Permian Corporation v. Trumbull Asphalt Co. of Del.

472 S.W.2d 555, 1971 Tex. App. LEXIS 2105
CourtCourt of Appeals of Texas
DecidedOctober 21, 1971
Docket612
StatusPublished
Cited by8 cases

This text of 472 S.W.2d 555 (Permian Corporation v. Trumbull Asphalt Co. of Del.) 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
Permian Corporation v. Trumbull Asphalt Co. of Del., 472 S.W.2d 555, 1971 Tex. App. LEXIS 2105 (Tex. Ct. App. 1971).

Opinion

OPINION

BISSETT, Justice.

This is a suit for damages to property resulting from the rupture of a storage tank that was filled with hot liquid asphalt. The Permian Corporation, plaintiff and cross-defendant, hereinafter called “Permian”, sued Trumbull Asphalt Company of Delaware, defendant and cross-plaintiff, hereinafter called “Trumbull”, seeking a recovery for the cost of putting its tank farm back into the condition that it was in prior to the rupture of the storage tank and for delinquent rent alleged to be due. Trumbull, by way of set-off, prayed for an allowance for certain inventory losses that occurred during the existence of the lease agreement between it and Permian, and also filed a cross-action against Permian for recovery of the value of the asphalt that was lost when the storage tank collapsed.

Trial was to a jury and judgment was entered on the jury verdict granting Permian the amount of rent found to be due it by Trumbull, less certain offsets found to be due Trumbull, that Permian take nothing against Trumbull on its action for damages, and that Trumbull take nothing on its cross-action for damages. The portion of the judgment concerning the rent and set-off is not appealed, but Permian has duly and timely perfected its appeal from the judgment denying it any recovery on its claim for damages. Trumbull appeals from the judgment denying it any recovery for damages asserted in its cross-action. We affirm.

Permian was the owner and operator of a storage tank farm located in Brownsville, Cameron County, Texas. Trumbull was engaged in the business of processing and selling asphalt. In the latter part of 1964, Permian, by written contract, leased and furnished to Trumbull certain storage tanks, having a cumulative storage of 78,000 barrels. Under the contract, among other services, Permian was required to “receive, unload and store to the capacity of the tanks all asphalt blending material delivered from time to time by or on behalf of Trumbull to the Brownsville terminal in barges and tank trucks”. Either party could terminate the agreement, effective November 1, 1965, or on November 1 of any succeeding year, by giving the other party written notice at least 90 days prior to the termination date. Trumbull was served with such termination notice on July 29, 1965, to be effective on November 1, 1965. However, Trumbull continued to use the storage facilities for the storage of asphalt after November 1, 1965.

By letter dated March 20, 1967, accepted by Trumbull on April 1, 1967, Permian again agreed to furnish certain tanks to Trumbull for the purpose of terminaling asphalt for its account and to furnish certain equipment and “labor, utilities and other incidental expense required to handle your material with these facilities”. It was later agreed that Permian would not cancel “the present agreement” prior to April 1, 1968.

According to Permian, the agreement that was in effect between the parties at the time the storage tank ruptured was oral, intended to last just long enough to liquidate the existing inventory that was in the tank storage farm, and as soon as all of the asphalt was shipped out the entire operation would be discontinued. According to Trumbull, the basic agreement evidenced by the letter simply continued the arrangement between the parties as the *558 same existed under the written terminaling agreement executed in the latter part of 1964.

Trumbull’s asphalt was shipped by barges to the dock at Port Brownsville, where it was pumped through pipelines owned by Permian into the tanks that were leased to Trumbull. The unloading operations were conducted by Permian.

In May of 1968, Trumbull needed additional storage. The only tank not in service was tank #9, that, according to Permian, was in poor condition. Permian claims that it told Trumbull that the tank was unsafe and would not hold asphalt. Trumbull denied that any such statements were made, but dispatched A. D. Morgan, one of its employees, to the tank farm. He inspected the tank, made certain repairs and installed the necessary heating coils, all at Trumbull’s expense.

On May 22, 1968, Trumbull shipped two barges containing 32,000 barrels of hot liquid asphalt to the tank farm for unloading and storage. At that time the total tank storage available to Trumbull, including tank #9, amounted to 33,000 barrels. Unloading operations were commenced. Initially, asphalt was pumped into other tanks but was switched over to tank #9 at about 9:00 in the evening. Pumping operations into tank #9 continued until 4:00 a. m. the next morning, when Mr. Pierce, (the tank farm foreman for Permian) noted a bulge in this tank. Pierce, without order from anyone, installed a cable about six feet off of the ground around the outside of tank #9 in order to strengthen the tank. Pumping operations into tank #9 were stopped but were continued into other tanks. Schofield (Permian’s tank farm superintendent) arrived at the tank farm at about 7:30 a. m. and was informed by Pierce of what had happened. Tank #9 was then inspected by Schofield who told Pierce “to wait until Mr. Morgan got there”. There is a conflict in the evidence as to what Pierce told Morgan when he arrived at the tank farm at about 8:30 that morning; Pierce testified that he showed Morgan the bulge in the tank and told him that he had put a cable around it and that Morgan said “well, that is fine” and that Morgan then told him to go ahead and fill tank #9. Morgan denied the statements so made by Pierce and insisted that no one had called his attention to the bulge in the tank or that a cable had been placed around the tank or that he told Pierce to continue pumping operations into the tank. Pumping operations were resumed into tank #9 at about 9:00 a. m. and were shut down the same morning at about 11:00 a. m. when the usable capacity in the tank was reached. At about 2:00 p. m., tank #9 burst, causing its entire contents (9,130 barrels of liquid asphalt) to spill and to spread over a considerable portion of the tank farm.

With respect to Permian’s points presented by this appeal, the jury found substantially as follows: (a) at the time tank #9 was made available to Trumbull for the storage of liquid asphalt, the supervisory personnel of Permian knew that the condition of the tank was such that it would not hold liquid asphalt; (b) the furnishing of tank #9 by Permian and the pumping of liquid asphalt into it constituted negligence and a proximate cause of the collapse of the tank; (c) the supervisory employees of Permian knew and appreciated the risk of liquid asphalt being spilled on Permian’s premises if such asphalt was pumped into tank #9; (d) the conduct of Permian in permitting liquid asphalt to be pumped into tank #9 was negligence and a proximate cause of the occurrence in question. With respect to Trumbull’s points, the jury found: (a) prior to the rupturing of tank #9, supervisory employees of Trumbull knew that the walls of the tank were bulging, knew and appreciated the risk of liquid asphalt being spilled on the premises after discovery that the walls were bulging, and with such knowledge and appreciation of the risk put asphalt into the tank; (b) A. D. Morgan of Trumbull knew that the walls of tank #9 were bulging after the tank had been partially *559 filled with liquid asphalt, and that he, with such knowledge, instructed Robert Pierce to continue to fill the tank; (c) the pumping of liquid asphalt into tank #9 after A. D.

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Bluebook (online)
472 S.W.2d 555, 1971 Tex. App. LEXIS 2105, Counsel Stack Legal Research, https://law.counselstack.com/opinion/permian-corporation-v-trumbull-asphalt-co-of-del-texapp-1971.