (holding that any com plaint as to the wording of the jury charge is waived if a proper objection is not m ade in the trial court). 54 Instruments, Inc. v. Teletron Energy Mgmt., Inc., 877 S.W.2d 276, 279 (Tex. 1994); Holt

Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 84 (Tex. 1992)); see Sw. Battery Corp. v.

Owen, 131 Tex. 423, 115 S.W.2d 1097, 1098-1099 (1938); Orchid Software, Inc. v.

Prentice-Hall, Inc., 804 S.W.2d 208, 211 (Tex. App.–Austin 1991, writ denied). The Helena

Chemical court further noted that:

We have held that past profits, coupled with other facts and circumstances, may establish a lost-profits amount with reasonable certainty. However, lack of a profit history does not, by itself, preclude a new business from recovering lost future profits. Rather, our focus is on whether damages can be shown with reasonable certainty. This can be accomplished with a profit history or some other objective data, such as future contracts, from which lost profits can be calculated with reasonable certainty.

47 S.W.3d at 505 (citations omitted) (emphasis in original).

The Palmer companies called Abington to testify on damages sustained as a result

of SJW’s wrongful conduct. Additionally, Abington provided numerous spreadsheets, which

were admitted into evidence, to corroborate his testimony. After reviewing the evidence

contained in the record, Abington concluded that the Palmer companies sustained $709,587

in actual damages. This calculation was comprised of three figures: (1) $376,397 in lost

profits on the Robinson tract delay; (2) $207,926 in lost profits on delayed rental revenue;

and (3) $125,264 in lost profits on the delayed sale of the properties.

In calculating damages associated with the Robinson tract delay, Abington relied on

Palmer’s earnest money contracts with Opal Baldwin, Wayne and Gelee Allen, Harlon and

Mary Robinson, Yvonne Robinson, and Whisenant and assumed that all five of the

contracts were effective on April 15, 2000, and were assigned to Target for no profit on

June 15, 2001.25 This accounted for a fourteen month delay. Abington then calculated a 25 Abington testified that when he m ade his conclusions, he did not have contracts for two of the landowners that conclusively established effectiveness in April 2000, which appears to contradict the testim ony of Palm er, W ayne Allen, and Schwarz that the contracts existed. Abington did note that he did have contracts for all five landowners that were effective in October 2000. For the two April 2000 contracts that 55 sales price for the land to be $2,950,101, which was based on representations made by

Target as to the maximum price it would pay for the land—$4.50 per square foot for 15.05

acres.26 Abington then subtracted the prices Palmer agreed to purchase the landowners’

land for and closing costs, which appears to include the 6% commission fee included in

each earnest money contract. The total costs amounted to $2,573,704, and the net profit

amounted to $376,397.

With regard to his second calculation, Abington analyzed damages involving delayed

rental income from the Kayser tract. Regarding the delays, Abington assumed a twelve-

month delay, which was less than the actual nineteen-month delay to which Palmer

testified—from the time Palmer and Kayser began negotiating, and Kayser’s alleged

approval of Palmer’s $1.96 million offer around July 2000 to when the property was finally

sold to Palmer in February 2002. Abington relied on a spreadsheet documenting actual

rental payments made by businesses that were situated on the Kayser tract near the time

of trial and determined that the assumed twelve-month delay on the account of SJW’s

wrongful actions Palmer lost $3,326,823 in rental income. Abington then used a

conservative estimate of 6.25% for cost of capital and ultimately concluded that the Palmer

companies sustained $207,926 in losses of rental income associated with the Kayser tract

after subtracting “[a]ny expenses associated with really running the property.”

Abington’s final damages calculation addressed losses sustained by the Palmer

companies as to the sale of portions of the Kayser tract to Bank of America, Jack-in-the-

were allegedly m issing, Abington used the prices quoted in the corresponding October 2000 contracts and adjusted them by 3.85% to “roll them back to April 2000 prices,” which was a low estim ate for the price difference between April 2000 and October 2000, based on the average price differentials for Palm er’s other earnest m oney contracts. Abington stressed that such calculations were necessary because, as a dam ages expert, he is charged with determ ining “[w]hat would have reasonably been expected to have occurred” and because that was what was contem plated to happen in April 2000, by the Palm er com panies.

26 Target eventually acquired the property for approxim ately $3.98 per square foot. 56 Box, and Logan’s Roadhouse. Abington noted that: (1) Bank of America bought a portion

of the Kayser tract on June 5, 2003, for $566,636; (2) Jack-in-the-Box bought a portion of

the Kayser tract on October 15, 2004, for $566,711; and (3) Logan’s Roadhouse bought

another portion of the Kayser tract on September 1, 2004, for $870,875. The sum total of

these sales amounted to $2,004,222. Abington, once again, multiplied the sales amount

by a conservative measure for cost of capital—6.25%—to arrive at his damage calculation

of $125,264.

Based on the damages awarded by the jury, it is clear that the jury agreed with

Abington’s damages calculations. Furthermore, based on the foregoing, we conclude that

the Palmer companies’ damages evidence described, with reasonable certainty, the profits

they lost; therefore, we cannot say that the jury was unreasonable in adopting Abington’s

damages calculations. See City of Keller, 168 S.W.3d at 807, 810-11; see also Miga, 96

S.W.3d at 213; Helena Chem Co., 47 S.W.3d at 504-05; Rauschenberg, 201 S.W.3d at

808. Abington provided the jury with ample documentary and testimonial evidence that was

objective in nature and allowed the jury to determine the proper amount of actual damages

to award. Helena Chem Co., 47 S.W.3d at 504; Szczepanik, 883 S.W.2d at 649; Teletron

Energy Mgmt., Inc., 877 S.W.2d at 279; Heine, 835 S.W.2d at 84; see Orchid Software,

Inc., 804 S.W.2d at 211. Moreover, SJW did not offer any evidence contradicting

Abington’s calculations, nor did it object to the admission of Abington’s testimony or exhibits

as to damages.

We note that in virtually all damages calculations, there is some degree of

subjectivity involved, especially when forecasting future profits and losses. However, we

do not believe that the evidence submitted by the Palmer companies as to actual damages

was speculative in nature or failed to describe with reasonable certainty the damages 57 sustained. Thus, we cannot say that the jury’s actual damages award, viewed in a neutral

light, was so contrary to the overwhelming weight of the evidence as to be clearly wrong or

unjust. See Cain, 709 S.W.2d at 176. Accordingly, we uphold the jury’s actual damages

award and overrule SJW’s third issue to the extent that it challenges the jury’s actual

damages award.

B. The Jury’s Award of Exemplary Damages Against SJW

1. Standard of Review

Exemplary damages must be established by clear and convincing evidence; thus,

an elevated standard of review. Sw. Bell Tel. Co. v. Garza, 164 S.W.3d 607, 627 (Tex.

2004); see TEX . CIV. PRAC . & REM . CODE ANN . § 41.003(a) (Vernon Supp. 2009). Clear and

convincing evidence is that “measure or degree of proof that will produce in the mind of the

trier of fact a firm belief or conviction as to the truth of the allegations sought to be

established.” TEX . CIV. PRAC . & REM . CODE ANN . § 41.001(2) (Vernon 2008); see Transp.

Ins. Co. v. Moriel, 879 S.W.2d 10, 31 (Tex. 1994). This intermediate standard falls between

the preponderance standard of civil proceedings and the reasonable doubt standard of

criminal proceedings. In re G.M., 596 S.W.2d 846, 847 (Tex. 1980); State v. Addington,

588 S.W.2d 569, 570 (Tex. 1979); see Strange, 256 S.W.3d at 775. “While the proof must

weigh heavier than merely the greater weight of the credible evidence, there is no

requirement that the evidence be unequivocal or undisputed.” Strange, 256 S.W.3d at 775

(citing Addington, 588 S.W.2d at 570).

B. Discussion

On appeal, SJW specifically asserts that: (1) the evidence supporting the jury’s

malice finding is legally and factually insufficient; and (2) the “cap buster” provisions of

58 section 41.008 of the civil practice and remedies code were not properly plead; therefore,

the jury’s exemplary award was excessive.27

1. The Jury’s Malice Finding

Under legal sufficiency review, when a jury makes an affirmative finding of malice,

we review all of the evidence in the light most favorable to the jury’s finding, taking into

account contrary disputed facts, to determine whether reasonable jurors could have formed

a firm belief or conviction regarding malice. Qwest Int’l Commc’ns, Inc. v. AT&T Corp., 167

S.W.3d 324, 326 (Tex. 2005); see also Garza, 164 S.W.3d at 627; In re J.F.C., 96 S.W.3d

256, 266 (Tex. 2002). Under factual sufficiency review, we give due consideration to any

evidence the fact finder could reasonably have found to be clear and convincing. In re

J.F.C., 96 S.W.3d at 266. We must consider the disputed evidence and determine whether

a reasonable fact finder could have resolved that evidence in favor of the finding. Id. The

evidence is factually insufficient if, in light of the entire record, the disputed evidence that

a reasonable fact finder could not have credited in favor of its finding is so significant that

a fact finder could not have reasonably formed a firm conviction or belief. Id.

Here, question number 25 of the charge asked the jury whether there was “clear and

convincing evidence that the harm to G.J. Palmer, Jr. resulted from malice.” The charge

further explained that “‘[m]alice’ means a specific intent by SJW Property Commerce, Inc.

to cause substantial injury or harm to G.J. Palmer, Jr.” See TEX . CIV. PRAC . & REM . CODE

ANN . § 41.001(7) (defining malice as “a specific intent by the defendant to cause substantial

injury or harm to the claimant”). The jury answered in the affirmative to question number

25 of the charge. The Palmer companies were subsequently awarded $2 million in 27 SJW also argues that the jury’s exem plary dam age award was erroneous because the Palm er com panies’ did not “subm it a question asking if an em ployee of PCDC com m itted an intentional tort.” However, because we have concluded that the Palm er com panies’ claim s against PCDC are tim e-barred, we need not address this contention. See T EX . R. A PP . P. 47.1. 59 exemplary damages against SJW. The trial court’s final judgment adopted the jury’s

exemplary damages award.

The evidence shows that Stanley and Jay Williams and Trozzo were all associated

with SJW and that their actions served as the basis of the Palmer companies’ causes of

action. Stanley testified that he had retired ten to twelve years prior to this dispute and that

he merely facilitated the development of the Trenton Project. However, Stanley later

seemed to contradict himself when he admitted that he consults with Jay Williams, the

president and owner of SJW, about deals “about every hour.” Furthermore, Palmer alleged

that Stanley was heavily involved in the development of the Trenton Project because he

directed the actions of Jay Williams and Trozzo, and Stanley met with Palmer to negotiate

the assignment of Palmer’s earnest money contracts in exchange for the REA. In addition,

prior to negotiating the assignment of Palmer’s earnest money contract in exchange for the

REA, Stanley agreed to no longer allow Jay Williams and Trozzo to be involved in the

development of the Trenton Project. However, shortly after negotiations were finalized,

Trozzo bid up the price of the Kayser tract to apparently render Palmer’s REA worthless.

Moreover, the record reflects that: (1) Jay Williams actively participated in the

development of the Trenton Project; (2) several witnesses recalled seeing Jay Williams at

various meetings to discuss the progress of the Trenton Project; and (3) Jay Williams

signed most of the relevant documents in this dispute in his capacity as president of SJW.

Trozzo, Jay Williams’s brother-in-law, testified that: (1) he is “an independent contractor”

who works for SJW; and (2) as an employee of SJW, he typically takes direction from Jay

Williams.

In addition, Dr. Kilgore testified as to SJW’s actions to get him under contract to tie

up the Trenton Project until Palmer’s earnest money contracts expired so that SJW could 60 develop the property itself. Furthermore, Wayne Allen testified that the landowners were

approached by Trozzo to induce them to terminate their contracts with Palmer and sign new

contracts with SJW. These actions transpired all the while Palmer, Schwarz, and the

landowners believed that SJW was acting as Palmer’s broker on the development project.

In fact, Porter testified at trial that he reviewed the depositions, documents, and pleadings

in this case and the Real Estate License Act and other ethical rules promulgated by the

Texas Real Estate Commission and, based on that information, concluded that an agency

relationship existed between SJW and Palmer at the Trenton Project.

Another expert, Mark Freeland, confirmed Porter’s findings and testified that he

believed SJW began working as Palmer’s broker at the Trenton Project in 2000. Freeland

also noted that the correspondences between SJW and Palmer did not contain a

correspondence from SJW expressing that it was not Palmer’s broker at the Trenton

Project. Freeland stated that the course of conduct between SJW and Palmer at the

Trenton Project gave rise to an agency relationship and the expiration of the Listing

Agreement at the Jackson Palmer Crossing site had no bearing on the existence of the

agency relationship at the Trenton Project. Porter and Freeland’s conclusions as to agency

were contested by SJW; however, the jury ultimately concluded that an agency relationship

existed between SJW and Palmer.

The record also demonstrates that Palmer regularly discussed confidential pricing

and contractual information with Stanley and Jay Williams at various meetings even though

SJW later argued at trial that the parties were competitors. However, SJW never once

disclosed to Palmer that the parties were competitors, nor did it request that Palmer

discontinue revealing confidential information regarding the Trenton Project.

We find that the evidence supports a finding that SJW authorized, ratified, or adopted 61 the acts of malice perpetrated by Stanley and Jay Williams and Trozzo, and that, in

particular, Jay Williams, president of SJW, participated in the wrongful conduct that

transpired at the Trenton Project. See Qwest Int’l Commc’ns, 167 S.W.3d at 326 (stating

that a corporation is liable for exemplary damages only if it: (1) authorizes or ratifies an

agent’s malice, (2) maliciously hires an unfit agent, or (3) acts with malice through a vice

principal) (citing Mobil Oil Corp. v. Ellender, 968 S.W.2d 917, 921-22 (Tex. 1998);

Hammerly Oaks, Inc. v. Edwards, 958 S.W.2d 387, 391 (Tex. 1997) (defining a “vice

principal” as (1) a corporate officer; (2) those who have authority to employ, direct, and fire

employees; (3) those who engage in non-delegable duties; and (4) those is charge of the

management of a department or division of the business)). In reviewing the evidence in the

light most favorable to the jury’s malice finding, we conclude that reasonable jurors could

have formed a firm belief or conviction regarding malice. See Qwest Int’l Commc’n, Inc.,

167 S.W.3d at 326; see also Garza, 164 S.W.3d at 627; In re J.F.C., 96 S.W.3d at 266. We

further conclude that, in light of the entire record, the jury was reasonable in concluding that

SJW’s actions at the Trenton Project were malicious. See In re J.F.C., 96 S.W.3d at 266.

2. The “Cap Buster” Provisions of the Texas Civil Practice and Remedies Code

Section 41.008 of the civil practice and remedies code allows for the recovery of two

times the amount of economic damages plus an amount equal to any non-economic

damages found by the jury, not to exceed $750,000. See TEX . CIV. PRAC . & REM . CODE ANN .

§ 41.008 (Vernon Supp. 2009). “[T]he amount of exemplary damages to be awarded is

within the discretion of the trier of fact.” Id. § 41.010(b) (Vernon 2008). The following

factors are relevant to the assessment of the amount of exemplary damages that should

be assessed against a tortfeasor: (1) the nature of the wrong; (2) the character of the

62 conduct involved; (3) the degree of culpability of the wrongdoer; (4) the situation and

sensibilities of the parties concerned; (5) the extent to which the conduct offends a public

sense of justice and propriety; and (6) the net worth of the defendant. Id. § 41.011(a)

(Vernon 2008). In our opinion, we must “address the evidence or lack of evidence with

specificity” as it relates to the statutory requirements. Id. § 41.013(a) (Vernon 2008).

On April 10, 2007, SJW first invoked section 41.008's exemplary damages cap. This

filing preceded the commencement of the trial in this dispute by six days.28 The Palmer

companies filed their opposition to SJW’s April 10, 2007 filing, alleging that the filing was

prejudicial on its face and requesting that motion for leave be denied. See Chapin &

Chapin, Inc. v. Tex. Sand & Gravel Co., 844 S.W.2d 664, 664 (Tex. 1992) (per curiam)

(“Rule 63, [of the Texas Rules of Civil Procedure] states that pleadings may be amended

within seven days of trial only after leave of the judge is obtained, which leave shall be

granted by the judge unless there is a showing that such filing will operate as a surprise to

the opposite party.”); see also TEX . R. CIV. P. 63. Texas courts have held that the punitive

damage cap must be pleaded and proved. See Shoreline, Inc. v. Hisel, 115 S.W.3d 21, 25

(Tex. App.–Corpus Christi 2003, pet. denied) (“Where maximum damages are provided in

statutes in Texas, and a defendant wants to rely on the cap, it is considered a defense that

must be plead and proved.”) (citing TEX . R. CIV. P. 94; Horizon/CMS Healthcare Corp. v.

Auld, 34 S.W.3d 887, 896-97, 904-05 (Tex. 2000)); see also Marin v. IESI TX Corp., No.

01-08-00539-CV, 2010 Tex. App. LEXIS 981, at *45 (Tex. App.–Houston [1st Dist.] Feb. 11,

2010, no pet. h.) (mem. op.) (noting that section 41.008's exemplary damages cap is an

affirmative defense that must be pleaded); Wackenhut Corr. Corp. v. De La Rosa, 305

S.W.3d 594, 651 (Tex. App.–Corpus Christi 2009, no pet.) (same). Moreover, the failure

28 Trial in this m atter com m enced on April 16, 2007. 63 to raise a new defense via an amended pleading more than seven days before trial without

leave constitutes surprise and is prejudicial on its face if it does not give plaintiff “fair notice”

of defendant’s intent to invoke the cap. See Chapin & Chapin, Inc., 844 S.W.2d at 664; see

also Horizon/CMS Healthcare Corp., 34 S.W.3d at 896-97.

Here, the record does not reflect that the trial court granted SJW leave to file its late

April 10, 2007 pleading first asserting the exemplary damages cap. See TEX . R. CIV. P. 63.

Furthermore, the jury was presented with a charge that did not include language pertaining

to section 41.008's exemplary damages cap and subsequently awarded the Palmer

companies $709,587 in actual damages and $2 million in exemplary damages. The jury’s

damages award was not broken into economic and non-economic damages; however, we

presume that the jury’s $709,587 actual damages award constituted an economic damages

award and that no non-economic damages were awarded. Thus, the jury’s $2 million

exemplary damages award constituted more than two times the amount of economic

damages awarded by jury. See TEX . CIV. PRAC . & REM . CODE ANN . § 41.008. Because

section 41.008 mandates that exemplary damages are limited to two times the amount of

economic damages awarded, plus non-economic damages, not to exceed $750,000, and

the jury was awarded more than two times the amount of economic damages awarded, we

cannot say that section 41.008's exemplary damages cap was considered by the jury. See

id. Based on the foregoing, we conclude that the jury’s failure to impose the exemplary

damages cap and the lack of evidence demonstrating that the trial court granted SJW leave

to file its April 10, 2007 pleading demonstrates that the trial court refused to grant SJW

leave to file its late filing and implicitly concluded that SJW’s late filing operated as a

64 surprise to the Palmer companies.29 See TEX . R. CIV. P. 63. Because SJW was required

to properly plead section 41.008's exemplary damages cap and failed to do so, we conclude

that the damages cap was not properly before the jury.

Based on our review of the record, we further conclude that the Palmer companies

proved by clear and convincing evidence that they were entitled to an exemplary damages

award based on SJW’s malicious conduct at the Trenton Project. See Garza, 164 S.W.3d

at 627; see also TEX . CIV. PRAC . & REM . CODE ANN . § 41.003(a). Employing the proper

standards of review, we hold that the evidence supporting the jury’s exemplary damage

award is legally and factually sufficient. See Qwest Int’l Commc’n, Inc., 167 S.W.3d at 326;

see also Garza, 164 S.W.3d at 627; In re J.F.C., 96 S.W.3d at 266. Accordingly, we

overrule SJW’s third issue as it pertains to the jury’s exemplary damages award.

VI. ATTORNEY’S FEES AND EXPENSES AWARDED TO PALMER

In their fourth and final issue, SJW argues that the Palmer companies are not entitled

to attorney’s fees because a plaintiff in a tortious interference with an existing contract

cause of action may only recover actual damages rather than attorney’s fees. SJW further

argues that the Palmer companies cannot recover attorney’s fees under article 6.04 of the

Listing Agreement because the Palmer companies did not prevail on the cause of

action—the failure to pay commissions for bringing tenants to the Jackson Palmer Crossing

shopping center—brought under the Listing Agreement. The Palmer companies claim

29 The Palm er com panies argue on appeal that it did not have tim e to specifically plead any “cap busting” theories because of SJW ’s late filing. Moreover, the Palm er com panies highlight the fact that SJW did not object to any of the charge questions that pertained to dam ages, m uch less request that the charge include language about the exem plary dam ages cap. See Allen v. Am. Natural Ins. Co., 380 S.W .2d 604, 609 (Tex. 1964) (“‘W here, however, the ground (of recovery or defense) is subm itted, however erroneously or incom pletely, the parties are thereby put upon notice that the jury’s answers to the issues actually subm itted will form the basis of the court’s judgm ent thereafter to be rendered thereon. It then becomes the duty of each party to point out errors of omission or com mission, or be held estopped from thereafter urging them.’”) (quoting Panhandle & S. F. Ry. Co. v. Friend, 91 S.W .2d 922, 930 (Tex. Civ. App.–Austin 1936, no writ)) (em phasis in original). 65 entitlement to the jury’s attorney’s fees award because they prevailed on their counterclaims

and the Listing Agreement provides that attorney’s fees may be awarded to the prevailing

party for any action or proceeding relating to the agreement.

A. Standard of Review and Applicable Law

An award of attorney's fees is reviewed under an abuse of discretion standard. Dail

v. Couch, 99 S.W.3d 390, 391 (Tex. App.–Corpus Christi 2003, no pet.) (citing Ragsdale

v. Progressive Voters League, 801 S.W.2d 880, 881 (Tex. 1990)). The test for abuse of

discretion is to determine whether the trial court acted without reference to any guiding rules

or principles, or whether, under the circumstances of the case, the trial court's actions were

arbitrary or unreasonable. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42

(Tex. 1985).

“Under the American Rule, litigants’ attorney’s fees are recoverable only if authorized

by statute or by a contract between the parties.” Intercontinental Group P’ship v. KB Home

Lone Star, L.P., 295 S.W.3d 650, 653 (Tex. 2009) (citing MBM Fin. Corp. v. Woodlands

Operating Co., 292 S.W.3d 660, 669 (Tex. 2009) (citing Tony Gullo Motors I, L.P. v. Chapa,

212 S.W.3d 299, 310-11 (Tex. 2006))). Section 38.001 of the civil practice and remedies

code provides that reasonable attorney’s fees may be recovered:

from an individual or corporation, in addition to the amount of a valid claim and costs, if the claim is for:

(1) rendered services;

(2) performed labor;

(3) furnished material;

(4) freight or express overcharges;

(5) lost of damaged freight or express;

66 (6) killed or injured stock;

(7) a sworn account; or

(8) an oral or written contract.

TEX . CIV. PRAC . & REM . CODE ANN . § 38.001 (Vernon 2008). The supreme court has held

that “before a party is entitled to fees under section 38.001, that ‘party must (1) prevail on

a cause of action for which attorney’s fees are recoverable, and (2) recover damages.’” KB

Home Lone Star, L.P., 295 S.W.3d at 653 (citing Green Int’l, Inc. v. Solis, 951 S.W.2d 384,

390 (Tex. 1997)).

B. Discussion

The record reflects that the parties submitted their attorney’s fees calculations to the

trial court by agreement.30 See Tittizer v. Union Gas Corp., 171 S.W.3d 857, 860 (Tex.

2005) (per curiam) (“As a general rule, the doctrine of estoppel precludes a litigant from

requesting a ruling from a court and then complaining that the court committed error in

giving it to him.”); see also Naguib v. Naguib, 137 S.W.3d 367, 375 (Tex. App.–Dallas 2004,

pet. denied) (recognizing the “invited error” doctrine and noting that “[a] party to a lawsuit

cannot ask something of a trial court and then complain on appeal that the trial court

committed error in granting that party’s request”). In any event, after reviewing the Listing

Agreement and the testimony adduced at trial, we agree with SJW that the Listing

Agreement is not an adequate basis for awarding the Palmer companies attorney’s fees

because the unambiguous language of the Listing Agreement solely pertains to the Jackson

Palmer Crossing site. Our earlier conclusion that the disputes at Jackson Palmer Crossing

and the Trenton Project constituted a single transaction or occurrence centered on the 30 In support of their attorney’s fees request, the Palm er com panies tendered affidavits from co- counsel at trial, Sarah Pierce Cowen and John R. Griffith, requesting $289,582 as reasonable attorney’s fees and $100,570.23 in reasonable expenses. On appeal, SJW does not challenge the reasonableness of the Palm er com panies’ attorney’s fees requests. 67 parties’ relationship, conduct, and correspondence with one another rather than construing

the breadth of the Listing Agreement to include the Trenton Project. Nowhere in the Listing

Agreement do the parties indicate that they intended for the agreement to cover properties

other than those situated at the Jackson Palmer Crossing site.

SJW only cites us to one case supporting its contention that a plaintiff cannot recover

attorney’s fees for an action for tortious interference with an existing contract. See

Browning-Ferris, Inc. v. Reyna, 852 S.W.2d 540, 549 (Tex. App.–San Antonio 1992), rev’d

on other grounds, 865 S.W.2d 925 (Tex. 1993). The Reyna case, however, does not

mention the propriety of an attorney’s fees award in a tortious interference with an existing

contract claim. See id. Therefore, we do not find this case to be persuasive as to this

issue.

As noted previously, the disputes at Jackson Palmer Crossing and the Trenton

Project are related so as to constitute a single transaction or occurrence. The crux of the

dispute pertaining to the Trenton Project involves SJW’s rendering of brokerage services,

or lack thereof, to the Palmer companies, which falls under the purview of section 38.001

of the civil practice and remedies code. See TEX . CIV. PRAC . & REM . CODE ANN . § 38.001(1).

The trial court did not abuse its discretion in awarding the Palmer companies attorney’s fees

because SJW was judicially estopped from complaining about the attorney’s fees award

given that SJW and the Palmer companies submitted their attorney’s fees requests by

agreement and because the Palmer companies prevailed and were awarded damages on

their counterclaims, which were based on the SJW’s rendering of brokerage services, or

lack thereof, at the Trenton Project. See id.; see also KB Home Lone Star, L.P., 295

S.W.3d at 653; Downer, 701 S.W.2d at 241-42; Dail, 99 S.W.3d at 391.

However, on rehearing, SJW contends that, because Palmer’s counterclaim was one 68 for tortious interference with contracts, he was not entitled to recover his attorney’s fees.

SJW relies heavily on our holding in Alma Group, L.L.C. v. Palmer, 143 S.W.3d 840, 845-46

(Tex. App.–Corpus Christi 2004, pet. denied), to support its contention. We disagree with

SJW’s argument that Palmer is not entitled to the recovery of his attorney’s fees in this

matter.

In Alma Group, we denied Palmer his attorney’s fees because he “did not prove or

recover any damages on either his breach-of-contract or tortious-interference causes of

action.” Id. at 846. In a footnote, we also stated that “there is no statutory or contractual

basis for recovery of attorney fees for a tortious-interference claim.” Id. at 846 n.5 (citing

Ed Rachal Found. v. D’Unger, 117 S.W.3d 348, 357 (Tex. App.–Corpus Christi 2003),

reversed in part on other grounds, 207 S.W.3d 330 (Tex. 2006); Martin-Simon v. Womack,

68 S.W.3d 793, 797 (Tex. App.–Houston [14th Dist.] 2001, pet. denied)). While SJW is

correct in stating that attorney’s fees are not recoverable for tortious-interference-with-

contract claims, we, again, note that the crux of the dispute pertaining to the Trenton Project

involves the rendition of brokerage services, which, as stated above, falls within the purview

of section 38.001 of the civil practice and remedies code. See TEX . CIV. PRAC . & REM . CODE

ANN . § 38.001(1). Moreover, the record reflects that Palmer prevailed on his causes of

action and was awarded damages for not only his tortious-interference-with-contract claims,

but also his fraud and breach of fiduciary duty claims. See Solis, 951 S.W.2d at 390.

Therefore, given the facts of this case, we do not find the Alma Group case to be applicable.

Accordingly, we overrule SJW’s fourth issue.

VII. SUFFICIENCY OF THE EVIDENCE THAT APPELLEES WRONGFULLY WITHHELD THE PAYMENT OF COMMISSIONS ASSOCIATED WITH JACKSON PALMER CROSSING

By their sole cross-issue, the Palmer companies contend that the jury’s award for

69 commissions associated with the Jackson Palmer Crossing shopping center is not

supported by legally and factually sufficient evidence. Specifically, the Palmer companies

argue that the Listing Agreement was not enforceable because it lacked an adequate

description of the property involved. SJW responds by arguing that the evidence supports

the jury’s finding that commissions were owed by the Palmer companies, especially

considering Palmer’s admissions at trial that he owed the commissions and that SJW

brought several tenants to the Jackson Palmer Crossing shopping center. SJW also

asserts that the Palmer companies’ argument that the contract was unenforceable “is both

untenable and unsupported in law or fact.”

A. Applicable Law

In arguing that the Listing Agreement was an unenforceable contract, the Palmer

companies rely on section 1101.806(c) of the Texas Occupations Code. See TEX . OCC .

CODE ANN . § 1101.806(c) (Vernon 2004). Section 1101.806(c) provides as follows:

A person may not maintain an action in this state to recover a commission for sale or purchase of real estate unless the promise or agreement on which the action is based, or a memorandum, is in writing and signed by the party against whom the action is brought or by a person authorized by that party to sign the document.

Id.; see Trammel Crow Co. No. 60 v. Harkinson, 944 S.W.2d 631, 633 (Tex. 1997).

B. Discussion

On appeal, the Palmer companies complain about a document, labeled “Exhibit A,”

which was attached to the Listing Agreement and presented at trial. Palmer testified at trial

that “Exhibit A” was a “site plan” for the Jackson Palmer Crossing development “that was

never part of the original agreement.” The Palmer companies allege that the failure to

tender “Exhibit A” at the time the document was signed made the Listing Agreement

unenforceable because it did not contain an adequate description of the property in 70 question. The Palmer companies also allege that section 1101.806(c) required that the

Listing Agreement contain an adequate description of the property. We disagree with the

Palmer companies’ contentions.

With respect to “Exhibit A,” the Listing Agreement provided that:

WHEREAS, Owner owns the Property described as Exhibit “A” attached hereto and made a party herein by reference, the improvements and fixtures thereon, and all appurtenances thereto (said land, improvements, fixtures and appurtenances and any personal property of Owner on said land or in such improvements being herein called the “Property”). This Property is located at the intersection of business highway 83 and Jackson Road in McAllen, Texas and Pharr, Texas.

“Exhibit A” is a drawing labeled “Site Master Plan,” which clearly references all the property

in question. The Listing Agreement further provides that SPP, in particular, was responsible

for paying SJW a 6% sales commission, a 4% commission for “total lease rental for the

primary term (years 1-10)” and a 2% commission “of the total rental for the primary term

(years 11-20) of each lease if Broker is the sole source of tenant.”

In the instant case, Palmer did not complain about “Exhibit A” until trial. Based on

the testimony at trial, it is clear to us that the parties understood to which property the

Listing Agreement applied. In addition, the version of the Listing Agreement admitted into

evidence as “Plaintiff’s Exhibit 1" included “Exhibit A” and described the property in question

with reasonable certainty. See Tex. Builders v. Keller, 928 S.W.2d 479, 481 (Tex. 1996)

(citing Morrow v. Shotwell, 477 S.W.2d 538, 539 (Tex. 1972) (“A writing need not contain

a metes and bounds property description to be enforceable; however, it must furnish the

data to identify the property with reasonable certainty.”)); see also Duncan v. F-Star Mgmt.,

L.L.C., 281 S.W.3d 474, 478-79 (Tex. App.–El Paso 2008, pet. filed).

The thrust of the Palmer companies’ argument as to this issue appears to be that

“Exhibit A” was not tendered to Palmer at the time of signing and, therefore, the Listing 71 Agreement was unenforceable because it lacked an adequate property description. The

Palmer companies cite to Palmer’s testimony at trial that he first saw “Exhibit A” attached

to the Listing Agreement when reviewing a lien filed by SJW in 2000. Despite the above-

mentioned statements, we note that it was within the province of the jury to reconcile

Palmer’s allegations that the “Exhibit A” was not presented to him at the time he signed the

agreement on behalf of SPP with the version of the Listing Agreement admitted into

evidence which clearly references “Exhibit A,” includes a copy of “Exhibit A,” and provides

a description of the property at issue. See City of Keller, 168 S.W.3d at 819. In concluding

that the Palmer companies were responsible for paying commissions on the Staples and

Fashion Bug leases and that the Palmer companies were not excused from compliance with

the Listing Agreement, the jury clearly believed that the Listing Agreement was enforceable

and that “Exhibit A” was tendered at the time of signing.31 Because the Palmer companies

have not directed us to any evidence in the record, other than Palmer’s own self-serving

testimony, demonstrating that the jury was unreasonable in its conclusions pertaining to the

31 Question num ber 10 of the jury charge provided the following with respect to the Palm er com panies’ failure to pay SJW com m issions at the Jackson Palm er Crossing:

W as G.J. Palm er, Jr.’s failure to com ply [with the Listing Agreem ent’s requirem ent to pay com m issions to SJW for bringing tenants to the Jackson Palm er Crossing shopping center] excused?

Com pliance is excused if:

a. The agreem ent between G.J. Palm er, Jr. and SJW Property Com m erce, Inc. is not in writing; or

b. The agreem ent between G.J. Palm er, Jr. and SJW Property Com m erce, Inc. is not signed by G.J. Palm er, Jr.; or

c. The agreement between G.J. Palmer, Jr. and SJW Property Commerce, Inc. does not describe the property subject to the agreement with reasonable certainty; or

d. SJW Property Com m erce, Inc. breached its fiduciary duty to G.J. Palm er, Jr.

Answer: No

(Em phasis added.) 72 leases at Jackson Palmer Crossing and we find none, we must defer to the jury’s implicit

conclusion that the “Exhibit A” was presented to Palmer at the time of signing the Listing

Agreement and that the agreement was enforceable. See id.

Moreover, in reviewing section 1101.806(c), we find that the statute merely requires

that an agreement to sell or purchase real estate be in writing and signed by the party

against whom an action is brought, which does not appear to support the Palmer

companies’ argument that the Listing Agreement is unenforceable. See TEX . OCC . CODE

ANN . § 1101.806(c). We therefore reject the Palmer companies’ argument that the Listing

Agreement was unenforceable because it lacked an adequate property description.32

With respect to the Palmer companies’ legal and factual sufficiency arguments, we

find that the evidence contained in the record supports the jury’s verdict. In fact, the record

reflects that both SJW and SPP signed the Listing Agreement. Furthermore, Palmer

admitted at trial that he owed commissions to SJW for work done at the Jackson Palmer

Crossing shopping center, but he chose to withhold the payment of commissions because

of what had transpired between himself and SJW at the Trenton Project. See Mendoza v.

Fid. & Guar. Ins., 606 S.W.2d 692, 694 (Tex. 1980) (holding that testimony is a judicial

admission); AEP Tex. Cent. Co. v. Pub. Util. Comm’n of Tex., 286 S.W.3d 450, 469, n.24

(noting that a “judicial admission is binding on the party admitting it, and he may not

introduce contradicting evidence”) (citing Cameron County v. Velasquez, 668 S.W.2d 776,

782 (Tex. App.–Corpus Christi 1984, writ ref’d n.r.e.)); see also Tex. Dep’t of Pub. Safety

v. Morales, No. 13-07-00552-CV, 2008 Tex. App. LEXIS 3898, at *6 (Tex. App.–Corpus

Christi May 22, 2008, no pet.) (mem. op.). The record also contains a letter sent by Palmer

to SJW recognizing that SJW was owed commissions for work done at the Jackson Palmer 32 W e find it ironic that the Palm er com panies request that we find the Listing Agreem ent to be unenforceable as to the paym ent of com m issions to SJW , yet the Palm er com panies use article 6.04 of the sam e “unenforceable” Listing Agreem ent to argue entitlem ent to attorney’s fees. 73 Crossing shopping center and requesting additional time to make such payments. The

Listing Agreement provides that it was effective from June 30, 1999 to June 30, 2000, and

the record reflects that SJW facilitated the signing of leases by Staples and Fashion Bug

at the Jackson Palmer Crossing shopping center during the term of the Listing Agreement.33

In reviewing the evidence in the light most favorable to the jury’s findings, we

conclude that the jury was reasonable in concluding that the Palmer companies were

responsible for paying commissions to SJW on the Staples and Fashion Bug leases. See

City of Keller, 168 S.W.3d at 807, 810-11. Furthermore, in reviewing the evidence in a

neutral light, we cannot conclude that the jury’s findings as to this issue were so contrary

to the overwhelming weight of the evidence as to be clearly wrong or unjust. See Cain, 709

S.W.2d at 176. Accordingly, we find that the evidence is legally and factually sufficient, and

we overrule the Palmer companies’ sole cross-issue. See City of Keller, 168 S.W.3d at

807, 810-11; see also Cain, 709 S.W.2d at 176.

VIII. CONCLUSION

Based on the foregoing, we reverse the jury’s award of $376,397 in punitive

damages against PCDC and render judgment that the Palmer companies take nothing as

to PCDC. However, because the trial court concluded that SJW and PCDC were jointly and

severally liable for the jury’s award of $376,397 in actual damages, we affirm the jury’s

damages awards against SJW. Moreover, we affirm the remaining aspects of the trial

court’s judgment.

______________________ ROGELIO VALDEZ Chief Justice Delivered and filed the 23rd day of September, 2010.

33 On appeal, SJW does not claim entitlem ent to com m issions that m ay be associated with the Factory 2-U lease at the Jackson Palm er Crossing shopping center. 74