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Court of Appeals of Texas, El Paso.

STEVEN PAINTER, Individually; TONYA WRIGHT, Individually and as Representative of the Estate of EARL WRIGHT, III;TABATHA ROSELLO RIOS, as Next Friend of ALBERT A. CARRILLO, JR., a Minor; and VIRGINA WEAVER, Individually, Appellants,

v.

AMERIMEX DRILLING I, LTD., Appellee.

No. 08-19-00226-CV

|

April 12, 2021

Appeal from the 83rd District Court of Pecos County, Texas (TC#P-6666-B-83-CV)

Before Rodriguez, C.J., Palafox, J., and Ferguson, Judge

Ferguson, Judge, sitting by assignment

OPINION

YVONNE T. RODRIGUEZ, Chief Justice

This is an appeal from the grant of a traditional motion for summary judgment in a common-law negligence suit. The court below determined the Workers’ Compensation Act (“the Act”) barred the negligence claims brought against Amerimex Drilling I, Ltd. (“Amerimex”), by Appellants who alleged it was vicariously liable for the deaths of two employees, Earl Wright, III and Albert Carrillo, as well as the serious bodily injuries sustained by a third employee, Steven Painter, (collectively “passengers” or “crew”). The deaths and injuries arose from a 2007 roll-over vehicular collision allegedly caused by a fourth employee, J.C. Burchett (“Burchett” or “the driver”), who was driving the men in his personal vehicle from a remote worksite to a “bunkhouse” at the end of the crew’s workday.

In a previous appeal in this case, the Texas Supreme Court determined a fact issue existed as to whether the driver was acting in the course and scope of his employment with Amerimex at the time of the collision, overruling our determination that summary judgment was appropriate, and remanded the case to the trial court for further proceedings. See Painter v. Amerimex Drilling I, Ltd. (Painter I), 561 S.W.3d 125, 139 (Tex. 2018). On remand, Amerimex filed a second traditional motion for summary judgment, this time contending the evidence conclusively established its affirmative defense1 that the Act barred the Appellants’ negligence claims because the passengers were acting in the course and scope of their employment at the time of the collision and Appellants were therefore limited to compensation under the Act. The trial court agreed and granted Amerimex’s motion for summary judgment.

In three issues, Appellants contend the trial court erred in granting summary judgment on Amerimex’s affirmative defense because the evidence does not conclusively establish the passengers were acting within the course and scope of their employment at the time of the collision. First, Appellants contend the passengers’ injuries were not related to, nor did they originate in, the work of Amerimex, as required by the Act’s definition of course and scope of employment. Second, even if the injuries related to or originated in Amerimex’s business, Appellants contend the injuries were sustained while the crew was using the public streets and highways to come and go from the jobsite, which is transportation activity expressly excluded from the Act’s definition of course and scope. See TEX.LAB.CODE ANN. § 401.011(12)(excluding from the Act’s definition of course and scope of employment “transportation to and from the place of employment”). Third, Appellants contend Amerimex does not conclusively demonstrate that the transportation in this case meets the requirements of the exceptions to the transportation exclusion upon which Amerimex relies. See TEX.LAB.CODE ANN. § 401.011(12)(A)(i) and (ii)(excepting from the transportation exclusion transportation that is “paid for by the employer” or “under the control of the employer”).

BACKGROUND

We adopt the background facts stated in Painter I:

Sandridge Energy, Inc., hired Amerimex Drilling I, Ltd., to drill oil-and-gas wells on the Longfellow Ranch in Pecos County. Amerimex provided mobile bunkhouses for its crews and typically located those bunkhouses at the drilling site. However, Sandridge did not allow bunkhouses on the ranch, requiring them to be moved approximately 30 miles away to Fort Stockton. The Sandridge–Amerimex contract accounted for this circumstance by mandating a bonus payment to the crew’s driller to drive the crew to the site. Specifically, the contract provided that “[Amerimex] shall invoice [Sandridge] for and pay each Driller to receive [sic] $50/day to drive crew out to well location.” Amerimex did not require its crews to stay at the bunkhouse or ride with the driller, although it appears undisputed that they typically did both. Further, Amerimex placed no restrictions on what route they took between the bunkhouse and the drilling site or where they stopped along the way.

The Amerimex crews assigned to the Longfellow Ranch project worked twelve-hour shifts on a seven-days-on, seven-days-off schedule. J.C. Burchett was the driller on one of those crews and was paid the daily bonus to drive his crew between the bunkhouse and the ranch in his own truck. Burchett and his crew members—Steven Painter, Earl Wright, and Albert Carillo—all lived significantly farther from the ranch than Fort Stockton, so they generally stayed at the bunkhouse. However, on one or two occasions, Burchett drove with the crew to Big Spring (where Burchett and at least one other crew member lived) after their shift instead of back to the bunkhouse.

On February 28, 2007, Burchett was driving the crew from the ranch back to the bunkhouse after their shift ended. He struck another vehicle driven by Sarah Pena, resulting in a rollover that killed Wright and Carillo and injured Painter and Burchett. Burchett sought and received workers’ compensation benefits following a contested case hearing before the Texas Department of Insurance Workers’ Compensation Division. Amerimex argued in that hearing that Burchett was acting in the course and scope of his employment at the time of the accident, and the Division ultimately found Burchett’s injury compensable because he was paid to transport the crew between the ranch and the bunkhouse, furthering Amerimex’s business interests.

Painter and the deceased crew members’ representatives and beneficiaries (collectively, Painter) did not seek workers’ compensation benefits. However, Amerimex initiated proceedings at the Division to determine whether the injuries suffered by Painter, Wright, and Carillo were covered by its workers’ compensation policy. A Division appeals panel concluded that Amerimex lacked standing to do so and that, in any event, the employees were not injured in the course and scope of their employment and thus did not sustain compensable injuries. In re Tex. Mut. Ins. Co., 331 S.W.3d 70, 73 (Tex.App.—Eastland 2010, orig. proceeding).

Painter I, 561 S.W.3d at 128-29 [Footnotes omitted].

STANDARD OF REVIEW

We review a trial court’s ruling on a motion for summary judgment de novo. Valley Forge Motor Co. v. Sifuentes, 595 S.W.3d 871, 876-77 (Tex.App.—El Paso 2020, no pet.). When reviewing a traditional motion for summary judgment, as opposed to a no-evidence motion, the burden is on the movant to show there exists no genuine issue of material fact such that the movant is entitled to judgment as a matter of law. TEX.R.CIV.P. 166a(c). We accept as true all evidence favorable to the non-movant, indulge every reasonable inference, and resolve any doubts in the non-movant’s favor. Sifuentes, 595 S.W.3d at 876. A defendant moving for summary judgment on an affirmative defense has the burden to establish conclusively that defense. McIntyre v. Ramirez, 109 S.W.3d 741, 748 (Tex. 2003).

The Act’s exclusive remedy provision is an affirmative defense that the defendant must plead and prove. Reveles, 574 S.W.3d at 37; Rico v. Judson Lofts, Ltd., 404 S.W.3d 762, 765 (Tex.App.—San Antonio 2013, pet. denied). To prove the affirmative defense, a defendant must show that the injured worker was: (1) its employee at the time of the work-related injury or death; and (2) the work-related injury or death was compensable by workers’ compensation insurance. TEX.LAB.CODE ANN. § 408.001(a), § 401.011(10).

DISCUSSION

I. The Workers’ Compensation Act

The Act serves as “a mechanism by which workers [can] recover from subscribing employers without regard to the workers’ own negligence while limiting the employers’ exposure to uncertain, possibly high damage awards permitted under the common law.” SeaBright Ins. Co. v. Lopez, 465 S.W.3d 637, 642 (Tex. 2015). “The Act ultimately struck a bargain that allows employees to receive a lower, but more certain, recovery than would have been possible under the common law.” Id. [Internal quotations omitted]. The Act defines a “[c]ompensable injury” as “an injury that arises out of and in the course and scope of employment for which compensation is payable under this subtitle.” TEX.LAB.CODE ANN. § 401.011(10). “Course and scope of employment” is defined by the Act in relevant part as follows:

[A]n activity of any kind or character that has to do with and originates in the work, business, trade, or profession of the employer and that is performed by an employee while engaged in or about the furtherance of the affairs or business of the employer. The term includes an activity conducted on the premises of the employer or at other locations.

TEX.LAB.CODE ANN. § 401.011(12). Thus, the Act’s definition of “course and scope” requires “the injury to (1) relate to or originate in, and (2) occur in the furtherance of, the employer’s business.” See Lopez, 465 S.W.3d at 642 (citing Leordeanu v. Am. Protection Ins. Co., 330 S.W.3d 239, 241 (Tex. 2010)) [Internal quotations omitted].

In addition, the Act expressly excludes from the definition of course and scope “transportation to and from the place of employment ....” See TEX.LAB.CODE ANN. § 401.011(12). Known as the “coming and going” rule, the rationale for the exclusion is that an injury occurring while using the public streets or highways in going to and returning from the place of employment is in most instances “suffered as a consequence of risks and hazards to which all members of the traveling public are subject rather than risks and hazards having to do with and originating in the work or business of the employer.” Janak v. Tex. Employers’ Ins. Assoc., 381 S.W.2d 176, 178 (Tex. 1964).

Exceptions to this transportation exclusion are set forth in Section 401.011(12), subsections (A)-(B) which claw back some forms of coming and going activity that may constitute course and scope activity as defined by the Act. See TEX.LAB.CODE ANN. § 401.011(12)(A)-(B). Meeting the exception requirements, however, does not necessarily mean the course and scope requirements are also met. See Lopez, 465 S.W.3d at 645 (“[b]oth the origination and furtherance elements must be satisfied even if an employee qualifies for one of the exceptions to an exclusion”); see also Freeman v. Tex. Comp. Ins., 603 S.W.2d 186, 192 (Tex. 1980)(exceptions to transportation exclusion do “not enlarge the definition of ‘course of employment’ ”). Consequently, even if Amerimex can show the coming and going in this case satisfies one or more of the exceptions to the transportation exclusion, Amerimex must still also establish that the activity in which the crew members were engaged at the time of the collision falls within the Act’s definition of course and scope of employment.

II. Course and Scope of Employment

In its first issue, Appellants contend Amerimex fails to conclusively establish at the time of the collision the crew was engaged in activity that was “relate[d] to” or that “originate[d] in” Amerimex’s business.2 Specifically, Appellants argue the evidence establishes a genuine issue of material fact about whether the relationship between the crew’s travel and their employment was not “so close that it can fairly be said that the injury had to do with and originated in the work, business, trade or profession of the employer.” See Lopez, 465 S.W.3d at 642.

According to Appellants, the following undisputed facts create a fact issue as to origination: (1) only the driver was paid daily to transport crew members who were not required by Amerimex to travel in the driver’s personal vehicle; (2) the crew was not performing any service for Amerimex after leaving the jobsite because, unlike the driver, they were free to do as they pleased once they left the jobsite; (3) the crew was not required to stay at the bunkhouse; (4) the crew was paid an hourly wage, for fixed hours, at a fixed location, and they were not paid for daily travel to and from the jobsite; (5) at the time of the collision, the crew’s workday had ended and they were off the clock.

Amerimex on the other hand argues the evidence conclusively establishes the crew’s travel was “dictated by Amerimex’s business model” and “enabled by Amerimex,” and therefore originated in Amerimex’s business as a matter of law. See Lopez, 465 S.W.3d at 644 (observing that injured worker’s travel from temporary housing to remote jobsite were “dictated by [employer’s] business model and enabled by [the employer’s] provision of the vehicle and payment of per diem and other expenses”).

To support its argument, Amerimex points to the following undisputed evidence: (1) as an oil-well drilling contractor, Amerimex’s business required its employees to work at temporary remote worksites; (2) Amerimex made available to the crew free temporary housing which was usually erected at the jobsite, but on this project was placed 30 miles away from the jobsite; and (3) Amerimex was contractually obligated to make available to the crew a free ride to and from the jobsite.

Both parties agree that the Texas Supreme Court’s origination analysis in Lopez controls the outcome of this case, so, we begin our analysis there.

A. SeaBright Ins. Co. v. Lopez

In Lopez, an insurance carrier in a workers’ compensation case challenged a summary judgment determining the deceased employee, Candelario Lopez (“Lopez”), was acting within the course and scope of his employment while he was driving himself and two other employees in a company vehicle from temporary housing to a remote jobsite. Lopez, 465 S.W.3d at 640. When considering the question of whether Lopez was engaged in activity that “originated” in the company’s business at the time of his death, the court recognized a distinction between “the risks to which employees are exposed while traveling to and from work [that] are shared by society as a whole and do not arise as a result of the work of employers” and instances where “the relationship between the travel and the employment is so close that it can fairly be said that the injury had to do with and originated in the work, business, trade or profession of the employer.” Id. at 642 (citing Shelton v. Standard Ins., Co. 389 S.W.2d 290, 292 (Tex. 1965)).

The requisite degree of proximity between the travel at issue and employment necessary to meet the origination requirement “is satisfied if the employee’s travel was pursuant to express or implied conditions of his employment contract.” Id. (citing Meyer v. W. Fire Ins. Co., 425 S.W.2d 628, 629 (Tex. 1968)) [Internal quotations omitted]. This inquiry is a “fact-intensive” one “focusing on the nature of the employee’s job, the circumstances of the travel, and any other relevant facts.” Lopez, 465 S.W.3d at 642-43.

B. The “Conclusive” Evidence of Origination in SeaBright Ins. Co. v. Lopez

When considering whether the evidence conclusively established as a matter of law that the conditions of Lopez’s employment included travel, the court considered as its “starting point” evidence of the employer’s business. Lopez, 465 S.W.3d at 643-44. The court next considered the nature of the injured employee’s employment within that business. Id. The court emphasized, however, that the focus must be on the latter, as well as “the circumstances of the travel, and any other relevant facts.” Id. at 643.

Specifically, the court emphasized the following evidence present in that case: (1) the employer, Interstate Treating, Inc., fabricated and installed materials for the oil and gas processing industry, which “called for employing specialized, non-local work crews in constantly changing, remote locations on temporary assignments,” and “[a]lthough [the company] could have hired local employees at each temporary, remote job site, its general practice was to hire people who had worked on previous installation jobs,” id. at 640, 643-44; (2) Lopez’s job, as a civil foreman, was to “oversee the installation of all of the plant’s concrete foundations and the placement of the plant’s equipment,” and he was paid a per diem to offset lodging and food expense, and although he could stay at any motel he wished, he was expected to secure temporary lodging, id.; (3) in order to perform his job, Lopez requested and was provided a company vehicle, for which the company paid fuel and insurance, and which Lopez used to drive to and from remote job sites, id.; (4) on the day of the collision, Lopez was driving himself and two of his coworkers from temporary housing to the remote jobsite in the company vehicle. Id.

After discussing this evidence, the court concluded that the relationship between Lopez’s travel and his employment was so close it could fairly be said his death had to do with and originated in the company’s business because Lopez’ travel was “more akin to those employees such as deliverymen, messengers, collectors, and others, who by the very nature of the work they have contracted to do are subjected to the perils and hazards of the streets.” Id. at 644. Notably, Lopez is silent as to whether the employees traveling as passengers in the company car with Lopez were acting in the course and scope of their employment.

C. Lopez’s Application to This Case

After comparing the evidence in Lopez with the evidence in this case, for three reasons we agree with Appellants that a fact issue exists as to whether the relationship between the crew’s travel in this case and the conditions of their employment was so close it can fairly be said their deaths and injuries originated in the work, business, trade or profession of Amerimex.

First, Amerimex fails to point us in the direction of any evidence describing the nature of the jobs held by Wright, Carrillo, or Painter that would demonstrate the conditions of their employment required them to travel beyond coming and going to work. Instead, Amerimex points to evidence establishing the nature of Burchett’s job which included a daily obligation to make available to the crew a free ride to and from the jobsite as a condition of Burchett’s employment. But the conditions of Burchett’s employment do not speak to whether travel was sufficiently tied to the conditions of Wright, Carrillo, or Painter’s employment. See Lopez, 465 S.W.3d at 642-43 (origination inquiry focuses on the nature of the injured employee’s job).

Amerimex presents no evidence establishing, for example, that the crew shared Burchett’s responsibility of driving fellow crew members to and from the jobsite or that they were compensated for doing so. Rather, it is undisputed that only Burchett was assigned and paid to perform that duty. These facts distinguish this case from Inge, a case relied upon by Amerimex, in which the employer expected one of its employees to transport the other workers to and from the drilling site and paid that employee to do so. Texas Employers’ Ins. Ass’n v. Inge, 208 S.W.2d 867, 867 (Tex. 1948). The employer in that case allowed the workers to determine which employee would drive and they chose Inge. Id. at 867-68. Inge later died in a car accident on a return trip from work, and the trial court concluded that Inge was acting in the course and scope of his employment. Id. at 869. By contrast, the crew members in this case were neither expected to drive for the company, nor were they driving at the time of the collision.

And there is much evidence in this record establishing that the crew’s conditions of employment did not include driving for Amerimex. According to Glen Murphree, Amerimex’s CFO, when it came to the crew, Amerimex was only concerned with their activity while they were at the jobsite. When they were off the jobsite, the crew could do as it pleased.3 Nor is there any evidence establishing that while performing their job at the jobsite, the crew was expected to travel from the rig or between rigs to pick up supplies or transport workers. Indeed, when Murphree was asked whether Amerimex did anything to confirm whether the crew possessed valid driver’s licenses, he testified unequivocally:

[Murphree]. I didn’t care whether they had a ... valid driver’s license or not.

Q. Even J.C. Burchett?

[Murphree]. I didn’t know how they was getting to work. They can all come together. They can drive themselves. They could ride a burro. I didn’t care.... They weren’t driving for me—for Amerimex.

By contrast, in Lopez, when discussing the nature of Lopez’s job with the company the court found it significant that Lopez requested and was provided a company vehicle, presumably because such facts permitted an inference--not present here--that in addition to coming and going, an express condition of Lopez’s job required him to drive frequently between “constantly changing” jobsites and for significant periods of time. In our view, it was this condition of employment, acknowledged by both Lopez and the company, more than any other, that made Lopez akin to a deliveryman, whose only job is to deliver packages on a daily basis from door to door using the public streets while operating transportation furnished or paid by an employer who is in the business of delivering packages.

Here, the $50 bonus paid to Burchett to make available a free ride in his personal vehicle after the completion of the crew’s workday, does not sufficiently tether the crew’s employment to travel. And this record does not contain the type of evidence this Court and others have found determinative when concluding traveling passengers were in fact acting within the course and scope of their employment for purposes of the Act. For example, there is no evidence that the crew was required to ride with Burchett or that a crew member’s refusal to ride with Burchett would result in termination, see, e.g., Liberty Mut. Ins. Co. v. Chesnut, 539 S.W.2d 924, 927 (Tex.App.—El Paso 1976, writ ref’d n.r.e.)(upholding jury verdict finding employee passengers were acting within course and scope of employment while traveling to job site in vehicle driven by driller in part because driller could fire a crew member who refused to ride with him); or that the crew members themselves had insisted on being provided free transportation by the company before agreeing to accept the job, see, e.g., Chesnut, 539 S.W.2d at 927 (testimony from driller establishing neither he nor the crew would work without free transportation);4 or that the crew was paid to travel to and from the jobsite, see id. (testimony “place[d] both the driller and the crew in a position of being paid during the time of going to and from the rig site”); or that at the time of the collision, the crew had undertaken a special mission at Amerimex’s direction for which all of the occupants were responsible, see Janak, 381 S.W.2d at 179 (finding passengers traveling in vehicle driven by coworker were in course and scope because “obligation to procure and transport ice and water” was shared by all crew members each day);5 or that the crew members were furnished a company vehicle and a company credit card to pay for fuel. See Pesqueda v. Martinez, No. 04-16-00568-CV, 2017 WL 5759382, at *5 (Tex.App.—San Antonio Nov. 29, 2017, no pet.)(mem. op.). While these examples are by no means exclusive, they illustrate why Amerimex falls short of establishing as a matter of law the crew in this case was acting in the scope and course of their employment.

Second, the evidence does not conclusively establish that the assignment of the driving duty to Burchett, or travel to and from the jobsite was part of Amerimex’s established business model. Indeed, Murphree testified that the bonus arrangement Amerimex had with Burchett was a one-off because Amerimex normally placed the bunkhouse on the jobsite, making daily coming-and-going travel unnecessary on previous jobs. According to Murphree, on this job, however, the surface owner refused to permit Sandridge to erect bunkhouses at the rig site and instead, required Amerimex to send its bunkhouse “to town,” which was the “first time [Murphree] ever [saw] it or witnessed” such a thing and “[i]t was the only situation [Amerimex was] involved in like that.”

This testimony suggests that when it came to travel, Amerimex’s usual business model was structured so that daily travel was not a condition of the crew’s employment, which explains why Amerimex was not inclined to provide additional pay for daily travel on this job either. Indeed evidence establishes that while Amerimex cut the check paid to Burchett, it was Sandridge that provided the funding. Moreover, even after Amerimex assigned Burchett the driving task for which the bonus could be earned, Amerimex did nothing to require or encourage the crew members to accept the ride.6 Murphree’s testimony was unequivocal that “Amerimex Drilling does not transport employees” and that Amerimex did not concern itself with how the crew arrived at or left the rig as long as the crew showed up for work on time. This testimony further strengthens Appellants’ contention that Amerimex’s business model did not dictate the crew’s travel and that the crew members’ deaths and injuries did not originate in Amerimex’s business.

Third, evidence establishes the crew passengers were paid a fixed hourly rate of pay, for fixed hours, which began and ended at a fixed jobsite; they were not paid for travel, and the collision occurred while they were traveling as passengers, off duty, out of hours, off the jobsite, and on the way to a fixed housing location7 after the completion of their workday. These facts further weigh against a finding that the crew was in the course and scope of their employment at the time of the collision. See, e.g., Rodriguez v. Great American Indemnity Co., 244 F.2d 484, 488 (5th Cir. 1957)(employee who died in a fire while sleeping in a hotel near a remote jobsite was not in course and scope of employment because employee’s job was one with “regular hours at a regular rate of pay per hour and at a regular place of work”).

In the end, we are faced with only three facts that we can confidently say Amerimex conclusively established as a matter of law: (1) the crew was working at a remote jobsite; and (2) Amerimex made available to the crew, a free ride to and from the jobsite and free housing; and (3) the crew was going to the free housing at the time of the collision. In our view, these facts standing alone are insufficient to demonstrate as a matter of law the crew members were acting in the course and scope of their employment for purposes of the Act at the time of the collision. See, e.g., Am. Gen. Ins. Co. v. Coleman, 303 S.W.2d 370, 376 (Tex.1957)(“the mere gratuitous furnishing of transportation by the employer to the employee as an accommodation ... does not bring the employee, when injured in the course of traveling on streets and highways, within the protection of the Workmen’s Compensation Act”). This is especially true in light of Murphree’s testimony in this case that the crew passengers were free to do what they pleased as soon as they left the jobsite. For these reasons, we sustain Appellants’ first issue. We do not reach Appellants’ remaining issues. TEX.R.APP.P. 47.1. We therefore reverse the grant of summary judgment and remand to the trial court for further proceedings.

Footnotes

1

The “exclusive remedy” provision found in Section 408.001(a) of the Texas Workers’ Compensation Act is an affirmative defense that protects subscribing employers from common-law claims, including negligence, that could otherwise be brought by employees for work-related injuries. Reveles v. OEP Holdings, Inc. 574 S.W.3d 34, 37 (Tex.App.—El Paso 2018, no pet.). The affirmative defense does not apply to an employee’s negligence suit if the employee was not acting within the course and scope of his employment at the time of injury because such injuries are not “compensable” under the Act. TEX.LAB.CODE ANN. § 401.011(10).

2

Appellants concede the second element of the “course and scope” definition because it is well established travel to and from work furthers an employer’s business. See Leordeanu, 330 S.W.3d at 242 (recognizing “[a]n employee’s travel to and from work makes employment possible and thus furthers the employer’s business”); Lopez, 465 S.W.3d at 644-45 (same).

3

Murphree testified as follows:

“A. I don’t transport employees. Amerimex Drilling does not transport employees. They can get to work any way they want to get to work. They start work when they get to the rig, and that’s when work begins.... Outside that, you know, we have no control over them.”

...

“A. The employees are hired to work, to get to the rig however they want to get there. They can walk, drive, they can sleep under a bush at night, they don’t have to go to the deal. They don’t have to go to the bunkhouse. They’ve just got to show up when their shift begins, or we’re going to have to look for another employee.”

...

Murphree said it was his “understanding” that when the passengers’ shift ended at 6 a.m. on the day of the collision, the crew was completely “off the clock.”

...

“A. They could go home. They could go to the bunkhouse. They could go dancing. They could go drinking. They could do whatever. We wouldn’t expect to see them until the next morning.”

4

While there is evidence suggesting that Sandridge and Amerimex discussed the bonus as a necessary part of the contract between them, there is no evidence in this record establishing that the injured crew members themselves insisted on a free ride as a condition of acceptance of employment.

5

Amerimex cites to Janak for the proposition that “the Texas Supreme Court has rejected attempts to draw imaginary lines between the driver and the crew for decades.” However, the evidence in Janak established that at the time of the collision the workers were on a journey to accomplish a task for the company for which each of them had an obligation to discharge, i.e. pick up and transport water and ice to the jobsite because there was no water at the drillsite. Janak, 381 S.W.2d at 178, 179. Here the evidence establishes that only Burchett was assigned the duty, and paid, to make available free transportation to and from the jobsite. Consequently, we do not believe the line between Burchett and the crew in this case is “imaginary.”

6

At oral argument, Amerimex’s counsel suggested that the crew’s ability to choose to ride in their own vehicle is not probative of origination. Counsel argued that the “hypothetical” scenario in which the crew members had chosen to drive their own vehicles instead of accepting the ride from Burchett is irrelevant to our inquiry because when the collision occurred the crew had made the choice to ride with Burchett, and according to Amerimex that choice placed the crew within the scope of their employment. We are not persuaded by this argument. Either the conditions of the crew’s employment included travel or they did not. In other words, conditions of employment do not normally hinge on a unilateral decision by either the employer or the employee, but on a mutual understanding of expectations. Here, if both Amerimex and the crew had acknowledged in a written contract that travel was in fact a condition of the crew’s employment, it would not matter if the crew member was driving his own vehicle or riding as a passenger in a coworker’s vehicle, both scenarios would lead to the same conclusion that the crew member was within the scope of his employment. In this case, however, as there is no written contract between Amerimex and the crew members, we must gleen what we can from the duties assigned, limitations and/or liberties imposed or not, by the rules set by the employer and understood by the employee. Consequently, in this context, Amerimex’s decision to permit the crew to make an unconditional “choice” as to the mode of transportation to and from the jobsite suggests travel was not encompassed within the scope of the crew’s employment because an employee normally cannot unilaterally establish his conditions of his employment. By contrast, Burchett did not have the “choice” to refuse to drive the crew because he was specifically assigned the task by Amerimex and Burchett understood it was his job to do so, which suggests his activity at the time of the collision was a condition of his employment.

7

Amerimex’s briefing characterizes the rig as a temporary jobsite, but there is no evidence suggesting that these employees were required to travel to more than one jobsite during the relevant timeframe. Nor is there evidence that the bunkhouse location changed while they were working on this job. These facts further distinguish this case from Lopez, where the work locations were “constantly changing” requiring the employee to stay in different motels.

Court of Appeals of Texas, El Paso.

Hugo A. MARTINEZ, Dolores Ramiriz, Individually and on Behalf of the Estate of Javier Garcia, Jr. Deceased, Javier Mayagoitia, Sr., Individually and as Independent Administrator of the Estate of Javier Mayagoitia, Jr. Deceased, Julieta Taylor, Osman Martinez and Jeanne Chavez, Individually and as Next Friend and Guardian of M.C., a Minor Child, Appellants,

v.

David BOONE, Individually, David Boone Oilfiled Consulting, Inc. and Cameron International Corporation a/k/a Cameron Systems Corporation, Appellees.

No. 08-19-00086-CV

|

March 29, 2021

Appeal from the 143rd District Court of Reeves County, Texas (TC# 19-02-22824-CVR)

Attorneys & Firms

Maxey Marie Scherr, James F. Scherr, Jeffrey B. Pownell, El Paso, Brittany Lopez, for Appellants Hugo A. Martinez and Dolores Ramirez, Individually and on Behalf of the Estate of Javier Garcia, Jr., Deceased.

Jonathan S. Stoger, Fredrick Mandell, Bill Weinacht, Pecos, for Appellants Javier Mayagoitia and Julieta Taylor.

Fredrick Mandell, Santiago D. Hernandez, San Antonio, for Appellants Chavez, Jeanne.

Piero Garcia, Carlos Alberto Leon, Sugar Land, Kirk L. Pittard, Dallas, Dana Brooke Levy, for Appellants Martinez, Osman.

Carlos Rincon, Oscar A. Lara, El Paso, for Appellees David Boone, Individually and David Boone Oilfield Consulting, Inc.

Lucas T. Elliot, Harper Estes, Midland, Thomas F. Allen Jr., Dallas, for Appellees Cameron International Corporation a/k/a Cameron Systems Corporation.

Before Rodriguez, C.J., Palafox, and Alley, JJ.

OPINION

YVONNE T. RODRIGUEZ, Chief Justice

Traditional summary judgment motions and no-evidence summary judgment motions were granted against Appellants by the trial court. In four issues, Appellants assert fact issues exist as to whether Appellees (“Boone” and “Cameron”) are liable under the doctrine of respondeat superior, general agency principles, and direct negligence, thereby precluding traditional and no-evidence summary judgment.

BACKGROUND

Factual Background

John Mueller (“Mueller”) was involved in an auto collision resulting in several fatalities. At the time of the collision, Mueller was returning to a remote oil wellsite he was working on named the “Blue Marlin.” The details of the collision are not at issue here. We address only the question of whether Boone or Cameron is liable for the conduct of Mueller if he were found negligent in causing the collision.

At the end of his shift on June 8, 2015, Mueller, along with Cameron’s lead man, Valadez, traveled to Pecos, Texas for dinner. After dinner, Mueller stopped at a local Wal-Mart to purchase water and other supplies for the wellsite. He then drove back to the wellsite to sleep for the night, and as we describe below, to learn if additional work would be available the next day. En route to the wellsite, he was involved in the collision giving rise to this lawsuit.

The wellsite is located about sixty-five miles from the nearest town, Pecos. There are no nearby facilities for water, food, or fuel. A trip to Pecos is a 130-mile round-trip that takes three hours. ConocoPhillips owns the oil and gas lease of the well. ConocoPhillips contracted with Cameron to conduct “flowback well testing.” The process involves analyzing the output of a well to determine the output quantity of water, gas, and oil. The output is sent to a fracking tank where sand and hydraulic fracturing fluids are removed, and the remaining oil, gas, and water levels are measured at various time increments.

To obtain workers for the Blue Marlin, Cameron asked Boone to provide labor for the flowback testing. Boone can best be described as a placement agency that provides laborers to companies. Cameron contacted Boone and asked for two well test hands. A scheduler for Boone then contacted Mueller, who was available for the Blue Marlin job.

Procedural Background

Appellants, the estate representatives and wrongful death beneficiaries for Javier Mayagoitia and Javier Garcia, along with Hugo and Osman Martinez sued Mueller, Boone, Cameron, and ConocoPhillips.

Appellants alleged Boone and Cameron were both vicariously and directly liable for Mueller’s conduct as we describe below. Boone and Cameron filed traditional and no-evidence motions for summary judgment, which the trial court granted. This appeal followed.

DISCUSSION

Appellants assert four issues on appeal. Issue One claims the trial court erred by granting the summary judgment motions of Boone and Cameron. See Malooly Bros. v. Napier, 461 S.W.2d 119, 121 (Tex. 1970)(allowing general issue challenging summary judgment). In Issue Two, Appellants contend the summary judgment evidence raises fact issues as to whether Boone and Cameron are vicariously liable under the doctrine of respondeat superior. Issue Three asserts there are fact issues as to whether Boone and Cameron are vicariously liable under general agency principles. Last, Issue Four contends fact issues exist concerning the direct negligence of Boone and Cameron.

Standard of Review

We review a trial court’s decision to grant summary judgment de novo. Travelers Insurance Company v. Joachim, 315 S.W.3d 860, 862 (Tex. 2010). A party is permitted to move for a no-evidence summary judgment “without presenting summary judgment evidence,” but the moving party must “state the elements as to which there is no evidence.” TEX.R.CIV.P. 166a(i); Wade Oil & Gas, Inc. v. Telesis Operating Company, Inc., 417 S.W.3d 531, 540 (Tex.App.—El Paso 2013, no pet.). A no-evidence motion for summary judgment is essentially a pretrial directed verdict, and we apply the same legal sufficiency standard of review as we would for a directed verdict. King Ranch, Inc. v. Chapman, 118 S.W.3d 742, 750-51 (Tex. 2003).

Under this standard, a no-evidence motion for summary judgment should be granted when: (1) there is an absence of evidence of a vital fact; (2) the court is barred by rules of evidence or law to give weight to the only evidence provided; (3) the evidence offered is no more than a mere scintilla; or (4) the evidence presented conclusively establishes the complete opposite of the vital fact. Id. at 751. More than a scintilla of evidence exists when reasonable and fair-minded individuals could differ in their conclusions. Id. Stated otherwise, less than a scintilla of evidence is when the evidence is so weak as to do no more than create a mere surmise or suspicion of material fact. Wade Oil & Gas, 417 S.W.3d at 540.

The moving party carries the burden of showing there is no genuine issue of material fact and is entitled to judgment as a matter of law. Diversicare General Partner, Inc. v. Rubio, 185 S.W.3d 842, 846 (Tex. 2005). Once the movant establishes its right to summary judgment, the burden then shifts to the non-movant to present evidence raising a genuine issue of material fact, thereby precluding summary judgment. See City of Houston v. Clear Creek Basin Authority, 589 S.W.2d 671, 678 (Tex. 1979). We review the evidence in the light most favorable to the non-movant. King Ranch, 118 S.W.3d at 751. The motion must be granted unless the non-movant produces summary judgment evidence raising a genuine issue of material fact. TEX.R.CIV.P. 166a(i). When, as here, the trial court’s order “does not specify the grounds for its ruling, summary judgment must be affirmed if any of the grounds on which judgment was sought are meritorious.” Bustamante v. Miranda & Maldonado, P.C., 569 S.W.3d 852, 857 (Tex.App.—El Paso 2019, no pet.).

Law

Generally, an employer is insulated from liability for the tortious acts of its independent contractors. Painter v. Amerimex Drilling I, Ltd., 561 S.W.3d 125, 131 (Tex. 2018)(citing Fifth Club, Inc. v. Ramirez, 196 S.W.3d 788, 796 (Tex. 2006)). However, the common-law doctrine of respondeat superior, or vicarious liability, is an exception to this general rule. Painter, 561 S.W.3d at 131. Under the doctrine of respondeat superior, the “liability for one person’s fault may be imputed to another who is himself entirely without fault solely because of the relationship between them.” St. Joseph Hosp. v. Wolff, 94 S.W.3d 513, 540 (Tex. 2002)(plurality opinion). The “doctrine has been explained as ‘a deliberate allocation of risk’ in line with ‘the general common law notion that one who is in a position to exercise some general control over the situation must exercise it or bear the loss.’ ” Painter, 561 S.W.3d at 130-31.

A. Vicarious Liability for the Acts of “Employees”

An employer-employee relationship is an agency principle that gives rise to vicarious liability. Id. at 131. The first step is determining whether an employer-employee relationship existed. Id. Appellants, as the moving parties, have the burden of proving that at the time of the negligent conduct, Mueller was (1) an employee, and (2) acting in the course and scope of his employment. Id.

In examining employment status, the principal’s right to control over the agent’s actions is the “supreme test” for determining the existence of an employee-employer relationship. Golden Spread Council, Inc. No. 562 of Boy Scouts of Am. v. Akins, 926 S.W.2d 287, 290 (Tex. 1996); Painter, 561 S.W3d at 132 (“the employer’s overall right to control the details of the [agent’s] work is what principally distinguishes an employee from an independent contractor.”). Employee in this context is defined in the pattern jury charge as follows:

[Employee is] a person in the service of another with the understanding, express or implied, that such other person has the right to direct the details of the work and not merely the result to be accomplished.

Agency and Special Relationships, ¶ 10.1, Tex. Pattern Jury Charge (2018). The test for determining whether a worker is an employee or an independent contractor is whether the employer has the right to control the progress, details, and methods of operations of the employee’s work. Thompson v. Travelers Indem. Co. of Rhode Island, 789 S.W.2d 277, 278 (Tex. 1990).

The Texas Supreme Court has provided examples of the type of control normally exercised by an employer: “when and where to begin and stop work, the regularity of hours, the amount of time spent on particular aspects of the work, the tools and appliances used to perform the work, and the physical method or manner of accomplishing the end result.” Id. at 279. We have also described the attributes of an employer as including, “the right to hire and fire, the obligation to pay wages and withhold taxes, the furnishing of tools, and most of all[,] the power to control the details of the worker’s performance.” Painter v. Sandridge Energy, Inc., 511 S.W.3d 713, 724 (Tex.App.—El Paso 2015, pet. denied); see also Thompson, 789 S.W.2d at 278; Newspapers, Inc. v. Love, 380 S.W.2d 582, 585–90 (Tex. 1964). An employer essentially must control the ends sought to be accomplished, and the means and details of its accomplishment. Thompson, 789 S.W.2d at 278.

The second step requires determining whether an employee was acting in the course and scope of employment. Painter, 561 S.W.3d at 131. Course and scope of employment is determined objectively and turns on “whether the employee was performing the tasks generally assigned to him in furtherance of the employer’s business. That is, the employee must be acting with the employer’s authority and for the employer’s benefit.” Id. at 138-39.

B. Vicarious Liability for the Acts of Contractors

Another situation giving rise to vicarious liability is when one contracting party controls the details of another contracting party’s work. A principal is generally not liable for the conduct of independent contractors. Lee Lewis Const., Inc. v. Harrison, 70 S.W.3d 778, 783 (Tex. 2001) (“Ordinarily, a general contractor does not owe a duty to ensure that an independent contractor performs its work in a safe manner.”). However, an exception to the independent contractor rule applies when a general contractor retains some control over the manner in which the independent contractor performs, creating a duty of care. Id.; see also Redinger v. Living, Inc., 689 S.W.2d 415, 418 (Tex. 1985)(adopting Restatement (Second) of Torts § 414 (1977), which imposes a duty on a general contractor who retains control over any part of an independent contractor’s work). The general contractor’s duty of care is commensurate to the control retained over the independent contractor’s work. Lee Lewis Const., 70 S.W.3d at 783. The right to control must also extend to the specific activity from which the injury arose. Hoechst-Celanese Corp. v. Mendez, 967 S.W.2d 354, 357 (Tex. 1998)(requiring a “nexus between an employer’s retained supervisory control and the condition or activity that caused the injury”)[Emphasis in orig.].

The right to control can arise by way of a contractual agreement, or through the exercise of actual control on the worksite. Tovar v. Amarillo Oil Co., 692 S.W.2d 469, 470 (Tex. 1985)(per curiam)(under drilling contract, oil company controlled part of subcontractor’s work and therefore owed a duty of care to oil field worker); Coastal Marine Serv. of Tex., Inc. v. Lawrence, 988 S.W.2d 223, 226 (Tex. 1999)(emphasizing that there must be actual control, and the mere “possibility of control is not evidence of a ‘right to control’ actually retained or exercised.”).

A worksite injury-producing collision can implicate several of the layered contractual relationships that commonly exist in the oil field context. See Painter, 561 S.W.3d at 136 (holding as to employer, summary judgment evidence presented fact question on whether employee, who was transporting work crew to company providing housing, was in the course and scope of employment); Sandridge Energy, Inc., 511 S.W.3d at 716 (holding that out of the very same accident, non-employer contractor was not vicariously liable for tortious conduct because it did not control any aspect of the injury causing event).

Accordingly, in the case at hand, we must determine if issues of material fact exist as to whether Mueller was (1) an employee of either Boone or Cameron, and (2) within the course and scope of his employment at the time of the accident, thereby subjecting the Appellees to vicarious liability for his alleged negligence.

SUMMARY JUDGMENT AS TO CAMERON

A. Was Mueller Cameron’s Employee?

Appellants first assert Mueller was Cameron’s employee by way of contractual agreement, and through evidence of their control over the details of his work at the well. Cameron disagrees, denying Mueller was ever its employee. Cameron further contends, even if Mueller was an employee during his shift on June 8, he was released from employment and was not in the course and scope of employment at the time of the accident. We address each question in turn.

1. Was Mueller an employee of Cameron through the MSA?

A contractual master service agreement (“MSA”) was executed between Cameron and ConocoPhillips. The MSA provides in pertinent part:

[Cameron] shall be fully responsible for and shall have exclusive direction and control of its agents, employees and subcontractors and shall control the manner and method of carrying out operations. All persons engaged by [Cameron] to perform work under this Agreement (including without limit any contract laborers, leased employees or workers furnished to [Cameron] by a staff leasing agency or company) shall be deemed to be employees, and not subcontractors, of [Cameron] for all purposes.

Cameron does not dispute the applicability of the clause or its clear wording. Rather, Cameron argues this Court cannot consider an upstream contract between two parties to define the downstream relationship of a non-signatory to the agreement. In support of its argument, Cameron cites to Gonzalez v. VATR Const. LLC, 418 S.W.3d 777, 786 (Tex.App.—Dallas 2013, no pet.); Cardona v. Simmons Estate Homes I, LP, No. 05-14-00575-CV, 2016 WL 3014792, at *5 (Tex.App.—Dallas May 25, 2016, no pet.)(mem. op.); and Wood v. Phonoscope, Ltd., No. 01–00–01054–CV, 2004 WL 1172900, at *10 (Tex.App.—Houston [1st Dist.] May 27, 2004, no pet.)(mem. op.).

These cases are inapplicable. Although all discuss the duties owed between contracting parties at the work site, the aforementioned cases govern whether a contract creates a duty from one employer to another, as opposed to the employment status of a wrongdoer for purposes of vicarious liability. The Texas Supreme Court has analyzed the contractual terms that define the relationship between parties in the construction context, even when the person described is a non-signatory to the agreement. See Exxon Corp. v. Perez, 842 S.W.2d 629, 630 (Tex. 1992).

Appellants contend the MSA “unequivocally provides that anyone engaged to perform work under the MSA shall be deemed Cameron’s employee ‘for all purposes[,]’ ” and thus, “the MSA resolves the issue [of Mueller’s employment status] as a matter of law.” We recognize the merits of Appellants’ argument, but additional considerations must be addressed.

In Exxon—before reaching the Texas Supreme Court—the San Antonio Court of Appeals held a contract between Exxon and the plaintiff’s employer as determinative of the plaintiff’s employment status. Exxon, 842 S.W.2d at 630. The Texas Supreme Court reversed finding the record was replete with evidence of Exxon’s right to control over the plaintiff—a non-signatory to the agreement—that the court of appeals erred in concluding the contract between the parties alone was conclusive of the plaintiff’s employment status. Exxon, 842 S.W.2d at 630 (finding, irrespective of a contractual agreement between the employer and the plaintiff’s employer, “[w]here the right of control prescribed or retained over an employee is a controverted issue, it is a proper function for the fact-finder to consider what the contract contemplated or whether it was even enforced.”). As in Exxon, Mueller is also a non-signatory to the MSA between Cameron and ConocoPhillips. Moreover, as in Exxon, the summary judgment record is also replete with conflicting evidence of Cameron’s right to control over Mueller. Accordingly, we find the MSA, coupled with the conflicting evidence of Cameron’s right to control, contributes to finding a fact issue of Mueller’s employment status as to Cameron.

2. Was Mueller an employee of Cameron based on a right to control analysis?

Further, Appellants assert they can establish Mueller was an employee through the “right to control” that Cameron exercised over Mueller. The potential for vicarious liability in this context is premised on the relationship between the wrongdoer and the party to whom liability is imputed. Painter, 561 S.W.3d at 132. The defining characteristic is the principal’s “right to control the agent’s actions undertaken to further the principle’s objectives.” Id., (citing FFP Operating Partners, LP v. Duenez, 237 S.W.3d 680, 686 (Tex. 2007)).

To differentiate an employee from an independent contractor, the right to control is measured by examining the Limestone factors: (1) the independent nature of the worker’s business; (2) the worker’s obligation to furnish necessary tools, supplies, and materials to perform the job; (3) the worker’s right to control the progress of the work, except about final results; (4) the time for which the worker is employed; and (5) the method of payment, whether by unit of time or by the job. Limestone Products Distrib., Inc. v. McNamara, 71 S.W.3d 308, 312 (Tex. 2002).

a. Independent nature of the worker’s business

The first Limestone factor asks how independently the worker acted in the workplace. An independent contractor generally has the freedom to “work in his own way.” Koch Ref. Co. v. Chapa, 11 S.W.3d 153, 155 (Tex. 1999). As Mueller describes his role, he was “there to assist [Cameron’s] hand that was running this test separator” and Cameron’s hand was Juan Valadez. Cameron’s “flowback” operations supervisor, Mike Amigh, described Valadez as the lead man and Mueller as a “helper.” As such, Amigh agreed Valadez had the right to control all of the details of the work Mueller was performing. However, Amigh stated while Valadez had the authority to instruct Mueller what to do, Valadez did not instruct Mueller how to do it.

According to Valadez, he was responsible for everyone working at the Blue Marlin. Valadez, however, also testified Mueller was “his own independent contractor. He’s his own boss.... He’s not an actual employee. He’s his own employee. He’s his own boss.” As Valadez described, because Mueller already “[knew] the job tasks,” Valadez did not need to give Mueller additional training or detailed instructions. Valadez only provided Mueller with general instructions, such as, “[h]ey, dump the sand traps” and “[c]heck the plug catcher with me.”

Mueller’s deposition testimony was less clear and conflicting. At one point in his testimony, Mueller stated Valadez was his point of contact and supervisor: Valadez “told me what I was going to do.” Mueller stated he was working for Cameron and was under Cameron’s control. However, in response to another question, Mueller stated Valadez did not have control over his activities, and that it was ConocoPhillips’ “company man” who told him what to do. For instance, if Mueller were to have been injured on the job, Mueller stated he would have reported his injury to ConocoPhillips’ company man because that is who he was working for and ConocoPhillips was “controlling” him.

The summary judgment record also contains a written job safety analysis that Cameron prepared for Mueller. Appellants contend “Mueller learned how to perform his work solely through on-the-job training that Cameron (and Boone) provided.” Mueller testified he was required to attend a Cameron specific training about a month before the job that covered issues ranging from aerial forklifts, to rigging and lifting procedures. Cameron required Mueller to complete a form titled, “Employee Info,” and Cameron also administered various written tests, assessing Mueller’s knowledge of the training provided. One form explicitly refers to Mueller as an “employee.”

b. Tools and equipment

Cameron provided the specialized equipment needed for well flow testing, while Mueller provided his own hand tools. Cameron supplied the separator, manifold, sand traps, flare stack, and other specialized equipment. Mueller, on the other hand, provided his own sledgehammer, pipe wrench, laptop to report test data, and phone to create an internet hotspot to email test data. It is important to emphasize that without the specialized equipment Cameron provided, Mueller would have been unable to perform the job for which he was hired; the entire operation could not have been performed without the specialized equipment used to separate the sand and fracking fluids from the well output.

c. Worker’s right to control progress

Mueller worked a specific shift set by Cameron, and Mueller therefore had no control over his own schedule. The progress of the work appears to have been dictated in part by the outflow of the well. Valadez assigned Mueller specific tasks to perform, which appears to have been time sensitive, such as obtaining the scheduled measurements of water, oil, and gas that ConocoPhillips required. Cameron set the time and dates Mueller was to work, provided Mueller with on-site lodging, and provided direct management over the day-to-day operations. Mueller was assigned to assist Valadez—Cameron’s lead on-site operator. Mueller reported to Valadez, who supervised and controlled his work.

d. Time for which the worker is employed

According to Mueller’s invoicing and Cameron’s documentation, Mueller worked four days on the job: June 5 through June 8. Mueller worked a 12-hour shift, starting generally at 6:00 a.m. running to 6:00 p.m. He shared the trailer Cameron provided with another worker who worked the corresponding 12-hour night shift.

The length of well testing varies by job, with some tests lasting forty days, and others as few as three days. This was not Mueller’s first job for Cameron. Mueller testified he did not work exclusively for Cameron; Boone provided Mueller work with companies other than Cameron.

e. Method of payment

Cameron did not pay Mueller directly. Rather, Boone paid Mueller a flat daily rate. Taxes were not withheld from his pay and he was sent a 1099 IRS form at the end of the year. Mueller and his wife established their own corporation, H&J Oilfield Consulting, Inc., (“H&J”). H&J submitted an invoice for each day’s work to Boone. Boone, in turn, billed Cameron, which billed ConocoPhillips.

When the record shows no dispute regarding the controlling facts and only one reasonable conclusion can be inferred, the question of whether one is an “employee” or an “independent contractor” is a question of law. Durbin v. Culberson County, 132 S.W.3d 650, 659 (Tex.App.—El Paso 2004, no pet.). We cannot conclude that only one reasonable conclusion can be inferred. Due to the sharply conflicting evidence and balancing of the Limestone factors, we conclude Appellants have raised a fact issue as to the right to control Mueller by Cameron.

3. Does Cameron’s control of Mueller establish vicarious liability?

Appellants also suggest they can establish vicarious liability through the level of control that Cameron exercised over Mueller even as an independent contractor. We take this to mean that even if the level of control is insufficient to make Mueller an employee, it may establish that their level of control of Mueller still exposes Cameron to liability under a Redinger type theory for the failure to act reasonably in exercising the control that it did. Redinger v. Living, Inc., 689 S.W.2d 415 (Tex 1985). The problem with this theory is that if Mueller is viewed only as a contractor—and not an employee—then no liability attaches to Cameron unless it controlled the specific activity from which the injury arose. Hoechst-Celanese Corp. v. Mendez, 967 S.W.2d 354, 357 (Tex. 1998)(requiring “nexus between an employee’s retained supervisory control and the condition or activity that caused the injury”)[Emphasis in orig.]; Sandridge Energy, Inc., 511 S.W.3d at 723 (affirming summary judgment because plaintiff presented no evidence that Sandridge actually dictated control any details of the transportation of the workers when the car accident occurred). From this record, there is no evidence Cameron in any way controlled the injury causing conduct at issue here. It provided no rules on driving, it did not regulate when workers should be on the road, nor even which town (and hence the route taken) if a worker went to town. We find Cameron is not liable under a Redinger type theory. Redinger, 689 S.W.2d at 418-419.

4. Was Mueller released from employment after his last shift?

The summary judgment record is also particularly conflicting on this question. Cameron contends Mueller was not an employee at the time of the collision. Cameron argues that certainly by shift’s end, Mueller was released, was no longer its employee and was free to return home. Although there was no guarantee of additional work, the evidence is conflicting as to whether Mueller was released from employment or was on standby for additional work at the time of the collision.

Mueller testified that at around 5:00 p.m. on June 8—the day of the accident—a company representative of ConocoPhillips told Mueller he was “released” from the job. Valadez confirmed this and testified he and Mueller were told they were “released” before the collision occurred. Based on the well test results, ConocoPhillips shut the well in, and consistent with this testimony, the invoiced billed to Cameron shows Mueller worked from June 5 to June 8, but not on June 9.

Mueller, however, contends after he was released for the day on June 8, he was informed of the possibility of ConocoPhillips having additional work for him, but the ConocoPhillips’ foreman would not know for certain until the following day. Mueller testified the ConocoPhillips’ representative told him to stay until morning when he would have confirmation. Appellants support this contention with the following evidence: ConocoPhillips was planning to “drillout” the Blue Marlin. Valadez was called back to the well on June 9 to help with placing coils. Valadez would need one additional well test hand to assist him with that job if the coils had arrived by that time. Cory Johnson, the other Boone worker on site, recalled that after he was informed of his release on June 8, he was asked to remain standby on site:

Q. Let’s get that clear. Tell-- Tell me about that conversation that you were being requested to stay while they figured out what was going on.

A. I feel like that was with a Cameron hand, maybe Juan Valadez. I feel like he was the one that may have said that, that they wanted to keep the same four guys out there that had been doing the job.

...

Q. All right. So going back to the night of June 8th, even when you were told that the task of the well testing-- Let me restate it. On June 8th, after you--you’re told that the well is shut in, was it your understanding that you were still going to be kept on-site and continuing to do work out there?

...

Q. Okay. So you expected to continue staying in that trailer and continuing to work June 9th and June 10th or whatever other time. Is that correct?

A. Yes.

Q. Okay. Until the collision occurred can you tell us whether or not you expected to continue working at this well site?

A. Yes. Before the-- The whole time, even after the collision, I thought that we would be back on this job. You know, that’s twelve hours away from my house, so they asked us to stay. I was told I would get standby and that in a few days that job would start back up. They just needed to make their mind up what they were going to do with that well.

Q. And who told you you would be paid standby?

A. Juan Valadez. [Objections omitted].

Cory Johnson indeed billed Boone for two days of standby—for June 9 and June 10. Cameron, however, later declined to pay those charges.

Juan Valadez’s testimony corroborates Cory Johnson’s recollection:

Q. ---Mr. Mueller were told by ConocoPhillips y’all were on standby, right?

A. Yes.

Q. And there was an expectation that compensation would be paid?

A. Starting the next day.

Q. For both of you?

A. Yes.

Q. And that you-all would be moving to some other job site?

A. For Conoco.

Q. And—and that was told to you by the lead man-company man out at the job site even before you left the job site on June 8th, correct?

A. Yes.

Q. And the same thing was told to Mr.—

A. No, it was told to me, I told them. [Objections omitted].

Accordingly, Valadez relayed to Mueller and Johnson, “Yeah, they’re going to pay standby. We’re all staying on location. We’re moving to the next well.” But according to Valadez, “everything went south” after the collision and the only reason the job did not continue was because of the accident.

Mueller also corroborated Valadez’s understanding and in his statement to the police. Mueller said he “went to buy groceries for the rest of the week” because the “company man asked that the Boone hands stay and not be sent home.” Mueller testified to telling the ConocoPhillips representative he would stay, but was going to go home if new work did not start quickly, because he was not “going to sit around for five days waiting to get paid.” Mueller’s view on the matter is best summarized by this statement:

I wasn’t asked to stay. I’m not going to drive all the way back to Burleson, so I wouldn’t have—I wasn’t planning leaving until that morning anyway, the next morning. So that—I could have left and they would have called somebody else in. The potential was there. I would have found out in the morning either I’m moving locations or I’m driving back to Burleson.

Accordingly, Mueller traveled to town for a meal and watched a soccer game before stopping at a Wal-Mart to re-stock—water, food, and other supplies to bring back to the wellsite—in case he was asked to stay for another job. While awaiting confirmation, Cameron asserts Mueller was not required to remain on wellsite and could have driven home or stayed at a hotel.

Based on the MSA and the right to control balancing under the Limestone factors, we recognize the evidence is sharply conflicting.1 Reviewing the evidence in the light most favorable to Appellants, we find more than a scintilla of evidence exists to create a fact issue. We find Appellants have raised a fact issue as to whether Mueller was Cameron’s employee at the time of the accident.

B. If an employee, was Mueller in the Course and Scope?

Cameron contends Mueller, having chosen to stay the night, driving to Pecos for the evening and buying groceries in case another job became available, constituted a personal errand and was outside the scope of his employment. In other words, Cameron argues, even if we conclude Mueller was in the course and scope of his employment by remaining at the wellsite the evening after his shift, or in cleaning up the trailer the next morning—as some evidence suggests he was obligated to do—or in awaiting confirmation of additional work, the collision occurred while he was driving to Pecos and away from the work premises during the commission of a personal errand, outside the scope of his employment.

For vicarious liability to attach, the subject person must both be an employee and within the course and scope of employment at the time of the underlying event. Painter, 561 S.W.3d at 138. Course and scope is determined objectively and turns on “whether the employee was performing the tasks generally assigned to him in furtherance of the employer’s business. That is, the employee must be acting with the employer’s authority and for the employer’s benefit.” Painter, 561 S.W.3d at 138-39.

The facts of Painter are instructive to the analysis at hand. In Painter, which also dealt with a remote drilling site, the employer, Amerimex, provided an off-site bunkhouse some thirty miles away from the site. Id. at 128. The contract between Amerimex and the leaseholder provided Amerimex would bill $50 per day for the driller to drive the crew from the bunkhouse to the well location. Id. While driving the crew from the site to the bunkhouse, a driller was involved in a collision resulting in multiple fatalities and injuries. Id. at 129. It was undisputed that the driller in Painter was an employee of Amerimex; the question was whether he was in the course and scope of employment while driving the crew to the bunkhouse after his shift ended. Id. The Texas Supreme Court confirmed application of the coming-and-going rule for assessing the vicarious liability of Amerimex. Id. at 137.

Under the coming-and-going rule, an “employee is generally not acting within the scope of his employment when traveling to and from work.” Id. at 138-39. However, an exception to that rule applies “when an employee has undertaken a special mission at the direction of his employer or is otherwise performing a service in furtherance of his employer’s business with the express or implied approval of his employer.” Id. at 136 [Internal quotes and brackets omitted].

For example, in Janak v. Texas Emp. Ins. Ass’n, the court found injuries arising from a traffic collision were within the course and scope of employment even though the drilling crew, while en route to a well site, took a diversion to obtain water and ice needed for the day’s labor. 381 S.W.2d 176, 181-82 (Tex. 1964). Moreover, in Chevron U.S.A., Inc. v. Lee, we found the same exception applicable when an employer required its employee to drive to a seminar on what would otherwise have been the employee’s day off. 847 S.W.2d 354, 355 (Tex.App.—El Paso 1993, no writ). Conversely, in Pilgrim v. Fortune Drilling Co., Inc., the Fifth Circuit, applying Texas law, concluded that a driller driving home after a 12-hour shift was not in the course and scope of employment. 653 F.2d 982, 987 (5th Cir. 1981). “[I]n the absence of some special benefit to the employer other than the mere making of the employee’s services available to the employer at his place of business[,] the rule in Texas is that an employee is not acting in the course and scope of his employment while traveling to and from work, and that the employer ordinarily cannot be held vicariously liable to one injured by the employee’s negligent operation of an automobile during these trips to and from work.” Id.

Here, Appellants do not suggest Mueller’s actions of going to town for dinner or watching a soccer game were assigned tasks. In fact, Appellants recognize employees are generally not acting within the scope of employment when traveling to and from work under the coming-and-going rule; see Painter, 561 S.W.3d at 138-39. Rather, Appellants rely on an exception to the transportation exclusion. Appellants contend Mueller’s actions of securing water and food for the crew constituted a service in furtherance of Cameron’s business—triggering the special mission exception. After all, Appellants note, workers need fluids and food during the workday, and we recognize the summary judgment record is conflicting as to whether Cameron provided the crew with either. Appellants further contend Cameron was aware workers drove to town to stock up on supplies.

Although driving to town to restock on water and supplies was not specifically contracted for, as was the case in Painter, here, the testimony is nonetheless conflicting as to whether it was implied and whether workers were instructed to travel to obtain necessary water and supplies. The Blue Marlin is located sixty-five miles—a 130-mile round trip—from civilization and contains no facilities for water—other than non-potable water—or food, and there is also no place for fuel. Appellants contend Cameron “paid workers a daily rate to make the three-hour round trip to acquire these necessities” and “were not only well aware that workers traveled to get food and water, [Cameron] also apparently instructed workers to do so.” Evidence in the record supports that Cameron advised laborers Pecos was the closest town for employees to obtain necessities and approved them to do so. Michael Amigh, a Cameron employee, testified to the following:

Q. So Pecos or Carlsbad would be recommended—be the one that Cameron would have workers go to, to get water and food to work out on these remote job sites, correct?

A. Correct.

Q. Okay. And either Pecos or Carlsbad was acceptable to Cameron?

A. Uh-huh. Yes sir. [Objection omitted].

Mueller invoiced Boone at a daily rate of $464, in addition to a vehicle allowance of $50 per day, a phone use fee of $12.50 per day, and $200 for a “travel in and travel out” fee. The vehicle allowance allowed Mueller to have his vehicle on site. Due to the hot conditions, workers ran their vehicles all day to have an air-conditioned place to sit between tasks. Boone, in turn, billed Cameron a flat $750 rate for Mueller’s services.2 As for the remoteness of the wellsite, a “travel in and travel out” allowance was paid to the workers for travel expenses.

Cameron seemingly paid “transportation, time, truck, and travel” expenses to Boone, who in turn, paid Mueller. Although the vehicle Mueller drove at the time of the collision was not a commercial vehicle and Mueller paid for his own gas and vehicle insurance, there is a $200 invoice from Boone to Cameron corroborating travel expenses were compensated—at a fixed rate. Evidence in the record establishes workers ran their trucks all day, and there was no place to refuel anywhere near the Blue Marlin; moreover, workers were compensated for fuel. The Lopez court determined the company’s business “called for employing specialized, non-local work crews in constantly changing, remote locations on temporary assignments,” and provided a company vehicle to Lopez, for which the company paid fuel. Seabright. Ins. Co. v. Lopez, 465 S.W.3d 637, 644 (Tex. 2015)[Emphasis added]. Here too, Cameron’s business called for the frequent replenishment of not only water and food, but fuel too, and workers were compensated for fuel expenses. Lopez, 465 S.W.3d at 644.

Thus, due to the fact that workers ran their trucks throughout their 12-hour shifts and were compensated for fuel, we find fueling the workers’ vehicles was a necessity in furtherance of Cameron’s business. As such, the summary judgment evidence creates a fact issue as to whether the $50 allowance and/or the travel in and travel out allowance encompassed travel for necessary supplies. Appellants also contend Valadez—Cameron’s manager—specifically told Mueller to travel to Pecos for water and food. Cameron counters by arguing there is no evidence that Valadez, or anyone else at Cameron, instructed Mueller to do so.

We find the summary judgment record raises a fact issue as to whether Mueller was acting in the course and scope of his employment at the time of the underlying event. The evidence is specifically conflicting as to whether Cameron provided workers drinking water, whether Cameron instructed workers to travel to obtain said drinking water, or at the very least, whether Cameron was aware workers traveled to obtain drinking water. Mueller testified the reason he traveled to Pecos on the night of the collision was to re-stock his supply of water, food and ice. Surely, having access to drinking water during a 12-hour shift, in hundred-degree weather, at a remote worksite, was necessary and benefited Cameron by ensuring workers were physically able to perform—aside from the obvious fact of it being vital to retaining functioning workers.

The conflicting testimony, coupled with the basic notion that obtaining drinking water and food for the crew could very likely constitute a necessary service in furtherance of Cameron’s business, leads us to conclude a fact issue exists as to whether Mueller was within the course and scope of his employment at the time of the accident.

C. Affirmance of Unaddressed Grounds

Cameron obtained summary judgment on Appellants’ claims for: (1) gross negligence; (2) vicarious liability based on a principal-agent relationship; (3) borrowed servant; and (4) joint enterprise. To the extent we have not addressed Appellants’ arguments as noted above, these grounds were not challenged on appeal and they are accordingly affirmed. See Rangel v. Progressive County Mut. Ins. Co., 333 S.W.3d 265, 270 (Tex.App.—El Paso 2010, pet. denied) (affirming uncontested ground for summary judgment on appeal).

SUMMARY JUDGMENT AS TO BOONE

Boone presents similar arguments to those raised by Cameron. It contends the summary judgment on the claims against it can be upheld because Mueller: (1) was released from employment before the collision occurred; (2) was an independent contractor as evidenced by a contractual agreement and conduct of the parties; and (3) was not acting within the course and scope of his employment. We need not reach all these issues because the summary judgment record shows Mueller was not Boone’s employee.

A. Was Mueller Boone’s employee?

We begin with what the parties contractually agreed to. On behalf of H&J, Mueller signed an agreement with Boone titled, “David Boone Oilfield Consulting Independent Contractors Agreement.” In this agreement, the parties agreed “each Contractor is Independent, Separate, and apart from [Boone]” for taxes and workers compensation purposes. The parties further agreed, “[t]he contractor is required to furnish his own tools and transportation to the job site.” Pursuant to the agreement, Boone did not withhold taxes.

Generally, an agreement providing a person is an independent contractor with no right to control is determinative of the parties’ relationship. Love, 380 S.W.2d at 582; Farlow v. Harris Methodist Ft. Worth Hosp., 284 S.W.3d 903, 911 (Tex.App.—Fort Worth 2009, pet. denied); Durbin, 132 S.W.3d at 659. However, an exception applies when a contract is a “mere sham, subterfuge, or cloak designed to conceal the parties’ true relationship” Id. Appellants contend they created a fact issue on the sham/subterfuge claim through two arguments: (1) the contract lacks details about how the relationship would work, and (2) Cameron’s discovery responses state that Mueller was Boone’s employee.

Appellants posit the agreement “lacks critical details, including any aspects of the work to be performed by Mueller, the terms of the agreement, the location at which work is to be performed, type of work involved, tools or equipment, or the right of control.” Irrespective of the agreement, Appellants assert Boone represented Mueller as its employee through its conduct at the well, and via “discovery responses indicating that it was Cameron’s belief that Mueller was Boone’s employee.” According to Appellants, the resulting “discrepancy” between the agreement and Boone’s conduct creates a fact issue regarding Mueller’s employment status as to Boone. Boone responds the parties understood the agreement created an independent contractor relationship, emphasizing that Mueller himself testified he was an independent contractor. Boone also relies on Valadez’s and Cameron’s identification of Mueller as an independent contractor.

However, existence of a contractual agreement explicitly providing for an independent contractor relationship does not end the inquiry, as Boone would like us to conclude. If parties have entered into a written contract that expressly provides for an independent contract relationship and it does not vest in the principal or the employer the right to control the details of the work; then evidence must be produced, aside from the contract, to show that the in-fact operating agreement was one which vested the right of control in the alleged master. Love, 380 S.W.2d at 592. Under such circumstances, although the right to control remains the ultimate test, the actual exercise of control is evidentiary. Id. In Gulf Refining Co. v. Rogers, although there was a written contract explicitly providing for an independent contractor relationship, there was evidence the contract was a subterfuge, and the company actually exercised control not only as to the manner in which the work was to be performed, but as to who should be employed to do the work. 57 S.W.2d 183, 185-86 (Tex.Civ.App.—Waco 1933, writ dism’d). The Rogers court held a master servant relationship existed. Id. (“the mere fact that the contract as written was so drawn for the purpose of creating the relation of independent contractor would not relieve the company of liability for the negligence of such servants” if such contract was a subterfuge, or if actual control over the means and methods by which the work was to be performed was exercised).

The parties’ arguments also direct us back to the Limestone test to distinguish an employee from an independent contractor. Limestone, 71 S.W.3d at 312 (courts look to: “(1) the independent nature of the worker’s business; (2) the worker’s obligation to furnish necessary tools, supplies, and materials to perform the job; (3) the worker’s right to control the progress of the work except about final results; (4) the time for which the worker is employed; and (5) the method of payment, whether by unit of time or by job.”). These elements are also consistent with the contractual designations in the parties’ agreement.

1. Independent nature of the worker’s business

The first Limestone factor requires analysis of how independently Mueller acted at the Blue Marlin. Mueller testified he was not Boone’s employee, but an independent contractor. He emphatically denied he worked for Boone, stating, “I didn’t go to work for David Boone. I go to work for EP, or I go to work for Cameron, or I go to work for XTO. I don’t go to work for David Boone.” Consistent with that relationship, Boone would ask Mueller if he was available for an upcoming project, and Mueller was free to accept or reject the job. Boone required the persons it placed pass a drug test, sign a contract, and carry a $1 million dollar automobile liability policy. Boone also provided worker’s compensation coverage in the event one of its placed workers was injured on the job.

Prior to commencing work at the Blue Marlin, Boone did not provide Mueller any type of training with respect to the work Mueller performed at the wellsite. Appellants contend Boone instructed Mueller when and where to work, designated the hours worked, and could remove Mueller from job sites at its discretion. Although there is conflicting evidence as to whether Mueller followed Cameron’s orders at the Blue Marlin or maintained broad discretion, Appellants cite no evidence proving Boone controlled Mueller. To the contrary, Boone did not have anyone present at the Blue Marlin telling Mueller what to do and had no work rules or regulations that we can discern from this record.

2. Tools and equipment

Cameron, not Boone, provided the specialized equipment needed for well flow testing, while Mueller provided his own hand tools on the job. Mueller purchased and provided his own sledgehammer, pipe wrench, laptop to report test data, and phone to create an internet hotspot to email test data.

3. Worker’s right to control progress

The progress of the work appears to have been dictated in part by the outflow of the well, and Mueller stated he followed specific tasks assigned to him by Cameron personnel. Cameron set the time and dates Mueller was to work, provided Mueller with on-site lodging, and direct management over the day-to-day operations; Boone denies having control over any of these matters and there is no evidence to support that it did. The lead on-site operator who gave orders and maintained overall responsibility at the Blue Marlin was Valadez—a Cameron employee. Although the testimony is conflicting as to whether Valadez controlled Mueller’s activities at the Blue Marlin—Mueller denies Valadez had control over him—there is no evidence Boone either had the right of such control or exercised such control. Appellants advance no evidence Boone held or exercised a right to control over the details of Mueller’s work.

4. Time for which the worker is employed

Mueller worked a total of four days on the Blue Marlin—from June 5 to June 8. Mueller worked for Boone from 2014 to 2016. When Mueller accepted the job, he did not know how long it would last.

5. Method of payment

Boone paid Mueller a flat daily rate through Mueller’s company, H&J, which submitted an invoice for each day’s work by Mueller to Boone. Boone, in turn, billed Cameron, which billed ConocoPhillips. Ultimately, Boone paid Mueller directly, and Mueller was sent a 1099 IRS form at the end of the year. Boone did not withhold taxes on the workers it placed. The testimony shows Boone did no little more than bring willing workers and employers together, and then handled the billing arrangements, taking its cut from the respective rates it negotiated.

Although some of these factors may not, alone, be enough to demonstrate a worker’s independent-contractor status, together they provide conclusive summary judgment evidence that Mueller was Boone’s independent contractor, and not its employee when the collision occurred. See Limestone, 71 S.W.3d at 312. The contractual agreement between Mueller and Boone does not in and of itself absolve the inquiry as to Mueller’s employment status. As the Court in Love stressed:

[E]xercise of control must be so persistent and the acquiescence therein so pronounced as to raise an inference that at the time of the act ... giving rise to liability, the parties by implied consent and acquiescence had agreed that the principal might have the right to control the details of the work. [Emphasis added].

Love, 380 S.W.2d at 592.

Here, we find such evidence of actual exercise of control by Boone lacking and, therefore, cannot overcome the express agreement between Boone and Mueller. We find no case, nor are we directed to any, that supports a finding that Boone is vicariously liable. The summary judgment evidence, coupled with balancing of the Limestone factors, is not so persistent or pronounced as to raise an inference at the time of the collision, the parties had an implied agreement Boone would control the details of Mueller’s work, of that in-fact Boone actually exercised such control.

Reviewing the evidence in the light most favorable to the non-movants, Appellants have not raised an issue of fact that leads reasonable and fair-minded individuals to differ in concluding Mueller was Boone’s independent contractor. At most, the evidence is weak and does no more than create a mere surmise or suspicion of material fact. Wade Oil & Gas, Inc., 417 S.W.3d at 540. Having concluded Mueller was not Boone’s employee, we do not reach whether he acted in the course and scope of his employment.

B. Affirmance of Unaddressed Grounds

Boone also moved for summary judgment on Appellants claims of (1) negligent entrustment; (2) negligent hiring, training, supervision, retention; (3) joint enterprise; and (4) negligence by David Boone in his individual capacity. Appellants have not challenged these granted grounds, and for that reason alone, we affirm.

DIRECT NEGLIGENCE CLAIM

As to both Boone and Cameron, Appellants urge us to create a duty for oil field companies to provide water and food to the workers on remote wellsites. The rationale for the duty would be to obviate the need for workers to be on the highways to replenish their own supplies.3 The summary judgment record includes evidence Highway 285—where the collision in this case occurred—was a “dangerous” road. Appellants cite to no authority recognizing this duty.

The existence of a duty is a question of law, balancing factors such as “the risk, foreseeability, and likelihood of injury against the social utility of the actor’s conduct, the magnitude of the burden of guarding against the injury, and the consequences of placing the burden on the defendant.” Adkins, 926 S.W.2d at 289-90. But particularly relevant here, transportation accidents have been a part of oil field work for decades. See e.g. Texas Emp. Ins. Ass’n v. Inge, 208 S.W.2d 867, 867 (Tex. 1948)(transportation collision involving oil field worker). Up until today, no court has recognized the duty Appellants seek to impose, nor has the Legislature felt compelled to intervene. It is not for an intermediate court of appeals to advance the law in such a profound way. See Durham v. Children’s Med. Ctr. of Dallas, 488 S.W.3d 485, 495 (Tex.App.—Dallas 2016, pet. denied)(declining to create new tolling doctrine for wrongful-death claims involving the death of a minor); Martin v. Clinical Pathology Labs., Inc., 343 S.W.3d 885, 892 (Tex.App.—Dallas 2011, pet. denied)(judicial exceptions to employment-at-will doctrine must be created by the supreme court); Burroughs v. APS Intern., Ltd., 93 S.W.3d 155, 161 (Tex.App.—Houston [14th Dist.] 2002 pet. denied)(“It is not for an intermediate appellate court to create new causes of action.”); Landmark Chevrolet Corp. v. Universal Underwriters Ins. Co., 121 S.W.3d 886, 890–91 (Tex.App.—Houston [1st Dist.] 2003, no pet.)(declining at court of appeals level to create exception to “eight corners rule”). We decline Appellant’s invitation to create this duty today.

CONCLUSION

We reverse the summary judgments granted to Cameron, affirm the grants of summary judgment as to Boone, and remand for further proceedings consistent with this opinion.

Footnotes

1

Additionally, the well records confirmed another job was to commence at another nearby well, but Cameron personnel did not arrive at that well until June 18, and those who arrived were all Cameron personnel—not contractors. The only standby fees actually charged to ConocoPhillips were for equipment—not personnel. On Cameron’s billing to ConocoPhillips, no employee time is billed for June 9, but it did bill six persons for June 8, which would run from midnight to midnight.

2

And as it turns out, Cameron billed ConocoPhillips $1,000 per day for those services.

3

There was conflicting evidence, however, as to whether ConocoPhillips provided water and Gatorade to contract employees.

Court of Appeals of Texas, El Paso.

TEXAS DEPARTMENT OF MOTOR VEHICLES, Appellant,

v.

GERALDINE BUSTILLOS, Appellee.

No. 08-18-00165-CV

|

January 25, 2021

Appeal from the 243rd District Court of El Paso County, Texas (TC# 2018DCV1204)

Before Rodriguez, C.J., Palafox, J., and McClure, C.J. (Senior Judge)

Rodriguez, C.J., concurring

McClure, C.J. (Senior Judge), sitting by assignment

OPINION

GINA M. PALAFOX, Justice

In this interlocutory appeal, Appellant Texas Department of Motor Vehicles (the DMV) challenges two related orders by the trial court, one denying the agency’s plea to the jurisdiction and the other sustaining objections asserted by Appellee Geraldine Bustillos to portions of the evidence attached to the plea. Bustillos filed suit against the DMV alleging that the agency retaliated against her for filing a workers’ compensation claim in violation of chapter 451 of the Texas Labor Code. See TEX. LAB. CODE ANN. §§ 451.001-.003. The DMV responded by filing a plea to the jurisdiction and, in the alternative, a motion for summary judgment, in which the agency asserted that the jurisdictional evidence of the case negated a prima facie case of retaliation and thus, Bustillos had failed to raise a genuine issue of material fact as to retaliatory intent, as required to survive a jurisdictional plea. We hold that the trial court erred in denying the DMV’s plea to the jurisdiction because Bustillos failed to raise a genuine issue of material fact on an essential element of her prima facie case of retaliation, or otherwise rebut the agency’s legitimate, non-retaliatory reason for terminating her employment. We reach this conclusion without need to consider the agency’s additional, stricken evidence.

Finding error, we reverse the trial court’s denial of the DMV’s plea to the jurisdiction and dismiss the retaliation claim based on lack of subject matter jurisdiction.

I. BACKGROUND

A. The facts1

As of 2010, James Chesshire managed the DMV’s El Paso Regional Service Center of the Vehicle Titles and Registration Division (the Service Center). The Service Center provided title and registration services to El Paso County and its surrounding area. Melissa Frescas worked as the office coordinator who trained all clerks and set their work schedules and assignments. Prior to this position, Frescas worked as a clerk herself. Frescas filled in for clerks and made calls to customers whenever the office operated short of staff or was busy. About six to seven clerks worked at the Service Center to include Geraldine Bustillos, who was hired in May 2013. All clerks were required to perform their duties in compliance with state and federal laws, rules, and regulations that pertain to the issuance of vehicle titles and registrations.

Clerks of the DMV provide customer service and process temporary registration permits for vehicles and trailers. For issuance of a permit, the process begins when a clerk is randomly assigned to a customer by means of an automated queuing system. The assigned clerk first enters the customer’s vehicle identification number (VIN) into a database known as the Registration and Title System (RTS). This database accesses all motor vehicle title-and-registration records maintained by the DMV.

As a second step, the clerk also enters the customer’s VIN into the National Motor Vehicle Title Information System (NMVTIS), an expanded database that includes history from other states and allows a clerk to determine whether a vehicle under review has ever been branded as “junk” or “salvage.” If a VIN is located in the NMVTIS, and it shows that it has not been branded as salvage or junk, the clerk then issues a permit. But if the vehicle has been declared as salvage or junk, the clerk is not allowed to issue a permit.

If no vehicle record is located within the NMVTIS, the clerk then uses a third system called “VINAssist.” VINAssist helps determine whether there is an error in the VIN provided by a customer. For example, if a single letter or digit in a VIN is not correct, VINAssist informs the clerk of the error, and the clerk is then able to enter a corrected VIN into the NMVTIS database. If VINAssist confirms that a VIN is in good form and no other record is located, the clerk can issue a permit.

As a clerk, Bustillos worked under the supervision of Frescas. From the start, Bustillos was regarded by the agency as a good employee; Chesshire viewed her as a very productive employee and a quick learner. The two performance evaluations Bustillos received for her annual review indicated that she exceeded DMV expectations.

Beginning in July 2015, however, several factors raised concerns for Chesshire that Bustillos may have been involved in illegal or inappropriate activity while performing her clerking duties. Chesshire and other employees noticed that Bustillos used her cash drawer in an atypical manner and frequently had trouble keeping the drawer in balance. Moreover, sometime in August or September 2015, both Chesshire and Frescas observed that certain customers frequently attempted to bypass the automated queuing system to transact their business solely with Bustillos. In particular, a customer by the name of Ricardo Sigala—a known, unlicensed dealer—would insist on being seen only by Bustillos. This type of activity violated rules of the Service Center.

Based on these concerns, Chesshire conducted a review, on October 6, 2015, of Bustillos’s past transactions involving Sigala and discovered that she had improperly issued six permits to him for salvage vehicles. Expanding his review, Chesshire sent a request, three days later, to the DMV’s IT division for a review of all permit transactions completed by Bustillos, and all other clerks at the Service Center, beginning January 1, 2015. Before completion of this review, however, an incident occurred on October 12, 2015, where Chesshire described that he believed he had caught Bustillos intentionally issuing a permit to Sigala for a salvage vehicle.

Bustillos, however, described the October 12 incident in a contradictory manner. Bustillos testified that Chesshire merely told her that she had entered Sigala’s VIN incorrectly by failing to use VINAssist. In response, she informed him that she did not have access to VINAssist. Although she routinely used RTS and NMVTIS to ensure that permits were not issued to junk and salvage vehicles, Bustillos claimed she was never trained to use VINAssist, and also claimed she did not know if anyone ever used it.2 Furthermore, Bustillos acknowledged that the queuing system was one way in which customers would get assistance from a clerk, but she stated that customers were also permitted to ask for a specific clerk. Bustillos would allow customers to seek her assistance in this way, and she stated at least two other clerks did the same. Following this incident on October 12, Chesshire informed Bustillos that she was under investigation and that the matter had been referred to management in Austin. According to Bustillos, Chesshire could not provide her with any proof of misconduct. And in her deposition, Bustillos testified that any improper issuance of permits would have been due to her lack of training. Nonetheless, Bustillos was reassigned to phone duty only at that time.

On November 4, 2015, Bustillos reported she had injured her back, shoulder, and neck while replacing a water jug in the breakroom. She immediately informed Chesshire about her injury, and even though Chesshire told her that they needed to fill out a report, she left work that same day. Bustillos returned to the office a few days later for part of the day, and she told Chesshire that she was going to make an appointment with a doctor. She testified in her deposition this appeared to bother Chesshire based upon his non-verbal demeanor, but she acknowledged that she did not know what his actual thoughts were. According to Bustillos, the only thing Chesshire told her was that she should do what she needed to do. Bustillos also acknowledged that, after informing Chesshire she was going to see a doctor, no one at the DMV ever made any negative comments about her injury or her plan to see a doctor. Bustillos eventually filed her workers’ compensation claim, and aside from going into work for that partial day, she never returned to work.

Meanwhile, Jeremiah Kuntz, director of the Vehicle Titles and Registration Division of the DMV, was informed about Bustillos’s suspected fraud at a quarterly meeting of regional managers in Austin. Internal investigations by both Chesshire and the internal audit division revealed that Bustillos had issued numerous permits for salvage and junk vehicles and for vehicles with fake VINs in violation of the DMV’s policies and state law. The DMV sent Bustillos official notice of possible disciplinary action on December 10, 2015. This notice detailed the policies she violated by allowing customers to bypass the queuing system in order to assist them personally and by intentionally issuing invalid permits—namely, nineteen permits to salvage vehicles, one permit to a junk vehicle, and an additional thirty-five permits to fake VINs. On December 11, 2015, Bustillos sent a written rebuttal by email. In her email, she responded that she did not intentionally issue bad permits, she had never been told to use VINAssist, and she did not receive a password to VINAssist until the beginning of December 2015. She also stated, “I believe all of the allegations against me were brought about due to my complaint about favoritism in the office. I feel that this is in retaliation for that complaint since the investigation into my daily work started shortly after.”3

After reviewing Bustillos’s response with Chesshire, Kuntz believed Bustillos’s actions were intentional due to “the sheer volume of improper transactions, especially with respect to certain dealers or repeat customers ....” Kuntz determined, in the alternative, that even if those improper transactions could be attributed to mere oversight or mistake, the errors “still would have been considered gross negligence of job duties or gross misconduct” meriting termination. Kuntz also concluded that Bustillos was an outlier because no other employee at the Service Center committed a similar number of errors in issuing permits to salvage or junk vehicles. Likewise, Frescas testified she was unaware of any other situations where a clerk at the Service Center issued temporary permits to salvage or junk vehicles, or where a customer sought out a particular clerk in order to obtain such a permit.

On December 15, 2015, a notice of disciplinary action was sent to Bustillos informing her of Kuntz’s independent decision to terminate her that same day. In his declaration attached to the DMV’s pleading, Kuntz stated that he made his decision after reviewing all the evidence and consulting with the DMV’s human resources division, civil rights division, and general counsel’s office. And although Kuntz admitted he knew Bustillos had filed a workers’ compensation claim when he decided to terminate her employment, he stated “without hesitation that this played no part whatsoever in [his] decision.” He added that he had a zero-tolerance policy for all fraud or other conduct that suggested an abuse of the public trust and noted, “for me to have not terminated Bustillos for her misconduct simply because she had filed a workers’ compensation claim after-the-fact, would have been to treat her differently than someone else who has never filed a claim.” Similarly, Chesshire stated in his declaration, “[m]y investigation, as well as my opinion that Bustillos’ actions were intentional and had violated TxDMV policy, did not play any role whatsoever in my treatment of Bustillos’ injury and workers’ compensation claim. At all times, I acted according to policy with respect to her workers’ compensation claim.”

B. The procedural history

Bustillos sued the DMV, alleging it violated both chapter 451 of the Texas Labor Code and the Family and Medical Leave Act (FMLA). The DMV removed the case to federal court and filed a motion for summary judgment on both claims. The United States District Court for the Western District of Texas dismissed Bustillos’s FMLA claim with prejudice and declined to exercise its supplemental jurisdiction to resolve the state-law retaliation claim. Instead, it dismissed that claim without prejudice, and Bustillos filed in state court the instant petition alleging the DMV committed an act of retaliation against her for filing a workers’ compensation claim in violation of chapter 451 of the Texas Labor Code.

The DMV responded by filing its “Plea to the Jurisdiction, and, in the Alternative, No-Evidence Motion for Summary Judgment.”4 In its plea,5 the DMV made the same arguments it now makes on appeal asserting that Bustillos could not rebut the DMV’s non-retaliatory reason for discharging her, and thus, there existed no genuine issue of material fact in support of her claim. The DMV attached twenty-two exhibits to its plea in support of its arguments.

Bustillos filed her response to the DMV’s plea and incorporated several of her own exhibits to be used “for all purposes[.]” Later, Bustillos filed her “Objections to and Motion to Strike Defendant’s Incompetent Evidence,” requesting exclusion of large portions of the DMV’s evidence. On the same day that the DMV filed a response to this first set of objections, Bustillos filed her “Supplemental Objections to and Motion to Strike Defendant’s Incompetent Evidence.” The supplemental set of objections challenged additional parts of the DMV’s evidence. The day after Bustillos filed her second set of objections, the trial court held a hearing on the DMV’s plea to the jurisdiction and Bustillos’s corresponding objections. After hearing argument from the parties, the trial court rendered two orders, one denying the DMV’s jurisdictional plea and the other sustaining both sets of Bustillos’s evidentiary objections. The DMV filed a timely notice of interlocutory appeal challenging both orders. See TEX. CIV. PRAC. & REM. CODE ANN. § 51.014(a)(8) (authorizing an interlocutory appeal when the trial court grants or denies a plea to the jurisdiction).

II. DISCUSSION

On appeal, the DMV raises two issues challenging the trial court’s rulings on its plea to the jurisdiction. First, it challenges the sufficiency of the evidence establishing a prima facie case of retaliation, and of any evidence rebutting the agency’s legitimate, non-retaliatory grounds for terminating Bustillos’s employment. In the absence of a prima facie case, the DMV asserts that Bustillos cannot establish subject matter jurisdiction of the trial court over her claim of a violation of section 451.001 of the Texas Labor Code. Second, as a supplemental issue, the DMV argues the trial court erred in sustaining objections and excluding from consideration the additional evidence that the DMV attached to its jurisdictional pleading, which it argues would conclusively negate Bustillos’s claim. For the reasons explained below, we need only address the DMV’s first challenge.

A. Standard of review

In Texas, sovereign immunity deprives a trial court of subject matter jurisdiction for lawsuits in which the state or certain governmental units have been sued, unless the state consents to suit. See Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 224 (Tex. 2004); Hosner v. DeYoung, 1 Tex. 764, 769 (1847). Subject matter jurisdiction is essential to a court’s power to decide a case. Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 443 (Tex. 1993). The absence of subject matter jurisdiction may be raised by a plea to the jurisdiction, Texas Dep’t of Transportation v. Jones, 8 S.W.3d 636, 637 (Tex. 1999) (per curiam), or by other procedural vehicles such as a motion for summary judgment. See, e.g., NME Hosps., Inc. v. Rennels, 994 S.W.2d 142, 144 (Tex. 1999). Accordingly, an agency of the state may properly assert immunity from suit by means of a plea to the jurisdiction. Rusk State Hosp. v. Black, 392 S.W.3d 88, 93 (Tex. 2012); see also TEX. TRANSP. CODE ANN. § 1001.002 (recognizing the DMV as an agency of the state).

We review a trial court’s ruling on a plea to the jurisdiction de novo. Miranda, 133 S.W.3d at 228. In a plea to the jurisdiction, a party may challenge either the pleadings or the existence of jurisdictional facts, or both. Id. at 226–27. When a defendant challenges the plaintiff’s pleadings, our determination turns on whether the pleader has alleged facts sufficient to demonstrate the court’s subject matter jurisdiction. Id. at 226. However, if a plea challenges the existence of jurisdictional facts, we consider relevant evidence submitted by the parties to resolve the jurisdictional issues raised. Id. at 227 (citing Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 555 (Tex. 2000) (confining the evidentiary review to evidence relevant to the jurisdictional issue)). In cases in which the jurisdictional challenge implicates the merits of the plaintiff’s cause of action and the plea includes evidence, the court necessarily reviews the relevant evidence to determine if a fact issue exists. Miranda, 133 S.W.3d at 227. In such cases, “this standard generally mirrors that of a summary judgment under Texas Rule of Civil Procedure 166a(c).” Id. at 228.

Under this standard, “if the plaintiffs’ factual allegations are challenged with supporting evidence necessary to consideration of the plea to the jurisdiction, to avoid dismissal plaintiffs must raise at least a genuine issue of material fact to overcome the challenge to the trial court’s subject matter jurisdiction.” Id. at 221. By requiring the state to meet the summary judgment standard of proof, a plaintiff is protected from having to put on her case simply to establish the court’s jurisdiction. Id. at 228 (citing Bland, 34 S.W.3d at 554). Rather, “after the state asserts and supports with evidence that the trial court lacks subject matter jurisdiction, we simply require the plaintiffs, when the facts underlying the merits and subject matter jurisdiction are intertwined, to show that there is a disputed material fact regarding the jurisdictional issue.” Id. In determining whether a material fact issue exists, we must take as true all evidence favorable to the plaintiff, to include indulging every reasonable inference and resolving any doubts in favor of the plaintiff. Id. In doing so, however, we cannot disregard evidence necessary to show context, and we cannot disregard evidence and inferences unfavorable to the plaintiff if reasonable jurors could not. Alamo Heights, 544 S.W.3d at 771 (citing City of Keller v. Wilson, 168 S.W.3d 802, 811–12, 822–23, 827 (Tex. 2005)).

In our review of the trial court’s ruling, we consider the evidence attached to the motions and responses of both parties. Cf. Schlumberger Tech. Corp. v. Pasko, 544 S.W.3d 830, 835 (Tex. 2018) (per curiam) (holding that the defendant was entitled to rely on the plaintiff’s evidence submitted against its summary judgment motion and noting that Rule 166a(c) of the Texas Rules of Civil Procedure allows a court to consider evidence in the record that is attached to either the motion or a response); Wilson v. Burford, 904 S.W.2d 628, 629 (Tex. 1995) (per curiam) (holding that a deposition transcript referred to in plaintiffs’ response to defendants’ motion for summary judgment was, by the plain language of Rule 166a(c), proper summary judgment evidence on which both the movant and the respondent could rely).

B. Preservation of error

As a preliminary matter, before reaching the merits of the first issue presented, we address Bustillos’s claim that the DMV failed to preserve purported trial court error by incorrectly articulating the grounds or legal standard for a ruling on a plea to the jurisdiction. Relying on Miranda, she contends that the DMV neglected to preserve error by failing to address its obligation to “first present evidence” conclusively negating one or more elements of the retaliation cause of action. See 133 S.W.3d at 226, 228. Because Bustillos herself misconstrues the jurisdictional standard, we disagree.

Based on our reading of Miranda and Garcia, we conclude that the DMV presented a proper plea to the jurisdiction that challenged the jurisdictional facts of Bustillos’s claim and, within the jurisdictional pleading, the DMV properly addressed the burden-shifting analysis required of the court’s review. Id. at 221; Mission Consol. Indep. Sch. Dist. v. Garcia, 372 S.W.3d 629, 635 (Tex. 2012). With evidence attached, the DMV’s plea to the jurisdiction challenged the court’s subject matter jurisdiction over the retaliation suit based on insufficient evidence to establish a waiver of the agency’s immunity from suit. As a preliminary matter, we decline to find that the DMV failed to adequately apprise the court below of its jurisdictional argument such that it wholly waived its complaint for review. See TEX. R. APP. P. 33.1(a)(1)(A) (requiring only that a party’s request, objection, or motion state the grounds for the ruling sought with sufficient specificity to make the trial court aware of the complaint). And even still, as further pointed out by the DMV in its reply, it is well settled that subject matter jurisdiction can be raised for the first time on appeal. See Rusk State Hosp., 392 S.W.3d at 94–95; Legarreta v. FIA Card Servs., 412 S.W.3d 121, 124 (Tex. App.—El Paso 2013, no pet.). Consequently, an appellate court must consider challenges to the trial court’s subject matter jurisdiction on interlocutory appeal, regardless of whether such challenges were presented to or determined by the trial court. See Waco Indep. Sch. Dist. v. Gibson, 22 S.W.3d 849, 850–51 (Tex. 2000).

We therefore reject Bustillos’s initial contention that the DMV failed to preserve purported trial court error by the form of its plea.

C. The DMV’s plea to the jurisdiction

In its first issue, the DMV argues Bustillos failed to present sufficient evidence of a prima facie claim of retaliation and failed to present any evidence negating the legitimate, non-discriminatory reason for her termination, which it asserts she must do to establish the court’s subject matter jurisdiction over the retaliation claim. The DMV contends that Bustillos had the initial burden to demonstrate a causal link between the filing of her workers’ compensation claim and her discharge. Yet, to this assertion, Bustillos argues that her obligation to submit evidence responding to the DMV’s plea to the jurisdiction did not arise until the DMV first presented evidence conclusively negating one or more elements of her claim. And, even still, Bustillos contends she “made an evidentiary showing to the trial court of an existing genuine issue of material fact that her termination was caused, in part, by her making a workers’ compensation injury report or claim ....”

Given the parties’ initial disagreement over the proper standard of review, we begin our discussion by setting out the analytical framework for resolving the DMV’s jurisdictional claim, which asserts there is no waiver of immunity applicable to Bustillos’s retaliation claim brought under the Texas Workers’ Compensation Act (TWCA). See TEX. LAB. CODE ANN. § 451.001.

1. Analytical framework for workers’ compensation retaliation claims asserted against a governmental employer

Section 451.001 of the Labor Code prohibits “[a] person” from discharging or in any other manner discriminating against an employee because that employee filed a workers’ compensation claim in good faith. See TEX. LAB. CODE ANN. § 451.001. As relevant here, the Supreme Court of Texas previously considered whether a chapter 451 cause of action would apply against a state agency employer as it otherwise applied against a private employer. Kerrville State Hosp. v. Fernandez, 28 S.W.3d 1, 2 (Tex. 2000). To answer the inquiry, Fernandez first acknowledged that the doctrine of sovereign immunity protects the State of Texas, and its agencies, from lawsuits for damages, unless waived by legislative consent. Id. at 3 (citing Fed. Sign v. Tex. S. Univ., 951 S.W.2d 401, 405 (Tex. 1997), superseded by statute on other grounds as stated in Miranda, 133 S.W.3d at 224). Moreover, Fernandez observed that “[t]he courts of our state require clear and unambiguous legislative expression before they will hold that sovereign immunity has been waived.” Id.

After construing the Anti-Retaliation Law, Fernandez concluded that a waiver of immunity was provided, not by the Act itself, but rather by the State Applications Act (SAA) found in chapter 501 of the Labor Code. Id. at 4. Fernandez noted that the SAA expressly adopted the Anti-Retaliation Law as one of its provisions. Id. (interpreting prior version of the SAA); TEX. LAB. CODE ANN. § 501.002(a). And, as Fernandez further described, the SAA is one of several statutes that require governmental entities to provide workers’ compensation insurance coverage to their employees. Id.; see TEX. LAB. CODE ANN. § 501.002(b) (providing that, for purposes of its own provisions and the provisions of the Anti-Retaliation Law, “the individual state agency shall be considered the employer”).

Notably, Fernandez held that the designation of state agencies as employers for purposes of the Anti-Retaliation Law reflected a clear and unambiguous waiver of their sovereign immunity. 28 S.W.3d at 9. The Court observed:

[S]ection 15(b) of the SAA makes no sense unless the Legislature has waived immunity. Why would the Legislature designate an individual state agency as the employer for purposes of a law creating a cause of action if the agency cannot be sued for that cause of action? Similarly, section 15(b) contemplates that the individual agency must be a party to an anti-retaliation suit. We have previously held that making a state entity a necessary party evidences intent to waive immunity. We therefore conclude that there is no other sensible construction of section 15(b).

Id. at 6–7 (citation omitted). Based on this provision, the Court thus determined that the Legislature intended to waive state agencies’ immunity under the Anti-Retaliation Law. Id. at 2. Fernandez further cautioned, however, that the SAA expressly limited the recovery of an Anti-Retaliation claim to the damages available under the Tort Claims Act. Id. at 10; see § 501.002(d) (providing that “[n]either this chapter nor Subtitle A authorizes a cause of action or damages against the state, a state agency, or an employee of the state beyond the actions and damages authorized by Chapter 101, Civil Practice and Remedies Code”).

Although Fernandez construed a prior version of the SAA, we note its current iteration continues to adopt chapter 451 such that it designates state agencies as employers for purposes of the statute, and it authorizes a workers’ compensation retaliation cause of action for damages to the extent of damages authorized by the Tort Claims Act. See TEX. LAB. CODE ANN. § 501.002(a)(10), (b), (d). Moreover, when we most recently construed the current version of the Act, we concluded that Fernandez remained as binding precedent notwithstanding the Legislature’s subsequent adoption of Section 311.034 of the Texas Government Code. Tex. Dep’t of Family & Protective Servs. v. Parra, 347 S.W.3d 362, 365–66 (Tex. App.—El Paso 2011, pet. denied); see also Tex. Dep’t of Aging & Disability Servs. v. Beltran, 350 S.W.3d 410, 416 (Tex. App.—El Paso 2011, pet. denied); TEX. GOV’T CODE ANN. § 311.034 (providing that “a statute shall not be construed as a waiver of sovereign immunity unless the waiver is effected by clear and unambiguous language”).

Even though Fernandez construed the SAA as providing a waiver of immunity for retaliation claims, no issue was further raised challenging the jurisdictional evidence. In that sense, then, the issue presented here by the DMV’s plea to the jurisdiction moves the analytical inquiry a step forward beyond Fernandez. By their briefing, the parties jointly assert, and we agree, that analogous authorities apply such that a waiver exists but only when the plaintiff states a claim for conduct that actually violates the provisions of the statute. Cf. State v. Lueck, 290 S.W.3d 876, 881 (Tex. 2009) (construing the jurisdictional requirements of the Texas Whistleblower Act, TEX. GOV’T CODE ANN. § 554.0035); Garcia, 372 S.W.3d at 646 (considering whether a plaintiff’s failure to allege a prima facie case of age discrimination, pursuant to Texas Labor Code section 21.051, deprived the trial court of jurisdiction over the claim). For example, when construing the immunity provision of the Whistleblower Act, the Supreme Court of Texas concluded in Lueck that jurisdictional requirements necessarily followed from statutory language requiring a violation of the act for there to be a waiver from suit. Lueck, 290 S.W.3d at 881 (citing TEX. GOV’T CODE ANN. § 554.0035). The immunity provision of that act provided as follows:

A public employee who alleges a violation of this chapter may sue the employing state or local governmental entity for the relief provided by this chapter. Sovereign immunity is waived and abolished to the extent of liability for the relief allowed under this chapter for a violation of this chapter.

Id.

Construing this language, the high court identified two jurisdictional requirements: the plaintiff must (1) be a public employee and (2) allege a violation of the statute. Id. (citing TEX. GOV’T CODE ANN. § 554.0035). Focusing on the second requirement—that is, requiring an allegation of a statutory violation—Lueck held it necessarily followed from the statutory language that the elements of the claim must be considered in order to ascertain what constituted a violation and whether that statutory violation had actually been alleged. Id. Based on this reasoning, Lueck concluded that the elements of a statutory claim pursuant to the Whistleblower Act could be considered as jurisdictional facts. Id.

Guided by Lueck, the Supreme Court then followed this reasoning in Garcia, which involved a retaliation case brought under the Texas Commission on Human Rights Act (TCHRA). Garcia, 372 S.W.3d at 637. Among other claims, the Garcia plaintiff filed suit alleging she was terminated in retaliation for her participation in protected activities. Id. at 632–33 (citing TEX. LAB. CODE ANN. § 21.051). After construing the TCHRA, Garcia concluded it similarly waived immunity from suit but only when the plaintiff actually stated a claim for conduct that would violate the act. Id. at 637. Here, guided by Lueck and Garcia, we conclude that the Legislature waived state agencies’ immunity for claims brought under the TWCA for workers’ compensation retaliation, but the immunity is waived only when the plaintiff states a claim for conduct that actually violates the statute. Cf. Lueck, 290 S.W.3d at 881; Garcia, 372 S.W.3d at 646.

In relevant part, section 451.001 protects an employee from retaliatory discharge for filing a workers’ compensation claim in good faith. See TEX. LAB. CODE ANN. § 451.001(1). “An employer who violates this statute is subject to a retaliation claim, which constitutes an exception to the traditional doctrine of employment at will found in Texas law.” Kingsaire, Inc. v. Melendez, 477 S.W.3d 309, 312 (Tex. 2015) (quoting Cont’l Coffee Prods. Co. v. Cazarez, 937 S.W.2d 444, 453 (Tex. 1996) (internal quotation marks omitted)).

To prevail in a TWCA-retaliation action, the plaintiff has the burden of making a prima facie showing that she, in good faith, filed a workers’ compensation claim and that there is a causal link between her filing of the claim and her discharge or other act of discrimination by her employer. See TEX. LAB. CODE ANN. § 451.001(1); Cardenas v. Bilfinger TEPSCO, Inc., 527 S.W.3d 391, 399 (Tex. App.—Houston [1st Dist.] 2017, no pet.). To establish a causal link between her firing and her filing of a workers’ compensation claim, a plaintiff must demonstrate that “the employer’s action would not have occurred when it did ....” Melendez, 477 S.W.3d at 319; see also Cont’l Coffee, 937 S.W.2d at 450 (providing that the “would not have occurred when it did” standard of causation applies in an anti-retaliation case as it does in a whistleblower case). “While an employee is not required to show that the filing of the worker’s compensation claim was the sole cause of the alleged discriminatory behavior, she must establish that ‘but for’ the filing of the claim the termination would not have occurred when it did.” Hernandez v. Am. Tel. & Tel. Co., 198 S.W.3d 288, 291 (Tex. App.—El Paso 2006, no pet.).

In establishing a causal link between her discharge and her workers’ compensation claim, an employee may rely either on direct or circumstantial evidence. Melendez, 477 S.W.3d at 312; Hernandez, 198 S.W.3d at 291. Regarding circumstantial evidence, the Supreme Court has identified factors that—if proven by the employee—are considered evidence of such a causal link. Cont’l Coffee, 937 S.W.2d at 451. These factors, which are known as the Continental Coffee factors, are (1) knowledge of the compensation claim by those making the decision on termination; (2) expression of a negative attitude toward the employee’s injured condition; (3) failure to adhere to established company policies; (4) discriminatory treatment in comparison to similarly situated employees; and (5) evidence that the stated reason for the discharge was false. Id. An additional factor courts may consider is temporal proximity of the termination to the date of the injury or claim. Echostar Satellite L.L.C. v. Aguilar, 394 S.W.3d 276, 288 (Tex. App.—El Paso 2012, pet. denied). While no one factor is determinative and an employee is not required to produce evidence on all such factors, a retaliation plaintiff must produce “sufficient circumstantial evidence on a majority of these factors.” Armendariz v. Redcats USA, L.P., 390 S.W.3d 463, 469 (Tex. App.—El Paso 2012, no pet.). “This evidence is relevant for determining whether a causal link exists, both in examining whether the employee established a prima facie case and the ultimate issue of whether the employee proved a retaliatory motive for the adverse employment action.” Parker v. Valerus Compression Servs., LP, 365 S.W.3d 61, 67 (Tex. App.—Houston [1st Dist.] 2011, pet. denied).

Once the employee establishes a prima facie claim to include a causal link, the burden shifts to the employer to rebut the alleged discrimination by offering proof of a legitimate, non-discriminatory reason for its actions. Id. If the employer demonstrates a legitimate, non-discriminatory reason, then the burden shifts back “to the employee ‘to produce controverting evidence of a retaliatory motive’ in order to survive a motion for summary judgment.” Id. (quoting Green v. Lowe’s Home Ctrs., Inc., 199 S.W.3d 514, 519 (Tex. App.—Houston [1st Dist.] 2006, pet. denied)). “The employee must present evidence that the employer’s asserted reason for the discharge or other adverse employment action was pretextual or ‘challenge the employer’s summary judgment evidence as failing to prove as a matter of law that the reason given was a legitimate, nondiscriminatory reason.’ ” Id. at 67–68 (quoting Benners v. Blanks Color Imaging, Inc., 133 S.W.3d 364, 369 (Tex. App.—Dallas 2004, no pet.)). Summary judgment is proper if the employee fails to produce controverting evidence. Id. at 68.

2. Application to the DMV’s plea to the jurisdiction

With supporting evidence attached, the DMV filed a plea to the jurisdiction, and in the alternative, a no-evidence motion for summary judgment, asserting two principal arguments: (1) Bustillos could not establish a causal connection between her workers’ compensation claim and her termination, and (2) Bustillos failed to raise a genuine issue of material fact of pretext or retaliatory intent concerning the DMV’s purported reason for her termination, which is that she issued temporary permits for “junk” or “salvage” vehicles in violation of state law and DMV policy. See TEX. LAB. CODE ANN. § 451.001(1); Parker, 365 S.W.3d at 67. On appeal, the DMV argues Bustillos failed to present sufficient evidence of a prima facie claim of retaliation and failed to present any evidence negating the legitimate non-discriminatory reason for her termination. Bustillos responds that, when viewed in the light most favorable to her and indulging all reasonable inferences in her favor, the trial court correctly denied the DMV’s plea because she established there is a genuine issue of material fact that her termination was caused, at least in part, by her workers’ compensation injury report or claim. Though the DMV filed both a jurisdictional plea, which mirrors a traditional summary judgment motion, as more fully discussed above, and a no-evidence motion for summary judgment, we will not segregate our review to address the unique burdens associated with each procedural vehicle. Essentially, the DMV’s pleading combined both traditional and no-evidence grounds. In reviewing a hybrid motion in which both parties bring forward summary judgment evidence, the differing burdens are immaterial, and the ultimate issue is whether fact issues exist. See Buck v. Palmer, 381 S.W.3d 525, 527 & n.2 (Tex. 2012) (per curiam). Thus, in conducting our de novo review, we will review the full summary judgment record to determine whether fact issues exist, and in doing so, we initially only consider the evidence admitted by the trial court and not the excluded evidence.

a. Whether Bustillos established a prima facie case to create a presumption of retaliation

We begin with the first step of the analysis: the prima facie case. For this stage, the causal link required between the protected activity (i.e., the filing of a workers’ compensation claim) and the adverse employment action (i.e., termination) is not onerous and does not rise to the level of a “but for” standard. See Alamo Heights, 544 S.W.3d at 782. Instead, Bustillos can establish her prima facie case “merely by proving close timing between the protected activity and the adverse action.” Id. Here, we agree that Bustillos presented a prima facie link of closeness in time between the filing of her workers’ compensation claim and her termination. See id. The record evidence shows that Bustillos was injured on November 4, 2015, she filled out a report for her claim on November 9, 2015, and she was terminated on December 15, 2015. Because there was less than two months between Bustillos’s injury and her termination, we hold there is sufficient evidence for the first step in the analysis.

But a prima facie case does not establish the level of causation necessary to survive the jurisdictional challenge; it only shifts the burden of production to the employer to present a legitimate reason for the termination. See id. Thus, in this instance, the burden of production shifted to the DMV to present a legitimate reason for its termination of Bustillos’s employment.

b. Whether the DMV presented evidence of a legitimate, non-discriminatory reason for Bustillos’s termination

Because Bustillos met her prima facie burden by showing temporal proximity between her work-injury claim and her termination, the burden shifted to the DMV to present a legitimate, non-discriminatory reason for Bustillos’s termination. See id. (“If the employee can establish a prima facie case of discrimination, a rebuttable presumption of discrimination arises, which can alone sustain a discrimination claim. But the employer can defeat this presumption merely by producing evidence of a legitimate, nondiscriminatory reason for the disputed employment action.”) (emphasis added). The DMV asserts it discharged Bustillos from her employment due to her misconduct in issuing improper permits for vehicles or, said differently, for conduct that occurred prior to her filing of a workers’ compensation claim.

Regarding this step of the burden shifting framework, the Supreme Court of Texas recently acknowledged in an analogous claim of retaliation based on the TCHRA that an employer is not forbidden from addressing performance issues involving employees who have engaged in protected activity, including following through on known pre-existing issues and addressing existing issues that come to light only during a subsequent investigation. Alamo Heights, 544 S.W.3d at 791–92. Furthermore, an employee’s denials on such issues are insufficient to create a fact issue as to causation. Id. at 792. Rather, the critical issue is whether the employer’s perception of the problems—accurate or not—was the real reason for a termination decision. Id.

In this case, Chesshire’s review of Bustillos’s transactions, coupled with an internal investigation by the DMV, purportedly revealed that Bustillos issued numerous permits for salvage and junk vehicles and for vehicles with fake VINs. This revelation was corroborated by the undisputed observations from various DMV employees who saw Bustillos engage in suspicious activity when using her cash drawer and by the undisputed fact that Bustillos’s error rate far exceeded others such that it was an outlier among clerks of the Service Center. Armed with this evidence, Kuntz consulted with the human resources division, the civil rights division, and the general counsel’s office. Both Kuntz and Chesshire stated that Bustillos’s workers’ compensation claim played no part in the decision to terminate her, but rather, the decision was based solely on her violation of the DMV’s policies and her abuse of the public trust entrusted to her position. In particular, Kuntz noted that he had a zero-tolerance policy for all types of fraud and for him to not have fired Bustillos in light of the evidence presented would have been to treat her differently than any other employee.

In light of this evidence supporting the DMV’s assertion that it terminated Bustillos for the non-discriminatory reason that she had improperly issued numerous permits prior to her workers’ compensation claim (a pre-existing issue addressed only after an investigation was completed), we hold that the DMV presented evidence of a legitimate, non-discriminatory reason for Bustillos’s termination: her violation of state law and agency policy by issuing improper vehicle permits. See Harris Cty. Hosp. Dist. v. Parker, 484 S.W.3d 182, 199–200 (Tex. App.—Houston [14th Dist.] 2015, no pet.) (holding that the employer provided substantial evidence to show a nonretaliatory reason for an employee’s termination where, while the employee was on FMLA leave, the employer learned that the employee had opened an independent pharmacy in violation of the employer’s policies); Rodriguez v. City of Poteet, No. 04-13-00274-CV, 2014 WL 769286, at *5–6 (Tex. App.—San Antonio Feb. 26, 2014, no pet.) (mem. op.) (holding that the employer met its burden of proof in establishing a legitimate, non-discriminatory reason for terminating the employee where the summary judgment evidence showed that the employer terminated the employee for his violation of its policy prohibiting sexual harassment, as concluded by an investigation, and noting that the employer’s burden is one of production rather than persuasion). Because the DMV satisfied this production requirement, the burden shifted back to Bustillos for the third and final stage of the analysis.

c. Whether Bustillos met her burden to establish pretext and causation

The DMV’s showing of a non-discriminatory reason for its termination of Bustillos’s employment triggered her duty to illuminate a material fact issue as to whether the DMV’s stated reason for terminating her was merely a pretext for a real, retaliatory purpose. See Alamo Heights, 544 S.W.3d at 790. Bustillos relies on circumstantial evidence to raise a fact issue on whether a causal link existed between her workers’ compensation claim and her employment termination. See Parker, 365 S.W.3d at 67; Melendez, 477 S.W.3d at 312.

In her response to the DMV’s evidence bearing on its explanation for the grounds for termination, Bustillos points to her own deposition testimony asserting that Chesshire never presented her with evidence about his concerns about her performance and, in any event, any improper issuance of permits was due to her lack of training. Notwithstanding her testimony, an employee’s subjective belief that an employer’s reason for her termination was false cannot alone supply a basis for so finding. See Alamo Heights, 544 S.W.3d at 792; see also Hous. Auth. of City of El Paso v. Guerra, 963 S.W.2d 946, 950 (Tex. App.—El Paso 1998, pet. denied) (“An employee’s subjective belief alone is not enough to support the causal connection required for a workers’ compensation retaliation cause of action.”); Elgaghil v. Tarrant Cty. Junior Coll., 45 S.W.3d 133, 141 (Tex. App.—Fort Worth 2000, pet. denied) (“The only other evidence [the employee] offers to establish pretext is his own speculation that [the employer] lied about its reasons for refusing to promote him. However, an employee’s subjective belief that an employer has given a false reason for its employment decision is not competent summary judgment evidence.”).

And considering the specific reason she asserted for her proposition that the DMV’s allegations were wrong—that the DMV failed to train her—Bustillos still failed to contradict the DMV’s reason for terminating her. Instead, her proffered evidence suggests her employer’s termination decision was based on an incorrect conclusion about her actions, which is not the same as evidence that the DMV engaged in a retaliatory decision. See Alamo Heights, 544 S.W.3d at 791–92 (“The issue is whether the employer’s perception of the problems–accurate or not–was the real reason for termination.”); Chandler v. CSC Applied Techs., LLC, 376 S.W.3d 802, 818 (Tex. App.—Houston [1st Dist.] 2012, pet. denied) (“When an employer’s decision to terminate a claimant’s employment is based on the results of an investigation into whether the claimant violated workplace rules, ‘evidence that the employer’s investigation merely came to an incorrect conclusion does not establish a racial motivation behind an adverse employment decision. Management does not have to make proper decisions, only non-discriminatory ones.’ ”) (emphasis added); see also Lund v. Tex. Health & Human Servs. Comm’n, No. 04-17-00625-CV, 2019 WL 1049347, at *10 (Tex. App.—San Antonio Mar. 6, 2019, pet. denied) (mem. op.) (holding that the employer’s decision to terminate an employee was founded on uncontroverted proof of misconduct where: (1) the employee did not contest that she improperly accessed records in violation of the employer’s policy, and (2) the employee instead attempted to excuse her actions by claiming that, while she accessed records, she did not intend to violate policy). This absence of proof of retaliatory intent due to a workers’ compensation claim is especially evident where Bustillos’s own statements demonstrated she never harbored any belief that her termination was due to her filing of such claim. She stated, instead, “I believe all of the allegations against me were brought about due to my complaint about favoritism in the office. I feel that this is in retaliation for that complaint since the investigation into my daily work started shortly after.”

Furthermore, Kuntz noted that he also had a zero-tolerance policy for all types of fraud and to not have fired Bustillos in light of the evidence presented to him would have been to treat her differently than other employees. And we have held that a legitimate and non-discriminatory reason for termination can be an employer’s enforcement of a company policy. See Santillan v. Wal-Mart Stores, Inc., 203 S.W.3d 502, 506 (Tex. App.—El Paso 2006, pet. denied) (holding that the employer provided a legitimate non-discriminatory reason for termination and properly shifted the burden to the employee to produce evidence of a retaliatory motive where the employee did not provide necessary employment documents in a timely manner in violation of the employer’s policy and of federal law).

In the absence of Bustillos’s showing that the DMV’s reasons for termination were pretextual, we now turn to consider whether she otherwise met her burden of establishing a material issue of fact on the causation element—i.e., that she would not have been discharged “but for” the filing of her workers’ compensation claim—under the remaining Continental Coffee factors. 937 S.W.2d at 451. During this stage of the analysis, “but for” causation is “significantly more difficult to prove than prima facie causation.” Alamo Heights, 544 S.W.3d at 782.

i. Decision makers’ knowledge of workers’ compensation claim

Although it urges this factor alone is not indicative of any retaliatory conduct, the DMV concedes it knew Bustillos had a pending workers’ compensation claim at the time it terminated her employment. Consequently, this causation factor weighs in favor of Bustillos.

ii. Expression of a negative attitude toward the employee’s injury

In her own deposition, Bustillos expressly acknowledged that no one at the DMV ever communicated any negative attitude toward her injury. As some evidence of a negative attitude, Bustillos pointed to her own perception of a change in Chesshire’s attitude and demeanor once she told him that she was going to see a doctor for her injury. But her own subjective interpretation of Chesshire’s attitude is not probative of a negative attitude under this factor. Cont’l Coffee, 937 S.W.2d at 451–52 (holding that an employee’s “impression” that her employer wanted her back at work instead of at home receiving workers’ compensation was no more than the employee’s subjective belief or conclusion and did not raise a fact issue under this factor); Alamo Heights, 544 S.W.3d at 773 (holding that the employee’s subjective belief that her harasser looked at her in a “creepy” manner and was “hitting on her” could not raise a fact issue). Therefore, this factor weighs against Bustillos. See Armendariz, 390 S.W.3d at 469 (holding that this factor weighed against the employee where she testified that no one from her employer did or said anything to discourage her from reporting her injury or from filing a workers’ compensation claim).

iii. Employer’s failure to adhere to established company policies

Chesshire began the internal investigation into Bustillos’s alleged improper transactions and stated he had, at all times, acted according to policy with respect to her subsequent workers’ compensation claim. The DMV’s notice of possible disciplinary action described the specific ways in which Bustillos allegedly violated its policies and Texas laws. Before making the final decision on termination, Kuntz reviewed all the evidence presented to him, provided Bustillos an opportunity for rebuttal, and consulted with various legal and administrative divisions of the DMV. Furthermore, Kuntz noted he had a zero-tolerance policy for all types of fraud and abstaining from firing Bustillos in light of the evidence presented to him would have been to treat her differently than any other employee.

Bustillos urged in her written response to the notice of possible disciplinary action, and in her deposition, that any improper issuance of permits resulted from the DMV’s lack of proper training for her regarding use of VINAssist. She continues to argue here that this lack of training demonstrates the DMV engaged in an activity against policy—specifically, failing to train their employees—and that this factor therefore weighs in her favor. However, the dispositive issue for this factor is not whether an employer ever engaged in any activity against their own policies; rather, we must ask whether an employer terminated an employee against its own policies. See id. at 470–71 (assessing this factor through a determination of whether an employer’s decision to terminate was in accordance with policy); Lund, 2019 WL 1049347, at *9 (holding that the material question under this factor is whether the employer followed its policies, specifically, concerning termination of employment). Because the record indicates the DMV terminated Bustillos for fraudulent activity in violation of both its policies and state law, and because there is no contradicting evidence of that fact, this factor weighs against Bustillos. See Armendariz, 390 S.W.3d at 470–71 (holding that this factor weighed against the plaintiff where the record showed that the employee violated an unwritten attendance policy on which the employer relied in terminating the employee and where the employee presented no affirmative evidence contradicting the existence of the policy).

iv. Comparison to similarly situated employees

In briefing, Bustillos argues next that she established a genuine issue of material fact on another one of the Continental Coffee factors. She argues that a factual issue exists as to whether the agency treated her in a discriminatory manner as compared to Frescas regarding the discipline imposed upon her for her issuance of nineteen permits to salvage vehicles and thirty-five permits to phony VINS. Bustillos argues that she and Frescas were similarly situated in the sense that, because Bustillos worked under the direct supervision of Frescas, and had received training directly from her, that if questionable permits were issued by Bustillos then this happened “under Frescas’s watch.” Yet, she further notes there is an absence of summary judgment evidence that Frescas was also disciplined, as was Bustillos, for this deficiency.

However, employees are similarly situated only if their circumstances are comparable in all material respects, including similar standards, supervisors, and conduct. Alamo Heights, 544 S.W.3d at 791. Admittedly, Bustillos and Frescas shared the same supervisor—Chesshire—who managed the entire Service Center. But that is where their similarities begin and end. While Bustillos was a clerk with a job title of Customer Service Representative III, Frescas was the office coordinator. Bustillos was tasked with providing customer service and processing temporary registration permits for vehicles; Frescas oversaw the work schedules, assignments, and training for all clerks. Indeed, Bustillos acknowledged that Frescas was her supervisor and that she did not have the same job functions and duties as a clerk. Although there is evidence that Frescas would fill in for other clerks if the office was short-staffed or busy, there was no indication that the assigned duties of Frescas and Bustillos were the same in all material respects. See Tex. Dep’t of Family & Protective Servs. v. Parra, 503 S.W.3d 646, 672 (Tex. App.—El Paso 2016, pet. denied) (declining to hold that an employee who was a case worker was similarly situated to an investigator where, even though some testimony established that the two jobs were equally important, the employee did not fully show that their circumstances were comparable in all material respects).

Regardless, Bustillos would not be able to satisfy this factor for an even more fundamental reason. Simply, there is no evidence in the record of Frescas or any other similarly situated employee having sustained an injury who thereafter filed a workers’ compensation claim. See Armendariz, 390 S.W.3d at 469 (holding that this factor weighed against causation where the record lacked evidence showing: (1) any other injured employee; (2) any other employee who filed a workers’ compensation claim; (3) any other employee returning to work and continuing to work after the employee reported an injury and filed a workers’ compensation claim; or (4) any employee that the plaintiff believed was fired for filing a workers’ compensation claim). Therefore, Bustillos has not shown that she faced discriminatory treatment compared to any similarly situated employee, and this factor weighs against her.

v. Evidence that the stated reason for the discharge was false

As discussed, the DMV presented substantial evidence showing the reason for discharging Bustillos was due to her improper issuance of numerous permits for vehicles. This reason was documented in the DMV’s notice of possible disciplinary action and its ultimate notice of termination. To address this evidence in favor of the DMV, Bustillos once again points to her statements that she was inadequately trained. She argues that her inadequate training was the cause of any improper issuance of permits, and therefore, the DMV’s conclusions about her transactions was proven to be in error, thus allowing this Court to make an inference that those reasons for discharge were false. However, as noted earlier, evidence that an employer’s termination decision was based on an incorrect conclusion about an employee’s actions is not the same as evidence that the employer engaged in a discriminatory decision. See Alamo Heights, 544 S.W.3d at 791–92; Chandler, 376 S.W.3d at 818; Lund, 2019 WL 1049347, at *10. Therefore, even accepting Bustillos’s evidence regarding her lack of training as true, as we must, we are not persuaded by her use of this evidence to buttress an argument that the DMV terminated her employment based on a retaliatory motive.

Bustillos did claim in her written response to the notice of possible disciplinary action that she believed the allegations against her constituted retaliation by the DMV. But her subjective belief alone that the DMV’s reason for her termination was false cannot supply a basis for so finding. See Alamo Heights, 544 S.W.3d at 792; Elgaghil, 45 S.W.3d at 141; Guerra, 963 S.W.2d at 950. Perhaps more importantly, and in her own words, Bustillos did not even assert any belief that the retaliation was due to her filing of a workers’ compensation claim. Accordingly, we are constrained to find, and do so find, that this factor weighs against Bustillos as well.

Having evaluated the evidence admitted by the trial court bearing on each of the circumstantial evidence factors, we conclude that Bustillos failed to produce evidence on the majority of the Continental Coffee factors and has therefore failed in her ultimate burden of establishing a genuine issue of material fact on but-for causation. We hold the DMV’s plea to the jurisdiction should have been granted, and the trial court’s failure to do so was error.

Accordingly, we sustain the DMV’s first issue presented for review.

D. The trial court’s evidentiary rulings

We need not address the DMV’s second issue challenging the trial court’s order excluding the DMV’s additional evidence because we hold that, even without the excluded evidence, the trial court erred in denying the DMV’s plea to the jurisdiction.

III. CONCLUSION

We reverse the trial court’s order denying the DMV’s plea to the jurisdiction and render judgment dismissing Bustillos’s retaliation claim under chapter 451 of the Texas Labor Code.

Footnotes

1

Our recitation of facts below will be based only on the evidence that was admitted by the trial court according to its rulings. In addition, we set out the general facts underlying Bustillos’s claim viewing all evidence under the applicable standard of review. See Alamo Heights Ind. Sch. Dist. v. Clark, 544 S.W.3d 755, 771 (Tex. 2018) (instructing that review of a plea to the jurisdiction mirrors that of a summary judgment and requires a reviewing court to take as true all evidence favorable to the non-movant).

2

We note, however, Bustillos also claimed that Frescas directed her to Sandy Benson to “pull up” VinAssist for her. She described that Benson did so “no more than five times.”

3

Around September 17, 2015, Bustillos made a complaint to Chesshire about favoritism in the office regarding, among other things, Frescas socializing with another clerk.

4

As will be discussed in more detail infra, we will refer to this combined pleading as a plea to the jurisdiction because the DMV’s challenge in its no-evidence summary judgment mirrors its plea to the jurisdiction complaint that challenges the trial court’s jurisdiction to hear Bustillos’s claim.

5

In the trial court, the DMV asserted a plea to the jurisdiction and, as an alternative ground, a no-evidence motion for summary judgment. Although the trial court’s order denying the motion appears to reference both grounds, the parties’ briefing addresses only the plea to the jurisdiction. Consequently, we only address the plea to the jurisdiction and not the unbriefed no-evidence motion for summary judgment.

Court of Appeals of Texas, El Paso.

IN RE: RUDOLPH AUTOMOTIVE, LLC D/B/A RUDOLPH MAZDA and RUDOLPH CHEVROLET, LLC, Relators.

No. 08-18-00149-CV

|

December 30, 2020

AN ORIGINAL PROCEEDING IN MANDAMUS

Before Alley, C.J., Rodriguez, and Palafox, JJ.

Alley, C.J., dissenting

MAJORITY OPINION

GINA M. PALAFOX, Justice

This mandamus proceeding filed in a negligence suit pits the dignity of a jury’s verdict against the authority of a trial court to grant a new trial based on multiple grounds raised in post-verdict motions. Real party in interest Andrea Juarez, acting individually and in a representative capacity for her mother, Irma Vanessa Villegas,1 moved for a mistrial and a judgment notwithstanding the jury’s verdict based on: (1) the jury’s conflicting answers on liability and percentage of fault, (2) the jury’s award of zero and low dollar amounts for disfigurement and other line-item damages, and (3) the trial court’s rulings on admission of evidence and other matters.2 Similarly, but more narrowly, relators Rudolph Automotive LLC d/b/a Rudolph Mazda and Rudolph Chevrolet, LLC (collectively, Rudolph or “the dealership”) filed a motion to disregard the jury’s answer to the question on comparative responsibility asserting that the jury’s assignment of 10% fault to the dealership conflicted with its earlier no-liability finding on negligence.

The trial court ordered a new trial based on the following grounds: (1) the verdict included a fundamentally defective determination of comparative responsibility in which the jury assigned a percentage of responsibility that could not be reconciled or disregarded, and prevented the 100% total comparative responsibility required by law; (2) the determination of zero damages for several line items completely ignored undisputed facts, while other awards of damages fixed an amount that was neither authorized nor supported by the evidence, and was contrary to the great weight of the evidence; (3) that a defense expert witness intentionally injected unreliable double hearsay, non-responsive to the question asked, in an attempt to inject an improper inference before the jury, and even though the court admonished the witness and instructed the jury to try and eliminate the harm, it remained obvious to the court that the harm done could not be eliminated or removed; and 4) that the Painter v. Amerimex Drilling I, Ltd.,3decision from the Supreme Court of Texas, handed down on the same day as the verdict, altered a major legal assumption underpinning the trial. Given its order granting a new trial, the trial court further found that the motion for judgment notwithstanding the verdict and motion to disregard jury findings were rendered moot. Following these rulings, Rudolph filed this mandamus action asking this Court to direct the Honorable Patrick Garcia, Judge of the 384th District Court of El Paso County, to vacate his order granting a new trial, harmonize the verdict consistent with Rudolph’s interpretation of the jury’s verdict, render judgment on the harmonized verdict, and award costs and other appropriate relief.

Because we conclude that Rudolph has not established that the trial court clearly abused its discretion in ordering a new trial, we deny the petition for writ of mandamus.

BACKGROUND

Factual Background

At the end of 2013, the Rudolph car dealership scheduled its sales team to work long hours to include eleven-hour shifts. Employees worked Monday through Saturday from 9 a.m. to 8 p.m., with the business occasionally closing as late as 10 p.m. Relevant here, the sales team included manager Marcelo Flores, and salespersons, Irma Villegas and Christian Ruiz, among others.

On December 27, 2013, Flores sent Ruiz to go buy beer—paid for by Flores—for the employees to drink. That evening, the sales team, including Flores, Ruiz, and Villegas, drank the beer while on the dealership’s premises. After 8 p.m., Ruiz brought a beer to Flores who had been working at his desk on a sales report. A short time later, Flores went to the salesroom and ordered everyone who remained to leave for the day. Ruiz left the building and got into his truck to drive home. He had parked in the front sales area of the dealership lot. Close in time, Villegas also left the building and walked toward her car.

As Ruiz drove forward toward the exit of the lot, he struck Villegas with his vehicle. The impact caused Villegas to fall and strike her head on the ground; and, as a result, she sustained a severe traumatic brain injury which left her permanently paralyzed on her left side. Due to her medical treatment, a portion of her skull was necessarily removed which caused a facial deformity. As of trial, Villegas resided in a nursing home, while her daughter, Andrea Juarez, assumed responsibility for her care.4

After the incident occurred, police officers soon arrived after receiving a call at 8:40 p.m. During the ensuing investigation, an officer on scene administered a standard field sobriety test as Ruiz admitted he had consumed two beers that evening.5

Procedural Background

Juarez, individually and as guardian of Villegas, filed suit against the Rudolph defendants (the dealership and its employees) alleging that Ruiz had negligently struck Villegas with his vehicle, while on the premises and acting in furtherance of the business of selling vehicles, after he had consumed alcohol which was authorized and provided to him by Flores.6 Additionally, as alternative claims, plaintiffs alleged that Rudolph had control over safety of the dealership and its premises generally, and made little or no safety policies for the protection of plaintiff and other persons to prevent injury from recognized hazards on the premises. Villegas further alleged that Rudolph failed to provide a safe work place and failed to adequately train and supervise its employees. Lastly, as an independent claim, Villegas filed a claim of negligence against Ruiz.

Prior to trial and relevant to this mandamus, Villegas filed a motion for partial summary judgment asserting that the evidence established that both she and Ruiz were acting in the course and scope of employment at the time of her injury as a matter of law. Villegas described that the collision occurred “on Rudolph’s premises at a place intended by Rudolph for use by its employees to drive their vehicles and park, and in an area where employees performed services for Rudolph.” Villegas asserted that the long-standing access/premises doctrine applied such that Ruiz and Villegas were deemed as acting in the course of employment at the time of the incident regardless of whether they were “off the clock” when it occurred.

Responding to this motion, Rudolph asserted that Villegas had applied the wrong legal standard and misinformed the court on the correct analysis of course and scope of employment. Rudolph asserted it was “known and undisputed that Rudolph [is] a non-subscriber,” and as a consequence, “Texas common law governs this Court’s analysis of the course and scope issue.” Rudolph further asserted that Ruiz and Villegas were not acting in the course and scope of employment at the time of the incident as both were leaving the dealership after they had finished their work. In footnote one, Rudolph pointedly argued as follows:

Ruiz is the only relevant actor for the course and scope analysis when considering whether Rudolph is either vicariously liable or liable via respondeat superior. The question of whether Ms. Villegas was in the course and scope of employment is only relevant to whether Rudolph has access to certain common law defenses, including contributory negligence. If Ms. Villegas was in the course and scope of her employment at the time of the accident, then Rudolph may lose its ability to use certain common-law defenses.

Rudolph cited to Painter v. Amerimex Drilling I, Ltd., 511 S.W.3d 700, 701 (Tex. App.—El Paso 2015) (Painter I), rev’d, 561 S.W.3d 125 (Tex. 2018) (Painter II), a vicarious liability case from this Court which had been, by then, granted discretionary review by the Supreme Court of Texas but had not yet been finally resolved. After quoting from Painter I, Rudolph argued that the proof necessary to place an employee within the course and scope of employment in a vicarious liability case versus a workers’ compensation case differed and required a higher standard of proof. Arguing her claim fell under the Texas Workers’ Compensation Act, Villegas replied that there was “no reason to use a double standard to determine course and scope of employment in direct action (non-subscriber) cases and workers’ compensation cases, especially where the plaintiff was an employee injured by a fellow employee on the premises of the employer with the manager on duty ....” And more specifically addressing and distinguishing from Painter I, Villegas argued the case involved a different legal theory than hers given that the underlying collision which caused the injury had occurred miles away from the jobsite, not on the work premises.

Neither party points us to a ruling on Villegas’s motion for partial summary judgment. Yet, we can surmise from our record that the trial court remained unconvinced that the course and scope issue could be decided as a matter of law. Our record shows that once plaintiffs rested their case in chief, the trial court again considered the course and scope issue, but this time raised by Rudolph. By a motion for directed verdict, Rudolph argued that the evidence established that Ruiz had not been acting in the course and scope of his employment at the time of the occurrence as a matter of law. After the trial court denied a directed verdict, the issue of course and scope, relative to all three employees, Villegas, Ruiz, and Flores, was submitted to the jury as a fact question (Question 1), along with corresponding questions of negligence and comparative responsibility (Questions 2, 3, and 4).

Trial and the Jury’s Verdict

Following a nearly three-week trial, the jury ascribed negligence to Flores, Ruiz and Villegas, but none to Rudolph. On the question of course and scope, the jury found that manager Flores was acting in the course of his employment, but Villegas and Ruiz were not. The jury assigned percentages of fault as follows: Rudolph (10%), Flores (25%), Ruiz (35%), and Villegas (30%).

In total, the jury awarded roughly $4 million in damages to plaintiffs. At issue here, the jury found zero for past disfigurement yet determined $200,000 for future disfigurement; zero for Juarez’s provision of past household services to her mother, but $150,000 for such provision of future services; zero for past or future loss of parental consortium; and, lastly, $25,000 to Villegas for past and future pain and suffering and a like amount for past and future impairment.7

After the jury returned its verdict, they were discharged by the trial court without objection. That same day, the Supreme Court of Texas handed down its decision in Painter v. Amerimex Drilling I, Ltd., 561 S.W.3d 125, 139 (Tex. 2018) (Painter II), in which it reversed our judgment and remanded the case to the trial court for further proceedings. In Painter II, the Supreme Court found that genuine issues of material fact precluded summary judgment in favor of the employer on the issue of course and scope of employment. Id.

Post-Verdict Proceedings

Following the verdict and discharge of the jury, Rudolph filed a motion to disregard the jury’s finding to Question 4, in which the jury assigned 10% comparative fault to the dealership, and for entry of judgment on the remainder of the verdict. Because the jury answered that Rudolph was not negligent in Question 2, the dealership argued that the jury’s answer to Question 4 was immaterial. Rudolph asked the trial court to disregard the jury’s answer to Question 4, as to it only, and apart from that one change, to sign a judgment on the remaining jury findings. Villegas also asked for post-verdict relief by filing a motion for judgment notwithstanding the verdict and to enter judgment, as well as a motion for mistrial. In the motion for mistrial, Villegas and Juarez asserted eight grounds in support of the granting of a new trial.

The trial court granted the motion for mistrial, and in doing so, identified as meritorious some but not all grounds advanced by Villegas. This mandamus action followed.

DISCUSSION

Rudolph’s petition for mandamus review presents six issues with the first being an overarching issue questioning the validity of the new trial order. Five sub-issues then follow which challenge the four grounds articulated by the trial court in the new trial order. Overall, Rudolph generally contends that none of the grounds articulated by the trial court support the grant of a new trial either on their face or on their merits.

To begin, we first detail the standards required of mandamus review.

I.

A. General Mandamus Standard

To obtain a writ of mandamus, a relator must show two things: (1) a clear abuse of discretion by the trial court and (2) no adequate remedy by appeal. In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135-36 (Tex. 2004). The Supreme Court of Texas has recognized that there is no adequate appellate remedy when a trial court issues an erroneous order for new trial. In re Columbia Med. Ctr. of Las Colinas, 290 S.W.3d 204, 209-10 (Tex. 2009). As such, the second prong of the mandamus test is established in this instance. We focus our inquiry, then, on the first prong only, the question of whether the trial court clearly abused its discretion.

B. Mandamus Review of New Trial Orders: Columbia Medical Center, United Scaffolding, and In re Toyota

The use of mandamus to challenge new trial orders has been subject to much change in recent years. Historically, however, Texas trial judges wielded virtually unfettered discretion to order new trials. Cummins v. Paisan Const. Co., 682 S.W.2d 235, 236 (Tex. 1984) (trial court’s order setting aside a default judgment and granting a new trial is not reviewable on appeal); see also Johnson v. Fourth Court of Appeals, 700 S.W.2d 916, 918 (Tex. 1985) (“Trial courts have always had broad discretion in the granting of new trials.”). Indeed, prior to 2004, appellate courts could not review orders granting a motion for new trial rendered within the trial court’s plenary power period except in very limited circumstances. See Wilkins v. Methodist Health Care Sys., 160 S.W.3d 559, 563 (Tex. 2005) (citing Johnson, 700 S.W.2d at 918).

Notably, in 2009, the Supreme Court of Texas observed that the significance of protecting the right to a jury trial made the issuance of a new trial order an “exceptional” circumstance that justified mandamus review. Columbia Med. Ctr., 290 S.W.3d at 209. The Court recognized that certain harm resulted when a trial court’s new trial order failed to sufficiently articulate its reasoning. Id. The Columbia Court described that “even if an unfavorable verdict were reversed and rendered in Columbia’s favor, Columbia would have lost the benefit of a final judgment based on the first jury verdict without ever knowing why, and would have endured the time, trouble, and expense of the second trial. Under the circumstances, Columbia does not have an adequate appellate remedy.” Id. at 209-10.

Consequently, the Supreme Court imposed a new specificity requirement on new trial orders, stating that even while it was not “retreat[ing] from the position that trial courts have significant discretion in granting new trials,” trial judges could no longer simply state that they made the decision to grant a new trial “in the interest of justice.” Id. at 212-13. “[S]uch a vague explanation in setting aside a jury verdict[,]” the Court wrote, “does not enhance respect for the judiciary or the rule of law, detracts from transparency we strive to achieve in our legal system, and does not sufficiently respect the reasonable expectations of parties and the public when a lawsuit is tried to a jury.” Id. at 213. Instead, Columbia determined that trial judges were required to give an “understandable, reasonably specific explanation” in their new trial orders. Id.

Shortly thereafter, when deciding the case of In re United Scaffolding, Inc., 377 S.W.3d 685, 688 (Tex. 2012), the Supreme Court further addressed the information that would constitute an understandable, reasonably specific explanation. There, in addressing the level of detail needed for a facially valid order, the Supreme Court particularly noted that trial courts were not expected to meet the same standard as is imposed on appellate courts. Id. at 687-88 (describing the review standard imposed by Pool v. Ford Motor Co., 715 S.W.2d 629, 635 (Tex. 1986)). “Imposing a Pool-like standard on trial courts would weigh too heavily against trial courts’ discretion, since that standard would frequently be impossible for a trial court to meet.” Id. at 687. For it is recognized that an appellate court is able to (and must) go into detail as to its reasons for overturning a jury verdict because the appellate court has a court reporter’s record at its disposal, whereas trial courts largely “must rely on their own observations” about what happened at trial at the time they render their decisions. Id. at 688.

Given these distinctions, United Scaffolding concluded that trial courts are afforded considerable discretion in ordering new trials based on two justifications, one being jurisprudential and the other practical. Id. at 687. Regarding jury trials, the Supreme Court acknowledged that “trial judges actually attend[ed] the trial and are best suited to evaluate its deficiencies ....” Id. Consequently, it further explained that “most trial judges are understandably reluctant, after presiding over a full trial, to do it all over again.” Id. When considering how detailed a trial court’s new-trial order must be and what level of review to apply, reviewing courts are thus instructed to afford jury verdicts appropriate regard but also to respect trial courts’ significant discretion in the matter of granting a new trial. Id.

United Scaffolding clarified that the specificity standard could be met if the trial judge provided “a cogent and reasonably specific explanation of the reasoning that led the court to conclude that a new trial was warranted.” Id. at 688. To pass muster, the new trial order must demonstrate on its face that “the jury’s decision was set aside only after careful thought and for valid reasons.” Id. More specifically, United Scaffolding described that a trial court did not abuse its discretion if the stated reason for granting a new trial: (1) is a reason for which a new trial is legally appropriate (such as a well-defined legal standard or defect that probably resulted in an improper verdict); and (2) it is specific enough to indicate that the trial court did not simply parrot a pro forma template, but rather derived the articulated reasons from the particular facts and circumstances of the case at hand. Id. at 688-89.8

Moving beyond facial validity, the Supreme Court next addressed “whether an appellate court may, in an original proceeding, determine whether the reasonably specific and legally sound rationale is actually true.” In re Toyota Motor Sales, USA, Inc., 407 S.W.3d 746, 749 (Tex. 2013). Overturning decades of precedent and describing its decision as the next step in the logical progression set by Columbia and United Scaffolding, the In re Toyota Court determined that, “an appellate court may conduct a merits review of the bases for a new trial order after a trial court has set aside a jury verdict[,]” and that if “the record does not support the trial court’s rationale for ordering a new trial, the appellate court may grant mandamus relief.” Id.

Condensed down to core principles, the Columbia, United Scaffolding, and In re Toyota line of cases established a two-step analysis for deciding whether a trial court acted within the scope of its discretion in ordering a new trial. First, we determine whether the ground stated in the new trial order is specific enough to indicate that the trial court did not simply parrot a pro forma template, but rather derived the articulated reason from the particular facts and circumstances of the case at hand. Second, we then determine whether the reason articulated is one for which a new trial is legally appropriate (such as a well-defined legal standard or defect that probably resulted in an improper verdict). See United Scaffolding, 377 S.W.3d at 688-89; see also In re Toyota, 407 S.W.3d at 749. Under the first prong, our focus is “not on the length or detail of the reasons a trial court gives, but on how well those reasons serve the general purpose of assuring the parties that the jury’s decision was set aside only after careful thought and for valid reasons.” United Scaffolding, 377 S.W.3d at 688. When a trial court order facially complies with those requirements, the second prong then requires a review of the correctness of the trial court’s decision on its merits. In re Toyota, 407 S.W.3d at 758. If a trial court’s articulated reasons for granting a new trial are not supported by the underlying record, the new trial order cannot stand. Id.

II.

A. The Comparative Responsibility Answer as to Rudolph

In Issue Two, the first sub-issue, Rudolph asserts that the trial court abused its discretion by granting a new trial based on the jury’s answer to questions on negligence and comparative-responsibility. Rudolph asserts a series of arguments: (1) that the trial court’s reason is facially invalid, (2) that there is no irreconcilable conflict, as to Rudolph, between the jury’s findings of negligence and comparative-responsibility, (3) that the trial court was obligated to harmonize the jury verdict, and (4) even if the findings were irreconcilably conflicted, a new trial was improper because Villegas did not object on a timely basis.

Although we proceed out of order, we necessarily begin with the last argument raising an issue of error preservation.

1.

Even when reviewing error from the procedural posture of mandamus as opposed to direct review, we must address the threshold matter of preservation of error as errors not properly preserved cannot generally form the basis for a grant of new trial under the merits review of In re Toyota. 407 S.W.3d at 761-62 (reversing a new trial grant that was based in part on error that was not preserved); In re State, No. 14-18-01036-CV, 2018 WL 6722351, at *3-*4 (Tex.App.—Houston [14th Dist.] Dec. 21, 2018, orig. proceeding) (mem. op.) (failure to obtain a ruling on a motion in limine and failure to object when evidence was admitted waived both errors and prevented them from being used as a basis for a new trial grant); In re Waste Management of Tex., Inc., 392 S.W.3d 861, 870 n.13 (Tex.App.—Texarkana 2013, orig. proceeding) (preservation requirement applies in mandamus proceedings). That said, there are some instances in which a motion for new trial itself acts as a vehicle for preservation of error. The question here, then, is whether Villegas’s post-verdict motion could serve to preserve error sufficient to allow this Court to perform a merits review of the trial court’s grant of a new trial based on purportedly conflicting answers in the jury verdict.

Rule 295 of the Texas Rules of Civil Procedure provides that if a jury’s answers to questions in a purported verdict are in conflict, the trial court must instruct the jury of the nature of the problem, give the jury additional instructions as necessary, and allow the jury to deliberate further. TEX. R. CIV. P. 295. In light of this rule, we have previously held that if a party wants to preserve error with regard to a defective jury verdict, “[t]he trial court must be made aware of the conflict before the jury is discharged because, once the jury is discharged, a conflict in the jury’s answers cannot be reformed.” Rhey v. Redic, 408 S.W.3d 440, 464-65 (Tex.App.—El Paso 2013, no pet.) (internal citations and quotation marks omitted). Here, it is undisputed that after the jury rendered its verdict, but before it was discharged, the Villegas plaintiffs did not bring the issue to the trial court’s attention.

However, in Rhey, we were not asked to address nor did we face the issue of whether a post-discharge motion for new trial could also serve to preserve error. Thus, while Rhey confirmed that a motion to correct the verdict is one way of preserving error in a conflicting jury verdict, it did not preclude or otherwise address the possibility that there are other ways to preserve such error. To date, the Supreme Court of Texas has not definitively answered that question—indeed, the last time the issue arose, the Court splintered into three plurality positions, none of which garnered a majority. See USAA Texas Lloyds Company v. Menchaca, 545 S.W.3d 479, 517-19 (Tex. 2018).9 Absent guidance from our highest court, we find this to be an open question.

We turn, then, to Rule 33.1, the general standard for preservation of error set by the Texas Rules of Appellate Procedure. See TEX. R. APP. P. 33.1(a). To demonstrate preservation of a complaint for appellate review, Rule 33.1 requires the record to show:

(1) the complaint was made to the trial court by a timely request, objection, or motion that:

(A) stated the grounds for the ruling that the complaining party sought from the trial court with sufficient specificity to make the trial court aware of the complaint, unless the specific grounds were apparent from the context; and

(B) complied with the requirements of the Texas Rules of Evidence or the Texas Rules of Civil or Appellate Procedure; and

(2) the trial court:

(A) ruled on the request, objection, or motion, either expressly or implicitly; or

(B) refused to rule on the request, objection, or motion, and the complaining party objected to the refusal.

TEX. R. APP. P. 33.1(a).

Rule 33.1 governs the preservation of error unless another rule applies. Although Rule 295 of the Texas Rules of Civil Procedure governs the procedure for correcting a verdict, the rule itself does not address the issue of error preservation. As such, we may rely on Rule 33.1 of the Texas Rules of Appellate Procedure to determine if error was preserved. We hold that, in addition to a motion to correct the verdict under TEX. R. CIV. P. 295, a motion for new trial can also preserve a defect in a jury charge under TEX. R. APP. P. 33.1 because the post-trial motion brings the error to the trial court’s attention close enough in time to provide it an opportunity to correct the error by ordering a new trial before appellate proceedings begin. We agree with the four-justice plurality in Menchaca that “[g]enerally, a party should object to conflicting answers before the trial court dismisses the jury. The absence of such an objection, however, should not prohibit us [as an appellate court] from reaching the issue of irreconcilable conflicts in jury findings.” Menchaca, 545 S.W.3d at 526-28 (Green, J., plurality op.).

In the absence of a motion to correct the verdict or a post-verdict motion such as a motion for mistrial or new trial—which cites a purportedly conflicting verdict as a basis for seeking relief—Rhey would apply, and error would not be preserved. But given that Villegas filed post-verdict motions that identified the conflicting jury answers as a ground for relief, we conclude that this basis for granting a new trial was properly raised with the trial court and not waived.

2.

Rudolph next contends the new trial order is facially invalid in that it fails to state why the trial court could not harmonize and reapportion the percentages of fault as it was required to do.

As earlier stated, a trial judge has significant discretion in ordering new trials. Columbia Med. Ctr., 290 S.W.3d at 212. Such discretion, however, does not permit a trial judge to substitute his or her own views for that of the jury without a valid basis. Id. To be valid, the trial court’s reason must be understandable and reasonably specific. Id. at 213. It must serve the general purpose of assuring the parties that the jury’s decision was set aside only after careful thought and for valid reasons. United Scaffolding, 377 S.W.3d at 688. In other words, it must indicate that the trial court did not simply parrot a pro forma template but derived its reasons from the particular facts and circumstances of the case at hand. Id. at 689.

Regarding this ground, the new trial order states as follows:

The Court finds that the jury determination of comparative responsibility of Rudolph Mazda in Question 4 is error that cannot be reconciled nor disregarded, and prevents the 100% total comparative responsibility required by law. Without 100%, the comparative responsibility finding is fundamentally defective.

In post-verdict motions, both parties addressed the jury’s answer to Question 4. Although both sides agreed that the answer to Question 4 created a conflict with other answers, they advocated for directly opposite responses from the trial court. Considering the whole verdict, Villegas argued the answer to Question 4 was fatally irreconcilable and could not be disregarded. In Question 1 and 2, Villegas asserted that the jury concluded that Rudolph’s manager, Flores, was negligent in the course and scope of his employment and proximately caused the occurrence. Villegas further noted that the jury had been instructed that Rudolph acted by and through its employees, agents, and representatives. Yet, in the negligence questions, Question 2 and 3, the jury found no negligence as to Rudolph. Nonetheless, Question 4, on comparative responsibility, the jury attributed 10% fault to Rudolph, which amount was included in arriving at 100% responsibility. As to Rudolph, Villegas argued the jury’s answers to this series of questions was fatally irreconcilable and could not be voided.

Rudolph countered that the jury’s answer to Question 4 was immaterial given its findings of no liability in Questions 2. Rudolph asserted that the answer to Question 4, as to it, should simply be disregarded.

Here, we understand the trial court to say that the apportionment of 10% responsibility to Rudolph in Question 4 is irreconcilable with the jury’s other findings of no negligence as shown in Question 1 (course and scope), Question 2 (general negligence), and Question 3 (premises liability). The new trial order articulates that the court found that “Question 4 is error [in] that [it] cannot be reconciled nor disregarded” and “prevents the 100% total comparative responsibility required by law.” The basis given, which is supported by the record, provides an understandable and reasonably specific explanation for granting a new trial, particularly when it is considered in context with the parties’ post-verdict arguments. See Columbia Med. Ctr., 290 S.W.3d at 213.

Facial validity is established. We proceed to an analysis of the merits of this new trial ground.

3.

Having decided that the explanation is facially valid, we next review the new trial order on its merits as required by In re Toyota. Rudolph argues that the trial court could not have granted a new trial on the ground of conflicting jury answers because a no-negligence finding in one part of the verdict controls over a corresponding apportionment of liability in another, and the no-negligence finding renders the apportionment finding immaterial for purposes of entering judgment.

In discussing conflicting jury findings such as this one, this Court has previously validated the general principle advanced by Rudolph, holding that “a trial [c]ourt properly harmonizes any apparent conflict between a specific finding of no negligence as to a defendant in the liability issues and an apportionment of negligence in the subsequent comparative negligence” by “enter[ing] a judgment for the defendant, the rule being that the specific finding directed toward the liability aspect of the verdict controls over the general finding of comparative negligence.” See Garza v. Waco Scaffold & Shoring Co., 576 S.W.2d 442, 446 (Tex.App.—El Paso 1978, writ ref’d n.r.e.). Likewise, the proposition that there is no fatal conflict when “the jury finds a party is not negligent but then apportions to it a percentage of fault” because “[i]ssues establishing or negating liability control over the issue which apportions, rather than establishes negligence” is the law as understood by several of our sister courts. See Beltran v. Brookshire Grocery Co., 358 S.W.3d 263, 269-70 (Tex.App.—Dallas 2011, pet. denied) (surveying cases from the San Antonio, Houston [1st Dist.], Tyler, Corpus Christi, Waco, and Dallas courts of appeals holding that a no-negligence finding in a verdict renders a subsequent apportionment finding as to that party immaterial).

Having reviewed this mandamus record, however, we conclude that this case does not present a circumstance where the jury found Rudolph not liable and then assigned it a percentage of liability. If such were the case, then Garza would apply. Instead, the jury in this instance found that Rudolph employee Marcelo Flores was negligent (Question 1), while acting in the course and scope of his employment (Question 2), but that Rudolph itself was not negligent (Question 3), yet also finding that Flores was 25% responsible and Rudolph was 10% responsible (Question 4) for plaintiff’s injuries. By instruction number two, the jury was informed that “[a] corporation acts by and through its employees, agents and representatives.” These findings are conflicting and do not allow for neat harmonization. In fact, these findings, all of which deal in part with Rudolph’s negligence and its apportioned responsibility, cannot be reconciled particularly in light of the fact that the jury attributed negligence to Flores while he was acting in the course and scope of his employment as a Rudolph manager. Because these determinations cannot be harmonized, we conclude that Garza does not apply.

The findings are irreconcilable, and the trial court did not err by basing its decision to grant a new trial on this ground. We find that this ground is sufficient to support the grant of a new trial.

Accordingly, we overrule Issue Two.

B. The Course and Scope of Employment, the Exception to the Coming-and-Going Rule, and the Impact of Painter v. Amerimex

In Issue Three, the second sub-issue, Rudolph argues that the trial court abused its discretion in granting a new trial to reconsider whether Rudolph’s two employees, Villegas and Ruiz, were acting in the course and scope of employment as a matter of law based on the Supreme Court of Texas’s decision in Painter v. Amerimex (Painter II). By directly citing Painter II, the trial court essentially identified that Painter I, which operated as controlling authority in our district during the trial, impacted the trial court’s rulings on pretrial motions, the presentation of evidence during trial, and the charge given to the jury.

1.

Rudolph first contends that we need not reach the merits of the debate over Painter II’s impact because the new trial order is facially invalid in describing its reasoning. We disagree.

Recall that the portion of the trial court’s new trial order dealing with the effect of Painter reads as follows:

As an additional and independent basis for new trial, the Court finds that the Texas Supreme Court decision in Painter v. Ameri[m]ex rendered on April 213, 2018, [sic] the day of this Jury Verdict, was important law that affected the earlier decision s [sic] of this Court on motions filed by the parties, the evidence presented at trial and the charge given to the Jury. Based on the Painter opinion and other relevant decisions and authority as set forth in Plaintiff’s Motion for Judgment NOV, it appears to this Court that it needs to reconsider whether Irma Vanessa Villegas and Christian Ruiz were injured in the course of employment as a matter of law which would make Plaintiff’s claim a non-subscriber negligence case under 406.[0]33 of the Texas Labor Code, and combined with the evidence admitted at trial, find negligence as a matter of law, thereby leaving only the issue of damages for determination [sic].

As earlier stated, United Scaffolding merely requires a cogent and reasonably specific explanation of the reasoning that led the court to conclude that a new trial was warranted. 377 S.W.3d at 688. Although the order need not provide a Pool-like detailed analysis, it will not stand if it provides little or no insight into the judge’s reasoning. Id. at 687-88.

In this instance, we find that the trial court’s order was cogent, reasonably specific, and demonstrated that the trial court did not merely parrot legal standards without consideration of the facts. We understand the trial court to say generally that Painter I so permeated trial proceedings from beginning to end that a new trial was warranted. Specifically, the trial court states that the decision affected (1) its rulings on motions brought by the parties, including previous motions for summary judgment; (2) the evidence presented at trial; (3) the charge given to the jury; and (4) whether under the Painter II standard the trial court needed to find that Villegas and Ruiz were injured in the course of employment as a matter of law, leaving only damages as an issue for jury resolution.

Facial validity is established. Thus, we proceed to an analysis of the merits of whether this ground supports a grant of new trial.

2.

A threshold issue in this case required the trial court to determine whether Villegas and Ruiz were deemed as acting in the course and scope of employment as a matter of law given that Rudolph had not only conceded the employee status of both individuals, but also conceded its ownership of the premises where Villegas sustained her injury. Basing its case in the trial court largely on a distinction this Court drew in Painter I, Rudolph argued that, under a task-based right to control standard, neither Villegas nor Ruiz were acting in the course and scope of their employment with Rudolph at the time of the incident. Specifically, Rudolph argued it did not exercise control over the actions of either employee at the time of the incident, as both were off duty when the incident occurred.

To resolve the mandamus challenge as to this disputed issue, we must answer three questions. First: Did the Painter I decision affect the way this case was tried by wrongfully demanding a task-based, on-the-clock versus off-the-clock approach to determining course and scope of employment rather than relying on precedents applicable when employment status is not at issue? Second: If so, was Rudolph subject to direct liability—as a nonsubscriber employer—due to Villegas sustaining injuries, while on premises, proximately caused by a fellow employee; or, did the coming-and-going rule preclude recovery? Third: If the exception to the coming-and-going rule, or the so-called premises/access doctrine, should be applied to this case, was error harmless given that Villegas received a jury instruction that included language from that doctrine?

a. The Change in Law from Painter I to Painter II

The Painter cases involved a vehicle accident that occurred after a group of Amerimex employees working on an oil drilling project had finished their shift and were in transit, on a remote public road, headed to a bunkhouse located thirty or forty miles from the worksite. Painter I, 511 S.W.3d at 702. Amerimex provided the bunkhouse as living quarters for the crew. Id. Employee J.C. Burchett, a crew leader, drove the vehicle. Id. Amerimex provided Burchett with daily bonus payments if he provided other employees with transportation to the drill site to ensure they were not hired away by other drillers in the area. Id. Following the accident, Burchett sought workers’ compensation benefits from Amerimex’s insurance carrier, but the passengers in the vehicle forewent any such claims, and instead, filed suit against Amerimex not as employees but as third-party plaintiffs. Id. at 703. One of the passengers’ theories of liability, which was severed from other theories, contended that Amerimex was vicariously liable for Burchett’s actions because Burchett was acting in the course and scope of his employment at the time of the accident. The trial court granted summary judgment in favor of Amerimex on that theory, finding no vicarious liability under the circumstances. Painter and the other passengers appealed to this Court. Id. at 703-04.

On appellate review, this Court held that the definition of course and scope used in the workers’ compensation context differed from the definition used in the common-law-vicarious-liability context because the workers’ compensation definition was grounded in a statute that required liberal construction of its terms in favor of injured workers, whereas the common law definition that applied to third-party claims imposed no such presumption. Id. at 708-09. We further held that while Painter may have raised a fact issue on course and scope under the workers’ compensation standard, he could not raise a fact issue under a vicarious liability standard because:

(1) workers’ compensation law arose in the context of a pervasive statutory scheme enacted by the Legislature to carefully balance competing interests, whereas vicarious liability was a matter of pure policy determination and risk-shifting under the common law, making the analytical approach between the two areas of law substantively different; and, consequently,

(2) the common law vicarious liability standard was more stringent than the workers’ compensation standard and required specific proof that the employer had the right to control the activity in question, which the Court defined under the circumstances to include specific control over the manner of travel or the route. See id. at 708-09 & 711.

Based on this distinction, we affirmed the trial court’s grant of a no-evidence summary judgment motion, on the course and scope of employment element, finding no evidence showing that “Amerimex had or exercised any control over the manner of transportation—the type of vehicle used, the qualifications of the driver, the number of passengers, or any other issues which might implicate the kind of control that justifies shifting the risk of loss from one party to another.” Id. at 712-13.

Finding error with our analysis, the Supreme Court of Texas reversed Painter I and remanded the case for further proceedings. Painter II, 561 S.W.3d at 128. As a starting point, the Supreme Court described the doctrine of respondeat superior, or vicarious liability, as meaning “liability for one person’s fault may be imputed to another who is himself entirely without fault solely because of the relationship between them.” Id. at 130. This common law doctrine reflects, “a deliberate allocation of risk in line with the general common law notion that one who is in a position to exercise some general control over the situation must exercise it or bear the loss.” Id. at 131 (internal quotations omitted). Notably, Painter II highlighted the employer-employee relationship as “one implicating the doctrine’s risk-shifting policies.” Id.

To recover on a third-party claim based on vicarious liability, Painter II reiterated that a plaintiff must show that, at the time of the allegedly negligent conduct, the worker (1) was an employee and (2) was acting in the course and scope of his employment. Id. Generally, as Painter II explained, an employer “is insulated from liability for the tortious acts of its independent contractors.” Id. Accordingly, disputes may arise over whether a particular worker acted as an independent contractor rather than as an employee. Id. As to the first element, then, courts examine “whether the employer has the right to control the progress, details, and methods of operations of the work.” Id. (citing Limestone Prods. Distrib., Inc. v. McNamara, 71 S.W.3d 308, 312 (Tex. 2002)). Elaborating on the course-and-scope element when employment status is not disputed, Painter II further described that vicarious liability arises only if the tortious act falls within the scope of the employee’s “general authority in furtherance of the employer’s business and for the accomplishment of the object for which the employee was hired.” Id. (citing Goodyear Tire & Rubber Co. v. Mayes, 236 S.W.3d 754, 757 (Tex. 2007). “[T]he act must be of the same general nature as the conduct authorized or incidental to the conduct authorized.” Id. (internal quotations omitted). “[I]f an employee deviates from the performance of his duties for his own purposes, the employer is not responsible for what occurs during that deviation.” Id.

Contrary to our decision in Painter I, the Supreme Court held that the task-based, right-to-control test was not relevant to the second prong of the analysis, that is, the determination of whether an employee was acting within the course and scope of employment. Id. at 132. Rather, the right-to-control test applied solely to the first prong of determining whether an actor is deemed an employee or independent contractor, and whether a third party can hold the employer liable (for actions of an employee) or not liable (for actions of an independent contractor). Id. at 131-32. Painter II reiterates that when an employer-employee relationship “is undisputed, the employer essentially concedes the existence of the right to control that is necessary to give rise to the relationship.” Id. at 132. Because Amerimex conceded that Burchett worked as its employee, the focus of the inquiry shifted to whether he was acting within the course and scope of employment at the time he was driving from the drill site to the bunkhouse. Id. The Court clarified that “[t]he employer’s right to control the work, having already been determined in establishing the employer-employee relationship, is not part of this analysis.” Id. at 132-33.

Pursuant to the so-called coming-and-going rule, Amerimex argued that an employer is generally not liable for the acts of its employees while the employee traveled to and from work. Id. at 135. As to this argument, Painter II acknowledged: “[w]e have long recognized a version of this principle in the workers’-compensation context, holding that as a general rule an injury received while using the public streets and highways in going to or returning from the place of employment is not compensable because not incurred in the course of employment.” Id. at 136 (citing Tex. Gen. Indem. Co. v. Bottom, 365 S.W.2d 350, 353 (Tex. 1963) (a case arising under the Texas Workers’ Compensation Act) and TEX. LABOR CODE ANN. § 401.011 (12) (defining “course and scope of employment in Workers’ Compensation Act to exclude, with limited exceptions, “transportation to and from the place of employment”)) (internal quotations omitted). Painter II thus confirmed that the coming-and-going rule and the special assignment exception to that rule, both of which are concepts borne from workers’ compensation jurisprudence, continued to apply when determining vicarious liability. Id. This holding ran contrary to Painter I, in which we held that the standard for determining course and scope of employment under the vicarious liability standard was both different and more stringent than the standard set forth under applicable workers’ compensation law.

Applying the coming-and-going rule and its exceptions to the question of whether an employee was acting within the course and scope of employment, Painter II concluded that a fact issue existed with regard to the third-party claims of the passengers: that is, the evidence showed that one of Burchett’s specific duties included his provision of transportation of his crew to and from the drilling site, which benefitted Amerimex, who needed the crew to show up for each shift as planned. Id. at 135. The fact that Amerimex chose not to control the specific details of the transportation arrangement did not change the fact that Amerimex inherently retained the ability to control those details given Burchett’s employment. Id. Because the evidence raised at least a fact issue, the Supreme Court reversed the grant of summary judgment and remanded the case for further proceedings. Id.

In summary, Painter I, which operated as controlling law during the bulk of trial proceedings in this case, wrongly held that even if an employee was acting within the course and scope of employment as understood under the Workers’ Compensation Act, the evidence must further show that the employer exercised actual control of the specific task to impose third party liability. In short, Painter I demanded a standard that required courts or a trier of fact to look at the specific task being performed and determine whether that task was subject to the employer’s actual control. If so, the employee was deemed as acting in the course and scope of employment and vicarious liability could attach; if not, vicarious liability could not attach.

By confirming the application of concepts borne from workers’ compensation jurisprudence, Painter II rejected the task-based control approach to vicarious liability when employee status is undisputed and only course and scope remained a contested issue. For imposition of liability, Painter II clarified that the dispositive issue simply questioned “whether the employee was performing the tasks generally assigned to him in furtherance of the employer’s business” by “acting with the employer’s authority and for the employer’s benefit[,]” not whether the employer controlled the manner and means in which the employee performed the activity at the time of the occurrence. Painter II, 561 S.W.3d at 138-39.

b. The Effect of Painter II on this Case

It is fair to say that Rudolph tried this case largely in the shadow of Painter I. Villegas asserted she sought recovery for injuries incurred while working for a non-subscribing employer pursuant to section 406.033 of the Texas Labor Code. In furtherance of her claim, she argued that she and Ruiz were employed by Rudolph and were working on Rudolph’s premises when she sustained an injury in the course of her employment. Despite conceding the employment status of both Villegas and Ruiz, Rudolph opposed liability based on an argument that neither Ruiz nor Villegas were acting in the course and scope of their employment at the time of the incident. Rudolph relied on a task-specific, on-the-clock versus off-the-clock standard for establishing course and scope.

Rudolph argued it could not be held liable for Villegas’s injuries, either directly or vicariously, because it did not control the actions of either employee at the time of the injury, as the incident occurred after the close of business while the employees were engaged in leaving the premises. Indeed, Rudolph explicitly cited to Painter I in its response to the plaintiff’s motion for summary judgment in arguing for a control-based definition of “in the course and scope of employment” that was more stringent than how that term was traditionally defined in the workers’ compensation context. But Painter I created a distinction in how course and scope of employment was defined that Painter II expressly refuted when employment status of an employee is not disputed.

Explaining the general framework of vicarious liability, Painter II reiterated that “liability for one person’s fault may be imputed to another who is himself entirely without fault solely because of the relationship between them.” Painter II, 561 S.W.3d at 130 (citing St. Joseph Hosp. v. Wolff, 94 S.W.3d 513, 540 (Tex. 2002) (plurality op.)). Painter II described the reasoning for not applying a task-based test in the vicarious liability context as follows:

Amerimex would have us reevaluate the worker’s employment status for vicarious-liability purposes by isolating the task the worker was performing at the moment of the accident and conducting an independent evaluation of the employer’s control with respect to that particular task. This position is inconsistent with the framework we have described. Further, it results in an unworkable paradigm that conceivably could result in an individual shifting between employee and independent contractor status countless times in a given work day. (Internal quotations omitted).

See Painter II, 561 S.W.3d at 133 (citing Mid-Continent Cas. Co. v. Andregg Contracting, Inc., 391 S.W.3d 573, 578 (Tex.App.—Dallas 2012, pet. denied)).

At least when it comes to the element of course and scope and whether employer liability may be imputed for injuries that occur while going to and from a workplace, the standards of direct and vicarious liability are one and the same. Id. at 136. We agree with the trial court that the Painter line of decisions had a substantial effect on the way this case was tried by wrongly pulling the focus from our long-standing jurisprudence inherent to employer-employee relationships to a task-based approach that more aptly applies to cases involving independent contractors and supervisory liability. See Painter II, 561 S.W.3d at 136; see also Kroger v. Keng, 23 S.W.3d 347, 349 (Tex. 2000) (“[Texas] Labor Code § 406.033, which is part of the Workers’ Compensation Act, governs an employee’s personal-injury action against his or her employer, when the employer is a nonsubscriber under the Act.”).10

On mandamus, Rudolph retreats somewhat from direct reliance on the logic of Painter I and instead argues generally that the jury’s determinations on course and scope of employment (including the question of whether Villegas and Ruiz’s actions were done in furtherance of Rudolph’s business interests) are supported by substantial evidence because: (1) Ruiz and Villegas had both clocked out and were leaving the dealership to go home when the accident occurred, (2) both were parked in front of the dealership, “which was not the sole or primary designated parking area for employees,” (3) the accident occurred after Ruiz backed his truck out of the parking space and was pulling forward to leave the parking lot to go home, and (4) Villegas had been approaching her vehicle in the same parking lot but changed direction and walked into the path of Ruiz’s truck just before he hit her. But, as to this detailed list of factors, Painter II established that the task-based on-the-clock/off-the-clock distinction cited as item 1 is not dispositive and largely an artificial distinction that unnecessarily subjects a nonsubscriber case to double scrutiny on the issue of control. Here, it is undisputed that both Villegas and Ruiz were employees subject to Rudolph’s general authority by virtue of their employment status. Moreover, items 2, 3, and 4 simply confirm that the incident occurred on the premises, not on a public street or highway.

c. No Fact Issues

Applying the on-premises/access doctrine to this case, we conclude that the trial court’s determination that it needed to reconsider whether Villegas and Ruiz were acting in the course and scope of employment as a matter of law was a plausible consequence of Painter II’s issuance on the day of the verdict. Undoubtedly, such reconsideration would impact the characterization of Villegas’s claim as a negligence suit brought pursuant to section 406.033 of the Texas Labor Code. But even still, as a third-party claim based on vicarious liability, the course-and scope analysis applied to Ruiz would not include a task-based analysis. The change from a fact-intensive, task-based approach to a premises-based approach represents a significant shift in a major assumption that permeated this entire trial.

As such, the trial court’s determination that it would have conducted the trial differently is reasonable under the circumstances as shown by the mandamus record. With respect to the motion for summary judgment specifically, we find it to be plausible that the trial court would reconsider the denial of summary judgment on the course and scope issue had it had the benefit of Painter II. All that is required to establish course and scope under the on-premises rule, and its extension into the access doctrine, is a showing that an employer has evinced an intention that a particular area of premises or access route can be used by the employee in going to and from work and the area or access route is so closely related to the employer’s premises as to be fairly treated as part of the premises. See Tex. Comp. Ins. Co. v. Matthews, 519 S.W.2d 630, 631 (Tex. 1974); see also Nabors Drilling, U.S.A., Inc. v. Escoto, 288 S.W.3d 401, 404-05 (Tex. 2009) (“An employer ordinarily will not be liable for torts committed by off-duty employees except when the torts were committed on the employer’s premises or with the employer’s chattels.”).

It is undisputed that Villegas and Ruiz were employees of Rudolph at the time of the incident. It is also undisputed that Villegas was injured while on Rudolph’s premises, not on a public street or highway. We conclude that the trial court’s reasoning is sound on the merits, and as a court reviewing this matter for abuse of discretion from a cold record, we must give the trial judge, who sat through the trial in its entirety and who presumably would not elect to redo it over again but for an adequate reason, some berth and leeway in this mandamus posture.

d. Harmful Error Analysis

Rudolph argues that even if the access doctrine should have applied in this case, Villegas cannot obtain a new trial under these circumstances because the trial court granted a charge that she requested which instructed the jury on this doctrine. Specifically, Question 1, which asked the jury if Flores, Villegas, and Ruiz were acting in the course and scope of their employment at the time of the accident, contained an instruction stating:

An injury occurring while the employee is traveling to or from work is in the course of employment only if the employee is injured at a place where the employer has evidenced an intention that a particular route or area be used by the employee in going to or from work and where the route or area is owned by the employer or is so closely related to the employer’s premises as to be fairly treated as a part of the employer’s premises.

The jury found that Flores was acting in the course and scope of employment, but that Villegas and Ruiz were not. Rudolph takes this answer as conclusive evidence that the jury considered this issue and declined to find that Villegas was acting in the course and scope of employment. In other words, all other factors aside, Rudolph argues the jury was directed to answer the course and scope question having received an instruction about the premises/access doctrine.

While Rudolph is correct that the jury received such instruction, the problem with this argument is that it wholly ignores Villegas’s argument on summary judgment and reframes the matter into questions of charge error and legal insufficiency. But here, we are not tasked with determining whether the jury was correctly instructed or whether the evidence supported the verdict. Rather, we must determine on mandamus review whether the trial court’s stated reason provides a legally sound rationale that is based on the record. See In re Toyota, 407 S.W.3d at 749. Based on Painter II and other authorities cited by Plaintiffs’ motion for judgment notwithstanding the verdict, the trial court stated that it needed to reconsider whether Villegas was acting in the course and scope of her employment as a matter of law. The implication attributed to Painter II makes sense, as the clarification from the Supreme Court of Texas shifted the focus of inquiry from whether Villegas and Ruiz were “on the clock” or “off the clock” at the time of the incident (i.e. whether their individual activities at the time of the incident were subject to Rudolph’s task-by-task control under Painter I) or whether the incident occurred on Rudolph’s premises.

Rudolph, in its mandamus petition, does not argue that there is a fact issue that would preclude summary judgment and create a triable issue under an on-premises/access doctrine framework. It argues only that any error in trying the case was harmless because the jury charge was substantially correct as to its inclusion of the doctrine. But that reasoning only applies if there are relevant fact issues for the jury to decide. Because we find that the trial court stated a legally plausible explanation for its ruling on Painter II grounds, and because Rudolph did not refute the proposition that there were no material fact questions for determination under the access/premises doctrine that Villegas was injured on premises belonging to Rudolph, the grant of a new trial on this ground is not a clear abuse of the trial court’s discretion.

We find that this ground, either standing alone or taken in concert with others, is sufficient to support the grant of a new trial.

Accordingly, we overrule Issue Three.

C. The Expert Testimony

In Issue Four, the third sub-issue, Rudolph contends that the trial court abused its discretion by granting a new trial based on expert testimony, which it also contends, the jury unequivocally stated it could disregard pursuant to the trial court’s limiting instructions. In its order, the trial court stated that defense expert Gary Wimbish “intentionally injected unreliable double hearsay, non-responsive to the question asked him in an attempt to inject an improper inference before the jury.” The court further stated, “[t]hough the Court did admonish the witness as well as instruct the jury to try to eliminate the harm, it is obvious to this Court that the harm done could not be eliminated or removed.” Based on its observation, the trial court concluded that “this improper evidence and behavior to impugn the character of Irma Vanessa Villegas did cause the rendition of an incorrect verdict by the Jury as the evidence showed Irma Vanessa Villegas was a hardworking dependable and responsible mother, grandmother and sister; there was no negative evidence or detracting evidence other than expert Wimbish’s testimony.” We agree that the record establishes that this basis constituted a valid ground on which to grant a new trial such that Rudolph failed to show a clear abuse of discretion.

1.

As with the other grounds, Rudolph attacks this ground as being facially invalid and vague. In arguing that the effect of Dr. Wimbish’s testimony cannot be firmly established, Rudolph rhetorically asks whether this improper testimony led the jury to find Villegas to be partially negligent, whether it led the jury to assign her a higher percentage, or whether it had an effect on damages. Rudolph concludes that because the trial court’s order does not specify which of those options are at play, the order for new trial is facially invalid.

Again, we reiterate that a trial court has a duty to “explain how the evidence (or lack of evidence) undermines the jury’s findings.” United Scaffolding, 377 S.W.3d at 689. On this ground, the trial court articulates that it granted a new trial because Dr. Wimbish’s testimony “injected unreliable double hearsay, non-responsive to the question asked him in an attempt to inject an improper inference before the jury” and the harm from those comments “could not be eliminated or removed” by the trial court’s instructions. In order words, the trial court articulated that it found that Dr. Wimbish made improper, potentially inflammatory comments in violation of the Rules of Evidence that prejudiced the jury against Villegas. We conclude that this reasoning is specific enough to meet the standard for facial sufficiency.

2.

Having determined that the trial court’s order on this ground meets the facial requirements, we next assess the stated ground on its merits but within the prism of a mandamus review. We review the trial court’s admission or exclusion of evidence for abuse of discretion. Hernandez v. Moss, 538 S.W.3d 160, 167 (Tex.App.—El Paso 2017, no pet.). A trial court abuses its discretion on evidentiary issues if it acts arbitrarily or unreasonably, or without reference to guiding principles or rules. Id. A trial court’s erroneous decision to admit or exclude evidence is not reversible unless the error probably caused the rendition of an improper judgment. TEX. R. APP. P. 44.1(a).

Dr. Wimbish, a board-certified forensic toxicologist with more than 40-years’ experience, was called to testify regarding Villegas’s and Ruiz’s respective blood-alcohol content, whether alcohol affected Ruiz on the night of the accident, and if so, to what extent. Dr. Wimbish testified that Ruiz had a BAC of .02 and Villegas had a BAC of .04, both under the legal limit of .08. During cross-examination by plaintiff’s counsel, Dr. Wimbish made comments relaying information he had gleaned from the deposition of another worker at Rudolph—testimony that was otherwise not admitted at trial—suggesting that Villegas had an alcohol problem:

Q.... You’ve been telling the jury about naive drinkers and nonnaive drinkers and what you eat and all that stuff. You’ve been telling us all about that, but I’m talking about the black-and-white language on the chart that you provided. So on the chart that you provided it shows impairment listed as a clinical sign and symptom between .01 and .05. Correct?

A. That’s correct. But if we believe in those charts, we wouldn’t need toxicologists or the police officers.

Q. Okay. Now, in terms of Ms. Villegas, you listed her as a. 04. So according to your listing, I guess she’d fall in both categories?

A. She could fall in either one.

...

Q. The alcohol she consumed was consumed on the premises of Rudolph Mazda?

A. And that’s the only information I have.

Q. And the information that you have includes that the alcohol was allowed by Rudolph’s head person in charge on that night?

A. My information is a bit different from that.

Q. What information do you have that’s different from that?

A. Well, in the information that I have received, she brings alcohol with her to work, and --

Q. Who?

A. -- and it’s the information that I have -- and had been drinking out of her cup on her own supply of alcohol that day.

Q. So you are taking the testimony of Lisa Melbourne who said -- is that where you’re getting that from?

A. I don’t remember the exact person, but that information was available to me. And then there’s clinical information -- and I’m not being derogatory. I’m just trying to say this is information that I considered. Okay? She verified in her statement she may have a problem with alcohol because having to wake up in the middle of the night and drink alcohol so she can go back to sleep.

Q. Okay, sir. I’m not --

[Plaintiffs’ attorney]: Yeah. Can we approach actually?

Following a discussion at the bench, Villegas moved for a mistrial. The record shows the trial judge commented on the “disturbing” testimony injected by Wimbish at the very end of trial, and he debated granting a mistrial in full, but ultimately found that the comment came as the result of a broadly worded question and decided to admonish the jury to disregard the comments. The trial court’s decision to deny a mistrial and grant a new trial came after the jury’s verdict was received.

Villegas argues that the trial court could have correctly granted the new trial based on Dr. Wimbish’s testimony because he was cloaked in the aura and authority of an expert in the eyes of a jury. Rudolph argues that even if Dr. Wimbish’s testimony was error, it was harmless, since there was adequate testimony to support the jury’s comparative negligence finding against Villegas. As support, Rudolph argues that Ruiz testified that immediately before the accident that he saw Villegas appear in front of his truck with her hands in the air and saying his name. Rudolph also pointed out that the evidence showed that Villegas had findings of a .04 BAC and may have stepped in front of Ruiz’s truck. Rudolph points out that an instruction to disregard testimony is generally presumed to cure any error. See Lee v. State, 779 S.W.2d 913, 916 (Tex.App.—Houston [1st Dist.] 1989, pet. ref’d) (“An instruction to disregard cures any error unless the evidence is clearly calculated to inflame the minds of the jury and is of such a character as to suggest the impossibility of withdrawing its impression on the jury.”). Rudolph also downplays Dr. Wimbish’s importance as a witness, saying his testimony was “obscure” especially when considering the many witnesses that the Plaintiffs called to testify about Villegas’s condition and her relationship with Juarez.

Again, to obtain mandamus relief from the new trial order, Rudolph bears the burden of showing that the trial court clearly abused its discretion. Villegas has offered a plausible explanation for the trial court’s decision—namely, the weight an expert witness’s opinion would carry on the jury, particularly when the expert revealed information that had been subject to a motion in limine. Rudolph has not shown that the trial court’s decision to grant a new trial based on Dr. Wimbish’s comments constituted a clear abuse of discretion for which mandamus must issue. As such, mandamus relief is improper as to this ground. This ground may justify the grant of a new trial in its entirety either individually or standing in concert with another ground.

Accordingly, we overrule Issue Four.

D. Line-Item Awards of Zero Damages

Because each of the foregoing grounds, standing alone or collectively, would justify the grant of a new trial in its entirety, we decline to address Rudolph’s remaining two sub-issues which challenge the grant of new trial based on the jury’s award of zero damages on several line items of damages, which, if meritorious, would result in a new trial grant as to damages only. We conclude in this instance that resolution of the remaining sub-issues is unnecessary to the disposition of this appeal. See TEX. R. APP. P. 47.1.

Accordingly, we overrule Issue One, the overarching issue, as well as Issues Five and Six, the two remaining issues on damages.

CONCLUSION

As provided above, there are several grounds, individually and collectively, that would support the trial court’s new trial order in its entirety. Because no clear abuse of discretion has been demonstrated, we conclude that the order granting a new trial is not subject to mandamus correction by this Court. Rudolph’s petition for a writ of mandamus is denied.

DISSENTING OPINION

JEFF ALLEY, Chief Justice

Who loses when a trial court grants a motion for new trial after a three-week trial? Well, the party that prevailed, or partially prevailed certainly does. But so do the twelve jurors who took three weeks out of their life to hear and decide an important dispute. Other litigants that could have used that three weeks to have their cases heard are also the losers, as they missed the opportunity to utilize valuable court time. And whenever the case is reset, another twelve jurors (plus alternates) will have to put their lives on hold for three weeks to possibly decide a gut-wrenching case. Moreover, another set of litigants will have to sit on the sidelines waiting their turn to try a case. We could add to the list of losers the third-party witnesses who may have to testify again, and of course the taxpayers who foot the bill for the court staff and facilities.

In sum, the cost to society is tangible, and accordingly, our Supreme Court has laid out a framework for review whenever a trial court exercises its discretion to grant a new trial. In my opinion, under that framework the real-parties-in-interest successfully challenge each of the four grounds advanced by the trial judge to set aside the three-week trial in this case. Accordingly, I respectfully dissent.

The Court correctly sets out a statement of the case and the standards for mandamus relief. In summary, the trial court’s stated reason must be (1) legally appropriate and (2) specific enough to show that the trial court derived its reasons from the facts and circumstances of the case before it. In re United Scaffolding, Inc., 377 S.W.3d 685, 688-89 (Tex. 2012). And if the stated reasons are appropriate, we are directed to also determine whether the trial court’s articulated reasons find support in the underlying record. In re Toyota Motor Sales, U.S.A., Inc., 407 S.W.3d 746, 756 (Tex. 2013). In this case, the trial court granted a new trial based on (1) an apparent conflict in the jury findings, (2) its purported reliance on one of our decisions that was later overturned, (3) an expert who violated a motion in limine, and (4) alleged inconsistency between the damages evidence and the damages findings. I address each in turn.

Conflict in Jury Findings

The jury failed to find that Rudolph was negligent in Question Two and Three, but contrary to a conditioning instruction, assigned it a percentage of responsibility (10%) in Question Four. I agree with Rudolph that any conflict between the answers to those questions was waived when the issue was not raised before the trial court discharged the jury, and that in any event, the problem has a simple mathematical fix.

If a trial court intends to grant a new trial based on error occurring during trial, the error must have been the kind that would be reversible if appealed. That was the case in In re Toyota, where the trial court granted a new trial because it thought Toyota violated a limine order excluding certain testimony. In re Toyota Motor Sales, U.S.A., Inc., 407 S.W.3d 746, 749 (Tex. 2013) (orig. proceeding). Yet the Texas Supreme Court held that the record did not support the trial court’s new trial order because the plaintiffs had not preserved the complaint at trial. Id. at 760 (“where, as here, the party that requested the limine order itself introduces the evidence into the record, and then fails to immediately object, ask for a curative or limiting instruction or, alternatively, move for mistrial, the party waives any subsequent alleged error on the point.”). And here, no party objected that there was a conflict in the jury findings before the jury was discharged.

The majority blunts this point by holding that a post-trial motion can also preserve error, citing a plurality from USAA Tex. Lloyds Co. v. Menchaca, 545 S.W.3d 479 (Tex. 2018). In Menchaca, four Justices agreed that a party should object to conflicting answers before the trial court dismisses the jury, but they went on to write that “[t]he absence of such an objection, however, should not prohibit us from reaching the issue of irreconcilable conflicts in jury findings.” Id. at 526 (C.J. Hecht, J. Green, J. Guzman, and J. Brown, dissenting). Three Justices, however, opined that irreconcilable jury responses do not constitute fundamental error, and concluded that an objection was required prior to the jury’s discharge. Id. at 510–20 (J. Boyd, J. Lehrmann, and J. Devine, plurality op.). Nonetheless, those same three Justices agreed that the case should be remanded for a new trial in the interest of justice, a power unique to the Texas Supreme Court, because of prior confusion in the error preservation requirements for irreconcilable jury responses. Id. at 520-21; see also TEX.R.APP.P. 60.3 (authorizing Texas Supreme Court to remand in interest of justice).

I would hew to the basic proposition that any error in conflicting jury findings needs to be raised while the jury is still present to resolve the conflict, and that post-trial motions do not preserve error. See Critical Path Resources, Inc. v. Huntsman Intl., LLC, No. 09-17-00497-CV, 2020 WL 1291327, at *17 n.66 (Tex.App.--Beaumont Mar. 19, 2020, no pet.) (mem. op.) (holding under Menchaca that a post-verdict motion failed to preserve right to complain about any alleged conflict in jury findings). That is how Rule 295 reads. See TEX.R.CIV.P. 295 (if the “answers to the [jury] questions are in conflict, the court shall in writing instruct the jury in open court of the nature of the incompleteness, unresponsiveness, or conflict, provide the jury such additional instructions as may be proper, and retire the jury for further deliberations.”). That is closest to our prior precedent. Rhey v. Redic, 408 S.W.3d 440, 464 (Tex.App.--El Paso 2013, no pet.). And that is in accord with the requirement for a “timely” objection which is an express requirement of Rule 33.1. TEX.R.APP.P. 33.1 (prerequisite for appeal requires a “a timely request, objection, or motion”). By raising the issue in a motion for new trial, the real-parties-in-interest leave the trial judge with only one remedy—declare the entire trial a nullity and start anew. Following Rule 295, however, would have at least provided the opportunity to fix any conflict between Question 2, 3, and 4. Borrowing from our criminal jurisprudence, the key to error preservation is for a litigant “to let the trial judge know what he wants, why he thinks himself entitled to it, and to do so clearly enough for the judge to understand him at a time when the trial court is in a proper position to do something about it.Lankston v. State, 827 S.W.2d 907, 909 (Tex.Crim.App. 1992) (emphasis supplied). The difference in possible remedies makes preservation through a motion for new trial a poor cousin to fixing the problem while the jury is still in the box. For that reason, I decline to join the majority approach of allowing for post-jury-discharge objections to conflicting findings.

But even beyond that preservation issue, I disagree that the conflict here is fatal and cannot be harmonized. This is not the first time that a jury has answered the negligence inquiry “no” but assigned a percentage of fault to the same party. See Beltran v. Brookshire Grocery Co., 358 S.W.3d 263, 269 (Tex.App.--Dallas 2011, pet. denied) (collecting cases). And courts facing that predicament have concluded that “[i]ssues establishing or negating liability control over the issue which apportions, rather than establishes, negligence.” Id.; see also Garza v. Waco Scaffold and Shoring Co., 576 S.W.2d 442, 446 (Tex.App.--El Paso 1978, writ ref’d n.r.e.) (“the specific finding directed toward the liability aspect of the verdict controls over the general finding of comparative negligence”). And when faced with that prospect here, the trial court could still formulate a verdict by proportionally distributing the erroneous 10% finding over the three remaining percentages of responsibility. See Garza, 576 S.W.2d at 446; Beltran, 358 S.W.3d at 269; Ingles v. Cohen, 543 S.W.2d 455, 456–57 (Tex.App.--Waco 1976, writ ref’d n.r.e.). The real-parties-in-interest discount these cases because they predate broad form submission. But whether a jury answered a series of specific negligence questions “no” or one broad form question “no,” and then answered an apportionment question inconsistently seems a distinction without a difference.

The Painter Decision

The trial court also based its new trial motion on the change in law when our decision in Painter v. Amerimex was overturned by the Texas Supreme Court just as the trial ended. Painter v. Amerimex Drilling I, Ltd., 511 S.W.3d 700 (Tex.App.--El Paso 2015), rev’d, 561 S.W.3d 125 (Tex. 2018). In Painter, the crew leader of an oil drilling rig drove his crew from a remote drilling site to company housing in a nearby town. The crew leader was in his personal vehicle and work had finished for the day. While en route, he collided with another vehicle and the resulting accident killed and injured several crew members. The victims sued the crew leader and his employer.

The employer obtained a summary judgment based on the argument that the employer could not be vicariously liable for the crew leader’s conduct unless the employer controlled his actions at the time of the accident. Id. at 709. Attempting to reconcile conflicting authority on that issue, we agreed with the trial court and upheld the summary judgment. 511 S.W.3d at 710-11, citing, e.g., London v. Texas Power & Light Co. 620 S.W.2d 718, 719-20 (Tex.App.--Dallas 1981, no writ) (“The test of a master’s liability for the negligent acts of his servant is whether at the time and occasion in question, the master has the right and power to direct and control the servant in the performance of the causal act or omission at the very instance of its occurrence.”) (emphasis supplied) and J & C Drilling Co. v. Salaiz, 866 S.W.2d 632, 636 (Tex.App.--San Antonio 1993, no pet.) (“When the employer does not require any particular route, the employee is not engaged in the furtherance of the employer’s business.”).

The Texas Supreme Court disagreed with this Court, and some of the cases we relied on, instead holding that the relevant inquiry to impose vicarious liability was whether at the time of the negligent conduct, “the worker (1) was an employee and (2) was acting in the course and scope of his employment.” Painter II, 561 S.W.3d at 131, 132. The element of control is bound up in the first question—employment status—and not the course and scope question. Id. at 132 (“Accordingly, we disagree with those courts of appeals that have tied the right-to-control analysis to the course-and-scope element of a vicarious-liability claim.”). Moreover, that control should not be evaluated on a task-by-task basis. Id. at 138. And the course and scope question “hinges on an objective assessment of whether the employee was doing his job when he committed a tortious act.... The employer’s right to control the work, having already been determined in establishing the employer-employee relationship, is not part of this analysis.” Id. at 132-33. The Supreme Court remanded the case because the summary judgment record revealed factual disputes over whether the crew leader was in the course and scope of his employment by driving the crew to its housing. Id. at 139.

In this case, the trial court granted a new trial here in part because:

[T]he Texas Supreme Court decision in Painter v. Ameritex [sic] rendered on April 213,2018, [sic] the day of this Jury Verdict, was important law that affected the earlier decision s [sic] of this Court on motions filed by the parties, the evidence presented at trial and the charge given to the Jury. Based on the Painter opinion and other relevant decisions and authority as set forth in Plaintiff s Motion for Judgment NOV, it appears to this Court that it needs to reconsider whether Irma Vanessa Villegas and Christian Ruiz were injured in the course of employment as a matter of law which would make Plaintiff s claim a non-subscriber negligence case under 406.33 [sic] of the Texas Labor Code, and combined with the evidence admitted at trial, find negligence as a matter of law, thereby leaving only the issue of damages for determination.

I agree with Rudolph that the trial court’s claim that Painter affected its earlier decisions on (1) pending motions, (2) the evidence presented at trial, and (3) the jury charge is either conclusory or is not supported by the record. The only motions that the parties point to were competing motions for summary judgment on the course and scope issue. Rudolph argued for a summary judgment in part based on our Painter decision (before it was reversed) but the trial court denied that motion. The trial court also denied the real-parties-in-interest’s motion for summary judgment, but I fail to see how Painter II would have changed that ruling. In Painter II, after all, the court remanded the case for trial based on the existence of a fact issue. Consistent with that outcome, the trial court also submitted a course and scope question to the jury.

The majority’s elongated discussion of Painter fails to point to a single evidentiary ruling, or other trial ruling colored by Painter I. Nor have the parties identified any defect in the charge occasioned by the trial court’s reliance on Painter I. The accident at issue in Painter occurred well away from the worksite, and parties there argued the “coming and going” rule and cases applying that rule. 511 S.W.3d at 706.1 The accident here occurred in Rudolph’s parking lot. And the parties disputed whether the “access doctrine” which is an exception to the coming and going rule would apply. That doctrine allows employees to recover workers’ compensation benefits if they are “injured while going to or from work, if on routes designated by their employers and at locations near where they work, ... ‘where such access route or area is so closely related to the employer’s premises as to be fairly treated as a part of the premises.’ ” OCI Beaumont LLC v. Barajas, 520 S.W.3d 83, 85 n.1 (Tex.App.--Beaumont 2017, no pet.), quoting Tex. Comp. Ins. Co. v. Matthews, 519 S.W.2d 630, 631 (Tex. 1974). Moreover, the trial court actually included—at the real-parties-in interest’s request—an access doctrine instruction in the charge. Neither the trial court, nor the real-parties-in-interest articulate any additional or different charge language that would have been included had Painter II been released before, rather than after trial.

At most, the trial court states it might conclude that Irma Vanessa Villegas and Christian Ruiz were in the course and scope of employment as a matter of law based on the Texas Supreme Court’s decision in Painter. Setting aside whether that is even correct, nothing would have prevented the trial court from granting that relief post-trial based on the arguments and relief sought in “Plaintiff’s Motion for Judgment Notwithstanding the Verdict and to Enter Judgment.” Our rules specifically allow a party to file motion for judgment notwithstanding the verdict, which the real-parties-in-interest did here. TEX.R.CIV.P. 301. But rather than grant that motion, the trial court set aside the results of a three-week jury trial because it might grant a JNOV or equivalent motion in the future. I would find that to be an abuse of discretion. If the trial court believes the law places certain of these actors in the course and scope of employment as a matter of law, the court should simply grant the JNOV and let that ruling be tested on appeal.2

The Expert’s Testimony

As one of the last trial witnesses, Rudolph put on an expert toxicologist, Dr. Gary Wimbish, to opine in part that the alcohol that Ruiz drank would not have affected him on the night of the accident. Ruiz had a blood alcohol content of .02. Ms. Villegas had a BAC of .04. As the majority sets out, when Wimbish was cross-examined by plaintiffs’ counsel, he was asked to agree that all the alcohol that Villegas had that day was provided by the Rudolph. He responded that “[m]y information is a bit different from that.” Villegas’s counsel then asked him what other information he had. He then relayed that Villegas was reported to have imbibed alcohol she brought to work. And when Villegas’s counsel continued with that line of questioning—asking where he got that information from—Dr. Wimbish gratuitously added that he had seen clinical information that Ms. Villegas had a problem with alcohol such that she would wake up in the middle of the night and need to drink to get back to sleep. At that point, Villegas’s counsel asked to approach the bench and moved for a mistrial. The trial court denied the mistrial (noting that Villegas had opened the door) but then formulated this specific instruction that each juror individually had to agree that they would abide by:

COURT: You heard testimony from the witness that is not credible, is unreliable, and not evidence in this case. You are instructed to disregard the witness’s testimony – Dr. Wimbish’s testimony – on all evidence concerning Vanessa Villegas’ prior use of alcohol before the date in incident – before this incident.

Do you understand that, ladies and gentlemen?

THE JURORS: Yes, sir.

I could certainly agree that the injection of some of the drinking testimony was error. The specific reference to a drinking problem and that Villegas needed to drink to go to sleep was not responsive to the question asked. The bench conference also suggests that the information was based on double, if not triple hearsay. The injection of these matters, accordingly, could be a valid ground for ordering a new trial.

But for an error to serve as a valid basis for a new trial, it must be harmful which we define as probably causing the rendition of an improper verdict. TEX.R.APP.P. 44.1(a); Diamond Offshore Servs. v. Williams, 542 S.W.3d 539, 551 (Tex. 2018); Loera v. Fuentes, 511 S.W.3d 761, 776 (Tex.App.--El Paso 2016, no pet.). And that is where I get stumped. The trial court pointedly told the jury that the evidence was unreliable; each juror individually agreed to abide by that instruction. We generally presume that jurors will follow a court’s instructions, and only a narrow class of statements defy our ability to instruct jurors. See Living Centers of Texas, Inc. v. Penalver, 256 S.W.3d 678, 680 (Tex. 2008) (“Typically, retraction of the argument or instruction from the court can cure any probable harm, but in rare instances the probable harm or prejudice cannot be cured.”). Those rare circumstances include appeals to racial prejudice, unsupported and extreme attacks on opposing parties and witnesses, and accusing without evidence the opposing parties of witness manipulation or evidence tampering. Id. at 681 (collecting cases). The statement here falls somewhere outside that line of cases.

Nor does the record support that the jury violated the trial court’s instruction. On liability, the jury found Villegas (who had more to drink than Ruiz) slightly less at fault than Ruiz. The accident occurred when Ruiz, who had just backed out of a parking spot, put his truck into drive and drove into Villegas who was walking in front of his truck. The jury could have concluded that both driver and pedestrian failed to keep a proper look-out. Stated otherwise, there is nothing surprising about the finding of fault, or the apportionment of liability. Nor does a $3.87 million verdict call out that the jury disregarded the damages testimony because of the single isolated statement of the witness.

The Damages Findings

The majority does not reach the fourth basis for the trial court’s order—the amount of non-economic damages awarded. Because I would find each of the stated reasons for the new trial improper, I briefly address the issue.

The jury awarded a total of $4.02 million in damages, $3.87 million to Villegas (who was hit by the truck) and $150,000 to Juarez (Villegas’s adult daughter). The jury awarded Villegas these specific sums:

Medical care in the past: $630,000

Medical care in the future: $2,500,000

Physical pain and suffering in the past: $25,000

Physical pain and suffering in the future: $25,000

Physical impairment in the past: $25,000

Physical impairment in the future: $25,000

Past disfigurement: $0

Future disfigurement: $200,000

Loss of past earning capacity: $150,000

Loss of future earning capacity: $240,000

Past mental anguish: $25,000

Future mental anguish: $25,000

The awards for Juarez are as follows:

Past household services: $0

Future household services: $150,000

Past loss of parental consortium: $0

Future loss of parental consortium: $0

The trial court also granted a new trial based on the jury’s answers to eight of the damage categories, stating as follows:

As an additional and independent basis for new trial, the Court finds that the determination of Zero (-0-) Damages for past disfigurement of Irma Vanessa Villegas ... as well as Zero (-0-) Damages for daughter Andrea Juarez for Past household services and for Past and future loss of parental consortium completely ignore the undisputed facts, and the other damages [for past and future physical pain and physical impairment] fix an amount neither authorized nor supported by the evidence and is contrary to the great weight of the evidence. (Internal reference to the damage question numbers omitted).

The trial court further stated, and I accept as true, that the “undisputed evidence proved that Irma Vanessa Villegas suffered permanent irreversible traumatic brain injury and was paralyzed on one side of her body[.]” The trial court summarized the trial evidence as including “controverted evidence of constant daily pain” and her “impairment in virtually every movement.” Villegas was confined to a bed and wheelchair, and she needed round-the-clock assistance. She suffered “permanent damage to her mental faculties” such that at times she did not know her daughter, her grandchildren, and her sisters.

Rule 320 expressly provides that “[n]ew trials may be granted when the damages are manifestly too small or too large.” TEX.R.CIV.P. 320. And our high court has stated “If the jury’s failure to award damages or the amount of damages awarded is so against the great weight and preponderance of the evidence as to be manifestly unjust, shock the conscious, or clearly demonstrate bias, then a new trial would be required.” Golden Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757, 773 (Tex. 2003).

But any view of damages is also tempered by the jury’s wide discretion in awarding non-economic damages. Sanchez v. Balderrama, 546 S.W.3d 230, 237 (Tex.App.--El Paso 2017, no pet.) (“Because there are no objective guidelines to assess the monetary equivalent to [mental anguish or pain and suffering], the jury is given broad discretion in awarding an amount of damages it determines appropriate.”). This is because the “process of awarding damages for amorphous, discretionary injuries such as mental anguish or pain and suffering is inherently difficult because the alleged injury is a subjective, unliquidated, nonpecuniary loss.” Id. We recently quoted a prior sister court’s view that it is the jury’s province “to resolve the speculative matters of pain and suffering, future pain and suffering, future disfigurement, and future physical impairment, and set the amount of damages attributable thereto.” Id., quoting Duron v. Merritt, 846 S.W.2d 23, 26 (Tex.App.--Corpus Christi 1992, no writ).

We also must acknowledge the possible overlap between the damage categories here--physical impairment, physical pain and suffering, disfigurement, and pain and mental anguish. See Golden Eagle Archery, Inc., 116 S.W.3d at 771 (noting that physical impairment, physical pain and suffering, disfigurement, and mental anguish can encompass the same loss). None of these terms were defined by the charge. So, while we assume the jury followed the instruction not to award the same damages in more than one damage category, we must look to all the awards in the several categories to determine if the jury failed to properly award damages. Id.

The trial court here first focused on the failure of the jury to award any sum for past disfigurement (while awarding a substantial sum for future disfigurement). The accident resulted in a portion of Villegas’s skull being removed, leaving an indentation on her forehead and other scarring from one side of her skull to the other. There was some testimony that she bemoaned the misshapenness of her head and was given to frequent crying. “Disfigurement has been defined as that which impairs the appearance of a person, or that which renders unsightly, misshapen or imperfect, or deforms in some manner.” Doctor v. Pardue, 186 S.W.3d 4, 18 (Tex.App.--Houston [1st Dist.] 2006, pet. denied). “The matter of future disfigurement is necessarily speculative and there is no mathematical yard stick by which one can measure damages for it.” Mauricio v. Cervantes, No. 04-16-00260-CV, 2017 WL 2791324, at *3 (Tex.App.--San Antonio June 28, 2017, no pet.) (mem. op.).

Rudolph postulates that the jury awarded nothing in the past for disfigurement because Villegas as of the time of trial did not perceive her own change in appearance. It suggests that the large future disfigurement award evidences the jury’s belief she would later improve and come to learn of her disfigurement, and only then suffer the loss.3 I am unpersuaded by that specific argument. But I agree that the compensable aspect of disfigurement is how it affected Villegas, which surely encompasses her mental suffering from the injury. It could also encompass the loss of enjoyment of life that is part and parcel of physical impairment. See Golden Eagle Archery, Inc., 116 S.W.3d at 772. That overlap necessitates that a court also consider any awards for mental anguish, pain and suffering, and physical impairment in deciding if the jury truly ignored the disfigurement. And the jury did collectively award $75,000 in those categories to Villegas. Accordingly, it is incorrect to conclude the jury failed to consider at all the disfigurement in its damage calculations.4

The trial court also focused on the lack of awards for loss of parental consortium. The relationship here was between an adult child and parent. Juarez presented testimony of her belief as to the destruction of that relationship. Relators point out, however, that her credibility was challenged through cross examination on at least two matters where the jury might have concluded that Juarez was untruthful or prone to embellishment. It of course is not our role to decide whether she was truthful or not—that is reserved for the jury. Benoit v. Wilson, 239 S.W.2d 792, 796 (Tex. 1951) (“The jury, not the court, is the fact finding body. The court is never permitted to substitute its findings and conclusions for that of the jury. The jury is the exclusive judge of the facts proved, the credibility of the witnesses and the weight to be given to their testimony.”). Accordingly, the jury was entitled to disbelieve her testimony and not award consortium damages. Perez v. Lopez, 74 S.W.3d 60, 66 (Tex.App.--El Paso 2002, no pet.) (in upholding award of no damages for loss of consortium “it was [the jury’s] function to accept or reject any, part, or all of the witnesses’s testimony ....”).

The trial court also found fault with the jury’s answer to the loss of household services question. An award for household services compensates a family member for the loss of household services that the injured party would have provided the family member but for the injury. See COMM. ON PATTERN JURY CHARGES, STATE BAR OF TEX., TEXAS PATTERN JURY CHARGES: GEN. NEGLIGENCE, PJC 28.4 (2016). The jury question here, however asked for the “[r]easonable value of household services and personal care in the past provided by Andrea Juarez for the benefit of Irma Vanessa Villegas.” There was no evidence that Juarez provided household services to Villegas (as opposed to Villegas providing services to Juarez). While that may have been a typographical error as the real-parties-in-interest suggest, it was the charge given and which the jury answered.

The balance of the trial court’s rationale is that the series of $25,000 awards for past and future physical impairment, and past and future pain and suffering are “neither authorized nor supported by the evidence and is contrary to the great weight of the evidence.” It is unclear if the rationale here is grounded solely in a factual sufficiency challenge or includes legal sufficiency as well. See In re Bent, 487 S.W.3d 170, 179 (Tex. 2016) (noting trial court’s muddled legal- and factual-sufficiency evaluation of the evidence). As a legal insufficiency matter, the argument fails because the evidence could never establish a particular sum for a non-pecuniary award as a matter of law. As a factual insufficiency challenge, the order fails to explain how the particular amounts—given the jury’s wide latitude, shock the conscious or point to an award based on some bias.

For these reasons, I respectfully dissent.

Footnotes

1

We will refer to the plaintiffs collectively as “Villegas” unless context requires us to draw a distinction between them.

2

We note that we have characterized Juarez’s motion for mistrial as a motion for new trial based on the impact of the trial court’s ruling. The title of the motion is immaterial where it ultimately returned the case “to the posture in which it had been before trial[,]” thereby rendering the post-verdict ruling “functionally indistinguishable from an order granting a new trial.” State v. Garza, 774 S.W.2d 724, 726 (Tex.App.—Corpus Christi 1989, pet. ref’d).

3

See Painter v. Amerimex Drilling I, Ltd., 561 S.W.3d 125 (Tex. 2018).

4

On September 13, 2020, Villegas died during the pendency of this appeal.

5

During trial, toxicologists retained by both sides agreed that Ruiz’s blood-alcohol concentration (BAC) was estimated as .02 percent, as shown by later testing, at the time of the impact.

6

Our mandamus record includes “Plaintiff’s Supplemental Petition of January 12, 2018.”

7

For completeness, we detail here the other damages awarded by the jury not otherwise listed above: past medical care of $630,000, and future medical care of $2,500,000; past physical impairment of $25,000, and future physical impairment of $25,000; past loss of earning capacity of $150,000, and future loss of earning capacity of $240,000; past mental anguish of $25,000, and future mental anguish of $25,000.

8

In United Scaffolding, the trial court’s order articulated four reasons—including the impermissible reason “in the interest of justice and fairness”—that were all linked together by the connector “and/or.” Because the use of and/or left open that possibility that “in the interest of justice” was the sole rationale, the Supreme Court of Texas granted mandamus relief, vacated the amended order based on the ambiguity, and outlined further steps the trial court needed to take to make its order facially valid. Id. at 689-90. The United Scaffolding Court identified the following as reasons that would not pass muster under Columbia:

• The reason given is legally invalid.

• The reason plainly stated that the trial court merely substituted its own judgment for the jury’s.

• The reason was that the trial court simply disliked one party’s lawyer.

• The reason was based on invidious discrimination.

• The reason is “rubber-stamped with a valid new-trial rationale” but “provides little or no insight into the judge’s reasoning” (i.e. it involves the “mere recitation of a legal standard” that does not show “the trial judge considered the specific facts and circumstances of the case at hand and explain[ed] how the evidence (or lack of evidence) undermines the jury’s findings”).

• The order provides “no more than a pro forma template ....”

Id. at 689.

9

In Menchaca, a three-justice plurality held that a post-discharge motion for new trial was not sufficient to preserve error; instead, a motion to correct the verdict prior to discharge of the jury was required. 545 S.W.3d at 517-19 (plurality op. by Boyd, J., joined by Lehrmann and Devine, JJ.). Yet, a four-justice plurality held that the failure to object to conflicting answers before the trial court discharged the jury should not prevent appellate courts from reviewing the merits of the conflict. Id. at 526-31 (Green, J., dissenting, joined by Hecht, C.J., and Guzman and Brown, JJ.). Justice Blacklock concurred in the Court’s judgment without opinion, and Justice Johnson did not participate in the decision. Id. at 521. Neither plurality opinion thus commanded the five votes necessary to become binding precedent. See Univ. of Tex. Med. Branch at Galveston v. York, 871 S.W.2d 175, 177 (Tex. 1994) (Texas Supreme Court plurality opinions do not constitute binding authority “[b]ecause the principles of law involved have not been agreed upon by a majority of the sitting court”).

10

Rudolph maintains that Villegas reads too much into Painter II and argues that Painter II does not apply here because it does not deal explicitly with the access doctrine. We agree that Painter II does not explicitly reference the access doctrine itself. However, Painter II does state that the coming-and-going rule applies to both workers’ compensation and vicarious liability cases. Painter II, 561 S.W.3d at 136. In defining a version of the rule, Painter II describes: “a general rule [that] an injury received while using the public streets and highways in going to or returning from the place of employment is not compensable because not incurred in the course of employment.” Id. The coming-and-going rule is ordinarily applied to employee transit occurring on public streets and highways. Painter II dealt with and applied an exception to the coming-and-going rule known as the special mission exception to hold that there was a fact question on vicarious liability in the nonsubscriber context. It would follow that if the Supreme Court of Texas held in Painter II that the coming-and-going rule applies across both the subscriber and nonsubscriber contexts, and that one exception to the rule also applied, then logically speaking, another exception to the coming-and-going rule (the on-premises/access doctrine) could equally apply with force here. Although we find that the general principles enunciated in Painter II applied here, we do not otherwise decide whether there is a need for an access instruction as that issue is not now before us.

1

And a careful examination of the briefing when the case was before our Court would show that the plaintiffs primarily relied on a claimed exception to the coming and going rule carved out for travel to and from drilling rigs in remote locations. 511 S.W.2d at 706, citing, e.g., Johnson v. Pacific Employers Indemnity Co., 439 S.W.2d 824 (Tex.1969). None of those cases, however, would have any application to the accident here.

2

Nothing written here should be interpreted as suggesting that I would agree or disagree with such a ruling. That issue is not before us. I only conclude that a trial court cannot set aside a jury’s verdict in favor of a new trial because the court might grant one party relief as a matter of law, particularly when a motion seeking such relief is already teed up before the trial court.

3

Tragically, during the pendency of this appeal, the real-parties-in-interest informed us that Villegas has passed away.

4

This overlap also distinguishes the principal case that the real-parties-in-interest rely on, Doctor v. Pardue. In that case, the jury awarded no sums for any of the past categories of non-pecuniary loss, but substantial sums for all the future awards. 186 S.W.3d at 18.

Court of Appeals of Texas, El Paso.

CLINICAL PATHOLOGY LABORATORIES, INC., Appellant,

v.

Juan POLO, Appellee.

No. 08-19-00067-CV

|

August 6, 2020

Attorneys & Firms

ATTORNEY FOR APPELLANT: Mark C. Walker, Dickinson Wright, PLLC, 221 N. Kansas St.. Ste. 2000, El Paso, TX 79901.

ATTORNEY FOR APPELLEE: John P. Mobbs, Attorney at Law, 6350 Escondido Drive, Suite A-14, El Paso, TX 79912.

Before Alley, C.J., Rodriguez, and Palafox, JJ.

OPINION

JEFF ALLEY, Chief Justice

*1 Unfortunate as it may be, employees are sometimes fired. And it is hard to imagine that any worker would be discharged from employment without some internal discussion by the employer, whether from manager-to-manager, manager-to-staff, or staff-to-manager, not to mention the actual communication of the termination decision to the discharged employee. In this appeal we are again confronted with the question of whether those types of discussions are “communications” that might invoke the protection of free speech and associational rights under the Texas Citizens Participation Act (“TCPA”). The question is more than academic, because once the TCPA is invoked, the plaintiff is early on put to the task of presenting by clear and specific evidence a prima facie case for each essential element of the claim in question.1 Failure to make that case exposes the employee not only to dismissal of their suit, but attorney’s fees and sanctions.2

The Texas Supreme Court has already decided that some purely internal company discussions can invoke the TCPA.3 But the same court has also cautioned that discussions attendant to a “private contract dispute affecting only the fortunes of the private parties” do not involve a “matter of public concern”--a necessary predicate under the TCPA.4 Because we conclude that the employer in this wrongful discharge case failed to show, by a preponderance of the evidence, that the discussions leading up to the termination of the plaintiff related to a matter of public concern, or that the plaintiff is suing over those discussions as distinct from the termination decision itself, we affirm the trial court’s order declining to apply the TCPA.

I. FACTUAL BACKGROUND

Appellant Clinical Pathologies Laboratories (“CPL”) terminated Appellee Juan Polo (“Polo”) from his employment as a phlebotomist after Polo suffered a work-related injury and filed a worker’s compensation claim. CPL is “a reference laboratory” that performs laboratory testing for its clients, which includes physicians, clinics, and hospitals. Polo was employed by CPL as a phlebotomist and driver from March 13, 2012 until his termination on November 14, 2016. Among other things, phlebotomists are tasked with obtaining blood samples from patients.

*2 On August 22, 2016, Polo was involved in a work-related motor vehicle accident while driving a company vehicle. As Polo was unable to immediately return to work, he filed for and received worker’s compensation benefits. The parties dispute, however, what happened next. According to Polo, his physician released him to perform light duty work on August 30, 2016, with some restrictions on the movement of his ankle. He claims that despite this limitation, he was physically able to perform the essential functions of his job as a phlebotomist, but CPL nevertheless refused to allow him to return to work on light duty. CPL, however, contends that it never received notification that Polo could return to work on light duty, and that instead, it received multiple reports from Polo’s physician indicating that Polo would not be able to return to work for the foreseeable future.

CPL sent a letter to Polo dated November 8, 2016, informing him that it was terminating his employment. In the letter, CPL stated that it had accommodated Polo’s need for time off since his work-related accident, but that this had “placed a hardship on the department,” and that, despite its concern for Polo’s health, CPL could no longer continue to carry him as an employee. The letter further stated that when Polo was fully recovered and released by his physician to return to work, he could reapply for employment with CPL.

II. PROCEDURAL BACKGROUND

A. Polo’s Lawsuit

Polo filed his Original Petition against CPL alleging that it had terminated him in violation of Chapter 451 of the Texas Labor Code. See TEX.LAB.CODE ANN. § 451.001 (a person may not discharge or in any other manner discriminate against an employee who has filed a worker’s compensation claim in good faith). In his petition, Polo also alleged that after he filed the worker’s compensation claim, he was “subjected to a negative attitude” by CPL due to the filing, and that CPL’s management had informed him that “he needed to hurry up and return to work on full release.”

In its answer to the petition, CPL denied that it terminated Polo as the result of the filing of his worker’s compensation claim, asserting instead that its decision to terminate Polo was “induced by business necessity or bona fide occupational qualifications.” CPL further elaborated that its termination decision was based on Polo’s inability to perform the “essential functions of the job,” and that the termination was made “according to a uniform application of a company policy.”

B. The TCPA Motion to Dismiss

CPL thereafter filed its motion to dismiss Polo’s lawsuit pursuant to the TCPA. In its motion, CPL alleged that Polo’s “claims in his suit are based on, related to, or in response to CPL’s exercise of its right of free speech on a matter of public concern, or its right to associate, and are subject to dismissal under the TCPA.” In particular, CPL argued that the “unequivocal language” in Polo’s Original Petition demonstrated that he was complaining about the communications that took place among CPL management or employees, which pertained to, “among other things, Plaintiff’s extended time off, which placed CPL’s phlebotomy department in a hardship,” and caused CPL to be “unable to provide the best service to its clients in the medical community.” Although the record does not contain any of the actual alleged communications, CPL contends that these communications were “made in connection with a matter of public concern,” as defined by the TCPA, i.e., health and safety issues, given CPL’s role in the medical community and Polo’s employment as a phlebotomist.

1. Klein’s affidavit

In support of its motion, CPL attached an affidavit from Debbie Klein, CPL’s Vice-President of Human Resources. In her affidavit, Klein described the several regulations and guidelines that a clinical lab must follow in conducting its operations, and their connection to the health and safety of its customers. She further explained that phlebotomists, such as Polo, are required to understand and follow various regulations and guidelines, and that they are responsible for adhering to “departmental policies and procedures to include departmental programs, quality control, quality assurance, and safety.”

*3 Klein explained that in general, when CPL does not have a fully staffed phlebotomy department, it “risks a loss of services” to the community, and it causes “a delay in diagnosing, preventing, or treating disease which would be harmful to [the] community.” Klein explained that Polo’s inability to return to work as a phlebotomist caused “CPL’s ability to provide health services to suffer,” and it eventually became “economically necessary” to hire a replacement. According to Klein, after CPL received a Texas Workers’ Compensation Work Status Report, dated October 31, 2016, stating that Polo would be unable to return to work until November 30, 2016, CPL called Polo about the situation to determine if his physician would release him to work sooner. But after receiving no response, CPL sent Polo the November 8, 2016 termination letter.

Klein also concluded from a review of Polo’s Original Petition, that his lawsuit was based on communications that CPL employees had with each other and with Polo regarding the decision to terminate him. She also concluded that the claim was related to internal communications CPL’s staff had with each other discussing the “proper management and staffing of a clinical laboratory” and the “provision of services, which CPL offers in the marketplace.” She did not, however, provide the substance of any of those communications, or other details regarding them. In addition, Klein expressed her belief that Polo’s lawsuit related to various communications that CPL and its employees had with “state and federal governments, and among each other, with regard to compliance with [CPL’s] reporting obligations,” and CPL’s need to comply with the various “standards and regulations” imposed upon it to ensure the health and safety of the community. Once again, however, Klein did not provide the substance of any such communications or explain how they related to Polo’s absence from work.

2. Polo’s opposition to the motion and supporting affidavit

Polo opposed CPL’s motion to dismiss, contending that his lawsuit was not based on, related to, or made in response to any of the above-described communications, and was instead based solely on CPL’s purely private acts of allegedly retaliating against him for filing his worker’s compensation claim. He further alleged that CPL’s termination decision was not related to any health or safety concerns, and that it was instead related solely to CPL’s private “economic concerns.” Polo attached his own affidavit in which he averred that he had been released to light duty work in August of 2016, but that CPL had refused to let him return to work, and that its decision to terminate him less than three months later was a “pre-text and a cover up” of CPL’s true intent, which was to retaliate against him for filing his worker’s compensation claim. In addition, Polo alleged that at an unspecified time, CPL’s management had expressed to him that it “did not want people to file worker’s compensation claims as that is a loss of money.”

Following a hearing on the motion, the trial court denied the motion, and this interlocutory appeal follows. In the three issues before us CPL contends that the trial court erred by denying its TCPA motion to dismiss. More specifically, its first issue contends that it met the initial burden of demonstrating that Polo’s lawsuit constituted a legal action that was based on, related to, or in response to CPL’s exercise of its right of free speech on a matter of public concern, or its right to associate. In its second issue, CPL contends that Polo failed to establish a prima facie case on the essential elements of his claim of retaliatory discharge, as required by the TCPA, and in its third issue, CPL argues in the alternative that it established a valid defense to Polo’s claims.

III. APPLICABLE LAW AND STANDARD OF REVIEW

*4 The Legislature passed the TCPA to “encourage and safeguard the constitutional rights of persons to petition, speak freely, associate freely, and otherwise participate in government to the maximum extent permitted by law and, at the same time, protect the rights of a person to file meritorious lawsuits for demonstrable injury.” Pacheco v. Rodriguez, 600 S.W.3d 401, 404 (Tex.App.--El Paso 2020, no pet.) citing TEX.CIV.PRAC.& REM.CODE ANN. § 27.002; see also MVS Int’l Corp. v. Int’l Advert. Sols., LLC, 545 S.W.3d 180, 188 (Tex.App.--El Paso 2017, no pet.). In other words, the TCPA’s “purpose is to identify and summarily dispose of lawsuits designed only to chill First Amendment rights, not to dismiss meritorious lawsuits.” In re Lipsky, 460 S.W.3d 579, 589 (Tex. 2015), citing TEX.CIV.PRAC. & REM.CODE § 27.002.

In determining whether a legal action should be dismissed under the TCPA, the statute requires courts to employ a multi-step decisional process. Under the first step, the trial court must determine if the TCPA applies. In that step, the moving party must show by a preponderance of the evidence that the legal action is based on, relates to, or is in response to the movant’s exercise of: “(A) the right of free speech; (B) the right to petition; or (C) the right of association[.]” TEX.CIV.PRAC. & REM.CODE ANN. § 27.005(b)(1); see also In re Lipsky, 460 S.W.3d at 586. If the movant carries this initial burden, the trial court must then determine whether the non-movant’s claims fall within any statutory exception raised by the non-movant. Pacheco, 600 S.W.3d at 405. The non-movant carries the burden of proving that a statutory exemption applies to his claims. Id., citing Kirkstall Rd. Enterprises, Inc. v. Jones, 523 S.W.3d 251, 253 (Tex.App.--Dallas 2017, no pet.).5

If the movant meets the initial burden of demonstrating that the TCPA applies, and the trial court determines that no exception applies, the burden then shifts to the non-movant to establish “by clear and specific evidence a prima facie case for each essential element of the claim in question.” Pacheco, 600 S.W.3d at 405, citing TEX.CIV.PRAC. & REM.CODE ANN. § 27.005(c); see also Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC, 591 S.W.3d 127, 132 (Tex. 2019) And finally, if the non-movant meets that burden, the movant can still win dismissal if it establishes “by a preponderance of the evidence each essential element of a valid defense to the non-movant’s claim.” Id. at 132, citing TEX.CIV.PRAC. & REM.CODE ANN. § 27.005(d).

We review de novo a trial court’s ruling on a TCPA motion to dismiss. Dallas Morning News, Inc. v. Hall, 579 S.W.3d 370, 377 (Tex. 2019) (Supreme Court conducts a de novo review of a court of appeals’ determination regarding whether the parties met their respective burdens of proof under the TCPA); MVS Int’l Corp., 545 S.W.3d at 189-90 (conducting a de novo review of trial court’s ruling on a TCPA motion). In conducting our review, as mandated by the TCPA, we consider all “pleadings and supporting and opposing affidavits” stating the facts on which the liability or defense is based. Creative Oil & Gas, LLC, 591 S.W.3d at 132, citing TEX.CIV.PRAC. & REM.CODE ANN. § 27.006(a). We further view the pleadings and evidence in the light most favorable to the non-movant in determining whether dismissal under the TCPA is warranted. See Pacheco, 600 S.W.3d at 405, citing MVS Int’l Corp., 545 S.W.3d at 189-90.

*5 To the extent that we need to interpret the statutory language, our objective is to “give effect to the Legislature’s intent, which requires us to first look to the statute’s plain language.” Lippincott v. Whisenhunt, 462 S.W.3d 507, 509 (Tex. 2015) (per curiam). If the statute’s language is unambiguous, “we interpret the statute according to its plain meaning.” Id. And “[w]e presume the Legislature included each word in the statute for a purpose and that words not included were purposefully omitted.” Id.

IV. THE RIGHT OF FREE SPEECH UNDER THE TCPA

We first consider whether Polo’s claim of retaliatory discharge was based on, related to, or made in response to CPL’s right of free speech within the meaning of the TCPA. The exercise of the right of free speech is defined by the TCPA as a “communication made in connection with a matter of public concern.” TEX.CIV.PRAC. & REM.CODE ANN. § 27.001(3). In order to implicate its right of free speech, CPL was therefore required to demonstrate that Polo’s lawsuit alleged any such communications. See Pacheco, 600 S.W.3d at 409, citing Pinghua Lei v. Nat. Polymer Int’l Corp., 578 S.W.3d 706, 712-17 (Tex.App.--Dallas 2019, no pet.); see also Smith v. Crestview NuV, LLC, 565 S.W.3d 793, 798 (Tex.App.--Fort Worth 2018, pet. denied) (recognizing that a claim must “allege a communication” in order to invoke the TCPA).

A broad range of communications, in various mediums, are covered by the TCPA. TEX.CIV.PRAC. & REM.CODE ANN. § 27.001(1) (defining “communication” to include the “making or submitting of a statement or document in any form or medium, including oral, visual, written, audiovisual, or electronic.”); see also Adams v. Starside Custom Builders, LLC, 547 S.W.3d 890, 894 (Tex. 2018) (recognizing that under the TCPA, “[a]lmost every imaginable form of communication, in any medium, is covered.”). Moreover, as the Texas Supreme Court has recognized, even private communications are covered by the TCPA, provided that they were made in connection with matter of “public concern.” See ExxonMobil Pipeline Co. v. Coleman, 512 S.W.3d 895, 901 (Tex. 2017); see also Lippincott, 462 S.W.3d at 509 (recognizing that the “plain language of the statute imposes no requirement that the form of the communication be public.”).

Therefore, our initial task is to determine whether Polo’s lawsuit was based on, related to, or made in response to any “communications” that would invoke the TCPA, or alternatively, whether, his lawsuit was factually predicated on CPL’s decision to terminate him, rendering it outside the TCPA’s scope.

A. Communications or Conduct?

Polo contends that his lawsuit was based solely on CPL’s decision to terminate him in retaliation for filing his worker’s compensation claim. And he argues that the decision was not factually predicated on any specific communications made by CPL. Rather, he urges that at most it was based on conduct, which this and other courts have found to be outside of the scope of “communications” which might trigger the TCPA.6 See Pacheco, 600 S.W.3d at 410 (TCPA did not apply to defendant’s cross-claim alleging negligent conduct); see also Smith, 565 S.W.3d at 798-799 (TCPA was not invoked where plaintiff’s “aider-liability” claims were based solely on conduct and did not allege a communication as defined by the TCPA); Elite Auto Body LLC v. Autocraft Bodywerks, Inc., 520 S.W.3d 191, 207 (Tex.App.--Austin 2017, pet. dism’d) (TCPA did not apply to plaintiff’s claims to the extent that they were predicated factually on conduct by defendant rather than on “communications” as defined by the TCPA).7,8

*6 CPL, on the other hand, contends that Polo’s lawsuit was at the very least related to (1) the communications that took place among CPL’s managers regarding Polo’s absence from work, (2) their communications made in deciding to terminate Polo, and (3) the communications it had with Polo on the subject. In particular, CPL points out that in both his pleadings and his affidavit, Polo contends that the reasons CPL gave for his termination in its November letter were pretextual or false. In addition, CPL points out that Polo alleged that he had other communications, or at the least, interactions, with CPL’s management, claiming that CPL’s management had developed a “negative attitude” toward him after he filed his worker’s compensation claim, had informed him that he “needed to hurry up and return to work on full release,” and that a CPL employee told him that the company disfavored worker’s compensation claims due to the economic costs involved.

In truth, almost every lawsuit at its core is based on some decision, followed by conduct, that is bracketed by communications in one form or another by or between the parties. For instance, a breach of a contract presupposes a decision followed by conduct, which is normally preceded by related emails, demand letters, or person-to-person discussions. A workplace accident may result from an ill-advised decision or action, often preceded by some directive communicated by the employer. And it would be rare for an employee to be discharged without some communication between employer and employee leading up to the termination decision. How then to apply the TCPA to protect free speech without swallowing the whole of tort and contract litigation? We find the answer to that question in two related ideas. First the TCPA itself requires that the movant show by a preponderance of the evidence that the legal action is based on, relates to, or is in response to the movant’s exercise of one the enumerated rights. TEX.CIV.PRAC. & REM.CODE ANN. § 27.005(b); see also In re Lipsky, 460 S.W.3d at 586. Second, the Texas Supreme Court has directed that we undertake a “holistic” review of the record to answer that question. Adams, 547 S.W.3d at 897 (“Moreover, the unique language of the TCPA directs courts to decide its applicability based on a holistic review of the pleadings.”). Viewed with those two ideas in mind, we agree with the trial court that the TCPA does not apply to this suit.

From the record as a whole, it seems clear that the decision to terminate Polo, followed by the act of terminating him are at the core of this lawsuit, as distinct from the several discussions and letters surrounding that decision. CPL could have had all the discussions that it did without exposing itself to Chapter 451 liability if it did not take the last step of actually terminating Polo. And as Polo also argues, the communications at most are “evidence” that the parties will likely present at trial to be used by the trier of fact in determining whether CPL had a retaliatory motive for terminating him, but the lawsuit is not itself factually predicated on them. See In re IntelliCentrics, Inc., No. 02-18-00280-CV, 2018 WL 5289379, at *4 (Tex.App.--Fort Worth Oct. 25, 2018, orig. proceeding) (mem. op., not designated for publication) (recognizing “a distinction between communications used as evidence to support a claim ... and a claim that is ‘based upon, relate[d] to, or [ ] in response to’ that communication under the TCPA.”).9

*7 The easier cases are those where the communication itself causes the harm and triggers liability. In Coleman, for instance, company managers accused a worker of falsely claiming he had filled out a safety related report. Coleman, 512 S.W.3d at 897. The accusation itself, even though made internally within the company, formed the basis of the defamation claim brought by the employee. Id. Similarly, in Lippencott, ostensibly private emails exchanged by hospital staff that accused a nurse practitioner of improper conduct constituted communications within the TCPA. Lippincott, 462 S.W.3d at 509. The substance of the emails formed the basis of the several claims, including defamation. Id.

A more difficult case to reconcile, and the one CPL relies on, is Khalil v. Memorial Hermann Health System, No. H-17-1954, 2017 WL 5068157, at *5 (S.D. Tex. 2017) (unpublished memorandum and order), in which the court determined that the TCPA was implicated in a plaintiff’s age discrimination lawsuit. Id. However, in Kahlil, the plaintiff’s claim of age discrimination was not based solely on her employer’s decision to terminate the plaintiff from her employment but was instead factually predicated on allegedly discriminatory communications the plaintiff claimed led to her termination. In that case, the plaintiff-physician had been employed at the defendant hospital. She initially brought several claims in state court against the hospital, including, defamation, fraud, tortious interference with a contract, and age discrimination. Those claims arose from the hospital employees’ criticism of her performance in various communications. She alleged those communications prevented her from retaining credentials at the hospital, which in turn, led to her termination of her employment at the hospital. Id. at *3, citing Mem’l Hermann Health Sys. v. Khalil, No. 01-16-00512-CV, 2017 WL 3389645, at *18 (Tex.App.--Houston [1st Dist.] Aug. 8, 2017, pet. denied) (mem. op. on rehr’g, not designated for publication). The defendant hospital moved to dismiss all of her state-law claims under the TCPA, with the exception of her age discrimination claim, arguing that those claims were made in response to the exercise of its right to free speech in engaging in the above-described communications. Id. The trial court agreed and granted the defendant’s motion to dismiss, after which the plaintiff’s sole remaining claim of age discrimination was removed to federal court. Id.

In the removed action, the defendant hospital moved to dismiss the age discrimination claim, again contending that it was made in response to its exercise of its right to free speech. Id. at *5. In granting the motion, the court reasoned that the plaintiff’s age discrimination claim was based on the exact same communications criticizing her performance that formed the basis of her state court claims. She alleged that the hospital’s personnel had a discriminatory motive for criticizing her performance, and that those criticisms ultimately led to her termination. Id. at *5. Relying on the same analysis as the state court did with respect to the plaintiff’s other claims, the federal court concluded that the plaintiff’s age discrimination claim was made in response to those communications, and that her claim therefore implicated the defendant’s right to free speech within the meaning of the TCPA. Id.

As we recently recognized in Sec. Serv. Fed. Credit Union v. Rodriguez, No. 08-19-00154-CV, ––– S.W.3d ––––, –––– – ––––, 2020 WL 1969399, at *4-5 (Tex.App.--El Paso Apr. 24, 2020, no pet.), the facts in Khalil were “unique,” and provided an unusual example of how an age discrimination claim could be considered “speech-based.” However, unlike the situation in Khalil, Polo’s claim for retaliatory discharge is not based on any unique set of facts that would render it a “speech-based” claim. As set forth above, Polo did not allege in his pleading that he was harmed by any defamatory or discriminatory statements made by CPL, or that the communications themselves led to his termination; instead, the only harm he alleges stemmed from CPL’s conduct in terminating him after he filed his worker’s compensation claim. At most he claims that the employer exhibited a negative attitude towards him after the injury, but holistically looking at the record, we find no statement or communication that underscores that claim. Stated otherwise, the claim is based on a termination, and not on any particular colloquy from the employer. Accordingly, we conclude that Polo’s lawsuit was factually predicated on CPL’s conduct in terminating him, rather than on any of CPL’s communications, and we therefore conclude that his claim was not based on, related to, or made in response to any communications within the meaning of the TCPA.

B. A Public Concern or a Private Interest?

*8 Moreover, even if we were to agree with CPL that Polo’s lawsuit was, at least indirectly related to the above-described communications, CPL would still have the burden of convincing us that the communications were made “in connection with a matter of public concern.” See Creative Oil & Gas, LLC, 591 S.W.3d at 134, citing TEX.CIV.PRAC. & REM.CODE § 27.001(3) (defining the “exercise of the right of free speech” to mean “a communication made in connection with a matter of public concern.”). Under the former version of the TCPA, which was in effect at the time Polo filed his lawsuit, a “ ‘[m]atter of public concern’ include[d] an issue related to,” among others, “health or safety.”10 Coleman, 512 S.W.3d at 899, citing former TEX.CIV.PRAC. & REM.CODE § 27.001(7).

The Texas Supreme Court has held that in determining whether a communication was made in connection with a matter of public concern, even private communications relating to private disputes may on occasion fit within that category. See Coleman, 512 S.W.3d at 898, 901. However, the Supreme Court more recently cautioned that if a private dispute “affect[s] only the fortunes of the private parties involved,” it is simply not a “ ‘matter of public concern’ under any tenable understanding of those words.” Id. at 137. This Court, as well as many of our sister courts, have recognized this same distinction between matters of public concern (which invoke the TCPA) and matters involving only the parties’ private pecuniary interests (which do not). See, e.g., Ridge Petroleum, Inc. v. Energy Ops, LLC, No. 08-19-00078-CV, ––– S.W.3d ––––, ––––, 2020 WL 1969398, at *9 (Tex.App.--El Paso Apr. 24, 2020, no pet.) (statements referenced in plaintiff’s petition related only to the amount of royalties owed to a private party pursuant to a waste water disposal agreement, and therefore did not relate to a matter of public concern within the meaning of the TCPA.); Gaskamp v. WSP USA, Inc., 596 S.W.3d 457, 476-77 (Tex.App.--Houston [1st Dist.] 2020, pet. filed) (internal communications among parties regarding plaintiff’s trade secrets had no public relevance beyond the pecuniary interests of the private parties, and were therefore not connected to a matter of public concern within the meaning of the TCPA); Tex. Custom Wine Works, LLC v. Talcott, 598 S.W.3d 380, 387 (Tex.App.--Amarillo 2020, no pet.) (“[T]o trigger the TCPA’s protections, [the communication] must involve more than a handful of individuals communicating about a private business deal.”); Forget About It, Inc. v. BioTE Med., LLC, 585 S.W.3d 59, 67-68 (Tex.App.--Dallas 2019, pet. denied) (“a private communication made in connection with a business dispute is not a matter of public concern under the TCPA.”); Caliber Oil & Gas, LLC v. Midland Visions 2000, 591 S.W.3d 226, 239-40 (Tex. App.--Eastland 2019, no pet.) (communications that related only to the “parties’ personal financial well-being,” were not made in connection with a matter of public concern within the meaning of the TCPA); Mathiew v. Subsea 7 (US) LLC, No. 4:17-CV-3140, 2018 WL 1515264, at *4-5 (S.D. Tex. 2018) (communications regarding defendant’s decision to terminate plaintiff, which pertained purely to defendant’s economic interests, were not made in connection with a matter of public concern within the meaning of the TCPA).

*9 In this appeal, CPL contends that its communications about Polo’s absence and its decision to terminate Polo, were made in connection with health or safety issues, thereby making them a matter of public concern within the meaning of the TCPA. In support of its argument, CPL finds it significant that it conducts business in the health care field, providing laboratory services to the public, and that Polo’s position as a phlebotomist was important to CPL’s ability to effectively provide those services. But as the Dallas court recently explained, the mere fact that a defendant operates in the health care field is not sufficient to demonstrate that each and every communication it makes about one of its employees--even those employees who are health care workers--is related to a matter of public concern. See U.S. Anesthesia Partners of Tex., P.A. v. Mahana, 585 S.W.3d 625, 630-31 (Tex.App.--Dallas 2019, pet. denied) (recognizing that a private communication about an employee’s alleged positive drug test or addiction was not a matter of public concern “merely because the employee happens to be a nurse”). To construe the TCPA otherwise to “denote that all private business discussions are a ‘matter of public concern’ if the business ... is related to health or safety is a potentially absurd result that was not contemplated by the Legislature.” Erdner v. Highland Park Emergency Ctr., LLC, 580 S.W.3d 269, 277 (Tex.App.--Dallas 2019, pet. denied). Instead, the focus must be on the communications themselves, and whether they were made in connection with a health or safety issue. Mahana, 585 S.W.3d at 630-31. In other words, the “communications do not become a matter of public concern simply based on the nature of the parties’ business,” and instead, the communications themselves must have “some relevance to issues beyond the interests of the parties” to be considered matters of public concern under the TCPA. See Blue Gold Energy Barstow, LLC v. Precision Frac, LLC, No. 11-19-00238-CV, 2020 WL 1809193, at *7 (Tex.App.--Eastland Apr. 9, 2020, no pet.) (mem. op., not designated for publication); Staff Care, Inc. v. Eskridge Enters., LLC, No. 05-18-00732-CV, 2019 WL 2121116, at *4 (Tex.App.--Dallas May 15, 2019, no pet.) (mem. op., not designated for publication) (to determine whether the TCPA applies, a court “must look to the content of the communications themselves and not focus solely on the occupation of the speaker or the related industry”); see also Goldberg v. EMR (USA Holdings) Inc., 594 S.W.3d 818, 828 (Tex.App.--Dallas 2020, pet. denied) (court must focus on the communication itself to determine whether it was made in connection with a matter of public concern or whether it was “simply a communication between private parties of matters of purely private concern.”).

No doubt, when a health-care operator engages in communications relevant to an employee’s ability to safely and competently provide medical services to patients, courts have held that these communications relate to health and safety issues impacting the public, and can be considered a matter of public concern within the meaning of the TCPA. See, e.g., Lippincott, 462 S.W.3d at 509-10 (defendant’s communications relating to plaintiff’s ability to provide services to patients as a nurse anesthetist without endangering their health involved a matter of public concern); see also Pisharodi v. Columbia Valley Healthcare Sys., L.P., No. 13-18-00364-CV, ––– S.W.3d ––––, ––––, 2020 WL 2213951, at *3 (Tex.App.--Corpus Christi May 7, 2020, no pet. h.) (when a defendant’s communications center on the plaintiff’s “ability to provide competent medical services,” the communications can be said to impact a matter of public concern); Batra v. Covenant Health Sys., 562 S.W.3d 696, 709 (Tex.App.--Amarillo 2018, pet. denied) (private communications relating to a physician’s “handling of specific cases, his medical competence, and disciplinary action” were “matters of public concern”); Khalil, 2017 WL 5068157, at *5-6 (communications criticizing the plaintiff-physician’s competence related to health and safety issues and was therefore made in connection with a matter of public concern).

But here, we simply disagree that CPL has shown its communications regarding Polo’s absence from his employment as a phlebotomist similarly focused on a public health concern as distinct from the parties’ private employment dispute. First, other than the termination notice, none of the alleged communications appear in our record. Without being able to review the communications, we are unable to determine whether any of CPL’s communications did in fact relate to public health or safety issues, or whether they were instead merely related to CPL’s concern about how Polo’s absence was affecting its business operations and its own pecuniary interests. See Staff Care, Inc., 2019 WL 2121116, at n.3 (recognizing that without knowing its content, “a court cannot determine whether the alleged communication falls under the statutory definitions of the TCPA”); see also Gaskamp, 596 S.W.3d at 477-78 (record did not contain sufficient information from which it could be determined that plaintiff’s lawsuit involved protected communications).

*10 Nor is there any objective indication that a public health or safety concern actually factored into CPL’s consideration to any significant degree. Nothing informs us, for instance, whether Polo was one of only a few phlebotomists such that his individual absence would meaningfully impact the community, or whether he was only one of a much larger group, where the health and safety impact of his loss would be no more than with any employee’s departure. The record is replete, however, with references to CPL’s concern with the financial impact Polo’s absence was causing. For example, in the termination notice itself--which is the only communication that we have in the record--CPL stated that Polo’s absence was causing a “hardship” on the phlebotomy department, but made no mention of how the public may have been impacted by his absence. In addition, in its answer to Polo’s petition, CPL stated that its decision to terminate Polo was “induced by business necessity,” again making no mention of any concerns it had about the public’s health or safety. And finally, in her affidavit, Klein averred that Polo’s absence from his job had impacted the “work demands” at CPL’s El Paso location, and that it had therefore become “economically necessary to hire a replacement for Mr. Polo.” While Klein did opine that being understaffed posed a “risk of loss of services to [the] community” and could have caused a “delay in diagnosing, preventing, or treating disease which would be harmful to [the] community,” she couched this opinion in theoretical terms, and she failed to describe any communications that CPL managers had discussing how Polo’s absence was impacting the public or patient safety.

Accordingly, we conclude that CPL failed to meet its burden of demonstrating that it engaged in any communications that could be considered a matter of public concern regarding Polo’s termination within the meaning of the TCPA. And, in turn, we therefore conclude that CPL has failed to establish that Polo’s wrongful termination lawsuit was based on, related to, or made in response to CPL’s exercise of its right of free speech.

V. THE RIGHT TO ASSOCIATE UNDER THE TCPA

We next consider CPL’s argument that Polo’s lawsuit was based on, related to, or made in response to CPL’s exercise of its right to associate within the meaning of the TCPA. The TCPA, as it existed when Polo filed his lawsuit, defined the “[e]xercise of the right of association” as “a communication between individuals who join together to collectively express, promote, pursue, or defend common interests.” Act of May 18, 2011, 82nd Leg. R.S., ch. 341, 2011 TEX.GEN.LAWS 961, 963 (amended 2019) (current version at TEX.CIV.PRAC. & REM.CODE § 27.009(a)(1)-(2)). Here, CPL contends that its managers joined together, within the meaning of the TCPA’s right to associate, for the “same interest” of “keeping the phlebotomy services available to the public, and ensuring that Mr. Polo could provide those services.”

As Polo points out, however, CPL once again provides little information about the identity of these managers or the content of these communications. Moreover, we have difficulty concluding that CPL’s managers, who were already associated with each other as employees of an ongoing business, could be said to have “join[ed] together” for the purpose of communicating about Polo’s employment, within the meaning of the TCPA’s right to associate provision. See generally Tervita, LLC v. Sutterfield, 482 S.W.3d 280, 287 (Tex.App.--Dallas 2015, pet. denied) (concluding that the TCPA’s right to associate provision was not implicated where the company’s managers exchanged private, internal communications regarding the plaintiff’s employment). More importantly, we disagree with CPL’s argument that it was not required to establish that its managers joined together for a “public purpose” in order to invoke the TCPA’s right to associate, and that the right to associate could be implicated where the managers joined together for a “private purpose,” as long as they were otherwise “pursuing a common interest.”

The former version of the TCPA did not expressly impose a requirement that the “common interest” element of the right to associate had to relate to a public concern or purpose. TEX.CIV.PRAC. & REM.CODE § 27.001(2). Yet several courts that have directly addressed the issue conclude that the TCPA’s right to associate provision may not be read so broadly. See, e.g., Kawcak v. Antero Res. Corp., 582 S.W.3d 566, 581, 588 (Tex.App.--Fort Worth 2019, pet. denied) (holding that the definition of “ ‘the right of association’ requires more than two tortfeasors conspiring to act tortiously for their own selfish benefit”); see also Dyer v. Medoc Health Services, LLC, 573 S.W.3d 418, 426-27 (Tex.App.--Dallas 2019, pet. denied) (“to constitute an exercise of the right of association under the [TCPA], the nature of the ‘communication between individuals who join together’ must involve public or citizen’s participation.”); Tex. Custom Wine Works, LLC, 598 S.W.3d at 388 (concluding that the TCPA’s right to associate provision did not apply to plaintiff’s claims for fraud, promissory estoppel, and breach of fiduciary duty where there were no communications about an issue of public concern, and the only interests at stake were the parties’ private interests). As these courts recognize, allowing a defendant to seek dismissal of a lawsuit under the TCPA by arguing that he had the right to associate on a matter relating solely to his own personal interests, does nothing to further the TCPA’s stated purpose of eliminating lawsuits designed to suppress the defendant’s exercise of his constitutional rights while maintaining a plaintiff’s right to bring a meritorious suit for damages. See BusPatrol Am., LLC v. Am. Traffic Sols., Inc., No. 05-18-00920-CV, 2020 WL 1430357, at *8 (Tex.App.--Dallas Mar. 24, 2020, no pet.) (mem. op., not designated for publication) (“Construing the TCPA to find a right of association simply because there are communications between parties with a shared interest in a private business transaction does not further the TCPA’s purpose to curb strategic lawsuits against public participation.”); Kawcak, 582 S.W.3d at 573 (recognizing that the definition of “common interests” in the TCPA’s “right to associate” provision should be read in harmony with the Act’s stated purpose, and that a common interest must therefore have “group, community, or public attributes”). For the same reasons we find that the claims here are essentially a private dispute over a private matter. We similarly conclude that no public purpose associational interests are implicated.

*11 Accordingly, we overrule Issue One. Because we resolve the case based on the first issue, finding that the TCPA does not apply to Polo’s retaliatory discharge claim, we need not discuss CPL’s remaining two issues. See Chandni I, Inc. v. Patel, 601 S.W.3d 13 (Tex.App.--El Paso 2019, pet. denied) (where appellants did not meet their burden of showing that the TCPA applied to appellee’s claim, court need not address issues of whether appellee established a prima facie case for his claim or whether appellants had a valid defense to the claim); see also Pacheco, 600 S.W.3d at 411 (same).

VI. CONCLUSION

Because we conclude that CPL has failed to establish that the TCPA applies to Polo’s lawsuit, we need not address the other issues raised by the parties. We therefore affirm the trial court’s judgment denying CPL’s motion to dismiss and remand this matter to the trial court for further proceedings.

Footnotes

1

TEX.CIV.PRAC. & REM.CODE ANN. § 27.005(c).

2

The applicable provision of the TCPA here provided that if “the court orders dismissal of a legal action” it “shall award to the moving party” both “(1) court costs, reasonable attorney’s fees, and other expenses incurred in defending against the legal action” and “(2) sanctions ... sufficient to deter” against “bringing similar actions.” Act of May 18, 2011, 82nd Leg., R.S., ch. 341, § 2, 2011 TEX.GEN.LAWS 961, 963 (amended 2019) (current version at TEX.CIV.PRAC. & REM.CODE ANN. § 27.009(a)(1)-(2)).

3

ExxonMobil Pipeline Co. v. Coleman, 512 S.W.3d 895, 899 (Tex. 2017) (per curiam).

4

Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC, 591 S.W.3d 127, 137 (Tex. 2019) (“A private contract dispute affecting only the fortunes of the private parties involved is simply not a ‘matter of public concern’ under any tenable understanding of those words.”).

5

Among others, the TCPA exempts from its application, “a legal action brought under the Insurance Code or arising out of an insurance contract.” TEX.CIV.PRAC. & REM.CODE ANN. § 27.010(a)(4). Polo contends that his claim arises out of an insurance contract, i.e., CPL’s agreement to provide him with worker’s compensation coverage, and that his claim was therefore exempted from the TCPA’s application under this statutory exception. Based on our resolution of the case we need not address this issue.

6

CPL contends that we should not consider this argument on appeal, as Polo did not make this same argument in the trial court. We disagree. Polo made this general argument in his response to CPL’s motion to dismiss, when he asserted that his lawsuit was not based on any communications made by CPL, and that it was instead based on CPL’s action in terminating him. At most, Polo has elaborated on this argument in his brief on appeal by citing to additional case law and authorities. See Adams, 547 S.W.3d 890, 896-97, citing Greene v. Farmers Ins. Exchange, 446 S.W.3d 761, 764 n.4 (Tex. 2014) (“We do not consider issues that were not raised in the courts below, but parties are free to construct new arguments in support of issues properly before the Court.”) Moreover, because an appellate court must decide on a de novo basis whether the TCPA applies, our focus must be on whether, as a matter of law, the TCPA applies to Polo’s lawsuit, and we must therefore not “cabin[ ] our TCPA analysis to the precise legal arguments or record references” made by the parties in the trial court, and we must instead decide the applicability of the TCPA based on a “holistic review” of the pleadings and evidence presented in the trial court. Adams, 547 S.W. 3d at 897.

7

We recognize that some expressive conduct may constitute speech, but that is not claimed to be the case here. See, e.g., Texas v. Johnson, 491 U.S. 397, 403, 109 S.Ct. 2533, 105 L.Ed.2d 342 (1989) (burning the U.S. flag constituted expressive conduct invoking the First Amendment); Ex parte Thompson, 442 S.W.3d 325, 336 (Tex. Crim. App. 2014) (photographing others can be inherently expressive conduct protected by First Amendment).

8

CPL, however, disagrees with the general statement that conduct is not protected, citing cases in which courts have used the term “protected conduct” when discussing whether a defendant was exercising the right to free speech or association within the meaning of the TCPA. These cases, however, use the term “protected conduct” in collectively describing the three rights listed in the TCPA (rights of free speech, association, and petition). But even under these cases, a court still has must identify the existence of a “communication” before a court can find that those rights were implicated by the TCPA. See, e.g., Grant v. Pivot Tech. Sols., Ltd., 556 S.W.3d 865, 872 (Tex.App.--Austin 2018, pet. denied) (recognizing that the term “communication” is a “component of all three forms of protected conduct under the TCPA.”); see also Coleman, 512 S.W.3d at 901 (plaintiff’s claims for defamation and other related claims asserted challenges to statements made by his employer, which constituted “speech the Legislature intended to safeguard through the TCPA.”); Cavin v. Abbott, 545 S.W.3d 47, 61 (Tex.App.--Austin 2017, no pet.) (plaintiff’s claim for defamation and other related claims were admittedly based on statements that would qualify as “communications” under the TCPA). As such, none of the cases cited by CPL alter our opinion that CPL was required to point to a communication to support its claim that the TCPA applies to Polo’s lawsuit.

9

See also Park v. Bd. of Trustees of California State Univ., 217 Cal.Rptr.3d 130, 393 P.3d 905, 906-07, 911 (2017) (holding that a plaintiff’s claim may be struck under California’s anti-SLAPP statute “only if the speech or petitioning activity itself is the wrong complained of, and not just evidence of liability or a step leading to some different act for which liability is asserted ... [W]hile discrimination may be carried out by means of speech, such as a written notice of termination, and an illicit animus may be evidenced by speech, neither circumstance transforms a discrimination suit to one arising from speech.”).

10

In the amended act, which would not apply to this case, a “matter of public concern” is redefined to constitute a statement or activity regarding: “(A) a public official, public figure, or other person who has drawn substantial public attention due to the person’s official acts, fame, notoriety, or celebrity; (B) a matter of political, social, or other interest to the community; or (C) a subject of concern to the public.” TEX.CIV.PRAC. & REM.CODE ANN. § 27.001(7).

Court of Appeals of Texas, El Paso.

WTX FUND, LLC, Appellant,

v.

Ray Holt BROWN, Jay F. Holt, Cheryl Jones, Judy Brown Wadsworth, Janie H. Giddiens as Trustee of the Janie H. Giddiens Trust, Debra Lynn Morgan as Trustee of the Debra Lynn Morgan Revocable Trust, Susan G. Wesson as Trustee of the Susan G. Wesson Revocable Living Trust, Patti Holt Elkins, Bobby Van Holt as Trustee of the Bobby Van Holt Revocable Living Trust, and John Thomas Holt, Appellees.

No. 08-17-00104-CV

|

January 8, 2020

*289 Appeal from the 112th District Court of Reagan County, Texas (TC #1913), The Honorable Pedro (Pete) Gomez Jr., Judge

Attorneys & Firms

ATTORNEY FOR APPELLANT, Robert Vartabedian, Thompson & Knight LLP, 777 Main Street, Ste. 3300, Fort Worth, TX 76102.

ATTORNEY FOR APPELLEES, Jane M. N. Webre, Scott, Douglass & McConnico, LLP, 303 Colorado St., Suite 2400, Austin, TX 78701.

Before McClure, C.J. (Senior Judge), sitting by assignment

OPINION

GINA M. PALAFOX, Justice

In this appeal, we are asked to interpret a 1951 mineral deed to determine whether grantors conveyed their entire mineral interest without reservation, or instead, reserved from the conveyance at least one incident of mineral ownership—the royalty interest—either in whole or in fractional share. Appellant WTX Fund, LLC (WTX), the successor-in-interest to the grantors’ heirs, appeals the trial court’s rulings on cross motions for summary judgment. WTX asserts the trial court erred in granting judgment in favor of the heirs of grantee J.F. Holt—namely, Appellees Ray Holt Brown, Jay F. Holt, Cheryl Jones, Judy Brown Wadsworth, Janie H. Giddiens as Trustee of the Janie H. Giddiens Trust, Debra Lynn Morgan as Trustee of the Debra Lynn Morgan Revocable Trust, Susan G. Wesson as Trustee of the Susan G. Wesson Revocable Living Trust, Patti Holt Elkins, Bobby Van Holt as Trustee of the Bobby Van Holt Revocable Living Trust, and John Thomas Holt (collectively, the Holt heirs). Because we construe the 1951 deed as expressly excluding grantors’ royalty right in its entirety from the conveyance, we reverse the trial court’s judgment and render partial judgment in favor of WTX. Additionally, we remand the cause to the trial court for reconsideration of WTX’s remedy and to consider an award of attorney’s fees, if any.

BACKGROUND

On October 18, 1951, Hamilton S. Roach and his wife, Billie Roach (grantors), signed a deed titled, “MINERAL CONVEYANCE,” (the deed or 1951 deed), which conveyed to J.F. Holt and his heirs and assigns, grantors’ rights, title, interest and estate to certain rights to oil, gas, and other minerals in and under described land in Reagan County, Texas. The land was more particularly described in the instrument as “Survey 114, Block 2, T & P Ry Company, Certificate No. 1/226.” By use of a multi-clause structure, the deed expressly lists the rights being conveyed, followed by expanded details, and then concludes with a final paragraph of further substance.

Two years prior to signing the 1951 deed, grantors had granted two separate royalty deeds to O.L. Johnson, for a total undivided share of the size of 201.56/643.12, with each deed setting a primary term of twenty years and continuing thereafter for as long as oil, gas or other minerals were produced on the property.1 *290 With each of the Johnson royalty deeds, grantors expressly retained all other non-royalty rights to include their executive or leasing rights. Notably, the reservation of the executive right provided that any future leases must “provide for at least a royalty on oil of the usual one-eighth[.]”

On the same day of the signing of the 1951 deed, Hamilton and Billie Roach joined with J.F. Holt and his wife, Ella Holt, and, together, the two couples signed an Oil, Gas and Mineral Lease with S.L. Parham (lessee) pertaining to “[t]he East Half of Section 114, Block 2, T. & P. Ry. Co. Survey.” The Parham lease provided for a 1/8 royalty to be paid to lessors and oil payments up to the cumulative amount of $128,664. Of note, the lease also stipulated that “[i]t is agreed and understood that the bonus for this lease, and all royalties, rentals and other payments provided for herein are to be paid to J.F. Holt, his heirs, successors and assigns.” In addition to the 1/8 royalty, the lease provided for a production payment based on oil and gas production up to a cumulative cap.2 The Parham lease provided for a primary term of ten years and continued thereafter as long as oil, gas or other minerals were produced from the land. At present date, the parties agree that the Parham lease has since terminated and is no longer in effect. Instead, the property is currently held by new leases which provide for different terms and royalty rates. One such lease is held by Laredo Petroleum3 while the other is held by Pioneer Natural Resources, USA (Pioneer). The Pioneer lease provides for a 1/6 royalty, while the Laredo lease provides for a 1/4 royalty.

Trial Court Proceedings

In 2015, Pioneer filed an interpleader action in the 112th District Court of Reagan County, Texas, pursuant to Rule 43 of the Texas Rules of Civil Procedure. Pioneer owned and operated various oil and gas properties in Reagan County on which it explored for oil and gas deposits. As a well operator, Pioneer described that it ordinarily paid proceeds to royalty owners. Pioneer was then paying royalties to ten distinct payees pertaining to land situated at SE/4 of Sec 114, Block 2, T&P Ry Co. Survey, Reagan County, Texas. Pioneer described that it had since received notice from WTX informing Pioneer that it was disputing its payment of royalties for proceeds derived from the described property. *291 To avoid multiple liability on the same debt, Pioneer filed the interpleader action against all payees who were then asserting competing royalty interests. Pioneer named WTX and the Holt heirs among the parties whom it listed as contesting royalty payments owed by Pioneer. Pioneer also made an unqualified tender of disputed funds with its interpleader action.

Responding, WTX filed not only a general denial of the action but also a crossclaim and counterclaim against all other parties. Against Pioneer, WTX asserted violations of the Texas Natural Resources Code based on nonpayment of oil and gas proceeds and other interests.4 Against all parties, WTX asserted an action for a declaratory judgment seeking relief from the uncertainty and insecurity regarding the parties’ respective rights, status, and other legal relationships. WTX requested a declaration that the 1951 deed neither conveyed the mineral estate in whole nor the royalty interest owned by the grantors. WTX asserted that only leasing rights, bonuses, and delay rentals were conveyed from grantors Hamilton and Billie Roach to grantee J.F. Holt. WTX described that it became a successor-in-interest in 2015 to the grantors’ reserved interest by way of a conveyance and assignment of a mineral-and-royalty interest from Y-Royalty Partners, LLC (Y-Royalty).5

Among its claims, WTX asserted it informed Pioneer by letter that it owned a royalty interest that it had acquired from Y-Royalty, who had obtained its interest through a series of conveyances from the heirs of Hamilton and Billie Roach, grantors of the 1951 deed. WTX further described that its interest was based on the royalty rate that was provided for in the existing oil and gas lease(s), as opposed to the fixed 1/8 interest stated in the 1951 deed. WTX further described that the lease providing a 1/8 royalty that was in effect at the time of the 1951 deed had since terminated, and a new lease with a 1/6 royalty was currently in effect. WTX claimed that Pioneer had incorrectly credited the Holt heirs with owning title to the royalty interest of the subject property. WTX sought a declaratory judgment to determine the respective rights as between WTX and the Holt heirs, and to recover monetary relief and other damages.

Eventually, after arrangements were made for Pioneer to make regular deposits into the registry of the court, the parties dismissed Pioneer by agreement. With Pioneer dismissed, the controversy over royalty payments proceeded as between WTX, as successor-in-interest of grantors, and the Holt heirs, as successors-in-interest of grantee. Thereafter, WTX filed a motion for partial summary judgment. WTX characterized the claim as a dispute as to (1) whether the 1951 deed conveyed only leasing rights, bonuses and delay rentals, and accordingly, the grantors retained the full royalty interest; or (2) whether the deed conveyed the full mineral estate, including the royalty interest, such that grantors reserved no interest of the mineral estate. WTX asserted in its motion that its present interest was based on the royalty rate in the existing oil and gas lease(s), rather than a fixed 1/8. In support of its motion, WTX relied on the 1951 deed and other documents to show it *292 had acquired its interest from a series of transactions tracing back to the grantors of the 1951 deed.6

Like WTX, the Holt heirs also filed a motion for partial summary judgment. By their motion, the heirs asserted that WTX was attempting to divest them of the royalty interest conveyed in whole to their predecessors-in-interest by the 1951 deed. The Holt heirs asserted the deed conveyed all mineral rights in and under the land to J.F. Holt, and his heirs and assigns.

The Trial Court’s Decision

The trial court agreed with the Holt heirs that the 1951 deed conveyed all of grantors’ mineral interests—including the royalty interest—to grantee J.F. Holt. Accordingly, the trial court entered final judgment incorporating its earlier order granting a partial summary judgment in favor of the Holt heirs and contemporaneously denying WTX’s cross motion for summary judgment. The trial court also ordered that WTX pay the Holt heirs damages for the recovery of improperly received royalties in the amount of $93,309.22, attorney’s fees and costs in the amount of $80,000, and, further, the court made provision for additional attorney’s fees in the event of later appeals. The trial court also entered further orders pertaining to the release of interpleaded funds and related fees charged for the interpleader suit. Lastly, the trial court ordered pre-and post-judgment interest in accordance with the law. Following entry of the judgment, WTX timely filed this appeal.

DISCUSSION

In a single issue, WTX broadly asserts that the trial court erred in denying its motion for partial summary judgment and in granting the cross motion of the Holt heirs. WTX asserts the trial court erred by declaring that the 1951 deed conveyed all of grantors’ mineral interest including the royalty interest. WTX argues the deed reserved grantors’ non-participating royalty interest while conveying all other attributes of their mineral estate. Correlated with its primary argument, WTX further argues that the trial court erred in awarding attorney’s fees to the Holt heirs. Countering, the Holt heirs assert the trial court properly granted judgment in their favor by construing the deed as conveying grantors’ entire undivided mineral interest (including royalty).

We address the arguments in turn.

Standard of Review

We review a summary judgment de novo. Texas Workers’ Compensation Com’n v. Patient Advocates of Texas, 136 S.W.3d 643, 648 (Tex. 2004).

Principles of Deed Construction

To determine whether the trial court erred in its interpretation of the 1951 *293 deed, the first issue we address is whether the deed is ambiguous. Although neither party asserts the deed is ambiguous, both parties clearly diverge on its proper interpretation. Ambiguity is a question of law for the court. ConocoPhillips, 547 S.W.3d at 874.

The construction of an unambiguous deed is reviewed as a question of law. Luckel, 819 S.W.2d at 462).

More recently, in a case of a will dispute that necessarily involved the construction of a mineral deed, the Texas Supreme Court reaffirmed that courts must employ a holistic approach aimed at ascertaining intent from all words and all parts of the conveying instrument. Id.

Mineral Interest Ownership, Conveyance & Reservation

An instrument conveying land in fee simple transfers both the surface *294 estate and all minerals and mineral rights, unless the instrument contains a reservation or expresses a contrary intention. Schlittler, 101 S.W.2d at 544.

The 1951 Deed

As a threshold matter, we agree that the deed is not ambiguous. Nonetheless, despite an absence of ambiguity, questions of interpretation arise in part due to the deed’s structure—where mineral interests are listed individually—and in part due to the deed’s use of the phrase “shall not affect” and the term “benefits.” Given the deed’s structure, we consider each clause in turn; but ultimately, as required by controlling authority, we approach the deed holistically taking care to harmonize and give effect to all provisions so that none will be rendered meaningless. See Luckel, 819 S.W.2d at 462.

With the deed’s opening lines, Hamilton S. Roach and Billie Roach (grantors) acknowledge receipt of consideration paid by J.F. Holt (grantee). Immediately thereafter, the granting clause provides as follows:

Have bargained, sold, released, transferred, assigned and quitclaimed and do by these presents bargain, sell, release, transfer, assign and quitclaim unto [grantee] ... his heirs and assigns, ... all of grantors’ right, title, interest and estate in and to the leasing rights, bonuses and delay rentals in and to all the oil, gas and other minerals in and under the following described land in Reagan County, Texas, to wit: Survey 114, Block 2, T & P Ry Company, Certificate[.] (Emphasis added).

First, the grantors conveyed “all of grantors’ right, title, interest and estate in and to the leasing rights[.]” Second and third, grantors also conveyed their ownership interest in “bonuses and delay rentals in and to all the oil, gas and other minerals in and under” the described property which may be due under any leases.

By naming all three interests individually—the leasing rights, bonuses and delay rentals—the grantors conveyed each of these attributes. Geodyne Energy Income Prod. P’ship I-E v. Newton Corp., 161 S.W.3d 482, 486 (Tex. 2005) (“A warranty deed to land conveys property; a quitclaim deed conveys the grantor’s rights in that property, if any.”).

Next, the deed’s intended clause provides further explanation of the grantors’ intent. We address this clause in three parts given its length. The beginning portion provides:

It is intended by this conveyance to give to the grantee, his heirs and assigns, the right to control and execute all oil and gas leases now on said property or which may be made thereon in the future without the necessity of grantors, heirs or assigns, joining in the execution of the same[.] (Emphasis added).

We note the phrase, “the right to control and execute all oil and gas leases now on said property or which may be made thereon in the future,” confirms the conveyance of leasing rights with further details provided. See Lesley, 352 S.W.3d at 487 (“The executive right is the right to make decisions affecting the exploration and development of the mineral estate[.]”). No dispute arises from the parties about this portion of the deed’s language.

Turning to the middle portion of the intended clause, the following is provided:

[G]rantee ... [is] hereby given the right to collect any and all bonuses and benefits on any future oil and gas leases and any and all delay rentals on all oil and gas leases now upon said property or which may hereafter be made by grantee, his heirs or assigns, thereon[.] (Emphasis added).

We note here the deed’s language moves beyond the executive right to further describe the right to collect any and all bonus and delay rentals with reference to certain time periods. Notably, the clause also includes the term “benefits” after describing *296 bonuses on future oil and gas leases. Because “benefits” also appears in the remaining portion of the clause, we first set forth that portion before giving further consideration of this disputed term.

The intended clause concludes as follows:

[I]t being intended hereby to convey to grantee, his heirs and assigns, all of grantors’ right, title, interest and estate in and to the 7/8 leasing rights or working interest in the oil, gas and minerals in and under said land together with all bonuses, delay rentals, oil payments and all other rights and benefits which may be provided for in any oil and gas leases which grantee, heirs and assigns, have or may hereafter execute upon the above mentioned property, together with the right of ingress and egress at all times for the purpose of enforcing his rights thereunder[.] (Emphasis added).

With both the middle and last portion of the clause, the deed’s language adds two important details about the nature of the conveyance.

First, leasing rights are described as “7/8 leasing rights or working interest in the oil, gas and minerals in and under said land[.]” A “working interest” is “an operating interest under an oil and gas lease that bears all the costs of production and is held subject to the payment of royalties.” Hysaw, 483 S.W.3d at 13. Recognizing that the working interest is held subject to the payment of royalties, the fractional descriptor appearing before “leasing rights” reflects the true nature of the working interest.

A one-eighth royalty was commonplace in the general era in which the deed was executed. See Id. at 76. Given the standard 1/8 royalty, we see no conflict with the granting clause’s conveyance of the leasing rights in their entirety followed by the description of “7/8 leasing rights,” where the deed further describes the conveyance of the working interest.

Second, the right of development is explicitly mentioned for the first time by use of the terms “ingress and egress.” See 896 S.W.2d 795 (Tex. 1995). Adding to the substance, the intended clause further clarifies that grantors conveyed their right of development to the grantee.

At this point, we reach the shall-not-affect-clause, which provides as follows:

It is understood and agreed, however, that this conveyance shall not affect any interest which any grantors, heirs or assigns, have or may have in the future to the non-participating 1/8th royalty in and under said land, but it shall never be necessary for grantors, heirs or *297 assigns, to join in the execution of any instrument pertaining to any past or future oil and gas leases and the grantors, heirs or assigns, shall have no right to any bonuses, delay rentals, oil payments or other benefits under any oil, gas and mineral leases which have been made or which may hereafter be made by grantee, his heirs or assigns, upon said property. (Emphasis added).

Having reached the last of the deed’s clauses, we arrive at the parties’ sharpest points of contention—namely, the meaning of the phrase “shall not affect” and the use of the term “benefits.”

Shall Not Affect Clause

The Holt heirs dismiss the “shall not affect” clause asserting it is unclear and ineffective to operate as a reservation of a non-participatory royalty in favor of grantors. First, the heirs contend the phrase “shall not affect” is not reflective of typical words of reservation comparable to “save and except” or “there is reserved and excepted.” We disagree. By its ordinary meaning, “affect,” is defined as “to act on.” Affect, WEBSTER’S NEW UNIVERSAL UNABRIDGED DICTIONARY (2003). By including “shall not affect,” grantors particularly described by mandatory language that the conveyance did not act on their particularly described ownership rights. Additionally, it is well settled that a grantor may reserve minerals or mineral rights to include a reservation of “royalties, bonuses, and rentals, either one, more or all.” See Luckel, 819 S.W.2d at 463-64.

Second, the heirs contend the language may be construed not as a reservation but as a “subject to” clause protecting grantors from warranties owed to O.L. Johnson—holder of the partial royalty interest conveyed by the 1949 term deeds. Again, however, we are not persuaded. The term “subject to,” when used in a mineral deed, has a well-recognized meaning. Geodyne Energy, 161 S.W.3d at 487 (“a quitclaim deed without warranty of title cannot be a warranty (or ‘misrepresentation’) of title”). Accordingly, we find that the Holt heirs fundamentally mischaracterize the nature and meaning of the shall not affect clause.

In plain terms, the phrase, “this conveyance shall not affect,” evidences a reservation or exception of “any interest which any grantors, heirs or assigns, have or may have” of “the non-participating 1/8th royalty in and under said land[.]” See Hysaw, 483 S.W.3d at 9.

“In and other said land,” refers to the grantors’ interest in Survey 114, or the property mentioned earlier in the deed’s legal description. “Said” is commonly defined as “named or mentioned before.” Said, WEBSTER’S NEW UNIVERSAL UNABRIDGED DICTIONARY (2003). The phrase, “have or may have in the future,” reflects that the reserved interest is tied to any current leases but also extends to future leases that could later come into effect. Because a reservation must always be in favor of and for the benefit of a grantor, the phrase “have or may have in the future” is consistent with a reservation of royalty for grantors and not for a third party. See Pich v. Lankford, 157 Tex. 335, 302 S.W.2d 645, 650 (1957). Thus, the phrase “non-participating 1/8th royalty in and under said land,” provides a clear and distinct description of the nature of the interest reserved or excepted.

The second half of the “shall not affect” clause provides further clarification that “it shall never be necessary for grantors, heirs or assigns, to join in the execution of any instrument pertaining to any past or future oil and gas leases and the grantors, heirs or assigns, shall have no right to any bonuses, delay rentals, oil payments or other benefits under any oil, gas and mineral leases which have been made or which may hereafter be made by grantee, his heirs or assigns, upon said property.” By this language, the clause reaffirms that the interest reserved by grantors is non-executive which is consistent not only with the definition of a non-participating royalty interest but also with the earlier phrases describing grantors’ conveyance of their leasing interest. See In re Bass, 113 S.W.3d 735, 745 (Tex. 2003) (All non-participating royalty interests are non-executive interests).

This language of reservation or exception correlates with the language that appeared in the intended clause which conveyed: “all of grantors’ right, title, interest and estate in and to the 7/8 leasing rights or working interest in the oil, gas and minerals in and under said land together *299 with all bonuses, delay rentals, oil payments and all other rights and benefits which may be provided for in any oil and gas leases which grantee, heirs and assigns, have or may hereafter execute upon the above mentioned property, together with the right of ingress and egress at all times for the purpose of enforcing his rights thereunder.” For, as we noted earlier, the holder of the leasing privilege is the executive-interest holder. Perryman, 546 S.W.3d at 119 (an exception refers to a “mere exclusion from the grant,” while a reservation must always be in favor of and for the benefit of the grantor).

Harmonizing the Deed’s Use of “Benefits”

The Holt heirs argue that the inclusion of the word “benefits” in both the intended clause and the shall-not-affect clause should be construed as evidencing a conveyance of the grantors’ royalty interest such that all attributes of the mineral estate were conveyed and none were reserved. Countering, WTX asserts that the deed’s use of the term “benefits” does not support the heirs’ argument. Examining the entire instrument to give effect to all provisions, we agree that the deed’s use of the term “benefits” does not equate with a conveyance of grantors’ royalty interest. Luckel, 819 S.W.2d at 462 (no provision shall be rendered meaningless).

Unlike terms such as “royalty” and “bonus,” which have well-understood meanings, the term “benefits,” operates as a catch-all for describing a variety of economic gains secured by leasing. E.g., Altman v. Blake, 712 S.W.2d 117, 119 (Tex. 1986) (“[W]hy would it not encompass all lease benefits, including the rights to receive royalties and delay rentals?”) (emphasis added).

Relying on Id. at 119.

Construing the language, Altman’s offhand reference to “benefits” fails to support the heirs’ argument that the term “benefits” includes royalties regardless of context.

Instead, in construing “benefits,” we are particularly guided by Id. at 74.

Throughout Id.

Pertinent to our analysis, Altman v. Blake, 712 S.W.2d 117, 118 (Tex. 1986) (“There are five essential attributes of a severed mineral estate: (1) the right to develop (the right of ingress and egress), (2) the right to lease (the executive right), (3) the right to receive bonus payments, (4) the right to receive delay rentals, [and] (5) the right to receive royalty payments.”)). Of note, the Court used the term “benefits” as a catch-all term but not as an equivalent when comparing lease benefits:

[O]btaining the same royalty in a mineral lease does not automatically equate to acquiring the same benefit from the mineral lease. On the other hand, the executive here indisputably holds the right to obtain benefits, such as bonuses and delay rentals, in which the non-executive has absolutely no interest.

Id. at 83 (emphasis added).

Finding the existence of a fact issue precluding judgment, Id. at 83.

Turning to the 1951 deed at issue, “benefits” appears alongside “bonuses” in the middle portion of the intended clause when describing future leases: “[G]rantee ... [is] hereby given the right to collect any and all bonuses and benefits on any future oil and gas leases[.]” Similarly, the last portion of the same clause further provides a description of economic gains conveyed to grantee including: “bonuses, delay rentals, oil payments and all other rights and benefits which may be provided for in any oil and gas leases which grantee, heirs and assigns, have or may hereafter execute upon the above mentioned property[.]” Guided by KCM Financial, 457 S.W.3d at 83–84.

The Four Corners of the Instrument

Here, giving effect to all provisions, the grantors not only reserved or excepted “the non-participating1/8th royalty in and under said land,” but also clarified how the reserved interest was distinguishable from the other interests which were expressly conveyed by earlier languages. Of note, the first and only time the term “royalty” is directly mentioned in the entirety of the instrument is within the provision describing what rights of the grantors’ the conveyance shall not affect. By use of the well-understood description, “non-participating royalty,” the language confirms that grantors Hamilton and Billie Roach reserved or excepted, as a free royalty, their entire royalty interest in the gross production of oil, gas, and other minerals to be carved out of the mineral fee estate. See Lesley, 352 S.W.3d at 487 (“The non-executive royalty interest owner owns an interest in the royalty when the executive leases the minerals.”). *302 Consistent with other clauses, however, the shall not affect clause further provides that the reserved interest does not carry with it the right to participate in the execution of, the bonus payable for, or the delay rentals to accrue under oil, gas, and mineral leases executed by grantee Holt. In this manner, the shall not affect language correlates with the conveyance of all but the royalty interest by re-stating that grantors shall have “no right to any bonuses, delay rentals, oil payments or other benefits under any oil, gas and mineral leases which have been made or which may hereafter be made by grantee, his heirs or assigns, upon said property.”

The Size of the Non-Participatory Royalty Interest

To construe the size of the royalty interest, we are once again guided by Id. at 11–13.

When a deed contains multiple fractions, disputes commonly arise over whether a conveyance or reservation reflects a fixed or floating royalty. Hysaw, 483 S.W.3d at 10.

Additionally, as further noted in Id.

Guided by Hysaw, 483 S.W.3d at 10. Again, as we earlier noted, no party asserts that grantors’ intended to convey a fractional working interest of the size of 7/8. To be consistent and cohesive, we similarly conclude that the fractional descriptor of 1/8 was not used to describe a fractional share of 1/8 but rather as a proxy for the usual and customary royalty of the deed’s era. Construing all language, we conclude that the 1951 deed conveyed the leasing rights, bonuses, delay rentals, and development rights, in their entirety, but reserved the entire non-participatory royalty as a floating royalty (rather than a fixed fraction or fixed royalty) in favor of grantors. Accordingly, we conclude that the trial court erred in granting the Holt heirs motion for partial summary judgment, while denying WTX’s cross motion for partial summary judgment.

Attorney’s Fees

Finally, as a related sub-issue, WTX contends the trial court erred in awarding attorney’s fees to the Holt heirs under the Declaratory Judgments Act because the award was based on the trial court’s grant of summary judgment in their favor on the construction of the deed. It is well recognized that a trial court may exercise its discretion in awarding attorney’s fees in any proceeding brought under the Declaratory Judgments Act. Neeley v. West Orange-Cove Consol. Indep. Sch. Dist., 176 S.W.3d 746, 799 (Tex. 2005).

We sustain WTX’s single issue.

CONCLUSION

For the reasons stated, we hold that the 1951 deed did not convey the royalty right, but instead, reserved grantors’ floating non-participatory royalty interest. Because the deed unambiguously reserved the royalty interest, we hold that the trial court erroneously granted a partial summary judgment in favor of the Holt heirs and awarded attorney’s fees, among other relief. Accordingly, we reverse the partial summary judgment of the trial court and render partial judgment in favor of WTX and declare that grantors’ royalty right was not conveyed by the 1951 deed. In light of our decision, we remand the cause to the trial court to determine WTX’s remedy and for reconsideration of an award, if any, of attorney’s fees.

Footnotes

1 One royalty deed conveys an undivided 161.56/643.12 interest and the other provides for a 40/643.12 interest for a total conveyance of 201.56/643.12. Both deeds provide for a term of twenty years from the date of signing and as long thereafter as oil, gas or other minerals, or either of them, is produced or mined from the land described therein. To illustrate a portion of the deed’s language, the larger of the two provides that grantors Hamilton S. Roach and wife, Billie Roach “have granted, sold, conveyed, assigned and delivered, and by these presents do grant, sell, convey, assign and deliver, unto the said Grantee an undivided 161.56/643.12 interest in and to all of the oil royalty, gas royalty, and royalty in casinghead gas, gasoline, and royalty in other minerals in and under, and that may be produced and mined from the following described lands situated in the County of Reagan and State of Texas, to-wit: All of Section 114, in Block 2, T. & P. Ry. Co. Survey Reagan County, Texas, containing 643.12 acres, more or less, together with the right of ingress and egress at all times[.]”
2 Specifically, the lease stated: “In addition to the royalties provided for above, lessee agrees to deliver to lessor 1/16 of 7/8ths of all oil, gas and casinghead gas which may be produced and saved by lessee from oil and gas wells located on the leased premises, until the cumulative total value of such part of production shall equal [$128,664.00], at which time the obligations of this paragraph shall terminate.”
3 In briefing, the parties agree that Laredo Petroleum holds the lease by assignment. The record shows the lease was originally contracted with Broad Oak Energy, Inc.
4 See TEX. NAT. RES. CODE ANN. § 91.404.
5 In briefing to this Court, WTX asserted that Y-Royalty Partners obtained its interests from three granddaughters of Hamilton Roach, who had inherited those interests from their father, Gerald Hamilton Roach. Y-Royalty later assigned its interest to WTX. As a result of these transactions, WTX claims ownership of 1/4 of the remaining interests that Hamilton Roach and Billie Roach purportedly did not convey in the 1951 deed.
6 With its summary judgment motion, WTX included evidence to prove that it had acquired a portion of the interest that remained with Hamilton Roach and Billie Roach after the execution of the 1951 deed. At trial, the Holt heirs did not object to WTX’s evidence or otherwise dispute the assertion that WTX had acquired a portion of whatever interest grantors’ heirs owned after executing the deed.

Court of Appeals of Texas, El Paso.

Ujashiv Management, Inc., a Texas Corporation, Appellants,

v.

Dharmesh PATEL, Appellee.

No. 08-18-00107-CV

|

December 13, 2019

*1 This case involves an interlocutory appeal from the trial court’s denial of Appellants’ motion to dismiss under the Texas Citizens Participation Act (TCPA). In five issues, Appellants contend: (1) the trial court erred in denying their timely-filed motion to dismiss because Appellee’s claims for theft and fraud are based on, relate to, or are in response to Appellants’ exercise of their right of free speech or association and thus fell within the scope of the TCPA; (2) Appellee failed to establish by clear and specific evidence a prima facie case on each essential element of his claims; (3) Appellee’s shareholder inspection claim was based on, related to, or was made in response to Appellants’ exercise of the right of petition because the complained-of communications were made during or pertained to a judicial proceeding; (4) Appellants met their burden of proof in establishing each essential element of the valid defense of effective consent; and (5) Appellants are entitled to costs, attorney’s fees, and expenses.1 We affirm.

BACKGROUND

This appeal arises out of a shareholder derivative suit brought by Dharmesh Patel against the managers and directors of Chandni I, Inc., a corporation that owns and manages a Quality Inn & Suites in El Paso, Texas. The facts are mostly procedural. Dharmesh filed his original petition on March 10, 2014, asserting claims for fraud and conversion, among other causes. He amended his petition four times. In his Third Amended Petition, filed on February 15, 2017, he included causes of action for fraud against several of the managers and directors individually, including Harshad Patel, Sunil Patel, Ashwin Patel, and Manish Vanmali. He also asserted claims for conversion against all defendants, except for Chandni I, individually and derivatively. In his Fourth Amended Petition, filed on November 13, 2017, he again asserted causes of action for fraud against Harshad, Sunil, Ashwin, and Manish individually but modified his conversion claims against the defendants by bringing them only in a derivative capacity. His fifth and final amended petition was filed on February 21, 2018 and included causes for theft and conversion against the named defendants, fraud against Harshad, and a new claim for shareholder inspection. Two months later on April 20, 2018, Appellants filed a motion to dismiss under the Texas Citizens Participation Act (TCPA), asserting that the claims for fraud, theft, and shareholder inspection were made in response to their exercise of freedom of speech, association, and petition. The trial court denied the motion and set a hearing for the purpose of assessing fees, costs, expenses, and sanctions against Appellants as required under the TCPA. Appellants then filed this interlocutory appeal.

DISCUSSION

Timeliness Under the TCPA

In their first issue, Appellants contend the trial court erred in denying their timely-filed motions to dismiss under the TCPA. Appellee contends Appellant’s motions to dismiss his fraud and theft claims were untimely because those claims had already been raised in previous petitions and therefore the 60-day deadline for filing for dismissal under the TCPA had already expired. Because further analysis of the issue is unnecessary if the motions were untimely, we address timeliness first.2

Standard of Review

*2 We review a trial court’s ruling on a motion to dismiss de novo. MVS International Corporation v. International Advertising Solutions, LLC, 545 S.W.3d 180, 190 (Tex.App.—El Paso 2017, no pet.).

Applicable Law

The Texas Citizen’s Participation Act (TCPA) authorizes a party to file a motion to dismiss if the claim against him relates to his exercising his right of free speech, petition, or association. TEX.CIV.PRAC.&REM.CODE ANN. § 27.003(b).

The Legislature has defined “legal action” in the context of the TCPA to mean “a lawsuit, cause of action, petition, complaint, cross-claim, or counterclaim or any other judicial pleading or filing that requests legal, declaratory or equitable relief.” Mancilla v. Taxfree Shopping, Ltd., No. 05-18-00136-CV, 2018 WL 6850951, at *3 (Tex.App.—Dallas Nov. 16, 2018, no pet.)(mem. op.)(holding additional details in a subsequent petition do not restart the 60-day clock if the same essential factual allegations as to the claim were present in an earlier petition.).

Analysis

Appellants contend they timely filed a motion to dismiss the fraud and Texas Theft Liability Act claims asserted in Appellee’s Fifth Amended Petition. Appellee, however, asserts the fraud and Texas Theft Liability Act claims in his Fifth Amended Petition are the same claims raised in Appellee’s prior petitions and relied on the same essential factual allegations.

The Fraud Claim

Appellants assert the Fifth Amended Petition includes a new claim for fraud against Harshad Patel, and because it was a newly-asserted legal action they had 60 days to file their motion to dismiss that cause under the TCPA. The Fifth Amended Petition was filed on February 21, 2018 and Appellants’ motion to dismiss under the TCPA was filed on April 20, 2018. If the fraud claim against Harshad was indeed a new legal action, their motion to dismiss was timely. TEX.CIV.PRAC.&REM.CODE ANN. § 27.003(b).

*3 But as Appellee correctly points out, the fraud claim against Harshad is the same claim he asserted in his Third and Fourth Amended Petitions and involves the same factual allegations; the only difference is the Fifth Amended Petition dropped certain factual allegations regarding the other defendants from the fraud claim against Harshad. The Third and Fourth Amended Petitions assert Harshad and the other defendants: (1) utilized their positions as managers and directors of Chandni I to obtain loans using corporate assets as collateral and then used the loan money to purchase investment properties that were placed in the individual defendants’ personal corporations that then competed directly with Chandni I; (2) made a distribution from Chandni I to themselves but not to the other shareholders; (3) utilized their positions to obtain personal loans from Chandni I without following corporate procedures; (4) concealed their activities by not providing information and access to corporate records; (5) misappropriated and comingled Chandni I’s corporate funds to purchase and operate rival hotels and other real estate; and (6) underreported earnings and personally took cash proceeds without authorization. The petitions further assert these acts were done deliberately and that Harshad and the other defendants had misrepresented and concealed corporate information from Appellee, and Appellee was induced through his trust in the Appellants to invest monies in the Appellants’ enterprise, which he would not have done absent the concealment. The petitions also asserted Appellee had, as a result of their fraud, lost monies he would have received as distributions as a shareholder. The Fourth Amended Petition differed from the Third in that Appellee brought the same claims on behalf of Chandni I derivatively instead of bringing them in his individual capacity as he did in the Third. These very same causes and factual theories are asserted in the Fifth Amended Petition under the section, “Fraud-As to HARSHAD, SUNIL, ASHWIN and MANISH.”

Appellants contend, however, that a new legal action was raised under a separate section in the Fifth Amended Petition entitled “Fraud-As to HARSHAD,” that raised a claim against Harshad individually. But no new claims or factual theories are raised in that section. Appellee simply reasserts: (1) that he relied on his trust in Harshad in his decision to invest in their venture; (2) that Harshad intentionally misrepresented and concealed information from him; and (3) that he lost monies he would have received as a shareholder. The same essential factual theories underlie this claim as were asserted in prior petitions, the only difference being that the theories were narrowed and the other defendants were dropped from the amended claim and it was brought against Harshad only. Because no new claims were added in the Fifth Amended Petition against Harshad and the claim asserted relies upon the same factual allegations underlying the Third and Fourth Amended Petitions, the 60-day deadline was not reset as to the fraud claim and Appellants’ motion to dismiss was untimely. See Jordan, 510 S.W.3d at 198.

The Theft Claim

Appellants also assert Appellee’s claim for theft under the Texas Theft Liability Act was a new legal action that served to reset the 60-day deadline under the TCPA. Specifically, Appellants contend the theft claim requires proof of wrongful intent to deprive, which was not an element of the conversion claim previously asserted in the Fourth Amended Petition. Appellee contends, however, the theft claim was alleged as conversion in the Fourth Amended Petition and asserts the same elements were plead and the same essential factual allegations were asserted; the mere fact the claim was labeled theft instead of conversion does not reset the 60-day clock.

A similar issue was addressed by our sister court in Id.

*4 The attorney filed an interlocutory appeal of the trial court’s denial of her motion to dismiss, contending the defamation claim involving the cover sheet was a “legal action” under the TCPA that reset the 60-day period for filing a motion to dismiss. Id.

Here, Appellants are similarly arguing that a “new” claim was asserted when Appellee attempted to distinguish his claims for conversion and theft of corporate assets. “Conversion” is the unauthorized and unlawful assumption and exercise of dominion and control over the personal property of another in denial of or inconsistent with the owner’s rights. Karbach v. Markham, No. 03-06-00636-CV, 2009 WL 3682604, at *8 (Tex.App.—Austin Nov. 6, 2009, no pet.)(mem. op.).

In his Fourth Amended Petition, in a section entitled “Conversion Against All Defendants Except CHANDNI I,” Appellee asserted the Appellants: (1) knowingly and without corporate authority fraudulently took and converted monies and loan proceeds from Chandni I and its shareholders, specifically asserting they distributed $1.8 million of Chandni I’s assets to themselves; (2) misused their positions as managers and directors of Chandni I to willfully and maliciously take and convert corporate monies and loan proceeds of Chandni I and used them to purchase competing hotels, real property, and other assets for their own benefit and to the detriment of Chandni I and its shareholders; and (3) took these monies in violation of Chandni I’s and the shareholder’s rights to the funds. In his Fifth Amended Petition, Appellee splits this claim into two. Under his second cause of action, entitled “Conversion Against All Defendants Except CHANDNI I,” Appellee asserted the Appellants: (1) misused their corporate positions to distribute loan proceeds in the amount of $1.8 million to themselves and used them to purchase real property and hotels; and (2) did so without corporate authority and with the intent to deprive Chandni I of its assets and loan proceeds. Under his third cause of action, entitled “Theft Pursuant to the Texas Theft Liability Act Against All Defendants Except CHANDNI I,” Appellee asserted the Appellants: (1) knowingly and without corporate authority took and converted Chandni I’s monies and loan proceeds for their own use and benefit; (2) willfully and maliciously converted Chandni I’s monies and loan proceeds in the amount of $1.8 million to purchase several hotels, other real properties, and assets for their own benefit and to the detriment of Chandni I; and (3) wrongfully took the monies for their own use.

While these claims have some differences in word order, phrasing, and structure, the same essential factual allegations are asserted that were previously asserted in the Fourth Amended Petition. As was the case in Paulsen, 455 S.W.3d at 198. Accordingly, Appellants’ first issue is overruled.

Relating to the Exercise of the Right to Petition

*5 In their third issue, Appellants contend Appellee’s shareholder inspection claim was based on, related to, or was made in response to their exercise of the right to petition because the complained-of communications were made during or pertained to a judicial proceeding. Specifically, they contend an email in which Appellants’ counsel rebuffed a request for a shareholder inspection was a communication pertaining to a judicial proceeding.

Applicable Law

As noted above, the TCPA authorizes a party to file a motion to dismiss if the claim against it relates to its exercising the right of free speech, petition, or association. Pena v. Perel, 417 S.W.3d 552, 556 (Tex.App.—El Paso 2013, no pet.).

The “exercise of the right to petition,” as relates to this case, is defined as a communication in or pertaining to a judicial proceeding. Id., at § 27.001(1).

Once a defendant has carried his initial burden to establish that the claims against him are covered by the TCPA, the burden shifts to the plaintiff to present a prima facie case for each element of his claim by clear and specific evidence to avoid mandatory dismissal. Id., at § 27.005(d).

Analysis

In his Fifth Amended Petition, Appellee raised a claim for shareholder inspection. In it, he asserted he had his request to inspect Chandni I’s records refused even though he was entitled as a shareholder to view them under Texas Business Organizations Code § 21.218. Specifically, he contended that in November 2017 he served a written demand for a shareholder inspection that Appellants denied. Appellants argue that the request was made in the context of a lawsuit after discovery had already occurred and that the shareholder inspection request was actually a discovery request. Thus, the email from counsel replying to the request was a communication regarding discovery and was part of a judicial proceeding. Appellants acknowledge that the TCPA does not define “judicial proceeding,” but cite several cases they assert stand for the proposition that communications related to discovery requests and discovery responses are communications made in a judicial proceeding.

Those cases are distinguishable, however, in that they involve claims arising out of the act of filing a lawsuit, serving discovery responses and subpoenas, and pre-suit demand letters threatening to file suit.3 Here, the letter requesting shareholder inspection, sent via facsimile, stated in pertinent part:

The purpose of this letter is to serve as written demand under Texas Business Organizations Code § 21.218. As you know, Dharmesh Patel[ ] is a shareholder of Chandni I, Inc. As a shareholder, Mr. Patel has a right, upon written demand stating a proper purpose, to examine and copy any relevant books, records of account, minutes, and share transfer records.

*6 Mr. Patel’s purpose in making this demand for inspection includes ascertaining the financial condition of the corporation, determining the value of shares, and investigating company management, waste of corporate assets, self-dealing or other wrongdoing.

As a result, we are requesting an inspection date of December 18, 2017 at 1:00 p.m. If you have any questions or comments, please do not hesitate to call.

Appellants assert the demand was actually a discovery request, and their response to this demand was a covered communication under the TCPA because it was a response to a discovery request. The response, sent via email from Appellants’ counsel, refused the request for inspection but suggested they would allow the inspection if Appellee provided additional legal authority to support his request.

But the demand, and the response to it, did not involve a discovery request; it was a demand to exercise a statutory right that does not derive from a judicial proceeding but is based on the relationship between a shareholder and a corporation. The mere fact that judicial review of the issue could occur if an agreement was not reached does not automatically make it a matter related to a judicial proceeding. See TEX.CIV.PRAC.&REM.CODE ANN. § 27.003(a). The trial court did not err in denying Appellants’ motion to dismiss the shareholder inspection claim, and Appellants’ third issue is overruled.

Remaining Issues

*7 Because we have concluded that Appellants have not met their burden to show their TCPA motion to dismiss the fraud and theft claims was timely filed, and that Appellants’ motion to dismiss the shareholder inspection claim was not based on the exercise of the right to petition, we need not address Appellants’ contentions regarding whether Appellee had established a prima facie case (Issue Two) or whether Appellants met their burden of proof in establishing a valid defense to Appellee’s prima facie case (Issue Four). See TEX.CIV.PRAC.&REM.CODE ANN. § 27.009 (moving party entitled to costs, attorney’s fees, and other expenses only if motion to dismiss is granted).

CONCLUSION

Having overruled Issues One through Five, the judgment of the trial court is affirmed.

Footnotes

1

Although Appellants do not list their request for costs, attorney’s fees, and expenses as an issue presented, they do raise and brief the issue.

2

Appellee does not contend Appellants’ motion to dismiss the shareholder inspection claim was untimely.

3

See Long Canyon Phase II and III Homeowners Assn., Inc. v. Cashion, 517 S.W.3d 212, 220-21 (Tex.App.—Austin 2017, no pet.)(holding that a pre-suit demand letter threatening suit sent by a housing association was an exercise of the right to petition).

Court of Appeals of Texas, El Paso.

CHANDNI, INC., a Texas Corporation; Harshad Patel, an Individual; Sunil Patel, an Individual; Manish Vanmali, an Individual, Appellants,

v.

Dharmesh PATEL, Appellee.

No. 08-18-00108-CV

|

December 13, 2019

*1 This case involves an interlocutory appeal from the trial court’s denial of Appellants’ motion to dismiss under the Texas Citizens Participation Act (TCPA). In four issues, Appellants contend: (1) the trial court erred in denying their timely-filed motion to dismiss because Appellee’s claims for theft, fraud, conspiracy, and statutory fraud are based on, relate to, or are in response to Appellants’ exercise of their right of free speech or association and thus fell within the scope of the TCPA; (2) Appellee failed to establish by clear and specific evidence a prima facie case on each essential element of his claims; (3) Appellee’s shareholder inspection claim was based on, related to, or was made in response to Appellants’ exercise of the right to petition because the complained-of communications were made during or pertained to a judicial proceeding; and (4) Appellants are entitled to costs, attorney’s fees, and expenses.1 We affirm.

BACKGROUND

This appeal arises out of a shareholder derivative suit brought by Dharmesh Patel against the managers and directors of Chandni, Inc., a corporation that owns and manages a Motel 6 in El Paso, Texas. The facts are mostly procedural. Dharmesh filed his original petition on March 10, 2014, asserting claims for fraud and conversion, among other causes. He amended his petition three times. In his Second Amended Petition, filed on February 15, 2017, he included causes of action for fraud against several of the managers and directors individually, including Harshad Patel, Sunil Patel, and Manish Vanmali. He also asserted claims for conversion and aiding and abetting against all defendants, except for Chandni, individually and derivatively. In his Third Amended Petition, filed on November 13, 2017, he again asserted causes of action for fraud against Harshad, Sunil, and Manish individually, and he again brought his conversion and aiding and abetting claims against all defendants except Chandni individually and derivatively. His fourth and final amended petition was filed on March 12, 2018, asserting causes of action for fraud and statutory fraud against Harshad, Sunil, and Manish individually, as well as conversion, theft, aiding and abetting, and conspiracy claims against all defendants except Chandni individually and derivatively, and a new claim for shareholder inspection. Nearly two months later, on May 7, 2018, Appellants filed a motion to dismiss under the Texas Citizens Participation Act (TCPA), asserting that the claims for fraud, statutory fraud, theft, conspiracy, and shareholder inspection were made in response to their exercise of their rights to freedom of speech, association, and petition. The trial court denied the motion and set a hearing for the purpose of assessing fees, costs, expenses, and sanctions against Appellants as required under the TCPA. Appellants then filed this interlocutory appeal.

DISCUSSION

Timeliness Under the TCPA

*2 In their first issue, Appellants contend the trial court erred in denying their timely-filed motions to dismiss under the TCPA. Appellee contends that their motions to dismiss his fraud, statutory fraud, theft, and conspiracy claims were untimely because those claims had already been raised in previous petitions and therefore the 60-day deadline for filing for dismissal under the TCPA had already passed. Because further analysis of the issue is unnecessary if the motions were untimely, we address timeliness first.2

Standard of Review

We review a trial court’s ruling on a motion to dismiss de novo. MVS International Corporation v. International Advertising Solutions, LLC, 545 S.W.3d 180, 190 (Tex.App.—El Paso 2017, no pet.).

Applicable Law

The Texas Citizen’s Participation Act (TCPA) authorizes a party to file a motion to dismiss if the claim against him relates to his exercising his right of free speech, petition, or association. TEX.CIV.PRAC.&REM.CODE ANN. § 27.003(b).

The Legislature has defined “legal action” in the context of the TCPA to mean “a lawsuit, cause of action, petition, complaint, cross-claim, or counterclaim or any other judicial pleading or filing that requests legal, declaratory, or equitable relief.” Mancilla v. Taxfree Shopping, Ltd., No. 05-18-00136-CV, 2018 WL 6850951, at *3 (Tex.App.—Dallas Nov. 16, 2018, no pet.)(mem. op.)(holding additional details in a subsequent petition do not restart the 60-day clock if the same essential factual allegations as to the claim were present in an earlier petition.).

Analysis

Appellants contend they timely filed a motion to dismiss the statutory fraud, conspiracy and Texas Theft Liability Act claims asserted in Appellee’s Fourth Amended Petition. Appellee, however, asserts these claims were the same claims raised in his prior petitions and relied on the same essential factual allegations.

The Theft Claim

*3 Appellants assert Appellee’s claim for theft under the Texas Theft Liability Act in his Fourth Amended Petition was a new legal action that served to reset the 60-day deadline under the TCPA. Because it was a newly-asserted legal action, they assert they had sixty days to file their motion to dismiss that cause under the TCPA. The Fourth Amended Petition was filed on March 12, 2018 and Appellants’ motion to dismiss under the TCPA was filed on May 7, 2018. If the theft claim was indeed a new legal action, their motion to dismiss was timely. TEX.CIV.PRAC.&REM.CODE ANN. § 27.003(b).

Specifically, Appellants contend the theft claim requires proof of wrongful intent to deprive, which was not an element of the conversion claim previously asserted in the Third Amended Petition. Appellee contends, however, that the theft claim was alleged as conversion in the Third Amended Petition and asserts the same elements were plead and the same essential factual allegations were asserted; the mere fact that the claim was labeled theft instead of conversion does not reset the 60-day clock.

A similar issue was addressed by our sister court in Id.

The attorney filed an interlocutory appeal of the trial court’s denial of her motion to dismiss, contending the defamation claim involving the cover sheet was a “legal action” under the TCPA that reset the 60-day period for filing a motion to dismiss. Id.

*4 Here, Appellants are similarly arguing that a “new” claim was asserted when Appellee attempted to distinguish his claims for conversion and theft of corporate assets. “Conversion” is the unauthorized and unlawful assumption and exercise of dominion and control over the personal property of another in denial of or inconsistent with the owner’s rights. Karbach v. Markham, No. 03-06-00636-CV, 2009 WL 3682604, at *8 (Tex.App.—Austin Nov. 6, 2009, no pet.)(mem. op.).

In his Third Amended Petition, in a section entitled “Conversion Against All Defendants Except CHANDNI,” Appellee asserted the Appellants: (1) knowingly and without corporate authority fraudulently took and converted monies and loan proceeds from Chandni and its shareholders, specifically asserting they distributed $330,000.00 of Chandni’s assets to themselves; (2) paid themselves distributions that were greater than they were entitled to while paying other shareholders, including Appellee, less than they were entitled to; and (3) took these monies in violation of Chandni’s and the shareholder’s rights to the funds. In his Fourth Amended Petition, Appellee splits this claim into three separate claims and drops several defendants. Under his second cause of action, entitled “Conversion Against HARSHAD, SUNIL and MANISH,” Appellee asserted the Appellants: (1) misused their corporate positions to distribute loan proceeds in the amount of $330,000.00 to themselves; and (2) did so without corporate authority and with the intent to deprive Chandni of its assets and loan proceeds. Under his third cause of action, entitled “Theft Pursuant to the Texas Theft Liability Act Against HARSHAD, SUNIL and MANISH,” Appellee asserted the Appellants: (1) knowingly and without corporate authority took and converted Chandni’s monies and loan proceeds for their own use and benefit; and (2) wrongfully and intentionally took the monies for their own use in repudiation of CHANDNI’s right to the monies. In his eighth cause of action, also entitled “Theft Pursuant to the Texas Theft Liability Act Against HARSHAD, SUNIL and MANISH,” Appellee asserted the Appellants: (1) paid themselves distributions that were greater than they were entitled to while paying other shareholders, including Appellee, less than they were entitled to; and (2) did so intentionally and in repudiation of Appellee’s right to the monies.

While these claims have some differences in word order, phrasing, and structure, the same essential factual allegations are asserted that were previously asserted in the Third Amended Petition. As was the case in Paulsen, 455 S.W.3d at 198.

The Conspiracy Claims

*5 Appellants assert the Fourth Amended Petition also included new claims for derivative and individual capacity civil conspiracy. Appellee contends the conspiracy allegations were already raised in his Third Amended Petition and contends the same elements were plead and the same essential factual allegations were asserted, with only additional details and the section title truly differentiating them.

In his Third Amended Petition, in a section entitled “Aiding and Abetting Against All Defendants Except CHANDNI,” Appellee asserted the Appellants: (1) “pursued, or joined in the pursuit of, a common course of conduct, and acted in concert with and conspired with one another, in furtherance of their common plan or design. In addition to the wrongful conduct herein alleged as giving rise to primary liability, the INDIVIDUAL DEFENDANTS further aided and abetted and/or assisted each other in breach of their respective duties as herein alleged;” (2) “conspired” with each other in furtherance of their fraudulent scheme and took actions to conceal their unlawful conduct; (3) acting with knowledge of the wrongdoing, substantially assisted the accomplishment of that wrongdoing and were aware of their overall individual contribution; and (4) committed the acts alleged “in furtherance of the conspiracy, common enterprise, and common course of conduct complained of herein.” In his Fourth Amended Petition, in a section entitled “Aiding and Abetting and Conspiracy Liability Against HARSHAD, SUNIL and MANISH,” Appellee asserted the named Appellants: (1) “pursued, or joined in the pursuit of, a common course of conduct, and acted in concert with and conspired with one another, in furtherance of their common plan or design;” (2) had the intent to assist each other in the conduct, which they knew to be wrongful, and thus aided and abetted each other in the pursuit of that conduct; (3) joined together with intent to further their unlawful purpose; and (4) did act to further that unlawful purpose.

As was true with the theft and conversion claims in the previous section, claims that have some differences in word order, phrasing, and structure, but do not add new claims or essential factual allegations, do not serve to reset the 60-day filing deadline under the TCPA. See In re Estate of Check, 438 S.W.3d at 837. Because the same essential factual allegations are asserted regarding Appellants’ alleged conspiracy and aiding and abetting that were previously asserted in the Third Amended Petition, Appellants have failed to show the motion to dismiss the civil conspiracy claim under the TCPA was timely.

The Fraud and Statutory Fraud Claim

Appellants assert the Fourth Amended Petition included new claims for fraud and statutory fraud against Harshad, Sunil, and Manish, and because it was a newly-asserted legal action it reset the 60-day deadline to file their motion to dismiss that cause under the TCPA.

But as Appellee correctly points out, the fraud and statutory fraud claims are the same claims he asserted in his Third Amended Petition and involve the same factual allegations and elements; the only difference is the Fourth Amended Petition divided the original claim into two. The Third Amended Petition, in a section entitled “Fraud-As to HARSHAD, SUNIL, ASHWIN and MANISH,” asserts the Appellants: (1) utilized their positions as managers and directors of Chandni to obtain loans using corporate assets as collateral and then improperly distributed the proceeds into their personal accounts or used the proceeds to invest in competing enterprises; (2) made distributions from Chandni to themselves but not to other shareholders, disguising the distributions as loans; (3) utilized their positions to pay themselves officer compensation from Chandni without corporate authority; (4) concealed their activities by not providing information and access to corporate records; (5) misappropriated and comingled Chandni’s corporate funds with their own monies; (6) underreported earnings and personally took cash proceeds without authorization; and (7) improperly made distributions to shareholders in amounts unequal to their respective ownership interests. The petition further asserts these acts were done deliberately and that the Appellants had misrepresented and concealed corporate information from Appellee, and that Appellee was induced through his trust in the Appellants to invest monies in their enterprise, which he would not have done absent the concealment. The petitions also asserted Appellee had, as a result of their fraud, lost monies he would have received as distributions as a shareholder. These same causes and factual theories are asserted derivatively in the Fourth Amended Petition under the section, “Fraud-As to HARSHAD, SUNIL, ASHWIN and MANISH.”

*6 Appellants contend, however, that a new legal action was raised under a separate section in the Fourth Amended Petition entitled “Common Law Fraud and Statutory Fraud [P]ursuant to Jordan, 510 S.W.3d at 198. Accordingly, Appellants’ first issue is overruled.

Relating to the Exercise of the Right to Petition

In their third issue, Appellants contend Appellee’s shareholder inspection claim was based on, related to, or was made in response to their exercise of the right to petition because the complained-of communications were made during or pertained to a judicial proceeding. Specifically, they contend an email in which Appellants’ counsel rebuffed a request for a shareholder inspection was a communication pertaining to a judicial proceeding.

Applicable Law

As noted above, the TCPA authorizes a party to file a motion to dismiss if the claim against it relates to its exercising the right of free speech, petition, or association. Pena v. Perel, 417 S.W.3d 552, 556 (Tex.App.—El Paso 2013, no pet.).

The “exercise of the right to petition,” as relates to this case, is defined as a communication in or pertaining to a judicial proceeding. Id., at § 27.001(1).

Once a defendant has carried his initial burden to establish that the claims against him are covered by the TCPA, the burden shifts to the plaintiff to present a prima facie case for each element of his claim by clear and specific evidence to avoid mandatory dismissal. Id., at § 27.005(d).

Analysis

In his Fourth Amended Petition, Appellee raised a claim for shareholder inspection. In it, he asserted he had his request to inspect Chandni’s records refused even though he was entitled as a shareholder to view them under Texas Business Organizations Code § 21.218. Specifically, he contended that in November 2017 he served a written demand for a shareholder inspection that Appellants denied. Appellants argue that the request was made in the context of a lawsuit after discovery had already occurred and that the shareholder inspection request was actually a discovery request. Thus, the email from counsel replying to the request was a communication regarding discovery and was part of a judicial proceeding. Appellants acknowledge that the TCPA does not define “judicial proceeding,” but cite several cases they assert stand for the proposition that communications related to discovery requests and discovery responses are communications made in a judicial proceeding.

Those cases are distinguishable, however, in that they involve claims arising out of the act of filing a lawsuit, serving discovery responses and subpoenas, and pre-suit demand letters threatening to file suit.3 Here, the letter requesting shareholder inspection, sent via facsimile, stated in pertinent part:

*7 The purpose of this letter is to serve as written demand under Texas Business Organizations Code § 21.218. As you know, Dharmesh Patel[ ] is a shareholder of Chandni, Inc. As a shareholder, Mr. Patel has a right, upon written demand stating a proper purpose, to examine and copy any relevant books, records of account, minutes, and share transfer records.

Mr. Patel’s purpose in making this demand for inspection includes ascertaining the financial condition of the corporation, determining the value of shares, and investigating company management, waste of corporate assets, self-dealing or other wrongdoing.

As a result, we are requesting an inspection date of December 18, 2017 at 3:30 p.m. If you have any questions or comments, please do not hesitate to call.

Appellants assert the demand was actually a discovery request, and their response to this demand was a covered communication under the TCPA because it was a response to a discovery request. The response, sent via email from Appellants’ counsel, refused the request for inspection but suggested they would allow the inspection if Appellee provided additional legal authority to support his request.

But the demand, and the response to it, did not involve a discovery request; it was a demand to exercise a statutory right that does not derive from a judicial proceeding but is based on the relationship between a shareholder and a corporation. The mere fact that judicial review of the issue could occur if an agreement was not reached does not automatically make it a matter related to a judicial proceeding. See TEX.CIV.PRAC.&REM.CODE ANN. § 27.003(a). The trial court did not err in denying Appellants’ motion to dismiss the shareholder inspection claim, and Appellants’ third issue is overruled.

Remaining Issues

*8 Because we have concluded that Appellants have not met their burden to show their TCPA motion to dismiss the fraud, statutory fraud, conspiracy, and theft claims was timely filed, and that Appellants’ motion to dismiss the shareholder inspection claim was not based on the exercise of the right to petition, we need not address Appellants’ contention regarding whether Appellee had established a prima facie case. See TEX.CIV.PRAC.&REM.CODE ANN. § 27.009 (moving party entitled to costs, attorney’s fees, and other expenses only if motion to dismiss is granted).

CONCLUSION

Having overruled Issues One through Four, the judgment of the trial court is affirmed.

Footnotes

1

Although Appellants do not list their request for costs, attorney’s fees, and expenses as an issue presented, they do raise and brief the issue.

2

Appellee does not contend Appellants’ motion to dismiss the shareholder inspection claim was untimely.

3

See Long Canyon Phase II and III Homeowners Assn., Inc. v. Cashion, 517 S.W.3d 212, 220-21 (Tex.App.—Austin 2017, no pet.)(holding that a pre-suit demand letter threatening suit sent by a housing association was an exercise of the right to petition).

Court of Appeals of Texas, El Paso.

APC HOME HEALTH SERVICES, INC., Appellant,

v.

Lucina MARTINEZ, Appellee.

No. 08-18-00171-CV

|

December 12, 2019

Appeal from the County Court at Law Number Seven Of El Paso County, Texas (TC# 2017DCV4119), The Honorable Ruben P. Morales, Judge

Attorneys & Firms

ATTORNEY FOR APPELLANT, Jerry Fazio, Owen & Fazio, P.C., 10440 N. Central Expwy, Ste. 1450, Dallas, TX 75231.

ATTORNEY FOR APPELLEE, Jeffrey B. Pownell, Scherr & Legate, PLLC, 109 N. Oregon, 12th Floor, El Paso, TX 79901.

Before McClure, Senior Judge (Sitting by Assignment)

OPINION

ANN CRAWFORD McCLURE, Senior Judge

*1 This is an interlocutory appeal from the denial of a motion to compel arbitration. The trial court denied the motion without saying why. Consequently, there are a host of issues before us, including whether APC carried its burden to show the parties agreed to arbitrate the claims asserted here, and if so, whether Lucina Martinez carried her burden to substantiate any of the defensive theories she asserted below. Bound up with the later question is whether the agreement is governed by the Federal Arbitration Act (FAA), whether it is procedurally unconscionable, or whether certain provisions are substantively unconscionable. We reverse and remand with instructions.

BACKGROUND

As its name suggests, APC Home Health Services, Inc. (APC) is a home health care provider. On May 1, 2016, and while employed by APC, Martinez was working at a patient’s home. While transferring the patient from a bed to a wheel chair, Martinez claims she injured her neck, back, and other parts of her body. She filed suit against APC, alleging a common law negligence cause of action. APC is a non-subscriber under the Texas worker’s compensation system. APC answered and then moved to compel arbitration.

APC supported its motion to compel arbitration with the affidavit of Jovie Cantu, identified as APC’s records custodian. Cantu’s affidavit proved up as a business record an attached “Arbitration Agreement and Notice of Arbitration Policy.” The agreement, dated April 20, 2016, bears the signature of a “Lucina Martinez”; the title and main body of the document are entirely in Spanish. APC attached another exhibit represented to be an English translation of the agreement. Its key terms include:

APC Home Health Service, Inc. ... (“Company,” “we” or “our”) maintains a mandatory binding arbitration policy. It is a condition of your employment with us that you and we agree to arbitrate all arbitrable claims arising from or related to your employment with us (the “Claims,” itemized below), save and except any benefit claims arising under our Occupational Injury Benefit Plan, and any claims made not arbitrable by governing statute or rule.

1. Effective Date: The effective date of this Arbitration Agreement and Notice of Arbitration Policy (this “Arbitration Agreement”) is 5/16/12 (the “Effective Date”).

...

If you are already working for Company when you receive notice of this Arbitration Agreement, and you continue working for us for more than three more days, you will be deemed to have accepted the terms of this Arbitration Agreement on the fourth day, and thereafter. In that event, the fourth day is your effective date to be governed by this Arbitration Agreement. IF YOU CONTINUE TO WORK FOR US AFTER THE EFFECTIVE DATE, YOU AND WE WILL HAVE MUTUALLY AGREED TO ARBITRATE ALL COVERED CLAIMS BETWEEN US, APPLYING THE TERMS OF THIS ARBITRATION AGREEMENT.

2. Arbitration Is Mandatory, Binding, and Mutual: All Claims related to your employment with us arising in any part after the Effective Date, save and except any benefit claims under our Occupational Injury Benefit Plan and any claims made not arbitrable by governing statute or rule, will be resolved only through mandatory binding arbitration. You and we both agree to arbitrate all Claims, and you and we both waive all rights to a jury or non-jury trial in state and federal court as to the Claims. [bolding and capitalizations all original]

*2 The agreement was signed on April 20, 2016. The date of the accident is alleged as May 1, 2016.1

The agreement further describes what claims are governed by arbitration:

4. The Claims: Claims covered under this Arbitration Agreement include, but are not limited to the following: (i) claims arising from any injury suffered by an Employee while in the Course and Scope of Employment with Company, including but not limited to claims for negligence, gross negligence, and all claims for personal injuries, physical impairment, disfigurement, pain and suffering, mental anguish, ....

And further relevant here, the agreement includes this provision:

6. How the Arbitration Will Be Conducted: You and we agree Company is engaged in interstate commerce, and that the Federal Arbitration Act (“FAA”) will govern all aspects of this Arbitration Agreement.

APC also provided its employees an occupational injury plan that provided defined medical and indemnity benefits. While the plan document has a space for the employee’s signature, the plan in our record is unsigned. Nonetheless, APC included the affidavit of a claim’s manager for Pan-American Life Insurance Company documenting that Martinez received $4,977.55 in indemnity benefits and $645.16 in medical payments under the terms of APC’s Occupation Injury Benefit Plan.

Martinez opposed the motion to compel arbitration on several grounds: (1) the attached agreement was only a copy, and Martinez questioned its authenticity; (2) the FAA does not apply because there was no transaction involving commerce; (3) Congress never intended the FAA to supplant a state worker’s compensation scheme; (4) enforcing the arbitration agreement through the FAA would violate the 10th Amendment; (5) the agreement is unconscionable; (6) pre-injury waivers for non-subscribers are void; (7) the agreement is illusory for lack of mutuality of obligation; and alternatively, (8) the court should reform the agreement to remove any unconscionable provisions.

In support of its opposition, Martinez included her own affidavit that in relevant part attested:

• That she has “limited ability in reading, writing or understanding English.”

• That all her work “was performed locally in El Paso, Texas.”

• That she does “not remember signing” the arbitration agreement attached to APC’s Motion to Compel Arbitration, nor does she “remember anything about this document.”

Her affidavit also described the manner in which the agreement may have been executed:

• “When I began work for APC, I was required and told to sign things and I did not know why. I was told that the documents were routine paperwork or documents I needed to sign in order to work. I was misled into believing that the documents were not important and were just routine documents that the company needed to complete their paperwork on my employment. I did not know and I was never told by anyone at APC that what I was signing was an arbitration agreement or anything other than papers required to be signed for my job. I was never told that I could be waiving rights that I had or that I could seek the advice of an attorney before signing these documents. I was never told the documents contained an arbitration agreement. I was not given any time to review the documents prior to signing them.... No one from APC ever provided an orientation session or any other kind of meeting where any of the documents I was required to sign was explained. No one at APC ever explained or discussed any arbitration agreement to me. (CR 279-80)

*3 The trial court held two hearings on APC’s motion. At the first hearing, APC’s counsel represented that it had a witness ready to testify that Martinez signed the arbitration agreement. The trial judge asked Martinez’s counsel if Martinez denied signing the document. Her counsel responded that Martinez did not recall signing the document. The trial court found that assertion insufficient to raise an issue as to her signature, and the trial court stated that there was no need to call the witness to testify.2

The trial court was more concerned with some of Martinez’s defenses to the agreement, and particularly whether arbitration would have truly been a more efficient and less costly alternative to litigation, and if not, why an employer would choose that forum.3 The trial court desired a full evidentiary hearing on the cost issue and directed APC’s counsel to submit evidence on the likely cost of arbitration in this case. APC did so through a subsequent filing that included several documents summarizing studies on arbitration’s cost savings. Martinez offered no evidence of her own on that issue. Following that second hearing, the trial court denied the motion to compel arbitration without issuing any findings of fact or conclusions of law. APC then brought this interlocutory appeal.4 It asserts three issues: (1) whether the trial court erred in failing to compel arbitration; (2) whether Martinez met her burden to substantiate a defense to the arbitration agreement; and (3) whether the undisputed evidence shows that arbitration is a more cost-effective forum.

FRAMEWORK FOR REVIEW

“[A]rbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.” Delfingen US–Texas, L.P. v. Valenzuela, 407 S.W.3d 791, 797 (Tex.App.--El Paso 2013, no pet.).

*4 If the proponent of arbitration has offered prima facia evidence for the existence of a valid agreement which covers the dispute, a presumption arises in favor of arbitrating the dispute, and the burden shifts to the resisting party to raise an affirmative defense to enforcing that agreement. In re Poly–America, L.P., 262 S.W.3d 337, 348 (Tex. 2008) (orig. proceeding).

Motions to compel arbitration are ordinarily decided in summary proceedings “on the basis of affidavits, pleadings, discovery, and stipulations.” United Rentals, Inc. v. Smith, 445 S.W.3d 808, 812 (Tex.App.--El Paso 2014, no pet.) (affirming denial of arbitration where employer failed to authenticate agreement).

We review a trial court’s order denying a motion to compel arbitration for abuse of discretion. Cardwell v. Whataburger Rests., L.L.C., 484 S.W.3d 426, 428 (Tex. 2016).

APC MET ITS INITIAL BURDEN TO SHOW THE EXISTENCE OF AN AGREEMENT TO ARBITRATE

Courts determine whether an enforceable agreement to arbitrate exists by applying “ordinary principles of state contract law[.]” Karns v. Jalapeno Tree Holdings, L.L.C., 459 S.W.3d 683, 692 (Tex.App.--El Paso 2015, pet. denied).

*5 APC met its initial burden to evidence an agreement to arbitrate in two ways. First, it presented the agreement supported by the affidavit of its records custodian. Second, when Martinez requested the original document as the best evidence of the contract, APC was prepared to present at the hearing a witness who would confirm the execution of the agreement by Martinez. The witness did not actually testify because Martinez’s counsel affirmed that Martinez would only testify that she did not recall signing the document. Not recalling executing a document is different from denial of execution. Banda v. Garcia, 955 S.W.2d 270 (Tex. 1997) (per curiam) (lawyer’s unsworn statements can be treated as evidence if the lawyer makes the statements under circumstances in which the opposing party knows or should know that an objection is necessary). Based on those predicates, we conclude, as apparently did the trial judge below, that Martinez signed the arbitration agreement.

And having concluded that Martinez signed the document, we are permitted a further inference that Martinez accepted the terms of the agreement. The fact that a party has signed a contract creates a strong presumption that the party has assented to its terms. ReadyOne Industries, Inc. v. Casillas, 487 S.W.3d 254, 258 (Tex.App.--El Paso 2015, no pet.) (party signing a contract “is presumed to have read it and grasped its contents and legal effects”).

In turn, the agreement itself reflects mutual promises to arbitrate, which is sufficient consideration to support an arbitration agreement. Wright, 469 S.W.3d at 757 (party’s signature on contract creates a “strong presumption” that the party assented to the contract).

THE ALLEGATIONS FALL WITHIN THE SCOPE OF THE AGREEMENT TO ARBITRATE

Martinez’s suit alleges she injured herself in a workplace accident. The arbitration agreement expressly includes that type of claim as governed by the agreement. Martinez did not contest below, nor on appeal, that her workplace injury claim would fall within the scope of the arbitration agreement. That leaves for our consideration the defenses that Martinez asserted below.5

THE FAA APPLIES

Enforcement of the arbitration agreement first turns on whether the FAA applies. Under Texas law, an arbitration agreement is generally enforceable, but if it governs a personal injury claim, the agreement must be approved by both parties and their attorneys. Southland Corp. v. Keating, 465 U.S. 1, 15-16, 104 S.Ct. 852, 79 L.Ed.2d 1 (1984) (“In creating a substantive rule applicable in state as well as federal courts, Congress intended to foreclose state legislative attempts to undercut the enforceability of arbitration agreements.”) (footnotes omitted).

*6 Section 2 of the FAA provides in pertinent part:

A written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction, ... shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.

9 U.S.C. § 2 (emphasis supplied). Both below and on appeal, Martinez focuses on the requirement that APC must show a “contract evidencing a transaction involving commerce” to sustain application of the FAA.

The U.S. Supreme Court has interpreted the term “involving commerce” in the FAA “as the functional equivalent of the more familiar term ‘affecting commerce’--words of art that ordinarily signal the broadest permissible exercise of Congress’ Commerce Clause power.” In re Big 8 Food Stores, Ltd., 166 S.W.3d 869, 880 (Tex.App.--El Paso 2005, orig. proceeding) (same).

We note that APC’s motion provided no actual proof, other than the parties contractual recitation, that APC was engaged in interstate commerce. That is, unlike many of the cases where courts have found the FAA to apply, there was no affidavit or other proof that the underlying transaction or employer’s business involved interstate commerce. See e.g. Bernhardt v. Polygraphic Co. of America, 350 U.S. 198, 76 S.Ct. 273, 100 L.Ed. 199 (1956) and argues that a court must focus on the employee’s specific role in interstate commerce.

In Id. at 200-01, 76 S.Ct. 273.

*7 Building on this argument, Martinez also directs us to United States v. Lopez, 514 U.S. 549, 559, 115 S.Ct. 1624, 131 L.Ed.2d 626 (1995) (“We conclude, consistent with the great weight of our case law, that the proper test requires an analysis of whether the regulated activity ‘substantially affects’ interstate commerce.”).

Appealing as these arguments may be, we are constrained by precedent to reject them. We previously rejected the In re Border Steel, Inc., 229 S.W.3d at 831 (“[E]ven if no Border Steel employee worked outside the State of Texas, that fact alone would not preclude the company’s affecting interstate commerce.”).

Further, Martinez’s argument that it must be her work that substantially affects interstate commerce has in our view been rejected by the U.S. Supreme Court. Two cases make the point. In Id. at 57-58, 123 S.Ct. 2037.

*8 More recently, the Court decided Id. at 2080.

Likewise, even if Martinez’s role in her company be slight, the company’s business could play a substantial role in commerce and support Congress’s interest in the arbitration of these kinds of disputes. That is essentially our holding in In re Big 8 Food Stores, Ltd., 166 S.W.3d at 880 (rejecting analysis that would look at how individual part-time employee affected commerce).

We conclude here that the trial court could not have rejected the FAA’s application, and thereby invalidate the arbitration agreement under the TAA.6

UNCONSCIONABILITY

Martinez also raised below an unconscionability defense. An arbitration agreement might be attacked as either being (1) procedurally unconscionable (referring to the circumstances surrounding the adoption of the arbitration provision) or (2) substantively unconscionable (referring to the fairness of the arbitration provision itself). In re Halliburton Co., 80 S.W.3d 566, 571 (Tex. 2002).

Unconscionability has no precise legal definition because it is not a concept, but a determination made in light of a variety of factors. Delfingen, 407 S.W.3d at 798.7

Procedural Unconscionability

*9 In deciding whether a contract is procedurally unconscionable, we look to: “(1) the entire atmosphere in which the agreement was made; (2) the alternatives, if any, available to the parties at the time the contract was made; (3) the non-bargaining ability of one party; (4) whether the contract was illegal or against public policy; and (5) whether the contract is oppressive or unreasonable.” Delfingen, 407 S.W.3d at 798.

We begin with several guideposts governing Martinez’s claim. First, the fact that parties would choose arbitration over a judicial forum is of no consequence, because there is nothing per se improper with arbitration; Texas public policy has long favored it. In re Olshan Found. Repair Co., LLC, 328 S.W.3d 883, 892 (Tex. 2010) (“We should be wary of setting the bar for holding arbitration clauses unconscionable too low.”).

Our cases have focused on circumstances when the employee lacked the means to understand the terms of the agreement and misrepresentations were made about the nature of what they were signing. Cf. ReadyOne Industries, Inc. v. Flores, 460 S.W.3d at 666–67 (same).

Here, there is no fact issue raised about Martinez’s ability to understand the document. She asserted in her affidavit that she has limited English language skills, but the agreement she signed was in Spanish. The only assertion of any misrepresentation is that APC told her the documents were “routine paperwork or documents” that she needed to sign in order to work. According to her: “I was misled into believing that the documents were not important and were just routine documents that the company needed to complete their paperwork on my employment.” The balance of affidavit focuses on what she was not told. The agreement’s title which is all bolded, capitalized, underlined with enlarged fonts, reads: “ACUERDO DE ARBITRAJE Y NOTIFICACIÓN DE NUESTRA POLÍTICA DE ARBITRAJE” (and which translated means “Arbitration Agreement and Notice of Arbitration Policy”). The only affirmative representation that Martinez refers to is that she was told the documents were routine, which may well be true. Her conclusion that they were not important is either her own conclusion, or at best a subjective opinion that could not serve as a misrepresentation of a material fact.

*10 The facts of the case here are similar to those of Id.

Finding no sufficient evidence to sustain a procedural unconscionability claim, we reject that as a potential basis to have denied APC’s motion to compel arbitration.

Substantive Unconscionability

Martinez also raised below a substantive unconscionability claim, but only in the alternative. That is, she asks that if the trial court was going to enforce the arbitration clause, that it strike three specific parts of the arbitration agreement: (1) a one-year time limit on bringing claims,8 (2) limitations on discovery,9 and (3) a provision that forbids punitive or exemplary damages. The arbitration agreement contains a severability clause that would permit the court to jettison any provision that is adjudged to be “invalid, illegal, or unenforceable, in whole or in part[.]” Martinez carries this argument forward on appeal, asking this Court to strike those same provisions, or remand the matter back to the trial court to reconsider them.

Martinez principally relies on In re Poly-Am., L.P., 262 S.W.3d at 344.

The worker claimed that each of these ancillary provisions were substantively unconscionable. In re Poly-Am., L.P., 262 S.W.3d at 352.

*11 But the same court reached different conclusions on the fee splitting and discovery limitations. Noting that while fee splitting arrangements are not per se unconscionable, the court agreed that those which “operate to prohibit an employee from fully and effectively” vindicating their statutory rights are not enforceable. Id. at 358.

The arbitration agreement in Id.

We must also consider who should decide the unconscionability question. Three cases inform our decision. The U.S. Supreme Court recognized a distinction between questions of “substantive arbitrability”--which courts decide--and “procedural arbitrability”--which courts must refer to the arbitrators to decide. Id. at 81, 123 S.Ct. 588.

The Court reaffirmed that approach more recently in Howsam, 537 U.S. at 86, 123 S.Ct. 588.10

*12 Our supreme court adopted this same view in 458 S.W.3d at 511.

The court’s analysis is straightforward. Who decides disputes “is a question of the parties’ intent as expressed in their written agreement.” G.T. Leach court wrote:

In this case, the contractual deadline in the general contract falls squarely within the category of matters that ‘grow out of the dispute and bear on [the arbitrators’] final disposition of the claims. The deadline does not determine the present existence, enforceability, or scope of the agreement to arbitrate the parties’ disputes, but instead imposes a procedural limit on the parties’ rights under that agreement. It bears on the arbitrators’ final disposition of Sapphire’s claims--specifically, whether the arbitrators can award Sapphire a remedy on its negligence claims in light of Sapphire’s more than two-year delay in asserting them.

Id. at 521(internal cites and quotes omitted).

One-Year Time Limit

Martinez’s injury occurred on May 1, 2016. She first filed suit on November 27, 2017. The first request for arbitration in our record is APC’s motion to compel arbitration filed January 25, 2018. Her suit is timely under the Texas two-year statute of limitations, but perhaps not if the arbitration agreement’s one-year notice provision governs.

G.T. Leach court also wrote:

We do not hold that disputes over a contractual deadline in an arbitration agreement will always present questions of procedural arbitrability that arbitrators must decide. If a party contends, for example, that a contractual deadline renders the agreement to arbitrate unconscionable or that the deadline operates to limit the scope of the claims the parties agreed to arbitrate, those contentions might raise issues of substantive arbitrability for the courts to decide.

Id. at 522.

And that is exactly what Martinez raised in her response below. Moreover, she asserted at least some evidence that might be germane to that claim.

*13 Martinez’s alternative motion to strike the one-year time limit would have come into play, however, only if the trial court had ordered arbitration. Because the trial court declined to order arbitration at all, it necessarily never passed on the question of the one-year time limit. Thus, we are left with two alternatives: decide the question as a matter of first impression, or remand to the trial court for its consideration. We choose the latter course, mainly because unconscionability questions are circumstance dependent and not all the circumstances are developed on this record. Unlike the relatively sophisticated litigants in Serv. Corp. Int’l v. Ruiz, No. 13-16-00699-CV, 2018 WL 549196, at *9 (Tex.App.--Corpus Christi Jan. 25, 2018, pet. denied) (mem. op., not designated for publication) (remanding undecided question of unconscionability defense back to trial court based on the undeveloped record).

Punitive Damages

Conversely, we reject Martinez’s attack on the punitive damages clause in the arbitration agreement for one simple reason: her last amended petition did not assert any claim for punitive damages. That renders any opinion on the viability of punitive or exemplary damages at this point advisory. To the extent further discovery in the arbitration factually allows for such a claim, the arbitrator can resolve the legality of the remedy limitation.

Discovery Limitation

The arbitration agreement here limits the parties to one fact-witness deposition, but otherwise allows depositions of expert witnesses, the parties, and generally applies the Texas Rules of Civil Procedure. It also allows the arbitrator to relax these rules on a showing of good cause. Limits on discovery in arbitration provisions are typical and explain why arbitration is both quicker and less costly than litigation. See 262 S.W.3d at 357-58. Given that the discovery limitation clause here generally invokes the Texas Rules of Civil Procedure and has a good cause provision allowing the arbitrator to lift any restrictions, we conclude that any argument regarding unconscionability for the discovery limits here should be dealt with by the arbitrator.

CONCLUSION

APC’s first issue on appeal generally claims that the trial court erred in not granting its motion to compel arbitration. We sustain that issue. APC’s second issue challenges whether Martinez met her burden on raising a valid defense to the arbitration agreement. We sustain that issue, except for the possible issue of whether the one-year time limit is substantively unconscionable and should be severed from the agreement. That specific question is remanded to the trial court to decide consistent with this opinion. After making that decision, the case should be abated or dismissed with an order that the parties pursue arbitration under the terms of their agreement. APC’s third issue asked whether the trial court failed to consider undisputed evidence that arbitration is more cost effective than litigation. We do not consider that argument as part of Martinez’s raised defense below. It is not urged by Martinez as a grounds for affirmance, and even if so, we would reject that claim based both on the record here, and prior decisional law.

Footnotes

1

The original petition alleged the accident occurred on May 1, 2015, which would have been before the agreement was signed. An amended petition, however, changed that date to May 1, 2016, and the various medical records filed with the court also recite that the latter date as the actual date of injury.

2

We find the following exchange at the hearing:

THE COURT: You have a document with her signature on it?

[APC COUNSEL]: Yes, Your Honor.

THE COURT: And you’ve got a witness who would say, “Yes, I was there and saw her sign it”?

[APC COUNSEL]: Yes, Judge.

THE COURT: Okay. I mean, I think for now I’m going to find that she did sign it. So I don’t think you need to put on evidence on that issue.

3

This same trial court had made numerous fact findings on that topic in another case involving other litigants. See In re Shredder Co., L.L.C., 225 S.W.3d 676, 679 (Tex.App.--El Paso 2006, no pet.).

4

Whether the arbitration agreement is governed by the FAA or the Texas Arbitration Act, we have jurisdiction to hear an interlocutory appeal of the denial of a motion to compel arbitration. See TEX.CIV.PRAC. & REM.CODE ANN. § 171.098 (allowing appeal under the TAA).

5

While Martinez raised a number of defenses below, some have been collapsed together, and some have not been pursued on appeal. For instance, Martinez raised a 10th Amendment argument below that has not been briefed on appeal, likely because the Texas Supreme Court has expressly rejected it. In re Odyssey Healthcare, Inc., 310 S.W.3d 419, 423 (Tex. 2010) (orig. proceeding) (“[W]e conclude that the Federal Arbitration Act does not violate the Tenth Amendment by encroaching on a state power to enact and regulate its own workers’ compensation system.”). We appreciate counsel’s focus on the potentially viable remaining issues in the case.

6

The Supreme Court’s jurisprudence is not without strident dissenting opinions that question the reach of the Congress’s Commerce Clause power and its application to cases filed in state courts. See e.g. Southland Corp. v. Keating] entails a permanent, unauthorized eviction of state-court power to adjudicate a potentially large class of disputes.”). Martinez has preserved her challenges to this jurisprudence which we of course have no ability to grant.

7

The unconscionability defense has a long history at common law; an early decision described an unconscionable contract as one that “no man in his senses and not under delusion would make on the one hand, and as no honest and fair man would accept on the other.” Earl of Chesterfield v. Janssen, 28 Eng. Rep. 82, 100, 2 Ves. Sr. 125, 155 (1751), quoted in Venture Cotton Cooperative v. Freeman, 435 S.W.3d 222, 228 (Tex. 2014).

8

That provision reads:

One-Year Time Limit on Bringing a Claim: All parties must file a Claim for arbitration within one (1) year after the date of the incident or occurrence giving rise to the Claim. Failure to do so will result in the Claim being barred as at that one-year date. Should this time limitation become unenforceable because of applicable statute or case law, we and you agree the arbitrator may determine the appropriate limitations period in a pre-arbitration hearing, [bolding, underlining and punctuation original]

9

That clause provides that the Texas Rules of Civil Procedure generally apply, but each party can only depose the opposing party, one fact witness, and any expert designated by the opposing party. The arbitrator can relax this limitation upon a good cause showing.

10

The Court analogized the file-suit-first-then-wait-18-month requirement to other provisions that it and other courts had delegated to the arbitrators to decide. Lumbermens Mut. Cas. Co. v. Broadspire Management Servs., Inc., 623 F.3d 476, 481 (7th Cir. 2010) (requirement for filing pre-arbitration “Disagreement Notice”).

Court of Appeals of Texas, El Paso.

Robert CROYSDILL, Appellant,

v.

OLD REPUBLIC INSURANCE COMPANY, Appellee.

No. 08-19-00242-CV

|

December 9, 2019

Appeal from the 34th District Court of El Paso County, Texas (TC# 2013DCV1136)

Attorneys & Firms

Benjamin Lyles, for Old Republic Insurance Company.

Robert Croysdill, pro se.

Before Palafox, JJ.

MEMORANDUM OPINION

GINA M. PALAFOX, Justice

*1 Robert Croysdill, pro se, is attempting to appeal the trial court’s order granting partial summary judgment in favor of Old Republic Insurance Company on his breach of contract claim. We dismiss because the trial court’s order is not final for purposes of appeal, and because there is no apparent statutory authorization allowing for review of this interlocutory order.1

It is well settled that appellate courts have jurisdiction over final judgments, and such interlocutory orders as the Legislature deems appealable by statute. Lehmann, 39 S.W.3d at 205.

Here, the trial court order being challenged on appeal is not final because it does not dispose of all claims pending between the parties. Specifically, the order, captioned “Order Granting in Part Defendant’s Motion for Summary Judgment,” stated that the trial court granted Old Republic’s summary judgment as to the breach of contract claim but that it denied Old Republic’s motion for summary judgment seeking dismissal of Croysdill’s judicial review of the November 9, 2012, Decision and Order of the Hearing Officer before the Texas Workers’ Compensation Commission. The trial court’s order further provides that the “only remaining justiciable issue before this Court for consideration is whether the October 1997 work related injury extended to and caused Plaintiff chronic lumbar radiculitis.” Because the trial court’s order on its face indicates that a discrete justiciable issue remains pending before the trial court, we conclude that this order is not final for purposes of appeal.

At this stage of litigation, the trial court’s order is interlocutory because an unresolved issue remains pending between the parties. This Court cannot entertain interlocutory appeals except as authorized by statute. TEX.CIV.PRAC. & REM.CODE ANN. § 51.014 (main interlocutory appeal statute). Croysdill’s notice of appeal is premature at this time.

Once the trial court renders a judgment disposing of all claims between the parties, the trial court’s order will become appealable. Until then, we lack the jurisdiction to review the merits of the partial summary judgment granted on Croysdill’s breach of contract claim. Accordingly, we dismiss this appeal for want of jurisdiction.2

Footnotes

1

This Court previously sent a 10-day dismissal letter asking Appellant to explain this apparent jurisdictional defect. Following Appellant’s response, Appellee filed a motion to dismiss for want of jurisdiction.

2

Because we dismiss this appeal for want of jurisdiction, all remaining outstanding motions filed by Appellant and Appellee are overruled as moot.

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