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Toshiba Machine Co.11/10/2005
more profit on each of the fluid ends actually produced. With the time saved, SPM could also have made and sold more fluid ends and made additional profit. The time used to make fluid ends is the same, but the lost profits are separate and distinct.
We overrule Toshiba's issue six.
c. Did the trial court err by submitting broad-form damage questions?
In its eleventh issue, Toshiba argues that the trial court erred in failing to submit damage questions that provided separate blanks for each element of SPM's damage model. We disagree.
Toshiba's complaint about the damage submission turns on the proposition that a trial court commits reversible error where it submits a broad-form damage issue that incorporates an element of damages on which there is no evidence. Harris County v. Smith, 96 S.W.3d 230, 234 (Tex. 2002). Such a submission prevents the appellate court from determining whether the jury based its verdict on an improperly submitted element of damage. Id. Toshiba identifies lost profits as the element of damage lacking evidentiary support.
Toshiba's argument fails because we have already concluded that there is legally sufficient evidence to support the jury's award, even if the entire award consists of lost profits. We overrule Toshiba's eleventh issue.
d. May SPM recover both its purchase money and consequential damages?
In its first issue, Toshiba argues that a party claiming breach of contract may not recover both the purchase money paid under the contract--what Toshiba calls "rescission damages"--and consequential damages. But SPM's purchase money was not submitted to the jury as an element of SPM's contract damages. Therefore, Toshiba's first issue is moot, and we need not consider it. See TEX. R. APP. P. 47.1.
4. Did SPM fail to mitigate its damages?
In issue 7b, Toshiba argues that the trial court erred by awarding damages that SPM could have avoided by cover or mitigation. Toshiba claims that SPM did nothing to mitigate its losses and therefore is barred from recovering any consequential damages.
A buyer may recover consequential damages that could not reasonably be prevented by cover. TEX. BUS. & COM. CODE ANN. § 2.715(b)(1) (Vernon 1994). After a breach by the seller, the buyer may "cover" by making, in good faith and without unreasonable delay, any reasonable purchase of goods in substitution for those due from the seller. Id. § 2.712(a). To determine if a buyer effected a proper attempt at cover, we consider "whether at the time and place the buyer acted in good faith and in a reasonable manner . . . ." Id. § 2.712, cmt 2. " t is immaterial that hindsight may later prove that the method of cover used was not the cheapest or most effective." Id. The burden of establishing that damages could not have been reasonably prevented by cover is on the plaintiff. Wilson v. Hays, 544 S.W.2d 833, 836 (Tex. Civ. App.--Waco 1976, writ ref'd n.r.e.).
Mitigation of damages is a rule requiring the injured party to use reasonable diligence to minimize his damages. LTV Aerospace Corp. v. Bateman, 492 S.W.2d 703, 709 (Tex. Civ. App.--Tyler 1973, writ ref'd n.r.e.). Though mitigation is similar to cover, the burden of disproving mitigation lies with the defendant.
The trial court submitted the issues of cover and mitigation to the jury as limiting instructions on the breach of contract damage questions, as follows:
Do not include in your answers any loss you find SPM could have avoided by the exercise of reasonable care. Do not include in your answer any loss that occurred after the date that replacement machining centers could have been
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