Powell Electrical Systems, Inc. v. Hewlett Packard Co.
356 S.W.3d 113
Tex. App.2011Background
- Powell designed and installed electrical equipment for HP’s Willow Substation and crossed breaker cables during retrofitting, causing transformer B to fail.
- HP incurred costs to repair transformer B and to obtain a temporary transformer for use during repairs.
- Jury awarded HP $926,585.98 in damages and $163,526.24 in attorney’s fees; damages included several line-item costs.
- Contractual provisions barred consequential damages but allowed direct damages; dispute centered on whether the loss-of-use costs were direct or consequential.
- Trial court reduced the damages to 876,810.61 due to offset; the judgment also addressed attorney’s fees and appellate fees, prompting appeals and cross-appeals.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Damages: are loss-of-use costs consequential or direct? | Powell argues loss-of-use costs are consequential damages barred by contract. | HP contends loss-of-use costs are direct damages. | Loss-of-use costs are consequential; other transformer-related costs are direct. |
| Was the jury charge error-free in submitting breach theories? | Powell contends broad-form questions commingled viable and nonviable theories. | HP argues the charge properly aggregated a single theory with multiple bases. | Jury charge was not erroneous; broad-form submission justified. |
| Did HP conclusively prove the amount of its damages and attorney’s fees? | Powell argues HP failed to prove damages and fees as a matter of law because of causation and proof issues. | HP asserts invoices and testimony established damages and fees. | HP did not conclusively prove damages; damages were remanded for apportionment; appellate fees remanded for new trial. |
| Are appellate attorney’s fees recoverable and properly awarded? | Powell contends appellate fees were improperly awarded. | HP seeks appellate fees based on prevailing positions. | Appellate fees must be determined after remand; remanded for new trial on appellate fees. |
| Cross-appeal on damages/fees reduction: effect on fee awards? | Powell argues reduction invalidates related fee awards. | HP contends reduction requires adjustment of fees; remand appropriate. | Remand for new trial on attorney’s fees due to reduced damages. |
Key Cases Cited
- Arthur Andersen & Co. v. Perry Equipment Corp., 945 S.W.2d 812 (Tex. 1997) (direct vs. consequential damages; foreseeability and contractually contemplated damages)
- Reynolds Metals Co. v. Westinghouse Electric Corp., 758 F.2d 1073 (5th Cir. 1985) (measure of damages under contract; damages related to transformer repairs and installations)
- Bush v. KPH Consol., Inc., 122 S.W.3d 835 (Tex. 2003) (broad-form questions must be supported by law and evidence; separate submissions preferred when theories are uncertain)
- Casteel v. Crown Life Ins. Co., 22 S.W.3d 378 (Tex. 2000) (limits on broad-form liability submissions; when feasible, submit separate theories)