Texas

Warning: The following opinion is provided for purposes of discussion only. We have not Shepardized™ this opinion, and do not know the subsequent disposition of this case nor whether the effect of the opinion has been overruled or superceded by other law.

Skelley v. Hayden,
2000.TX.0053440 (Tex.App. Dist.5 09/05/2000)

In The Court of Appeals Fifth District of Texas at Dallas

No. 05-99-00802-CV

2000.TX.0053440

September 5, 2000

JANET GIBBS SKELLEY, INCO ENERGY, L.C., INJOY, LTD., HH EXPLORATION, INC., JANET G. SKELLEY SEPARATE PROPERTY TRUST, JANET GIBBS SKELLEY MARITAL TRUST, JANET GIBBS SKELLEY IRREVOCABLE TRUST, JANET GIBBS SKELLEY FAMILY TRUST, JANET GIBBS SKELLEY SEPARATE PROPERTY LIVING TRUST, JANET GIBBS SKELLEY SEPARATE PROPERTY TRUST, JGS SEPARATE PROPERTY TRUST, SKELLEY SEPARATE PROPERTY TRUST, JEFFREY J. SKELLEY II MEMORIAL TRUST, JEFFREY JAMES SKELLEY II TRUST, EDWARD D. HAYDEN, SR., IRREVOCABLE TRUST, EDWARD D. HAYDEN, SR. TRUST, EDWARD D. HAYDEN, SR., MARITAL TRUST, AND HH FAMILY TRUST, APPELLANTS

v.

EDWARD D. HAYDEN, JR., WILLIAM W. HAYDEN, ANDREW T. HAYDEN, AND ARLINE HAYDEN, APPELLEES

On Appeal from the Probate Court No. 2 Dallas County, Texas , Trial Court Cause No. 96-4952-P2A

Before Justices James and Moseley*fn1

The opinion of the court was delivered by: Justice James

AFFIRMED IN PART, REVERSED AND RENDERED IN PART, and REVERSED AND REMANDED IN PART; Opinion filed September 5, 2000

OPINION ON MOTION FOR REHEARING

We overrule the Motion for Rehearing of appellees Edward D. Hayden, Jr., William W. Hayden, Andrew T. Hayden, and Arline Hayden. We further deny the "Motion to Correct and Modify Judgment and Opinion, and For Clarification or Instructions," and alternative motion to intervene, of Edward V. Smith, III, Court Appointed Administrator with Will Annexed of the Estate of Edward Hayden, Sr. On our own motion, however, we vacate our July 31, 2000 judgment and withdraw our prior opinion in order to correct certain factual errors noted by the Administrator with Will Annexed. The following is now the opinion of the Court.

All of the parties in this complex probate case, except the estate administrator, appeal the probate court's judgment. Appellants assert ten points of error. In three of their points of error, appellants contend the trial court erred in awarding damages to decedent's estate because (1) neither the decedent's heirs nor his estate have standing to challenge the validity of the decedent's inter vivos transfers made in fraud of his creditors; (2) the heirs' challenges to the fraudulent transactions were barred by res judicata; and (3) the heirs and the estate failed to obtain a finding that the damages were proximately caused by the fraudulent transfers. Appellants also contend the trial court erred in awarding damages from the estate to the heirs' trusts because the award was contrary to the jury's findings of accord and satisfaction and estoppel. Next, appellants argue the trial court erred in awarding damages to the heirs' trusts and to the decedent's eldest son because (1) their claims were barred by the statute of limitations; (2) they failed to obtain a finding that their damages were proximately caused by appellants' wrongful conduct; and (3) the evidence is insufficient to support the damage awards. Finally, appellants contend the probate court erred in (1) awarding attorney's fees to the heirs; (2) imposing a constructive trust; and (3) entering a permanent injunction against appellants.

Appellees present five cross-complaints. They first assert the evidence is legally and factually insufficient to support the jury's findings that (1) the deed to the family house was delivered to a trust which benefitted decedent's spouse; (2) decedent's spouse did not abandon her interest in the family home; and (3) the decedent's estate owes the spouse money under a promissory note. Also, appellees contend the probate court erred in (1) failing to find decedent's spouse waived her homestead interests in the family house and (2) awarding attorney's fees to decedent's spouse.

We affirm in part and reverse in part.

Factual and Procedural History

Edward Hayden, Sr. (Ed, Sr.) died in November, 1996, leaving his third wife, Janet Gibbs Skelley Hayden (Skelley), and his three sons from a prior marriage, Edward, Jr., William, and Andrew (collectively the Sons). Ed, Sr.'s will provided that all of his assets at death were to pour over into an irrevocable trust. From the irrevocable trust, $25,000 was to be paid to each of Ed, Sr.'s two ex-wives. The remaining property was to be distributed into four additional trusts created by the will; the Janet Gibbs Skelley Marital Trust was to receive 25% of the remaining property, and three trusts created for the benefit of the Edward, Jr. (Ed, Jr.), William, and Andrew were to receive equal portions of the remaining 75%. Eric Melgren was named executor of Ed, Sr.'s estate (the Estate) and trustee of the irrevocable trust. Melgren later resigned, and Edward Smith, III, succeeded Melgren as Administrator with Will Annexed.

Soon after Ed, Sr.'s death, numerous disputes arose concerning the assets in the Estate. Because of the controversy, the administrator filed a declaratory judgment action on behalf of the Estate in which he named the Sons and Skelley as defendants and requested the probate court to determine which assets remained in the Estate at Ed, Sr.'s death. The Sons asserted cross-complaints against Skelley and added numerous Third Party Defendants.*fn2

The Sons' mother, Arline Hayden, intervened as the trustee of the three testamentary trusts established in Ed, Sr.'s will for the benefit of the Sons.

The first dispute asserted by the Sons regarded whether certain property remained Ed, Sr.'s separate property at his death. Before they married, Ed, Sr. and Skelley executed a prenuptial agreement designating most of Ed, Sr.'s assets as separate property. However, in an attempt to avoid paying a $700,000 judgment in favor of the U.S. government, Ed, Sr. transferred a large portion of his assets to Skelley, three inter vivos trusts benefitting the Sons (the Sons' Trusts),*fn3 and the Third Party Defendants. Ed, Sr. then filed for bankruptcy claiming he did not have sufficient assets to pay the judgment. The government filed an adversary proceeding alleging the transfers were fraudulent and requested the bankruptcy court to void the transactions. Eventually, Ed, Sr. settled the suits. To pay the settlement, Ed, Sr. borrowed $463,000 from Skelley and executed a promissory note to evidence the debt. At the time of his death, Ed, Sr.'s assets had not been returned to his estate, and only $10,000 had been paid on the note. The Sons maintained at trial that the property transferred to defraud the government remained Ed, Sr.'s separate property and that the note to Skelley should be voided as a fraudulent obligation.

Also in dispute at trial was the amount of money owed by the Estate to the Sons' Trusts and to Ed, Jr., individually. In the early eighties, each of the Sons' Trusts and Ed, Jr. owned 10% of INCO Exploration which was one of the companies managed by Ed, Sr. INCO Exploration's assets consisted primarily of investments in the Bryan Woodbine Oil Field. In 1984, INCO Exploration was dissolved and its assets were distributed to its shareholders. However, after the dissolution, several checks from the Bryan Woodbine Field were deposited into Ed, Sr.'s personal accounts despite being made out the Sons' Trusts and Ed, Jr. In a letter sent on August 1, 1988 to Thomas Hayden, the trustee of the Sons' Trusts, Ed, Sr. recognized the debt to the Sons' Trusts and offered to deed his half interest in the Hayden Ranch to the Sons' Trusts in satisfaction. The letter was signed by Thomas Hayden and the Sons, and Ed, Sr. deeded his interest in the ranch to the Sons' Trusts. The agreement did not reference any debt owed to Ed, Jr. The Sons argued to the probate court that the Estate still owed them for the Bryan Woodbine Field profits deposited in Ed, Sr.'s personal account and for other misappropriated funds. Skelley and the Third Party Defendants (collectively appellants) asserted the claims were barred by accord and satisfaction and estoppel.

The final controversy relevant to this appeal was over ownership and possession of the Briar Tree house where Ed, Sr. and Skelley lived. Under the prenuptial agreement, the Briar Tree house was the separate property of Ed, Sr. However, as part of his estate planning, Ed, Sr. deeded the Briar Tree house to the Janet Gibbs Skelley Marital Trust created under his will, reserving a life estate for himself. Ed, Sr. then kept the deed with his will and other estate related documents. After Ed, Sr.'s death, Skelley recorded the deed, bought houses in Florida and California, moved to Florida, and allowed her personal assistant to move into the Briar Tree house. The Sons argued the deed conveying the Briar Tree house was ineffective because it was never delivered and that Skelley abandoned and waived any homestead rights.

After a lengthy jury trial, the probate court purported to enter judgment on the verdict. By way of damages, the court first awarded the Estate $967,219 from appellants based on the jury's finding that Ed, Sr. fraudulently transferred that amount of assets to appellants. Next, the court ordered that the Sons' Trusts were not to recover funds reimbursed by acceptance of the deed to the Hayden Ranch because the jury found the Sons were barred by the doctrine of accord and satisfaction and estopped from bringing claims regarding the misappropriation of funds from the Sons' Trusts prior to August 1, 1988. Nevertheless, the court also ordered Skelley to pay the Sons' Trusts and Ed, Jr., the following damages because the jury found Skelley defrauded and misappropriated funds from the Sons' Trusts and Ed, Jr:

Andrew T. Hayden Trust $103,825.38;

William W. Hayden Trust $108,813.20;

Edward D. Hayden, Jr., Trust $109,762.85;

Ed, Jr., individually $131,659.74.

Finally, the trial court determined the Estate owed Skelley $452,220.57 under the promissory note which the jury found was not a fraudulent obligation.

In addition to damages, the probate court permanently enjoined appellants from selling or transferring assets and subjected all of appellants' assets to a constructive trust in favor of the Estate. The Briar Tree home was awarded to the Janet Gibbs Skelley Marital Trust, and the court found Skelley did not abandon or waive any homestead rights. Finally, the probate court awarded the recovery of attorney's fees (1) by the Estate in the amount of $15,847.50 from appellants, (2) by the Sons in the amount of $390,649.99 from appellants; and (3) by Skelley in the amount of $62,464.86 from the estate.

Fraudulent Conveyances

Appellants challenge in their first point of error the portion of the judgment awarding the Estate $967,219 due to allegedly fraudulent transfer of assets to Skelley and the Third Party Defendants. Appellants contend neither the Sons nor the estate have standing to contest the allegedly fraudulent conveyances. We agree.

Although appellants never raised standing at trial, standing is a component of subject matter jurisdiction and cannot be waived.*fn4 See Texas Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 443-44 (Tex. 1993). To establish standing, a party must show (1) a real controversy exists between the parties, and (2) the controversy will be actually determined by the judicial relief sought. See State Bar of Texas v. Gomez, 891 S.W.2d 243, 245 (Tex.1994). When an appellate court considers standing for the first time, we construe the petition in favor of the party asserting the cause of action, and if necessary, review the entire record to determine if any evidence supports standing. See Texas Ass'n of Bus., 852 S.W.2d at 446. If the trial court lacked subject matter jurisdiction, then an appellate court only has jurisdiction to set aside the judgment and dismiss that portion of the case. See Dallas County Appraisal Dist. v. Funds Recovery, Inc., 887 S.W.2d 465, 468 (Tex. App._Dallas 1994, writ denied).

The crux of the Sons'

allegation is that the fraudulent transfers made by Ed, Sr. did not change the character of the property transferred because article XVI, section 15 of the Texas Constitution provides that spouses may partition their property between themselves only if they do so "without the intention to defraud pre-existing creditors." Tex. Const. art. XVI, § 15. The Sons argue they have standing to assert the fraudulent transfer allegations because the ultimate issue is merely the characterization of the transferred property, and as interested parties in the probate proceedings, they have standing to assert characterization issues. However, this analysis misses the pivotal issue of whether the property was part of the Estate, and therefore subject to characterization, at the time of Ed, Sr.'s death.

The Sons admit the property in question was transferred by Ed, Sr. to Skelley and the Third Party Defendants.*fn5 However, the Sons also argue the transferred property never left Ed, Sr.'s separate estate because the transfers by Ed, Sr. were fraudulent, and article XVI, section 15 permits the transfer of property between spouses only when the spouses have no intention of defrauding existing creditors. We conclude the property did not remain part of Ed, Sr.'s separate estate.

In Texas, it is clear that fraudulently conveyed property does not remain in the estate of the grantor. The Texas Supreme Court, in Markward v. Murrah, 138 Tex. 134, 156 S.W.2d 971 (1941), held the estate of a grantor retains no interest in fraudulently conveyed property and the decedent parts with all title to the property when he makes the fraudulent transfer. See id. at 974; see also John Hancock Mut. Life Ins. Co. v. Morse, 132 Tex. 534, 124 S.W.2d 330, 332 (1939) (holding that a grantor in a fraudulent transaction is bound by the transfer). We see no reason, and the Sons have not presented any, why article XVI, section 15 alters this rule when the fraudulent transfer is between spouses. Article XVI, section 15 merely states spouses are not to transfer property among themselves to defraud creditors; it does not state that such transfers are void as to non-creditors. Therefore, we conclude the property transferred by Ed, Sr. did not remain in his separate estate and cannot be distributed through the Estate unless the transfers are voided. See Tex. Prob. Code Ann. § 58(a) (Vernon Supp. 2000) (a person may only devise property he has at the time of his death). Consequently, we must address whether the Sons or the Estate have standing to challenge the validity of the transfers.

We first note that the Sons, as heirs, lack standing on this issue because, in general, only the personal representative of the decedent's estate is entitled to sue for the recovery of estate property during an estate's administration. See Shepard v. Ledford, 962 S.W.2d 28, 31 (Tex. 1998). In addition, conveyances made to defraud creditors are voidable only by creditors named in the Fraudulent Transfer Act, and neither the Sons nor the Estate are creditors. See John Hancock Mut. Life Ins. Co.,124 S.W.2d at 332; Tex. Bus. & Com. Code Ann. § 24.008 (Vernon 1987).*fn6 Under the Fraudulent Transfer Act, a "creditor" is defined as a person with a claim, and a "claim" is a right to payment or property. See Tex. Bus. & Com. Code Ann. § 24.002(3), (4) (Vernon Supp. 2000). Because the Sons are only heirs, they had no right to payment or property from their father. See Tex. Prob. Code Ann. § 94 (Vernon 1980). Furthermore, the Estate is not a creditor because Ed, Sr. could not have had a right to payment or property against himself. Therefore, neither the Estate nor the Sons have standing to assert the fraudulent transaction allegations.

The Sons argue there exists a common law right of heirs to challenge the validity of fraudulent transactions by a decedent which was recognized in Volkmer v. Chase, 354 S.W.2d 611, 614 (Tex. Civ. App._Houston [1st Dist.] 1962, writ ref'd n.r.e.). The court in that case speculated, in dicta, that heirs may have a cause of action to recover property fraudulently conveyed by their mother. However, this concept is directly contrary to overwhelming authority. While the case law in this area is quite old, it is well settled that a decedent's heirs and estate have no standing to contest the validity of an inter vivos transaction by a decedent on the grounds that the decedent conveyed the property with the purpose of defrauding creditors. See John Hancock Mut. Life Ins., 124 S.W.2d at 332; Harcrow v. Reed, 425 S.W.2d 59, 60 (Tex. Civ. App._Waco 1968, writ ref'd n.r.e.).*fn7 The courts of this state will not encourage fraudulent transactions by allowing a grantor to regain property through his estate which he fraudulently conveyed during his lifetime. See In re Parker, 997 S.W.2d 833, 838 (Tex. App._Texarkana 1999, pet. denied); Poe v. Hamlin Nat'l Bank, 921 S.W.2d 515, 517 (Tex. App._Eastland 1996, writ denied).*fn8 Therefore, the Sons' claim that there is a common law right of heirs to challenge the fraudulent inter vivos transactions of a decedent is without merit.

Finally, the Sons argue article XVI, section15 gives them and the Estate standing to assert their fraudulent conveyance claims. This article, however, does not contain any such statement, and the policies against permitting an estate from recovering property transferred by the decedent in fraud of the rights of creditors apply equally well when the grantee is the decedent's spouse. The courts of this state will not encourage fraudulent transactions. See In re Parker, 997 S.W.2d at 838. Therefore, we do not agree that article XVI, section 15 gives the Sons or the Estate standing to challenge the allegedly fraudulent conveyances.

We conclude neither the Sons nor the Estate have standing to assert the fraudulent transaction allegation. Therefore, we sustain appellant's first point of error, reverse the judgment on this claim, and dismiss this claim for want of jurisdiction. Because of our disposition of this point of error, we need not address appellants' second point of error in which they contend this claim was barred by res judicata and their fifth point of error in which they claim the damage award must be reversed because the Sons failed to obtain a finding that the damages were proximately caused by the fraudulent transfers.

Equitable Estoppel and Accord and Satisfaction

We next address appellants' third point of error in which they contend the probate court erroneously awarded damages to the Sons from Skelley based on the jury's findings that Skelley misappropriated funds from and committed constructive fraud against the Sons' Trusts.*fn9 Appellants point out the jury also found the claims regarding damages to the Sons' Trusts predating August 1, 1988 were barred by the doctrines of estoppel and accord and satisfaction. Furthermore, appellants claim there is no evidence of any damages to the Sons' Trusts after August 1, 1988. Consequently, they conclude, the Sons were not entitled to recover the damages awarded by the probate court. We agree in part.

Under Rule of Civil Procedure 301, the trial court must conform its judgment to the verdict unless upon motion and reasonable notice the court renders judgment n.o.v. or determines the verdict is not supported by the evidence. See Tex. R. Civ. P. 301; City of Dallas v. Arnett, 762 S.W.2d 942, 955 (Tex. App._Dallas 1988, writ denied). The court may not, in the absence of an appropriate motion, disregard jury findings. See Arnett, 762 S.W.2d at 955. It is the duty of the trial court to reconcile apparent conflicts in jury findings whenever reasonably possible. See City of Harker Heights v. Sun Meadows Land, Ltd., 830 S.W.2d 313, 316 (Tex. App._Austin 1992, no writ).

The basis for the Sons' allegations that Skelley misappropriated funds and defrauded the Sons' Trusts is evidence that Skelley deposited money owed to the Sons' Trusts into Ed, Sr.'s personal accounts. The jury agreed that the Sons' Trusts were damaged by Skelley's wrongful conduct. However, based on the agreement transferring the Hayden Ranch to the Sons' Trusts, the jury also found any claims regarding damages to the Sons' Trusts arising before August 1, 1988 were barred by the doctrine of accord and satisfaction and that the Sons' were estopped from asserting any such claims. The Sons argue the transfer of the Hayden Ranch merely served to offset the debt in an amount equal to the Ranch's value and that the offset was accounted for in the jury's award. However, it is well settled that an accord and satisfaction completely bars recovery on claims arising out of the settled matter, see Stewart Title Guar. Co. v. Aiello, 941 S.W.2d 68, 73 (Tex. 1997),*fn10 and estoppel completely prevents a party from asserting an otherwise valid right, see David McDavid Nissan, Inc. v. Subaru of America, Inc., 10 S.W.3d 56, 71 (Tex. App._Dallas 1999, no pet. h.).*fn11 Furthermore, the Sons' do not contest the jury's findings that their claims are barred by estoppel and accord and satisfaction; they dispute only the effect of these findings. Therefore, in accordance with the jury's verdict, we conclude acceptance of the deed to the Hayden Ranch barred any further recovery on the debts which arose before August 1, 1988. The probate court's judgment conflicts with the jury's verdict, and the court did not properly disregard any of the jury's findings.*fn12 Consequently, we sustain appellant's third point of error.

Although we conclude the Sons' Trusts cannot recover on the claims which arose before August 1, 1988, the evidence contains several checks made out to the Sons' Trusts which were deposited by Skelley into Ed, Sr.'s personal account after August 1, 1988. Consequently, there is evidence which would support some award of damages to the Sons' Trust. Furthermore, while the instruction on damages should have accounted for the possibility that the jury would find the Sons' pre-August 1, 1988 claims barred and estopped, Skelley bore the burden of requesting such a limitation, and she failed to do so. See Jim Howe Homes v. Rogers, 818 S.W.2d 901, 903 (Tex. App._Austin 1991, no writ). Therefore, instead of rendering judgment, we reverse the damage awards the Sons' Trusts and remand for proceedings to determine the amount of damages which arose after August 1, 1988.

Damages to the Sons' Trusts and Edward Hayden, Jr., Individually

Appellants challenge in their fourth, sixth, and tenth points of error the damage awards to the Sons' Trusts and Ed, Jr.*fn13 In their fourth point of error, appellants argue the awards were barred by the statute of limitations and that the trial court erred in refusing to submit an instruction on limitations to the jury. Appellants contend in their sixth point of error that the awards are not supported by the verdict because the Sons failed to obtain a finding that the damages were proximately caused by Skelley's misconduct. Finally, in their tenth point of error, appellants allege the evidence is factually and legally insufficient to support the awards. We disagree with the contentions in appellants' sixth and tenth points of error and decline to address appellants' fourth point of error.

We first address appellants' tenth point of error in which they contend the evidence is legally and factually insufficient to support the damage awards to the Sons' Trusts and Ed, Jr. Specifically, appellants argue the evidence established Ed, Sr. committed the wrongful acts, not Skelley. In addition, appellants allege the evidence was insufficient to support the amount of damages awarded because the report of James Herblin, the Sons' expert witness, was the only evidence presented on the issue and the report was based on speculation. We disagree with both contentions.

In reviewing the legal sufficiency of the evidence, we view the evidence in a light most favorable to the findings, consider only the evidence and inferences that support the findings, and disregard all evidence and inferences to the contrary. See Seidel v. Seidel, 10 S.W.3d 365, 368 (Tex. App._Dallas 1999, no pet.). We will uphold the trial court's findings if more than a scintilla of evidence exists to support them. See id. In addressing appellants' factual sufficiency challenge, we examine all of the evidence and set aside the findings only if they are so against the great weight and preponderance of the evidence that they are clearly wrong and unjust. See Vickery v. Vickery, 999 S.W.2d 342, 376 (Tex. 1999); Siedel, 10 S.W.3d at 368. If we sustain appellants' legal sufficiency points, we must render judgment in favor of appellants. See R.S. v. B.J.J., 883 S.W.2d 711, 714 (Tex. App._Dallas 1994, no writ). If we sustain appellants' factual sufficiency points, we must remand for a new trial. See id.

First, we conclude there is sufficient evidence in the record to support the jury's finding that Skelley is liable for the alleged misconduct. It is well settled that when two or more persons jointly engage in the commission of a tort, they are jointly and severally liable. See Morgan v. Compugraphic Corp., 675 S.W.2d 729, 733 (Tex. 1984); Austin Road Co. v. Pope, 147 Tex. 430, 216 S.W.2d 563, 565 (1949).*fn14 Here, Skelley admitted depositing numerous checks addressed to the Sons' Trusts and Ed, Jr., into Ed, Sr.'s account. Because Skelley actively participated in the alleged misconduct, we conclude the evidence is legally and factually sufficient to support the jury's findings that Skelley is liable for fraud and misappropriation of funds.

Next, we address appellants' contention that the evidence is insufficient to support the amount of damages awarded to the Sons' Trusts and Ed, Jr. Appellants claim the only evidence supporting the damage awards was James Herblin's report and testimony, and that Herblin's opinions were based on speculation. Specifically, appellants complain that Herblin admitted he "estimated" the amount of money owed to the Sons' Trusts and Ed, Jr., from the sale of oil and gas leases in the Bryan Woodbine Field to Exxon in March, 1986.*fn15 Appellants also allege that Herblin's damage estimates contain amounts which the Sons' Trusts were barred and estopped from recovering. Consequently, appellants conclude the evidence is insufficient to support the damage awards. Because all of appellants' complaints concern damages which arose before August 1, 1988 and we have already concluded the Sons cannot recover for damages to their trust which arose before that date, we need only address the sufficiency of the evidence supporting Ed, Jr.'s award.

In Burroughs Wellcome Co. v. Crye*fn16 and Shaefer v. Tex. Employers Ins. Assoc.,*fn17 the Texas Supreme Court held that expert opinions have no probative value when the factual bases underlying the opinions are not supported by evidence in the record. See Burroughs Wellcome Co., 907 S.W.2d at 499; Shaefer, 612 S.W.2d at 204-05. Here, Herblin concluded in his report that Ed., Jr., was owed $62,792.24 from the Exxon sale. Herblin stated his determination was based on information he found in a later agreement which mentioned that Exxon paid $565,636.80 in the transaction. Based on Ed, Jr.'s interest in the transaction, Herblin was able to determine that Ed, Jr., was owed $62,792.24. Herblin also determined that the $62,792.24 was never recorded in Ed, Jr.'s books. While the later agreement was not admitted into evidence, appellants did not object to the admission of Herblin's report as proof of the transaction or the amount Exxon paid See Owens-Corning Fiberglass Corp. v. Keeton, 922 S.W.2d 658, 660 (Tex. App._Austin 1996, writ denied) (holding that evidence admitted without limitation is before the court for all purposes). Therefore, the record contain's Herblin's statements as proof of the factual bases underlying his opinions. Accordingly, Herblin's report was probative of the amount owed Ed, Jr., from the Exxon sale. Based on Herblin's report and the lack of any conflicting evidence, we conclude the evidence supporting Ed, Jr.'s award is legally and factually sufficient. We overrule appellants' tenth point of error.

In their sixth point of error, appellants claim the awards to Ed, Jr., and the Sons' Trusts are not supported by the verdict because the Sons failed to obtain a finding that the damages were proximately caused by Skelley's misconduct. Under Rule of Civil Procedure 279, an independent theory of recovery is waived if it is omitted from a charge entirely. See Tex. R. Civ. P. 279; Ramos v. Frito-Lay, Inc., 784 S.W.2d 667, 668 (Tex. 1990). If, however, issues are omitted which constitute only a part of an independent ground and other issues which necessarily refer to that ground are submitted and answered, the omitted elements are deemed found in support of the judgment if no objection is made and they are supported by factually sufficient evidence. See Tex. R. Civ. P. 279; Ramos, at 668.

It is clear that proximate causation is only a part of the independent grounds of misappropriation and constructive fraud which were submitted and found by the jury. In addition, appellants have not directed our attention to, nor have we found, an objection in the record to the omission. Therefore, the necessary proximate cause finding will be deemed in support of the judgment if there is factually sufficient evidence to support such a finding. See Tex. R. Civ. P. 279; Ramos, at 668.

Proximate causation encompasses two distinct elements:

(1) cause in fact and (2) foreseeability. See Union Pump Co. v. Albritton, 898 S.W.2d 773, 775 (Tex. 1995). An act or omission is a cause in fact if it was a substantial factor in bringing about the injury which would not have occurred otherwise. See id.; Prudential Ins. Co. v. Jefferson Assocs., 896 S.W.2d 156,161 (Tex.1995). "Foreseeability" means that the actor, as a person of ordinary intelligence, should have anticipated that her conduct would injure others. See Reed v. Scott Fetzer Co., 990 S.W.2d 732, 737 (Tex. 1998); Travis v. City of Mesquite, 830 S.W.2d 94, 98 (Tex. 1992).

As noted above, it is undisputed that Skelley actively participated in depositing funds belonging to Ed, Jr., and the Sons' Trusts into Ed, Sr.'s personal account. From this evidence, the jury could reasonably conclude such conduct was a substantial factor contributing to the damages suffered by Ed, Jr., and the Sons' Trusts. Furthermore, a person of ordinary intelligence should have foreseen that this type of misconduct would injure the Sons' Trusts and Ed, Jr. Therefore, we conclude the evidence was sufficient to support a finding that Skelley's conduct proximately caused the damages to the Sons' Trusts and Ed, Jr. The omitted proximate cause finding is deemed in support of the probate court's judgment. We overrule appellants' sixth point of error.

Finally, with respect to appellants' fourth point of error, we decline to address whether the awards to the Sons' Trusts and to Ed, Jr., are barred by the statute of limitations. The awards were based on two independent findings that Skelley misappropriated funds and committed constructive fraud.*fn18 Appellants do not argue the misappropriation cause of action was barred by the statute of limitations, and we have already overruled appellants' challenges which addressed the misappropriation finding. Therefore, the misappropriation finding constituted an independent basis for recovery which supported the damage award. As such, we need not address whether the constructive fraud cause of action is barred by the statute of limitations. See Nationwide Property & Cas. Ins. Co. v. McFarland, 887 S.W.2d 487, 496 (Tex. App._Dallas 1994, writ denied).*fn19 We decline to address appellant's fourth point of error as moot.

Constructive Trust

In appellants' eighth point of error, they argue the probate court abused its discretion in imposing a constructive trust on the assets of Skelley and the Third Party Defendants in favor of the Estate. Appellants make several arguments challenging the propriety of the trust, including a claim that the trust should not have been imposed in favor of the Estate. We agree.

A constructive trust is an equitable remedy imposed on property when it would be unconscionable for the holder of the legal title to retain and enjoy the beneficial interest. See Fitz-Gerald v. Hull, 237 S.W.2d 256, 262 (Tex. 1951). The trial court should impose a constructive trust only in favor of those who are truly and equitably entitled to the trust property. See id. We review the trial court's decision for an abuse of discretion. See Carr v. Weiss, 984 S.W.2d 753, 767 (Tex. App._Amarillo 1999, pet. denied).

In this case, the probate court imposed a constructive trust in favor of Ed, Sr.'s estate, even though Ed, Sr. undoubtedly participated in the allegedly fraudulent transfers. While it may be unconscionable for Skelley and the Third Party Defendants to retain assets obtained through conveyances made in fraud of creditors, it was just as unconscionable to impose a constructive trust in favor of the estate of a participant in the wrongdoing. As we have already concluded, the courts of this state will not encourage fraudulent transactions by allowing a grantor to regain property through his estate which he conveyed during his lifetime to defraud his creditors. See In re Parker, 997 S.W.2d at 838; Poe, 921 S.W.2d at 517. Therefore we conclude the probate court abused its discretion in imposing this constructive trust. We sustain appellants' eighth point of error and render judgment setting aside the constructive trust.

Permanent Injunction

In their ninth point of error, appellants argue the probate court erred in imposing a permanent injunction to prevent Skelley and the Third Party Defendants from disposing of assets except when necessary for ordinary living and business expenses. Appellants contend imposition of an injunction is not justified under the evidence. We disagree.

To warrant the issuance of a permanent injunction, the probate court must find (1) the existence of a wrongful act; (2) the existence of imminent harm; (3) the existence of irreparable injury; and (4) the absence of an adequate remedy at law. See Priest v. Texas Animal Health Comm'n, 780 S.W.2d 874, 875-76 (Tex. App._Dallas 1989, no writ). Appellants challenge the sufficiency of the evidence supporting all four elements. We review the trial court's determination for an abuse of discretion. See id.; Risk Managers Int'l, Inc. v. State, 858 S.W.2d 567, 569-70 (Tex. App._Austin 1993, writ denied).

At trial, the Sons offered the testimony of Fred Wylie to support imposition of the permanent injunction. Wylie testified Skelley told him before trial that she believed the Sons would lose the litigation and that if they won there would be no money for them to recover. Also, Skelley testified that she had moved some of the assets at issue out of state. From this evidence, the trial court could have reasonably found Skelley intended to avoid paying any judgment in favor of the Sons by dissipating or hiding all of the assets under her control. Such an act would be clearly wrongful, and based on Wylie's testimony, the court could have concluded harm to the Sons was imminent. See Krier v. Navarro, 952 S.W.2d 25, 28 (Tex. App._San Antonio 1997, pet. denied) (holding that a threatened wrong is sufficient basis for granting injunctive relief).

Moreover, the evidence supports the trial court's conclusion that, without an injunction, the Sons would suffer an irreparable injury without an adequate remedy at law. A party demonstrates an irreparable injury when it shows that an award of damages months later will not provide adequate compensation. See Houston Feder'n of Teachers, Local 2415 v. Houston Indep. Sch. Dist., 730 S.W.2d 644, 646 (Tex. 1987); Mitchison v. Houston Indep. Sch. Dist., 803 S.W.2d 769, 773 (Tex. App._Houston [14th Dist.] 1991, writ denied). A party has no adequate remedy at law when damages are incapable of calculation or the party to be enjoined is incapable of responding in damages. See Recon Exploration, Inc. v. Hodges, 798 S.W.2d 848, 851 (Tex. App._Dallas 1990, no writ); SRS Products Co. v. LG Engineering Co., 994 S.W.2d 380, 386 (Tex. App._Houston [14th Dist.] 1999, no pet.). If Skelley were permitted to dissipate assets as she allegedly threatened, any later judicial action to enforce the judgment against Skelley would be meaningless because there would be no assets left to satisfy the judgment and Skelley would be incapable of responding in damages. Consequently, the evidence supports the trail court's finding that if Skelley's threatened conduct were not enjoined, the Sons would suffer an irreparable harm without an adequate remedy at law.

Because there is evidence in the record supporting the permanent injunction, we conclude the trial court did not abuse its discretion. We acknowledge that the record contains some evidence which suggests imposition of an injunction in this case was improper. However, trial court does not abuse its discretion when its decision is based on conflicting evidence. See Recon Exploration, Inc., 798 S.W.2d 851. Therefore, we overrule appellants' ninth point of error.

Attorney's Fees Awarded to the Sons

Appellants contend in their seventh point of error that the probate court erred in awarding $390,649.99 in attorney's fees to the Sons' because the award was not allowable under any theory of law. The Sons argue the probate court's award was permissible under the Texas Uniform Declaratory Judgments Act, the common fund doctrine, and the probate court's equitable jurisdiction. We conclude the award cannot be based on any legal theory asserted by the Sons.

We first address the Sons' claim that the award was allowable under the Declaratory Judgments Act. As appellants point out, the Sons assert this Act as a basis for recovery of fees for the first time on appeal. The Sons did not invoke the attorney's fee provision of the Act in their pleadings or their motion for attorney's fees. This Court has directly addressed this issue before, and we cannot sustain an award of attorney's fees based on the Declaratory Judgments Act when the Act was not pled as a basis for recovery at trial. See Hartford Cas. Ins. Co. v. Budget Rent-A-Car Systems, Inc., 796 S.W.2d 763, 771 (Tex. App._Dallas 1990, writ denied); but see Canales v. Zapatero, 773 S.W.2d 659, 660 (Tex. App._San Antonio 1989, writ denied).

Next, the Sons claim their attorney's fees are recoverable under the common fund doctrine. The common fund doctrine represents an exception to the general rule that, absent a statutory or contractual basis for an award of attorney's fees, each litigant must bear his own fees. See Arnett, 762 S.W.2d at 954. Under the common fund doctrine, the court may allow reasonable attorney fees to a complainant who, at his own expense, has maintained a suit which creates a fund benefitting other parties as well as himself. See Knebel v. Capital National Bank, 518 S.W.2d 795, 799-801 (Tex.1974); Arnett, 762 S.W.2d at 954.

In this case, the Sons contend they maintained the fraudulent conveyance allegation at their own expense which benefitted both them and the Estate. However, we have already concluded the Sons' and the Estate lacked standing to assert the fraudulent conveyance allegation. Because the Sons have not prevailed on this, their only claim that might have benefitted the Estate, they have not created a benefit to the Estate that would entitle them to recover their attorney's fees. Accordingly, we conclude the award of attorney's fees to the Sons cannot be based on the common fund doctrine.

Finally, the Sons argue the award of attorney's fees to the Sons was within the equitable power of the probate court. The Sons claim that, as an exception to the general rule, attorney's fees can be recovered by a party who defends a lawsuit that would not have occurred but for the actions of another party even if recovery is not authorized by statute or agreement. In support of this proposition, they cite GXG, Inc. v. Texacal Oil & Gas,*fn20 Hartford Cas. Ins. Co. v. Walcer County Agency, Inc.,*fn21 and Baja Energy Inc. v. Ball.*fn22

These cases hold that when a party is forced to protect his interests in litigation against third parties, he is entitled to recover legal fees in a separate action from the person whose wrongful acts caused the litigation with the third parties. See GXG, Inc., 977 S.W.2d at 424; Hartford Cas. Ins. Co., 808 S.W.2d at 689; Baja Energy, Inc., 669 S.W.2d at 838-39. We conclude, however, that the Sons may not recover attorney's fees on this basis.

We first note that this Court has refused to adopt this exception. In Peterson v. Dean Witter Reynolds, Inc., 805 S.W.2d 541 (Tex. App._Dallas 1991, no writ), we refused to permit the recovery of attorney's fees based on this exception in a suit to recover fees which were incurred in a prior action with a third party. See Peterson, 805 S.W.2d at 549; see also City of Garland v. Booth, 895 S.W.2d 766, 771-72 (Tex. App._Dallas 1995, writ denied). In addition, we see no reason, and the Sons do not cite any, why we should permit recovery under this rule in cases where the attorney's fees are requested in the same litigation in which they arose. If attorney's fees were recoverable under this exception, the trial court would have complete discretion to award attorney's fees in nearly every case where a party prevails on a claim of wrongful conduct because normally the wrongful conduct caused the litigation. This "exception" could replace the well established rule that a trial court cannot award attorney's fees to a prevailing party unless the award is authorized by statute or agreement. See Arnett, 762 S.W.2d at 954. Therefore, we determine the probate court did not have equitable authority to award attorney's fees to the Sons.

Because the Sons did not present at trial or on appeal any statute, agreement, or exception which would permit them to recover attorney's fees in this case, we conclude the probate court abused its discretion by awarding attorney's fees to the Sons. We sustain appellants' seventh point of error and render judgment that the Sons take nothing on their claim for attorney's fees.

Promissory Note

We now turn to the Sons' cross-complaints. In their fourth complaint, the Sons contend the evidence is legally and factually insufficient to support the jury's finding that the Estate owed Skelley $452,220.51 under a promissory note executed by Ed, Sr. in favor of Skelley. The Sons argue the evidence established that (1) Skelley completed the note without authorization; (2) the note was not supported by consideration; and (3) Ed, Sr. did not sign the note. We disagree with all three contentions.

We address the Sons' legally and factual sufficiency challenges under the same standards we used to address appellants' tenth point of error. To recover on this note, Skelley bore the burden of proving (1) the note in question; (2) Ed, Sr. signed the note; (3) Skelley was the owner or holder of the note; and (4) a certain amount was due and owing. See Bean v. Bluebonnet Savings Bank FSB, 884 S.W.2d 520, 522 (Tex. App._Dallas 1994, no writ); Cockrell v. Republic Mortgage Ins. Co., 817 S.W.2d 106, 111 (Tex. App._Dallas 1991, no writ). The Sons contest only the sufficiency of the evidence supporting the first, second, and third elements.

First, Skelley had to establish the note in question. The Sons contend the evidence presented failed to meet this burden because the evidence conclusively established the note was completed without authorization. Specifically, the Sons claim the note is unenforceable because several material terms, including the amount due, the payee, and the date of execution, were added by Skelley after the note was allegedly signed by Ed, Sr. However, an obligor's liability on a note is not discharged because of later additions if the obligor assented to the alterations. See Tex. Bus. & Com. Code Ann. § 3.407 (Vernon Supp. 2000). Furthermore, the Sons bore the burden of proving any additions were made without Ed, Sr.'s authorization, see Tex. Bus. & Com. Code Ann. § 3.115 (Vernon Supp. 2000), and there is no evidence that the alleged additions were unauthorized. Therefore, the record does not support the Sons' allegation that the note is unenforceable because Skelley made additions. We conclude admission of the note into evidence with Skelley's testimony that it was the original note was sufficient to establish the note in question.

Next, Skelly bore the burden of establishing Ed, Sr. signed the note. The Sons' argue the evidence supporting this element was insufficient because Ed, Jr., testified the signature on the note looked like Skelley's version of his father's signature and that Skelley admitted signing Ed, Sr.'s name to other documents. However, Skelly testified she did not sign Ed, Sr.'s name to the note, and Ed, Sr.'s signature was witnessed by Carl Hillis. The jury was entitled to rely on the attestation of Carl Willis and believe Skelley's testimony over Ed, Jr.'s. See McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986); Service Lloyds Ins. Co. v. Martin, 855 S.W.2d 816, 822 (Tex. App._Dallas 1993, no writ). Therefore, we conclude the jury's finding that Ed, Sr. signed the note was supported by legally and factually sufficient evidence.

Finally, Skelly was required to prove she was the legal holder of the note. According to the Sons, the evidence conclusively established Skelley gave no consideration for the note because the $463,000 loaned to Ed, Sr. was actually Ed, Sr.'s separate property transferred to Skelley to avoid paying his debt to the U.S. government. However, we have already concluded the property was not part of Ed, Sr.'s separate estate. Regardless of his intentions, Ed, Sr. transferred that property to Skelley and the Third Party Defendants. Therefore, Skelley did provide consideration for the note by loaning Ed, Sr. $463,000. Because the Sons do not make any other challenges to evidence supporting Skelley's status as legal holder of the note, we conclude the evidence is legally and factually sufficient.

We need not address whether the evidence supports the jury's finding that an amount was due under the note because the Sons do not challenge that finding. Therefore, we conclude the evidence supporting the jury's verdict that the Estate owed Skelley money under the note was supported by legally and factually sufficient evidence. We overrule the Sons' fourth cross-point.

Briar Tree House

In the Sons' first, second, and third cross-complaints, they challenge the probate court's judgment regarding the Briar Tree house. The Sons argue in their first cross-complaint that the evidence is legally and factually insufficient to support the jury's finding that the deed to the house was delivered to the Janet Gibbs Skelley Marital Trust (the Marital Trust). In their second cross-complaint, the Sons contend Skelley waived any homestead interest she had in the house. Finally, the Sons allege in their third cross-complaint the evidence is legally and factually insufficient to support the jury's finding that Skelley did not abandon her homestead interest in the house. We conclude the evidence is sufficient to support the finding that the deed was delivered; consequently, we decline to address the Sons' second and third cross-complaints.

To effectively deliver a deed, a party must deliver the deed with the intent to divest himself of title in the property. See Stephens County Museum, Inc. v. Swenson, 517 S.W.2d 257, 262 (Tex. 1974). The Sons argue the evidence fails to establish Ed, Sr. delivered the deed or that he intended to divest himself of title in the Briar Tree House because (1) Ed, Sr. made no gift tax return; (2) Ed, Sr. testified numerous times that the house was still his separate property; (3) Ed, Jr., testified Skelley asked him to deed the house to her after Ed, Sr. died; (4) Skelley failed to record the deed until after Ed, Sr.'s death; and (5) Skelley's own attorney, Terry Lustig, testified he gave the deed to Ed, Sr. for safe keeping.

At trial, Terry Lustig testified that he provided estate planning advice to both Ed, Sr. and Skelley in late 1992. According to Lusting, Ed, Sr. deeded the Briar Tree House to the Marital Trust, retaining a life interest, so that he could use the house during his lifetime and Skelley would receive the benefit of the house without the need for a complicated probate proceeding after his death. Lusting also advised Ed, Sr. not to record the deed for tax and homestead purposes. Finally, Lusting testified Ed, Sr.'s purpose in the estate planning was to transfer all his assets to trusts so that the property would pass at his death without necessitating probate proceedings.

In addition to Lustig's testimony, Skelley testified Ed, Sr. delivered the deed to her prior to his death and Skelley declined to admit she asked Ed, Jr., to deed her the house after Ed, Sr.'s death. Skelley only admitted she received "confusing" legal advice about the ownership of the house.

Based on this testimony, we conclude the evidence was sufficient for the jury to conclude Ed, Sr. delivered the deed to the Marital Trust intending to divest himself of title in the house. Skelley testified Ed, Sr. delivered the deed to her, and Lusting testified Ed, Sr. intended to divest himself of all his assets to avoid the necessity of probate proceedings at his death. Furthermore, the jury could have reasonably concluded Ed, Sr. was merely confused about the characterization of the house as his separate property because he did not understand the implications of the life interest he retained. Although there was some conflict in the evidence regarding whether Ed, Sr. delivered the deed and what his intentions were at the time the deed was executed, the jury was entitled to resolve those conflicts as they did. See McGalliard, 722 S.W.2d at 697; Service Lloyds Ins. Co., 855 S.W.2d at 822. We conclude the jury's finding is supported by more than a scintilla of evidence and is not against the great weight and preponderance of the evidence. Therefore, we overrule the Sons' first cross-complaint.

Because of our disposition of this point of error, we need not address whether Skelley abandoned or waived her homestead rights. As a beneficiary of the Marital Trust, Skelley is entitled to use the house for her benefit regardless of whether she retains her homestead interests. Therefore, we will not address the Sons' second and third cross-complaints.

Attorney's Fees

Awarded to Skelley

Finally, we address the Sons' fifth cross-complaint in which they argue the evidence in the record is legally and factually insufficient to support the probate court's award of $62,464.86 in attorney's fees to Skelley. The Sons claim Skelley is entitled to recover attorney's fees only for her claim on the promissory note. The evidence Skelley presented, however, did not segregate recoverable and non-recoverable attorney's fees. Consequently, the Sons argue, Skelley failed to present sufficient evidence to support an award of attorney's fees for the promissory note claim. We agree.

As a general rule, the party seeking to recover attorney's fees bears the burden of proving the fees requested are reasonable and necessary. See Stewart Title Guar. Co. v. Sterling, 822 S.W.2d 1, 10 (Tex. 1991). To show the reasonableness and necessity of attorney's fees, Skelley must establish that her fees were incurred while prosecuting a claim which allows recovery of such fees. See id. Typically, a party who recovers on only a portion of its claims must segregate the fees that were incurred while pursing the successful claims from the fees incurred pursuing the unsuccessful claims. See International Sec. Life Ins. Co. v. Finck, 496 S.W.2d 544, 546-47 (Tex. 1973). However, when the causes of action arise from the same facts or circumstances and are so interrelated that their prosecution entails proof of the same facts, the party seeking to recover attorney's fees need not segregate recoverable from non-recoverable fees. See Stewart Title Guar. Co., 822 S.W.2d at 10-11. Because this issue was tried before the probate court and the court did not enter findings of fact or conclusions of law, we will assume it made any findings supported by the evidence which are necessary to affirm the judgment. See Warford v. Stamper, 801 S.W.2d 108, 109 (Tex. 1990).

Because the probate court awarded Skelley all of the attorney's fees she requested, we will assume the probate court found that the causes of action in this case were too intertwined to permit the segregation of attorney's fees. Also, we agree with the Sons' contention that Skelley was entitled to recover fees only for her promissory note claim. At trial, the only basis Skelley asserted for recovering her legal fees was section 38.001 of the Civil Practice and Remedies Code, and the only claim in this case which falls under that section is the promissory note claim.*fn23 Therefore, we will affirm the probate court's award if the record supports the inference that Skelley's promissory note claim was so intertwined with the other issues at trial that segregation was not necessary.

The record indicates that at trial the Sons presented a complicated theory of recovery in which they alleged Ed, Sr. engaged in an elaborate scheme of fraudulent conveyances to avoid paying a judgment he owed to the U.S. government. As part of that scheme, the Sons claimed Ed, Sr. executed a promissory note to borrow money he had fraudulently conveyed to Skelley so that he could pay the settlement he reached with the government. Therefore, the Sons claimed the promissory note was a fraudulent obligation made in connection with the allegedly fraudulent conveyances. Clearly, these claims arose from the same set of facts and are substantially intertwined.

However, the Sons also brought allegations that Skelley defrauded and misappropriated funds from the Sons' Trusts and Ed, Jr., and that Ed, Sr. never delivered the Briar Tree House deed to the Marital Trust. These claims have no relation to the promissory note claim; they do not arise from the same facts or circumstances and are not intertwined with the promissory note allegation. Therefore, the record does not support the trial court's implied finding that all of the claims on which Skelley incurred attorney's fees were so intertwined that segregation was not necessary. We sustain the Sons' fifth point of error, and remand this issue for further consideration. See Stewart Title Guar. Co., 822 S.W.2d at 11 (holding that an award of attorney's fees erroneously based upon evidence of unsegregated fees must be remanded).

Conclusion

In summary, we reverse and remand the damages awarded to the Sons' Trusts and the award of attorney's fees to Skelley. In addition, we (1) reverse the constructive trust and render judgment setting it aside; (2) reverse the judgment based on the fraudulent conveyance claims and dismiss the these claims for want of jurisdiction; and (3) reverse the award of attorney's fees to the Sons and render judgment that the Sons take nothing on the claim for fees. Otherwise, we affirm the probate court's judgment.

TOM JAMES, JUSTICE

Do Not Publish

Tex. R. App. P. 47

Opinion Footnotes

*fn1 Justice John Ovard was on the panel at the time the Court's original opinion issued on July 31, 2000. Due to his retirement from this Court on July 31, 2000, Justice Ovard did not participate in the issuance of this Opinion on Rehearing. See Tex. R. App. P. 41.1 (a), (b).

*fn2 The Third Party Defendants are Inco Energy, L.C., Injoy, Ltd., HH Exploration, Inc., Janet G. Skelley Separate Property Trust, Janet Skelley Marital Trust, Janet Gibbs Skelley Irrevocable Trust, Janet Gibbs Skelley Family Trust, Janet Gibbs Skelley Separate Property Living Trust, Janet Gibbs Skelley Separate Property Trust, JGS Separate Property Trust, Skelley Separate Property Trust, Jeffrey J. Skelley II Memorial Trust, Jeffrey James Skelley II Trust, Edward D. Hayden, Sr., Irrevocable Trust, Edward D. Hayden, Sr. Trust, Edward D. Hayden, Sr., Marital Trust, and HH Family Trust

*fn3 The three inter vivos trusts were the Edward D. Hayden, Jr., Trust; the William W. Hayden Trust; and the Andrew T. Hayden Trust. These inter vivos trusts are not the same as the three testamentary trusts created in Ed, Sr.'s will.

*fn4 The Sons argue, based on our decision in Thompson v. Harco Nat'l Ins. Co., 997 S.W.2d 607 (Tex. App._Dallas 1998, pet denied), that standing in this case is not a component of subject matter jurisdiction. In Thompson, this Court concluded standing to seek dissolution of a writ of garnishment under Rule of Civil Procedure 664a is not part of subject matter jurisdiction because it is a procedural issue; it did not affect the trial court's jurisdiction over the proceedings or the parties. See id. In contrast, this point of error does not involve an issue of standing under a rule of procedure. The issue here is whether the Sons or the Estate have standing to assert the fraudulent transfer claims under substantive law. Therefore, standing in this case is not a procedural issue as in Thompson, but a component of subject matter jurisdiction.

*fn5 While the Sons argue no consideration was given for the property and that the evidence shows no gift was made, there was no dispute at trial that Ed, Sr. transferred legal title of the property in question before he died.

*fn6 See also Ransom v. Ransom, 252 S.W.2d 212, 213 (Tex. Civ. App._Fort Worth 1952, no writ).

*fn7 See also Markward v. Murrah, 156 S.W.2d 971, 974 (Tex. 1941); Vratis v. Wilbanks, 287 S.W. 666, 667 (Tex. Civ. App._Fort Worth 1926, no writ); Scarborough v. Blount, 154 S.W. 312, 313 (Tex. Civ. App._Galveston 1913, no writ).

*fn8 See also Dominguez v. Trent, 836 S.W.2d 677 (Tex. App.--El Paso 1992, no writ); Leal v. Cortez, 603 S.W.2d 262 (Tex. Civ. App.--Corpus Christi 1980, writ ref'd n.r.e.); Letcher v. Letcher, 421 S.W.2d 162 (Tex. Civ. App.--San Antonio 1967, writ dism'd); Garcia v. Garcia De Ortiz, 257 S.W.2d 804 (Tex. Civ. App.--San Antonio 1953, no writ); Bramlett v. Jenkins, 231 S.W.2d 539 (Tex. Civ. App._Fort Worth 1950, writ ref'd n.r.e.)

*fn9 The damages were awarded to the Sons because the Sons' Trusts were dissolved by the time of trial.

*fn10 See also Harris v. Rowe, 593 S.W.2d 303, 306 (Tex. 1979); Hycarbex, Inc. v. Anglo-Suisse, Inc., 927 S.W.2d 103, 110 (Tex. App._Houston [14th Dist] 1996, no writ); Priem v. Shires, 697 S.W.2d 860, 863-64 (Tex. App._Austin 1985, no writ).

*fn11 See also Fabrique, Inc. v. Corman, 796 S.W.2d 790, 792 (Tex. App._Dallas 1990) writ denied, 806 S.W.2d 801 (Tex. 1991) (per curiam); LaRue v. LaRue, 832 S.W.2d 387, 391 (Tex App._Tyler 1992, no writ); Lone Star Steel v. Scott, 759 S.W.2d 144, 154 (Tex. App._Texarkana 1988, writ denied); Koelzer v. Pizzirani, 718 S.W.2d 420, 423 (Tex. App._Fort Worth 1986, no writ).

*fn12 Although the probate court ostensibly limited the recovery of the Sons' Trusts to damages not barred by the jury's findings, the damages awarded to the Sons' Trusts equaled those calculated by James Herblin which included amounts incurred before August 1, 1988. Therefore, the probate court did not actually limit recovery to post-August 1, 1988 damages.

*fn13 Although we have already concluded the Sons' Trusts are not entitled to the entire amount of damages awarded by the probate court, if we were to sustain appellants' fourth, sixth, or tenth point of error we would be required to render judgment in favor of appellants. Therefore, we must still address whether these three points of error bar recovery by the Sons' Trusts.

*fn14 See also Bradford v. Vento, 997 S.W.2d 713, 734 (Tex. App._Corpus Christi 1999, no pet.); Century 21 Page One Realty v. Naghad, 760 S.W.2d 305, 310 (Tex. App._Texarkana 1988, no writ).

*fn15 Two Exxon sales were discussed in Herblin's report: "Exxon Sale 1" and "Exxon Sale 2." Appellants only challenge Herblin's opinion with respect to Exxon Sale 2.

*fn16 907 S.W.2d 497 (Tex. 1995).

*fn17 612 S.W.2d 199 (Tex. 1980).

*fn18 The damage awards were found by the jury in response to question number eight which asked, "What was the value of the assets, if any, subject to the misappropriation, conversion, or constructive fraud of Janet Skelley?"

*fn19 See also Northwest Wholesale Lumber, Inc. v. Leader Lumber, Inc., 785 S.W.2d 402, 406 (Tex. App._Dallas 1989, no writ); Shenandoah Assoc. v. J & K Properties, Inc., 741 S.W.2d 470, 495 (Tex. App._Dallas 1987, writ denied).

*fn20 977 S.W.2d 403 (Tex. App._Corpus Christi 1998, writ denied).

*fn21 808 S.W.2d 681 (Tex. App._Corpus Christi 1991, no writ).

*fn22 669 S.W.2d 836 (Tex. App._Eastland 1984, no writ).

*fn23 Section 38.001 profides: A person may recover reasonable attorney's fees from an individual or corporation, in addition to the amount of a valid claim and costs, if the claim is for: (1) rendered services; (2) performed labor; (3) furnished material; (4) freight or express overcharges; (5) lost or damaged freight or express; (6) killed or injured stock; (7) a sworn account; or (8) an oral or written contract. See Tex. Civ. Prac. & Rem. Code Ann. § 38.001 (Vernon 1997).

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