Court Opinion

ID: 7806830
Source: CourtListenerOpinion
Date Created: 2022-09-07 07:11:27.152731+00
Date Added: 2024-06-11T16:30:18.642609
License: Public Domain

REVERSE and REMAND and Opinion Filed August 31, 2022

                                    S  In The
                             Court of Appeals
                      Fifth District of Texas at Dallas
                                No. 05-20-00379-CV

             NEWSOM, TERRY & NEWSOM, LLP, AND
                   STEVEN K. TERRY, Appellants
                               V.
         HENRY S. MILLER COMMERCIAL COMPANY, Appellee

               On Appeal from the 134th Judicial District Court
                            Dallas County, Texas
                   Trial Court Cause No. DC-09-01306-G

                        MEMORANDUM OPINION
                   Before Justices Reichek, Nowell, and Carlyle
                           Opinion by Justice Reichek
      This is the second appeal following a jury trial in this suit for legal

malpractice. Newsom, Terry & Newsom, LLP and Steven K. Terry (collectively

“Terry”) challenge the trial court’s judgment in favor of Henry S. Miller Commercial

Company (“HSM”) on the basis that, (1) the evidence is legally and factually

insufficient to support the jury’s findings on breach of the standard of care,

proximate cause, gross negligence, and damages, (2) the trial court erred in refusing

to submit a jury charge question on the fault and proportionate responsibility of third

parties, (3) the court’s judgment includes an impermissible double recovery of
interest, (4) the trial court erred in admitting unreliable expert testimony, (5) the

award of exemplary damages is constitutionally excessive, (6) the jury charge

includes instructions that inappropriately comment on the weight of the evidence,

and (7) the judgment was based on a claim that was illegally assigned in whole or in

part. We conclude the assignment issue was resolved in the previous appeal, and we

decline to reconsider our holding. After reviewing the record, we further conclude

the evidence is sufficient to support the jury’s findings. With respect to the jury

charge, however, we conclude that one of the jury instructions constituted an

impermissible comment on the weight of the evidence that was calculated to cause,

and probably did cause, the rendition of an improper judgment. Accordingly, we

reverse the trial court’s judgment and remand the cause for further proceedings

consistent with this opinion.

                                   Background

      In 2004, HSM, a real estate broker, and its former employee, Steven Defterios,

negotiated the purchase of nine commercial real estate properties on behalf of their

client, James A. Flaven. The properties were owned by various partnerships and

limited liability companies formed by Barry Nussbaum. Defterios told Nussbaum

that Flaven was the beneficiary of a multimillion dollar trust fund and he wanted to

use the money to invest in real estate. Flaven eventually put $500,000 in an escrow

account and signed contracts to purchase the properties with an initial closing date

of August 2004.

                                        –2–
        The closing date was rescheduled multiple times, and Defterios told

Nussbaum it appeared there were problems getting Flaven’s trust to release the

money. According to Nussbaum, Defterios stated on many occasions that he had

verified the existence of the funds and the closings were imminent. Over a year

later, however, when the contracts still had not closed, Flaven disappeared. The

properties at issue were either deeded to banks in lieu of foreclosure or sold for a

loss.

        The companies that owned the properties sued HSM and Defterios for fraud

and negligent misrepresentation (the “Underlying Suit”). Terry served as trial

counsel for both defendants. Despite knowing from the beginning that Flaven could

be held at least partly responsible for the property owners’ damages, Terry stated he

actively chose not to pursue finding Flaven or involving him in the case because he

suspected Flaven was a con man and he did not want to help the property owners

develop facts showing that Defterios had lied. Shortly before trial, the property

owners located Flaven’s brother who revealed that Flaven was a truck driver and not

the beneficiary of a trust fund. Flaven himself was never found.

        After Flaven’s brother was deposed, Terry attempted to designate Flaven as a

responsible third party (“RTP”). The motion to designate was filed twenty-four days

before trial and asserted that Flaven was responsible for all or, alternatively, a

proportionate part of the damages suffered by the property owners. The property

owners objected that the motion to designate Flaven was untimely and Terry had no

                                        –3–
valid reason for not designating him earlier. They further objected that HSM and

Defterios had not pleaded sufficient facts to show a duty owed by Flaven to the

property owners. The trial court denied the motion to designate Flaven without

stating the reason for its ruling.

      The Underlying Suit was tried to a jury. During the course of trial, Defterios

admitted he never verified Flaven had the money necessary to fund the purchases.

At the close of evidence, Terry stipulated Defterios was acting within his agency

relationship with HSM and that any findings against him would be binding on HSM.

Terry stated the reason for the stipulation was that, although there was evidence

showing Defterios was an independent contractor, HSM allowed Defterios to use the

title of HSM vice-president on his email account, letterhead, and business cards.

Based on a statutory provision that stated real estate brokers are responsible for the

conduct of their salespersons, Terry believed HSM could not avoid liability for

Defterios’s conduct, and he did not want the property owners to be able to argue

Defterios’s title was another fraudulent misrepresentation.

      The jury ultimately found against HSM and Defterios and awarded the

property owners over $12 million in damages. The trial court rendered judgment on

the verdict and added prejudgment interest and costs to the final award. On appeal,

this Court modified the judgment in minor respects, but otherwise affirmed. See

Defterios v. Bayou Bend, Ltd., 350 S.W.3d 659 (Tex. App.—Dallas 2011, pet.

denied).

                                         –4–
        Following the verdict, HSM and Defterios filed this suit against Terry for

malpractice. The allegations of negligence included that Terry failed to timely

designate Flaven as an RTP and erred in stipulating HSM was responsible for

Defterios’s conduct.1 Diamond State Insurance Company, HSM’s insurance carrier,

was also named as a defendant after it denied coverage for the judgment. The

judgment creditors in the Underlying Suit filed an involuntary petition in bankruptcy

against HSM which resulted in a reorganization plan approved by the bankruptcy

court in July 2010. Under the plan, a portion of HSM’s claims against Terry and

Diamond State was assigned to the judgment creditors.

        HSM eventually settled with Diamond State before trial for $6 million. As a

result, all of HSM’s and Defterios’s claims against Diamond State were nonsuited.

Immediately before trial, Defterios also nonsuited his claims against Terry and was

no longer a party to the suit.           The case proceeded to trial solely on HSM’s

malpractice claims against Terry.

       After hearing the evidence, the trial court directed a verdict in favor of Terry

on HSM’s claims for gross negligence. The jury then found that the combined

negligence of Terry, HSM, and Defterios was the proximate cause of HSM’s injury.

The jury apportioned responsibility as 50% to Terry, 40% to Defterios, and 10% to

HSM. The jury further found that the amount by which the judgment rendered in

   1
    HSM additionally asserted that Terry was negligent in failing to offer expert testimony as to
damages and in failing to advise HSM of the potential conflict of interest between it and Defterios.
                                               –5–
the Underlying Suit exceeded the judgment that would have been rendered but for

Terry’s negligence was $4,636,088. In the judgment, the trial court disregarded the

jury’s findings regarding Defterios, applied the 10% responsibility found by the jury

as to HSM, and concluded the $6 million credit from HSM’s settlement with

Diamond State exceeded the amount of HSM’s recoverable damages. Accordingly,

the trial court rendered judgment that HSM take nothing on its claims against Terry.

       HSM appealed the judgment to this Court. See Henry S. Miller Commercial

Co. v. Newsom, Terry & Newsom, L.L.P., No. 05-14-01188-CV, 2016 WL 4821684

(Tex. App.—Dallas Sept. 14, 2016, pet. denied) (mem. op.) (“HSM I”). Terry filed

a cross appeal asserting, among other things, that the assignment of a part of HSM’s

malpractice claims to its judgment creditors was illegal and barred any recovery. Id.

at *2. We concluded that HSM’s right to bring its own cause of action for

malpractice was not affected by the assignment and resolved the issue against Terry.

Id. at *3.

       In addressing HSM’s appeal, we concluded the trial court properly directed a

verdict in favor of Terry on HSM’s claim for gross negligence arising out of his

stipulation that HSM was responsible for Defterios’s conduct. Id. at *5. We further

held, however, that the trial court erred in directing a verdict for Terry on HSM’s

claim for gross negligence arising out of Terry’s failure to timely designate Flaven

as an RTP. Id. at *7. We reasoned that Terry could have designated Flaven earlier

based solely on “the proposed transaction, its failure, and Flaven’s identity as the

                                        –6–
defaulting buyer” without conceding that Flaven was a fraud or that Defterios had

misrepresented Flaven’s wealth. Id. at *6. There was additional evidence showing

Terry was aware of the extreme risks associated with not designating Flaven and that

he chose not to do so despite those risks. Id. We recognized that Terry presented

expert testimony supporting his concerns that designating Flaven earlier could have

helped the property owners prove their case, and that his decision to wait to designate

Flaven until after Flaven’s brother was deposed was justified. Id. at *7. But we

concluded “the existence of controverting evidence is not the standard for

determining whether a directed verdict was proper.” Id. We therefore reversed the

trial court’s judgment and remanded the case for a new trial on both liability and

damages. Id. at *8.

      On remand, HSM’s malpractice claims against Terry were, once again, tried

to a jury. In support of their allegations of negligence, HSM presented the testimony

of Marc Stanley, counsel for the property owners in the Underlying Suit, and Lewis

Sifford, HSM’s legal expert. Stanley testified that Terry’s failure to designate

Flaven as an RTP was a “break” for him in representing the property owners because

he was afraid a jury would put most, if not all of the blame for the failed transactions

on Flaven from whom the property owners would not be able to collect damages.

He felt that Flaven would be seen as the “lead bad guy” who conned everyone,

including HSM and Defterios. Stanley stated that all of his clients’ damages were

ultimately caused by Flaven because of his failure to close on the purchase contracts.

                                          –7–
Stanley acknowledged he needed proof that Flaven was a fraud to succeed on his

claims against HSM and he stated the deposition of Flaven’s brother provided him

with that proof.

      Sifford testified similarly. He stated that a reasonably prudent lawyer would

have designated Flaven as an RTP earlier in the case because it was a “major avenue

of defense.” He pointed to the fact that Terry identified Flaven as a responsible third

party early in discovery and, in an email to Diamond State ten months before trial,

Terry characterized Flaven as “the principal actor in the claim.” Sifford stated that

juries tend to look for the “bad actor” in the case when determining fault. Here,

Flaven was the initiator of all the bad acts and the reason the purchases did not close.

Regardless of whether it was discovered that Flaven had no money, Sifford testified

Terry could have placed the blame on Flaven for the property owners’ damages

based solely on the fact that he breached the purchase contracts.

      Sifford stated Terry was negligent in not giving the jury the opportunity to

apportion at least some of the liability for the property owners’ damages to Flaven.

Sifford noted that, in the untimely motion to designate Flaven, Terry stated Flaven

could be found responsible for all of the property owners’ damages. Terry made the

same argument about Flaven’s responsibility to the jury in his closing argument in

the Underlying Suit. Given that there was no dispute that Flaven was a con man,

and there was no evidence that HSM was aware of Flaven’s fraud before he

                                          –8–
disappeared, Sifford testified that a jury would likely have placed all of the liability

on Flaven if he had been properly designated.

      In contrast, Terry and his legal expert, Rogge Dunn, testified there were valid

reasons for not designating Flaven as an RTP sooner. Terry testified that if he had

designated Flaven earlier in the case, they would have needed to pursue discovery

to support the designation. Terry did not want to give the property owners evidence

to show that Flaven did not have the money he claimed to have. According to Terry,

this evidence would have simply helped the property owners prove that Defterios

lied when he said he had verified the existence of Flaven’s funds. It was Defterios’s

misrepresentation that formed the entire basis of the property owners’ claims.

      Dunn agreed with Terry, stating that, HSM’s best defense was that there was

no evidence Defterios lied and, without Flaven in the case, there was no proof he

was not the beneficiary of a large trust fund. He stated it was likely a jury would

have believed the money existed based on Flaven’s ability to make a $500,000

earnest money deposit. The fact that Flaven simply walked away from the deal

would not, by itself, show that anyone committed fraud. In Dunn’s opinion, it was

not until Flaven’s brother testified Flaven did not have the money he claimed to have

that the purpose in not designating Flaven was removed.

      The charge submitted to the jury contained the following instruction on the

designation of RTPs:

                                          –9–
       With respect to the designation of responsible third parties,
the relevant portions of Section 33.004 of the Texas Civil
Practice and Remedies Code provide as follows:

       (a) A defendant may seek to designate a person as a
responsible third party by filing a motion for leave to designate
that person as a responsible third party. The motion must be filed
on or before the 60th day before the trial date unless the court
finds good cause to allow the motion to be filed at a later date.

                             ***
       (f) A court shall grant leave to designate the named person
as a responsible third party unless another party files an objection
to the motion for leave on or before the 15th day after the date
the motion is served.
       (g) If an objection to the motion for leave is timely filed,
the court shall grant leave to designate the person as a responsible
third party unless the objecting party establishes:
       (1) the defendant did not plead sufficient facts concerning
the alleged responsibility of the person to satisfy the pleading
requirement of the Texas Rules of Civil Procedure; and
       (2) after having been granted leave to replead, the
defendant failed to plead sufficient facts concerning the alleged
responsibility of the person to satisfy the pleading requirements
of the Texas Rules of Civil Procedure.

                           ***
       (1) After adequate time for discovery, a party may move
to strike the designation of a responsible third party on the
ground that there is no evidence that the designated person is
responsible for any portion of the claimant’s alleged injury or
damage. The court shall grant the motion to strike unless a
defendant produces sufficient evidence to raise a genuine issue
of fact regarding the designated person’s responsibility for the
claimant's injury or damage.

       Under this statute, a defendant is not required to provide
evidence at the time of the filing of a motion for leave to
designate a responsible third party, but the designation may be
struck, by the Court, for lack of evidence after an adequate time
for discovery has passed.

                           –10–
                    The designation of a responsible third party may be struck
             for lack of evidence after an adequate time for discovery has
             passed, as determined by the court. In resisting a motion to strike
             a designation of a responsible third party, the Terry Defendants
             would not have been required to prove the plaintiffs’ case that
             there was fraud in the underlying transaction. They could rely on
             evidence of the proposed transaction, its failure, and the identity
             of a responsible third party as the defaulting buyer in resisting a
             motion to strike a designation of a responsible third party.

      Terry objected to the last two paragraphs of the RTP instruction contending

that, to the extent they merely repeated the statute, the repetition “constituted an

impermissible comment by the Court on the weight of the evidence by drawing

particular attention to sections of the statute that are already stated verbatim.” As

for the last two sentences of the instruction, the lawyers objected that “to the extent

that Plaintiff relies on [HSM I], that authority is irrelevant and was unavailable to

Defendants at the time of the underlying trial, and does not save the added two

paragraphs from being redundant, incorrect, an improper comment on the weight of

the evidence, and unduly prejudicial.” The trial court overruled Terry’s objections.

      Unlike the charge in the first malpractice trial, the charge submitted to the jury

in the second trial included only questions regarding Terry’s liability for HSM’s

damages. Question No. 1 asked,

            Did the negligence, if any, of the Terry Defendants proximately
      cause the injury complained of by Henry S. Miller in this lawsuit?

The jury answered, “Yes.”

Question No. 2 asked,

                                        –11–
             What is the amount, if any, by which the judgment actually
      rendered in the Underlying lawsuit exceeded the judgment that would
      have been rendered but for the negligence you have found on the part
      of the Terry Defendants?

The jury answered, “$13,626,997.”

Question No. 3 asked,

             Do you find by clear and convincing evidence that the harm to
      Henry S. Miller resulted from gross negligence by the Terry Defendants
      in not timely seeking to designate James Flaven a responsible third
      party?

The jury answered, “Yes.”

And, finally, Question No. 4 asked,

            What sums of money, if any, should be assessed against the Terry
      Defendants and awarded to Henry S. Miller as exemplary damages for
      the conduct found in response to Question No. 1?

In response to Question No. 4, the jury found Steven Terry liable for $6 million in

exemplary damages and Newsom, Terry & Newsom, L.L.P. liable for $1 million in

exemplary damages.

      The issue of attorney’s fees damages arising from the property owners’ post-

judgment collection efforts and the bankruptcy proceedings against HSM was

presented to the trial court for resolution. The court signed a final judgment

awarding HSM “$15,395,910.20 (representing $14,303,316.50 in actual damages,

plus prejudgment interest of $3,444,575.25, both having been appropriately reduced

by a settlement credit of $6,000,000), plus additional prejudgment interest at the rate

of $1,635.60 per day from December 20, 2019, until the day before this judgment

                                        –12–
was signed, [] $6,000,000 in exemplary damages against Defendant Steven K. Terry,

and [] $1,000,000 in exemplary damages against Defendant Newsom, Terry &

Newsom.” Terry timely brought this appeal.

                                          Analysis

I. Illegality of Assignment

       In his ninth issue, Terry contends the trial court erred in signing a judgment

on the malpractice claim because the claim was illegally assigned to the judgment

creditors in the Underlying Suit. In his briefing, Terry acknowledges this Court

resolved this issue against him in our previous opinion in this case. See id. at *3.

Terry states he has briefed the assignment issue “to provide the Court the opportunity

to reconsider its holding in HSM I.” We decline to do so. Accordingly, we overrule

Terry’s ninth issue.

II. Sufficiency of the Evidence

       In his second, third, and sixth issues, Terry contends the evidence presented

at trial was legally and factually insufficient to support the jury’s findings on

(1) breach of the standard of care, (2) proximate cause, and (3) gross negligence.2 In

reviewing a legal sufficiency challenge to the evidence, we credit evidence that

supports the verdict if a reasonable factfinder could have done so and disregard

   2
     Terry also challenges the sufficiency of the evidence supporting the amount of damages
awarded by the jury. For the reasons discussed in section III below, it is unnecessary for us to
address the sufficiency of the evidence supporting either the amount of damages or HSM’s claims
of negligence other than Terry’s failure to timely designate Flaven as an RTP.
                                             –13–
contrary evidence unless a reasonable factfinder could not have done so. Akin,

Gump, Strauss, Hauer & Feld, L.L.P. v. Nat’l Dev. & Research Corp., 299 S.W.3d

106, 115 (Tex. 2009); City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005).

We consider all the evidence in the light most favorable to the prevailing party and

indulge every reasonable inference in that party’s favor. St. Joseph Hosp. v. Wolff,

94 S.W.3d 513, 520–21 (Tex. 2003). The evidence is legally sufficient if “more than

a scintilla of evidence exists.” Browning–Ferris, Inc. v. Reyna, 865 S.W.2d 925,

928 (Tex. 1993). More than a scintilla of evidence exists if the evidence furnishes

some reasonable basis for differing conclusions by reasonable minds about a vital

fact’s existence. Litton Loan Servicing, L.P. v. Manning, 366 S.W.3d 837, 840 (Tex.

App.—Dallas 2012, pet. denied). The final test for legal sufficiency must always be

whether the evidence at trial would enable reasonable and fair-minded people to

reach the verdict under review. Del Lago Partners, Inc. v. Smith, 307 S.W.3d 762,

770 (Tex. 2010).

      To evaluate a factual sufficiency challenge, we consider and weigh all the

evidence. Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001) (per curiam).

We can set aside a verdict only if the evidence is so weak or the finding is so against

the great weight and preponderance of the evidence that it is clearly wrong and

unjust. Id. We must not substitute our judgment for that of the factfinder and should

remain cognizant that the factfinder is the sole judge of witness credibility. Golden

Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757, 761 (Tex. 2003).

                                        –14–
      “When a legal malpractice case arises from prior litigation, the plaintiff must

prove that the client would have obtained a more favorable result in the underlying

litigation had the attorney conformed to the proper standard of care.” Rogers v.

Zanetti, 518 S.W.3d 394, 401 (Tex. 2017). The proper standard of care is whether

the decision made by the attorney was an objective exercise of professional judgment

that a reasonably prudent attorney could make in the same or similar circumstances,

not whether the attorney subjectively believed his acts were done in good faith.

Cosgrove v. Grimes, 774 S.W.2d 662, 665 (Tex. 1989). The failure to meet the

proper standard of care may include an attorney’s failure to exercise ordinary care

in preparing, managing, and presenting litigation. Alexander v. Turtur & Assocs.,

Inc., 146 S.W.3d 113, 119 (Tex. 2004). Expert testimony is required to show that

tactical choices were unwise and the consequences of those choices. Id. at 119–20.

Imprudent attorney actions that materially and unfavorably affect a client’s defense

will support a malpractice claim. Rogers, 518 S.W.3d at 404.

      In this case, the evidence showed it was apparent early in the Underlying Suit

that Flaven could be found at least partially, if not entirely, responsible for the

damages suffered by the property owners. Terry disclosed Flaven as a potential RTP

more than a year before trial, but chose not to designate him until after the deadline

had passed. Without Flaven submitted to the jury as a potentially responsible party

in the charge, there was no way for HSM to reduce its proportionate liability in the

Underlying Suit. See HSM I, 2016 WL 4821684, at *5.

                                        –15–
       Terry argues that HSM’s assertion that he could have designated Flaven

earlier is purely speculative. He points to the fact that the trial court did not state its

reasoning when it denied Terry’s motion to designate Flaven. But, as we noted in

HSM I, the trial court has little discretion regarding a timely-filed motion to

designate an RTP. Id. The only two grounds asserted by the property owners in

their objection to the designation were untimeliness and a lack of support in the

pleadings. Had Terry designated Flaven earlier in the case, he would have had an

opportunity to cure any deficiencies in the pleadings.

       Terry next argues that “in his judgment, designating Flaven earlier would have

harmed HSM’s defense” because he was “concerned that, had Flaven been found,

he would have helped prove [the property owner’s] case that Defterios was lying

about Flaven’s financial resources.” While Terry may have believed his actions

were in HSM’s best interests, the jury was free to accept the evidence presented by

HSM that Terry’s decision to not designate Flaven earlier was negligent. This is

particularly true since it was not necessary for Terry to find Flaven to designate him

as an RTP. See id. at *6 (“Neither was it necessary to serve Flaven, join him in the

lawsuit, or even determine his whereabouts in order to designate him as a responsible

third party.”). Flaven’s proportionate liability could have been established through

the contracts he signed and his failure to close.

       Finally, Terry argues there is insufficient evidence to show that his actions

were the proximate cause of any damages. He contends that if the jury would have

                                          –16–
found Flaven liable for all the property owner’s damages, as HSM contends, then

“logic dictates” the jury would have found no negligence on the part of HSM

regardless of whether Flaven was listed in the charge. But failing to name Flaven as

a responsible third party necessarily skewed the proceedings and shifted the focus to

HSM. See In re Greyhound Lines, Inc., No. 05-13-01646-CV, 2014 WL 1022329,

at *4 (Tex. App.—Dallas Feb. 21, 2014, orig. proceeding) (mem. op.). The jury was

presented with evidence of significant damages suffered by the property owners.

And with Flaven not listed in the charge as a potentially responsible person, the jury

could easily have decided to place the blame on HSM and Defterios as Flaven’s

brokers in the transaction, rather than have the property owners recover nothing.

Terry’s decision, therefore, materially and unfavorably affected HSM’s defense. See

Rogers, 518 S.W.3d at 404.

      Terry also argues there is no evidence the jury would have found Flaven more

than 50% responsible in the Underlying Suit. Thus, Terry contends there is no

evidence that, but for his alleged negligence, HSM would not have been jointly and

severally liable for the entire amount of the judgment under section 33.013(b)(1) of

the Texas Civil Practice and Remedies Code. Terry does not explain why joint and

several liability is not materially better than sole liability. Additionally, Terry does

not address the fact that, in both his motion to designate Flaven and his closing

argument to the jury in the Underlying Suit, Terry contended Flaven was responsible

for most, if not all, of the property owners’ damages. HSM presented expert

                                         –17–
testimony that juries tend to look for the “bad actor” when assigning liability. Given

that Flaven was the reason the deals were made, the source of the alleged fraud, and

the only person responsible for breaching the purchase contracts, we cannot

conclude the evidence is insufficient to show that a jury would likely have found

Flaven more than 50% liable for the property owners’ damages.

      With respect to the evidence of gross negligence, we previously held based on

a substantially similar record that the evidence was legally sufficient to support a

finding that Terry was grossly negligent. See HSM I, 2016 WL 4821684, at *7.

After reviewing the record before us in this appeal, we conclude once again that the

evidence is legally sufficient, and further conclude the jury’s finding that Terry was

grossly negligent is not so against the great weight and preponderance of the

evidence as to be clearly wrong and unjust. The record shows Terry was aware early

in the case that HSM was facing significant exposure, yet he consciously chose not

to designate a party he knew could bear a substantial portion of the responsibility.

While Terry argues that gross negligence can never be based on an error in judgment,

an attorney’s tactical decisions must be objectively reasonable. Cosgrove, 774

S.W.2d at 665. HSM presented evidence that no reasonably prudent attorney would

have waited until after the deadline had passed to designate Flaven as an RTP given

the extreme risk that HSM could be found solely liable for the property owner’s

damages.

                                        –18–
      In the alternative, Terry argues the allegedly negligent acts on which this suit

was based were all committed by him alone and there is no evidence to support the

jury’s finding of gross negligence against his law firm. Terry cites no authority in

support of this argument. It is undisputed that, at all relevant times, Terry was a

partner of Newsom, Terry & Newsom, LLP. A firm practicing as a limited liability

partnership is liable for the malpractice of its partners. See David v. Howeth, No.

02-20-00078-CV, 2020 WL 6165298, at *12 n.6 (Tex. App.—Fort Worth Oct. 22,

2020, pet. denied) (mem. op.).

      Based on the foregoing, we conclude the evidence is legally and factually

sufficient to support the jury’s findings as to breach of duty, proximate cause, and

gross negligence.

III. Jury Instruction on RTP Designation

      Although the evidence is sufficient to support the jury’s findings, we conclude

the judgment must be reversed because the jury charge included an instruction that

improperly suggested how the jury should resolve the issues of Terry’s negligence

and gross negligence. Terry challenges the propriety of several portions of the

charge in his eighth issue. Our analysis focuses on the last two sentences of the RTP

instruction which read,

             In resisting a motion to strike a designation of a responsible third
             party, the Terry Defendants would not have been required to
             prove the plaintiffs’ case that there was fraud in the underlying
             transaction. They could rely on evidence of the proposed
             transaction, its failure, and the identity of a responsible third

                                        –19–
             party as the defaulting buyer in resisting a motion to strike a
             designation of a responsible third party.

      This portion of the instruction pulls language from our opinion in HSM I and

imports it into the jury charge out of context. The original context was a discussion

of whether there was sufficient evidence to support a finding that Terry was grossly

negligent. See HSM I, 2016 WL 4821684, at *7. In concluding there was, we stated

that Terry could have designated Flaven as an RTP earlier based on “the proposed

transaction, its failure, and Flaven’s identity as the defaulting buyer.” Id. But we

also observed there was evidence, including expert testimony, showing that a

reasonably prudent lawyer would have waited until after Flaven’s brother was

deposed, and Flaven’s fraud was revealed, to designate Flaven. Id. We concluded

that, while the jury could have credited this testimony and found in favor of Terry,

the existence of controverting evidence was not the standard for granting a directed

verdict. Id. The conflicting evidence required the issue to be submitted to the jury.

Id.

      By instructing the jury that Terry would not have been required to “prove the

plaintiffs’ case” to designate Flaven as an RTP, the charge suggested, if not overtly

instructed the jury, that Terry’s reasoning for not designating Flaven earlier in the

case was flawed. The charge made HSM’s theory of negligence the law of the case.

A trial court’s charge may not comment on the evidence or the weight of the

evidence in any manner. See TEX. R. CIV. P. 277. An impermissible comment on

the weight of the evidence occurs when, after examining the entire charge, it is
                                    –20–
determined that the judge assumed the truth of a material controverted fact or

exaggerated, minimized, or withdrew some pertinent evidence from the jury’s

consideration. Am. Bankers Ins. Co. v. Caruth, 786 S.W.2d 427, 434 (Tex. App.—

Dallas 1990, no writ). An instruction also will be held to be an improper comment

on the weight of the evidence if it suggests to the jury the court’s opinion concerning

the matter about which the jury is asked. Ferguson v. DRG/Colony N., Ltd., 764

S.W.2d 874, 886 (Tex. App.—Austin 1989, writ denied). Instructing the jury on an

issue that has previously been decided as a matter of law may constitute an unlawful

comment on the weight of the evidence where the instruction was unnecessary to

clarify the issues still to be decided by the jury. Mader v. Aetna Cas. & Sur. Co.,

683 S.W.2d 731, 733 (Tex. App.—Corpus Christi–Edinburg 1984, no writ).

       The first portion of the RTP instruction sets forth the relevant provisions of

section 33.004 of the civil practice and remedies code. This gave the jury all the law

it needed on the requirements for designating responsible third parties and the level

of proof necessary to resist a motion to strike. Including our discussion of the gross

negligence evidence from HSM I added no clarity to the law to be applied, but rather

served only to suggest that the jury should find Terry negligent.           See In re

Commitment of Shelton, No. 02-19-00033-CV, 2020 WL 1887722, at *12 n.7 (Tex.

App.—Fort Worth April 16, 2020, no pet.) (mem. op. on reh’g) (instructions in jury

charge should not advise jury that a fact issue has been conclusively established

since instruction might unduly influence jury’s answers about other facts in the

                                        –21–
case); see also Bd. of Regents of N. Tex. State Univ. v. Denton Const. Co., 652

S.W.2d 588, 594–95 (Tex. App.—Fort Worth 1983, writ ref’d n.r.e.) (instruction

that tended to imply court thought law and facts were with appellee was erroneously

prejudicial). A statement of law that encourages the jury to resolve a question a

certain way, even if it is a correct statement of law, should not be in the jury charge.

GTE Mobilnet v. Telecell Cellular, 955 S.W.2d 286, 292 (Tex. App.—Houston [1st

Dist.] 1997, pet. denied).

      The issue of Terry’s tactical choices was a hotly contested issue at trial. An

improper instruction is especially likely to cause an unfair trial when the evidence is

sharply conflicting. Halmos v. Bombardier Aerospace Corp., 314 S.W.3d 606, 617–

618 (Tex. App.—Dallas 2010, no pet.). The reasoning behind Terry’s decision to

not designate Flaven as an RTP earlier was the subject of extensive testimony,

including expert testimony from both sides. Trial tactics is the type of issue that

requires expert testimony. See Childs v. Crutchfield, No. 09-07-065 CV, 2007 WL

5075982, at *6 (Tex. App.—Beaumont Sept. 13, 2008, pet. denied) (mem. op.). As

such, any suggestion by the court that Terry should have made a different decision

would likely sway a jury. By expanding the RTP instruction to specifically state

what Terry could have done, the trial court necessarily implied what it believed Terry

should have done.

      Reversal is required if an improper comment on the weight of the evidence is

one that was calculated to cause and probably did cause the rendition of an improper

                                         –22–
judgment. Redwine v. AAA Ins., 852 S.W.2d 10, 14 (Tex. App.—Dallas 1993, no

writ). In his closing argument at trial, HSM’s counsel spent a great deal of time on

the RTP issue. On multiple occasions, he used the language in the charge to dispute

Terry’s testimony regarding his choice of tactics in the Underlying Suit saying:

                    Well, you guys are going to look in the charge. The charge
            literally says the fact that you can identify the person who is
            responsible for closing and he didn’t close is sufficient to file the
            responsible third-party. It’s in the charge. You guys will look at
            it.

                  Why did I ask all my questions? Because I knew that was
            going in the charge, right?

            ...

            And what he’s going to tell you is he had to wait until he got
            Brian Flaven’s deposition to prove Flaven was a con man. And
            that - - you’re going to look at the charge, that is simply flat
            wrong. It’s just wrong. He did not have to wait until he got Brian
            Flaven’s deposition.

Because of the inclusion of the language from our prior opinion in the jury charge,

HSM’s counsel was able to argue the charge would instruct them that Terry’s

strategy, and his defense to the negligence claim on the RTP issue, was invalid.

      In addition to counsel’s argument, the wording of the jury questions made the

RTP issue the sole focus of the charge. Although Question No. 1 asked the jury

about Terry’s negligence generally, Question No. 3 asked whether “the harm” to

HSM resulted from Terry’s gross negligence in failing to timely designate Flaven as

an RTP. By using the phrase “the harm,” the question asked whether all the harm

suffered by HSM was caused by Terry’s untimely attempt to designate Flaven.
                                        –23–
Question No. 4 then asked the jury to determine what amount of exemplary damages

should be assessed for the conduct found in response to Question No.1. Because a

plaintiff can only recover exemplary damages for gross negligence, and the only act

of negligence that was asserted as being grossly negligent was the failure to timely

designate Flaven, the charge necessarily presumed the untimely RTP designation

was the basis of the general negligence finding in Question No. 1. Accordingly, the

improper RTP instruction impacted all of the jury’s responses and likely caused the

rendition of an improper judgment. We sustain Terry’s eighth issue.

      We are cognizant of the fact that reversal in this case may require the parties

to engage in a third trial on the merits. This result is compelled, however, by the

trial court’s submission of a jury charge that was patently unfair to the defendants.

Based on the foregoing, it is unnecessary for us to address the remainder of Terry’s

issues. We reverse the trial court’s judgment in its entirety and remand the cause for

further proceedings consistent with this opinion.

                                           /Amanda L. Reichek/
                                           AMANDA L. REICHEK
                                           JUSTICE

Carlyle, J., dissenting.

200379F.P05

                                        –24–
                                    S
                            Court of Appeals
                     Fifth District of Texas at Dallas
                                   JUDGMENT

NEWSOM, TERRY & NEWSOM,                        On Appeal from the 134th Judicial
LLP AND STEVEN K. TERRY,                       District Court, Dallas County, Texas
Appellants                                     Trial Court Cause No. DC-09-01306-
                                               G.
No. 05-20-00379-CV           V.                Opinion delivered by Justice
                                               Reichek. Justices Nowell and Carlyle
HENRY S. MILLER                                participating.
COMMERCIAL COMPANY,
Appellee

       In accordance with this Court’s opinion of this date, the judgment of the trial
court is REVERSED and this cause is REMANDED to the trial court for further
proceedings consistent with this opinion.

      It is ORDERED that each party bear its own costs of this appeal.

Judgment entered August 31, 2022

                                        –25–