Celmer, Elizabeth W. v. McGarry, Charles
2013 Tex. App. LEXIS 9985
| Tex. App. | 2013Background
- This is a fee dispute arising from Celmer and Bufkin's divorce, interpleader funds in registry, and McGarry's claims for breach of contract and quantum meruit.
- The original contingency fee contract (2001) provided 45% of Norgasco stock or 50% if a Supreme Court filing occurred; Celmer would pay expenses.
- McGarry argued a 2004 emails-based second agreement expanded the fee to 50% of Celmer's total recovery plus $200/hour and expenses; Celmer contested this.
- The second agreement, if any, allegedly arose during remand proceedings after the first appeal, when Celmer retained new counsel and McGarry financed extensive trial expenses.
- Jury found an agreement for 50% of total recovery, $200/hour, and expenses; Celmer challenged the enforceability of that agreement, invoking statute of frauds and fiduciary-breach defenses.
- Trial court remitted part of the verdict as unconscionable; appellate court reversed in part, rendered for McGarry on quantum meruit, and awarded damages of $92,842.56 plus interest, with fees and costs affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was there a valid second fee agreement expanding to Celmer's total recovery? | Celmer: no enforceable contract meeting the terms. | McGarry: emails or a lost writing evidence a second agreement. | Legally insufficient evidence of an enforceable second agreement |
| If no second contract, are damages proper under quantum meruit or contract repudiation? | Celmer: no contract; damages improper; seek forfeiture. | McGarry: quantum meruit still available for second-trial work; partial damages warranted. | Damages awarded for quantum meruit on second-trial work upheld in part; forfeiture not warranted |
| Did the trial court err in granting a directed verdict on tortious interference? | Celmer: tortious interference claims present damages. | McGarry: lack of damages and no interference established. | Directed verdict affirmed; no damages shown |
| Was Celmer's amendment-striking of fiduciary-duty claims an abuse of discretion? | Celmer: amendments relate to fiduciary duty issues. | McGarry: amendments were prejudicial and reshaped the case. | Amendment struck; no abuse of discretion |
| Is the 2004 email-based second agreement enforceable under the Texas Uniform Electronic Transactions Act (UETA) or statute of frauds? | Celmer: emails suffice; UETA supports electronic writing/signature. | McGarry: emails show meeting of minds but not a complete written term; lost writing theory remains possible. | Court rejected the UETA theory; relied on lost writing and email evidence against enforceability |
Key Cases Cited
- Scott v. Ingle Bros. Pac., Inc., 489 S.W.2d 554 (Tex. 1972) (contract formation is a question of fact; binding obligations may arise from informal agreements)
- T.O. Stanley Boot Co., Inc. v. Bank of El Paso, 847 S.W.2d 218 (Tex. 1992) (parties must agree to the material terms; same understanding and timing essential)
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (highly deferential standard for no-evidence review; verdicts must be supported by more than a scintilla)
- St. Joseph Hosp. v. Wolff, 94 S.W.3d 513 (Tex. 2002) (no-evidence review under due process; evaluate evidence in light favorable to verdict)
- Hoover Slovacek LLP v. Walton, 206 S.W.3d 557 (Tex. 2006) (fee-forfeiture and unconscionability standards; public policy considerations)
- Keck, Mahin & Cate v. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa., 20 S.W.3d 692 (Tex. 2000) (attorney-client fiduciary duties; presumption of unfairness in fee contracts)
- Wythe II Corp. v. Stone, 342 S.W.3d 96 (Tex. App. Beaum. 2011) (forfeiture of fees related to fiduciary-duty breaches; trial court abuse standard)
- Angroson, Inc. v. Indep. Commc’ns, Inc., 711 S.W.2d 268 (Tex. App. Dallas 1986) (quantum meruit when no enforceable contract; recover reasonable value)
- Chakur v. Zena, 233 S.W.2d 200 (Tex. Civ. App. San Antonio 1950) (lost written agreements may be proven; clear and convincing standard)
- EP Operating Co. v. MJC Energy Co., 883 S.W.2d 263 (Tex. App. Corpus Christi 1994) (lost writing evidence; statutory code context)
- VingCard A.S. v. Merrimac Hospitality Sys., Inc., 59 S.W.3d 847 (Tex. App. Fort Worth 2001) (contingent-fee proof; writing requirement considerations)
- Bufkin v. Bufkin, 259 S.W.3d 343 (Tex. App. Dallas 2008) (post-divorce property dispute; appellate context for fee disputes)