MEMC Pasadena, Inc. v. Riddle Power, LLC

472 S.W.3d 379, 2015 Tex. App. LEXIS 8143, 2015 WL 4628143
CourtCourt of Appeals of Texas
DecidedAugust 4, 2015
DocketNO. 14-13-00117-CV
StatusPublished
Cited by21 cases

This text of 472 S.W.3d 379 (MEMC Pasadena, Inc. v. Riddle Power, LLC) 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
MEMC Pasadena, Inc. v. Riddle Power, LLC, 472 S.W.3d 379, 2015 Tex. App. LEXIS 8143, 2015 WL 4628143 (Tex. Ct. App. 2015).

Opinion

OPINION

Ken Wise, Justice

Appellant MEMC Pasadena, Inc., sustained damages after an electrical accident [384]*384at its industrial plant caused ⅛ shutdown and loss of production. MEMC sued its electrical contractor,, Triad Electric and Controls, Inc., and Triad’s subcontractor, Riddle Power, LLC, alleging that Triad breached its contract with MEMC and that both Triad and Riddle were negligent. Following a jury trial, the trial court signed a judgment awarding MEMC.dam-ages against Riddle and a take-nothing judgment -for Triad. On appeal, MEMC raises twenty-two issues, challenging the legal and factual sufficiency of the evidence and the jury charge. For the reasons explained below, we affirm.

Factual and Procedural Background

MEMC owns and operates an industrial plant in Pasadena, Texas, where it manufactures granular polysilicon.1 Granular polysilicon can be made into silicon wafers for use in the semiconductor and solar industries. Much of the polysilicon MEMC produced was transferred to separate corporations related to MEMC’s parent company to be made into silicon wafers, and some was transferred to MEMC Singapore or elsewhere for sale. MEMC would sell any remaining polysilicon on the spot market for a profit.

To increase plant capacity for poly silicon production, MEMC undertook an expansion project known as the P-23 project. MEMC hired CDI Business Solutions, Inc., to oversee and perform the engineering, procurement, and construction management services for the project. CDI also served as MEMC’s “agent for construction on-site.” MEMC delegated the' day-to-day project work to CDI and gave CDI authority to manage the project and contractors. MEMC also authorized CDI to act as its agent during the bid process and to compile bid packages, send the bid packages to prospective contractors, analyze the bids, and prepare recommendations.

On November 22, 2006, CDI extended a Request for Proposal (“RFP”) to prospective electrical and instrumentation contractors, including Triad. The RFP was for a time and materials (“T & M”) project, and it included numerous documents, including a form contract, a description of the scope of work, and commercial terms. Also included were standard terms and conditions prepared by CDI with MEMC’s approval (the “CDI T & Cs”). It also provided instructions the bidders were to follow if they disagreed with any of the terms and conditions. The RFP required the bidder to “except” (i.e., object) to those terms and provide alternate language for review on Proposal Form 11. MEMC notified the bidders that exceptions would be “highly discouraged” and would be taken into consideration when evaluating a bidder’s overall proposal. Fully completed bids were to be mailed by overnight express to be received by CDI on or before 11:00 a.m. on December 18, 2006.

After issuing the RFP, CDI provided supplemental information and terms to the bidders by addendum. An addendum became part of the RFP package, and if a bidder did not object to the addendum, it became part of the bidder’s response to the RFP. Each addendum issued was numbered sequentially, and the addenda were transmitted by email to all of the bidders at the same time. Most of the addenda are not germane to the case.

On November 29, 2006, CDI forwarded “Addendum 3” containing several blank, standardized documents, including a form [385]*385MEMC purchase agreement for goods and services instead of a;T & M contract. The MEMC purchase agreement also contained standard terms and conditions that differed from the CDI T & Cs in the'RFP (the “Addendum 3 T & Cs”). The Addendum 3 T & Cs included a provision making the contractor responsible for any consequential damages.

On December 8, 2006, Triad submitted an exception, to the indemnity, insurance, and lien provisions of the CDI T & Cs. Triad did not except to anything in Addendum 3.

Shortly before the bid deadline, CDI emailed “Addendum 9” to Triad and the other bidders. Addendum 9 provided for a mutual waiver of consequential damages:

Neither party shall be liable to the other for consequential, indirect, incidental, or special damages including but not limited to loss of plant capacity, loss of business or any other such lost, howsoever caused, including by the negligence or strict liability of either party.

Mike Woody at Triad received Addendum 9 before the bid deadline and brought it to the attention of Philip Morgan, Triad’s general manager, who was preparing Triad’s bid. After reviewing Addendum 9, Triad submitted its bid in response to the RFP without excepting to Addendum 9 on Proposal Form 11 or otherwise informing MEMC that it objected. to the mutual waiver of consequential damages. Triad emailed its bid by the deadline, and supplemented its bid with additional information the next day.

CDI analyzed the bids and recommended Triad for the project. MEMC’s project procurement leader, Jerry Jones, awarded the contract to Triad in January 2007. MEMC subsequently issued a purchase order for the project. The purchase order erroneously identified “Performance Contractors” as the contractor. The purchase order also contained form language that “MEMC’s Purchase Order Terms and Conditions are part of this agreement” and available online at MEMC’s website (the “online T & Cs”).

Because some confusion arose over the applicable terms and conditions, Triad contacted Jones. On January 24, 2007, Jones sent correspondence to Triad’s project manager, Ryan Trueblood, informing Triad that “[f]or the. purpose of the contract, CDI T & C’s will govern.” Neither Jones nor Trueblood testified at trial. Triad understood that the “CDI T & C’s” included the terms Triad received in the original RFP and subsequent addenda.

On January 31, 2007, MEMC sent Triad a revised purchase order correcting the name of 'the contracting party (the “PO”). Although the PO contained the same form language making MEMC’s online T & Cs part of the agreement, MEMC inserted this typewritten statement: “PO CHANGE NOTICE 1/31/07 • TERMS & CONDITIONS AMENDED AS. REQUESTED — JJONES.” The PO also specified that the basis of.the T & M purchase order was Triad’s response to the RFP and “subsequent correspondence from Triad on accepted clarifications.” Additionally, the PO instructed that the scope of work at the site was “under the direction of’ CDI, that CDI “will communicate all engineering, construction and specification documents for this work,” and that CDI “will administer this work by authority of’ MEMC. This PO and the incorporated correspondence formed the contract between MEMC and Triad.

By August 2007, the project was behind schedule. To avoid having to shut down plant production, MEMC made the decision to have the electrical work performed without de-energizing a 2,400-volt transformer known as T-45. Electrical work [386]*386done near or with energized electrical equipment is known as “close proximity” or “hot” work. Triad declined CDI’s request to do the work inside of T-45 because it did not perform hot work, so CDI asked Triad to hire Riddle, a high-voltage specialist, as a subcontractor to handle the job.

Riddle quoted a price of $6,500 for the job. Riddle’s superintendent, Charlie Holden, went out to the site before the work was to begin.

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Cite This Page — Counsel Stack

Bluebook (online)
472 S.W.3d 379, 2015 Tex. App. LEXIS 8143, 2015 WL 4628143, Counsel Stack Legal Research, https://law.counselstack.com/opinion/memc-pasadena-inc-v-riddle-power-llc-texapp-2015.