Tennessee Business Litigation Law Blog

A recent opinion from the Tennessee Court of Appeals highlights the burden that lies with a defendant who is attempting to prove mitigation of damages.  In ABC Painting Co. v. White Oaks Apartments, the plaintiff brought suit for defendant’s failure to pay over $21,000.00 in invoices for painting work done at defendant’s apartment units.  The defendant counterclaimed that the plaintiff had not done the painting in a “workmanlike manner” as required by the parties’ contract.

At a bench trial, the plaintiff produced invoices for completed work, each of which was signed by the defendant, documenting the full amount of damages sought.  Further, plaintiff introduced testimony that the defendant had never complained about substandard work and plaintiff had promptly done any touch-up work requested.

In response, the defendant offered testimony that, according to their estimation, approximately 75% of the apartment units were painted in a substandard manner.  However, defendants failed to keep any documentary evidence to back up this allegation.  Additionally, while the defendant claimed that another painter had been hired to fix the substandard paint jobs, the invoices submitted from this second painter predated any of the work done by the plaintiff.  This second painter did testify that a number of the apartments were painted in a substandard manner, but he could not specify which apartments these were or document how much money he had been paid to correct the plaintiff’s work.

The trial court awarded the plaintiff $13,500.00 for the unpaid work, as well as a portion of their attorney’s fees pursuant to the terms of the contract.  On appeal, this decision was reversed and the plaintiff was awarded the full amount of their damages.  The Court of Appeals noted: 

Although the party seeking damages has the burden of proving those damages, the burden is on the defendants who breached the contract to prove what amounts should be offset in mitigation of damages. And “[w]hile there is no mathematical formula for calculating damages, the proof of damages must be as certain as the nature of the case permits and must enable the trier of fact to make a fair and reasonable assessment of the claimed damages.” (citations omitted)

Based on the foregoing, the court found that the defendant’s proof of mitigation was speculative and unsubstantiated by a preponderance of the evidence and awarded the full value of the plaintiff’s damages.

Read the entire opinion here.

The recent case of In re Estate of Drewry E. Haskins, Jr. from the Eastern Section of the Court of Appeals deals with the requirements for a verbal contract under Tennessee law, but the interesting part of the case focuses on the credibility of witnesses. In Haskins, the case was tried before a special master in 1999, with the special master finding the plaintiff failed to prove the existence of an oral contract.  More than four years later, and after being instructed to do so by the Chancellor, the special master amended his report to consider the testimony of several additional witnesses. The master found the testimony of each of these witnesses “not to be credible in this action as a result of her affect and her interest," and again found no oral contract existed. 

The plaintiff appealled, arguing that “the Special Master made a determination of credibility of multiple witnesses...fifty-six months after hearing."  The plaintiff further argued that "no finder of fact can make any appropriate finding of credibility more than four and one-half years after the hearing in
question.” The Court of Appeals rejected the plaintiff's argument outright, noting that credibility is determined during the trial even if recorded in an order or report years later.  Moreover, even with the passage of time the trial court remains better equipped to judge the credibility of witnesses than an appellate court reviewing the transcript alone.

One final important point made by the Court of Appeals is that a trial court need not accept as true a witness's testimony merely because it is not directly contradicted, impeached, or discredited. In other words, a witness's testimony that the sky is yellow and the sun is blue need not be accepted as fact merely because it is not attacked on cross-examination. 

John Day posted on Day on Torts this morning about the admissibility of computerized records at trial. According to this law.com article mentioned in the post, a new 9th Circuit Bankruptcy Appellate Panel opinion ups the ante for the testimony required to authenticate and admit computer records. Specifically, the 9th Circuit's decision in In re: Vinhnee, 2005 WL 3609376 (B.A.P. 9th Cir. Dec. 16, 2005) would appear to require more than the traditional proof that the records are kept contemporaneously in the ordinary course of business. Instead, the courts appear to be moving toward requiring competent foundational testimony regarding how the computer hardware and software maintains the data.

Evan Shaeffer passes along a tip for litigators: start a memo early in a lawsuit and keep track of evidentiary issues as they arise. Although you will still end up poring over the entire file during final trial preparation, at least you can focus on presenting evidence. Evan specifically mentions a list of motions in limine to exclude evidence, but I'd take it a step further and keep a running tally of briefs you will need to draft in favor of evidence as well. If you've got evidence of post-incident changes, for example, you might as well plan on a bench brief to explain why it is not a subsequent remedial measure or why it is admissible notwithstanding Rule 407.

Evan Schaeffer posts on his Illinois Trial Practice blog a couple of tips for establishing the authenticity of documents before trial using admissions. If you are going to try authenticating evidence through stipulations or admissions, though, consider breaking down each step in the foundation of the evidence. For example, a business record may still contain other hearsay in it, such as a note that the customer wanted to buy the product. The parties may agree to the authenticity of the business record, but not its admissibility because of the hearsay statement by the customer. If you ask your opponent to stipulate or admit to each step in the foundation, though, you can at least narrow down what issues will need to be addressed at trial.

Here's a good tip from Evan Schaeffer: if you are preparing for trial in a court that allows pre-marking of exhibits, then number your documents based on importance. In other words, mark the document that you want the jury to concentrate on most as number 1, and work your way down from there. Combine this technique with a pre-packaged exhibit notebook (or CD-Rom under the right circumstances) for the jury to try and keep their attention focused during deliberations.

Digital cameras are now the norm, but occassionally questions come up regarding the admissibility of digital photos as evidence in a lawsuit. The short version is that a digital photo is admissible under the same rules as any other photograph, videotape, or drawing - if a witness with knowledge confirms that it fairly and accurately represents what it is being introduced to prove. Also as with a regular photo or video, if it has been generated automatically (such as by a surveillance camera), then a person with knowledge needs to testify about the manner in which the camera was set up.

Any other issues should go to the weight, not the admissibility, of a digital photo as evidence. For a list of some of those issues, take a look at this article. For example, they mention the compression ratio used on the camera (reduces image quality and can leave out important details), the "chain of custody" of persons and machines that the photos have been passed through en route to trial, and any changes such as contrast settings to sharpen the image that might actually distort it. The authors discuss these issues in the realm of admissibility, but again, they really should be factors for the jury to consider in weighing the evidence. One fundamental piece of advice from the article: if you touch up the photo for clarity reasons, make sure to preserve the original so the jury can compare and confirm that the changes are incidental.