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`NO. 17-0762
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`MUSA (“MOSES”) N. MUSALLAM, PETITIONER,
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`v.
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`AMAR B. ALI, RESPONDENT
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`4444444444444444444444444444444444444444444444444444
`ON PETITION FOR REVIEW FROM THE
`COURT OF APPEALS FOR THE SECOND DISTRICT OF TEXAS
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`Argued September 13, 2018
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`JUSTICE JOHNSON delivered the opinion of the Court.
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`Musa “Moses” Musallam and Amar Ali entered into a written agreement relating to the sale
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`of Musallam’s business to Ali. Musallam refused to close, maintaining that the agreement lacked
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`essential elements of a binding contract and was thus only an agreement to agree. The case was tried
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`to a jury. Musallam requested a jury question asking whether he and Ali had agreed to the sale of
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`the business, and, naturally, did not object to the trial court’s including the question in the jury
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`charge. The jury found that they had agreed. By motion for judgment notwithstanding the verdict,
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`Musallam challenged that answer.
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`The trial court denied Musallam’s motion and rendered judgment for Ali. Musallam
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`appealed, in part, challenging the jury’s finding that he agreed to sell the business to Ali. The court
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`of appeals determined that because Musallam did not object to the question, he failed to preserve
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`error to challenge either its inclusion in the charge or the jury’s answer to it. We disagree with the
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`court of appeals. Accordingly, we reverse and remand to that court.
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`I. Background
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`Musallam owns Fanci Candy, Inc., a wholesale distributer of candy and tobacco products.
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`At times relevant to this matter, Fanci Candy had contracts to buy tobacco products directly from
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`Altria Group Distribution Company (the owner of Philip Morris and U.S. Tobacco) and Lorillard
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`Tobacco Company. In April 2012, Musallam approached Ali, the vice president of convenience
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`store distribution business A to Z Wholesalers, Inc., about purchasing Fanci Candy. A to Z
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`Wholesalers did not have a direct contract with either Altria or Lorillard, thus it bought those
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`companies’ tobacco products through middlemen and paid higher prices for them than did Fanci
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`Candy. Because Altria and Lorillard ordinarily would not enter into new contracts to sell directly
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`to wholesalers, businesses that wanted to buy directly from them usually sought to do so by buying
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`companies that had direct contracts. But the Altria and Lorillard direct-purchase contracts would
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`not necessarily transfer if Fanci Candy was sold: both Altria and Lorillard reserved the right to
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`discontinue direct sales to Fanci Candy absent their approval of its purchaser.
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`Ali and Musallam reached an agreement regarding the sale of Fanci Candy and signed a
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`letter of intent.1 The closing date was listed as “[i]mmediate, subject to preapproval” from Altria
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`and Lorillard. Altria initially refused to approve the application to transfer Fanci Candy’s
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`ownership, but did so after Ali and Musallam resubmitted the application.
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`1 The letter of intent listed A to Z as the buyer, but also provided that A to Z could assign its rights. Ali testified
`that he and Musallam chose to state that A to Z was the buyer because it was a stronger candidate as a purchaser that
`they believed the tobacco companies would be more inclined to approve.
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`2
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`While waiting on approval from Lorillard, Ali and Musallam executed a Stock Transfer and
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`Asset Purchase and Sale Agreement (Stock Transfer Agreement, or Agreement) by which Musallam
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`agreed to sell to Ali all Fanci Candy stock shares along with other assets used in the business such
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`as land, buildings, inventory, vehicles, fixtures, and equipment. The purchase price for the stock
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`was $500,000, subject to the contingency that if Musallam was unable to obtain written approval
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`from both Altria and Lorillard for the direct contracts to remain in force, the price would be reduced
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`to $250,000. Because Altria had approved the change of ownership, the sales price hinged on
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`Lorillard’s approval. The Stock Transfer Agreement provided that the sales price for the furniture,
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`fixtures, and equipment such as stamping and packing machines would be their value “as mutually
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`agreed upon by the parties prior to the Closing Date,” and the price of the land and building would
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`be the value set by an appraisal to be accomplished before the closing date. Closing was to take
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`place on or before July 1, 2013.
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`On June 28, 2013, Lorillard notified Ali that it would not approve the change in ownership.
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`Musallam and Ali discussed resubmitting the application to Lorillard as they had done with Altria.
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`Musallam also proposed postponing the July 1 closing date, but Ali would not agree to the change.
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`At that point, Musallam and Ali had not come to an agreement as to the value of the furniture,
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`fixtures, and equipment, and Musallam disputed the value of the land and building as determined
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`by the appraisal.
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`Ali appeared for the closing on July 1, but Musallam did not. Instead, on July 2, Musallam
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`sued Ali seeking a declaratory judgment that (1) the Stock Transfer Agreement was unenforceable
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`and void because the parties did not agree on all its essential terms, and (2) Musallam had not
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`3
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`breached the Agreement. Ali counterclaimed, asserting various claims including a claim for
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`damages because Musallam had indeed breached the Agreement.
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`The case was tried to a jury. The trial court submitted the following question and
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`instructions as part of the jury charge:
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`Question No. 1
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`Did Moses Musallam and Amar Ali agree to the sale and transfer of Fanci
`Candy Company in the Stock Transfer and Asset Purchase and Sale Agreement?
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`In deciding whether the parties reached an agreement, you may consider what
`they said and did in light of the surrounding circumstances, including any earlier
`course of dealing. You may not consider the parties’ unexpressed thoughts or
`intentions.
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`If Moses Musallam and Amar Ali agreed to other essential terms but failed
`to specify price, it is presumed a reasonable price was intended.
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`Answer “Yes” or “No.”
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`Musallam requested the submission, while Ali objected to it. Ali argued that “the evidence is clear
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`and unequivocal that both parties signed the stock transfer and asset purchase agreement” and there
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`was no question that Ali and Musallam reached an agreement. In response to Ali’s objection,
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`Musallam asserted that when an agreement leaves material terms open for future adjustment it is not
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`binding but constitutes merely an agreement to agree. He argued that whether the price for furniture,
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`fixtures, equipment, and other open issues were material terms was a fact question for the jury that
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`must be determined before the court could decide the legal question of whether the Stock Transfer
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`Agreement was a binding contract or merely an agreement to agree.
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`4
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`The jury answered Question 1 “Yes,” and found in response to Question 2 that Musallam
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`failed to comply with the Stock Transfer Agreement. The jury also found that Ali suffered $904,924
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`in lost profit damages. The trial court rendered judgment for Ali based on the jury’s findings and
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`also awarded attorney’s fees to Ali.
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`Musallam filed a Motion for New Trial and a Motion for Judgment Notwithstanding the
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`Verdict or, in the Alternative, Motion to Disregard. In his motion for judgment notwithstanding the
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`verdict, Musallam asked the court to disregard all the jury findings and render judgment that no
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`contract existed between the parties. He asserted that Question 1 and the jury’s answer to it should
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`be disregarded because (1) whether the Stock Transfer Agreement was an enforceable contract was
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`a question of law, and (2) the evidence conclusively proved that the Stock Transfer Agreement was
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`merely an unenforceable agreement to agree because it left key elements of the total purchase price
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`open for further negotiation. The trial court denied Musallam’s motions.
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`In the court of appeals Musallam asserted that (1) the Stock Transfer Agreement was an
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`“agreement to agree” and not a binding enforceable agreement, (2) insufficient evidence supported
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`the jury’s finding for lost profits on Ali’s breach of contract claim, and (3) the trial court erred by
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`failing to submit a question in the jury charge. The court of appeals affirmed. ___ S.W.3d ___ (Tex.
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`App.—Fort Worth 2017). Regarding enforceability of the Stock Transfer Agreement, the court of
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`appeals stated that it understood Musallam’s argument to be that “[The jury’s] finding [on Question
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`No. 1] should be disregarded as immaterial because whether a particular agreement is an enforceable
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`contract is a question of law.” Id. at ___. The court noted that a jury question may be deemed
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`immaterial and disregarded if it calls for a finding beyond the province of the jury, such as on a
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`5
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`question of law. Id. (citing Spencer v. Eagle Star Ins. Co. of Am., 876 S.W.2d 154, 157 (Tex.
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`1994)). However, the appeals court did not address Musallam’s argument. It agreed with Ali that
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`Musallam failed to preserve error as to Question 1 because he did not object to its submission. Id.
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`at ___. The court also determined that the evidence of lost profits was sufficient to support the
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`jury’s award, and that Musallam’s issue regarding the trial court’s failure to include a question in
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`the jury charge was inadequately briefed and thus waived. Id. at ___ n.3, ___.
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`In this Court, Musallam’s prime argument is that the court of appeals erred by failing to
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`address the merits of his assertion that the Agreement was an unenforceable agreement to agree. He
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`claims that his failure to object to Question 1 did not preclude him from later arguing either that the
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`jury’s finding was not supported by the evidence, or that as a matter of law the Stock Transfer
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`Agreement was an unenforceable agreement to agree. We agree with Musallam.
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`II. Discussion
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`We first address Musallam’s assertion that his failure to object to Question 1 did not preclude
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`him from later challenging the sufficiency of the evidence to support the jury’s answer to it.
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`Texas Rule of Civil Procedure 279 provides that “[a] claim that the evidence was legally or
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`factually insufficient to warrant the submission of any question may be made for the first time after
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`verdict, regardless of whether the submission of such question was made by the complainant.”
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`While a party may preserve a no evidence issue by objecting to submission of the issue to the jury,
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`a motion for judgment notwithstanding the verdict or motion to disregard the jury’s answer will also
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`preserve error. Steves Sash & Door Co., Inc. v. Ceco Corp., 751 S.W.2d 473, 477 (Tex. 1988).
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`Accordingly, by requesting Question 1 Musallam did not forfeit the right to later challenge the legal
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`6
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`sufficiency of the evidence to support it. See Simon v. Henrichson, 394 S.W.2d 249, 257 (Tex. Civ.
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`App.—Corpus Christi 1965, writ ref’d n.r.e.) (“Objection of no evidence can be made for the first
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`time after verdict, regardless of whether the submission of such issue was requested by the
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`complaining party or not.” (citing TEX. R. CIV. P. 279)).
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`Next we consider whether Musallam’s failure to object to Question 1 precluded him from
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`later challenging the jury’s answer to it as being immaterial.
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`Trial courts may disregard a jury finding if the finding is immaterial. See USAA Tex. Lloyds
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`Co. v. Menchaca, 545 S.W.3d 479, 505 (Tex. 2018) (citing Spencer, 876 S.W.2d at 157). Ali
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`contends that, as the court of appeals determined, Musallam’s complaint is about jury charge error
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`and he was required to raise it by objecting to the charge. ___ S.W.3d at ___ (citing TEX. R. CIV.
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`P. 272–74). However, a complaint that a jury’s answer is immaterial is not a jury charge complaint.
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`See BP Am. Prod. Co. v. Red Deer Res., LLC, 526 S.W.3d 389, 402 (Tex. 2017). Accordingly, a
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`party need not object to a jury question to later argue that it is immaterial. Id. (“BP preserved error
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`on the immateriality issue by raising these concerns post-verdict in a motion for judgment in
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`disregard, in a motion for judgment notwithstanding the verdict, and in a motion for new trial.”); see
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`Nat’l Plan Adm’rs, Inc. v. Nat’l Health Ins. Co., 235 S.W.3d 695, 703–04 (Tex. 2007). The court
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`of appeals erred by holding otherwise.
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`Having concluded that Musallam’s failure to object to Question 1 did not forfeit his right to
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`later challenge submission of the question and the jury’s answer to it, we turn to Musallam’s
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`assertion that he never had a binding and enforceable agreement with Ali. As already noted, the
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`court of appeals did not address the issue, concluding that Musallam waived it.
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`7
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`If a party raises an issue in this court that was briefed but not decided in the court of appeals,
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`we may either remand the case to the court of appeals to consider the issue or consider it ourselves.
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`TEX. R. APP. P. 53.4. Musallam urges us to consider the issue and render judgment in his favor,
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`asserting that the evidence clearly establishes there was no agreement between the parties.
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`However, he simply references pages of his brief in the court of appeals in support of his position.
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`Given the posture of the case and the arguments, we conclude that the appropriate disposition is to
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`remand to the court of appeals for it to first address issues properly preserved but which we have not
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`addressed. See First Bank v. Brumitt, 519 S.W.3d 95, 112 (Tex. 2017) (“Because First Bank has not
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`addressed the sufficiency-of-the-evidence issue in its briefing to this Court, we believe it is better
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`to remand for the court of appeals to consider and address the issue in the first instance.”).
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`III. Conclusion
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`Musallam’s requesting jury Question 1 did not preclude him from later challenging the jury’s
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`answer to that question. Because the court of appeals held otherwise, we reverse its judgment and
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`remand to that court for further proceedings.
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`________________________________________
`Phil Johnson
`Justice
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`OPINION DELIVERED: October 26, 2018
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`8
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