law-lost-profits-damages
LOST PROFIT DAMAGES CASE LAW FROM HOUSTON
Lost profits are damages for the loss of net income to a business and, broadly speaking, reflect
income from lost business activity, less expenses that would have been attributable to that activity.
Miga v. Jensen, 96 S.W.3d 207, 213 (Tex. 2002); see generally Capital Metro. Transp. Auth. v. Cent.
of Tenn. Ry. & Navigation Co., 114 S.W.3d 573, 581-82 & n. 7 (Tex.App.-Austin 2003, pet. denied)
(considering both income projections and specific expenses when evaluating proof of lost profits).
Lost profits may be recovered for money that would have been made if the bargain had been
performed as promised. Formosa Plastics Corp. v. Presidio Eng'rs & Contractors, Inc., 960 S.W.2d
41, 50 (Tex.1998). To be recovered, lost profits must be proved with reasonable certainty and
competent evidence. Szczepanik v. First S. Trust Co., 883 S.W.2d 648, 649 (Tex.1994).
Lost profits are recoverable only if the evidence shows that the loss of profits was a material and
probable consequence of the breach complained of and the amount due is shown with sufficient
certainty. Cmty. Dev. Serv., Inc. v. Replacement Parts Mfg., 679 S.W.2d 721, 725 (Tex.App.-Houston
[1st Dist.] 1984, no writ). Generally, lost profits are properly calculated by deducting from the actual
contract price the costs of the injured party's performance supported by data. Id. "However, a witness
may also prove lost profits by testifying as to what his profit would have been, based on his
knowledge of the cost of performance of each element of the contract and subtracting the total of
such costs from the contract price." Id.
"The requirement of `reasonable certainty' in the proof of lost profits is intended to be flexible enough
to accommodate the myriad circumstances in which claims for lost profits arise." SW Battery Corp. v.
Owen, 131 Tex. 423, 115 S.W.2d 1097, 1099 (1938). "What constitutes reasonably certain evidence
of lost profits is a fact intensive determination. At a minimum, 18*18 opinions or estimates of lost
profits must be based on objective facts, figures, or data from which the amount of lost profits can be
ascertained." Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 84 (Tex.1992); see, e.g., Pena v.
Ludwig, 766 S.W.2d 298, 304 (Tex.App.-Waco 1989, no writ); Frank B. Hall & Co. v. Beach, Inc., 733
S.W.2d 251, 258 (Tex.App.-Corpus Christi 1987, writ ref'd n.r.e.); Keller v. Davis, 694 S.W.2d 355,
357 (Tex.App.-Houston [14th Dist.] 1985, writ ref'd n.r.e.); Automark of Tex. v. Disc. Trophies, 681
S.W.2d 828, 830 (Tex.App.-Dallas 1984, no writ). "Although supporting documentation may affect the
weight of the evidence, it is not necessary to produce in court the documents supporting the opinions
or estimates." Holt Atherton Indus., Inc., 835 S.W.2d at 84.
B&W Supply, Inc. v. Beckman (Tex.App.- Houston [1st Dist.] Apr. 9, 2009)(Keyes)
(JNOV, breach of contract, excuse defense, lost profit damages, DTPA counterclaim)
REVERSE TC JUDGMENT AND RENDER JUDGMENT: Opinion by Justice Keyes
Before Justices Jennings, Keyes and Higley
01-07-00574-CV B & W Supply, Inc. and Weston Wyatt v. Lawrence and Diane Beckman
Appeal from 215th District Court of Harris County
Trial Court Judge: Hon. Levi J. Benton
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