Justice Jane Bland
In a somewhat unusual case we reported last October, the Texas Supreme Court has reversed an El Paso Court of Appeals decision reinstating the jury’s punitive damages award after confusion arose over whether the jury reached the required unanimity on the award.
Oscar Renda Contracting v. Theodis and Maria Bruce, et al. (No. 22-0889; May 3, 2024) arose from a lawsuit filed by several homeowners against a contractor for alleged property damage to their homes from vibrations caused by excavation work on a storm water project for the City of El Paso. Homeowners alleged negligence, gross negligence, fraud, trespass to real property, and other theories. The jury determined that contractor’s negligence proximately caused the damages and that the contractor intentionally and negligently created a public nuisance. It found different amounts of damages for each homeowner. The punitive damages instruction conditioned the jury’s answer on a unanimous finding of negligence, as required by law, and explained that, if so, the jurors must determine by a unanimous vote whether the contractor acted with gross negligence. The jury answered yes to the gross negligence question and assessed $75,000 in punitive damages to each homeowner, for a total amount of $875,000.
This is where things got confused. The verdict certificate provided with the jury charge required at least 10 jurors to agree on every charge and that those 10 jurors sign the certificate. The jurors checked the box on the certificate indicating that 10 jurors agreed on the verdict, and the same 10 signed. The jury returned the verdict, which the trial court read and, at the homeowners’ request, polled the jury. The 10 jurors who signed answered yes on the verdict, the other two no. The court discharged the jury without objection. But when homeowners moved for entry of judgment on the verdict, the contractor objected that the judgment could not award punitive damages because the verdict was not unanimous. Homeowners countered that the because the verdict included answers on negligence, gross negligence, and punitive damages, the jury must have been unanimous on those questions. The trial court entered judgment but disregarded punitive damages. Homeowners appealed.
Over a dissent by Justice Alley, the court of appeals reversed. Homeowners argued that the contractor waived its objections to then jury charge because it did not object to the punitive damages questions before the charge was read to the jury. Those instructions and the charge informed the jury that it had to be unanimous that the contractor was both negligent and grossly negligent in order to proceed to the assessment of punitive damages. The contract further did not challenge the jury charge in its post-verdict response to homeowners’ motion for entry of judgment, only the unanimity issue. The court of appeals found no waiver but determined that the trial court erred when it disregarded the jury’s award of punitive damages because: (1) the contractor failed to raise the unanimity issue with the court before it discharged the jury (when it could have been corrected), and (2) even so, the contractor did not conclusively establish that the jury awarded punitive damages without unanimity.
In an opinion by Justice Bland, SCOTX reversed and reinstated the trial court’s judgment. The issue before the court was which party “bears the burden to demonstrate a verdict’s unanimity.” Sec. 41.003, CPRC, requires a unanimous jury for an award of punitive damages, which the plaintiff must prove by clear and convincing evidence. The statute is thus clear that “the claimant, the party seeking exemplary damages, [] must secure proof of the elements of exenmplary damages ‘as provided by this section.’” This standard prohibits the burden from being shifted to the defendant, which is what the court of appeals’ decision “improperly” did. Defendant’s objection to Plaintiffs’ motion for judgment, which included the non-unanimous exemplary damages award, was sufficient to place the issue before ther trial court. Consequently, the court of appeals’ holding that Defendant was required to file a Texas Rule of Civil Procedure 301 motion to disregard the jury’s verdict was likewise erroneous. Plaintiffs, not the Defendant, had a burden to clarify the divided verdict. Additionally, the Court rejected Plaintiffs’ argument that Defendant’s failure to object to the omission of the statutorily required unanimity jury instruction waived Defendant’s objection to lack of unanimity, reiterating that Plaintiffs should have made certain that the charge was correct in the first place.
This is yet another SCOTX decision that corrects a pretty obvious error at the intermediate appellate level. As we’ve noted before, this seems to happen all too frequently in today’s environment.
