Boy Scouts of America v. Responsive Terminal Systems, Inc.

790 S.W.2d 738, 1990 WL 87643
CourtCourt of Appeals of Texas
DecidedApril 30, 1990
Docket05-86-00936-CV
StatusPublished
Cited by71 cases

This text of 790 S.W.2d 738 (Boy Scouts of America v. Responsive Terminal Systems, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Boy Scouts of America v. Responsive Terminal Systems, Inc., 790 S.W.2d 738, 1990 WL 87643 (Tex. Ct. App. 1990).

Opinion

OPINION ON REMAND

THOMAS, Justice.

This lawsuit involves a business relationship between Boy Scouts of America (BSA) and Responsive Terminal Systems, Inc. (RTS). Nearly every aspect of that relationship appears to have been in dispute at the trial court level, and the evidence from both sides is inconclusive as to the true understanding between the entities, if, in fact, they ever had a basic consensus regarding their business dealings. Since we hold that the trial court erred in finding BSA liable under RTS’s promissory estop-pel and breach of contract claims, we reverse and remand this cause, in part, for a new trial. As to BSA’s award of damages for overcharges made by RTS to BSA and local Boy Scout councils, we affirm the recovery of overcharges made directly to BSA. We reverse the trial court’s judgment with regard to BSA’s recovery of damages on behalf of the local councils, and render in favor of RTS on that point. We further reverse and render as to BSA’s award of attorney’s fees.

In 1979, BSA, the National Council of the Boy Scouts organization, moved its headquarters to Irving, Texas. In addition to this national office, there are over 400 separately incorporated local Boy Scout councils throughout the United States. Shortly after moving to Irving, BSA became interested in computerizing many of its tasks, including its communications with local councils, and began working with RTS toward those ends. In November of 1982, the two entities signed an Agreement of Understanding (Agreement) wherein RTS agreed to prepare software for BSA to be used on the 990 series Texas Instruments computer hardware and other hardware provided by RTS. This software, with one exception, was to be supplied to BSA at no charge. RTS further agreed to pass all rights to such software to BSA for its specific use. The Agreement also provided that if a local council did not buy its hardware from RTS, RTS could bill the individual council a maximum of $2000 for configuration and installation fees, plus travel and living expenses. If a council did buy its Texas Instruments hardware from RTS, it would receive a fifteen percent discount from the list price.

*741 Following the execution of the Agreement, RTS sold computer hardware to a number of local councils, and installed software, only, for several more. Then, in early 1984, a partial revamping of the internal workings of the BSA led to a shift in the division of the organization which would oversee its computer operations. After this shift, the director of the newly responsible Information Systems Division, Susan Spatter, solicited competitive bids from companies within the computer industry in an attempt to choose one vendor of such products to be used by BSA and recommended to local councils. Although it is unclear as to when RTS was actually informed about this competitive bidding, it is undisputed that RTS submitted a bid and was rejected in favor of another vendor in late August, 1984.

Within a month of BSA’s rejection of its bid, RTS filed this lawsuit claiming, in pertinent part, that BSA had breached the Agreement by using the software provided by RTS on computer hardware other than that sold by RTS, and by denying or hindering RTS in its efforts to provide configuration and installation services to local councils. In the alternative, RTS claimed that the Agreement was without consideration or that such consideration failed in whole or in part. Additionally, RTS pled a cause of action under promissory estoppel, alleging that BSA had requested that RTS maintain an inventory of computer equipment and software in order to serve the local councils in a timely manner, and that BSA promised to pay for such equipment and software. RTS claimed that it was foreseeable that it would rely on such a promise and that RTS did, in fact, rely to its detriment. A number of damage formulas were also set forth by RTS in its pleadings, including lost profits, recovery of the software or its monetary value, and reimbursement of the reasonable value of computer inventory it had in stock at the time BSA chose another vendor.

BSA counterclaimed against RTS, likewise citing a breach of the Agreement because of certain alleged overcharges by RTS to BSA and to the local councils. A trial before the court resulted in RTS being awarded $81,150 under both breach of contract and promissory estoppel theories. BSA was held to be entitled to a $16,576 set-off because of overcharges. Both parties were awarded attorney’s fees.

BSA appealed to this Court, urging fifteen points of error. RTS, in turn, raised fourteen cross-points. In an unpublished opinion, we reversed the judgment of the trial court and rendered judgment for BSA, holding that there was no competent evidence to support the judgment for RTS under either breach of contract or promissory estoppel. This Court also affirmed the trial court’s judgment awarding BSA damages on its counterclaims, because we concluded that this Court lacked jurisdiction to consider RTS’s cross-points.

In reversing the decision of this Court in a per curiam opinion the supreme court held that, although we had used the proper test in reviewing a no evidence point, this Court had erred in holding that there was no evidence to support RTS’s recovery based upon promissory estoppel. The court held that there was more than a scintilla of evidence to support the trial court’s finding that (1) RTS had detrimentally relied on BSA's alleged promise to name RTS as its vendor of choice, and (2) BSA had expected RTS to maintain an inventory of computer hardware sufficient to meet BSA’s requirement that RTS be able to fill orders for local councils within thirty days. The supreme court further held that this Court erred in dismissing RTS’s cross-points for want of jurisdiction because, under the court’s simultaneously decided opinion in Donwerth v. Preston II Chrysler-Dodge, Inc., 775 S.W.2d 634, 639 (Tex.1989), an appellee may complain by cross-points in its brief to a court of appeals of any error in the trial court between the appellant and the appellee, without perfecting an independent appeal, unless the appellant limits its appeal pursuant to rule 40(a)(4) of the Texas Rules of Appellate Procedure. The court then remanded the case to this Court for rulings on BSA’s remaining points of error and RTS’s cross-points. Although a motion for rehearing was filed by RTS specifically requesting *742 that the supreme court also review this Court’s holding that there was no evidence to support RTS’s breach of contract cause of action, the court did not address that issue. 1

PROMISSORY ESTOPPEL

Since the supreme court has already considered and rejected BSA’s no evidence contention as to RTS’s promissory estoppel claim, which BSA set forth in its first point of error, we will begin our analysis with BSA’s second point of error in which BSA argues that “[t]he trial court erred in awarding RTS damages on a theory of promissory estoppel because there are no fact findings that BSA made a promise to RTS; that RTS substantially relied on such promise; that it was foreseeable that RTS would rely on such promise; or that injustice could be avoided only by enforcement of such promise.” The four factors upon which BSA alleges that the trial court made no findings of fact mirror the elements required to invoke the doctrine of promissory estoppel as set forth in English v. Fischer,

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Bluebook (online)
790 S.W.2d 738, 1990 WL 87643, Counsel Stack Legal Research, https://law.counselstack.com/opinion/boy-scouts-of-america-v-responsive-terminal-systems-inc-texapp-1990.