Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Click here for the full text of this decision FACTS:In 1994, Lewis Qualls and Vernon Young engaged in a real estate development project in which Young provided the financing to purchase a 75-acre tract of land and Qualls agreed to develop the property into lots for sale. Although the parties had a written partnership agreement governing a previous project, they relied on an oral agreement for this development. Qualls and Young originally anticipated that the property would be developed as a mobile home rental park, but after they completed the purchase, they changed the deed restrictions to require use as a single-family residential subdivision. Qualls and his wife worked in an office on the site and cleared the property for development, and Young paid the costs associated with those activities. Qualls failed to sell any lots by June 1996. Young stopped paying Qualls’ bills and instructed the couple to vacate the property, which they did. Young then changed the deed restrictions again and converted the project back to a mobile home park. Two years later, Qualls filed suit for breach of the partnership agreement. At trial, Qualls presented evidence of acquisition and development costs incurred as of the time he was ousted, and Qualls’ expert testified to the property’s market value at the time of trial. The 7th Court of Appeals held that the record would support an award under Qualls’ damage theory of no more than $54,751.50. The court suggested a remittitur of the difference between this amount and the jury’s $142,550 award, which Qualls accepted. HOLDING:Reversed and remanded. Appealing the matter to the Texas Supreme Court, Young contended that the 7th Court improperly analyzed the damages evidence by failing to credit his testimony about additional liabilities incurred after Qualls vacated the property. According to Young, the 7th Court’s determination that the jury could disregard his testimony improperly placed the burden of proof on him to prove the partnership’s fair value rather than on Qualls. The court disagreed. It stated that Young’s testimony regarding additional liabilities incurred after Qualls vacated the property, though uncontested, was unsubstantiated and self-serving, and thus evidence of the type that the jury could disregard. Young also contended that the reduction of damages resulting from the 7th Court’s remittitur required a new trial on attorneys’ fees. First, the court found that Young did not waive his right to seek a new trial on attorneys’ fees. The court cited its holding in Barker v. Eckman that unless an appellate court is “reasonably certain that the jury was not significantly influenced by the erroneous amount of damages it considered,” the issue of attorneys’ fees should be retried if the damages awarded are reduced on appeal. Qualls, the court stated, argued that a new trial on attorneys’ fees was not warranted, because the parties stipulated that the trial court could set the amount of attorneys’ fees based upon the affidavits of counsel, and those affidavits contain time records and testimony that support the trial court’s award. The court stated that upon consideration of the correct results obtained, this evidence would perhaps be factually sufficient to support the same fee award. But taking into account the difference between the erroneous and correct amounts of damages, and the fact that the jury award was reduced by nearly two-thirds on appeal, the court stated it could not be reasonably certain that the trial court was not significantly affected by the error. OPINION:Per curiam. Johnson, J., did not participate in the decision.

Want to continue reading?
Become a Free ALM Digital Reader.

Benefits of a Digital Membership:

  • Free access to 1 article* every 30 days
  • Access to the entire ALM network of websites
  • Unlimited access to the ALM suite of newsletters
  • Build custom alerts on any search topic of your choosing
  • Search by a wide range of topics

*May exclude premium content
Already have an account?


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.