Court Opinion

ID: 4164810
Source: CourtListenerOpinion
Date Created: 2017-05-01 11:19:52.152233+00
Date Added: 2024-06-11T07:46:53.767252
License: Public Domain

IN THE SUPREME COURT OF TEXAS
                                     ════════════
                                       NO. 15-0338
                                     ════════════

        TOM BENNETT AND JAMES B. BONHAM CORPORATION, PETITIONERS,

                                               v.

                          LARRY WAYNE GRANT, RESPONDENT

        ═════════════════════════════════════════════
                      ON PETITION FOR REVIEW FROM THE
               COURT OF APPEALS FOR THE THIRD DISTRICT OF TEXAS
        ═════════════════════════════════════════════

                                   Argued January 12, 2017

       JUSTICE WILLETT delivered the opinion of the Court.

       In this latest chapter of a long-running dispute, we consider how the harm likely to result

from a malicious prosecution should be evaluated in calculating exemplary damages. We conclude

the court of appeals erred in considering the harm that plaintiff would suffer from wrongful

imprisonment when the chances of this occurring were essentially zero given the expired statute

of limitations. Accordingly, we reverse the portion of the court of appeals’ judgment awarding

exemplary damages. On all other issues, we affirm.
                                                I. Background

                                 A. Factual and Procedural Framework

                   This suit arises from an infamous cattle-rustling incident in San Saba County.1 The

facts were hotly contested.

        The dispute between two ranchers, Thomas O. Bennett and Randy Reynolds, began over

fifteen years ago, when thirteen of Reynolds’ cattle meandered onto Bennett’s land. Instead of

returning the cattle to Reynolds, Bennett instructed his ranch hand, Larry Wayne Grant, to round

up the cattle and sell them. Grant was hesitant as to the legality of this request and took photographs

of the cattle as they were sold. Reynolds learned of the photos and pressured Grant to turn them

over to the police.

        Grant called Bennett and Bennett’s employee, Don Rogers, informing them of the

existence of the photos. Grant alleged that he only called to urge them to “make it right” with

Reynolds. Bennett, however, charged that Grant tried to blackmail him. Grant admitted that he

spoke to Rogers about selling the photos to Bennett, but insisted they only “joked about it.”

Regardless, a month later, Grant gave the photos to the police. Bennett was indicted for cattle theft.

He was eventually acquitted, but he and his company, James B. Bonham Corporation, were found

liable in the Bennett I civil suit for the converted cattle, resulting in $5,327.11 in actual damages

and $1.25 million in exemplary damages.2

        1
         The Court previously dealt with the same underlying facts in Bennett v. Reynolds, 315 S.W.3d 867 (Tex.
2010) (Bennett I).
        2
            We reversed the award of exemplary damages in Bennett I.

                                                        2
       Today’s dispute concerns related litigation between Bennett and Grant. Two years after

Grant called Bennett and Rogers about the photos, Bennett brought blackmail charges against

Grant to authorities in four separate counties. Bennett admitted it was not until after his criminal

trial that he reported the phone call and admitted at trial that his primary “goal” in doing so was to

put “Grant in prison . . . for what he’s done to me.” After the district attorneys in three of the

counties refused to prosecute Grant, Bennett met with the district attorney in Navarro County, who

referred the case to federal authorities. Bennett was displeased with this outcome and contacted

the district attorney again, this time presenting a new theory of attempted theft. The district

attorney said these charges were barred because of the two-year statute of limitations. Then, for

the first time, Bennett claimed that Grant tried to extort money from him a second time,

conveniently falling within the limitations period. At trial of the pending suit, the district attorney

testified that he was “skeptical” of the new information because it “appeared that there was maybe

some tailoring of the facts going on to fit the statute.” The new evidence was also notably missing

from Bennett’s sworn testimony; instead, Bennett testified that all factual allegations against Grant

were based on the original phone call. Because of his suspicions, the district attorney refused to

prosecute.

       Bennett then met with an attorney who had represented Bonham Corp. for more than

twenty years and requested that he write a legal brief concluding that Grant’s acts constituted a

criminal offense worthy of prosecution. The district attorney said it was this brief, or a subsequent

meeting with Bennett, that acted as a “catalyst” convincing him to bring the case to the grand jury.

The grand jury, however, was unpersuaded and refused to indict Grant. Undeterred, Bennett again

met with Bonham Corp.’s attorney, who advised Bennett to petition for appointment of a special

                                                  3
prosecutor in Navarro County to bring the case before the grand jury again. Bennett drafted the

petition and acquired 250 signatures from Navarro County residents under a procedure for

appointing a special prosecutor.3 Bennett then met with the district attorney, requesting

appointment of his neighbor, Robert Dunn, as special prosecutor. At the time, the district attorney

was seeking reelection. Concerned that Bennett’s petition drive “wasn’t helping” his campaign, he

agreed to Dunn’s appointment.

       The special prosecutor claimed he used his independent discretion in deciding to bring the

case before the grand jury a second time. But he acknowledged that the statements from Bennett

and Rogers were “very material to [his] decision to proceed to the grand jury.” There were some

troubling inconsistencies in the information presented to the special prosecutor. Specifically, there

is no evidence that Bennett told the special prosecutor about the second alleged extortion attempt

(the non-time-barred attempt) as he had represented to the district attorney. Bennett also claimed,

for the first time, that Grant had asked him to pay a specific sum—$5,000—for the photos.

Additionally, the special prosecutor testified that Bennett spoke to him about secretly taped

conversations with Grant that substantiated his $5,000 claim, which the district attorney did not

acknowledge in his testimony.

       Bennett’s quest to imprison Grant seemed promising after the special prosecutor presented

the evidence to a second grand jury and obtained two felony indictments. However, nine months

later, the indictments were quashed because the charges were barred by limitations. Years earlier,

Bennett had initiated the pending civil suit by suing Grant for slander, based on allegations that

       3
           Bennett v. Grant, 460 S.W.3d 220, 230 (Tex. App.—Austin 2015).

                                                      4
Grant had told Reynolds and others that the cattle belonged to Reynolds. After Grant was cleared

of criminal charges and his record expunged, he filed a counterclaim in the civil suit for malicious

prosecution. A jury found Bennett and Bonham Corp. liable to Grant for malicious prosecution.

The trial court awarded Grant $10,703 in actual damages ($5,000 for mental anguish and $5,703

in attorney fees), and $1 million each against Bennett and Bonham Corp. in exemplary damages.

The trial court also assessed sanctions of $269,644.50 against Bennett for filing a frivolous slander

claim.

         Bennett and Bonham Corp. appealed, raising numerous issues. They argued that the jury’s

malicious-prosecution findings were legally insufficient. They also claimed the jury’s awards for

actual and exemplary damages were not supported by legally sufficient evidence and that the $2

million exemplary-damages award was unconstitutional. The court of appeals concluded the

actual-damage awards enjoyed ample support.4 However, the court remitted the amount of

exemplary damages because the ratio between actual and exemplary damages “likely exceed[ed]

constitutional limits.”5 The court of appeals reduced exemplary damages to $512,109 each against

Bennett and Bonham Corporation.

                              B. Summary of Issues and Our Disposition

         Bennett and Bonham Corp.’s arguments can be grouped into three issues: damages, joinder,

and sanctions. First, we conclude the jury’s award of mental-anguish damages is supported by

legally sufficient evidence. However, the exemplary-damages award remains unconstitutionally

         4
             Id. at 241–42.
         5
             Id. at 252.

                                                 5
excessive, even after it was reformed by the court of appeals. Second, the trial court did not abuse

its discretion in allowing Grant to join Bonham Corp. as a defendant. Third, the sanctions awarded

against Bennett need not be remanded for reconsideration under Nath v. Texas Children’s

Hospital.6

                                                 II. Analysis

       Here, Bennett and Bonham Corp. do not challenge the court of appeals’ determination that

legally sufficient evidence supports malicious-prosecution liability. Instead, they challenge the

damages awarded, both actual and exemplary, plus the trial court’s joinder and sanctions rulings.

                                            A. Actual Damages

       The trial court awarded actual damages of $10,703: $5,000 in mental-anguish damages,

and $5,703 in attorney fees that Grant incurred in defending the criminal charge of attempted

bribery.

       The petitioners argue there was insufficient evidence to support mental-anguish damages.

We disagree. An award for mental anguish must be supported by either (1) a substantial disruption

in the plaintiff’s daily routine, or (2) evidence of a high degree of mental pain and distress that is

more than mere worry, anxiety, vexation, embarrassment, or anger.7 There must be evidence of

the existence of compensable mental-anguish damages and evidence to justify the amount

awarded.8

       6
           446 S.W.3d 355 (Tex. 2014).
       7
           Parkway Co. v. Woodruff, 901 S.W.2d 434, 444 (Tex. 1995).
       8
           Hancock v. Variyam, 400 S.W.3d 59, 68 (Tex. 2013).

                                                       6
       Non-economic damages, such as mental-anguish damages, “cannot be determined by

mathematical precision; by their nature, they can be determined only by the exercise of sound

judgment.”9 As we stated in Saenz v. Fidelity & Guaranty Insurance Underwriters,10 given “the

impossibility of any exact evaluation of mental anguish . . . juries [must] be given a measure of

discretion in finding damages, [though] that discretion is limited. Juries cannot simply pick a

number and put it in the blank. They must find an amount that, in the standard language of the jury

charge, ‘would fairly and reasonably compensate’ for the loss.”11 The amount awarded must be

fair and reasonable compensation, given the evidence presented.12 Admittedly, this standard is

simple but not simplistic: “Reasonable compensation is no easier to determine than reasonable

behavior—often it may be harder—but the law requires factfinders to determine both.”13 Appellate

courts must conduct a meaningful evidentiary review of these determinations.14

       In Bentley v. Bunton,15 we held there was no evidence to support a $7 million mental-

anguish award because it was excessive, unreasonable, and “far beyond any figure the evidence

can support.”16 Similarly, in Saenz, we rendered a take-nothing judgment because there was no

       9
           Bentley v. Bunton, 94 S.W.3d 561, 605 (Tex. 2002).
       10
            925 S.W.2d 607 (Tex. 1996).
       11
            Id. at 614.
       12
            Id.
       13
            Id.
       14
            Id.
       15
            94 S.W.3d 561 (Tex. 2002).
       16
            Id. at 607.

                                                        7
evidence that plaintiff suffered any mental anguish or that the $250,000 award was fair and

reasonable.17 This case is distinct from these prior cases, as ample evidence supports the relatively

modest award of mental-anguish damages.

       Grant’s testimony persuasively demonstrates that he suffered a high degree of mental pain

and distress. For instance, Grant testified that he knew well before his indictment that Bennett

would come after him for showing photos of the stolen cattle to the police. Grant’s daily routine

was substantially disrupted: He moved four times, trying to keep himself and his family safe from

Bennett, built a privacy fence around his property, and even testified that Bennett would appear at

depositions with a tape recorder and pencil to obtain Grant’s newest address. He was afraid to

leave his house and experienced headaches, a weak stomach, a loss of appetite, and sleep

deprivation. He stated that he was aware of prior instances where Bennett “had seen that people

went to prison.” He testified that he fully believed Bennett was capable of doing the same to him,

and that he had heard Bennett proclaim he would see Grant “go to the penitentiary.” Grant’s sister

testified that his demeanor had changed significantly, as he closed himself off and became distant

from everyone.

       In sum, we agree with the court of appeals that sufficient evidence supports Grant’s $5,000

mental-anguish award. The $5,703 attorney-fee award is not contested on appeal. Accordingly, we

affirm the actual-damages portion of the court of appeals’ judgment.

       17
            Saenz, 925 S.W.2d at 614.

                                                 8
                                         B. Exemplary Damages

       The more difficult dispute concerns the exemplary-damages award. As noted, the trial court

rendered judgment on the verdict and awarded $1 million each against Bennett and Bonham

Corporation. The court of appeals then reduced the damages to $512,109 each. The petitioners

claim that even as remitted, the exemplary damages cannot stand. We agree.

       Our review first examines the exemplary-damages cap under state law and then evaluates

the award’s constitutionality under the United States Constitution.

                           1. The Chapter 41 Cap-Busting Exception Applies.

       As a general rule, the Texas Civil Practice and Remedies Code restricts the maximum

amount of exemplary damages a trial court may award.18 But this cap does not apply when a

plaintiff seeks exemplary damages based on certain felony criminal conduct.19 The court of appeals

properly held that this case falls under an exception to the cap, namely securing execution of a

document (the indictment) by deception.20 This is a felony under Penal Code section 32.46, which

states: “A person commits an offense if, with intent to defraud or harm any person, he, by deception

. . . causes another to sign or execute any document affecting property or service or the pecuniary

interest of any person.”21

       18
            See TEX. CIV. PRAC. & REM. CODE § 41.008(b).
       19
            Id. § 41.008(c).
       20
            Id. § 41.008(c)(11).
       21
            TEX. PENAL CODE § 32.46(a) (emphasis added).

                                                      9
          Bennett and Bonham Corp. argue that an indictment affects a liberty interest but not a

pecuniary interest as contemplated by section 32.46. Although the Penal Code does not define

“pecuniary interest,” Texas courts have interpreted it to mean a financial or monetary stake in the

matter.22 The petitioners contend that because an indictment is a formal accusation of a crime and

does not directly affect a person’s monetary interest, it falls outside the exception. The statute,

however, does not by its terms require the document in question to “directly” affect a person’s

pecuniary interest. Further, while it is true that an indictment is different in kind from financial

documents like a bank draft or a promissory note, the statutory text does not require that the

complainant have a pecuniary interest in the document itself; rather the document must affect the

complainant’s pecuniary interest.23

          We agree with the court of appeals that when viewing the evidence in the light most

favorable to the jury’s finding,24 there is more than a mere scintilla of evidence that Grant’s

pecuniary interest was affected by the indictment. Grant was required to post a $10,000 bond

immediately to avoid imprisonment and to hire attorneys to quash the indictment. And if convicted

of attempted bribery, he could face up to $10,000 in penalties. The court of appeals correctly

applied Chapter 41’s cap-busting exception.

          22
          See Briones v. State, 76 S.W.3d 591, 595 (Tex. App.—Corpus Christi 2002, no pet.); Goldstein v. State,
803 S.W.2d 777, 791 (Tex. App.—Dallas 1991, writ ref’d).
          23
               See Lewis v. State, No. 05-09-00299-CR, 2010 WL 4400515, at *2 (Tex. App.—Dallas Nov. 8, 2010, pet.
ref’d).
         24
            City of Keller v. Wilson, 168 S.W.3d 802, 807 (Tex. 2005) (stating that when conducting a legal-sufficiency
review, a court should consider the evidence in the light most favorable to the judgment).

                                                         10
                2. The Exemplary-Damages Award Is Unconstitutionally Excessive.

        There is, however, a problem with the court of appeals’ analysis of the award’s

constitutionality. The petitioners contend the remitted dual $512,109 exemplary-damages awards

are excessive and violate federal due process. We agree.

        As an overarching premise, exemplary damages further the state’s interest in punishing and

deterring unlawful conduct. But this punishment should not be so grossly excessive as to “further[]

no legitimate purpose and constitute[] an arbitrary deprivation of property.”25 Therefore, even if

the Texas cap on exemplary damages is inapplicable, there remains a federal constitutional check

on the award, as explicated by the United States Supreme Court. 26 We must consider three

guideposts when reviewing an exemplary-damages award: (1) the degree of reprehensibility of the

misconduct; (2) the disparity between the exemplary-damages award and the actual harm suffered

by the plaintiff or the harm likely to result; and (3) the difference between the exemplary damages

awarded and the civil or criminal penalties that could be imposed for comparable conduct.27

Reviewing the constitutionality of an exemplary-damages award is a question of law we review

de novo.28

        25
           Bennett I, 315 S.W.3d 867, 873 (Tex. 2010) (quoting State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S.
408, 417 (2003)).
         26
            See BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 562 (1996) (stating that the Due Process Clause of the
Fourteenth Amendment prevents a state from granting a “grossly excessive” punishment); State Farm, 538 U.S. at
418 (setting forth a three-part test for constitutional exorbitancy).
        27
             State Farm, 538 U.S. at 418.
        28
             Bunton v. Bentley, 153 S.W.3d 50, 54 (Tex. 2004).

                                                         11
        We agree with the court of appeals’ analysis of the first guidepost. Evaluating

reprehensibility requires consideration of whether: (1) the harm inflicted was physical rather than

economic; (2) the tortious conduct showed an indifference to or reckless disregard for the health

or safety of others; (3) the target of the conduct had financial vulnerability; (4) the conduct

involved repeated actions; and (5) the harm resulted from intentional malice, trickery or deceit.29

There is significant evidence indicating that the petitioners’ conduct satisfies at least the four latter

factors. These factors are nonexclusive, and the finding of four of them supports an award of

exemplary damages.

        Similarly, we agree with the court of appeals’ analysis of the third guidepost. This prong

requires us to compare the exemplary damages with legislatively authorized civil penalties in

comparable cases. Here, because there is no analogous civil penalty for Bennett’s actions, we look

to potential criminal penalties, although criminal penalties are viewed as less instructive than

potential civil penalties.30 The court of appeals cited various criminal penalties of which Bennett

had fair notice, including tampering with or fabricating physical evidence, aggravated perjury

before a grand jury, execution of a document by deception, and making a false report to a peace

officer or law enforcement employee. These crimes could result in $46,000 in fines and up to

twenty-two years of imprisonment. Thus, although there are no comparable civil penalties for

Bennett’s conduct, Bennett was on notice that the State had a substantial interest in preventing

improper use of the criminal justice system and would punish those who sought to sully it.

        29
             State Farm, 538 U.S. at 419.
        30
             Id. at 428.

                                                   12
        Our disagreement with the court of appeals’ analysis relates to the second guidepost:

analyzing the ratio between the exemplary damages awarded and the actual harm suffered by the

plaintiff or the harm likely to result. While there is no bright-line rule for the ratio, the United

States Supreme Court has indicated that few awards exceeding a single-digit ratio satisfy due

process standards.31 In Bennett I, we noted that a ratio above 4:1 “might be close to the line of

constitutional impropriety.”32 Here, the ratio is initially troublesome. The compensatory damages

total $10,703, and the exemplary damages are $512,109 against each defendant, giving us a ratio

of nearly 48:1.

        In evaluating whether the ratio is excessive, we must ask “whether there is a reasonable

relationship between the punitive damages award and the harm likely to result from the defendant’s

conduct as well as the harm that has likely occurred.”33 This requires a three-part inquiry, looking

at (1) the exemplary damages awarded, (2) the actual damages, defined as the harm that has likely

occurred, and (3) “potential damages,” defined by the United States Supreme Court as the harm

likely to result from defendant’s conduct.34 For the potential damages here, the burden of proof is

on Grant to show to a probability, not merely to a speculation, that he would suffer these damages.

        31
             Id. at 425.
        32
             Bennett I, 315 S.W.3d 867, 878 (Tex. 2010) (quoting State Farm, 538 U.S. at 425).
        33
             TXO Prod. Corp. v. Alliance Res. Corp., 509 U.S. 443, 460 (1993) (emphasis in original).
         34
            See, e.g., BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 582 (1996) (narrowing the terms “potential” damages
and “potential” harm to mean damages/harm likely to result); Philip Morris USA v. Williams, 549 U.S. 346, 354 (2007)
(same); State Farm, 538 U.S. at 410 (same); Cooper Indus., Inc. v. Leatherman Tool Grp., Inc., 532 U.S. 424, 440
(2001) (same); United States v. Bajakajian, 524 U.S. 321, 346 (1998) (same); TXO, 509 U.S. at 460 (same).

                                                         13
       Bennett and Bonham Corp. assert the court of appeals articulated two conflicting standards

for determining potential harm: (1) analysis of the harm likely to result from the defendant’s bad

acts, versus (2) analysis of the harm that would have ensued if the tortious plan had succeeded.

There is no conflict; rather, the latter is an example of the former. The United States Supreme

Court clarified as much in Gore, rephrasing “harm likely to result” as “the harm to the victim that

would have ensued if the tortious plan had succeeded.”35 The High Court used them

interchangeably, not alternatively. Simply put, there is no “objective likelihood” standard for

determining potential harm pitted against a “what actually would have happened” standard. Any

wording differences are semantic, not substantive.

       The court of appeals properly articulated that potential harm is the harm likely to result

from the defendant’s conduct. But it improperly included the consequences of wrongful

imprisonment in its calculations, such as the compensation the State provides to those wrongfully

convicted. It figured that if Grant had been wrongfully imprisoned for two years, the statutory

minimum for this crime, the State would pay him $160,000 under a statutory compensation scheme

available to defendants wrongfully convicted. Similarly, if he received the maximum sentence of

ten years’ imprisonment, the State would pay him $800,000, as well as potential lifetime annuity

payments. Following this logic, the damages could exceed $1 million. The court of appeals then

concluded “the potential damages in this case can be prudently and rationally valued at a minimum

of $160,000,” as this is “the minimum amount Grant would have received from the State if he had

       35
            Gore, 517 U.S. at 581.

                                                14
been wrongfully convicted of attempted bribery and served the minimum sentence available.”36

Therefore, combining the actual and potential damages would total $170,703, making the ratio

5:1. The court of appeals held that this ratio exceeded constitutional limits and reduced the

exemplary-damages award to $512,109 against each defendant, resulting in a 3:1 ratio.

       The court of appeals was right to remit, but the remittitur was not enough. The problem

was the court’s consideration of Grant’s possible prison sentence at all. When evaluating potential

harm, the court should have looked to the harm likely to result from Bennett’s conduct. Here, there

was essentially zero likelihood of imprisonment because the statute of limitations barred the claim

against Grant. Therefore, the potential harm analysis should have only focused on the probable

damages resulting from the malicious prosecution, not the consequences of wrongful

imprisonment. When concentrating solely on the likely harm from malicious prosecution, it is

appropriate to consider, for example, that Grant would incur attorney fees in defending himself

against criminal charges. It is also fair to consider time taken away from one’s job by having to

participate in criminal proceedings.

       Grant bore the burden to prove the criminal justice system would ultimately fail to resolve

this case correctly. He failed to meet this burden, providing no evidence that he could be convicted,

let alone imprisoned, exonerated, and fully compensated. Indeed, the statute of limitations barred

any claim against Grant, and there was effectively no chance he would be imprisoned. As the court

of appeals recognized, “Bennett’s long and hard-fought quest ended nine months later, when both

of Grant’s indictments were quashed because the charges had been filed past the statute of

       36
            Bennett v. Grant, 460 S.W.3d 220, 252 (Tex. App.—Austin 2015).

                                                      15
limitations.”37 Grant failed to show imprisonment was likely to result from Bennett’s conduct, and

the court of appeals was wrong to consider imprisonment-related damages.

        We recognize the State’s tremendous interest in preventing malicious prosecution and

wrongful imprisonment. But these wrongs are not synonymous, and should not be treated as such.

Here, Grant had the burden to prove that imprisonment was likely— an impossible burden given

the preclusive effect of limitations. The court of appeals engaged in speculation when making its

calculations, contrary to the definition of potential harm provided by the United States Supreme

Court. We thus reverse and remand the exemplary-damages award to the court of appeals for a

more substantial remittitur.

                                                    C. Joinder

        Procedural matters, such as joinder and the consolidation of claims, are left to the discretion

of the trial court, whose rulings will not be overturned absent an abuse of discretion.38 An abuse

of discretion occurs when the trial court “acted without reference to any guiding rules and

principles.”39 Bonham Corp. argues the trial court erred by allowing Grant to join it as a third-

party defendant under Rule of Civil Procedure 38(a). While Bonham Corp. is correct that Rule

38(a) does not apply here, the joinder does not amount to an abuse of discretion. Also, Bonham

Corp. waived this issue by not complaining of misjoinder to the trial court.

        37
             Id. at 232.
        38
             Allison v. Ark. La. Gas Co., 624 S.W.2d 566, 568 (Tex. 1981).
       39
          Cire v. Cummings, 134 S.W.3d 835, 838–39 (Tex. 2004) (quoting Downer v. Aquamarine Operators, Inc.,
701 S.W.2d 238, 241–42 (Tex. 1985)).

                                                         16
       Joinder is appropriate given the background of this case. After Grant revealed the cattle

photos to police and Reynolds sued Bennett for conversion, Bennett sued Grant for slander. Grant

counterclaimed, alleging Bennett was liable to him for intentional infliction of emotional distress.

Because Grant failed to join Bonham Corp. within thirty days after filing his original answer, the

trial court rejected his initial effort to join Bonham Corp. as a third-party defendant. The trial court

instructed Grant to seek leave “pursuant to Rule 38” before trying again. Grant subsequently filed

a “Motion for Leave to Include James B. Bonham Corporation.” This motion did not include the

specific rule under which Bonham Corp. should be joined, but it did explicitly request leave “to

file a third-party action” against Bonham Corp. for intentional infliction of emotional distress. It

did not allege that Bonham Corp. was liable for any part of Bennett’s slander claim against Grant.

The trial court granted joinder, but did not specify the grounds for doing so. Bonham Corp. then

filed its original answer to Grant’s counterclaim. After the wrongful indictment was filed against

Grant, Grant amended his counterclaim against Bennett and Bonham Corp. to add malicious

prosecution. Bonham Corp., in response, filed its original answer to the new counterclaim and did

not argue that it was wrongly joined.

       Here, Grant did not request joinder under a specific rule, and the trial court did not specify

a rule when it granted joinder. Rule 38(a) states that a defendant may join a third party who may

be liable to the defendant or to the plaintiff for all or part of the plaintiff’s claims against the

defendant.40 Joinder on these grounds would be improper here, as Grant did not allege that Bonham

Corp. was liable to Bennett for any part of Bennett’s slander claim against Grant.

       40
            TEX. R. CIV. P. 38(a).

                                                  17
        However, joinder was permissible under other rules. For instance, under Rule 37, joinder

of “additional parties necessary or proper parties to the suit” is permitted.41 Additionally, under

Rule 39, joinder of an additional party is permitted if “in his absence complete relief cannot be

accorded among those already parties.”42 Further, under Rule 40, permissive joinder of parties as

defendants is allowed if a plaintiff or counter-plaintiff asserts against them “any right to relief . . .

arising out of the same transaction [or] occurrence.”43 We agree with the court of appeals that trial

courts have broad discretion in determining whether parties should be joined.44 Because the trial

court did not specify the rule on which it relied, and because there are several grounds on which

joinder would be permissible, there was no abuse of discretion.

        Further, Bonham Corp. waived this issue because it did not object to joinder before the trial

court. Generally, an issue presented in a petition for review before this Court must have “been

preserved for appellate review in the trial court and assigned as error in the court of appeals.”45

Bonham Corp. did not object to joinder in the trial court, but rather complained for the first time

in the court of appeals. Joinder is an issue that arises in the trial court, and to preserve error,

Bonham Corp. was required to present its objection there. Because it failed to do so, Bonham Corp.

has waived the issue in this Court.

        41
             TEX. R. CIV. P. 37.
        42
             TEX. R. CIV. P. 39.
        43
             TEX. R. CIV. P. 40.
        44
             Bennett v. Grant, 460 S.W.3d 220, 238 (Tex. App.—Austin 2015).
         45
            G.T. Leach Builders, LLC v. Sapphire V.P., LP, 458 S.W.3d 502, 516–17 (Tex. 2015) (quoting TEX. R.
APP. P. 53.2(f)).

                                                       18
                                                D. Sanctions

       The trial court signed an order sanctioning Bennett “for filing a groundless slander claim

against [Grant] in bad faith and for the purpose of harassment.” The trial court determined that

Grant should receive $269,644.50 in litigation costs for defending Bennett’s slander claim and

conditional appellate attorney fees. This sanction was included in the final judgment. The court of

appeals affirmed the sanctions.

       We review the imposition of sanctions for abuse of discretion.46 As noted above, a trial

court abuses its discretion if it acts without reference to any guiding rules or principles. 47 In Low,

this Court articulated several factors for trial courts to consider when awarding sanctions.48 The

courts need not consider every factor, but they should consider all relevant factors. 49 Bennett

contends the sanctions against him should be remanded for reconsideration under Nath v. Texas

Children’s Hospital.50

       In Nath, the trial court imposed sanctions on Nath for frivolously filing a lawsuit against a

hospital and based the amount on the hospital’s attorney fees.51 Nath appealed, alleging the

sanctions were excessive.52 We held the hospital was responsible for some of its attorney fees

       46
            Low v. Henry, 221 S.W.3d 609, 614 (Tex. 2007).
       47
            Id.
       48
            Id. at 620 n.5.
       49
            Id. at 620–21.
       50
            446 S.W.3d 355 (Tex. 2014).
       51
            Id. at 361.
       52
            Id.

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because it litigated the case for five years before moving for summary judgment based on the

statute of limitations, which could have been brought years earlier.53 In Nath, “the degree to which

the offended person’s own behavior caused the expenses for which recovery is sought” was a

relevant factor.54

         Bennett’s reliance on Nath is misplaced. Here, although the litigation was frivolous as

Grant alleged in his original answer, he could not have ended the litigation sooner because there

was no determinative legal question as existed in Nath. Evaluating whether the litigation was

frivolous required a factfinder to determine whether Bennett lied and the suit was brought in bad

faith. In fact, the jury answered this very question in their jury charge. 55 Accordingly, Bennett’s

sanctions award should be upheld.

                                                 III. Conclusion

         We reverse the exemplary-damages portion of the court of appeals’ judgment and remand

to that court for remittitur in light of this opinion. In all other respects, we affirm the court of

appeals’ judgment.

                                                      __________________________________________
                                                      Don R. Willett
                                                      Justice

OPINION DELIVERED: April 28, 2017

         53
              Id. at 372.
         54
              Id.
        55
           Question 19 of the jury charge asked: “Was the Plaintiff Tom Bennett’s suit against Larry Grant groundless,
and brought in bad faith or for the purpose of harassment?” The jury answered “yes.”

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