law-one-satisfaction-rule

law-one-satisfaction-rule | single recovery for same tort | dual recovery | election of remedies |
unjust enrichment

The One-Satisfaction Rule

Both questions at issue here— whether attorney's fees should be awarded and whether State Farm is entitled to
subrogation rights—involve the one-satisfaction rule, which is "the longstanding proposition that a plaintiff should
not be compensated twice for the same injury." CTTI Priesmeyer, Inc. v. K & O Ltd. P'ship, 164 S.W.3d 675, 683
(Tex.App.-Austin 2005, no pet.) (citing Stewart Title Guar. Co. v. Sterling, 822 S.W.2d 1, 7 (Tex.1991)); see
Crown Life Ins. Co. v. Casteel, 22 S.W.3d 378, 390 (Tex.2000). The rule guards against a plaintiff receiving a
windfall "by recovering an amount in court that covers the plaintiff's entire damages, but to which a settling
defendant has already partially contributed. The plaintiff would otherwise be recovering an amount greater than
the trier of fact has determined would fully compensate for the injury." First Title Co. v. Garrett, 860 S.W.2d 74, 78
(Tex.1993). The one-satisfaction rule applies both when several defendants commit the same act and when
multiple defendants commit "technically different acts" that result in the same, single injury. AMX Enters., Inc. v.
Bank One, N.A., 196 S.W.3d 202, 206 (Tex.App.-Houston [1st Dist.] 2006, pet. denied) (citing Casteel, 22 S.W.3d
at 390). The application of the rule is not limited to tort claims, and whether the rule may be applied depends not
on the cause of action asserted but rather the injury sustained. Id. (citing El Paso Natural Gas Co. v. Berryman,
858 S.W.2d 362, 364 (Tex.1993); Stewart Title, 822 S.W.2d at 8). Thus, if the plaintiff has suffered only one
injury, even if based on "overlapping and varied theories of liability," the plaintiff may only recover once; "[t]his is
especially true if the evidence supporting each cause of action is the same." Buccaneer Homes of Ala., Inc. v.
Pelis, 43 S.W.3d 586, 590 (Tex.App.-Houston [1st Dist.] 2001, no pet.).

Under the one-satisfaction rule, a plaintiff "is entitled to but one satisfaction for the injuries sustained by him."
Bradshaw v. Baylor Univ., 126 Tex. 99, 84 S.W.2d 703, 705 (1935). An exception to that rule is the collateral
source rule. See Brown v. American Transfer & Storage Co., 601 S.W.2d 931, 936 (Tex.1980); Triumph Trucking,
Inc. v. Southern Corporate Ins. Managers, Inc., 226 S.W.3d 466, 471 (Tex.App.-Houston [1st Dist.] 2006, pet.
denied).

The common law collateral source rule "bars a wrongdoer from offsetting his liability by insurance benefits
independently procured by the injured party." Mid-Century Ins. Co. v. Kidd, 997 S.W.2d 265, 274 & n. 48 (Tex.
1999) (citing Brown v. American Transfer & Storage Co., 601 S.W.2d 931, 934-36 (Tex. 1980) (holding that a
wrongdoer cannot receive credit for insurance independently procured by the injured party)). It is said to be a rule
both of evidence and of damages. Taylor v. American Fabritech, Inc., 132 S.W.3d 613, 626 (Tex.App.-Houston
[14th Dist.] 2004, pet. denied).

Under the one-satisfaction rule, a successful litigant is required to elect between remedies
so that she does not receive more than one recovery for the same injury. Chapa, 212 S.W.3d
at 303.[5] The Chapa court recognized that even though the successful plaintiff was limited to one recovery, she
was “entitled to recover on the most favorable theory the verdict would support." Id. at 314. Moreover, she was
not required to make that election “until she knows her choices." Id. Thus, in Chapa, the circumstances involved
a successful litigant who prevailed on several theories at trial and so was entitled to choose the most favorable
remedy to compensate her for her injuries. In contrast to Chapa, Christus has not had the opportunity to choose
the most favorable remedy for its alleged injuries because the trial court granted summary judgment on its fraud
claim. Therefore, Chapa is distinguishable and the one-satisfaction rule does not render the appeal moot.

Under the one satisfaction rule, a plaintiff is entitled to only one recovery for the same loss. Tony Gullo Motors I, L.
P. v. Chapa, 212 S.W.3d 299, 303-04 (Tex. 2006); Crown Life Ins. Co. v. Casteel, 22 S.W.3d 378, 390 (Tex.
2000). The collateral source rule is an exception to the one satisfaction rule. Brown v. Am. Transfer and Storage
Co., 601 S.W.2d 931, 936 (Tex. 1980). Under the collateral source rule, a wrongdoer cannot benefit from
insurance independently procured by the injured party and to which the wrongdoer was not privy. Brown, 601 S.W.
2d at 936; Tex. & Pac. Ry. v. Levi & Bro., 59 Tex. 674 (1883); Taylor v. Am. Fabritech, Inc., 132 S.W.3d 613, 626
(Tex. App.-Houston [14th Dist.] 2004, pet. denied). The right to an offset is an affirmative defense. Brown, 601 S.
W.2d at 936; Superior Trucks, Inc. v. Allen, 664 S.W.2d 136, 149 (Tex. App.-Houston [1st Dist.] 1983, writ ref'd n.r.
e.). The party asserting offset has the burden of pleading offset and of proving facts necessary to support it.
Brown, 601 S.W.2d at 936; Allen, 664 S.W.2d at 149.
Bejjani v. TRC SERVICES, INC., Tex: Court of Appeals, 14-08-00750-CV.14th Dist., Houston November 19, 2009.
Appellants asserted offset in their pleadings and claim a credit for $11,607.91 — the amount of the Safeco check
made jointly payable to William Ferguson and Toyex Bimmer. There is no evidence that this check was ever
cashed. Nonetheless, presuming, without deciding, that TRC Services received $11,607.91 in insurance benefits
from Safeco, these benefits would fall under the collateral source rule. See Brown, 601 S.W.2d at 936; Taylor,
132 S.W.3d at 626. TRC Services independently contracted with Safeco for insurance on its vehicle, and
appellants were not privy to the contract. Therefore, the one satisfaction rule is not applicable. See Brown, 601 S.
W.2d at 936; Taylor, 132 S.W.3d at 626.

Christus Health v. Kone, Inc. (Tex.App.- Houston [14th Dist.] Jun. 25, 2009)(Brown)
(fraud and fraud-in-the-inducement claims relating to a contract for elevator-maintenance services,
one-satisfaction rule does not apply here, pleading sufficiency, special exceptions, affidavit found to be
conclusory)
AFFIRMED: Opinion by Justice Brown
Before Justices Anderson, Frost and Brown
14-07-00786-CV Christus Health and Christus Health Gulf Coast v. Kone, Inc
Appeal from 127th District Court of Harris County
Trial Court Judge: S harolyn P. Wood
Kone relies on the one-satisfaction rule, citing Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 303-04 (Tex.
2006), and argues that the appeal is moot because Christus' damages have “ceased to exist." See Spera v.
Fleming, Hovenkamp & Grayson, P.C., 25 S.W.3d 863, 874 (Tex. App.-Houston [14th Dist.] 2000, no pet.) (stating
that “uncertainty as to the fact of legal damages is 'fatal to recovery'") (citing McKnight v. Hill & Hill Exterminators,
Inc., 689 S.W.2d 206, 207 (Tex. 1985)). Again, however, we disagree.

APPELLATE CASES ADDRESSING THE ONE-SATISFACTION RULE

LJ Charter, LLC v. Air America Jet Charter, Inc. (pdf)(Tex.App.- Houston [14th Dist.] Dec. 15, 2009)(Anderson)
(one satisfaction rule double recovery for a single injury, application of settlement credits)
We affirm the trial court’s judgment in favor of Air America on Air America’s breach of contract cause of action based on the
Agreement. Having sustained part of appellants’ first issue on appeal and Air America’s second and third cross-points on appeal,
we modify the judgment as follows: (1) Air America’s recovery for breach of joint venture fiduciary duty is deleted as a violation of the
One Satisfaction Rule; (2) Air America shall recover $5,980.00 from Charles N. “Trey” Schwarz, III for breach of the oral agreement to
pay for air charter services; and (3) LJ Charter, L.L.C., Charles N. “Buzzy” Schwarz, Jr., and Charles N. “Trey” Schwarz, III, shall be
jointly and severally liable for Air America’s common law fraud damages. Having modified the judgment, we affirm the judgment as
modified.
AFFIRMED AS MODIFIED: Opinion by Justice Anderson
Before Chief Justice Hedges, Justices Anderson and Boyce
14-08-00534-CV LJ Charter, LLC C.N. Schwarz, III, R & S Aircraft Investments, LLC, CNS Ventures, LLC, and
Starflite Management Group, Inc. v. Air America Jet Charter, Inc.
Appeal from 165th District Court of Harris County
Trial Court Judge: Elizabeth Ray

Nowak v. Pellis (Tex.App.- Houston [1st Dist.] Nov. 15, 2007)(Hanks)
(legal and medical malpractice, one satisfaction rule, attorney's fees)
AFFIRM TC JUDGMENT: Opinion by Justice Hanks
Before Justices Taft, Hanks and Higley
01-06-00044-CV John Lewis Nowak v. Jeanne Pellis, et al.
Appeal from 61st District Court of Harris County (Honorable John Donovan)

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