Jim Walter Homes, Inc. v. Valencia
| Decision Date | 17 April 1985 |
| Docket Number | No. C-3608,C-3608 |
| Citation | 690 S.W.2d 239 |
| Parties | JIM WALTER HOMES, INC. et al., Petitioners, v. Jose B. VALENCIA et al., Respondents. |
| Court | Texas Supreme Court |
Atlas and Hall, Lisa Powell, David Hockema and Charles W. Hury, McAllen, for petitioners.
B. Miles Latham, Corpus Christi, for respondents.
The questions considered are whether the trial court properly calculated damages resulting from a knowing violation of the Texas Deceptive Trade Practices-Consumer Protection Act (DTPA), TEX.BUS. & COM.CODE ANN. §§ 17.41-. 63 (Vernon Supp.1985); whether there is some evidence to support the jury's finding that Jim Walter Homes, Inc. and Mid-State Homes, Inc. (Jim Walter Homes) knowingly violated the DTPA; and whether the Valencias gave Jim Walter Homes sufficient notice of their DTPA claim. Jim Walter Homes was found to have violated both the DTPA and the Texas Consumer Credit Code (Credit Code), TEX.REV.CIV.STAT.ANN. art. 5069-6.01 to 6.09 (Vernon Supp.1985). Judgment was rendered that the Valencias recover $49,728 based upon the DTPA violation and that Jim Walter Homes forfeit all amounts owing on the construction of the house based upon the Credit Code violation. The court of appeals affirmed. 679 S.W.2d 29. We modify the judgment of the court of appeals and affirm that judgment as modified.
Jose and Elodia Valencia entered into a contract with Jim Walter Homes for the construction of a house on the Valencias' property. Under the terms of the contract, the Valencias were to pay the total price of the house in 180 monthly installments after "release" of the house to them. Jim Walter Homes secured payment of the debt by executing a Mechanics Lien Contract with Power of Sale.
Jim Walter Homes "released" the house to the Valencias and awaited payment. The Valencias did not make payment and after the third monthly payment had accrued, Jim Walter Homes accelerated the note and attempted foreclosure. The Valencias then sought to enjoin the foreclosure and to recover damages under the DTPA and the Credit Code. Jim Walter Homes counterclaimed for the amounts due under the contract. The alleged Credit Code violations and Jim Walter Homes's counterclaim were tried to the court. The alleged DTPA violations were tried to a jury.
The jury found that Jim Walter Homes had represented that the house was constructed in a good, substantial, and workmanlike manner but that it was not so constructed; that this act was a producing cause of the Valencias' damages; and that the Valencias had sustained actual damages of $12,682. The jury further found that Jim Walter Homes "knowingly" made the misrepresentations to the Valencias and the jury awarded the Valencias the sum of $38,046 in discretionary additional damages based on the knowing violation. Based on these jury findings and after a remittitur of $3000, the trial court rendered judgment for the Valencias on their DTPA claim for $49,728.
We first consider the method used to calculate the Valencias' damages. Section 17.50(b)(1) of the DTPA provides that a consumer who prevails may obtain:
the amount of actual damages found by the trier of fact. In addition the court shall award two times that portion of the actual damages that does not exceed $1000. If the trier of fact finds that the conduct of the defendant was committed knowingly, the trier of fact may award not more than three times the amount of actual damages in excess of $1000.
The trial court arrived at the $49,728 figure by first awarding the Valencias $12,682 in actual damages under sentence number one of section 17.50(b)(1). Next, the court awarded them $2000 under the second sentence. To these amounts, the trial court added three times the amount of their actual damages in excess of $1000. This method of calculation resulted in quadrupling actual damages less $1000. Relying on what it believed to be the plain meaning of the statute and the apparent legislative intent in amending section 17.50(b)(1), the court of appeals affirmed this method of calculation.
The court of appeals holding conflicts with another recent court of appeals decision. In Jasso v. Duran, 681 S.W.2d 279 (Tex.App.--Houston [14th Dist.] 1984, writ pending), the court modified the trial court's judgment to award the prevailing consumer who received the maximum award on his claim an amount equal to three times actual damages. The court reasoned that section 17.50(b)(1) clearly disallowed a quadrupling of damages and that the legislature never intended to authorize quadrupling under any circumstances.
The present case is governed by the 1979 amendments to the DTPA. This is the first time this court has been presented with the issue of how damages should be calculated under section 17.50(b)(1) as it was amended. We noted in Martin v. McKee, 663 S.W.2d 446, 447 (Tex.1984), that there are three types of damages described by the section; however, the only issue we considered in that case was whether the plaintiff waived recovery of discretionary damages under sentence three of the section by failing to request a special issue on these damages. In Luna v. North Star Dodge Sales, Inc., 667 S.W.2d 115, 116 (Tex.1984), we recited the trial court's calculation of damages but we did not decide whether the trial court applied the correct method of calculation.
Prior to enactment of the 1979 amendments to the DTPA, trebling of any actual damages was mandatory. Woods v. Littleton, 554 S.W.2d 662, 669 (Tex.1977). A seller could be held liable for treble damages even for innocent misrepresentations. We find that the legislature sought to mitigate the harsh effects of this rule without leaving consumers unprotected from deceptive practices. We further find that the legislature sought to achieve three things by amending section 17.50(b)(1): (1) to preserve mandatory treble damages for consumers with small claims causes of action; (2) to eliminate automatic treble damages against sellers who make innocent misrepresentations; and (3) to allow consumers to recover treble damages at the discretion of the trier of fact in cases of knowing violations of the DTPA. Debate on S.B. 357 on the Floor of the House, 66 Leg. (May 10 and 11, 1979) (on tape). The legislature implemented its goals by providing in the first two sentences of section 17.50(b)(1) for the mandatory trebling of that portion of actual damages that does not exceed $1000 in all DTPA cases. In the third sentence of section 17.50(b)(1), the legislature allowed the trier of fact to award in its discretion "not more than three times the amount of actual damages in excess of $1000" in cases in which the deceptive act or practice is...
To continue reading
Request your trial
-
Ppg Industries v. Jmb/Houston Centers
...See Woods, 554 S.W.2d at 669. But as treble damages have not been mandatory for twenty-five years, see Jim Walter Homes, Inc. v. Valencia, 690 S.W.2d 239, 241 (Tex.1985), it is unclear why we should make DTPA claims assignable 44. See, e.g., Copper Liquor, Inc. v. Adolph Coors Co., 506 F.2d......
-
Tomlinson v. Clem (In re Clem)
...554 S.W.2d 662, 670 (Tex. 1977) ). See also Eckman v. Centennial Sav. Bank , 784 S.W.2d 672, 675 (Tex. 1990) ; Jim Walter Homes, Inc. v. Valencia , 690 S.W.2d 239, 242 (Tex. 1985) ; Cameron v. Terrell & Garrett, Inc., 618 S.W.2d 535, 540 (Tex. 1981) ; Joseph v. PPG Indus., Inc., 674 S.W.2d ......
-
Farooqi v. Carroll (In re Carroll)
...held that the maximum amount of damages for a knowing violation of the DTPA is three times the actual damages. Jim Walter Homes, Inc. v. Valencia, 690 S.W.2d 239 (Tex.1985). “Knowingly” is defined in the DTPA as actual awareness, at the time of the act or practice complained of, of the fals......
-
In re Francis
...248 (1986). 24. See Hines, 843 S.W.2d at 466-67. 25. Id. at 467. 26. Id. at 468. 27. Id. at 468 (quoting Jim Walter Homes, Inc. v. Valencia, 690 S.W.2d 239, 242 (Tex. 1985)). 28. Id. at 469. 29. 71 S.W.3d at 318. 30. Id. at 317-18. 31. Id. 32. Of course, such relief is constrained by the el......
-
Initial Client Contacts (Plaintiff)
...Dist.] 1996, no writ reported) (statement that contract with third party existed when it did not); Jim Walter Homes, Inc. v. Valencia, 690 S.W.2d 239 (Tex. 1985), (statement that house would be built in a good and work-manlike manner); Hurst v. Sears, Roebuck & Co ., 647 S.W.2d 249 (Tex. 19......
-
Appendix - Desk Book
...burden of proof and numerous defen ses encountered in a common law fraud or breach of warranty suit. Jim Walter Homes, Inc. v. Valen cia, 690 S.W.2d 239 (Tex. 1985). Relying upon Pennington v. Singleton , supra , the Court states that the purposes of multiple damages are two fold: (1) to en......
-
Table of Cases
...Jim Walters Home, Inc. v. Samuel , 701 S.W.2d 351 (Tex. App.—Beaumont 1985, no writ), §1.02.14.5 Jim Walter Homes, Inc. v. Valencia, 690 S.W.2d 239, 242 (Tex. 1985), §§1.02.8.1, 1.02.14.2.2, 3.02 Johnson & Higgins, Inc. v. Kenneco Energy , 962 S.W.2d 507, 515 (Tex. 1998), §§10.16, 10.26 Joh......
-
Automatic Consumer Protection Act Recovery for Lack of Informed Consent: Quimby v. Fine
...690-91 (Tex. 1980) (imposition of treble damages on seller who knowingly made misrepresentations); Jim Walter Homes, Inc. v. Valencia, 690 S.W.2d 239, 241 (Tex. 1985) (two of the legislative goals behind the 1979 amendments to the Deceptive Trade Practices Act were to eliminate mandatory tr......