Attorney's Fees Update - Vinson & Elkins LLP

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See id. As such, in any matter that includes noncompensable claims, segregation will be required even if the proof would show that the vast majority of fees relate to recoverable-fee claims. Chapa’s segregation requirement has been applied in the following other recent cases: • A real estate vendor that sued a buyer to recover the balance due on a purchase note was entitled to recover its fees to defend the debtor’s counterclaim that the land conveyed was short acreage, because the counterclaim was a defense to recovery on the main action. The vendor was not, however, entitled to recover fees associated with a subsequently-added claim against the title insurer in the transaction, which was not necessary to collect on the note. See Varner v. Cardenas, 218 S.W.3d 68, 69 (Tex. 2007) (per curiam). • The Texas Supreme Court reversed an award of attorney’s fees and remanded for a new trial where the plaintiff pled and obtained jury verdicts on a breach of contract theory as well as five separate tort theories, but failed to segregate fees as between the six causes of action. See A.G. Edwards & Sons, Inc. v. Beyer, 235 S.W.3d 704, 710 (Tex. 2007) (plaintiff elected to recover on breach of contract rather than tort causes of action where broker failed to add her as joint owner of her father’s brokerage account prior to his incapacity and death). • The Fourteenth Court of Appeals reversed and remanded an attorney’s fee award where the plaintiff failed to segregate fees as between a breach of contract claim and an implied warranty of suitability claim. See 7979 Airport Garage, L.L.C. v. Dollar Rent A Car Systems, Inc., No. 14-05-00484-CV, 2007 WL 1732223, *15-16 (Tex. App.—Houston [14th Dist.] Apr. 27, 2007, no pet. h.). The plaintiff lessee had failed to segregate fees incurred as to its breach of contract claim, its implied warranty claim, and its defense of the lessor’s counterclaims. See id. at *13-14. The appeals court, noting that the claims and counterclaims depended on the same essential facts, documents, witnesses, and evidence, concluded that fees did not need to be segregated as between the contract claim and the counterclaim. See id. at *15. The plaintiff lessee was required, however, to segregate its fees related to the O-9 breach of warranty action, which the lessee had not contended was a claim for an oral or written contract that would give rise to Chapter 38 fee recovery. See id. Finding that the evidence as to the total amount of fees incurred was at least some evidence of what the reasonable segregated fee would have been, the court remanded for a new trial on attorney’s fees. See id. at *16. 2. Manner and sufficiency of segregation The Texas Supreme Court made it clear that the Chapa rule does not require attorneys to keep separate time sheets for their recoverable-fee and unrecoverable-fee work. See Chapa, 212 S.W.3d at 314. Rather, a fee claimant may submit an opinion as to the percentage of time spent on a given task that would have been necessary even in the absence of the unrecoverable-fee claim. See id. Even if the absence of segregation, proof of unsegregated fees is some evidence of proper segregated fees; hence, if a party fails to segregate fees, remand is required. See Chapa, 212 S.W.3d at 314; 7979 Airport Garage, 2007 WL 1732223 at *16. However, the failure to prove the specific segregation of recoverable from unrecoverable fees does not require reversal if the record evidence demonstrates that the attorney’s writeoffs and discounts attributable to the unrecoverable-fee claims, together with any reductions in the fee award made by the trial court, exceed the amount of fees that would have been attributable to the unrecoverable-fee claim. See Diamond, 239 S.W.3d at 432-33. D. Must establish trial and appellate fees separately A trial court’s award of attorney’s fees may include appellate attorney’s fees, but “there must be evidence of the reasonableness of the fees pertaining to the appellate work, and the trial court must condition the award of attorneys’ fees to an appellee upon the appellant’s unsuccessful appeal.” See Walker, 228 S.W.3d at 409 (citing Jones v. American Airlines, Inc., 131 S.W.3d 261, 271 (Tex. App.—Fort Worth 2004, no pet.)).
To recover appellate fees and post-judgment fees, a party must prove those fees up in the initial trial. See Varner v. Cardenas, 218 S.W.3d 68, 69-70 (Tex. 2007) (per curiam) (where party failed to submit evidence of postjudgment foreclosure costs or appeal at trial, it could not newly seek recovery of those fees after appeal on remand). III. SPECIFIC TYPES OF CLAIMS Correctly identifying the basis for recovering fees is crucial both to proving an entitlement to fees and to preserving error when fees are denied. When a party pleads a specific ground for recovery of attorney’s fees, the party is limited to that ground and cannot recover attorney’s fees on another, unpled ground. See Kreighbaum v. Lester, No. 05-06-01333-CV, 2007 WL 1829729, *2-3 (Tex. App.—Dallas June 27, 2007, no pet. h.) (because appellants’ counterclaim specifically requested attorney’s fees under section 17.50(c) of the Business and Commerce Code, appellant could not seek fees on another basis in reliance on a prayer for relief containing a nonspecific request for attorney’s fees). Below, we address recent cases on specific grounds for fee recovery: A. CPRC Chapter 38 Recovery 1. Types of actions covered Under section 38.001 of the Civil Practice and Remedies Code, a person may recover reasonable attorney’s fees from an individual or corporation, in addition to the amount of a valid claim and costs, if the claim is for: (1) rendered services; (2) performed labor; (3) furnished material; (4) freight or express overcharges; (5) lost or damaged freight or express; (6) killed or injured stock; (7) a sworn account; or (8) an oral or written contract. O-10 TEX. CIV. PRAC. & REM CODE § 38.001. Recently, the Dallas Court of Appeals held that a party cannot recover attorney’s fees under a breach of express warranty claim pursuant to section 38.001(8) because express warranty claims are distinct from breach of contract claims. Carlisle Corp. v. Medical City Dallas, Ltd., 196 S.W.3d 855 (Tex. App.—Dallas 2006, review granted); see also Harris Packaging Corp. v. Baker Concrete Const. Co., 982 S.W.2d 62, 69 (Tex. App.—Houston [1 Dist.] 1998 pet. denied) (overruling arguments that an express warranty is merely a function of a contract, and therefore should fall within TEX. CIV. PRAC. & REM CODE § 38.001); cf. 7979 Airport Garage, 2007 WL 1732223 at *15 (stating in dictum that the implied warranty of suitability with respect to a property lease does not independently qualify for Chapter 38 recovery, but collecting contrary authority and stating that the court was “mindful of the large body of case law stating that an implied warranty becomes part of the terms of a contract”). The Carlisle court relied in large part on a 1991 supreme court case, Southwestern Bell Telephone Co. v. FDP Corp., 811 S.W.2d 572 (Tex. 1991), in which the supreme court observed that the remedies and elements of warranty and contract claims differ, and that while certain warranty claims are actionable under the Deceptive Trade Practices Act, ordinary breaches of contract are not. See Carlisle, 196 S.W.3d at 869 (citing Southwestern Bell Telephone Co., 811 S.W.2d at 576). The Carlisle court, citing U.C.C. commentary to the effect that the U.C.C. does not interfere with common law doctrines enlarging warranty law beyond the scope of contractual privity, distinguished cases holding that warranties necessarily arise out of contracts. See id. (citing TEX. BUS. & COM. CODE ANN. § 2.313 cmt. 2; distinguishing Coca Cola Bottling Co. v. Enas, 164 S.W.2d 855, 857 (Tex. Civ. App.—Amarillo 1942, writ ref’d w.o.m.) (“[I]t is established law that no warranty, whether expressed or implied, can be created except by, or as the result of, a contract.”); Coca-Cola Bottling Co. v. Smith, 97 S.W.2d 761, 766 (Tex. Civ. App.—Fort Worth 1936, no writ) (“We recognize the universal rule that a warranty, either express or implied, must grow out of contractual relations between the parties.”)).
Page 1 and 2: ATTORNEY’S FEES UPDATE Jason M. P
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Page 5 and 6: (2) the likelihood that the accepta
Page 7 and 8: A longstanding relationship with a
Page 9 and 10: amount requested for appellate fees
Page 11: When reviewing an award of fees in
Page 15 and 16: damages. The jury found the demand
Page 17 and 18: case. See id. at *17. The appeals c
Page 19 and 20: educe the amount collected on the n
Page 21 and 22: finding because plaintiff’s couns
Page 23 and 24: appeals court of jurisdiction where
Page 25: clients may recover attorney’s fe

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