MAJORITY OPINION Appellant Pura-Flo Corporation appeals from an adverse judgment in a breach of contract action brought by appellee Donald Clanton. In two issues Pura-Flo argues the trial court erred in failing to grant it judgment notwithstanding the verdict because Clanton produced legally insufficient evidence of future damages. We conclude the evidence is legally sufficient to establish Clanton’s future losses as a result of Pura-Flo’s actions and affirm the trial court’s judgment. BACKGROUND In 1994 Misty Vanderzyden invested in water cooler rentals with Water Equipment Company (“WEC”), a manufacturer of water purification equipment. The parties entered into a Rental Income Agreement (“the Agreement”) in which WEC agreed to sell Vanderzyden 50 “income producing water coolers rental customers (units)” for $49,280.31. According to the Agreement’s terms it was based on 50 units at $985.61 each, rental income averages of $35.00 per month per unit, maintenance and administration costs of $12.00 per month per unit, and replacement units at $100.00 per relocation. WEC agreed to service all equipment, be responsible for invoicing and collecting all rental accounts, and repossess and replace units in the event a rental customer canceled. In exchange, WEC would pay Vanderzyden $1,750.00 per month minus the $12.00 per unit maintenance and administration fee and any fees for repossession and replacement of units. The $100.00 fee covered the cost of repossessing the individual water cooler from a rental customer who canceled their contract, and placing a water cooler with another customer in another location where the customer was paying rent. The initial term of the Agreement was set at 60 months with Vanderzyden given the right to renew the agreement for an additional 36 months at the expiration of the original term. The Agreement further provided that, “Upon mutual agreement of both parties, said agreement may be renewed for an indefinite length of time.” A proposal that accompanied the Agreement described the transaction as an investment. In the Agreement WEC insured that in the event a rental customer canceled its contract, WEC would replace the account with a new customer within 72 hours. Rocky Rasberry, president of WEC, and later Pura-Flo, testified that Vanderzyden was his only investor for this program. On July 25, 2000, Pura-Flo notified Vanderzyden that if she did not renew the Agreement for another 36 months her water coolers would depreciate in value. A handwritten notation on the letter from Pura-Flo notes, “did renew—initial investment $50K.” In 2002, Clanton purchased the water cooler units and their future rental income from Vanderzyden. On June 25, 2002, Vanderzyden notified Pura-Flo that she “sold [her] ownership in fifty (50) units along with all future rental income pursuant to the March 1, 1994, agreement signed on February 28, 1994.” Vanderzyden notified Pura-Flo that “effective immediately” all correspondence and payments should be forwarded to Clanton. The expiration of the initial term of the Agreement caused Clanton to be concerned about the strength of the investment. To alleviate his concerns, Clanton sought a meeting with WEC, which by that time had changed its name to Pura-Flo. Clanton met with Vanderzyden and Rasberry to discuss whether the Agreement could be extended indefinitely after the expiration of the second term. Clanton testified that Rasberry “was very agreeable to transferring the ownership from [Vanderzyden] to [Clanton].” Clanton asked Rasberry if he could see the physical water coolers, and Rasberry responded, “Oh, no, they’re rented. They’re out in 50 locations.” Clanton asked Rasberry about the life of the water coolers and the indefinite term of the contract. Rasberry assured Clanton that the monthly maintenance fee kept the coolers sufficiently maintained and that each cooler’s “life was indefinite.” Clanton understood that by purchasing the water coolers and their rental customers he was “buying a stream of income,” and that he was “stepping into [Vanderzyden's] shoes.” Rasberry assured Clanton that his investment was not limited to the lifetime of each individual cooler. Clanton subsequently sent a letter to Rasberry thanking Rasberry for meeting with him. Clanton enclosed three letters signed by Clanton and Vanderzyden regarding the sale of the water coolers and rental customers. One of the enclosures was a letter dated June 25, 2002, in which Vanderzyden states that she had sold her “ownership in fifty (50) units along with all future rental income pursuant to the March 1, 1994, agreement[.]” Vanderzyden’s letter instructed Rasberry to forward all future correspondence and payments to Clanton. Rasberry responded congratulating Clanton on his investment: Congratulations on your new venture! I am happy to have you as one of our dealers. I have enclosed your executed original document of your agreement. I noticed in the document you sent that the contract renewal letter and fee increases were not attached. I hope you were aware of them. I have enclosed a copy for your files. If you have any questions please do not hesitate to call. Once you have had a chance to get a feel for the water business, you may want to increase your volume of customers. If so, please let me know and we will discuss further purchases. Again, welcome to the Pura Flo family of dealers. Attached to Rasberry’s letter was the June 25, 2002 letter written by Vanderzyden notifying Pura-Flo that she sold her ownership in the water coolers and rental income (the “executed original document of your agreement”), a notice that the monthly maintenance fee had been raised to $17.00 per unit per month (“the contract renewal letter and fee increases”). Clanton agreed to the increased monthly maintenance fee and Pura-Flo sent monthly invoices and checks to Clanton per the Agreement until 2016. Misty Jones, the chief financial officer for Pura-Flo, testified that she had been with Pura-Flo since 1996, two years after the original agreement with Vanderzyden. After Clanton purchased the Agreement, Jones was instructed by Harold Nedell, one of Pura-Flo’s principals, to issue checks to Clanton monthly. Jones was also given a “gray book,” which contained Pura-Flo’s rental customers. In describing monthly payments to Clanton, Jones testified: When [Nedell] instructed me about this whole monthly check to [Clanton], he said this is a list of quote, unquote customers that he’s got. Every time one of these gets pulled, then you’re supposed to put one of our rental customers that are getting rental income right here. That was the extent of it. I did this for years, years. The record contains numerous invoices and checks dated between 2002 and 2017 reflecting payments made to Clanton consistent with Jones’s testimony. In July 2016, Pura-Flo notified Clanton that it would be raising the maintenance and administration fee to $24.50 per unit per month and the repossession and replacement fee to $175.00 per unit. Pura-Flo did not plan to raise the monthly rent on each of the coolers. Clanton notified Pura-Flo that the contract did not allow for unilateral increases, but Clanton wanted to try to continue his relationship with Pura-Flo. Rasberry did not respond to Clanton’s notice, but also did not go forward with the fee increase. Subsequently, when Jones was reconciling Pura-Flo’s bank statements, she realized that a check sent to Clanton had not been cashed by Clanton. Seeing that the check had not cleared, Jones issued another check to Clanton, which Clanton cashed. Jones later learned that a third party had altered the first check and illegally cashed it for approximately $300.00. Jones sought to recoup Pura-Flo’s $300.00 from the bank. The bank asked Jones to obtain an affidavit from Clanton stating that, among other things, the endorsement on the check was forged. Clanton, however, did not have personal knowledge of the forgery and refused to sign the affidavit as written. Clanton changed the wording of the affidavit Jones had presented to reflect that Clanton did not have personal knowledge of the incident, signed the affidavit, and returned it to Jones. The bank, however, would not accept the revised affidavit. Jones sent another affidavit to Clanton asking him to sign it, but Clanton refused. Clanton testified that after he refused to sign the bank’s affidavit, Pura-Flo stopped sending monthly checks to him. Clanton received his last payment from Pura-Flo in December 2016. In sorting out the forged check, Rasberry testified that he learned for the first time that Clanton had been receiving monthly checks from Pura-Flo since 2002. Until that time, Rasberry testified, “I had no idea we still had a contract with [Clanton], none whatsoever.” Nedell, who originally instructed Jones about Clanton’s monthly checks, had left Pura-Flo, and by the time of trial, had passed away. On January 17, 2017, Rasberry sent a letter to Clanton requesting a copy of the Agreement between Clanton and Pura-Flo. Rasberry stated, “The contract between Pura-Flo and Misty Vanderzyden ended in 2012[1]. I was unaware that the accounting department did not catch the end date.” Until the Agreement was produced, Rasberry instructed the accounting department to withhold all payments to Clanton. Within two weeks, Clanton responded to Rasberry with copies of the Agreement, Vanderzyden’s letter to Clanton transferring the Agreement, and Rasberry’s 2002 letter congratulating Clanton on his new venture. Clanton subsequently met with Rasberry and Jones and discussed continuing their relationship. At that time Rasberry told Clanton that his watercoolers were obsolete and were not earning income. Rasberry claimed that was why Pura-Flo stopped paying Clanton. Two months later, Rasberry wrote to Clanton, explaining that the Agreement Clanton purchased in 2002 “was already expired when [Clanton] purchased it.” Rasberry explained that Pura-Flo’s continued payment to Clanton for 14 years past the Agreement’s expiration was due to an oversight and the loss of certain files in recent flooding. Pura-Flo offered to purchase Clanton’s 50 watercoolers for $50.00 each and asked that Clanton “consider the agreement terminated.” At trial Clanton took the position that the Agreement was for the sale of an “income-producing water cooler rental customer,” not simply a water cooler. Rasberry admitted that the Agreement with Vanderzyden was for the sale of an “income-producing water cooler rental customer.” However, Rasberry testified that Clanton had purchased, through Vanderzyden, physical water coolers that were no longer operational. For that reason, Pura-Flo took the position that it did not owe Clanton any money under the Agreement. This factual dispute was the main issue at trial. Clanton testified that he earned “plus or minus $9,000 a year” on the contract. By the time of trial, he had lost two years’ income. Clanton testified that he could replace a $9,000 a year income stream with a similar type of investment, which would require investment of approximately $300,000 in bonds or certificates of deposit with an average three percent yield. Therefore, Clanton testified, the future value of his 50 units producing $9,000 a year in income was worth $300,000 at the time Pura-Flo breached the contract. The jury concluded that the parties had a valid contract for services, that Pura- Flo breached that contract without excuse, and that Clanton’s damages for loss sustained in the past were $19,500. The jury further found future damages of $50,000 for loss that, in reasonable probability, would be sustained in the future. The jury further found that the contract had not been terminated. Based on the jury’s answers, the trial court signed a final judgment awarding Clanton $69,500 in damages plus attorney’s fees. Pura-Flo filed a post-judgment motion in which it asked the court, on the future-damages question, to either (1) enter judgment notwithstanding the verdict, (2) disregard the jury’s finding, or (3) grant a new trial. Pura-Flo argued that the only damages proven at trial, “other than a reference to the ‘deprivation of income stream’” were damages suffered in the past. Pura-Flo also argued that Clanton was not entitled to future damages because the contract could be terminated by either party at will, which would stop any further income. On appeal Pura-Flo challenges only the jury’s answer to the future damages question. Pura-Flo argues (1) the record discloses a complete lack of evidence on Clanton’s future damages; (2) the court was barred by rules of law and of evidence from giving weight to the only evidence offered to prove future damages; (3) the evidence offered to prove future damages was no more than a mere scintilla; and (4) the evidence established conclusively the absence of future damages. ANALYSIS Standard of Review and Applicable Law When reviewing the jury’s verdict for legal sufficiency, we view the evidence in the light most favorable to the finding and indulge every reasonable inference that would support it. City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005); Briones v. Brazos Bend Villa Apartments, 438 S.W.3d 808, 814 (Tex. App.—Houston [14th Dist.] 2014, no pet.). We credit evidence that supports the verdict if reasonable jurors could, and we disregard contrary evidence unless reasonable jurors could not. City of Keller, 168 S.W.3d at 827. Evidence is legally sufficient if it would enable a reasonable and fair-minded person to reach the verdict. Briones, 438 S.W.3d at 814. We sustain a legal sufficiency or “no evidence” challenge only when (1) the record discloses a complete absence of evidence of a vital fact; (2) the court is barred by rules of law or of evidence from giving weight to the only evidence offered to prove a vital fact; (3) the evidence offered to prove a vital fact is no more than a mere scintilla; or (4) the evidence establishes conclusively the opposite of the vital fact. Marathon Corp. v. Pitzner, 106 S.W.3d 724, 727 (Tex. 2003); Vast Constr., LLC v. CTC Contractors, LLC, 526 S.W.3d 709, 719 (Tex. App.—Houston [14th Dist.] 2017, no pet.). When a party challenges the legal sufficiency of the evidence on a finding on which it did not bear the burden of proof, the party must show that no evidence supports the finding. Exxon Corp. v. Emerald Oil & Gas Co., L.C., 348 S.W.3d 194, 215 (Tex. 2011); Sloane v. Goldberg B’Nai B’Rith Towers, 577 S.W.3d 608, 622 (Tex. App.—Houston [14th Dist.] 2019, no pet.). The jury as trier of fact is the sole judge of the credibility of the witnesses and the weight to be given to their testimony. Wilson, 168 S.W.3d at 819. Because we are not the fact finder, we may not substitute our own judgment for that of the trier of fact, even if we would reach a different answer on the evidence. GTE Mobilnet of S. Tex. Ltd. P’ship v. Pascouet, 61 S.W.3d 599, 615–16 (Tex. App.—Houston [14th Dist.] 2001, pet. denied). Generally, the measure of damages for breach of a contract is that which restores the injured party to the economic position he would have enjoyed if the contract had been performed. Parkway Dental Associates, P.A. v. Ho & Huang Properties, L.P., 391 S.W.3d 596, 607 (Tex. App.—Houston [14th Dist.] 2012, no pet.). This measure may include reasonably certain lost profits. Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 84 (Tex. 1992). The jury’s finding of losses that, in reasonable probability, will be sustained in the future is supported by legally sufficient evidence. Pura-Flo’s argument is two-fold. Pura-Flo first argues there is no evidence to support the jury’s answer to the future losses question because the Agreement, by its terms, was of indefinite duration and terminable at will by either party at any time. Pura-Flo concludes that it was not reasonable for the jury to determine that Clanton would sustain future damages on a contract that could be terminated at any time. Pura-Flo also argues that if future damages were recoverable, Clanton did not prove the amount of damages with reasonable certainty. The Agreement was not terminated by Pura-Flo’s breach. There is uncertainty as to the legal standard for determining the duration of an agreement that contains no express term. WesternGeco, L.L.C. v. Input/Output, Inc., 246 S.W.3d 776, 783 (Tex. App.—Houston [14th Dist.] 2008, no pet.). In some cases courts indicate that the implied term should be terminable at will, while in other cases courts have held that the implied term should be for a reasonable time. Id.; see also Clear Lake City Water Auth. v. Clear Lake Utilities Co., 549 S.W.2d 385, 390– 91 (Tex.1977). In Clear Lake City Water Authority, the Supreme Court of Texas noted both lines of cases. 549 S.W.2d at 390–91. The high court stated, however, that it did not need to decide which line of cases to follow because the court was required to imply the contract was terminable at will given that one of the parties was a governmental entity incapable of contracting for a reasonable time for performance. See id. Because the high court’s holding was based on one of the parties’ status as a governmental entity, Clear Lake City Water Authority is not on point in this case. Clanton cites Kennedy v. McMullen, 39 S.W.2d 168, 174 (Tex. Civ. App.— Beaumont 1931, writ ref’d), in which the court recognized that a contract indefinite as to the time of its performance may be terminated by either party by giving notice of his intention to do so. Id. The court, however, noted that under the facts of that case one of the parties continued to operate under the contract. Id. In other words, the court determined that a party cannot claim to terminate a contract, but continue to benefit from operating pursuant to the contract. In Kennedy, McMullen had a passenger bus route between the towns of Lufkin and Huntington. Id. at 169. Kennedy and a partner wanted to operate a passenger bus route from Lufkin to Beaumont, which necessarily would run through Huntington. Id. at 169. Rather than operate two competing bus lines on the same route the parties agreed that Kennedy would operate the bus route and pay McMullen a certain amount per passenger depending on how far the passenger traveled. Id. At 170. The contract contained no express provision as to how long it was to run. Id. Kennedy operated its buses for approximately one year, paying McMullen according to the terms of the contract. Id. at 171. After almost a year Kennedy notified McMullen that it would no longer pay McMullen under the contract, but Kennedy continued to operate its buses along the route. Id. McMullen sued Kennedy for breach of contract and the case proceeded to a bench trial. Id. The trial court concluded, inter alia, that the contract was not rendered unenforceable due to the lack of a specified term. Id. at 172. The court noted that, “Where no limitation is expressed in an agreement neither party can terminate it without consent of the other.” Id. The trial court construed the term of the contract to continue to be for the period Kennedy operated the bus line. Id. The court of appeals affirmed the trial court’s judgment. Id. at 174. The court noted that Kennedy repudiated the contract but continued to operate the bus line. Id. The court cited the general proposition that a contract indefinite as to the time of its performance may be terminated by either party by giving notice, but held that a party to a contract cannot terminate the contract where that party continues “to hold in his possession and operate for his own use and benefit the entire subject-matter of the contract, to the prejudice of the other party.” Id. Applying these principles to today’s case, as we stated above, the Agreement had no definite term, and like the contract in Kennedy, permitted continuation of the contract by mutual agreement. As the trial court found in Kennedy, the jury in this case found that Pura-Flo breached the Agreement but did not terminate it. The jury resolved the issue of the subject matter of the Agreement by finding that the Agreement was a contract for services, i.e., for rental income rather than physical water coolers. These findings are consistent with a determination that Pura-Flo repudiated the agreement but continued to operate under the Agreement by renting water coolers to Clanton’s customers and collecting rental income from those customers. Thus, as in Kennedy, the indefinite term of the Agreement did not cause it to be unenforceable. Pura-Flo continued to hold possession of the subject matter of the Agreement—Clanton’s rental units—and operate for its own use and benefit by collecting rental income, to the prejudice of Clanton. Because Pura-Flo continued to operate under the Agreement, the agreement was not terminated and Clanton was entitled to seek reasonably certain future losses to place him in the economic position he would have enjoyed had the Agreement been performed. See Parkway Dental, 391 S.W.3d at 607–08. Clanton established future losses with reasonable certainty. Lost profits damages can be recovered only when both the fact and amount of damages is proved with reasonable certainty. Horizon Health Corp. v. Acadia Healthcare Co., Inc., 520 S.W.3d 848, 860 (Tex. 2017). This principle recognizes that a party to a contract who properly claims future damages has been harmed in a current, real sense, in that his or her expectations regarding the contract have been diminished. Dixon v. Modelist, 157 S.W.3d 454, 456 (Tex. App.—Houston [14th Dist.] 2004, no pet.). Recovery for lost profits does not require that the loss be susceptible to exact calculation. Texas Instruments, Inc. v. Teletron Energy Mgmt., Inc., 877 S.W.2d 276, 279 (Tex. 1994). However, the injured party must do more than show that it suffered some lost profits. Id. at 279. The loss amount must be shown by competent evidence with reasonable certainty. Szczepanik v. First S. Trust Co., 883 S.W.2d 648, 649 (Tex. 1994); Heine, 835 S.W.2d at 84. This is a fact-intensive determination. Heine, 835 S.W.2d at 84. At a minimum, opinions or lost-profit estimates must be based on objective facts, figures, or data from which the lost-profits amount may be ascertained. Szczepanik, 883 S.W.2d at 649; Heine, 835 S.W.2d at 84. Under the “reasonable probability rule” for future damages, Texas courts consistently have held that the award of future damages rests within the sound discretion of the jury. Pascouet, 61 S.W.3d at 617. The jury awarded Clanton $50,000 for “loss that, in reasonable probability, will be sustained in the future.” Pura-Flo argues that the only evidence offered to support lost profits was Clanton’s testimony about the amount of money he would need to invest to secure a $9,000 per year stream of income. The jury heard evidence that from the date Clanton purchased the Agreement to the final payment he received from Pura-Flo in 2016, Clanton received a monthly check from Pura-Flo, which was the rental income from the 50 water cooler customers less $17.00 per month for maintenance and any deductions for repossession and replacement of water coolers. Clanton received no income from the Agreement in 2017 or 2018. Clanton testified that over 14 years, he averaged $9,000 per year in profits under the Agreement. At the time of trial, he had lost two years’ profits. Past profits, coupled with other facts and circumstances, may establish a lost-profits amount with reasonable certainty. Helena Chem., 47 S.W.3d at 505; JPMorgan Chase Bank, N.A. v. Prof’l Pharmacy II, 508 S.W.3d 391, 429 (Tex. App.—Fort Worth 2014, no pet.). After Pura-Flo stopped paying Clanton Pura-Flo continued to collect $35.00 per month from Clanton’s rental customers. Clanton, a CPA, testified that Pura-Flo’s breach deprived him of “the $9,000 a year income stream.” In quantifying an amount that would replace those lost profits, Clanton testified that a $300,000 certificate of deposit earning three percent per year would yield $9,000. In other words, Clanton testified that $300,000, “if paid now in cash” would replace his income stream. The Agreement permitted Pura-Flo to buy out Clanton for $20,000; Vanderzyden’s initial investment was $50,000. The jury also had before it Plaintiff’s Exhibit 6, which was the original Rental Information Package provided to Vanderzyden. The “Investment Proposal” compared “WEC’s 5 year growth program with a 5 year Certificate of Deposit in the amount of $50,000 with an estimated yield of 4% at term.” The Investment Proposal included a comparison of “rental profits vs. CD profits.” The Investment Proposal provided options after the initial 60-month term. The first option provided for continuation of the rental program. The second option provided that WEC could re- purchase each unit, giving the investor a net gain of $50,259. The testimony of Clanton, and the evidence admitted at trial, provided the jury with objective figures and data sufficient to support the jury’s finding of lost profit damages The jury has considerable discretion to determine how much, if any, future damages to award. Pascouet, 61 S.W.3d at 617. From the testimony and evidence before the jury, it could have determined that $50,000 was a reasonable amount to compensate Clanton for future lost profits. Viewing the evidence in the light most favorable to the jury’s finding and indulging every reasonable inference that would support it, we conclude the evidence is legally sufficient to establish with reasonable certainty Clanton’s damages for future losses as a result of Pura-Flo’s actions. See Ramco Oil & Gas Ltd. v. Anglo-Dutch (Tenge) L.L.C., 207 S.W.3d 801, 808 (Tex. App.—Houston [14th Dist.] 2006, pet. denied) (“Profits are not required to be exactly calculated; it is sufficient that there be data from which they may be ascertained with a reasonable degree of certainty and exactness.”). Accordingly, we overrule Pura-Flo’s issues on appeal. CONCLUSION Having overruled Pura-Flo’s issues on appeal, we affirm the trial court’s judgment. /s/ Jerry Zimmerer Justice Panel consists of Chief Justice Frost and Justices Zimmerer and Poissant (Frost, C.J., dissenting).
