Background
Merco Group at Akoya, Inc. developed the Akoya condominium, while General Computer Services, Inc. developed BeCruising, a computer system connecting condominium units with building services. Under a 2003 contract, GCS was to provide the system for subscribing units, and Merco was to market it to owners and prospective buyers. GCS sued Merco in 2006 for breach of contract and quantum meruit, alleging that it performed but was not paid.
After two earlier appeals and remands, the case proceeded to a third trial limited to damages. GCS sought $802,898.98 based on invoices and contracts with salesperson Arnaldo Salas and programmer Jose Barcena. The jury awarded $602,898, and the trial court denied Merco’s request for remittitur. The court later awarded GCS $916,281.90 in prejudgment interest dating from December 6, 2006.
The Court’s Holding
The Third District held that the trial court abused its discretion by denying remittitur because the jury’s damages award was not supported by the trial evidence. GCS’s owner testified that GCS never paid Barcena and paid Salas only approximately $200. GCS therefore failed to prove actual losses equal to the compensation amounts stated in those contractors’ agreements.
The evidence supported no more than $108,898.98 in invoiced out-of-pocket expenses plus $200 paid to Salas, for total damages of $109,098.98. The court directed the trial court to offer GCS a remittitur to that amount; if GCS refuses, the trial court must order a new trial limited to damages. If GCS accepts, prejudgment interest must be recalculated using the reduced damages award. The court otherwise affirmed the final judgment and the entitlement to and calculation method for prejudgment interest.
Key Takeaways
- A damages award cannot include contractual payment obligations that the claimant did not prove it actually paid or otherwise sustained as losses.
- The highest damages amount supported by the evidence was $109,098.98, consisting of documented expenses and approximately $200 paid to Salas.
- GCS must choose between accepting the remittitur and proceeding to another trial limited to damages; acceptance also requires recalculation of prejudgment interest.
Why It Matters
The decision underscores that even after liability has been established, a breach-of-contract plaintiff must prove its actual damages with evidence rather than rely on the face value of third-party contracts. When a verdict exceeds the highest amount supported by the record, remittitur may be required.
The ruling also illustrates the effect of reducing the principal award on prejudgment interest: entitlement may remain intact, but the interest judgment must be recalculated from the remitted damages amount.