Court Opinion

ID: 4072933
Source: CourtListenerOpinion
Date Created: 2016-09-30 03:21:22.828234+00
Date Added: 2024-06-11T12:52:14.766170
License: Public Domain

ACCEPTED
                                                                                           14-14-00905-CV
                                                                           FOURTEENTH COURT OF APPEALS
                                                                                        HOUSTON, TEXAS
                                                                                      9/10/2015 3:50:09 PM
                                                                                     CHRISTOPHER PRINE
                                                                                                    CLERK

                                         In The
                                    Court of Appeals
                                        For The                            FILED IN
                                                                    14th COURT OF APPEALS
                               Fourteenth District of Texas            HOUSTON, TEXAS
                                                                    9/10/2015 3:50:09 PM
                                                                    CHRISTOPHER A. PRINE
                                  NO. 14-14-00905-CV                         Clerk

       Colorado County Oil Company, Inc., Day & Night, Inc., and SNP Business, Inc.
                                      Appellants

                                            v.

                           Star Tex Distributors, Inc., Appellee

                          On Appeal from the 281st District Court
                                   Harris County, Texas
                            Trial Court Cause No. 2012-43621

        APPELLANT COLORADO COUNTY OIL COMPANY, INC’S REPLY
                             BRIEF

                                          Donald H. Grissom
                                          don@gandtlaw.com
                                          State Bar No. 08511550
                                          509 West 12th Street
                                          Austin, Texas 78701
                                          (512) 478-4059
                                          (512) 482-8410 fax

ATTORNEY FOR APPELLANT COLORADO COUNTY OIL COMPANY, INC.

                           ORAL ARGUMENT REQUESTED

                                             i	
  
	
  
                                           TABLE OF CONTENTS

Table of Contents .......................................................................................ii

Table of Authorities ................................................................................. iii

A. No Evidence of Willful and Intentional Act of Interference ................ 2

B. Colorado County Legally Competed for the Contract .......................... 6

C. No Evidence that Colorado County Caused Damage to Star Tex......... 7

D. No Evidence to Support Award of Contractual Damages .................... 8

Conclusion ................................................................................................. 9

Prayer ....................................................................................................... 10

Certificate of Service ............................................................................... 11

Certificate of Compliance ........................................................................ 11

                                                               ii	
  
	
  
                                            TABLE OF AUTHORITIES

Cases

ACS Investors, Inc. v. McLaughlin, 943 S.W.2d 426, 430 (Tex.1997) .................... 2

Formosa Plastics Corporation USA v. Presidio Engineers and Contractors, Inc.,

       960 S.W.2d 41 (Tex.1998) .................................................................................... 9

Holt Atherton Indus., Inc. v. Heine 835 S.W.2d 80, 85 (Tex.1992) ......................... 9

T.O. Stanley Boot Co., Inc. v. Bank of El Paso, 847 S.W.2d 218, 220 (Tex.1992)

       ............................................................................................................................ 1,7

                                                                    iii	
  
	
  
                                          In The
                                     Court of Appeals
                                         For The
                                Fourteenth District of Texas

                                   NO. 14-14-00905-CV

       Colorado County Oil Company, Inc., Day & Night, Inc., and SNP Business, Inc.
                                      Appellants

                                              v.

                            Star Tex Distributors, Inc., Appellee

                          On Appeal from the 281st District Court
                                   Harris County, Texas
                            Trial Court Cause No. 2012-43621

        APPELLANT COLORADO COUNTY OIL COMPANY, INC’S REPLY
                             BRIEF

TO THE HONORABLE COURT:

           Star Tex asserts in its brief that Colorado County has failed to preserve error

on appeal because it did not file a Motion for New Trial. However, on a challenge

to the legal sufficiency or a no-evidence challenge, the procedure for preserving

the error is by filing a motion for judgment notwithstanding the verdict or a motion

to disregard jury answers. See T.O. Stanley Boot Co., Inc. v. Bank of El Paso, 847

                                              1	
  
	
  
S.W.2d 218, 220 (Tex.1992). On October 9, 2014, Colorado County filed its

Motion for JNOV and Motion to Disregard Jury Findings (CR,p.51). This motion

was denied by the Court on October 20, 2014 (CR,p.79).

       To prevail on its cause of action for tortious interference with an existing

contract, Star Tex had the burden to prove, by a preponderance of the evidence,

each of the following elements: (1) that a contract subject to interference exists, (2)

the commission by the defendant of a willful and intentional act of interference

with the contract, (3) that the willful and intentional act proximately caused injury,

and (4) actual damages or loss occurred. ACS Investors, Inc. v. McLaughlin, 943
S.W.2d 426, 430 (Tex.1997).

       A.  No Evidence of Willful and Intentional Act of Interference

       The element of intent is most commonly proven through circumstantial

evidence taking into account what knowledge the party possessed at the time of its

action, what its duty was, and whether it is legally allowed to take such action(s).

       Star Tex relies on Chip Leach’s (Colorado County) testimony that normally,

if he saw a branded location, he would assume it was under contract and would

seek confirmation that no contract existed before pursuing the business of that

facility. Here, Leach followed his normal procedure and did seek that confirmation

by asking a direct question to SNP as to whether it had a supply contract with Star

Tex (RRV3,p.190-191; RRV4,p.75,83). The answer was, “no” (RRV3,p.190-191;

                                          2	
  
	
  
RRV4,p.75,83). Leach had no duty to inquire further, nor reason to disbelieve

SNP, especially since he had an existing business relationship with SNP’s owner’s

(Shokat Ali) relatives (RRV3,p.190; RRV4,p.17-18). While Colorado County had

no legal duty to verify SNP’s statement that there was no contract, Colorado

County went a step further and contacted Shokat Ali’s relative, who was

responsible for directing SNP to Colorado County, to inquire whether a supply

contract existed (RRV4,p.22-23). Again, the answer was, “no” (RRV4,p.23). Star

Tex’s testimony about their own practice of getting a “release” from another

supplier is not evidence of, nor does it create, any legal duty.

       On both direct examination and cross-examination, the consistent and

repeated testimony of the parties in this case was that Colorado County was told by

the representatives of SNP that there was no supply contract for the facility

(RRV3,p.190-191; RRV4,p.22-23, 75, 83). Although Star Tex claims to have

called Colorado County, but did not talk to anyone, two days prior to Colorado

County making its first delivery to the facility (RRV3, p. 178), it was not until later

that Colorado County was sent a copy of the alleged contract (RRV3,p.14). Still,

when Colorado County received a copy of the contract, the parties to that contract

were not the same as the parties with whom Colorado County contracted, thus

creating further confusion (RRV3,p.216). The timeline below outlines what

knowledge Colorado County possessed as the events of this case were unfolding:

                                           3	
  
	
  
       December	
           • Shokat	
  Ali	
   Contacts	
  Colorado County	
   (RRV3,	
   p.206;	
  RRV4,p.80-­‐81,	
  88)
         2010

                            • Leach	
  visits facility	
  (RRV3,p.206)	
  Shokat	
  Ali	
  states	
   he	
  has	
  no	
   contract	
  
          January	
  
           2011
                              (RRV3,p.190-­‐191,207;	
  RRV4,p.75,	
  83,	
   209)

       January	
  25,	
  
                            • SNP	
  enters	
  into	
  contract	
  with	
  Colorado	
  County	
  (CCOC	
  brief	
  Appendix	
  2)
          2011

                            • Colorado	
   County	
   coordinates	
  branding	
  incentive	
  package	
  with	
  Valero	
  
       March	
  2011

        April/May	
  
                            • Star	
  Tex	
   notified	
  of	
   Shokat	
  Ali's	
   intent	
  to	
  cancel contract	
  (RRV4,p.248-­‐250)
          2011

                            • Colorado	
   County	
   pays	
  $50,000 Valero	
  incentive (RRV3,p.222)
        May	
  2011

                            • Star	
  Tex	
   calls	
  Colorado	
   County	
   (no	
   answer/no reply)(RRV3,p.9,	
  178)
       May	
  6,	
  2011

                            • Colorado	
   County	
   begins	
   fuel	
   deliveries	
   to	
  SNP(RRV4,p.23)
       May	
  8,	
  2011

          May	
  12,	
      • Star	
  Tex	
   emails	
  Colorado	
  County	
   copy	
  of	
  contract	
  (RRV3,p.14)
           2011

                      Star Tex’s belief that Colorado County should have ceased any relationship

with the facility because, it could have/didn’t have much money in it, does not

create a legal duty nor does it constitute evidence of any material fact. It is also

without merit because Colorado County legally and fairly obtained SNP’s

                                                                               4	
  
	
  
business. No evidence was presented by any party to dispute Leach’s testimony

regarding his lack of knowledge of Star Tex’s claimed contractual relationship

with the facility. Therefore, if Colorado County acted under the premise that there

was no supply contract for the convenience store (RRV3,p.190-191, 207;

RRV4,p.75-78,83, 209), and no evidence was presented to contradict this, then it is

an impossibility that Colorado County could have intended to cause Day & Night

to breach its contract with Star Tex.

       Star Tex asserts or insinuates that Colorado County’s agreement to pay, up

front, the $50,000 from Valero’s incentive package was the inducement for SNP to

breach its contract with Star Tex. Again, this argument is without merit and

contradicted by Star Tex’s own testimony. First, Star Tex (Feroz Momin) testified

that this was a common industry practice (RRV2,p.87-91). Second, he testified that

he offered the same amount to SNP (RRV3,p.154-155). This was obviously

refused because Shokat Ali had already decided to stop doing business with Star

Tex (RRV4,p.248-250). Moreover, no evidence was introduced to contradict the

testimony of both Shokat Ali and Chip Leach that Shokat asked Leach if Valero

would pay incentives (RRV3,p.226; RRV4,p.21,85-86). That request was

forwarded to Valero (CCOC Brief Appendix 3) who acknowledge that it would

pay branding incentives. That response was forwarded back to Shokat Ali. All of

this being common in the industry (RRV2,p.87-91; RRV4,p.21,31). This is further

                                         5	
  
	
  
illustrated by the fact that Shokat Ali knew to ask about the Valero branding

incentives.

       B.  Colorado County Legally Competed for the Contract

       There was no evidence that Colorado County acted with the requisite intent

to interfere with the dealer franchise agreement between Star Tex and Day &

Night. All evidence shows Colorado County intended to act in a manner allowed

by law and in a manner that is completely justified. The uncontroverted evidence

was that SNP contacted, without any solicitation, Colorado County about

supplying SNP with gasoline (RRV4,p.80-81). This occurred in late 2010

(RRV4,p.80-81). SNP specifically confirmed to Colorado County that it had no

other contract for the supply of gasoline (RRV3,p.190-191; RRV4,p.75,83). A

contract was then executed on January 25, 2011 between Colorado County and

SNP (CCOC Brief Appendix 2). As a matter of law, Colorado County had a legal

right to and was justified in entering into this contract.

       Star Tex’s argument that Colorado County should have relented and

terminated its contract with SNP when approached by Star Tex four months later is

contrary to law, and absurd. There is no legal basis for upholding a verdict for

tortious interference where Colorado County was simply engaging in lawful

business activity and honoring the terms if its own contract. When evidence is so

                                            6	
  
	
  
weak it constitutes no evidence, such evidence will not support a verdict. T.O.

Stanley Boot Co., Inc. at 222.	
  

       C.  No Evidence that Colorado County Caused Damage to Star Tex

       The jury was given the following definition in the charge:

              “Proximate cause” means a cause that was a substantial
              factor in bringing about an event and without which
              cause such event would not have occurred. In order to be
              proximate cause, the act or omission complained of must
              be such that a person using the degree of care required of
              him would have foreseen that the event, or some similar
              event, might reasonably result therefrom. There may be
              more than one proximate cause of an event.

       The act of Colorado County entering into a contract with SNP to supply fuel

to the Bammell Road store was not the act that proximately caused Star Tex’s

injury. Shokat Ali had already made the decision to discontinue business with Star

Tex (RRV4,p.91-92) prior to his contacting Colorado County. The intent was to

cease purchasing fuel from Star Tex (RRV4,p.91-92) no matter who was chosen to

be the new fuel supplier. All the evidence and testimony points to the fact that

Shokat Ali was dissatisfied with Star Tex’s services and was seeking out a new

supplier (RRV4,p.55,97-105,122,191-192). It turned out to be Colorado County.

The fact that Colorado County became the new supplier is inconsequential to this

element because Shokat Ali intended to terminate Day & Night’s relationship with

                                          7	
  
	
  
Star Tex anyway (RRV4,p.91-92).          Star Tex has failed to provide evidence

supporting an alternative position relating to this element of tortious interference.

       D.  No Evidence to Support Award of Contractual Damages

       Star Tex failed to submit the proper measure of damages and failed to meet

its burden to secure jury findings sufficient to support a judgment. The term

“contractual damages” is not a proper measure of damages. It is ambiguous and

misleading. This term failed to direct the jury’s attention to any meaningful legal

standard for awarding damages, and cannot support rendition of judgment against

Colorado County.

       Star Tex is limited to “contractual damages”. Paragraph 23 of the contract

clearly provides:

             Star Tex will deliver at the posted terminal price plus
             .0100 (One) cent per gallon plus transportation for profit
             (CCOC Brief Appendix 1).

       The contract only speaks of a 1¢ per gallon profit (RRV3,p.150). The only

measure of contractual profit is found here. Star Tex acknowledged that

transportation was not an element for calculation of profits (RRV3,p.148-150).

       These “contractual damages” awarded by the jury are not provided for in the

contract. The contract provisions provide the amount of “contracted profits” that

Star Tex could be entitled to receive. Multiplying the 521,208 gallons (12 months)

                                           8	
  
	
  
times 1¢ per gallon totals $5,212.08. That is the maximum amount of damage

recoverable by Star Tex from Colorado County.

       According to Sohail Ali’s testimony, he terminated the contract with Star

Tex (RRV4,p.248-250) and therefore, Star Tex would only be entitled to damages

for the remaining 11 months of the year-to-year extension. This would make the

maximum amount recoverable by Star Tex only $4,777,74.

                                     CONCLUSION

       A motion for new trial is not a prerequisite to an appellate complaint about

the legal sufficiency of evidence. Tex. R. Civ. P. 324(a), (b). Star Tex has failed to

provide evidence to support all of the elements of its cause of action for tortious

interference with an existing contract. Specifically, there is no evidence that

Colorado County committed any act that could be construed as willful and

intentional interference to any purported agreement between Day & Night and Star

Tex.

       Further, there is no evidence to support Star Tex’s calculation of damages.

Particularly, there was no complete damage calculation submitted by Star Tex as

required by law. Formosa Plastics Corporation USA v. Presidio Engineers and

Contractors, Inc., 960 S.W.2d 41 (Tex.1998), and the mixed methodology

employed by Star Tex causes the opinion to lack reliability. Holt Atherton Indus.,

Inc. v. Heine 835 S.W.2d 80, 85 (Tex.1992).

                                          9	
  
	
  
                                    PRAYER

       WHEREFORE, PREMISES CONSIDERED, for these reasons, and in the

interest of justice and fairness, Colorado County asks the Court to reverse the

Jury’s findings and render judgment for Appellant, Colorado County Oil

Company, Inc.

       Dated, this the 10th day of September, 2015

                                                  Respectfully submitted,

                                                  /s/ Donald H. Grissom
                                                  Donald H. Grissom
                                                  GRISSOM & THOMPSON, LLP
                                                  TX State Bar No. 08511550
                                                  don@gandtlaw.com
                                                  509 West 12th Street
                                                  Austin, Texas 78701
                                                  512/478-4059
                                                  512/482-8410 Fax

                                         10	
  
	
  
                         CERTIFICATE OF SERVICE
       I hereby certify that a true and correct copy of the foregoing document has
been forwarded to all counsel of record in compliance with Texas Rules of
Appellate Procedure, via facsimile, electronic case filing, or certified mail return
receipt requested, on September 10, 2015

                                                 /s/DonaldHGrissom
                                                 Donald H. Grissom

                      CERTIFICATE OF COMPLIANCE
       I hereby certify on this date that the foregoing document contains 2,131
words.

                                                 /s/DonaldHGrissom
                                                 Donald H. Grissom

                                        11