Court of Appeals of Texas, Fourth District, San Antonio
the 198th Judicial District Court, Kerr County, Texas Trial
Court No. 1793B Honorable Rex Emerson, Judge Presiding
Sitting: Sandee Bryan Marion, Chief Justice, Marialyn
Barnard, Justice, Luz Elena D. Chapa, Justice
Marialyn Barnard, Justice
Texas Farmers Insurance Company ("Texas Farmers")
appeals from a no-answer default judgment in favor of
appellee Steven L. Clack. On appeal, Texas Farmers contends
the trial court erred in: (1) denying its motion for new
trial/motion to set aside the default judgment (hereafter,
"motion for new trial"); and (2) awarding Clack
post judgment interest pursuant to section 542.060(a) of the
Texas Insurance Code. We affirm the trial court's
filed an insurance claim based on his policy with Texas
Farmers. Clack sought to recover for hail damage to his
property. After inspection, Texas Farmers claimed the damage
covered by the insurance policy failed to exceed the
deductible. According to Texas Farmers, much of the damage
was "marring" to Clack's metal roof, which is
excluded under the policy.
dissatisfied with Texas Farmers response to his claim, filed
suit against Texas Farmers on January 26, 2017, alleging
claims for breach of contract, violations of the Texas
Deceptive Trade Practices Acts (the "DTPA"), and
violations of Chapter 541 of the Texas Insurance Code.
Through its litigation manager, Texas Farmers admitted
Clack's petition was served on Texas Farmers on February
3, 2017. However, Texas Farmers failed to file a timely
answer. See Tex. R. Civ. P. 99(b) (stating petition
shall direct defendant to file written answer to petition on
or before 10:00 a.m. on Monday next following expiration of
twenty days after service of citation). Three days after
Texas Farmers' answer was due, Clack sought a default
judgment. At the default judgment hearing, Clack presented
evidence relating to: (1) proof of service; (2) damage to his
roof beyond marring, and notice of same to Texas Farmers; and
(3) monetary damages, including actual damages and damages
for violations of the DTPA and Insurance Code. The trial
court granted judgment in favor of Clack. In its default
judgment, the trial court awarded Clack actual damages,
"[e]xemplary damages, " trial attorney's fees,
contingent attorney's fees in the event a motion for new
trial was filed, contingent appellate attorney's fees,
prejudgment interest, post judgment interest pursuant to
section 542.060(a) of the Insurance Code, and court costs.
Farmers timely filed a motion for new trial. In the motion,
Texas Farmers argued the trial court should set aside the
default judgment because it had satisfied the requirements of
Craddock v. Sunshine Bus Lines, 133 S.W.2d 124 (Tex.
1939). Clack challenged the motion, arguing Texas Farmers had
not met any of the Craddock requirements.
Thereafter, Texas Farmers sought leave of court to amend its
previously filed motion for new trial and filed an amended
motion for new trial. The trial court denied the motion for
leave to file the amended motion for new trial. After a
hearing, the trial court denied Texas Farmers' motion for
new trial. Texas Farmers then timely perfected this appeal.
stated in the introduction, Texas Farmers raises two issues
challenging the trial court's default judgment in favor
of Clack. First, Texas Farmers contends the trial court erred
in denying its motion for new trial. Texas Farmers argues the
trial court should have granted its motion for new trial
because it met all three prongs of Craddock by: (1)
establishing its failure to answer was not intentional or the
result of conscious indifference, but was based on accident
or mistake; (2) setting up a meritorious defense; and (3)
demonstrating that setting aside the default judgment would
not cause delay or prejudice to Clack. See id.
Second, Texas Farmers contends the trial court erred in
awarding post judgment interest under section 542.060(a) of
the Insurance Code because: (1) the award is not supported by
Clack's pleadings; and (2) Clack cannot recover 18% post
judgment under section 542.060(a) on anything other than the
amount of the actual underlying insurance claim. See
Tex. Ins. Code Ann. § 542.060(a) (West Supp. 2017).
- Motion for New Trial
Farmers first contends the trial court erred in denying its
motion for new trial. Texas Farmers argues it established all
three Craddock requirements, mandating the trial
court to grant its motion.
the supreme court's 1939 decision in Craddock, a
default judgment should be set aside and a new trial granted
if the defaulting party establishes: (1) the failure to
appear was not intentional or the result of conscious
indifference, but was the result of an accident or mistake;
(2) the motion for new trial sets up a meritorious defense;
and (3) granting the motion will occasion no delay or
otherwise injure the plaintiff. Dolgencorp of Tex., Inc.
v. Lerma, 288 S.W.3d 922, 925-26 (Tex. 2009) (citing
Craddock, 133 S.W.3d at 126); Saenz v.
Saenz, No. 04-16-00588-CV, 2017 WL 2351101, at *1 (Tex.
App.-San Antonio May 31, 2017, no pet.) (mem. op.). A trial
court's refusal to grant a motion for new trial is
reviewed under an abuse of discretion standard.
Dolgencorp of Tex., Inc., 288 S.W.3d at 926;
Saenz, 2017 WL 2351101, at *1. A trial court abuses
its discretion in refusing to grant a motion for new trial
following a default judgment only when the defaulting party
establishes all three elements of the Craddock test.
Dolgencorp of Tex., Inc., 288 S.W.3d at 925-26;
Saenz, 2017 WL 2351101, at *1. Although Texas
Farmers argues it satisfied all of the Craddock
requirements, we hold it failed to set up a meritorious
defense, and therefore, the trial court did not err in
denying its motion for new trial.
satisfy the meritorious defense prong of Craddock,
the defaulting party must "must allege facts which in
law would constitute a defense to the cause of action
asserted by the plaintiff, and must be supported by
affidavits or other evidence proving prima facie that the
defendant has such [a] meritorious defense."
Ivy v. Carrell, 407 S.W.2d 212, 214 (Tex. 1966)
(emphasis added); see, e.g., Estate of Pollack
v. McMurrey, 858 S.W.2d 388, 392 (Tex. 1993);
Saenz, 2017 WL 2351101, at *1; In re Adams,
416 S.W.3d 556, 561 (Tex. App.-Tyler 2013, orig. proceeding);
Kyle v. Zepeda, No. 01-11-00388-CV, 2013 WL 2246030,
at *4 (Tex. App.-Houston [1st Dist.] May 21, 2013, no pet.)
(mem. op.); Anderson v. Anderson, 282 S.W.3d 150,
155 (Tex. App.-El Paso 2009, no pet.); In re A.P.P.,
74 S.W.3d 570, 574 (Tex. App.-Corpus Christi 2002, no pet.).
A motion for new trial does not set up a meritorious defense
if "it merely alleges that the defendant has a
meritorious defense." Ivy, 407 S.W.2d at 214.
As stated by the First Court of Appeals in Kyle, the
movant must support its allegation of a meritorious defense
by attaching affidavits to its motion or submitting other
competent evidence. 2013 WL 2246040, at *4. Affidavits or
other evidence providing prima facie proof of a meritorious
defense "is necessary to prevent the reopening of cases