In Home Comfortable Supplies, Inc. v. Cooper, the defendant induced others to start a new limited partnership with his corporation. No. 14-16-00906-CV, 2018 Tex. App. LEXIS 1381 (Tex. App.—Houston [14th Dist.] February 22, 2018, no pet. history). Among other things, he then seized the new business’s tangible assets and gave the use of the assets to a new company formed by his wife. The plaintiffs sued for fraudulent inducement, breach of fiduciary duty, conversion, and breach of contract, and trial court awarded actual damages, punitive damages, and attorney’s fees. On appeal, the defendant argued that the only actual damages proven and awarded were for breach of contract, which did not support an award of punitive damages. The defendant did not ask the trial court to identify the actual damages awarded or link them to a specific cause of action.
The court of appeals first described an appealing party’s duty to request findings:
Unchallenged findings of fact bind the appellate court unless the contrary is established as a matter of law or no evidence supports the finding. McGalliard v. Kuhlmann, 722 S.W.2d 694, 696 (Tex. 1986). If the factual findings include at least one element of a given ground of recovery or defense, any omitted unrequested elements that are supported by the evidence are supplied by a presumption in support of the judgment. Tex. R. Civ. P. 299. Although a party can avoid a presumed finding by requesting additional or amended findings that include the omitted element, see Tex. R. Civ. P. 298, no such request was made here.
The court then held that there was evidence to support a finding of breach of fiduciary duty, which would support the award of punitive damages:
Punitive damages also are available for breach of fiduciary duty. See Manges v. Guerra, 673 S.W.2d 180, 184 (Tex. 1984) (op. on reh’g). Partners share “the obligation of loyalty to the joint concern and of the utmost good faith, fairness, and honesty in their dealings with each other with respect to matters pertaining to the enterprise.” Bohatch v. Butler & Binion, 977 S.W.2d 543, 545 (Tex. 1998). Zhao and Home Comfortable Supplies do not challenge the trial court’s findings that clear and convincing evidence establishes that Zhao, individually and as president of Home Comfortable Supplies, wrongfully took possession and control of Paragon’s business assets and transferred them with the intention of destroying Paragon’s business, harming Paragon’s partners, and enriching himself. Thus, damages may have been awarded for breach of fiduciary duty. These damages may have included the value of Cooper’s and Bonner’s interest in Paragon’s assets, if the assets had been liquidated as required, as well as the money Cooper invested to obtain a larger membership interest in the General Partner.
Id. Thus, the court of appeals affirmed the trial court’s award of punitive damages.
Interesting Note: Many attorneys and clients that lose in a trial court via a bench trial are reluctant to want the trial court to explain its ruling and awards. They may feel that the findings will make them look worse than the actual judgment. That may be true, but any good appellate attorney will recommend that a losing party request findings of fact and conclusions of law. A trial court will usually not rule for the wining party on every element of every claim, and may focus the findings on just one claim or a few claims. Moreover, there is nothing to lose because if a losing party does not request findings, all findings will be presumed found to support the judgment. Worford v. Stamper, 801 S.W.2d 108, 109 (Tex. 1990). So, generally, express findings cannot be worse than the presumption, and there is no harm in obtaining adverse express findings whereas there can be more harm in having adverse presumed findings.
Parties should be aware that in Texas there are strict requirements to preserve a request for findings. The party must file a request for findings of fact and conclusions of law within twenty days of the signing of the judgment. Tex. R. Civ. P. 296. The court is supposed to file its findings of fact and conclusions of law within twenty days of the request. Tex. R. Civ. P. 297. If the court fails to do so, then the requesting party must file a notice of past due findings of fact and conclusions of law within thirty days of the filing of the original request. See id. Thereafter, the court should file findings of fact and conclusions of law within forty days from the filing of the original request. See id. If a party fails to file a notice of past due findings of fact and conclusions of law, he has waived any error in the court failing to file such, and all facts will be presumed in favor of the judgment. Curtis v. Commission for Lawyer Discipline, 20 S.W.3d 227, 232 (Tex. App.—Houston [14th Dist.] 2000, no pet.). Once the court files findings, a party can file a request for additional findings of fact within ten days after the original findings are filed. Tex. R. Civ. P. 298. This request for additional findings must be specific and must contain proposed findings, otherwise any error in refusing the request is waived. Alvarez v. Espinoza, 844 S.W.2d 238, 241‑42 (Tex. App.—San Antonio 1992, writ dism’d).
Just as a losing party should want express findings, a winning party should generally not want the court to issue express findings because of the presumption. Because it is difficult to preserve error on a trial court’s failure to issue findings, a winning party should be reluctant to prepare proposed findings for a trial court just because a judgment is entered or just because the losing party initially requests findings.
