Nelson Cash Register, Inc. v. Data Terminal Systems, Inc.
| Decision Date | 11 April 1984 |
| Docket Number | 04-82-00457-CV,Nos. 04-82-00412-C,s. 04-82-00412-C |
| Citation | 671 S.W.2d 594 |
| Parties | NELSON CASH REGISTER, INC., Appellant, v. DATA TERMINAL SYSTEMS, INC., Appellee. |
| Court | Texas Court of Appeals |
Daniel R. Rutherford, San Antonio, for appellant.
Dale Ossip Johnson, Austin, Roy Keezel, Anthony J. Sadberry, Houston, Luther H. Soules, III, Soules & Cliffe, San Antonio, for appellee.
Before ESQUIVEL, REEVES and TIJERINA, JJ.
This is an appeal from a lawsuit initiated by appellant, Nelson Cash Register, Inc. [hereinafter Nelson or appellant], against appellee, Data Terminal Systems, Inc. [hereinafter DTS or appellee], and several others who are not parties to this appeal.
The theory underlying appellant's lawsuit was that appellee, acting either alone or in concert with others, set out to, and did, in fact, destroy appellant's business. Appellant alleged both tort and contract causes of action in addition to others which are not germane to this appeal. A jury awarded appellant actual damages, attorney's fees, and exemplary damages, but the trial court disallowed the finding for exemplary damages to which ruling appellant Nelson Cash Register, Inc., brings this appeal.
Appellee appeals from the trial court's judgment awarding appellant actual damages for breach of contract and attorney's fees. Because of the nature of this appeal and appellee's attack on the sufficiency of the evidence, a detailed recitation of the facts is necessary.
Appellant, an established concern in the sale of cash registers, on July 1, 1975, entered into a dealer franchise agreement with appellee. The agreement provided Nelson the right to sell and service electronic cash registers manufactured by DTS in thirty-nine Texas counties. The agreement was subject to termination by Nelson by giving thirty days notice to DTS of its intention to terminate. DTS could terminate the contract if Nelson failed to substantially comply with the contract's provisions or if Nelson became seriously delinquent, insolvent, or filed for bankruptcy.
Nelson and DTS conducted business with each other under the terms of this agreement until November 1, 1977. At that time, a new contract, from which this litigation arose, was executed.
The subsequent agreement differed from the prior agreement in that the term of the contract was for one year, at which time either party could terminate the contract by giving proper notice.
Failure of Nelson to meet its quota was grounds for DTS to seek termination of the contract or require Nelson to seek arbitration as to whether or not the contract should be terminated. The quota called for in the November 1977 contract was not established until February 1, 1978, and thus was unknown to Nelson at the time the contract was executed. Subsequent to the new contract's execution, DTS established a quota for Nelson that was approximately twice the dollar amount of Nelson's prior quota.
After the execution of the November 1, 1977 contract, Nelson contends that a series of problems and difficulties arose between the parties. Nelson pled that the new contract, which he alleges he was forced to sign, opened the door to a conspiracy to put it out of business. This, Nelson contends, was done purposely to enable one of the conspirators to take over Nelson's sales area and customers. The alleged conspirators were DTS, Malloy Cash Register, Inc. and its principal officers, directors, and shareholders, Eugene F. Malloy, and Dennis M. Malloy, Advanced Retail Control Systems, Inc., and Bob Coleman. Dennis M. Malloy and Bob Coleman were the original directors of Advanced Retail Control Systems, Inc., as well as its officers and shareholders. Eugene F. Malloy was an original director. The conspirators, averred Nelson, sometimes acting severally and sometimes jointly, committed the following acts:
(1) That at the time the contract was signed, November 1, 1977, the quota figure establishing the dollar amount to be sold was left open; that the quota establishing an amount at $200,000.00, which was set February 1978, was unreasonable, arbitrary and designed to thwart Nelson's effort in maintaining the dealership; that the purpose of the high quota was to give DTS grounds to cancel Nelson's dealership.
(2) That Bob Coleman, a former major account salesman for DTS in the San Antonio and Houston area, in consort with Malloy Cash Register, Inc. and its principal owners, Eugene F. Malloy and Dennis M. Malloy, formed Advanced Retail Control Systems, Inc., for the specific purpose of taking over the San Antonio area when Nelson lost the dealership contract with DTS.
(3) That DTS embarked upon a course of action whereby it failed to adequately train and teach Nelson's personnel as provided for in the contract so that they could adequately install and maintain the DTS equipment.
(4) That DTS furnished faulty equipment and that the equipment furnished was intentionally delivered late, and that equipment sent back to the factory for repair and was not timely repaired.
These acts and others by the parties, acting in consort, were allegedly done by the conspirators to insure Nelson's loss of the dealership, and thereby permit Advanced to take over the San Antonio area.
Nelson pled, in the alternative, that DTS breached its contract in the particulars enumerated above, all of which prevented Nelson from fulfilling its contractual obligation to the customers of Nelson who had purchased DTS equipment. Pleading further in the alternative, Nelson contended the quota provision in the November 1977 dealership contract, which increased Nelson's quota approximately 100%, was in violation of TEX.BUS. & COM.CODE ANN. § 2.302 (Vernon 1968).
The special issue regarding DTS's liability, and the jury's answer thereto is as follows:
Special Issue No. 1.
Do you find from a preponderance of the evidence that the Defendant DTS failed to faithfully perform the contract of November 1, 1977, with Nelson Cash Register, Inc., in any of the following respects:
Yes No
---- ----
A. Failing to adequately train Nelson
Cash Register's personnel X
---- ----
B. Furnish Nelson Cash Register with
defective equipment X
---- ----
C. Failing to ship equipment, components
and/or parts ordered by Nelson
Cash Register X
---- ----
D. Failing to timely repair equipment
sent to the factory by Nelson Cash
Register for repair X
---- ----
E. Failing to consult with Nelson Cash
Register before setting the 1978
quota X
---- ----
Additionally, the jury found:
That such failure was a proximate cause of Nelson's damage.
That as a result of the failure of DTS to faithfully perform the contract, Nelson had been damaged in the sum of $270,000.00.
That Nelson was entitled to attorney's fees of $90,000.00 through the trial court, an additional $7,500.00 through judgment in the Court of Appeals, an additional $4,500.00 through refusal of application for writ of error to the Supreme Court, and $500.00 through final judgment of the Texas Supreme Court.
That DTS had acted willfully or maliciously.
That Nelson should recover $500,000.00 exemplary damages.
The trial court entered judgment awarding Nelson actual damages of $270,000.00 and attorney fees, but denied the exemplary damages.
Nelson's sole point of error is the trial court's refusal to award judgment on the verdict for the exemplary damages. Nelson asserts it has pled, proved and the jury found, that DTS had committed a "tortious breach of contract" in its dealings with Nelson which entitled Nelson to the exemplary damages. Conversely, DTS contends that Nelson is not entitled to its exemplary damages since the court granted its motion for directed verdict that all causes of action against DTS which were
[G]enerally predicated upon said Defendant's [DTS] conspiracies, tortious interference with conduct of Plaintiff's [Nelson's] business, tortious interference with Plaintiff's contract with said Defendant, violations of the anti-trust laws of the State of Texas, Vernon's Ann.Civ.St., art. 7428 ... be and are withdrawn from the jury and judgment be and is rendered for Defendant Data Terminal Systems, Inc. and against Plaintiff that Plaintiff take nothing by said causes of action.
We note that the written order quoted above partially sustaining DTS's motion for instructed verdict is much broader than either the oral motion presented or the bench ruling obtained at the close of Nelson's case. In deciding this appeal, however, we need not decide either the validity or scope of that order.
Appellant's only objection to the court's charge as it related to the presentation of its case, was that it failed to submit appellant's antitrust theory of recovery to the jury. Appellant submitted two requested issues to the court which were denied, both of which related to appellant's antitrust theory of recovery. The failure to submit these issues is not raised in a point of error and is not before us. Thus, appellant's recovery of exemplary damages must stand or fall on the issues submitted. TEX.R.CIV.P. 279.
A breach of contract, standing alone, no matter how malicious or willful, will not support an award of exemplary damages. Amoco Production Co. v. Alexander, 622 S.W.2d 563, 571 (Tex.1981); A.L. Carter Lumber Co. v. Saide, 140 Tex. 523, 526, 168 S.W.2d 629, 631 (1943); McDonough v. Zamora, 338 S.W.2d 507, 513 (Tex.Civ.App.--San Antonio 1960, writ ref'd n.r.e.). To support an award of exemplary damages a breach of contract must be accompanied by a separate...
To continue reading
Request your trial
-
ABRAXAS PETROLEUM v. HORNBURG, 08-98-00286-CV
...alleged breach and the alleged damages will preclude recovery. Prudential Securities, 973 S.W.2d at 397; Nelson Cash Register, Inc. v. Data Terminal Systems, Inc., 671 S.W.2d 594, 600 (Tex.App.--San Antonio 1984, no Abraxas argues that the mere sending of the AFE letter did not result in an......
-
Adams v. H & H Meat Products Inc.
...the alleged breach and the alleged damages will preclude recovery. Prudential Sec., 973 S.W.2d at 397; Nelson Cash Register, Inc. v. Data Terminal Sys., Inc., 671 S.W.2d 594, 600 (Tex. App.--San Antonio 1984, no The universal rule for measuring damages for the breach of a contract is just c......
-
Prudential Securities, Inc. v. Haugland
...connection between the alleged breach and the alleged damages will preclude recovery. Nelson Cash Register, Inc. v. Data Terminal Systems, Inc., 671 S.W.2d 594, 600 (Tex.App.--San Antonio 1984), aff'd, 762 S.W.2d 744 No Presumption of Tax Liability The Hauglands maintain that Prudential's a......
-
Reynolds v. McCullough
... ... certain real property to Thorn's Properties, Inc. (Thorn) on August 1, 1974 (Ground Lease). An ... Nelson v. Seidel, 328 S.W.2d 805, 807 ... ...
-
Chapter 6-1 Wrongful Discharge—Breach of Employment Agreement
...Haughland, 973 S.W.2d 394, 396-97 (Tex. App.—El Paso 1998, pet. denied) (citing Nelson Cash Register, Inc. v. Data Terminal Sys., Inc., 671 S.W.2d 594, 500 (Tex. App.—San Antonio 1984, no writ)).[17] Gulf Consol. Intern., Inc. v. Murphy, 658 S.W.2d 565, 566 (Tex. 1983).[18] J & D Towing, LL......