Judgment
All judgments, decisions, and orders of any kind should be reduced to writing and signed by the trial judge with the date of signing stated. Tex. R. Civ. P. 306a(2). The date that the judgment was signed, as opposed to the date the judgment was rendered or entered, is the operative date for purposes of postjudgment motions and appeal. Rule 306a provides that time commences to run for appellate steps when the judge signs the judgment. See Tex. R. Civ. P. 306a(1). Also see section 20.12 below.
Any party may prepare and submit a proposed judgment to the court for signature. Tex. R. Civ. P. 305. In doing so, the party must serve it on all other parties who have appeared and remain in the case, in accordance with rule 21a. Failure to comply with rule 305 does not affect the time for perfecting an appeal. Tex. R. Civ. P. 305.
The most common issue with proposed judgments is whether the submission of one waives the party’s right to challenge the judgment later in whole or in part. Caution must be exercised here. A motion for judgment on the verdict is an affirmation by the moving party that the jury findings are supported by the evidence, and the party cannot, thereafter, take an inconsistent position in this regard on appeal. See Chappell Hill Bank v. Lane Bank Equipment Co., 38 S.W.3d 237, 247 (Tex. App.—Texarkana 2001, pet. denied); see also First National Bank of Beeville v. Fojtik, 775 S.W.2d 632 (Tex. 1989); Litton Industrial Products, Inc. v. Gammage, 668 S.W.2d 319, 321–22 (Tex. 1984); DHI Holdings, LP v. Deutsche Bank National Trust Co. as Trustee for Morgan Stanley ABS Capital I Inc. Trust 2006-HE3, Mortgage Pass-Through Certificates, Series 2006-HE3, 650 S.W.3d 522, 527 (Tex. App.—Houston [14th Dist.] 2021, pet. denied). To preserve the right to complain about the judgment on appeal, the moving party should state in its motion for judgment that it agrees only with the form of the judgment and disagrees with the content and result. See Hooks v. Samson Lone Star, L.P., 457 S.W.3d 52, 67 (Tex. 2015) (motion for judgment stating it was filed “without waiving any rights to contest or appeal” and signed “Approved as to Form” sufficient to preserve error); DHI Holdings, LP, 650 S.W.3d at 527. The failure of a party to prepare and submit a proposed judgment to the court for signature does not preclude the party from challenging the judgment. In re Marriage of Ames, 860 S.W.2d 590, 592 (Tex. App.—Amarillo 1993, no writ).
The judgment should contain the full names of the parties, as stated in the pleadings, for and against whom the judgment is rendered. Tex. R. Civ. P. 306. The rule does not require that all parties be included in the caption. Accordingly, if there are multiple defendants, only the first party need be identified in the caption, so long as all parties are identified by full name in the body of the judgment (see also section 20.4 below). Care should be exercised in identifying the parties to insure accuracy and avoid later difficulty in seeking to enforce the judgment. However, the better practice is to recite the names of all the parties in the judgment. Crystal City Independent School District v. Wagner, 605 S.W.2d 743, 747 (Tex. App.—San Antonio 1980, writ ref’d n.r.e.).
§ 20.4Recitals—Appearances of Parties
The recital section of the judgment should identify the full name of the parties and their participation in the proceeding, for example, who appeared, how the party appeared (in person, through counsel of record, or pro se), who defended at trial, who answered but failed to defend further, who defaulted, and what method of service was used on any defendant who defaulted. With rare exception, judgment may not be granted in favor of or against a party not named in the suit as a plaintiff or a defendant. See Mapco, Inc. v. Carter, 817 S.W.2d 686, 687 (Tex. 1991) (per curiam); Exito Electronics, Co. v. Trejo, 166 S.W.3d 839, 852 (Tex. App.—Corpus Christi–Edinburg 2005, no pet.). There may be instances, however, when the failure to name a party in the body of the judgment is not fatal, if the party’s identity can be established from the caption of the case, the record, the pleadings, and the process. Gomez v. Bryant, 750 S.W.2d 810, 811 (Tex. App.—El Paso 1988, no writ). See also Elliott v. Hamilton, 767 S.W.2d 262, 263 (Tex. App.—Beaumont 1989, writ denied) (probate proceeding; “Persons, though not nominal parties to a lawsuit, may, by their active and open participation, so connect themselves with the litigation to have the legal effect of making them a party.”).
§ 20.5Recitals—Nature of Proceedings
Texas judgments typically also identify the nature and date of the proceedings. The rules do not require such a statement but it is helpful in providing the context for the decision. The judgment should therefore state the dates during which the case was tried and whether the case proceeded by bench or jury trial. If a part of the case has been resolved by dismissal, summary judgment, instructed verdict, or judgment notwithstanding the verdict, the judgment should reflect so. See the following forms: Motion for Entry of Default Judgment (form 20-1) with supporting Certificate of Last Known Email and Mailing Address (form 20-2), Nonmilitary Affidavit (form 20-3), Attorney’s Fees Affidavit (form 20-4), Default Judgment (forms 20-5 and 20-6), Judgment Nihil Dicit (form 20-7), Final Summary Judgment (form 20-8), Partial Summary Judgment (form 20-9), Final Judgment [After Partial Summary Judgment and Trial] (form 20-10), Agreed Judgment (form 20-11), Judgment on Foreign Judgment (form 20-12), and Judgment (forms 20-13, 20-14, and 20-15).
The judgment need not describe the evidence on which it is based but should include a statement that the court heard evidence and is of the opinion that judgment should be rendered for the successful party.
The judgment of the court must conform to the pleadings, the nature of the case proved, and the verdict, if any. Tex. R. Civ. P. 301. When issues not raised by the pleadings are tried by express or implied consent of the parties, they will be treated in all respects as if they had been raised in the pleadings. Tex. R. Civ. P. 67. A pleading defect not properly raised before the charge to the jury or, in a nonjury case before judgment is signed, may be waived. Tex. R. Civ. P. 90.
Findings of fact must not be recited in a judgment; rather, they must be sent as a separate document. Tex. R. Civ. P. 299a. In any case tried in a district court or county court without a jury, any party may request the court to state in writing its findings of fact and conclusions of law. Tex. R. Civ. P. 296. The procedures to request findings of fact and conclusions of law are set forth in Tex. R. Civ. P. 296–298. If findings of fact are not requested by the losing party, it is implied that the trial court made all findings necessary to support its judgment. Worford v. Stamper, 801 S.W.2d 108, 109 (Tex. 1990); Estrada v. Garrett-Estrada, No. 03-22-00017-CV, 2023 WL 3132552, at *4 (Tex. App.—Austin Apr. 28, 2023, pet. denied) (mem. op.). When findings of fact are sent by the trial court, they must form the basis of the judgment on all grounds of recovery and of defense embraced therein. Tex. R. Civ. P. 299.
§ 20.9Decretal Language in Judgment
The decretal language in a judgment determines the rights of the parties; it is the section in the judgment that begins “It is hereby ordered, adjudged and decreed” or “It is ordered.” The judgment should determine the rights of all parties and dispose of all issues. Felderhoff v. Knauf, 819 S.W.2d 110, 111 (Tex. 1991) (per curiam). A court’s judgment is its announcement of the resolution of the issues in the lawsuit. State v. Naylor, 466 S.W.3d 783, 788 (Tex. 2015); In re A.I.M., No. 01-22-00409-CV, 2023 WL 8192530, at *6 (Tex. App.—Houston [1st Dist.] Nov. 28, 2023, no pet.) (mem. op.). If the subject of the judgment is property, the judgment must describe the property with reasonable certainty. See Dellana v. Walker, 866 S.W.2d 355, 358 (Tex. App.—Austin 1993, writ denied) (trespass to try title). The judgment must be framed to give the prevailing party all the relief to which that party may be entitled in law or in equity. Tex. R. Civ. P. 301. If no relief is granted to a party, that party cannot recover under the judgment. See section 20.15 below (discussing language of finality in the judgment disposing of all parties and claims).
The following subsections discuss various forms of relief.
Almost every judgment based on a creditor’s claim will include the following as elements of damages:
1.principal debt (including net amount in case of counterclaim or other setoff or credit);
2.prejudgment interest (see section 20.10 below);
3.postjudgment interest at the highest rate allowed by law (see section 20.11 below);
4.attorney’s fees (see chapter 31 in this manual); and
5.costs (usually recovered under Tex. R. Civ. P. 131 but may be allocated differently under rule 141 for good cause). See Furr’s Supermarkets, Inc. v. Bethune, 53 S.W.3d 375, 378 (Tex. 2001) (“Rule 141’s good cause exception to the mandate of Rule 131 is designed to account for a prevailing party’s questionable conduct that occurs during litigation, permitting the trial judge some discretion to reassess costs so that the cost attendant to that conduct is not visited on an innocent, but losing party.”). See also Heidrich v. Calderazzo, 569 S.W.3d 247, 254–55 (Tex. App.—El Paso 2018, no pet.) (“‘Good cause’ is an elusive concept that varies from case to case but typically has meant that the prevailing party unnecessarily prolonged the proceedings, unreasonably increased costs, or otherwise did something that should be penalized.”); State v. B&L Landfill, Inc., 758 S.W.2d 297, 300 (Tex. App.—Houston [1st Dist.] 1988, no writ) (trial court abused discretion in allotting costs contrary to rule 131 without explanation as required by rule 141).
An award of money damages should clearly state the amount recovered or otherwise furnish the means by which the damages can be ascertained. See Greene v. State, 324 S.W.3d 276, 283 (Tex. App.—Austin 2010, no pet.). A judgment is not final if the amount of damages awarded cannot be determined from the judgment or its exhibits. Wright v. Liming, ___ S.W.3d ___, No. 01-23-00487-CV, 2024 WL 3451028, at *5 (Tex. App.—Houston [1st Dist.] July 18, 2024, no pet.); In re Blankenhagen, 513 S.W.3d 97, 98 (Tex. App.—Houston [14th Dist.] 2016, pet. dism’d). Generally, a judgment for money damages in excess of the amount pleaded is erroneous, even though a higher amount might be warranted by the evidence. Borden v. Guerra, 860 S.W.2d 515, 525 (Tex. App.—Corpus Christi–Edinburg 1993, writ dism’d by agr.). The Texas Supreme Court, however, has held that such a pleading problem may be remedied by a postverdict pleading amendment increasing the amount of the damages sought to the amount awarded by the jury, unless the opposing party establishes an exception based on surprise or prejudice or that the amendment asserts a new cause of action or defense and thus is prejudicial on its face, and the opposing party objects. Greenhalgh v. Service Lloyds Insurance Co., 787 S.W.2d 938, 939 (Tex. 1990) (it would have been an abuse of discretion if the trial court had refused the amendment unless an exception applied); Daniels v. Daniels, No. 02-19-00387-CV, 2021 WL 832648, at *5 (Tex. App.—Fort Worth Mar. 4, 2021, no pet.) (mem. op.).
§ 20.9:2Judgment Involving Property
When property is the subject of a judgment, the judgment should describe the property with reasonable certainty. For land, the description must be sufficient so that an officer executing a writ of possession could ascertain the boundaries of the land. See Dellana v. Walker, 866 S.W.2d 355, 358 (Tex. App.—Austin 1993, writ denied) (trespass to try title). The rules of procedure governing execution should be consulted to assist in determining the requisite specificity for different types of judgment. See Tex. R. Civ. P. 630 (judgment for money), Tex. R. Civ. P. 631 (judgment for sale of particular property), Tex. R. Civ. P. 632 (judgment for the delivery of certain property), and Tex. R. Civ. P. 633 (judgment for the recovery of personal property or its value).
All judgments foreclosing mortgages and other liens shall be that the plaintiff recover “his debt, damages and costs, with a foreclosure of the plaintiff's lien on the property subject thereto.” Tex. R. Civ. P. 309. Unless the judgment is against a personal representative of an estate (see section 20.9:5 below), the judgment must further direct that an order of sale issue—
to any sheriff or any constable within the State of Texas, directing him to seize and sell [the collateral] as under execution, in satisfaction of the judgment; and, if the property cannot be found, or if the proceeds of such sale be insufficient to satisfy the judgment, then to take the money or any balance thereof remaining unpaid, out of any other property of the defendant, as in case of ordinary executions.
Tex. R. Civ. P. 309. A judgment for foreclosure of a tax lien on real estate that fails to describe a definite tract of land is void. AIC Management v. Crews, 246 S.W.3d 640, 645 (Tex. 2008).
§ 20.9:4Alternative Recoveries
If a plaintiff prevails on more than one theory, the judgment cannot award relief on all of them; to do so would violate the “one satisfaction” rule. Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 303 (Tex. 2006); Mendell v. Scott, No. 01-20-00578-CV, 2023 WL 4712050, at *24 (Tex. App.—Houston [1st Dist.] July 25, 2023, pet. filed) (mem. op.). If the trier-of-fact finds for the plaintiff on more than one theory, the party is entitled to the recovery providing it the greatest relief. See Tony Gullo, 212 S.W.3d at 314; Transport Insurance Co. v. Faircloth, 898 S.W.2d 269, 274 (Tex. 1995). The successful party may make its election after it knows the amount it will recover under each of the alternative theories. Tony Gullo, 212 S.W.2d at 314. If the party does not make the election, the trial court is to render judgment affording the greatest recovery. Gulf States Utilities Co. v. Low, 79 S.W.3d 561, 566 (Tex. 2002); Johnson & Higgins of Texas, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 526 (Tex. 1998); Mendell, 2023 WL 4712050, at *24.
§ 20.9:5Judgment Against Personal Representative
A judgment for the recovery of money against an executor, administrator, or guardian shall state that “it is to be paid in the due course of administration.” Tex. R. Civ. P. 313. Instead of levying by execution, the judgment creditor is to certify the judgment to the probate court for enforcement, except that a “judgment against an executor appointed and acting under a will dispensing with the action of the county court in reference to such estate shall be enforced against the property of the testator in the hands of such executor, by execution, as in other cases.” Tex. R. Civ. P. 313.
§ 20.9:6Judgment for Attorney’s Fees
If attorney’s fees are recoverable, a judgment should state a specific sum for legal work performed through judgment. See, e.g., Borg-Warner Protective Services Corp. v. Flores, 955 S.W.2d 861, 865, 870 (Tex. App.—Corpus Christi–Edinburg 1997, no pet.) (judgment set forth specific sum for attorney fees based on lodestar method). The fees should be for a specific amount, not a percentage of the judgment. See Arthur Andersen & Co. v. Perry Equipment Corp., 945 S.W.2d 812, 818–19 (Tex. 1997). The judgment may also allow for additional specified amounts in the event of appeal “provided they are conditioned on ultimate appellate success.” Borg-Warner, 955 S.W.2d at 870; see also A.G. Edwards & Sons, Inc. v. Beyer, 235 S.W.3d 704, 707 n.1 (Tex. 2007) (court of appeals properly reformed trial court’s unconditional grant of attorney’s fees to condition award on unsuccessful appeal); Ventling v. Johnson, 466 S.W.3d 143, 154–55 (Tex. 2015) (a prevailing party at trial may be entitled to appellate attorney’s fees as a successful appellant). The Texas Supreme Court has held that the award of both trial and appellate fees is mandatory if there is proof of reasonable fees and the claim is brought under chapter 38 of the Texas Civil Practices and Remedies Code. See Ventling, 466 S.W.3d at 154. For a full discussion of appellate fees, see section 31.17 in this manual.
In general, the successful party is entitled to recover from its adversary all taxable court costs, except where otherwise provided. Tex. R. Civ. P. 131; Furr’s Supermarkets, Inc. v. Bethune, 53 S.W.3d 375, 376 (Tex. 2001); Martinez v. Pierce, 759 S.W.2d 114, 114 (Tex. 1988) (per curiam). The judgment can either state the amount of costs or state generally that costs are awarded against a particular party.
Practice Note: The preferred manner of addressing costs in a judgment is to use general language awarding costs and, thereafter, rely on the bill of costs prepared by the clerk to itemize the recoverable costs. If a bill of costs fails to include a recoverable cost, the issue is frequently resolved with a phone call to the clerk. If the issue cannot be resolved that way, a motion should be filed with the court to correct the bill of costs. Under rule 629, a correct bill of costs is required to be attached to a writ of execution, so diligence in review of the bill of costs may avoid a later problem in execution. Keep in mind that a writ of execution serves to recover not only taxable costs but the “further costs of executing the writ.” Tex. R. Civ. P. 629.
Pursuant to rule 141, the court may allocate costs otherwise than against the losing party “for good cause, to be stated on the record.” The trial court may also apportion the costs if it determines that neither side entirely prevailed. See Mobil Producing Texas & New Mexico, Inc. v. Cantor, 93 S.W.3d 916, 920 (Tex. App.—Corpus Christi–Edinburg 2002, no pet.) (without citing rule 141, court allocated costs to both parties: “A trial court does not abuse its discretion in taxing costs against both sides where neither party was wholly successful in that one expected to receive more while the other expected to pay less.”).
By statute, recoverable court costs include clerk fees; service fees; fees of the court reporter for the original stenographic transcripts necessarily obtained for use in the suit; fees for masters, interpreters, and guardians ad litem; and “such other costs and fees as may be permitted by these rules and state statutes.” Tex. Civ. Prac. & Rem. Code § 31.007; In re Nalle Plastics Family L.P., 406 S.W.3d 168, 175–76 (Tex. 2013) (orig. proceeding). Other fees required by statute include court-appointed auditor fees (Tex. R. Civ. P. 172), alternative dispute resolution fees for an impartial third party (Tex. Civ. Prac. & Rem. Code § 154.054), and witness fees (Tex. Civ. Prac. & Rem. Code § 22.001).
In general, no fees are allowed for copies of hearing transcripts or depositions. See Tex. Civ. Prac. & Rem. Code § 31.007(b)(2); Tex. R. Civ. P. 140. The appellate courts, however, do not all agree. Compare Crescendo Investments, Inc. v. Brice, 61 S.W.3d 465, 480–81 (Tex. App.—San Antonio 2001, pet. denied) (certified copies of depositions and trial transcripts are recoverable as costs), with Gumpert v. ABF Freight Systems, Inc., 312 S.W.3d 237, 242 (Tex. App.—Dallas 2010, no pet.) (only the original transcript of a deposition is recoverable as costs; the cost to videotape a deposition or for copies of a deposition is not recoverable).
The cost of the transcript on appeal is recoverable as a cost. Bayoud v. Nassour, 408 S.W.2d 344, 345 (Tex. App.—Dallas 1966, writ ref’d n.r.e.). An appellant’s fee for the original transcript covers the cost of an original and one copy. Tex. Gov’t Code § 52.047(c).
In general, expert fees are not recoverable as a cost. Headington Oil Co. v. White, 287 S.W.3d 204, 212 (Tex. App.—Houston [14th Dist.] 2009, no pet.). Nor are miscellaneous expenses which are incurred in the representation of the client. See Shenandoah Associates v. J&K Properties, Inc., 741 S.W.2d 470, 487 (Tex. App.—Dallas 1987, writ denied) (expenses, such as delivery services, travel, long-distance calls, bond premiums, postage, reproduction expenses, brief binding, office air conditioning, and secretarial time are not recoverable as costs); see also Crescendo Investments, 61 S.W.3d at 480–81 (noting that Shenandoah was decided before Tex. Civ. Prac. & Rem. Code § 31.007 became effective, which allows the recovery of costs for trial testimony transcripts).
Texas Rules of Civil Procedure rule 306a requires the following:
When the final judgment or other appealable order is signed, the clerk of the court must immediately send the judgment or order to the parties as provided in Rule 21(f)(10). If the judgment awards monetary damages, the judgment must state: “If you are an individual (not a company), your money or property may be protected from being taken to pay this judgment. Find out more by visiting www.texaslawhelp.org/exempt-property. / Si usted es una persona física (y no una compañía), su dinero o propiedad pudieran estar protegidos de ser embargados como pago de esta deuda decretada en juicio en contra suya. Obtenga mayor información visitando el sitio www.texaslawhelp.org/exempt-property.’ Failure to comply with the provisions of this rule shall not affect the periods mentioned in paragraph (1) of this rule, except as provided in paragraph (4).
§ 20.10Prejudgment Interest Generally
Prejudgment 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.” Ventling v. Johnson, 466 S.W.3d 143, 153 (Tex. 2015) (quoting Johnson & Higgins of Texas, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 528 (Tex. 1998)); Fortitude Energy, LLC v. Sooner Pipe LLC, 564 S.W.3d 167, 188 (Tex. App.—Houston [1st Dist.] 2018, no pet.); Siam v. Mountain Vista Builders, 544 S.W.3d 504, 512 (Tex. App.—El Paso 2018, no pet.). There are two bases for the recovery of prejudgment interest: (1) an enabling statute or (2) principles of equity. Johnson & Higgins of Texas, Inc., 962 S.W.2d at 528; Jones v. Baker, No. 01-22-00013-CV, 2023 WL 5353374, at *7 (Tex. App.—Houston [1st Dist.] Aug. 22, 2023, no pet.) (mem. op.). These bases will be discussed further below. Once the appropriate basis for prejudgment interest has been determined, the interest amount should be calculated and stated in the judgment if possible. The mere recitation of the rate and accrual period often leads to later confusion.
A prayer for general relief does not generally support an award of prejudgment interest under common law. Texas Industries, Inc. v. Lucas, 715 S.W.2d 683, 686–87 (Tex. App.—Houston [14th Dist.] 1986, writ ref’d n.r.e.); Desoto v. Matthews, 714 S.W.2d 133, 135 (Tex. App.—Houston [1st Dist.] 1986), writ ref’d n.r.e., 721 S.W.2d 286 (Tex. 1986); Republic National Bank of Dallas v. Northwest National Bank of Fort Worth, 578 S.W.2d 109 (Tex. 1978). Where prejudgment interest is sought as an element of damages at common law, a plaintiff must specifically plead for it. Bufkin v. Bufkin, 259 S.W.3d 343, 358 (Tex. App.—Dallas 2008, pet. denied). However, if a plaintiff’s claim is based on a statutory or contractual right, a prayer for general relief will support the recovery of prejudgment interest. See Benavidez v. Isles Construction Co., 726 S.W.2d 23, 25 (Tex. 1987); Republic National Bank of Dallas, 578 S.W.2d at 117 (written contract); Olympia Marble & Granite v. Mayes, 17 S.W.3d 437, 441 (Tex. App.—Houston [1st Dist.] 2000, no pet.) (statute). A spreadsheet for calculating costs, attorney’s fees, and interest accrued is at form 20-17.
Practice Note: The law regarding prejudgment interest is not always clear. Accordingly, the practitioner should always consider pleading for equitable prejudgment interest as an alternative; equitable prejudgment interest requires a pleading to support it. If the practitioner does not plead for equitable prejudgment interest, the result could well be that no prejudgment interest is awarded. See Bufkin, 259 S.W.3d at 357–58 (plaintiff failed to show that agreement provided for interest and failed to show that prejudgment interest was available under Texas Finance Code; had plaintiff pleaded for equitable prejudgment interest, it was probably available).
§ 20.10:1Enabling Statute Providing for Prejudgment Interest
The Texas Finance Code includes two enabling statutes relevant for prejudgment interest, but these statutes only apply to claims for wrongful death, personal injury, or property damage (see Tex. Fin. Code § 304.101) and condemnation cases (see Tex. Fin. Code § 304.201). See Fortitude Energy, LLC v. Sooner Pipe LLC, 564 S.W.3d 167, 188 (Tex. App.—Houston [1st Dist.] 2018, no pet.); Siam v. Mountain Vista Builders, 544 S.W.3d 504, 512–13 (Tex. App.—El Paso 2018, no pet.).
However, the standards for calculating prejudgment interest under the common law and under section 304.104 are the same. See Jones v. Baker, No. 01-22-00013-CV, 2023 WL 5353374, at *7, n.4 (Tex. App.—Houston [1st Dist.] Aug. 22, 2023, no pet.) (mem. op.) (citing Johnson & Higgins of Texas, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 531 (Tex. 1998) (expressly adopting legislature’s approach to prejudgment interest and establishing same standard as section 304.104 under common law)). Parties may also contract for interest, provided that the interest is not usurious. “The right to interest is statutory and regulated, but, within such statutory framework, parties are at liberty to contract for the payment of conventional interest.” Triton Oil & Gas Corp. v. E.W. Moran Drilling Co., 509 S.W.2d 678, 687 (Tex. App.—Fort Worth 1974, writ ref’d n.r.e.). If a contract between the parties provides for interest or time-price differential, prejudgment interest may be recovered at the lesser of the rate specified in the contract or 18 percent a year. Tex. Fin. Code § 304.002. In a breach of contract case, the postjudgment interest rate is the same as the prejudgment interest rate. Meridian Hotels, Inc. v. LHO Financing Partnership I, L.P., 255 S.W.3d 807, 823 (Tex. App.—Dallas 2008, no pet.). In a breach-of-contract case, prejudgment interest begins to accrue on the earlier of (1) 180 days after the date a defendant receives written notice of a claim, or (2) the date suit is filed.
§ 20.10:2Equitable Prejudgment Interest
When the claims asserted do not fall within an enabling statute, an award of prejudgment interest is governed by equitable principles. Fortitude Energy, LLC v. Sooner Pipe LLC, 564 S.W.3d 167, 188 (Tex. App.—Houston [1st Dist.] 2018, no pet.); Siam v. Mountain Vista Builders, 544 S.W.3d 504, 513 (Tex. App.—El Paso 2018, no pet.). Generally, a plaintiff is required to plead for prejudgment interest sought in equity as an element of damages. Fortitude Energy, 564 S.W.3d at 188; DeGroot v. DeGroot, 369 S.W.3d 918, 926 (Tex. App.—Dallas 2012, no pet.).
In Johnson & Higgins of Texas, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 532 (Tex. 1998), the Texas Supreme Court extended the reach of section 304.102 of the Texas Finance Code to provide that equitable prejudgment interest in a common law claim was to be calculated in the same manner as under the statute. But see Enterprise Products Operating, LC v. Trafigura AG, No. 01-19-00309-CV, 2020 WL 7213347, at *11 (Tex. App.—Houston [1st Dist.] Dec. 8, 2020, no pet.) (mem. op.) (“When the source for an award of prejudgment interest is general principles of equity, then ‘the decision to award prejudgment interest is left to the sound discretion of the trial court, which should rely upon equitable principles and public policy in making its decision.’”) (quoting Dernick Resources, Inc. v. Wilstein, 471 S.W.3d 468, 487 (Tex. App.—Houston [1st Dist.] 2015, pet. denied)).
Under common law principles, prejudgment interest begins to accrue “on the earlier of (1) 180 days after the date a defendant receives written notice of a claim or (2) the date suit is filed.” Johnson & Higgins of Texas, Inc., 962 S.W.2d at 531. In addition, the Texas Supreme Court has expressly held that when prejudgment interest is awarded based on common law equitable principles, a trial court may not reduce or eliminate a plaintiff’s prejudgment interest award because of delays caused by either party in resolving a case; this is true even if the trial court believes the plaintiff may have engaged in dilatory tactics or acted in bad faith in preventing a timely resolution of the lawsuit. Fortitude Energy, 564 S.W.3d at 188; Siam, 544 S.W.3d at 513.
§ 20.10:3Contract Does Not Provide for Interest
When the interest rate is not specified in a contract, prejudgment interest in a breach of contract case is calculated as simple interest and is based on the postjudgment interest rate applicable at the time of judgment. Johnson & Higgins of Texas, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 532 (Tex. 1998); Siam v. Mountain Vista Builders, 544 S.W.3d 504, 514 (Tex. App.—El Paso 2018, no pet.) (“Section 304.003 of the Texas Finance Code provides the applicable rate for calculating postjudgment interest, and we look to that same interest rate in calculating prejudgment interest as well.”). Texas Finance Code section 304.003(c) provides that a money judgment earns postjudgment interest at one of the three following rates: (1) the prime rate as published by the Board of Governors of the Federal Reserve System on the date of computation; (2) 5 percent a year if the prime rate as published by the Board of Governors of the Federal Reserve System described by Subdivision (1) is less than 5 percent; or (3) 15 percent a year if the prime rate as published by the Board of Governors of the Federal Reserve System described by Subdivision (1) is more than 15 percent. Tex. Fin. Code § 304.003(c)(1)–(3); Siam, 544 S.W.3d at 514. See also Meridian Hotels, Inc. v. LHO Financing Partnership I, L.P., 255 S.W.3d 807, 823 (Tex. App.—Dallas 2008, no pet.) (if the contract does not provide for interest, prejudgment interest and postjudgment interest are set by section 304.003); ExxonMobil Corp. v. Valence Operating Co., 174 S.W.3d 303, 319 (Tex. App.—Houston [1st Dist.] 2005, pet. denied) (where contract did not specify interest, prejudgment interest governed by section 304.003). Interest under section 304.003 is computed as simple interest and accrues 180 days after the date the defendant receives written notice of the claim or the date suit is filed, whichever occurs first. Tex. Fin. Code § 304.104.
Texas Finance Code section 302.002 provides that:
If a creditor has not agreed with an obligor to charge the obligor any interest, the creditor may charge and receive from the obligor legal interest at the rate of six percent a year on the principal amount of the credit extended beginning on the 30th day after the date on which the amount is due.
Some courts have held that section 302.002 does not apply to an award of prejudgment interest, and therefore cannot be the basis for such an award. Walden v. Affiliated Computer Services, Inc., 97 S.W.3d 303, 329–31 (Tex. App.—Houston [14th Dist.] 2003, pet. denied).
Other courts have ruled that section 302.002 does not authorize prejudgment interest because the section appears under a subchapter entitled “Usurious Interest” rather than “Judgment Interest.” See De La Morena v. Ingenieria E Maquinaria De Guadalupe, S.A., 56 S.W.3d 652, 659 (Tex. App.—Waco 2001, no pet.); El Paso Natural Gas Co. v. Lea Partners, L.P., No. 08-01-00310-CV, 2003 WL 21940729, at *10 (Tex. App.—El Paso 2003, pet. denied) (mem. op.).
Finally, one court has interpreted section 302.002 to authorize prejudgment interest at six percent per annum provided that the action involved an extension of credit. See Bufkin v. Bufkin, 259 S.W.3d 343, 357 (Tex. App.—Dallas 2008, pet. denied) (section 302.002 is silent on contracts not involving extensions of credit; accordingly, it applies only to contracts involving the extension of credit).
Nonetheless, some courts, in dictum, have, without much analysis, interpreted section 302.002 to authorize prejudgment interest at 6 percent per annum. See Mobil Producing Texas & New Mexico, Inc. v. Cantor, 93 S.W.3d 916, 920 (Tex. App.—Corpus Christi–Edinburg 2002, no pet.) (section 302.002 would have provided basis for prejudgment interest had the recovery been based on breach of contract); Wallace v. Ramon, 82 S.W.3d 501, 505–06 (Tex. App.—San Antonio 2002, no pet.) (without discussion, applying former version of section 302.002 to support prejudgment interest award on contract claim); Roach v. Dickenson, 50 S.W.3d 709, 714 n.2 (Tex. App.—Eastland 2001, no pet.) (citing amended section 302.002 to award 6 percent prejudgment interest on contract claim where parties agreed that 6 percent was correct amount). The issue of whether section 302.002 authorizes prejudgment interest at a rate of 6 percent when a contract does not specify an interest rate has not been resolved by the Texas Supreme Court.
§ 20.10:4Prejudgment Interest in Personal Injury, Wrongful Death, or Property Damage Case
Prejudgment Interest Required: A judgment in a wrongful death, personal injury, or property damage case earns prejudgment interest. Tex. Fin. Code § 304.102. The Texas Supreme Court has held that “property damage” means “claims for damage to tangible property, not economic loss or loss of economic opportunity.” Johnson & Higgins of Texas, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 530 (Tex. 1998).
Prejudgment Interest Rate: The prejudgment interest rate is equal to the postjudgment interest rate applicable at the time of judgment. Tex. Fin. Code § 304.103. Judgments in these cases earn interest at a rate that is calculated monthly and that is not less than 5 percent nor more than 15 percent, as determined by the Texas Office of Consumer Credit Commissioner. Tex. Fin. Code § 304.003. The consumer credit commissioner shall send to the secretary of state the postjudgment interest rate for publication, and the secretary shall publish the rate in the Texas Register. Tex. Fin. Code § 304.004.
Accrual of Prejudgment Interest: Except as otherwise provided by statute, prejudgment interest accrues on the amount of a judgment during the period beginning on the 180th day after the date the defendant receives written notice of a claim or on the date the suit is filed, whichever is earlier, and ending on the day preceding the date judgment is rendered. Tex. Fin. Code § 304.104. Prejudgment interest is computed as simple interest and is not compounded. Tex. Fin. Code § 304.104.
Effect of Settlement Offers: If a judgment for a claimant is less than the amount of a settlement offer of the defendant, prejudgment interest does not accrue on the amount of the judgment during the period that the offer may be accepted. Tex. Fin. Code § 304.105(a). If a judgment for a claimant is more than the amount of a settlement offer of the defendant, prejudgment interest does not accrue on the amount of the settlement during the period that the offer may be accepted. Tex. Fin. Code § 304.105(b). To prevent the accrual of prejudgment interest, a settlement offer must be in writing and delivered to the claimant or the claimant’s attorney or representative. Tex. Fin. Code § 304.106. If a settlement offer does not provide for cash payment at the time of settlement, the amount of the settlement offer for the purpose of computing prejudgment interest is the cost or fair market value of the settlement offer at the time it is made. Tex. Fin. Code § 304.107.
§ 20.10:5Prejudgment Interest and Attorney’s Fees
Generally, prejudgment interest is not available on an award of attorney’s fees. See C&H Nationwide, Inc. v. Thompson, 903 S.W.2d 315, 325–26 (Tex. 1994) (interpreting Tex. Rev. Civ. Stat. art. 5069–1.05, § 2 (now Tex. Fin. Code § 304.104), the court stated, “we disagree that our approach would allow prejudgment interest on costs and attorney’s fees. These awards cannot fairly be considered a part of the ‘amount of the judgment.’”); Alma Investments, Inc. v. Bahia Mar Co-Owners Ass’n, 497 S.W.3d 137, 146 (Tex. App.—Corpus Christi–Edinburg 2016, pet. denied).
In contrast, however, other appellate courts have recognized an exception to the general rule when the attorney’s fees were paid before judgment. Alma Investments, 497 S.W.3d at 146. See also A.V.I. Inc. v. Heathington, 842 S.W.2d 712, 717–18 (Tex. App.—Amarillo 1992, writ denied) (permitting award of prejudgment interest on paid attorney fees in DTPA action); Nova Casualty Co. v. Turner Construction Co., 335 S.W.3d 698, 706 (Tex. App.—Houston [14th Dist.] 2011, no pet.) (upholding award of prejudgment interest on attorney’s fees paid before judgment); Kurtz v. Kurtz, No. 14-08-00351-CV, 2010 WL 1293769, at *12 (Tex. App.—Houston [14th Dist.] Apr. 6, 2010, no pet.) (mem. op.) (trial court did not abuse its discretion in awarding prejudgment interest on attorney’s fees that had been paid prior to judgment); Williams v. Colthurst, 253 S.W.3d 353, 362 (Tex. App.—Eastland 2008, no pet.) (allowing award of prejudgment interest on attorney’s fees paid prior to judgment in a breach of lease action).
§ 20.10:6Prejudgment Interest Not Available for Future Damages
Prejudgment interest may not be assessed or recovered on an award of future damages. Tex. Fin. Code § 304.1045.
A judgment of a Texas court must state the postjudgment interest rate applicable to that judgment. Tex. Fin. Code § 304.001. However, recent case law has held that interest on a money judgment accrues automatically and is recoverable even if not specifically awarded in the judgment. Accent Builders, Inc. v. Sessions, No. 05-23-00675-CV, 2024 WL 3100696, at *5 (Tex. App.—Dallas June 24, 2024, no pet.) (mem. op.) (citing Bluestone Resources, Inc. v. First National Capital, LLC, 644 S.W.3d 815, 817 (Tex. App.—Dallas 2022, pet. dism’d)); Fortitude Energy, LLC v. Sooner Pipe LLC, 564 S.W.3d 167, 188 (Tex. App.—Houston [1st Dist.] 2018, no pet.).
Judgment interest is defined as “interest on a money judgment, whether the interest accrues before, on, or after the date the judgment is rendered.” Tex. Fin. Code § 301.002(a)(7). Interest is defined as “compensation for the use, forbearance, or detention of money.” Tex. Fin. Code § 301.002(a)(4). The award of postjudgment interest should be as specific as possible so that it may be readily calculated. A stated per diem amount is frequently used to accomplish this objective. A spreadsheet for calculating costs, attorney’s fees, and interest accrued is at form 20-17.
§ 20.11:1Interest Rate or Time-Price Differential in Contract
A judgment of a Texas court on a contract that provides for a specific interest rate or time-price differential earns interest at a rate equal to the lesser of the rate specified in the contract, which may be a variable rate or 18 percent per year. Tex. Fin. Code § 304.002. Postjudgment interest begins accruing on the date the judgment is rendered and ends on the date the judgment is satisfied. Tex. Fin. Code § 304.005(a); Accent Builders, Inc. v. Sessions, No. 05-23-00675-CV, 2024 WL 3100696, at *6 (Tex. App.—Dallas June 24, 2024, no pet.) (mem. op.). Under the Prompt Payment Act, “[a]n unpaid amount required under this chapter begins to accrue interest on the day after the date on which the payment becomes due.” Tex. Prop. Code § 28.004(a); Mulch Matters, Inc. v. Toro Rojo, Inc., No. 01-22-00322-CV, 2024 WL 1862723, at *12 (Tex. App.—Houston [1st Dist.] Apr. 30, 2024, no pet. h.) (mem. op.).
§ 20.11:2Interest Rate or Time-Price Differential Not in Contract
A Texas court judgment to which Texas Finance Code section 304.002 does not apply, including court costs awarded in the judgment and any prejudgment interest, earns postjudgment interest at a rate determined by the prime rate as published by the Federal Reserve Bank of New York on the date of the computation. However, if that rate is less than 5 percent, the postjudgment interest rate is 5 percent; if that rate is more than 15 percent, the postjudgment interest rate is 15 percent. Tex. Fin. Code § 304.003. The current applicable rate can be found on the website of the Texas Office of Consumer Credit Commissioner at https://occc.texas.gov.
§ 20.11:3Accrual of Postjudgment Interest
Postjudgment interest on a judgment of a Texas court accrues during the period beginning on the day the judgment is rendered and ending on the day the judgment is satisfied. Tex. Fin. Code § 304.005(a); Ventling v. Johnson, 466 S.W.3d 143, 152 (Tex. 2015). Postjudgment interest compounds annually. Tex. Fin. Code § 304.006. Postjudgment interest on a conditional award of appellate attorney’s fees, however, does not commence to accrue interest until the award is made final by the appropriate appellate court’s judgment. Ventling, 466 S.W.3d at 156.
All judgments should state the date of signing. Tex. R. Civ. P. 306a(2). The date that the judgment was signed, as opposed to the date the judgment was rendered or entered, is the operative date for purposes of calculating deadlines for postjudgment motions and appeal. See Tex. R. Civ. P. 306a(1); Burrell v. Cornelius, 570 S.W.2d 382, 384 (Tex. 1978). For this reason, the judgment should be presented for signature as soon as possible after rendition so that execution or other collection steps will not be delayed. See also Tex. R. Civ. P. 627 (clerk upon request shall issue execution after thirty days after judgment signed, or after thirty days after motion for new trial or motion in arrest of judgment is overruled by order or by operation of law).
There is a limited exception to this general rule, however. If within twenty days after the judgment is signed, a party adversely affected by it or his attorney has not received notice under rule 306a(3), and does not have actual knowledge of the judgment, the periods for filing postjudgment motions and appeal commence on the date of receipt of notice under rule 306a(3), or on the date that actual knowledge of the signing was acquired, whichever occurs first, but in no event will such periods begin more than ninety days after the original judgment or other appealable order was signed. Tex. R. Civ. P. 306a(4).
When the final judgment is signed, the clerk must immediately send the judgment or order to the parties unless the judgment is sealed, when access is restricted by law or court order, or where an unrepresented party has not provided an email address. Tex. R. Civ. P. 21(f)(10), 306a(3). The clerk’s failure to send the notice, however, does not affect the timetable for filing an appeal, unless the party establishes that it did not receive the notice or acquire actual knowledge of the judgment within twenty days after the judgment was signed. In that case, the time to appeal begins on the date of actual receipt of the notice or the date actual knowledge of the judgment was acquired, whichever occurred first, but in no event shall the period begin more than ninety days after the judgment was signed. Tex. R. Civ. P. 306a(4). See Western Import Motors v. Mechinus, 739 S.W.2d 125, 126 (Tex. App.—San Antonio 1987, no writ) (per curiam) (letter from adverse party’s attorney containing proposed judgment, requesting that any objections be raised in seventy-two hours, and stating that if no objections were raised in that time court would be requested to sign judgment on certain date did not give actual knowledge of judgment so as to preclude extension of timetable under rule 306a(4)). However, this rule does not apply and cannot serve to extend a trial court’s plenary power when a party learns of a final judgment more than ninety days after it is signed. In re The Lynd Co., 195 S.W.3d 682, 684 (Tex. 2006).
Practice Note: To attempt to protect against a claim of “no notice” of a final judgment, the plaintiff’s attorney should consider sending a copy of the signed judgment to the defendant’s attorney of record by certified or registered mail, return receipt requested.
The clerk of the court “shall issue execution to enforce [the] judgment.” Tex. R. Civ. P. 622. Although no statute or rule specifically requires language of execution in the judgment, the better practice is to include in the judgment a statement specifically authorizing execution (and, as appropriate, such other writs as a writ of possession or an order of sale) to satisfy the judgment. Some clerks will not issue writs of execution without such language.
Only one final judgment shall be rendered in any cause except where it is otherwise specially provided by law. Tex. R. Civ. P. 301.
If a judgment is rendered after a conventional trial on the merits, it will be presumed, for appeal purposes, that the court intended to and did dispose of all parties and issues unless the trial court ordered a separate trial to resolve a specific issue. Vaughn v. Drennon, 324 S.W.3d 560, 562–63 (Tex. 2010) (per curiam); Moritz v. Preiss, 121 S.W.3d 715, 718–19 (Tex. 2003); Wright v. Liming, ___ S.W.3d ___, No. 01-23-00487-CV, 2024 WL 3451028, at *3 (Tex. App.—Houston [1st Dist.] July 18, 2024, no pet.); see Tex. R. Civ. P. 174(b) (permitting trial courts to “order a separate trial of any claim, cross-claim, counterclaim, or third-party claim, or of any separate issue or of any number of claims, cross-claims, counterclaims, third-party claims, or issues” to further convenience or avoid prejudice). If there has been a full trial on the merits either to the bench or before a jury, the inclusion of a “Mother Hubbard” clause—a clause stating that “all relief not granted is denied”—indicates the court’s intention to finally dispose of the entire matter, assuming that a separate or bifurcated trial is not ordered. See Wright, 2024 WL 3451028, at *2 (following a conventional trial on the merits, and despite the inclusion of the finding in the judgment that it “finally disposes of all parties and all claims and is appealable,” the judgment was not final since it expressly reserved, for future consideration, the calculation of attorney’s fees). Nonetheless, prudent practice dictates that language of finality should be included in such a judgment.
“No such presumption of finality arises from a default judgment.” In re Burlington Coat Factory Warehouse of McAllen, Inc., 167 S.W.3d 827, 829 (Tex. 2005); Houston Health Clubs, Inc. v. First Court of Appeals, 722 S.W.2d 692, 693 (Tex. 1986); Wright, 2024 WL 3451028, at *3. “[A] judgment issued without a conventional trial is final for purposes of appeal if and only if either it actually disposes of all claims and parties then before the court, regardless of its language, or it states with unmistakable clarity that it is a final judgment as to all claims and all parties.” Lehmann v. Har-Con Corp., 39 S.W.3d 191, 192–93 (Tex. 2001); see also Farm Bureau County Mutual Insurance Co. v. Rogers, 455 S.W.3d 161, 163 (Tex. 2015) (per curiam) (the language of a judgment can make it final, even though it should have been interlocutory, if the language expressly disposes of all claims and all parties, unless it does not in fact dispose of all claims (here, attorney’s fees)); Ford v. Exxon Mobil Chemical Co., 235 S.W.3d 615, 617 (Tex. 2007) (per curiam).
If, on the other hand, the judgment does not follow a conventional trial, but instead was a default judgment, a summary judgment, a nonsuit, a determination of a plea to the jurisdiction, a plea in abatement, a dismissal for want of prosecution, or similar order, the standard is different. In such cases, the judgment or order is final for purposes of appeal if, and only if, it either actually disposes of all claims and parties before the court, regardless of its language, or states with unmistakable clarity that it is a final judgment as to all claims and all parties. Lehmann, 39 S.W.3d at 192–93. “If the judgment clearly and unequivocally states that it finally disposes of all claims and parties, the assessment is resolved in favor of finding finality, and the reviewing court cannot review the record.” Patel v. Nations Renovations, LLC, 661 S.W.3d 151, 154 (Tex. 2023). A judgment or order does not dispose of all claims and parties merely because it is titled “final” or because the word “final” appears elsewhere in the judgment or order, or because it awards costs. Farm Bureau, 455 S.W.3d at 163; Lehmann, 39 S.W.3d at 203–04 (overruling Mafrige v. Ross, 866 S.W.2d 590 (Tex. 1993)). Nor does a judgment or order completely dispose of a case merely because it states that it is appealable; even interlocutory orders may sometimes be appealable. Lehmann, 39 S.W.3d at 205–06. The inclusion of a “Mother Hubbard” clause (“all relief not granted is denied” or similar language) does not indicate that a judgment rendered without a conventional trial is final for purposes of appeal. Farm Bureau, 455 S.W.3d at 163; Lehmann, 39 S.W.3d at 203–04 (overruling Mafrige, 866 S.W.2d 590); see also Bovee v. Houston Press LLP, No. 10-16-00051-CV, 2016 WL 1274755, at *1–2 (Tex. App.—Waco Mar. 31, 2016, no pet.) (mem. op.) (order entitled “Final Judgment” and including a “Mother Hubbard” clause (“All relief not expressly granted herein is denied”) was not a final judgment where it was clear that the order did not adjudicate all claims); Youngblood & Associates, P.L.L.C. v. Duhon, 57 S.W.3d 63, 65 (Tex. App.—Houston [14th Dist.] 2001, no pet.) (order entitled “final summary judgment” that included “Mother Hubbard” clause did not dispose of all claims and parties and was therefore not final appealable order).
While “no magic language is required” to satisfy the clear-and-unequivocal standard, merely stating that the order is “final” or “appealable,” including a Mother Hubbard clause, or awarding costs is not sufficient. Bella Palma, LLC v. Young, 601 S.W.3d 799, 801 (Tex. 2020) (per curiam). Instead, “a trial court may express its intent to render a final judgment by describing its action as (1) final, (2) a disposition of all claims and parties, and (3) appealable.” Bella Palma, LLC, 601 S.W.3d at 801 (citing In re R.R.K., 590 S.W.3d 535, 543 (Tex. 2019)); Winton Mortgage Co. v. Livingston, No. 08-23-00184-CV, 2024 WL 3917019, at *6 (Tex. App.—El Paso Aug. 23, 2024, no pet.) (mem. op.) (“Though the default judgment order was titled ‘Final Judgment for Plaintiff and Dismissal of Counterclaims Pursuant to 165 Tex. R. Civ. P.’ and included a Mother Hubbard clause, it did not contain “a clear and unequivocal statement of finality” sufficient to render the judgment final, as it did not state that it disposed of all claims and parties or was appealable.”).
If the appellate court is uncertain about the intent of the order, it can abate the appeal to permit clarification by the trial court. Lehmann, 39 S.W.3d at 206. Further, the appellate court can examine the judgment sua sponte to determine its finality. See Freedom Communications, Inc. v. Coronado, 372 S.W.3d 621, 624 (Tex. 2012) (“[W]e must consider our jurisdiction, even if that consideration is sua sponte.”); Lehmann, 39 S.W.3d at 205–06 (“To determine whether an order disposes of all pending claims and parties, it may of course be necessary for the appellate court to look to the record in the case .... [I]f the record reveals the existence of parties or claims not mentioned in the order, the order is not final.”); Winton Mortgage Co., 2024 WL 3917019, at *6 (pleading containing a claim for exemplary damages was not addressed in the judgment).
Practice Tip: Finality of judgment is complex and potentially dangerous. See In re Daredia, 317 S.W.3d 247 (Tex. 2010) (per curiam) (inadvertent dismissal of guarantor on $700,000 judgment); Lehmann, 39 S.W.3d at 191. Finality language should never be used on an interlocutory or partial judgments. Review every proposed judgment to ensure it is final and should include finality language.
[Sections 20.16 through 20.20 are reserved for expansion.]
§ 20.21Default Judgment in General
A defendant who does not file a timely response to a petition risks entry of default judgment against him. At any time after a defendant is required to answer, the plaintiff may in turn take judgment by default against such defendant if he has not previously filed an answer, provided the return of service has been on file with the clerk for the required length of time required by rule. Tex. R. Civ. P. 107(h), 239. See also Gerdes v. Marion State Bank, 774 S.W.2d 63, 65 (Tex. App.—San Antonio 1989, writ denied) (default judgment reversed when ten-day requirement for return of service not met); Gentry v. Gentry, 550 S.W.2d 167, 167 (Tex. App.—Austin 1977, no writ) (default judgment reversed when granted on same day return filed).
Practice Note: The mechanics of obtaining a default judgment vary from court to court. The practitioner should review the local rules for the county and the particular court customs before seeking the default judgment.
§ 20.22Return on File for Ten Days
For a default judgment to be granted, the return of service must have been on file for ten days before judgment, excluding the day of filing and the day of judgment. Gentry v. Gentry, 550 S.W.2d 167 (Tex. App.—Austin 1977, no writ); Tex. R. Civ. P. 107, 239. Under rule 103, citation may be served, and under rule 107 returned, by any person at least eighteen years old who is authorized by law or court order to serve citations. The return of service must be signed by such an authorized person, and if signed by a person other than a sheriff, constable, or clerk of the court, the return must either be verified or be signed under penalty of perjury. Tex. R. Civ. P. 107(e). A return signed under penalty of perjury must include the statement prescribed in Tex. R. Civ. P. 107(e).
§ 20.23Certificate of Last Known Email and Mailing Address
At or immediately before rendition of an interlocutory or final default judgment, the prevailing party or his attorney must certify to the clerk in writing the last known email and mailing address of the party against whom the judgment is taken. Tex. R. Civ. P. 239a. Immediately after the judgment is signed, the clerk must send the judgment or order to the parties as provided in Rule 21(f)(10). Tex. R. Civ. P. 306a(3). If a party has not provided an email address and consequently compliance with Rule 21(f)(10) is impossible, then the clerk should use an alternative method to send orders, notices, and documents to that party. See Comment to 2023 changes. See form 20-2 in this chapter for a certificate of last known email and mailing address.
§ 20.24Compliance with Servicemembers Civil Relief Act
If the defendant has defaulted in appearing, before entering judgment the plaintiff must file an affidavit, commonly referred to as a nonmilitary affidavit, “stating whether or not the defendant is in military service and showing necessary facts to support the affidavit” or “stating that the plaintiff is unable to determine whether or not the defendant is in military service.” 50 U.S.C. § 3931(b)(1). The failure to file such an affidavit renders a default judgment voidable if the record reflects that the defendant was in military service. Goshorn v. Brown, No. 14-02-00852-CV, 2003 WL 22176976, at *3 (Tex. App.—Houston [14th Dist.] Sept. 23, 2003, no pet.) (mem. op.) (plaintiff’s failure to comply with the Soldiers’ and Sailors’ Civil Relief Act by not filing an affidavit before entry of default judgment did not require trial court to set aside the judgment where evidence showed defendant was not in the military at the time of the underlying suit). If it appears that the defendant is in the military service, the court may not enter a judgment without appointing an attorney to represent the defendant. 50 U.S.C. § 3931(b)(2). If the court is unable to determine whether the defendant is in military service, the court may require the plaintiff to file a bond to indemnify the defendant against any loss he may suffer by reason of the judgment should it thereafter be set aside. 50 U.S.C. § 3931(b)(3). There are no Texas cases, statutes, or rules on this requirement, and it is not consistently enforced throughout the state. The Department of Defense Manpower Data Center (DMDC) hosts a Servicemembers Civil Relief Act website that will provide the current active military status of an individual. To obtain certificates of service or nonservice, the practitioner can access the public website at https://scra.dmdc.osd.mil. The website is of relatively limited value without a Social Security number. Social Security numbers may be obtained through the use of various services, such as www.tlo.com. There is no charge for a certificate. The certificate should then be attached to the nonmilitary affidavit. If there is insufficient personal information to use this site, an individual’s active duty status may be verified through the military services. Contact information for each service headquarters is listed on the Department of Defense website at www.defense.gov.
See form 20-3 in this chapter for a nonmilitary affidavit. See section 2.78:9 in this manual for additional discussion of default judgments against service members.
See chapter 16 of this manual regarding citation and service.
Damages will be assessed by the court in a default judgment “if the claim is liquidated and proved by an instrument in writing.” Tex. R. Civ. P. 241. Damages may not be assessed without presenting evidence unless the claim is liquidated—that is, if the amount due can with sufficient certainty be calculated by the court solely from the instrument sued on and the factual, as opposed to conclusory, allegations of the petition. Fears v. Mechanical & Industrial Technicians, 654 S.W.2d 524, 530 (Tex. App.—Tyler 1983, writ ref’d n.r.e.); Burrows v. Bowden, 564 S.W.2d 474, 475 (Tex. App.—Corpus Christi–Edinburg 1978, no writ); see Michael Pohl & David Hittner, Judgments by Default in Texas, 37 Sw. L.J. 421, 436 (1983).
To support a default judgment, the court must hear sufficient evidence on all unliquidated damages. Holt Atherton Industries v. Heine, 835 S.W.2d 80, 83 (Tex. 1992); Tex. R. Civ. P. 243. See also Otis Elevator Co. v. Parmelee, 850 S.W.2d 179, 181 (Tex. 1993) (trial court, on imposing case-determinative discovery sanctions, improperly awarded unliquidated damages without hearing evidence). A party seeking a default judgment should therefore always request a transcript be taken of the hearing. If the court requires a filed motion for default judgment, affidavit(s) in support of the unliquidated damages, including an affidavit from the attorney to support an award of attorney’s fees, should be incorporated into the motion. Texas Commerce Bank, N.A. v. New, 3 S.W.3d 515, 516–17 (Tex. 1999); Ingram Industries v. U.S. Bolt Manufacturing, 121 S.W.3d 31, 37 (Tex. App.—Houston [1st Dist.] 2003, no pet.). Unliquidated damages include the following:
1.Any damages not proved by an instrument in writing. See Tex. R. Civ. P. 243. Typically, a balance on a promissory note is a liquidated damage because the difference between the amount of indebtedness alleged to be due and the face amount of the note does not create ambiguity or raise a question of fact regarding payment credits. 7677 Group, L.P. v. SMS Financial JDC, L.P., No. 01-21-00376-CV, 2023 WL 8587649, at *12, n.9 (Tex. App.—Houston [1st Dist.] Dec. 12, 2023, no pet.) (mem. op.); In re Northern Natural Gas Co., 327 S.W.3d 181, 187 (Tex. App.—San Antonio 2010, orig. proceeding). An affidavit setting forth the total balance due on a note is generally sufficient to sustain summary judgment, and detailed proof of the balance is not required. FFP Marketing Co. v. Long Lane Master Trust IV, 169 S.W.3d 402, 411 (Tex. App.—Fort Worth 2005, no pet.); Grace Creek Development, LP v. REM-K Builders, Ltd., No. 12-16-00184-CV, 2017 WL 2351523, at *3 (Tex. App.—Tyler May 31, 2017, pet. denied) (mem. op.). There may be situations, however, when the pleadings and written instrument are not sufficient to enable the court to make an accurate calculation of the amount due. See Guerra v. M.H. Equities, Ltd., No. 02-11-00261-CV, 2012 WL 2135596, at *2 (Tex. App.—Fort Worth June 14, 2012, no pet.) (mem. op.) (unlike cases in which damages can be calculated as a matter of law based on the face amounts of the note and the pleadings, it was unclear how the note balance was calculated).
2.Attorney’s fees: “Attorney’s fees are by their very nature unliquidated unless the exact amount is fixed by agreement.” Rouhana v. Ramirez, 556 S.W.3d 472, 478 (Tex. App.—El Paso 2018, no pet.). See chapter 31 for more information about proving up attorney’s fees.
3.“Collection expenses” (in addition to attorney’s fees) if the written instrument does not fix the exact amount. Odom v. Pinkston, 193 S.W.2d 888, 891 (Tex. App.—Austin 1946, writ ref’d n.r.e.). Note: some trial courts will not allow the recovery of additional attorney’s fees for postjudgment collection.
If unliquidated damages are not supported by affidavit and are instead supported by live testimony, a record should be made in order to protect your judgment on appeal.
§ 20.26:3Judgment Awards More Damages Than Amount Pleaded
A default judgment must be in accord with the pleadings. It is impermissible in a default judgment to render judgment for damages in excess of the damages specifically pleaded. Simon v. BancTexas Quorum, N.A., 754 S.W.2d 283, 286 (Tex. App.—Dallas 1988, writ denied). But a party can seek permission to amend the petition to increase damages post-verdict or post-court ruling. Greenhalgh v. Service Lloyds Insurance Co., 787 S.W.2d 938, 940 (Tex. 1990); Nathan v. USAA General Indemnity, No. 05-23-00106-CV, 2024 WL 1925864, at *2 (Tex. App.—Dallas May 2, 2024, no pet.) (mem. op.).
Judgment nihil dicit, wherein no answer placing the merits in issue is on file, is a form of default judgment. Stoner v. Thompson, 578 S.W.2d 679, 683 (Tex. 1979). Although there is a difference between a no-answer default judgment and a judgment nihil dicit, they are so similar that the same rules generally apply to each with respect to the effect and validity of the judgment. In both instances the nonanswering party has admitted the facts properly pleaded and the justice of the opponent’s claim, though a judgment nihil dicit carries a stronger confession than does a default judgment. Stoner, 578 S.W.2d at 682. But see Roberts v. Mullen, 446 S.W.2d 86, 89 (Tex. App.—Dallas 1969, writ ref’d n.r.e.) (such implied admission not always absolute and subject to rebuttal).
Judgment nihil dicit is usually limited to situations in which the defendant has entered some plea, usually dilatory, which has not placed the merits of the plaintiff’s case in issue, or the defendant has placed the merits in issue by filing an answer, but the answer has been withdrawn. Frymire Engineering Co. v. Grantham, 524 S.W.2d 680, 681 (Tex. 1975).
A party who permits a judgment nihil dicit impliedly confesses judgment and waives all errors in pleading or proof that are not fundamental or jurisdictional, except those that the record shows were not intended to be waived. In re R.K.P., 417 S.W.3d 544, 549 (Tex. App.—El Paso 2013, no pet.); O’Quinn v. Tate, 187 S.W.2d 241, 245 (Tex. App.—Texarkana 1945, writ ref’d).
A judgment nihil dicit must accord with the pleadings so that the amount and terms of the judgment are ascertainable by reference to the petition. Mullen v. Roberts, 423 S.W.2d 576, 579 (Tex. 1968); Badaiki v. Pine Forest Park Place, No. 14-22-00614-CV, 2023 WL 8270987 (Tex. App.—Houston [14th Dist.] Nov. 30, 2023, no pet.) (mem. op.). Although the rules of procedure do not address how to obtain a judgment nihil dicit, a motion for entry of such a judgment is an effective method. Alternatively, the party should consider filing a motion for summary judgment.
A judgment nihil dicit is at form 20-7 in this chapter.