Court of Appeals of Texas,
Dallas.
POLY TRUCKING, INC., Appellant
v.
KDT EXPRESS, INC., Appellee.
No. 05-09-00078-CV.
Before Justices MOSELEY, BRIDGES, and FILLMORE.
MEMORANDUM OPINION
Opinion by Justice BRIDGES.
Poly Trucking, Inc. appeals the trial court’s judgment in favor of KDT Express. A jury found that both Poly Trucking and KDT failed to comply with the underlying contract between the parties and found KDT’s damages to be $81,500 and Poly Trucking’s damages to be $21,582.14. The trial court entered judgment offsetting these amounts and, among other things, awarding KDT $59,917.86 in actual damages and $7485.63 in pre-judgment interest. In four issues, Poly Trucking argues the trial court erred in setting aside the default judgment originally entered against KDT, the evidence does not support the jury’s $81,500 award of damages to KDT, the trial court erred in failing to reduce the damages award by the amount in excess of the maximum damages supported by the evidence, granting pre-judgment interest, and failing to award costs to each party.
We suggest a remittitur of $21,045.06 with respect to actual damages, as well as $2,629.19 with respect to pre-judgment interest allocable to the remittitur of actual damages. In all other respects, we affirm the trial court’s judgment.
In January 2006, the parties entered into a “Broker’s Agreement” under which KDT would act as a broker providing certified carriers to perform shipping services for Poly Trucking. Poly Trucking manufactures plastic bags at its facility in Grand Prairie. Isaac Hull, former distribution manager for Poly Trucking, testified Poly Trucking’s facility had a limited number of bay doors, and trucks were loaded according to a time schedule. When trucks did not show up on time, the goods set aside for the late trucks blocked efforts to load other trucks and disrupted the process of loading. Hull testified that timing was also critical when delivering the goods to Poly Trucking’s customers, such as Wal-Mart and Home Depot. As a result, the contract between Poly Trucking and KDT set forth penalty fees of $500 for “Load pick-up no shows,” $350 per day for late deliveries, and $650 for loads that KDT failed to deliver.
Jesse Raia, general manager of Poly Trucking, testified KDT raised a claim that Poly Trucking owed KDT $120,000. Raia spoke with “Tori Adder” at KDT, and Raia understood that, if he paid $60,000, KDT “would drop the claims against Poly Trucking.” Raia sent KDT a check for $60,000 and wrote “settlement” on the check stub. However, Raia told Adder “Poly still had some claims against KDT.” Raia testified KDT had been “constantly missing loads” and was “constantly late for pick-ups.” “There was just problem after problem.” Poly Trucking filed suit against KDT alleging claims for breach of contract, attorney’s fees, and prejudgment and post-judgment interest. KDT was served with citation via the secretary of state on February 22, 2007.
By letter dated March 12, 2007, David Tykwinski, KDT’s owner, informed the clerk of the district court he knew of no reason why the citation was presented to him, he did not know what “contract” he allegedly breached, “Poly America” had avoided correspondence or conversation with KDT regarding “settling their debt,” and he believed his claims against “Poly America” had merit. Tykwinski asked for the court’s cooperation in resolving KDT’s claims. The record reflects Tykwinski’s letter was sent certified mail, return receipt requested, and the return receipt shows the letter was received on March 19, 2007. However, the letter was not filed by the district clerk until April 5, 2007.
Meanwhile, on March 31, 2007, the trial court entered a default judgment against KDT awarding Poly Trucking $40,000, with interest, and $750 in attorney’s fees. On April 13, 2007, KDT filed its motion for new trial arguing it had sent its answer to the district clerk and it was therefore entitled to notice of a trial or other dispositive hearing before a default judgment could be entered. Because KDT did not receive notice of the hearing at which default judgment was entered, it argued it was entitled to a new trial. On May 24, 2007, the trial court granted KDT’s motion for new trial and ordered the case reinstated on the court’s docket.
Following a jury trial, the jury found that both KDT and Poly Trucking had failed to comply with the agreement between the parties and awarded Poly Trucking $21,582.14 and KDT $81,500. The trial court entered a final judgment awarding KDT $59,917.86, prejudgment interest of $7485.63 and post-judgment interest at 5%. This appeal followed.
In its first issue, Poly Trucking argues the trial court erred in granting KDT’s motion for new trial and setting aside the default judgment. It is error for a trial court to grant a default judgment after an answer has been filed, even if the trial court is unaware that it has been filed. Davis v. Jefferies, 764 S.W.2d 559, 560 (Tex.1989); Lewis v. Leftwich, 775 S.W.2d 848, 849 (Tex.App.-Dallas 1989, no writ). A letter filed by a defendant may serve as a sufficient answer to avoid default judgment if it identifies the parties, the case, and provides the defendant’s current address. Smith v. Lippmann, 826 S.W.2d 137, 138 (Tex.1992); In re J.P., 196 S.W.3d 434, 437 (Tex.App.-Dallas 2006, no pet.). Here, Tykwinski’s letter identified the parties and the case number and gave KDT’s current address. Thus, the letter was sufficient to avoid default judgment and entitle KDT to notice of a default judgment hearing. Smith, 826 S.W.2d at 138. Accordingly, the trial court did not abuse its discretion in granting KDT’s motion for new trial and setting aside its default judgment. See Dir., State Emps. Workers’ Comp. Div. v. Evans, 889 S.W.2d 266, 268 (Tex.1994). We overrule Poly Trucking’s first issue.
In its second issue, Poly Trucking argues the evidence is legally and factually insufficient to support the jury’s award of $81,500 in damages. When both the legal and factual sufficiency of the evidence are challenged, we first review the legal sufficiency of the evidence to determine whether there is any evidence of probative value to support the factfinders’ decision. See Manon v. Tejas Toyota, Inc., 162 S.W.3d 743, 752 (Tex.App.-Houston [14th Dist.] 2005, no pet.); Exxon Corp. v. Breezevale Ltd., 82 S.W.3d 429, 438 (Tex.App.-Dallas 2002, pet. denied). In a legal sufficiency or no evidence review, we determine whether the evidence would enable reasonable and fair-minded people to reach the finding under review. City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex.2005). In conducting this review, we credit favorable evidence if reasonable factfinders could and disregard contrary evidence unless reasonable factfinders could not. Id. We must consider the evidence in the light most favorable to the finding under review and indulge every reasonable inference that would support it. Id. at 822. We must sustain no-evidence points when the record reveals: a complete absence of evidence of a vital fact, the court is barred by rules of law or of evidence from giving weight to the only evidence offered to prove a vital fact, the evidence offered to prove a vital fact is no more than a mere scintilla, or the evidence establishes conclusively the opposite of the vital fact. Id. at 810.
When reviewing an assertion that the evidence is factually insufficient to support a finding, we set aside the finding only if, after considering and weighing all of the evidence in the record pertinent to that finding, we determine that the evidence supporting the finding is so weak, or so contrary to the overwhelming weight of all the evidence, that the answer should be set aside and a new trial ordered. See Dow Chemical Co. v. Francis, 46 S.W.3d 237, 242 (Tex.2001); Thomas v. Uzoka, 290 S.W.3d 437, 452 (Tex.App.-Houston [14th Dist.] 2009, pet. denied).
KDT’s live pleading requests a total of $60,454.94 in damages under separate theories of recovery. At trial, KDT accountant Kim Tykwinski testified Poly Trucking failed to pay a total of $120,454.94, minus the $60,000 check Raia sent, leaving a remaining balance of $60,454.94. KDT also entered into evidence a list of unpaid invoices showing an outstanding balance of $60,454.94. Thus, the evidence supported a damage award of only $60,454.94 to KDT, not $81,500 as found by the jury.
KDT argued it was forced to lay off employees and incur debt collection expenses due to Poly Trucking’s failure to pay amounts owed. Consequential damages are those damages that result naturally, but not necessarily, from a defendant’s wrongful acts. Stuart v. Bayless, 964 S.W.2d 920, 921 (Tex.1998). They are not recoverable unless the parties contemplated at the time they made the contract that such damages would be a probable result of the breach. Id. Thus, to be recoverable, consequential damages must be foreseeable and directly traceable to the wrongful act and result from it. Id. The agreement between the parties does not mention the possibility of laying off employees or hiring collection agencies and contains no agreement to pay damages for losses thus incurred. Because such losses were not reasonably foreseeable, recovery for an amount in excess of $60,454.94 is not supported by the record. See id. We conclude the evidence is legally and factually insufficient to support an award in excess of $60,454.94. See City of Keller, 168 S.W.3d at 827; Dow Chemical, 46 S.W.3d at 242. We sustain Poly Trucking’s second issue to the extent it claims no evidence supported a damage award in excess of $60,454.94.
Therefore, we suggest a remittitur. Factual sufficiency is the sole remittitur standard for actual damages. Pope v. Moore, 711 S.W.2d 622, 624 (Tex.1986). This Court is vested with the power to suggest a remittitur on its own motion when the appellant complains that there is insufficient evidence to support an award and the Court agrees but finds that there is sufficient evidence to support a lesser award. Comstock Silversmiths, Inc. v. Carey, 894 S.W.2d 56, 58 (Tex.App.-San Antonio 1995, no writ) (citing David McDavid Pontiac, Inc. v. Nix, 681 S.W.2d 831, 838 (Tex.App.-Dallas 1984, writ ref’d n.r.e.). If part of a damage verdict lacks sufficient evidentiary support, the proper course is to suggest a remittitur of that part of the verdict. Comstock, 894 S.W.2d at 58. The party prevailing in the trial court should be given the option of accepting the remittitur or having the case remanded. Id. To protect this option, we conclude the power to suggest remittitur in this circumstance also includes the power to suggest remittitur as to any award of pre-judgment interest based on the amount of the reduction of the damage award.
In Poly Trucking’s third issue, it argues (1) the jury’s award in excess of the maximum damages alleged could not have resulted from the contract because the contract did not contain an interest clause and (2) the trial court should not have awarded pre-judgment interest. KDT argues the trial court erred in modifying the award of pre-judgment interest in response to Poly Trucking’s responsive pleading filed fifty-one days after the trial court signed a judgment in favor of KDT. According to KDT, the trial court lacked plenary power to consider matters raised by Poly Trucking’s responsive pleading filed more than thirty days after judgment was entered on August 18, 2008. Specifically, KDT argues, the trial court could not consider Poly Trucking’s challenge to the award of pre-judgment interest, raised for the first time in its pleading filed fifty-one days after the trial court’s judgment.
The record shows the trial court entered a “Final Judgment” on August 18, 2008. On August 27, 2008, Poly Trucking filed a motion for new trial, which it supplemented on September 8, 2008. On October 8, 2008, fifty-one days after judgment, Poly Trucking filed its responsive pleading alleging the pre-judgment interest awarded to KDT was improper. A motion for new trial shall be filed prior to or within thirty days after the judgment or other order complained of is signed. TEX.R. CIV. P. 329b(a). If a motion for new trial is not determined by written order signed within seventy-five days after the judgment was signed, it shall be considered overruled by operation of law. TEX.R. CIV. P. 329b(c). Thus, if a motion for new trial is timely filed, rule 329b(c) grants plenary power to the trial court for up to seventy-five days from the date judgment was entered. In re Fuentes, 960 S.W.2d 261, 263 (Tex.App.-Corpus Christi 1997, no pet.). Because Poly Trucking timely filed a motion for new trial and filed its responsive pleading challenging the award of pre-judgment interest less than seventy-five days after judgment was entered, the trial court had plenary power to consider matters raised in the pleading. See id.
As to Poly Trucking’s attack against the jury’s award of damages in excess of the maximum damages alleged, we have already concluded, for other reasons, that the evidence did not support the jury’s award in excess of $60,454.94. Poly Trucking’s argument seems to focus on whether interest accounted for the jury’s award in excess of that amount, and Poly Trucking does not raise the issue of whether the trial court’s award of pre-judgment interest was erroneous. Assuming that Poly Trucking’s issue raises this issue, however, we conclude the trial court did not err in awarding pre-judgment interest.
Pre-judgment interest is “compensation allowed by law as additional damages for lost use of the money due as damages during the lapse of time between the accrual of the claim and the date of judgment.” Johnson & Higgins of Tex., Inc. v. Kenneco Energy, 962 S.W.2d 507, 528 (Tex.1998). There are two legal sources for an award of pre-judgment interest: (1) general principles of equity and (2) an enabling statute. Johnson & Higgins, 962 S.W.2d at 528. Where no statute controls the award of pre-judgment interest, the decision to award pre-judgment interest is left to the sound discretion of the trial court, which should rely upon equitable principles and public policy in making that decision. Citizens Nat’l Bank v. Allen Rae Invs., Inc., 142 S.W.3d 459, 487 (Tex.App.-Fort Worth 2004, no pet.). On the record before us, we conclude the trial court in this case did not abuse its discretion in awarding pre-judgment interest. See id. Further, although the parties now dispute the date from which pre-judgment interest is to be calculated, no objection was made to the trial court’s judgment setting November 17, 2007 as the date pre-judgment interest began to accrue. Accordingly, this issue is not preserved for our review. See TEX.R.APP. P. 33.1. We overrule Poly Trucking’s third issue.
In its fourth issue, Poly Trucking argues the trial court erred in not awarding costs to each party because the jury, though it found both parties had breached the contract, did not enter a finding as to which party breached the contract first. However, Poly Trucking did not raise this issue in the trial court and has not preserved this issue for our review. See TEX.R.APP. P. 33.1. We overrule Poly Trucking’s fourth issue.
In this case, after offsetting the jury’s award of damages to Poly Trucking ($21,582.14) against the maximum sustainable damages awarded to KDT ($60,454.94) the judgment is excessive by $21,045.06 in actual damages, as well as $2,629.19 in pre-judgment interest allocable to the excessive damage amount. In accordance with rule 46.3 of the Texas Rules of Appellate Procedure, if, within fifteen days of the filing of this opinion, KDT shall remit the sum of $21.045.06 in actual damages and $2,629.19 in pre-judgment interest, the judgment below will be reformed and affirmed; otherwise, it will be reversed and remanded. In all other respects, we affirm the trial court’s judgment.
