Isaacs v. Bishop

249 S.W.3d 100 (2008)

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Nature of the Case

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Facts

P contracted to sell the Hallsville Dragway to D. D purchased real and personal property. P provided purchase-money financing. P's attorney, R. G. Schleier, after negotiations between the parties, prepared the documents for the sale, including the promissory note. Six months after the sale, P's family--including father, mother, son, and daughter visited the track and were involved in a brawl with a handicapped track worker and his wife. D got involved in attempting to break it up. D called the police, who arrested P. When released P reportedly called D and attempted to get D to change his version of events to shift blame away from P. P made threats of physical violence and fiscal destruction. There was also evidence that Isaacs paid two fight witnesses to testify. P began looking for a way to foreclose on the hair-trigger default provision in the promissory note. There is evidence that Schleier changed the promissory note at P's direction to insert that provision, a provision the jury later found to have been fraudulently added. P began foreclosure proceedings. Evidence suggested that the track had been making a profit until P began his campaign to cause D's fiscal ruin and that bankruptcy ultimately resulted from that campaign. D sued P in tort for threatening and actively seeking his harm, wrongful foreclosure efforts, fraud in the sale of the track, and intentional infliction of emotional distress en route. D sued Schleier, alleging that Schleier had told D he need not get his own counsel and that Schleier had changed the documents after they'd been agreed to, but before they were signed. P sued D to accelerate the maturity of the note and foreclose on the track, seeking a judgment on the note balance. D sought to rescind the track purchase. The jury found that an attorney-client relationship existed between Schleier and D; damages were attributable thirty percent to D and seventy percent to Schleier; P committed fraud in the purchase and was seventy percent responsible, while D was thirty percent responsible; damages from the fraud amounted to $171,000.00; P intentionally inflicted emotional distress on D, entitling Bishop to $50,000.00; special damages, if the track were returned to P, would amount to $400,000.00 to D; D was due $171,000.00 for attorneys' fees for the bankruptcy and for expenses in defending against P's attempt to accelerate the note and foreclose on the track; attorneys' fees recoverable by D for prosecuting the fraud claim amounted to $200,000.00 for trial, $50,000.00 for appeal to this Court, and $35,000.00 for appeal to the Texas Supreme Court; court costs totaled $ 285,000.00. D filed an election to rescind the purchase, with collateral damages as found by the jury, and alternatively to recover for fraud. P filed a motion for judgment notwithstanding the jury's verdict. The judgment awarded D actual damages of $169,700.00 plus attorneys' fees and 'certain costs' of $250,000.00, without allocation to any specific cause of action. D's total award was $419,700.00, plus prejudgment interest in the amount of $22,130.74. It then held that P remained entitled to recover under the Replacement Note, for a total of $698,272.10. The trial court ordered a complete offset of the contractual amount due P against D's tort recovery leaving a balance owed to P of $256,441.36. The court required D to pay the balance in installments. Both parties appealed. In part, denying rescission to D was within the trial court's equitable discretion.