Bennett v. Grant

460 S.W.3d 220

Tom Bennett and James B. Bonham Corp., Appellants

v.Larry Wayne Grant, Appellee

NO. 03–11–00669–CV

Court of Appeals of Texas, Austin.

Filed: March 20, 2015

Don Cruse, Law Office of Don Cruse, Austin, TX, for appellee.

D. Todd Smith, Smith Law Group, P.C., Austin, TX, for appellant.

Before Chief Justice Rose, Justices Pemberton and Field

ON MOTION FOR REHEARING

OPINION

Scott K. Field, Justice

We withdraw the opinion dated August 13, 2014, and the supplemental opinion and judgment dated September 26, 2014, and substitute the following opinion and judgment in their place. We deny the Appellants' motion for rehearing.

This suit arises from a now infamous feud between neighboring cattle ranchers in San Saba, the details of which have been thoroughly relayed in prior opinions of this Court and the Texas Supreme Court. See Bennett v. Reynolds, 242 S.W.3d 866 (Tex.App.–Austin 2007), rev'd & remanded in part by 315 S.W.3d 867 (Tex.2010) (Bennett I ). The feud between cattle ranchers Thomas O. Bennett and Randy Reynolds has many turbulent twists and turns, see id. , but the gist of the dispute and subject of prior appeals involved allegations that thirteen head of cattle belonging to Reynolds had wandered onto Bennett's ranch, and that instead of returning them in a neighborly fashion, Bennett ordered his ranch hand—Larry Grant—to round up the cattle and sell them at auction. Grant testified that he raised concerns with Bennett that the cattle did not belong to him, but Bennett ignored his concerns.¹ Worried that he could be implicated in cattle theft, Grant purchased a disposable camera and took several photos of the cattle loaded on Bennett's trailer prior to the sale. Within two months of the sale, Grant left his employment with Bennett but kept the secret photos stashed away in a box in his home where they were seemingly forgotten and left undisturbed for almost a year. Reynolds, however, eventually learned of the secret photos after a chance encounter with Grant's brother-in-law and demanded that Grant turn the photos over to the authorities. What happens next is hotly disputed and the subject of litigation between Bennett and his former ranch hand, Grant, which gave rise to this appeal.

After Reynolds attempted to obtain the photos, Grant testified that he was distressed and began drinking beer and smoking marijuana to relieve tension. He then made a series of phone calls to Bennett and Bennett's friend and employee, Don “Ex” Rogers. Grant testified that the purpose of the calls was to inform Bennett of the pictures and give him an opportunity to “make it right” with Reynolds. Bennett and Rogers' version, however, depicts Grant as calling to try and sell the photographs to Bennett. Grant acknowledged he had some discussion with Rogers about selling the photos to Bennett but testified that they only “joked about it.” It was no joke, however, when Grant turned the photos over to law enforcement about a month after these conversations and triggered an extraordinary series of events. First, Bennett was indicted for cattle theft based in part on Grant's testimony and photos. Although ultimately acquitted of the criminal charges, Bennett and his cattle company, the James B. Bonham Corporation, were found liable for conversion in a civil suit brought by Reynolds resulting in a judgment of $5,327.11 in actual damages. The actual damages, however, paled in comparison to the combined exemplary damages of $1.25 million awarded amidst allegations that Bennett had willfully sold his neighbor's cattle to settle a score in a long-standing feud and then attempted to cover his actions by—among other allegations—threatening and bribing witnesses, tampering with the photographs Grant had taken to alter the images of the brands on the cattle to look like his own brand, and even attempting to register his neighbor's brand as his own with the district clerk of San Saba County. Such allegations and such a large exemplary damages award are extraordinary by themselves,² but it is only half of the story and less than half of the total liability adjudged against Bennett and the Bonham Corporation from these events.

The other half is the subject of this appeal—a $2.28 million judgment awarded to Grant for a successful malicious prosecution claim brought against Bennett and the Bonham Corporation. This claim arose from Bennett's admitted, yet ultimately unsuccessful, campaign to have Grant imprisoned after he turned the photos over to authorities. In this appeal, Bennett and the Bonham Corporation (collectively, Appellants) contest the judgment in Grant's malicious prosecution suit, contending: (1) legally insufficient evidence supported the malicious prosecution claim; (2) legally and factually insufficient evidence supported the $10,703 awarded in compensatory damages; (3) legally insufficient evidence supported the jury's findings allowing for the imposition of exemplary damages over the statutory cap; and (4) the total $2 million exemplary damages award ($1 million against Bennett and $1 million against the Bonham Corporation) violated due process. Individually, the Bonham Corporation raises several arguments challenging its liability in the suit, and Bennett challenges a $269,644.50 sanction. We conclude that the award of exemplary damages failed to comport with due process requirements and required remittitur, but otherwise uphold the trial court's judgment.

MALICIOUS PROSECUTION

A. Background Facts

On the evening of October 4, 2001, telephone records confirm that Grant called and spoke with Bennett for thirteen minutes, but the topic of conversation that evening is hotly disputed by the parties. As previously discussed, Grant testified that he called to inform Bennett about the pictures and to give him an opportunity to “make it right” with Reynolds. Bennett, however, testified that Grant called to try and sell the photos to him for $5,000. What is undisputed, however, is that Bennett waited nearly two years to report his allegations against Grant to the authorities. Indeed, Bennett testified that it was not until after his criminal trial that he decided to report the incident to authorities and acknowledged at trial that his sole “goal” in reporting the incident was to put “Grant in prison ... for what he's done to me.” In furtherance of his goal, Bennett testified he met with law enforcement authorities in four separate counties in an attempt to get Grant indicted for attempted blackmail. After authorities in San Saba County, Llano County, and Coleman County refused to prosecute Grant, Bennett met with the district attorney in Navarro County and requested he prosecute the case.

According to the district attorney's testimony, the following events then transpired. After his initial meeting with Bennett, the district attorney believed that if an attempted blackmail had occurred, it was a federal offense and referred the matter to the federal authorities. Unhappy with this outcome, Bennett again approached the district attorney but this time with a new theory—requesting that Grant be prosecuted for attempted theft. The district attorney informed Bennett he could not bring charges for misdemeanor attempted theft because it was barred by the two-year statute of limitations. Undeterred, Bennett then provided the district attorney with new information, alleging—for the first time—that Grant had attempted to extort money from him a second time within the limitations period. The district attorney testified that he was “skeptical” of this new evidence because it “appeared that there was maybe some tailoring of the facts going on to fit the statute.” Indeed, in his sworn testimony in this case, Bennett made no mention of a second attempted blackmail by Grant. Rather, he unequivocally testified that all the factual accusations against Grant occurred in a single evening on October 4, 2011. The district attorney further testified that, based on his conversations with Bennett about the case, he formed the impression that Bennett's motive for prosecuting Grant was to gain an advantage in civil litigation arising from the case. Being “suspicious” of Bennett's new evidence, the district attorney decided to “dig in his heels” and refused to prosecute.

Still undeterred, Bennett met with an attorney who testified that he had represented the Bonham Corporation for over twenty years and that Bennett directed him to research and draft a legal brief advocating that Grant's alleged actions constituted a criminal offense that should be prosecuted. The district attorney testified that it was this brief or another meeting with Bennett that finally was the “catalyst” that prompted him to bring the case to the grand jury. He further testified that it was “rare” for him to bring misdemeanor cases to the grand jury because he himself had the authority to bring misdemeanor charges without grand jury involvement. But, in this case, he finally yielded to Bennett's demands because he did not want to appear “draconian” in his refusal to bring charges. The district attorney may have been finally persuaded to present the case, but the grand jury was not as persuaded and refused to indict Grant.

Frustrated that the grand jury had not indicted Grant, Bennett testified he again met with the same attorney who this time advised him to get a special prosecutor appointed in Navarro County to bring the case before the grand jury a second time. After the attorney explained to him the procedure for appointing a special prosecutor, Bennett testified he had the attorney draft a petition alleging the district attorney had a conflict of interest and accusing him of taking no action in the case.³ The petition further sought the appointment of Robert Dunn—a local attorney and neighbor of Bennett's—as a special prosecutor for the case. Bennett, who resided and ran a cattle ranch in Navarro County, testified that he then led the effort to circulate and obtain over 250 signatures from ...