DISSENTING Opinion Filed August 28, 1995

FILED IN SUPREME COURT OF TEXAS JUL - 5 1996 JOHN T. ADAMS, Clerk

By Deputy fnTfie 

### Court ofAppeals 

## Wxtttj Btstrtct of Qkxas at Baltas No. 05-92-01354-CV STATE FARM LLOYD'S INSURANCE COMPANY, Appellant

ASHBYAAA AUTOMOTIVE SUPPLY CO., INC. AND JOE BEN ASHBY, JR., Individually, Appellees On Appeal from the 298th Judicial District Court Dallas County, Texas Trial Court Cause No. 89-13647-M 

### DISSENTING OPINION Before ChiefJustice Thomas1 and Justices Ovard and Barber Dissenting Opinion By Chief Justice Thomas 

### Ijoin the majority opinion except as it relates to the damage award for lost profits. 

## The majority concludes there is no evidence oflost profits and reverses and renders atake

## nothingjudgmentas to these damages. Because Ibelieve the law andfacts supportsuch an 1The Honorable LindaThomas wasonthe originalpanel atthetimethiscausewas submittedfor decision. JusticeThomas was sworn in as Chief Justice on January 1,1995.award, I dissent to that portion of the opinion. LOST PROFITS A. Standard ofReview In addressing a no-evidence challenge, we consider only the evidence and inferences, viewed in their most favorable light, that support the jury findings and disregard all evidence and inferences to the contrary. Orozco v. Sander, 824 S.W.2d 555, 556 (Tex. 1992) (per curiam). Ifthere is more than a scintilla of evidence to support the finding, the no-evidence challenge must fail. Orozco, 824 S.W.2d at 556. The evidence is no more than a scintilla, and thus no evidence, when it is so weak as to do no more than create a mere surmise or 

### suspicion ofits existence. Motsenbocker v. Potts, 863 S.W.2d 126, 132 (Tex. App.-Dallas 1993, no writ). However, if the evidence supplies some reasonable basis for differing 

### conclusions by reasonable minds as to the existence of a vital fact, then there is some evidence. Motsenbocker, 863 S.W.2d at 132. 

### Inreviewing afactual-sufficiency point, we consider all oftheevidence, including any evidence contrary to thejudgment. Plas-Tex, Inc. v. U.S. Steel Corp., 772 S.W.2d 442, 445 

### (Tex. 1989); Burnettv. Motyka, 610 S.W.2d 735, 736 (Tex. 1980). Afinding canbe setaside only if itis so contrary to the overwhelming weight ofthe evidence as to beclearly wrong 

### and unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986) (percuriam). 

### In making its findings, the jury weighs the evidence, assesses the credibility of witnesses, and resolves conflicts and inconsistencies. McGalliard v. Kuhlman, 722 S.W.2d

-2-694, 697 (Tex. 1986). The jurors are the judges of the facts proved and of the reasonable inferences to be drawn therefrom. Lockley v. Page, 142 Tex. 594, 598, 180 S.W.2d 616, 618 (1944). This Court is not a fact finder, and we cannot substitute ourjudgment for that of 

### the jury, even if a different finding could be reached on the evidence. Clancy v. Zale Corp., 705 S.W.2d 820, 826 (Tex. App.-Dallas 1986, writ refd n.r.e.).
B. Law on Lost Profits 

### Recovery for lost profits does not require that the loss be susceptible of exact calculation. HoltAtherton Indus., Inc. v. Heine, 835 S.W.2d 80, 84 (Tex. 1992). However, 

### the injured party must do more than show itsuffered some lost profits. The amount ofthe loss must be shown by competent evidence with reasonable certainty. Heine, 835 S.W.2d at 84. What constitutes reasonably certain evidence of lost profits is a fact-intensive determination. As a minimum, opinions or estimates of lost profits must be based on 

### objective facts, figures, or data from which the amount oflost profits can be ascertained. Heine, 835 S.W.2d at 84. C. Legal Sufficiency ofthe Evidence 

### With respect to lost profits, the majority renders judgment in State Farm's favor 

### because Ashby, Inc. failed to include its $1,600 mortgage payment as a liability in three 

### monthly income statements given to its CPA and introduced into evidence. The majority 

## reasons thatAshby, Inc. thereforefailedtoprovide "one complete calculation" oflostprofits and concludes the evidence is legallyinsufficient. Inthe process, itrecognizes, then ignores,

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### a "variety ofevidence
. . . regarding cost ofinventory, income stream, overhead, and alarge number of Ashby, Inc.'s business records" solely on the basis of its interpretation ofHeine. The majority interprets Heine to mean "that once a party has chosen the method for determining lost profits, it must includesufficient evidence to show profits with a reasonable certainty." (Emphasis added.) Based on that interpretation, the majority concludes that if
one liability is missing from three months of statements (in a case where profitability for ten years is being examined), and this fact isbrought to the jury's attention, that party has failed to provide sufficient evidence to show lost profits withreasonable certainty. I cannot agree that Heine intended such a result. In Heine, the plaintiffs' testimony was the only evidence presented concerning lost profits. Mr. Heine testified that he had $200,200 in lostincome but could not explain how he came up with that figure. The court first noted that lost income is not the correct 

### measure ofdamages. Heine, 835 S.W.2d at 84. Further, the court noted that even if this 

### testimonywas otherwise sufficient, theevidence was legallyinsufficientbecause Heine failed to provide any indication ofhow hedetermined his lost profits. Thus, the court had nobasis for determining whether the damages were established with reasonable certainty or were based on pure speculation. Heine, 835 S.W.2d at 84. 

### Additionally, Mr. Heine testified he had lost several contracts based on the defendant's conduct but could not specify which contracts were lost, how many were lost, 

### how much profitwould have been made from the contracts, orwhowouldhave awarded the

-4-contracts. Heine, 835 S.W.2d at 85. The court concluded that Heine's bare assertions that contracts were lost did not "demonstrate a reasonably certain objective determination of lost profits." Heine, 835 S.W.2d at 85. Thus, the problem in Heine was that there was no evidence to support a complete calculation of lost profits. Heine, 835 S.W.2d at 85. Unlike Heine, the record in the instant case is replete with supporting documentary evidence establishing the company's sales, cost of goods sold, and the company's operating expenses over the last several years. The record contains five two-inch-thick volumes and one one-inch thick volume containing corporate tax returns, balance sheets, income statements, and other financial records. Thus, Ashby, Inc. did more than make a bare assertion of lost profits; Ashby, Inc. put forth objective, rather than subjective, facts, figures, and data from which the amount of lost profits could be ascertained. The fact that Ashby, Inc.'s statements of income for three months in 1989 failed to include the monthly mortgage payment is not dispositive ofwhether there is some evidence, i.e., more than a scintilla, of lost profits. Ashby, Inc. put on evidence of revenues and expenses. The jury was aware the mortgage payment was missing from the three income statements and the amount of the mortgage payment; thus, the jury could take that into account when determining whether there were lost profits. 

### To applyHeine as the majority does results in this Courtcompletely negating all of the financial information that was introduced into evidence by Ashby, Inc. Such an 

### application, Ibelieve, is contrarytothe no-evidence standard ofreview. Furthermore, such

-5-an application could lead to absurd results. 

### Forexample, assume thesame facts astheinstant case, except assume thecompany's tax returns show a million dollars a year in taxable income for the past ten years. At trial, there is evidence that three income statements provided to the company's CPA failed to reflect a box of pencils as a supply expense. Under the majority's strict application of Heine, the company would have failed to provide a "complete calculation;" thus, a no-evidence challenge would be sustained. Ashby, Inc. provided probative evidence supporting a complete calculation for lost profits, and a jury is capable of making that calculation. Because there is more than a scintilla of evidence to support lost profits, I would hold the evidence is legally sufficient to support the jury's award. D. Factual Sufficiency Having concluded the evidence is legally sufficient, the next question is whether the evidence is factually sufficient. On this point, State Farm argues profits could not be determined with reasonable certainty because: (i) the business operated at a loss until two 

### years prior to the fire; (ii) profits were subject to "uncertain and changing conditions" because Ashby, Inc. was a seasonalbusiness; and (iii) the business was "dependent on the state of the economy." These arguments are without merit. 

### First, State Farm argues that because Ashby, Inc. operated at a loss from 1980 

### through 1986, there is no proof of a record ofprofits in the past orfuture. I agree that

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## proofofan operation ofabusiness at aloss, withoutmore, fails to meet the test ofshowing lost profits with reasonable certainty. See Turner v. PVInt'l Corp., 765 S.W.2d 455, 465 (Tex. App.-Dallas 1988), writ denied per curiam, 778 S.W.2d 865 (1989). In this case, however, the evidence showedthat the business turned around in 1987, and the corporation operated at a profit from 1987 until the fire in June 1989. 

### Second, State Farm contends that"any alleged loss would bedependent onuncertain and changing conditions." The argument is premised on the fact that Ashby, Inc. is an automotive business and that the automotive business is seasonal, i.e., more repairs are 

### performed during summer months. Taking this argument to its logical extension, any industry that generates more income at one time ofyear than another could never establish lost profits because they would be subject to "uncertain and changing conditions." Many businesses experience seasonal highs and lows. That fact, however, does not make their anticipated profits over a period of time any less certain. Likewise, State Farm's third argument that the automotive industry is "dependent on the state of the economy" holds true for any industry. The fact that Ashby, Inc. is dependent on the state of the economy does not make its losses uncertain or speculative. As stated previously, the record contains hundreds of pages of Ashby, Inc.'s financial condition, including corporate tax returns for the past several years, income statements, balance sheets, etc. Additionally, Mr. Ashby, as well as his certified public accountant, testified at length regarding the business's financial condition. This Court is not a fact%'

finder, and we cannot substitute ourjudgment for that of the jury, even if a different finding could be reached on the evidence. See Clancy, 705 S.W.2d at 826. Based on the record, I cannot say that the jury's finding relative to lost profits is so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust. Accordingly, I would affirm the jury's award of $75,000 for lost past profits and $25,000 for lost future profits.

Do Not Publish Tex. R. App. P. 90 921354DF.U05 LINDA THOMAS CHIEF JUSTICE

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### Court ofAppeals 

## TxittfStstrtrt ofGkxas at Battas No. 05-92-01354-CV *

STATE FARM LLOYD'S INSURANCE COMPANY, Appellant
V. 

### ASHBY AAAAUTOMOTIVE SUPPLY CO, INC., ET AL, Appellee 

## I, Maria Sanchez, CLERK ofthe Court ofAppeals for the Fifth District ofTexas, 

## atthe CityofDallas, herebycertifythatthefollowinglistofdocuments aretrue andcorrect copies as they appear ofrecord in the Court: 

## (1) Opinion dated August 28, 1995 signedby Justice Will Barber. 

## (2) Dissenting opinion dated August 28, 1995 signedbyJustice LindaThomas. Given under my hand and seal ofsaid Court, at Dallas, this the 26th day ofJune,

1996. Maria Sanchez, CLERK