Gulf Maritime Warehouse Co. v. Towers

• Decision Date: 01 July 1993
• Docket Number: No. 09-92-055,09-92-055
• Citation: 858 S.W.2d 556
• Parties: GULF MARITIME WAREHOUSE COMPANY, Appellant, v. Jarrett TOWERS, Sr., et al., Appellees. CV.
• Court: Texas Court of Appeals

Page 556

858 S.W.2d 556

GULF MARITIME WAREHOUSE COMPANY, Appellant, v. Jarrett TOWERS, Sr., et al., Appellees.

No. 09-92-055 CV.

Court of Appeals of Texas Beaumont.

July 1, 1993.

Rehearing Denied July 22, 1993.

Kurt Groten, Phillips & Akers, Andrew T. McKinney IV, Phillips & Akers, Houston, for appellant.

Richard L. Scheer, Strong, Pipkin, Nelson & Bissell, Beaumont, Sid S. Stover, Seale, Stover, Coffield & Bisbey, Jasper, Michael R. McGown, Weller, Wheelus & Green, Beaumont, Carmody Baker, Fulbright & Jaworski, Richard A. Sheehy, McFall & Sartwelle, Houston, for appellees.

Louis M. Scofield, Jr., Mehaffy & Weber, Beaumont, intervenor.

Before WALKER, C.J., and BROOKSHIRE and BURGESS, JJ.

OPINION

WALKER, Chief Justice.

This appeal comes from the 172nd Judicial District Court of Jefferson County, Texas, Hon. Donald J. Floyd, presiding. A jury, by ten-two verdict, found appellant Gulf Maritime one hundred percent (100%) liable for injuries suffered by Jarrett Towers, Sr. ("Towers"). Towers recovered a judgment in his favor for $2,212,929.58. Mary Towers, wife of Towers, recovered a judgment in her favor for $319,000 and Jarrett Towers, Jr., son, recovered a judgment in his favor for $120,833.33. Appellant, Gulf Maritime, makes its appeal. Other appellees appearing herein are Quantum Chemical, a defendant below, and Texas Employers Insurance Association, an intervenor below.

We reverse and remand this case to the trial court from whence it came for reason that the Hon. Donald J. Floyd, presiding, was disqualified by law to sit as a judge in this case. In view of our determination that Judge Floyd was disqualified, we make no address to the merits and substantive issues in this appeal. Our address shall be directed solely to the legal concerns requiring disqualification of the trial judge raised in point of error one.

Factually, Jarrett Towers, Sr., at the time of the accident resulting in his injuries, was working for Coastal Technicians, Inc. Coastal was in the business of contracting hired labor to various other companies. Towers was injured while working at the premises of appellant, Gulf Maritime Warehouse Company.

Appellant, Gulf, had facilities for handling, storing, packaging, and shipping various products. Appellee, Quantum Chemical Corporation, U.S.I. Division, produced plastic pellets and shipped them to Gulf Maritime in railroad hopper cars. Appellant, Gulf, using some of its own employees and some of the employees obtained from Coastal, unloaded these plastic pellets from the hopper cars. On September 30, 1988, Towers climbed a ladder to the top of a hopper car to open some hatches and apparently lost his balance and fell off onto the concrete below, sustaining serious injuries.

Appellee Towers filed his original lawsuit against appellant on October 19, 1989. On January 25, 1990, the Towers family, as plaintiffs, joined appellee Quantum as a defendant in the suit. On October 28, 1991, a jury was selected to hear this case and during the third day of trial appellant, Gulf, became aware that Judge Donald Floyd's wife was an employee of defendant, Quantum Chemical Corporation. Upon learning of this fact, appellant Gulf requested a hearing on the matter. Appellant, Gulf, learned that Judge Floyd's wife had been employed at Quantum Chemical for some fourteen years in a management position as Employee Relations Supervisor. Judge Floyd and his wife had been married for fifteen years. Resulting from her employment with Quantum Chemical Corporation, Mrs. Floyd receives a salary, owns stock in Quantum through its pension plan and its employee stock ownership plan, and/or a 401(k) plan.

When Gulf became aware of Judge Floyd's wife's employment with Quantum, Gulf asked the trial judge to disqualify himself pursuant to TEX.R.CIV.P. 18b. Without detail, suffice it to say that Gulf and Quantum were adverse to each other on a number of issues in the trial. When Gulf first raised the question of disqualification or recusal, Judge Floyd responded that he would recuse himself if Gulf so moved. Judge Floyd, having made this offer, changed his mind after lunch break and refused to step down. Judge Floyd stated, "I think that I can be fair and I won't recuse myself." From this statement we presume that the foremost consideration given by Judge Floyd was as to his ability to be fair. Fairness may be an issue on recusal but is of no consideration on the question of disqualification.

A judge's refusal to recuse is viewed on appeal by an abuse of discretion standard. J-IV Investments v. David Lynn Machine, Inc., 784 S.W.2d 106, 107 (Tex.App.--Dallas 1990, no writ); Petitt v. Laware, 715 S.W.2d 688, 692 (Tex.App.--Houston [1st Dist.] 1986, writ ref'd n.r.e.); TEX.R.CIV.P. 18a(f).

Regarding disqualification of a judge, we have two bases of consideration. First, is TEX. CONST. art. V, § 11 which states as follows:

Sec. 11. No judge shall sit in any case wherein he may be interested, or where either of the parties may be connected with him, either by affinity or consanguinity, within such a degree as may be prescribed by law, or when he shall have been counsel in the case ... (emphasis ours)

The second basis is TEX.R.CIV.P. 18b(1) which reads as follows:

(1) Disqualification. Judges shall disqualify themselves in all proceedings in which:

(a) they have served as a lawyer in the matter in controversy, or a lawyer with whom they previously practiced law served during such association as a lawyer concerning the matter; or

(b) they know that, individually or as a fiduciary, they have an interest in the subject matter in controversy; or

(c) either of the parties may be related to them by affinity or consanguinity within the third degree.

There is a distinction between Rule 18b(1)(b) and Rule 18b(2)(e). Rule 18b(2) deals with recusal as opposed to disqualification. Under the disqualification portion of Rule 18b the reference is to "an interest". Under the recusal section of Rule 18b(2)(e) the interest is described as a "financial interest". Is an "interest" under the disqualification portion of the rule different from a "financial interest" under the recusal section of the rule? We think not, for, the interest of a judge, in order that he may be disqualified, must, in general, be a direct pecuniary or property interest in the subject matter of litigation. City of Pasadena v. State, 428 S.W.2d 388 (Tex.Civ.App.--Houston [1st Dist.] 1967), overruled on other grounds, (concurring opinion on rehearing) 442 S.W.2d 325 (Tex.1969); see also, Narro Warehouse, Inc. v. Kelly, 530 S.W.2d 146, 149 (Tex.Civ.App.--Corpus Christi 1975, writ ref'd n.r.e.) (interest must be direct, real and certain, immediately resulting from the litigation in question); Moody v. City of University Park, 278 S.W.2d 912, 919 (Tex.Civ.App.--Dallas 1955, writ ref's n.r.e.) (judge must stand to gain or lose a measurable benefit as direct consequence of suit); Wagner v. State, 217 S.W.2d 463, 464 (Tex.Civ.App.--San Antonio 1948, writ ref'd n.r.e.) (interest necessary to disqualify must be direct or pecuniary interest in subject matter of litigation). Once a pecuniary interest is shown to exist, the judge is disqualified no matter how slight the interest. See Cameron v. Greenhill, 582 S.W.2d 775, 776 (Tex.), cert. denied, 444 U.S. 868, 100 S.Ct. 142, 62 L.Ed.2d 92 (1979); Lindsley v. Lindsley, 152 S.W.2d 415, 433 (Tex.Civ.App.--Dallas 1941) (opinion on rehearing), rev'd on other grounds, 139 Tex. 512, 163 S.W.2d 633 (1942).

Where doubt exist as to a judge's interest that doubt should be resolved in favor of disqualification. Lindsley, 152 S.W.2d at 432. The Dallas Court of Civil Appeals provided further that the constitutional language "may be interested" implies that if there is doubt, the judge should be disqualified. Id.

Having a pecuniary or financial interest is certainly of foremost consideration. There are other concerns however which have been addressed by Justice Spear's concurring comments in Sun Exploration and Production Co. v. Jackson, 783 S.W.2d 202, 206 (Tex.1989): ¹

Public policy demands that the judge who sits in a case act with absolute impartiality. Pendergrass v. Beale, 59 Tex. 446, 447 (1883). Beyond the demand that a judge be impartial, however, is the requirement that a judge appear to be impartial so that no doubts or suspicions exist as to the fairness or integrity of the court. Aetna Life Ins. Co. v. Lavoie, 475 U.S. 813, 106 S.Ct. 1580, 89 L.Ed.2d 823 (1986); Marshall v. Jerrico, Inc., 446 U.S. 238, 100 S.Ct. 1610, 64 L.Ed.2d 182 (1980). The judiciary must strive not only to give all parties a fair trial but also to maintain a high level of public trust and confidence. Indemnity Ins. Co. v. McGee, 163 Tex. 412, 356 S.W.2d 666, 668 (Tex.1962). The legitimacy of the judicial process is based on the public's respect and on its confidence that the system settles controversies impartially and fairly. Judicial decisions rendered under circumstances that suggest bias, prejudice, or favoritism undermine the integrity of the courts, breed skepticism and mistrust, and thwart the very principles on which the judicial system is based. The judiciary must be extremely diligent in avoiding any appearance of impropriety and must hold itself to exacting standards lest it lose its legitimacy and suffer a loss of public confidence. Although the court reverses the trial court's judgment, it remains silent on the recusal question and thus fails to cure the perception of unfairness.

Although these stated concerns deal primarily with questions of recusal, we suggest that the concepts should be held foremost in the minds of all judges or justices in weighing our own participation and involvement in cases.

Appellee, Texas Employers Insurance Association, contends that appellant was unable to bring forth any evidence to show that Judge Floyd personally owned any financial interest in Quantum and that appellant's "community property" issue...