Villagomez v. Rockwood Specialties, Inc.

• Decision Date: 30 November 2006
• Docket Number: No. 13-05-389-CV.,13-05-389-CV.
• Parties: Lucy VILLAGOMEZ, Individually, and as Representative of the Estate of Ismael Villagomez, Deceased, and Francisco Villagomez and Maria Villagomez, Appellants, v. ROCKWOOD SPECIALTIES, INC., Appellee.
• Court: Texas Court of Appeals

210 S.W.3d 720

Lucy VILLAGOMEZ, Individually, and as Representative of the Estate of Ismael Villagomez, Deceased, and Francisco Villagomez and Maria Villagomez, Appellants, v. ROCKWOOD SPECIALTIES, INC., Appellee.

No. 13-05-389-CV.

Court of Appeals of Texas, Corpus Christi-Edinburg.

November 30, 2006.

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Alice Oliver-Parrott, Burrow & Parrott, LLP, Maria Teresa Arguindegui, Law Office of Maria Teresa Arguindegui, David H. Burrow, Houston, Houston Munson, Munson, Burns, Munson & Munson, Gonzales, for appellants.

Gerald L. Bracht, Solace Kirkland Southwick, Andrews & Kurth, Houston, for appellee.

Before Chief Justice VALDEZ and Justices CASTILLO and GARZA.

OPINION

Opinion by Justice GARZA.

Lucy Villagomez, individually and as representative of the estate of Ismael Villagomez, deceased, Francisco Villagomez and Maria Villagomez (collectively "the Villagomez family") appeal from the trial court's order granting a special appearance by Rockwood Specialties, Inc., a foreign corporation whose direct acts and omissions are alleged to have proximately caused the wrongful death of Mrs. Villagomez's husband, Ismael Villagomez, who was working in Gonzales, Texas at the time of his death. Because we hold that Rockwood failed to negate the existence of personal jurisdiction, we reverse the trial court's order and remand the case for further proceedings consistent with this opinion.

I. Background

Ismael Villagomez suffered catastrophic burns from direct exposure to massive amounts of steam while cleaning an empty batching tank. At the time of the accident, Mr. Villagomez was on-the-job and acting under the direction of his employer, Southern Clay, Inc., a Texas corporation with its principle place of business in Gonzales, Texas. Although Mr. Villagomez's injuries were fatal, he did not die immediately. He was alive when paramedics arrived on the scene. He was later transported to a local hospital, where he was declared dead.

Mr. Villagomez's family subsequently filed suit against Southern Clay, alleging negligence and gross negligence. The Villagomez family also sued Southern Clay's parent company, Rockwood Specialties, Inc., a Delaware corporation headquartered in Princeton, New Jersey. The claims against Rockwood include negligence, gross negligence, and negligent undertaking.

Rockwood made a special appearance before the trial court, arguing that the court lacked personal jurisdiction to hear any claims against Rockwood because it is an out-of-state corporation lacking minimum contacts with Texas. The trial court granted the special appearance and the Villagomez family has appealed to this Court.

II. Standard of Review

Whether a court has personal jurisdiction over a defendant is a question of law. Am. Type Culture Collection v. Coleman, 83 S.W.3d 801, 805-06 (Tex.2002). In resolving this question of law, a trial court must frequently resolve questions of fact. See id. at 806. On appeal, the trial court's determination to grant or deny a special appearance is subject to de novo review, but appellate courts may also be called upon to review the trial court's resolution of a factual dispute. See id. The standard of review applicable on appeal from the resolution of such factual disputes in a special appearance proceeding was recently clarified by the Texas Supreme Court in BMC Software: "If a trial court enters an order denying a special appearance, and the trial court issues findings of fact and conclusions of law, the appellant may challenge the fact findings on legal and factual sufficiency grounds." BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 794 (Tex.2002).

In the case at bar, the trial court granted Rockwood's special appearance and later adopted, word-for-word, virtually all of the 67 proposed findings of fact and 14 proposed conclusions of law drafted and submitted by Rockwood. The trial court denied extensive written objections filed by the Villagomez family, including among other numerous, detailed objections, challenges to the legal and factual sufficiency of the evidence to support the findings proposed by Rockwood. The court later denied all of the supplemental findings of fact and conclusions of law submitted and requested by the Villagomez family.

Following the precedent set by the Texas Supreme Court in BMC Software, the Villagomez family has appealed virtually all of the trial court's findings of fact on legal and factual sufficiency grounds. In addition, they have raised challenges to the trial court's conclusions of law and other substantive issues.

Although a trial court's findings of fact may be challenged for legal and factual sufficiency, we find problematic the mechanical application of the BMC Software precedent to the facts of this case. The trial court heard no live testimony; yet, the case is riddled with factual disputes. Furthermore, many of the trial court's findings of fact cannot be reconciled with the admitted and uncontested evidence in the record.

The reporter's record shows that the trial court decided the special appearance by reviewing a cold record of deposition testimony, affidavits, and other evidence. The hearing on Rockwood's special appearance was non-evidentiary, and all of the evidence was admitted by stipulation. The parties presented only legal arguments at the hearing.

While this may not have been error, it certainly should affect the amount of deference given to the trial court's findings of fact on appeal. Compare Tex.R. Civ. P. 120a(3) (permitting "oral testimony" to resolve special appearance) and Michiana Easy Livin' Country, Inc. v. Holten, 168 S.W.3d 777, 782 (Tex.2005) (noting that "manner of [evidence] presentation is discretionary" in special appearances) with Union Carbide Corp. v. Moye, 798 S.W.2d 792, 794 (Tex.1990) (Hecht, J. concurring) (contending that trial courts are "authorized and even obliged by rule 258 to hear live testimony when it is necessary to resolve issues that cannot be determined on a written record" and then stating that "proceedings under rule 258 are similar [in that regard] to those under rule 120a").

For instance, the trial court's findings could not have been based on evaluations of credibility or demeanor. See Union Carbide, 798 S.W.2d at 798 (Gonzalez, J. dissenting) ("It is difficult, if not impossible, for the trial judge to evaluate the credibility of the witnesses and the weight to be given their testimony from reading the cold record. The importance of the issues at stake and the difficulty of adjudication by reading the record, require that the parties have the right to a hearing in open court."). Indeed, there is no possibility the trial court could have used any of its unique fact-finding functions to resolve conflicts in the evidence, as the trial court did not occupy its fact-finding position at the hearing on the special appearance. Although a court which holds an evidentiary hearing and acts as the finder of fact is owed special deference because of its unique position to hear live testimony and resolve conflicts in the evidence, a court that issues findings based on a cold record is in virtually the same position as the appellate court that reviews its findings. See Benoit v. Wilson, 150 Tex. 273, 282, 239 S.W.2d 792 (1951) (holding that a "court should never set aside a jury verdict merely because the jury could have drawn different inferences or conclusions" because the jury "has considered all the facts admitted before it and has, by its answers, selected from the conflicting evidence and conflicting inferences that which it considered most reasonable.").

It is thus unclear why the trial court's findings should be given any special deference in circumstances such as these. See Otis Elevator Co. v. Parmelee, 850 S.W.2d 179, 181 (Tex.1993) ("Here, the trial court heard no evidence but expressly based its decision on the papers filed and the argument of counsel. Under these circumstances, there are no factual resolutions to presume in the trial court's favor."). Certainly, there is no intuitive reason for giving the trial court's findings deference equal to those of a jury that sat through the presentation of evidence and testimony and later deliberated to resolve conflicts in the evidence. See, e.g., Texlan, Inc. v. Freestone County, 282 S.W.2d 283, 288-89 (Tex.Civ.App.-Waco 1955, no writ) ("The jury, being the trier of the facts, had the duty and responsibility of passing upon the credibility of the witnesses and determining the ultimate issues before them and, in so doing, they could reject or accept the testimony of each witness in whole or in part as they found the facts to be.").

For the foregoing reasons, we do not proceed to the merits of this appeal without stating that we are troubled by application of the traditional standards of legal and factual sufficiency reviews to the case at bar. Notwithstanding these concerns, we conduct the due-process personal-jurisdiction review by crediting evidence that supports the trial court's findings of fact if reasonable jurors could, and by disregarding contrary evidence unless reasonable jurors could not. See City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex.2005).

Before applying this standard, we draw a clear distinction between the trial court's findings of fact and the trial court's conclusions of law. The trial court's findings of fact may be reviewed individually for legal and factual sufficiency, but the trial court's conclusions of law are not susceptible to such review. BMC Software, 83 S.W.3d at 794. Instead, the trial court's conclusions of law are reviewed de novo for legal correctness based on the facts of the case. Id.

In reviewing the correctness of the trial court's application of the law to the facts of this case, we do not necessarily limit "the facts of the case" to the trial court's findings of fact. Limiting "the...