Virtuolotry, LLC and Richard Boyd v. Westwood Motorcars, LLC
05-19-01055-CV
| Tex. App. | Sep 17, 2024Background
- Westwood Motorcars (tenant) leased property from Virtuolotry, LLC (landlord) for a used car dealership, with two extension options in the lease addendum defining rent adjustment caps.
- In 2015, Virtuolotry purchased the property and refused to allow Westwood's second lease extension, alleging lease breaches.
- Westwood sued for declaratory judgment and breach of contract; Virtuolotry counterclaimed for breach and brought additional claims after Westwood vacated the premises.
- The jury awarded Westwood actual and exemplary damages, including for constructive eviction against Boyd (landlord's owner) and benefit-of-the-bargain and lost profits for breach.
- The Court of Appeals originally held that Westwood, by consenting to judgment in an eviction action, abandoned damages claims, but the Texas Supreme Court reversed, holding eviction possession judgments do not bar separate damages suits.
- On remand, the appellate court reversed damages against Boyd and the duplicative recovery, remanding attorney fees for recalculation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Lease Extension Enforceability | Extension addendum is enforceable with rent cap, not indefinite. | Extension language is an unenforceable agreement to agree, lacking specific rent. | Extension provision is binding; rent was set within cap; landlord waived objections. |
| Constructive Eviction Against Boyd | Boyd personally liable for torts, including constructive eviction. | No landlord–tenant relationship with Boyd, so no personal liability. | No evidence for constructive eviction or Boyd’s liability; actual eviction precludes constructive. |
| Double Recovery - Lost Profits/Benefit | Both measures reflect different damage elements due to breach. | Awarding both is duplicative—plaintiff must elect one remedy. | Awards were duplicative; plaintiff may recover only one (lost profits); rental value differential disallowed. |
| Attorney’s Fees | All fees recoverable (claims intertwined; lease allows broad recovery); fees appropriately segregated. | Fees must be segregated; cannot recover for unrelated/tort claims or expert fees. | Fees/costs allowed per contract, but remanded for recalculation due to revised damages. |
Key Cases Cited
- Fischer v. CTMI, L.L.C., 479 S.W.3d 231 (Tex. 2016) (unenforceable agreements to agree cannot serve as contracts)
- Alm v. Aluminum Co. of Am., 717 S.W.2d 588 (Tex. 1986) (legal sufficiency/no-evidence standard)
- Birge v. Toppers Menswear, Inc., 473 S.W.2d 79 (Tex. App.—Dallas 1971) (tenant cannot recover both lost profits and rental differential for same breach)
- Sharifi v. Steen Auto., LLC, 370 S.W.3d 126 (Tex. App.—Dallas 2012) (breach of contract damages aim for just compensation)
- Tex. Instruments Inc. v. Teletron Energy Mgt., Inc., 877 S.W.2d 276 (Tex. 1994) (lost profits analysis focuses on business activity, not entity)