Texas Causes of Action & Affirmative Defenses

Texas Causes of Action & Affirmative Defenses

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Friday, July 1, 2011

July 1, 2011 Texas Supreme Court releases flurry of opinions

Supreme Court Building in Austin

The Supreme Court of Texas released opinions in 12 cases today; - too many to quickly mine for caselaw nuggets on causes of action and affirmative defenses suitable for posting here. The acutal number of separate opinion is even larger due to multiple concurrences and dissents.


The list follows below, with excerpts from the deciding opinions.

For more details and links to opinions in pdf on the Court's web site, click


MOST EYEBROW-RAISING IN TODAY'S CROP OF DECISIONS: Supremes offer supplemental answer to what [else] constitutes a health-care liability claim requiring an expert's certification of non-frivolousness:

Anthing-but-therapeutic SPIDER BITE AS MEDICAL MALPRACTICE - We kid you not. 


TORT REFORM IN ACTION:

Omaha Healthcare Center, LLC v. Johnson (Tex. 2011)

No. 08-0231 (Tex. Jul. 1, 2011)(Opinion by Justice Phil Johnson) (HCLC, med-mal suit, characterization of
claim)(expert report requirement applies to claim of negligent exposure to spider bite in nursing home).

In this case we consider whether claims against a nursing home regarding a patient’s death alleged to have been caused by a brown recluse spider bite are health care liability claims (HCLCs) that required an expert report to be served. The trial court and court of appeals held that they were not. We disagree.

Conclusion. Johnson’s claim is an HCLC and should have been dismissed. Because Omaha requested  its attorney’s fees and costs in the trial court pursuant to Civil Practice and Remedies Code section 74.351(b)(1), the case must be remanded. We grant Omaha’s petition for review. Without hearing oral argument we reverse the court of appeals’  judgment and remand the case to the trial court with instructions to dismiss Johnson’s claims and consier  Omaha’s request for attorney’s fees and costs.
Justice Debra Lehrmann delivered a dissenting opinion, in which Justice David Medina joined. [pdf]

CAVEAT PROPERTY OWNERS: Don't waive statutory remedy to recover stolen goods or compensation

Dallas City Hall
City of Dallas v. VSC, LLC (Tex. 2011)

No. 08-0265 (Tex. Jul. 1, 2011)(Opinion by Chief Justice Wallace B. Jefferson) (takings claim against government precluded given existence of statutory remedy)

We expect our government to retrieve stolen property and return it to the rightful owner. What happens, though, when a person claims an interest in property the government has seized? In this case, the
City of Dallas seized vehicles, which it alleged were stolen, from a company that was entitled to petition for  their return. See Tex. Code Crim. Proc. art. 47.01a(a). Instead of pursuing its statutory remedy, the  company sued, alleging that its interest in those vehicles had been taken without just compensation. We  hold that the availability of the statutory remedy precludes a takings claim. We reverse the court of appeals’ judgment and render judgment dismissing this suit.

Conclusion. VSC received all of the process to which it was entitled. A party cannot claim a lack of just  compensation based on its own failure to invoke a law designed to adjudicate such a claim. We reverse he
court of appeals’ judgment and render judgment dismissing the case. Tex. R. App. P. 60.2(c).
Justice Dale Wainwright delivered a dissenting opinion, in which Justice Phil Johnson and Justice Eva M.
Guzman joined.

UTILITIES REGULATION: Too arcane for the average light-switch flipper to comprehend

AEP Tex. Central Co. v. PUC (Tex. 2011)

No. 08-0634 (Tex. Jul. 1, 2011)(Opinion by Justice Don R. Willett)(PUC utilities law)

This appeal challenges a final order of the Public Utility Commission in a true-up proceeding under Chapter 39 of the Utilities Code, a part of the Public Utility Regulatory Act (PURA). The district court affirmed the order in part and reversed it in part. The court of appeals affirmed the judgment of the district court in part and reversed it in part.1 In two recent decisions, we have reviewed PUC orders in true-up proceedings, giving a general description of Chapter 39 and the true-up procedure

In today’s case, AEP Texas Central Co. (AEP), a transmission and distribution utility, and CPL Retail  Energy, L.P., its affiliated retail electric provider, initiated a proceeding under Section 39.262 to finalize stranded costs and other true-up amounts. The State of Texas, several municipalities, and several other  parties who are consumers of electricity or represent consumer interests (collectively the Consumers) intervened in the proceeding. In its final order (Order), the PUC determined stranded costs, which generally are “based on the  difference between the book value of generation assets and the market value of these assets.”5 The PUC  also made a separate determination of the capacity auction true-up under Section 39.262(d)(2). The issues before us now concern market value, net book value (NBV), and the capacity auction true-up.

Conclusion. We grant the petition for review, and without hearing oral argument, affirm in part and  reverse in part the court of appeals’ judgment, and remand this case to the PUC for further proceedings consistent with this opinion.

NUISANCE ABATEMENT: What rights and remedies does the property owner have?

City of Dallas v. Stewart (Tex. 2011)

No. 09-0257 (Tex. Jul. 1, 2011)(Opinion by Chief Wallace B. Jefferson) (administrative resolution of nuisance abatement dispute with municipality not preclusive, judicial review available to property owner, takings claim)

Urban blight threatens neighborhoods. Either as a risk to public health or as a base for illicit activity, dilapidated structures harm property values far more than their numbers suggest. Cities must be able to abate these nuisances to avoid disease and deter crime. But when the government sets up a mechanism to deal with this very real problem, it must nonetheless comply with constitutional mandates that protect a citizen’s right to her property.

Today we hold that a system that permits constitutional issues of this importance to be decided by an administrative board, whose decisions are essentially conclusive, does not correctly balance the need to abate nuisances against the rights accorded to property owners under our constitution. Independent court review is a constitutional necessity. We affirm the court of appeals’ judgment, but on different grounds.

Conclusion. That the URSB’s nuisance determination cannot be accorded preclusive effect in a takings  suit is compelled by the constitution and Steele, by Lurie and its antecedents, by the nature of the quesion and the nature of the right. The protection of property rights, central to the functioning of our society, should not—indeed, cannot—be charged to the same people who seek to take those rights away. Because we believe that unelected municipal agencies cannot be effective bulwarks against  constitutional violations, we hold that the URSB’s nuisance determination, and the trial court’s affirmance of  that determination under a substantial evidence standard, were not entitled to preclusive effect in Stewart’s  takings case, and the trial court correctly considered the issue de novo.
Justice Eva M. Guzman delivered a dissenting opinion, in which Justice Dale Wainwright, Justice Paul W.
Green, and Justice Phil Johnson joined. [pdf]


PRICING & DISCOUNTING OF MEDICAL CARE EXPENSES FOR DAMAGE CALCULATION PURPOSES - What can the court award?

Now we know how to crank out the numbers
Haygood v. Garza de Escabedo (Tex. 2011)

No. 09-0377 (Tex. Jul. 1, 2011)(Opinion by Justice Nathan L. Hecht) (what are reasonable health-care  expenses, what is incurred and recoverable?)

Damages for wrongful personal injury include the reasonable expenses for necessary medical care, but  it has become increasingly difficult to determine what expenses are reasonable. Health care providers set charges they maintain are reasonable while agreeing to reimbursement at much lower rates determined by insurers to be reasonable, resulting in great disparities between amounts billed and payments accepted. Section 41.0105 of the Texas Civil Practice and Remedies Code, enacted in 2003 as part of a wide-ranging package of tort-reform measures, provides that “recovery of medical or health care expenses incurred is limited to the amount actually paid or incurred by or on behalf of the claimant.” We agree with the court of appeals that this statute limits recovery, and consequently the evidence at trial, to expenses that the provider has a legal right to be paid.

Conclusion: [W]e hold that only evidence of recoverable medical expenses is admissible at trial. We disapprove the cases that have reached conflicting decisions. Of course, the collateral source rule continues to apply to such expenses, and the jury should not be told that they will be covered in whole or in part by insurance. Nor should the jury be told that a health care provider adjusted its charges because of insurance.
Justice Debra Lehrmann delivered a dissenting opinion, in which Justice David Medina joined. [pdf]


Paper ballots passé 
VIRTUAL-ONLY [paperless] VOTING MACHINES

Andrade v. NAACP of Austin (Tex. 2011)

No. 09-0420 (Tex. Jul. 1, 2011)(Opinion by Chief Wallace B. Jefferson)(challenge to electronic voting without a paper record being generated at the same time)

Technology is changing the way we vote. It has not eliminated controversy about the way votes are recorded and verified. We must decide whether voters have standing to pursue complaints about an electronic voting machine that does not produce a contemporaneous paper record of each vote. Because we conclude that most of the voters’ allegations involve generalized grievances about the lawfulness of government acts, and because their remaining claims fail on their merits, we reverse the court of appeals’ judgment and render judgment dismissing the case.

Conclusion. The voters raise legitimate concerns about system integrity and vulnerability. But these  are policy disputes more appropriately resolved in the give-and-take of politics. Perhaps the Secretary will  decide, as California has, to de-certify certain DREs. Perhaps the Legislature will require a contemporaneous paper record of votes cast, or perhaps Texas will curtail or abandon DRE use altogether.  But we cannot say the Secretary’s decision to certify this device violated the voters’ equal protection rights  or that the voters can pursue generalized grievances about the lawfulness of her acts. “Vindicating the  public interest (including the public interest in Government observance of the Constitution and laws) is the function of [the Legislature] and the Chief Executive.” Lujan, 504 U.S. at 576. We reverse the court of appeals’ judgment and render judgment dismissing the case. Tex. R. App. P. 60.2(c).


INTERLOCUTORY APPEAL IN MED-MAL CASES WHEN THE REPORT NEEDS FIXING:

Hold your fire! 

Tyler Scoresby, M.D. v. Santillan (Tex. 2011)

No. 09-0497(Tex. Jul. 1, 2011)(Opinion by Justice Don R. Willett)
(HCLC med-mal suits, expert report deadline extension, curing of defective reports, immmediate appealability of trial court's decision by interlocutory appeal)

The Medical Liability Act entitles a defendant to dismissal of a health care liability claim if, within 120 days of the date suit was filed, he is not served with an expert report showing that the claim against him has merit. The trial court’s refusal to dismiss is immediately appealable. The Act sets specific requirements for an  adequate report and mandates that “an objective good faith effort [be made] to comply” with them,5 but it also authorizes the trial court to give a plaintiff who meets the 120-day deadline an additional thirty days in which to cure a “deficiency” in the elements of the report. The trial court should err on the side of granting the additional time and must grant it if the deficiencies are curable. The defendant cannot seek review of this ruling or appeal the court’s concomitant refusal to dismiss the claim before the thirty-day period has expired.

Conclusion. We conclude that a thirty-day extension to cure deficiencies in an expert report may be granted if the report is served by the statutory deadline, if it contains the opinion of an individual with expertise that the claim has merit, and if the defendant’s conduct is implicated. We recognize that this is a minimal standard, but we think it is necessary if multiple interlocutory appeals are to be avoided, and appropriate to give a claimant the opportunity provided by the Act’s thirty-day extension to show that a claim has merit. All deficiencies, whether in the expert’s opinions or qualifications, are subject to being cured before an appeal may be taken from the trial court’s refusal to dismiss the case.
Justice Don R. Willett delivered a concurring opinion. [pdf]
Justice Phil Johnson delivered a dissenting opinion, in which Justice Dale Wainwright joined. [pdf]

KEEPING PUBLIC OFFICIAL'S DETAILS SECRET IN THE NAME OF SAFETY

Tx DPS v. Cox Texas Newspapers, L.P. (Tex. 2011)  

No. 09-0530 (Tex. Jul. 1, 2011)(access to records)

Our common law protects from public disclosure highly intimate or embarrassing facts. We must decide whether it also protects information that substantially threatens physical harm. We conclude that it does.  Both sides raise important questions, not just about safety but also about the public’s right to know how the
government spends taxpayer money. Those issues could not have been fully litigated under the standard that prevailed before today's decision. Accordingly, we reverse the court of appeals’ judgment and remand the case to the trial court for further proceedings.

Conclusion: We reverse the court of appeals’ judgment and remand the case to the trial court for further proceedings consistent with this opinion. Tex. R. App. P. 60.2 (d).
Justice Dale Wainwright delivered a concurring opinion, in which Justice Phil Johnson joined. [pdf]
(Justice David Medina and Justice Don R. Willett not sitting)


OPEN RECORD ACT aka PUBLIC INFORMATION ACT, henceforth a/k/a TPIA, not just PIA 

Jackson v. State Office of Administrative Hearings (Tex. 2011)

No. 10-0002 (Tex. Jul. 1, 2011)(Opinion by Justice Phil Johnson)(open records act request under PIA)

In order to withhold public information requested pursuant to the Texas Public Information Act (TPIA) a  governmental entity must demonstrate that the requested information is not within the scope of the TPIA or that it falls within one of TPIA’s specific exceptions to the disclosures requested. See Tex. Gov’t Code §§ 552.101-.148; City of Garland v. Dallas Morning News, 22 S.W.3d 351, 355-56 (Tex. 2000). In this case, the State Office of Administrative Hearings (SOAH) refused to disclose certain decisions and orders in license suspension cases related to delinquent child support. The trial court and court of appeals agreed with SOAH that the information is expressly excepted from disclosure by the Texas Government Code provisions.We hold that the decisions and orders must be disclosed after redaction of information expressly excepted from disclosure and not already in a public record or otherwise in the public domain. We reverse and remand to the trial court for further proceedings.

Conclusion. The decisions and orders Jackson requested must be disclosed. See Tex. Gov’t Code §552.002. The Legislature has clearly expressed its intent that exceptions to disclosure be construed narrowly. See Tex. Gov’t Code § 552.001; In re Georgetown, 53 S.W.3d at 340 (“‘When the Legislature has intended to make information confidential, it has not hesitated to so provide in express terms.’” (quoting
Birnbaum v. Alliance of Am. Insurers, 994 S.W.2d 766, 776 (Tex. App.—Austin 1999, pet. denied)); see also Cameron v. Terrell & Garrett, Inc., 618 S.W.2d 535, 540 (Tex. 1981) (“[E]very word of a statute must be presumed to have been used for a purpose. Likewise, we believe every word excluded from a statute must also be presumed to have been excluded for a purpose.”) (citations omitted). We decline to read the language of the statute broader than it is written and we conclude that the purpose and intent of the TPIA can be fulfilled by disclosing the requested documents with redactions. See City of Fort Worth v. Cornyn, 86 S.W.3d 320, 326 (Tex. App.—Austin 2002, no pet.) (“To find otherwise would also be inconsistent with the Legislature’s directive to liberally construe the Act in favor of disclosure.”). We therefore hold that SOAH must disclose the requested decisions and orders after redaction of any information obtained during provision of Chapter 231 services, such as information concerning a custodial parent, noncustodial parent, child, and an alleged or presumed father, that was not already in the public domain.


CATCHING SOMETHING ON THE BUS RATHER THAN JUST CATCHING THE BUS:

Just call the number on the back door
when the drivers spreads TB
Will insurer pay when the driver gets the passenger sick?

Lancer Ins. Co. v. Garcia Holiday Tours (Tex. 2011)

No. 10-0096 (Tex. Jul. 1, 2011)(Opinion by Justice David Medina) (insurance coverage, indemnity, liability
for communication of disease by bus driver to passenger)

The question in this appeal is whether the transmission of a communicable disease from the driver of a  motor vehicle to a passenger is a covered loss under a business auto policy, which affords coverage for accidental bodily injuries resulting from the vehicle’s use. The issue is one of first impression in this state and perhaps the country. The parties advise that they have found no similar reported cases.

The trial court concluded that the policy covered this type of occurrence and rendered summary judgment that the insurance carrier owed a duty to indemnify the insured. The court of appeals agreed that  the policy might provide coverage for such a claim but reversed the summary judgment and remanded the case to the trial court to resolve a factual dispute about whether the passengers had contracted the disease while in the vehicle. 308 S.W.3d 35, 47 (Tex. App.—San Antonio 2009). Because we conclude that communicable diseases are not an insured risk under this particular policy, we reverse the judgment below and render judgment for the insurance carrier.

Conclusion: We conclude that the transmission of a communicable disease from a bus driver to his passengers was not a risk assumed by the insurance carrier under this business auto policy because the
passengers’ injuries did not result from the vehicle’s use but rather from the bus company’s use of an unhealthy driver. The bus, itself, in its capacity as a mode of transportation, did not produce, and was not a substantial factor in producing, the passengers’ injuries. The court of appeals’ judgment is accordingly reversed and judgment rendered that the passengers, bus company, and driver take nothing on their indemnity claim against the insurance carrier.


ATTORNEY-CLIENT PRIVILEGE: Will the client's secrets leave with the firm-jumping paralegal?  


In Re Guaranty Ins. Services, Inc. (Tex. 2011)(per curiam)

No. 10-0364 (Tex. Jul. 1, 2011)(per curiam opinion) (mandamus granted to undo firm's disqualification from case) (practice of law, law firm support staff-based disqualification, conflicts of interest involving paralegal working for both sides in lawsuit)

What happens when a law firm’s efforts to screen a conflict fail, permitting a nonlawyer who worked on one side of a case at one firm to work on the other side of the same case at the opposing firm? Here, the trial
court disqualified the second firm, reasoning there was a conclusive presumption that the nonlawyer had  shared confidential information, despite evidence he had not. A divided court of appeals denied mandamus  relief. 310 S.W.3d 630, 634. Given our prior decisions on the subject—particularly our recent decision in In re Columbia Valley Healthcare System, L.P., 320 S.W.3d 819 (Tex. 2010) (orig. proceeding), issued our months after the court of appeals’ decision below—we conclude disqualification was not warranted. Further, because the improper disqualification was a clear abuse of discretion for which there is no adequate remedy by appeal, mandamus relief is warranted. See In re Prudential Ins. Co., 148 S.W.3d 124, 135–36 (Tex. 2004) (orig. proceeding) (describing when mandamus relief may issue); NCNB Tex. Nat’l Bank v. Coker, 765 S.W.2d 398, 400 (Tex. 1989) (orig. proceeding) (granting mandamus in context of improper disqualification). We conditionally grant mandamus relief and direct the trial court to vacate its disqualification order.For these reasons, and without hearing oral argument, see Tex. R. App. P. 52.8(c), we conditionally grant mandamus relief and direct the trial court to vacate its order granting the motion to disqualify. We are confident the trial court will comply, and the writ will issue only if it does not.

RARE BIRD: Petition for Writ of Mandamus denied with Opinion:

PARALLEL PROCEEDINGS: Plea for Abatement rather than Plea to the Jurisdiction should be used to enforce dominant jurisdiction when two cases are pending in different courts

In Re Puig (Tex. 2011)

No. 10-0460 (Tex. Jul. 1, 2011)(per curiam opinion) (mandamus denied)(dominant and vs. exclusive jurisdiction; proper procedural vehicle to sort it which court will proceed)

In this case, we are asked to grant mandamus relief to correct a district court’s denial of a plea to the jurisdiction. The plea challenged the district court’s jurisdiction to determine the ownership of a ranch  allegedly owned, in part, by an estate undergoing administration in a county court at law. Under our precedent, the issue here is one of dominant, not exclusive, jurisdiction. The proper method for contesting a court’s lack of dominant jurisdiction is the filing of a plea in abatement, not a plea to the jurisdiction as the relators filed here. See Wyatt v. Shaw Plumbing Co., 760 S.W.2d 245, 247–48 (Tex. 1988). Because the district court did not abuse its discretion in denying the relators’ plea to the jurisdiction, we deny the petition for writ of mandamus.

Conclusion: Because the issue is one of dominant, rather than exclusive, jurisdiction the relators should have filed a plea in abatement. The district court’s denial of the relators’ plea to the jurisdiction, therefore, did not constitute an abuse of discretion depriving the relators of an adequate appellate remedy. See Abor v. Black, 695 S.W.2d 564, 567 (Tex. 1985). We note that the improper denial of a plea in abatement may, on occasion, warrant mandamus relief. See, e.g., Curtis, 511 S.W.2d at 266–68. Pleas in abatement are incidental rulings, the denial of which ordinarily does not support mandamus relief. See Abor, 695 S.W.2d at 567.2 But when a court issues an “order which actively interferes with the exercise of jurisdiction” by a court possessing dominant jurisdiction, mandamus relief is appropriate. Id.; see Perry v. Del Rio, 66 S.W.3d 239, 258 (Tex. 2001) (granting mandamus relief to direct a district court to move a trial setting so that another court that already exercised jurisdiction over different cases involving nearly identical issues, parties, and witnesses could first consider those cases); Curtis, 511 S.W.2d at 266–68 (granting mandamus relief directing a judge to sustain a plea in abatement in a child custody suit where one court attempted to exercise jurisdiction with respect to the children, despite the fact that dominant jurisdiction had previously been established in another court). Because the Webb County district court did not commit a clear abuse ofdiscretion in denying the relators’ plea to the jurisdiction, any further inquiry into the relators’ appellate remedy is unnecessary. Accordingly, the relators’ petition for writ of mandamus is denied. 

ADDITIONAL LINKS FOR TEXAS SUPREME COURT DECISIONS:

No, the Texas Supreme Court no longer makes law in this venue.

2011 Texas Supreme Court Per Curiam Opinions  
2011 Texas Supreme Court Decisions issued January through June    

Contractual rights may be waived and thereby become unenforceable

WAIVER OF CONTRACT RIGHT


A party may waive a contractual right, and waiver can be asserted as an affirmative defense against a party seeking to enforce a contractual right after the party intentionally relinquished the right or engaged in conduct inconsistent with enforcement of the right. Tenneco Inc. v. Enter. Prods. Co., 925 S.W.2d 640, 643 (Tex. 1996).

SOURCE: Houston Court of Appeals - 01-10-00146-CV - 6/30/11

RELATED LEGAL TERMS: contract defenses, affirmative defenses to enforcement of contract, estoppel

Thursday, June 30, 2011

Defending a lawsuit on the basis of "res judicata"

RES JUDICATA DOCTRINE DEFINED

Res judicata precludes re-litigation of claims that have been finally adjudicated, or that arise out of the same subject matter and that could have been litigated in the prior action. Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996).

Res judicata is an affirmative defense. Tex. R. Civ. P. 94.

ELEMENTS OF RES JUDCIATA

The party asserting the defense must prove: (1) a prior final judgment on the merits by a court of competent jurisdiction; (2) identity of parties or those in privity with them; and (3) a second action based on the same claims as were raised or could have been raised in the first action. Amstadt, 919 S.W.2d at 652. We apply a transactional approach to res judicata. Barr v. Resolution Trust Corp., 837 S.W.2d 627, 631 (Tex. 1992). Under that approach, the subject matter of a suit is based on the factual matters that comprise the gist of the complaint. Id. at 630. Any claim that arises out of those facts should be litigated in the same action. Id.
SOURCE: Houston Court of Appeals - 14-10-00053-CV - 6/30/11


NATURE OF THE DEFENSE AND PROPER WAY TO ASSERT IT

The compulsory counterclaim rule and the doctrine of res judicata are affirmative defenses. Commint Technical Services, Inc. v. Quickel, 314 S.W.3d 646, 651 (Tex. App.—Houston [14th Dist.] 2010, no pet.). An affirmative defense, or “plea in bar,” operates to prohibit the assertion of a cause of action and involves the final disposition of a case. Tex. Underground, Inc. v. Texas Workforce Comm’n 335 S.W.3d 670, 675 (Tex. App.—Dallas 2011, no pet.) (citing Martin v. Dosohs I, Ltd., 2 S.W.3d 350, 354 (Tex. App.—San Antonio 1999, pet. denied); In re A.M., 936 S.W.2d 59, 62 (Tex. App.—San Antonio 1996, no writ)).

An affirmative defense is not typically disposed of in a preliminary hearing, such as a motion to dismiss. Tex. Underground, 335 S.W.3d at 675 (citing Martin, 2 S.W.3d at 354). Rather, an affirmative defense should be raised through a motion for summary judgment or proven at trial. Id. at 676; In re D.K.M., 242 S.W.3d 863, 865 (Tex. App.—Austin 2007, no pet.); see Montgomery Cnty. v. Fuqua, 22 S.W.3d 662, 669 (Tex. App.—Beaumont 2000, pet. denied) (“Affirmative defenses are ‘pleas in bar,’ and do not provide a justification for summary dismissal on the pleadings.”).


SOURCE: Houston Court of Appeals - 01-10-00476-CV - 6/30/11
 
SUMMARY JUDGMENT BASED ON AFFIRMATIVE DEFENSE SUCH AS RES JUDICATA

We review the trial court’s grant of summary judgment de novo. Joe v. Two Thirty Nine Joint Venture, 145 S.W.3d 150, 156–57 (Tex. 2004). A movant must establish its right to summary judgment by showing that no genuine issue of material fact exists and that it is entitled to judgment as a matter of law. Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548 (Tex. 1985). We take as true all evidence favorable to the non-movant, and we indulge every reasonable inference and resolve any doubts in the non-movant’s favor. Joe, 145 S.W.3d at 157. We review a summary judgment for evidence that would enable reasonable and fair-minded jurors to differ in their conclusions. Wal-Mart Stores, Inc. v. Spates, 186 S.W.3d 566, 568 (Tex. 2006) (per curiam). A defendant is entitled to summary judgment on an affirmative defense if the defendant conclusively proves all the elements of the affirmative defense. Frost Nat’l Bank v. Fernandez, 315 S.W.3d 494, 508–09 (Tex. 2010), cert. denied, 131 S.Ct. 1017 (2011); see Tex. R. Civ. P. 166a(b), (c).

SOURCE: Houston Court of Appeals - 14-10-00053-CV - 6/30/11

RELATED LEGAL DEFENSES, TERMS: collateral estoppel, claim and issue preclusion

The Economic Loss Rule

SIGNIFICANCE OF THE ECONOMIC LOSS RULE

Texas Supreme Court cite on economic loss rule:

The economic-loss rule generally precludes recovery in tort for economic losses resulting from the failure of a party to perform under a contract. Lamar Homes, Inc. v. Mid-Continent Cas. Co., 242 S.W.3d 1, 12 (Tex. 2007).

When the only loss or damage is to the subject matter of the contract, the plaintiff’s action is ordinarily on the contract. Sw. Bell Tel. Co. v. DeLanney, 809 S.W.2d 493, 494 (Tex. 1991).

SOURCE: Houston Court of Appeals - 14-10-00351-CV - 6/30/11


RELATED LEGAL CONCEPTS: breach of contract vs. tort, contractual obligations vs. obligations imposed by law, contract and non-contract causes of action

Wednesday, June 29, 2011

TCHRA: Age discrimination claims under state anti-discrimination statute (Chapter 21 Tex. Labor Code)

AGE DISCRIMINATION CLAIMS UNDER TEXAS LAW (Labor Code Chapter 21 claim)

Texas statute provides remedy against discriminatory employment practices like Tile VII; courts follow federal precedent in interpreting the Texas Commission on Human Rights Act [TCHRA]

Under the THCRA:
An employer commits an unlawful employment practice if because of race, color, disability, religion, sex, national origin, or age the employer:
(1) fails or refuses to hire an individual, discharges an individual, or discriminates in any other manner against an individual in connection with compensation or the terms, conditions, or privileges of employment; or
(2) limits, segregates, or classifies an employee or applicant for employment in a manner that would deprive or tend to deprive an individual of any employment opportunity or adversely affect in any other manner the status of an employee.
TEX. LAB. CODE ANN. § 21.051 (West 2006).

The TCHRA also provides:
(a) Except as otherwise provided by this chapter, an unlawful employment practice is established when the complainant demonstrates that race, color, sex, national origin, religion, age, or disability was a motivating factor for an employment practice, even if other factors also motivated the practice, unless race, color, sex, national origin, religion, age, or disability is combined with objective job-related factors to attain diversity in the employer’s work force.
(b) In a complaint in which a complainant proves a violation under Subsection (a) and a respondent demonstrates that the respondent would have taken the same action in the absence of the impermissible motivating factor, the court may grant declaratory relief, injunctive relief except as otherwise provided by this subsection, and attorney’s fees and costs demonstrated to be directly attributable only to the pursuit of a complaint under Subsection (a), but may not award damages or issue an order requiring an admission, reinstatement, hiring, promotion, or back pay.
Id. § 21.125. Because the TCHRA’s stated purpose is to “provide for the execution of the policies of Title VII of the Civil Rights Act of 1964 and its subsequent amendments,” Texas courts apply analogous federal case law when interpreting the Texas statute. Id. § 21.001(1); Quantum Chem. Corp. v. Toennies, 47 S.W.3d 473, 476 (Tex. 2001).

SOURCE: San Antonio Court of Appeals - 04-10-00730-CV - 6/22/11

OTHER RELEVANT CASE LAW EXCERPTS ON TCHRA EMPLOYMENT DISCRIMINATION CLAIMS

Texas law requires that a complaint of unlawful employment discrimination be filed with the Texas Commission on Human Rights within 180 days after the alleged unlawful employment action occurs. Cooper-Day v. RME Petroleum Co., 121 S.W.3d 78, 83 (Tex.App.-Fort Worth 2003, pet. denied), citing Specialty Retailers, Inc. v. DeMoranville, 933 S.W.2d 490, 492 (Tex. 1996); see Tex.Lab.Code Ann. § 21.202(a)(Vernon 2006). This limitations period is mandatory and jurisdictional. Schroeder v. Texas Iron Works, Inc., 813 S.W.2d 483, 486 (Tex. 1991). That is, failure to timely file an administrative complaint deprives Texas trial courts of subject matter jurisdiction over a subsequent claim against the employer. See Cooper-Day, 121 S.W.3d at 83.


The Texas Commission on Human Rights Act (the "TCHRA," codified in Chapter 21 of the Texas Labor Code) makes it unlawful for an employer to discriminate against an employee with respect to compensation or the terms, conditions, or privileges of employment because of race, color, disability, religion, sex, or national origin. TEX. LAB.CODE ANN. § 21.051 (Vernon 2006). Before filing suit, a plaintiff must file a complaint with the TWC or EEOC and receive a notice of right to sue on the claims alleged. See id. §§ 21.201-202. Once that notice of right to sue is received, the plaintiff must then file suit within 60 days. Id. § 21.254. Texas courts have interpreted section 21.254 to mean that a plaintiff must file the suit and serve notice of the suit upon the proper parties within 60 days of receiving of notice of a right to sue from the TWC. See, e.g., Tarrant County v. Vandigriff, 71 S.W.3d 921, 924 (Tex.App.-Fort Worth 2002, pet. denied) ("The mere filing of a lawsuit is not sufficient to meet the requirements of `bringing suit' within the limitations period [of Chapter 21]; rather, a plaintiff must both file her action and have the defendant served with process.") (emphasis in original); Davis v. Educ. Serv. Ctr., 62 S.W.3d 890, 893 n. 4 (Tex. App.-Texarkana 2001, no pet.); Roberts v. Padre Island Brewing Co., 28 S.W.3d 618, 621 (Tex.App.-Corpus Christi 2000, pet. denied);

The limitations period begins when the employee is informed of the allegedly discriminatory employment decision. Tex.Lab.Code Ann. § 21.202(a); see Delaware State College v. Ricks, 449 U.S. 250, 258, 101 S.Ct. 498, 504, 66 L.Ed.2d 431 (1980); Specialty Retailers, 933 S.W.2d at 493. The date the allegedly discriminatory decision goes into effect, or the date on which the effect of such decision is realized by the employee, does not alter the commencement of the 180-day period. See Villareal v. Williams, 971 S.W.2d 622, 625 (Tex.App.-San Antonio 1998, no pet.), citing Johnson & Johnson Med., Inc. v. Sanchez, 924 S.W.2d 925, 928-29 (Tex. 1996)(Applying the Worker's Compensation Act); Specialty Retailers, 933 S.W.2d at 492-93 (Applying the TCHR); Cooper-Day, 121 S.W.3d at 83, 85. As the United States Supreme Court explained in its interpretation of the equivalent provision in Title VII, "`the proper focus is upon the time of the discriminatory acts, not upon the time at which the consequences of the acts became most painful.'" Ricks, 449 U.S. at 258, 101 S.Ct. at 504.
"The [Texas Commission on Human Rights Act (CHRA)] . . . establishes a `comprehensive administrative review system,' under which the `exhaustion of administrative remedies is a mandatory prerequisite to filing a civil action alleging violations of the CHRA.'" Hoffmann-La Roche, Inc. v. Zeltwanger, 144 S.W.3d 438, 446 (Tex. 2004) (quoting Schroeder v. Tex. Iron Works, Inc., 813 S.W.2d 483, 485, 488 (Tex. 1991)). To comply with the exhaustion requirement, an employee must (1) file a complaint with the EEOC within 180 days of the alleged discriminatory act and (2) allow the EEOC to dismiss the complaint or resolve the complaint within 180 days before filing suit. Rice v. Russell-Stanley, L.P., 131 S.W.3d 510, 513 (Tex. App. Waco 2004, pet. denied); see Tex. Lab. Code Ann. §§ 21.201-.202, 21.208 (Vernon 2006); see also Gallegos v. Johnson, No. 13-07-00603-CV, 2010 Tex. App. LEXIS 1330, at **37-38 (Tex. App.-Corpus Christi Feb. 25, 2010, no pet. h.) (mem. op.). A plaintiff's entitlement to a right-to-sue letter signals that she has satisfied the exhaustion requirement. See Rice, 131 S.W.3d at 512 (holding that "it is the entitlement to the right-to-sue letter that exhausts the complainant's administrative remedies," not its possession); City of Houston v. Fletcher, 63 S.W.3d 920, 923 (Tex. App.-Houston [14th Dist.] 2002, no pet.) (explaining that "[t]he statute certainly supports an interpretation that the right-to-sue letter is notice of exhaustion, not actually part of exhaustion"); see also Gallegos, 2010 Tex. App. LEXIS 1330, at *38. Additionally, the suit must be filed no later than two years after the original complaint is filed. See Tex. Lab. Code Ann. § 21.256 (Vernon 2006); Rice, 131 S.W.3d at 513; see also Gallegos, 2010 Tex. App. LEXIS 1330, at **37-38.

Defamation damages: Putting a dollar value on impairment of good name and reputation as a result of libel or slander



PROVING DEFAMATION DAMAGES IN AN ACTION FOR LIBEL OR SLANDER 

General vs. specific damages 

Compensatory damages allowable for defamation are divided into two categories: general and special. Peshak v. Greer, 13 S.W.3d 421, 427 (Tex.App.-Corpus Christi 2000, no pet.).    


General damages include mental anguish, loss of reputation, and like damages that naturally flow from the defamation and are not easily susceptible to monetary valuation.  Id.  General damages are those conclusively presumed to have been foreseen by the defamer as a necessary and usual result of his or her wrongful act.  Fox v. Parker, 98 S.W.3d 713, 726 (Tex.App.--Waco 2003, pet. denied) (citing Arthur Anderson & Co. v. Parker Equip. Co., 945 S.W.2d 812, 816 (Tex. 1997)).

Defamation Per Se damages

"The law presumes a statement which is libelous per se defames a person, injures his reputation"; id., and causes mental anguish.  Ryder Truck Rentals, Inc. v. Latham, 593 S.W.2d 334, 337 (Tex.Civ.App.--El Paso 1979, writ ref'd n.r.e.) (general damages for injury to character, reputation, feelings, mental suffering or anguish, or other wrongs not susceptible to monetary valuation are presumed); Peshak, 13 S.W.3d at 427 ("In actions of libel per se, the law presumes the existence of some actual damages, requiring no independent proof of general damages.")  Because the damages are presumed, "there need be no inquiry in the [jury] charge about whether there was a defamation or about 'proximate cause' and injury (or the jury may be instructed to so find.”)  Fox, 98 S.W.3d at 726.      
            
Further, because the damages are purely personal and cannot be measured by any fixed rule or standard, the amount of general damages suffered in a defamation case is difficult to determine.  First State Bank of Corpus Christi v. Ake, 606 S.W.2d 696, 702 (Tex.Civ.App.--Corpus Christi 1980, writ ref'd n.r.e.) (citing Bayoud v. Sigler, 555 S.W.2d 913 (Tex.Civ.App.--Beaumont 1977, writ dis'md)).  Thus, because of their uncertain nature, their measurement is generally left to the discretion of the finder of fact, subject only to a determination that the award was clearly excessive or the result of "passion, prejudice, or other improper influences."  See Morrill, 226 S.W.3d at 550 (citing Bolling, 671 S.W.2d at 549).  See also Tranum v. Broadway, 283 S.W.3d 403, 422 (Tex.App.--Waco 2008, pet. denied). 

SOURCE: Amarillo Court of Appeals - 07-09-00277-CV - 6/16/11

EXCERPTS FROM CITED CASE: Peshak v. Greer, 13 S.W.3d 421 (Tex.App.-Corpus Christi 2000, no pet.)


In both libel and slander the issues are whether the utterance was made, if it was false, if it damaged the complainant and if the speaker had any privilege. RESTATEMENT (SECOND) OF TORTS § 558 (1977); c.f.Shearson Lehman Hutton, Inc. v. Tucker, 806 S.W.2d 914, 921 (Tex.App.-Corpus Christi 1991, writ dism'd w.o.j.). Whether the defendant intended to say or print the defamatory words is not an element of the cause of action unless privilege is involved. See Express Pub. Co. v. Lancaster, 2 S.W.2d 833, 834 (Tex.Comm.App. 1928) (holding defamation defendant is liable irrespective of his innocent motives in publishing the defamatory statement); Hornby v. Hunter, 385 S.W.2d 473, 476 (Tex.Civ.App.-Corpus Christi 1964, no writ) (holding that even innocent, mistaken publication still subjects defamer to liability); 50 Tex. Jur. 3d Libel & Slander, § 12, at 33 (1986) (noting that intent is not an element of defamation). We assume the words were intended because they were used. When the jury found Peshak defamed Greer and what he said was false, it found by inference that he intended to write the letters found to be defamatory.


The issue is whether exemplary damages may be awarded if the defamatory statement is made intentionally or willfully. Punitive damages are available in defamation cases based upon the same rules governing punitive damage awards for all torts. Nabours v. Longview Sav. & Loan Ass'n., 700 S.W.2d 901, 903 n. 1 (Tex.1985). The supreme court has held that a plaintiff must prove the statements were made maliciously to justify exemplary damages in a defamation case. See Leyendecker & Assocs., Inc. v. Wechter, 683 S.W.2d 369, 375 (Tex. 1984). Civil Practice and Remedies Code section 41.003 provides that exemplary damages may only be awarded if the claimant proves by clear and convincing evidence that the harm resulted from fraud or malice. See TEX. CIV. PRAC. & REM.CODE ANN. § 41.003(a) (Vernon 1997).[1]


We hold that exemplary damages in a defamation case between private litigants that does not involve privilege can only be supported if the utterance was made with malice. That the statements were made willfully or intentionally will not justify exemplary damages.


This case does not involve a media defendant. The rule of Gertz v. Robert Welch, Inc., 418 U.S. 323, 347, 94 S.Ct. 2997, 41 L.Ed.2d 789 (1974), requiring fault in a defamation action against a publisher or broadcaster for a defamatory statement about a private individual, is not applicable. See WFAA-TV, Inc. v. McLemore, 978 S.W.2d 568, 571 (Tex. 1998).


Compensatory damages allowable for defamation are divided into two categories: general and special. General damages are mental anguish, injury to the reputation and the like that naturally flow from the libel and are not easily susceptible to monetary valuation. West Texas Utilities Co. v. Wills, 164 S.W.2d 405, 412 (Tex.Civ.App.-Austin 1942, no writ); Evans v. McKay, 212 S.W. 680, 685 (Tex.Civ. App.-Dallas 1919, writ dism'd); see also Leyendecker, 683 S.W.2d at 374.


In actions of libel per se, the law presumes the existence of some actual damages, requiring no independent proof of general damages. See Shearson Lehman Hutton, Inc. v. Tucker, 806 S.W.2d 914, 922 (Tex.App.-Corpus Christi 1991, writ dism'd w.o.j.); Adolph Coors Co. v. Rodriguez, 780 S.W.2d 477, 488 (Tex. App.-Corpus Christi 1989, writ denied); City of Brownsville v. Pena, 716 S.W.2d 677, 682 (Tex.App.-Corpus Christi 1986, no writ); First State Bank v. Ake, 606 S.W.2d 696, 702 (Tex.Civ.App.-Corpus Christi 1980, writ ref'd n.r.e.). The amount of general damages is very difficult to determine, and the jury is given wide discretion in its estimation of them. Evans, 212 S.W. at 685; Wills, 164 S.W.2d at 412.


LOST EARNINGS CAPACITY 


Lost earning capacity is a form of special damages, Missouri Pac. Ry. Co. v. Richmond, 73 Tex. 568, 11 S.W. 555, 558 (1889); Houston Belt & Terminal Ry. Co. v. Wherry, 548 S.W.2d at 743, 753 (Tex. Civ.App.-Houston [1st Dist.] 1976, writ ref'd n.r.e.), and must be specifically stated and proved. Kelly v. Diocese of Corpus Christi, 832 S.W.2d 88, 91 (Tex.App.-Corpus Christi 1992, writ dism'd w.o.j.); Vista Chevrolet, Inc. v. Barron, 698 S.W.2d 435, 441 (Tex.App.-Corpus Christi 1985, no writ). Although the amount of damages for lost earning capacity is largely within the discretion of the jury, Fowler v. Pedlar, 497 S.W.2d 399, 401 (Tex.Civ.App.-Houston [1st Dist.] 1973, no writ), the plaintiff is required to prove his lost earning capacity "with that degree of certainty to which the case is susceptible...." McIver v. Gloria, 140 Tex. 566, 169 S.W.2d 710, 712 (1943).


RELATED LEGAL TERMS: defamation, libel, slander, reputational damage, damage to good name, reputation, business goodwill, standing in the community, mental, psychological, emotional distress, embarrassment

Tuesday, June 28, 2011

Official Immunity Defense [affirmative defense invoked by governmental defendants]

OFFICIAL IMMUNITY OF PUBLIC OFFICIALS, OFFERS, GOVERNMENT EMPLOYEES

The affirmative defense of official immunity "is based on necessity of public officials to act in the public interest with confidence and without the hesitation that could arise from having their judgment continually questioned by extended litigation." Ballantyne v. Champion Builders, Inc., 144 S.W.3d 417, 424 (Tex. 2004). The underlying policy is that officials should be afforded some leeway to err because "the risk of some error is preferable to intimidation from action at all." Id. at 424 (citing Wood v. Strickland, 420 U.S. 308, 319-21 (1975)). To that end, official immunity shields officials "from being forced to defend their decisions that were reasonable when made, but upon which hindsight has cast a negative light." Telthorster v. Tennell, 92 S.W.3d 457, 461 (Tex. 2002). "Police officers' particular need for [official] immunity is well recognized: 'nowhere else in public service is official immunity more appropriate or necessary than in police work. In their routine work, police officers must be free to make split-second judgments . . . based on their experience and training, without fear of personal liability.'" Id. (quoting Travis v. City of Mesquite, 830 S.W.2d 94, 103 (Tex. 1992) (Cornyn, J., concurring)).

Elements of Official Immunity Defense: What does the Defendant have to establish?

An officer's actions are shielded by official immunity when the following elements are proven: (1) the officer was performing a "discretionary" function or duty, (2) within the scope of his authority, (3) in "good faith." Ballantyne, 144 S.W.3d at 422; Telthorster, 92 S.W.3d at 461; Chambers, 883 S.W.2d at 653. Consequently, to prevail on summary judgment based on Garner's official immunity from liability arising from his collision with Albarran, the City had the burden to conclusively establish that, with respect to Garner's actions from which his liability would arise: (1) Garner was performing a "discretionary" function, (2) within the scope of his authority, (3) in "good faith." See Telthorster, 92 S.W.3d at 461.

What is considered discretionary? 

"Discretionary" functions involve "personal deliberation, decision, and judgment," in contrast to "ministerial" acts, which "require obedience to orders or the performance of a duty to which the actor has no choice." Chambers, 883 S.W.2d at 654; see Commissioner of the Gen. Land Office v. Smith, 5 Tex. 471, 479 (1849) ("where the act to be done involves the exercise of discretion or judgment in determining whether the duty exists, it is not to be deemed merely ministerial").

An act is also said to be ministerial if "the law prescribes and defines the duty to be performed with such precision and certainty as to leave nothing to the exercise of discretion or judgment." Chambers, 883 S.W.2d at 654 (quoting Rains v. Simpson, 50 Tex. 495, 501 (1878)). In determining whether a government employee's action is "discretionary" versus "ministerial," the proper focus is "on whether the officer is performing a discretionary function, not on whether the officer has discretion to do an allegedly wrongful act while discharging that function." Id. at 653 (emphases added).

Texas courts have recognized that a police officer's operation of a motor vehicle may be deemed a discretionary function in certain situations. These situations include an officer's deciding to undertake and conducting of a high-speed pursuit of a suspect, see Chambers, 883 S.W.2d at 655, and an officer's decision to violate traffic laws in order to quickly reach a scene of suspected criminal activity and assist another officer there, see Harless v. Niles, 100 S.W.3d 390, 398 (Tex. App.--San Antonio 2002, no pet.). See also City of San Angelo Fire Dep't v. Hudson, 179 S.W.3d 695, 704 (Tex. App.--Austin 2005, no pet.) (manner of firefighters' driving in response to emergency call was discretionary function as matter of law); City of Houston v. Flaniken, 108 S.W.3d 555, 557 (Tex. App.--Houston [14th Dist.] 2003, no pet.) (manner of operating ambulance in response to emergency situation was discretionary function as matter of law). Although these decisions sometimes speak in apparent circularities--e.g., a police officer performs a "discretionary" function when responding to an "emergency" because responding to an "emergency" entails discretion and judgment--their underlying principle seems to be that when a police officer is performing certain law enforcement functions involving discretion and judgment (e.g, pursuit and detention of suspects), it follows that this discretion and judgment can extend to whether and how the officer utilizes a motor vehicle in performing these functions. See Chambers, 883 S.W.2d at 654; Harless, 100 S.W.3d at 397-98; see also Hudson, 179 S.W.3d at 704; Flaniken, 108 S.W.3d at 557.

In Chambers, for example, an officer's high-speed pursuit of a suspect who ran a red light was held to be a discretionary function because the officer had to elect whether to undertake pursuit, and "[b]eyond the initial decision to engage in the chase, a high speed pursuit involves the officer's discretion on a number of levels, including, which route should be followed, at what speed, should back-up be called for, and how closely should the fleeing vehicle be pursued." 883 S.W.2d at 655. In Harless, officers proceeding to the scene of "suspicious activity" to assist a fellow officer similarly had discretion to determine, in the first instance, whether to respond to a report of ongoing criminal activity. 100 S.W.3d at 398. These circumstances required officers to respond using personal deliberation or exercise professional expertise, decision, or judgment. See id. at 397.

SOURCE: Austin Court of Appeals 03-10-00328-CV - 6/23/11

At-will employment & claims of fraud, fraudulent inducement, and breach of fiduciary duty

NO DETRIMENTAL RELIANCE ON PROMISE OF FUTURE EMPLOYMENT IN THE EMPLOYMENT-AT-WILL CONTEXT Both common-law fraud and fraudulent inducement require proof of detrimental reliance. See Schlumberger Tech. Corp. v. Swanson, 959 S.W.2d 171, 179 (Tex. 1997). In the employment context, courts have held that an employee cannot establish justifiable reliance on alleged promises of continued employment when the employment is at-will. See, e.g., Miller v. Raytheon Aircraft Co., 229 S.W.3d 358, 379, 381 (Tex. App.—Houston [1st Dist.] 2007, no pet.) (holding promissory estoppel and fraud claims were barred because of at-will employment); Brown v. Swett & Crawford of Tex., Inc., 178 S.W.3d 373, 379-80 (Tex. App.—Houston [1st Dist.] 2005, no pet.) (holding status as at-will employee precluded claim for fraudulent inducement in wrongful termination lawsuit). As this court [14th CoA] stated in Collins v. Allied Pharmacy Management, Inc.: A promise to provide employment which is subject to termination at any time or for any reason does not provide any assurances about the employer’s future conduct, and does not provide a basis for detrimental reliance as a matter of law. 871 S.W.2d 929, 937 (Tex. App.—Houston [14th Dist.] 1994, no writ). We agree with the trial court that the same reasoning bars [ FORMER EMPLOYER-PLAINTIFF ] from claiming that it justifiably relied on promises or statements of intent by its at-will employee to remain employed. See Collins, 871 S.W.2d at 937-38 (“An employee may quit at any time, or may never start performance and suffer no liability. . . . [E]mployees are not indentured servants.”). BREACH OF FIDUCIARY DUTY The elements of a breach of fiduciary duty claim are (1) a fiduciary relationship between the plaintiff and defendant, (2) a breach by the defendant of his fiduciary duty to the plaintiff, and (3) an injury to the plaintiff or benefit to the defendant as a result of the defendant’s breach. Lundy v. Masson, 260 S.W.3d 482, 501 (Tex. App.—Houston [14th Dist.] 2008, pet. denied). DETRIMENTAL RELIANCE NOT AN ELEMENT OF BoFD Unlike a fraud claim, a claim for breach of fiduciary duty does not require a plaintiff to establish reliance. See id. (listing elements of the claims). Consequently, the fact that at-will employment precludes [ PLAINTIFF ] from establishing justifiable reliance for purposes of its fraud claim on alleged statements by [ EMPLOYEE ] regarding future employment with [ DEFENDANT ] does not bar its breach of fiduciary duty claim. See Wilson, 305 S.W.3d at 74-75 (although similarity existed “in the abstract” between the elements of the two claims, claims had different elements and thus exception did not apply); see also Lundy, 260 S.W.3d at 506-07 (fraud and breach of fiduciary duty claims, although based on the same set of facts, were separate theories of liability for which plaintiff had to make an election of remedies). SOURCE: Houston Court of Appeals - 14-10-00513-CV - 6/28/11

Civil Conspiracy: What amounts to actionable civil conspiracy under Texas law?

CIVIL CONSPIRACY LEGALLY DEFINED

A civil conspiracy consists of a combination by two or more persons to accomplish an unlawful purpose or a lawful purpose by unlawful means. Firestone Steel Prods. Co. v. Barajas, 927 S.W.2d 608, 614 (Tex. 1996).

ELEMENTS OF CIVIL CONSPIRACY CAUSE OF ACTION
The elements of civil conspiracy are (1) two or more persons; (2) an object to be accomplished; (3) a meeting of minds on the object or course of action; (4) one or more unlawful, overt acts; and (5) damages as the proximate result. Tri v. J.T.T., 162 S.W.3d 552, 556 (Tex. 2005); Boales v. Brighton Builders, Inc., 29 S.W.3d 159, 164 (Tex. App.—Houston [14th Dist.] 2000, pet. denied).

SOURCE: Houston Court of Appeals - 14-10-00513-CV - 6/28/11

Monday, June 27, 2011

Negligent Activity and Premises Defect Claim: Is there a difference?

CAUSE OF ACTION FOR NEGLIGENT ACTIVITY ON PREMISES The Texas Supreme Court has consistently recognized that negligent-activity claims and premises-defect claims involve two independent “theories” of recovery that fall within the scope of negligence. See Gen. Elec. Co. v. Moritz, 257 S.W.3d 211, 214–15 (Tex. 2008) (distinguishing between “negligent-activity claim” or “theory” and “premises-condition claim” or “theory”); Clayton W. Williams, Jr., Inc. v. Olivo, 952 S.W.2d 523, 527 (Tex. 1997) (stating that there are “two types of negligence in failing to keep the premises safe: that arising from an activity on the premises, and that arising from a premises defect”); see also Mayer v. Willowbrook Plaza Ltd. Partnership, 278 S.W.3d 901, 909 (Tex. App.—Houston [14th Dist.] 2009, no pet.) (stating that “[n]egligent activity and premises defect are independent theories of recovery”). Negligent activity claims and premises liabiltiy claims distinguished: Commission vs. omission Although “[t]he lines between negligent activity and premises liability are sometimes unclear,” the court has continued to recognize the distinction between these two claims, explaining that “negligent activity encompasses a malfeasance theory based on affirmative, contemporaneous conduct by the owner that caused the injury, while premises liability encompasses a nonfeasance theory based on the owner’s failure to take measures to make the property safe.” Del Lago Partners, Inc. v. Smith, 307 S.W.3d 762, 776 (Tex. 2010). Activity as opposed to condition as cause of injury Recovery on a negligent-activity claim requires that the plaintiff have been injured by or as a contemporaneous result of the “activity itself” rather than by a “condition” created by the activity. Olivo, 952 S.W.2d at 527; Keetch v. Kroger Co., 845 S.W.2d 262, 264 (Tex. 1992). Although an owner or occupier generally does not owe a duty to ensure that an independent contractor performs its work in a safe manner, an owner or occupier “who retains a right to control the contractor’s work may be held liable for negligence in exercising that right” under the negligent-activity theory. Moritz, 257 S.W.3d at 214 (emphasis added). SOURCE: Houston Court of Appeals - 01-09-01089-CV - 6/23/11

Liability for Premises Defects & Independent Contractors

CATEGORIES OF PREMISES-DEFECT CLAIMS UNDER TEXAS LAW There are two types of premises defects for which an independent contractor’s employee may seek to hold a premises owner or general contractor liable. Clayton W. Williams, Jr., Inc. v. Olivo, 952 S.W.2d 523, 527 (Tex. 1997). Existing dangerous conditions on premises not created by the contractor The first category includes those defects that exist on a premises when a business invitee enters for business purposes or are created through some means unrelated to the activity of the injured employee or his employer. Id.; Shell Chem. Co. v. Lamb, 493 S.W.2d 742, 746 (Tex. 1973). When dangerous conditions do not arise through the independent contractor’s work activity, the owner or general contractor has a duty to inspect the premises and warn about the dangerous conditions of which the owner or general contractor knows or should know. Moritz, 257 S.W.3d at 214–15; Olivo, 952 S.W.2d at 527. An independent contractor is “under no duty to inspect the premises forconcealed dangers” because independent contractors may “anticipate” that the owner or general contractor “will discharge [its] duty to inspect the premises and warn of any dangerous condition which is not open and obvious.” Lamb, 493 S.W.2d at 746 (emphasis added); see also Moritz, 257 S.W.3d at 215 (stating that “[g]enerally, a landowner is liable to employees of an independent contractor only for claims arising from a pre-existing defect rather than from the contractor’s work, and then only if the pre-existing defect was concealed”). The rationale for this duty is that the owner or general contractor is in a “superior position to know of or discover hidden dangerous conditions on his premises.”[5] Lamb, 493 S.W.2d at 746 (emphasis added). [5] When a hidden, dangerous condition exists on a premises at the time an independent contractor enters, or when it “exists through some means other than the [independent contractor’s] work activity on the premises,” the owner’s or general contractor’s duty to an independent contractor and its employees “may be discharged by an adequate warning to the [independent contractor] or one supervising his work.” Shell Chem. Co. v. Lamb, 493 S.W.2d 742, 747 (Tex. 1973). Independent contractors' work actitivity as cause of injury The second category of premises defects includes those defects an independent contractor, or its injured employee, create by its work activity. Dow Chem. Co. v. Bright, 89 S.W.3d 602, 606 (Tex. 2002); Olivo, 952 S.W.2d at 527. When the independent contractor creates a dangerous condition, the owner or general contractor ordinarily has no duty to warn the independent contractor’s employees of the premises defect. Olivo, 952 S.W.2d at 527. The rationale for this rule is that an owner or general contractor normally has no duty to ensure that an independent contractor performs its work in a safe manner. Id. In explaining why, under the first category, the duty owed by a premises owner or general contractor to an independent contractor is limited to concealed hazards, the Texas Supreme Court has recently explained that because an independent contractor “owes its own employees a nondelegable duty to provide them a safe place to work, safe equipment to work with, and warn them of potential hazards,” a premises owner that “hires an independent contractor generally expects the contractor to take into account any open and obvious premises defects in deciding how the work should be done, what equipment to use in doing it, and whether its workers need any warnings.” Moritz, 257 S.W.3d at 216–17. The court reasoned that “[p]lacing the duty on an independent contractor to warn its own employees or make safe open and obvious defects ensures that the party with the duty is the one with the ability to carry it out.” Id. (emphasis added). In Moritz, an independent contractor, on a daily basis, loaded trailers with supplies from a General Electric warehouse. Id. at 213–14. Moritz, the independent contractor, sustained personal injuries in the course of securing the supplies after a rubber bungee cord that he was using broke and he fell off the side of a loading ramp. Id. Based upon the absence of handrails on the loading ramp, Moritz brought a premises-defect claim against GE. Id. at 215. The court, noting that the absence of handrails was “obviously a pre-existing condition and obviously not a concealed hazard,” concluded that GE had “no duty to warn Moritz that a ramp [that] he had been using for more than a year had no handrails.” Id. at 216. Although the court acknowledged that GE, as the premises owner, “had a duty to exercise care with respect to matters over which it exercised control,” it reasoned that Moritz’s premises-defect claim failed because GE “did not control where or how Moritz chose to secure his load.” Id. at 217. The court noted that “independent contractors are hired for special projects that often entail special expertise, and can be expected to use whatever equipment or precautions are necessary so long as a hazard is not concealed.” Id. (emphasis added). SOURCE: Houston Court of Appeals - 01-09-01089-CV - 6/23/11

Saturday, June 25, 2011

TCHRA: Types of Discrimination Claims under Texas anti-discrimination act (employment)

TCHRA CLAIM [discrimination in employment under state law] [TCHRA=TEXAS COMMISSION ON HUMAN RIGHTS ACT] Because the TCHRA’s stated purpose is to “provide for the execution of the policies of Title VII of the Civil Rights Act of 1964 and its subsequent amendments,” Texas courts apply analogous federal case law when interpreting the Texas statute. Id. § 21.001(1); Quantum Chem. Corp. v. Toennies, 47 S.W.3d 473, 476 (Tex. 2001). There are two types of Title VII employment discrimination cases. Quantum Chem., 47 S.W.3d at 476. The first is the “pretext” case, in which the plaintiff claims the employer’s stated reason for the adverse action was a pretext for discrimination. Tex. Dep’t of Cmty. Affairs v. Burdine, 450 U.S. 248, 252–53 (1981); McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802–04 (1973). In a pretext case, federal and Texas courts traditionally follow the McDonnell Douglas-Burdine framework for allocation of proof. E.g., Shackelford v. Deloitte & Touche, LLP, 190 F.3d 398, 404 n.2 (5th Cir. 1999); Quantum Chem., 47 S.W.3d at 479–80; Claymex Brick & Tile, Inc. v. Garza, 216 S.W.3d 33, 35 (Tex. App.—San Antonio 2006, no pet.). Under the McDonnell Douglas-Burdine framework, the plaintiff-employee has the burden of producing evidence that raises an inference of discrimination. Russo v. Smith Int’l, Inc., 93 S.W.3d 428, 435 (Tex. App.—Houston [14th Dist.] 2002, pet. denied). The plaintiff’s burden at this stage “is not onerous.” Quantum Chem., 47 S.W.3d at 477 (quoting Burdine, 450 U.S. at 253). A prima facie case of age discrimination requires proof that the plaintiff (1) is at least forty years of age; (2) was discharged; (3) was qualified for the position from which he was discharged; and (4) was replaced by someone under forty, replaced by someone younger, or was otherwise discharged because of age. Russo, 93 S.W.3d at 435. If the plaintiff makes this showing, the burden then shifts to the defendant-employer to articulate a “legitimate, nondiscriminatory reason” for the plaintiff’s discharge. Quantum Chem., 47 S.W.3d at 477 (quoting McDonnell Douglas, 411 U.S. at 802). If the defendant can articulate such a reason, the presumption of discrimination created by the plaintiff’s prima facie showing is eliminated, and the burden shifts back to the plaintiff to show the defendant’s stated reason was a pretext for discrimination. Id. The Texas Supreme Court has held that under the TCHRA, a plaintiff need only prove that age discrimination was “a motivating factor” in the termination decision. Id. at 480. The second type of employment discrimination case is the mixed-motive case, in which the plaintiff has direct evidence of discrimination in the employment decision. Price Waterhouse v. Hopkins, 490 U.S. 228, 244–45 (1989). Whether a case will be classified as a pretext case or a mixed-motive case “depends entirely” on whether the plaintiff has direct evidence that discriminatory motives influenced the employer’s decision to terminate the plaintiff. Quantum Chem., 47 S.W.3d at 476. If the plaintiff has only circumstantial evidence that the employment decision was motivated by discrimination, the case will be classified as a pretext case “regardless of how many motives the employer had.” Id. at 477. SOURCE: San Antonio Court of Appeals - 04-10-00730-CV - 6/22/11

TCHRA Retaliation claim against Employer

RETALIATION CLAIM In an action for retaliation brought under the TCHRA [ Texas Commission on Human Rights Act, no Section 21 of the Labor Code ] , the plaintiff-employee must make a prima facie showing that: (1) he engaged in a protected activity, (2) an adverse employment action occurred, and (3) a causal link existed between the protected activity and the adverse action. Dias v. Goodman Mfg. Co., L.P., 214 S.W.3d 672, 676 (Tex. App.—Houston [14th Dist.] 2007, pet. denied). Protected activities include: (1) opposing a discriminatory practice; (2) making or filing a charge; (3) filing a complaint; or (4) testifying, assisting, or participating in any manner in an investigation, proceeding, or hearing. Id. (citing TEX. LAB. CODE ANN. § 21.055). If the plaintiff makes this showing, the burden shifts to the defendant-employer to articulate a legitimate, nondiscriminatory reason for the adverse employment action. Id. SOURCE: San Antonio Court of Appeals - 04-10-00730-CV - 6/22/11 AGE DISCRIMINATION CLAIM Under the THCRA: An employer commits an unlawful employment practice if because of race, color, disability, religion, sex, national origin, or age the employer: (1) fails or refuses to hire an individual, discharges an individual, or discriminates in any other manner against an individual in connection with compensation or the terms, conditions, or privileges of employment; or (2) limits, segregates, or classifies an employee or applicant for employment in a manner that would deprive or tend to deprive an individual of any employment opportunity or adversely affect in any other manner the status of an employee. TEX. LAB. CODE ANN. § 21.051 (West 2006). The TCHRA also provides: (a) Except as otherwise provided by this chapter, an unlawful employment practice is established when the complainant demonstrates that race, color, sex, national origin, religion, age, or disability was a motivating factor for an employment practice, even if other factors also motivated the practice, unless race, color, sex, national origin, religion, age, or disability is combined with objective job-related factors to attain diversity in the employer’s work force. (b) In a complaint in which a complainant proves a violation under Subsection (a) and a respondent demonstrates that the respondent would have taken the same action in the absence of the impermissible motivating factor, the court may grant declaratory relief, injunctive relief except as otherwise provided by this subsection, and attorney’s fees and costs demonstrated to be directly attributable only to the pursuit of a complaint under Subsection (a), but may not award damages or issue an order requiring an admission, reinstatement, hiring, promotion, or back pay. Id. § 21.125. Because the TCHRA’s stated purpose is to “provide for the execution of the policies of Title VII of the Civil Rights Act of 1964 and its subsequent amendments,” Texas courts apply analogous federal case law when interpreting the Texas statute. Id. § 21.001(1); Quantum Chem. Corp. v. Toennies, 47 S.W.3d 473, 476 (Tex. 2001). SOURCE: San Antonio Court of Appeals - 04-10-00730-CV - 6/22/11

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