Temple EasTex, Inc. v. Old Orchard Creek Partners, Ltd.

848 S.W.2d 724, 1992 Tex. App. LEXIS 3300, 1992 WL 352985
CourtCourt of Appeals of Texas
DecidedDecember 1, 1992
Docket05-90-00773-CV
StatusPublished
Cited by54 cases

This text of 848 S.W.2d 724 (Temple EasTex, Inc. v. Old Orchard Creek Partners, Ltd.) 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
Temple EasTex, Inc. v. Old Orchard Creek Partners, Ltd., 848 S.W.2d 724, 1992 Tex. App. LEXIS 3300, 1992 WL 352985 (Tex. Ct. App. 1992).

Opinion

OPINION ON REHEARING

KINKEADE, Justice.

We grant in part and overrule in part appellants’ motions for rehearing and grant appellant Red Gillard Plumbing Co., Inc.’s motion for modification of judgment. We withdraw our opinion of September 30, 1992, and vacate our judgment of that date. This is now the Court’s opinion.

Temple EasTex and Red Gillard Plumbing Company appeal a judgment rendered for Old Orchard Creek Partners in this negligence and products liability cause of action. Greener & Sumner Construction Company appeals a judgment rendered for Temple EasTex and Red Gillard Plumbing Company granting them rights of contribution against Greener & Sumner.

All three appellants allege multiple points of error. Collectively, they argue that there is insufficient evidence to support the jury’s findings and that the trial court erred in (1) its interpretation of the construction contract, (2) granting a joint and several judgment, (3) granting rights of contribution, and (4) seating an alternate juror.

Because the trial court erred (1) in its interpretation of the construction contract, (2) in holding Red Gillard jointly and severally liable with Temple EasTex, and (3) in holding Red Gillard and Greener & Sumner liable for contribution, we reverse the trial court’s judgment as to Red Gillard and Greener & Sumner and render judgment for Red Gillard and Greener & Sumner. Because the trial court improperly seated the alternate juror, we remand the remainder of this cause to the trial court.

FACTUAL AND PROCEDURAL HISTORY

In 1983, Old Orchard Creek Partners, Ltd. owned an apartment complex under construction in Lewisville, Texas, known as the Oak Tree Village Apartments. Old Orchard hired Greener & Sumner as the general contractor for the construction project. Greener & Sumner hired Red Gillard as a subcontractor to coordinate the installation of the plumbing fixtures in the apartment buildings. Red Gillard hired N & H Plumbing Company to perform the plumbing construction in certain buildings.

On September 1, 1983, Ricky Minnis and Anthony Rawlinson, two employees of N & H Plumbing, were “sweating pipes” on the third floor of one of the apartment buildings. The flame from Rawlinson’s torch set fire to a piece of fiberboard manufactured by Temple EasTex. Rawlinson and Minnis poured water over the flame to extinguish the fire. Because there was no smell or sign of flames or smoke during the next thirty minutes, Rawlinson and Minnis concluded that they had successfully extinguished the fire. Two to three hours later, a fire was spotted in the same building in which Minnis and Rawlinson had been working. The Lewisville Fire Department arrived at the scene but could not stop the fire from spreading. As a result, the fire destroyed almost the entire apartment complex.

Old Orchard, as owner, brought this action in its own right and on behalf of the Insurance Company of the State of Pennsylvania, its subrogee, alleging negligence and products liability claims in connection with the fire damage to the apartment complex under construction. Old Orchard brought suit against Temple EasTex and *729 Red Gillard. Red Gillard then filed a third-party action against Johnny Nunez and Bill Hardin, individually and d/b/a N & H Plumbing. Temple EasTex filed a third-party action against Greener & Sumner and filed cross-claims against Red Gillard and N & H Plumbing. Old Orchard alleged that Temple EasTex manufactured defectively designed fiberboard used in the construction of the complex and that plumbers working for or under Red Gillard negligently caused a smoldering fire in the fiberboard that later rekindled and spread, destroying most of the project.

The jury found that (1) the design defect in the fiberboard was a producing cause of the occurrence, (2) N & H’s plumbers were negligent, and (3) Greener & Sumner was negligent. It apportioned causation as follows: (1) N & H Plumbing, 60%; (2) Red Gillard, 22.5%; (3) Greener & Sumner, 10%; and (4) Temple EasTex, 7.5%. N & H Plumbing has not perfected an appeal.

The trial court entered a joint and several judgment against Temple EasTex and Red Gillard for the stipulated damages of $7,729,564.81. The trial court then granted rights of contribution to these two defendants against one another and against Greener & Sumner and N & H Plumbing.

WAIVER

In Red Gillard’s first and second points of error and Greener & Sumner’s third point of error, they contend that the trial court erred in not giving effect to either the waiver provision or the property insurance provision in the construction contract. They argue that Old Orchard waived any claims against them for damages caused by fire to the extent that its losses were covered by insurance, under section 11.3.6 of the construction contract. To the extent that Old Orchard’s losses exceeded insurance coverage, Red Gillard and Greener & Sumner argue that Old Orchard assumed the risk of loss by breaching section 11.3.1 of the construction contract by failing to notify Greener & Sumner that it was not maintaining insurance on the property to its full insurable value.

Old Orchard argues that the contract between itself and Greener & Sumner is not a blanket waiver of liability and that Red Gillard is not entitled to benefit from its provisions. Old Orchard further argues that, even if the waiver clause applies to Red Gillard, it applies only to the extent covered by insurance and, therefore, Red Gillard is not exonerated from all liability. Red Gillard responds that it is a third-party beneficiary of the construction contract and is, therefore, entitled to benefit from the contract’s provisions.

The contract between Old Orchard, owner, and Greener & Sumner, contractor, is a standard form contract A201-1976 provided by the American Institute of Architects (AIA). The contract provides in part:

Section 11.3.1 Unless otherwise provided, the Owner shall purchase and maintain property insurance upon the entire Work at the site to the full insurable value thereof. This insurance shall include the interests of the Owner, the Contractor, Subcontractors and Sub-subcontractors in the work and shall insure against the perils of fire, extended coverage, and shall include “all risk” insurance for physical loss or damage including, without duplication of coverage, theft, vandalism and malicious mischief. If the Owner does not intend to purchase such insurance for the full insurable value of the entire Work, he shall inform the Contractor in writing prior to commencement of the Work. The Contractor may then effect insurance which will protect the interests of himself, his Subcontractor and the Sub-subcontractors in the work, and by appropriate Change Order the cost thereof is charged to the Owner. If the Contractor is damaged by failure of the Owner to purchase or maintain such insurance and to notify the Contractor, then the Owner shall bear all reasonable costs properly attributable thereto.
Section 11.3.6 The Owner and Contractor waive all rights against (1) each other and the Sub-contractors, Sub-subcontractors, agents and employees each of the other, and (2) the Architect and separate contractors, if any, and their

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Bluebook (online)
848 S.W.2d 724, 1992 Tex. App. LEXIS 3300, 1992 WL 352985, Counsel Stack Legal Research, https://law.counselstack.com/opinion/temple-eastex-inc-v-old-orchard-creek-partners-ltd-texapp-1992.