CHRISTOPHER ANTCLIFF, Justice.
Approach Resources I, L.P. ("Approach") appeals the trial court's judgment denying its request for attorney's fees under the Texas Uniform Declaratory Judgment Act. Approach raises six issues for this Court's review. Issues One through Five contain Approach's analysis of the trial court's failure to award its requests for attorney's fees, which the entity characterizes as an abuse of discretion. In Issue Six, Approach requests that this Court exercise its authority to reform the underlying judgment to correct a clerical error. Affirmed as reformed.
This case is before the Court for a second time, following remand for reconsideration of attorney's fees in light of our opinion in Thompson v. Clayton, 346 S.W.3d 650, 657 (Tex.App.-El Paso 2009, no pet.). In the first appeal ("Clayton I"), we were asked, in part, to review the trial court's summary judgment in favor of property owner Ms. Elizabeth Clayton regarding the viability of a letter agreement entered into by Ms. Clayton's father in 1975.
On appeal, this Court concluded that the 1975 letter agreement remained in effect, and provided Mr. J. Cleo Thompson, James Cleo Thompson, Jr., L.P., Wes-Tex Drilling Company, and Approach (collectively, "the declaratory judgment defendants"), a valid easement on Ms. Clayton's property. See id. at 656-57. The easement permitted the declaratory judgment defendants to build and maintain a road across Ms. Clayton's ranch so that they could access oil drilling equipment on neighboring property. See id. As a result, the summary judgment was reversed and the case was remanded, "to the trial court for reconsideration of attorney's fees." See id. at 657.
On remand the trial court conducted an additional hearing, and requested additional evidence and argument from the parties regarding attorney's fees. During the hearing, the trial court expressed its concern that any fees awarded should relate only to the litigation surrounding the validity of the 1975 letter agreement, and should not include fees related to any other causes of action pending in the case. To assist the court in understanding the
According to Mr. Millican, in addition to the work related to the validity of the 1975 letter agreement, he also represented Ms. Clayton relative to her claims for damages to the surface of her property caused by the defendant's activities, as well as during negotiations for a separate agreement governing the defendants' use of the road on her property. Mr. Millican testified that independent of the easement validity dispute, the parties mediated a settlement for Ms. Clayton's claim for surface damages related to what he characterized as breaches of the 1975 agreement. He explained further:
Ms. Clayton testified, without objection, that her father entered into the 1975 letter agreement to permit the owners of an adjacent ranch, to cross the Clayton property to pursue development of minerals. Ms. Clayton's father passed away in 2003. By that time, Approach was producing minerals from both the adjacent property, and the Clayton Ranch directly. While the continued effectiveness of the 1975 letter agreement was still in dispute, Ms. Clayton and some of the declaratory judgment defendants attempted to negotiate a new agreement to govern the use of the road. While the new agreement was never fully executed, the new negotiations led Ms. Clayton to believe that the 1975 agreement was no longer enforceable. Ms. Clayton explained that just prior to the time Mr. Thompson contacted her to begin negotiating a new road agreement, Approach began drilling a new mineral well on the neighboring property. Mr. Thompson also approached Ms. Clayton for permission to allow a geological team to cross the property, via the road, to conduct a seismic study on the adjacent ranch. To Ms. Clayton's knowledge, the geological team was forced to use an alternative route to access the adjacent property when the parties failed to finalize the new road agreement.
Approach continued to use the road to access its wells on the adjacent property, as well as to conduct drilling operations on the Clayton Ranch. During this time, Ms. Clayton testified, Approach caused damage to her property by failing to drain their collection pits properly, leaving pools of oil on the property. These damages led to a separate dispute with Approach over the company's alleged misuse of the surface in its development of the minerals. In the summer of 2005, Approach offered to compensate Ms. Clayton for the surface damages in exchange for her permission to continue to use the road for access to its wells on the adjacent ranch. According to her testimony, Ms. Clayton refused to accept Approach's payment because she believed Approach was not complying with the terms of 1975 agreement. According to Ms. Clayton, Approach violated the terms of her father's agreement in three
Ms. Clayton filed the underlying lawsuit in September 2005.
Following Ms. Clayton's testimony, the trial court advised the parties that they had until April 15, 2010, approximately six weeks from the date of the hearing, to submit their evidence and any additional arguments regarding attorney's fees. The court ordered the parties to segregate their claims for attorney's fees. J. Cleo Thompson, James Cleo Thompson, Jr., L.P., and Wes-Tex Drilling Company (collectively "Thompson") filed a joint motion for recovery of attorney's fees, with supporting evidence, on April 1, 2010. Thompson argued that segregation of attorney's fees was not appropriate given the inter-relatedness of the claims. In the alternative, Thompson submitted evidence, in the form of an affidavit by Attorney Pat Long Weaver, in which Ms. Weaver, again argued that the fees were not subject to segregation, but went on to state:
Approach filed its own motions and supporting evidence on April 7 and 13, 2010. In its motions, Approach argued that due to the nature of Ms. Clayton's claims, its attorney's fees could not be segregated. In addition to other exhibits, Approach submitted over one hundred pages of invoices, billing statements, and payment receipts as provided by its attorneys, and an affidavit sworn to by one of those attorneys, Mr. Michael E. McElroy. Approach did not segregate, or attempt to segregate, any of the fees claimed, and requested an award of $249,510.30, for services through the appeal in Clayton I.
Ms. Clayton's attorney, Mr. Paul H. Millican, filed an affidavit on April 14, 2010, representing that Ms. Clayton's fees totaled $239,140.24. Mr. Millican segregated the fees by claim, and requested an award of $53,515.56 for Ms. Clayton's declaratory judgment claim. The fees related to the remaining causes of action, were segregated on the basis that they were resolved in mediation, or that there was no legal basis for recovery.
The trial court entered its judgment on May 25, 2010. The court awarded J. Cleo Thompson, and James Cleo Thompson, Jr., L.P. $34,000, recoverable from Ms. Clayton. The judgment states: "All other relief as to attorney fees is DENIED." Following the entry of judgment, the trial court provided detailed findings of fact and conclusions of law. The following findings are relevant to the issues before this Court:
This appeal is premised on Approach's conclusion that the trial court abused its discretion by failing to award attorney's fees in response to the entity's request under the Texas Uniform Declaratory Judgments Act. The Texas Uniform Declaratory Judgments Act (UDJA) provides the trial court with discretion to award reasonable and necessary attorney's fees, in an amount that is just and equitable. See TEX.CIV.PRAC. & REM.CODE ANN. § 37.009 (West 2008); Murphy v. Long, 170 S.W.3d 621, 628 (Tex.App.-El Paso 2005, pet. denied). The award is not dependent on a finding that the party prevailed in the action, and in its discretion, the trial court may decline to award fees to either party. See Barshop v. Medina Cty. Underground Water Conservation Dist., 925 S.W.2d 618, 637-38 (Tex.1996).
Issue One presents Approach's foundational abuse of discretion argument. In Issues Two through Five, Approach presents additional arguments related to specific instances which it contends demonstrate the trial court abused its discretion by refusing to award fees. Combined, the specific question to be determined in this case is whether the trial court abused its discretion by concluding that any attorney's fee award would run afoul of the "equitable and just" standard required by the UDJA.
A trial court's decision to grant or deny attorney's fees will not be disturbed absent an abuse of discretion. Bocquet v. Herring, 972 S.W.2d 19, 21 (Tex.1998). In conducting an abuse of discretion review, this Court will view the evidence in the light most favorable to the trial court's ruling, and indulge every presumption in its favor. Aquaduct, L.L.C. v. McElhenie, 116 S.W.3d 438, 444 (Tex.App.-Houston [14th Dist.] 2003, no pet.). A trial court abuses its discretion when it acts in an arbitrary or unreasonable manner, without reference to guiding rules and principles of law. Goode v. Shoukfeh, 943 S.W.2d 441, 446 (Tex.1997).
Appellate review of an attorney's fee award under the Uniform Declaratory Judgment Act requires a multi-faceted analysis. See Transcontinental Ins. Co. v. Crump, 330 S.W.3d. 211, 231 (Tex.2010). The reasonableness and necessity of the fee amount are fact questions. See Ridge Oil Co., Inc. v. Guinn Investments, Inc., 148 S.W.3d 143, 162-63 (Tex.2004). Determining whether to award fees, or how much of an award is equitable and just in a given case, are questions committed to the trial court's discretion because of the nature of the issue. Ridge Oil Co., Inc., 148 S.W.3d at 161-62. Whether it is "equitable and just" to award attorney's fees depends, not on direct proof, but on the concept of fairness, in light of all the circumstances of the case. Id. at 162. As such, although a fact finder may determine
This distinction was addressed by the Texas Supreme Court in Ridge Oil Co., Inc. In that case, the Supreme Court was asked to determine whether a trial court's decision to award only part of the fees which the jury had determined to be reasonable and necessary constituted an abuse of discretion. Ridge Oil Co., Inc., 148 S.W.3d at 161. Recognizing the distinction between the jury's fact-finding duty on the reasonable and necessary prong, and the trial court's role in crafting a just and equitable award, the Court explained:
Ridge Oil Co., Inc., 148 S.W.3d at 162.
According to the opinion there was, "no indication in the record that the judge's decision was arbitrary or unreasonable," and the reduced fee award was upheld. See Ridge Oil Co., Inc., 148 S.W.3d at 163.
Although the reasonableness and necessity issue was determined by stipulation of the parties in this case, rather than by a jury, we see little distinction between this case and the circumstances in Ridge Oil Co., Inc. As in Ridge Oil Co., Inc., the reasonableness and necessity of the fees requested by the parties was not in dispute. The only issue remaining for the trial court to determine what award, if any, would be equitable and just. While the equities balanced toward only a reduced award in Ridge Oil Co., Inc., the Supreme Court recognized that, as a general matter, the court had the discretion to refuse to award fees, if an award of any amount would be inequitable and unjust. See Ridge Oil Co., Inc., 148 S.W.3d at 162. Such is the circumstance we must consider here. Both implicitly, and according to the court's findings of fact and conclusions of law, the court determined that it would not be equitable or just to award attorney's fees to Approach.
In Issues Two, Three, and Four, Approach identifies three grounds on which it relies to demonstrate that the award falls outside the limits of the court's discretion. Issue Two addresses what Approach characterizes
First turning to the waiver argument presented in Issue Two, we disagree with Approach's characterization of the court's finding. Approach frames this argument in a way that would lead one to conclude that the trial court refused to award fees because Approach "waived" its right to recovery. Read in isolation, finding twenty-one could be construed to indicate that the court determined Approach's right to recovery had been waived, without regard to the requirements of the UDJA. The finding was not made in isolation, however, and pursuant to the abuse of discretion standard of review, this Court is charged to consider the record broadly with deference to the trial court's ruling. See Bocquet, 972 S.W.2d at 21.
Even if we limit our view of the record, and look only to the court's fact-findings, the context indicates that the "waiver" identified by the court was a waiver of an opportunity to present evidence, not "waiver" of a right to recovery. Within the language of finding twenty-one itself, the court first notes that Approach "waived its right to provide attorneys-fee evidence at trial," and then continues by noting that the entity also failed to "prove its attorneys' fees related to the issues appealed on remand." There is no indication of a cause-and-effect relationship between the two statements, and we see no reason to impose one. Approach's over-broad interpretation of finding twenty-one is not supported by the record, and cannot support a finding that the trial court abused its discretion in failing to award fees. In light of this conclusion, there is no need to address Approach's alternative challenge to the legal and factual sufficiency of the evidence supporting the finding. Issue Two is overruled.
In Issue Three, Approach contends that the trial court erroneously concluded that fee segregation was necessary in this case, and concluded that the court abused its discretion by refusing to award fees due to Approach's failure to segregate. As Approach explains, generally, fee claimants are required to segregate attorney's fees between claims for which fees are recoverable, and claims for which they are not. See Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 313 (Tex.2006). A claimant is relieved of the duty to segregate only in circumstances where the same "discrete legal services advance both a recoverable and unrecoverable claim." See Chapa, 212 S.W.3d at 313-14. Under such circumstances, the fees are considered to be too "intertwined" for segregation to be possible. See Chapa, 212 S.W.3d at 313-14. Whether or not segregation is necessary is a question of law, subject to de novo review. Penhollow Custom Homes,
While we do not disagree with Approach's statement of the standards for segregation, we question how the issue is related to the court's determination that an award would not be just and equitable. Segregation is not an equitable issue. It is related to the amount of attorney's fees which are recoverable by a party. See Chapa, 212 S.W.3d at 313-14. It is a tool used to separate fees expended to advance claims for which recovery of attorney's fees is not authorized, from those that are permitted pursuant to statute or contract. See id. at 311, 313-14. Approach has not provided this Court with citation to authority, and we are unaware of Texas case law which applies the segregation standard to support or defeat a trial court's decision under the "equitable and just" standard.
The central issue here is the court's decision to refuse to award fees at all. Because segregation is an issue directed toward the amount of fees to be recovered, it has little or no impact on the trial court's determination that the only just and equitable resolution was to refuse Approach's request for fees. Given the independence of the two issues, there is no need to address Approach's assertion that segregation was not appropriate in this case. In addition, in light of our analysis it is not necessary to address Approach's legal and factual sufficiency challenge to the trial court's conclusion that segregation was required in this case. Issue Three is overruled.
In Issue Four, Approach contends that the trial court abused its discretion by considering issues which were outside the "scope of the remand," and by using findings related to those issues to refuse to award fees. Ms. Clayton presented a great deal of evidence as to Approach's actions prior to, and during the appeal in Clayton I, as well as testimony demonstrating the nature of the entity's use of her property. During the presentation of evidence, only counsel for the Thompson defendants objected to Ms. Clayton's testimony on the basis that it was irrelevant to the issues the court was charged to consider on remand. There is nothing in the record indicating that Approach objected to the trial court's consideration of the evidence proffered by Ms. Clayton during the hearing, or in its motion for recovery of attorney's fees.
To preserve a complaint for appellate review the complaining party must raise a valid, specific, and timely objection in the trial court. See TEX. R.APP.P. 33.1(a); Equistar Chems., L.P. v. Dresser-Rand Co., 240 S.W.3d 864, 868 (Tex.2007). Failure to raise a complaint in the trial court waives appellate review of the issue. See McIntyre v. Wilson, 50 S.W.3d 674, 688 (Tex.App.-Dallas 2001, pet. denied). Because this argument was not presented in the trial court, it has not been preserved for consideration by this Court. Issue Four is overruled.
With regard to Issue Five, according to the "ISSUES PRESENTED" page of Approach's brief, this issue challenges the legal and factual sufficiency of the evidence supporting the court's findings, "on issues on which Clayton had the burden of proof," and asserts that, any adverse findings on which Approach had the burden of proof, "are not supported under the matter of law and great weight and preponderance standards." There is no further discussion of this issue in the brief however. Without further analysis, we will overrule Issue Five for lack of briefing. See TEX. R.APP.P. 38.1(i).
In Issue Six, Approach notes that there is a discrepancy between the cause number
Having overruled Issues One through Five, and sustained Issue Six, the trial court's judgment is affirmed as reformed.