ATTORNEY’S FEES PRESCRIBED BY CONTRACT? STILL NO NEED TO SUPERSEDE

Highland Capital Management, L.P. v. Daugherty
Dallas Court of Appeals, No. 05-14-01215-CV (October 22, 2014)
Chief Justice Wright and Justices Lang-Miers and Brown (Opinion)
Highland obtained a judgment against Daugherty after a trial over his employment agreement with Highland. That judgment included a $2.8 million attorney’s fees award. Daugherty posted a supersedeas bond to suspend enforcement of the judgment pending appeal. Attorney’s fees incurred in the prosecution or defense of a claim ordinarily are not “compensatory damages” that must be superseded under TEX. CIV. PRAC. & REM CODE § 52.006(a) and In re Nalle Plastic Family Ltd. P’ship, 406 S.W.3d 168, 175 (Tex. 2013); so, Daugherty did not include them in his bond. Highland moved to increase the bond, arguing that because the employment agreement at issue expressly provided for recovery of attorney’s fees, they should be treated as compensatory damages and must be superseded in order to suspend enforcement of the judgment. The Dallas Court of Appeals disagreed. Prescribed in the contract or not, fees for pursuing or defending a claim on the contract at issue are not an element of compensatory damages and need not be included in the supersedeas amount. Motion denied.

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