The Theft Liability Act allows the recovery of fees by a successful defendant; therefore, “a ‘defendant may be a prevailing party when a plaintiff nonsuits without prejudice if the trial court determines, on the defendant’s motion, that the nonsuit was taken to avoid an unfavorable ruling on the merits.” (citation and emphasis omitted).

Absent such a finding, however, when a defendant nonsuits a TTLA claim after the filing of summary-judgment motions on other claims, a trial court’s decision to not award fees is not reversible error.

In the “Department of Subtle Hints,” the Fifth Court noted that findings of fact were requested but not made, but no appellate argument had been made on that procedural point. Centurion American Custom Homes, Inc. v. Crossroads Opportunity Partners LLC, No. 05-21-00025-CV (Dec. 28, 2022) (mem. op.).

McKinney Aerospace was in the business of airplane repair.  In 2006, Boyington Capital Group came to McKinney for repairs on its airplane.  During negotiations, McKinney’s executive vice president, Randall Haler, told Boyington Capital, that McKinney was in “very fine legally financial shape.”  As it turns out, McKinney was on the verge of bankruptcy and failed to repair the plane.  It had also used Boyington’s initial payments to hold off creditors, so it could not return those funds to Boyington.  Boyington sued McKinney and Haler for, among other things, fraud, conversion, breach of fiduciary duty and breach of the Texas Theft Liability Act.  The jury found for Boyington.

On appeal, Haler argued that there was insufficient evidence to establish a claim under the TTLA against him. The Court of Appeals disagreed, upholding the jury’s finding and pointing out that “by misrepresenting the financial condition of McKinney Aerospace and spending money it received from Boyington on payments other than those related to repairing Boyington’s plane, Haler unlawfully appropriated Boyington’s property with the intent to deprive Boyington of its money.”  However, the Court of Appeals reversed the trial court’s grant of attorney’s fee to Boyington because Boyington did not segregate and exclude the fees for services that relate to its claims for which fees are not recoverable.

Haler v. Boyington Capital Group