Patricia Hayes Donalson, Independent of the Estate of George E. Hayes v. Jerry Harrington, Individually and as Independent of the Estate of Betty Jo Hayes ( 2021 )

In The
Court of Appeals
Ninth District of Texas at Beaumont
________________
NO. 09-19-00286-CV
________________
PATRICIA HAYES DONALSON, INDEPENDENT EXECUTRIX OF THE
ESTATE OF GEORGE E. HAYES, Appellant
V.
JERRY HARRINGTON, INDIVIDUALLY AND AS INDEPENDENT
EXECUTOR OF THE ESTATE OF BETTY JO HAYES, Appellee
________________________________________________________________________
On Appeal from the County Court at Law No. 1
Jefferson County, Texas
Trial Cause No. 117707
________________________________________________________________________
MEMORANDUM OPINION
Patricia Hayes Donalson appeals the trial court’s final judgment based on a
jury verdict in favor of Jerry Harrington. 1 In three issues, Donalson argues: (1)
Harrington is not entitled to attorney’s fees both as a matter of law and based on a
1
Jerry Harrington passed away during the pendency of this appeal. The appeal
was abated, and the trial court appointed Thomas Amidee Morgan as the successor
executor of Betty Jo Hayes’s estate.
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lack of evidence at trial; (2) there is legally and factually insufficient evidence to
support the jury’s findings of zero damages for Harrington’s breach of fiduciary
duty; and (3) there is legally and factually insufficient evidence to support the jury’s
finding of estoppel and ratification as affirmative defenses to Harrington’s breach of
fiduciary duty. Harrington also raises one cross-point on appeal, challenging the
jury’s breach of fiduciary duty findings. For the following reasons, we affirm the
trial court’s judgment.
Background
The underlying litigation involves a suit for declaratory judgment and will
contest. In 1998, Betty Jo drafted a will leaving everything to her husband, George.
In the event that George predeceased her, half of Betty’s property would go to her
only living son, Harrington, and the other half would go to George’s sister,
Donalson. On November 15, 2016, Betty Jo executed another will, leaving her entire
estate to Harrington. At the time Betty Jo executed this will, the record showed she
suffered from many health problems, including the early stages of Alzheimer’s.
According to Harrington, Betty Jo wanted to execute a new will, so he found
her a lawyer. Harrington testified that he drove Betty Jo to the lawyer’s office, and
he characterized her mental state as “good” when he took her to execute the will.
Harrington did not tell George that Betty Jo executed a new will. The attorney who
prepared the will also testified at trial. The attorney stated that she visited with Betty
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Jo before drafting the will and believed Betty Jo understood what she was signing
and where her property was going. The attorney also testified that based on her
observation, Harrington was not trying to get his mother to sign a will in his favor
and in fact, cautioned her to make certain she wanted to do it before she signed. The
attorney also explained that Betty Jo directed all her property to go to Harrington
instead of George, and Betty Jo “was very clear in her intent[.]”
Betty Jo died on May 4, 2017. Thereafter, Harrington applied to probate the
new will and obtain the issuance of letters testamentary. Harrington also filed a
declaratory judgment action against George, seeking to have the Hayses’ bank
accounts, IRA accounts, and home declared community property, with one-half
belonging to Betty Jo. Harrington also sought injunctive relief to prevent George
from spending or transferring the property. Harrington sought attorney’s fees
pursuant to Texas Civil Practice and Remedies Code section 37.009 and Texas
Probate Code section 352.052.
George died before trial; his sister and sole heir, Donalson, was named
executrix of his estate. Donalson had also been named as the successor executrix
under Betty Jo’s 1998 will and a contingent beneficiary if George predeceased Betty
Jo. Donalson counterclaimed for declaratory judgment that Harrington committed
fraud and depleted the community estate and sought damages for breach of fiduciary
duty. She also filed a separate opposition seeking to invalidate the November 2016
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will and to instead have the 1998 will admitted to probate. Prior to trial, Harrington
filed a no evidence motion for summary judgment on his declaratory judgment
action to have the specified property declared community property, which the trial
court granted.
When Betty Jo died, Harrington was her only living child and George’s
stepson. George and Betty Jo had been married since the late 1970s. George retired
from Gulf States, while Betty Jo retired from Texaco. They also received Social
Security benefits. Both George and Betty Jo suffered from numerous health
problems. Neither of them could drive, and they required assistance from home
health nurses that came into the home multiple times a week. Harrington saw Betty
Jo every day and despite Betty Jo’s health problems, he did not believe there was
anything wrong with her mentally, but he occasionally reported to doctors she was
confused.
Despite not working for more than eight years, Harrington testified he
obtained employment on a construction job but did not take it so he could take care
of George and Betty Jo, which was what George wanted. Harrington testified that
he took them to see doctors, picked up medications for them, mowed their grass, and
bought groceries for them. He testified that his monthly bills were $1900, and that
was what George paid him per month. The evidence also established that George
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would sign blank checks and give them to Harrington to fill out. There was also
testimony at trial that George paid for some home repairs to Harrington’s house.
The trial court submitted thirteen issues to the jury. The jury found that Betty
Jo had testamentary capacity to execute the November 2016 will and Harrington had
not unduly influenced her to execute the will. The jury found that a relationship of
trust and confidence existed between George and Betty Jo and Harrington and that
Harrington failed to comply with that relationship. The jury found that when George
signed the blank checks, he did not have full knowledge of all material facts related
to the breach of fiduciary duty. However, the jury also found that George ratified
Harrington’s conduct after he did obtain full knowledge of the facts and that his
estate was estopped from seeking any damages. The jury found that Harrington acted
in good faith in defending the November 2016 will but found that Donalson did not
act in good faith and with just cause in prosecuting the suit to have the 1998 will
admitted to probate. The jury awarded Donalson zero damages for Harrington’s
breach of fiduciary duty. The jury also awarded Harrington $32,244 in necessary
expenditures, including reasonable attorney’s fees, which the trial court reduced to
$21,150 in the final judgment.
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General Rules of Error Preservation
In response to each of Donalson’s issues, Harrington argues that she failed to
preserve these complaints for our review. 2 As a prerequisite to presenting a
complaint on appeal, an appellant must show she preserved it by making the
complaint “to the trial court by a timely request, objection, or motion” stating the
grounds for the desired ruling with “sufficient specificity to make the trial court
aware of the complaint, unless the specific grounds were apparent from the
context[.]” Tex. R. App. P. 33.1(a)(1)(A). To preserve factual sufficiency
complaints, a complaint that a jury finding is against the great weight of the
evidence, or a complaint about the inadequacy or excessiveness of damages, the
complaining party must raise them in a motion for new trial. See Tex. R. Civ. P.
324(b)(2), (3), (4). To preserve a legal sufficiency complaint, a party must: (1)
present a motion for instructed verdict or judgment notwithstanding the verdict; (2)
object to the submission of a jury question; (3) present a motion to disregard the
jury’s answer to a vital fact issue; or (4) file a motion for new trial. Cecil v. Smith,
804 S.W.2d 509, 510–11 (Tex. 1991).
2
Donalson does not cite where in the record she preserved these complaints,
therefore, we have independently reviewed the record to determine if she preserved
them.
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Attorney’s Fees
Donalson complains the trial court erred by awarding attorney’s fees as a
matter of law and due to a “[l]ack of [e]vidence.” The record establishes that in
response to Harrington’s motion for entry of judgment, Donalson objected to the
attorney’s fees award, arguing they were not available under the estates code as a
matter of law, and there was a lack of evidence to support an attorney’s fee award
under the Declaratory Judgment Act.
Even if we assume Donalson’s objection to Harrington’s motion for entry of
judgment preserved the complaint about the availability of the attorney’s fee award,3
Harrington was still entitled to attorney’s fees pursuant to Texas Civil Practice and
Remedies Code section 37.009. Both parties’ pleadings included causes of action for
declaratory relief. Harrington’s claim for declaratory relief addressed the
characterization of community property, whereas Donalson’s counterclaim for
declaratory relief pertained to reimbursing the estate for money she alleged
Harrington improperly obtained. The trial court resolved the community property
issue prior to trial when it granted Harrington’s partial no evidence motion for
3
While we do not determine that this is the case, at least one appellate court
has explained in determining that error had been preserved in part by “objections to
[a party’s] motion for entry of judgment and their own motion for entry of judgment,
which we have construed as motions for JNOV or to disregard the verdict.” See
Hong Kong Dev., Inc. v. Nguyen, 229 S.W.3d 415, 452 (Tex. App.—Houston [1st
Dist.] 2007, no pet.) (citing Cecil v. Smith, 804 S.W.2d 509, 510–11 (Tex. 1991)).
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summary judgment characterizing all property as community and declaring half of
the property as Betty Jo’s. However, Donalson’s counterclaim for declaratory relief
pertaining to reimbursement of the funds to the estate as well as her separate
challenge to the validity of Betty Jo’s will remained through trial. Harrington also
pleaded for attorney’s fees.
Any interested person in the administration of the estate of a decedent may
bring a claim for declaratory relief to determine any question arising in the
administration of the trust or estate. See Tex. Civ. Prac. & Rem. Code Ann. § 37.005.
As a person interested in the estates of Betty Jo and George, Donalson had a right to
bring her counterclaim for declaratory relief regarding the validity of Betty Jo’s will
and whether the estates were entitled to reimbursement. See id. In any declaratory
proceeding brought under chapter 37, the trial court may award costs and reasonable
and necessary attorney’s fees as are equitable and just. 4 See id. § 37.009. Harrington
had to defend Donalson’s counterclaim for reimbursement to the estates along with
the will contest through trial. This necessarily implicated the interests of both parties,
as Donalson was also a beneficiary under Betty Jo’s prior will, which would have
4
On appeal, Donalson complains for the first time that the trial court failed to
find the attorney’s fees were “equitable and just.” Donalson did not complain in the
trial court that the fees were unreasonable, unnecessary, inequitable or unjust.
Having failed to raise this in the trial court, Donalson has not preserved this
complaint for our review. See Tex. R. App. P. 33.1(a)(1)(A).
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governed the disposition of her estate if the jury determined Betty Jo lacked
testamentary capacity when she executed the November 2016 will.
“The availability of attorney’s fees under a particular statute is a question of
law for the court.” Holland v. Wal-Mart Stores, Inc., 1 S.W.3d 91, 94 (Tex. 1999)
(citation omitted). Therefore, a jury’s finding concerning the amount of reasonable
attorney’s fees is immaterial to the ultimate legal issue of whether such fees are
recoverable. See id. A jury can determine the amount of attorney’s fees whether or
not they can be recovered under the theory of law submitted to the jury. See id. The
jury was asked what sum of money it found to be necessary expenses and
disbursements, including reasonable attorney’s fees, to defend the document dated
November 15, 2016, previously admitted to probate. This finding could support an
award under the DJA or the Probate Code, as it addressed defending the will, which
also went to determining the rights of parties interested in the estates; however, the
trial court determined as a matter of law that attorney’s fees were available and
awarded them pursuant to Texas Civil Practice and Remedies Code Chapter 37, and
we agree. We need not address the availability of attorney’s fees under section
352.052 of the Probate Code.
As an appellant attacking the legal sufficiency of an adverse finding on which
she did not have the burden of proof at trial, Donalson must demonstrate there is no
evidence to support the adverse finding. See Exxon Corp. v. Emerald Oil & Gas Co.,
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L.C., 348 S.W.3d 194, 215 (Tex. 2011). Harrington’s attorney testified at trial
regarding his experience, his hourly rate, the total fees incurred of $32,244 for work
performed defending the will and explained some of those tasks were “inextricably
intertwined” with other causes of action. Counsel testified that the fees were
reasonable and necessary. The trial court also admitted the attorney’s bill without
objection. Having failed to demonstrate that there was no evidence to support the
attorney’s fee award, Donalson has failed to meet her burden of proof on this issue.
See id. We overrule this issue. 5
Legal and Factual Sufficiency: Zero Damages
Next, Donalson contends the evidence was legally and factually insufficient
to support the jury’s award of zero damages for Harrington’s breach of fiduciary
duty. To preserve factual sufficiency complaints, a complaint that a jury finding is
against the great weight of the evidence, or a complaint about the inadequacy or
excessiveness of damages, the complaining party must raise them in a motion for
new trial. See Tex. R. Civ. P. 324(b)(2), (3), (4). Donalson failed to file a motion for
new trial, therefore she did not preserve her factual sufficiency complaint for our
5
Donalson also complained about the trial court “re-open[ing]” evidence in
violation of Texas Rule of Civil Procedure 270, to hear testimony regarding
attorney’s fees in the event of an appeal. Since the trial court did not award appellate
attorney’s fees, the error, if any, in re-opening the evidence was harmless. See Tex.
R. App. P. 44.1(a) (judgment may not be reversed for error unless the error probably
caused the rendition of an improper judgment).
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review. See id.; see also Tex. R. App. P. 33.1(a)(1)(A). To preserve a legal
sufficiency complaint, a party must: (1) present a motion for instructed verdict or
judgment notwithstanding the verdict; (2) object to the submission of the jury
question; (3) present a motion to disregard the jury’s answer to a vital fact issue; or
(4) file a motion for new trial. Cecil, 804 S.W.2d at 510–11. Donalson did not present
her complaint to the trial court regarding the jury’s zero damages award as outlined
above. Her complaint that the evidence is legally insufficient to support the jury’s
award of zero damages is not preserved for review. See id.; see also Tex. R. App. P.
33.1(a)(1)(A). We overrule issue two.
Legal and Factual Sufficiency: Ratification and Estoppel
Finally, Donalson argues the evidence was legally and factually insufficient
to support the jury’s finding that George ratified Harrington’s conduct and that
Donalson was estopped from seeking damages based on Harrington’s reliance on
George’s representations to his detriment. Because Donalson did not file a motion
for new trial, her complaint regarding the factual insufficiency of the evidence to
support the jury’s findings of ratification and estoppel has not been preserved for our
review. See Tex. R. App. P. 33.1(a)(1)(A); Tex. R. Civ. P. 324(b)(2), (3), (4).
Donalson did object to the submission of the jury questions regarding ratification
and estoppel on the basis that the evidence did not support their submission, thus
preserving her legal sufficiency complaint. See Cecil, 804 S.W.2d at 510–11 (noting
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one way to preserve a legal sufficiency complaint is objecting to the submission of
a jury question). 6
Donalson acknowledges that she did not have the burden of proof with respect
to the affirmative defenses of estoppel and ratification. Therefore, Donalson must
demonstrate there is no evidence to support the adverse finding. See Exxon Corp.,
348 S.W.3d at 215. In this case, however, the record establishes evidence supported
both findings. Harrington testified that in exchange for being available to run errands
for George and Betty Jo and drive them to doctors’ appointments, George agreed to
pay Harrington’s bills in a certain amount each month. Harrington also testified that
he purchased groceries for them, picked up medications for them, and brought meals
from restaurants for them. There was also testimony that George paid for repairs to
his home. The evidence established that up until shortly before his death, George
handled his own financial affairs, including writing checks, keeping up with his bank
records, and dealing with his accountant. Harrington testified that George sometimes
signed checks but left the amounts blank and allowed Harrington to fill them out.
The evidence further revealed that this went on for many years and continued even
6
To the extent that she argues that the lack of a definition of “estoppel” in the
jury charge was confusing, that objection was not made in the trial court nor did she
submit a “substantially correct definition” in writing, so we do not address it. See
Tex. R. Civ. P. 278 (“Failure to submit a definition or instruction shall not be deemed
a ground for reversal of the judgment unless a substantially correct definition or
instruction has been requested in writing and tendered by the party complaining of
the judgment.”).
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after Betty Jo died. From this evidence, the jury could have concluded that even if
George did not have all material knowledge of the breach of fiduciary duty when he
initially wrote the checks, George thereafter ratified Harrington’s expenditures and
that Harrington relied on George’s acceptance of these expenditures by his actions
in the years after Betty Jo died. Donalson has failed to meet her burden to show that
there was no evidence to support the jury’s findings, and we conclude the evidence
is legally sufficient.
Donalson also contends that the jury’s findings with respect to ratification and
estoppel were contradictory. Specifically, he contends that the jury found George
did not have knowledge of all material facts. But, for the jury to find that he ratified
Harrington’s conduct, it would necessarily require full knowledge of the facts. “[T]o
preserve error based on fatally conflicting jury answers, parties must raise that
objection before the trial court discharges the jury.” USAA Tex. Lloyds Co. v.
Menchaca, 545 S.W.3d 479, 518 (Tex. 2018); see also Tex. R. Civ. P. 295 (noting
that for conflicting answers, the trial court shall instruct the jury in writing in open
court of the nature of the conflict, provide the jury with appropriate instructions, and
retire the jury for further deliberations). Donalson made no objection to any conflict
between the jury’s answers prior to the jury being discharged, and consequently,
failed to preserve error with respect to any conflict. See Menchaca, 545 S.W.3d at
13
518; Sears, Roebuck & Co. v. Kunze, 996 S.W.2d 416, 423 (Tex. App.—Beaumont
1999, pet. denied).
We determine Donalson failed to preserve her factual sufficiency complaint
and complaint regarding conflicting jury answers. Having further determined the
evidence was legally sufficient to support the jury’s findings as to ratification and
estoppel, we overrule issue three.
Appellee’s Cross-Point
Harrington raises one cross-point on appeal, in essence presenting another
reason for affirming the trial court’s judgment. See City of Austin v. Whittington, 384
S.W.3d 766, 789 (Tex. 2012) (addressing appellate cross-point where no notice of
appeal was filed because the party did not seek greater relief than the judgment
awarded). Harrington complains that the evidence was legally and factually
insufficient to prove a relationship of trust or confidence or breach of fiduciary duty
by Harrington and asserts that he preserved these complaints by objecting to
Questions No. 2 and No. 4 in the Court’s Charge regarding breach of fiduciary duty.
While it is true that an objection to the submission of a question can preserve a legal
sufficiency challenge, a party must file a motion for new trial to preserve a factual
sufficiency complaint. See Tex. R. Civ. P. 324(b)(2). Harrington did not file a motion
for new trial, so any factual sufficiency complaint is waived. See id.14
Harrington’s legal insufficiency complaint was preserved by an objection to
Question No. 2 that “there’s no evidence or insufficient evidence to submit the
question to the jury of a relationship of trust and confidence” between the decedents
and Harrington. He also objected to Question No. 4 on the basis that “there’s no
evidence that he had a[n] informal or formal fiduciary relationship with George
Hayes.” He primarily challenges the existence of the fiduciary relationship.
“Generally, the elements of a claim for breach of fiduciary duty are (1) the existence
of a fiduciary duty, (2) breach of the duty, (3) causation, and (4) damages.” First
United Pentecostal Church of Beaumont v. Parker, 514 S.W.3d 214, 220 (Tex. 2017)
(citations omitted). A fiduciary relationship can be formal or informal. See Meyer v.
Cathey, 167 S.W.3d 327, 330–31 (Tex. 2005). Formal fiduciary relationships arise
as a matter of law, such as with attorney-clients, partnerships, and trustee
relationships. See id. at 330. Informal fiduciary relationships can arise from moral,
social, domestic, or purely personal relationships of trust and confidence. See id. at
331.
Harrington did not have the burden of proof regarding the existence of a
fiduciary relationship and Harrington’s breach of that duty. Therefore, in challenging
the legal sufficiency of these findings on which he did not have the burden of proof,
Harrington must demonstrate no evidence supports them. See Exxon Corp., 348
S.W.3d at 215. The record contained evidence that Harrington took care of many of
15
George and Betty Jo’s daily needs, from getting food and medications to taking them
for medical care. The record further reveals that George and Betty Jo were unable to
drive and suffered from a multitude of physical ailments that made them dependent
upon Harrington. The record also showed there was a familial relationship between
George and Betty Jo and Harrington. Legally sufficient evidence “would enable
reasonable and fair-minded people to reach the verdict under review.” City of Keller
v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). In our review, we “credit favorable
evidence if reasonable jurors could, and disregard contrary evidence unless
reasonable jurors could not.” Id. Using these guiding principles, we cannot say that
Harrington has demonstrated no evidence supports these findings. Accordingly, the
evidence was legally sufficient to support the jury’s affirmative finding that a
relationship of confidence and trust existed, and that Harrington failed to comply
with the fiduciary duty. See Exxon Corp., 348 S.W.3d at 215.
Another argument Harrington raises with respect to Question No. 4 is that the
question “does not define fiduciary duty, so damages cannot be presumed by this
jury finding[.]”Nowhere in his objection did he apprise the trial court that a specific
definition of “fiduciary duty” should have been included nor did he submit a written
definition to the trial court. See Tex. R. Civ. P. 278 (noting requirement for
“substantially correct definition” in writing); Security Nat. Ins. Co. v. Murrell, No.
02-11-00155-CV, 2012 WL 3115733, at *4 (Tex. App.—Fort Worth Aug. 2, 2012,
16
pet. denied) (mem. op.) (concluding that where party did not present proposed
correct definition in writing it waived error, if any).
We overrule Harrington’s cross-point.
Conclusion
We conclude legally sufficient evidence supported the attorney’s fees award,
which are recoverable under the DJA, and legally sufficient evidence supported the
jury’s answers to the affirmative defense questions regarding ratification and
estoppel. All other issues having been waived for lack of preservation, we affirm the
trial court’s judgment.
AFFIRMED.
________________________________
CHARLES KREGER
Justice
Submitted on February 19, 2021
Opinion Delivered July 29, 2021
Before Kreger, Horton and Johnson, JJ.
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