765 S.W.2d 784 (Tex. 1988), C-5499, Houston Lighting & Power Co. v. Reynolds

Docket Nº:C-5499.
Citation:765 S.W.2d 784
Party Name:HOUSTON LIGHTING & POWER COMPANY, Petitioner, v. Carol Ann Hauser REYNOLDS, Individually and as Natural Mother of Carl David Reynolds and Carl David Reynolds, Individually, Respondents.
Case Date:November 30, 1988
Court:Supreme Court of Texas
 
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Page 784

765 S.W.2d 784 (Tex. 1988)

HOUSTON LIGHTING & POWER COMPANY, Petitioner,

v.

Carol Ann Hauser REYNOLDS, Individually and as Natural

Mother of Carl David Reynolds and Carl David

Reynolds, Individually, Respondents.

No. C-5499.

Supreme Court of Texas.

November 30, 1988

Rehearing Denied March 29, 1989.

Joe R. Greenhill, Larry F. York, Austin, Stephen G. Tipps and Thomas R. Ajamie, Houston, Baker & Botts, for petitioner.

Donna Cywinski, McKenna & Cywinski, W. James Kronzer, George P. Hardy, III, Hardy, Milutin & Johns, Houston for respondents.

COOK, Justice.

Sixteen year old Carl David Reynolds was in a friend's backyard taking down a tent. He coupled eight 3-foot aluminum tent poles together in order to touch a powerline 26 feet and 9 inches above the ground. The powerline ran across an easement on his friend's backyard and carried 35,000 volts of electricity. Carl contacted the powerline after being warned by his friend that he might get shocked. The resulting injuries necessitated the amputation of both legs and one arm.

Reynolds sued Houston Lighting and Power, the owner of the powerline; Homecraft Land Development, the subdivision developers; Chicago Tents, the tent manufacturer; Vernon A. Henry and Associates, land planner; Putney, Moffat and Easley, subdivision engineers; and U.S. Home, the home builder. Before trial, Reynolds settled with U.S. Home and Homecraft Land Development for $700,000 plus a guarantee

Page 785

of an additional $1,300,000 if Reynolds did not receive that sum from the other defendants. All remaining defendants other than HL & P were non-suited.

The jury found against HL & P on the basis of strict liability pursuant to RESTATEMENT (SECOND) OF TORTS § 402A (1965) ("Section 402A") and conscious disregard of the welfare of Reynolds. The trial court rendered judgment on the jury verdict for $2,731,847.49 actual damages and $1,000,000 punitive damages. The court of appeals affirmed the judgment of the trial court. 712 S.W.2d 761.

The dispositive issues are: (1) whether electricity in a transmission line, prior to being transformed into voltage usable by a consumer, is a product; and (2) is such electricity in the stream of commerce.

We adopted Section 402A in our opinion in McKisson v. Sales Affiliates, Inc., 416 S.W.2d 787, 789 (Tex.1967). In order to recover for an injury on the theory of strict liability in tort, the plaintiff bears the burden of proving that the defendant: (1) placed in the stream of commerce a product; (2) that such product was in a defective or unreasonably dangerous condition; and (3) that there was a causal connection between such condition and the plaintiff's injuries or damages. Armstrong Rubber Co. v. Urquidez, 570 S.W.2d 374, 376 (Tex.1978).

The question of whether electricity in this case was a product is an issue of first impression for this court. Two Texas courts of appeals have addressed the question and reached conflicting results. In Erwin v. Guadalupe Valley Elec. Co-op., 505 S.W.2d 353, 355-56 (Tex.Civ.App.--San Antonio 1974, writ ref'd n.r.e.), the court assumed without discussion that electricity was a product. In Navarro County Elec. Co-op., Inc. v. Prince, 640 S.W.2d 398, 400 (Tex.App.--Waco 1982, no writ), the court held that electricity was not a product, rather, it was a service.

We agree with the better reasoned opinions of other jurisdictions which hold electricity to be a product. Electricity is a commodity, which, like other goods, can be manufactured, transported and sold. Pierce v. Pacific Gas & Elec. Co., 166 Cal.App.3d 68, 81, 212 Cal.Rptr. 283, 290 (1985). Electricity is a form of energy that can be made or produced by man, confined, controlled, transmitted and distributed to be used as an energy source for heat, power and light. Ransome v. Wisconsin Elec. Power Co., 87 Wis.2d 605, 610, 275 N.W.2d 641, 643 (1979).

Was the electricity which injured Carl Reynolds in the stream of commerce? The transmission line carried 35,000 volts of electricity. To be usable by a consumer the electricity had to be reduced by a transformer from 35,000 volts to 110-220 volts. Until the process was completed, the electricity was not transferred from HL & P's transmission line through a meter to the lines of a customer.

There is evidence that HL & P produced all of its electricity in response to anticipated demand. Further, once the electricity was placed in a transmission line it could not be recalled. However, this is not evidence that the electricity was delivered to any customer prior to transformation into a usable voltage.

Strict product liability applies only if a product is expected to and does reach the user without substantial change in the condition in which it is sold. Rourke v. Garza, 530 S.W.2d 794, 798 (Tex.1975). Following this reasoning, even if HL & P could be considered to have sold the electricity when it was...

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