Henderson v. Central Power and Light Co.

• Decision Date: 27 August 1998
• Docket Number: No. 13-97-194-CV,13-97-194-CV
• Citation: 977 S.W.2d 439
• Parties: Keith HENDERSON and Linda Henderson, Appellants, v. CENTRAL POWER AND LIGHT COMPANY, Appellee.
• Court: Texas Court of Appeals

Page 439

977 S.W.2d 439

Keith HENDERSON and Linda Henderson, Appellants, v. CENTRAL POWER AND LIGHT COMPANY, Appellee.

No. 13-97-194-CV.

Court of Appeals of Texas Corpus Christi.

Aug. 27, 1998.

Rehearing Overruled Oct. 1, 1998.

Thomas Patrick Gordon, III, Sandra Cockran Liser, Cantey & Hanger, Fort Worth, for Appellants.

V. Elizabeth Ledbetter, G. Don Schauer, Schauer, Simank & Ledbetter, Corpus Christi, for Appellee.

Before SEERDEN, C.J., and YANEZ and CHAVEZ, JJ.

OPINION

SEERDEN, Chief Justice.

Keith and Linda Henderson appeal from a judgment n.o.v. denying them any recovery on their DTPA ¹ claims against Central Power and Light Co. (CPL) for misrepresentations and unconscionable conduct concerning a power box that started a fire at the Henderson's house in Portland, Texas. We reverse and render judgment on the jury verdict.

The Hendersons purchased their Portland house in the late 1970s, had electrical service connected with CPL, and lived in the house for some eight or nine years, before they moved to Kansas and rented the house. At the time of the fire in January 1993, Tuffie and Vonnie Hudson rented and lived in the house and had electrical service from CPL reconnected in their name.

Electricity to the house flowed from electric lines belonging to CPL into a meter box assembly consisting of the meter base at which CPL's lines connected to lines flowing to the house, a cover to prevent access to the meter base, and an electric meter protruding through an opening in the enclosure. (See Photographs in Appendix A.) There was evidence in the record to suggest that the fire started due to corrosion at the point where the Hendersons' aluminum wires connected to the meter base. Although CPL claimed at trial that the meter enclosure and base belonged to the customer and should have been maintained by him, the enclosure was sealed by CPL and labeled with a warning to the customer not to open it.

CPL placed a seal on the meter enclosure which prevents access to the meter base and electrical connections by anyone other than CPL personnel. In addition to the seal, CPL also placed a warning label on the meter box, stating as follows: "WARNING Breaking the seal or tampering with this meter is hazardous and unlawful. Such acts will subject the customer to inspection and resealing charges, to damages and to prosecution. If removal of the seal is required, please call Central Power and Light Company."

Keith Henderson testified at trial that he never looked at the meter box other than to walk past it and see that it was there. He recalled that the meter box was sealed, and he assumed because of the seal that everything inside the box was CPL's property and that CPL would take care of it. Henderson further stated that he would have done something to maintain the connections in the meter box if he had known that it was his responsibility and that no one else was going to maintain them.

After the fire, certain Underwriters of Lloyds ("Lloyds") paid for damage to the Hendersons' home and joined the present action as their subrogee.

The Hendersons sued CPL for negligence, and for violations of the DTPA that were a producing cause of the fire. Specifically, the Hendersons claimed that CPL's seal locked them out of the meter enclosure and thereby led them to believe that its contents were being properly maintained by CPL, when in fact they were not.

The jury found that neither the Hendersons nor CPL were negligent, but did find that CPL engaged in a false, misleading or deceptive act or practice and in an unconscionable action or course of action that were producing causes of the Hendersons' damages.

CPL moved for judgment n.o.v. on the grounds that Lloyds, as the Hendersons' subrogee, was not a consumer and therefore not entitled to maintain the present DTPA cause of action, that the Hendersons were not consumers after they moved out of the house and rented to others, that no representation had been made by CPL that could have been a producing cause of the fire, and that a Public Utility Commission approved tariff relieved CPL of any duty to the Hendersons for maintenance of the wires and electrical equipment on the house.

The trial court granted CPL's motion for judgment n.o.v. and signed a take-nothing judgment denying all of the Hendersons' claims.

By their two points of error, the Hendersons and Lloyds complain that the trial court erred in disregarding the jury's findings and entering judgment n.o.v. against them on their claims against CPL for misleading and unconscionable conduct under the DTPA.

The law is clear that a judgment n.o.v. is proper only when the evidence is conclusive and one party is entitled to prevail as a matter of law, or when a legal principle precludes recovery. Mancorp, Inc. v. Culpepper, 802 S.W.2d 226, 227 (Tex.1990); Chachere v. Drake, 941 S.W.2d 193, 195 (Tex.App.--Corpus Christi 1996, writ denied); Reeves v. Western Co. of North America, 867 S.W.2d 385, 390 (Tex.App.--San Antonio 1993, writ denied). Therefore, when reviewing a judgment n.o.v., we must review the evidence in the light most favorable to the jury's findings, considering only the evidence and inferences supporting them and rejecting the evidence and inferences contrary to the findings. Mancorp, 802 S.W.2d at 227; Navarette v. Temple Indep. Sch. Dist., 706 S.W.2d 308, 309 (Tex.1986). Furthermore, we must reverse where there is more than a scintilla of competent evidence to support the jury's findings. Mancorp, 802 S.W.2d at 228; Southern States Transp., Inc. v. State, 774 S.W.2d 639, 640 (Tex.1989).

However, when the motion presents multiple grounds for judgment n.o.v. and the trial court fails to state the grounds on which it granted judgment n.o.v., the appellant has the burden of showing that the judgment cannot be sustained on any of the grounds stated in the motion. Fort Bend County Drainage Dist. v. Sbrusch, 818 S.W.2d 392, 394 (Tex.1991) (citing Monk v. Dallas Brake & Clutch Serv. Co., 697 S.W.2d 780, 783-84 (Tex.App.--Dallas 1985, writ ref'd n.r.e.)).

In the present case, the only reason asserted by the trial court for granting judgment n.o.v. was that "there is no evidence of probative force to sustain the verdict of the jury on D.T.P.A. questions 3 and 4 [which broadly submitted the DTPA theories of liability], and that a directed verdict in favor of Central Power and Light Company would have been proper." This leaves uncertain whether the trial court granted judgment n.o.v. because there was no evidence to show the necessary consumer status of the plaintiffs, no evidence of a misrepresentation, or no evidence to defeat the limitation of liability provisions of the tariff, all of which would negate the jury's findings on DTPA liability. Accordingly, we must address all possible grounds for the trial court to have granted judgment n.o.v.

Consumer Status of Lloyds

CPL initially challenged the right of Lloyds to step into the Hendersons' shoes in asserting DTPA claims against CPL, on the ground that Lloyds has assets of more than $25 million and cannot be a DTPA consumer, even if the Hendersons were consumers.

Only a "consumer" has standing to sue under the DTPA. See TEX. BUS. & COM.CODE ANN. § 17.50 (Vernon 1987); Flenniken v. Longview Bank & Trust Co., 661 S.W.2d 705, 706 (Tex.1983); McAllen State Bank v. Linbeck Const. Corp., 695 S.W.2d 10, 21-24 (Tex.App.--Corpus Christi 1985, writ ref'd n.r.e.). The DTPA defines a consumer as "an individual, partnership, corporation, this state, or a subdivision or agency of this state who seeks or acquires by purchase or lease, any goods or services, except that the term does not include a business consumer that has assets of $25 million or more, or that is owned or controlled by a corporation or entity with assets of $25 million or more." TEX. BUS. & COM.CODE ANN. § 17.45(4) (Vernon 1987).

There is no dispute that Lloyds has assets of more than $25 million and that it could not by itself maintain consumer status in an independent action under the DTPA. CPL argues that Lloyds, as subrogee, must also independently meet the requirements of the DTPA with regard to this requirement of consumer standing. See Trimble v. Itz, 898 S.W.2d 370, 372 (Tex.App.--San Antonio), writ denied, 906 S.W.2d 481 (Tex.1995).

The court in Itz concluded that the legislature, having made no exception for subrogees in the statute, did not intend to allow an insurer/subrogee with more than $25 million in assets to sue under the DTPA. Accordingly, the Itz court required the insurer to qualify as a consumer in its own right and did not allow it to assume the consumer status of its insured/subrogor for purposes of pursuing a DTPA claim. Itz, 898 S.W.2d at 372. CPL fails to mention that in denying writ on Itz, the Texas Supreme Court specifically stated that it "neither approves nor disapproves of the court of appeals' discussion of the Deceptive Trade Practices Act." Trimble v. Itz, 906 S.W.2d 481 (Tex.1995) (per curiam).

Nevertheless, even assuming that Itz is correct, the present case may be distinguished by the fact that the original consumers, the Hendersons are plaintiffs in this lawsuit, seeking their damages against CPL. Even Itz recognized the right of an insurer to pursue a valid subrogation claim in a DTPA lawsuit brought by its insured/subrogor. Itz, 898 S.W.2d at 372 (citing McAllen State Bank, 695 S.W.2d at 24 n. 5, where the bank's insurer/subrogee intervened in the action and asserted its own subrogation claim under the DTPA).

Therefore, in the present case, we hold that Lloyds properly joined its subrogation claim to the Hendersons' own DTPA claim against CPL, and that Lloyds, through the Hendersons, has consumer status under the DTPA.

Consumer Status of the Hendersons

CPL next argued that the Hendersons were not consumers, because it did not provide electrical power to them.

Whether a plaintiff is a consumer under the DTPA is a question of law for the trial court to...