Hall v. Diamond Shamrock Refining Co., LP

82 S.W.3d 5, 2001 WL 716769
CourtCourt of Appeals of Texas
DecidedMay 10, 2002
Docket04-99-00370-CV
StatusPublished
Cited by19 cases

This text of 82 S.W.3d 5 (Hall v. Diamond Shamrock Refining Co., LP) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hall v. Diamond Shamrock Refining Co., LP, 82 S.W.3d 5, 2001 WL 716769 (Tex. Ct. App. 2002).

Opinions

Opinion by:

ALMA L.. LÓPEZ, Justice.

This appeal arises from a survivor’s cause of action for punitive damages. Appellant, Donna Hall (“Hall”) appeals the trial court’s judgment, which capped her recovery of punitive damages. Appellees, Diamond Shamrock Refining Co., L.P., Diamond Shamrock Refining and Marketing Co., Diamond Shamrock, Inc., Sigmor Corp., and Ultramar Diamond Shamrock Corp., (“Diamond Shamrock”) cross-appeal the jury verdict. Because we find that the trial court abused its discretion, we reverse the judgment of the trial court and remand the cause for a new trial.

Factual and ProceduRal Background

On April 1, 1996, an explosion and fire occurred at Diamond Shamrock’s refinery in Moore County, Texas, at the McKee Plant in the Refinery Light Ends (“RLE”) compressor building. Diamond Shamrock was a self-insured subscriber under the Texas Workers’ Compensations Laws of the State of Texas. Charles Otis Hall (“Charles”) was an employee of Diamond Shamrock working at the refinery when the explosion occurred.

The fire was caused when the first stage compressor cylinder on the No. 2 RLE compressor pulled in liquid during the start-up procedure, which caused the cylinder internal bypass cover plate to crack. Hydrocarbon liquid and gas leaked from the cracked cover plate and was ignited from an unidentified source, which resulted in the fire and explosion. Three employees in the feed prep unit — Ellis Thorn-burg, Charles Hall, and Kevin Smith— were severely injured and sent to the Lubbock Burn Center. As a result of the explosion, Charles received third degree burns over fifty percent of his body, which caused his death eight days later on April 9,1996.

The sequence of events show that on April 1, 1996, at 11:00 a.m., the hydro-cracker unit was in the process of starting up. During the process of starting up, the hydrocracker fractionator overhead accumulator that normally vents vapors started carrying liquid into the RLE compressor first stage suction drum. The first stage suction drum has an accumulator with a pump that operates automatically to pump liquid out of the system. At 3:00 p.m., the RLE compressor first stage suction drum level alarm signaled a high level. The high level alarm was supposed to automatically shut down the engines, but the liquid level in the suction drum went above the sight glass and the operating personnel had to manually shut down the engines. The operating personnel reported that the system failed to shut down the engines on the high suction drum level. By 4:50 p.m., the suction drum level was back to normal, and liquid was not being carried into the system from the hydrocracker fractionator. During the period of time the RLE compressors were down, liquid was being pumped from the first stage suction liquid [11]*11accumulator into the first stage discharge line. During later investigations of the explosion, Diamond Shamrock found that the check valve failed and that the No. 2 RLE compressor’s first stage discharge valve leaked.

At approximately 5:00 p.m., the evening operating crew was in the process of starting up the No. 2 RLE compressor engine. The evening operating crew, consisting of Ellis Thornburg, Charles Hall, and Kevin Smith, followed the written procedures to start these engines. The machine was rolled with air and started without incident. When the operating crew started to load the No. 2 RLE compressor, the discharge valve on the first stage cylinder was opened first. The pressure on the line down stream of the first stage cylinder discharge block valve was estimated to have been thirty to forty pounds. When the discharge valve was opened, the pressure in the line forced liquid out through the valve on the torch line which was still open and also through the valve on the recirculating line into the suction of the first stage compressor cylinder. The machine, which was running at the time, was trying to compress liquid instead of vapors and caused the cap to break and the ensuing fire. A very small amount of liquid was required for this to occur. The accident was caused when the first stage compressor cylinder discharge block valve leaked, and the first stage discharge check valve failed during the time both engines were down for approximately two hours due to high levels of liquid in the suction accumulator.

On August 8, 1997, Donna Hall, the surviving widow of Charles, filed suit in Bexar County pursuant to the Texas Workers’ Compensation Act and Article 16, Section 26 of the Texas Constitution to recover punitive damages from Diamond Shamrock. On November 9, 1998, the jury returned a verdict for Hall in the amount of $42.5 million. Immediately after the jury was polled, Diamond Shamrock, in open court, moved for the trial court to limit the recovery of punitive damages to $200,000 pursuant to chapter 41 of the Civil Practices and Remedies Code. On November 28, 1998, Hall filed a motion for judgment on the jury’s verdict. On December 7, 1998, Diamond Shamrock filed a motion for judgment notwithstanding the verdict (“JNOV”). At a hearing on December 17, 1998, the trial court heard arguments from both parties on the motions presented. The trial court denied Diamond Shamrock’s motion for JNOV, denied Hall’s motion for judgment, and granted Diamond Shamrock’s motion made in open court to limit the recovery of punitive damages. On April 28, 1999, the trial court entered a final judgment which limited Hall’s recovery to $200,000.

On appeal, Hall complains in five issues that the trial court erred in capping the jury verdict at $200,000 and in denying her motion for judgment. Diamond Shamrock complains on cross-appeal: (1) that the evidence was legally and factually insufficient to support the jury’s finding of gross negligence; (2) that the trial court erred in admitting evidence of two prior explosions; (3) that the trial court erred in ruling that Diamond Shamrock operated as a single business enterprise and in admitting Dan Hanke’s testimony regarding Diamond Shamrock’s net worth; (4) that the jury award is excessive; (5) that there is no basis for a judgment against Ultramar; (6) that the trial court erred in awarding post-judgment interest from the date of the verdict and not from the date of the judgment; and (7) that Hall failed to satisfy the requirements of section 41.005(a) of the Civil Practices and Remedies Code. Before we address Hall’s issues on appeal, we will first address Diamond Shamrock’s issue on whether the evidence is legally [12]*12and factually sufficient to support the jury’s finding because the outcome of this issue is dispositive of this case.

Legal and Factual Sufficiency

In its first issue on cross-appeal, Diamond Shamrock complains that the evidence was legally and factually insufficient to support the jury’s finding of gross negligence. Specifically, Diamond Shamrock contends that Hall failed to meet the objective and subjective tests for gross negligence.

A. Applicable Law

Gross negligence includes two elements: (1) viewed objectively from the actor’s standpoint, the act or omission must involve an extreme degree of risk, considering the probability and- the magnitude of the potential harm to others; and (2) the actor must have actual, subjective awareness of the risk involved, but nevertheless proceed in conscious indifference to the rights, safety, or welfare of others. See Tex. Civ. Prac. & Rem.Code Ann. § 41.001(7)(B) (Vernon 1997); Mobil Oil Corp. v. Ellender, 968 S.W.2d 917, 921 (Tex.1998).

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82 S.W.3d 5, 2001 WL 716769, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hall-v-diamond-shamrock-refining-co-lp-texapp-2002.