Lost Profits, Income, Consequential Damages
Lost profits, income or revenue often form a major component of a plaintiff’s damages in business disputes, contract disputes and employment disputes. Loss of profits generally means the amount of money a plaintiff would have realized but for the Defendant’s conduct. Meridian Enters. Corp. v. KCBS, Inc., 910 S.W.2d 329, 331 (Mo. Ct. App. 1995). For a business plaintiff to recover lost profits, it must demonstrate that the profits were “reasonably certain” by proof of actual facts, with present data for a rationale estimate of their amount. Coonis v. Rogers., 155 S.W.3d 50 (Mo. 2005). When seeking damages to compensate for loss of profits from the interruption of an established business, proof of the income and expenses of the business for a reasonable time prior to its interruption is necessary.
The measure of proof required to obtain lost profits may change depending on the type of claim. For instance, if a plaintiff sues for damages arising directly out of a breach of contract, the plaintiff does not need to prove past profits or expenses. Harvey v. Timber Resourcees, Inc., 37 S.W.3d 814, 818 (Mo. Ct. App. 2001). This is because when the loss is ascertainable with reasonable certainty from the breach and the profits claimed are not speculative or conjunctural, a plaintiff may seek lost profits arising from a breach of contract.
When estimating lost profits, the law requires that it be supported by the best evidence available. Refrigeration Industries, Inc. v. Nemmers, 800 S.W.2d 912, 920 (Mo. Ct. App. 1994). A plaintiff produces the best available evidence when he/she produces all relevant facts tending to show the extent of damages. Usually a business owner’s own testimony, in conjunction with documentation reflecting past cash flow, is sufficient evidence of lost profits.