Opinion
01-19-00306-CV
06-03-2021
BMB DINING SERVICES (WILLOWBROOK), INC. AND RCI HOSPITALITY, INC., Appellants v. WILLOWBROOK I SHOPPING CENTER L.L.C., AND LEON VAHN, Appellees
On Appeal from the 333rd District Court Harris County, Texas Trial Court Case No. 2015-20985
Panel consists of Justices Countiss, Rivas-Molloy, and Guerra.
MEMORANDUM OPINION
Veronica Rivas-Molloy Justice
Appellants BMB Dining Services (Willowbrook), Inc. ("BMB") and RCI Hospitality, Inc. ("RCI") appeal the trial court's judgment in favor of appellees Willowbrook I Shopping Center L.L.C. and Leon Vahn (collectively, "Willowbrook") rendered after a jury trial. In four issues, BMB and RCI argue that (1) the trial court erred by disregarding the jury's finding of future rent due under the parties' commercial lease agreement and substituting its own finding; (2) there is no evidence supporting the jury's findings that RCI breached a related guaranty agreement and that such breach caused Willowbrook damages; (3) the trial court erred by refusing to offset BMB's accrued rent by the value of the replacement commercial lease obtained by Willowbrook; and (4) the trial court abused its discretion by awarding Willowbrook attorney's fees. We affirm the trial court's judgment.
Background
This appeal stems from a commercial lease dispute between two sophisticated parties. BMB owns and operates several Bombshells restaurants, all of which have large outdoor patios. On October 14, 2014, BMB, as tenant, and Willowbrook, as landlord, executed a commercial lease (the "Lease") for a 9, 603-square-foot freestanding building with an existing 900-square-foot outdoor side patio (the "Premises"). The parties agreed that BMB would lease the Premises for 10 years. That same month, Willowbrook also executed a limited lease guaranty with BMB's parent company, RCI, as guarantor, in which RCI guaranteed BMB's obligations under the Lease for the first three years, including the prompt payment of rent and all other sums due in connection with the Lease (the "Guaranty"). The Guaranty further obligated RCI to pay Willowbrook all costs, expenses, and fees incurred in enforcing the Guaranty.
In January 2015, BMB began constructing a large-scale patio, outside bar, and bandstand on the Premises. According to BMB, having a large patio with an outside bar and bandstand is an integral component of its restaurant concept. The Lease, however, did not contemplate BMB's expanded patio. Rather, the Lease allowed only for the use of the existing 900-square-foot side patio. The Lease also required BMB to obtain Willowbrook's written approval of final plans and specifications for any modifications to the Premises. Although Willowbrook subsequently approved BMB's plans for the interior work to the building, it did not approve the plans for its outdoor patio.
On March 25, 2015, Willowbrook sent BMB a Notice of Breach of Lease and Cease and Desist Demand letter alleging BMB had no right under the Lease to make any modifications to common areas, including to the outdoor space, without Willowbrook's written approval. Later, on April 10, 2015, Willowbrook sued BMB for breach of contract and RCI for breach of the Guaranty.
BMB and RCI filed a general denial. BMB also filed counterclaims against Willowbrook and a third-party petition against its owner, Leon Vahn, for breach of contract, promissory estoppel, quantum meruit, fraud, misrepresentation, fraudulent inducement and non-disclosure, conspiracy, reformation, and rescission.
On August 21, 2015, Willowbrook terminated the Lease and BMB's right of possession of the Premises. RCI, as guarantor, was copied on Willowbrook's notice of default and demand and included as an addressee on Willowbrook's notice of termination and demand for payment. Neither BMB nor RCI paid any money due under the Lease to Willowbrook.
Willowbrook contends that it terminated the Lease after BMB abandoned the Premises and refused to make the initial rent payments when they became due.
In October 2017, Willowbrook signed a replacement commercial lease with FEXY, Inc. ("FEXY"). The parties later tried the case to the jury in September 2018. In addition to evidence regarding each party's alleged failures to comply with the Lease and Guaranty, Willowbrook and BMB also offered competing expert testimony concerning the amount of future rent due under the Lease for the remainder of its term and the fair rental value of the Premises, both discounted to present value. Specifically, Willowbrook's expert, Mark Sikes ("Sikes"), opined that the value of future rent BMB would have paid under the Lease for the remainder of its term, discounted to present value, was $2,231,284. BMB's expert, David Dominy ("Dominy"), did not dispute Sikes's future rent calculation.
Sikes and Dominy, however, disagreed with respect to the fair rental value of the Premises. Sikes testified that he examined four comparable properties at or near the Willowbrook shopping center and opined that the fair rental value of the Premises for the duration of the Lease, discounted to present value, was $1,931,612. Dominy, who had performed a similar analysis using four other properties on behalf of BMB and RCI, opined that the fair rental value of the Premises for the same period of time discounted to present value, was $2,231,284. There was no testimony that the fair rental value of the Premises discounted to present value could ever be "$0."
At the conclusion of trial, the jury was charged with making findings regarding the respective parties' liabilities, if any, and the amount of damages resulting from the parties' failure to comply with their respective contractual obligations. The jury found that although Willowbrook had not breached its contractual obligations to BMB, BMB and RCI had breached their contractual duties to Willowbrook. The jury then made certain fact findings regarding the different categories of damages Willowbrook sought to recover, as set forth in jury Question 5.
The jury also found that BMB's failure to comply was not excused and that BMB had unclean hands with respect to Willowbrook.
Jury Question 5 stated:
What sum of money, if any, if paid now in cash, would fairly and reasonably compensate Willowbrook for its damages, if any, that resulted from [BMB's] failure to comply with the Lease Agreement?
Consider the following elements of damages, if any, and none other. Do not add any amount for interest on damages, if any. Answer separately in dollars and cents for damages, if any.
5.1 Unpaid Rent and other amounts accrued under the Lease Agreement to the date of Termination.
Answer: $42,752.73
5.2 Costs and Expenses incurred by Willowbrook in repairing, cleaning, painting, restoring, altering, remodeling or otherwise putting the Premises and Common Areas into condition acceptable to a new tenant.
Answer: $0
5.3. Reasonable and necessary expenses incurred in attempting to lease the Premises after [BMB] breached the Lease Agreement.
Answer: $0
5.4 Please determine the amount, if any, for each of the following -
A. the total Rent that [BMB] would have been required to pay under the Lease Agreement for the remainder of the Lease Term following the date of termination discounted to present value as of the date of termination:
Answer: $0
B. the fair rental value of the Premises, as of the date of termination, to the end of the Lease Term, discounted to present value:
Answer: $0
The jury found in response to Question 5.1 that BMB owed Willowbrook $42,752.73 in unpaid rent and other amounts accrued under the Lease through termination. The jury also found that the "the total Rent that [BMB] would have been required to pay under the Lease Agreement for the remainder of the Lease Term following the date of termination discounted to present value as of the date of termination" (Question 5.4A) and "the fair rental value of the Premises, as of the date of termination, to the end of the Lease Term, discounted to present value" (Question 5.4B) was "$0." With respect to RCI, the jury found that RCI owed Willowbrook $550,000 for RCI's breach of the Guaranty (Question 10).
Willowbrook filed a motion for entry of judgment asking the trial court to, among other things, disregard the jury's finding of $0 in response to Question 5.4A, because the evidence conclusively established that the total future rent BMB would have been required to pay under the Lease for the remainder of its term, discounted to present value, was $2,231,284.00. Willowbrook also argued that the trial court should award it $557,821.00 in liquidated damages pursuant to Article 17.2(a) of the Lease, which provides in pertinent part that in the event of default, Willowbrook may at its discretion terminate the Lease and recover a sum of money equal to the amounts set forth in subsection (a), including:
(iii) Liquidated Damages in an amount equal to (A) the total Rent that Tenant would have been required to pay for the remainder of the Lease Term following the date of termination discounted to present value as of the date of termination at the rate of six percent (6%) per annum, minus (B) the then present fair rental value of the Premises for such period, similarly discounted. For the purposes of the immediately preceding clause (B), "fair rental value" shall not exceed seventy-five percent (75%) of the amount determined under clause (A).
The trial court rendered judgment awarding Willowbrook actual damages against BMB in the amount of $42,752.73 in unpaid rent and other amounts accrued under the Lease plus $557,821.00 in liquidated damages, and $550,000.00 against RCI for actual damages. The trial court also awarded Willowbrook $298,438.34 in trial attorney's fees, plus $65,000.00 in conditional appellate attorney's fees.Pursuant to the final judgment, BMB and RCI are jointly and severally liable for both fee awards.
The parties agreed to submit the issue of attorney's fees to the bench.
The trial court also awarded Willowbrook pre- and post-judgment interest.
The trial court rendered a take-nothing judgment against BMB on its counterclaims and third-party claims against Willowbrook I Shopping Center L.L.C. and Leon Vahn. The trial court also denied BMB's and RCI's motions for JNOV and for a new trial. This appeal followed.
BMB and RCI are not challenging this portion of the trial court's judgment on appeal.
Jury's Findings Regarding Future Rent Due and Fair Rental Value
In its first issue, BMB argues that the trial court erred by disregarding the jury's findings of $0 in response to Question 5.4A concerning the total amount of future rent BMB would have been required to pay under the Lease for the remainder of its term and substituting a finding of $557,821, based solely on an unenforceable liquidated damages provision in the Lease. Specifically, BMB argues that the trial court erred by substituting the jury's damages finding with its own because there were inherent fact issues appropriate only for a jury to resolve, the amount of future rent owed to Willowbrook was disputed, and the evidence did not support the trial court's damages finding. BMB further contends that the trial court "erroneously ignored the jury's finding in answer to Question 5.4B, [regarding the fair rental value of the Premises] which is a necessary finding for determining the amount of future rent owed, if any."
Because the trial court relied on the liquidated damages provision of the Lease in setting aside the jury's findings and awarding damages to Willowbrook under Question 5.4, we begin our analysis by addressing the enforceability of the Lease's liquidated damages provision.
A. Enforceability of Liquidated Damages Provision
An enforceable liquidated damages contract provision establishes an "acceptable measure of damages that parties stipulate in advance will be assessed in the event of a contract breach." Atrium Med. Ctr., LP v. Houston Red C LLC, 595 S.W.3d 188, 192 (Tex. 2020) (quoting Flores v. Millennium Interests, Ltd., 185 S.W.3d 427, 431 (Tex. 2005)). Courts enforce liquidated damages provisions when (1) "the harm caused by the breach is incapable or difficult of estimation," and (2) "the amount of liquidated damages called for is a reasonable forecast of just compensation." Phillips v. Phillips, 820 S.W.2d 785, 788 (Tex. 1991); see also Atrium Med. Ctr., 595 S.W.3d at 192. When applying these first two rules, known as the Phillips prongs, courts examine the circumstances at the time the agreement is made. See Atrium Med. Ctr., 595 S.W.3d at 192; see also FPL Energy, LLC v. TXU Portfolio Mgmt. Co., L.P., 426 S.W.3d 59, 69-70 (Tex. 2014) (stating courts must evaluate both prongs from perspective of parties at time of contracting). "The party seeking liquidated damages bears the burden of showing that the provision, as drafted, accounts for these two considerations." See Atrium Med. Ctr., 595 S.W.3d at 192.
A facially valid and enforceable liquidated damages provision, however, may still operate as an unenforceable penalty due to unanticipated events arising during the life of a contract. See id. at 192-93 ("Liquidated damages must not be punitive, neither in design nor operation."); see also Phillips, 820 S.W.2d at 788. Thus, courts must also determine whether "'the actual damages incurred were much less' than the liquidated damages imposed, measured at the time of the breach." Atrium Med. Ctr., 595 S.W.3d at 193; see also Phillips, 820 S.W.2d at 788. In other words, even if a liquidated damages provision satisfies the Phillips prongs, when there is an "unbridgeable discrepancy" between the provision as written and the reality of its application, the provision cannot be enforced. FPL Energy, 426 S.W.3d at 72. The breaching party challenging the liquidated damages provision must demonstrate this "unbridgeable discrepancy." Atrium Med. Ctr., 595 S.W.3d at 193.
Whether a liquidated damages provision is a penalty is a legal question, but its resolution may require a court to resolve certain factual issues first. Id. at 195. We apply a de novo review when evaluating whether a contractual liquidated damages provision is enforceable or void. See FPL Energy, 426 S.W.3d at 70.
BMB argues that the liquidated damages provision in Section 17.2(a) of the Lease is unenforceable because it fails to satisfy the Phillips prongs, results in the imposition of damages bearing no relationship to Willowbrook's actual damages, and eliminates Willowbrook's duty to mitigate.
1. Phillips Prong: Incapable or Difficult to Estimate
With respect to the first Phillips prong, BMB contends that the harm caused by its purported breach was not incapable or difficult to estimate at the time the parties executed the Lease. According to BMB, there are accepted methods experts use to calculate the fair market rental value of commercial property, such as performing a present value calculation using the rental value of comparable properties.
Although Sikes and Dominy generally agreed about the proper method for calculating the fair market rental value of the Premises, they disagreed about which properties to use as proper comparators and the calculation of the fair rental value of the Premises. Indeed, each expert offered a different and wide-ranging fair rental value calculation, illustrating the potential difficulty in estimating the harm resulting from a potential future breach of the Lease.
Moreover, potential damages resulting from a breach are not simply the amount of rent lost, but also may include other potential costs such as reletting the property, broker fees, repairing any damage to the property, bringing the property back to blank canvas status, and the intangible cost of a property siting vacant for an undeterminable period. As Willowbrook points out, it is not possible to anticipate when a breach will occur during a 10-year commercial lease like the one in this case, much less what the market conditions will be when the breach occurs, how long it will take to find a suitable replacement tenant to sign a lease or what the rent and other terms of the replacement lease will be. The parties presented trial testimony that it could take anywhere from six months to three years to find a replacement tenant.
Given the length of the Lease and the difficulty of forecasting market conditions for commercial real estate properties, we find that "the harm caused by the breach [was] incapable or difficult of estimation" at the time the Lease was executed. The liquidated damages provision thus satisfies the first prong of Phillips.
2. Phillips Prong: Reasonable Forecast of Just Compensation
Relying on Magill v. Watson, 409 S.W.3d 673 (Tex. App.-Houston [1st Dist.] 2013, no pet.) and Phillips v. Phillips, 820 S.W.2d 785 (Tex. 1991), BMB contends that the liquidated damages provision is unenforceable because it fails to satisfy the second Phillips prong. BMB contends that the amount of liquidated damages called for under Section 17.2(a) of the Lease is not "a reasonable forecast of just compensation" because it guarantees that BMB will always have to pay a minimum of 25% of the total future rent due under the remaining term of the Lease as liquidated damages.
BMB's reliance on Phillips and Magill is misplaced. The liquidated damages provision in Phillips required the breaching party to pay the other a "multiple of actual damages." Phillips, 820 S.W.2d at 789; see also Atrium Med. Ctr., 595 S.W.3d at 195-96. Similarly, this Court held in Magill that a provision requiring a breaching party to pay three times the amount of earnest money for failure to sign a release acceptable to an escrow agent was an unlawful penalty because it made no attempt to quantify actual damages, but "instead assume[d] that the earnest money, which the parties have agreed will constitute actual damages for breach of the agreement in general, should be trebled and added to the earnest money" in the event of breach. Magill, 409 S.W.3d at 680. We further held that the provision was unenforceable because the plaintiff's actual damages had resulted from the defendants' failure to close on the transaction at issue and not the failure to release the earnest money. See id. at 680-81.
Specifically, the liquidated damages provision in Magill stated: "Any party who wrongfully fails or refuses to sign a release acceptable to the escrow agent ... will be liable to the other party for liquidated damages in an amount equal to the sum of (i) three times the amount of the earnest money, (ii) the earnest money; (iii) reasonable attorney's fees; and (iv) all costs of suit." 409 S.W.3d at 679.
Unlike the unenforceable provisions in Phillips and Magill, the liquidated damages provision in the Lease attempts to quantify actual damages based on one key component of Willowbrook's breach of contract damages-the amount of rent it was entitled to collect from BMB under the Lease for the remainder of its term, discounted to present value. It then reduces that recoverable amount by the present fair rental value of the Premises. Thus, far from penalizing or extracting an unrelated damage number, the liquidated damage provision attempts to calculate "a reasonable forecast of just compensation."
The provision at issue here also does not require the breaching party to pay more than its actual damages under all circumstances. We further note that there is nothing inherently unreasonable about setting a minimum amount of damages based on outstanding rent obligations. As the Texas Supreme Court has explained, "[t]he parties are expected to negotiate a reasonable-not perfect-forecast of just compensation." Atrium Med. Ctr., 595 S.W.3d at 195. Furthermore, "there is a backstop against a forecast that is inordinate when compared with actual damages: proof of a large variance will render a provision unenforceable." Id.
3. Difference Between Liquidated and Actual Damages
Because the liquidated damages provision is reasonable on its face, BMB "must present evidence from which the court may find that an 'unbridgeable discrepancy' exists between actual and liquidated damages." Id. at 197-98. BMB argues that the amount of liquidated damages in this case ($557,821) is ten times its actual damages as found by the jury, and thus, bears no rational relationship to the amount of Willowbrook's actual damages. BMB relies on the jury's findings under Question 5.4A and 5.4B to advance its calculation of actual damages. It argues that the total amount of future rent due under the Lease for the remainder of its term and the fair rental value of the Premises is $0, leaving Willowbrook with a recovery of only $42,752.73 in accrued past rent.
As discussed below, there is no evidence supporting the jury's finding of $0 in response to Question 5.4A. On the contrary, the evidence conclusively established that the total amount of future rent owed under the Lease for the remainder of its term was $2,231,284. We thus hold that BMB has not demonstrated that there is an "unbridgeable discrepancy" between liquidated and actual damages, measured at the time of the breach, as required to invalidate an otherwise valid liquidated damages provision. See id. at 192; cf. FPL Energy, 426 S.W.3d at 72 (holding "unacceptable disparity" between damages assessed under contract of approximately $29 million and actual damages of approximately $6 million made liquidated damages provision unenforceable).
4. Duty to Mitigate
BMB further contends that even if the liquidated damages provision is not a penalty, it is nevertheless void and unenforceable because it essentially eliminates Willowbrook's duty to mitigate its damages. BMB, however, does not establish why or how mitigation applies to the calculation of liquidated damages under Section 17.2(a) of the Lease. Willowbrook has a statutory and contractual duty to mitigate its damages and nothing with respect to the way liquidated damages are calculated impacts Willowbrook's mitigation obligations.
Moreover, although "courts must consider mitigation when determining whether actual damages diverge significantly from liquidated damages," the party alleging that a liquidated damages provision is an unenforceable penalty has the burden "to show how much actual damages were reduced, or could have been reduced, by mitigation." Atrium Med. Ctr., 595 S.W.3d at 197. BMB did not offer testimony concerning the amount of damages BMB presumably could have avoided through proper mitigation, an issue on which it had the burden of proof.
The jury was instructed, in connection with Questions 5 and 7, that in "arriving at an amount, if any, you are instructed not to not [sic] include in your answer any amount that you find could have been avoided with the exercise of reasonable care."
Nonetheless, BMB argues that the jury implicitly found that Willowbrook failed to mitigate its damages by answering $0 in response to Question 5.4. According to BMB, the jury presumably found that Willowbrook could have avoided the loss of the entire $2,231,284 in total future rent. The Lease makes it clear, however, that Questions 5.4A and 5.4B, as presented to the jury, were mere calculations of the present value of the total future rent due under the Lease for the remainder of its term and the fair rental value of the Premises consistent with the Lease's liquidated damages provision. As BMB admits, neither expert offered testimony concerning any reduced amounts for these values based on any alleged failure to mitigate, much less the amount of the alleged remaining rent.
BMB argues that Willowbrook should have taken reasonable steps to lease the Premises sooner. When asked how long it should have taken Willowbrook to re-let the Premises, Brant Widener, Willowbrook's broker, testified, "[a]bout a year and a half." He also testified that he would expect the Premises to be vacant for one and a half to three years and that Vahn, Willowbrook's owner, generally included a six-month free rent period in his leases like the one included in BMB's Lease. Dominy, BMB's expert, opined that six to twelve months would be a reasonable time frame to re-let the Premises. Dominy also testified that the free rent period was typically for six months, but he had seen some for as long as one year.
No one testified that Willowbrook should have been able to re-let the Premises before BMB's monthly rental payments became due in June 2015. At most, there was some evidence that Willowbrook could have avoided some of its damages stemming from the loss of BMB's future rent payments by exercising reasonable care and re-letting the property sooner. There is no evidence, however, that Willowbrook could have avoided all of these damages, and as noted, BMB did not offer any evidence concerning the value of any alleged damages resulting from any failure to mitigate. See id. at 197 ("The burden remains on the party seeking to prove that the liquidated damages provision is an unenforceable penalty to show how much actual damages were reduced, or could have been reduced, by mitigation."); see also Cole Chem. & Distrib., Inc. v. Gowing, 228 S.W.3d 684, 688 (Tex. App.-Houston [14th Dist.] 2005, no pet.) ("[W]here a defendant proves failure to mitigate but not the amount of damages that could have been avoided, it is not entitled to any reduction in damages.).
The Lease provides that the Lease is to commence on the date BMB opens for business or 180 days after Willowbrook tenders the Premises. Vahn testified that Willowbrook delivered exclusive possession of the Premises to BMB effective December 4, 2014.
We thus hold that the liquidated damages provision is enforceable. We now consider whether the trial court erred by disregarding the jury's findings under Question 5.4 and awarding Willowbrook $557,821 in liquidated damages.
B. Disregarding Jury Findings
"A trial court may disregard a jury finding only if it is unsupported by evidence or if the issue is immaterial." Graves v. Tomlinson, 329 S.W.3d 128, 147 (Tex. App.-Houston [14th Dist.] 2010, pet. denied); see Spencer v. Eagle Star Ins. Co. of Am., 876 S.W.2d 154, 157 (Tex. 1994). A question is immaterial when it calls for a finding beyond the province of the jury, such as a question of law, or the question should not have been submitted. Se. Pipe Line Co. v. Tichacek, 997 S.W.2d 166, 172 (Tex. 1999). "A trial court may properly disregard a jury's finding of fact where the evidence supporting the finding is legally insufficient." Bufkin v. Bufkin, 259 S.W.3d 343, 353 (Tex. App.-Dallas 2008, pet. denied).
A trial court is authorized to disregard a jury's damages findings and to substitute its own judgment of the proper measure of damages only if the evidence conclusively proves the damages sought by the movant. See Galvan v. Garcia, 502 S.W.3d 382, 386 (Tex. App.-San Antonio 2016, no pet.); Ginn v. NCI Building Sys., Inc., 472 S.W.3d 802, 844 (Tex. App.-Houston [1st Dist.] 2015, no pet.). "Evidence is conclusive only if reasonable people could not differ in their conclusions . . . ." City of Keller v. Wilson, 168 S.W.3d 802, 816 (Tex. 2005); see also Int'l Bus. Machines Corp. v. Lufkin Indus., LLC, 573 S.W.3d 224, 235 (Tex. 2019) (stating that, to conclusively establish fact, "the evidence must leave 'no room for ordinary minds to differ as to the conclusion to be drawn from it'") (quoting Triton Oil & Gas Corp. v. Marine Contractors & Supply, Inc., 644 S.W.2d 443, 446 (Tex. 1982)).
Questions 5.4A and 5.4B asked the jury to make factual findings necessary to calculate liquidated damages afforded under the Lease. Article 17.2(a) of the Lease allows Willowbrook to recover, among other damages,
(iii) Liquidated Damages in an amount equal to (A) the total Rent that Tenant would have been required to pay for the remainder of the Lease Term following the date of termination discounted to present value as of the date of termination at the rate of six percent (6%) per annum, minus (B) the then present fair rental value of the Premises for such period, similarly discounted. For the purposes of the immediately preceding clause (B), "fair rental value" shall not exceed seventy-five percent (75%) of the amount determined under clause (A).
Question 5.4A, which asked the jury to determine "the total Rent that [BMB] would have been required to pay under the Lease Agreement for the remainder of the Lease Term following the date of termination discounted to present value as of the date of termination," corresponds with Article 17.2(a)(iii)(A). And Question 5.4B, which asked the jury to determine "the fair rental value of the Premises, as of the date of termination, to the end of the Lease Term, discounted to present value," corresponds with Article 17.2(a)(iii)(B). Thus, based on the jury's answers to Question 5.4A and 5.4B, the trial court would be able to calculate the amount of liquidated damages to be awarded under the Lease.
Even though BMB argues in its brief that the amount of future rent due under the Lease was disputed, it concedes that Willowbrook's expert testified that the discounted present value of future rent due under the Lease for the duration of its term was $2,231,284. Specifically, as to Question 5.4A, Sikes testified that the value of rent BMB would have been required to pay under the remaining Lease term at termination, discounted to present value, was $2,231,284. BMB's expert, Dominy, did not dispute Sikes's testimony on this point. Thus, the only value presented to the jury in connection with Question 5.4A was $2,231,284. Notwithstanding, the jury answered $0 to Question 5.4A. The jury also answered $0 in response to Question 5.4B, which asked the jury to determine the present fair rental value of the Premises for the duration of the Lease. It did so even though the parties presented only two competing fair rental value calculations: (1) $2,231,284 for BMB, and (2) $1,931,612 for Willowbrook.
Question 5.4B did not ask the jury to perform a mathematical equation or to deduct its finding of fair rental value from the total amount of future rent due under the Lease. Rather, it asked the jury to determine the fair rental value of the Lease. There was no evidence that the fair rental value was $0.
Willowbrook filed a motion for entry of judgment requesting that the trial court disregard the jury's finding of $0 in response to Question 5.4A and award Willowbrook $557,821 in liquidated damages. Although it did not expressly request that the trial court disregard the jury's answer to Question 5.4B (the fair rental value of the premises), BMB argues such a request is necessarily implied by Willowbrook's request for $557,821.00 in liquidated damages pursuant to the Lease.
Willowbrook calculated the requested liquidated damages figure using the following equation:
Discounted Future Rent (DFR) - $2,231,284 00
Minus DFR * 75 - $(1.073.463.00)
Liquated Damages S557.821.00
The trial court could not have awarded Willowbrook $557,821.00 in liquidated damages unless it disregarded the jury's finding that "the fair rental value of the Premises, as of the date of termination, to the end of the Lease Term, discounted to present value" was zero and substituted a finding of $1,673,463.00 for Question 5.4B, applying the 75% cap in the Lease (i.e., 75% of $2,231,284). Although the parties disagreed about the exact amount of the fair rental value of the Premises, the evidence conclusively demonstrates that only two values were presented to the jury, and both exceeded the 75% cap set forth in the Lease: $1,673,463.00. Thus, under either scenario, the capped fair rental value of the Premises would apply resulting in the same resulting capped figure-$1,673,463.00. The trial court did not err in using this value to determine liquidate damages.
This number represents 25% of $2,231,284-the undisputed total future rent due under the Lease for the duration of its terms, discounted to present value.
BMB further argues that the trial court erred by disregarding the jury's finding under Question 5.4 because the question and the evidence raised fact issues appropriate only for a jury to resolve. A trial court, however, may disregard a jury finding that is not supported by the evidence and as previously discussed, there is no evidence supporting the jury's finding of zero in response to Question 5.4. See Enright v. Goodman Distribution, Inc., 330 S.W.3d 392, 403 (Tex. App.-Houston [14th Dist.] 2010, no pet.) ("A jury may not arbitrarily assess an amount not authorized or supported by evidence at trial; in other words, a jury many not 'pull figures out of a hat.'").
We thus conclude that the trial court did not err by disregarding the jury's finding under Question 5.4 and awarding Willowbrook liquidated damages.
We overrule BMB's first issue.
RCI's Liability under the Guaranty
In its second issue, RCI argues that there is legally and factually insufficient evidence supporting the jury's findings that (1) RCI breached the Guaranty, and (2) RCI's purported breach caused Willowbrook to incur $550,000 in damages.
A. Standard of Review and Applicable Law
In a legal sufficiency, or no-evidence review, we determine whether the evidence would enable reasonable and fair-minded people to reach the verdict under review. See City of Keller, 168 S.W.3d at 827. In conducting this review, we credit favorable evidence if a reasonable factfinder could, and we disregard contrary evidence unless a reasonable factfinder could not. Id. We consider the evidence in the light most favorable to the finding and indulge every reasonable inference that would support it. Id. at 822. "If there is any evidence of probative force to support the finding, i.e., more than a mere scintilla, we will overrule the issue." City of Houston v. Hildebrandt, 265 S.W.3d 22, 27 (Tex. App.- Houston [1st Dist.] 2008, pet. denied) (citing Haggar Clothing Co. v. Hernandez, 164 S.W.3d 386, 388 (Tex. 2005)). When a party attacks the legal sufficiency of an adverse finding on which it did not have the burden of proof, it must demonstrate that there is no evidence to support the adverse finding. Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983).
To successfully challenge the factual sufficiency of an adverse finding on an issue on which the challenging party bears the burden of proof, the party "must demonstrate on appeal that the adverse finding is against the great weight and preponderance of the evidence." Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001). We consider and weigh all the evidence and uphold the challenged finding unless "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.
A guaranty is a promise to a creditor by a third party to pay a debt on behalf of a principal if the principal defaults on the original obligation. See Republic Nat'l Bank of Dallas v. Nw. Nat'l Bank of Fort Worth, 578 S.W.2d 109, 114 (Tex. 1978); Chahadeh v. Jacinto Med. Group, P.A., 519 S.W.3d 242, 246 (Tex. App.-Houston [1st Dist.] 2017, no pet.). To support a claim for breach of a guaranty, a party must establish (1) the existence and ownership of a guaranty contract, (2) the terms of the underlying contract by the holder, (3) occurrence of the conditions upon which liability is based, and (4) failure or refusal to perform by the guarantor. Chahadeh, 519 S.W.3d at 246. A guarantor's liability is measured by the principal's liability unless a more extensive or more limited liability is expressly provided for in the guaranty. W. Bank-Downtown v. Carline, 757 S.W.2d 111, 113 (Tex. App.- Houston [1st Dist.] 1988, writ denied). RCI argues that there is no evidence of the fourth element, i.e., that RCI failed or refused to perform its obligations under the Guaranty.
RCI is only challenging whether Willowbrook presented sufficient evidence of this fact. RCI is not challenging the sufficiency of the evidence supporting any other element of the claim.
B. Charge
Question 11 asked the jury, "Did RCI fail to comply with the Guaranty?" The jury answered "yes." Question 12 asked the jury to determine "[w]hat sum of money, if any, if paid now in cash, would fairly and reasonably compensate Willowbrook for its damages, if any, that resulted from RCI's failure to comply with the Guaranty." The jury was instructed that it could consider only "[t]he Rent and other amounts due in connection with or under the Lease Agreement during the first three full years of the Lease Term" when determining the amount of Willowbrook's damages.
C. Analysis
RCI, BMB's parent company, executed the Guaranty with Willowbrook in connection with the Lease. The Guaranty states in pertinent part:
Guarantor [RCI] hereby unconditionally, absolutely and irrevocably guarantees to Landlord [Willowbrook] for the first (1st) three (3) full years of the Lease, the following: (i) the prompt payment when due of the Rent (as defined in the Lease) and all other sums due in connection with or under the Lease, and (ii) to pay on demand any and al1 costs, expenses, and fees (including, without limitation, counsel fees and disbursements) incurred by Landlord in enforcing any rights under this Guaranty (collectively, the "Obligations").
The Lease commenced on December 4, 2014 and BMB's first rent payment was due June 2, 2015, 180 days later. BMB paid the first month's rent in advance when it signed the Lease. BMB's second rent payment was due on or before July 1, 2015, and the third payment was due on or before August 1, 2015.
After BMB failed to pay its rent for July and August, Willowbrook sent BMB and RCI a demand letter on August 13, 2015, in which Willowbrook demanded payment of $48,064.97 in outstanding rent, and other fees under the Lease within five days. Willowbrook stated that "failure and refusal [to pay within the five-day period] shall be an Act of Default by [BMB] under the Lease." Although BMB and RCI were given an opportunity to cure BMB's failure to pay rent, Vahn testified that Willowbrook did not receive payment of all sums due under the Lease as demanded.
On August 21, 2015, Willowbrook sent BMB and RCI a "Notice of Lease Termination, Notice of Termination of Right to Possession, Acceleration of Rent, and Demand for Liquidated Damages" in which it, among other things, demanded payment of all damages and amounts due under Section 17.2(a) of the Lease within five days. Specifically, the notice states in pertinent part that Willowbrook was accelerating all rent due under the Lease and demanding that BMB and RCI pay all damages identified in Article 17.2(a) of the Lease.
The testimony of Eric Langan, president of BMB and president and chief executive officer of RCI, confirms that RCI did not pay any of BMB's obligations under the Lease. Langan testified that he believed Willowbrook had breached the Lease in April 2015 when it informed him that BMB would never be able to expand the patio. When asked about the Guaranty, Langan testified that he did not believe that RCI owed Willowbrook anything under the Guaranty after Willowbrook terminated the Lease. According to Langan, RCI only guaranteed the prompt payment of the first three years of rent when payment became due. Langan explained, "And so basically on August 10th [2015], when [Willowbrook] terminated the lease, they terminated [BMB's] rights to the lease. And under my understanding, that terminates the parent company's guarantee because then no rents become due because it's not rent anymore. . . Now, it's a liquidated damage. And we did not guarantee liquidated damages or termination fees or anything else. We only guaranteed the rents and other associated fees of the rents as they became due." Contrary to Langan's understanding, the plain language of the Guaranty states that RCI guaranteed "the prompt payment when due of the Rent (as defined in the Lease) and all other sums due in connection with or under the Lease" for the first three years of the Lease. Rent, as defined in Article 3.1 of the Lease, includes "[a]ll other sums and charges of whatsoever nature required to be paid by [BMB] to [Willowbrook] pursuant to the terms of this Lease." Willowbrook accelerated all future rent payments due under the Lease in August 2015 and demanded payment for sums due under the Lease and Guaranty, including liquidated damages, and never received payment.
Considering the evidence in the light most favorable to the adverse finding, as we must, and indulging every reasonable inference supporting the jury's finding, we conclude there is legally sufficient evidence supporting the jury's finding that RCI failed to comply with its Guaranty obligations. See City of Keller, 168 S.W.3d at 822. Furthermore, we cannot say that the jury's finding "is so weak" or "so against the great weight and preponderance of the evidence that it is clearly wrong and unjust." Dow Chem. Co., 46 S.W.3d at 242.
RCI's argument that there is insufficient evidence supporting the jury's finding that Willowbrook sustained $550,000 in damages for RCI's alleged breach of the guaranty is also unavailing. The jury heard testimony that the rent and other amounts due in connection with or under the Lease during the first three years of the Lease ranged from $42,752.73 (the amount due in unpaid rent prior to termination) to $1,459,908.21 (the total for all Willowbrook's purported damages caused by BMB's breach of the Lease). The jury's finding that Willowbrook sustained $550,000 in damages for RCI's alleged breach of the guaranty is well within the range of damages presented as trial. See Hertz Equip. Rental Corp. v. Barousse, 365 S.W.3d 46, 57 (Tex. App.-Houston [1st Dist.] 2011, pet. denied) (stating that for purposes of legal and factual sufficiency review, factfinder has discretion to award damages within range of evidence presented at trial, so long as rational basis exists for its calculation); see also Gulf States Utils. Co. v. Low, 79 S.W.3d 561, 566 (Tex. 2002) ("In determining damages, the [factfinder] has discretion to award damages within the range of evidence presented at trial"). As long as "a rational basis for the calculation of damages exists, a jury's finding will not be disregarded merely because its reasoning in arriving at its figure may be unclear." Pleasant v. Bradford, 260 S.W.3d 546, 559 (Tex. App.-Austin 2008, pet. denied).
We overrule RCI's second issue.
Offset
In its third issue, BMB argues that the trial court erred by not reducing the amount of damages, costs, and fees BMB purportedly owed to Willowbrook by the present value of the FEXY lease ($1,037,769.23) pursuant to Article 17.5(e) of the Lease.
In construing a written contract, a court "must ascertain the true intentions of the parties as expressed in the writing itself." Italian Cowboy Partners, Ltd. v. Prudential Ins. Co. of Am., 341 S.W.3d 323, 333 (Tex. 2011). We examine and consider the entire writing in an effort to harmonize and give effect to all of the provisions of the contract so that none will be rendered meaningless. Id. We begin our analysis with the contract's express language. Id. And we analyze the provisions of a contract "with reference to the whole agreement." Frost Nat'l Bank v. L & F Distribs., Ltd., 165 S.W.3d 310, 312 (Tex. 2005); see also Seagull Energy E & P, Inc. v. Eland Energy, Inc., 207 S.W.3d 342, 345 (Tex. 2006) ("No single provision taken alone will be given controlling effect; rather, all the provisions must be considered with reference to the whole instrument."). "Contract terms are given their plain, ordinary, and generally accepted meanings unless the contract itself shows them to be used in a technical or different sense." Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 662 (Tex. 2005). "We construe contracts 'from a utilitarian standpoint bearing in mind the particular business activity sought to be served' and 'will avoid when possible and proper a construction which is unreasonable, inequitable, and oppressive.'" Frost Nat'l Bank, 165 S.W.3d at 312 (quoting Reilly v. Rangers Mgmt., Inc., 727 S.W.2d 527, 530 (Tex. 1987)).
Article 17.5(e) of the Lease states in pertinent part:
All rent and other consideration paid by any replacement tenants shall be applied, at Landlord's option: first, to the Cost of Reletting, second, to the payment of any indebtedness other than Rent due hereunder, third, to the payment of all costs of enforcing this Lease against Tenant or any guarantor, fourth, to the payment of all interest and service charges accruing hereunder, fifth, to the payment of Rent theretofore accrued. . . .
The plain language of this provision makes clear that only payments made by a replacement tenant to Willowbrook may be applied to reduce the amount of BMB's financial obligations under the Lease, and only so "at Landlord's option." See Italian Cowboy Partners, Ltd., 341 S.W.3d at 333 (stating that when construing written contracts, courts "must ascertain the true intentions of the parties as expressed in the writing itself"). The Lease does not extend this offset to the present value of any replacement lease or to payments Willowbrook expects to receive from a replacement tenant in the future.
At the time of trial, Willowbrook's replacement tenant, FEXY, had not made any rental payments to Willowbrook and therefore, there was no rental amount received that Willowbrook could have used as an offset pursuant to Article 17.5(e). Accordingly, we hold that the trial court did not err in failing to reduce the amount of damages, costs, and fees BMB purportedly owed to Willowbrook by the present value of the FEXY lease.
We overrule BMB's third issue.
Attorney's Fees
In their fourth issue, BMB and RCI argue that the trial court abused its discretion by awarding Willowbrook attorney's fees.
A. Standard of Review and Applicable Law
We review a trial court's award of attorney's fees under an abuse of discretion standard. See Ridge Oil Co., Inc. v. Guinn Invs., Inc., 148 S.W.3d 143, 163 (Tex. 2004); Avila v. Larrea, 506 S.W.3d 490, 494 (Tex. App.-Dallas 2015, pet. denied). A trial court abuses its discretion if it acts without reference to guiding rules and principles. Avila, 506 S.W.3d at 494. A trial court, however, does not abuse its discretion when its ruling is based on conflicting evidence and some evidence of substantive and probative character supports its decision. Unifund CCR Partners v. Villa, 299 S.W.3d 92, 97 (Tex. 2009).
Generally, a party seeking attorney's fees must segregate fees for recoverable claims from those for which they are not, and also segregate fees owed by different parties. See Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 311 (Tex. 2006). Texas law, however, recognizes an exception to fee segregation "when discrete legal services advance both a recoverable and unrecoverable claim" and thus "are so intertwined that they need not be segregated." Id. at 313-14. Whether it is necessary to segregate attorney's fees is a question of law, but the extent to which certain claims can or cannot be segregated is a mixed question of law and fact. Id. at 312- 13.
B. Attorney's Fees Provisions and Evidence
The trial court awarded Willowbrook $298,438.34 in attorney's fees and $65,000 in conditional appellate attorney's fees. The fees were assessed jointly and severally against BMB and RCI.
The award of attorney's fees in this case is based on contractual provisions in the Lease and Guaranty. See Epps v. Fowler, 351 S.W.3d 862, 865 (Tex. 2011) (citing Intercontinental Grp. P'ship v. KB Home Lone Star L.P., 295 S.W.3d 650, 653 (Tex. 2009) (stating that Texas litigants can only recover attorney's fees if statute or contract specifically provides for such recovery)). Section 17.4 of the Lease states:
Upon any Act of Default, Tenant shall pay to Landlord all costs and expenses incurred by Landlord, including court costs and reasonable attorneys' fees, in (a) retaking or otherwise obtaining possession of the Premises, (b) removing and storing Tenant's or any other occupant's property, (c) repairing, cleaning, painting, restoring, altering, remodeling or otherwise putting the Premises into condition acceptable to a new tenant or tenants, (d) reletting all or any part of the Premises and brokers' fees incurred by Landlord in connection with reletting the whole or any part of the Premises, (e) paying or performing the underlying obligation which Tenant failed to pay or perform, and (f) enforcing any Landlord's rights, remedies and recourses arising as a consequence of the Act of Default.
Similarly, the Guaranty states, in pertinent part, that RCI guarantees to Willowbrook "to pay on demand any and all costs, expenses, and fees (including without limitation counsel fees and disbursements) incurred by Landlord in enforcing any rights under this Guaranty."
In support of its application for attorney's fees, Willowbrook submitted an affidavit from its counsel, George Gibson ("Gibson"), along with approximately fifty pages of invoices and an exhibit identifying deductions in fees for unrecoverable work performed for Willowbrook. In his affidavit, Gibson provides a summary of the legal services his firm provided, assesses the reasonableness and necessity of the fees using the Arthur Anderson factors, and discusses the adjustments he made to his firm's billing invoices and his reasons for doing so. Specifically, Gibson averred in his affidavit that, "Before submitting and delivering invoices to Willowbrook, the attorneys wrote off hours that were arguably duplicative, unproductive, or otherwise unnecessary."
Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 818 (Tex. 1997) (identifying factors courts should consider when determining reasonableness of fees, including time and labor required, fee customarily charged in locality for similar legal services, amount involved and results obtained, experience, reputation, and ability of lawyer or lawyers performing services).
With respect to the need to segregate fees, Gibson further averred,
Nevertheless, I have segregated out certain items of work identified as nonrecoverable based on the above analysis. Such segregation is shown in Exhibit 3 to this affidavit. For some items I have identified specific line items in the invoices that would be nonrecoverable. I have also taken into account that there is some work that could be partially nonrecoverable and partially recoverable and I have therefore placed a percentage factor that allocates a certain portion of our fees as nonrecoverable. The defense of the claims asserted by Defendants was inextricably intertwined with the issues associated with enforcing the contract, but since there may be some minor issues that do not overlap, I have allocated 5% of the attorney's fees as unrecoverable for this reason. These allocations are based upon my education, training, experience, and knowledge of how the issues in this case played out and represent my opinion, based on reasonable certainty, of the amount of work done that would be nonrecoverable.
Exhibit 3 reflects that the 5% deduction is equal to $15,194.91 and the total amount of unrecoverable fees is $20,459.91.
Although BMB and RCI filed a response to Willowbrook's application for attorney's fees, BMB and RCI did not present any contradictory evidence.
C. Segregation of Fees
BMB and RCI argue that the trial court abused its discretion by awarding Willowbrook its attorney's fees because Willowbrook failed to segregate the fees owed by RCI from those owed by BMB. They further contend that it was particularly necessary for Willowbrook to do so in this case because BMB and RCI were being sued on claims related to two separate contracts, the Lease and the Guaranty. According to BMB and RCI, "Willowbrook's case focused almost entirely on BMB, and it developed very little evidence about enforcing the guaranty agreement. But Willowbrook made no effort to segregate its fees as between RCI and BMB, even though it sued these defendants on separate contracts."
Although they are separate agreements, the parties' rights and obligations under the Lease and the Guaranty are significantly intertwined. For example, the Guaranty requires RCI to pay "Rent (as defined by the Lease) and all other sums due in connection with or under the Lease." The "other sums due in connection with or under the Lease" include Willowbrook's reasonable attorney's fees in "enforcing any of [Willowbrook]'s rights, remedies and recourses arising as a consequence of the Act of Default." Thus, RCI is liable for reasonable attorney's fees incurred by Willowbrook in enforcing its rights under the Guaranty, as well as under the Lease.
Furthermore, Article 26.14 of the Lease expressly states that Willowbrook's obligations under the Lease were conditioned upon BMB obtaining the Guaranty from RCI, which is attached to the Lease and "made a part hereof for all purposes simultaneously with [BMB's] execution of this Lease." Article 26.14 further states that "if there is a default by [RCI] under the Guaranty, such default shall constitute an Act of Default by [BMB] under the Lease without further notice to [BMB]." As with any other Act of Default under the Lease, BMB is required to "pay to Landlord all costs and expenses incurred by Landlord, including court costs and reasonable attorneys' fees, in . . . enforcing any of Landlord's rights, remedies and recourses arising as a consequence of the Act of Default."
Given the interrelated nature of the agreements and BMB's and RCI's obligations as set forth above, we conclude that Willowbrook's fees associated with the enforcement of its rights under the Lease and the Guaranty are so intertwined that they need not be segregated. See Chapa, 212 S.W.3d at 313-14.
BMB's and RCI's argument that Willowbrook did not segregate its fees incurred to enforce its rights under the Lease or Guaranty from fees for its work defending against BMB's counterclaims is also unavailing. "[W]hen a defendant asserts a counterclaim that the plaintiff must overcome in order to fully recover on its contract claim, the attorney's fees necessary to defeat that counterclaim are likewise recoverable." 7979 Airport Garage, L.L.C. v. Dollar Rent A Car Sys., Inc., 245 S.W.3d 488, 507 (Tex. App.-Houston [14th Dist.] 2007, pet. denied) (citing Varner v. Cardenas, 218 S.W.3d 68, 70 (Tex. 2007)). Therefore, Willowbrook was not required to segregate the fees necessary to prosecute its claims against BMB and RCI from the fees necessary to defend against BMB's counterclaims. See 7979 Airport Garage, L.L.C., 245 S.W.3d at 507.
Although it was not required to do so, we note that Willowbrook's counsel specifically discounted the total intertwined fees by a percentage to account for any potential unrecoverable fees: "The defense of the claims asserted by Defendants was inextricably intertwined with the issues associated with enforcing the contract, but since there may be some minor issues that do not overlap, I have allocated 5% of the attorney's fees as unrecoverable for this reason."
D. Reasonableness of Attorney's Fees
BMB and RCI also argue that Willowbrook failed to demonstrate that the amount of its requested fees was reasonable because its billing invoices were vague and the billing records reflected that "substantial unnecessary work was performed," such as the fact that two attorneys attended a deposition. A "reasonable" award of fees "is not excessive or extreme, but rather moderate or fair." Sullivan v. Abraham, 488 S.W.3d 294, 299 (Tex. 2016). The reasonableness of a fee award rests within the trial court's discretion. Id. When determining the reasonableness of a fee, the court should consider the factors identified in Arthur Andersen, including the time and labor required, the fee customarily charged in the locality for similar legal services, the amount involved and the results obtained, the experience, reputation, and ability of the lawyer or lawyers performing the services. Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 818 (Tex. 1997). The court need not receive evidence on each of these factors, but may look at the entire record, the evidence presented on reasonableness, the common knowledge of the participants as lawyers and judges, and the relative success of the parties. In re A.B.P., 291 S.W.3d 91, 98 (Tex. App.-Dallas 2009, no pet.).
Willowbrook presented evidence of the reasonableness of its fees through the affidavit of its counsel, Gibson. After discussing the applicability of all the Arthur Andersen factors, Gibson opined that Willowbrook's reasonable and necessary attorney's fees equaled $308,438.34. The trial court then reduced that amount by an additional $10,000 and awarded Willowbrook $298,438.34 in attorney's fees.
BMB's and RCI's argument that the trial court should have reduced the amount further because Willowbrook "only partially" prevailed by recovering only a portion of the $1.4 million in damages it sought is not persuasive. The jury found that (1) BMB breached the Lease, (2) BMB's breach was not excused, (3) BMB had unclean hands, (4) RCI breached the Guaranty, and (5) Willowbrook did not breach the Lease. And, as previously discussed, the trial court properly rendered judgment awarding Willowbrook $600,573.73 in actual damages against BMB and $550,000.00 against RCI. The reduced attorney's fee award of $298,438.34, for which RCI and BMB are jointly and severally liable, is approximately half the amount of damages awarded against RCI and BMB individually. Cf. Bencon Mgmt. & Gen. Contracting, Inc. v. Boyer, Inc., 178 S.W.3d 198, 209-10 (Tex. App.- Houston [14th Dist.] 2005, no pet.) (affirming award of $282,000 in attorney's fees, two times more than actual damages recovered).
In light of the foregoing, we cannot say that the trial court abused its discretion by awarding Willowbrook $298,438.34 in attorney's fees.
We overrule BMB's and RCI's fourth issue.
Conclusion
We affirm the trial court's judgment.