Trinity Western Title Company, Inc., Appellant v. Glenn D. Thompson and James E. Phillips, Appellees. (2000)

MEMORANDUM OPINION 1

Appellant Trinity Western Title Company appeals the trial court's denial of its request for attorney's fees from appellees Glenn D. Thompson and James E. Phillips.  Because the trial court abused its discretion in not awarding attorney's fees in Trinity's favor, we reverse the trial court's judgment regarding Trinity's attorney's fees.

In 1996, Thompson and Phillips sold their home in Lewisville to Myart Homes, Inc. They then bought another home from Myart.  Trinity acted as the escrow agent for both contracts.  The earnest money contract provided that “[i]f Buyer, Seller, Listing Broker, Other Broker or Escrow Agent is a prevailing party in any legal proceeding brought under or with relation to this contract, such party shall be entitled to recover from the non-prevailing party all costs of such proceeding and reasonable attorney's fees.”  [Emphasis added.]

Thompson and Phillips became dissatisfied with their home and sued Myart and David M. Jones, the owner of Myart, for violating the Deceptive Trade Practices Act, breach of contract, breach of warranty, fraud, and conspiracy.  Thompson and Phillips also brought claims against Trinity for violating the DTPA, fraud, and conspiracy.  In its answer and subsequent motion for summary judgment, Trinity pleaded for attorney's fees based on the terms of the earnest money contract.

The trial court granted summary judgment in favor of Trinity, but reserved Trinity's claims for attorney's fees for trial.  At trial, Trinity put on evidence of the amount of its attorney's fees.  The trial court then ruled in favor of Thompson and Phillips on their claims against Myart and Jones regarding breach of contract, negligence, negligent misrepresentation, fraud, and DTPA violations.  Based on the trial court's finding that Myart's and Jones's conduct was knowing, the trial court awarded Thompson and Phillips attorney's fees.  The trial court denied Trinity's claim for attorney's fees.  Trinity appeals and argues in a sole issue that the trial court abused its discretion in failing to award it attorney's fees as a prevailing party.²

To determine whether a trial court abused its discretion, we must decide whether the trial court acted without reference to any guiding rules or principles;  in other words, whether the act was arbitrary or unreasonable.³  Under an abuse-of-discretion standard, legal and factual sufficiency are relevant factors in assessing whether the trial court abused its discretion.⁴  However, merely because a trial court may decide a matter within its discretion in a different manner than an appellate court would in a similar circumstance does not demonstrate that an abuse of discretion has occurred.⁵  Furthermore, an abuse of discretion does not occur as long as some evidence of substantive and probative character exists to support the trial court's decision.⁶

As discussed above, Trinity pleaded for its attorney's fees under the terms of the earnest money contract and proved up the amount of its attorney's fees at trial.  Thompson and Phillips do not dispute the amount Trinity proved, they merely argue that Trinity is not entitled to attorney's fees because (1) Trinity was not sued under the earnest money contract and was not a party to the contract;  (2) Thompson and Phillips are the prevailing parties;  and (3) Trinity presented no evidence of entitlement to attorney's fees.

First, Trinity was a party to the earnest money contract.  Trinity was the escrow agent for the transactions;  thus, the contract explicitly applied to it.  Further, we have implicitly held that an escrow agent is a party to an earnest money contract so as to be able to recover attorney's fees based on the provisions of the earnest money contract.⁷  Although Thompson and Phillips did not sue Trinity for breach of contract, Trinity was sued under the terms of the earnest money contract.  Thompson's and Phillips's suit is “related” to the contract even though they only raised tort claims against Trinity.⁸  In sum, Trinity can rely on the earnest money contract to recover its attorney's fees.

Second, Trinity is a prevailing party.  For purposes of awarding attorney's fees, a prevailing party is one who successfully prosecutes an action or successfully defends against an action on the main issue.⁹  Trinity successfully defended against Thompson's and Phillips's claims brought against it.  Merely because Thompson and Phillips recovered against Myart and Jones does not transform Trinity into a non-prevailing party.

Third, Trinity adequately proved its right to attorney's fees.  To be entitled to an attorney's fees award, a claimant must specifically plead the basis for awarding attorney's fees and must prove the amount and reasonableness of such an award.¹⁰  Trinity did both in the trial court.  Trinity gave fair notice to Thompson and Phillips that it was asking for attorney's fees based on the explicit terms of the earnest money contract.  If there was no authority for the attorney's fees award, Thompson and Phillips were required to specially except to Trinity's pleading.¹¹

Accordingly, because Trinity was a party to the earnest money contract, was a prevailing party, and proved its right to attorney's fees and because Thompson's and Phillips's suit was related to the contract, the trial court abused its discretion in not awarding it attorney's fees.  We sustain Trinity's sole issue and reverse and render judgment that Trinity is awarded attorney's fees in the amount proved in the trial court.¹²

FOOTNOTES

1.   See T EX R.App. P. 47.1.

2.   Although Trinity phrases its issue to attack the trial court's ruling as against the great weight and preponderance of the evidence, it sets out in its brief that the correct standard of review is abuse of discretion.  Accordingly, we will review the trial court's attorney's fees ruling for an abuse of discretion.

3.   See Geode v. Shoukfek, 943 S.W.2d 4-41, 446 (Tex. 1997); Downer v. Aquamarine Operators, Inc., 781 S.W.2d 238, 241-42 (Tex. 1985), cert denied, 476 U.S. 1159 (1986).

4.   See Beaumont Bank v. Buller, 806 S.W.2d 223, 226 (Tex.1991);  Texas Dep't of Health v. Buckner, 950 S.W.2d 216, 218 (Tex.App.—Fort Worth 1997, no pet.).

5.   See Downer, 701 S.W.2d at 241–42.

6.   See Holley v. Holley, 864 S.W.2d 703, 706 (Tex.App.-Houston [1 st Dist.] 1993, writ denied).

7.   See Dickerson v. Trinity–Western Title Co., 985 S.W.2d 687, 688, 692 (Tex.App.—Fort Worth 1999, pet. denied).

8.   Id. at 692.

9.   See Emery Air Freight Corp. v. General Transp.  Sys., Inc., 933 S.W.2d 312, 316 (Tex.App.—Houston [14th Dist.] 1996, no writ).

10.   See 6 Texas Torts & Remedies § 105.02[5] (J. Hadley Edgar, Jr. & James B. Sales eds., 2000).

11.   See Tex.R. CIV. P. 91;  Bullock v. Regular Veteran's Ass'n, 806 S.W.2d 311, 314 (Tex.App.—Austin 1991, no writ).

12.   See 6 Texas Torts & Remedies § 105.02[6] (J. Hadley Edgar, Jr. & James B. Sales eds., Supp.2000) (stating appellate court may reverse and render when attorney's fees have been conclusively proven).

PER CURIAM