Flying J Inc. v. Meda, Inc.

• Decision Date: 16 May 2012
• Docket Number: No. 04–08–00169–CV.,04–08–00169–CV.
• Citation: 373 S.W.3d 680
• Parties: FLYING J INC., Appellant v. MEDA, INC. d/b/a AAA Auger, Appellee.
• Court: Texas Court of Appeals

373 S.W.3d 680

FLYING J INC., Appellant

v.MEDA, INC. d/b/a AAA Auger, Appellee.

No. 04–08–00169–CV.

Court of Appeals of Texas, San Antonio.

May 16, 2012.

David E. Chamberlain, Catherine L. Kyle, Timothy B. Poteet, Chamberlain McHaney, Austin, TX, for Appellant.

Marc F. Wiegand, The Wiegand Law Firm PC, Bret L. Walton, David Klosterboer & Associates, Daniel P. Whitworth, Stump, Craddock, Massey & Farrimond, P.C. San Antonio, TX, Mike Thompson, Jr., Craig Andrew Nevelow, Wright & Greenhill, P.C., Austin, TX, for Appellee.

Sitting: CATHERINE STONE, Chief Justice, REBECCA SIMMONS, Justice, MARIALYN BARNARD, Justice.

OPINION

Opinion by: REBECCA SIMMONS, Justice.

Appellee Meda, Inc. sued appellant Flying J, Inc. for breach of contract. Flying J counterclaimed for breach of contract, breach of implied warranty, and negligence. On appeal, Flying J asserts (1) the trial court improperly directed a verdict against Flying J's breach of contract cause of action, (2) the trial court impermissibly commented on the weight of the evidence, (3) the trial court erroneously directed a verdict and refused to submit an issue to the jury on Flying J's breach of implied warranty cause of action, and (4) the evidence was legally and factually insufficient to support the jury's findings of negligence and apportionment of fault. We affirm the trial court's judgment.

Background

Flying J, a gasoline retailer, contracted with Meda, a plumbing company, to repair a water line at a Flying J facility. Meda performed work on the water line in July of 2001 and February of 2002. On these occasions Meda became aware that the water line was located in the same trench as and in close proximity to a diesel line. In the form of written proposals, Meda twice recommended that the water line be moved away from the diesel line to avoid potential water contamination problems. Flying J refused to implement these proposals.

Meda was again called to repair the leaking water line on June 17, 2002. Meda witnesses testified that on June 18 while excavating, Meda asked a Flying J manager to turn off the water supply to increase visibility in the excavated area and to enable construction of a cement thrust block that would strengthen the plumbing repairs. Meda witnesses testified that Flying J refused to shut off the water; Flying J disputes this testimony. Meda made the repairs to the existing water line and discovered a new leak further down the pipe. Meda began further excavation of the trench to make the replacement. There was testimony that Flying J's manager instructed the Meda plumbers to use a backhoe to expedite the repairs. Meda used the backhoe, which scraped the diesel line, and created a small puncture in the fuel line.

Meda temporarily halted its work while a third party repaired the fuel line. A Meda witness testified that the water line was repaired within twenty-four hours of puncturing the diesel line. The amount of diesel that spilled was hotly disputed at trial. Meda contends only several cups escaped the line and presented evidence that there was diesel in the trench before the diesel line was punctured. Meda also submitted evidence of past diesel spills and Texas Commission on Environmental Quality reports that indicated Flying J had prior environmental remediation performed at that location for hydrocarbon contamination. Flying J contends twenty-five gallons of fuel leaked from the punctured line and that any prior diesel spills had been completely remediated before Meda hit the diesel line.

Despite the problems with the punctured diesel line, Flying J asked Meda to return on July 20, 2002, to move the water line out of the same trench as the diesel line—essentially the services proposed months earlier. Meda completed this work and submitted invoices for the services rendered. Flying J refused to pay on all work performed on and after June 17, 2002, contending that Meda caused property damages in excess of the amount owed for plumbing services.

Meda brought suit for breach of contract; Flying J counterclaimed for breach of contract, breach of implied warranty, and negligence. The trial court granted a partial directed verdict in favor of Meda and dismissed Flying J's breach of contract and breach of implied warranty causes of action. Meda's breach of contract and Flying J's negligence causes of action were submitted to the jury. The jury awarded Meda damages for Flying J's breach of contract. On the negligence claim, the jury found Flying J 80% responsible for damage to the fuel line and Meda 20% responsible. The trial court rendered judgment, and Flying J appeals.

Flying J's Breach of Contract Claim

Flying J contends the trial court improperly granted a directed verdict against Flying J's breach of contract claim. Flying J claims that Meda breached the contract as a matter of law and the damage to the diesel line gave rise to both breach of contract and tort causes of action. Meda responds that because the diesel line was not part of the subject matter of the contract, Flying J's cause of action sounds solely in tort.

A. Standard of Review of a Directed Verdict

“In reviewing a directed verdict, we decide whether there is any evidence of probative value to raise an issue of material fact on the question presented, and we review the evidence in the light most favorable to the person suffering the adverse judgment.” Exxon Corp. v. Emerald Oil & Gas Co., L.C., 348 S.W.3d 194, 220 (Tex.2011); accord Collora v. Navarro, 574 S.W.2d 65, 68 (Tex.1978); State Office of Risk Mgmt. v. Martinez, 300 S.W.3d 9, 12 (Tex. App.-San Antonio 2009, pet. denied). If a fact issue is raised on a material question, a directed verdict is not proper and the issue must go to the jury. See Exxon Corp., 348 S.W.3d at 220–21;Collora, 574 S.W.2d at 68;Martinez, 300 S.W.3d at 12.

B. The “Contort” Distinction

Determining whether a cause of action sounds in tort or contract is often difficult. See Jim Walter Homes, Inc. v. Reed, 711 S.W.2d 617, 617 (Tex.1986); Sw. Bell Tel. Co. v. DeLanney, 809 S.W.2d 493, 495 (Tex.1991) (Gonzalez, J., concurring) (“We have muddled the law of ‘contorts' and an all encompassing bright line demarcation of what constitutes a tort distinct from breach of contract has proven to be elusive”). To determine whether Flying J's cause of action sounds in contract, tort, or both, it is instructive to examine the progression of case law regarding the contract-tort distinction.

In Montgomery Ward & Co. v. Scharrenbeck, the Texas Supreme Court noted, “Accompanying every contract is a common-law duty to perform with care, skill, reasonable expedience and faithfulness the thing agreed to be done, and a negligent failure to observe any of these conditions is a tort, as well as a breach of the contract.” 146 Tex. 153, 157, 204 S.W.2d 508, 510 (1947) (emphasis added) (citation and internal quotation marks omitted).

In Jim Walter Homes, the court clarified and seemingly narrowed the “as well as” language used in Scharrenbeck. See Jim Walter Homes, 711 S.W.2d at 617–18. The court stated, “The contractual relationship of the parties may create duties under both contract and tort law. The acts of a party may breach duties in tort or contract alone or simultaneously in both. The nature of the injury most often determines which duty or duties are breached.” Id. at 618 (emphasis added) (citations omitted).

In DeLanney, the court further advanced the progression of contort jurisprudence by adopting a two-part test for determining whether a party's cause of action sounds in contract, tort, or both. See Sw. Bell Tel. Co. v. DeLanney, 809 S.W.2d 493, 494–95 (Tex.1991). A court (1) looks at the source of the duty giving rise to the injury, and (2) looks to the nature of the injury. Id.

Regarding the source of the duty:

If the defendant's conduct ... would give rise to liability independent of the fact that a contract exists between the parties, the plaintiff's claim may also sound in tort. Conversely, if the defendant's conduct ... would give rise to liability only because it breaches the parties' agreement, the plaintiff's claim ordinarily sounds only in contract.

Id. at 494;see also Peco Constr. Co. v. Guajardo, 919 S.W.2d 736, 738 (Tex.App.-San Antonio 1996, writ denied); see also Richardson v. Bigelow Mgmt., Inc., No. 05–06–00213–CV, 2007 WL 1139775, at *4 (Tex.App.-Dallas Apr. 18, 2007, no pet.) (mem. op.) (affirming a summary judgment disposing of a contract claim where the alleged breach of duty arose from common law, not the contract, and therefore the plaintiffs claim sounded in tort).

As to the nature of the injury, a plaintiff's cause of action is ordinarily contractual if the only loss or damage is to “the subject matter of the contract.” See DeLanney, 809 S.W.2d at 494;Jim Walter Homes, 711 S.W.2d at 618. Generally, in the context of a contract for the sale of goods, the subject matter of the contract is the product itself. See Mid Continent Aircraft Corp. v. Curry Cnty. Spraying Serv., Inc., 572 S.W.2d 308, 312–13 (Tex.1978) (“Distinguished from personal injury and injury to other property, damage to the product itself is essentially a loss to the purchaser of the benefit of the bargain with the seller.”); see also Equistar Chems., L.P. v. Dresser–Rand Co., 240 S.W.3d 864, 867 (Tex.2007). In the context of a service contract, the subject matter of the contract generally does not include other property that is not a part of the contract. See Goose Creek Consol. Indep. Sch. Dist. of Chambers & Harris Cntys., Tex. v. Jarrar's Plumbing, Inc., 74 S.W.3d 486, 495 (Tex.App.-Texarkana 2002, pet. denied) (“[T]he injury [that the damaged party] alleged, the invasion of sewage and sewer gas into the school buildings, constitutes an injury to property that was not the subject matter of the contract, ... namely the plumbing.”); Thomson v. Espey Huston & Assocs., 899 S.W.2d 415, 422 (Tex.App.-Austin 1995, no writ) (“[T]o the extent that the alleged...