In a case raising the issue of the status of conflicting trial court orders stating findings of fact and conclusions of law, the Waco Court of Appeals has held that the trial court intended to sign the findings and conclusions that supported the judgment.
Dudley Construction, Ltd. v. Cross Roads Concrete Services, Inc. (No. 10-24-00225-CV; October 2, 2025) arose from a dispute between a contractor and subcontractor over the construction of box culverts at an athletic complex in College Station. Dudley, the general contractor, discovered that its concrete subcontractor, Cross Roads, did not build the culverts properly. The City of College Station accepted an alternate repair technique for the defective box culverts but wanted Dudley to furnish an eight-year extended warranty, backed up by a bond, to correct future problems. Dudley demanded that Cross Roads provide the warranty and bond, which it did not. In any event, Cross Roads completed the alternative repairs. Concerned about its potential liability to the City, Dudley withheld payment to Cross Roads, expecting Cross Roads to secure a bond. Cross Roads filed suit soon thereafter, asserting claims for breach of contract and breach of fiduciary duty.
After a bench trial, the parties entered into a Rule 11 Agreement in February 2023, under which Dudley agreed to provide Cross Roads and the City a video of its inspection of the culverts, and Cross Roads agreed to obtain specified documents from the City. The agreement required Cross Roads to submit an eight-year maintenance agreement, secured by a bond, for the City’s approval. Additionally, the Agreement provided that in the event that the City didn’t go along with the agreement, the parties would report back to the court. Finally, the agreement stipulated that the court would consider any such report in rendering final judgment. Shortly thereafter, the trial court granted Cross Roads’s motion to sever and entered an order severing all of Dudley’s claims and causes of action asserted against it. On January 8, 2024 the trial court signed a judgment awarding Cross Roads $85,504.44 owed pursuant to the contract, attorney’s fees of $54,332.00, court costs, postjudgment interest, conditional attorney fees on appeal, and prejudgment interest of 1.5%. Three days later, Dudley filed a proposed final judgment, which the court signed on January 31, 2024. Again, the trial court found in Cross Road’s favor, this time setting a rate of 8.5% on postjudgment interest (as well as conditional attorney’s fees on appeal). On February 5 the trial court signed an order setting aside the January 8 judgment.
On March 15, the trial court signed its Findings of Fact and Conclusions of Law, finding that Dudley had breached the contract by failing to pay in the above amount, and that Dudley had violated §§ 162.001 and 162.003, Property Code. Ten days after that, Dudley filed a request for amended and additional findings of fact and conclusions of law, asserting that the March 15 findings did not support January 31 judgment. Dudley’s proposed amendments supporting a judgment that Dudley didn’t breach the contract, was not liable for breach of fiduciary duty, and Cross Roads failed to adequately plead prejudgment interest. The court agreed and signed an order setting aside the January 31 judgment. One more time, the court signed a judgment ordering Cross Roads recover $85,504.44, accruing prejudgment interest at 1.5% per month, attorney’s fees of $35,792, court costs, postjudgment interest, and conditional appellate attorney’s fees. It also signed the Amended Additional Findings of Fact and Conclusions of Law which had been submitted by Dudley on March 25, favoring Dudley and thus inconsistent with the judgment the court had just signed. Cross Roads filed a motion to vacate the the amended findings and conclusions because they did not support the relief granted in the judgment. Dudley moved for a new trial, to vacate the April 18 judgment, and to enter a new judgment reflecting the amended findings and conclusions. The trial court rendered no further orders, and Dudley appealed
In an opinion by Justice Smith, the court of appeals affirmed the judgment as modified. Dudley argued that the judgment must be reformed or reversed because of its incongruity with the Amended and Additional Findings of Fact and Conclusions of Law. Alternatively, it claimed that any failure to apply the findings of fact to the judgment amounted to error. Dudley primarily relied on City of Laredo v. R. Vela Exxon, Inc., 966 S.W.2d 673, 678 (Tex. App.—San Antonio 1998, pet. denied) for “the general rule that findings of fact and conclusions of law filed after a judgment are controlling if there is any conflict between them and the judgment, if there is any evidence in the record to support the findings.” Another case, however, Waters v. Yockey, 192 S.W.2d 769 (Tex. 1946), which held that “if the trial court intended the second set of findings to be substituted for the first set of findings, then the first set of findings must be disregarded, and judgment should be based on the second set of findings.” The court, consequently, looked to “the intention of the trial judge” in this case. This case differed from Waters in that “a judgment was rendered, a second judgment was rendered, the first judgment was set aside, findings and conclusions were signed, the second judgment was set aside, then a third judgment was rendered, and finally, a second set of findings and conclusions were signed.” What a mess.
To sort things out, the court examined each judgment and determined that in all cases, the trial court found that Dudley breached the contract. Consequently, the trial court simply made a mistake when it signed Dudley’s amended and additional findings of fact and conclusions of law and those findings should be disregarded. Since the April 18 judgment conformed to the March 15 findings, those control.
Dudley argued further that the trial court erred by awarding prejudgment interest to Cross Roads pursuant to the Prompt Payment Act because the Act doesn’t apply to government contracts. Dudley also asserted that Cross Roads failed to properly plead for statutory prejudgment interest in any event. Cross Roads’s original petition requested “interest as allowed by law.” The March 15 findings of fact and conclusions gave Cross Roads 1.5% per month in prejudgment interest pursuant to the statute (Chapter 28, Property Code). However, Cross Roads did not plead its entitlement to statutory prejudgment interest until its motion to Reconsider and Reform the January 31 judgment. As noted by the court’s opinion, § 28.002 defines “owner” as a “person or entity, other than a governmental entity, with an interest in real property that is improved, for whom the improvement is made, and who ordered the improvement to be made.” In this case, the City of College Station owned the property, rendering the Prompt Payment Act inapplicable. Cross Roads also failed to assert in its petition or briefing that the contract with Dudley contained a provision allowing recovery of prejudgment interest or that it was entitled to prejudgment interest in equity. It therefore couldn’t recover it, and the trial court abused its discretion by awarding it.
Dudley contended that it had the right to withhold funds as necessary to insulate itself from loss. But the court held that since Dudley didn’t put a clear and concise argument for that contention, supported by appropriate citations to authorities, in its brief, it waived the issue. Dudley then argued that the trial court abused its discretion by failing to incorporate the protections contemplated in the parties Rule 11 Agreement. Dudley’s proposed remedy (to withhold payment to secure against the necessary repairs or until such time as Cross Roads provided a warranty secured by a bond) was ignored by the trial court, which Dudley argued “constituted a fundamental change in the contractual positions of the parties.” Here the city didn’t do any of the things the parties wanted it to do but didn’t have to because the parties agreement didn’t bind it. In that event, the Rule 11 Agreement provided that the trial court was to “consider” the report filed by the parties’ attorneys. Nothing obligated the court to do anything either, so the trial court didn’t fail to enforce it. No abuse of discretion here. The trial court’s April 18 judgment was affirmed as modified to delete the award of prejudgment interest.
