Full opinion text
OPINION DAVID WELLINGTON CHEW, Justice. This is an oil and gas accounting case. Plaintiffs, Patricia Love Stephens, individually and as Trustee of the Walter H. Stephens Trust, the SSH Trust, the Sutton Elizabeth Stephens Irrevocable Trust, and the Heather Love Stephens Irrevocable Trust (collectively “Stephens”), were working interest owners of certain oil and gas wells operated by the defendants Frank W. Cass, individually and d/b/a Cass Oil Company, Michael L. Cass, William G. Cass, and Cass Oil Company, Inc. Stephens sued the Cass defendants for breach of contract, conversion, and fraud. The Casses counterclaimed for breach of contract and defamation. A jury returned findings in favor of Stephens, finding Frank Cass, individually, hable for breach of contract, conversion, and fraud, and finding Michael Cass liable for conversion. The jury found against the Cass defendants on their counterclaims. The trial court entered judgment on the jury’s verdict. On appeal, Frank and Michael Cass raise numerous points of error attacking the testimony of Stephens’ expert witness, the legal and factual sufficiency of the evidence to support the jury’s findings, and the trial court’s imposition of sanctions for discovery abuses. We affirm and reform. SUMMARY OF THE EVIDENCE In 1970, General Walter H. Stephens and Frank W. Cass formed an operating partnership known as Stephens & Cass. The partnership operated properties which General Stephens and Frank Cass acquired individually. From 1970 to 1977, the partnership successfully drilled and operated approximately sixty to seventy wells located in Reagan, Upton, Glassock, and Midland Counties. In 1974, General Stephens’ health began to decline. He suffered a broken hip and had to have surgery. Over the next two years, he had three more surgeries on his hip and eventually had to have his hip replaced. It appears that during this period, General Stephens was not able to meaningfully participate in the daily activities of the partnership. By late 1977, Frank Cass desired to terminate his relationship with General Stephens and bring his son Michael L. Cass into the business. On October 1, 1977, General Stephens and Frank Cass entered into an “Agreement to Terminate” the partnership. By this agreement, the two men agreed to wind up the business by January 1, 1978. They further agreed: to notify all of the' other joint interest owners that Stephens & Cass had agreed to terminate their obligation as operator under the joint operating agreements (“JOAs”); that Mr. Cass would attempt to succeed the partnership as operator; that if Mr. Cass succeeded in obtaining the necessary votes under the JOAs, he would continue to operate the wells pursuant to the existing agreements; that Stephens & Cass would marshal and inventory all personal property owned by the partnership so that it could be valued; and finally that the records of Stephens & Cass would remain the property of both men and would be available to either one as required. Pursuant to the foregoing agreement and the various JOAs, formal written ballots were administered, and Mr. Cass was elected operator by a majority-in-interest of the well owners. On January 1, 1978, Mr. Cass and the General entered into a new operating agreement recognizing that Mr. Cass had been elected operator. In 1980, Mr. Cass and General Stephens reached an agreement and assigned values to the personal property which they jointly owned. In January of 1979, the General slipped on a patch of ice outside his home and suffered a broken back. The General’s wife, Patricia Stephens, took him to the hospital. Apparently, he became over-medicated and slipped into a coma while at the hospital. His air supply was cut off for a period of time. The General eventually recovered, but developed a condition known as Pickwickian Syndrome which caused him to sleep excessively. Mrs. Stephens testified that her husband slept almost twenty hours a day from 1979 until his death in 1984. During this time, the General was unable to handle the vast majority of his financial affairs. Mrs. Stephens helped pay bills, but shé testified that much of her husband’s mail went unopened and that he failed to pay taxes for three years before his death. After he became operator of the jointly-owned wells, Frank Cass threatened to resign on a number of occasions. He did so because he was discouraged by the working interest owners’ failure to timely pay their monthly joint interest bills (“JIBs”). Mr. Cass related that he was being forced to put up his own money to pay vendors of the wells, and was losing money as the operator. In 1979, he sent a letter to all working interest owners stating that he was resigning as operator under the JOAs. The JOAs allowed an operator to resign, stating that all parties to the contract shall select by majority vote in interest a new operator. Nothing more was done or said about Mr. Cass’s resignation and he continued to operate the wells for another three years. In 1982, Mr. Cass sent a letter notifying the working-interest owners that he was changing the operator’s name from his own to Cass Oil Company, Inc. From that point forward, all the working interest owners made then-checks payable to Cass Oil Company, Inc., instead of Frank Cass. On November 14, 1988, Mr. Cass purchased certain undeveloped lease-hold acreage from General Stephens. These undrilled locations were on the same leases as the jointly-owned wells (“the Stephens wells”) and were direct offsets to them. The General passed away a few months after he executed those assignments. After the General died, his properties passed to Mrs. Stephens, the Walter H. Stephens Trust, the SSH Trust, the Sutton Elizabeth Stephens Irrevocable Trust, and the Heather Love Stephens Irrevocable Trust. In 1984, solely-owned Cass wells were drilled on the offset locations (“the Cass companion wells”). In March of 1986, Mr. Cass sent Mrs. Stephens a letter proposing to shut in twenty-six of the Stephens’ wells. Mrs. Stephens contacted Bob Franklin, an engineer who had appraised the wells for estate tax purposes following the General’s death. Based on Mr. Franklin’s advice, Mrs. Stephens wrote a letter asking Mr. Cass to show on a lease-by-lease basis how the leases would be held without production. In response, Mr. Cass called Mrs. Stephens and allegedly became very belligerent. Mrs. Stephens related that her conversation with Mr. Cass lasted for three hours, and that he was evasive and insulting. He told Mrs. Stephens that she did not know what she was talking about and neither did her engineer, her CPA, or her estate attorney. Concerned that Mr. Cass was withholding information, Mrs. Stephens hired Gray Petroleum Management Company (“gray”) to conduct an audit of the revenue and expenses of the jointly-owned wells (“the Gray audit”). She also hired a private investigator who recommended that she conduct a “trash cover” — a routine pick up of Cass Oil Company’s trash. The Gray audit resulted in separate reports for revenue and expenses. The audit was limited in scope and time; it covered revenue and expenses from 1984 to 1986. It reported major discrepancies, $2.9 million in expense exceptions and $9 million in revenue exceptions. Pretrial Matters Mrs. Stephens received the reports from Gray in September of 1986. She then mailed copies to other working interest owners who had a financial stake in the wells. Mrs. Stephens filed suit against the Casses on November 4,1986. Her petition alleged among other things that the Cass-es had breached the JOAs, converted jointly-owned property, and committed fraud. The Casses answered, denied the allegations, and counterclaimed against Mrs. Stephens for failure to pay her joint interest bills. The first 1,000 pages of the clerk’s record reflect a long and tortuous discovery battle. In July 1987, Stephens filed her first discovery request, seeking production of numerous documents. Over the ensuing months, a number of discovery hearings were held by the court and several orders were entered to compel discovery. Over the period from the actual commencement of discovery until May 1988, Cass produced and Stephens copied approximately 200,000 documents. In January 1988, Stephens filed a motion to compel further production and prevent destruction of documents. Also in January, Cass amended their answer asserting new and additional counterclaims against Stephens and against Gray, which was impleaded as a third-party defendant. Damages were sought against Stephens and against Gray, for negligently or intentionally conducting an improper audit and publishing a false report. In May 1988, a hearing was held on various motions for protective orders. There it was revealed for the first time that Stephens, through her investigators, had recovered between 150,000 to 200,000 documents from Cass Oil Company’s trash. The “trash cover” testimony indicated that Mr. Cass had been systematically discarding potentially discoverable documents both before and after the filing of the lawsuit. . Entire original files were thrown out, including the pump installation and well development files which were necessary to audit the joint interest accounts and to trace the movement of jointly-owned equipment. Mr. Cass even tore up and discarded the only signed copy of the original operating agreement. In June of 1988, Stephens moved for sanctions against the Cass defendants for their repeated discovery abuses. The trial court set a hearing for September 12, 1988. The Casses then filed a motion to exclude or suppress the trash documents. The hearing on the motion for sanctions and the motion to exclude or suppress evidence started on September 12, and lasted eight days. On -November 1, 1988, the trial court denied the Casses motion to exclude or suppress the trash documents. On November 7, 1988, the hearing on the motion for sanctions resumed and continued for four days during that month. The hearing resumed on April 3, 1989, and continued for eight days. Closing arguments were held on October 23,1989. The trial court rendered an order imposing sanctions against-the Casses on May 7, 1990. Among other things, the trial court’s order struck the Cass defendants’ answers, dismissed with prejudice the counterclaims, and entered a default judgment as to liability against them. All told, the hearing on the motion for sanctions lasted twenty-one days, involved more than eighty witnesses, and covers over 4,000 pages of reporter’s record. Appeal was taken to our Court. We dismissed for lack of jurisdiction holding that the trial court’s order was not a final judgment and not appealable. See Cass v. Stephens, 823 S.W.2d 731, 734 (Tex.App.-E1 Paso 1992, no writ). In dismissing the cause, we suggested that the trial court reconsider its decision under the Texas Supreme Court’s holdings in TransAmerican Natural Gas Corp. v. Powell, 811 S.W.2d 913 (Tex.1991) and Braden v. Downey, 811 S.W.2d 922 (Tex.1991). In November of 1993, pretrial matters were resumed. For the next thirteen months the parties continued the discovery process. In January of 1995, the Casses filed a number of motions for summary judgment based on limitations. In February, the Casses moved to disqualify Stephens’ expert witness, Harold Eldridge. Stephens responded to the motions. On August 28, 1995, a hearing was held on the motion to disqualify Stephens’ expert. The hearing lasted for two days. On September 5, 1995, the trial court denied the motion. In November of 1995, the Casses moved for summary judgment on approximately seven different issues in the case. Stephens responded to the motions. The trial court denied the motions for summary judgment on March 18, 1996. Trial was then set for February 10, 1997. The Cass-es’ attorney withdrew on November 5, 1996. The case was continued, and a new trial date was set for May 19, 1997. The Casses’ new counsel did not appear until May 5,1997. The Trial The case went to trial on May 27, 1997, and was tried over the course of the next five weeks, finally ending on June 26, 1997. Stephens put on evidence showing that Frank Cass was the operator of the wells and that Cass Oil Company, Inc., was never elected operator or, alternatively, was the alter ego of Frank Cass. Harold Eldridge, Stephens’ accounting expert, explained the evidence supporting the allegations against the Casses. -He testified that the documentary evidence showed Frank Cass: made unauthorized expense charges on the jointly-owned Stephens’ wells; overcharged expenses to the Stephens’ wells; repeatedly charged expenses incurred on the Cass companion wells to the Stephens’ wells; often made the joint owners of the Stephens’ wells pay for equipment they already owned; and finally converted jointly-owned equipment for use on the Cass companion wells without issuing any credit to the joint interest owners of the Stephens’ wells. Numerous witnesses established that Frank Cass had thrown away thousands of documents which were necessary to audit the expenses incurred on the Stephens’ wells, and to trace the movement of equipment from one well to another. Mr. Eldridge’s five volume report was admitted into evidence. The report summarized his testimony and shows on a per well basis his conclusions regarding the joint interest accounts. Stephens also admitted into evidence the report compiled by the Cass Defendants’ accounting expert, Mr. David McKinnon. Stephens showed that Mr. McKinnon agreed with some of Mr. Eldridge’s conclusions. In addition, hundreds of documents were admitted into evidence in support of Mr. Eldridge’s report. The documents consist of material transfer invoices, well development files, operating agreements, the Agreement to Terminate, and various other documents. The Cass Defendants put on evidence attempting to show that Cass Oil Company, Inc. was the operator of the wells. Counsel for the defendants repeatedly asserted that Mr. Eldridge’s conclusions were not trustworthy and were biased in favor of Stephens. The Cass Defendants stated that the testimony and conclusions of its own accounting expert, Mr. David McKinnon, were more reliable. Portions of McKinnon’s deposition were read into the record. The Cass Defendants also put on evidence showing that Stephens had not paid a portion of her 1986-87 joint interest billing and, thus, owed them money. Both Frank and Michael Cass maintained that Mr. Eldridge’s conclusion were incorrect, that they had done nothing wrong, and that both Gruy and Mrs. Stephens had slandered them. The Jury’s Verdict The jury considered the evidence and returned a verdict in favor of Stephens and against Frank and Michael Cass. Specifically, the jury found: that Frank Cass was the operator of the wells; that Cass Oil Company, Inc. was also the alter ego of Frank Cass; that Frank Cass had breached the operating agreements; that he had fraudulently concealed his breach; that Frank Cass committed common-law fraud by charging Stephens for goods and services that were never furnished to the Stephens’ wells; that Frank and Michael Cass converted jointly-owned property for their own personal benefit; that Stephens had not breached the operating agreements; and that she had not defamed the Cass defendants. The jury awarded Stephens: $317,905.59 as breach of contract damages accruing during the limitations period; $268,256.58 as breach of contract damages accruing outside the limitations period, but recoverable because of a fraudulent concealment finding; $68,136.69 as fraud damages accruing during the applicable limitations period; $33,164.23 as fraud accruing outside the limitations period, but recoverable because of a discovery rule finding; $14,070.38 as conversion damages accruing during the applicable limitations period; $84,710.44 as conversion damages outside the limitations period, but recoverable because of a discovery rule finding; $1,400,000 in attorney’s fees for preparation of the breach of contract claim; $100,000 for an appeal to this Court; $50,000 for an appeal to the Texas Supreme Court; and $25,000 if a writ of error is granted by the Texas Supreme Court. Exemplary Damages The jury heard additional testimony from Sutton and Patricia Stephens regarding the toll that the years of litigation had taken on them. The jury also heard from Frank, Michael, and Gregory Cass. Frank Cass asserted that he had exhausted his resources in defending the lawsuit and was strapped by debt. He specifically denied transferring any of his assets to his othet family members in order to become judgment proof. Michael Cass testified in much the same vein, maintaining that he had no money despite being president of a publicly traded petroleum corporation. The jury was charged and later returned with a verdict awarding damages to Stephens. The jury awarded Stephens $5 and $15 million against Frank Cass for committing common-law fraud and conversion, respectively. The jury then awarded Stephens $20 million against Michael Cass for his conversion of jointly-owned property. Post Trial Matters The Casses moved for judgment notwithstanding the verdict (“jnov”). The trial court denied the motion and entered judgment on the jury’s verdict. The trial court’s award included an additional $978,492.10 as a monetary sanction against Frank Cass for his discovery abuses. Frank and Michael Cass filed individual motions for new trial. The trial court overruled the motions by written order. Stephens voluntarily remitted $15 million of the awards against Frank Cass — $2.5 million of the fraud award and $12.5 million of the conversion award. Stephens also voluntarily remitted $17.5 million of the award against Michael Cass. Frank and Michael Cass timely filed' separate notices of appeal and have filed separate briefs. SUMMARY OF THE ISSUES Frank Cass raises six points of error: (1) there was insufficient evidence that he was personally liable for breach of contract, fraud, and conversion; (2) the evidence was insufficient to allow Stephens to recover outside the limitations period under the JO As or, alternatively, the discovery and fraudulent concealment rules should not apply to toll the running of the appropriate limitation periods under each cause of action; (3) there is insufficient evidence to support the jury’s award of exemplary damages; (4) there is insufficient evidence to support the award of compensatory damages; (5) there is insufficient evidence to support the jury’s award of attorney’s fees; and (6) the trial court erred in determining that sanctions should be imposed. Michael Cass raises five points of error: (1) the failure to properly account for property moved between wells cannot as a matter of law constitute conversion; (2) there is insufficient evidence that he personally converted jointly-owned property; (3) there is insufficient evidence of the amount of damages resulting from his alleged conversion; (4) the discovery rule is inapplicable as a matter of law; and (5) the exemplary damages are unfounded and unjust. EXPERT TESTIMONY We first address Eldridge’s qualifications as an expert witness. This is a threshold issue because Eldridge’s testimony provides crucial evidence to support many of the jury’s findings. Although Frank and Michael have not attacked El-dridge’s qualifications by separate point of error, they have included attacks on his qualifications as component parts of their challenges to the jury’s findings of liability and its award of actual and exemplary damages. We will therefore resolve the issue of Eldridge’s competence, first, and address the more specific challenges to his testimony where appropriate. The admissibility of expert testimony is governed by Rule 702 of the Texas Rules of Evidence. See Tex.R.Evid. 702. The qualification of a witness as an expert is within the trial court’s discretion. Broders v. Heise, 924 S.W.2d 148, 151 (Tex.1996). Rule 702 contains three requirements for the admission of expert testimony: the witness must be qualified; the proposed testimony must be scientific, technical, or other specialized knowledge; and the testimony must assist the trier of fact to understand the evidence or to determine a fact issue. See Tex.R.Evid. 702; E.I. du Pont de Nemours & Co., Inc. v. Robinson, 923 S.W.2d 549, 556 (Tex.1995). The party offering the expert’s testimony bears the burden to prove that the witness is qualified under Rule 702. See Gammill v. Jack Williams Chevrolet, Inc., 972 S.W.2d 713, 718 (Tex.1998). The offering party must demonstrate that the witness possesses special knowledge as to the very matter on which he proposes to give an opinion. Id. The test for abuse of discretion is whether the trial court acted without reference to any guiding rules or principles. Robinson, 923 S.W.2d at 558; In re M.D.S., 1 S.W.3d 190, 203 (Tex.App.Amarillo 1999, no pet.). Eldridge testified that he grew up around the oil and gas business, assisting his father in his used oil field equipment business through high school and college. In 1966, he graduated from McMurray College with a B.B.A. with emphasis in accounting. He became a certified public accountant (“CPA”) in March of 1968. After college, he worked for Arthur Anderson & Company in Dallas, Texas, with clients engaged in the oil and gas, cement, manufacturing, and processing industries. He then became Vice President of Finance and Controller of Harding Brothers Oil Company, a company engaged in drilling, completing, and operating oil and gas wells. Eldridge related that he was responsible for all accounting functions, including billing on joint interest accounts. He was also responsible for accounting for new and used equipment of a Harding affiliate company called Pipe & Supply, Inc. After Harding, Eldridge worked for at least five other oil and gas companies. His duties routinely required him to handle accounting functions, joint interest billings, and tax matters. Next, Eldridge became managing partner and tax partner in charge of Coopers & Lyb-rand, Midland, Texas. There, he was responsible for the firm’s due diligence activities. Since 1991, Mr. Eldridge has been a solo practitioner and consultant. In 1992, he also served as Bankruptcy Trastee for an oil and gas company that operated about 550 oil and gas wells. Eldridge explained that he has performed joint interest audits of oil and gas operators for over twenty years. He spent approximately ten years with companies that operated hundreds of oil and gas wells. He related that he has extensive knowledge regarding operating agreements, title opinions, division of interest, joint interest billings, revenue distribution, accounting, billing, and collection. He is a member of the Council of Petroleum Accountants Society (“COPAS”) and has served on the tax committee and the audit committee for the Permian Basin chapter. COPAS is the recognized authority for the petroleum accounting industry and is responsible for promulgating accounting procedures which are attached to virtually every operating agreement. Eldridge is also a member of The American Institute of Certified Public Accountants (“AIC-PA”), and the Texas Society of Certified Public Accountants. Eldridge was offered as an expert in petroleum accounting. Clearly, he possessed the requisite knowledge, skill, experience, training, and education regarding that specific issue. He was therefore qualified to give an expert opinion as to whether the Cass Defendants complied with the proper accounting procedures under the operating agreements. The proposed testimony was scientific, technical, and specialized. The testimony of a petroleum accountant would have clearly assisted the trier of fact to understand the evidence presented in this case, and would have helped the jury to determine the fact issues posed by the parties. We therefore conclude that the trial court did not abuse its discretion by admitting the testimony. The Casses complain, however, that “El-dridge employed his own, self-invented, untested, and non-industry approved accounting method rather than the widely used and industry approved COPAS accounting procedure.... ” Specifically, the Casses refer to Eldridge’s use of a “Contract Compliance Verification Procedures.” The Casses assert that this method of accounting is not recognized by any authority, is undefined, untested, and incapable of peer review because only Eldridge knows what the procedures entail. Their claim is founded on Eldridge’s report wherein he stated that he called his auditing procedures “Contract Compliance Verification Procedures.” This complaint is not new, the Casses presented this claim to the trial court in their motion to disqualify Eldridge. The trial court held a two day hearing on the matter and overruled the Casses’ motion. The Casses reasserted their motion before Eldridge began testifying. The trial court overruled their objection. On direct examination during trial, Eldridge explained that the term “Contract Compliance Verification Procedures” was taken from CO-PAS Bulletin Number 3, Paragraph B which states that an expenditure audit of a joint account serves two main purposes: verifying and authenticating account charges and assuring compliance with the operating agreements. Throughout the litigation of this case, whether it was during his deposition, the hearing on the motion to disqualify, or during the trial, El-dridge did not waiver in his testimony that he followed accepted accounting methods and standards. Specifically, he relied on COPAS Bulletin Numbers 3, 5, 8, 16, 23, and 26, various pronouncements of AIC-PA, and the Rules of the Texas State Board of Public Accounting. These bulletins and pronouncements are all recognized- as authoritative and controlling in auditing joint interest accounts. We conclude that the trial court did not err by admitting Eldridge’s testimony. Accordingly, we overrule Frank and Michael’s general complaints that the trial court abused its discretion by admitting El-dridge’s testimony under Rule 702. STANDARDS OF REVIEW Because we will address numerous challenges to the sufficiency of the evidence, we first summarize the applicable standards of review. Legal Sufficiency “Legal sufficiency points of error assert a complete lack of evidence on an issue, and are designated as ‘no evidence’ points or ‘matter of law’ points, depending upon whether the complaining party had the burden of proof.” W. Wendell Hall, Standards of Review in Texas, 29 St. Mary’s L.J. 476-77 (1998). When an appellant attacks the legal sufficiency of an adverse finding on an issue on which he did not have the burden of proof at trial, the appellant must demonstrate on appeal that there is “no evidence” to support the adverse finding. Robert W. Calvert, “No Evidence” and “Insufficient Evidence” Points of Error, 38 Tex.L.Rev. 361, 364-68 (1960). The traditional statement of the “no evidence” standard of review is that the reviewing court considers only the evidence and inferences that tend to support the findings and disregards all evidence and inferences to the contrary. See Garza v. Alviar, 395 S.W.2d 821, 823 (Tex.1965); Merrell Dow Pharmaceuticals, Inc. v. Havner, 953 S.W.2d 706, 711 (Tex.1997). A no evidence point will be sustained only when the record discloses: (1) there is a complete absence of evidence of a vital fact; (2) the court is barred by rules of law or of evidence from giving weight to the only evidence offered to prove a vital fact; (3) the evidence offered to prove a vital fact is no more than a mere scintilla; or (4) the evidence conclusively establishes the opposite of the vital fact. 38 Tex.L.Rev. at 362-63. More than a scintilla of evidence exists when the evidence supporting the finding, as a whole, “ ‘rises to a level that would enable reasonable and fair-minded people to differ in their conclusions.’” Havner, 953 S.W.2d at 711. When an appellant attacks the legal sufficiency of an adverse finding on an issue on which he had the burden of proof at trial, he must demonstrate on appeal that all vital facts in support of the issue were conclusively established by the evidence, or as a “matter of law.” Sterner v. Marathon Oil Co., 767 S.W.2d 686, 690 (Tex.1989); Kratz v. Exxon Corp., 890 S.W.2d 899, 902 (Tex.App.-El Paso 1994, no wilt). In reviewing a “matter of law” challenge, the reviewing court engages in a two-step analysis. First, the record must be examined for evidence that supports the jury’s finding, while ignoring all evidence to the contrary. Second, if there is no evidence to support the fact finder’s answer, then, the entire record must be examined to see if the contrary proposition is established as a matter of law. See Victoria Bank & Trust Co. v. Brady, 811 S.W.2d 931, 940 (Tex.1991). Factual Sufficiency “Insufficient evidence” or factual insufficiency involves a finding that is so against the great weight and preponderance of the evidence as to be manifestly wrong. When the party having the burden of proof complains of an unfavorable finding, the point of error should allege that the findings “are against the great weight and preponderance of the evidence.” The “insufficient evidence” point of error is appropriate only when the party without the burden of proof on an issue complains of the court’s findings. See Kimsey v. Kimsey, 965 S.W.2d 690, 700 (Tex.App.-El Paso 1998, pet. denied). The test for factual insufficiency points is set forth in In re King’s Estate, 150 Tex. 662, 244 S.W.2d 660 (1951). In reviewing an insufficiency of the evidence challenge, we must consider all of the evidence, both the evidence which tends to prove the existence of a vital fact as well as evidence which tends to disprove its existence. Id. After having done so, we will only set aside the finding if the evidence which supports the jury finding is so weak as to be clearly wrong and manifestly unjust. See 29 St. Mary’s L.J. at 483-86. In reviewing a challenge that the jury finding is against the great weight and preponderance of the evidence, we must first examine the record to determine if there is some evidence to support the finding. If such.is the case, then we must determine, in light of the entire record, whether the finding is so contrary to the overwhelming weight and preponderance of the evidence as to be clearly wrong or manifestly unjust, or whether the great weight and preponderance supports its nonexistence. See 29 St. Mary’s L.J. at 483-86. In assessing a factual insufficiency point of error, we are guided by the rule that the reviewing court cannot substitute its conclusions for those of the fact finder. In re B.R., 950 S.W.2d 113, 121 (Tex.App.-El Paso 1997, no pet.). If sufficient competent evidence of probative force exists to support the finding, it must be sustained. Id. We may not interfere with the fact finder’s resolution of conflicts in the evidence or pass on the weight or credibility of the witnesses’ testimony. Benoit v. Wilson, 150 Tex. 273, 239 S.W.2d 792, 796 (1951); Transportation Ins. Co. v. Moriel, 879 S.W.2d 10, 30 (Tex.1994). Where conflicting evidence is present, the fact finder’s determination on such matters is generally regarded as conclusive. Kimsey, 965 S.W.2d at 700; In re B.R., 950 S.W.2d at 121. We note that the record is incomplete. The reporter’s record shows that numerous exhibits were admitted into evidence. Only a portion of those exhibits are in the record here. It is observed that the Appellants have not properly designated a partial reporter’s record pursuant to Tex.R.App.P. 34.6(c). At oral argument, we requested that the parties supplement the record with the exhibits they thought were necessary for our review. We have not received any supplementary exhibits. In order to obtain a reversal, the appellant has the burden to come forward with a record showing error which warrants reversal. See Murray v. Devco, Ltd., 731 S.W.2d 555, 557 (Tex.1987). Because we have been asked to review a number of sufficiency challenges, the fact that we do not have a full record will impact our analysis of some issues. Under a legal sufficiency standard, we must be able to ascertain all of the evidence which supports the judgment in order to determine whether there is more than a scintilla of evidence to support the jury’s verdict. Under a factual sufficiency standard, we must have all of the evidence in order to weigh the competing groups and determine whether the jury’s verdict is clearly wrong or manifestly unjust. Generally, we presume that omitted evidence supports the findings of the jury and the judgment of the trial court. Murray, 731 S.W.2d at 557. PERSONAL LIABILITY In his first point of error, Frank Cass asserts that the evidence is legally and factually insufficient to support the jury’s findings that he was personally liable for the actions of Cass Oil Company, Inc. We focus on two findings by the jury: (1) that Frank Cass remained operator under JOAs; and (2) that Cass Oil Company, Inc. is the alter ego of Frank Cass. Operator Finding In question number one, the jury was instructed that Frank Cass became operator of the properties on January 1, 1978, by a majority-in-interest vote. The jury was then instructed that an operator may resign from his duties at any time upon written notice, and that all parties to the agreement shall then select a new operator by majority-in-interest vote. The jury was further instructed that Frank did not remain operator if a majority-in-interest waived the requirement for an affirmative vote by consenting to the substitution of Cass Oil Company, Inc. as operator. Waiver was defined as an intentional surrender of a known right or intentional conduct inconsistent with claiming the right. On appeal, Frank argues that there is “no evidence” or “insufficient evidence” to support the jury’s finding that he remained operator. He asserts that Stephens had notice of the change in operators and did not object. He relies on his own testimony that General Stephens consented to the change in operators. He also relies on evidence showing that Stephens made payments to Cass Oil Company, Inc., and that the Railroad Commission recognized Cass Oil Company, Inc., as the operator of the wells. Considering his legal sufficiency challenge, first, we observe that Frank essentially argues that he established waiver as a matter of law. Waiver is an affirmative defense; Frank bore the burden for establishing this defense. See Tex.R.Civ.P. 94. To succeed on appeal, he must demonstrate that all vital facts in support of the issue were conclusively established by the evidence. See Sterner, 767 S.W.2d at 690; Kratz, 890 S.W.2d at 902. In applying the first step of our two-step analysis, we first consider whether there is any probative evidence to support the jury’s finding. Kratz, 890 S.W.2d at 902. Here, Frank admitted that he did not follow through with his 1979 resignation letter, and remained operator for the next three years. The parties stipulated that none of the JOAs identified Cass Oil Company, Inc., as operator. The only document which purports to change the operator name is the 1982 letter on Cass Oil Company, Inc. letterhead which notified the joint interest owners that the operator, Frank Cass, was changing his name to Cass Oil Company, Inc. Mr. Eldridge testified that operators often change their names without changing the entity itself. Mrs. Stephens said that Frank did not need her permission to change his name. Mrs. Stephens and another interest owner, Bert Nelson, testified that they always looked to Frank as the operator of the wells. It is undisputed that Cass Oil Company, Inc. was never elected operator, did not solicit any votes to become operator, and that Mr. Cass knew and understood the procedure for changing operators. We conclude that there is legally sufficient evidence to support the jury’s finding that Frank remained operator. There clearly was a conflict in the evidence about which reasonable minds could disagree. The jury was instructed on waiver, heard Mr. Cass’s theory of the evidence, and impliedly rejected his argument. Waiver is inherently a jury question. See Huffington v. Upchurch, 532 S.W.2d 576, 580 (Tex.1976). Finding evidence to support the finding, we dispense with the second step of our two-part analysis. Frank’s legal sufficiency challenge is overruled. We next consider whether the evidence is factually sufficient to support the jury’s finding. Because Frank had the burden of proof to establish his waiver defense, we consider whether the jury’s findings are so contrary to the overwhelming weight and preponderance of the evidence as to be clearly wrong or manifestly unjust. As stated above, there was some evidence which supports the jury’s finding, thus, we concentrate on the evidence which conflicts with the jury’s finding. Frank relies primarily upon the 1979 resignation letter, the 1982 change-of-name letter, the fact that no one objected to the change in name of the operator, the fact that all of the joint interest owners made payment to Cass Oil Company, Inc., and the fact that the Texas Railroad Commission recognized Cass Oil Company, Inc. as the operator of the wells. This evidence is significant, however, it is not conclusive on the' issue of waiver. Frank’s ■ purported resignation is controverted by the fact that he remained the operator for three years after his alleged resignation. The operating agreements were never amended to show the election of a new operator. The JOAs are the basis for the parties legal rights, duties, and liabilities. The fact that no one objected to the change in the operator’s name does not prove that the operator in fact changed from Frank Cass to Cass- Oil Company, Inc. In addition, the fact that the Railroad Commission recognized Cass Oil Company, Inc. as the operator does not conclusively establish the matter as between the parties to the JOAs. Here, the question of waiver centers on the intent and actions of the parties. The parties made a contract and provided that there was a specific and technical way to elect a new operator. Frank’s evidence permits an inference that Stephens and the other joint interest owners may have waived their objections to the substitution of Cass Oil Company, Inc., as the operator, but it is not the only reasonable inference to be drawn from the evidence. ■ The issue of waiver required the jury to weigh the testimony of Frank Cass against that of Mrs. Stephens, Bert Nelson, and Mr. El-dridge. It required that the jury resolve a clear conflict in the evidence. We conclude the jury’s finding that Frank Cass remained operator, and its implied finding that Cass Oil Company, Inc., failed to become operator by waiver is not so contrary to the overwhelming weight and preponderance of the evidence as to be clearly wrong or manifestly unjust. Accordingly, Frank, Cass’s factual sufficiency challenge is overruled. Alter Ego Finding Here, Frank contends that there is no evidence or insufficient evidence to support the finding. Specifically, he argues that there is no evidence or insufficient evidence that he used Cass Oil Company, Inc., to commit an actual fraud for his own direct personal benefit. Under the alter ego theory, courts disregard the corporate entity when there exists such unity between corporation and individual that the corporation ceases to be separate and when holding only the corporation liable would promote injustice. Mancorp, Inc. v. Culpepper, 802 S.W.2d 226, 228 (Tex.1990), citing Castleberry v. Branscum, 721 S.W.2d 270, 272 (Tex.1986). An alter ego relationship may be shown from the total dealings of the corporation and the individual. Id. at 272. This showing may include evidence of “the degree to which corporate formalities have been followed and corporate and individual property have been kept separately, the amount of financial interest, ownership and control the individual maintains over the corporation, and whether the corporation has been used for personal purposes.” Id. In order to hold a shareholder liable for a corporation’s actions, Article 2.21 of the Texas Business Corporations Act requires a plaintiff to prove that the shareholder caused the corporation to be used for the purpose of perpetrating and did perpetrate an actual fraud on the plaintiff primarily for the direct benefit of the shareholder. See Tex.Rev.Civ.Stat.Ann. art. 2.21(A)(2)(Vernon Supp.2001); see also, Menetti v. Chavers, 974 S.W.2d 168, 173-75 (Tex.App.-San Antonio 1998, no pet.). Frank first complains that there is no finding that he used Cass Oil Company, Inc., to commit an actual fraud on Stephens. He asserts that the jury’s finding must be overturned because Article 2.21 requires a specific finding of actual fraud in connection with an alter ego finding. We agree that Article 2.21 requires a finding of actual fraud, but we disagree with his contention that there is no such finding in this case. The jury was instructed that it could not find Cass Oil Company, Inc. was the alter ego of Frank unless it also found that Frank caused Cass Oil Company, Inc. to be used to perpetuate an actual fraud on Stephens. Thus, the jury impliedly found that Frank used the corporation to commit an actual fraud on Stephens when it found that the corporation was his alter ego. Frank made no objection to submitting the charge in this form and has not asserted on appeal that there is any error in the trial court’s charge to the jury. Instead, he has chosen to attack the sufficiency of the evidence to support the alter ego finding. Additionally, we note that the jury specifically found that he committed common-law fraud by misrepresentation in question number thirteen of the jury charge. As a consequence, his complaint that there is no finding of actual fraud is overruled. We now turn to Frank’s legal sufficiency challenge to the implied finding of actual fraud. Stephens had the burden of proving that Frank caused Cass Oil Company, Inc. to perpetrate an actual fraud on her for his own direct benefit. Actual fraud by misrepresentation consists of a representation that is: (1) material; (2) false; (3) knowingly false or made with reckless disregard for its truth or falsity; (4) made with the intention that it be acted upon by the other party; (5) relied upon by the other party; and (6) damaging to the other party. Menetti, 974 S.W.2d at 175. Stephens put on evidence showing that the Stephens’ wells were billed for numerous goods and services provided solely to the Cass companion wells. Mr. Eldridge testified that Cass Oil Company billed the Stephens’ wells for ad valorem tax services, salt water hauling services, electricity, and road work, which were incurred by Cass companion wells. Moreover, Eldridge explained that numerous delivery tickets and vendor’s invoices were modified by Frank in order to divert expenses from the Cass companion wells to the Stephens’ wells. The jury was shown exhibits which apparently showed that Frank modified the tickets and invoices, and approved the charges, often with his own handwriting. Those documents, Plaintiffs Exhibits 1202 A through 1202 TTT, are not a part of the record on appeal, but were admitted into evidence. Mr. Eldridge’s report also contains evidence that Stephens was charged operating expenses for wells that were inactive. From this evidence, a jury could rationally find that Frank used Cass Oil Company, Inc. to perpetuate a fraud on Stephens. The evidence shows that he charged expenses incurred on the Cass companion wells to the Stephens’ wells. These charges showed up on the joint interest bills as apparently legitimate charges for operating expenses. The charges were material representations that Stephens owed money for expenses which she in fact had not incurred. A rational jury could have found that Frank knowingly submitted the false bills from the fact that he personally altered and signed many of the tickets and invoices which misallocated the operating expenses. It is also reasonable to infer that the bills were made with the intent that Stephens rely upon them. There is evidence that she in fact paid the bills to her detriment. Viewed in the light most favorable, we conclude that there is legally sufficient evidence to support the jury’s implied finding. Accordingly, we overrule Frank’s legal sufficiency challenge. We now consider whether the evidence is factually sufficient to support the jury’s implied finding, and turn to the evidence which conflicts with the jury’s determination. Frank urges that we consider the fact that he owned an equal if not greater interest in the Stephens’ wells than Appel-lees. He points out that if the Stephens’ wells were improperly charged, then he was improperly charged as well. He also relies on Eldridge’s statement that he could not find any evidence that Frank personally received any money from the affiliate companies that overcharged the Stephens’ wells for goods and services. Frank argues that there is no proof that any of the overcharges benefited him personally. We are unpersuaded by this argument. Assuming he paid the charges, he is no doubt correct in asserting that he still had to pay a proportional share of the misapplied charges. But that does not end our analysis. The evidence clearly shows that Frank generally owned an interest of 43.7 percent to 50 percent in the Cass companion wells, with his own family members owning the rest. By contrast, Frank Cass generally owned smaller interests in the Stephens’ wells — anywhere from a low of 12 percent to a high of 50 percent — with the remaining interest owned by Stephens and various other persons. Allocating charges to an account in which an individual owns a smaller interest benefits him economically. If he bills $100 to an account that he owns a 100 percent share in, he pays $100. If he bills $100 to an account that he owns a 50 percent share in, he pays $50. If he misallocates a bill of $100 to an account that he owns a 20 percent share in, rather than an account that he owns a 50 percent interest in, then he pays $20 rather than $50. The jury could properly infer that Frank personally benefited from the misallocation of expenses to the Stephens’ wells. The jury was also at liberty to consider the benefit which inured to Frank when his family received free goods and services at the expense of others. Having assayed all the evidence, we conclude that the evidence that supports the jury’s verdict is not so weak as to be clearly wrong and manifestly unjust. Frank’s factual sufficiency complaint is overruled. In summary, we conclude that there is both legally and factually sufficient evidence to support the jury’s findings that Frank remained the operator under the JOAs, and that Cass Oil Company, Inc. was his alter ego. Frank’s first point of error is overruled. FRAUD In his fourth point of error, Frank complains that there is legally and factually insufficient evidence to support the jury’s findings that he committed fraud and conversion. As noted, the jury found that Frank Cass had committed common-law fraud by misrepresentation in question number thirteen of the jury charge. In light of our analysis above, we overrule Frank’s sufficiency challenge to the fraud finding. CONVERSION We now consider Frank and Michael’s attack on the jury’s conversion findings. Conversion is the unauthorized and unlawful assumption and exercise of dominion and control over the personal property of another which is to the exclusion of, or inconsistent with, the owner’s rights. Waisath v. Lack’s Stores, Inc., 474 S.W.2d 444, 446 (Tex.1971); Whitaker v. Bank of El Paso, 850 S.W.2d 757, 760 (Tex.App.-El Paso 1998, no writ). Plaintiff must prove that at the time of the conversion, he was the owner of the property, had legal possession of it, or was entitled to possession. Whitaker, 850 S.W.2d at 760. Here, the JOAs created a co-tenancy relationship. Rankin v. Naftalis, 557 S.W.2d 940, 946 (Tex.1977); Hamilton v. Texas Oil & Gas Corp. 648 S.W.2d 316, 321 (Tex.App.-El Paso 1982, writ refd n.r.e.); Donnan v. Atlantic Richfield, 732 S.W.2d 715, 717 (Tex.App.-Corpus Christi 1987, writ denied). Each working interest owner held an undivided interest in the property. A cotenant has the right to be in possession of the property in which he owns an interest. Todd v. Bruner, 365 S.W.2d 155, 160 (Tex.1963); Tynes v. Mauro, 860 S.W.2d 168, 176 (Tex.App.-El Paso 1993, writ denied). The operator was given full control of all operations, but each working interest owner had the right to enter the common estate. A cotenant may maintain a conversion suit against another cotenant who has appropriated the entire commonly owned property for his own use and benefit. Grabes v. Fawcett, 307 S.W.2d 311, 315 (Tex.Civ.App.-Texarkana 1957, no writ). If possession is initially lawful, demand and refusal to return the property may be required for the cause of action to accrue. See Hofland v. Elgin-Butler Brick Co., 834 S.W.2d 409, 413 (Tex.App.Corpus Christi 1992, no writ); Young v. J & J Bail Bonds Co., 792 S.W.2d 484, 485 (Tex.App.-El Paso 1990, no writ). Demand and refusal are not necessary, however, when the possessor’s acts manifest a clear repudiation of the plaintiffs rights. Whitaker, 850 S.W.2d at 760; Hofland, 834 S.W.2d at 414. The record contains evidence that jointly-owned equipment was transferred from Stephens’ wells to Cass companion wells. Eldridge’s report contains a section related to material transfers. His five volume report goes into detail on a well-by-well basis and summarizes the transfers of jointly-owned equipment to the Cass companion wells. Eldridge testified that he was able to reconstruct the movement of the jointly-owned equipment by using the trash documents. Exhibits 704, 704A, 706, and 708 are handwritten notes by Cass employees concerning the material transfers. Exhibits 707, 707A, and 707B, are Frank’s own handwritten notes concerning the material transfers. Using these handwritten notes, and various developments files thrown away by Frank, Eldridge discovered that the Casses transferred jointly-owned equipment to the companion wells without giving credit to the Stephens’ wells. The Casses later sold their interests in the companion wells to a third party for $12 million. One of the examples given to the jury was the equipment transfers regarding the Ganze 7-1 well. Exhibit 708 shows that a pump jack was moved to the Ganze 7-1, a Stephens’ well, in November 1975, and the joint account was billed $14,850. In February 1980, the pump jack was moved to the Driver 34-2, another Stephens’ well. The joint account was again billed another $14,850 for the pump plus $1,200 for a concrete base, and no credit was issued to the Ganze well. Later, the pump jack was moved to the Smith 1, a Cass companion well, and no credit was issued to the Driver. The net effect of these transfers is that Stephens paid twice for a pump jack, that was then moved to a Cass companion well, and was later sold to a third party, without any credit being issued for the transfers. First, Frank and Michael both assert that there is legally and factually insufficient evidence to support a conversion finding because there is no proof that their exercise of dominion and control over the property was unauthorized or unlawful. Specifically, they argue that the COPAS accounting procedures attached to the JOAs authorized the operator to move jointly-owned equipment between the wells, and also authorized the operator to purchase or take equipment in kind. They contend that their failure to properly account for the movement of equipment was a breach of contract, not conversion. We disagree. We find compelling evidence which supports the jury’s findings. The evidence shows that Frank and Michael moved jointly-owned equipment to their solely owned wells without giving credit to the joint accounts. The evidence also shows a pattern of abuses by the Casses: making the joint interest owners pay multiple times for the same property; discontinuing their procedures for documenting material transfers thereby making it harder to trace the property movements transfers; the destruction of documents which show the equipment transfers; failing to give the Gruy auditors the documents necessary for tracing the equipment transfers; and finally the sale of the jointly-owned property to a third party. From this evidence, the jury reasonably could infer that the accounting errors were not just fortuitous or by accident, but were intentionally done so that the Casses would benefit at the expense of others. The evidence clearly supports the findings that Frank and Michael unlawfully appropriated the jointly-owned equipment for their own use and benefit. While accounting procedures authorize the operator to purchase jointly-owned equipment, the context here is that the Casses removed large amounts of jointly-owned equipment to their solely owned wells without paying for the equipment. The facts also show a pattern of deception concerning the movements of the equipment and an attempt to hide the transfers. These facts may prove a breach of the operating agreements, but they also support a claim for conversion. Considering the evidence, the jury was free to infer that the prolonged retention of the equipment without payment was an act of conversion and not merely a breach of contract. We conclude that there is legally and factually sufficient evidence to support the jury’s findings. Second, Michael Cass claims that there is insufficient evidence that he personally converted any equipment. He asserts that the evidence does not support a finding that he used the property for his own personal benefit. Essentially, he claims ignorance of the accounting errors made by his father. He argues that he should not be responsible for his father’s wrongful acts. A corporate officer or agent is always primarily liable for his own torts, even though the principal is also vicariously liable. Permian Petroleum Co. v. Barrow, 484 S.W.2d 631, 634 (Tex.Civ.App.-El Paso 1972, no writ); Portlock v. Perry, 852 S.W.2d 578, 582 (Tex.App.-Dallas 1993, writ denied). An employee may be held individually liable for an employer’s tor-tious acts if he knowingly participates in the conduct or has knowledge of the tor-tious conduct, either actual or constructive. Portlock, 852 S.W.2d at 582. Instigating, aiding, or abetting the wrongdoing constitutes participation. Permian Petroleum Co., 484 S.W.2d at 634. The employee or agent may be held liable regardless of whether he receives any personal benefit from the tortious act. Gardner Machinery Covp. v. U.C. Leasing, Inc., 561 S.W.2d 897, 899 (Tex.Civ.App.-Beaumont 1978, writ dism’d). The evidence shows that during the period from 1977 to 1978, Michael Cass had responsibility for most aspects of drilling and field operations. He then moved back to Dallas and helped his father run the business. The record contains material transfer orders with Michael Cass’s initials approving equipment transfers. Eldridge testified that Michael Cass’s initialed and approved many of the transfers of equipment from the Stephens’ wells to the Cass companion wells. From this evidence, the jury reasonably could infer that Michael Cass had knowledge of the transfers, that he participated in the conversions, and that he personally benefited from the transfers. We conclude that there is both legally and factually sufficient evidence to support the findings of liability against Michael. Third, Frank and Michael complain that the evidence is insufficient to support the jury’s award of damages. The measure of damages for conversion is the value of the property at the time and place of the conversion. Prewitt v. Branham, 643 S.W.2d 122, 123 (Tex.1982)(per curiam); Edlund v. Bounds, 842 S.W.2d 719, 727 (Tex.App.-Dallas 1992, writ denied). The Casses argue that there is no competent evidence proving the market value of the converted property. Specifically, they contend: that Eldridge was not qualified to state an opinion as to the market value of the equipment; that he did not supply any information concerning the market value of the equipment; and that his damage calculations were based on erroneous facts. The record reflects that the Casses have not preserved their complaints for our review. Although Michael and his father filed a motion to exclude Eldridge’s testimony, the motion did not raise the three issues now asserted. To preserve a complaint that scientific evidence is unreliable and thus, no evidence, a party must object to the evidence before trial or when the evidence is offered. Maritime Overseas Corp. v. Ellis, 971 S.W.2d 402, 409 (Tex.1998). Without requiring a timely objection to the reliability of the scientific evidence, the offering party is not given an opportunity to cure any defect that may exist, and will be subject to trial and appeal by ambush. Id. During the second day of trial, the trial court warned the Cass Defendants that he could not rule on general complaints lodged against Eldridge’s testimony. The trial court told them to object to the specific testimony they believed was unreliable. We also observe that the evidence concerning the market value of the equipment was presented over a number of days and El-dridge’s entire report was admitted into evidence. If in fact there was an objection remotely close to the contentions raised here, it no doubt has been waived because the same evidence was presented elsewhere in the record without objection. Richardson v. Green, 677 S.W.2d 497, 501 (Tex.1984). Assuming, arguendo, that the complaints had been preserved, the record contains evidence showing that Eldridge was qualified to give an opinion as to the market value of the equipment. For over twenty years, Eldridge has been closely associated with the financial operations of numerous oil and gas businesses. He has handled tax matters, accounting matters, and matters related to the drilling, completion, and operation of oil and gas wells. Specifically, he has accounted for both new and used equipment during his extensive career. Eldridge stated that he relied on the COPAS bulletins, the recognized authorities for oil and gas accounting, .in determining the equipment values. Clearly, Eldridge was qualified to state an opinion regarding the market value of the converted equipment. In summary, we conclude there is both legally and factually sufficient evidence to support the jury’s findings of conversion against Frank and Michael. There is also evidence to support the jury’s award of damages. Accordingly, we overrule those portions of Frank’s fourth point of error which challenge the sufficiency of the evidence to support the conversion finding and the award of damages; we also overrule Michael’s first, second, and third points of error. LIMITATIONS The next issue for consideration regards the jury’s fraudulent concealment and discovery rule findings. Fraudulent concealment is an affirmative defense to the statute of limitations. Weaver v. Witt, 561 S.W.2d 792, 793 (Tex.1977). It is based upon the doctrine of equitable estoppel. In the proper case, invocation of fraudulent concealment es-tops a defendant from relying on the statute of limitations as an affirmative defense to plaintiffs claim. Where a defendant is under a duty to make disclosure but fraudulently conceals the existence of a cause of action from the party to whom it belongs, the defendant is estopped from relying on the defense of limitations until the party learns of the right of action or should have learned thereof through the exercise of reasonable diligence. See Borderlon v. Peck, 661 S.W.2d 907, 909 (Tex.1983); see also, Computer Associates International Inc. v. Altai, Inc., 918 S.W.2d 453, 455-56 (Tex.1996). The plaintiff has the burden of coming forward with proof to support the allegation. Weaver, 561 S.W.2d at 793. In summary, the pla