Binnacle Texas City Twenty Two, LLC v. Principal Services, Ltd.

Affirmed and Memorandum Opinion filed November 19, 2024.

In The

Fourteenth Court of Appeals

NO. 14-23-00161-CV

BINNACLE TEXAS CITY TWENTY TWO, LLC, Appellant
V.
PRINCIPAL SERVICES, LTD., Appellee

On Appeal from the 157th District Court
Harris County, Texas
Trial Court Cause No. 2021-76590

MEMORANDUM OPINION

A defendant appeals the trial court’s judgment in a breach-of-contract case
challenging only the trial court’s attorney’s fees awards. We conclude that
appellant’s challenges to the attorney’s fees awards based on alleged deficiencies
regarding work by legal assistants are moot because the appellee has released in
part the trial court’s judgment in the amount of the attorney’s fees requested based
on the legal assistants’ work. We conclude that the plaintiff submitted evidence of
the reasonableness of its trial attorney’s hourly rate, and therefore the evidence
regarding attorney’s fees was not insufficient due to a lack of evidence in this
regard. We affirm the trial court’s judgment while recognizing that the plaintiff has
partially released it.

I. FACTUAL AND PROCEDURAL BACKGROUND

Appellee/plaintiff Principal Services, Ltd. filed suit against
appellant/defendant Binnacle Texas City Twenty Two, LLC seeking to recover
based on a claim for breach of contract. Binnacle answered. Principal filed a
motion for summary judgment on its claim, including a declaration of James
Egbert, its trial attorney, regarding attorney’s fees, as well as attorney’s fees
invoices and a work-in-progress report describing work on this case by Egbert and
by Kathryn Ruiz, Donna Collins, and Heather Evans (collectively, the “Legal
Assistants”). Binnacle did not file a response. The trial court signed a final
summary judgment granting all the relief Principal requested: (1) $97,317.96 in
actual damages, (2) $5,631.11 in prejudgment interest, (3) $14,553.85 in
reasonable and necessary attorney’s fees for work in the trial court, (4) conditional
awards of appellate attorney’s fees, (5) $7,846.66 in sanctions the trial court had
previously assessed against Binnacle, (6) court costs, and postjudgment interest.

Binnacle timely filed a motion for new trial asserting various arguments in
support of the proposition that Principal’s evidence was legally insufficient to
support any of the awards of attorney’s fees. The trial court granted the motion as
to the conditional awards of appellate attorney’s fees and denied the motion as to
the attorney’s fees award for work in the trial court.

Principal filed a second summary-judgment motion submitting a declaration
of attorney Clinton Twaddell and seeking conditional awards of appellate
attorney’s fees that were different from the awards rendered in the first judgment.

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Binnacle filed no response. The trial court signed a second final judgment in which
it made conditional awards of appellate attorney’s fees in the amounts requested in
Principal’s second summary-judgment motion; the remainder of the judgment was
the same as the first judgment (“Judgment”).

Binnacle timely filed a second motion for new trial asserting various
arguments in support of the proposition that the evidence was legally insufficient
to support the award of attorney’s fees for work in the trial court. The trial court
denied this motion, and Binnacle timely perfected this appeal.

II. ISSUES AND ANALYSIS

In its first issue Binnacle asserts that the trial court erred in awarding trial-
stage attorney’s fees to Principal because there was no evidence of the
reasonableness of the hourly rate for Egbert and for the Legal Assistants under the
principles in Rohrmoos Venture v. UTSW DVA Healthcare, LLP, 578 S.W.3d 469
(Tex. 2019). In its second issue Binnacle contends that the trial court erred in
awarding fees based on the work of the Legal Assistants because there was legally
insufficient evidence showing their qualifications to perform substantive legal
work or showing that they performed substantive legal work under the direction
and supervision of an attorney, as set forth in El Apple I, Ltd. v. Olivas, 370
S.W.3d 757 (Tex. 2012).

A. Are Binnacle’s complaints as to fee awards based on the Legal
Assistants’ work moot?
Under the first issue Binnacle complains that there is no evidence showing
(1) the reasonableness of the hourly rate of any of the Legal Assistants; (2) the
reasonableness of the time spent by any of the Legal Assistants, or (3) the identity
of any of the Legal Assistants, their education, training, or experience, including

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whether they are attorneys, law clerks, or legal assistants. Under the second issue
Binnacle argues that Principal did not submit any evidence regarding the
qualifications of any of the Legal Assistants or that any of them performed
substantive legal work under the direction and supervision of an attorney.

Shortly before Principal filed its appellate brief in this case, it filed in the
trial court a partial release of the Judgment in which Principal unconditionally
releases each part of the attorney’s fees awards that was based on the work of one
of the Legal Assistants (“Partial Release”). In the Partial Release Principal
unconditionally releases (1) $1,928.50 from the Judgment’s award of reasonable
and necessary attorney’s fees for work in the trial court, (2) $1,120 from the
conditional award for representation in the court of appeals, (3) $320 from the
conditional award for representation at the petition for review stage in the Supreme
Court of Texas, (4) $320 from the conditional award for representation at the
merits briefing stage in the Supreme Court of Texas; and (5) $160 from the
conditional award for filing or responding to a motion for rehearing in the Supreme
Court of Texas. In the Partial Release Principal states that it does not release the
remainder of the Judgment.

If a judgment creditor releases part of a judgment during the pendency of a
judgment debtor’s appeal from the judgment, any appellate challenges by the
judgment debtor to the part of the judgment that is released become moot, and this
court should affirm that part of the judgment, recognizing that it has been released.
See Lee v. Dykes, 312 S.W.3d 191, 193–94 (Tex. App.—Houston [14th Dist.]
2010, no pet.).

Binnacle contends that Principal is seeking a remittitur of the fees awarded
based on the work of the Legal Assistants. Under certain circumstances a court of
appeals may suggest a remittitur of the damages awarded in the trial court’s

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judgment. See Tex. R. App. 46.3; Qin v. Yang, No. 14-22-00197-CV, 2023 WL
4783550, at *12 (Tex. App.—Houston [14th Dist.] July 27, 2023, pet. denied)
(mem. op.). If the judgment creditor timely accepts and files the remittitur, the
court of appeals will modify the trial court’s judgment and affirm it as modified.
See Tex. R. App. 46.3; Qin v. Yang, 2023 WL 4783550, at *12. If the judgment
creditor refuses the remittitur, the court of appeals will reverse the judgment. See
Tex. R. App. 46.3; Qin v. Yang, 2023 WL 4783550, at *12. In today’s case this
court has not suggested a remittitur, and Principal has not accepted a remittitur.
Instead Principal has unconditionally released part of the Judgment. This release
operates as a relinquishment by Principal of all its rights in and to the part of the
Judgment that Principal has released. See Rapp v. Mandell & Wright, P.C., 123
S.W.3d 431, 435–36 (Tex. App.—Houston [14th Dist.] 2003, pet. denied). Neither
a release of part of the Judgment nor a conclusion by this court that this release
moots some of the complaints in this appeal would result in a modification of the
Judgment. See Lee, 312 S.W.3d at 193–94. Thus, Principal is not seeking a
remittitur, and this court is not suggesting a remittitur.

Binnacle asserts that by releasing part of the Judgment and asserting that
some complaints are moot Principal seeks to effectively interfere with the
exclusive jurisdiction of this court over the Judgment. But the case cited by
Binnacle in support of this proposition addresses whether a trial court’s anti-suit
injunction during the pendency of an appeal from its judgment interfered with the
court of appeals’s determination of an issue, undermined the right of the appellant
to prosecute its appeal, or modified the trial court’s final judgment. See Bridas
Corp. v. Unocal Corp., 16 S.W.3d 887, 889–90 (Tex. App.—Houston [14th Dist.]
2000, pet. dism’d w.o.j.). That case is not on point because Principal’s release was
not an action by the trial court. Binnacle cites no case holding that an appellee may

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not take an action that moots some of the appellate issues, and precedent from this
court allows an appellee to release part of the trial court’s judgment and moot
appellant’s challenges to that part. See Lee, 312 S.W.3d at 193–94.

Principal has unconditionally released the parts of the attorney’s fees awards
in the Judgment that were based on the work of the Legal Assistants. Therefore we
conclude that Binnacle’s second issue and its complaints under the first issue
regarding the Legal Assistants are now moot. See Lee, 312 S.W.3d at 193–94.

B. Was there any evidence of the reasonableness of Egbert’s hourly rate?
Principal sought to prove its reasonable and necessary fees using the lodestar
method, under which the fact finder’s starting point for calculating an attorney’s
fee award is determining the reasonable hours worked multiplied by a reasonable
hourly rate. See Rohrmoos Venture v. UTSW DVA Healthcare, LLP, 578 S.W.3d
469, 498 (Tex. 2019). The fee claimant bears the burden of providing sufficient
evidence on both counts. See id. Sufficient evidence includes, among other things,
evidence of the reasonable hourly rate for each person performing the services. See
id. Under the first issue Binnacle argues that the evidence regarding attorney’s fees
for work in the trial court was insufficient because there was no evidence of the
reasonableness of attorney Egbert’s hourly rate.

Principal submitted billing invoices and a report of work not-yet-billed,
describing work performed by Egbert for the proceedings in the trial court,
including the amount of hours work. At first the records show that Egbert’s hourly
rate was $275 per hour, but starting with Egbert’s work in December 2021,
Egbert’s hourly rate increased to $300 per hour. In his declaration Egbert stated:

• Egbert was counsel for Principal at the time of his declaration.
• Egbert is an attorney at law licensed to practice in the State of Texas since
2014.

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• Egbert is “familiar with the usual, reasonable and customary fees for
representation in civil litigation at the trial and appellate level for South
Texas and in Texas in general.”
• In Egbert’s opinion “a reasonable and customary fee for representation in a
case such as this on an hourly basis would be between $200 and $500 per
hour based upon the factors approved by the Texas Supreme Court in the
case Arthur Anderson & Co. v. Perry Equipment Co[r]p., 945 S.W.2d 812
(Tex[.] 1997).”
• Egbert stated that these factors include:
“a. The novelty and difficulty of the questions involved and the skill []
requisite to perform the legal services properly;
b. The likelihood that the acceptance of the particular employment would
preclude other employment by the firm;
c. The fee customarily charged in the locality of similar legal services;
d. The dollar amount involved and the results obtained; and
e. A review of the pleadings to date.”
• Egbert’s firm has worked 51.40 hours and incurred $14,553.85 in attorney’s
fees and expenses from the date the firm was retained by Principal to pursue
this claim through June 24, 2022, as outlined in an attached exhibit, which is
a true and correct copy of the billing records for Egbert’s firm in this case.
• The work performed includes communicating with Principal, reviewing
relevant documents, preparing a demand letter, drafting the Original
Petition, filing the petition, arranging for service, drafting a motion for
substituted service, and time spent preparing the first summary-judgment
motion.
• All work corresponding to these fees was necessary to pursue recovery in
this matter.
• A reasonable fee for the necessary work in pursuing this action through the
hearing on the first summary-judgment motion would be $14,553.85.

Egbert testified that an hourly rate of between $200 and $500 would be
reasonable for representation in today’s case based upon the Arthur Andersen
factors. See Arthur Anderson & Co. v. Perry Equipment Corp., 945 S.W.2d 812,
818 (Tex. 1997). Principal submitted evidence that Egbert’s hourly rate started at

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$275 per hour and then increased to $300 per hour, which is within this range. We
conclude that Principal presented evidence of the reasonableness of Egbert’s
hourly rate. See Townley v. Lanier, No. 14-19-00447-CV, 2021 WL 2325082, at *7
(Tex. App.—Houston [14th Dist.] June 8, 2021, pet. denied) (mem. op.). Binnacle
asserts that there is no evidence of the reasonableness of Egbert’s hourly rate
because Egbert testified as to a range of reasonable hourly rates rather than
specifically stating that $275 per hour and $300 per hour are both reasonable rates.
Egbert does not cite any case holding that a range of reasonable rates constitutes no
evidence of a reasonable rate that falls within the range.

In Townley v. Lanier, the plaintiff submitted attorney’s fees invoices
describing the work done, hours worked, and hourly rate of the plaintiff’s attorney.
See id. The attorney’s hourly rate was $250 per hour. See id. The attorney testified,
“‘I’ve been an attorney for 33 years. The fees that I’ve charged are custom [sic]
and regular in the industry for cases such as this. They were reasonable and
necessary in the prosecution of this claim.’” Id. On cross-examination, the attorney
testified that he had seen billing rates “as low as 150 or 175 . . . [or] as high as 300
or 350.” Id. In Townley this court concluded that there was evidence that the
lawyer’s hourly rate was reasonable and that the evidence was legally sufficient to
support the reasonable attorney’s fees awarded by the trial court. See id.
(concluding that the plaintiff’s evidence “sufficiently addressed the Rohrmoos
Venture factors” and that the evidence was legally sufficient to support the
reasonable attorney’s fees the trial court awarded). Binnacle argues that Townley is
not on point because the attorney in Townley testified that his hourly rate was
reasonable but Egbert did not do so. But the attorney in Townley stated that the
fees he charged were reasonable and necessary; he never said that his hourly rate
was reasonable. See id. Egbert made a similar statement in his declaration:

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“Therefore, a reasonable fee for the necessary work in pursuing this action through
the hearing on the [first summary-judgment motion] would be $14,553.85.”

We conclude that there was evidence of the reasonableness of Egbert’s
hourly rate and that the evidence regarding attorney’s fees for work in the trial
court was not insufficient due to a lack of evidence on this point. See id. To the
extent the first issue is not based on challenges regarding the work of the Legal
Assistants, we overrule the first issue.

III. CONCLUSION

Principal has unconditionally released the parts of the attorney’s fees awards
in the Judgment that were based on the work of the Legal Assistants. Therefore,
Binnacle’s second issue and its complaints under the first issue regarding the Legal
Assistants are now moot. Principal submitted evidence of the reasonableness of
Egbert’s hourly rate, and therefore the evidence regarding attorney’s fees for work
in the trial court was not insufficient due to a lack of evidence in this regard.
Having addressed all of Binnacle’s appellate complaints, we affirm the trial court’s
judgment, recognizing that Principal has released the following amounts: (1)
$1,928.50 has been released from the award of $14,553.85; (2) $1,120 has been
released from the conditional award of $20,370; (3) $320 has been released from
the conditional award of $9,000; (4) $320 has been released from the conditional
award of $7,320; and (5) $160 has been released from the conditional award of
$3,820.

/s/ Randy Wilson
Justice
Panel consists of Chief Justice Christopher and Justices Zimmerer and Wilson.

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