AUSTIN – The Texas Supreme Court has ruled that $1 million in damages awarded to a ranch hand was unconstitutionally excessive.
The April 28 ruling stems from a malicious prosecution case brought by ranch hand Larry Wayne Grant in an alleged cattle-rustling incident.
Grant filed the lawsuit against rancher Tom Bennett and James B. Bonham Corp., alleging he was being blackmailed after their alleged involvement in the theft of 13 head of cattle.
The court ruled that the exemplary damages awarded Grant were grossly excessive despite the fact that no cap on exemplary damages applies in the case because it is based on felony criminal conduct. In addition, the court found that the amount was excessive compared to the $10,703 in actual damages a jury awarded the ranch hand.
The case stems from an incident 15 years ago in San Cabo County. According to court documents, Grant was working at Bennett’s ranch when the 13 head of cattle wandered onto Bennett’s property. Instead of returning the cattle to the owner, Bennett allegedly instructed Grant to round up the cattle and sell them. Fearing he was doing something illegal, Grant photographed the cattle as they were being sold.
Following the sale, Grant approached Bennett informing him of the photos before turning them over to police, which led to Bennett’s arrest for cattle theft.
Bennett later accused Grant of using the photos to blackmail him and sought criminal charges against him. Grant was indicted, but the indictments were dropped nine months later because the charges were filed after the statute of limitations had expired.
In response, Grant sued Bennett for malicious prosecution and was awarded $10,703 in actual damages and $1 million each against Bennett and Bonham Corp. in exemplary damages.
Bennett appealed the decision.
The appellate court found the exemplary damages too excessive, reducing the award to $512,109 against each defendant. Upon appeal, Bennett argued the jury heard no evidence of potential harm to support the exemplary damages award.
On April 28, the court reversed the lower court’s decision, saying "exemplary damages should be evaluated in light of the potential harm Grant might have suffered as a result of Bennett’s conduct," noting that since the charges were thrown out, Grant’s chances of being imprisoned was “essentially zero."
"We conclude the court of appeals erred in considering the harm that plaintiff would suffer from wrongful imprisonment when the chances of this occurring were essentially zero given the expired statute of limitations,” Justice Don Willett wrote for the court. "Accordingly, we reverse the portion of the court of appeals’ judgment awarding exemplary damages."
The court also noted that "Grant had the burden to prove that imprisonment was likely – an impossible burden given the preclusive effect of limitations. The court of appeals engaged in speculation when making its calculations, contrary to the definition of potential harm provided by the United States Supreme Court.”
The case has been remanded to the appellate court.