Firm Newsletter - June 2015

Photo by bermau/iStock / Getty Images

Photo by bermau/iStock / Getty Images

Chapter 95 Protections to Property Owners Affirmed by Supreme Court

On May 8, 2015, the Texas Supreme Court handed down a decision in Abutahoun v. Dow Chemical Company, which examined Chapter 95 of the Texas Civil Practice and Remedies Code. See 2015 WL 2147979, 58 Tex. Sup. Ct. J. 879. Section 95.003 of the Texas Civil Practice and Remedies Code provides that a property owner is not liable for personal injury, death, or property damage to a contractor, subcontractor, or an employee of a contractor or subcontractor who constructs, repairs, renovates, or modifies an improvement to real property, including personal injury, death, or property damage arising from the failure to provide a safe workplace unless: (1) the property owner exercises or retains some control over the manner in which the work is performed, other than the right to order the work to start or stop or to inspect progress or receive reports; and (2) the property owner had actual knowledge of the danger or condition resulting in the personal injury, death, or property damage and failed to adequately warn.

In Abutahoun, the Dow Chemical Company contracted with Win-Way Industries to install insulation on a system of pipelines at Dow’s facility in Freeport, Texas. Robert Henderson was an employee for Win-Way and he worked on the insulation project at Dow’s Freeport facility from 1967 to 1968. Mr. Henderson helped insulate the pipes with a material containing asbestos. He was exposed to asbestos dust as a result of his own direct contact with the insulation products and also allegedly as a result of the work by Dow employees who were installing, sawing, and removing asbestos insulation nearby. Mr. Henderson was eventually diagnosed with mesothelioma and he and his wife sued Dow along with over a dozen other defendants under various negligence and product liability theories. During the lawsuit, Mr. Henderson died and his two daughters joined to the lawsuit as wrongful death heirs.

Dow moved for summary judgment and it was granted in part so that only the Hendersons’ claims predicated on the negligence of Dow’s employees were allowed to proceed before the jury. The Hendersons’ claims against all of the other defendants were resolved before the case was submitted to the jury. At the conclusion of the trial, the jury found that Dow’s negligence proximately caused Robert Henderson’s injuries, that Dow was 30% responsible, and based on the jury’s verdict the trial court rendered judgment against Dow for $2.64 million plus interest and court costs.

On appeal Dow argued that Chapter 95 does not distinguish between a property owner’s liability for exposure caused by the activities of contractors and their employees and exposure that the property owner’s own employees’ activities caused. Dow thought Chapter 95 applied which would bar all of the Hendersons’ negligence claims because the Hendersons did not establish that Dow had both control over Mr. Henderson’s work and actual knowledge of the dangers of asbestos exposure as Chapter 95 requires. The Hendersons believed Chapter 95 did not apply because their claims against Dow were based upon the negligent activities of Dow employees and not from an injury arising from the condition or use of an improvement of real property by Mr. Henderson. The court of appeals agreed with Dow by reversing the decision of the trial court and rendering a take-nothing judgment in favor of Dow.

The Supreme Court applied the plain meaning of the statute and concluded that Chapter 95 applies to an independent contractor’s claims for damages caused by the contemporaneous negligent acts of a property owner and affirmed the judgment of the court of appeals. One reason was that, although the statute lists whom a claim governed by Chapter 95 can be asserted against, it says nothing about the actor who causes the negligence claim to arise and makes no distinction between the harm caused by a contractor’s actions and harm caused by an-other’s actions. This result will have the effect of limiting future claims by plaintiffs against premises owners and confirms the broad protection provided by the statute to property owners. 

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