Hygeia Dairy Co. v. Gonzalez, 04-96-00651-CV

Decision Date21 April 1999
Docket NumberNo. 04-96-00651-CV,04-96-00651-CV
Citation994 S.W.2d 220
Parties(Tex.App.-San Antonio 1999) HYGEIA DAIRY CO., Appellant v. Abelardo GONZALEZ, Appellee
CourtTexas Court of Appeals

From the 79th Judicial District Court of Jim Wells County, Texas Trial Court No. 94-06-32742, Honorable Walter Dunham Jr., Judge Presiding

[Copyrighted Material Omitted] Sitting: Phil Hardberger, Chief Justice, Tom Rickhoff, Justice, Alma L. Lopez, Justice, Catherine Stone, Justice, Paul W. Green, Justice, Sarah B. Duncan, Justice, Karen Angelini, Justice

ON APPELLEE'S MOTION FOR REHEARING EN BANC

Opinion by:Tom Rickhoff, Justice

APPELLEE'S MOTION FOR REHEARING EN BANC GRANTED; AFFIRMED IN PART; REVERSED AND REMANDED IN PART

Appellee's motion for rehearing en banc is granted. We withdraw the panel opinion of September 23, 1998 and substitute this en banc opinion in its place.

In this action over the sale of a herd of dairy cattle, we find error in the trial court's failure to instruct the jury on mitigation.

Hygeia Dairy Co. ("Hygeia") sold 51 head of dairy cattle to Abelardo Gonzalez in April 1991; these cattle were incorporated into his existing herd. Gonzalez later bought some more cattle from another supplier. In 1993 and early 1994, Gonzalez's cattle began to die, forcing him to liquidate his herd at the end of 1994.

Gonzalez filed suit against Hygeia alleging negligence and gross negligence for failing to disclose that Hygeia's herd had contained diseased cattle. Trial was to a jury, which found Hygeia negligent and grossly negligent and Gonzalez 35% contributorily negligent. The jury assessed actual damages at $291,000 and punitive damages at $3,000,000. The trial court reformed the punitive damage award to conform to TEX. CIV. PRAC. & REM. CODE ANN. 41.007, subtracted Gonzalez's contributory negligence from the actual damages award, added prejudgment interest and entered judgment for $1,419,501.98.

In four issues Hygeia complains that: 1) the trial court erred in not including an instruction on mitigation of damages; 2) there is legally or factually insufficient evidence to support a finding of gross negligence; 3) Hygeia owed no duty to disclose the presence of common diseases in the herd of cattle in question; 4) a new trial should be ordered because of deficiencies in the statement of facts. Because we find that Hygeia was entitled to an instruction on mitigation of damages, we reverse the judgment of the trial court and remand the case for retrial.

FACTS

Hygeia sold Gonzalez 51 head of cattle in April 1991. Gonzalez testified he was seeking to improve his herd's average milk production with the purchase and so picked out the best milk producers. Hygeia officials testified their dairy had decided to get out of the raw milk business and was in the process of liquidating its 1800-cow milking herd.

Gonzalez went to Hygeia's dairy operation and picked milk cows according to their milk production. He testified he asked the manager for "good cattle that are healthy and are producing milk." Gonzalez got milk production records for the cows he selected and brucellosis test results for most; he testified other promised medical records were never provided.

The crux of Gonzalez's cause of action is Hygeia's admission that two diseases - bovine leukosis and Johne's disease - were present in its herd at the time of Gonzalez's purchase. Testimony showed that bovine leukosis, also known as bovine leukemia, is a viral disease transmitted by parasites which causes cancerous nodules in the bodies of afflicted cattle and that Johne's disease is a bacterial disease characterized by a "wasting" of an afflicted animal and bloody diarrhea. According to experts at trial, these diseases are incurable and it is often easier to slaughter a herd and start over than to eradicate the diseases from an existing herd. Testimony also showed both diseases can be difficult to detect, in part because they can reside in an animal without causing symptoms for extended periods of time. Hygeia's experts argued these diseases are prevalent in many Texas dairy herds and that they can be managed with an aggressive management program, which would include culling cattle that show symptoms. Gonzalez's former veterinarian, Dr. Michael Vickers, testified he never treated a cow in Gonzalez's herd for these diseases prior to his purchase of cattle from Hygeia; neither he nor Gonzalez's current veterinarian, Dr. Glynn Wilkinson, said they had seen these diseases around Falfurrias.

Gonzalez testified his cattle started to drop off in milk production in 1993, and some of his cows began to suffer from bloody diarrhea and "wasting." Both Gonzalez and Wilkinson testified they had the most trouble with cattle from the Hygeia Dairy; in May 1994, seven of eight former Hygeia cattle tested positive for bovine leukosis. Gonzalez estimated that by July of 1994 more than half of the Hygeia cattle were dead. However, no autopsies were done on cows that were lost, and no blood testing was done before May 1994. After seeing production drop below his break-even point, even with reinforcements from another dairy, Gonzalez sold his herd for slaughter in December 1994.

THE RECORD

In its fourth issue, Hygeia complains that the record is too inaccurate to be relied upon, and that it should therefore be granted a new trial. TEX. R. APP. P.34.6(f). This court examined the matter of the reporter's record in a mandamus proceeding and found that the court reporter satisfied her obligation to submit and certify the record in this case. Hygeia does not offer any evidence that the record is indeed missing, deficient, lost or destroyed; without such evidence, it would be improper for this court to reverse and remand. See Owens-Illinois, Inc. v. Chatham, 899 S.W.2d 722, 727 (Tex. App.-Houston [14th Dist.] 1995, writ dism'd); cf. Gillen v. Williams Brothers Constr. Co., 933 S.W.2d 162, 163 (Tex. App.-Houston [14th Dist.] 1996, writ denied).

THE QUESTION OF DUTY

In its third issue, Hygeia complains the trial court erred in submitting the cause to the jury because it owed no duty to disclose diseases common to most dairy herds.

The threshold inquiry in a negligence case is duty. El Chico Corp. v. Poole, 732 S.W.2d 306, 311 (Tex. 1987). The question of duty turns on the foreseeability of harmful consequences, which is the underlying basis for negligence. Corbin v. Safeway Stores, Inc., 648 S.W.2d 292, 296 (Tex. 1983). Forseeability means that a person of ordinary intelligence should have anticipated the dangers that his negligent act created for others. Missouri Pac. R. Co. v. American Statesman, 552 S.W.2d 99, 103 (Tex. 1977). The existence of a duty is a question of law for the court to decide from the facts surrounding the occurrence in question. Walker v. Harris, 924 S.W.2d 375, 377 (Tex. 1996); Greater Houston Transp. Co. v. Phillips, 801 S.W.2d 523, 525 (Tex. 1990).

In determining the question of duty, the court will consider several interrelated factors, including the risk, forseeability, and likelihood of injury weighed against the social utility of the actor's conduct, the magnitude of the burden of guarding against the injury, and the consequences of placing the burden on the defendant. Phillips, 801 S.W.2d at 525 (quoting Otis, 668 S.W.2d at 309).

We believe the evidence adduced at trial supports the trial court's implicit determination that Hygeia was under a duty to reveal all diseases present in its herd at the time of Gonzalez's purchase. Gonzalez testified that he asked for healthy cows he also notes that he did not have a chance to inspect the 300 or so cows Hygeia sold for slaughter instead of as milk producers. The uncontroverted testimony is that buying diseased cows and mixing them with a new herd creates a risk of infection among uninfected cows. There was also testimony from Dr. Collins that a reasonably prudent dairy farmer with Johne's disease in his herd would not sell milking cows to another dairy farmer without disclosing that disease, because the disease can spread throughout a herd and because it is so difficult to eliminate from a herd. Dr. Collins also disputed Hygeia's contention that these diseases are present in nearly every dairy herd in Texas.

We also note that Hygeia's own experts testified that Johne's disease and bovine leukosis can be controlled through an aggressive herd management program. We do not know how Gonzalez could aggressively manage these new diseases if he did not know these diseases had come into his herd.

Essentially, by arguing that it had no duty to reveal the presence of these diseases, Hygeia is seeking to place the loss in this transaction on an invincibly ignorant party, which we decline to do. We therefore find that, when selling cows for milk production, Hygeia was under a duty to disclose the presence of communicable diseases of which it was actually aware which could substantially harm the productivity of a purchaser's existing herd. Hygeia's third issue is overruled.

MITIGATION OF DAMAGES

In its first issue, Hygeia complains the trial court erred in not submitting an issue to the jury on mitigation of damages. Hygeia argues that when Gonzalez started to lose cattle, he failed to test the dead and dying animals to determine exactly what was causing the deaths, which a reasonably prudent dairy farmer would have done. Hygeia argues this evidence entitled them to a mitigation of damages instruction for the jury. We agree.

The trial court must submit questions, instructions and definitions which are raised by the pleadings and the evidence. See TEX. R. CIV. P. 278. A mitigation of damages instruction is proper when the negligence complained of merely contributed to or added to the extent of the losses or injuries, but has no part in causing the incident in question. Elbaor v. Smith, 845 S.W.2d 240, 245 (Tex. 1992); Kerby v. Abilene Christian College, 503 S.W.2d 526, 528 (Tex. 1973). In this way, the law...

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