Fees aren’t damages.

March 6, 2019

Morben Realty successfully sued Texas Capital Holdings; the trial court denied recover of attorneys’ fees and the Fifth Court reversed, noting: “Texas law has ‘long distinguished attorneys’ fees from damages.’ So does this contract.” Specifically, the section on remedies “generally provides the seller with a liquidated damages remedy if the purchaser defaults” –

Seller shall, as Seller’s sole remedy, be entitled to terminate this Contract and receive and retains the Earnest Money deposit as liquidated damages; it being specifically agreed between Seller and Purchaser that Seller’s actual damages in the event of Purchaser’s default would be impossible to ascertain and the Earnest Money Deposit is a reasonable estimate of the same . . . .

But another section addressed the recovery of fees by the prevailing party –

In the event either party to this Contract commences legal action of any kind to enforce the terms and conditions of this Contract, the prevailing party in such  litigation shall be entitled to collect from the other party all reasonable costs, expenses, and attorney’s fees incurred in connection with such action.

Morben Realty v. Texas Capital Holdings, No. 05-17-01105-CV (Feb. 27, 2019) (mem. op.)