Lorrie Frazin v. Marc Sauty and Benedicte Sauty
05-15-00879-CV
| Tex. App. | Nov 7, 2016Background
- The Sautys leased residential property from Frazin (lease term July 1, 2008–June 30, 2009) and paid a $2,195 security deposit.
- The Sautys moved to France, provided a forwarding address, and timely asked for return of the deposit after lease end; Frazin retained the full deposit and sent a written notice explaining deductions and claiming losses.
- The Sautys sued in justice court for failure to return the deposit, won, and the case was tried de novo in county court after appeal; a summary-judgment in county court was previously reversed in part on appeal.
- At trial the jury found Frazin failed to return the deposit and also found she did not provide a written, itemized list within 30 days; the jury awarded return of the $2,195.
- The trial court concluded as a matter of law that Frazin acted in bad faith, awarded statutory damages under Tex. Prop. Code § 92.109(a) (treble deposit and $100), costs, and prejudgment interest; attorney’s fees were stricken earlier.
- On appeal, Frazin challenged (1) omission of a jury question as to bad faith tied to failure to provide the itemization, and (2) the award of prejudgment interest on statutory/exemplary damages.
Issues
| Issue | Plaintiff's Argument (Sauty) | Defendant's Argument (Frazin) | Held |
|---|---|---|---|
| Whether omission of a jury question on bad faith regarding failure to provide itemization fatally undermines statutory-damages judgment | Jury found failure to return deposit and failure to provide itemization; bad faith is presumed from those findings so statutory damages are supported | Trial court should have submitted her requested bad-faith question tied to itemization; omission deprived her of required jury determination | Court held error not preserved: bad-faith as to nonreturn was presumed from jury finding and Frazin failed to request a broader bad-faith question; verdict supports statutory damages — issue resolved against Frazin |
| Whether prejudgment interest may be awarded on statutory/trebled damages under §92.109(a) | Lease contract allowed prevailing party to recover prejudgment interest; alternatively prejudgment interest applies | Statutory penalties (treble, $100) are penal/exemplary and prejudgment interest is not recoverable absent express statutory authorization | Court held trial court abused discretion: prejudgment interest not recoverable on the statutory penalties; award of prejudgment interest reversed and deleted |
Key Cases Cited
- Pulley v. Milberger, 198 S.W.3d 418 (Tex. App.—Dallas 2006) (bad-faith presumption and elements for recovery under chapter 92)
- Ellis County State Bank v. Keever, 888 S.W.2d 790 (Tex. 1994) (prejudgment interest not appropriate on punitive-type damages)
- Steves Sash & Door Co. v. Ceco Corp., 751 S.W.2d 473 (Tex. 1988) (prejudgment interest not recoverable on certain statutory penalties)
- Meridien Hotels, Inc. v. LHO Fin. P’ship I, L.P., 255 S.W.3d 807 (Tex. App.—Dallas 2008) (prejudgment interest does not apply to statutory penalties for wrongdoing)
- Ackerman v. Little, 679 S.W.2d 70 (Tex. App.—Dallas 1984) (landlord forfeits right to withhold deposit if in bad faith fails to provide required itemization)
- Reed v. Ford, 760 S.W.2d 26 (Tex. App.—Dallas 1988) (definition and examples of bad faith retention of deposit)
- Johnson & Higgins of Texas, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507 (Tex. 1998) (two sources for prejudgment interest: equity or statute)