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Click here for the full text of this decision FACTS:Woody Lesikar and Carolyn Ann Lesikar Moon are the children of Woodrow V. Lesikar. In January 1990, Woodrow established the Woodrow V. Lesikar Family Trust, naming himself and Woody as co-trustees. In 1991, Woodrow revoked, in writing, part of the family trust. On March 16, 1998, Woodrow amended the family trust, effective as of Dec. 31, 1997. After the distribution of other bequests, the amended family trust provided that the remainder of the trust assets would be divided equally between Woody and Carolyn and placed into a special trust for each of them. Woody would be the trustee of his special trust, while Carolyn would be the trustee of her special trust. Woodrow died on Jan. 28, 2001, thereby making the amended family trust irrevocable and Woody the sole trustee of the Family Trust. On Aug. 19, 2003, Carolyn filed a petition for construction of the trust, declaratory judgment, accounting, imposition of a constructive trust, appointment of a receiver and injunctive relief. Carolyn alleged claims against Woody for breach of fiduciary duty, conversion, negligence, civil conspiracy and tortious interference with inheritance. Relevant to this appeal, Carolyn sought to compel Woody to fund and relinquish control of her special trust. On July 22, 2004, Carolyn filed a motion for partial summary judgment arguing that she, not Woody, was trustee of her special trust. Carolyn further requested that the trial court order Woody to partition the then-existing family trust assets, distribute her share of the assets to her special trust, and relinquish control of her special trust to her as trustee of her trust. In his response to Carolyn’s motion for partial summary judgment, Woody argued that because, in his belief, Carolyn was unable to manage her share of the family assets, he had discretion to not fund her special trust. Woody also filed a countermotion for summary judgment in which he similarly argued that he had discretion to determine whether to make distributions to Carolyn’s special trust. On March 28, 2005, the trial court granted Carolyn’s motion for summary judgment, finding, as a matter of law, Carolyn to be the trustee of her special trust, and denied Woody’s countermotion for summary judgment on this issue. On Nov. 8, 2004, the trial court, on its own motion, appointed a special master to examine the family trust’s books and records, devise a plan for the distribution of the family trust assets and prepare a report to the court. On May 27, 2005, Woody filed a second supplemental answer, plea to the jurisdiction, special exceptions and counterclaim, alleging that Carolyn, by filing and pursuing her action, contesting the terms of the trust declaration creating the family trust and the operations and distributions of the trust, had forfeited her interest in the trust under the trust’s in terrorem clause. Woody also filed a motion for interlocutory summary judgment, arguing that under the in terrorem clause, Carolyn forfeited her share of the Family Trust by bringing the suit at issue. Carolyn filed a motion to strike Woody’s second supplemental answer and his motion for interlocutory summary judgment. The trial court did not rule on either Woody’s motion for summary judgment or Carolyn’s motion to strike. On June 6, 2005, the trial court adopted, in part, the special master’s report. The trial court did not adopt the report with respect to an issue regarding a $200,000 contingent fee liability, reserving that issue for trial. On June 10, 2005, the trial court conducted a bench trial on the $200,000 contingent fee liability issue and Carolyn’s attorney fees. On Sept. 13, 2005, the trial court entered a final judgment specifying: which trust assets would be distributed to Woody’s and Carolyn’s special trusts and which assets would remain in the family trust for distribution to other beneficiaries. The final judgment also awarded Carolyn $400,000 in attorneys’ fees, after being adjusted to equalize the division of assets between Woody’s and Carolyn’s special trusts and the family trust, resulting in a net attorney fee award of $273,257. The judgment also stated that Carolyn nonsuited her other causes of action still pending in the case without prejudice to refiling. On appeal, Woody argued that the trial court: improperly interfered with his discretion as trustee; erred in finding Carolyn the trustee of her special trust; erred in rejecting his in terrorem defense; erred in adopting the special master’s report and denying him a jury trial; and abused its discretion in awarding Carolyn $400,000 in attorneys’ fees. HOLDING:Affirmed in part, reversed and remanded in part. In his first issue, Woody claims the trial court interfered with his discretion as trustee by ordering him to fund Carolyn’s special trust, without a predicate finding of fraud, misconduct or abuse of discretion. Carolyn asserted that under the amended family trust, Woody had no discretion not to fund her special trust. A trial court, the court stated, may not substitute its discretion for that of the trustee and may interfere with the trustee’s discretionary powers only in the case of fraud, misconduct or clear abuse of discretion. Carolyn maintained that upon Woodrow’s death, the amended trust imposed a mandatory duty on the trustee to divide the trust assets into two special trusts: one for Carolyn and one for Woody. The court agreed with Carolyn’s interpretation. Because Woody had no discretion not to fund Carolyn’s special trust, the court stated that it was not necessary for the trial court to make of finding of fraud, misconduct or abuse of discretion. In his fourth issue, Woody asserted that the trial court erred in granting partial summary judgment in favor of Carolyn, when it found as a matter of law that she was the trustee of her special trust. Woody argued that it was his obligation under the ward trust provision of the amended family trust not to distribute the assets to Carolyn directly because of a history of instability in her personal life and her inability to manage her financial affairs. The amended family trust, however, was clear that Carolyn was the trustee of her own trust. Thus, the court stated that the trial court did not err in granting Carolyn’s motion for partial summary judgment and finding her to be trustee of her special trust. In his second issue, Woody contended that the trial court erred in awarding relief to Carolyn, because her breach of fiduciary claim against him violated the in terrorem clause in the amended family trust, resulting in the forfeiture of her interest in the family trust. The court, however, stated that in terrorem clause, the court stated, are violated only when the acts of the parties clearly fall within its express terms. The clause at issue did not cover breach of fiduciary duty claims, the court stated. Thus, the court concluded that Carolyn’s breach of fiduciary duty claim against Woody did not violate the in terrorem clause and therefore did not result in the forfeiture of her share of the family trust. In his third issue, Woody asserted that the trial court improperly adopted the special master’s report over his objections and denied him a jury trial on the merits. The trial court states it adopted the special master’s report on June 6, 2005, and Woody did not object until two days later, the court noted. But even if Woody’s June 8 objections to the special master’s report had been timely, the court found them insufficient to preserve error. In his fifth issue, Woody claimed that legally insufficient evidence supported the trial court’s finding that $400,000 was a reasonable and necessary attorneys’ fee under Texas Civil Practice & Remedies Code �37.009 and Texas Property Code �114.064. When the plaintiff seeks to recover attorneys’ fees in a case involving multiple claims, at least one of which supports an award of fees and at least one of which does not, the plaintiff must offer evidence segregating attorneys’ fees among various claims. An award of attorneys’ fees based on unsegregated fees requires a remand, the court stated. Woody stipulated to the qualifications of Carolyn’s attorneys Bobbie Bayless, Brett Wagner and Vaughn Stewart. Bayless, whose practice was “commercial/civil litigation,” was board certified in civil trial law. Bayless testified she, Wagner and Stewart spent a total of 2,500 hours on this case. Based on an hourly fee of $300 for each of three attorneys for 2,500 hours spent on the case, the total fee would be $750,000. However, Bayless opined a reasonable fee would be $500,000. Bayless further reduced that amount to $400,000, or 1,300 hours under the hourly billing rate, by excluding time spent on the proceedings involving Carolyn’s challenge to the sale of the airport stock to Woody. Bayless testified she had a 40 percent contingent- fee contract with Carolyn. It is estimated that Carolyn’s half the of the residue of the family trust was $1 million, resulting in a $400,000 fee to Carolyn’s attorneys under the contingency fee contract. Bayless, however, explained she was testifying about a reasonable fee. Bayless kept some time records but did not bring them to trial. Bayless could not break down in detail how much time was spent attending each hearing or preparing each pleading but instead broke down the hours that Carolyn’s attorneys spent on larger aspects of the case. The trial court observed that the total amount of time expended by Carolyn’s attorneys was closer to 2,000 hours, rather than the initial 2,500-hour figure. However, Bayless had already agreed to reduce the amount of time on which she based their request for attorneys’ fees to about 1,300 hours. One of Woody’s trial attorneys, William Denman, testified that in his opinion, real estate, probate and trust litigators do not charge more than $250 an hour in Brazoria County. Denman also opined it is not reasonable for three lawyers to charge a total of $900 an hour to prepare and present this case at trial; instead, a case this size would require two attorneys at a total of $500 an hour. Time records, the court noted, reflect that Woody’s attorneys spent 700 hours on the case. Denman testified it is unusual to have “plaintiff’s counsel spend more hours on a case than defense counsel.” Both sides stipulated that Woody’s attorneys’ fees were $153,000. Here, Bayless had no knowledge of Wagner’s or Stewart’s hourly rates. Although Woody stipulated to Wagner’s and Stewart’s qualifications, Bayless did not testify as to their experience justifying the $300 hourly rate for each of them. Bayless kept some time records but she did not bring them to the trial. She was not aware of any time records kept by Wagner or Stewart. Bayless gave rough estimates of the amount of time spent by her, Wagner and Stewart on general, but not specific, aspects of the case. Moreover, the court stated, while Bayless testified she was segregating the amount of time spent on the challenge to the sale of the airport stock to Woody, she provided no testimony that she was segregating time spent on Carolyn’s other tort claims, i.e., breach of fiduciary duty (not related to sale of airport stock), negligence, interference with inheritance, conversion and civil conspiracy, which she nonsuited and for which attorneys’ fees may not be recovered, from the trustee issue. Thus, the court held that when the plaintiff seeks to recover attorneys’ fees in a case involving multiple claims, at least one of which supports an award of fees and at least one of which does not, the plaintiff must offer evidence segregating attorneys’ fees among various claims. An award of attorneys’ fees based on unsegregated fees requires a remand, the court stated. Because Carolyn failed to segregate attorneys’ fees, the court remanded the case for redetermination of attorneys’ fees. OPINION:Hudson, J.; Yates, Anderson and Hudson, JJ.

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