Bishop Abbey Homes, Ltd. and Nathan Halsey v. Bryon and Paige Hale
05-14-01137-CV
Tex. App.Dec 16, 2015Background
- Bryon and Paige Hale hired Bishop Abbey Homes, Ltd. (BAH) and its manager Nathan Halsey in 2006 to build a home in Rockwall; construction completed in 2006.
- Post‑construction the Hales experienced chronic leaks, large cracks, failing doors, and other problems; BAH/Halsey repeatedly assured them the foundation was not at fault and arranged engineer reviews finding no failure.
- In November 2009 the Hales obtained an independent engineer who concluded foundation defects (and failure to follow the original soils report) caused the problems; Hales sued BAH, Halsey, and AGTM in August 2011 (AGTM later settled).
- A jury found Halsey liable for fraud and BAH liable under the DTPA, awarding economic, mental‑anguish, additional (DTPA), exemplary (fraud), and attorney’s‑fee damages; the trial court entered judgment on the verdict.
- On appeal BAH and Halsey challenged limitations, economic‑loss rule, individual liability of Halsey, closing arguments, sufficiency of fraud/DTPA evidence, and damages amounts/caps.
- The court affirmed liability rulings but suggested remittitur of portions of mental‑anguish, additional, and exemplary damages as exceeding evidentiary or statutory/due‑process limits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Statute of limitations for fraud/DTPA | Hales: limitations tolled by defendants’ repeated assurances and fraudulent concealment; suit timely after independent 2009 report | BAH/Halsey: claims accrued by 2007 and are time‑barred | Held for Hales — jury could find fraudulent concealment and discovery in Nov 2009; claims timely |
| Sufficiency of evidence for fraud/DTPA | Hales: Halsey made false material representations, intended reliance, and Hales justifiably relied and were harmed | Defendants: evidence shows only contract breaches or third‑party fault; Halsey lacked requisite intent | Held for Hales — legally and factually sufficient evidence supported fraud and DTPA findings |
| Individual liability of Halsey | Hales: Halsey made personal misrepresentations and can be held individually for fraud/DTPA | Halsey: acted only as agent/partner of BAH; should be shielded from personal liability | Held for Hales — corporate agent is personally liable for his own fraudulent/tortious acts |
| Damages excessive / statutory caps / economic‑loss rule | Hales: recoverable for fraud/DTPA including mental anguish, exemplary, and additional damages | Defendants: economic‑loss rule bars tort recovery; damages excessive and exceed statutory caps; pleadings limit recovery | Held partially for defendants — economic‑loss rule inapplicable to fraud/DTPA; evidence supports damages generally but court suggested remittitur to reduce mental‑anguish, additional DTPA, and exemplary awards to conform with evidentiary support and statutory/due‑process limits |
Key Cases Cited
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (legal‑sufficiency review standard)
- Formosa Plastics Corp. USA v. Presidio Eng’rs & Contractors, Inc., 960 S.W.2d 41 (Tex. 1998) (fraud exception to economic‑loss rule)
- Woods v. William M. Mercer, Inc., 769 S.W.2d 515 (Tex. 1988) (limitations, discovery rule, fraudulent concealment burden rules)
- Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299 (Tex. 2006) (fraud may support tort damages despite contract)
- Saenz v. Fidelity & Guaranty Ins. Underwriters, 925 S.W.2d 607 (Tex. 1996) (proof required for mental‑anguish award amount)
- Bennett v. Reynolds, 315 S.W.3d 867 (Tex. 2010) (due‑process guideposts for punitive damages review)
- State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408 (U.S. 2003) (constitutional limits on punitive damages)