Gregg Hall, as of the Estate of Preston L. Hall v. Hubco, Inc. ( 2006 )

Motion for Rehearing Granted in Part and Overruled in Part; Supplemental Opinion on Motion for Rehearing filed June 8, 2006

  

Motion for Rehearing Granted in Part and Overruled in Part; Supplemental Opinion on Motion for Rehearing filed June 8, 2006.

In The

Fourteenth Court of Appeals

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NO. 14-05-00073-CV

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GREG HALL, AS EXECUTOR OF THE ESTATE OF PRESTON L. HALL, Appellant

V.

HUBCO, INC., Appellee

On Appeal from the 215th District Court

Harris County, Texas

Trial Court Cause No. 02-55739

S U P P L E M E N T A L   O P I N I O N   O N

M O T I O N   F O R R E H E A R I N G

In our initial opinion, we held that the trial court erred in disregarding the jury=s answer to question 7 regarding market-value damages because the jury=s response to the question was material and the record does not reflect that Hubco ever made a motion to disregard this question.  Hubco moved for rehearing, arguing in part that it was not required to make such a motion and that in any case, it did so move. We grant Hubco=s motion for rehearing on this issue only and now issue this opinion as a supplement to our original opinion of February 9, 2006.^[1]  We overrule the remaining issues in Hubco=s motion for rehearing.

Hubco contends that we erred in holding that it was required to move to disregard the jury=s answer to question 7.  Hubco argues that it suffered no adverse ruling unless and until the trial court entered judgment based on the jury=s response to question 7, and because the trial court did not enter judgment on the finding, it had no legal requirement to object.  We disagree.  As stated in our initial opinion, when, as here, a jury question is material, the trial court may disregard the jury=s response only pursuant to a motion to do so.  See Tex. R. Civ. P. 301; Fire Ins. Exch. v. Sullivan, No. 14-04-00081-CV, __ S.W.3d __, 2006 WL 278254, at *4 (Tex. App.CHouston [14th Dist.] Feb. 7, 2006, no pet. h.); Anderson, Greenwood & Co. v. Martin, 44 S.W.3d 200, 216B17 (Tex. App.CHouston [14th Dist.] 2001, pet. denied).  Such a motion is a jurisdictional prerequisite to the trial court=s power to disregard a jury finding.  Olin Corp. v. Cargo Carriers, Inc., 673 S.W.2d 211, 214 (Tex. App.CHouston [14th Dist.] 1984, no writ).  Otherwise, the trial court must render a judgment that conforms to all material findings.  See Tex. R. Civ. P. 300, 301; Fire Ins. Exch., 2006 WL 278254, at *4; Brown v. Armstrong, 713 S.W.2d 725, 728B29 (Tex. App.CHouston [14th Dist.] 1986, writ ref=d n.r.e.). Thus, if Hubco did not file a motion to disregard the jury=s response to question 7, then the trial court had no authority to disregard it.

Before issuing our initial opinion, we ordered the parties to supplement the clerk=s record to include all post-judgment briefing regarding entry of judgment or modification of the jury=s verdict but did not receive all such briefing.  Thus, we were unable to determine that Hubco had ever requested that the trial court disregard the jury=s finding on question 7.  After we issued our opinion, the record was supplemented again with five additional relevant post-judgment documents.  Based on the context provided by this new supplementation, we now conclude that Hubco made a minimally adequate request to disregard the jury=s finding on question 7.

Hubco originally moved to disregard only the findings on questions 1 (regarding breach of the June agreement) and 5a (cost to clean up the property).  The parties extensively briefed these issues. Eventually, Hall argued that even if its evidence proving clean-up costs was insufficient, it could still recover for the decrease in market value that the jury found in question 7.  In response, Hubco filed a memorandum of authorities entitled AAdditional Authorities in Support of Defendant=s Motion to Disregard Jury Findings@ that asserted the Adiminution in value is not the measure of damages for the breach of contract claims asserted in the case at bar.@ Hubco neither explained why it believed market-value damages were inappropriate nor specifically requested that the trial court disregard the response to question 7.  Hall then filed a brief explaining why he believed market-value damages were appropriate in this case.

In determining the nature of a filing, we look to the substance of document, not merely its title.  Rush v. Barrios, 56 S.W.3d 88, 93 (Tex. App.CHouston [14th Dist.] 2001, pet. denied).  A>Its substance is determined by what effect it will have on the proceeding if granted.=@  Id. (quoting Univ. of Houston v. Elthon, 9 S.W.3d 351, 355 (Tex. App.CHouston [14th Dist.] 1999, pet. dism=d w.o.j.)).  Though Hubco did not explicitly request that the trial court disregard the response to question 7, its memorandum of authorities was intended to persuade the trial court that the market damages the jury found in question 7 were inapplicable. Thus, we now hold that Hubco=s memorandum of authorities constituted an implicit request for the trial court to disregard the jury=s response to question 7, which gave the trial court the authority to disregard it.  See id. at 93B94 (holding that ABrief in Support of Fee Forfeiture@ constituted a request for judgment notwithstanding the verdict based on the brief=s substance).

We must now determine whether the trial court erred in disregarding the response to question 7.  As we stated in our initial opinion, A[i]f repair is feasible and does not cause economic waste, then the plaintiff may recover the cost of repair; otherwise, the plaintiff is entitled to the decrease in market value caused by the injury.@  See Coastal Transp. Co. v. Crown Cent. Petroleum Corp., 136 S.W.3d 227, 235 (Tex. 2004); Samuel v. KTVU P=ship, No. 08-02-00010-CV, 2003 WL 22405384, at *1 (Tex. App.CEl Paso Oct. 22, 2003, pet. denied) (mem. op.); Jim Walter Homes, Inc. v. Gonzalez, 686 S.W.2d 715, 717 (Tex. App.CSan Antonio 1985, writ dism=d). Hubco argues that our initial ruling reinstating market-value damages gives Hall an economically wasteful windfall because A[i]t is undisputed that the repair (clean up) costs here were less than market value.@  We reject this argument.  Because we have determined that the only evidence of clean-up costs presented was unreliable, there is no evidence of clean-up costs.  See Kerr-McGee Corp. v Helton, 133 S.W.3d 245, 254 (Tex. 2004) (AIf the expert=s testimony is not reliable, it is not evidence.@).  That the jury found clean-up costs were less than the decrease in market value based on unreliable evidence does not mean the result would have been the same with reliable evidence.  It is impossible to know whether, had adequate soil samples been taken, greater levels of waste would have been found, resulting in higher clean-up costs. Hubco cannot have it both waysCwe cannot disregard the expert evidence for purposes of proving damages based on clean-up cost but then use that evidence to show clean-up costs were less than the decrease in market value.

Hall is entitled to recover either clean-up costs or the decrease in market value, whichever is less.  See Coastal Transp. Co., 136 S.W.3d at 235; Samuel, 2003 WL 22405384, at *1; Jim Walter Homes, 686 S.W.2d at 717; see also Greene v. Bearden Enters., Inc., 598 S.W.2d 649, 652 (Tex. Civ. App.CFort Worth 1980, writ ref=d n.r.e.) (noting the Ageneral rule@ that the plaintiff is Aentitled to the remedial cost or difference in value, whichever is less@).  Though Hall may have attempted to prove both measures of damages, he was not required to do so.  We have found no Texas case holding that market-value damages are not available on the basis that the plaintiff had no evidence of clean-up or other repair costs for comparison.  The minimization of damages is a defensive matter on which the defendant bears the burden of proof.  See Rauscher Pierce Refsnes, Inc. v. Great Sw. Sav., F.A., 923 S.W.2d 112, 117 (Tex. App.CHouston [14th Dist.] 1996, no writ); P.G. Lake, Inc. v. Sheffield, 438 S.W.2d 952, 956 (Tex. Civ. App.CTyler 1969, writ ref=d n.r.e.); see also Chem. Express Carriers, Inc. v. French, 759 S.W.2d 683, 688B89 (Tex. App.CCorpus Christi 1988, writ denied) (holding that defendant has the burden to prove that repair increased the value of the property above original value, thus reducing repair cost damages by amount of increase in value (citing Pasadena State Bank v. Isaac, 228 S.W.2d 127, 129 (Tex. 1950))). If the plaintiff proves one legitimate measure of damages and the defendant believes an alternative measure would reduce the damages award, it is the defendant=s burden to prove the lesser amount.^[2]  See Miller v. Dickenson, 677 S.W.2d 253, 258B259  (Tex. App.CFort Worth 1984, writ ref=d n.r.e.); Heritage Hous. Corp. v. Ferguson, 674 S.W.2d 363, 366B67 (Tex. App.CDallas 1984, writ ref=d n.r.e.); Jim Walter Homes, Inc. v. Castillo, 616 S.W.2d 630, 635 (Tex. Civ. App.CCorpus Christi 1981, no writ); Greene, 598 S.W.2d at 652B53; P.G. Lake, 438 S.W.2d at 955B56. Hubco failed in this burden.^[3]  Because the decrease in market value is a valid damages measure and there is no evidence that cleaning up the property is feasible and less expensive, Hall is entitled to recover market-value damages.  Thus, as in our original opinion, we conclude the trial court erred in disregarding the jury=s response to question 7.

/s/      Leslie Brock Yates

Justice

Motion for Rehearing Granted in Part and Overruled in Part and Supplemental Opinion on Motion for Rehearing filed June 8, 2006.

Panel consists of Chief Justice Hedges and Justices Yates and Anderson.

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^[1]  In its response to Hubco=s motion for rehearing, Hall requests that we reconsider our conclusion that Hall=s expert evidence of clean-up costs was unreliable and therefore insufficient.  Because we are unpersuaded that we erred in this respect, we overrule Hall=s request.

^[2]  Courts in Tennessee, Arizona, and Wisconsin apply this rule as well.  See Conatser v. Ball, No. M1999-00583-COA-R3-CV, 2001 WL 873457, at *12 (Tenn. Ct. App. 2001) (citing A.I.D. Ins. Servs. v. Riley, 541 P.2d 595, 598B99 (Ariz. Ct. App. 1975), Greene, 598 S.W.2d at 653 (citing Engel), and Engel v. Dunn County, 77 N.W.2d 408, 410 (Wis. Ct. App. 1956)).

^[3]  Although Hubco=s expert criticized Hall=s expert=s damages estimate, he did not offer his own estimate.