Morgan v. Compugraphic Corp.

• Citation: 675 S.W.2d 729
• Decision Date: 11 July 1984
• Docket Number: No. C-2411,C-2411
• Parties: Margie F. MORGAN, Petitioner, v. COMPUGRAPHIC CORPORATION, Respondent.
• Court: Supreme Court of Texas

Page 729

675 S.W.2d 729

Margie F. MORGAN, Petitioner, v. COMPUGRAPHIC CORPORATION, Respondent.

No. C-2411.

Supreme Court of Texas.

July 11, 1984.

Rehearing Denied Oct. 10, 1984.

Cox & Bader, Betran T. Bader, III, Dallas, for petitioner.

Hughes & Hill, William B. Finkelstein and Paul Koning, Dallas, for respondent.

RAY, Justice.

Margie F. Morgan brought this suit against Compugraphic Corporation and Solutek Corporation under theories of negligence and strict liability, alleging that the two corporations were jointly and severally liable for injuries she had incurred as a result of inhaling chemical fumes emitted from a typesetting machine installed in her office. Solutek timely answered, but Compugraphic filed no answer. After hearing evidence as to damages pursuant to Texas Rule of Civil Procedure 243, the trial court rendered default judgment against Compugraphic in the amount of $200,000 and then severed Morgan's cause of action against Compugraphic from her suit against Solutek. Compugraphic appealed by writ of error to the Dallas Court of Appeals. The court of appeals reversed and remanded the cause for a trial on the merits, ¹ holding that: (1) Morgan had the burden of proving that her injuries were proximately caused by the acts of Compugraphic; (2) Morgan had presented no competent evidence of proximate cause; and (3) the trial court's severance of Morgan's suit against Compugraphic from her suit against Solutek was improper. 656 S.W.2d 530.

Morgan contests the correctness of each of these holdings before this court. Upon consideration of the court of appeals holding that it was incumbent upon Morgan to prove proximate cause, we reach the somewhat different conclusion that Morgan was required to prove a causal nexus between her injuries and her exposure to chemical fumes. We find some competent evidence in the record which establishes such a causal nexus. We further find that the court of appeals erred in holding that the trial court's severance of Morgan's causes of action was improper. We reverse the judgment of the court of appeals and remand the cause to that court for a determination of whether there was factually sufficient evidence to support an award of $200,000.

The only evidence as to the facts of this case consists of Morgan's testimony before the trial court at the assessment of damages hearing, at which Compugraphic did not appear. Morgan is a secretary employed by Frito-Lay, Inc. Morgan testified that she had always been in good health prior to returning to work from a vacation in November of 1979. Upon her return to work, Morgan found that a typesetting machine had been installed near her desk. The machine was manufactured and installed by Compugraphic and used chemicals manufactured by Solutek. Morgan testified that the machine was positioned in such a way that the back of it was only two inches from her face as she worked. Soon after Morgan came back to work, she began to develop problems with her breathing. After working four or five days near the machine, she began to experience blurred vision, headaches, stomach problems, and swelling of the eyes, lips, and nasal passages. About a month after she began to suffer these symptoms, Morgan learned that two chemical leaks in the typesetter had been discovered and repaired. Morgan's health continued to decline after the repair. She testified that she began to develop frequent skin rashes as well as a number of problems with her circulatory, digestive and nervous systems. She further testified that she has to administer histamine shots to herself twice each day.

We first reach the question of whether a party who secures a default judgment against a non-answering defendant must, at a Rule 243 hearing, present evidence proving the cause of the damages. Rule 243 reads as follows:

If the cause of action is unliquidated or be not proved by an instrument in writing, the court shall hear evidence as to damages and shall render judgment therefor, unless the defendant shall demand and be entitled to a trial by jury in which case the judgment by default shall be noted, a writ of inquiry awarded, and the cause entered on the jury docket.

At issue in this case is the meaning of the phrase "the court shall hear evidence as to damages." Morgan contends that "evidence as to damages" refers only to evidence establishing the fact of damages and does not include evidence pertaining to the cause of those damages. Morgan cites as support two long-standing rules of Texas jurisprudence. One rule is that a judgment taken by default on an unliquidated claim admits all allegations of fact set out in the petition, except the amount of damages. See Stoner v. Thompson, 578 S.W.2d 679, 684 (Tex. 1979); Long v. Wortham, 4 Tex. 381 (1849). The other rule, a corollary of the first, holds that if the facts set out in the petition allege a cause of action, a default judgment conclusively establishes the defendant's liability. Tarrant County v. Lively, 25 Tex.--Supp. 399 (1860); Clark v. Compton, 15 Tex. 32 (1855); Wall v. Wall, 630 S.W.2d 493, 496 (Tex. Civ. App.--Fort Worth 1982, writ ref'd n.r.e.).

Morgan's argument is flawed because it combines two distinct aspects of causation which exist in a personal injury case such as this. In a personal injury case, the plaintiff typically alleges that the defendant's conduct caused an event--an automobile accident, a fall, or in this case, the release of chemical fumes--and that this event caused the plaintiff to suffer injuries for which compensation in damages should be paid. Thus, at trial the plaintiff must establish two causal hexuses in order to be entitled to recovery: (a) a causal nexus between the defendant's conduct and the event sued upon; and (b) a causal nexus between the event sued upon and the plaintiff's injuries. ²

The causal nexus between the defendant's conduct and the event sued upon relates to the liability portion of plaintiff's cause of action. Here, we use the term "liability" to mean legal responsibility for the event upon which suit is based. In a negligence action, liability is usually established by proving that the defendant's negligence was a proximate cause of the event sued upon; in a products liability action in which a manufacturing defect is alleged, liability is established by proving that a product was placed in the stream of commerce containing a defect which was a producing cause of the event made the basis of suit. It is this causal nexus between the conduct of the defendant and the event sued upon that is admitted by default. From the rule that a default judgment conclusively establishes the defendant's liability, it follows that a default judgment admits that the defendant's conduct caused the event upon which the plaintiff's suit is based.

Whether the event sued upon caused any injuries to the plaintiff is another matter entirely. The causal nexus between the event sued upon and the plaintiff's injuries is strictly referable to the damages portion of the plaintiff's cause of action. Even if the defendant's liability has been established, proof of this causal nexus is necessary to ascertain the amount of damages to which the plaintiff is entitled. This is true because the plaintiff is entitled to recover damages only for those injuries caused by the event made the basis of suit; that the defendant has defaulted does not give the plaintiff the right to recover for damages which did not arise from his cause of action. See Mitchell v. Town of Ahoskie, 190 N.C. 235, 129 S.E. 626 (1925). To hold, as we do, that a defaulting defendant does not admit that the event sued upon caused any of plaintiff's alleged injuries is entirely consistent with the rule that a judgment taken by default admits all allegations of fact set out in the petition, except for the amount of damages. Proving that the event sued upon caused the plaintiff's alleged injuries is part and parcel of proving the amount of damages to which the plaintiff is entitled. The causal nexus between the event sued upon and the plaintiff's injuries must be shown by competent evidence. See Gerland's Food Fair, Inc. v. Hare, 611 S.W.2d 113 (Tex. Civ. App.--Houston [1st Dist.] 1980, writ ref'd n.r.e.). Accord Smith v. Sayles, 637 S.W.2d 714 (Mo. App. 1982). We conclude that the mandate of Rule 243 that the court hear "evidence as to damages" makes it incumbent upon a party who obtains a default judgment in a personal injury action to present competent evidence of a causal nexus between the event sued upon and the party's alleged injuries.

It remains to apply the rules set forth in the foregoing discussion to the case before us. Morgan alleged in her petition that Compugraphic negligently installed a typesetting machine, or, alternatively, installed a defective typesetting machine, and that as a result of this conduct chemical fumes were released into Morgan's office, causing her a variety of injuries. The event sued upon is thus the release of chemical fumes into Morgan's office. By its default, Compugraphic admitted that its negligence was a proximate cause of the release of chemical fumes into Morgan's office. Compugraphic further admitted by its default that a defect in the typesetting machine was a producing cause of that event. However, Compugraphic's default did not establish that the release of chemical fumes caused Morgan any injuries. At the Rule 243 hearing, Morgan had the burden of presenting competent evidence of a causal nexus between the release of chemical fumes and her alleged injuries.

This brings us to the issue of whether Morgan presented some competent evidence that her alleged injuries were caused by the release of chemical...