Andress v. Meah Investments No. 2, Ltd.
(Tex.App.- Houston [1st  Dist] Sep. 10, 2009)(Keyes)(fraud, fraudulent inducement, exemplary damages)
The trial court failed to assess exemplary damages to Andress and DesignCare
separately, as required by the Texas Civil Practices and Remedies Code. See Tex.
Civ. Prac. & Rem. Code Ann. § 41.006; Computek, 156 S.W.3d at 224. Rather, the
trial court erred as a matter of law by improperly assessing exemplary damages
against Andress and DesignCare jointly and severally.
AFFIRM TC JUDGMENT IN PART, REVERSE TC JUDGMENT IN PART, AND REMAND CASE TO TC FOR
FURTHER PROCEEDINGS: Opinion by
Justice Keyes   
Before Justices Jennings, Keyes and Higley  
01-07-00792-CV Morris Andress v. Meah Investments No. 2, Ltd.   
Appeal from 239th District Court of Brazoria County
Trial Court Judge: Hon. Patrick Edward Sebesta

MEMORANDUM OPINION

Appellant Morris Andress appeals from a trial court judgment holding him personally liable for various
corporate acts committed while he served as president and director of DesignCare, Inc. In five issues,
Andress argues that: (1) the trial court erred in holding him personally liable to appellee, Meah Investments
No. 2, Ltd. ("Meah Investments"), for the acts of DesignCare because there is no evidence that he acted
outside his corporate capacity; (2) the trial court erred as a matter of law in holding that he was personally
liable for breach of contract damages on a contract between DesignCare and Meah Investments; (3) the
evidence presented at trial was insufficient to support the trial court's conclusion of law holding that he
committed fraud against Meah Investments; (4) the trial court erred as a matter of law in awarding Meah
Investments exemplary damages because there was no evidence or insufficient evidence to prove Andress
committed fraud against it; and (5) the trial court erred as a matter of law in failing to specify the amount of
damages assessed for each of the defendants at trial.

We affirm in part, reverse in part, and remand the case for further proceedings.

Background

DesignCare is a Texas corporation specializing in designing healthcare and assisted living facilities. Nizam
Meah, a gastroenterologist practicing in Lake Jackson, Texas, was a partial owner and manager of Meah
Investments. Meah Investments, a Texas limited partnership, served as an investor behind Dr. Meah's
commercial real estate acquisitions.

Dr. Meah sought an architectural firm to design a 10,000 square foot ambulatory service center and
medical office located at 109 Parking Way in Lake Jackson, Texas ("Meah Project"). After receiving a
recommendation from a contractor, Dr. Meah contacted Andress to inquire about using DesignCare's
services to design the Meah Project. After several preliminary conversations, DesignCare agreed to design
the ambulatory service center.

On September 18, 2000, Meah Investments and DesignCare executed a contract, using a form contract
written by the American Institute of Architects and attaching an addendum clarifying certain clauses in the
contract. In the contract, Meah Investments was named as the owner of the Meah Project and DesignCare
was named as the architect of the Meah Project. The contract also named Michael Horan, a licensed
architect employed by DesignCare, as the "Architect's Designated Representative" for the Meah Project. In
the contract, Meah Investments agreed to timely pay all monthly invoices and reimbursable expenses
presented by DesignCare.

The parties signed the contract as follows: Dr. Meah signed over a signature block entitled "Owner." Below
this signature block, the words "Meah Management No. 2, Ltd. by Meah Investments, LLC, Manager" were
handwritten and the words "Nizam M. Meah, M.D." were typewritten. Andress signed over a signature block
entitled "Architect." Below this signature block, the words "Morris Andress, President" were typewritten.

On September 22, 2000, the parties signed a letter addendum to the contract entitled "Revised-Fee
Proposal for Ambulatory Service Center." Andress signed above a signature block reading "Morris
Andress, President." Dr. Meah signed below a signature block reading "Agreed and Accepted, Meah
Investments No. 2 by Meah Investments, LLC."

On October 6, 2000, DesignCare billed Meah Investments $11,205.00 for asbestos abatement
coordination, a field survey, a building background drawing, and a preliminary floor plan. On November 10,
2000, DesignCare billed Meah Investments $15,787.50 for construction documents and architectural and
computer-aided drafting work. On December 1, 2000, DesignCare billed Meah Investments $5,445.00 for
construction documents and architectural and computer-aided drafting work. On December 29, 2000,
DesignCare billed Meah Investments $29,311.76 for construction documents, third-party services, and
various reimbursable expenses. Meah Investments timely paid all invoices as required under the contract
terms. The sum of the billed invoices through December 29, 2000 totaled $61,749.26. According to
DesignCare's records, DesignCare had completed work valued at $10,169.11 by December 29, 2000 that
had already been invoiced.

On January 19, 2001, Dr. Meah and Andress engaged in an e-mail exchange concerning the slow
progress of the Meah Project. In the exchange, Dr. Meah repeatedly asked about various timelines for
completing the architectural work. Dr. Meah also wrote, "I was told that since this is not a multi-speciality
surgical center, things are simple and straight forward and things could go a little faster." Andress replied
that because DesignCare did not receive information from Meah Investments in a timely fashion,
DesignCare's completion of the architectural work was delayed. Andress stated that DesignCare was
"working very hard to get this done and we are very close to being completed. Try to understand these
project[s] take time because all of [sic] the individuals and firms that are involved."

On May 24, 2001, DesignCare billed Meah Investments $22,865.92 for construction documents and
reimbursable expenses. Dr. Meah disputed the invoice because of the construction delays on the Meah
Project. DesignCare and Meah Investments agreed that Meah Investments would pay one-half of the
invoiced amount. On June 12, 2001, Meah Investments paid $11,432.96 to DesignCare, as required under
the terms of the payment arrangement agreement.

Between August 1, 2001 and September 1, 2001, DesignCare billed Meah Investments $12,305.05 for
construction documents. Meah Investments did not pay these expenses and hired counsel to give notice to
DesignCare that Meah Investments intended to terminate the contract due to DesignCare's "failure to
substantially perform in accordance with the terms" of the contract. On October 21, 2001, Meah
Investments filed suit against DesignCare, Andress, Melinda Andress, and Michael Horan. In its amended
petition, Meah Investments alleged breach of contract, fraud, misrepresentation, negligence, professional
malpractice, DTPA violations, and denudation of the corporation.

On November 13, 2001, DesignCare filed a mechanic's and materialman's lien against the property of the
Meah Project to collect unpaid invoices then totaling $12,305.05. On December 14, 2001, DesignCare filed
its answer and pled a counterclaim against Meah Investments for its failure to pay those unpaid invoices.
Trial to the bench began on August 1, 2006. At trial, Meah Investments' counsel questioned Andress about
his architectural qualifications. Andress testified that he was not an architect, did not have an architectural
degree, and had never been licensed as an architect. Andress also denied that he told Dr. Meah that he
was an architect at any time during their business relationship. He testified that he did not manage
DesignCare's invoices and was uncertain as to whether the billing to Meah Investments was done prior to
or after the billed work was completed. He also testified that when he wrote to Dr. Meah that the
architectural work was "close to being completed," he was using the best information he had at the time of
the statement.

Horan, the designated architect for the Meah Project in the contract between Meah Investments and
DesignCare, testified in response to Meah Investment's counsel's questions that he had no knowledge that
Andress held himself out as an architect to Dr. Meah. Horan also testified that he had previously made an
affidavit stating that he "was the architect on the project and performed or supervised all aspects of
contract negotiations and client contact with Dr. Meah of [Meah Investments]." He also testified that he did
not have any role in the contract negotiations between DesignCare and Meah Investments. Horan testified
that he did the architectural work on the Meah Project and Andress did no architectural work on the Meah
Project.

Dr. Meah testified that, during their first conversation, Andress said that he was a licensed architect. Dr.
Meah also testified that Andress encouraged him to do internet research on his background and
experience. Dr. Meah testified that he used the internet to research Andress's background and experience
and discovered several articles written by Andress that represented that Andress was a licensed architect
with a degree from the University of Houston. Dr. Meah testified that he relied on Andress's experience
throughout the course of the Meah Project because Andress had made a strong impression on him during
their first conversation.

He testified that he and Andress negotiated the Meah Project contract and that he never knew that Horan
was involved with the Meah Project until after the contract was terminated. Dr. Meah testified that he sent
an e-mail to Andress on January 19, 2001 to document his conversations with Andress because
DesignCare was delaying its work and sent another e-mail on February 16, 2001 because he was "getting
really concerned that things [were] not being done." Dr. Meah testified that DesignCare never delivered a
set of construction documents for the Meah Project. He hired another architect to complete the Meah
Project and terminated the contract with DesignCare.

On cross-examination, Dr. Meah testified that he did not receive any invoice or make any payment to
Andress individually. All invoices were sent from DesignCare and all payments were made to DesignCare.
He also testified that "Morris Andress is DesignCare to me."

On June 11, 2007, the trial court issued a judgment in favor of Meah Investments that reads, in relevant
part:

After hearing all of the evidence and considering all of the evidence and the argument of counsel on
behalf of the parties, the Court was [sic] of the opinion that Final Judgment in favor of the Plaintiff was
proper. The Court finds that Plaintiff, Meah Investments No. 2 Ltd., prevails against the Defendants,
DesignCare, Inc. and Morris Andress, jointly and severally, on its claims against the Defendants,
DesignCare, Inc. and Morris Andress, for breach of contract. The Court also finds that the Defendants,
DesignCare, Inc. and Morris Andress, committed fraud against the Plaintiff, Meah Investments No. 2 Ltd.,
and that Plaintiff is entitled to judgment against the Defendants, DesignCare, Inc. and Morris Andress,
jointly and severally, on its claims against the Defendants, DesignCare, Inc. and Morris Andress, for fraud.


The trial court assessed $42,500 in compensatory damages; $25,000 in exemplary damages; prejudgment
interest; postjudgment interest; and $25,000 in attorneys' fees against Andress and DesignCare. The trial
court also issued a take-nothing judgment in favor of Michael Horan.

On July 2, 2007, Andress requested that the trial court issue findings of fact and conclusions of law. On
August 13, 2007, the trial court issued findings of fact, that stated in relevant part:

3. A Defendant is [DesignCare, Inc.], a Texas Corporation ("[DesignCare]").

4. A Defendant is Morris Andress, an individual ("Andress").

5. At all relevant times, Morris Andress was president of [DesignCare].
. . . .

11. Prior to entering the Agreement, Andress represented to Meah and Nizam Meah that he was a
professional registered architect.

12. Prior to entering the Agreement, Andress represented to Meah and Nizam Meah that he was qualified
to perform the professional architectural services required by the Agreement.

13. Prior to entering the Agreement, Andress and [DesignCare] represented to Meah and Nizam Meah that
[DesignCare] was a registered architectural firm.

14. Prior to entering the Agreement, Andress and [DesignCare] represented to Meah and Nizam Meah that
[DesignCare] was a professional architectural firm that was qualified and capable of performing the
services called for by the Agreement in a timely fashion.

15. Prior to entering the Agreement, Andress directed Meah and Nizam Meah to read and review published
information about [DesignCare] and Andress which represented that Andress had an architectural
bachelor's degree from the University of Houston and that Andress had prior experience as a professional
staff architect with St. Joseph's Hospital in Houston.


16. Andress requested that Meah rely upon the information and representations set forth in findings 11,
12, 13, 14 and 15 above in its consideration of whether to enter into the Agreement.


17. Meah relied upon the information and representations set forth in findings 11, 12, 13, 14 and 15 above
in its consideration of whether to enter into the Agreement.


18. The information and representations set forth in findings 11, 12, 13, 14 and 15 above were material as
they relate to the Agreement.


19. Meah was reasonable in its reliance upon the information and representations set forth in findings 11,
12, 13, 14 and 15 above in its consideration of whether to enter into the Agreement.


20. Meah entered into the Agreement in reliance upon the information and representations set forth in
findings 11, 12, 13, 14 and 15 above.


21. Had Meah known that the information and representations set forth in findings 11, 12, 13, 14 and 15
above were untrue, Meah would not have entered into the Agreement.


22. The information and representations set forth in findings 11, 12, 13, 14, and 15 above were not true.

23. Andress and [DesignCare] knew that the information and representations set forth in findings 11, 12,
13 14, and 15 above were not true at the time they were made and at the time information was transmitted
to Meah and Nizam Meah.

24. Andress and [DesignCare] intended that Meah rely upon the information and representations set forth
in findings 11, 12, 13, 14 and 15.

25. Had Meah or Nizam Meah known that Andress was not a degreed and registered architect prior to
entering into the Agreement, Meah would not have entered into the Agreement.

26. The Agreement was improper in that it was not signed on behalf of [DesignCare] by an architect.

27. Meah timely performed all of its obligations pursuant to the Agreement.

28. Meah timely paid [DesignCare] $80,536.53 pursuant to the Agreement for the services of Designcare
and Andress.
. . . .
33. Andress and [DesignCare] represented to Meah on January 19, 2001 that Andress and [DesignCare]
were very close to being completed with the project pursuant to the Agreement was false.

34. The representation to Meah on January 19, 2001 by Andress and [DesignCare] that they were very
close to being completed with the project pursuant to the Agreement was false.

35. When Andress and [DesignCare] made the representations in findings 33 and 34 they knew that they
were false.

36. When Andress and [DesignCare] made the representations in findings 33 and 34 they intended that
Meah rely upon those false representations.

37. The representation[s] in findings 33 and 34 were material and were reasonably relied upon by Meah.

38. Andress and [DesignCare] represented to Meah on January 19, 2001 that the Texas Department of
Health had no problem with the preliminary plan for the building renovation.

39. The representation to Meah on January 19, 2001 by Andress and [DesignCare] that the Texas
Department of Health had no problem with the preliminary plan for the building renovation was false.


40. When Andress and [DesignCare] made the representation in findings 38 and 39 they knew that they
were false.

41. When Andress and [DesginCare] made the representations in findings 38 and 39 they intended that
Meah rely upon those representations.

42. The representation in findings 38 and 39 were material and were reasonably relied upon by Meah.

43. Andress and [DesignCare] represented to Meah on March 20, 2001 that drawings and plans had been
completed.

44. The representation to Meah on March 20, 2001 by Andress and [DesignCare] that drawings and plans
had been completed was false.

45. When Andress and [DesignCare] made the representations in findings 43 and 44 they knew that they
were false.

46. When Andress and [DesignCare] made the representations in findings 43 and 44 they intended that
Meah rely upon those false representations.

47. The representation in findings 43 and 44 were material and were reasonably relied upon by Meah.
. . . .

51. [DesignCare] and Andress failed to provide the professional services required in the Agreement for the
remodeling of an approximately 10,000 square foot building located at 109 Parking Way in Lake Jackson,
Texas (the "Building").

The trial court also issued conclusions of law, which stated in relevant part:

3. Defendants, [DesignCare] and Andress, committed actionable fraud against the Plaintiff, Meah.

4. Defendants, [DesignCare] and Andress, breached the Agreement with Plaintiff, Meah.

5. Plaintiff, Meah, is entitled to judgment against Andress and [DesignCare], jointly and severally, for its
damages in the amount of $42,750.00 as a result of the fraud committed by Defendants, [DesignCare] and
Andress.

6. Plaintiff, Meah, is entitled to judgment against Andress and [DesignCare], jointly and severally, for its
damages in the amount of $42,750.00 as a result of the breach of contract by Defendants, [DesignCare]
and Andress.

7. Plaintiff, Meah, is entitled to judgment against Andress and [DesignCare], jointly and severally, for its
damages in the amount of $25,000.00 as a result of Andress's and [DesignCare's] conduct found by the
Court.
. . . .
9. Plaintiff, Meah, is entitled to judgment against Andress and [DesignCare], jointly and severally, for
attorneys fees in the amount of $25,000.00.
. . . .
11. Plaintiff, Meah, is entitled to judgment against Andress and [DesignCare], jointly and severally, for
pre-judgment interest on damages of $42,750.00 from November 1, 2001 to date of judgment.

12. Plaintiff, Meah, is entitled to judgment against Andress and [DesignCare], jointly and severally, for
post-judgment interest on the entire amount of the judgment from the date of judgment until paid in full.

Personal Liability for Corporate Fraud

In his third issue, Andress argues that there is legally insufficient evidence to support the trial court's
conclusion of law that he committed fraud against Meah Investments.

Standard of Review

A trial court's findings of fact are reviewable for legal sufficiency of the evidence by the same standards
that are applied in reviewing evidence supporting a jury's answer. Catalina v. Blasdel, 881 S.W.2d 295,
297 (Tex. 1994); DeClaire v. G & B McIntosh Family Ltd. P'ship, 260 S.W.3d 34, 43 (Tex. App.--Houston
[1st Dist.] 2008, no pet.). When challenged, findings of fact are not conclusive if, as here, there is a
complete reporter's record. DeClaire, 260 S.W.3d at 43; In re K.R.P., 80 S.W.3d 669, 673 (Tex.
App.--Houston [1st Dist.] 2002, pet. denied). When there is a reporter's record, the trial court's findings of
fact are binding only if supported by the evidence. In re K.R.P., 80 S.W.3d at 673. In analyzing legal
sufficiency, we consider only the evidence and inferences tending to support the challenged finding and
disregard all inferences to the contrary. Min v. Avila, 991 S.W.2d 495, 500 (Tex. App.--Houston [1st Dist.]
1999, no pet.).

Fraud

Elements of common-law fraud are that (1) a material representation was made; (2) the representation was
false; (3) when the speaker made it he knew it was false or made it recklessly without any knowledge of its
truth and as a positive assertion; (4) the speaker made it with the intention that it should be acted upon by
the party; (5) the party acted in reliance on it ; and (6) he thereby suffered injury. In re FirstMerit Bank,
N.A., 52 S.W.3d 749, 759 (Tex. 2001). To establish the element of causation in a fraud claim, a plaintiff
must show that the defendant's acts or omissions were a cause-in-fact of foreseeable losses. Prospect
High Income Fund, ML CBO IV v. Grant Thorton, LLP, 203 S.W.3d 602, 618 (Tex. App.--Dallas 2006, pet.
denied) (citing Marathon Corp. v. Pitzner, 106 S.W.3d 724, 727 (Tex. 2003)). The defendant's acts or
omissions are a cause-in-fact if the plaintiff can show, beyond mere conjecture, guess, or speculation, that
an act or omission was a substantial factor in bringing about an injury which would not otherwise have
occurred. Id. A plaintiff establishes reliance in a fraud claim by showing that the defendant's acts and
representations induced it to either act or refrain from acting, to its detriment. Id.

Fraudulent inducement is a particular species of fraud that arises only in the context of a contract and
requires the existence of a contract as part of its proof. Haase v. Glazner, 62 S.W.3d 795, 798 (Tex. 2001);
Clark v. Power Mktg. Direct, Inc., 192 S.W.3d 796, 799 (Tex. App.--Houston [1st Dist.] 2006, no pet.). That
is, with a fraudulent inducement claim, the elements of fraud must be established as they relate to an
agreement between the parties. Haase, 62 S.W.3d at 798-99.

Here, Meah Investments presented testimony from Dr. Meah stating that Andress represented himself as a
licensed architect with a degree from the University of Houston. Dr. Meah also testified that Andress told
him to do internet research to verify Andress's claims about his background. Dr. Meah testified that he did
internet research and discovered several articles written by Andress representing that Andress was a
licensed architect with a degree from the University of Houston. He relied on the information given to him
by Andress to make his decision to sign a contract with DesignCare.

Meah Investments also presented testimony from Dr. Meah stating that he paid for work that Andress and
DesignCare never completed. Dr. Meah also testified that Andress told him that the work was near
completion in January 2001 and continued to represent that the work was either near completion or at
completion until the termination of the contract. Meah Investments also presented invoices from
DesignCare, of which Andress was president, showing that the company billed Meah Investments for
$61,749.26 in completed architectural work by January 2001, which Meah Investments timely paid, as
required under the contract terms. Meah Investments presented a job detail report showing that
DesignCare had completed only $10,169.11 worth of work by January 2001. Considering only the
evidence and inferences tending to support the trial court's conclusion that Andress committed actionable
fraud based on its finding, we hold that the evidence is legally sufficient to support the trial court's finding.
See DeClaire, 260 S.W.3d at 43; see also Min, 991 S.W.2d at 500.

We overrule Andress's third issue.

Breach of Contract

In his second issue, Andress argues that the trial court erred as a matter of law in finding and concluding
that he was personally liable for breach of the contract between DesignCare and Meah Investments
because he was not in privity of contract with Meah Investments. Specifically, Dr. Meah argues that
Andress breached the contract by failing to provide the architectural services required under the contract.
Because we have already held that the evidence was legally sufficient to support the judgment against
Andress for fraud, we need not consider whether he was liable for breach of contract.

We overrule Andress's second issue.

Capacity

In his first issue, Andress argues that the trial court erred in finding him personally liable for the acts of
DesignCare because there was no evidence that he was acting outside his capacity as an employee of
DesignCare. We construe his argument as contending there is no evidence, i.e., legally insufficient
evidence, to support the trial court's findings of fact numbers 11, 12, 13, 14, 15, 16, 18, 19, 22, 23, 24, 25,
33, 34, 35, 36, 38, 39, 40, 41, 43, 44, 45, 46, 51 and conclusions of law numbers 3 and 4 that Andress
personally committed actionable fraud against Meah Investments and breached the Agreement with Meah
Investments.

Because we have held that the evidence is legally sufficient to support the trial court's conclusion of law
number 3 that Andress committed actionable fraud against Meah Investments, we need not address this
issue. See DeClaire, 260 S.W.3d at 43; see also Min, 991 S.W.2d at 500.

We overrule Andress's first issue.

Proof of Exemplary Damages

In his fourth issue, Andress argues that the trial court erred as a matter of law in awarding Meah
Investments exemplary damages because there was no evidence or insufficient evidence that Andress
committed fraud.

Exemplary damages are "levied against a defendant to punish the defendant for outrageous, malicious, or
otherwise morally culpable conduct." Tex. Civ. Prac. & Rem. Code Ann. § 41.001(5) (Vernon 2008);
Transportation Ins. Co v. Moriel, 879 S.W.2d 10, 16 (Tex. 1994). Unless otherwise provided by statute,
exemplary damages may be awarded only if the claimant proves by clear and convincing evidence that the
harm with respect to which the claimant seeks recovery of exemplary damages results from (1) fraud; (2)
malice; or (3) gross negligence. Tex. Civ. Prac. & Rem. Code Ann. § 41.003(a) (Vernon 2008); see also In
re Barnes, 369 B.R. 298 (Bankr. W.D. Tex. 2007).

Whenever the standard of proof at trial is elevated, the standard of appellate review must likewise be
elevated. S.W. Bell Tel. Co. v. Garza, 164 S.W.3d 607, 627 (Tex. 2004) (citing In re J.F.C., 96 S.W.3d 256,
266 (Tex. 2002)). In reviewing the evidence for legal sufficiency to support a finding that must be proved
by clear and convincing evidence, we must look at all the evidence in the light most favorable to the finding
to determine whether a reasonable trier of fact could have formed a firm belief or conviction that its finding
was true. Diamond Shamrock Ref. Co v. Hall, 168 S.W.3d 164, 170 (Tex. 2005); Garza, 164 S.W.3d at
627. To give appropriate deference to the fact-finder's conclusions and the role of a court conducting a
legal sufficiency review, we must assume that the fact-finder resolved any disputed facts in favor of its
finding if a reasonable fact-finder could have done so. Hall, 168 S.W.3d at 170.

We must also disregard all evidence that a reasonable fact-finder could have disbelieved or found to be
incredible. Hall, 168 S.W.3d at 170; Garza, 164 S.W.3d at 627. If we determine that no reasonable
fact-finder could form a firm belief or conviction that its finding was true, then we must conclude that the
evidence is legally insufficient. Hall, 168 S.W.3d at 170; Garza, 164 S.W.3d at 627.

We have previously held that there was legally sufficient evidence to prove that Andress committed fraud
against Meah Investments. Based on the record before us, we conclude that the trial court could have
reasonably formed a firm belief that the harm suffered by Meah Investments resulted from Andress's fraud.
See Hall, 168 S.W.3d at 170; Garza, 164 S.W.3d at 627. Therefore, we hold that the trial court's findings of
fact satisfied the clear and convincing standard necessary to impose exemplary damages upon Andress.
Tex. Civ. Prac. & Rem. Code Ann. § 41.003(a); Hall, 168 S.W.3d at 170; Garza, 164 S.W.3d at 627.

We overrule Andress's fourth issue.

Exemplary Damages Specific to Defendant

In his fifth issue, Andress argues that the trial court erred as a matter of law in failing to specify the amount
of exemplary damages assessed for each of the defendants at trial.

"In any action in which there are two or more defendants, an award of exemplary damages must be specific
as to a defendant, and each defendant is liable only for the amount of the award made against that
defendant." Tex. Civ. Prac. & Rem. Code Ann. § 41.006 (Vernon 2008); Computek Computer & Office
Supplies, Inc. v. Walton, 156 S.W.3d 217, 224 (Tex. App.--Dallas 2005, no pet.) (statute prohibited trial
court from awarding exemplary damages jointly and severally against former employee and his company in
former employer's action for misappropriation of trade secrets and other claims, even if former employee
and his company were closely related).

Here, the trial court made the following conclusion of law regarding exemplary damages:

7. Plaintiff, Meah, is entitled to judgment against Andress and DesignCare, jointly and severally, for its
damages in the amount of $25,000.00 as a result of Andress's and Designcare's conduct found by the
Court.

The trial court failed to assess exemplary damages to Andress and DesignCare separately, as required by
the Texas Civil Practices and Remedies Code. See Tex. Civ. Prac. & Rem. Code Ann. § 41.006;
Computek, 156 S.W.3d at 224. Rather, the trial court erred as a matter of law by improperly assessing
exemplary damages against Andress and DesignCare jointly and severally.

We sustain Andress's fifth issue, reverse the judgment on this issue and remand the case to the trial court
to determine the exemplary damages, if any, assessed against Andress individually.

Conclusion

We affirm in part, reverse in part, and remand the case to the trial court for further proceedings consistent
with this opinion.

Evelyn V. Keyes  

Justice


Panel consists of Justices Jennings, Keyes, and Higley.