Court Opinion

ID: 9404789
Source: CourtListenerOpinion
Date Created: 2023-06-26 07:09:30.221816+00
Date Added: 2024-06-11T17:20:17.251178
License: Public Domain

Opinion issued June 22, 2023

                                       In The

                               Court of Appeals
                                      For The

                           First District of Texas
                            ———————————
                               NO. 01-22-00477-CV
                            ———————————
             DANIEL BRAND AND JAMES WELLS, Appellants
                                         V.
              SOJITZ CORPORATION OF AMERICA, Appellee

                    On Appeal from the 152nd District Court
                             Harris County, Texas
                      Trial Court Case No. 2018-47552-A

                          MEMORANDUM OPINION

      Appellants, Daniel Brand and James Wells (collectively, “the workers”),

challenge the trial court’s rendition of summary judgment in favor of appellee, Sojitz

Corporation of America (“SCA”), in the workers’ suit against SCA for negligence,
gross negligence, and premises liability. In their sole issue, the workers contend that

the trial court erred in granting summary judgment in favor of SCA.

      We affirm.

                                     Background

      In their first amended petition, the workers alleged that “[o]n or about May 2,

2018, [they] were working at a [p]lant” in LaPorte, Harris County, Texas (the

“Metton LaPorte plant”). On that date, “operational issues were reported” about

“equipment and ongoing operations” at the plant. But “[d]espite notice of equipment

malfunction and potential hazards,” SCA and others,1 failed to take “adequate steps

to evacuate [the workers], to minimize the potential hazards, or to adequately rectify

the situation.” Instead, the workers “and the other employees” were ordered “to

continue work.” “[A] significant explosion and fire occurred,” resulting in serious

injury to the workers. The workers “suffered injuries to their heads, arms, necks,

backs and other parts of their bodies.”        They “also suffered from emotional

disturbance as a result of their injuries, including anxiety, difficulty in focusing and

concentration, and sleep disturbance.”

1
      The workers’ first amended petition named SCA, Sojitz Energy Venture, Inc., and
      Metton America, Inc. (“Metton”) as defendants. The workers eventually nonsuited
      their claims against Sojitz Energy Venture, Inc., and Metton filed its own
      summary-judgment motion related to the workers’ claims against it, which the trial
      court denied. After the trial court granted SCA summary judgment, it severed the
      workers’ claims against SCA from the underlying suit, and the workers appealed.
                                              2
      The workers brought claims against SCA for negligence, gross negligence,

and premises liability. According to the workers, SCA had a duty to warn them of

the “dangerous conditions” at the plant; “exercise reasonable care” to guard against

“known and foreseeable hazards”; “provide a safe work environment”; protect them

“from fire and/or explosion”; “adequately train [its] employees”; “adequately

develop and implement appropriate policies and procedures”; “adequately

supervise” its personnel; “timely recognize an emergency and/or hazardous

situation”; and “provide adequate first aid and assistance.” But SCA breached those

duties and “[create]ed an unreasonably dangerous condition” that proximately

caused the workers’ injuries. Thus, the workers asserted that they were entitled to

“recover for their injuries.” And because SCA’s “actions were done with a reckless

disregard to a substantial risk of severe bodily injury,” the workers argued, they were

“entitled to exemplary damages” as well.

      As to their premises-liability claim, the workers’ alleged that SCA “owned,

occupied and/or controlled the area where [the workers] were injured,” were aware

that the “condition of the area where [the workers] were injured posed an

unreasonable risk of harm,” and “had actual knowledge or reasonably should have

known of the unreasonably dangerous condition.” The workers, though, “did not

have actual knowledge of the unreasonably dangerous condition.” The workers

argued that because they were invitees of SCA, SCA “had a duty to either warn”

                                              3
them of the “unreasonably dangerous condition” or eliminate it. But SCA breached

its duties, and its breach proximately caused the workers’ injuries.

         The workers sought damages “in excess of $1,000,000.00,” including

compensatory, actual, and consequential damages and recovery for “[p]ain and

suffering,” “[p]ast and future mental anguish,” “[p]ast and future impairment,”

“[p]ast and future disfigurement,” as well as exemplary damages.

         SCA answered, generally denying the workers’ allegations. SCA also attested

in a verified denial that “SCA d[id] not own or operate the [Metton LaPorte plant]

where the incident occurred and was not involved in the alleged events made the

basis of [the workers’] suit.” For those reasons, SCA “denie[d] that it [wa]s a proper

party” to the workers’ suit and it was not “liable in the capacity in which it [was]

sued.”

         SCA then moved for summary judgment, asserting that it was entitled to

judgment as a matter of law on the workers’ claims against it and there was no

evidence to support the workers’ negligence, gross negligence, and premises liability

claims. In its motion, SCA argued that it was entitled to judgment as a matter of law

because it was “a wholly separate company from Metton,” who was “the owner and

operator of the [Metton LaPorte plant]” where the workers were injured. SCA was

“a trading company,” and its chemical division “purchase[d] resin materials for

                                             4
liquid molding” manufactured by Metton. Thus, SCA maintained, it “ha[d] nothing

to do with the plant or the allegations in [the workers’] lawsuit.”

      SCA attached to its summary-judgment motion a copy of the deposition

testimony of its corporate representative, Tekashi Uesaka. In her deposition, Uesaka

explained that SCA bought petroleum resin from U.S. manufacturers and sold it to

its clients in Asia. According to Uesaka, SCA “invested in chemicals and traded

chemical products”; it did not manufacture resin. Metton made “raw materials for

plastic resin,” and SCA sold some of the materials made by Metton.

      According to Uesaka, SCA had a ninety-five percent investment in Metton’s

stock, and “Sojitz Europe” held the remaining five percent of Metton’s stock. But

SCA did not oversee the Metton LaPorte plant. Uesaka explained that “Metton ha[d]

[its] own operation method” and “procedures,” and SCA did not “give any opinions

or comments to [Metton]” about those functions. SCA’s role as to Metton was

limited to “manag[ing]” or “see[ing] the results of [its] performance.”

      According to SCA, because the evidence showed that it “had no involvement

in ownership or operations” of the Metton LaPorte plant, SCA did not “owe[] a duty,

breach[] any duty,” or “proximately cause[] the incident or injuries alleged by the

[workers].” SCA also argued that because it did not own or occupy the Metton

LaPorte plant, it could not be held liable under a premises-liability theory.

                                              5
      As to its no-evidence grounds, SCA asserted that the workers had no evidence

that SCA owed them a legal duty, SCA breached any duty owed to the workers, and

that any breach of a duty owed by SCA “proximately caused the accident and

injuries.” SCA also argued that the workers could not prove their premises-liability

claim against SCA because there was no evidence that “SCA was the possessor[] of

the premises,” “[a] condition of the plant posed an unreasonable risk of harm,” “SCA

knew or reasonably should have known of the danger” posed by such condition, and

SCA “fail[ed] to adequately warn” the workers of such condition or “fail[ed] to make

the condition reasonably safe.” Further, SCA maintained that there was no evidence

that any breach by SCA “proximately caused the accident and injuries.”

      In their response to SCA’s summary-judgment motion, the workers asserted

that “[a] genuine issue of material fact exist[ed] as to whether [SCA] had actual

control over the safety and security of workers at the [Metton LaPorte plant].”

According to the workers, SCA “exercised control over the safety and security of

the workers at the [Metton LaPorte plant] both generally and on . . . May 2, 2018.”

      As the they explained in their response, on May 2, 2018, the workers “were

on assignment from their employers to work as independent contractors at the

[Metton LaPorte plant].” They began their shift at 6:00 p.m. When they arrived at

the plant, a batch of “component B in Tank 510” that had been made earlier in the

day “was solidifying, which was extremely dangerous.”

                                            6
      Eventually, the component B began “coming out” of “Tank 510,” “which was

serious cause for concern.” A few Metton employees expressed concern, and two

“stated that Tank 510 ha[d] reached its max[imum] temperature.” A fourth Metton

employee called the vice president of the Metton La Porte plant, Masanori Abe, as

soon as he heard about the “problems with the tank.”

      Abe “arrived at the [Metton La Porte] plant,” “assessed the situation,” and

“concluded that . . . Tank 510 was not going to explode.” Abe then “informed

Metton staff and other workers that it was safe to go back to work.” Abe did not

order an evacuation of the plant even though he knew “the temperature” inside the

tank “was uncontrollably rising, creating a high risk that there could be an explosion

and/or fire.”

      About an hour after Abe had assured the workers that it was safe to continue

to work, Tank 510 exploded. “Brand was working on the truck loading area, which

was approximately 50 feet” from where the tank exploded. “Wells was also near the

tank . . . when the explosion occurred.” “[T]he blast knocked both [workers] off

their feet” and caused them to suffer serious injuries.

      The workers noted that SCA was Metton’s parent company and was “owned

by Sojitz Japan.” Further, “all upper management positions at Metton were assigned

from Sojitz Japan,” including that of vice president Abe. “Sojitz Japan” also

“select[ed]” the president for the Metton LaPorte plant, who was “responsible for

                                              7
ensuring the safety of workers at the plant.” Thus, according to the workers, “Sojitz,

not Metton, was in charge and control of safety” at the Metton LaPorte plant.

      The workers attached to their response a copy of the deposition testimony of

the Metton LaPorte plant’s safety manager, Gwendolyn McNeil. McNeil testified

that salaried Metton employees received an annual training from “Sojitz”2 “[o]n the

computer.” Sojitz personnel had also come to the plant for training. On one

occasion, “two employees from Sojitz New York” came to the Metton LaPorte plant

and “attended the class” about “shipment of hazardous goods” with Metton

employees Judy Johnson, the customer liaison who was also in charge of shipping,

Beau West, the manager of the Metton LaPorte plant, vice president Abe, and

McNeil. McNeil also testified that Sojitz representatives “would bring college

students” from abroad into the Metton LaPorte plant for tours, and she would “do a

safety presentation for [them].”

      As to the tank that exploded, the workers noted that McNeil acknowledged in

her deposition testimony that she did not know how often maintenance checks were

performed to ensure that the safety valves on the tanks worked properly. According

2
       “Sojitz” was defined earlier in McNeil’s deposition by the workers’ trial counsel as
      meaning a “Japanese organization” that was Metton’s “parent company.” This
      definition does not accurately refer to either “Sojitz Japan,” which is the only
      Japanese entity identified in the record, or SCA, which holds the majority of
      Metton’s stock.
                                               8
to the workers, those “valves c[ould] play a critical role in preventing the very type

of accident” that injured the workers.

      The workers also attached to their response a copy of the deposition testimony

of plant manager West, in which he stated that Sojitz bought the Metton LaPorte

plant from Jim Brown sometime before 2002. According to the workers, West

testified that “Metton did not follow its own policies and procedures or industry

standards and failed to conduct” annual hazard studies from 2014 to 2018. West

also testified that “there [wa]s no documentation showing that there was any routine

maintenance, inspection, or repair of [Tank 510’s] regulator” or “pressure release

valve.”

      The workers asserted that “Sojitz ha[d] been staffing” the “upper management

positions” at the Metton LaPorte plant “with Sojitz employees” from Japan “since

approximately 2002.” For instance, Abe was an “upper management employee

placed at the [Metton La Porte plant] by Sojitz.” According to the workers,

“[n]umerous people testified” in their depositions that “they would have not gone

back out” near Tank 510 had Abe not told them that “it was safe.” That testimony

made “clear that Sojitz, not Metton, was in charge” and in “control of safety at the

[Metton LaPorte plant], and thus [owed the workers] a duty.”

      In SCA’s reply to the workers’ response to its summary-judgment motion,

SCA reiterated that it “had no involvement” in Metton’s “operations” and “did not

                                             9
occupy the premises” of the Metton LaPorte plant. SCA was “a wholly separate

company” from Metton. SCA emphasized that “Texas law presumes that two

separate companies are . . . distinct legal entities,” so “related companies in a

corporate hierarchy cannot be treated as the same entity for liability purposes.” For

this reason, whether “Metton’s upper management positions were assigned from

Sojitz Japan” was “irrelevant” because those individuals were nonetheless “Metton

employees.” Such an “administrative act or decision by a parent company ha[d] no

bearing” on the workers’ claims against SCA. Thus, SCA asserted, there was “[n]o

basis to attribute the actions of Abe,” a Metton employee, to “impose liability on

SCA under a negligent undertaking theory of liability.”

      SCA further observed that the sole exception to the rule that “parent

corporations generally have no duty to control their subsidiaries . . . involves an

undertaking by the parent company which directly promotes the interests of the

subsidiary in providing a safe workplace.” But because SCA “d[id] not oversee the

operations at the Metton [LaPorte plant],” “the evidence presented by SCA show[ed]

that there [wa]s no genuine issue of material fact on th[at] issue.”

      SCA also noted that the workers did not allege the elements of a

negligent-undertaking claim in their live pleading. And “[e]ven if” the workers had

“timely alleged” a negligent-undertaking claim, proof of their “cause of action would

still require evidence that SCA undertook some action relevant to [the workers’]

                                             10
broader issues of plant safety.” But according to SCA, there was “no support for the

conclusion that SCA was . . . involved in the safety of the Metton [LaPorte plant].”

      The trial court granted SCA summary judgment motion on the workers’

negligence, gross negligence, and premises-liability claims against it, and SCA

moved to sever the workers’ claims against it from those the workers had brought

against Metton.       The trial court granted the severance, making the summary

judgment final.

                                Standard of Review

      We review a trial court’s decision to grant summary judgment de novo.

Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005); Provident Life

& Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003). In conducting our

review, we take as true all evidence favorable to the non-movants, and we indulge

every reasonable inference and resolve any doubts in the non-movants’ favor.

Valence Operating, 164 S.W.3d at 661; Knott, 128 S.W.3d at 215. When, as here,

the trial court does not specify the grounds on which it granted summary judgment,

we must affirm if any of the summary-judgment grounds are meritorious. See

Beverick v. Koch Power, Inc., 186 S.W.3d 145, 148 (Tex. App.—Houston [1st Dist.]

2005, pet. denied).

      To prevail on a no-evidence summary-judgment motion, the movant must

establish that there is no evidence to support an essential element of the

                                            11
non-movants’ claim on which the non-movants would have the burden of proof at

trial. See TEX. R. CIV. P. 166a(i); Fort Worth Osteopathic Hosp., Inc. v. Reese, 148

S.W.3d 94, 99 (Tex. 2004); Hahn v. Love, 321 S.W.3d 517, 523–24 (Tex. App.—

Houston [1st Dist.] 2009, pet. denied). The burden then shifts to the non-movants

to present evidence raising a genuine issue of material fact as to each of the elements

challenged in the motion. Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 582 (Tex.

2006); Hahn, 321 S.W.3d at 524. A no-evidence summary judgment may not be

granted if the non-movants bring forth more than a scintilla of evidence to raise a

genuine issue of material fact on the challenged elements. See Ford Motor Co. v.

Ridgway, 135 S.W.3d 598, 600 (Tex. 2004). More than a scintilla of evidence exists

when the evidence “rises to a level that would enable reasonable and fair-minded

people to differ in their conclusions.” Merrell Dow Pharm., Inc. v. Havner, 953

S.W.2d 706, 711 (Tex. 1997) (internal quotations omitted). The trial court must

grant a no-evidence summary-judgment motion if the movant asserts that there is no

evidence of one or more specified elements of the non-movants’ claim on which the

non-movants would have the burden of proof at trial and the non-movants fail to file

a timely response or fail to produce summary-judgment evidence raising a genuine

issue of material fact on each challenged element. See TEX. R. CIV. P. 166a(i);

Lockett v. HB Zachry Co., 285 S.W.3d 63, 67 (Tex. App.—Houston [1st Dist.] 2009,

no pet.).

                                             12
      To prevail on a matter-of-law summary-judgment motion, a movant has the

burden of establishing that there is no genuine issue of material fact and it is entitled

to judgment as a matter of law. TEX. R. CIV. P. 166a(c); Cathey v. Booth, 900 S.W.2d

339, 341 (Tex. 1995). When a defendant moves for summary judgment on the

plaintiffs’ claim, it must either (1) disprove at least one essential element of the

plaintiffs’ cause of action or (2) plead and conclusively establish each essential

element of its affirmative defense, thereby defeating the plaintiffs’ cause of action.

Cathey, 900 S.W.2d at 341; Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197

(Tex. 1995). Once the movant meets its burden, the burden shifts to the non-movants

to raise a genuine issue of material fact precluding summary judgment. See Siegler,

899 S.W.2d at 197; Transcont’l Ins. Co. v. Briggs Equip. Tr., 321 S.W.3d 685, 691

(Tex. App.—Houston [14th Dist.] 2010, no pet.). The evidence raises a genuine issue

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

of all of the summary-judgment evidence. Goodyear Tire & Rubber Co. v. Mayes,

236 S.W.3d 754, 755 (Tex. 2007).

                               Negligent Undertaking

      In their sole issue, the workers argue that the trial court erred in granting

summary judgment in favor of SCA on their negligence, gross negligence, and

premises-liability claims because they raised a genuine issue of material fact as to

                                              13
whether SCA assumed a duty of care to the workers by voluntarily undertaking the

responsibility of providing the Metton LaPorte plant with safety training.

       One who voluntarily undertakes an affirmative course of action for the benefit

of another has a duty to exercise reasonable care that the other’s person or property

will not be injured by the undertaking. Colonial Sav. Ass’n v. Taylor, 544 S.W.2d

116, 119–20 (Tex. 1976); Torres v. Pasadena Ref. Sys., Inc., No.

01-18-00638-CV, --- S.W.3d --- , 2022 WL 17684333, at *13 (Tex. App.—Houston

[1st Dist.] 2022, no pet.). To establish a negligent undertaking, the plaintiffs must

show that: (1) the defendant undertook to perform services that it knew or should

have known were necessary for the plaintiffs’ protection; (2) the defendant failed to

exercise reasonable care in performing those services; and (3) either (a) the plaintiffs

suffered harm because of their reliance on the defendant’s performance or (b) the

defendant’s failure to exercise such care increased the plaintiffs’ risk of harm. Nall

v. Plunkett, 404 S.W.3d 552, 555–56 (Tex. 2013); Torres, 2022 WL 17684333, at

*13.

       To satisfy the duty element of a negligent-undertaking claim, the workers

were required to present evidence raising a fact issue about whether SCA acted in a

way that required the imposition of a duty where one otherwise would not exist. See

Nall, 404 S.W.3d at 555; Torres, 2022 WL 17684333, at *13; see also Bauer v.

Gulshan Enters., Inc., 617 S.W.3d 1, 21 (Tex. App.—Houston [1st Dist.] 2020, pet.

                                              14
denied) (recognizing absent special relationship or circumstances, Texas law

generally imposes no duty to take action to prevent harm to others).

      The workers first assert that safety manager McNeil’s deposition testimony

that Sojitz3 provided annual online training and a class about “shipment of hazardous

goods” for salaried employees of the Metton LaPorte plant raises a fact issue about

whether SCA assumed a duty to provide the Metton LaPorte plant with safety

training. Cases that have extended liability to a parent corporation for injuries to its

subsidiary’s employees based on an affirmative undertaking theory have “involved

incidents where the parent corporation had engaged in an undertaking which directly

promoted the interests of its subsidiary in providing a safe workplace.”

Abdel-Fattah v. Pepsico, Inc., 948 S.W.2d 381, 385 (Tex. App.—Houston [14th

Dist.] 1997, no writ); see also Coastal Corp. v. Torres, 133 S.W.3d 776, 780–81

(Tex. App.—Corpus Christi–Edinburg 2004, pet. denied) (parent company’s refusal

to budget funds allegedly necessary for maintaining safety of refinery did not

constitute affirmative undertaking to control “safety duty” that refinery owed its

employees); Seay v. Travelers Indem. Co., 730 S.W.2d 774, 775, 780 (Tex. App.—

Dallas 1987, no writ) (fact issue existed as to whether insurance company that had

3
      As noted previously, “Sojitz” was defined earlier in McNeil’s deposition by the
      workers’ trial counsel as meaning a “Japanese organization” that was Metton’s
      “parent company.” This definition does not accurately refer to either “Sojitz Japan,”
      which is the only Japanese entity identified in the record, or SCA, which holds the
      majority of Metton’s stock.
                                               15
performed acts directly promoting insured’s interest in safety of its boilers had duty

to insured’s employee, who was killed when boiler malfunctioned).

      Here, Sojitz’s training at the Metton LaPorte plant for shipment of hazardous

goods—a subject that for SCA, as a buyer and seller of resins, is within its

wheelhouse—is not the same as safety training for operating a resin manufacturing

plant. As to the Metton LaPorte plant operations, SCA’s corporate representative

Uesaka testified that “Metton ha[d] [its] own operation method” and “procedures,”

and SCA did not “give” Metton “any opinions or comments” about how Metton

operated its LaPorte plant. Uesaka’s testimony on this issue was uncontroverted.

Thus, McNeil’s testimony about classes for “shipment of hazardous goods” and

other unspecified classes does not raise a fact issue as to whether SCA assumed a

duty to provide the Metton LaPorte plant and its workers with safety training for

plant operations. See Nall, 404 S.W.3d at 555; Torrington Co., 46 S.W.3d at 838–

39.

      The workers also argue that they raised a fact issue as to whether SCA

undertook a duty to provide the workers with a safe working environment because

Abe, who made the decision not to evacuate the Metton LaPorte plant on May 2,

2018, was assigned by “Sojitz Japan” to serve as the plant’s vice president. But no

evidence ties Sojitz Japan’s assignment of the Metton LaPorte plant’s upper

management to any conduct of SCA, and the mere fact that a corporation may be a

                                             16
subsidiary does not automatically render it liable for the actions or obligations of its

parent. On the contrary, because Texas law presumes that even related corporations

are separate entities, “[t]he party seeking to ascribe one corporation’s actions to

another by disregarding their distinct corporate entities must prove this allegation.”

BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 798 (Tex. 2002); see also

SSP Partners v. Gladstrong Invs. (USA) Corp., 275 S.W.3d 444, 455 (Tex. 2008)

(“We have never held corporations liable for each other’s obligations merely

because of centralized control, mutual purposes, and shared finances. There must

also be evidence of abuse . . . .”).

      For example, in Abdel-Fattah v. PepsiCo, Inc., the plaintiff—an employee of

PepsiCo’s wholly-owned subsidiary, Taco Bell—alleged that in hiring the chief

executive officer (“CEO”) and president of Taco Bell, PepsiCo undertook an

affirmative act that created a duty to use reasonable care in hiring Taco Bell’s

employees. 948 S.W.2d 381, 383, 385 (Tex. App.—Houston [14th Dist.] 1997, no

writ). According to the plaintiff, PepsiCo was negligent in hiring Taco Bell’s CEO

and president, and thus was liable for injuries inflicted on the plaintiff by a Taco Bell

employee who had been negligently hired during the CEO and president’s tenure.

Id. at 385.

      Our sister appellate court acknowledged that the hiring of Taco Bell’s CEO

and president could be considered as an affirmative undertaking by PepsiCo for Taco

                                              17
Bell’s benefit. Id. But because the hiring of an executive was not an undertaking

that directly promoted Taco Bell’s interest in providing a safe workplace, the court

concluded that it was not “an undertaking that would justify extending a legal duty

on the part of PepsiCo to oversee the daily management” of Taco Bell’s employees.

Id. Thus, the court held that there was no basis for imposing a legal duty on PepsiCo

to protect the plaintiff from an injury inflicted by a fellow Taco Bell employee. Id.;

see also Ross Stores, Inc. v. Miller, 612 S.W.3d 682, 690–91 (Tex. App.—Houston

[1st Dist.] 2020, no pet.) (absent showing of direct participation by parent company

in circumstances precipitating injury to employee of subsidiary, there was no basis

for concluding that parent company was required to protect subsidiary’s employee).

Similarly, here, Sojitz Japan’s selection of upper management, including Abe, for

the Metton LaPorte plant is no evidence that SCA exercised any control over the

Metton LaPorte plant’s operations or voluntarily undertook a duty to ensure that the

plant operated safely.

      Because there is no evidence that SCA owed the workers a duty of care, we

hold that the trial court did not err in granting summary judgment in favor of SCA

on the workers’ claims against it.

      We overrule the workers’ sole issue.

                                             18
                                    Conclusion

      We affirm the order of the trial court.

                                                Julie Countiss
                                                Justice

Panel consists of Chief Justice Adams and Justices Countiss and Rivas-Molloy.

                                            19