JANE BLAND, Justice.
Crossed wires caused an on-site electrical transformer to blow, necessitating repairs and the use of a temporary transformer
We conclude that (1) most of the damages the jury awarded are direct damages, but the damages relating to loss of use are consequential damages, (2) the jury charge is proper, (3) HP did not establish the full amount of its damages as a matter of law and thus is not entitled to an increased award, (4) the jury's take-nothing award for appellate attorney's fees is not supported by legally sufficient evidence, and (5) in light of our reduction of HP's damages, the jury's award for attorney's fees at trial must also be remanded. We therefore reverse the trial court's judgment with respect to the award of damages pursuant to the jury findings on damage elements (d) and (e), relating to costs for loss of use, and reform the judgment accordingly. We reverse the trial court's judgment with respect to the award of attorney's fees at trial and on appeal and remand those issues. We affirm the trial court's judgment in all other respects.
HP owns a manufacturing facility in Houston with its own power substation. The substation uses a two-transformer system to power the facility. Powell designs, manufactures and installs electrical equipment. HP contracted with Powell to perform breaker retrofitting services at the substation. This process required Powell to remove breaker cables from the transformers' breaker cabinets and then reconnect them when the work was completed. Powell failed to document how the breaker cables were placed before removing them and unintentionally crossed certain breaker cables when it reconnected them. The cross-phased breaker cables caused one of HP's dual transformers, transformer B, to fail. As a result, HP incurred costs to repair transformer B and to obtain a temporary transformer for use while the repairs were made. HP brought this suit against Powell to recover for these costs.
After a trial on the merits, the jury found in favor of HP on its breach of contract and breach of express warranty claims against Powell, awarding HP $926,585.98 in damages and $163,526.24 for attorney's fees. The damages awarded by the jury included the following elements:
Powell contends that the trial court erred in denying Powell's motions to disregard the jury finding on damages. Powell argues that the damages found by the jury are consequential damages, which are barred under the terms of the parties' contract. HP responds that the damages are direct damages, rather than consequential damages. The parties agree that their contract bars consequential damages but not direct damages.
The dispute between the parties is whether the damages awarded in this case constitute direct or consequential damages under Texas law. We review such questions of law de novo. In re Humphreys, 880 S.W.2d 402, 404 (Tex.1994); Harris Cnty. Appraisal Dist. v. Wilkinson, 317 S.W.3d 763, 766 (Tex.App.-Houston [1st Dist.] 2010, pet. denied). Likewise the interpretation of unambiguous contracts is a legal question that we review de novo. MCI Telecomms. Corp. v. Tex. Utils. Elec. Co., 995 S.W.2d 647, 650-51 (Tex.1999); Atlantic Lloyds Ins. Co. v. Butler, 137 S.W.3d 199, 209 (Tex.App.-Houston [1st Dist.] 2004, pet. denied).
Direct damages are those damages that flow naturally and necessarily from the breach. Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 816 (Tex.1997) (emphasis added). "Direct damages compensate for the loss, damage, or injury that is conclusively presumed to have been foreseen or contemplated by the party as a consequence of his breach of contract or wrongful act." Id. "By definition, if particular damages are specifically accounted for in the contract, they are direct, not consequential, in nature." McKinney & Moore, Inc. v. City of Longview, No. 14-08-00628-CV, 2009 WL 4577348, *5 (Tex.App.-Houston [14th Dist.] Dec. 8, 2009, pet. denied) (mem. op.) (citing Boyer, Inc. v. Trinity River Auth. of Tex., 279 S.W.3d 354, 358 (Tex.App.-Fort Worth 2008, pet. denied));
Examples of direct damages can be found in our decision in Tennessee Gas Pipeline. In that case, a pipeline owner, Tennessee Gas Pipeline ("TGP"), sought to recover damages for Technip's delayed and defective construction work on a pipeline. Tennessee Gas Pipeline, 2008 WL 3876141, at *8. The parties' contract precluded recovery of consequential damages, and we reviewed the various categories of damages awarded to determine which damages were consequential damages and which were direct. Id. at *8-10. We concluded that various "project delay costs"—including costs for labor, travel, environmental contractors, inspectors, purchase and supply of additional construction consumables, wastewater hauling, services and utilities—were direct damages, because the contract contained a provision requiring TGP to provide power during construction. Id. at *8-9. On this basis, we concluded that Technip contemplated that its construction delay would naturally and necessarily cause TGP's power costs to be extended over a longer period of time. Id.; see also McKinney & Moore, Inc., 2009 WL 4577348, at *5.
"Consequential damages" are those which result naturally, but not necessarily, from the breach. Arthur Andersen, 945 S.W.2d at 816 (emphasis added); see Stuart v. Bayless, 964 S.W.2d 920, 921 (Tex.1998). Consequential damages are recoverable only if they are foreseeable and directly traceable to the wrongful act and result from it. Stuart, 964 S.W.2d at 921; Basic Capital Mgmt., Inc. v. Dynex Commercial, Inc., 348 S.W.3d 894, 901 (Tex.2011) (quoting Stuart).
Tennessee Gas Pipeline also provides examples of consequential damages. We held that TGP could not recover for the cost of renting a backup generator after a power outage occurred, which TGP asserted would not have been necessary but for Technip's premature dismantling of the existing backup generator before the new generator was fully operational. Tennessee Gas Pipeline, 2008 WL 3876141, at *9-10. We concluded that the power outage and need for a backup generator could not be conclusively presumed to have been foreseen by the parties as a consequence of Technip's breach. Id. We also precluded as consequential damages TGP's alleged losses relating to (1) lost efficiency from the extended use of the old compressor rather than the new compressor, (2) lost investment returns on funds tied up during the delay, (3) costs incurred as a penalty under TGP's contract with the utility company for delayed commencement of utilities use, and (4) lost profits on gas that TGP was unable to sell because it had to be used for venting and to perform emergency shutdowns. Id. at 10-11.
We conclude that some of the damages awarded to HP are permitted direct damages and some are impermissible consequential damages.
Damages that flow "naturally and necessarily" from a breach of the parties' contract are those inherent in the
Here, the damages to transformer B are inherent in the nature of the breach of Powell's contractual and warranty obligations to HP. Powell's re-energizing of transformer B while the B-side breakers were cross-phased caused transformer B to fail, and the failure of transformer B necessitated its testing, removal, oil disposal, repair and reinstallation. No additional link in the causal chain was necessary to bring about the injury or damages. The parties can be "conclusively presumed to have foreseen" that Powell's substandard performance would result in the failure of the transformer and that failure of a transformer would require HP to incur costs associated with repairing it. Cf. Arthur Andersen, 945 S.W.2d at 816.
We are not persuaded otherwise by Powell's argument that direct damages in this case should be limited to the cost of uncrossing the wrongfully crossed cables or the difference between the value of Powell's actual services and the value of the services as promised by Powell. As an initial matter, contrary to Powell's narrow construction of the contract, the subject of the contract is Powell's "Electrical Contractor work for [HP] related to the Willow Substation 34.5KV Breaker Retrofit," which the evidence shows necessarily included temporarily unhooking the breaker cables from transformer B's breaker cabinet and then putting them back. This does not appear to have been disputed at trial, and Powell's own employee averred that "[t]he scope of the Powell/HP contract included the unlanding and relanding of the feeder cables to the circuit breakers."
The contract expressly contemplates that testing and repair costs may be incurred as a result of defective performance by Powell.
To support its contention that HP's damages should be limited, Powell relies on Reynolds Metals Co. v. Westinghouse Electric Corp., 758 F.2d 1073 (5th Cir. 1985). The dispute in Reynolds arose out of a contract between Westinghouse and Reynolds for the purchase and installation of a transformer at Reynolds's facility in Corpus Christi, Texas. Id. at 1074. The transformer had a design defect, which caused internal burning; additionally, Westinghouse improperly installed the transformer's system for the detection of ground current. Id. The internal burning caused the transformer to fail. Id. at 1075. The improperly installed detection system contributed to the problem by not alerting Reynolds of the problem prior to the transformer's failure. Id. At the time of trial, Reynolds had two claims against Westinghouse: (1) breach of warranty, based on the defect in the transformer and (2) breach of contract, based on the improper installation of the ground current detection system. Id. at 1076-77. The district court entered a directed verdict on the warranty claims on the basis of the applicable statutes of limitations, and the jury found in Reynolds' favor on the breach of contract claim. Id. at 1078-79. The trial court entered judgment on the jury's award for the cost of repairing the transformer but excluded damages for lost profits and the costs of transporting the transformer to and from Houston for repairs as consequential damages, which were precluded under the parties' contract. Id. at 1078-79. On appeal, Westinghouse argued that the cost of repairs were also consequential damages excluded under the contract. Id. at 1079. The Fifth Circuit agreed, holding that the proper measure of damages in that case was the difference in the value of what was promised under the contract and what was actually delivered—the measure of damages that would apply to a sale of goods under Chapter 2 of the Texas Business and Commerce Code (the "UCC"). Id. at 1079-80 (citing TEX. BUS. & COM.CODE ANN. § 2.714 (West 2009)).
Powell asserts that Reynolds stands for the proposition that anything other than the difference in value between what was bargained for and what was received
The measure of damages used in Reynolds would not properly compensate HP under the circumstances of this case, where Powell's breach of the contract and its warranties were the direct cause of HP's damages. We hold that HP's costs of repair to the unit that Powell serviced and destroyed are direct damages resulting from Powell's breach.
Powell suggests that all of HP's damages constitute "loss of use" damages and are therefore consequential. While HP's costs relating to the repair of transformer B are not loss of use damages, HP's decision to install a temporary transformer and use it while transformer B was being repaired are lost use damages. Like lost profits, lost use damages are frequently, but not categorically, consequential in nature. See Tennessee Gas Pipeline, 2008 WL 3876141 at *8, 10 (holding that provision barring recovery of consequential damages did not necessarily bar all loss of use damages but damages for loss of use of money were consequential). Here, we conclude that HP's costs relating to the temporary transformer are consequential rather than direct damages.
HP's power substation is designed to run on a two-transformer system, but the evidence demonstrates that it can run with only one transformer for some period of time and that the ability to run on one transformer was a necessary part of Powell's performance of its work under the contract pursuant to the parties' agreed procedures for the work. We cannot conclude that Powell and HP may be "conclusively presumed to have foreseen" that Powell's breach would necessitate the use of a temporary transformer. See Arthur Andersen, 945 S.W.2d at 816. We therefore conclude that HP's costs in obtaining and installing the temporary transformer are consequential damages.
We overrule Powell's first issue with respect to damage elements (a), (b), (c) and (f), and we sustain Powell's first issue with respect to damages elements (d) and (e).
Powell's argument that HP cannot recover attorney's fees under Section 38.001 of the Civil Practices and Remedies Code
We overrule Powell's second issue.
The trial court's jury charge contained broad form liability questions for breach of contract and breach of warranty.
We review a challenge to the trial court's jury charge under an abuse of discretion standard. Tex. Dep't of Hum. Servs. v. E.B., 802 S.W.2d 647, 649 (Tex. 1990); Moss v. Waste Mgmt. of Tex., Inc., 305 S.W.3d 76, 81 (Tex.App.-Houston [1st Dist.] 2009, pet. denied) (citing European Crossroads' Shopping Ctr., Ltd. v. Criswell, 910 S.W.2d 45, 54 (Tex.App.-Dallas 1995, writ denied). A trial court abuses its discretion when it acts in an arbitrary or unreasonable manner, or if it acts without reference to any guiding rules or principles. Tex. Dep't of Hum. Servs., 802 S.W.2d at 649; Moss, 305 S.W.3d at 81. A trial court has wide discretion in submitting instructions and jury questions. Moss, 305 S.W.3d at 81 (citing Howell Crude Oil Co. v. Donna Ref. Partners, Ltd., 928 S.W.2d 100, 110 (Tex.App.-Houston [14th Dist.] 1996, writ denied).
If we determine that the jury charge was erroneous, we must then consider whether the error requires reversal. See, e.g., Transcon. Ins. Co. v. Crump, 330 S.W.3d 211, 221 (Tex.2010). Generally, charge error requires reversal of a judgment only where the error was harmful in the sense that it probably caused rendition of an improper verdict. Id. (quoting Columbia Rio Grande Healthcare, LP v. Hawley, 284 S.W.3d 851, 856 (Tex.2009)). In the context of a Casteel problem, however, the comingling of valid and invalid theories of liability in a single jury question may make it impossible for the court of appeals to determine whether the jury based its verdict on a properly submitted theory or on an invalid theory that should not have been submitted. See Casteel, 22 S.W.3d at 388 (finding harmful error
A trial court errs by submitting to the jury theories of liability that are not legally viable—e.g., liability theories that have not been pled, are not supported by the legally sufficient evidence, or are not supported by operative law. See Tex.R. Civ. P. 277 (requiring that the trial court submit issues that are raised by the pleadings and the evidence); Casteel, 22 S.W.3d at 390 (stating that Rule 277 implicitly mandates that the jury be able to base its verdict on legally valid questions and instructions); see also Romero v. KPH Consol., Inc., 166 S.W.3d 212, 215 (Tex.2005) ("[B]road-form submission cannot be used to put before the jury issues that have no basis in the law or the evidence."). Thus, although Rule 277 of the Texas Rules of Civil Procedure requires the trial court to submit broad-form questions whenever feasible, submission of broad-form liability question may be infeasible when the trial court is uncertain about whether particular theories of liability should be submitted. TEX.R. CIV. P. 277; Casteel, 22 S.W.3d at 390. In that circumstance, judicial economy may favor separate submission of liability theories to prevent the need to re-try the cause of action if the trial court reaches an incorrect decision with regard to which theories of liability should be submitted to the jury. Casteel, 22 S.W.3d at 390.
Powell argues that HP advanced eleven theories of contract liability at trial, reciting the eleven breaches listed in HP's petition. Powell argues that some of these theories were valid and some were invalid. Powell points to evidence in the record of three alleged breaches other than the cross-phasing of the breakers: Powell's failure to properly connect internal CT wires, to keep its work site clean, and to live up to its contractual obligations after transformer B failed.
HP responds that Powell's argument inaccurately equates "theories of liability" with factual allegations, when the term is properly understood to relate to causes of action such as breach of contract or breach of warranty. HP asserts that the two liability questions submitted only a single theory of liability, each of which was supported by several factual bases. HP points out that the Supreme Court of Texas has "limited [its] holdings in Casteel and Harris County to submission of a broad-form question incorporating multiple theories of liability or multiple damage elements." Bed, Bath & Beyond, Inc. v. Urista, 211 S.W.3d 753, 756-57 (Tex.2006) (citing Casteel, 22 S.W.3d at 388 and Harris County v. Smith, 96 S.W.3d 230, 233 (Tex.2002), which applied Casteel analysis to submission of an unsupported element of damages). HP also asserts that, while there may have been evidence that Powell's conduct breached the contract in multiple ways, "HP's whole theory of the case focused on one breach that resulted in the damages to transformer B—i.e. cross-phasing the breaker cables." HP never contended that any other breach caused damages, so there was no risk that the jury might find damages based on evidence of other breaches.
We conclude that HP's evidence relating to Powell's failure to properly connect CT
In Bush, the medical center argued on appeal that the court improperly submitted invalid theories of liability because some of the specific acts of negligence pled by the plaintiff were not supported by evidence. Bush, 122 S.W.3d at 857. The medical center asserted that the trial court erred by refusing its proposed limiting instructions to the jury not to consider those specific acts of negligence. Id. at 857-58. The court of appeals affirmed the trial court's judgment, concluding that the charge "properly submitted one theory of liability and recovery—negligence—in a single broad-form question." Id.
In Hawley, the trial court submitted a broad-form jury question on negligence and included in the charge an instruction that the defendant-hospital acted "through its employees, agents, nurses and servants." The trial court denied the hospital's request that the jury be instructed not to consider the acts of a particular defendant-doctor, Dr. Valencia, in determining whether the hospital was negligent because Dr. Valencia was an independent contractor for whose conduct the hospital could not be held liable. Hawley, 284 S.W.3d at 862-63. The supreme court held that the charge was erroneous because the instruction on "employees, agents, nurses and servants" allowed the jury to improperly determine that the hospital was negligent based only on the conduct of Dr. Valencia. Id. at 864-65.
Comparing the issue presented in Hawley to the issue presented in Bush, the supreme court observed that in both cases, "negligence was the only theory of liability submitted." Id. at 864. The court distinguished the two cases on the ground that the hospital in Hawley was complaining "because the charge affirmatively told the jury that the hospital acted through its employees, agents, nurses, and servants and allowed the jury to speculate whether Dr. Valencia was an agent of the hospital"; it was not complaining of "the failure to instruct the jury that it should not consider specific acts of negligence." Id. The court then observed that, considering the question and the instruction together, the trial court's charge "submitted four negligence questions," one for each set of actors identified in the instruction. Id.
Here, Powell did not request an instruction that the jury not consider its failure to properly connect CT wires, keep its work site clean, and provide assistance after the transformer failed in determining whether it breached the contract. Because "Question 1" submitted only a single theory of liability and the trial court did not otherwise instruct the jury to consider erroneous matters, we conclude that the trial court did not err by submitting an invalid theory of liability in "Question 1." Cf. Bush, 122 S.W.3d at 857-58; Bed, Bath & Beyond, Inc., 211 S.W.3d at 757 ("When, as here, the broad-form questions submitted a single liability theory (negligence) to the jury, Casteel's multiple-liability-theory analysis does not apply."); Mustafa v. Matrut, No. 01-08-00985-CV, 2010 WL 1492419, at *4-5 (Tex.App.-Houston [1st Dist.] Apr. 15, 2010) (mem. op.), supplemented, No. 01-08-00985-CV, 2010 WL
The breach of warranty question proposed by Powell submitted breach of express warranty as a single jury finding, not segmented by particular factual basis or theories, but it included an instruction restating the express warranty provided under the parties' contract. To the extent Powell argues that the trial court erred in refusing to include its breach of warranty instruction, Powell does not demonstrate how its proposed instruction would have prevented the jury from considering any improperly submitted theory of liability or why the instruction was otherwise necessary. Nor does Powell point to any evidence in the record that might have caused the jury to find a breach of warranty based on conduct and that would have been excluded under Powell's proposed instruction. We conclude the trial court was within its discretion in declining to submit Powell's proposed instruction. See Bush, 122 S.W.3d at 857-58 (holding that trial court did not err in refusing instruction that would have directed jurors not to consider specific acts of negligence in determining medical center's liability).
On cross-appeal, HP argues that the jury impermissibly reduced the amount of damages and attorney's fees by fifteen percent,
Powell raises a legal sufficiency challenge to the jury's damage and attorneys' fee findings. When a party attacks the legal sufficiency of an adverse finding on an issue on which it has the burden of proof, the party must demonstrate on appeal that the evidence establishes, as a matter of law, all vital facts in support of the issue. Dow Chem. Co. v. Francis, 46 S.W.3d 237, 241 (Tex.2001) (addressing standard of review with respect to jury finding of $0 in damages for retaliation
HP contends that the proper amount of its damages award is conclusively established by the invoices it submitted. HP points to no other evidence as establishing its right to damages in the amount claimed. The invoices may establish that HP spent the amounts shown in the invoices relating to transporting and repairing transformer B, but they do not establish HP's right to recover all of the amounts expended as a matter of law. As Powell notes, there was evidence from which the jury could have concluded that Powell did not proximately cause all of these costs. There is evidence in the record tending to show that transformer B was fifteen years old, had experienced prior faults, was not properly maintained, and had pre-existing damage or deterioration. There is also evidence in the record that the useful life of a transformer like transformer B is twenty to twenty-five years on average, as well as evidence that the repairs and replacement of parts in transformer B may have left the transformer a better condition than it had been before the failure.
The trier of fact is given broad discretion to award damages within the range of evidence presented at trial. Duggan v. Marshall, 7 S.W.3d 888, 893 (Tex. App.-Houston [1st Dist.] 1999, no pet.) (citing City of Houston v. Harris Cnty. Outdoor Adver. Ass'n, 879 S.W.2d 322, 334 (Tex.App.-Houston [14th Dist.] 1994, writ denied); Potter v. GMP, L.L.C, 141 S.W.3d 698, 703 (Tex.App.-San Antonio 2004, pet. dism'd) (citing VingCard A.S. v. Merrimac Hospitality Sys., Inc., 59 S.W.3d 847, 865 (Tex.App.-Fort Worth 2001, pet. denied) and Duggan, 7 S.W.3d at 893). Evidence corresponding to the exact amount found by the trier of fact is not essential. Gibson Plumbing Heating & Air Conditioning, Inc. v. Coolbaugh Chiropractic, No. 07-05-0449-CV, 2007 WL 763806, at *3 (Tex.App.-Amarillo Mar. 14, 2007, no pet.) (mem. op.) (affirming jury award of amount less than total owed under bills in evidence) (citing Carrow v. Bayliner Marine Corp., 781 S.W.2d 691, 695 (Tex.App.-Austin 1989, no writ)); see also Reeder v. Wood Cnty. Energy LLC, 320 S.W.3d 433, 448 (Tex.App.-Tyler 2010, pet. filed) (stating, in this context, damages must be established with reasonable certainty, not mathematical precision) (citing O & B Farms, Inc. v. Black, 300 S.W.3d 418, 422 (Tex.App.-Houston [14th Dist.] 2009, pet. filed)).
Here, the jury could reasonably have concluded that approximately fifteen percent of the repairs to the transformer was the result of pre-existing damage to the transformer or was attributable to pre-existing deterioration in the value of the transformer. The jury also may have reasonably concluded that not all of the costs expended by HP were necessary to put HP in the position it would have been in but for Powell's breach, based on the evidence that the replacement of certain of transformer B's parts resulted in an improvement
Thus, the range of evidence presented to the jury could reasonably allow it to find some but not all of the repair costs paid by HP were the proximate result of Powell's breach. Because the jury's award falls within this range, "[w]e are not permitted to disregard the jury's damages award on the basis that the jury's reasoning in arriving at its figure is unclear." Duggan, 7 S.W.3d at 893; see also Adams v. Petrade Int'l, Inc., 754 S.W.2d 696, 709-10 (Tex.App.-Houston [1st Dist.] 1988, writ denied) ("Neither are we permitted to disregard the jury's answers to the issues merely because the jury's reasoning in arriving at its figure may be unclear to us."). We conclude that legally sufficient evidence supports the jury's award of damages. Cf. Duggan, 7 S.W.3d at 893 (determining that jury award of $232,500 was supported by sufficient evidence in light of conflicting damage estimates of $425,309, $15,000, $236,000 and $165,356); Adams, 754 S.W.2d at 709 (noting that jury award was "substantially less than the amount that the evidence shows [plaintiff] had already paid" but within range of damages supported by evidence, and "in reviewing the adequacy of damages, we may not substitute our judgment for that of the jury."); Potter, 141 S.W.3d at 703-04 (affirming jury award of $189,595 as within the range of evidence in breach of contract case); Vela v. Wagner & Brown, Ltd., 203 S.W.3d 37, 50 (Tex.App.-San Antonio 2006, no pet.) (jury was free to reject in part expert damage models of $13.9 million and $9.4 million and instead award $3 million in damages); Howell Crude Oil Co. v. Donna Ref. Partners, Ltd., 928 S.W.2d 100, 108 (Tex.App.-Houston [14th Dist.] 1996, writ denied) (affirming jury award of less than damages calculation presented where challenges were made to reliability of calculation).
The jury awarded attorney's fees of $163,526.24 for preparation and trial and $0 for an appeal to the court of appeals. HP argues that the trial court should have disregarded these findings and awarded $192,383.81 for preparation and trial and $50,000 for an appeal to the court of appeals because HP's evidence conclusively proved these amounts as its reasonable and necessary attorney's fees through the submission of bills and attorney testimony. Powell responds that it disputed the amount of fees requested by HP, that HP's fee segregation evidence was "incredible on its face," that HP's own counsel admitted that the requested fees included amounts that would result in a double recovery if court costs were separately awarded, and that the reasonableness and necessity of the fees is a question of fact within the purview of the jury.
An award of attorney's fees must be supported by evidence that the fees were both reasonable and necessary.
Here, HP's bills and attorney testimony establish the amount HP paid its attorneys but do not conclusively establish that this amount was reasonable and necessary. See Garcia, 319 S.W.3d at 642 (rejecting plaintiff's argument that his attorney's testimony concerning reasonable attorney's fees conclusively established amount of fees and holding that such testimony was some, but not conclusive, evidence of a reasonable fee). It is within the jury's discretion to determine that the reasonable value of the attorneys' services employed by HP was less than the amount billed by the attorneys. See id. Likewise, because the jury awarded HP less than the full damages it requested, the jury may have determined that this outcome warranted a lesser fee than that requested by HP. See Smith, 296 S.W.3d at 548-49 (holding that court of appeals erred by rendering judgment for full amount of attorney's fees sought after reversing $0 fee award because jury awarded less in damages than amount sought and therefore uncontroverted attorney testimony on amount of attorney's fees did not establish amount of reasonable and necessary fees as a matter of law); see also Gunter, 808 S.W.2d at 166; Matthiessen, 897 S.W.2d at 826. There was also evidence before the jury from which the jury reasonably could have concluded that the attorney's fees sought by HP should be reduced to preclude double recovery of the same costs as both attorney's fees and court costs.
Because we have meaningfully reduced the amount of HP's damages on appeal, we must reverse the attorney's fees award and remand for a determination of attorney's fees. See Barker v. Eckman, 213 S.W.3d 306, 314 (Tex.2006) (holding that appellate court should reverse and remand issue of attorney's fees where damages are reduced on appeal in a manner that could affect the determination of reasonable and necessary attorney's fees); Young v. Qualls, 223 S.W.3d 312, 314-15 (Tex.2007) (same).
For the same reasons, we conclude that HP has not established that the amount of such reasonable and necessary attorney's fees on appeal is $50,000 as a matter of law. Because the jury determined that the amount HP was entitled to recover on its claims was less than that calculated by HP, the jury could also reasonably have determined that the value assigned by HP's counsel to its services, at trial and on appeal, was too high in light of the results obtained. See Smith, 296 S.W.3d at 548. However, while the jury is free to determine that a lesser fee is reasonable, it is not free to determine that no fee should be awarded where there is evidence showing that some amount of attorney's fees were reasonable and necessary and no evidence showing that the services rendered had no value. Smith, 296 S.W.3d at 548 ("Although it could have rationally concluded that, in light of the amount involved and the results obtained, a reasonable fee award was less than the full amount sought, no evidence supported the jury's refusal to award any attorney's fees[.]"); Midland W. Bldg. LLC v. First Serv. Air Conditioning Contractors, Inc., 300 S.W.3d 738, 739 (Tex.2009) ("While the jury could have rationally concluded that a reasonable and necessary fee was less than the amount sought, an award of no fees was improper in the absence of evidence affirmatively showing that no attorney's services were needed or that any services provided were of no value.").
Because HP did not prove the amount of its attorney's fees on appeal as a matter of law, but the jury's award of no attorney's fees for appeal is not supported by legally sufficient evidence, we remand the issue of HP's appellate attorney's fees for new trial.
We reverse the trial court's judgment with respect to the award of damages pursuant
The "Indemnification and Remedies" provisions of the contract provide:
HP will not reimburse Powell for:
