Oncor Electric Delivery Company LLC v. Southern Foods Group D/B/A Schepps Dairy

444 S.W.3d 699, 2014 Tex. App. LEXIS 9407, 2014 WL 4435932
CourtCourt of Appeals of Texas
DecidedAugust 25, 2014
Docket05-12-01223-CV
StatusPublished
Cited by8 cases

This text of 444 S.W.3d 699 (Oncor Electric Delivery Company LLC v. Southern Foods Group D/B/A Schepps Dairy) 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
Oncor Electric Delivery Company LLC v. Southern Foods Group D/B/A Schepps Dairy, 444 S.W.3d 699, 2014 Tex. App. LEXIS 9407, 2014 WL 4435932 (Tex. Ct. App. 2014).

Opinion

*701 OPINION

Opinion by Justice BROWN.

A jury found that the negligence of appellant Oneor Electric Delivery Company, LLC (Oneor) caused a fire at a milk processing plant owned by appellee Southern Foods Group, LLC d/b/a Schepps Dairy (Schepps Dairy). Based on the jury’s verdict, the trial court rendered judgment for Schepps Dairy in the amount of $857,095.72. In three issues, Oneor contends that the evidence was legally and factually insufficient to support the jury’s verdict and the trial court’s judgment. Because we conclude that the evidence was insufficient to establish that Oncor’s negligence was the cause in fact of the fire, we reverse the trial court’s judgment and render judgment for Oneor.

Background

On June 25, 2008, there was a fire at a transformer bank at Schepps Dairy’s milk processing plant in Dallas. Oneor owned, operated, and maintained electric lines and other equipment at the Schepps Dairy plant, including the rack-mounted transformer bank. This equipment was used to deliver electric power from Oneor to Schepps Dairy at a “point of delivery,” defined for the jury as “the point in at which electric power and energy leaves the electric lines, and other equipment, including transformers, owned by” Oneor. Although no one was injured, the fire caused property damage to both Schepps Dairy and Oneor.

After both parties conducted investigations, Schepps Dairy brought suit against Oneor for negligence, alleging that that the fire was caused by “a faulty and/or loose Oneor terminal connection to a pole mounted transformer” that overheated. Later, Schepps Dairy amended its pleading to allege more generally that the fire “originated at the center transformer” on the bank; Oneor had been notified that its equipment at the bank was “faulty, loose, and/or in need of maintenance and repair”; but Oneor “failed to take reasonable and adequate corrective measures.” Schepps Dairy alleged that the fire was proximately caused by Oncor’s negligence, including Oncor’s “fail[ure] to own, operate and maintain its electric lines and other equipment, including the rack-mounted transformer bank in question, in accordance with good utility practice.”

At trial, Schepps Dairy sought to prove that the fire started in the center transformer in a group of three transformers on the rack. Witnesses testified that on the night of the fire, they saw flames coming out of the transformers above the point of delivery on the bank. One eyewitness testified that he saw “electricity” go inside the transformer; the transformer “blew out”; and burning oil that “looked like lava” came out of the top of the transformer. The evidence also showed that in 2008 and 2005, Oneor had replaced the center transformer because it was leaking oil.

In 2005, after the second replacement, Oneor conducted a study to determine the cause of the leaks. Terry Mayo, an electrical engineer and Oneor employee, conducted the study and testified at trial. His report was introduced into evidence, and stated that “[a] thermal infrared inspection of the bank revealed that the center transformer is running significantly hotter than the other transformers in the bank.” Mayo concluded that the transformer bank was overheating “due to harmonic currents.” His report suggested three options for “solving the transformer heating problem,” including two that would have to be undertaken by Schepps Dairy rather than Oneor. Neither Mayo’s report nor these options, however, were ever communicated to Schepps Dairy. Schepps Dairy *702 conducted its own inspections in 2005, 2007, and 2008, and observed “hot spots” on the center transformer. Schepps Dairy-offered evidence at trial that these observations had been reported to Oncor by using Oncor’s automated telephone system.

Three expert witnesses testified at trial. All were electrical engineers. Oncor’s expert witness, Hunter Sims, testified that electrical arcing occurred in the conduit on Schepps Dairy’s side of the point of delivery due to a failure in the insulation surrounding Schepps Dairy’s wiring. Maintenance of this equipment was the responsibility of Schepps Dairy.

Schepps Dairy’s first expert witness, La-cie Smith, had expertise in determining the origin and cause of fires and explosions. Smith opined that the fire started at a loose connection on the left lug of the center transformer. This loose or “hot” connection was the cause of the fire. Smith explained:

The hot connection eventually ignited, I believe, the combination of leaking transformer oil, from around — leaked out from around the bushing and mixed with wiring insulation, so it was [a] combination of the two where the first flame occurred.

The “classic hot connection” was “a maintenance problem on the part of Oncor,” probably occurring when the transformer was installed, but becoming worse over time. On cross-examination, Smith also clarified that he was not offering any opinion about two of the possible causes of overheating in the transformer identified in Mayo’s report, the “effect of harmonics as the cause and origin of the fire,” or Schepps Dairy’s “power factor.”

A third expert, Lynn Montgomery, testified on behalf of Schepps Dairy. Because two of Oncor’s three issues on appeal relate to Montgomery’s opinions, we discuss the substance of his testimony in detail below. In its operative responses to On-cor’s requests for disclosure, Schepps Dairy explained the substance of Montgomery’s opinions: (1) the fire originated at the center transformer; (2) the fire was not caused by harmonic currents on Schepps Dairy’s side of the point of delivery; (8) Schepps Dairy’s demand for power was within the capability of the transformer bank; (4) the fire was not caused by any of Schepps Dairy’s equipment on its side of the point of delivery; (5) Oncor is responsible to construct, own, operate, and maintain its electric lines and other equipment, including transformers, on its side of the point of delivery in accordance with good utility practice, and (6) “[t]he fire was caused by Oncor’s failure to own, operate and maintain its electric lines and other equipment, including the transformer bank in question, in accordance with good utility practice.”

The jury did not accept either Sims’s or Smith’s testimony. The jury was asked a specific question premised on Smith’s opinion, whether “the negligence, if any, of [Oncor] in the installation of the conductor and lug on the center transformer proximately cause[d]” Schepps Dairy’s damages. The jury answered this question “no,” and also answered “no” to the question whether Schepps Dairy’s negligence was a proximate cause of its damages, thus rejecting Sims’s theory of faulty insulation on wires on Schepps Dairy’s side of the point of delivery.

The jury did find, however, that Oncor’s negligence proximately caused “the occurrence in question.” This inquiry was made in Question 1 of the jury charge. The instructions accompanying Question 1 included definitions of “negligence,” “ordinary care,” “proximate cause,” “point of delivery,” and “good utility practice.” The definitions of ordinary care were specific *703 to each party.

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444 S.W.3d 699, 2014 Tex. App. LEXIS 9407, 2014 WL 4435932, Counsel Stack Legal Research, https://law.counselstack.com/opinion/oncor-electric-delivery-company-llc-v-southern-foods-group-dba-schepps-texapp-2014.