Court Opinion

ID: 9838134
Source: CourtListenerOpinion
Date Created: 2023-09-05 13:09:14.924824+00
Date Added: 2024-06-11T15:34:22.723226
License: Public Domain

Fourth Court of Appeals
                                      San Antonio, Texas
                                  MEMORANDUM OPINION

                                          No. 04-22-00307-CV

                                         Daniel W. HAWKINS,
                                                Appellant

                                                     v.

                                           Bobby HORTON,
                                               Appellee

                      From the 216th Judicial District Court, Kerr County, Texas
                                      Trial Court No. 20252A
                          Honorable Albert D. Pattillo, III, Judge Presiding

Opinion by:       Rebeca C. Martinez, Chief Justice

Sitting:          Rebeca C. Martinez, Chief Justice
                  Lori I. Valenzuela, Justice
                  Sandee Bryan Marion, Chief Justice (Retired) 1

Delivered and Filed: August 30, 2023

AFFIRMED AS MODIFIED

           Daniel W. Hawkins appeals following a bench trial in this suit on a promissory note. In

seven issues, Hawkins challenges the trial court’s judgment awarding Bobby Horton damages and

attorney’s fees and denying Hawkins relief on his counterclaims. We sustain one issue and apply

a settlement credit to reduce the damages award. We otherwise overrule Hawkins’s issues and

affirm the trial court’s judgment.

1
 Retired Fourth Court of Appeals Chief Justice Sandee Bryan Marion sitting by assignment. See TEX. GOV’T CODE
ANN. § 74.003.
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                                                 BACKGROUND

A. Factual Background 2

         In 2013, Horton sold Hawkins an equipment rental business, General Rental Center

(“GRC”), in Ingram, Texas for $875,000. Hawkins paid $150,000 as a down payment, and Horton

financed the remainder. As part of the financing, Hawkins and Horton entered into a promissory

note, which consisted of a printed form with terms handwritten into designated spaces and a

handwritten exhibit stating collateral. The original note specified a ten-year repayment term.

Several months after execution of the promissory note, Hawkins Ward Enterprises, LLC (“HWE”)

was formed as a limited liability company in the State of Texas. Its initial members were Hawkins

and his then-partner Courtney Ward. After HWE was formed, Horton transferred the real estate

upon which GRC operated to HWE. On February 10, 2014, Horton and Hawkins entered into a

restructuring of the promissory note.               The restructuring agreement consisted of a single

handwritten page signed by both Hawkins and Horton.

       According to Hawkins’s testimony, on December 19, 2014, the parties entered into a release

agreement, pursuant to which Horton released Hawkins from liability arising under the original

promissory note in exchange for $150,000. A copy of the purported release was admitted into

evidence. Horton contested any release in his testimony, contending that his signature on the

release agreement was a forgery. A handwriting expert Horton called also testified that, in her

opinion, the signature was a forgery. According to Horton, instead of a release, on December 20,

2014, the parties entered into a second restructuring of the promissory note.

       Admitted into evidence was a note dated December 20, 2014. The note consists of a single

handwritten page signed by Hawkins and Horton. Hawkins affirmed in his trial testimony that the

2
 We state undisputed facts without attributing their evidentiary sources. With disputed facts, we note the dispute and
describe the contested evidence either in this section or with our discussion.

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signature on the note is his. The December 20, 2014 note states: “Horton agreed to reduce second

note dated 2/10/14.” 3 The note reflects the application of a $150,000 payment and a note balance

of $400,000. Further, the note states a balance reduction of $50,000 for “Lake property trade.”

The December 20, 2014 note provides: “Terms: $350,000.00 @ 3.5% interest, 15 years, balloon

in 5 years.” Additionally, the note states under the heading “Security:”

       Hawkins agrees to the following security for note:

       In the event that Hawkins sales [sic], trade [sic] or in any way transfer [sic] the
       ownership of General Rental, Hawkins must first pay the balance of this note in full
       to Horton or Horton’s assignee. Horton keeps remainder of $50,000.00 credit at
       General Rental from original note.

On the back of the December 20, 2014 note is an indorsement: “Pay to the order of GEORGE L.

SCHULGEN, JR. and FLORENCE E. SCHULGEN,” and below the indorsement is Horton’s

signature. Also in the record is a promissory note Horton made in favor of George and Florence

Schulgen in 2016. The Schulgen promissory note is secured by the December 20, 2014 note

between Hawkins and Horton.

        Around the end of 2016, Hawkins stopped making payments on the December 20, 2014

note. Hawkins testified that, at the time he stopped making payments, any debt he owed had been

released pursuant to a deal he and Horton had made to share profits from the partition and sale of

ranchland. Horton denied any such release in his testimony.

B. Procedural Background

        In May 2020, Horton filed suit against Hawkins and HWE for breach of contract and

quantum meruit. Horton alleged that Hawkins owed $352,837 on the December 20, 2014 note.

Horton sought a judgment for the unpaid amount and a right to foreclose on Hawkins’s ownership

3
  Most, but not all, of the words in the note begin with capital letters. We have standardized capitalization for
readability.

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of HWE and HWE’s assets. In December 2020, Ward entered into an agreement with Hawkins

and HWE, pursuant to which she purchased Hawkins’s equity in HWE and became HWE’s sole

owner. In December 2020, Horton, Ward, and HWE settled. Pursuant to the settlement agreement,

HWE paid Horton $25,000.

        Horton filed a motion for leave to file verified denials on the day of trial, February 14,

2022. 4 By this motion, Horton requested leave to file a verified denial as to execution of the

December 19, 2014 release and any purported partnership between Hawkins and Horton. On the

morning of trial, the trial court considered Horton’s motion for leave. After hearing argument, the

trial court took the issue under advisement. It never explicitly ruled on the motion then or later.

Next, the trial court considered Hawkins’s motion to reconsider an earlier summary judgment

ruling. Hawkins’s counsel argued that Horton’s indorsement of the December 20, 2014 note to

the Schulgens and his action to give up physical possession of the note to the Schulgens’s attorney

prohibited Horton from enforcing the note as a “holder,” as that term is used in the Uniform

Commercial Code (“UCC”), or otherwise. See TEX. BUS. & COMM. CODE ANN. §§ 1.201(b)(21),

3.301. The trial court took the matter under advisement.

        At the bench trial, Horton, Hawkins, Ward, the Schulgens’s attorney, and Horton’s

handwriting expert testified. Counsel for both parties also testified regarding attorney’s fees;

however, the trial court prohibited Hawkins from calling Horton’s attorney to testify regarding the

filing of a purportedly fraudulent lien. At the conclusion of trial, the trial court ruled in favor of

Horton. It then signed a final judgment and findings of fact and conclusions of law. The findings

of fact and conclusions of law specify that Horton established a right to enforce the December 20,

4
  Horton served the motion on the Saturday before trial, and the document was filed when the trial court opened on
the following Monday.

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                                                                                      04-22-00307-CV

2014 note and that Horton established the elements of a breach of contract claim. Hawkins timely

appealed.

                                             DISCUSSION

       Some of Hawkins’s issues and sub-issues are duplicative. To simplify matters, we address

the appeal first as to Horton’s claims, considering all arguments Hawkins has presented as to those

claims. Hawkins contends that the trial court’s judgment must be reversed because Horton cannot

enforce the December 20, 2014 promissory note as a matter of law after he indorsed the note and

gave up possession. Hawkins also contends that Horton released the debt through the December

19, 2014 release agreement, that Horton released his claims against Hawkins through Horton’s

settlement with Ward and HWE, and that Horton released any debt owed through the parties’

purported partnership to sell ranchland. As to the releases, Hawkins contends that Horton cannot

deny his execution of the December 19, 2014 release agreement and the purported partnership

because there are no verified denials in the pleadings. The trial court did not explicitly rule on

Horton’s motion for leave to file verified denials, and, even if it had, Hawkins argues, the trial

court abused its discretion by granting leave to file the verified denials so close to trial. Hawkins

also argues that the trial court abused its discretion by allowing testimony from Horton’s

handwriting expert. Hawkins argues that, if we reverse the damages judgment, we should render

a take-nothing judgment because Horton cannot establish his quantum meruit claim. In addition,

Hawkins contends the amount of damages is unsupported by legally sufficient evidence and that

the trial court erred by refusing to apply a settlement credit.

       We overrule all of Hawkins’s issues directed at the breach of contract claim, any purported

releases, and any subsidiary pleading and evidentiary matters. We sustain only Hawkins’s issue

regarding the settlement credit, and reduce the damages award by $25,000, which represents the

settlement amount between Hawkins and HWE. We do not reach Hawkins’s issue regarding

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                                                                                     04-22-00307-CV

Horton’s alternative quantum meruit claim because the judgement, as modified, is supported based

on the breach of contract claim. See TEX. R. APP. P. 47.1.

       Next, we consider Hawkins’s issue concerning his counterclaims. Hawkins argues the trial

court abused its discretion by excluding testimony from Horton’s counsel related to a purportedly

fraudulent lien.   Hawkins contends that without this testimony he could not establish his

counterclaim. We overrule this issue.

       Last, we consider and reject Hawkins’s issue, in which he contends the attorney’s fees

award to Horton is unsupported by legally sufficient evidence.

A. Horton’s Claim for Breach of Contract

       1. Horton’s Authority to Enforce the December 20, 2014 Promissory Note

       Horton sued to enforce the December 20, 2014 promissory note. Hawkins complains the

trial court abused its discretion by awarding damages to Horton after Horton indorsed the note to

the Schulgens and gave up possession.        Horton’s indorsement and lack of possession are

undisputed. It also is undisputed that Horton pledged the December 20, 2014 note as security to

the Schulgens and that Horton was not in default on his own note with the Schulgens. Based on

this undisputed evidence, the trial court made a finding of fact that Horton had established a right

to enforce the December 20, 2014 note. On appeal, Hawkins contends Horton lacked authority to

enforce the note because Chapter 3 of the UCC precludes his enforcement.

       We construe Hawkins’s argument as a challenge to the trial court’s determination that

Horton had the authority to enforce the December 20, 2014 note. Although the trial court

designated this determination as a finding of fact, it is instead a conclusion of law based on the

undisputed evidence. See Ray v. Farmers’ State Bank of Hart, 576 S.W.2d 607, 608 n.1 (Tex.

1979) (trial court’s designation of determination as finding of fact or conclusion of law is not

controlling on appeal); cf. FFP Mktg. Co. v. Long Lane Master Tr. IV, 169 S.W.3d 402, 407 (Tex.

                                                -6-
                                                                                      04-22-00307-CV

App.—Fort Worth 2005, no pet.) (“The negotiability of an instrument is a question of law.”).

Consequently, we review Hawkins’s issues as a challenge to the trial court’s legal conclusion that

Horton had the authority to enforce the December 20, 2014 note.

       We review a trial court’s conclusions of law de novo to determine if the trial court drew

the correct legal conclusions from the facts. BMC Software Belg., N.V. v. Marchand, 83 S.W.3d

789, 794 (Tex. 2002). We uphold legal conclusions if the trial court’s judgment can be sustained

on any legal theory supported by the evidence. See id.

       The parties both look to the UCC for their arguments on enforceability. Chapter 3 of the

UCC concerns negotiable instruments, and Chapter 9 concerns secured transactions. See TEX.

BUS. & COMM. CODE ANN. §§ 3.101–3.605, 9.101–9.809. Hawkins contends: “Promissory notes

are governed as negotiable instruments under [Chapter 3 of the UCC].” From there, he argues that

specific provisions of Chapter 3 limit who may enforce a note to, generally, a “holder” of the note

or one in possession of the note. See id. §§ 1.201(b)(21), 3.103(d), 3.301. Horton does not address

Hawkins’s arguments as to Chapter 3; instead, Horton cites to Chapter 9 to argue that only he had

the right to enforce the note because the Schulgens’s right would arise only in the event of a default

by Horton on his note with the Schulgens, which had not occurred. See id. §§ 9.202, 9.601,

9.607(a).

       Although Hawkins looks to Chapter 3 for resolution of who has a right to enforce the

December 20, 2014 note, we look to Chapter 3 only to determine that it does not apply. Chapter

3 applies to “negotiable instruments.” See id. § 3.102(a). However, contrary to what Hawkins

asserts, not all promissory notes are “negotiable instruments.” See id. § 3.104(a), (e); Mauricio v.

Mendez, 723 S.W.2d 296, 298 (Tex. App.—San Antonio 1987, no writ) (“It is possible to have a

non-negotiable note.”). Section 3.104 provides:

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                                                                                                  04-22-00307-CV

        (a) Except as provided in Subsections (c) and (d),[ 5] “negotiable instrument” means
        an unconditional promise or order to pay a fixed amount of money, with or without
        interest or other charges described in the promise or order, if it:

                 (1) is payable to bearer or to order at the time it is issued or first comes into
                 possession of a holder;

                 (2) is payable on demand or at a definite time; and

                 (3) does not state any other undertaking or instruction by the person
                 promising or ordering payment to do any act in addition to the payment of
                 money, but the promise or order may contain:

                          (A) an undertaking or power to give, maintain, or protect collateral
                          to secure payment;

                          (B) an authorization or power to the holder to confess judgment or
                          realize on or dispose of collateral; or

                          (C) a waiver of the benefit of any law intended for the advantage or
                          protection of an obligor.

TEX. BUS. & COMM. CODE ANN. § 3.104(a).

        The December 20, 2014 note is not a negotiable instrument, as that term is defined because

it is not “payable to bearer or to order” of Horton. Id. § 3.104(a)(1). 6 Except for checks, to be

negotiable, an instrument must contain words of negotiability. See TEX. BUS. & COM. CODE

§ 3.104(a)(1), (c). Specifically, an instrument must be “payable to bearer or to order at the time it

is issued or first comes into possession of a holder.” Id. § 3.104(a)(1); see also id. § 3.109. As

comment 2 explains:

         Total exclusion from Article 3 of other promises or orders that are not payable to
         bearer or to order serves a useful purpose. It provides a simple device to clearly
         exclude a writing that does not fit the pattern of typical negotiable instruments and
         which is not intended to be a negotiable instrument. If a writing could be an
         instrument despite the absence of “to order” or “to bearer” language and a dispute
         arises with respect to the writing, it might be argued that the writing is a negotiable
         instrument because the other requirements of subsection (a) are somehow met.

5
 Subsections (c) and (d) are not relevant here.
6
 Because the note is not “payable to bearer or to order” we do not also consider whether the note states additional
undertakings not allowed in a negotiable instrument. See TEX. BUS. & COMM. CODE ANN. § 3.104(a)(3).

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                                                                                                   04-22-00307-CV

          Even if the argument is eventually found to be without merit it can be used as a
          litigation ploy. Words making a promise or order payable to bearer or to order are
          the most distinguishing feature of a negotiable instrument and such words are
          frequently referred to as “words of negotiability.” Article 3 is not meant to apply
          to contracts for the sale of goods or services or the sale or lease of real property or
          similar writings that may contain a promise to pay money. The use of words of
          negotiability in such contracts would be an aberration. Absence of the words
          precludes any argument that such contracts might be negotiable instruments.

Id. § 3.014 cmt. 2.

         Because the December 20, 2014 note is not a negotiable instrument, Chapter 3 does not

apply. See id. § 3.102(a); see, e.g., Amplify Fed. Credit Union v. Garcia, No. 03-17-00161-CV,

2017 WL 6757001, at *3 (Tex. App.—Austin Dec. 19, 2017, no pet.) (mem. op.) (holding

installment sales contract was not negotiable instrument subject to Chapter 3 because contract did

not include words of negotiability); Great N. Energy, Inc. v. Circle Ridge Prod., Inc., 528 S.W.3d

644, 662 (Tex. App.—Texarkana 2017, pet. denied) (same as to promissory note); Mauricio, 723

S.W.2d at 298 (same as to promissory note). 7

         Therefore, we overrule Hawkins’s issue as to Chapter 3 of the UCC. Because Chapter 3

does not apply, contract law governs. See Eoff v. Cent. Mut. Ins. Co., 461 S.W.3d 648, 658 (Tex.

App.—Dallas 2015, no pet.), judgment set aside, opinion not vacated (Apr. 23, 2015) (“Between

the original parties, a promissory note that has not been negotiated is treated as a simple contract

governed by the fundamental rules applicable to contract law.”); see also Great N. Energy, 528

7
  To be sure, the December 20, 2014 note can be assigned. See, e.g., Tex. Bank & Tr. Co. v. Spur Sec. Bank, 705
S.W.2d 349, 352 (Tex. App.—Amarillo 1986, no writ) (explaining assignee of non-negotiable certificate of deposit
took certificate subject to any defenses and equities that could be made against it); Gen. Motors Acceptance Corp. v.
Matson, 336 S.W.2d 628, 630 (Tex. App.—Austin 1960, no writ) (same as to retail installment contract); cf. FFP
Mktg. Co., 169 S.W.3d at 409 (explaining indorsement of a non-negotiable promissory note does not create a
presumption of ownership in transferee). However, an assignee of a non-negotiable instrument cannot be a Chapter
3 “holder in due course,” and, generally, must take the non-negotiable instrument subject to any claims and defenses.
See TEX. BUS. & COMM. CODE ANN. § 3.306; Leavings v. Mills, 175 S.W.3d 301, 311 (Tex. App.—Houston [1st Dist.]
2004, no pet.).

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S.W.3d at 661–62. Hawkins does not argue any reason why contract law would preclude Horton’s

enforcement of the December 20, 2014 note, other than release, which we discuss next.

        2. Purported December 19, 2014 Release and Purported Release through a Ranch Deal

        Hawkins contends the trial court erred by failing to enforce the December 19, 2014 release

and a release pursuant to a ranch deal. Hawkins argues that Horton was precluded from contesting

the releases by failing to timely file verified denials and that the trial court abused its discretion by

allowing a handwriting expert to opine that a signature on the December 19, 2014 release was not

Horton’s.

                A. Procedural Background

        Hawkins alleged the validity of the December 19, 2014 release beginning with his original

counter petition, and he asserted a partnership with Horton related to a ranch deal for the first time

in his second amended counter petition, filed a week before trial. On the day of trial, Horton filed

a motion for leave to file a verified answer to Hawkins’s second amended counter petition. In the

verified answer, Horton denied signing the December 19, 2014 release, and he denied any

purported partnership with Horton.

        Before trial began, Hawkins’s counsel objected to Horton’s motion for leave. Hawkins’s

counsel argued that the “signature-related defense” was a completely different defensive strategy

that he was previously unaware of. He further argued that he was unable to schedule his expert to

inspect “the document at issue in this case” the week before trial and that “because [Horton] had

not pled any signature-related defenses, [Hawkins’s counsel] assumed [his] expert wasn’t needed.”

        Hawkins’s counsel also argued that the disclosure of Horton’s handwriting expert, Wendy

Carlson, was deficient. The disclosure provides:

        Ms. Carlson will testify as to the review and forensic analysis of the subject
        December 2014 handwritten promissory note between the parties to determine

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       whether or not any language was added or removed after the parties’ executed the
       note and as a potential rebuttal expert for any experts designated by any other party.

According to Hawkins’s counsel: “[The] expert witness designation does not mention signatures

a single time, not once. And it only mentions a single document, . . . which is not the document

that [Horton claims he] didn’t sign.” Hawkins’s counsel requested a continuance to depose

Horton’s expert and to prepare a rebuttal expert if the trial court granted Horton’s motion for leave.

The trial court took the matter under advisement, but it never expressly ruled on the motion.

       On appeal, Hawkins argues that Horton’s answer to his counter petition does not include

verified denials because the trial court never expressly granted leave for Horton to file his verified

answer. Consequently, Hawkins argues, the validity of the December 19, 2014 release agreement

and the existence of the alleged partnership cannot be denied, and the releases must be given effect.

Hawkins also argues that, even if the trial court had granted leave to file the verified answer, it

abused its discretion. Hawkins argues as to Carlson that the trial court abused its discretion by

allowing her testimony because Horton’s disclosure was deficient. We consider first the pleading

amendment and then the expert disclosure.

               B. Pleading Amendment

       A denial of the execution of a written instrument and a denial of a partnerships must be

raised by verified pleadings. TEX. R. CIV. P. 93(5), (7). Without a verified denial, a written

instrument is received into evidence as fully proved, and a partnership’s existence cannot be

controverted at trial. See id. R. 93(7); GR Fab’n, LLC v. Swan, No. 02-19-00242-CV, 2020 WL

2202325, at *3 n.3 (Tex. App.—Fort Worth May 7, 2020, no pet.) (mem. op.).

       Texas Rule of Civil Procedure 63 allows a party to amend its pleading within seven days

of trial with leave, “which leave shall be granted by the judge unless there is a showing that such

filing will operate as a surprise to the opposite party.” TEX. R. CIV. P. 63. Courts liberally

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interpretate Rule 63. Goswami v. Metro. Sav. & Loan Ass’n, 751 S.W.2d 487, 490 (Tex. 1988).

“[I]n the absence of a sufficient showing of surprise by the opposing party, the failure to obtain

leave of court when filing a late pleading may be cured by the trial court’s action in considering

the amended pleading.” Id. We must presume the trial court granted leave when: “(1) the record

fails to show that the trial court did not consider the amended pleading, and (2) there is not a

sufficient showing of surprise or prejudice on the part of the opposing party.” Wilson v. Korthauer,

21 S.W.3d 573, 578 (Tex. App.—Houston [14th Dist.] 2000, pet. denied) (citing Goswami, 751

S.W.2d at 490); see also B.C. v. Steak N Shake Opr’ns, Inc., 598 S.W.3d 256, 262 n.29 (Tex.

2020). Furthermore, a trial court has no discretion to refuse an amendment unless (1) the opposing

party presents evidence of surprise or prejudice or (2) the amendment asserts a new cause of action

or defense, and thus is prejudicial on its face, and the opposing party objects to the amendment.

State Bar of Tex. v. Kilpatrick, 874 S.W.2d 656, 658 (Tex. 1994); Knorpp v. CIT Group/Consumer

Fin., Inc., No. 07-19-00177-CV, 2020 WL 4459130, at *2 (Tex. App.—Amarillo Aug. 3, 2020,

no pet.) (mem. op.). The party opposing amendment bears the burden to show prejudice or

surprise. Mosaic Baybrook One, L.P. v. Cessor, 668 S.W.3d 611, 626 (Tex. 2023). “A trial court’s

decision on whether to allow the amendment of pleadings is reviewed under an abuse-of-discretion

standard.” Perez v. Embree Constr. Grp., 228 S.W.3d 875, 882–83 (Tex. App.—Austin 2007, pet.

denied).

       There is nothing in the record to indicate that the trial court did not consider Horton’s

amended pleading. See Goswami, 751 S.W.2d at 490; Korthauer, 21 S.W.3d at 578. Moreover,

the trial court’s findings of facts indicate that it considered Horton’s verified denials because a

finding states that Horton established he did not agree to release Hawkins from any obligations

owed. Therefore, whether we may presume leave was granted and whether the trial court acted

within its discretion by granting leave to file the amended answer with verified denials turns on

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whether Hawkins has established surprise. See Kilpatrick, 874 S.W.2d at 658; Mosaic Baybrook

One, 668 S.W.3d at 626; Goswami, 751 S.W.2d at 490; Korthauer, 21 S.W.3d at 578.

        We hold that Hawkins has not made a sufficient showing of surprise to defeat the

presumption of leave and to establish abuse of discretion because he has not presented evidence

of surprise, and the pleading amendment is not prejudicial on its face. See Kilpatrick, 874 S.W.2d

at 658. Hawkins’s counsel presented only argument at the pretrial hearing on the motion for leave.

As to facial prejudice, the standard is that an amendment is prejudicial on its face if it: “(1) asserts

a new substantive matter which reshapes the nature of the trial; (2) is of such a nature that it could

not have been anticipated in light of the development of the case up until the time of amendment;

and (3) would detrimentally affect the opposing party’s presentation of its case.” 1776 Energy

Partners, LLC v. Marathon Oil EF, LLC, No. 04-20-00304-CV, 2023 WL 2669669, at *12 (Tex.

App.—San Antonio Mar. 29, 2023, no pet.) (quoting Tex. Black Iron, Inc. v. Arawak Energy Int’l

Ltd., 566 S.W.3d 801, 827 (Tex. App.—Houston [14th Dist.] 2018, pet. denied)).

        Here, the record shows that Horton’s amendment could have been anticipated in light of

the development of the case up until the time of amendment; therefore, it was not prejudicial on

its face. See id. First, by his claims, Horton sought recovery of an allegedly unpaid debt. His

claims logically implied rejection of Hawkins’s contention, asserted in counterclaims, that Horton

had released the debt. Second, Horton contested any release by his discovery responses, deposition

testimony, and summary-judgment briefing. As to the purported December 19, 2014 release, in

his summary-judgment response, Horton “vigorously dispute[d] the validity and authenticity of

his signature on that document.” Cf. Lemon v. Hagood, 545 S.W.3d 105, 119–20 (Tex. App.—El

Paso 2017, pet. denied) (“We fail to find any surprise here. The motion for summary judgment

and response fleshed out the arguments of the parties well in advance of trial.”). Third, Hawkins

designated an expert, whose expected testimony he described as “regarding the documents at issue

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in this case, including but not limited to the authenticity of signatures and alterations of any

documents.” On this record, we cannot say that Hawkins has established surprise due to the

amendment. See Mosaic Baybrook One, 668 S.W.3d at 626.

                  C. Testimony of Horton’s Handwriting Expert

          Hawkins also contends that Horton’s disclosure of his handwriting expert, Carlson, was

deficient and that the trial court abused its discretion by allowing her testimony. Carlson testified

as to her opinion that the disputed signature on the December 19, 2014 release was not Horton’s.

          The Texas Rules of Civil Procedure require disclosure of “the general substance of [a

testifying] expert’s mental impressions and opinions and a brief summary of the basis for them.”

TEX. R. CIV. P. 194.2(f). 8 Testimony may be excluded as a sanction under Rule 193.6 for failure

to comply with Rule 194.2(f). See id. R. 193.6; Mares v. Ford Motor Co., 53 S.W.3d 416, 418

(Tex. App.—San Antonio 2001, no pet.).

          To obtain reversal of a judgment based on error in the admission or exclusion of evidence,

an appellant must show that the trial court’s ruling was erroneous and that the error probably

resulted in an improper judgment. TEX. R. APP. P. 44.1; City of Brownsville v. Alvarado, 897

S.W.2d 750, 753 (Tex. 1995). “A successful challenge to evidentiary rulings usually requires the

complaining party to show that the judgment turns on the particular evidence excluded or

admitted.” Alvarado, 897 S.W.2d at 753–54; see also Nissan Motor Co. v. Armstrong, 145 S.W.3d

131, 144 (Tex. 2004) (“Clearly, erroneous admission [of evidence] is harmless if it is merely

cumulative.”). To make this determination, we review the entire record. Alvarado, 897 S.W.2d

at 754.

8
 Because former Rule 194.2 was in effect when this case was filed, we cite to that former rule. Provisions regarding
expert disclosures are now found in Rule 195.5, which applies to cases filed on or after January 1, 2021. TEX. R. CIV.
P. 195.5; Order, Misc. Docket No. 20-9153 (Tex. Dec. 23, 2020); Siana Oil & Gas Co. v. White Oak Opr’g Co., No.
01-21-00721-CV, 2022 WL 17981572, at *8 n.11 (Tex. App.—Houston [1st Dist.] Dec. 29, 2022, no pet.) (mem. op.).

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       Even if we assume the trial court erred by allowing Carlson’s testimony, Hawkins has not

demonstrated that any error probably caused the rendition of an improper judgment. See TEX. R.

APP. P. 44.1(a)(1). Hawkins did not argue harm in his opening brief. In his reply brief he asserts

that, absent Carlson’s testimony, the only evidence to dispute Horton’s signature is Horton’s “self-

serving testimony” that he did not sign the December 19, 2014 release. Generally, a trial court at

a bench trial may accept or reject all or any part of a witness’s testimony. Weisfield v. Tex. Land

Fin. Co., 162 S.W.3d 379, 380 (Tex. App.—Dallas 2005, no pet.). Here, while the trial court was

not required to accept Horton’s testimony as credible, it also was not required to reject it. Likewise,

the trial court was free to believe or disbelieve Hawkins’s testimony that the parties executed the

December 19, 2014 release. As stated in a finding of fact, the trial court determined Hawkins’s

testimony, offered in support of his affirmative defenses and counterclaims, was “not credible.”

See In re Marriage of Slagle, No. 14-16-00113-CV, 2018 WL 2306736, at *6 (Tex. App.—

Houston [14th Dist.] May 22, 2018, pet. denied) (mem. op.) (rejecting husband’s argument trial

court abused discretion when it divided community estate because trial court could have believed

wife’s testimony over husband’s).        Moreover, Hawkins testified that signatures on certain

documents in evidence were his, and, based on this testimony, the trial court could have compared

signatures and determined that the signature on the December 19, 2014 release was not Horton’s.

See, e.g., Nguyen v. Pham, 640 S.W.3d 266, 275 (Tex. App.—Houston [14th Dist.] 2021, pet.

denied); see also, e.g., Morris v. Wells Fargo Bank, N.A., 334 S.W.3d 838, 848 (Tex. App.—

Dallas 2011, no pet.). Additionally, it was undisputed that Hawkins continued making payments

to Horton after December 19, 2014, which is some additional evidence supporting Horton’s

assertion that he did not execute the December 19, 2014 release. In light of this record, we hold

error, if any, in allowing Carlson’s testimony was harmless because Carlson’s testimony was

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                                                                                       04-22-00307-CV

cumulative. See TEX. R. APP. P. 44.1; Armstrong, 145 S.W.3d at 144; see Alvarado, 897 S.W.2d

at 753.

          3. The Purported Release pursuant to the Horton-Ward-HWE Settlement

          We next consider Hawkins’s third contention for release: release pursuant to the Horton-

Ward-HWE settlement agreement. We also reject this contention.

          On December 14, 2020, Hawkins, Ward, and HWE entered into an agreement, pursuant to

which Ward purchased Hawkins’s equity in HWE and became HWE’s sole owner. The agreement

outlined a procedure under which an appraiser would value HWE and Ward would then purchase

Hawkins’s stake at the appraised value. At trial, Ward testified that Horton conveyed HWE’s

business properties to her in June 2021.

          Also on December 14, 2020, Horton settled with Ward and HWE. The Horton-Ward-HWE

settlement agreement defines “parties” to mean “Bobby Horton, Courtney Ward and Hawkins

Ward Enterprises, LLC.” Pursuant to the settlement agreement, HWE paid Horton $25,000, and

the settling parties agreed to release their claims and demands against the other settling parties.

The agreement states that it is not subject to revocation. The settlement agreement also states:

“This mutual release runs to the benefit of all attorneys, agents, employees, officers, directors,

shareholders, partners, heirs, assigns, and legal representatives of the parties hereto.” Additionally,

the Horton-Ward-HWE settlement agreement includes a provision that all funds paid by Ward or

HWE to Hawkins in exchange for his ownership interest in HWE shall be deposited into the

registry of the court. Horton, Ward, and HWE also signed an addendum “[e]xecuted to be effective

December 14, 2020,” which specifically excludes Hawkins from the release.

          On appeal, Hawkins argues that the Horton-Ward-HWE settlement agreement runs to his

benefit because he was still an owner of HWE on December 14, 2020. As Ward testified, the

transfer of HWE’s business property to her did not occur until June 2021. Hawkins argues that,

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                                                                                      04-22-00307-CV

as an owner of HWE on December 14, 2020, he fell within the provision that specified: “This

mutual release runs to the benefit of all attorneys, agents, employees, officers, directors,

shareholders, partners, heirs, assigns, and legal representatives of the parties hereto.” He also

argues the addendum is ineffective because it was not signed by all necessary persons and because

it could not serve to revoke any previously granted release.

       A release agreement is only effective against the parties that are named in the release or

are described in the release with such particularity that the party’s identity is not in doubt.

Memorial Med. Ctr. of E. Tex. v. Keszler, 943 S.W.2d 433, 434 (Tex. 1997) (per curiam) (citing

Duncan v. Cessna Aircraft Co., 665 S.W.2d 414, 420 (Tex. 1984)). “[The] requirement of specific

identification is not met unless the reference in the release is so particular that ‘a stranger could

readily identify the released party.’” Finley Res., Inc. v. Headington Royalty, Inc., No. 21-0509,

2023 WL 3399104, at *5 (Tex. May 12, 2023) (quoting Duncan, 665 S.W.2d at 419–20 (citation

omitted)). Interpretation of an uncontested and unambiguous release is to be decided by the court

as a question of law. Keszler, 943 S.W.2d at 434; Westwind Expl. v. Homestate Sav. Ass’n, 696

S.W.2d 378, 381 (Tex. 1985).

       Even if we do not consider the addendum, we hold that the Horton-Ward-HWE settlement

agreement does not describe Hawkins with such particularity that we can be free of doubt that the

release runs to his benefit. See Keszler, 943 S.W.2d at 434. Instead, the agreement raises doubt

as to whether he is a party to the release. First, he is not defined as a party; Ward, HWE, and

Horton are. Hawkins’s omission as a named party does not appear to be an oversight because the

settlement agreement includes a style of the case, which lists Hawkins as a defendant to Horton’s

lawsuit. Second, the court-registry provision raises doubt about whether Hawkins is included as a

“shareholder,” “partner,” or other person related to Ward or HWE, for whom the benefits of the

release could run. The court-registry provision contemplates payment of funds by Ward or HWE

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to Hawkins in exchange for his ownership of HWE. With such a provision contemplating

termination of Hawkins’s ownership, we cannot say that a term describing “agents, employees,

officers, directors, shareholders, [and] partners” of Ward and HWE identifies Hawkins with such

particularity that we can be free of doubt the release runs to his benefit. Cf. Finley Res., 2023 WL

3399104, at *7–10 (holding person not specifically named, “despite the looming threat of

litigation,” was not among a class of “predecessors” to whose benefit release ran). Therefore, we

conclude the trial court did not err by refusing to extend the settlement’s release of claims and

demands to Hawkins’s benefit.

       4. Legal Sufficiency of the Evidence as to Damages

       Having rejected challenges to Hawkins’s liability for breach of contract, we now consider

whether the $352,837 awarded as contract damages is supported by legally sufficient evidence.

       When reviewing the legal sufficiency of the evidence, we consider the evidence in the light

most favorable to the challenged finding and indulge every reasonable inference that would

support it. City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005). We must credit favorable

evidence if a reasonable fact finder could and disregard contrary evidence unless a reasonable fact

finder could not. See id. at 827. When there is conflicting evidence, it is the province of the fact

finder to resolve such conflicts, and we must presume the fact finder resolved conflicting evidence

in favor of the prevailing party. Id. at 820–21. To sustain a challenge to the legal sufficiency of

the evidence supporting a finding, the reviewing court must find that: (1) there is a complete lack

of evidence of a vital fact; (2) the court is barred by rules of law or evidence from giving weight

to the only evidence offered to prove a vital fact; (3) there is no more than a mere scintilla of

evidence to prove a vital fact; or (4) the evidence conclusively established the opposite of a vital

fact. Volkswagen of Am., Inc. v. Ramirez, 159 S.W.3d 897, 903 (Tex. 2004). “If there is more

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                                                                                                   04-22-00307-CV

than a scintilla of evidence to support the judgment, we must uphold it.” Vast Constr., LLC v.

CTC Cont’rs, LLC, 526 S.W.3d 709, 719 (Tex. App.—Houston [14th Dist.] 2017, no pet.).

        The trial court found that the “current amount owed to Horton” was $352,837. Hawkins

argues, on appeal, that Horton’s admission at trial that he kept no records conclusively establishes

Horton did not know the certain sum due on the note. 9 Having reviewed the trial record, we hold

there is more than a scintilla of evidence to support the finding as to contract damages. Horton

testified that Hawkins: (1) started making payments on the December 20, 2014 note in January

2015; (2) he paid “$2,500 and change a month”; (2) he made “probably 98 percent of [payments]

in cash”; (4) he “never missed a month during all of that time”; and he paid through November

2016. Hawkins testified that he paid in cash, and he did not know exactly when he stopped making

payments. Also included in the record are: (1) a text message, dated December 14, 2019, from

Horton to Hawkins which states: “If you do not your [sic] payment due on 12/20/19, we will

foreclose on General Rental. The balance due on your note is $352,837.00 including interest.”;

(2) a pre-litigation demand letter from Horton’s counsel to Hawkins, stating $352,837 as the

“current amount due”; and (3) a calculation reflecting a total amount due on December 20, 2019,

of $352,837. This calculation purports to apply twenty-two payments of $2,502.07, which is the

monthly payment amount stated in the December 20, 2014 note, and to add interest to the

outstanding principal, based on a 3.5% interest rate, which is the interest rate stated in the note.

Cf. Gen. Growth Props., Inc. v. Prop. Tax Mgmt., Inc., 614 S.W.3d 386, 396 (Tex. App.—Houston

[14th Dist.] 2020, no pet.) (“Because each of these invoices contain complete calculations applying

the formula to which the parties agreed to the results actually obtained, they are legally and

9
 Hawkins does not cite to any authority for the proposition that a failure to keep contemporaneous records of payment
conclusively establishes that the amount of a debt cannot be known.

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factually sufficient to support damage awards [in specific amounts].”). We overrule Hawkins’s

legal sufficiency challenge as to the amount of damages. 10

         5. Settlement Credit

         Nevertheless, we reduce the damages award by $25,000 because the trial court failed to

apply a settlement credit when Hawkins pled for such a credit based on the Horton-Ward-HWE

settlement.

         Texas Civil Practice and Remedies Code section 33.012(b) requires that a court “reduce

the amount of damages to be recovered by the claimant with respect to a cause of action by the

sum of the dollar amounts of all settlements.” To obtain a settlement credit, “the record [need

only] show, in the settlement agreement or otherwise, the settlement credit amount.” Utts v. Short,

81 S.W.3d 822, 828 (Tex. 2002). “Once the nonsettling defendant demonstrates a right to a

settlement credit, the burden shifts to the plaintiff to show that certain amounts should not be

credited because of the settlement agreement’s allocation.” Id. Specifically, “[t]he plaintiff can

rebut the presumption . . . by presenting evidence showing that the settlement proceeds are

allocated among defendants, injuries, or damages such that entering judgment on the [fact finder’s]

award would not provide for the plaintiff’s double recovery.” Sky View at Las Palmas, LLC v.

Mendez, 555 S.W.3d 101, 107–08 (Tex. 2018). “If there is no allocation, the settlement is

presumed to have satisfied liability common among the parties.” LuxeYard, Inc. v. Klinek, 643

S.W.3d 260, 265 (Tex. App.—Houston [14th Dist.] 2022, no pet.) (citing Mobil Oil Corp. v.

Ellender, 968 S.W.2d 917, 928 (Tex. 1998)).

10
  To the extent Hawkins argues that establishment of a certain sum due is an element of a breach of contract claim,
for which there was not legally sufficient evidence in the record, we reject Hawkins’s argument because there is legally
sufficient evidence of the amount the trial court determined was due, which is the amount it awarded as damages.

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       Here, application of the settlement credit is straightforward. Horton asserted the same

breach of contract and quantum meruit causes of action against both Hawkins and HWE. Horton

then settled with HWE for $25,000; the settlement agreement was admitted at trial; and Horton

did not attempt to allocate the settlement amount among defendants or otherwise. Therefore, the

settlement amount should have been credited to reduce the amount of damages. See TEX. CIV.

PRAC. & REM. CODE ANN. § 33.012(b); Utts, 81 S.W.3d at 828; see also Dalworth Restoration,

Inc. v. Rife-Marshall, 433 S.W.3d 773, 782 (Tex. App.—Fort Worth 2014, pet. dism’d w.o.j.)

(holding trial court abused its discretion by refusing to apply settlement credit and rendering take-

nothing judgment where credited amount exceeded damages awarded).

       On appeal, Horton does not contest that a settlement credit should be applied. Instead, he

argues the trial court applied the credit when it reduced the attorney’s fees award. The record does

not bear out Horton’s assertion.      At trial, Horton’s attorney testified that Horton incurred

$147,576.75 in attorney’s fees, with approximately fifteen percent of this amount incurred “with

respect to specifically the claims in the settlement” with Ward and HWE. Upon conclusion of

trial, the trial court stated that Horton was entitled to recover attorney’s fees, and it explained the

amount it would award:

       I’ve reduced the attorney’s fees by 15 percent, thereby removing approximately the
       amount of time and expense spent on [Horton’s counsel’s] dealing with [HWE] to
       the settlement of that matter. Therefore, the attorney’s fees in the amount of
       $147,576, rounded, reduced by 15 percent, goes to [$]125,441.

The final judgment awards $125,441 in attorney’s fees for prosecution of the case through

judgment. A finding of fact states Hawkins failed to prove “his affirmative defense that Horton’s

claims were entitled to offset by a settlement credit for . . . $25,000 paid by [HWE] in December

2020.” Another finding of fact states:

       Horton incurred reasonable and necessary attorney’s fees in the amount of
       $167,576.75 [sic], of which, after all credits for payments received previously by

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                                                                                          04-22-00307-CV

        Horton, and was reduced for time spent on matters involving Hawkins Ward
        Enterprises, LLC, supports an award of attorneys’ fees in the amount of
        $125,441.00 in favor [of] Horton for the prosecution of his breach of contract claim
        against Hawkins.

        This record shows the trial court reduced attorney’s fees by the amount it determined could

be segregated and attributed to work incurred related to claims against HWE. The record does not

reflect that the trial court applied a settlement credit to “reduce the amount of damages,” as

required by section 33.012(b) of the Texas Civil Practice and Remedies Code. Therefore, we

amend the judgment to reduce the damages award by the amount of the Horton-Ward-HWE

settlement. Actual damages are reduced from $352,837 to $327,837.

2. Exclusion of Testimony related to Hawkins’s Claims

        In a single issue concerning his counterclaims, Hawkins contends the trial court abused its

discretion by striking Horton’s counsel as a fact witness. See In re J.P.B., 180 S.W.3d 570, 575

(Tex. 2005) (“We review a trial court’s decision to admit or exclude evidence for an abuse of

discretion.”); see also Van Heerden v. Van Heerden, 321 S.W.3d 869, 877, 79 (Tex. App.—

Houston [14th Dist.] 2010, no pet.) (holding trial court abused its discretion by striking fact

witness). Hawkins argues on appeal:

        Hawkins brought claims against Horton based on a fraudulently filed a [sic] UCC-
        1 financing statement against covering [sic] property superseded by the December
        20, 2014 note at issue in this case. . . . That financing statement was filed by
        [Horton’s counsel] on Horton’s behalf. . . . Since [Horton’s counsel’s] services
        were sought to enable the collection on a superseded security interest, his testimony
        meets the requirements of Rule 503[ of the Texas Rules of Evidence].

        “Texas Rule of Evidence 503(b)(1) provides for privileged communications between

clients and their attorneys.” In re AEP Tex. Cent. Co., 128 S.W.3d 687, 691 (Tex. App.—San

Antonio 2003, no pet.). “A client has a privilege to refuse to disclose and to prevent any other

person from disclosing confidential communications made to facilitate the rendition of

professional legal services to the client: . . . between the client . . . and the client’s lawyer[.]” TEX.

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                                                                                       04-22-00307-CV

R. EVID. 503(b)(1). However, no attorney-client privilege exists if the “crime/fraud” exception in

Rule 503 applies. Id. R. 503(d)(1). The exception applies “[i]f the lawyer’s services were sought

or obtained to enable or aid anyone to commit or plan to commit what the client knew or reasonably

should have known to be a crime or fraud.” Id.

       While the burden of proving a privilege is on the party asserting the privilege, the burden

of establishing the crime/fraud exception is on the party asserting the exception. In re AEP Tex.

Cent., 128 S.W.3d at 692; Volcanic Gardens Mgmt. Co., Inc. v. Paxson, 847 S.W.2d 343, 347

(Tex. App.—El Paso 1993, no writ). “A party who asserts the crime/fraud exception must show:

(1) a prima facie case of the contemplated crime or fraud; and (2) a nexus between the

communications at issue and the crime or fraud.” In re USA Waste Mgmt. Res., L.L.C., 387 S.W.3d

92, 98 (Tex. App.—Houston [14th Dist.] 2012, orig. proceeding [mand. denied]) (citing Granada

Corp. v. Hon. First Ct. App., 844 S.W.2d 223, 227 (Tex. 1992)). “Mere allegations of fraud are

insufficient.” Id. “A prima facie showing is sufficient if it sets forth evidence that, if believed by

a trier of fact, would establish the elements of a fraud or crime that was ongoing or about to be

committed . . . .” In re Gen. Agents Ins. Co. of Am., 224 S.W.3d 806, 819 (Tex. App.—Houston

[14th Dist.] 2007, orig. proceeding) (citation omitted).

       To establish application of the crime/fraud exception, it was Hawkins’s burden to show a

prima facie case of a contemplated crime or fraud. In re USA Waste Mgmt., 387 S.W.3d at 98.

Such a showing would have required Hawkins to set forth evidence and explain how the evidence,

if believed, would establish the elements of a crime or fraud. In re Gen. Agents Ins., 224 S.W.3d

at 819. It also is Hawkins’s burden, on appeal, to show that the trial court’s evidentiary ruling

probably caused the rendition of an improper judgment, which “usually requires the complaining

party to show that the judgment turns on the particular evidence excluded or admitted.” Tex. Dep’t

of Transp. v. Able, 35 S.W.3d 608, 617 (Tex. 2000); see TEX. R. APP. P. 44.1(a). After the trial

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court excluded testimony from Horton’s counsel, Hawkins’s counsel argued, at closing, for

judgment in Hawkins’s favor on his counterclaims based on the documents in evidence. On

appeal, Hawkins does not argue harm. See TEX. R. APP. P. 44.1(a). His appellate brief also does

not provide or discuss the elements as to any crime or fraud or explain how the evidence could

show a prima facie case. See In re Gen. Agents Ins., 224 S.W.3d at 819. Therefore, we overrule

Hawkins’s issue regarding the exclusion of testimony because Hawkins has not established that

excluded testimony from Horton’s counsel, even if erroneously excluded, was controlling on a

material issue dispositive to the case and was not cumulative or that exclusion otherwise probably

caused the rendition of an improper judgment. See TEX. R. APP. P. 44.1(a); Able, 35 S.W.3d at

617; see also Interstate Northborough P’ship v. State, 66 S.W.3d 213, 220 (Tex. 2001)

(“[O]rdinarily, this Court will not reverse a judgment because a trial court erroneously excluded

evidence when the evidence in question is cumulative and not controlling on a material issue

dispositive to the case.”).

3. Attorney’s Fees

        Last, Hawkins argues the evidence supporting the attorney’s fees award is legally

insufficient. Horton did not submit invoices or billing records. Hawkins argues that Horton’s

counsel’s testimony in support of fees is insufficiently detailed. Horton responds that the evidence

is sufficient in light of presumptions allowed in breach-of-contract cases.

        At trial, Horton’s counsel testified as to his, co-counsel’s, and office paralegals’ hourly

rates and his opinion as to the reasonableness of those rates. He also testified that his office spent

a total of 506 hours on the case and that the total amount of fees incurred was $147,576.75.

Horton’s counsel, however, did not provide billing records with details specifying time spent on

discrete tasks by particular individuals. He testified generally as to the experience of lawyers and

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paralegals in his office, the nature of the case, and tasks performed during various stages of the

case.

        Attorney’s fees are not recoverable unless authorized by statute or contract. Tony Gullo

Motors I, L.P. v. Chapa, 212 S.W.3d 299, 310 (Tex. 2006). “When fee-shifting is authorized, the

party seeking to recover those fees bears the burden of establishing the fees are reasonable and

necessary.” In re Nat’l Lloyds Ins. Co., 532 S.W.3d 794, 809 (Tex. 2017). In Rohrmoos Venture

v. UTSW DVA Healthcare, LLP, 578 S.W.3d 469 (Tex. 2019), the Texas Supreme Court

summarized the method used to determine the reasonableness and necessity of attorney’s fees:

        Under the lodestar method, the determination of what constitutes a reasonable
        attorney’s fee involves two steps. First, the [fact finder] must determine the
        reasonable hours spent by counsel in the case and a reasonable hourly rate for such
        work. The [fact finder] then multiplies the number of such hours by the applicable
        rate, the product of which is the base fee or lodestar. The [fact finder] may then
        adjust the base lodestar up or down (apply a multiplier), if relevant factors indicate
        an adjustment is necessary to reach a reasonable fee in the case.

Id. at 501 (quoting El Apple I, Ltd. v. Olivas, 370 S.W.3d 757, 760 (Tex. 2012)). “General,

conclusory testimony devoid of any real substance will not support a fee award.” Id. Sufficient

evidence includes “evidence of (1) particular services performed, (2) who performed those

services, (3) approximately when the services were performed, (4) the reasonable amount of time

required to perform the services, and (5) the reasonable hourly rate for each person performing

such services.” Id. at 502. While the court in Rohrmoos did not require billing records, it stated

they “are strongly encouraged.” Id. Hawkins argues the trial court’s attorney’s fees award

contradicts the basic requirements set forth in Rohrmoos.

        Horton sought attorney’s fees under Texas Civil Practice and Remedies Code section

38.001, which allows a prevailing party in a breach-of-contract case to recover reasonable and

necessary attorney’s fees. See TEX. CIV. PRAC. & REM. CODE ANN. § 38.001. Under Chapter 38,

the trial court “may take judicial notice of the usual and customary attorney’s fees and of the

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                                                                                      04-22-00307-CV

contents of the case file without receiving further evidence” in a proceeding before the court. Id.

§ 38.004. Further, “[i]t is presumed that the usual and customary attorney’s fees for a [breach-of-

contract] claim are reasonable.” Id. § 38.003. “The presumption may be rebutted.” Id.; see Person

v. MC-Simpsonville, SC-1-UT, LLC, No. 03-20-00560-CV, 2021 WL 3816332, at *7 (Tex. App.—

Austin Aug. 27, 2021, no pet.) (mem. op.).

        Because this case was tried to the bench, section 38.004 authorized the trial court to

judicially notice usual and customary attorney’s fees. See TEX. CIV. PRAC. & REM. CODE ANN.

§ 38.004; Beach St. Foods, Inc. v. Grandy’s, LLC, No. 02-20-00135-CV, 2022 WL 187988, at *10

(Tex. App.—Fort Worth Jan. 20, 2022, no pet.). As the supreme court noted in Rohrmoos, Chapter

38 includes noteworthy provisions not typically found in other statutory fee enactments. See

Rohrmoos, 578 S.W.3d at 490 n.9; cf. Logan v. Randall, No. 05-19-00043-CV, 2020 WL 948381,

at *8 (Tex. App.—Dallas Feb. 27, 2020, pet. denied) (“[T]he evidentiary requirements to support

an award of attorney’s fees under chapter 38 are completely different when the issue is presented

to the trial court for determination rather than to a jury.”).

        “In the absence of other evidence supporting an attorney’s fee award[, when allowed under

Chapter 38 in a bench trial], the reviewing court will presume that the trial court took judicial

notice of the usual and customary fees and of the contents of the case file in determining the amount

of attorney’s fees awarded.” Scott Pelley P.C. v. Wynne, 578 S.W.3d 694, 705 (Tex. App.—Dallas

2019, no pet.); see also TEX. CIV. PRAC. & REM. CODE ANN. § 38.005 (specifying liberal

construction of Chapter 38 to promote its underlying purpose). “Judicial notice of the usual and

customary fees constitutes some evidence on which the trial court may base an award.” Scott

Pelley P.C. v. Wynne, 578 S.W.3d at 705.

        On this record and pursuant to Chapter 38, the trial court had legally sufficient evidence on

which to base its award. See TEX. CIV. PRAC. & REM. CODE ANN. § 38.003–.005; Hernandez v.

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Zapata, No. 04-19-00507-CV, 2020 WL 3815932, at *8 (Tex. App.—San Antonio July 8, 2020,

no pet.) (mem. op.) (holding attorney’s fees award supported by legally sufficient evidence in light

of judicial notice taken pursuant to section 38.004); Scott Pelley P.C., 578 S.W.3d at 705 (Tex.

App.—Dallas 2019, no pet.) (concluding evidence legally sufficient to support attorney’s fees

award under Chapter 38 based on presumed judicial notice of contents of case file and usual and

customary attorney’s fees). Here, the trial court found that “Horton incurred reasonable and

necessary attorney’s fees,” and Hawkins did not put on any evidence contesting the reasonableness

of Horton’s attorney’s fees. Additionally, Horton’s counsel testified generally as to the fees

incurred and his opinion that the fees incurred were reasonable. We overrule Hawkins’s issue as

to attorney’s fees.

                                          CONCLUSION

       We modify the trial court’s judgment to reduce actual damages awarded from $352,837 to

$327,837, and we affirm the judgment as modified. See TEX. R. APP. P. 43.2(b).

                                                  Rebeca C. Martinez, Chief Justice

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