Court Opinion

ID: 9760382
Source: CourtListenerOpinion
Date Created: 2023-08-29 00:51:16.202337+00
Date Added: 2024-06-11T07:29:11.404091
License: Public Domain

SPEARS, Justice,
dissenting.
I respectfully dissent. The trial court properly allowed Wingate to amend his pleadings to assert a personal cause of action for fraud against Hajdik; therefore, the damages awarded for that action were properly recoverable. Because Hajdik did not object to the trial court’s failure to segregate these damages from those awarded for the misappropriation of corporate assets cause of action, the entire award must stand. At the very least, this court should remand the cause to the trial court with instructions that it segregate the damages resulting from Hajdik’s misappropriation of corporate assets from the damages recoverable on Wingate's personal cause of action for fraud.
Traditionally, Texas courts have allowed the free amendment of pleadings. See Jago v. Indemnity Ins. Co. of North America, 120 Tex. 204, 36 S.W.2d 980 (1931); Boren v. Billington, 82 Tex. 137, 18 S.W. 101 (1891). We are not unique in this regard, “for the history of procedure reveals the concurrent development over the centuries of a liberal policy toward amendments coincident with a growing tolerance toward informalities of pleading.” 2 R. McDonald, Texas Civil Practice in District and County Courts § 8.06 (rev. 1981). Currently, Rule 63 of the Texas Rules of Civil Procedure provides:
Parties may amend their pleadings ... provided, that any amendment offered for filing within seven days of the date of trial or thereafter ... shall be filed only after leave of the judge is obtained, which leave shall be granted by the judge unless there is a showing that such amendment will operate as a surprise of the opposite party.
The use of the word “shall” is a mandatory directive. If surprise is not shown, Rule 63 requires the trial court to allow the amendment. Goswami v. Metropolitan Sav. & Loan Ass’n, 751 S.W.2d 487, 490 (Tex. *7211988). The burden of convincing a trial court that the filing of an amended pleading will operate as a surprise rests on the party resisting the filing of the pleading. Hardin v. Hardin, 597 S.W.2d 347, 350 (Tex.1980) (Campbell, J., concurring); Poe v. Hutchins, 737 S.W.2d 574 (Tex.App.-Dallas 1987, writ ref’d n.r.e.).
A trial court’s decision to allow an amendment within seven days of trial will not be disturbed unless the complaining party shows an abuse of discretion. Hardin, 597 S.W.2d at 350; Merit Drilling Co. v. Honish, 715 S.W.2d 87 (Tex.App.-Corpus Christi 1986, writ ref'd n.r.e.). The complaining party’s mere allegation of surprise and prejudice is not enough to preserve the right to complain on appeal that the trial court abused its discretion in allowing the amendment. Hardin, 597 S.W.2d at 350; Lloyd’s of London v. Walker, 716 S.W.2d 99, 103 (Tex.App.-Dallas 1986, writ ref’d n.r.e.). The party must file a motion to strike which specifically demonstrates how he is surprised and prejudiced by the amendment and, if the motion is overruled, he must file a motion for continuance.1
Hajdik alleged in his motion to strike that he was “surprised and prejudiced” by Wingate’s amended petition, that the amendment attempted to state a new cause of action, and that the issues raised by the amendment had never been raised before. In his argument at trial in support of his motion Hajdik asserted that the amendment alleged a “securities fraud” cause of action and that he was “not prepared” to defend such an action. However, Hajdik never made a “showing” of how' he was surprised by the amendment. He did not, for example, advise the trial court: (1) of any witnesses who were needed and unavailable to testify regarding the fraudulent inducement cause of action; (2) of how he would have prepared differently or how he would be prejudiced by going forward with the proceeding; or (3) that additional discovery or evidence was needed to adequately present his defense. See Cummings v. Rice, 9 Tex. 527 (1853); Texas Employers Ins. Ass’n v. Sanders, 265 S.W.2d 219, 221 (Tex.Civ.App.-Texarkana 1954, writ ref’d n.r.e.).
Most importantly, Hajdik never filed a motion for continuance. In the absence of such a motion, the trial court might reasonably have assumed that Hajdik was prepared to try the fraudulent inducement action. This assumption would be supported by the fact that Wingate’s initial pleadings made general allegations of fraud, that Hajdik announced ready for trial, and that Hajdik subsequently proffered evidence and argument in defense of the fraudulent inducement action. In short, after reviewing all the circumstances it cannot be reasonably said that the trial court abused its discretion in allowing the filing of the amendment.
Since Wingate was clearly entitled to recover damages on his timely pleaded personal cause of action for fraud, the question becomes whether the trial court’s award of damages must still be reversed because it failed to segregate the damages recoverable between Wingate’s fraud action and his unauthorized actions for breach of fiduciary duty and misappropriation of corporate assets. It should not, and the majority’s unsupported conclusion to the contrary is plainly wrong.
On March 4, 1987, the trial court rendered a written, final judgment which included express “findings” that Hajdik’s fraudulent representations, misappropriation of corporate assets and breach of fiduciary trust proximately caused damages to *722Wingate. Based on these findings, the judgment awarded Wingate a single sum of actual damages and prejudgment interest, and further awarded exemplary damages, attorney’s fees and costs. On April 3, 1987, Hajdik filed a motion for new trial which argued that: 1) “no judgment should have been rendered” in Wingate’s favor individually on a claim for misappropriation of corporate assets because this claim belonged to the corporation; and 2) the trial court erred in awarding damages to Win-gate for his personal action for fraud because Wingate’s amended petition setting forth this claim should have been stricken under Tex.R.Civ.P. 63. Finally, on April 14, 1987, the trial court filed findings of fact and conclusions of law stating that its damages award was based on Hajdik’s fraudulent misrepresentations, misappropriation of corporate assets and breach of fiduciary duty.
The foregoing confirms that Hajdik knew when he filed his motion for new trial that the trial court’s judgment granted an unsegregated damages award for both a personal action for fraud and a corporate action for misappropriation of assets. Since it has been established that the trial court properly allowed Wingate’s amended petition claiming the personal action for fraud, the damages award is sustainable as it relates to that theory of recovery. Any error in the judgment’s failure to segregate damages between the authorized fraud action and the unauthorized corporate cause of action was waived by Hajdik’s failure to request segregation in either his motion for new trial, via a further request for findings and conclusions, or on appeal. By holding otherwise, today’s majority rewards Hajdik for “laying behind the log”2 and, in doing so, ignores the spirit of a number of procedural rules and decisions of this court.
Clearly, if this had been a jury trial, Hajdik’s failure to complain of the trial court’s failure to segregate damages between the underlying theories of recovery would have waived the issue. See Tex.R. Civ.P. 274; Birchfield v. Texarkana Memorial Hosp., 747 S.W.2d 361, 368 (Tex.1987) (by failing to object, the defendant waived any argument that the damages issue did not specifically relate to the asserted grounds of recovery); Wilgus v. Bond, 730 S.W.2d 670, 672 (Tex.1987); cf. Matthews v. Candlewood Builders, Inc., 685 S.W.2d 649, 650 (Tex.1985) (defendants failure to object to broad attorney fee issue waived any complaint that trial court erred in allowing jury to consider and award attorney fees not associated with plaintiff’s successful claim); Pioneer Finance & Thrift Corp. v. Adams, 426 S.W.2d 317, 320 (Tex.App.-Eastland 1968, writ ref’d n.r.e.) (by failing to object, the defendant waived any argument that the damages award should be reversed because it included damages for a trespass cause of action which should not have been allowed). These “preservation of error” rules should apply with equal force to the present nonju-ry case because the judgment apprised Haj-dik of the bases of the damages award, and because Hajdik never objected (at trial or on appeal) to the judgment’s failure to segregate damages between recoverable and nonrecoverable claims.
For all the above reasons I would reverse the decision of the court of appeals and affirm that of the trial court.
RAY and MAUZY, JJ., join in this dissent.

. See, e.g., Kaufman Northwest, Inc. v. Bi-Stone Fuel Co., 529 S.W.2d 281, 288 (Tex.Civ.App.-Tyler 1975, writ ref'd n.r.e.); Miller v. Wagoner, 356 S.W.2d 363, 367 (Tex.Civ.App.- Austin 1962, no writ); Finlayson v. Roberts, 82 S.W.2d 1020, 1022 (Tex.Civ.App.-Fort Worth 1935, no writ). The party objecting to the amendment, if his resistance is unavailing, must supplement his objections with a motion for continuance, for he cannot show upon appeal that he has been forced to trial unless he has unsuccessfully sought delay. If the court grants a continuance based on surprise, and if the surprised party satisfactorily shows that he is not ready for trial because of the allowance of the amended pleading, the court may charge the continuance to the amending party, and may also require the amending party to pay any reasonable costs and expenses caused by the continuance, including attorney fees. Tex.R.Civ.P. 70.

. We can reasonably assume that Hajdik's failure to request segregation was not unintentional but strategic; by failing to request segregation, Hajdik eliminated the possibility that the trial court would attribute most of the damages award to the personal fraud cause of action. By enforcing this strategy, the majority guts the fundamental rule that a complainant must apprise the trial court of any error in order to allow it to correct its mistake.