Mason and Dixon Lines, Inc. v. Byrd

• Decision Date: 19 June 1992
• Citation: 601 So.2d 68
• Parties: The MASON AND DIXON LINES, INC. v. Warren BYRD, Individually and d/b/a Byrd Drayage. 1910094.
• Court: Alabama Supreme Court

Page 68

601 So.2d 68

The MASON AND DIXON LINES, INC. v. Warren BYRD, Individually and d/b/a Byrd Drayage.

1910094.

Supreme Court of Alabama.

June 19, 1992.

Steven L. Nicholas of Sirote & Permutt, P.C., Mobile, for appellant.

Donald M. Briskman and Donna L. Ward of Briskman & Binion, P.C., Mobile, for appellee.

HORNSBY, Chief Justice.

This is an appeal from a judgment based on a jury verdict against The Mason and Dixon Lines, Inc. ("Mason and Dixon"), awarding Warren Byrd $75,000 for breach of contract and $25,000 for fraud. Mason and Dixon filed a motion for a judgment notwithstanding the verdict or, in the alternative, for a new trial. The trial court denied the motion and Mason and Dixon appealed. We affirm.

Mason and Dixon is a transportation company based in Kingsport, Tennessee. It relies on independent agents operating in territories throughout the country to solicit freight for delivery in Mason and Dixon's equipment. This equipment consists of company-owned and independently owned transport vehicles. In June 1988, Mason and Dixon entered a written agreement with Warren Byrd, designating Byrd as an independent agent in Mobile, Alabama. Byrd was already an agent for Ranger Transport ("Ranger"), a competitor of Mason and Dixon's. Byrd had serviced Ranger successfully since 1979, earning Ranger over $1,000,000 in gross income each year. Byrd's success for Ranger prompted Mason and Dixon to pursue an agency relationship with him.

Before securing an agreement with Byrd, Mason and Dixon had experienced difficulty in supplying the territory surrounding Mobile with transport equipment. To encourage Byrd's commitment, Mason and Dixon's regional director, Phillip Jones, and its regional manager, William Cowan, promised Byrd complete support in obtaining equipment for delivery of freight. Jones and Cowan were responsible for securing Mason and Dixon's contract with Byrd, but both left the company after Byrd entered his contract. Byrd served as an agent for Mason and Dixon until January 1990. During that time, he generated very little income for the company. Mason and Dixon attributed Byrd's inability to earn income to his failure to solicit independent truck owners to transport freight, and Mason and Dixon terminated him for that reason. Byrd claimed that his low income resulted from a failure by Mason and Dixon to supply him with equipment.

Byrd sued Mason and Dixon, alleging breach of contract and fraud. After a trial, the jury returned a verdict against Mason and Dixon. Mason and Dixon raises five issues for review. We address these issues in light of the presumption that the jury's verdict is correct.

The strength of the jury verdict is based upon the right to trial by jury, White v. Fridge, 461 So.2d 793 (Ala.1984), and a jury verdict is presumed to be correct. Alpine Bay Resorts, Inc. v. Wyatt, 539 So.2d 160, 162 (Ala.1988). This presumption is strengthened by the trial court's denial of a motion for a new trial.

"When a jury is the trier of fact, it is not for the trial judge, nor an appellate court, to attempt to determine with mathematical certainty that all of the various elements of evidence offered by the parties regarding specific costs and credits precisely equal the amount of the jury's verdict. We do not have trial by computer, nor do we have post-trial, or appellate review by the computer. The reviewing court does not substitute its own judgment as to the amount of damages for that of the trier of fact."

G.M. Mosley Contractors, Inc. v. Phillips, 487 So.2d 876, 879 (Ala.1986). See also Hollis v. Wyrosdick, 508 So.2d 704 (Ala.1987).

"Upon review of a jury verdict, we presume that the verdict was correct; we review the tendencies of the evidence most favorably to the prevailing party; and we indulge such reasonable inferences as the jury was free to draw from the evidence. We will not overturn a jury verdict unless the evidence against the verdict is so much more credible and convincing to the mind than the evidence supporting the verdict that it clearly indicates that the jury's verdict was wrong and unjust."

Campbell v. Burns, 512 So.2d 1341, 1343 (Ala.1987) (citation omitted). See also Ashbee v. Brock, 510 So.2d 214 (Ala.1987); Jawad v. Granade, 497 So.2d 471 (Ala.1986); and White v. Fridge, supra.

I. Breach of Contract/Lost Profits

Mason and Dixon raises three issues with respect to Byrd's claims for lost profits. The only evidence of damages Byrd presented at trial related to lost profits. In Paris v. Buckner Feed Mill, Inc., 279 Ala. 148, 182 So.2d 880 (1966), this Court stated the general rule regarding recovery of lost profits as an element of damages:

"[T]he loss of profits must be the natural and proximate, or direct result of the breach complained of and they must also be capable of ascertainment with reasonable, or sufficient, certainty, or there must be some basis on which a reasonable estimate of the amount of the profit can be made; absolute certainty is not called for or required."

Paris, 279 Ala. at 149-50, 182 So.2d at 881 (quoting 25 C.J.S. Damages § 43); see also Kirkland & Co. of Anniston, P.C. v. A & M Food Service, Inc., 579 So.2d 1278, 1285 (Ala.1991); Super Valu Stores, Inc. v. Peterson, 506 So.2d 317, 327 (Ala.1987); Morgan v. South Central Bell Telephone Co., 466 So.2d 107, 115 (Ala.1985); Brendle Fire Equipment, Inc. v. Electronic Eng'rs, Inc., 454 So.2d 1032, 1034 (Ala.Civ.App.1984). "[T]he rule dictates [that] recovery will ensue despite the fact damages cannot be calculated with mathematical certainty." Morgan, 466 So.2d at 116.

Mason and Dixon first contends that Byrd did not establish a claim for breach of contract because his lost profits were not the natural and proximate result of Mason and Dixon's alleged breach. Byrd's breach of contract claim is based on Mason and Dixon's alleged failure to follow the termination procedure specified in the parties' written contract. Byrd asserts that any profits lost by Byrd resulted from Mason and Dixon's alleged failure to supply him with transport equipment. Because the promises to provide equipment were outside the written agreement, Mason and Dixon argue that all evidence respecting lost profits supported only Byrd's fraud claim, not his breach of contract claim; therefore, it says, the jury should not have considered any evidence of lost profits in connection with Byrd's claim of breach.

This Court has determined that a plaintiff attempting to establish damages in a breach of contract action need only " 'lay a foundation which will enable the trier of the facts to make a fair and reasonable estimate of the amount of damage.' " United Bonding Insurance Co. v. W.S. Newell, Inc., 285 Ala. 371, 380, 232 So.2d 616, 624 (1969) (quoting 22 Am.Jur.2d Damages § 25). Mason and Dixon's argument fails to recognize that Byrd's testimony revealed essentially two varieties of lost profits. First, Byrd testified that he lost approximately $95,000 in profits during the term of the contract because Mason and Dixon failed to provide equipment as promised. Second, his testimony indicated that he had earned approximately $5,000 annually from his Mason and Dixon business and that he was capable of earning up to $70,000 annually. Jones testified that Byrd could have generated at least $1,000,000 in gross revenue per year for Mason and Dixon had the transport equipment been made available to Byrd. Byrd testified to the following concerning past profits and potential earning power:

"Q. You heard Mr. Jones talk about some plaques on your walls. Do you know what he was talking about?

"A. Yes, sir.

"Q. What are they?

"A. Well, they're plaques they give us for moving a million dollars worth of revenue in a year.

"Q. And when was the first year you got that plaque?

"A. I believe it was '79 or '80.

"Q. And who awards them?

"A. Ranger out of Jacksonville.

"Q. When you got one for '79, was that the last year you got it?

"A. No, sir. I believe it was in '80 was the first one. I'm not sure. But I got one every year since.

"Q. The last 9, 10, 11 years?

"A. Yes, sir.

"Q. And are you able to do--do you have an opinion as to whether or not you could do that kind of job for Mason and Dixon had they properly supported you?

"A. Well, I felt it was twice as much business. Yes, I do feel like I could have done the same job for them without interfering with each other.

"Q. Mr. Jones said that he approximated you being able to do a minimum million dollars a year for Mason and Dixon?

"A. Yes, sir.

"Q. And your compensation was at least seven percent?

"A. Yes, sir.

"Q. And that's $70,000 a year?

"A. Yes, sir.

"Q. And you had that contract for 20 months, didn't you?

"A. Yes, sir."

Byrd's evidence of past profits earned and his potential earning power provided a reasonable basis for the jury to estimate the damages flowing from the breach of contract.

The second issue Mason and Dixon raises is whether the evidence at trial provided the jury with a basis for estimating lost profits with "reasonable certainty." See Paris, 279 Ala. at 149-50, 182 So.2d at 881. In Morgan, supra, this Court determined that testimony comparing the plaintiff's profits with those of his partner, both of whom were dentists, provided "a reasonable basis for the jury to approximate" the plaintiff's lost profits. Morgan, 466 So.2d at 116. The Court stated that "a horizontal comparison of two businesses" was a commonly accepted method for measuring losses. Id. To demonstrate lost profits, both Byrd and Jones testified that Byrd had earned gross income in excess of $1,000,000 for Ranger for each of the past 10 years. Further, both witnesses testified that Byrd could reasonably expect to generate a comparable amount of income for Mason and Dixon. ¹ Byrd's comparison of his earnings for Ranger with his potential earnings for Mason and Dixon constituted a horizontal comparison of businesses and provided a basis for the jury to estimate with reasonable certainty the profits...