Velsicol Chemical Corp. v. Winograd

• Decision Date: 11 December 1997
• Docket Number: No. 96-0861,96-0861
• Citation: 956 S.W.2d 529
• Parties: VELSICOL CHEMICAL CORPORATION and Columbia Management Services, Inc. d/b/a CMS Exterminating Service, Petitioners, v. Judith WINOGRAD, et al., Respondents.
• Court: Texas Supreme Court

Page 529

956 S.W.2d 529

VELSICOL CHEMICAL CORPORATION and Columbia Management

Services, Inc. d/b/a CMS Exterminating Service, Petitioners, v. Judith WINOGRAD, et al., Respondents.

No. 96-0861.

Supreme Court of Texas.

Dec. 11, 1997.

Rehearing Overruled Dec. 12, 1997.

James L. Ray, Houston, Earl B. Austin, Margaret Niver McGann, Dallas, for Petitioners.

Charles W. Kelly, J. Douglas Sutter, Megan Gabel, Houston, for Respondents.

OPINION

PER CURIAM.

This is an action for damages arising from the spraying of a pesticide, chlordane, at several Houston area apartment complexes. Petitioners are Velsicol Chemical Corporation, a pesticide manufacturer, and Columbia Management Services, Inc., d/b/a CMS Exterminating Service (collectively, Velsicol). Respondent Judwin Properties, Inc. (Judwin) manages apartments in the Houston area. Both Judwin and Velsicol were sued by tenants when the toxic chemical chlordane was used at some of the apartments managed by Judwin to treat for termites and other pests. This suit involves independent claims brought by Judwin against Velsicol for injury to Judwin's property and business.

The issue in this appeal is whether the discovery rule tolled the statute of limitations when Judwin knew that chlordane residues were present inside individual apartments in 1987, but did not discover residue concentrations in excess of regulatory guidelines until 1991. The trial court rendered summary judgment for Velsicol holding that either limitations or collateral estoppel barred the suit. The court of appeals reversed and remanded the suit. 928 S.W.2d 127. We reverse the judgment of the court of appeals and render judgment for Velsicol.

Judwin manages Kings Park Apartments, Edgebrook Apartments, Camino South Apartments, and Fondren Glen Apartments ("the Apartments"). In April 1987, maintenance men employed by Judwin sprayed the exterior of the Apartments with chlordane. After much media attention about the spraying and tenants' concerns over the use of chlordane, the Texas Department of Agriculture ("TDA") began investigating the incident on April 23, 1987. TDA found chlordane present on the exterior of the Apartments and ordered its remediation. However, because the chlordane levels discovered inside individual apartments did not amount to contamination, ¹ TDA did not order remediation of the interior.

On June 20, 1987, several tenants filed the first in a series of lawsuits against Judwin, seeking to recover damages as a result of the exterior spraying. The tenants thereafter added Velsicol as a co-defendant in all the cases. Judwin cross-claimed against Velsicol for contribution and indemnity.

Early in May of 1991, the City of Houston Health Department, prompted by renewed media attention, requested that Judwin sample the interiors of the Apartments for chlordane contamination. Samples collected and analyzed by an environmental consulting firm revealed for the first time that the interior level of chlordane exceeded the "contamination" guidelines. Consequently, the City of Houston required Judwin to remediate some of the apartments' interiors.

Judwin later amended its cross-claims and third-party petitions in several of the pending tenant suits asserting independent causes of action against Velsicol for damages to property and injury to a business. The trial court severed these independent causes of action from the tenant suits and consolidated them into this case. Velsicol then moved for summary judgment, arguing that limitations and collateral estoppel barred the suit. The trial court eventually granted Velsicol's motion for summary judgment. The court of appeals reversed, holding that Velsicol's failure to negate the discovery rule as an exception to its limitations defense precluded summary judgment. Velsicol applied to this Court for writ of error.

A defendant moving for summary judgment on the affirmative defense of limitations has the burden to conclusively establish that defense. When the plaintiff pleads the discovery rule as an exception to limitations, the defendant must negate that exception as well. Woods v. William M. Mercer, Inc., 769 S.W.2d 515, 518 n. 2 (Tex.1988).

Actions for damage to real property must be brought within two years of the injury. TEX. CIV. PRAC. & REM.CODE § 16.003. However, Judwin contends that the discovery rule exception defeats the limitations bar in the present action. The discovery rule represents an attempt to balance society's interest to have disputes either settled or barred within a reasonable time in situations in which it is difficult for the injured party to learn of the negligent act. See Willis v. Maverick, 760 S.W.2d 642, 645 (Tex.1988); Safeway Stores, Inc. v. Certainteed Corp., 710 S.W.2d 544, 545 (Tex.1986). The discovery rule applies if: (1) the injury is inherently undiscoverable; and (2) the evidence of the injury is objectively verifiable. Computer Assocs. Int'l, Inc. v. Altai, Inc., 918 S.W.2d 453, 456 (Tex.1996).

Velsicol introduced uncontroverted evidence that in 1987 Judwin knew that chlordane residues in the interior of the apartments were...