The Dallas Court of Appeals recently decided a case in which it held that it was mandatory for the trial court to grant a trial amendment. The opinion is interesting because its procedural facts suggest other scenarios in which a mandatory trial amendment might be required.

The basic dispute was a contract dispute between Dallas City Limits Property (DCL) and Austin Jockey Club (AJC) involving DCL’s purchase of Longhorn Downs, a subsidiary of AJC.  After the agreement fell through, DCL sued AJC for breach of contract, and AJC counterclaimed for breach of contract.  The salient allegations related to a claim for declaratory judgment that AJC asserted by which AJC contended that its termination of the agreement was justified when DCL breached the agreement.  At the close of trial, AJC announced that it was non-suiting this particular claim.  DCL objected to the non-suit and sought a trial amendment asking for the inverse proposition, i.e. that AJC’s notice of termination was ineffective.  The trial court refused DCL’s requested trial amendment, and a jury returned a verdict in favor of AJC.

On appeal, the court of appeals held that the requested trial amendment was mandatory.  The amendment was requested after the close of trial and the issue had in effect been fully tried.  Neither party was prejudiced by the trial amendment.  By non-suiting its declaratory judgment, AJC prevented the trial court from considering the inverse proposition of the declaratory judgment which was the legal effect of the jury’s breach findings on AJC’s termination of the Agreement. The non-suit would have deprived DCL of this defense; thus, the court of appeals held that the amendment was mandatory.  Because contract disputes frequently involve mirror-image disputes, this opinion may be important in many such contract disputes.

The court’s opinion in Dallas City Limits Property Co. v. Austin Jockey Club, Ltd may be found here.