COURT OF APPEALS

SECOND DISTRICT OF TEXAS

FORT WORTH

NO. 02-12-00201-CV

MARY ELLEN LITTLE, BECKY 

LITTLE ANTHONY, TRICIA ROSE 

JACKSON, ERIC JOHN LITTLE, 

JAMES SHANNON LITTLE, WIDOW 

AND CHILDREN OF JOHNNY 

JAMES LITTLE, DECEASED, AND 

DEBRA DEE KEEFER, AS 

INDEPENDENT EXECUTRIX OF 

THE ESTATE OF JOHNNY JAMES 

LITTLE, DECEASED

APPELLANTS

V.

DELTA STEEL, INC. AND 

RELIANCE STEEL & ALUMINUM 

CO.

APPELLEES

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FROM THE 48TH DISTRICT COURT OF TARRANT COUNTY

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2

OPINION

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In two issues, appellants, whom we have listed above, appeal the final 

judgment that the trial court rendered in favor of appellees Delta Steel, Inc. (Delta 

Steel) and its parent company, Reliance Steel & Aluminum Co. (Reliance). 

Appellants contend that the trial court erred by denying their motions for 

summary judgment, granting appellees’ motions for summary judgment, and 

making allegedly incorrect rulings on appellants’ objections to appellees’ 

summary judgment evidence. We affirm in part and reverse and remand in part.

Background Facts

Johnny Little began working for Delta Steel, a steel fabrication company, in 

January 1997. During Little’s employment, in which he operated cranes at Delta 

Steel’s Fort Worth plant,

1 he designated his spouse, Mary, to receive benefits if

he died.

In March 2009, Delta Steel’s Fort Worth plant had four overhead cranes 

that used electromagnets to lift steel. On March 11, 2009, a thunderstorm, 

containing driving rain and lighting, moved near Delta Steel’s Fort Worth plant. 

At a little after 6 a.m. that day, Little was using an electromagnetic crane to move 

a steel plate when the plate dislodged from the magnet, fell, crushed him, and 

killed him.

 1

Delta Steel’s corporate office is in Houston.
3

On the date of Little’s death, three of the cranes at Delta Steel’s Fort Worth 

plant had battery backup units, but the crane that Little was operating when he 

died did not have such a unit. Battery backup units allow a crane’s 

electromagnetic system to hold a steel load for a temporary period of time even if 

the crane’s normal electromagnetic system is not functioning properly. According 

to Jackie Walters, who maintains equipment for Delta Steel at its Fort Worth 

location and who previously worked for a company that inspected Delta Steel’s 

cranes, if an electromagnetic crane that does not have a battery backup unit 

loses power, it will “drop whatever it has on it.” Before and after Walters began 

working for Delta Steel, he notified one of Delta Steel’s officials about the lack of 

a battery backup unit on the crane that Little was using when he died.

Appellants initially sued only Delta Steel for the events related to Little’s 

death. In their May 2009 original petition, appellants pled for wrongful death and 

survival damages, including punitive damages, contending that Little’s death had 

been proximately caused by Delta Steel’s negligence and gross negligence. 

Particularly, appellants alleged that Delta Steel had failed to provide a reasonably 

safe place to work, had failed to provide safe equipment for employees to work 

with, and had failed to properly train and supervise employees.

Appellants later amended their petition to add Reliance as a defendant, 

asserting that Reliance owned Delta Steel, had undertaken a responsibility to 

ensure safety for Delta Steel’s employees, and had negligently and grossly 

negligently failed to perform that responsibility. In their second amended petition, 
4

appellants alleged, among other facts, that Little’s death was caused by a failure 

of a crane’s electromagnetic lifting system, that Delta Steel had made a 

“conscious decision to remove the battery backup unit from the . . . crane,” and 

that Delta Steel had ignored warnings about the danger of employees operating 

a crane that did not have a battery backup unit.

2

Appellees answered appellants’ claims by asserting a general denial and 

by pleading several affirmative defenses, including that they were “subscribers to 

[workers’] compensation insurance at the time of the injuries, and therefore, 

[appellants were] barred from any recovery.” In a later pleading, appellees also 

contended that appellants were estopped from claiming damages outside of 

workers’ compensation because they had elected to receive workers’ 

compensation benefits.

All parties sought summary judgment, at least in part. Reliance argued, 

through a traditional summary judgment motion (and an amended motion), that it 

could not be liable for negligence or gross negligence because as Delta Steel’s 

parent company at the time of Little’s death, it was a distinct legal entity from 

Delta Steel, it did not have a duty to control Delta Steel’s day-to-day operations 

and did not in fact do so, it did not owe any duty of care to Little, and only Delta 

 2

In the trial court, appellees contended that Little’s death could have been 

caused by the steel plate dislodging from the magnet after hitting an object, 

which was an “event that would not have been avoided through the use of a 

battery backup unit.” The issues raised by the parties in this appeal do not 

require us to express an opinion concerning the cause of the dislodging of the 

steel plate from the crane that Little was operating when he died.
5

Steel could have owed such a duty. Reliance asserted that it had not hired, 

supervised, or trained Little and had not exercised sufficient control of Delta 

Steel’s safety policies to create a duty toward Little. Reliance also argued, 

through a no-evidence motion for summary judgment, that even if appellants 

could produce evidence establishing a duty by Reliance to Little, appellants could 

not produce evidence that raised a genuine issue of material fact that Reliance 

was grossly negligent in breaching any duty.

In its October 2011 motion for partial summary judgment, Delta Steel 

contended that it was covered by workers’ compensation insurance when Little 

died and that it therefore could not be liable under appellants’ ordinary 

negligence claim because section 408.001(a) of the labor code3 precluded the 

claim. In an effort to prove this assertion, Delta Steel attached, among other 

documents, a lengthy insurance policy issued by the Zurich-American Insurance 

Group (Zurich). The Zurich policy, which was effective for one year beginning 

September 1, 2008, designated Reliance as the “Named Insured,” and although 

the policy contained a schedule of insureds and locations that named several 

other companies, the schedule did not name Delta Steel.4

 However, the policy 

listed an entity described as “Delta” in a workers’ compensation classification 

schedule, and the policy appeared to calculate premiums for various groups of 

 3

See Tex. Labor Code Ann. § 408.001(a) (West 2006).

4

The schedule listed companies bearing Reliance’s name and companies 

not containing “Reliance.”
6

employees for “Delta.” The documents attached by Delta to its motion for partial 

summary judgment also included an endorsement to the Zurich policy issued in 

May 2010 (after Little’s death), which stated that it was agreed that Delta Steel 

had been “added to th[e] policy effective at its inception” on September 1, 2008.5

Delta Steel later filed an amended and supplemented motion for partial 

summary judgment. In that motion, Delta Steel expressly incorporated the 

October 2011 motion, repeated its argument concerning section 408.001 of the 

labor code, and additionally contended that appellants were estopped from 

pursing their ordinary negligence claim through Mary’s acceptance of workers’ 

compensation benefits.

Appellants sought summary judgment against appellees’ statutory 

exclusive remedy affirmative defense, asserting that appellees could not produce 

any evidence supporting the defense. In their motion for summary judgment, 

appellants conceded that Mary had received workers’ compensation benefits, but 

they alleged that the benefits had been paid under the Zurich policy that covered 

only Reliance. As summary judgment evidence, appellants produced, among 

other documents, printouts from a governmental website showing that a search 

of the website did not return Delta Steel as a company covered by workers’ 

 5

Along with the endorsement, Zurich issued a letter to a representative at 

Marsh Risk & Insurance Services (Marsh), which was the producer of the Zurich 

policy. The letter stated in part, “Enclosed please find . . . your copy of 

endorsement #6, adding Delta Steel, Inc. on the above policy effective at 

inception.” The summary judgment evidence establishes that Zurich issued the 

endorsement upon Marsh’s request.
7

compensation insurance. Thus, stemming from broad contentions that parent 

and subsidiary corporations are distinct legal entities, that Reliance had not 

exercised control over Little’s work at Delta Steel, that Little’s work had not 

furthered Reliance’s business, and that coverage for a related entity is insufficient 

for an employer to claim the benefit of section 408.001, appellants argued that 

Delta Steel could not benefit from the exclusive remedy defense because it was

not explicitly covered under a workers’ compensation policy at the time of Little’s 

death and that Reliance could not succeed on the defense because it had not 

employed Little.

Appellants also responded to Reliance’s traditional summary judgment 

motion and filed a motion for summary judgment on their negligent undertaking 

claim against Reliance, contending that the summary judgment evidence 

conclusively proved that Reliance had undertaken a duty “to perform services 

that it knew or should have known were necessary for the protection of [Delta 

Steel’s] warehouse employees”; that Reliance, through various acts or failures to 

act, had breached that duty; and that Reliance was also grossly negligent

because although it knew of Delta Steel’s “poor safety rating,” it had chosen not 

to audit Delta Steel’s Fort Worth plant. Reliance responded to appellants’ motion

for summary judgment on their negligent undertaking claim by asserting, in part, 

that appellants had not proved any affirmative act establishing an undertaking of 

a duty toward Little.
8

The trial court denied appellants’ motions for summary judgment, granted 

appellees’ motions for summary judgment, and overruled objections that 

appellants had asserted concerning Delta Steel’s summary judgment evidence. 

Appellants asked the trial court to reconsider its decision to grant summary 

judgment for Delta Steel, contending in part that Delta Steel’s estoppel and 

election of remedies affirmative defenses (as distinguished from its statutory 

exclusive remedy affirmative defense) had not been timely and properly pled.6

 

Appellants also contended that Mary’s acceptance of workers’ compensation 

benefits could not bar appellants’ claims under estoppel or election of remedies 

theories because she did not have knowledge of all material facts concerning the 

acceptance of the benefits and had not made an informed choice to accept them.

The trial court declined to reconsider its decision granting summary

judgment for appellees. The court eventually severed appellants’ still-pending 

gross negligence claim against Delta Steel7 from all of the other claims against 

Delta Steel and Reliance on which the trial court had granted summary judgment 

in appellees’ favor. Appellants brought this appeal.

 6

On appeal, appellants have not raised a complaint about the timing of 

Delta Steel’s pleading.

7

The statutory exclusive remedy defense does not preclude claims based 

on an employer’s gross negligence that causes an employee’s death. Tex. Labor 

Code Ann. § 408.001(b); Port Elevator-Brownsville, L.L.C. v. Casados, 358 

S.W.3d 238, 241 (Tex. 2012).
9

Summary Judgment Standards

We review a trial court’s summary judgment rulings de novo. Travelers 

Ins. Co. v. Joachim, 315 S.W.3d 860, 862 (Tex. 2010); Foreman v. Whitty, 392 

S.W.3d 265, 270 (Tex. App.—San Antonio 2012, no pet.). When both parties 

move for summary judgment and the trial court grants one motion and denies the 

other, we review the parties’ summary judgment evidence and determine all 

questions presented. Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 

S.W.3d 844, 848 (Tex. 2009); see Myrad Props., Inc. v. Lasalle Bank Nat’l Ass’n, 

300 S.W.3d 746, 753 (Tex. 2009). The reviewing court should render the 

judgment that the trial court should have rendered. Mann Frankfort, 289 S.W.3d 

at 848.

In a traditional summary judgment case, the issue on appeal is whether 

the movant met the summary judgment burden by establishing that no genuine 

issue of material fact exists and that the movant is entitled to judgment as a 

matter of law. Id. We take as true all evidence favorable to the nonmovant, and 

we indulge every reasonable inference and resolve any doubts in the 

nonmovant’s favor. 20801, Inc. v. Parker, 249 S.W.3d 392, 399 (Tex. 2008); 

Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003). 

We consider the evidence presented in the light most favorable to the 

nonmovant, crediting evidence favorable to the nonmovant if reasonable jurors 

could and disregarding evidence contrary to the nonmovant unless reasonable 

jurors could not. Mann Frankfort, 289 S.W.3d at 848. We must consider whether 
10

reasonable and fair-minded jurors could differ in their conclusions in light of all of 

the evidence presented. See Wal-Mart Stores, Inc. v. Spates, 186 S.W.3d 566, 

568 (Tex. 2006); City of Keller v. Wilson, 168 S.W.3d 802, 822–24 (Tex. 2005). 

The summary judgment will be affirmed only if the record establishes that the 

movant has conclusively proved all essential elements of the movant’s cause of 

action or defense as a matter of law. City of Houston v. Clear Creek Basin Auth., 

589 S.W.2d 671, 678 (Tex. 1979).

The Trial Court’s Decision to Grant Summary Judgment for Delta Steel

In their first issue, appellants contend that the trial court erred by granting 

summary judgment for Delta Steel because Delta Steel failed to prove as a 

matter of law that it was covered by workers’ compensation insurance at the time 

of Little’s death (and was therefore protected by the application of the exclusive 

remedy provision in section 408.001(a)) or that Mary’s acceptance of benefits 

under the Zurich policy barred appellants’ negligence claim through the common 

law affirmative defenses of acceptance of benefits or election of remedies. In 

addition to asserting that the literal application of section 408.001(a) precludes 

appellants’ negligence claims, Delta Steel contends that the trial court’s summary 

judgment decision was appropriate because estoppel principles preclude 

appellants from asserting an ordinary negligence claim after Mary applied for and 

received workers’ compensation benefits. Because the trial court did not specify 

the basis for its decision to grant summary judgment for Delta Steel, we must 

affirm the judgment if any ground that Delta Steel raised in the trial court is 
11

meritorious. Collier v. Allstate Cnty. Mut. Ins. Co., 64 S.W.3d 54, 58 (Tex. App.—

Fort Worth 2001, no pet.) (citing Star-Telegram, Inc. v. Doe, 915 S.W.2d 471, 

473 (Tex. 1995)).

The labor code provides that recovery of workers’ compensation benefits is 

the “exclusive remedy of an employee covered by workers’ compensation 

insurance coverage or a legal beneficiary against the employer . . . for the death 

of or a work-related injury sustained by the employee.” Tex. Labor Code Ann. 

§ 408.001(a); see Morales v. Liberty Mut. Ins. Co., 241 S.W.3d 514, 516 (Tex. 

2007) (“The Texas Workers’ Compensation Act provides exclusive compensation 

benefits for the work-related injuries of a subscribing employer’s employees.”). 

As the supreme court has explained, section 408.001(a) specifically, along with 

the labor code’s provisions relating to workers’ compensation benefits generally, 

aids both

employees and employers. For employees, the [labor code] allows 

them to recover workers’ compensation benefits for injuries in the 

course and scope of employment without proving fault by the 

employer and without regard to their negligence or that of their 

coworkers. . . . For employers, their liability to employees is limited.

Casados, 358 S.W.3d at 241. To enjoy the liability protection offered by section 

408.001(a), an employer must show that it was explicitly covered for workers’ 

compensation at the time of the employee’s injury. See Garza v. Exel Logistics, 

Inc., 161 S.W.3d 473, 477–79 (Tex. 2005) (holding that workers’ compensation 

coverage for a temporary employment agency did not protect the agency’s client 

company under section 408.001(a) and that “employers cannot agree that one 
12

workers’ compensation policy will name only one employer but cover both”); 

Warnke v. Nabors Drilling USA, L.P., 358 S.W.3d 338, 343 (Tex. App.—Houston 

[1st Dist.] 2011, no pet.) (op. on reh’g).

Although appellants contest whether the Zurich policy provided explicit 

coverage for Delta Steel, they concede that Delta Steel was Little’s employer and 

that Mary received benefits under that policy. They contend, however, that 

Mary’s receipt of benefits does not preclude them from suing Delta Steel for 

negligence because Mary “did not pursue the benefits but merely began 

receiving them, not knowing if Delta [Steel] was or was not a covered entity. . . . 

Thus, any election she made was not an informed one.”

In the trial court and in this court, appellants have characterized Delta 

Steel’s common law affirmative defense as quasi-estoppel. We have explained 

that quasi-estoppel is

an affirmative defense that “precludes a party from asserting, to 

another’s disadvantage, a right inconsistent with a position 

previously taken. The doctrine applies when it would be 

unconscionable to allow a person to maintain a position inconsistent 

with one to which he acquiesced, or from which he accepted a 

benefit.” Lopez v. Munoz, Hockema & Reed, L.L.P., 22 S.W.3d 857, 

864 (Tex. 2000) (citation omitted); see Brooks v. Brooks, 257 

S.W.3d 418, 423 (Tex. App.—Fort Worth 2008, pet. denied) 

(explaining that “unlike equitable estoppel, quasi-estoppel requires 

no showing of misrepresentation or detrimental reliance”). “Thus, 

quasi estoppel forbids a party from accepting the benefits of a 

transaction . . . and then subsequently taking an inconsistent 

position to avoid corresponding obligations or effects.” Atkinson Gas 

Co. v. Albrecht, 878 S.W.2d 236, 240 (Tex. App.—Corpus Christi 

1994, writ denied).
13

Clark v. Cotten Schmidt, L.L.P., 327 S.W.3d 765, 770 (Tex. App.—Fort Worth 

2010, no pet.) (emphasis added).

We have applied the quasi-estoppel affirmative defense in circumstances 

that are analogous to the facts of this case. For example, in Lindley v. McKnight, 

an estate had accepted money that corporations had paid for redemption of stock 

shares under the terms of shareholders’ agreements but had nonetheless

brought a suit, through an independent executor, to contest the enforceability of 

the shareholders’ agreements and to claim that the corporations had violated 

them. 349 S.W.3d 113, 120–22, 130–33 (Tex. App.—Fort Worth 2011, no pet.). 

We held that the estate’s acceptance of benefits precluded its pursuit of those 

claims, explaining in part,

[The estate’s] UDJA and breach of contract claims challenge 

either the validity of the shareholders’ agreements or the actions that 

the corporations took under the agreements. But [the] estate 

accepted benefits that it could not have received if the agreements 

are not valid and were not complied with. . . . The record contains 

copies of checks . . . sent by the corporations to [the] estate and 

negotiated by [the independent executor].

. . . The only reason that [the] estate could have been entitled 

to receive specific payments totaling $733,806.63 is the redemption 

of the stock under section five of the shareholders’ agreements. . . .

Throughout the course of this litigation, which began in 2000, [the 

independent executor] never returned the money that the 

corporations tendered to [the] estate. We conclude that it would be 

unconscionable to allow [the] estate to retain the benefit it received 

for the redemption of [the decedent’s] shares while it concurrently 

challenges the provisions of the shareholders’ agreements that 

made the redemption possible.

Id. at 131–32.
14

Similarly, in Doe v. Texas Association of School Boards, Inc., we held that 

quasi-estoppel precluded a party who obtained money under a settlement 

agreement from contending that she did not have the authority to provide the 

consideration required to secure the money. 283 S.W.3d 451, 464 (Tex. App.—

Fort Worth 2009, pet. denied) (citing Brooks, 257 S.W.3d at 423); see also 

Mulvey v. Mobil Producing Tex. & N.M. Inc., 147 S.W.3d 594, 607–08 (Tex.

App.—Corpus Christi 2004, pets. denied) (stating that quasi-estoppel “essentially 

requires (1) a previous action and (2) a subsequent inconsistent action which is 

thereby sought to be estopped” and holding that quasi-estoppel barred a party 

from challenging an agreement that it accepted benefits under); Eckland 

Consultants, Inc. v. Ryder, Stilwell Inc., 176 S.W.3d 80, 81–83, 87–88 (Tex.

App.—Houston [1st Dist.] 2004, no pet.) (holding that quasi-estoppel prevented a 

property inspection company from claiming that a plaintiff did not have standing 

to sue for a breach of an inspection contract when the company accepted the 

benefits of the contract and stated in an inspection report that noncontracting 

entities could rely on the report); Twelve Oaks Tower I, Ltd. v. Premier Allergy, 

Inc., 938 S.W.2d 102, 111 (Tex. App.—Houston [14th Dist.] 1996, no writ) 

(“Premier, a party which . . . availed itself of the benefits of the lease for over a 

year, may not challenge the validity of the [l]ease . . . .”).
15

The evidence establishes that Carol Gallimore, a claims representative,8

began handling Little’s workers’ compensation insurance claim on March 11, 

2009 (which was the day that he died). Gallimore asked Zurich whether Delta 

Steel’s Fort Worth plant had workers’ compensation coverage, and she was told 

that coverage existed.9

 Upon being told that Delta Steel’s Fort Worth plant had 

workers’ compensation coverage, Gallimore began administering the claim.

For example, on March 26, 2009, Gallimore spoke with Mary’s counsel 

regarding the claim, and on the same day, Mary signed a form concerning 

compensation benefits and faxed the form to Gallimore. The form listed Delta 

Steel as Little’s employer, named Mary as the eligible beneficiary, expressed that 

Mary was claiming burial benefits and death benefits,10 and stated, “Beneficiaries 

of an employee who died from an on-the-job injury or occupational disease must 

file this form with the Texas Department of Insurance, Division of Workers’ 

Compensation (Division) . . . to protect your claim for entitlement to death 

benefits.” During the process of Gallimore’s administration of the workers’

 8

Gallimore works for ESIS. ESIS is a third-party administrator, meaning 

that it assesses and resolves insurance claims for employers and insurance 

carriers.

9

Gallimore, who explained that she had seen insurance policies that 

simultaneously covered parent corporations and their subsidiaries, confirmed that 

she “relied totally” on what Zurich told her about coverage; she did not, near the 

time of Little’s death, review Zurich’s policy.

10The record establishes that Gallimore informed a funeral home that 

Little’s funeral-related expenses would be paid under the Zurich policy.
16

compensation claim, Mary “produced evidence” of Little’s death, and either Mary 

or her counsel verified Little’s scope of employment with Delta Steel.

On March 27, 2009, Gallimore prepared a document titled 

“NOTIFICATION OF FIRST DEATH BENEFIT PAYMENT.” The notification, 

which was addressed to Mary, stated that through the Zurich policy, Mary would 

begin receiving weekly death benefits in the amount of $597.40. The notification, 

which listed Reliance as Little’s employer, also informed Mary to contact 

Gallimore if she did not agree with the amount of the benefit.

After receiving benefits for a couple of months, in June 2009, Mary, after 

suing Delta Steel, applied with the Texas Workers’ Compensation Commission to 

change her benefits from weekly to monthly payments through the purchase of 

an annuity with the Metropolitan Life Insurance Company (MetLife). The form for 

the application listed Delta Steel as Little’s employer, designated Zurich as the 

insurance carrier, and expressed that Mary would begin receiving a monthly 

death benefit of $2,597.62 through the annuity. Mary, her counsel, and 

Gallimore signed the form. Zurich and MetLife executed a reinsurance 

agreement concerning the annuity; the agreement expressed that Mary would 

receive “$2,597.62 for life, payable monthly beginning” on July 1, 2009.

Despite this evidence that conclusively proves Mary’s application for and 

receipt of workers’ compensation benefits on account of Little’s death that 

occurred during his employment with Delta Steel, appellants contend that quasiestoppel does not preclude them from inconsistently contesting Delta Steel’s 
17

workers’ compensation coverage because Mary did not make an informed choice 

between two inconsistent positions and because she was misled “as to the party

that was responsible for paying the benefits.” We have explained that there can 

be no “estoppel from acceptance of the benefits by a person who did not have 

knowledge of all material facts.” Clark, 327 S.W.3d at 770 (quoting Frazier v. 

Wynn, 472 S.W.2d 750, 753 (Tex. 1971)). But even if Mary did not have 

knowledge of the effect of accepting workers’ compensation benefits on her 

negligence claim against Delta Steel in the early part of 2009 or if she accepted 

them at that time only because she assumed, based on representations made to 

her, that Delta Steel was covered under the Zurich policy, the evidence provides 

reasons for us to conclude that Mary later had knowledge of the material facts 

related to her acceptance of benefits while she continued to accept them. Cf. 

Lindley, 349 S.W.3d at 133 (holding that quasi-estoppel applied because even if

“there was some point in the past when [the decedent] did not know” of stock 

transfer restrictions, the decedent’s estate “accepted the benefit in question . . .

at a time that it knew all facts regarding the distribution of that benefit and the 

actual rejection of the transfer”).

First, in responding to Delta Steel’s motion for summary judgment, Mary 

filed an affidavit in which her counsel conceded that in June 2009 (before Mary’s 

weekly payments were officially converted to monthly payments through the 

annuity), Delta Steel answered appellants’ lawsuit by “asserting that [appellants’] 

claims [were] barred by an exclusive-remedy provision of the Texas Workers’ 
18

Compensation Act.”11 Next, appellants admitted in the trial court, through their 

counsel’s affidavit, that in December 2009, Delta Steel provided the Zurich policy 

to them.

Therefore, it cannot be disputed that by December 2009, appellants had 

the Zurich policy, knew that Delta Steel was claiming to be insured under it, knew 

that Delta Steel was asserting the benefit of the exclusive remedy defense under 

section 408.001(a), and had the ability to ascertain whether the policy provided 

coverage.

12 Nonetheless, at a deposition in January 2012, which was more than 

two years later, Gallimore testified that Mary was still receiving workers’ 

compensation benefits through the annuity.13 No evidence exists that at any 

 11Specifically, Delta Steel’s original answer stated in part, 

Defendant specially excepts to Plaintiffs’ allegations concerning 

negligence, as they are strictly prohibited by the Texas Labor Code. 

More specifically, [section 408.001(a)] states that . . . “recovery of 

workers’ compensation benefits is the exclusive remedy of an 

employee covered by workers’ compensation insurance coverage or 

a legal beneficiary against the employer or an agent or employee of 

the employer for the death of or a work-related injury sustained by 

the employee.” . . . Defendant requests that the Court sustain this 

special exception and order the Plaintiffs to replead their petition and 

remove any causes of action pertaining to negligence . . . .

12Appellants argue that any coverage determination was discernable from 

the four corners of the policy.

13Appellants did not produce evidence in the trial court to contradict 

Gallimore’s deposition testimony that Mary was still receiving benefits through 

the annuity in January 2012. By January 2012, although Mary was receiving 

benefits, appellants had filed a motion for summary judgment on Delta Steel’s 

exclusive remedy defense, claiming that no evidence existed to show that Delta 

Steel had coverage.
19

point after December 2009, Mary attempted to reject further workers’ 

compensation benefits based on an assertion that they were not being properly 

paid under the Zurich policy. Thus, we hold that Mary accepted benefits while 

knowing all material facts associated with doing so. See Clark, 327 S.W.3d at 

770; see also Medina v. Herrera, 927 S.W.2d 597, 603 (Tex. 1996) (concluding 

that a plaintiff who had accepted workers’ compensation benefits had made an 

“informed” election when the plaintiff had been represented by counsel in 

submitting his claim for benefits and had been receiving benefits for two years 

when he filed his lawsuit).

We note that like in Lindley, where the only reason that an estate could 

have been entitled to receive benefits was the redemption of stock under 

shareholders’ agreements that the estate challenged, the only reason that Mary 

could have been entitled to receive workers’ compensation benefits was through 

insurance coverage of Delta Steel, which was indisputably Little’s employer. The 

Texas Workers’ Compensation Act defines “[b]enefit” as a “medical benefit, an 

income benefit, a death benefit, or a burial benefit based on a compensable 

injury.” Tex. Labor Code Ann. § 401.011(5) (West Supp. 2012) (emphasis 

added). A “[c]ompensable injury” is an injury that “arises out of and in the course 

and scope of employment for which compensation is payable.” Id. § 401.011(10)

(emphasis added). The “[c]ourse and scope of employment” means an “activity 

of any kind or character that has to do with and originates in the work, business, 

trade, or profession of the employer and that is performed by an employee.” Id.
20

§ 401.011(12). Death benefits are payable to a legal beneficiary only when a 

“compensable injury to the employee results in death.” Id. § 408.181(a) (West 

2006) (emphasis added).

Appellants cite two supreme court decisions to propose that a “claimant’s 

receipt of benefits does not render the exclusive remedy provision applicable to 

the decedent’s employer.” These cases are distinguishable, however, because 

they each concerned whether more than one entity could qualify as a plaintiff’s 

employer and could establish workers’ compensation insurance coverage, which 

is not the issue in this case. See Garza, 161 S.W.3d at 474–78; Wingfoot 

Enters. v. Alvarado, 111 S.W.3d 134, 134–35 (Tex. 2003). Neither case 

concerned the factual scenario of this case: a party’s acceptance of workers’ 

compensation benefits that is inconsistent with the party’s claim that no employer 

had workers’ compensation coverage.

Finally, appellants contend that even if Mary’s acceptance of benefits 

estops her from pursing a negligence claim against Delta Steel, the acceptance 

of benefits should not estop the other appellants because each of them “have 

their own independent” wrongful death claims. For two reasons, we disagree.

First, the Texas wrongful death statute applies only if “the individual injured 

would have been entitled to bring an action for the injury if the individual had 

lived.” Tex. Civ. Prac. & Rem. Code Ann. § 71.003(a) (West 2008); see Verdeur 

v. King Hospitality Corp., 872 S.W.2d 300, 301 (Tex. App.—Fort Worth 1994, writ 

denied) (explaining that negligence claims under the wrongful death or survival 
21

statutes are derivative of the decedent’s rights). In applying for benefits, Mary 

represented that she was Little’s legal beneficiary. In a wrongful death suit, the 

decedent’s beneficiaries represent the decedent and act on the decedent’s 

behalf. See Russell v. Ingersoll-Rand Co., 841 S.W.2d 343, 345 (Tex. 1992); 

Washam v. Hughes, 638 S.W.2d 646, 648 (Tex. App.—Austin 1982, writ ref’d 

n.r.e.); see also In re Labatt Food Serv., L.P., 279 S.W.3d 640, 644 (Tex. 2009)

(orig. proceeding) (stating that it “is well established that statutory wrongful death 

beneficiaries’ claims place them in the exact ‘legal shoes’ of the decedent”). 

Thus, we conclude that Mary represented Little when she accepted benefits that 

were paid in conjunction with his employment, that her acceptance of benefits 

would have precluded him from suing Delta Steel for negligence had he lived, 

and that her acceptance of benefits therefore precludes the other appellants from 

bringing a derivative negligence claim on Little’s behalf. See Simpson v. State, 

998 S.W.2d 304, 307 (Tex. App.—Austin 1999, pet. denied) (“Because we have 

concluded that Simpson’s claims are barred under section 408.001, so too is her 

son’s loss of consortium claim.”).

Second, workers’ compensation benefits are intended to be a complete 

and adequate substitute for bringing claims under common law; as the supreme 

court has explained,

To recover damages at common law, an injured worker was 

required not only to establish that the employer’s negligence 

proximately caused the injury, but also to avoid the defenses of 

contributory negligence, assumption of the risk, and fellow 

servant. . . .
22

In comparison, the Act . . . provides benefits to injured workers 

without the necessity of proving negligence and without regard to the 

employer’s potential defenses. In exchange, the benefits are more 

limited than the actual damages recoverable at common law. We 

believe this quid pro quo, which produces a more limited but more 

certain recovery, renders the Act an adequate substitute . . . .

Tex. Workers’ Comp. Comm’n v. Garcia, 893 S.W.2d 504, 521 (Tex. 1995)

(emphasis added); see Holmans v. Transource Polymers, Inc., 914 S.W.2d 189, 

193 (Tex. App.—Fort Worth 1995, writ denied) (explaining that the “Workers’

Compensation Act is an example of the legislature’s reasonable substitute for 

common-law rights”) (footnote omitted). Thus, in light of Mary’s acceptance of 

death benefits14 with knowledge of the material facts associated with doing so, 

we conclude that the survival of a negligence claim by other appellants would be 

repugnant to the purpose of the workers’ compensation statute. See Medina, 

927 S.W.2d at 603 (holding that the pursuit and receipt of workers’ compensation 

benefits was “fundamentally inconsistent” with a common law claim).

For all of these reasons, we hold that the evidence proves, as a matter of 

law, that quasi-estoppel applies because it is unconscionable for appellants to

assert a right (the ability to sue Delta Steel for negligence) that is inconsistent 

with a position previously taken (Mary’s application for workers’ compensation 

benefits and her acceptance of the benefits over a course of more than two 

 14See Tex. Labor Code Ann. § 408.182 (West Supp. 2012) (providing for 

varying distributions of death benefits to relatives of the decedent depending on 

the age and status of the relatives and upon which relatives survive the 

decedent). None of the appellants other than Mary have asserted that they could 

have been statutorily entitled to receive death benefits.
23

years). See Lindley, 349 S.W.3d at 130–33; Clark, 327 S.W.3d at 770; see also

Berry v. Gregg Indus. Servs., Inc., 907 S.W.2d 4, 5 (Tex. App.—Tyler 1994, writ 

denied) (“[B]y claiming and collecting [workers’ compensation] benefits, Berry is 

precluded from maintaining an action at common law against his employer or 

fellow employees.”); LeJeune v. Gulf States Utils. Co., 410 S.W.2d 44, 47–48 

(Tex. Civ. App.—Beaumont 1966, writ ref’d n.r.e.) (“Appellant sought and 

obtained this award of [workers’] compensation . . . and received and accepted 

the benefits thereof. Appellant cannot be heard to . . . attempt to recover actual 

damages on the ground that Gulf States Utilities Company was not a subscriber 

under the Act.”); Heibel v. Bermann, 407 S.W.2d 945, 946 (Tex. Civ. App.—

Houston 1966, no writ) (“We are of the view that appellants, by proceeding to 

claim and collect benefits provided under the workmen’s compensation policy of 

insurance provided by the employer, . . . are as a matter of law precluded from 

maintaining an action at common law for damages . . . .”). Thus, we hold that the 

trial court did not err by granting summary judgment for Delta Steel on the ground 

that Mary’s application for and acceptance of workers’ compensation benefits 

estopped appellants from denying Delta Steel’s workers’ compensation 

coverage, from contesting the applicability of the exclusive remedy provision of 

section 408.001(a), and from pursuing a negligence claim against Delta Steel. 

See Mann Frankfort, 289 S.W.3d at 848. Because our holding on Delta Steel’s 

acceptance of benefits defense is dispositive of the trial court’s decision to grant 
24

summary judgment for Delta Steel and to deny appellants’ motion for summary 

judgment with respect to Delta Steel, we overrule appellants’ first issue.15

The Trial Court’s Decision to Grant Summary Judgment for Reliance

In their second issue, appellants contend that the trial court erred by 

granting summary judgment for Reliance on appellants’ negligence and gross 

negligence claims. On appellants’ ordinary negligence claim, Reliance sought 

summary judgment solely on the basis that as Delta Steel’s parent company, it

did not owe a duty to Little. Appellants contended in the trial court that Reliance 

was liable for its own negligence (as distinguished from being vicariously liable 

for Delta Steel’s acts)16 because it failed to provide a reasonably safe workplace 

for Delta Steel’s employees after assuming responsibility to do so, failed to 

require Delta Steel to provide safe production equipment, failed to require Delta 

Steel to properly supervise its managers so that the managers would provide a 

 15Thus, we decline to address the other contentions contained in 

appellant’s first issue, including whether the explicit terms of the original Zurich 

policy or the endorsement to the policy contractually provided coverage for Delta 

Steel. See Tex. R. App. P. 47.1; City of Haltom City v. Aurell, 380 S.W.3d 839, 

859 n.17 (Tex. App.—Fort Worth 2012, no pet.). We note that although 

appellants complain about the trial court’s evidentiary rulings in their first issue, 

they limit their arguments to challenge deposition excerpts and affidavits as proof 

of coverage because the affidavits and excerpts were based on hearsay, were 

not based on personal knowledge, and were conclusory. Because we are not 

addressing the issue of coverage beyond concluding that appellants are 

estopped from denying it, we need not opine on whether the opinions about 

coverage were admissible.

16Thus, much of Reliance’s argument in this court and in the trial court, 

which concerns whether Reliance could be vicariously liable for Delta Steel’s 

torts, if any, is inapposite.
25

safe workplace, failed to require Delta Steel to properly train its employees about 

the safe operation of electromagnetic lifting devices, and failed to require Delta 

Steel to implement and enforce policies and procedures regarding the safe 

operation of production equipment.

To prove a negligence claim, a plaintiff must establish the existence of a 

legal duty, breach of that duty, and damages proximately caused from the 

breach. Morris v. Scotsman Indus., Inc., 106 S.W.3d 751, 754 (Tex. App.—Fort 

Worth 2003, no pet.). The existence of a duty is a threshold question of law, and 

the “nonexistence of a duty ends the inquiry into whether negligence liability may 

be imposed.” Id.

As explained in Morris, in which the issue was whether a parent company 

owed a duty to an employee who was injured while working for a subsidiary,

The Texas Supreme Court has held that in cases where a 

plaintiff alleges negligence in maintaining a safe workplace, the 

plaintiff must show that the party it asserts had a duty to provide a 

safe workplace had actual control or a right of control over the 

specific aspect of the safety and security of the premises that led to 

the plaintiff’s injury. Exxon Corp. v. Tidwell, 867 S.W.2d 19, 23 (Tex.

1993); Brooks v. Nat’l Convenience Stores, Inc., 897 S.W.2d 898, 

902–03 (Tex. App.—San Antonio 1995, writ denied). A court cannot 

infer duty from evidence showing actual control or a right of control 

over the general operation of the workplace. Exxon, 867 S.W.2d at 

23. . . . [O]nly corporations that have the right to control or actually 

control safety and security policies of the workplace have a duty to

the workers to maintain a safe workplace. Id.; Brooks, 897 S.W.2d 

at 903.

Id.; see Exxon, 867 S.W.2d at 23 (“We consider . . . the nature of the matters to 

which the right of control extends to be determinative. We think that in a case 
26

alleging negligence in maintaining a safe workplace, the court’s inquiry must 

focus on who had specific control over the safety and security of the 

premises . . . .”).

The parties agree that parent corporations generally have no duty to 

control their subsidiaries. Citing section 324A of the Restatement (Second) of 

Torts, however, appellants contend that Reliance voluntarily undertook a duty to 

keep Delta Steel’s employees safe. Section 324A states, in part, that one who 

undertakes to render services to another which he should recognize as 

necessary for the protection of a third person is subject to liability to the third 

person for physical harm resulting from his failure to exercise reasonable care in 

completing the undertaking if he has undertaken to perform a duty owed by the 

other to the third person. Restatement (Second) of Torts § 324A(b) (1965); see 

Torrington Co. v. Stutzman, 46 S.W.3d 829, 837 (Tex. 2000) (“[W]e have 

recognized that a duty to use reasonable care may arise when a person 

undertakes to provide services to another, either gratuitously or for 

compensation.”); see also Olivas v. Sw. Royalties Holdings, Inc., No. 08-02-

00090-CV, 2003 WL 21919593, at *3 (Tex. App.—El Paso Aug. 12, 2003, pet. 

denied) (mem. op.) (stating that Texas courts have “recognized . . . a theory of 

liability” under section 324A).

In Abdel-Fattah v. Pepsico, Inc., a court of appeals explained that cases 

that have extended liability under section 324A to parent corporations for injuries 

to subsidiaries’ employees have
27

involved incidents where the parent corporation had engaged in an 

undertaking which directly promoted the interests of its subsidiary in 

providing a safe workplace. See Johnson v. Abbe Engineering, 749 

F.2d 1131, 1132–33 (5th Cir. 1984) (interpreting Texas law)[17] . . . . 

For instance, in Johnson, the court found a parent corporation had 

undertaken the duty of performing safety inspections at its 

subsidiary’s plant. 749 F.2d at 1132–33. When an explosion 

occurred, injuring several of the subsidiary’s employees, the parent 

corporation was found liable under a [section] 324A theory. Id. Due 

to the inspections, management at the subsidiary corporation was 

lulled into a false sense of security that the plant was safe and any 

injuries suffered as a direct result of the negligent inspection were 

logically imposed on the parent corporation which undertook such 

inspections. Id. at 1133.

Significantly, in Johnson, the court found that a duty existed 

only because the defendant had either “undertaken to inspect the 

specific instrument causing the injury or to inspect the entire plant of 

which that instrument was a part.”

948 S.W.2d 381, 385–86 (Tex. App.—Houston [14th Dist.] 1997, no writ); see 

also Muniz v. Nat’l Can Corp., 737 F.2d 145, 148 (1st Cir. 1984) (stating that a

parent corporation may be liable for a subsidiary’s unsafe conditions if the parent 

company undertakes, contractually or through conduct, to provide safe working 

conditions at the subsidiary); Bujol v. Entergy Servs., Inc., 922 So. 2d 1113, 1131

(La. 2004) (explaining that in determining whether a parent corporation 

affirmatively undertook the duty of safety owed by its subsidiary, “courts have 

 17We may rely on federal decisions and decisions from other states as 

persuasive authority. See City of Carrollton v. Singer, 232 S.W.3d 790, 797 n.6 

(Tex. App.—Fort Worth 2007, pet. denied); SpawGlass Const. Corp. v. City of 

Houston, 974 S.W.2d 876, 881 (Tex. App.—Houston [14th Dist.] 1998, pet. 

denied).
28

looked to the scope of the parent’s involvement, the extent of the parent’s 

authority, and the underlying intent of the parent”).

The Dallas Court of Appeals applied the principles of section 324A in Seay 

v. Travelers Indem. Co., 730 S.W.2d 774, 776 (Tex. App.—Dallas 1987, no writ). 

In Seay, a hospital’s maintenance employee had been working near a boiler 

when a safety release valve on the boiler malfunctioned and discharged scalding 

water onto the employee. Id. at 775. After the employee died, his wife and 

children sued an insurance company on the ground that the company had 

negligently inspected the boiler owned by its insured. Id. Although the insurance 

company argued that it did not owe a duty to the employee, the court of appeals 

disagreed, citing section 324A and stating that the insurance company had 

performed acts that had directly promoted the interests of its insured “in the 

safety of [the insured’s] boilers and thereby was undertaking to render services to 

[the insured].” Id. at 778–79; cf. Coastal Corp. v. Torres, 133 S.W.3d 776, 780–

81 (Tex. App.—Corpus Christi 2004, pet. denied) (concluding that complaints 

about a parent company’s refusal to budget expenditures for a subsidiary was 

the “antithesis of an affirmative course of action” that was required to prove the 

voluntary undertaking of a duty to provide safety to the subsidiary’s employees).

Similarly, in Shelby v. Granbury Care Ctr., Shelby, who was an employee 

of a company that provided nursing services, was injured at Granbury Care 

Center (Granbury), where the services were to be provided, after an employee of 

Granbury refused to help Shelby transfer a patient who weighed over three 
29

hundred pounds from his bed to his wheelchair. No. 10-05-00063-CV, 2006 WL 

1041993, at *1 (Tex. App.—Waco Apr. 12, 2006, pet. denied) (mem. op.). 

Shelby sued Granbury, and Granbury sought summary judgment on the ground 

that it had not owed a duty to Shelby. Id. In reversing a trial court’s decision to 

grant summary judgment for Granbury, the Waco Court of Appeals cited section 

324A and stated,

There is uncontroverted evidence that, prior to the incident in 

which Shelby was injured, Granbury employees always assisted 

Shelby in transferring patients from their beds to their wheelchairs. 

There is also evidence that it was commonly understood by 

Granbury employees that they must assist [employees of the 

company providing nursing services] in transferring patients out of 

bed. Even if Granbury ordinarily would not have had a duty to 

assist . . . employees in transferring patients, it arguably assumed 

such a duty by consistently assisting . . . employees in the past.

Id. at *4.

The evidence presented by the parties in the trial court established that

Reliance acquired the outstanding stock of Delta Steel’s direct parent company in 

early August 2008 and that through a series of mergers, Reliance eventually 

became the direct parent company of Delta Steel.18 According to Steve 

Milanoski, who is a regional safety compliance specialist with Reliance, Reliance 

audits subsidiaries’ plants “for compliance [with] the Reliance safety standards, 

 18Reliance, through one of its subsidiaries, bought all of the outstanding 

capital stock of PNA Group, Inc. for a price of over $300 million. PNA Group, 

Inc., which merged with Reliance (with Reliance surviving the merger), had 

owned Delta Steel. Reliance became Delta Steel’s immediate parent company in 

March 2011, after Little’s death. Reliance buys, sells, and distributes metal but 

does not manufacture it.
30

[which are set out in a] policy and procedures manual.” Milanoski testified in a 

deposition that Reliance expects all subsidiaries to comply with the terms of the 

manual and that Reliance also shares safety inspection forms with its 

subsidiaries. Milanoski also explained that Reliance required subsidiaries to 

“document shift[-]wise inspection” of certain equipment. In fact, Milanoski said 

that when he audits one of Reliance’s subsidiaries, the “first thing [he looks] for” 

is documented evidence of regular inspections of equipment, including cranes.

Milanoski described the audits that he conducts of subsidiaries as “oneday event[s],” explaining that he looks for documented evidence of inspections 

but, for example, relies on independent crane maintenance companies that 

subsidiaries have contracted with to actually perform the inspections. Milanoski 

stated that Reliance “insist[s] that each subsidiary contract with a crane 

inspection service”19 and expects cranes to be inspected “at least annually.” 

According to Milanoski, if a crane inspector made a recommendation that one of 

Reliance’s subsidiaries did not implement, Reliance would counsel the subsidiary 

to make “immediate plans to rectify the situation . . . or to take the crane out of 

service.” Milanoski indicated that Reliance would direct a subsidiary to take a 

crane out of operation if the crane was going to imminently fail, but he 

 19Milanoski’s testimony established that Reliance mandates its subsidiaries 

to subcontract out crane inspections because “most of [Reliance’s] subsidiaries 

aren’t large enough to keep that expertise in-house.”
31

nonetheless opined that the subsidiary is “responsible for the safe operation of 

[its] equipment.”

One of Milanoski’s primary purposes as a safety compliance specialist is to 

ensure subsidiaries’ compliance with Reliance’s policies. During audits, 

Milanoski inspects the facilities of Reliance’s subsidiaries for cleanliness and

wear and tear on equipment.

Although Milanoski stated that he has the authority to audit one of 

Reliance’s subsidiaries at any time and recognized that Reliance could have 

audited Delta Steel’s Fort Worth plant any time after August 2008, he testified 

that he had never audited the Fort Worth plant.20 Delta Steel’s Houston and San 

Antonio plants, however, were audited by Milanoski in the first quarter of 2010.

Tom Graham, who is Delta Steel’s vice president of operations and who 

has served as the company’s safety director since the 1980s, testified in a 

deposition that he trains Delta Steel’s warehouse managers, oversees monthly 

reporting of their safety meetings, inspects Delta Steel’s facilities annually, and 

leads an annual meeting of warehouse managers. Concerning his 

communication with Reliance, Graham testified that shortly after Reliance

acquired Delta Steel in 2008, Reliance sent its safety manual to Delta Steel and 

 20Milanoski’s job requires him to monitor safety compliance for sixty 

facilities owned by Reliance’s subsidiaries, four of which are owned by Delta 

Steel. Milanoski traveled to Delta Steel’s Fort Worth location after Little’s death 

to offer condolences to workers at the plant. At that time, he learned that the 

crane that Little was using when he died did not have a battery backup unit.
32

expressed that it expected Delta Steel’s safety manual to, at a minimum, contain 

everything that Reliance’s safety manual included.21 Graham explained that 

since the time of Reliance’s acquisition of Delta Steel, Delta Steel had “follow[ed] 

the bare minimum [of] Reliance[’s] safety manual.” Graham, who worked with 

Milanosky on Delta Steel’s safety-related issues, said that Reliance also required 

Delta Steel to mail monthly reports on accidents and investigations to Reliance

and that Reliance had the “right” to confront Delta Steel about safety issues.

Michael Kruse, Reliance’s director of safety and quality control,22 testified 

in a deposition that verbally and in writing, he communicates his expectation to 

Reliance’s subsidiaries that Reliance expects them to follow certain safety 

practices and to protect their workers. Kruse also confirmed, more specifically, 

that he expects Delta Steel to meet Reliance’s safety standards and that he has 

communicated that expectation to Graham. According to Kruse, Reliance’s 

subsidiaries should be run, at least as it concerns safety, just as Reliance would 

be run; Kruse testified that subsidiaries should be operated as if they had 

Reliance’s name on their “exterior signage.”

Kruse explained that when Reliance conducts a safety audit of a 

subsidiary’s facility, Reliance analyzes whether the facility is operating within 

 21Reliance allows subsidiaries to implement additional policies that are not 

inconsistent with Reliance’s policies.

22Milanoski is subordinate to Kruse; thus, Milanoski sends reports of the 

safety audits that he conducts to Kruse.
33

Reliance’s safety standards and expects that any deviation found between 

Reliance’s safety standards and the facility’s safety standards will be corrected 

by the facility. Kruse conceded that the “same rules and regulations” apply to 

Reliance and Reliance’s subsidiaries.

Kruse testified that Reliance does not monitor logs related to its 

subsidiaries’ employees, does not train equipment operators for the subsidiaries, 

does not train management of the subsidiaries about how to oversee the day-today operations of their organizations, does not generally provide forms to be 

used in training, does not require subsidiaries to provide training documentation 

for their employees, does not direct subsidiaries to choose a particular method of 

transporting steel, does not maintain files on subsidiaries’ employees, and does 

not determine subsidiaries’ equipment needs. Kruse confirmed, however, that 

Reliance requires its subsidiaries to send monthly reports to Reliance about manhours worked and work-related injuries at the subsidiaries’ plants. Also, Kruse 

testified that if Reliance made a safety recommendation that a subsidiary’s facility 

did not follow, he would discuss the matter with the subsidiary’s president, and “if 

that wasn’t sufficient, then [Kruse] would escalate” the matter.

Kruse attended a meeting of Delta Steel’s warehouse managers in 

November 2008 (shortly after Reliance acquired Delta Steel) in Houston and 

spoke to the group about several aspects of Reliance’s safety program and about 

Reliance’s safety expectations. At the meeting, Delta Steel gave Kruse a copy of 

Delta Steel’s updated manual so that Kruse would “know what [Delta Steel] had 
34

changed” in the manual. Graham has acknowledged that Kruse is his “superior” 

with regard to Delta Steel’s safety issues.

We hold that this evidence establishes that under section 324A and the 

cases cited above, Reliance voluntarily undertook the duty owed by Delta Steel 

to provide safety to Little.23 Specifically, we conclude that this duty arose 

because Reliance generally controlled aspects of Delta Steel’s safety policies

(through, among other acts, commanding the inclusion of certain provisions in 

Delta Steel’s manual); specifically controlled policies concerning the inspection of 

cranes (such as requiring Delta Steel to hire an independent inspection 

company); had the authority to audit Delta Steel’s Fort Worth plant and to require 

Delta Steel to correct safety issues discovered upon an audit; audited Delta 

Steel’s other plants; had the authority to require Delta Steel to take a 

malfunctioning crane out of service; and required Delta Steel to mail monthly 

reports on accidents and investigations to Reliance. See Restatement (Second) 

of Torts § 324A; Morris, 106 S.W.3d at 754; Abdel-Fattah, 948 S.W.2d at 385–

86; Seay, 730 S.W.2d at 778–79. In other words, we hold that Reliance 

undertook a duty under section 324A because although the evidence 

demonstrates that Reliance does not regulate all aspects of Delta Steel’s 

 23Delta Steel, as Little’s employer, had a “duty to use ordinary care in 

providing a safe work place.” Leitch v. Hornsby, 935 S.W.2d 114, 117 (Tex. 

1996).
35

business, it establishes that Reliance asserts that it has the controlling, primary

authority for maintaining safety at Delta Steel’s facilities.

For the proposition that corporate “supervision or oversight does not 

translate into an involvement of the day-to-day affairs of a subsidiary, and 

therefore fails to create an independent duty to the [subsidiary’s] employees,” 

appellees cite White v. Elcor Corp., No. 09-99-00381-CV, 2001 WL 359833 (Tex. 

App.—Beaumont Apr. 12, 2001, no pet.) (not designated for publication). That 

case is distinguishable.

In White, the parent company had the authority to compel the subsidiary to 

“adopt particular safety policies,” but there is no indication that the parent 

company actually did so. Id. at *1. The parent company’s vice president of 

administration was aware that the subsidiary had a safety policy and had read “a 

part of it,” but the vice president had “no direct responsibility or control” over the 

subsidiary’s safety procedures. Id. Finally, while the vice president “was 

authorized to discuss safety problems with [the subsidiary’s] management[,] he 

did not have authority to approve responses to those problems; that responsibility 

[remained] with [the subsidiary’s] management.” Id. at *2. Under these facts, the 

Beaumont Court of Appeals held that the parent company had not undertaken a 

duty to provide safety for the subsidiary’s employees under section 324A. Id. at 

*2–3.

Similarly, in Cleveland Regional Medical Center, L.P. v. Celtic Properties, 

L.C., which appellees also cite, the parent company was not involved in the 
36

subsidiary’s day-to-day operations, the subsidiary was responsible for 

maintenance and repairs, and the parent company “merely approved certain 

requests for capital expenditures.” 323 S.W.3d 322, 351 (Tex. App.—Beaumont 

2010, pet. denied). Thus, the court of appeals held that the parent company did 

not owe a duty with respect to the subsidiary’s premises. Id.

The facts described above concerning the relationship between Reliance 

and Delta Steel involve a much greater level of parent-company control over 

safety than the control that existed in White or in Cleveland Regional Medical 

Center, L.P.

Finally, Reliance contends that to establish a duty under section 324A, 

appellants were required to prove that Reliance “overtook the responsibilities of 

Delta Steel to perform a duty owed by Delta Steel to Little such that Delta Steel 

no longer bore the responsibility.” [Emphasis added.] But Reliance has not cited 

authority supporting such a restrictive application of section 324A(b), and we 

have not located any Texas cases supporting such an application. We conclude 

that section 324A(b) applies in this case because even if Reliance did not 

completely supplant Delta Steel’s duty to provide safety to Little, the evidence 

establishes that Reliance went beyond merely supplementing that duty because 

it assumed the primary responsibility for Delta Steel’s workplace safety. Cf. 

Miller v. Bristol-Myers Co., 168 Wis.2d 863, 886, 485 N.W.2d 31, 39 (1992)

(deciding that it would be “inequitable to provide immunity to a parent corporation 

that had assumed a duty of care to its subsidiary’s employees and whose 
37

unreasonable performance of its undertaking was a cause of the injuries, simply 

because its activities were supplemental to, rather than in lieu of, the subsidiary’s 

practices”).24

For all of these reasons, we conclude that the trial court erred by granting 

summary judgment for Reliance on appellants’ ordinary negligence claim, which 

is premised on Reliance’s voluntary undertaking of a duty.25 Accordingly, we 

sustain part of appellants’ second issue.

In the trial court, Reliance sought summary judgment on appellants’ gross 

negligence claim on two independent grounds: Reliance did not owe a duty to 

Little, and appellants could not produce more than a scintilla of evidence that 

Reliance was grossly negligent. See LaRue v. Chief Oil & Gas, L.L.C., 167 

S.W.3d 866, 879 (Tex. App.—Fort Worth 2005, no pet.) (discussing the elements 

of gross negligence). The trial court granted Reliance’s motion without specifying 

the reason for doing so. On appeal, appellants have not challenged the merits of 

Reliance’s no-evidence motion for summary judgment on appellants’ gross 

negligence claim. Thus, we must affirm the trial court’s decision to grant 

summary judgment as to that claim, and we overrule appellants’ second issue to 

 24We note that section 324A’s standards have been substantially 

incorporated into the most recent Restatement on torts. See Restatement (Third) 

of Torts: Physical & Emotional Harm § 43 (2012). A comment in the new 

Restatement states, “The actor who engages in an undertaking need not 

completely displace the person originally owing the duty.”). Id. cmt. g.

25We do not express an opinion about whether appellants may meet the 

other elements of their negligence claim against Reliance. 
38

that extent. See Collier, 64 S.W.3d at 58; Torres v. Johnson, 91 S.W.3d 905, 

908 n.3 (Tex. App.—Fort Worth 2002, no pet.) (affirming a summary judgment on 

an unchallenged ground).

Conclusion

Having overruled appellants’ first issue and part of their second issue, we 

affirm the part of the trial court’s judgment that grants summary judgment for 

Delta Steel on appellants’ ordinary negligence claim and grants summary 

judgment for Reliance on appellants’ gross negligence claim. However, having 

sustained the remaining part of appellants’ second issue, we reverse the part of 

the trial court’s judgment that grants summary judgment for Reliance on 

appellants’ negligence claim, and we remand this case to the trial court for further 

proceedings regarding that claim. 

TERRIE LIVINGSTON

CHIEF JUSTICE

PANEL: LIVINGSTON, C.J.; MCCOY and GABRIEL, JJ.

DELIVERED: July 11, 2013