Little by little, appellate practitioners are getting answers to the many questions emanating from the supersedeas statute and law that came about as part of tort reform in 2003.  The Texas Supreme Court‘s opinion in In re Nalle Plastics Family Limited Partnership holds that attorney’s fees are not compensatory damages that must be superseded. 

The law firm of Porter, Rogers, Dahlman & Gordon, P.C. sued Nalle Plastics for breach of contract to recover unpaid legal fees.  After a jury trial, the law firm recovered $132,661 in damages and the jury awarded $150,000 for attorney’s fees in connection with the breach of contract action.   Nalle Plastics superseded the $132,661 in damages, but not the attorney’s fees.  The trial court concluded that Nalle Plastics was required to also supersede the attorney fee award.  After the court of appeals held that attorney’s fees are compensatory damages that must be superseded, Nalle Plastics sought supreme court review by petition for mandamus. 

After review of the legislative history, the plain meaning of compensatory damages, and the legislative scheme, the supreme court held that attorney’s fees are not compensatory damages.  The court also held that attorney’s fees are not costs of court that must be superseded. 

There is one caveat in the court’s opinion.  The court refused to hold that attorney’s fees can never be considered compensatory.  As an example, the court noted that the breach of contract cause of action against Nalle Plastics was to recover unpaid attorney’s fees as damages.  The court held that these fees which were the damage element of the breach of contract claim and as such would constitute compensatory damages.

The court’s opinion may be found here.

Photo of Mike Northrup Mike Northrup

Mike Northrup is the chair of the appellate practice group at Cowles & Thompson, P.C. He is Board Certified in Civil Appellate Law by the Texas Board of Legal Specialization, and is a former Chair of the Appellate Law Section of the Dallas…

Mike Northrup is the chair of the appellate practice group at Cowles & Thompson, P.C. He is Board Certified in Civil Appellate Law by the Texas Board of Legal Specialization, and is a former Chair of the Appellate Law Section of the Dallas Bar Association. He is also a former briefing attorney for the Supreme Court of Texas.

Practice Areas

  • Civil Appeals
  • Labor and Employment Law
  • Insurance Law
  • Municipal Law

Professional Associations

  • Dallas Bar Association, Appellate Law Section
  • Defense Research Institute
  • College of the State Bar of Texas
  • State Bar of Texas, Appellate Section
  • Texas Aggie Bar Association

Education

  • JD, Texas Tech University School of Law (1988)
  • B.S., (Political Science), Texas A&M University (1985)

Bar Admissions

  • State Bar of Texas
  • United States Supreme Court
  • United States Court of Appeals for the Fifth Circuit
  • United States District Court, Northern, Southern, and Eastern Districts of Texas