                                                                                          ACCEPTED
                                                                                      01-15-00326-CV
                                                                           FIRST COURT OF APPEALS
                                                                                   HOUSTON, TEXAS
                                                                                12/21/2015 3:00:20 PM
                                                                                CHRISTOPHER PRINE
                                                                                               CLERK

                      No. 01-15-00326-CV
_____________________________________________________________
                                                                FILED IN
                  IN THE COURT OF APPEALS       1st COURT OF APPEALS
                                                    HOUSTON, TEXAS
                   FIRST DISTRICT OF TEXAS
                                                12/21/2015 3:00:20 PM
                       HOUSTON, TEXAS           CHRISTOPHER A. PRINE
_____________________________________________________________
                                                         Clerk

       DON ABBOTT HOLMES, GAYLE EISLER HOLMES,
         and the COMMUNITY PROPERTY ESTATE OF
      DON ABBOTT HOLMES and GAYLE EISLER HOLMES,

                                                  Appellants,

                                    v.

                    JETALL COMPANIES, INC.,

                                                  Appellee.


                On Appeal from the 127th District Court
                       Harris County, Texas

     CORRECTED BRIEF AND APPENDIX OF APPELLANTS


   Geoffrey Berg                         Martin J. Siegel
   Texas Bar No. 00793330                Texas Bar No. 18342125
   BERG FELDMAN JOHNSON                  LAW OFFICES OF
     BELL, LLP                             MARTIN J. SIEGEL, P.C.
   4203 Montrose Blvd., Suite 150        2222 Dunstan Road
   Houston, Texas 77006                  Houston, Texas 77005
   Telephone: (713) 526-0200             Telephone: (281) 772-4568
   Gberg@bfjblaw.com                     Martin@Siegelfirm.com

                       Attorneys for Appellants


                                          Oral Argument Requested
              IDENTITY OF PARTIES AND COUNSEL


Appellants:

     Don Abbott Holmes
     Gayle Eisler Holmes


Trial and Appellate Counsel for Appellants:

     Christopher D. Nunnallee
     Law Offices of Christopher D. Nunnallee
     1413 Brittmoore Road
     Houston, Texas 77043

     Charles T. Kelly
     Julie Hamrick
     Kelly & Smith, P.C.
     4305 Yoakum Blvd.
     Houston, Texas 77006

     Martin J. Siegel
     Law Offices of Martin J. Siegel, P.C.
     2222 Dunstan Road
     Houston, Texas 77005

     Geoffrey Berg
     Berg Feldman Johnson Bell, LLP
     4203 Montrose Boulevard, Suite 150
     Houston, Texas 77006


Appellee:

     Jetall Companies, Inc.




                                    i
Trial and Appellate Counsel for Appellees:

     Mark D. Goranson
     GoransonKing PLLC
     550 Westcott Street, Suite 415
     Houston, Texas 77007

     Mike O’Brien
     Mike O’Brien PC
     14355 Highway 105
     Washington, Texas 77880

     Stephen D. Fox
     2500 West Loop South, Suite 255
     Houston, Texas 77027

     Richard D. Howell
     Buckley, White, Castaneda & Howell, L.L.P.
     2401 Fountainview, Suite 1000
     Houston, Texas 77057




                                      ii
                                    TABLE OF CONTENTS


IDENTITY OF PARTIES AND COUNSEL ................................................................ i

TABLE OF CONTENTS ...................................................................................... iii

INDEX OF AUTHORITIES ................................................................................... v

STATEMENT OF THE CASE ................................................................................ x

STATEMENT REGARDING ORAL ARGUMENT ................................................... xi

ISSUES PRESENTED ........................................................................................ xii

INTRODUCTION ................................................................................................ 1

STATEMENT OF FACTS ..................................................................................... 2

        I.    The Parties’ Contract And Don’s Efforts To Comply With It ....... 2

        II.    Jetall’s Refusal To Close Unless Don And Gayle
               Lowered The Sales Price By At Least $12,000 ............................. 6

        III. The Proceedings Below ............................................................... 11

SUMMARY OF THE ARGUMENT ...................................................................... 16

ARGUMENT .................................................................................................... 18

        I.     Jetall Failed To Prove Lost Profits Damages .............................. 19

              A.       Standard Of Review ........................................................... 19

              B.       Jetall Offered Legally Insufficient Evidence
                       Of Lost Profits .................................................................... 20

              C.       The Lost Profits Award Is Further Suspect
                       Because The Jury Plucked A Figure Out
                       Of Thin Air ......................................................................... 27



                                                      iii
        II.            The District Court Erred By Disallowing A Jury
                       Question On Whether The Holmeses’ Breach
                       Was Excused By Jetall’s Prior Repudiation ........................ 30

                      A.       Standard Of Review ................................................... 30

                      B.       Ample Evidence Supported Don And
                               Gayle’s Position That Jetall Repudiated .................... 31

PRAYER ......................................................................................................... 39

CERTIFICATE OF SERVICE .............................................................................. 41

CERTIFICATE OF COMPLIANCE ....................................................................... 42




                                                        iv
                                  INDEX OF AUTHORITIES

                                                                                                       page
Case

Builders Sand, Inc. v. Turtur,
  678 S.W.2d 115 (Tex. App. – Houston [14th Dist.] 1984) ....................... 32

Callejo v. Brazos Elec. Power Co-op., Inc.,
  755 S.W.2d 73 (Tex. 1988) ................................................................ 27, 28

City of Keller v. Wilson,
  168 S.W.3d 802 (Tex. 2005) .................................................................... 19

CMA-CGM (America), Inc. v. Empire Truck Lines, Inc.,
 416 S.W.3d 495 (Tex. App. – Houston [1st Dist.] 2013, rev. denied) ...... 31

Coastal Transport Co., Inc. v. Crown Cent. Petroleum Corp.,
  136 S.W.3d 227 (Tex. 2004) .................................................. 19, 20, 26, 27

Crown Life Ins. Co. v. Reliable Machine and Supply Co., Inc.,
  427 S.W.2d 145 (Tex. App. – Austin 1968, writ ref’d n.r.e.) ................. 36

Cuidado Casero Home Health of El Paso, Inc. v.
Ayuda Home Health Care Serv., LLC,
  404 S.W.3d 737 (Tex. App. – El Paso 2013) ........................ 21, 23, 25, 26

Cunningham v. Haroona,
  382 S.W.3d 492 (Tex. App. – Ft. Worth 2012, rev. denied) .................... 15

Dror v. Mushin,
  2013 WL 5643407 (Tex. App. – Houston [14th Dist.] 2013,
  rev. denied) ............................................................................................... 36

Dunham and Ross Co. v. Stevens,
  538 S.W.2d 212 (Tex. App. – Waco 1976) .............................................. 32

Elbaor v. Smith,
  845 S.W.2d 240 (Tex. 1992) .................................................................... 30



                                                       v
Estrada v. Cheshire,
   __ S.W.3d __, 2015 WL 4101195
  (Tex. App. – Houston [1st Dist.] July 7, 2015) ......................................... 19

Examination Mgmt. Serv. v. Kersh Risk Mgmt, Inc.,
  367 S.W.3d 835 (Tex. App. – Dallas 2012) ................................. 24, 26, 28

E-Z Mart Stores, Inc. v. Ronald Holland’s A-Plus
Transmission & Automotive, Inc.,
	  	  	  	  358 S.W.3d 665 (Tex. App. – San Antonio 2011, pet. denied)................. 18

First Fed. Sav. & Loan Assoc. of Wilmette, Ill. v. Pardue,
  545 F. Supp. 433 (N.D. Tex. 1982),
  aff’d, 703 F.2d 555 (5th Cir. 1983) ........................................................... 36

First State Bank v. Keilman,
  851 S.W.2d 914 (Tex. App. – Austin 1993, writ denied)......................... 27

Great Pines Water Co. v. Liqui-BoxCorp.,
  203 F.3d 920 (5th Cir. 2000) ..................................................................... 24

Grp. Life and Health Ins. Co. v. Turner,
  620 S.W.2d 670 (Tex. Civ. App. – Dallas 1981) ..................................... 31

Gulf States Utilities v. Low,
  79 S.W.3d 561 (Tex. 2002) ...................................................................... 27

Hampton v. Minton,
  785 S.W.2d 854 (Tex. App. – Austin 1990)............................................. 32

Helena Chem. Co. v. Wilkins,
  47 S.W.3d 486 (Tex. 2001) ...................................................................... 21

Hernandez v. Gulf Grp. Lloyds,
  875 S.W.2d 691 (Tex. 1994) .................................................................... 33

Holt Atherton Indus., Inc. v. Heine,
  835 S.W.2d 80 (Tex. 1992) .................................................... 20, 21, 23, 24




                                                  vi
Humphrey v. Placid Oil Co.,
  142 F. Supp. 246 (E.D. Tex. 1956),
  aff’d, 244 F.2d 184 (5th Cir. 1957) ..................................................... 36, 37

Hunter Bldgs. & Mfg., L.P. v. MBI Global, LLC,
  436 S.W.3d 9 (Tex. App. – Houston [14th Dist.] 2014, rev. denied)........ 23

Hyundai Motor Co. v. Rodriguez,
  995 S.W.2d 661 (Tex. 1993) .................................................................... 30

In re Interest of Doe,
   917 S.W.2d 139 (Tex. App. – Amarillo 1996, writ denied) ..................... 33

Jon-T Farms, Inc. v. Goodpasture, Inc.,
  554 S.W.2d 743 (Tex. App. – Amarillo 1977,
  writ ref’d n.r.e., disapproved on other grounds,
  McKinley v. Drozd, 685 S.W. 2d 7 (Tex. 1985))...................................... 36

Kellmann v. Workstation Integrations, Inc.,
  332 S.W.3d 679 (Tex. App. – Houston [14th Dist.] 2010) ................. 24, 27

Knox v. Taylor,
  992 S.W.2d 40 (Tex. App. – Houston [14th Dist.] 1999) ......................... 29

Lytle Lake Water Control and Imp. Dist. v. Shaw Envtl., Inc.,
  2006 WL 6863698 (N.D. Tex. 2006) ................................................. 35, 36

M & A Technology, Inc. v. iValue Group, Inc.,
  295 S.W.3d 356 (Tex. App. – El Paso 2009, rev. denied) ................. 28, 29

Marriage of Braddock,
 64 S.W.3d 581 (Tex. App. – Texarkana 2001) ........................................ 31

Natural Gas Pipeline Co. of Am. v. Justiss,
  397 S.W.3d 150 (Tex. 2012) .................................................................... 20

Phillips v. Carlton Energy Grp., LLC,
  ___ S.W.3d ___, 2015 WL 2148951 (Tex. May 8, 2015) .................. 21, 22




                                                vii
Phillips v. Phillips,
  820 S.W.2d 785 (Tex. 1991) .................................................................... 28

Powell Elec. Sys., Inc. v. Hewlett Packard Co.,
  356 S.W.3d 113 (Tex. App. – Houston [1st Dist.] 2011) .......................... 29

Preston Reserve, L.L.C. v. Compass Bank,
  373 S.W.3d 652 (Tex. App. – Houston [14th Dist.] 2012) ................. 22, 29

Rusty’s Weigh Scales and Serv., Inc. v. N. Tex. Scales, Inc.,
  314 S.W.3d 105 (Tex. App. – El Paso 2010) ..................................... 23, 24

Saenz v. Martinez,
  2008 WL 4809217 (Tex. App. – San Antonio 2008) ............................... 32

Schroeder v. HB Assoc., LLC,
  2002 WL 1494351 (Tex. App. – Dallas 2002)
  (not designated for publication)................................................................ 27

Sewing v. Bowman,
  371 S.W.3d 321 (Tex. App. – Houston [1st Dist.] 2012,
  rev. dismissed) .......................................................................................... 30

Silver Oak Custom Homes LLC v. Tredway,
   2013 WL 3522916 (Tex. App. – Houston [1st Dist.] 2013) ..................... 15

State v. Hufstutler,
  871 S.W.2d 955 (Tex. App. – Austin 1994)............................................. 29

State ex rel D.L.S.,
  446 S.W.3d 506 (Tex. App. – El Paso 2014) ........................................... 18

Stevens v. Nat’l Education Ctrs.,
   11 S.W.3d 185 (Tex. 2000) (Mem. Op.) .................................................. 31

Superior Broadcast Prod.v. Doud Media Grp., LLC,
  392 S.W.3d 198 (Tex. App. – Eastland 2012).......................................... 25

Szczepanik v. First So. Trust Co.,
  883 S.W.2d 648 (Tex. 1994) .............................................................. 21, 25

                                                     viii
Tabrizi v. Daz-Rez Corp.,
  153 S.W.3d 63 (Tex. App. – San Antonio 2004) ..................................... 27

Taylor v. Trans-Continental Properties, Ltd.,
 739 S.W.2d 873 (Tex. App. – Tyler 1987) ................................................ 22

Texas Instruments, Inc. v. Teletron Energy Mgmt., Inc.,
  877 S.W.2d 276 (Tex. 1994) .................................................................... 21

U.S. Tire-Tech, Inc. v. Boeran, B.V.,
  110 S.W.3d 194 (Tex. App. – Houston [1st Dist.] 2003,
  rev. denied) ............................................................................................... 30



Rules

TEX. R. CIV. P. 278 ....................................................................................... 30

TEX. R. EVID. 401 ......................................................................................... 20




                                                       ix
                       STATEMENT OF THE CASE


Nature of the case:     This is a suit for breach of contract. CR 6-12.1


Trial court and         District Court No. 127, Harris County, Texas; Hon.
Judge:                  Ravi Sandill.


Course of               The case was tried to a jury, which awarded Appellee
Proceedings and         $975,000 in damages as well as attorneys’ fees. App.
Disposition in          Tab 1 (CR 302-16). The trial court entered judgment
the trial court:        on the verdict on January 22, 2015, and later denied
                        Appellants’ post-trial motions. Id. (CR 300-01), CR
                        338).




1
        “CR __” refers to a specific page number in the clerk’s record. “SCR”
refers to the supplemental clerk’s record requested on July 30, 2015. “RR __/___”
refers to a specific volume and page number in the reporter’s record. “App. Tab
__” refers to a specific tab in Appellants’ Appendix.

                                       x
           STATEMENT REGARDING ORAL ARGUMENT


      The Court should hear argument in this appeal. Although the legal

principles are familiar, the facts are somewhat complex, involving a failed

real estate transaction. Moreover, one issue involves whether Appellee is

entitled to a substantial award of lost profits from Appellants, two

individuals, and the Court has traditionally applied a rigorous, fact-intensive

review of such awards. Hence, Appellants respectfully submit that the Court

would benefit from an in-person exploration of the issues at stake in this

appeal with counsel for the parties.




                                       xi
                       ISSUES PRESENTED


1. A jury awarded $900,000 in lost profits to a developer who was

   unable to acquire property needed to build two new townhomes, but

   the developer offered no evidence at all of the applicable real estate

   market or comparable sales, and could only roughly estimate what the

   townhomes would cost to build. An award of lost profits requires

   objective and detailed facts and figures in support, and cannot be

   speculative. Should the award be reversed?



2. Before closing, the developer said it would withhold at least $12,000

   from the property’s $450,000 purchase price because the seller

   supposedly failed to perform certain minor terms of the sales contract.

   There was evidence, however, that this was unjustified and that the

   developer simply wanted to pay less for the land. Should the jury

   have been asked whether the seller’s breach in failing to close the sale

   was excused by the developer’s prior refusal to pay the full sales

   price?




                                  xii
                             INTRODUCTION

      Appellant Don Holmes signed a contract to sell a vacant lot he and his

wife Gayle owned in a residential neighborhood in Houston to Appellee

Jetall Companies for $450,000, but the sale never closed. Jetall sued for

breach and the jury awarded $900,000 for profits supposedly lost when Jetall

was unable to build and sell two townhomes on the property.

      The Court should reverse the lost profits award for legal insufficiency

because the sole evidence propping it up – brief testimony from Ali

Choudhri, a principal in Jetall – falls far short of the exacting requirements

for proving lost profits. Choudhri did not testify about the market for homes

in the applicable neighborhood, comparable sales, what he planned to charge

for the townhomes, why he believed he could sell them and for what, and so

on. Nor did he provide precise and detailed figures about costs, making it

impossible to calculate lost profits with any specificity. Instead, Choudhri

just baldly asserted that Jetall would have netted $1.2 million on the project,

and introduced no corroborating facts, figures or data. To make matters

worse, the jury arbitrarily awarded $900,000 – a sum never mentioned at

trial and 25% less than what Choudhri testified to – for no discernible reason

in the record. Choudhri’s ipse dixit is legally insufficient evidence of lost

profits, and this portion of the award should be reversed.



                                      1
      Reversal is also required by the district court’s refusal to submit a

question on whether Jetall’s prior repudiation or anticipatory breach of the

contract excused Don and Gayle’s breach. Don testified that Choudhri said

Jetall would not pay the full $450,000 purchase price at closing but would

instead withhold $12,000 or $15,000. This was ostensibly to compensate

Jetall for what Choudhri claimed was Don’s failure to perform certain minor

provisions of the contract, such as the duty to replat the property into two

separate lots. But a jury could find that Jetall had no rightful basis to pay

less than the full sales price, and that Choudhri’s expressed reason for doing

so was simply a pretext to obtain the property more cheaply. In that event,

Choudhri’s insistence on paying less than $450,000 at closing was a breach

or repudiation of the contract, and Don and Gayle were entitled to a question

on whether it excused their own failure to close the sale. This error calls for

reversal and a new trial.

                            STATEMENT OF FACTS

      I.     The Parties’ Contract And Don’s Efforts
             To Comply With It

      Don and Gayle own a vacant lot at 1204 Banks Street in Houston as

community property. RR 2/206. In 2011, they decided to sell the property,

initially posting a “for sale by owner” sign on the lot and later exploring a

potential partnership with a friend and developer, Robert Davis, to build


                                      2
townhouses there. RR 2/216-17, 265. Don and Gayle never entered into a

formal agreement with Davis, however, and nothing came of the idea. RR

2/265-66.

       Choudhri is a principal in Jetall Companies, a property development

and management firm. RR 3/25-29. After seeing a “for sale” sign on the

Holmeses’ lot, he inquired about buying it and contacted Don. RR 3/33-40.

They met in Jetall’s offices on October 28, 2011, and Choudhri told Don that

he was interested in building and selling two townhomes on the property.

RR 3/32. Don agreed to sell the lot to Jetall for $450,000, and they executed

a form contract memorializing the sale. RR 3/40-42, 54; App. Tab 2 (Pl.

Exh. 1).

       In addition to its form terms, the sales contract contains five “special

provisions” added to the document by Choudhri during the meeting. App.

Tab 2 (Pl. Exh. 1, ¶ 11); RR 3/43-44. Four of these were warranties that the

property (i) is unrestricted and has no positive or negative easements, (ii) is

not on a fault line, (iii) is “environmentally clean,” and (iv) has no height

restrictions.   Id.   The other special condition states: “Seller to provide

replatting with elec. survey and soil test report.” Id. Closing was to occur

within thirty business days of the title commitment. Id., ( Pl. Exh. 1 ¶ 9).




                                       3
      After Don signed the contract, Choudhri gave him an earnest money

check payable to Declaration Title Company for $10,000, which the title

company later picked up from him along with the contract. RR 2/224-25,

RR 3/54-55, Pl. Exh. 2. The following week, Choudhri transferred $450,000

to the title company in order to facilitate a quick closing, which Don

preferred in light of certain financial problems he was having. RR 3/43, 67-

68; RR 2/245-46; Pl. Exh. 14.

      Don emailed Choudhri a soil report for the property, completed in

1997, a few days after their meeting. Pl. Exh. 10. Although the contract

didn’t require a soil report of any particular age, App. Tab 2 (Pl. Exh. 1 ¶ 11),

Choudhri testified that Don told him at their meeting that the report he

would deliver was only two years old. RR 3/65-66. Choudhri called Don

and they discussed obtaining a new report. RR 3/66-67. But Don later

called the company that had performed the 1997 report and was told a new

one was unnecessary because soil conditions hadn’t changed on the property.

RR 2/269, RR 4/95-96.

      At his October 28 meeting with Choudhri, Don offered to provide an

existing survey he had of 1204 Banks Street. RR 2/270. The following

week, he emailed it in electronic form to the title company but the company

lacked the software to open it. RR 2/257, RR 4/95. Because the survey



                                       4
dated to 1998, it did not reflect a replatting of the property. RR 3/73, 184.

The title company also objected that the survey’s failure to show the lot as

vacant precluded using it for closing.    RR 3/72-73, Pl. Exh. 11.      Don

therefore inquired whether a new survey was necessary, and later emailed

stating that he assumed the title company would order a new one if needed.

Pl. Exh. 13, Pl. Exh. 15, RR 2/257-58. He had previously closed the sale of

a different property using a fifteen year-old survey and so assumed that sale

of the Banks Street lot could proceed using his 1998 survey. RR 2/257-58.

      Don had done most of the work to compete the replatting of the

property, incurring $3,000 in cost, before he entered into the contract with

Jetall because he had previously explored dividing the lot in order to build

townhouses. RR 2/254-56, RR 4/100-01. All that remained was to pay a

$525 fee to the City of Houston and file an application to record the

replatting. RR 2/254-56, 271-72. At their meeting, Don told Choudhri that

he would not finalize the replatting before closing because, if the sale fell

through, a replatting would prevent the Holmeses or another buyer from

doing something different with the property, such as building a single family




                                     5
home or more than two townhouses. Id., RR 4/100-01. Don testified that

Choudhri told him this was fine. RR 2/271-72, 255.2

       II.   Jetall’s Refusal To Close Unless Don And Gayle
             Lowered The Sales Price By At Least $12,000

       In the weeks following their execution of the contract, Don and

Choudhri spoke and emailed about closing the sale and what Choudhri

believed Don still had to do to fulfill the contract’s special provisions. RR

3/72-74, Pl. Exh. 13-18. On November 15, the title company obtained a new

survey of the property at Don’s direction and emailed it to Choudhri, adding:

“The seller is ready to close do you want to do this on Wednesday, Thursday

or Friday of this week.” Pl. Exh. 18, 19.

      Rather than close, however, Choudhri demanded that Don complete

the replatting of the property. Pl. Exh. 20; RR 3/74-75, 82-83. Frustrated by

what he believed were Choudhri’s new demands, Don emailed Choudhri on

November 18, writing:

      Ali

      I am not sure what is going on. When we were working on an
      agreement I told you I had an old electronic survey but that
      would be an advantage for your designer. Additionally we
      discussed that I had started getting the lot replated [sic] but that

2
       There was also testimony at trial that the Holmes lot may have had an
easement toward the back of the property in violation of the seller’s warranty of no
easements, but Choudhri confirmed that this was not a material concern. RR
3/220.

                                         6
      had not been filed so it would not impact your desire to build a
      single family home on the lot. Thirdly, I offered a soil test that
      I had performed a few years ago to you. After you later refused
      to accept the electronic survey, I had a new survey done which
      showed the lot as vacant and undivided. Now I am told you
      want the lot replated [sic], which is new, and that the soil
      surveys are old, which was known. I assume you are having
      buyers [sic] remorse and wish that you had purchased the other
      lot you were considering. I certainly have no interest in trying
      to sell something to someone that doesn’t want it so I think it is
      probably best that we just back away and you can pursue the
      other location.

Pl. Exh. 21. Don also called the title company and learned for the first time

that Choudhri had instructed the company to deduct $12,000 from the price

to be paid at closing. RR 4/96.

      On December 12, Choudhri emailed and hand-delivered a letter to

Don stating that Jetall “looks forward” to closing the sale on December 15.

Pl. Exh. 24. The letter asserted that Don had not replatted the property or

provided an electronic survey or soil report; demanded performance of these

tasks; and indicated that Jetall “is entitled to specific performance as well as

other relief under law, such as damages and attorney’s fees” for Don’s

supposed noncompliance. Id. “Notwithstanding the forgoing,” however, the

letter stated that Jetall would attend the closing on December 15 while

reserving its rights under the contract. Id.

      The next day, Choudhri emailed Don with a similar message, asking

“please let me know if you intend to honor the contract and all terms we


                                       7
entered into?” Pl. Exh. 23. The email asked whether Don would provide a

completed replatting, electronic survey, and soil report – or if not, “will you

offset the costs for me off the sales price?” Id. Choudhri asserted that “[t]he

estimated costs” for these items “is at least $12,000 plus the time and

carrying costs of doing do [sic].” The email concluded:

      If you need more time to complete these items I am amenable to
      extended [sic] the contract to allow you to complete.
      Alternatively, I am willing to accommodate you and close and
      fund the transaction December 15, 2011 as long as you credit
      me at least $12,000 for the cost of accomplishing these items at
      closing.

      I am trying my best to resolve this matter at hand before it is
      escalated.

      Please reply by 10:00 am December 14, 2011.

Id. Although Choudhri wrote that the soil report, replatting, and survey cost

“at least $12,000,” he later acknowledged that he did not actually know the

exact price of performing these tasks. RR 4/61-62.

      Don went to Jetall’s offices to meet with Choudhri on December 13 in

an effort “to resolve the issues and close.” RR 3/6. According to Don,

Choudhri told him during this meeting that he would close on the sale but

would deduct $15,000 or $12,000 from the $450,000 purchase price in order

to complete the disputed items Choudhri claimed had not been performed.

RR 2/272-73; RR 3/11, 23; RR 4/102-03. As Don testified:



                                      8
      What happened, on Tuesday the 13th, I went by his office in an
      attempt to negotiate some kind of settlement that we could
      conclude the transaction and at that point in time we discussed
      – you know, I told him that I wasn’t going to pay more for the
      items that he wanted to charge me. I think that during the day
      he said $15,000 but I see that he was back down to $12,000, but
      the amount kind of varied.

             But he was going to take off for these items and I said
      that I had given him what I promised and that was what I had
      already developed or what I had already purchased and all I was
      giving him was old documents. I didn’t – had never agreed to
      any of the new ones and that if we were going to close, that I
      wanted the full amount. And he told me that he was losing
      money by not being able to move ahead and that he was going
      to sue me and if I didn’t close immediately, I better get a lawyer.
      And this was the most threatening he had been and I had just
      gone to his office trying to resolve it.

RR 4/102-03. A title company employee also told Don that $15,000 of the

price would be placed in escrow, and Choudhri told Don that Don would be

unable to access these funds until Choudhri “fe[lt] like it.” RR 2/272-73.

      Gayle objected to the special provisions in the contract and to

consummating the deal under the agreement Don signed. RR 2/274, RR 3/7,

RR 4/77-79. Nonetheless, they were ready to close on December 13 and

would have willingly done so but for Choudhri’s demand to lower the

purchase price. RR 4/106, RR 3/11. They also feared “that even if we

conceded the $15,000, that he was going to come back again on other – on

the other points. It was just going to be an ongoing dilemma of trying to get

money from him.” RR 2/274.


                                      9
       Choudhri gave a different account of the parties’ December 13

meeting, testifying that Don asked to increase the sales price and that the

discussion ended when Choudhri told him “We have a deal” and that he was

“not even going to entertain” a higher price. RR 3/97. Choudhri testified

that, in fact, Jetall would have closed the sale on December 15 without

further action by the Holmeses, and without deducting anything from the

$450,000 sales price. RR 3/98-105, RR 4/64-65. He denied demanding

anything from Don. RR 4/64. As Choudhri put it: “to get the deal closed,

he [Don] didn’t even have to do anything more under my letter to him. He

just had to come and sign and close… Sign the deed and take his funds and

it was our reservation if we wanted to go after him later and we wouldn’t

have.” RR 3/98-99, 127, 185-86. Still, Choudhri acknowledged that he

never told Don he would not sue for alleged breach of the special provisions

after the sale closed. RR 3/181-82.

       On December 14, Don emailed Choudhri in response to Choudhri’s

December 13 email and communicated that he had an appointment with his

lawyer that morning and that he still “would like to work this out and [g]et

the deal done but I do need to talk to my attorney before going forward.” Pl.

Exh. 25.   A week later, Jetall’s lawyer wrote Don demanding that the

Holmeses close by December 31. Pl. Exh. 29. The letter reprised the claim



	                                    10
that Don was obligated to comply with the special provisions but stated that,

if he chose not to, Jetall “would be willing” to deduct their cost from them at

closing, and that the cost was estimated to be $12,000. Id. The letter

warned that Jetall would file suit if no closing occurred and invited Don to

request a copy of Jetall’s draft petition (though one was actually included

with the letter). Id., RR 4/81.

      On January 5, Don’s attorney wrote Jetall’s lawyer and agreed to

close the sale if the original contract was declared null and void and the

parties released each other from any liabilities under it, if the purchase price

was increased to $456,000, and if Jetall paid outstanding ad valorem taxes

on the property. Pl. Exh. 30. The Holmeses increased the purchase price by

$6,000 in this offer to cover fees they had to pay their attorney while dealing

with Jetall. RR 3/10-11. The parties then stopped negotiating, and the sale

was never completed.

      III.   The Proceedings Below

      Jetall sued Don and Gayle and their community property estate for

breach of contract and fraud, seeking damages and specific performance.

CR 6-12. The case eventually proceeded to a jury trial.

      At trial, Choudhri argued that he had wanted to close the sale on

December 15 and would not have deducted any funds from the purchase



                                      11
price at closing. RR 3/95-105. As for damages, Choudhri testified as

Jetall’s expert witness on the topic. CR 17, RR 5/9. He claimed that the

profit Jetall would have reaped on the sale of the two townhomes planned

for the lot “would have been in excess of $1.2 million.” RR 3/122. Jetall

offered an exhibit (Exhibit 36) its counsel called a “pro forma” for the

project, including “calculations of the cost, expenses… [and] profitability”

of the planned development, but the document was never admitted. RR

3/115-17, 133-34.    On cross-examination, Choudhri gave the following

testimony about what it would cost to build the townhomes:

      Q.    And you previously told me it would have cost you
            approximately $850,000 in cost to build those homes,
            correct?

      A.    I don’t recall what I told you, but if – the numbers are
            about $800,000 per home. If you’re saying it’s 850, I
            know my depo was about a year ago; so I don’t know if I
            – I can’t recall exactly, but close, yes sir.

      Q.    North of $800,000 it was going to cost you to build these
            homes, correct?

      A.    Yes.

RR 3/125-26. Other than that, Jetall offered no evidence about expenses

connected to the project. RR 3/115-26.

      Choudhri did not testify about how long construction would take,

when the homes would be for sale, what the real estate market was like then,



                                    12
what other comparable townhomes near 1204 Banks Street were selling for,

or any other data about Jetall’s planned development. Id. He testified

generally that buyers were interested in Jetall’s homes, RR 3/29-32, 84, and

he stated that his sister initially wanted one of the townhouses planned on

the Holmes lot. RR 3/32. But Choudhri gave no more no more specific

information about the likelihood of selling the townhomes, what he planned

to charge for them, how many buyers might be available, what and whether

they could pay, and so forth. RR 3/115-26. In addition to lost profits, Jetall

sought to recover the claimed rise in the value of the land. RR 4/163-64.

      Don and Gayle defended against Jetall’s claim for breach by arguing

that the company breached first when Choudhri told Don that Jetall would

withhold $12,000 or $15,000 from the purchase price under the pretext that

Don failed to complete the special provisions.       RR 2/192-93.      Gayle,

represented by separate counsel, also defended by arguing that she never

signed the contract or ratified it, that Don did not act as her agent in the

transaction, and that the contract was therefore void given Don’s incapacity

to sell their community property on his own. RR 2/186-87, 192. Thus,

much of the trial testimony concerned whether Gayle intended to enter into

the contract with Jetall and authorized Don to act for her. The Holmeses




                                     13
also argued that Choudhri failed to substantiate Jetall’s damages for lost

profits. RR 4/181.

      The parties began discussing the charge before testimony concluded

on the last day of trial. The district court indicated that he would find that

Jetall waived performance of the special provisions as a matter of law, but

that Jetall could not have committed breach because Choudhri had

previously transferred the purchase price to the title company. RR 4/4-10.

“So once the 450 is at the title company,” the court stated, “he can’t breach.”

RR 4/9. When Gayle’s counsel objected that Choudhri had instructed the

title company to withhold part of the sales proceeds due to Don’s supposed

failure to have completed the replatting process, the court responded:

“There’s no evidence of that,” and added: “The issue in this case is at the

time of closing was the land conveyed. Nothing else matters.” RR 4/12-13.

      At the charge conference later that day, Don and Gayle’s counsel

requested a question on whether their breach was excused by Jetall’s prior

anticipatory breach, that is, Choudhri’s stated intention to withhold at least

$12,000 from the purchase price to compensate for supposed non-

performance of the special provisions.      RR 4/118-120, 127; SCR (Jury

Question No. 4). Consistent with its earlier comments, the court refused,

finding that there was no fact question on the issue and that, as a matter of



                                      14
law, the Holmeses breached the contract but Jetall did not. RR 4/119, 127,

131.3 As a result, the charge did not include questions on whether either

party breached or whether any breach by Don and Gayle was excused by

Jetall’s prior anticipatory breach or repudiation. App. Tab 1 (CR 306-16).

       The jury found that Gayle authorized Don to enter into the contract,

and that the Holmeses did not commit fraud. Id. It awarded $75,000 in

breach of contract damages for the difference in the value of the property,

and $900,000 in damages for Jetall’s lost profits. Id. (CR 308). The jury

also awarded Jetall $52,800 in attorneys’ fees through trial, and additional

fees if the company prevails on appeal. Id. (CR 314). The court later

entered judgment on the jury’s verdict. Id. (CR 300-01).

       Don and Gayle timely moved for a new trial, to disregard the jury’s

findings, and for judgment notwithstanding the verdict based on the trial


3
        In later colloquy, the court stated that Gayle could not request an
anticipatory breach question while also asking the jury to decide whether Don was
authorized to agree to the sale on her behalf. RR 4/129-30. The court evidently
thought that an anticipatory breach question would mean Gayle was “admitting
that she’s party to the contract,” thus conceding the authority issue. RR 4/130. In
fact, parties may place alternative theories before the jury. See Silver Oak Custom
Homes LLC v. Tredway, 2013 WL 3522916 at * 5 (Tex. App. – Houston [1st Dist.]
2013). Faced with this erroneous ruling and the unnecessary choice imposed by
the court, Gayle indicated she was withdrawing her request for an anticipatory
breach question. RR 4/130. Nevertheless, her earlier objection notified the court
of the issue and thereby preserved the point for appellate review. See, e.g.,
Cunningham v. Haroona, 382 S.W.3d 492, 510 (Tex. App. – Ft. Worth 2012, rev.
denied) (“The trial court clearly understood [plaintiff’s] complaint, and this is all
that was required”).

                                         15
court’s refusal to submit a question on breach and excused performance and

the lack of evidence of lost profits. CR 317-26. At the hearing on the

motion, the court reiterated: “I found as a matter of law that there was a

breach” by Don and Gayle. RR 5/4. On the issue of lost profits, the court

dismissed the Holmeses’ argument that, among other failings, Choudhri

never testified to the cost of building the townhomes by stating: “Everyone

knows, I mean, you go to a builder today, they’ll build you a house for $150

a square foot. They’ll tell you that, correct?” RR 5/7. Jetall defended

Choudhri’s testimony on the basis that he was qualified as an expert to opine

on the topic. RR 5/9. The court denied the motion. CR 338.

                       SUMMARY OF ARGUMENT

      First, there is legally insufficient evidence of Jetall’s lost profits.

Choudhri testified that the failure to acquire the land and build and sell two

townhouses cost Jetall $1.2 million in profits, but little besides his ipse dixit

supports the claim. Choudhri did not testify at all about the relevant real

estate market at the relevant time. The record is silent on comparable sales

near 1204 Banks at whatever time Jetall expected to finish the project

(Choudhri didn’t say), what Jetall intended to charge for the townhomes,

whether sales could have been achieved and why, what buyers might have

paid, and so forth. Without this kind of basic evidence, Jetall’s claim is



                                       16
entirely speculative. Moreover, claims for lost profits must be supported by

objective and detailed facts, figures and data, but Jetall introduced none of

this. Choudhri gave only a rough estimate of what building the homes

would cost, but the lack of specificity makes it impossible to tally Jetall’s

damages with any precision. On top of all that, the jury ignored Jetall’s

evidence and its request for $1.2 million and randomly awarded only

$900,000, though no evidence at all supports this figure and it was never

mentioned by anyone at trial. Given the lack of any evidentiary basis for the

jury’s award, it should be reversed. See Point I, infra.

      Second, the Court should reverse the judgment because the trial court

erred in declining to submit a question on whether Jetall’s prior repudiation

or anticipatory breach of the contract excused Don and Gayle’s breach.

Choudhri told Don that Jetall would withhold $12,000 or $15,000 from the

purchase price at closing. Title company employees in communication with

Choudhri said the same thing. Choudhri’s reason for this was Don’s claimed

nonperformance of the special provisions, but a jury could find that this was

just an excuse to pay less for the lot. The trial court decided that Jetall

waived performance of the special provisions as a matter of law, and a jury

could have found that they were non-material. Moreover, Don performed

these terms adequately, and no evidence in the record supports the claim that



                                      17
Jetall would have incurred as much as $12,000 or $15,000 to take care of

them after closing. As a result, a jury could have determined that Jetall’s

insistence on withholding such a substantial portion of the sales price was an

anticipatory breach or repudiation of the contract that excused the Holmeses’

later failure to close the sale, and the court consequently should have

included a question on this issue in the charge. Its failure to do so mandates

reversal. See Point II, infra.

                                 ARGUMENT

      Don and Gayle urge reversal on two grounds: insufficiency of the

evidence supporting lost profits damages, and the trial court’s erroneous

failure to include a question for the jury on whether the Holmeses’ breach of

contract was excused. Because the legal insufficiency point would require

rendition and should therefore be decided first, it is addressed first in this

brief. See State ex rel D.L.S., 446 S.W.3d 506, 519 (Tex. App. – El Paso

2014) (“Where the finding is legally insufficient, reversal and rendition are

the proper remedies”); E-Z Mart Stores, Inc. v. Ronald Holland's A-Plus

Transmission & Automotive, Inc., 358 S.W.3d 665, 670 (Tex. App. – San

Antonio 2011, pet. denied) (“Because legal sufficiency is a rendition issue,

we must address it before addressing issues that would require a remand”).




                                     18
      I.     Jetall Failed To Prove Lost Profits Damages

             A.     Standard Of Review

      A jury’s finding is legally insufficient and must be reversed “if the

record shows: (1) that a vital fact is completely absent; (2) that the court is

barred by rules of law or evidence from giving weight to the only evidence

offered to prove a vital fact; (3) that the evidence offered to prove a vital fact

is not more than a scintilla; or (4) that the evidence establishes conclusively

the opposite of the vital fact.” Estrada v. Cheshire, __ S.W.3d __, 2015 WL

4101195 at * 6 (Tex. App. – Houston [1st Dist.] July 7, 2015) (citing City of

Keller v. Wilson, 168 S.W.3d 802, 810 (Tex. 2005)). The Court should

consider the evidence in the light most favorable to the finding under review

and indulge all reasonable inferences that would support the finding. See

City of Keller, 168 S.W.3d at 822.

      Findings supported only by conclusory expert or lay opinion

testimony must also be reversed. “[A]lthough expert opinion testimony

often provides valuable evidence in a case, it is the basis of the witness’s

opinion, and not the witness’s qualifications or his bare opinions alone, that

can settle an issue as a matter of law; a claim will not stand or fall on the

mere ipse dixit of a credentialed witness.” Coastal Transport Co., Inc. v.

Crown Cent. Petroleum Corp., 136 S.W.3d 227, 232 (Tex. 2004) (quotation


                                       19
omitted). Thus:

      Opinion testimony that is conclusory or speculative is not
      relevant evidence, because it does not tend to make the
      existence of a material fact “more probable or less probable.”
      See TEX. R. EVID. 401. This Court has labeled such testimony
      as “incompetent evidence,” and has often held that such
      conclusory testimony cannot support a judgment. Furthermore,
      this Court has held that such conclusory statements cannot
      support a judgment even when no objection was made to the
      statements at trial.

Id. (citations omitted). The Supreme Court has specifically singled out lost

profits testimony by business owners as the sort of opinion or quasi-expert

testimony governed by this rule. See Natural Gas Pipeline Co. of Am. v.

Justiss, 397 S.W.3d 150, 157 (Tex. 2012) (“We have also recognized that a

business owner’s conclusory or speculative testimony of lost profits will not

support a judgment,” citing Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d

80, 84 (Tex.1992)).

            B.     Jetall Offered Legally Insufficient Evidence Of Lost
                   Profits

      Jetall’s sole evidence of lost profits consisted of brief testimony from

Choudhri.   The company also offered a document supposedly detailing

“calculations of the cost, expenses… [and] profitability” of the townhomes,

but it was not admitted.     RR 3/115-17, 133-34.       Because Choudhri’s

testimony on this subject was purely speculative and self-serving rather than

a factual account rooted in objective data, that portion of the award must be


                                     20
reversed.

      Lost profits must be shown with “reasonable certainty.”          Helena

Chem. Co. v. Wilkins, 47 S.W.3d 486, 505 (Tex. 2001). “As a minimum,

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.” Phillips v.

Carlton Energy Grp., LLC, ___ S.W.3d ___, 2015 WL 2148951 at * 10 (Tex.

May 8, 2015) (quoting Holt Atherton Indus., 835 S.W.2d at 84). Moreover,

“[t]he record must show how the lost profits were calculated.” 	   Cuidado

Casero Home Health of El Paso, Inc. v. Ayuda Home Health Care Serv.,

LLC, 404 S.W.3d 737, 744 (Tex. App. – El Paso 2013); see also Szczepanik

v. First So. Trust Co., 883 S.W.2d 648, 650 (Tex. 1994) (“There is nothing

in the record to show how FST determined the amount of lost profits”).

“Profits which are largely speculative, as from an activity dependent on

uncertain or changing market conditions… cannot be recovered.” Phillips,

2015 WL 2148951 at * 10 (quoting Texas Instruments, Inc. v. Teletron

Energy Mgmt., Inc., 877 S.W.2d 276, 279 (Tex. 1994)).

      In this case, Jetall’s scant evidence of lost profits is both speculative

and lacking the objective data needed to justify an award. The claim is

speculative because Choudhri provided no information at all about the real

estate market in Houston at the time he would supposedly be selling the



                                      21
townhomes he planned to build. RR 3/115-24. In fact, he did not even say

when he expected to complete any sale of the townhomes – that is, how long

it would take to construct them, how long they might be on the market, and

how long it would take to complete a sale. Nor did Jetall introduce evidence

of what other similar homes near 1204 Banks Street sold for at any time, let

alone at or near the time he expected to offer the townhomes on the Holmes

lot for sale.

       Obviously, the market for real estate fluctuates based on a wide

variety of factors. See, e.g., Preston Reserve, L.L.C. v. Compass Bank, 373

S.W.3d 652, 667 (Tex. App. – Houston [14th Dist.] 2012); Taylor v. Trans-

Continental Properties, Ltd., 739 S.W.2d 873, 881 (Tex. App. – Tyler 1987).

Conditions in the market may be “uncertain or changing,” Phillips, 2015 WL

2148951 at * 10, in light of the wider economy, the dynamics of a particular

neighborhood, the level of supply, and many other considerations. Neither a

robust nor an anemic market can simply be assumed by the parties or the

factfinder.     Without knowing the condition or specifics of the relevant

market at the relevant time, it is impossible to know if the townhomes likely

would have sold, or for how much.           Claiming that a sale would have

generated $1.2 million in profits is therefore entirely speculative.

       Choudhri did generically refer to having unspecified “buyers” for the



                                       22
townhomes. RR 3/29-32, 84. He identified one of these as his sister, though

she later became uninterested in the project and it is unclear if she would

have paid the market rate as a buyer when her family’s own company was

the seller. CR 2/32. Again, Choudhri did not say. Id. No other potential

buyer was named. Yet “[t]he bare assertion that contracts were lost does not

demonstrate a reasonably certain, objective determination of lost profits.”

Hunter Bldgs. & Mfg., L.P. v. MBI Global, LLC, 436 S.W.3d 9, 17 (Tex.

App. – Houston [14th Dist.] 2014, rev. denied); accord Holt Atherton Indus.,

835 S.W.2d at 85; Cuidado Casero Home Health, 404 S.W.3d 744. Lost

profits must be non-speculative and corroborated.” Cuidado Casero Home

Health, 404 S.W.3d 745 (emphasis added); accord Rusty’s Weigh Scales and

Serv., Inc. v. N. Tex. Scales, Inc., 314 S.W.3d 105, 111 (Tex. App. – El Paso

2010). It is insufficient to assert baldly that buyers or customers were lost

without providing corroborative detail and proof, such as the buyers’

identities, evidence that they had firmly agreed to buy, proof that their loss

or cancellation is the defendant’s fault rather than the result of other market

forces, information about the transactions that had to be cancelled (such as

pricing), and so on.

      For example, a company seeking $2 million in lost profits due to a

former employee’s theft of trade secrets asserted that the theft led to a loss of



                                       23
buyers, but it failed to offer proof that it had actual contracts lined up or that

customers hadn’t switched for other reasons. See Rusty’s Weigh Scales, 314

S.W.3d at 111. The mere assertion that unspecified customers defected was

not enough. See id. Likewise, in Great Pines Water Co. v. Liqui-BoxCorp.,

a business owner testified that a supplier’s malfunctioning equipment

resulted in 4,000 lost customers based on his observations of the company’s

plant, talking to the company’s drivers, and “conversations with an unknown

number of customers who complained.” 203 F.3d 920, 923 (5th Cir. 2000).

But the lack of hard proof that 4,000 customers actually discontinued service

and why doomed any claim for lost profits. See id. For the same reasons,

Choudhri’s blanket, uncorroborated statement that he had buyers for the

townhomes cannot, without more, justify an award of lost profits.

      Jetall’s bid for $1.2 million in lost profits is not only speculative, it

lacks the necessary supporting, “objective facts, figures, or data.” Holt

Atherton Indus., 835 S.W.2d at 84. Plaintiffs seeking lost profits must detail

the expenses of the work or project they claim would have yielded the profit.

See Examination Mgmt. Serv. v. Kersh Risk Mgmt, Inc., 367 S.W.3d 835,

843 (Tex. App. – Dallas 2012) (faulting plaintiff’s failure to “enumerate

costs”);	  Kellmann v. Workstation Integrations, Inc., 332 S.W.3d 679, 685-86

(Tex. App. – Houston [14th Dist.] 2010). Yet Choudhri barely referred to



                                       24
expenses at all. He ignored the subject entirely during his direct testimony.

RR 2/115-24. Questioned in cross examination about the costs of building

the townhomes, he stated that “the numbers are about $800,000 per home,”

then agreed that it was actually “close” to $850,000 (the figure he gave in his

deposition), then agreed it was “north of $800,000.” RR 2/125-26. He

provided no supporting detail or back-up documentation at all, such as

evidence showing what specific items in the budgets for construction and

marketing would have cost. “Rough estimates” cannot support recovery, but

Choudhri offered nothing more. Superior Broadcast Prod.v. Doud Media

Grp., LLC, 392 S.W.3d 198, 212 (Tex. App. – Eastland 2012).

      It is impossible to determine precisely “how [Jetall’s] lost profits were

calculated” in the absence of specific, exact evidence of expenses. Cuidado

Casero, 404 S.W.3d at 744; Szczepanik, 883 S.W.2d at 650. The trial court

appears to have let Jetall off the hook on this score because “[e]veryone

knows, I mean, you go to a builder today, they’ll build you a house for $150

a square foot.” RR 5/7. But presumed common knowledge about building

costs is no substitute for actual, admitted evidence a fact-finder could

properly have used to calculate the profits Jetall claims to have lost.

      Equally problematic, Choudhri never testified to what he would

charge for the townhouses. When Jetall designated him as an expert witness,



                                       25
it stated that “[e]ach townhouse would have sold for at least $400,000.” CR

18. But if it cost $800,000 or $850,000 to build each townhome, Jetall

would have lost approximately $400,000 on each and earned no profit at all

with anything close to a $400,000 sales price. How and why these figures

changed radically between Choudhri’s expert designation and trial, such that

Choudhri claimed the company would have made $1.2 million, is a mystery.

      Lacking concrete and objective facts and figures, all that remains are

Choudhri’s qualifications and his “take my word for it” figure of $1.2

million. Don and Gayle have never questioned that, given his experience in

real estate development, Choudhri could opine on Jetall’s lost profits. RR

5/9. But what matters is the basis of his opinion, not his “qualifications or

his bare opinions alone… [A] claim will not stand or fall on the mere ipse

dixit of a credentialed witness.” Coastal Transport, 136 S.W.3d at 232.

Choudhri testified at length about his credentials, RR 2/117-19, but he failed

to go much beyond his background as a developer and adequately support

his opinion about this specific project. Courts have repeatedly reversed lost

profits awards based on nothing more than an expert’s or business owner’s

say so – cases where the plaintiff’s witness testified to a net amount but

failed to provide detailed supporting evidence. See, e.g., Cuidado Casero,

404 S.W.3d at 745-46; Examination Mgmt. Serv., 367 S.W.3d at 839-44;



                                     26
Tabrizi v. Daz-Rez Corp., 153 S.W.3d 63, 68 (Tex. App. – San Antonio

2004); Schroeder v. HB Assoc., LLC, 2002 WL 1494351 at * 3 (Tex. App. –

Dallas 2002) (not designated for publication). This case is no different, and

Choudhri’s conclusory opinion testimony is “incompetent evidence” that

cannot justify the jury’s award. Coastal Transport, 136 S.W.3d at 232.

      “When a review of the surrounding circumstances establishes that the

profits are not reasonably certain, there is no evidence to support the lost

profits award.” Kellmann, 332 S.W.3d at 684. The Court should therefore

reverse the $900,000 award.

             C.    The Lost Profits Award Is Further Suspect Because
                   The Jury Plucked A Figure Out Of Thin Air

      The jury’s decision to award $900,000 in lost profits – when Choudhri

testified that the sum was actually $1.2 million – further illustrates its legal

insufficiency.

      “In determining damages, the jury has discretion to award damages

within the range of evidence presented at trial.” Gulf States Utilities v. Low,

79 S.W.3d 561, 566 (Tex. 2002). But jurors may not “arbitrarily assess an

amount neither authorized nor supported by the evidence presented at trial.

In other words, a jury may not ‘pull figures out of a hat’; a rational basis for

calculation must exist.” First State Bank v. Keilman, 851 S.W.2d 914, 930

(Tex. App. – Austin 1993, writ denied); accord Callejo v. Brazos Elec.


                                      27
Power Co-op., Inc., 755 S.W.2d 73, 75 (Tex. 1988) (jurors may not “leap

entirely outside of the evidence” and award a sum unsupported by proof).

This rule is particularly apt in breach of contract cases, where damages

should neither exceed nor understate the loss. See Phillips v. Phillips, 820

S.W.2d 785, 788 (Tex. 1991) (“The universal rule for measuring damages

for the breach of a contract is just compensation for the loss or damage

actually sustained. By the operation of that rule a party generally should be

awarded neither less nor more than his actual damages” (quotation omitted)).

      In this case, however, the jury did not award Jetall the only sum that

Choudhri tried to justify at trial and which Jetall’s lawyer argued for in

closing: $1.2 million. RR 4/165. Rather, the jury inexplicably awarded

$900,000 in lost profits. There is no basis in the record whatsoever for

determining that Jetall’s lost profits were $900,000. Jurors may have chosen

to lop off a quarter of what Jetall requested for some reason known only to

them, but the $900,000 figure does not appear in any testimony or document.

When juries deviate dramatically from the damages proven at trial – whether

by awarding too much or too little – reversal is necessary.        See, e.g.,

Examination Mgmt. Serv., 367 S.W.3d at 844 (reversing lost profits award in

part because it was $8,262 less than the amount indicated by plaintiff’s

evidence); M & A Technology, Inc. v. iValue Group, Inc., 295 S.W.3d 356,



                                     28
368 (Tex. App. – El Paso 2009, rev. denied) (award higher than range

supported by evidence); Preston Reserve,	   373 S.W.3d at 667 (“It follows

that the trial [court] was not authorized to find that the property's value was

$2.4 million when the only competent evidence presented at trial supports a

fair market value of at least $2.7 million”); State v. Hufstutler, 871 S.W.2d

955, 959-60 (Tex. App. – Austin 1994) (same).

      True, “[e]vidence corresponding to the exact amount found by the

trier of fact is not essential,” and juries can pick a figure that falls on a

spectrum supported by the evidence.        Powell Elec. Sys., Inc. v. Hewlett

Packard Co., 356 S.W.3d 113, 126 (Tex. App. – Houston [1st Dist.] 2011).

The jury may also sometimes blend conflicting expert testimony to arrive at

a proper figure. See Knox v. Taylor, 992 S.W.2d 40, 63 (Tex. App. –

Houston [14th Dist.] 1999). But here, Choudhri did not testify that Jetall’s

profits would fall within a particular range; he claimed simply that the

company lost $1.2 million. RR 3/115-24. Nor did Don and Gayle offer

expert testimony of some lower amount that might permit the jury to blend

the two contrasting views and somehow arrive at $900,000. Moreover, the

jury did not stray only slightly from the evidence. It unaccountably reduced

Jetall’s claimed amount by a full 25%. In these circumstances, the jury’s

arbitrary award lends further support to Don and Gayle’s argument that it is



                                      29
devoid of record support and thus legally insufficient.

      II.    The District Court Erred By Disallowing A Jury Question
             On Whether The Holmeses’ Breach Was Excused By
             Jetall’s Prior Repudiation

             A.    Standard Of Review

      “In its charge to the jury, a trial court must submit all questions,

instructions, and definitions raised by the pleadings and evidence. TEX. R.

CIV. P. 278; Hyundai Motor Co. v. Rodriguez, 995 S.W.2d 661, 663

(Tex.1999).” U.S. Tire-Tech, Inc. v. Boeran, B.V., 110 S.W.3d 194, 202

(Tex. App. – Houston [1st Dist.] 2003, rev. denied). “A trial court may

refuse to submit an issue only if no evidence exists to warrant its

submission.” Id. (citing Elbaor v. Smith, 845 S.W.2d 240, 243 (Tex.1992)).

“Conflicting evidence presents a fact question for the jury to decide.”

Sewing v. Bowman, 371 S.W.3d 321, 339 (Tex. App. – Houston [1st Dist.]

2012, rev. dismissed).

      In this case, Don and Gayle requested submission of a question asking

whether their non-performance of the contract – failure to close the sale of

the property – was excused by Jetall’s prior anticipatory breach or

repudiation, but the court refused. RR 4/118-20, 127; SCR (Jury Question

No. 4). As a result, this Court should examine the record for any evidence

supporting the Holmeses’ defense of excuse, and if it exists, reverse and



                                      30
remand for a new trial. See Stevens v. Nat’l Education Ctrs., 11 S.W.3d 185

(Tex. 2000) (Mem. Op.) (remand for new trial is remedy for charge error).

             B.     Ample Evidence Supported Don And Gayle’s Position
                    That Jetall Repudiated

      Don and Gayle presented more than enough evidence that Jetall

committed an anticipatory breach or repudiation by using a demand for

performance from the Holmeses beyond that required under the agreement

as cover for withholding $12,000 to $15,000 from the purchase price. This

anticipatory breach excused Don and Gayle’s own breach of refusing to

close the sale. Given the evidence in the record supporting this theory, the

trial court should have submitted the issue to the jury.

      “The terms ‘repudiation’ and ‘anticipatory breach’ are used somewhat

interchangeably by our courts.” Grp. Life and Health Ins. Co. v. Turner, 620

S.W.2d 670, 673 (Tex. Civ. App. – Dallas 1981). They refer to one party’s

“positive and unconditional refusal to perform the contract in the future,

expressed either before performance is due or after partial performance. It is

conduct that shows a fixed intention to abandon, renounce, and refuse to

perform the contract.” CMA-CGM (America), Inc. v. Empire Truck Lines,

Inc., 416 S.W.3d 495, 519 (Tex. App. – Houston [1st Dist.] 2013, rev.

denied). The intent to repudiate may be expressed through either words or

actions. See Marriage of Braddock, 64 S.W.3d 581, 585 (Tex. App. –


                                      31
Texarkana 2001); Builders Sand, Inc. v. Turtur, 678 S.W.2d 115, 120 (Tex.

App. – Houston [14th Dist.] 1984). When one party repudiates, the other

party’s performance is excused. See Hampton v. Minton, 785 S.W.2d 854,

857 (Tex. App. – Austin 1990); accord Saenz v. Martinez, 2008 WL

4809217 (Tex. App. – San Antonio 2008); Dunham and Ross Co. v. Stevens,

538 S.W.2d 212, 216 (Tex. App. – Waco 1976).

      Don testified that, at his meeting with Choudhri on December 13,

2011, Choudhri told him he would deduct $15,000 or $12,000 from the

$450,000 purchase price of the property – ostensibly because Don had not

completed the special provisions. RR 2/272-73; RR 3/11, 23; RR 4/102-03.

Don also testified that title company employees told him that $15,000 of the

funds wired to the company for closing would be placed in escrow, and that

Don could not access these funds until Choudhri “fe[lt] like it.” RR 2/272-

73. Another title company employee told him that Choudhri would deduct

$12,000 from the price to be paid at closing. RR 4/96. This evidence

establishes that Jetall decided not to perform the contract by paying the

required $450,000 purchase price, but instead resolved to pay no more than

$435,000 or $438,000 for the property. If credited by a jury, it excuses Don

and Gayle’s failure to go through with the closing, since they were not




                                    32
obliged to part with the lot for less than Choudhri agreed to when the

contract was signed.

      According to Don, Choudhri justified his insistence on lowering the

purchase price by claiming that Don failed to complete the special

provisions, but a jury could find that this was nothing more than a pretext to

pay less than the contract required. After all, Choudhri testified that he

wanted to close the sale regardless of Don’s supposed non-performance, that

he would have done so on December 15, and that he would not have sued for

reimbursement afterward. RR 3/98-105, 127, 185-86; RR 4/64-65. Indeed,

the trial court found that Jetall waived performance of the special provisions

as a matter of law. RR 4/4, 9. A jury could therefore have found that they

were not material elements of the Holmeses’ performance, that Jetall was

therefore obligated to pay the full purchase price at closing, and that

demanding to pay significantly less based on the special provisions

constituted repudiation. See Hernandez v. Gulf Grp. Lloyds, 875 S.W.2d

691, 692-93 (Tex. 1994) (discussing materiality of breach); In re Interest of

Doe, 917 S.W.2d 139, 142 (Tex. App. – Amarillo 1996, writ denied)

(substantial compliance excuses “contractual deviations or deficiencies

which do not seriously impair the purpose underlying the contractual

provision”).



                                     33
      Even forgetting about waiver and non-materiality, a jury could have

found that Don adequately performed the special provisions and that Jetall

lacked any justification for withholding $12,000 or $15,000 from the sales

price. The contract obligated Don and Gayle to provide a soil report and an

electronic survey. App. Tab 2 (Pl. Exh. 1 ¶ 11). The parties agree that Don

provided a soil report. Pl. Exh. 10; RR 3/65-67. Choudhri complained that

it dated to 1997, RR 3/65-67, but the contract does not expressly require a

new or recent report. App. Tab 2 (Pl. Exh. 1 ¶ 11). Moreover, Choudhri

admitted telling Don: “Don’t worry about the soil report. That’s fine. I’ll

deal with it.” RR 3/85-86, 200-01 (Choudhri “willing to… forgive and

forget” soil report). Likewise, Don testified that he provided an electronic

survey. RR 2/257, RR 4/95. As with the soil report, Choudhri testified that

he was expecting a newer one, RR 3/184, but the contract does not expressly

require a new survey or one completed only after the replatting. App. Tab 2

(Pl. Exh. 1 ¶ 11). And any understandings or expectations Choudhri may

have had about these items based on conversations with Don are irrelevant

to what the literal terms required of the Holmeses. Id. (Pl. Exh. 1 ¶ 22)

(“entire agreement” clause). Thus, a jury could find that Don and Gayle

fully complied with the soil report and survey provisions.




                                     34
     As for the replatting, Don acknowledged that he did not finish the task,

based on his understanding that this would happen after the closing. RR

2/254-56, 271-72; RR 4/100-01. While this was not compliant with the

contract, Don testified that finishing the process would only have cost $525.

Id. Thus, a jury could find that there was no basis to withhold $12,000 to

$15,000 in order to compensate for the failure to complete the replatting

before closing, and that Choudhri’s stated insistence that he would do so

(according to Don) was a repudiation of his obligation to pay $450,000 for

the lot. In fact, even if all three items – the soil report, the survey and the

replatting – are considered breaches by Don and Gayle, there is no evidence

that they would cost Jetall $12,000 to $15,000 to ameliorate.          On the

contrary, Choudhri conceded that he did not know exactly how much

obtaining these items would actually have cost. RR 4/61-62. Hence, there is

ample evidence that Choudhri simply resolved to pay a lower price for the

property, set out to use the special provisions as a smokescreen for doing so,

and thereby anticipatorily breached.

      “An anticipatory breach has been committed when one party demands

of the other party a performance to which he has no right under the contract

and states definitively that unless demand is complied with he will not

render the promised performance.” Lytle Lake Water Control and Imp. Dist.



                                       35
v. Shaw Envtl., Inc., 2006 WL 6863698 at * 5 (N.D. Tex. 2006); accord Jon-

T Farms, Inc. v. Goodpasture, Inc., 554 S.W.2d 743, 746 (Tex. App. –

Amarillo 1977, writ ref’d n.r.e., disapproved on other grounds, McKinley v.

Drozd, 685 S.W. 2d 7 (Tex. 1985)) (citing comment to Tex. Bus & Com.

Code § 2.610: “repudiation occurs when one party… declares that he will

not perform except on conditions which go beyond the contract”);

Humphrey v. Placid Oil Co., 142 F. Supp. 246, 252 (E.D. Tex. 1956), aff’d,

244 F.2d 184 (5th Cir. 1957).

      Examples of this sort of repudiation include refusing to fund a

previously agreed settlement unless a party acquiesced in new demands

concerning an exchange of stock, see Dror v. Mushin, 2013 WL 5643407 at

* 5 (Tex. App. – Houston [14th Dist.] 2013, rev. denied); refusing to pay for

dredging unless the payee used a different measurement of sediment than the

contract prescribed, see Lytle Lake, 2006 WL 6863698 at * 5; refusing to

close a real estate sale absent changes to a loan at odds with the sales

contract, see First Fed. Sav. & Loan Assoc. of Wilmette, Ill. v. Pardue, 545 F.

Supp. 433, 436-37 (N.D. Tex. 1982), aff’d, 703 F.2d 555 (5th Cir. 1983);

refusing to reinstate an insurance policy without extra, unauthorized

premium payments, see Crown Life Ins. Co. v. Reliable Machine and Supply

Co., Inc., 427 S.W.2d 145, 150 (Tex. App. – Austin 1968, writ ref’d n.r.e.);



                                     36
and refusing to make payments unless oil well operators ran additional tests

not required by the contract. Humphrey, 142 F. Supp. at 254.

      This is the sort of repudiation that occurred in this case. Here too, a

jury could find that Don and Gayle adequately performed the special

provisions, that not performing them did not add up to $12,000 or $15,000

anyway, that they were not material, and that Jetall waived them. Under any

of these circumstances, Jetall would have no basis under the contract to

lodge the new and additional demand of a significantly lower sales price as

its condition for consummating the sale. Telling Don that closing would

only occur with Jetall withholding or escrowing part of the previously

decided purchase price due to the special provisions communicated a

repudiation that excused the Holmeses’ performance.

      In rejecting this argument at trial, the district court construed the

written correspondence from Choudhri to Don in December 2011 to be

making a new offer – withholding $12,000 in exchange for relief from the

special provisions – and that, when Don declined, the new offer “died on the

vine.” RR 4/7-8, 52-58; Pl. Exh. 23, 24, 29. But the court overlooked the

more unequivocal testimony from Don that Choudhri told him at their

December 13 meeting that he would withhold $12,000 or $15,000 at closing

or place it in escrow, as well as Don’s testimony that title company



                                     37
employees told him the same thing. See supra. This testimony alone is

some evidence that Jetall committed anticipatory breach. To the degree that

Choudhri’s writings might have communicated a different or mixed message,

it was the jury’s job to choose among the disputed facts and multiple

potential meanings once properly instructed by the court on repudiation and

excuse.

      Moreover,     the   trial   court        misconstrued   Choudhri’s   written

correspondence.    In his December 13 email, Choudhri did not simply

indicate that Jetall would close the sale; he flatly demanded performance of

the special provisions (“The property is to be delivered with this done”) and

insisted that Don either delay the closing or credit $12,000 to Jetall. Pl. Exh.

23. If, as discussed above, a jury could find that Don and Gayle had already

substantially complied with the special provisions by this time, that they

were waived or non-material, or that, at most, they should credit $525 to

Jetall to finish the replatting, Choudhri’s requirement of either an

unspecified delay or the forfeiture of $12,000 was a new and extra-

contractual demand that could be construed as repudiation. See pp. 35-36,

supra (and authority cited therein).           This is even more true of Jetall’s

lawyer’s letter to Don dated December 21. Pl. Exh. 29. That letter did not

propose deferring the closing but demanded either compliance with the



                                          38
special provisions or deduction of $12,000 from the sales price, and

threatened litigation to boot. Id. In any event, while these documents may

be subject to more than one reading, Don’s testimony alone is some

evidence of Jetall’s repudiation.

      In the end, whether Jetall would have simply closed the sale on

December 15 and paid the full purchase price was a disputed issue of fact.

Choudhri testified that Jetall would have, and would have forgiven any

supposed noncompliance with the special provisions.         The documentary

evidence is arguably open to interpretation. But Don’s testimony directly

contradicted Choudhri’s account and would permit a jury to find that closing

would only have occurred if he and Gayle accepted $12,000 to $15,000 less

for their property. Given that testimony, they were entitled to a question on

anticipatory breach, and the trial court’s failure to submit one requires

reversal and a new trial.

                                    PRAYER

      The Court should reverse the award of lost profits and render

judgment for Jetall in the amount of $127,800 – representing the $75,000

award for the difference in value of the property and the $52,800 award for

attorneys’ fees incurred through trial – plus allowable interest. Failing that,

the Court should reverse the judgment and remand the case for retrial solely



                                      39
on liability and on damages based only on the difference between the price

Jetall agreed to pay and the market value of the property. As a last option,

the Court should remand and order a retrial on all issues. In addition, since

the district court’s judgment will be altered by this Court’s judgment, the

Court should dissolve the abstract of judgment filed by Jetall during the

pendency of this appeal.


August 10, 2015                Respectfully Submitted,



                                /s/          Martin J. Siegel
                                Martin J. Siegel
                                Texas State Bar No. 18342125
                                LAW OFFICES OF MARTIN J. SIEGEL, P.C.
                                2222 Dunstan Road
                                Houston, Texas 77005
                                Telephone: (713) 226-8566
                                Martin@Siegelfirm.com

                                Geoffrey Berg
                                Texas Bar No. 00793330
                                BERG FELDMAN JOHNSON BELL, LLP
                                4203 Montrose Blvd., Suite 150
                                Houston, Texas 77006
                                Telephone: (713) 526-0200
                                Gberg@bfjblaw.com

                                Attorneys for Appellants




                                     40
                       CERTIFICATE OF SERVICE

      I hereby certify that a copy of the foregoing corrected brief was served

on counsel of record for Appellee on December 21, 2015, by electronic

means:


Lori Twomey
George May
Twomey May PLLC
2 Riverway, 15th Fl.
Houston, TX 77056

Counsel for Appellee



                                      /s/          Martin J. Siegel
                                      Martin J. Siegel




                                     41
                   CERTIFICATE OF COMPLIANCE

      I certify that this brief complies with the word limit of TEX. R. APP. P.

9.4(i)(2) because this brief contains 9,389 words, excluding the parts of the

brief exempted by TEX. R. APP. P. 9.4(i)(1).




                                       /s/          Martin J. Siegel
                                       Martin J. Siegel



Dated: December 21, 2015




                                     42
APPENDIX
                                           INDEX


                                                                                          Tab:


Final Judgment and Charge of the Court ........................................................ 1

Jetall-Holmes Sales Contract, Plaintiff’s Exh. 1 ............................................ 2
