Court Opinion

ID: 9643159
Source: CourtListenerOpinion
Date Created: 2023-08-22 20:21:02.637612+00
Date Added: 2024-06-11T18:10:57.057723
License: Public Domain

Justice GAM MAGE,
dissenting.
The dispositive issue in this case is whether a material fact issue was raised that the condominium complex majority owner’s proxy holder had effective control over the complex’s board-directed security measures to such an extent that it can be held liable for the alleged negligence in security decisions made. Because I agree with the court of appeals that the plaintiffs summary judgment evidence raised a fact issue regarding actual control, I dissent.
In analyzing the elements of a negligence cause of action, the first inquiry is whether the defendant owed a duty to the plaintiff. Graff v. Beard, 858 S.W.2d 918, 919 (Tex. 1993). As the court of appeals noted, duty is generally “a question of law for the court to decide from the undisputed facts surrounding the occurrence in question.” 874 S.W.2d at 308 (quoting Otis Eng’g Corp. v. Clark, 668 S.W.2d 307, 312 (Tex.1983)) (emphasis added). When facts are in dispute, however, the question of duty becomes one of fact for the fact finder. Bennett v. Span Industries, Inc., 628 S.W.2d 470, 474 (Tex.App. — Texar-kana 1981, writ refd n.r.e.).
Although a party generally has no duty to protect against the criminal acts of third parties who do not act under the party’s supervision or control, El Chico Corp. v. Poole, 732 S.W.2d 306, 313 (Tex.1987), such parties sometimes may be held liable if the criminal act occurs on their premises. See, e.g., Nixon v. Mr. Property Management, 690 S.W.2d 546, 550; Walkoviak v. Hilton Hotels Corp., 580 S.W.2d 623, 625 (Tex.Civ. App. — Houston [14th Dist.] 1979, writ refd n.r.e.); Morris v. Barnette, 553 S.W.2d 648, 649-50 (Tex.Civ.App. — Texarkana 1977, writ refd n.r.e.). The theory underlying these cases is that a party who has the power or right of control over a premises has a duty to provide protection against the foreseeable criminal acts of third persons on the premis*200es. Exxon Corp. v. Tidwell, 867 S.W.2d 19, 21 (Tex.1993); Morris, 553 S.W.2d at 649; LaFlewr v. Astrodome-Astrohall Stadium, 751 S.W.2d 563 (Tex.App. — Houston [1st Dist.] 1988, no writ). “[W]hen the facts are disputed, the issue of control is one of fact that must be decided by the trier of fact.” Greater Houston Transp. Co. v. Phillips, 801 S.W.2d 523, 526 (Tex.1990) (citations omitted).
To support its summary judgment motion, Centeq offered the affidavit of Carla Van Over, Centeq’s president and member of the Warwick Council, stating that Centeq had no relationship with and did not own, control or manage Warwick Towers. Siegler’s summary judgment evidence consisted of an affidavit from a person purporting to have personal knowledge of material facts, Donna Green. Green attested that Centeq acted as an agent of the majority homeowner of Warwick Towers, controlled the votes on the Warwick Council which controlled site security, and held itself out to be the agent or representative of Warwick Towers through advertisements, phone listings, and by maintaining an office in Warwick Towers. Because these facts are in dispute, the question of duty is one of fact, making the case inappropriate for disposition through summary judgment.
Petitioner Centeq maintains that Dutcher v. Owens, 647 S.W.2d 948 (Tex.1983), is dis-positive on the liability of a condominium co-owner for injuries sustained in the “common areas” of the complex. Dutcher, however, is distinguishable from this case. First, the condominium co-owner in Dutcher stipulated to liability. “[T]he sole issue for determination on appeal was whether a condominium co-owner is jointly and severally liable or is liable only for a pro rata portion of the damages.” Dutcher, 647 S.W.2d at 949. No party has admitted liability in this case. Second, this Court acknowledged in Dutcher that “[gjiven the uniqueness of the type of ownership involved in condominiums, the onus of liability for injuries arising from the management of condominium projects should reflect the degree of control exercised by the defendants.” Id. at 950. We declined to find liability in the co-owner in Dutcher based upon the reasoning in a similar California case, White v. Cox, 17 Cal.App.3d 824, 95 CaLRptr. 259 (1971). We agreed with the court in White, when it held that “to rule that a condominium co-owner had any effective control over the operation of the common areas would be to sacrifice ‘reality to theoretical formalism,’ for in fact a co-owner has no more control over operations than he would have as a stockholder in a corporation which owned and operated the project.” White, 95 CaLRptr. at 263. Here, however, unlike the co-owner in Dutcher, co-owner United Savings owned a majority interest in Warwick Towers and purportedly did exercise control over site operations and security with its majority vote. United Savings gave the power to vote its controlling interest in Warwick Towers to Centeq Realty, vesting de facto control of Warwick Towers and the Warwick Council in Centeq.
If a party with the “power of control or expulsion ... by reason of location, mode of doing business, or observation or past experiences should reasonably anticipate criminal conduct on the part of third persons ... [that party] has a duty to take precautions against it.” Exxon Corp., 867 S.W.2d at 21; see also Moody v. Cawdrey & Assoc., Inc., 6 Haw. App. 355, 721 P.2d 708, 713 (1986) (relying on White v. Cox). The party with control of security measures and other matters relating to Warwick Towers is Warwick Council. If the summary judgment evidence indicates that the Council is effectively controlled by Centeq, as the agent of the majority homeowner with the power to select a majority of the Warwick directors, Centeq has potential control over the directors and their votes on association matters such as security. The fact issue to be decided is whether or not Centeq exercised that control to influence security measures.
If Warwick Council, as a board of independent co-owners, could not exercise its independent judgment because the majority of directors were selected by one entity, the Council was not exercising its own judgment but that of the controlling entity. Under such circumstances the controlling entity should be liable for the Council’s actions which it controlled, much as the shareholders *201of a close corporation who have a controlling vote can be held personally liable. See Tex. Close CoRP.Law, Tex.Bus.CoRp. Act art. 12.37(c); Exxon Corp., 867 S.W.2d at 21.
The majority notes that this Court also recognizes the “alter ego” theory for disregarding the corporate fiction, but refuses to apply it in this case.
Alter ego applies when there is such unity between corporation and individual that the separateness of the corporation has ceased and holding only the corporation liable would result in injustice. First Nat’l Bank in Canyon v. Gamble, 134 Tex. 112, 132 S.W.2d 100, 103 (1939). It is shown from the total dealings of the corporation and the individual, including the degree to which corporate formalities have been followed and corporate and individual property have been kept separately, the amount of financial interest, ownership and control the individual maintains over the corporation, and whether the corporation has been used for personal purposes, (citations omitted) (emphasis added).
Castleberry v. Branscum, 721 S.W.2d 270, 272 (Tex.1986). The “alter ego” doctrine was created as an equitable, fact-specific approach. When adherence to the corporate fiction creates an inequitable result, courts will disregard the corporate fiction. Before we can address the equity issue, we must determine if Centeq had control over the Council. Whether the relationship between Centeq and the Council satisfies the test for “alter ego” is a fact question to be submitted to the jury. Id. at 273; Airflow Houston, Inc. v. Theriot, 849 S.W.2d 928 (Tex.App.— Houston [1st Dist.] 1993, no writ); Gensco, Inc. v. Canco Equip., Inc., 737 S.W.2d 345 (Tex.App. — Amarillo 1987, no writ). The existence of this material fact issue also makes this case inappropriate for disposition by summary judgment.
Upon viewing the evidence in the light most favorable to the nonmovant, I believe that a fact issue exists whether Centeq, which had the majority votes for directors, exercised control over those directors and influenced their votes on security measures. For these reasons, I would affirm the court of appeals and remand the cause to trial.