Coastal Trans., Inc. v. Crown Cent. Petro.

• Citation: 136 S.W.3d 227
• Decision Date: 14 May 2004
• Docket Number: No. 01-0301.,01-0301.
• Parties: COASTAL TRANSPORT COMPANY, INC., Petitioner, v. CROWN CENTRAL PETROLEUM CORP., Respondent.
• Court: Supreme Court of Texas

136 S.W.3d 227

COASTAL TRANSPORT COMPANY, INC., Petitioner, v. CROWN CENTRAL PETROLEUM CORP., Respondent.

No. 01-0301.

Supreme Court of Texas.

Argued on December 4, 2002.

Decided May 14, 2004.

[136 S.W.3d 229]

Wayne Fisher, pro se.

David M. Heilbron, for Amicus Curiae General Motors Corporation.

Richard P. Hogan Jr., for Amicus Curiae Mel Anthony Harper, et al.

Henry S. Platts, Wilton F. Chalker, Henry S. Platts, for other interested parties.

Robert B. Dubose, Robert M. Greenberg, Dana C. Livingston Cobb, Robert E.

Motsenbocker, for Coastal Transport Company, Inc.

Robert M. Roach Jr., for Coastal Transport, Inc.

John L. Hagan, M. Michael Meyer, for Crown Central Petroleum Corp.

Justice SCHNEIDER delivered the opinion of the Court.

In this case, Crown Central Petroleum Corporation sued Coastal Transport for negligence and gross negligence after a Coastal gasoline truck caused a fire that destroyed a Crown Central gasoline-loading facility. We must decide whether Coastal waived its right to complain that there is legally insufficient evidence of gross negligence. The court of appeals held that Coastal's failure to object to the admission of expert testimony on gross negligence waived any complaint that the testimony had no probative value. 38 S.W.3d 180, 190. We disagree.

We conclude that such an objection is required only when a challenge to expert testimony questions the underlying methodology, technique, or foundational data used by the witness. A Daubert/Robinson challenge to the reliability of a scientific process or technique, for example, must be timely made in order to allow the court to exercise its gatekeeper function. Maritime Overseas Corp. v. Ellis, 971 S.W.2d 402, 411 (Tex.1998). In this case, however, Coastal does not challenge the particular methodology underlying the expert testimony; instead, Coastal simply argues that the testimony is non-probative on the face of the record. Consequently, we hold that Coastal did not waive its challenge to the legal sufficiency of the evidence. After reviewing the record, we conclude that there is legally insufficient evidence to support Crown Central's gross-negligence claim. We therefore reverse the judgment of the court of appeals and render judgment that Crown Central take nothing.

I. Background

Crown Central Petroleum Corporation owned a bulk loading facility in Pasadena, Texas, where gasoline and petroleum products were pumped into tank transport trucks. In September 1993, a Coastal Transport Company truck driver was loading a Coastal truck at the facility. The driver attempted to put more gasoline in the truck than the truck could hold. Because gasoline loads into the trucks at 500 to 600 gallons per minute, the overfill resulted in the spill of more than a hundred gallons of gasoline. An engine in a nearby truck ignited gasoline vapors from the spill. The ignition caused an explosion and fire that destroyed the facility and severely burned the driver.

Coastal's trucks were equipped with probes that were designed to sense when the gasoline tanks were full and to prevent additional gasoline from being pumped into an already-full tank. However, the probe in this case malfunctioned, and failed to prevent the tank from being overfilled. Crown Central filed suit, alleging that Coastal was negligent in failing to train its drivers in proper loading methods and in failing to maintain and equip its trucks in a manner that would prevent overfill.

Crown Central also alleged that Coastal was aware of defective probes in its fleet and failed to inspect or replace them. Crown Central argued that Coastal's failure to replace probes it knew to be defective demonstrated that its breach of care was committed in a wanton and willful manner, and that it was therefore entitled to an award of exemplary damages.

At a jury trial, after Crown Central completed its case-in-chief, the trial court granted Coastal's motion for a directed verdict on the ground that the evidence did not support a finding of gross negligence, thus disallowing Crown Central's claim for exemplary damages. Crown Central's remaining negligence claim against Coastal was submitted to the jury.

The jury found that Coastal was negligent and that its negligence proximately caused the accident; it allocated 75 percent of the responsibility to Coastal and 25 percent to the manufacturer of the probes. The jury also found that Crown Central's injury was temporary rather than permanent. The jury found that $894,363 would reasonably compensate Crown Central for the loss of its facility, and the trial court therefore held Coastal liable for 75 percent of this amount, or $670,773. Coastal elected to reduce the amount of damages by a credit equal to the dollar amount of Crown Central's prior settlement with another party. Act of June 16, 1985, 69th Leg., R.S., ch. 959 § 1, 1985 Tex. Gen. Laws 3271, repealed by Act of June 11, 78th Leg., R.S., ch. 204, § 4.10(6), 2003 Tex. Gen. Laws 859. Because the settlement amount was larger than the award of damages, the trial court rendered a take-nothing judgment.

Crown Central appealed the trial court's judgment, arguing that the jury's finding on the permanence of its damages was against the great weight and preponderance of the evidence or, alternatively, that the damages should be considered permanent as a matter of law. Crown Central also argued that the trial court's directed verdict in Coastal's favor on the issue of exemplary damages was erroneous.

The court of appeals affirmed the jury's finding that Crown Central's injury was temporary, but reversed the trial court's directed verdict on the issue of exemplary damages. 38 S.W.3d 180, 191. The court of appeals noted that Crown Central presented evidence of gross negligence through the testimony of one of its expert witnesses, Arthur Atkinson, who testified that, in his opinion, Coastal acted with conscious indifference toward a risk of which it was subjectively aware. Id. at 189-90. The court then concluded that our decision in Maritime Overseas Corp. v. Ellis, 971 S.W.2d 402 (Tex.1998), in which we held that a party who fails to object to expert opinion testimony as unreliable before or during trial may not attack the scientific reliability of its opponent's experts after a verdict has been issued, precluded Coastal's no-evidence challenge on the issue of gross negligence. 38 S.W.3d at 189-90. The court of appeals therefore held that there was sufficient evidence of gross negligence to overcome a directed verdict on exemplary damages, and remanded the case to the trial court. Id. at 191.

Coastal filed a petition for review in this Court, contending that the court of appeals misapplied the holding of Maritime Overseas. Coastal also claims that Crown Central's evidence of gross negligence is legally insufficient. Crown Central filed a cross-petition for review, claiming the court of appeals erred in determining that its injuries were temporary rather than permanent.

II. Coastal's Legal Sufficiency Challenge

Coastal argues that there is no evidence in the record to support Crown Central's allegation of gross negligence. In Transportation Insurance Co. v. Moriel, we explained that gross negligence involves two components: (1) viewed objectively from the actor's standpoint, the act or omission complained of must involve an extreme degree of risk, considering the probability and magnitude of the potential harm to others; and (2) the actor must have actual, subjective awareness of the risk involved, but nevertheless proceed in conscious indifference to the rights, safety, or welfare of others. Transp. Ins. Co. v. Moriel, 879 S.W.2d 10, 23 (Tex.1994). In this case, the parties' dispute centers on the second prong C specifically, whether there was evidence that Coastal was consciously indifferent to the risk of harm.

Crown Central argues that the testimony of its trucking-safety expert, Arthur Atkinson, provides some evidence of conscious indifference; Crown Central notes that Coastal did not object either to Atkinson's qualifications or to the reliability of his testimony. Crown Central argues that a particular colloquy, in which Atkinson opined on the elements of gross negligence, provided "some evidence" of each of the elements of gross negligence:

Q: When viewed objectively from Coastal's point of view at the time of the September '93 incident, in your opinion, did Coastal's failure to stop using probes that could have [sensor failure] problems, did that involve a high degree of risk, considering the probability and magnitude of the potential harm to others?

A: Yes, it did, very high.

Q: In your opinion, did Coastal have an actual subjective awareness of the risk involved in failing to stop using probes that can have [sensor failure] problems?

A: Yes, again and again.

Q: And in your opinion, did Coastal nevertheless proceed with conscious indifference to the rights, safety, or welfare of others?

A: That's the only conclusion I can draw.

Coastal, on the other hand, argues that Atkinson's testimony amounted to no more than a "bare conclusion" that was "factually unsubstantiated" and therefore constituted no evidence of conscious indifference to support Crown Central's gross negligence claim. Relying upon our opinion in Maritime Overseas, the court of appeals held that Coastal waived its right to assert "that such expert testimony constituted no evidence to support a finding of gross negligence" because it did not object to the quoted colloquy as unreliable. 38 S.W.3d at 190. We disagree that an objection is needed to preserve a no-evidence challenge to conclusory expert testimony.

We noted in Burrow v. Arce that, although expert opinion testimony often provides valuable evidence in a case, "it is the basis of the witness's opinion, and not the witness's qualifications or his bare opinions alone, that can settle an issue as a matter of law; a claim will not stand or fall on the mere ipse...