Opinion
No. 05-15-01443-CV
06-07-2017
IN THE INTEREST OF A.N.Z., A CHILD
On Appeal from the 256th Judicial District Court Dallas County, Texas
Trial Court Cause No. DF-09-16380-Z
MEMORANDUM OPINION
Before Justices Evans, Stoddart, and Boatright
Opinion by Justice Stoddart
This appeal involves the award of attorney's fees under an agreement incorporated into the parties' divorce decree. Mother filed a motion to modify Father's child support. Father later filed a counter-motion seeking to eliminate his child-support obligation. After a hearing on the motions, the trial court terminated Father's child-support obligation, denied Mother's request for attorney's fees, and awarded Father attorney's fees. Mother appeals the award of attorney's fees to Father and the denial of her request for attorney's fees. Concluding the trial court erred in its award of attorney's fees, we reverse the award and remand the case for further proceedings on that issue.
BACKGROUND
The divorce decree includes the following provision at issue in this appeal (Fee Provision):
Further, the Court finds that the parties agree not to seek modification of the child support amount contained herein (other than the step-down) for so long as child support is due and payable under the terms of this Agreed Final Decree of Divorce. While the parties acknowledge such agreement may not be enforceable as an order of the Court, the parties agree to and shall be contractually bound by this agreement. IT IS ORDERED that in the event either party files for modification of [FATHER'S] child support obligation, the filing party shall be responsible for payment of one hundred percent (100%) of the other party's attorney's fees and costs incurred in defending such suit, regardless of the outcome of the case.
In January 2014, approximately three years after the divorce decree, Mother filed a petition to modify parent-child relationship seeking, among other things, to increase Father's child-support obligation under the decree. Father filed an answer and counterclaim seeking his attorney's fees under the Fee Provision. Mother answered the counterclaim and sought her own attorney's fees.
In January 2015, Father filed a counter-motion seeking to modify the parent-child relationship to eliminate his child-support obligation. He also requested to be named as the person with the right to designate the child's primary residence and that Mother be ordered to pay child support.
On May 7, 2015, the issue of modifying conservatorship of the child was tried to a jury. Enforcement proceedings and other matters were heard by the trial court during jury deliberations. No testimony or evidence on attorney's fees was offered before the jury or on the record at the hearing. However, a few days after the hearing, both parties filed briefs regarding the Fee Provision and summaries of their respective attorney's fees, attaching redacted billing statements from their attorneys. After Mother filed a written objection to his business record affidavit, Father filed an amended brief and summary of his attorney's fees that subtracted fees for the enforcement proceedings.
On September 1, 2015, the trial court signed an order in the suit to modify parent-child relationship. The trial court granted Mother's motion in part and addressed other matters not at issue in this appeal. The trial court ordered that Mother and Father remain joint managing conservators for the child, and that "no child support is payable at this time by either conservator but that each conservator shall be responsible for supporting the child while she is in that conservator's possession." The trial court awarded Father his attorney's fees and denied all other relief requested, including Mother's request for fees.
Mother requested findings of fact and conclusions of law on the issue of the attorney's fees awarded to Father. She also filed a motion to reform the judgment regarding the award of attorney's fees. The trial court signed findings of fact and conclusions of law and denied Mother's motion to reform the judgment.
STANDARD OF REVIEW
In general, we review an award of attorney's fees authorized by contract or statute under an abuse of discretion standard. Bocquet v. Herring, 972 S.W.2d 19, 20 (Tex. 1998). We review questions of law, such as the interpretation of an unambiguous contract, de novo. See In re B.N.L.-B., 375 S.W.3d 557, 564 (Tex. App.—Dallas 2012, no pet.). Fact findings, such as the amount and reasonableness of attorney's fees, are reviewed under a sufficiency of the evidence standard of review. See Smith v. Patrick W.Y. Tam Trust, 296 S.W.3d 545, 547 (Tex. 2009) (reasonableness of attorney's fees is ordinarily left to factfinder); Bocquet, 972 S.W.2d at 21 (reasonableness and necessity normally fact questions for factfinder); Sharifi v. Steen Auto., LLC, 370 S.W.3d 126, 152 (Tex. App.—Dallas 2012, no pet.) (amount of attorney's fees reviewed for legal and factual sufficiency). Findings of fact in a non-jury case are reviewed under the same sufficiency standards as jury findings. Sanders v. Total Heat & Air, Inc., 248 S.W.3d 907, 912 (Tex. App.—Dallas 2008, no pet.). We review the trial court's conclusions of law de novo. See BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789, 794 (Tex. 2002).
DISCUSSION
In her first issue, Mother contends there is no evidence in the record to support a finding that the amount of fees awarded to Father was reasonable and necessary for his defense of her motion to modify his child-support obligation.
Mother contends that although the Fee Provision does not require that attorney's fees be "reasonable and necessary," such terms are implied in the agreement. Father does not argue otherwise. We agree. "An agreement to pay an unspecified amount of attorney's fees implies payment of a reasonable fee for the attorney's services." In re B.N.L.-B., 375 S.W.3d at 566; see also Girard Fire & Marine Ins. Co. v. Koenigsberg, 65 S.W.2d 783, 785 (Tex. Civ. App.—Dallas 1933, no writ) ("Where the parties do not expressly agree as to the amount, the law raises a promise to pay that which is reasonable."); Kurtz v. Kurtz, 158 S.W.3d 12, 18 & n.6 (Tex. App.—Houston [14th Dist.] 2004, pet. denied) (conclusion that contract for attorney's fees impliedly means contract for reasonable attorney's fees is consistent with disciplinary rules of professional conduct governing attorney's fee arrangements with clients).
The amount of reasonable and necessary attorney's fees for either party was not tried to the jury or to the trial court at an evidentiary hearing. The record does not contain an agreement to stipulate to the reasonableness and necessity of the fees shown on the billing statements or to submit those matters to the court without evidence. See TEX. R. CIV. P. 11 (no agreement between attorneys is enforceable unless written, signed, and filed with the clerk or announced in open court on the record). Therefore, evidence of reasonableness and necessity, as well as segregation, of the attorney's fees was required. See Bocquet, 972 S.W.2d at 21 (reasonableness and necessity of attorney's fees is a fact question); Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 818 (Tex. 1997) (discussing factors for determining reasonableness and necessity of attorney's fees); Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 313-14 (Tex. 2006) (discussing segregation requirement).
The record is unclear as to how the parties and the trial court decided to determine the issue of attorney's fees. After the jury returned its verdict, the parties informed the court they had submitted briefs on recovery of fees under the Fee Provision, but neither party had submitted actual evidence of attorney's fees. Counsel asked how the court wished to determine the amount of attorney's fees. It appears there was an unrecorded bench conference at this point, but there is no record of an agreement or ruling on presentation of evidence of the amount and reasonableness of attorney's fees.
Although Father filed an affidavit authenticating his attorneys' redacted billing statements as business records, he offered no testimony by an attorney or other expert as to the reasonableness or necessity of the fees related to the defense of Mother's motion to modify child support. The reasonableness and necessity of attorney's fees is a fact issue and its proof requires expert testimony. See Bocquet, 972 S.W.2d at 21; Twin City Fire Ins. Co. v. Vega-Garcia, 223 S.W.3d 762, 770 (Tex. App.—Dallas 2007, pet. denied). Further, the Fee Provision permits recovery of fees only for defending a motion to modify Father's child-support obligation. The billing statements, which are cryptic and heavily redacted, show fees for several matters, including the jury trial on the conservatorship issues, unrelated to the defense of Mother's motion for modification of child support. But Father offered no evidence limiting his fees to that issue or showing that fees incurred on these other matters served to advance the defense of the child support issue. See Chapa, 212 S.W.3d at 313-14 (segregation is not required only when discrete legal services advance both a recoverable and unrecoverable claims).
Father argues on appeal that the trial court could take judicial notice of the usual and customary attorney's fees under section 38.004 of the civil practice and remedies code. TEX. CIV. PRAC. & REM. CODE ANN. § 38.004 (court may take judicial notice of usual and customary attorney's fees and contents of case file where amount of attorney's fees is submitted to the court by agreement). The usual and customary attorney's fees for a claim described in section 38.001 are presumed reasonable. Id. § 38.003. However, Father sought attorney's fees specifically under the Fee Provision. He did not request attorney's fees pursuant to section 38.001, and the trial court's findings indicate the court awarded attorney's fees under the Fee Provision, not section 38.001. TEX. R. CIV. P. 299 (findings of fact filed by trial court form basis of judgment upon all grounds of recovery and defense embraced therein). Because Father asserted his claim for attorney's fees under the Fee Provision and not section 38.001, the trial court could not take judicial notice under section 38.004. Ahrenhold v. Sanchez, 229 S.W.3d 541, 544 (Tex. App.—Dallas 2007, no pet.); Charette v. Fitzgerald, 213 S.W.3d 505, 514-15 (Tex. App.—Houston [14th Dist.] 2006, no pet.) (parties that did not seek or obtain attorney's fees under section 38.001 could not rely on sections 38.003 and 38.004 to "bridge the gap left by the lack of evidence of the reasonableness of their attorney's fees").
However, there is some evidence Father incurred attorney's fees in defending Mother's motion to modify child support and at least some portion of those fees would be reasonable and necessary. See Chapa, 212 S.W.3d at 314; In re B.N.L.-B., 375 S.W.3d at 566-67. Thus, while there is legally sufficient evidence of Father's attorney's fees, the evidence is factually insufficient to support the trial court's finding of the amount of reasonable and necessary attorney's fees for defending Mother's motion. Therefore, a remand is required. Chapa, 212 S.W.3d at 314; In re B.N.L.-B., 375 S.W.3d at 566-67. We sustain Mother's first issue to this extent.
In her second issue, Mother contends the trial court abused its discretion by denying her request for attorney's fees.
The Fee Provision is an agreement contained in a divorce decree. It is treated as a contract and is controlled by the rules of ordinary contract construction. Beshears v. Beshears, 423 S.W.3d 493, 500 (Tex. App.—Dallas 2014, no pet.).
We agree with the trial court's conclusion of law that the Fee Provision is unambiguous. See Coker v. Coker, 650 S.W.2d 391, 393 (Tex. 1983) (contract is ambiguous if its meaning is uncertain or it is reasonably susceptible to more than one interpretation). We disagree, however, with the trial court's application of the Fee Provision's unambiguous terms. The parties agreed "not to seek modification of the child support amount" contained in the divorce decree. They also agreed, "In the event either party files for modification of [Father's] child support obligation, the filing party shall be responsible for payment of one hundred percent (100%) of the other party's attorney's fees and costs incurred in defending such suit, regardless of the outcome of the case."
Under the clear meaning of these terms, the obligation to pay fees is not limited to the first party to file a motion to modify child support. The Fee Provision states that if "either party" moves to modify child support, the "filing party" shall pay the "other party's" attorney's fees incurred in defending the matter, "regardless of the outcome" of the motion. The triggering event under this provision is not the outcome of the motion, but the filing of a motion by "either party." See Intercontinental Grp. P'ship v. KB Home Lone Star L.P., 295 S.W.3d 650, 653 (Tex. 2009) (noting that triggering event under contractual attorney's fees provision was prevailing on an action to enforce the terms of the contract or declare rights thereunder). The record conclusively shows that both Mother and Father filed motions seeking to modify Father's child-support obligation. Therefore, both Mother and Father are filing parties under the Fee Provision and responsible for paying the other party's attorney's fees incurred in defending the respective motion to modify child support regardless of the outcome of the motions. Thus, the payment obligation under the Fee Provision was triggered by both parties and the trial court abused its discretion by denying Mother's request for attorney's fees. We sustain Mother's second issue.
Because a remand is necessary, we note that the Fee Provision permits recovery of fees only for defending a suit for modification of child support. Thus, any award of fees should be limited, based on the evidence, to those fees incurred in defending the other party's motion to modify Father's child-support obligation, unless the evidence indicates such fees also advanced matters on which fees are otherwise unrecoverable. See Chapa, 212 S.W.3d at 314.
CONCLUSION
We conclude there is insufficient evidence to support the amount of reasonable and necessary attorney's fees awarded to Father. We further conclude that, under the terms of the Fee Provision, both Mother and Father are filing parties seeking to modify Father's child-support obligation. Therefore, the trial court abused its discretion by denying Mother's request for attorney's fees. We reverse the award of attorney's fees in the trial court's order modifying the parent-child relationship and remand the determination of the attorney's fees to the trial court for further proceedings consistent with this opinion. 151443F.P05
/Craig Stoddart/
CRAIG STODDART
JUSTICE
JUDGMENT
On Appeal from the 256th Judicial District Court, Dallas County, Texas
Trial Court Cause No. DF-09-16380-Z.
Opinion delivered by Justice Stoddart. Justices Evans and Boatright participating.
In accordance with this Court's opinion of this date, the award of attorney's fees to Marla Pittman and the law firm of Friedman & Feiger, LLP in the trial court's September 1, 2015 order in suit to modify parent-child relationship is REVERSED and this cause is REMANDED to the trial court for further proceedings.
It is ORDERED that each party bear its own costs of this appeal. Judgment entered this 7th day of June, 2017.