In re BCH Dev., LLC

• Decision Date: 15 August 2017
• Docket Number: No. 05-16-01481-CV.,05-16-01481-CV.
• Citation: 525 S.W.3d 920
• Parties: IN RE BCH DEVELOPMENT, LLC, Relator
• Court: Texas Court of Appeals

525 S.W.3d 920

IN RE BCH DEVELOPMENT, LLC, Relator

No. 05-16-01481-CV.

Court of Appeals of Texas, Dallas.

Opinion Filed August 15, 2017

Thomas A. Culpepper, Michael A. Yanof, Cassie Dallas, Thompson, Coe, Cousins & Irons, L.L.P., Dallas, TX, Kristy Blanchard, Blanchard & Thomas, LLP, Dallas, TX, for Relator.

David W. Elrod, Worthy W. Walker, Brian A. Farlow, Barbara L. Wohlrabe, Dallas, for Real party in interest.

Before Justices Evans, Brown, and Schenck

OPINION

Opinion by Justice Schenck

After the trial court granted real parties in interest's motion for summary judgment in this deed restriction case, the matter proceeded to a jury trial on attorney's fees pursuant to section 5.006 of the property code. TEX. PROP. CODE ANN. § 5.006 (West 2014). The jury returned a verdict awarding real parties in interest $290,000 in attorney's fees, rather than the full $579,954.45 they sought to recover. The trial court granted real parties in interest's request for a new trial.

Relator, BCH Development, LLC ("BCH"), filed a petition for writ of mandamus urging that we direct the trial court to vacate its new trial order because none of the specified reasons for ordering a new trial legally support relief in the form of a new trial. We agree and therefore conditionally grant mandamus relief and direct the trial court to vacate the September 21, 2016 Order Granting New Trial and enter a judgment on the jury verdict.

BACKGROUND

This case arises from BCH's attempt to construct a home with a habitable attic in the Lakeview Heights Addition. Barbara Wohlrabe and Lakeview Heights Addition Property Owners' Association (collectively, the "Association") brought suit against BCH and Blanchard Homes, LLC asserting they were breaching and violating deed restrictions and seeking to enjoin them from constructing a dwelling that has more than one above-ground level or floor of living space, and from constructing a dwelling that has a habitable attic. The Association also asserted a claim for tortious interference, which it later abandoned. After the trial court granted the Association's motion for summary judgment and permanently enjoined BCH from building a dwelling in the neighborhood in excess of one story and with a habitable attic, the Association nonsuited its claims against Blanchard Homes, LLC.

At trial, the only remaining issue was an award of attorney's fees under the property code. One of the Association's attorneys testified as the expert for the Association. He opined that fees in the amount of $579,954.45 were reasonable in pursuing the breach and violation of the deed restrictions claims in light of the extensive work that had been put into the case. On cross examination, he testified that the jury in a different, less complicated deed restriction case awarded $250,000 based on his testimony in that case. BCH's expert countered that the Association unnecessarily delayed seeking a summary judgment for a period of a year. The record—the Association's exhibit of its attorney's fees—shows that fees of approximately $361,000 accrued during the delay.¹ BCH's expert, who has handled hundreds of property owners' association cases, also testified as to what would be the reasonable hours expended during various phases of a deed restriction case. They totaled 500 to 600 hours. The jury returned a verdict awarding the Association $290,000. The Association moved for judgment notwithstanding the verdict or for a new trial. The trial court granted the Association's motion for new trial. This original proceeding followed.

STANDARD FOR GRANTING MANDAMUS—ORDER GRANTING NEW TRIAL

A trial court's order granting a new trial after a jury trial is subject to mandamus review. In re Zimmer, Inc. , 451 S.W.3d 893, 898 (Tex. App.—Dallas 2014, orig. proceeding) (citing In re United Scaffolding, Inc. , 377 S.W.3d 685, 688–89 (Tex. 2012) (orig. proceeding)). A new trial order must initially satisfy two "facial requirements." In re Bent , 487 S.W.3d 170, 173 (Tex. 2016) (orig. proceeding). One, the order must state a legally appropriate reason for the new trial. Id. Two, the stated reason must be specific enough to indicate that the trial court did not simply parrot a pro forma template but rather derived the articulated reason from the case's particular facts and circumstances. Id. The order must satisfy both requirements, or it reflects an abuse of discretion correctable by mandamus. See United Scaffolding , 377 S.W.3d at 688–89.

Further, even if a new trial order meets the facial requirements, a relator can show an abuse of discretion and an entitlement to mandamus relief if, after a merits review, the record does not support the trial court's rationale for ordering a new trial. Bent , 487 S.W.3d at 173 ; In re Toyota Motor Sales, U.S.A., Inc. , 407 S.W.3d 746, 749 (Tex. 2013) (orig. proceeding).

DISCUSSION

A. Were the trial court's reasons for ordering a new trial both sufficiently specific and legally appropriate?

The order in this case cites (1) BCH's violation of limine orders limiting the scope of BCH's attorney fee expert's testimony,² (2) BCH's improper jury argument attacking the Association and its attorneys, criticizing the use of a contingency fee agreement and lack of segregation of fees, and stating that $150,000 was a reasonable fee through trial, and (3) factual and legal insufficiency of the evidence to support the jury's award of $290,000 in attorney's fees, as its bases for granting a new trial. Violation of limine orders, improper jury argument, and insufficiency of the evidence, if established, can serve as legally proper reasons for granting a new trial. See In re United Servs. Auto. Ass'n, 446 S.W.3d 162, 174 (Tex. App.—Houston [1st Dist.] 2014, orig. proceeding) (the violation of a limine order can serve as a basis for a new trial order), mand. denied , 487 S.W.3d 170 (Tex. 2016) ; Living Ctrs. of Tex., Inc. v. Penalver , 256 S.W.3d 678, 681–82 (Tex. 2008) (holding that improper incurable jury argument is a legally appropriate ground for a new trial); Zimmer , 451 S.W.3d at 898 (noting that factual insufficiency of the evidence to support the jury's verdict, if established, is a legally proper reason for granting a new trial). Thus, the order complies with the first facial requirement. Toyota , 407 S.W.3d at 756–57.

The trial court's order also satisfies the second requirement of specificity. It recites the specific facts and circumstances of the case that led the trial judge to reach her conclusions. The order is specific enough both to permit BCH to attack it and to enable our review. See Zimmer , 451 S.W.3d at 898.

B. Were the trial court's reasons for granting a new trial valid and correct?

Simply articulating understandable, reasonably specific, and legally appropriate reasons is not enough to sustain a new trial order; the reasons must be valid and correct. Id. (citing Toyota , 407 S.W.3d at 759 ). We must conduct a careful "merits review" of the record. See Toyota , 407 S.W.3d at 759. In a mandamus proceeding, we may not substitute our judgment for that of the trial court. In re Sanders, 153 S.W.3d 54, 56 (Tex. 2004) (orig. proceeding). But neither may the trial court substitute its judgment for that of the jury in granting a new trial. In re Columbia Med. Ctr. of Las Colinas , 290 S.W.3d 204, 212 (Tex. 2009) (orig. proceeding); Toyota, 407 S.W.3d at 758 ("If ... a trial court's articulated reasons are not supported by the underlying record, the new trial order cannot stand."). Thus, using a factual sufficiency standard, we will engage in a review of the entire trial record to determine whether it supports the trial court's reasons for granting a new trial. See Bent , 487 S.W.3d at 180. If the record does not support the trial court's stated reasons, then the trial court will have abused its discretion in granting a new trial. See Toyota , 407 S.W.3d at 761 (holding the trial court abused its discretion by granting a new trial because the record did not support the articulated reason).

1. Limine Orders and Jury Arguments

As to the trial court's assertion that BCH's alleged violations of motion-in-limine orders are bases for granting a new trial, we note that the purpose of a motion in limine is to prevent a party from asking prejudicial questions and introducing evidence in front of the jury without first asking the court's permission. See Weidner v. Sanchez , 14 S.W.3d 353, 363 (Tex. App.—Houston [14th Dist.] 2000, no pet.). A motion in limine itself preserves nothing for review. In re R.V. Jr. , 977 S.W.2d 777, 780 (Tex. App.—Fort Worth 1998, no pet.). The complaining party must immediately object and also request the trial court to instruct the jury to disregard the evidence introduced in violation of a limine order. State Bar of Tex. v. Evans , 774 S.W.2d 656, 658 n.6 (Tex. 1989) (per curiam); Weidner , 14 S.W.3d at 363.

Before BCH called its expert witness to testify, the Association moved to exclude certain testimony of this witness, arguing BCH failed to disclose certain expert opinions the Association believed BCH would attempt to elicit based on BCH's opening statement. In response, the trial court ruled that BCH's expert would not be allowed to opine as to (1) the appropriate amount of fees that should be segregated, (2) the reasonable hourly rates in Dallas County (BCH conceded its expert would not be challenging the Association's expert's opinion on reasonable rates), and (3) the specific amount that should have been charged.

The trial court considered BCH's attempt to present testimony concerning the number of hours that would be reasonable for prosecution of a deed restriction case like this one, and attempt to present testimony that the Association's attorneys' "block billing" statements were somehow improper, to violate its limine orders. A review of the challenged comments reveals, however, that they did not reach into any of the topics precluded by the motion and the resulting order.

As for BCH's expert's...