Opinion
No. 09-09-00297-CV
Submitted on January 14, 2010.
Opinion Delivered May 6, 2010.
On Appeal from the 128th District Court Orange County, Texas, Trial Cause No. A-040181-C.
Before McKEITHEN, C.J., GAULTNEY and KREGER, JJ.
MEMORANDUM OPINION
Patrick Hudson brought suit against Farmers Insurance for breach of contract. The jury rendered a verdict against Farmers, finding that it breached Hudson's agent appointment agreement ("Agent Agreement") when it terminated his agency, and awarding Hudson $380,000 in lost profits, together with attorney's fees. Farmers appeals the jury's verdict. We conditionally affirm the judgment.
Farmers Insurance Exchange, Truck Insurance Exchange, Mid-Century Insurance Company, Farmers New World Life Insurance Company, Mid-Century Insurance Company of Texas, Texas Farmers Insurance Company, and Farmers Texas County Mutual Insurance Company (collectively hereinafter "Farmers").
BACKGROUND
Hudson became an agent of Farmers in 1992. John and Donna Clark (the "Clarks") were insured through Farmers from June 26, 2002, through June 26, 2003. Farmers automatically renewed the policy from June 26, 2003, through June 23, 2004, subject to payment of the required premium. On or about June 20, 2003, Hudson submitted an application for homeowners' insurance on behalf of the Clarks to Southeast Surplus Underwriters, which issued a homeowners' policy for the Clarks with effective dates of June 26, 2003, through June 26, 2004. Farmers contended that Hudson was guilty of "switching," in violation of the terms of his Agent Agreement, and terminated Hudson's agency on April 26, 2004. Hudson's termination was made effective on April 30, 2004. Following his termination, Farmers paid Hudson the contract value accrued through that date pursuant to the terms of his Agent Agreement. Hudson filed suit against Farmers alleging that Farmers had breached Hudson's Agent Agreement by wrongfully terminating Hudson without cause and without proper notice.
Hudson testified at trial that "contract value" is a contract benefit similar to retirement. Contract value is value which accumulates over time as an agent continues to sell insurance policies for Farmers. As long as an agent continues to sell policies, his contract value builds. The contract value is a benefit paid by Farmers when the agency is terminated.
At trial, Farmers presented evidence that it had terminated Hudson in accordance with the terms of his Agent Agreement for switching customers to other insurance carriers while they remained eligible for Farmers Insurance. While the Agent Agreement does not define switching, the parties agreed at trial that switching is "the act of replacing one company's [insurance] policy with another company's [insurance] policy while the first policy remains in force and remains eligible to be written by the first [insurance] company[.]" The allegation of switching was based primarily on one transaction between Hudson and the Clarks. At trial, Farmers took the position that because Hudson switched the Clark's homeowners' policy from Farmers to Southeast Surplus Lines in violation of the terms of the Agent Agreement, Hudson was properly terminated. Hudson maintained at trial that he did not engage in switching.
Farmers also questioned Hudson at trial about allegedly switching other customers.
Hudson testified that if a potential customer was not eligible or acceptable to Farmers, the agents were allowed to place the customer with an outside company. Hudson explained that in 2001 he received a letter from Farmers stating that he was placing too many high risk customers into Farmers automobile insurance policies. Farmers placed Hudson on "submit for approval" ("SFA") status under which Farmers would only accept automobile insurance applications from Hudson after he first obtained underwriter approval. Hudson testified that as a result of being placed on SFA status he "tightened up" on his underwriting and "looked at people harder." As his customers' auto policies came up for renewal he "checked their loss ratios" and "worked on getting the best of the best." Hudson testified that he was not required to request permission from Farmers to place customers who did not meet the new stricter underwriting guidelines under the SFA status with an outside company. In June of 2001, Hudson received an "underwriting contract value bonus" from Farmers for staying "focused" and maintaining a "profitable book of auto business."
Hudson testified that in April of 2002 he was placed on SFA status with respect to Farmers' homeowners' insurance policies. Hudson explained that Farmers was "going through the mold crisis" and wanted to do the best they could to make a profit. According to Hudson, the level of risk Farmers was willing to accept on new business changed as a result of "the mold crisis," and Farmers became stricter with respect to underwriting. After being placed on SFA status with respect to Farmers' homeowner policies, Hudson testified he did the same thing he had done after being placed on SFA status with regard to Farmers' auto policies in 2001: he "relooked at everything that was renewing," evaluated loss ratios and did the very best he could to "tighten up [his] book of business." This meant Hudson accepted fewer Farmers customers and was tougher on eligibility. Those customers who did not meet with his re-underwriting standards were sold policies through other carriers. Hudson was still on SFA status when he was terminated.
The "mold crisis" refers to the large number of mold claims being filed under Farmers' HO-B (all risks policy) on or around 2001.
Hudson testified at trial regarding the Clark transaction. Hudson stated that Donna Clark's insurance application was submitted to Southeast Surplus Underwriters, as opposed to Farmers, because she did not meet the stricter re-underwriting criteria as she had a claim on her homeowners' policy within the preceding five years and she was declined insurance by Farm Bureau, a standard insurance company. Hudson further testified that on her insurance application, Donna Clark identified her previous insurance carrier as Farm Bureau. According to Hudson, Clark did not tell him that she may have been insured by Farmers at the time of the application.
Donna Clark also testified at trial. Clark testified that because her insurance rates for renewal of her homeowners' policy with Farmers had increased substantially, she decided to switch her homeowners' policy from Farmers to Farm Bureau. Clark testified that despite receiving the notice of renewal from Farmers, she instructed her lender not to pay the renewal premium for her homeowners' policy with Farmers. Clark met with an agent at Farm Bureau, received a quote, and paid a fee to bind coverage with Farm Bureau during its underwriting process. Farm Bureau declined to write the policy because Clark had recovered on a homeowners' insurance claim within the preceding five years. Farm Bureau sent Clark notice on May 30, 2003, that its coverage would extend only through June 29, 2003. Because Clark still needed homeowners' insurance, the agent at Farm Bureau recommended she contact Pat Hudson. Hudson had not previously sold insurance to the Clarks.
Clark called Hudson's office and spoke with his secretary, who prepared Clark's application. Hudson's secretary then brought the application to Clark for her signature and took pictures of her home. Clark explained that the insurance application she filled out for Hudson stated that she was insured by Farm Bureau because Clark thought she was insured with Farm Bureau. Clark testified that Farmers may have sent her a renewal policy offer, but she "probably chunked it because [she] knew that [she] was not going to . . . renew."
After hearing the evidence, the jury declined to find that Hudson had "switched" customers but instead, found that Farmers breached the terms of Hudson's Agent Agreement when it terminated him for switching. The jury awarded Hudson $380,000 in lost profits, together with attorneys' fees. Farmers asserts five issues on appeal. Farmers argues (1) there is legally insufficient evidence to support the jury's award of damages; (2) there is legally insufficient evidence to support the jury's finding that Farmers breached the agreement; (3) there is factually insufficient evidence to support the jury's verdict and the award of damages; (4) the trial court erred in admitting expert testimony; and (5) the trial court erred in awarding pre-judgment interest.
BREACH OF THE AGREEMENT
In issues two and three, Farmers argues that the evidence is legally and factually insufficient to support the jury's finding that Farmers breached the Agent Agreement when it terminated Hudson for switching. In reviewing the legal sufficiency of the evidence, we determine whether the evidence "would enable reasonable and fair-minded people to reach the verdict under review." City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). We "credit favorable evidence if reasonable jurors could, and disregard contrary evidence unless reasonable jurors could not." Id. Additionally, we view the evidence in the light most favorable to the verdict, and indulge every reasonable inference that would support it. Id. at 822. In reviewing the factual sufficiency of the evidence, we consider all the evidence, and set aside the verdict only if the evidence is so weak or the finding is so against the great weight and preponderance of the evidence that it is clearly wrong and unjust. See Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986).
Farmers argues that the evidence establishes as a matter of law that Hudson engaged in switching in violation of the Agent Agreement and was properly terminated for cause. We disagree. While Hudson agreed that he placed the Clarks with an outside company while Farmers had offered to renew their homeowners' policy, Hudson disputed that the Clarks were eligible for renewal by Farmers under the stricter re-underwriting guidelines he implemented as a result of his SFA status. The evidence presented at trial established that Hudson was initially placed on SFA status with respect to Farmers' auto insurance policies in 2001. After Hudson "tightened up his underwriting" and screened the insurance applicants more carefully (i.e. moved those he deemed high risk insureds to outside companies), he was rewarded by Farmers with a contract value bonus for maintaining a profitable book of business. Hudson explained that the letter he received from Farmers in 2002 placing him on SFA status with respect to Farmers' homeowner policies, referenced the fact that Hudson had been placed on SFA status in 2001, and explained that the objective of placing Hudson on SFA status in 2002 was to assist him in improving his business performance "through improved risk selection, rate administration, re-underwriting, and improved marketing practices." The letter further stated, "[d]ue to the severity of your agency's business profitability problems, your agency will remain on this program" with respect to "new business/households."
Hudson told the jury that just as he had done with respect to Farmers' automobile insurance policies, Hudson screened home insurance applicants more carefully. On cross-examination, the following exchange took place, during which Hudson explained why he placed some customers who may have been eligible for Farmers homeowners' insurance policies with outside companies:
[Hudson]: When you say `eligible Farmers policyholders,' I was re-underwriting those policies. . .
. . . .
. . . [If I] decided they weren't eligible or weren't fitting in that book of business, the best of the best that Farmers wanted, I re-underwrit [sic] them and did put them elsewhere or they left the agency.
. . . [I]f they were eligible for Farmers but I thought they had a problem, I sent them on down the road to clean up that book. . . ."
. . . [I]f I made a decision not to place them in Farmers, they were no longer eligible. I was the last line of underwriting for Farmers.
When questioned regarding allegations that Hudson switched other customers, he explained, "I was Farmers. We were re-underwriting our book of business as I was instructed to do . . . I had been successful at it before." Hudson explained that with every Farmers customer he had to write to an outside company as a result of his SFA status, the loss of the Farmers policy affected him directly.
The contract value of Hudson's Agent Agreement increased with every policy written with Farmers.
At trial, Farmers presented evidence from several witnesses, including Mark Lipke, the division marketing manager for Farmers who was responsible for investigating the complaint that Hudson switched the Clarks. Lipke testified that the Southeast Surplus Underwriters policy showed insurance coverage for the Clarks for a policy period beginning June 26, 2003, to June 26, 2004. Lipke further testified that the renewal declaration page for the Clarks' Farmers policy established insurance coverage for the identical policy period. Lipke explained that the Clarks were covered by their Farmers policy from June 26, 2003, until October 4, 2003, when that policy was cancelled. Lipke stated that as part of his investigation into the switching allegation, he contacted Farmers' underwriting department to determine whether the Clarks were still eligible and the underwriting department confirmed "that there was coverage in force" during the time period reflected by the policy.
Lipke testified that when he met with Hudson to discuss the switching allegations, Hudson explained he placed the Clarks with an outside company because the Clarks' insurance application "was not acceptable to Farmers." According to Lipke, the prior fire loss suffered by the Clarks and the fact that they were declined by Farm Bureau was not enough to render them ineligible for Farmers insurance under Farmers' underwriting guidelines. Lipke testified that notwithstanding Hudson's explanation, he concluded that Hudson engaged in switching. Farmers also provided testimony from an expert witness who reviewed Hudson's files and testified that he concluded that Hudson had switched the Clarks and that there were eighteen other instances of switching that were apparent from his review of Hudson's files.
The jury is the sole judge of the credibility of the witnesses and the weight to be given their testimony. Golden Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757, 761 (Tex. 2003). It is within the jury's province "to resolve conflicts in the evidence." City of Keller, 168 S.W.3d at 820. Consequently, when "reviewing all the evidence in a light favorable to the verdict, [the reviewing court] must assume that [the jury] resolved all conflicts" in the evidence consistent with the jury's verdict. Id. Where "reasonable jurors could resolve conflicting evidence either way, [the reviewing court] must presume [the jury] did so in favor of the [jury verdict,] and disregard the conflicting evidence in [a] legal sufficiency review." Id. at 821.
Hudson explained to the jury that while potential customers may have been eligible for Farmers insurance under the company's formal underwriting guidelines, he placed customers he evaluated as being higher risk with other companies because Farmers had instructed him to improve his underwriting performance through "improved risk selection [and] re-underwriting. . . ." Based on the evidence presented, reasonable jurors could have determined that Hudson was not guilty of "switching" and that Farmers breached the Agent Agreement when it terminated Hudson without notice. Additionally, we find the evidence is not so weak or against the great weight and preponderance of the evidence that it is clearly wrong or unjust. We find the evidence legally and factually sufficient to support the jury's finding that Fanners breached the terms of the Agent Agreement when it terminated Hudson's agency. We overrule issue two and that portion of issue three challenging the factual sufficiency of the evidence supporting the jury's breach of contract verdict.
DAMAGES
Farmers challenges the legal and factual sufficiency of the evidence supporting the jury's damages award in issues one and three. Hudson's damages expert, Harold Ingersoll, testified regarding Hudson's estimated lost profits. Ingersoll estimated Hudson suffered pretrial lost profits in the amount of $489,306. Ingersoll further testified that he estimated lost profits post-trial through the projected date of retirement in the amount of $436,167. Total lost profits through Hudson's anticipated date of retirement were estimated at $836,475. Ingersoll estimated the total lost profits through the projected date of death at $1,105,359 and the present value of post-trial lost profits through the projected date of death at $705,050. The jury awarded Hudson $380,000 in lost profits.
Ingersoll testified that Farmers' payment to Hudson for his contract value in the amount of $157,727 was deducted from this amount.
Proper Measure of Damages
In issue one, Farmers argues Texas law limits Hudson's damages to a maximum of three months' lost profits because "three months [is] the maximum amount of time Farmers is required to give for notice of termination under the Agreement." In issue three, Farmers argues that remand is appropriate when excessive damages are awarded. Because Ingersoll did not limit his calculation of lost profits to the three-month period following Hudson's termination, Farmers contends the evidence Hudson presented on damages equates to no evidence of damages.
The termination notice provision set forth in the Agent Agreement provides as follows:
This Agreement terminates upon the death of the Agent and may be terminated by either the Agent or the Companies on three (3) months written notice.
If the provisions of this Agreement are breached by either the Agent or the Companies, the Agreement may be terminated by the other party on thirty (30) days written notice. This Agreement may be terminated immediately by mutual consent or by the Companies for the following reasons:
1. Embezzlement of money. . . .
2. Switching insurance from the Companies to another carrier.
3. Abandonment of the Agency.
4. Conviction of a felony.
5. Willful misrepresentation. . . .
Hudson received notice of his termination on April 26, 2004, stating his termination was effective on April 30, 2004. Hudson's termination letter notes that the Agent Agreement allows either party to terminate upon written notice and states that Farmers is "exercising this right." While the termination letter does not state that Hudson is being terminated for cause, it was undisputed at trial that Hudson was terminated for engaging in switching.
"Generally, the measure of damages for breach of contract is that which restores the injured party to the economic position he would have enjoyed if the contract had been performed." Mood v. Kronos Prods., Inc., 245 S.W.3d 8, 12 (Tex. App.-Dallas 2007, pet. denied). When the parties bargain for the flexibility of terminating a contract upon certain notice, they should not be denied the benefit of their bargain. Threadgill v. Farmers Ins. Exch, 912 S.W.2d 264, 267 (Tex. App.-Dallas 1995, no writ) ( citing Juliette Fowler Homes, Inc. v. Welch Assoc, Inc., 793 S.W.2d 660, 665 (Tex. 1990)). The Agent Agreement provides for termination, by either party, for any reason, upon three months' written notice. The agreement further provides that it may be terminated by either party for breach upon thirty days' written notice or immediately for causes listed in the agreement, including switching. Unless Hudson breached the agreement or committed one of the enumerated for-cause acts, Hudson was entitled to three months' written notice prior to termination. See id.
Hudson argues that because Farmers wrongfully attempted to terminate him for cause without notice, his damages are not limited by the three-month notice provision. We disagree. The jury believed Hudson's evidence that he did not engage in switching and found that Farmers breached the Agent Agreement by terminating him for cause. Because the agreement allowed either party to terminate for any reason with three months' notice, Hudson's breach of contract claim is in essence an inadequate notice claim. Three months' written notice is the actual benefit he received from the contract. Cf. Cushman Wakefield, Inc. v. Fletcher, 915 S.W.2d 538, 545 (Tex. App.-Dallas 1995, writ denied) (discussing proper measure of damages for breach of an employment contract containing a termination notice provision). Hudson did not have a contract term for the rest of his natural life, and Farmers was not obligated to employ Hudson until he retired. See id. Hudson was entitled to the benefit of his bargain, which was three months' written notice prior to termination. See id. at 545-46; see also Hussong v. Schwan's Sales Enters., Inc., 896 S.W.2d 320, 326 (Tex. App.-Houston [1st Dist] 1995, no writ); see generally Stolz v. Wells, 43 S.W.2d 163, 165 (Tex. Civ. App.-Beaumont 1931, no writ) (plaintiff was entitled to the benefit of his bargain — thirty days' notice prior to termination — which entitled him to recover for one month's pay following breach).
Hudson further argues that Farmers failed to comply with the Agent Agreement's termination review provisions, rendering Hudson's termination ineffective. Hudson cites Threadgill v. Farmers Insurance Exchange in support of his contention that termination cannot be considered final until the review process has been completed. Hudson's reliance on Threadgill is misplaced. Threadgill involved an Agent Agreement with notice of termination requirements and termination review provisions identical to those at issue here. See Threadgill, 912 S. W.2d at 267. The court concluded that the Agent Agreement was not ambiguous. Id. In reaching its conclusion, the court explained that the termination review provision was not inconsistent with the provision of the contract allowing for termination without cause on three months' written notice. Id. The Court did not conclude that failure to provide the review process would render the termination notice ineffective. See id.
Under Texas law, Hudson's damages for wrongful termination of his Agent Agreement are limited to the direct and consequential damages he suffered during the three months following his termination. See Cushman, 915 S.W.2d at 545-46; see also Hussong, 896 S.W.2d at 326; Stolz, 43 S.W.2d at 165; see generally Mood, 245 S.W.3d at 12-13. While Ingersoll testified to lost profits incurred by Hudson through the date of retirement and date of death, the record shows the income figures incorporated by Ingersoll in his calculations were "prorated for the period 5/1/2004 — 12/31/2004 using simple annualization dividing the total income by 12 [then] multiplying by 8." The record also shows that Ingersoll calculated lost profits using projected income for the eight months of 2004 at $55,850. Therefore, the lost profits for the three months following termination of the contract can be determined from the record to be $20,943.75, or $6,981.25 per month. Farmers called its damages expert, Andrew Galbraith, to dispute Ingersoll's opinions. Galbraith used Hudson's actual income instead of projected income as used by Ingersoll and testified that he calculated Hudson's lost profits for three months after the termination date to be $28,060. We sustain issues one and three in part. Because we find the evidence sufficient to support a lesser award of damages, we will address issue four.
Admissibility of Expert Testimony
In issue four, Farmers argues that Ingersoll's testimony regarding lost profits was unreliable and irrelevant, warranting a new trial. "A trial court has broad discretion in determining whether expert testimony is admissible. Its ruling will be reversed only if that discretion is abused." Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 578 (Tex. 2006) (citations omitted). The trial court is charged with ensuring that expert testimony is based upon a reliable foundation and is relevant to the issues in the case. Gammill v. Jack Williams Chevrolet, Inc., 972 S.W.2d 713, 728 (Tex. 1998). The trial court, therefore, is charged with ensuring that the expert's opinion comports with applicable professional standards. Id. at 725-26.
"To be relevant, an expert's opinion must be based on the facts; to be reliable, the opinion must be based on sound reasoning and methodology." State v. Cent. Expressway Sign Assocs., 302 S.W.3d 866, 870 (Tex. 2009). Lost profits need not be susceptible to exact calculation. Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 84 (Tex. 1992). However, "opinions or estimates of lost profits `must be based on objective facts, figures, or data from which the lost-profits amount may be ascertained.'" M A Tech., Inc. v. iValue Group, Inc., 295 S.W.3d 356, 366 (Tex. App.-El Paso 2009, pet. filed) (quoting Helena Chem. Co. v. Wilkins, 47 S.W.3d 486, 504 (Tex. 2001)). Generally, in performing an analysis of lost profits, one looks at past profits and adjusts these numbers based on the surrounding circumstances to estimate lost profits for a certain period of time. Id. (citing Tex. Instruments, Inc. v. Teletron Energy Mgmt., Inc., 877 S.W.2d 276, 279 (Tex. 1994)). "Revenue forecasting as in a lost income analysis must be based on objective facts or data and established to a reasonable certainty." Id. (citing Helena, 47 S.W.3d at 505).
Ingersoll explained that in calculating lost profits he used historical data to develop a growth rate, which was then used to project future lost profits. Ingersoll calculated a growth rate of 7.685 percent. Using this figure, Ingersoll provided a projection of lost profits suffered by Hudson post-termination through the date of trial, post-trial to his projected date of retirement, and post-trial through his projected date of death.
In calculating Hudson's lost profits, Ingersoll testified that he relied on Hudson's earnings, losses, and profits prior to the date of his termination. In the present case, Ingersoll looked at such data back to 1992. Ingersoll stated that he relied on the schedules attached to Hudson's tax returns, which set forth the income and expenses of the business. For some of the early years, 1992, 1993, and 1994, for which he did not have tax returns, Ingersoll relied on commission statements from Farmers to develop Hudson's gross revenue. Ingersoll then used this information to determine Hudson's growth rate, which he used to project future lost profits.
Farmers complains that Ingersoll used improper underlying data in formulating his opinions as to Hudson's lost profits. Farmers is critical of Ingersoll for using projected income figures when Hudson's actual income figures were available and for including income from Hudson's outside book of business in formulating the projected growth rate of Hudson's business. Although Galbraith, Farmers' expert witness, criticized Ingersoll regarding these discrepancies, he did not criticize the methodology used by Ingersoll in arriving at his opinions. Instead, Galbraith criticized the data Ingersoll used to arrive at his projected lost profit opinion. Farmers' objections to Ingersoll's testimony regarding lost profits go to the credibility or the weight to be given to this evidence by the jury. See generally Ford Motor Co. v. Ledesma, 242 S.W.3d 32, 40-41 (Tex. 2007) (concluding complaints about expert testimony went to the weight of such testimony when the testimony did not present too great an analytical gap between the data and the opinion, and the expert's testimony did not amount to anything more than a recitation of his credentials and a subjective opinion). The record establishes that Galbraith, implementing the same methodology as Ingersoll but applying different figures, calculated Hudson's estimated damages in close proximity to the damages estimate provided by Ingersoll for the three month post-termination period. Under these circumstances, we cannot conclude the trial court abused its discretion in allowing Ingersoll's testimony over Farmers' objections. We overrule issue four.
REMITTITUR
As discussed above, Ingersoll's expert report, admitted as an exhibit at trial, stated Hudson's calculated lost profits during the eight months following his termination, from May 1, 2004 to December 31, 2004, as $55,850. Dividing the amount of estimated lost profits $55,850 by eight months yields an average monthly lost profit of $6,981.25, or a total of $20,943.75 for three months. Farmers presented evidence of calculated lost profits by Hudson for that same period in the amount of $28,060. Because we find sufficient evidence in the record to support a lesser award of damages, we suggest that Hudson file a remittitur in the amount of $359,056.25, plus any applicable interest awarded, remitting that portion of the damages award which Hudson was not entitled to recover. See TEX. R. APP. P. 46.3; see also Springs Window Fashions Div., Inc. v. Blind Maker, Inc., 184 S.W.3d 840, 889-90 (Tex. App.-Austin 2006, pet. granted and remanded by agr.). If a remittitur is not timely filed, we must reverse the court's judgment in its entirety and remand the case for a new trial. See TEX. R. APP. P. 46.3.
PREJUDGMENT INTEREST AND ATTORNEY'S FEES
In issue five, Farmers argues that the award of prejudgment interest was improper because an award of prejudgment interest on future lost profits is barred as a matter of law. Farmers contends that because Hudson failed to submit a charge segregating past damages from future damages, no prejudgment interest is available to him. Farmers also argues in conjunction with issue five that because Hudson must prevail on both liability and damages to recovery attorney's fees, his claim for attorney's fees fails as a matter of law. In the event Hudson files a remittitur in accordance with our suggestion herein, Hudson's damages award will be limited to damages incurred in the past. Because we cannot be "reasonably certain that the jury was not significantly influenced by the erroneous amount of damages it considered," we must reverse the judgment as to attorney's fees and remand for a new trial on attorney's fees. See Young v. Qualls, 223 S.W.3d 312, 314-15 (Tex. 2007) (per curiam). If Hudson chooses not to accept the remittitur, we will reverse the judgment of the trial court in its entirety and remand for a new trial.
CONCLUSION
With the exception of attorney's fees, we affirm the judgment of the trial court, conditioned on the remittitur of $359,056.25 plus any applicable interest awarded. See TEX. R. APP. P. 46.3. If Hudson files a remittitur of $359,056.25 plus any applicable interest awarded with the clerk of the district court within fifteen days of this opinion and judgment and notifies this Court as such, we will reform the trial court's judgment and, as reformed, affirm the judgment except as to attorney's fees. The issue of attorney's fees must be remanded for a new trial. If the Orange County district clerk does not receive Hudson's remirtitur within fifteen days of this opinion and judgment, we will reverse the trial court's judgment in its entirety and remand the cause to the trial court for a new trial.
CONDITIONALLY AFFIRMED IN PART; REVERSED AND REMANDED IN PART; REMITTITUR SUGGESTED.