Opinion ID: 40778
Heading Depth: 2
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Heading: Damages Must Be Proven to a Reasonable Certainty

Text: 12 In Texas, lost profit damages must be established with reasonable certainty. Tex. Instruments Incorp. v. Teletron Energy Mgmt., 877 S.W.2d 276, 281 (Tex.1994). Lost profit damages may not be based on evidence that is speculative, uncertain, contingent, or hypothetical. Carter v. Steverson & Co., 106 S.W.3d 161, 165-66 (Tex.App.-Houston [1st Dist.] 2003, pet. denied). A plaintiff must adduce evidence from which the jury can reasonably estimate the amount of loss. Davis v. Small Bus. Inv. Co., 535 S.W.2d 740, 743 (Tex.Civ.App.-Texarkana 1976, writ ref'd n.r.e.). While some uncertainty as to the amount of damages is permissible, uncertainty as to the fact of damages will defeat recovery. Id. 13 No-hire agreements and covenants not to compete often include a liquidated damages provision to avoid the difficulty of calculating damages. See, e.g., H&M Commercial Driver Leasing, Inc. v. Fox-Valley Containers, Inc., 209 Ill.2d 52, 282 Ill.Dec. 160, 805 N.E.2d 1177, 1184 (Ill. 2004) (no-hire agreement contained liquidated damages clause). These provisions are valid when damages are uncertain and the stipulated sum is reasonable. Mayhall v. Proskowetz, 537 S.W.2d 320, 322 (Tex. Civ.App.-Austin 1976, writ ref'd n.r.e.). The no-hire provision at issue in the present case did not have a liquidated damages clause. 14 Wilson Solutions cannot prove to a reasonable certainty the fact that it was damaged by Anorad's breach. The damages request relies on the assumption that Schwartzman would continue working for Wilson Solutions, earning consulting fees for the year in question. This type of contingency, created by his at-will status, is impermissible in Texas. Similarly, a jury would have difficulty estimating the losses suffered by Wilson Solutions. The purpose of lost profit damages it to put the nonbreaching party in the position it would have been in had the contract been performed. Osoba v. Bassichis, 679 S.W.2d 119, 122 (Tex.App.-Houston [14th Dist.] 1984, writ ref'd n.r.e.). Here, because Schwartzman was an at-will employee, it is impossible to determine that position with the amount of certainty required by Texas law. 15