403 S.W.3d 660
Mo. Ct. App.2012Background
- Wehr terminated Purchase Order No. 003 for the Kansas Plaza project citing increased construction costs, not Williams' performance, leading Williams to claim breach and seek damages.
- Williams sought $60,986.25, comprising $35,000 for lost profits and overhead plus $25,986.25 payable to ABC for engineering services, offset by a $14,972 mobilization payment Wehr had already made.
- Trial evidence showed Williams had completed some engineering work for ABC but could not supply all submittals within three weeks as required; Wehr canceled the order largely due to cost concerns.
- The trial court found Wehr breached the contract by terminating for convenience and awarded Williams $20,027.97, denying ABC-related damages of $25,986.25.
- On appeal, the court held Williams established lost profits with reasonable certainty but disallowed $5,000 of fixed overhead because it could not be tied to gross revenue and because labor overhead would have occurred regardless of the profits.
- The appellate court calculated Williams’ net recovery as $15,028 (lost profits $30,000 minus the $14,972 mobilization previously paid) and remanded for entry of an amended judgment accordingly.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Wehr breached by terminating the purchase order | Williams: termination for convenience breached the contract. | Wehr: Williams' first breach (incomplete drawings) justified termination. | Wehr breach; termination not excused by Williams' noncompliance. |
| Whether Williams proved lost profits and overhead damages with sufficient certainty | Williams: lost profits proven; overhead recoverable. | Wehr: overhead unsupported; only lost profits proven. | Lost profits proved; overhead $5,000 not supported; net damages reduced. |
Key Cases Cited
- Murphy v. Carron, 536 S.W.2d 30 (Mo. banc 1976) (standard of review for contract cases; substantial evidence/weight of the evidence)
- Salem United Methodist Church v. Bottorff, 138 S.W.3d 788 (Mo.App.2004) (presumption of trial court judgment; burden on appellant)
- Surrey Condominium Ass’n, Inc. v. Webb, 163 S.W.3d 531 (Mo.App.2005) (evidence viewed in light favorable to prevailing party)
- Essex Contracting, Inc. v. Jefferson County, 277 S.W.3d 647 (Mo. bane 2009) (credibility; Rule 84.13(d) standard)
- Strobl v. Lane, 250 S.W.3d 843 (Mo.App.2008) (trial court credibility determinations given deference)
- Classic Kitchens & Interiors v. Johnson, 110 S.W.3d 412 (Mo.App.2003) (material breach and performance standards; deference to trial court)
- Parshall v. Buetzer, 195 S.W.3d 515 (Mo.App.2006) (testimony of industry experience supports lost profits with reasonable certainty)
- American Laminates, Inc. v. J.S. Latta Co., 980 S.W.2d 12 (Mo.App.1998) (recovery of fixed overhead if proven by substantial evidence)
- Scullin Steel Co. v. PAC-CAR, Inc., 748 S.W.2d 910 (Mo.App.1988) (overhead elements related to gross revenue must be evidenced)
- Birdsong v. Bydalek, 953 S.W.2d 103 (Mo.App.1997) (damages for lost profits; reasonable certainty standard)
- Catroppa v. Metal Bldg. Supply, Inc., 267 S.W.3d 812 (Mo.App.2008) (lost profits and overhead proof; cannot double-recover profits and overhead)