In re Cordish Co.

• Decision Date: 21 January 2021
• Docket Number: NO. 14-20-00676-CV,14-20-00676-CV
• Citation: 617 S.W.3d 909
• Parties: IN RE the CORDISH COMPANY and Bayou Place, L.P., Relators
• Court: Texas Court of Appeals

617 S.W.3d 909

IN RE the CORDISH COMPANY and Bayou Place, L.P., Relators

NO. 14-20-00676-CV

Court of Appeals of Texas, Houston (14th Dist.).

Opinion filed January 21, 2021

Rehearing En Banc Denied March 11, 2021

Michael Scott Beckelman, Marjorie C. Nicol, Houston, for Relators.

Jason A. Itkin, Noah Wexler, Owen McGovern, Russell S. Post, Brant Jeffrey Stogner, Jennifer Stogner, Houston, for Real Party in Interest.

Panel consists of Chief Justice Christopher and Justices Jewell and Zimmerer.

Kevin Jewell, Justice

Relators The Cordish Company and Bayou Place, L.P. filed a petition for writ of mandamus asking this court to compel the Honorable Michael Gomez, presiding judge of the 129th District Court of Harris County, to vacate his July 27, 2020 order denying relators' amended motion to designate the United States Army Corps of Engineers (the "Corps") as a responsible third party pursuant to Civil Practices and Remedies Code section 33.004. We conditionally grant relief.

Factual and Procedural Background

The underlying lawsuit was filed by plaintiff Norberto Valles, and joined by intervenors Undrea Bailey, individually and as next friend of J.B., and Lillian Bailey. We refer to the Valles and Bailey parties collectively as the real parties in interest. It is alleged that in the aftermath of Hurricane Harvey, waters from nearby Buffalo Bayou flooded the underground parking garage beneath Bayou Place in downtown Houston and damaged electrical equipment. Real parties in interest alleged that relators' and other co-defendants' negligence injured two electricians—Norberto Valles and Undrea Bailey—while they attempted to repair the equipment. As a result of arcing and an explosion, Valles and Bailey suffered severe burns over thirty percent of their bodies.

Relators filed a motion to designate the Corps as a responsible third party. See Tex. Civ. Prac. & Rem. Code § 33.004. The trial court denied the motion but granted relators leave to amend their allegations. Relators then filed an amended motion, which alleged among other things:

1. Bayou Place, where plaintiffs sustained their injuries, is located in downtown Houston, directly adjacent to Buffalo Bayou.

2. Hurricane Harvey made landfall on the Texas Gulf Coast on August 25, 2017, then stalled over "[t]he Houston Metro ... torrential rains fell in these locations near a stationary front." [sic]

3. The Corps operates two reservoirs known as the Addicks and Barker Reservoirs ("the Reservoirs"), upstream from Bayou Place. The Reservoirs captured Hurricane Harvey floodwaters during Hurricane Harvey and filled rapidly. Concerned by rising water levels in the Reservoirs, on August 28, 2017, the Corps began releasing floodwaters from the Reservoirs into Buffalo Bayou.

4. On August 29, 2017, the Corps "made increased controlled releases ... to maintain control of the Addicks and Barker Dams." Prior modeling prepared by the Corps projected that the amount of water it was releasing would flood areas downstream, including Bayou Place.

5. As predicted by the Corps, floodwaters inundated Bayou Place.

6. The Corps's decision as to the volume and timing of the Reservoir releases contributed to the severity of downtown Houston flooding. Governmental reports concluded that "[d]ownstream flooding due to dam releases" occurred. The Harris County Flood Control District concluded that "[w]ater level elevations and duration were influenced by the Corps' emergency releases during the extreme rainfall event as well as the subsequent releases to empty the Addicks and Barker Reservoirs."

7. The Corps's operation of the Reservoirs during Hurricane Harvey, including the volume and timing of water releases, caused floodwaters to inundate electrical equipment located in Bayou Place garage. No electrical equipment, or less electrical equipment, including the equipment that injured plaintiffs, would have been damaged absent the Corps's actions. The severity of damage to the equipment that injured the plaintiffs was exacerbated because floodwaters inundated electrical equipment for a longer period of time than would have occurred had the Corps operated the Reservoirs differently, released less water, or released water at a lower flow rate. Thus, according to relators, the Corps's "conduct and release of excessive floodwaters ... caused the defect causing the Plaintiffs' injuries."

8. Plaintiffs were injured while attempting to repair the electrical equipment in Bayou Place that had been inundated when an "electrical accident" occurred.

9. Texas law imposes liability on governmental entities based on their exercise of control over waters resulting in damages downstream, even if such control causes damages on premises not owned by the governmental entity, or from waters not owned by the governmental entity. Tex. Parks & Wildlife v. Wilson , 991 S.W.2d 93 (Tex. App.—Austin 1999, pet. denied).

10. The Corps's decisions and conduct was the sole proximate cause, or a proximate cause, or a substantial contributing factor of plaintiffs' injuries; the Corps was negligent; the Corps exercised control over the water, premises, and equipment at issue that renders them responsible; the Corps's design and failure to mitigate known flood-risks associated with extreme floodwater discharge rates of the Reservoirs rendered the Reservoirs defective or unreasonably dangerous; and, as a result, the Corps violated applicable legal standards.

Real parties in interest filed timely objections to relators' amended motion to designate the Corps as a responsible third party, arguing that relators cannot establish "legal cause" as to the proposed responsible third party because relators cannot and do not allege that the Corps "[did] more than furnish the condition that makes the plaintiff's injury possible." Union Pump Co. v. Allbritton , 898 S.W.2d 773, 776 (Tex. 1995).

On July 27, 2020, the trial court signed an order sustaining the objections and denying leave to designate the Corps as a responsible third party. Relators seek mandamus relief in this court.

Mandamus Standard

To obtain mandamus relief, a relator generally must show both that the trial court clearly abused its discretion and that the relator has no adequate remedy by ordinary appeal. In re Prudential Ins. Co. of Am. , 148 S.W.3d 124, 135-36 (Tex. 2004) (orig. proceeding). A trial court clearly abuses its discretion if it reaches a decision so arbitrary and unreasonable as to amount to a clear and prejudicial error of law or if it clearly fails to analyze the law correctly or apply the law correctly to the facts. In re Cerberus Capital Mgmt. L.P. , 164 S.W.3d 379, 382 (Tex. 2005) (orig. proceeding) (per curiam). "The relator must establish that the trial court could reasonably have reached only one decision." Walker v. Packer , 827 S.W.2d 833, 840 (Tex. 1992) (orig. proceeding). "Even if the reviewing court would have decided the issue differently, it cannot disturb the trial court's decision unless it is shown to be arbitrary and unreasonable." Id.

Ordinarily, a relator need only establish a trial court's abuse of discretion to demonstrate entitlement to mandamus relief with regard to a trial court's denial of a timely filed section 33.004(a) motion to designate a responsible third party because in this situation, the relator does not have an adequate remedy by appeal. See In re Coppola , 535 S.W.3d 506, 510 (Tex. 2017) (orig. proceeding) (per curiam).

Applicable Standards for Designating Responsible Third Parties

Civil Practice and Remedies Code section 33.004(a) provides, "[a] defendant may seek to designate a person as a responsible third party by filing a motion for leave to designate that person as a responsible third party." Tex. Civ. Prac. & Rem. Code § 33.004(a). Opposing parties have the right to object to the motion for leave, and when a timely objection is filed, "the court shall grant leave to designate the person as a responsible third party unless the objecting party establishes: (1) the defendant did not plead sufficient facts concerning the alleged responsibility of the person to satisfy the pleading requirement of the Texas Rules of Civil Procedure; and (2) after having been granted leave to replead, the defendant failed to plead sufficient facts concerning the alleged responsibility of the person to satisfy the pleading requirements of the Texas Rules of Civil Procedure." Id. § 33.004(g).

The applicable procedural rule is rule 47, which is our "notice" pleading rule. In re CVR Energy, Inc. , 500 S.W.3d 67, 80 (Tex. App.—Houston [1st Dist.] 2016, orig. proceeding). "Under the notice-pleading standard, fair notice is achieved ‘if the opposing party can ascertain from the pleading the nature and basic issues of the controversy, and what type of evidence might be relevant.’ " Id. (quoting In re Greyhound Lines , No. 05-13-01646-CV, 2014 WL 1022329, at *2 (Tex. App.—Dallas Feb. 21, 2014, orig. proceeding) (mem. op.) ); see also Low v. Henry , 221 S.W.3d 609, 612 (Tex. 2007). A petition is sufficient if a cause of action or defense may be reasonably inferred from what is specifically stated in the pleading, even if an element of the cause of action is not specifically alleged. Dodd v. Savino , 426 S.W.3d 275, 292 (Tex. App.—Houston [14th Dist.] 2014, no pet.) ; In re Greyhound Lines, Inc. , 2014 WL 1022329, at *2. In determining whether to grant a motion for leave to designate a responsible third party, the trial court is restricted to evaluating the sufficiency of the facts pleaded by the movant and is not permitted to review the truth of the allegations or consider the strength of the evidence. See In re CVR Energy, Inc. , 500 S.W.3d at 80 (citing In re Unitec Elevator Servs. Co. , 178 S.W.3d 53, 61 (Tex. App.—Houston [1st Dist.] 2005, no pet.) ); In re Greyhound Lines, Inc. , 2014 WL 1022329, at *2 ; In re Arthur Andersen , 121 S.W.3d 471, 478 n.20 (Tex. App.—Houston [14th Dist.] 2003, orig. proceeding).

Though a responsible third party may be designated by...