Court Opinion

ID: 9746766
Source: CourtListenerOpinion
Date Created: 2023-08-27 14:36:37.842896+00
Date Added: 2024-06-11T07:25:16.667855
License: Public Domain

HORSEY, Justice,
with whom CHRISTIE, Chief Justice, joins, dissenting:
We would affirm Superior Court’s grant at the close of plaintiff Moody’s case of a directed verdict for defendant Nationwide. In our view, plaintiff Moody failed to meet his burden of presenting sufficient evidence as the circumstances permitted to enable the jury, as trier of fact, to find with reasonable certainty the probable loss which Moody sustained. Cf. Henne v. Balick, Del.Supr., 146 A.2d 394, 396 (1958); Restatement (Second) of Torts § 912 (defining “certainty” to mean “with as much certainty as the nature of the tort and the circumstances permit”). In this case, plaintiff’s probable loss must be measured in terms of Moody’s share of the net profits of a new business enterprise conducted as a partnership. Thus, the question is whether Moody presented sufficient evidence that the partnership made a net profit — before or after his injury — for a jury to find and calculate with reasonable certainty Moody’s probable loss over the eighteen months of disability for which he sought PIP benefits.
The trial court ruled that plaintiff’s burden of proving his PIP claim under 21 Del.C. § 2118 for recovery of “lost earnings” was no different from the proof required in the usual tort claim for loss of business profits. The majority does not find error in that ruling, nor do we. However, the majority then finds $240 to be sufficient evidence of Moody’s share of the business’ net profits to date of injury for a jury to project with reasonable certainty Moody’s “lost earnings” claim for the eighteen months’ maximum period of PIP recovery. We cannot agree that Moody’s evidence in chief viewed, as it must be, in a light most favorable to plaintiff, was sufficient for a jury to find that $240 represents Moody’s share of the business’ net profit to date of injury. The trial court, correctly applying Delaware law, found otherwise and that finding should be affirmed as not clearly erroneous. Drozdov v. Webster, Del.Supr., 345 A.2d 895, 896 (1975).
*295Moody’s figure of $240 represents nothing more than his admitted share of a “draw” based on six non-consecutive days of gross receipts of $707. Moody did not testify that this sum represented his share of the net earnings of the business from its first “week” of operations. He stated that this sum was what was left over after he set aside arbitrary amounts for certain, but not all, of the business’ expenses. He conceded that $240 was no more than a “guess” at his share of the profit; and his attorney conceded that Moody had fialed to take into account other business expenses, including social security and income taxes, which his attorney then argued should be “about twenty percent.” In our view, this testimony by plaintiff does not meet the test of reasonable certainty for estimating what Moody’s share of the net profits of the business would have been for eight days or any other period of the business’ actual operation. The evidence was clearly insufficient to permit a projection over eighteen months of the business’ recurring net profits and Moody’s share thereof.
The majority also makes a distinction between the required certainty of proof of future losses and historical losses, a distinction we question. The Court reasons that proof of future loss necessarily involves some speculation, Henne v. Balick, while proof of past loss is essentially a question of credibility rather than sufficiency of evidence. Thus, because credibility is ultimately involved, the Court concludes that the issue of damages was a matter for the trier of fact to resolve. The Court’s distinction of proof of damages of an historic loss from a future loss, if valid, would, we believe, largely eviscerate the requirement that damages be proved with a reasonable degree of certainty. We also understand Delaware law to require more certainty in proof of past damages than in projecting future damages. Re v. Gannett, Del.Super., 480 A.2d 662, 668 (1984), aff'd, 496 A.2d 553, 558-559 (1985).
We also think that the majority misconstrues the trial court’s bench ruling. In effect, the court rendered its directed verdict on not one, but two, findings: (1) that plaintiff failed to present “substantial evidence” to support his PIP “lost earnings” claim; and (2) that plaintiff failed to come forward with the best evidence that the circumstances permitted to establish his “lost earnings” claim. The trial court thereby implicitly and, in our view, properly rejected application of the “new business rule” to this tort case. This rule is but an extension of the general rule of the Restatement (Second) of Torts § 912 and the law of Delaware: that a plaintiff may not recover damages for loss of income tor-tiously caused without providing the trier of fact with “some reasonable basis upon which a jury may estimate with a fair degree of certainty the probable loss which the plaintiff will sustain.” Drozdov, 345 A.2d at 896.
Under the “new business” corollary to section 912, a number of jurisdictions, including Delaware, have denied any recovery of loss of profits for a business that, unlike an established business, has no history of profits. The rationale for the “new business” rule is that the outcome of a new business is too uncertain for calculation of projected profits to permit recovery of loss of profits where the new business has no history of profits. Re v. Gannett Co., Inc., Del.Super., 480 A.2d 662, 668 (1984), aff'd, 496 A.2d 553, 558-559 (1985); 22 Am.Jur.2d Damages § 173 at page 245; Restatement (Second) of Law of Contracts § 352. Other jurisdictions decline to preclude recovery of lost profits for a new business if the amount of lost profits can be shown with reasonable certainty. Dobbs, Handbook on the Law of Remedies § 3.3 (1973).
In tort cases in particular, there are exceptions to the requirement of proof of lost profits to a reasonable certainty, even as to new businesses. One of these exceptions is the best available evidence exception. McCormick, Handbook on the Law of Damages (1935) (pp. 101-103). Under this exception, the best available evidence will be sufficient if it provides a “reasonable basis for computation [and is] the best evidence which is obtainable under the circumstances of the case and which will enable the jury to arrive at an approximate estimate of the loss_” Hoffer Oil Corpo*296ration v. Carpenter, 10th Cir., 34 F.2d 589, 592 n. 18 (1929); Olivetti Corp. v. Ames Business Systems, Inc., N.C.Ct.App., 81 N.C.App. 1, 344 S.E.2d 82, 91 (1986). This more liberal rule has particular application to tort actions for recovery of losses suffered in new business undertakings. It appears to us that the trial court was prepared to apply this exception in this case but declined to upon finding plaintiff Moody to have failed to have come forward with the best evidence of his business’ profitability that the circumstances would permit.1 In our view, the record supports this finding; and such a finding of fact cannot be found to be clearly erroneous. The trial court directed a verdict for defendant for failure of plaintiff’s proof to meet the sufficiency of the evidence test for an award of damages. That threshold determination was for the court to make; and the court made that determination through a correct application of the law of damages to the facts.

. The trial court stated in part in its bench ruling, “a self-employed person has all kinds of avenues to establish his loss of earnings normally ... plaintiff can't walk into court with a piece of paper like this and make out a claim. It is pure conjecture that you are asking this jury to conclude that he has lost money and how much it would be.” We interpret the trial court as accepting and applying the Restatement's definition of "certainty” of proof as meaning "with as much certainty as the nature of the tort and the circumstances permit.” Restatement (Second) of Torts §§ 9, 12.