The Dallas Court of Appeals recently confirmed that attorney’s fees are not economic damages. In this case, a party objected to testimony regarding attorney’s fees because the opposing party failed to include the attorney’s fees information in its response to a TRCP194.2(d) request to disclosure the amount and method of calculating economic damages. The court of appeals stated that "the calculation of attorney’s fees incurred [ ] is not an economic damage . . . ." Thus, it is clear that attorney’s fees are not damages except in rare and narrow circumstances. The court of appeals also reiterated that a contractual provision regarding attorney’s fees controls over statutory requirements, such as Chapter 38. The court’s opinion in Jespersen v. Sweetwater Ranch Apartments can be found here.
This case is interesting in light of the current dispute concerning whether attorney’s fees must be superseded on appeal. The Texas Supreme Court recently heard oral argument on November 7th in the Nalle Plastics case in which the issue is squarely presented. In a nutshell, the issue in Nalle Plastics is whether the phrase "compensatory damages" includes attorney’s fees.
There has been much focus on the nature of attorney’s fees (compensatory vs. penal) in an effort to determine whether attorney’s fees are compensatory. But there is a simpler answer. We are all familiar with the variety of damages under Texas law, e.g., actual, direct, consequential, special, exemplary, etc. The question is not whether attorney’s fees are "compensatory" but whether they are damages at all. If they are not damages, they can’t be compensatory damages, as compensatory damages are merely a subset of damages generally. So unless a party seeks attorney’s fees as damages, they are not compensatory damages.