After such a long July 4th weekend with the family, we are left wondering why there are no father-in-law jokes.
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CHAMBERLAIN♦McHANEY SCORES MAJOR VICTORY IN LANDMARK CASE BEFORE TEXAS SUPREME COURT: LAST WEEK, in a case tried and appealed by CHAMBERLAIN♦McHANEY, the Texas Supreme Court redefined the law governing business and property owners’ liability for the allegedly negligent and grossly negligent acts of independent contractors.
Our client, Fifth Club, Inc., operates an Austin nightclub known as Club Rodeo. Fifth Club hired David West, a state certified peace officer, as an independent contractor to provide security at the club. Late one night, Roberto Ramirez arrived at Club Rodeo after…let’s just say… several hours of drinking elsewhere. Ramirez tried to enter the club but was denied admission because he was intoxicated. The doorman signaled to West and another security guard to escort Ramirez outside. West allegedly grabbed Ramirez and slammed him into a concrete wall, knocking him unconscious and fracturing his skull. The police arrived and arrested Ramirez, but the grand jury later declined to indict him. Ramirez then sued the Club and West for several hundred thousands of dollars in damages.
After a two week trial, the jury found Fifth Club vicariously liable for West’s conduct and for negligence and gross negligence in its hiring of West. The Austin Court of Appeals affirmed. We appealed to the Texas Supreme Court.
The Texas Supreme Court reversed and rendered a take-nothing judgment in favor of Fifth Club. First, the Supremes found there was no evidence to support the jury’s finding that the Club exercised any control over West. Generally, a business or property owner has no duty to ensure that an independent contractor performs his work in a safe manner unless some control is retained over the manner in which the contractor performs the work. Business and property owners can direct when and where an independent contractor does the work and can make recommendations which need not necessarily be followed, but the business or property owner may become liable for the independent contractor’s tortious acts only if he controls the details or methods of the independent contractor’s work to such an extent that the contractor cannot perform the work as he chooses. The Supreme Court found that there was no evidence the Club gave more than general directions to West. Said the court: “Fifth Club’s action in directing West to remove Ramirez from the premises did not rise to the level of directing how the work was to be performed or directing the safety of the performance because West retained the right to remove Ramirez by whatever methods he chose.”
Ramirez also argued that even if the Club did not retain control over West’s actions, it can still be held vicariously liable because of a “personal character exception” to the general rule against a business or property owners’ liability for the acts of independent contractors. Because of the “personal character” of duties owed to the public, businesses and property owners cannot, by contracting with an independent security guard, avoid liability for the intentional torts of the security guard. This exception has been previously recognized as Texas law in at least two appellate cases. See Dupree v Piggly Wiggly (Tex- App.-Corpus Christi 1976, writ ref’d n.r.e.) (the Dupree court adopted the “personal character” exception so that a company could not “subject its patrons to the hazards of an irresponsible detective agency while itself escaping the risks of liability”) and Duran v Furr’s Supermarkets, Inc (Tex. App.-El Paso 1996, writ denied).
The Supreme Court rejected Ramirez’ argument, stating: “We decline to recognize a personal character exception to the rule that an employer is generally insulated from liability for the tortious acts of independent contractors.” The court also specifically overruled the Dupree and Duran cases, thereby redefining Texas law.
We argued that there was also insufficient evidence to support the jury’s finding that the Club was negligent and grossly negligent in hiring West. The Supreme Court agreed with us, reasoning that: “While Ramirez presented evidence that Fifth Club did not perform a background check or train West, West’s status as a certified peace officer made him fit for this type of work and there was no conflicting evidence that he was unfit for the security position prior to the incident in question.” The Supreme Court held: “Because there is no evidence to show that Fifth Club’s alleged negligence in hiring West could have caused Ramirez’ injury, we reverse the court of appeals’ judgment against Fifth Club on the negligence and malice issues and render a take-nothing judgment in favor of Fifth Club.” Fifth Club, Inc v Ramirez (Tex. 2006).
OUR TAKE: While the trial judge and the lower appellate court tried to apply what they felt was existing Texas law, it was clear to us all along that they did not fully appreciate the modern trend in this area of the law. It is now clear from this Texas Supreme Court opinion that business and property owners will generally not be liable for the tortious acts of independent contractors unless they exert control over the very acts that cause the injuries or damage. And by abolishing the personal character exception to the rule, business and property owners can now contract for security services with independent security guards without the risk of assuming liability for their activities, even intentional torts. We think this case will also make it much more difficult for plaintiffs to successfully assert a negligent hiring theory against a business and property owner if the security guard is a state certified peace officer.
David Chamberlain, Tim Poteet and Amy Welborn handled this case for the firm. CHAMBERLAIN♦McHANEY handles trials and appeals throughout the State of Texas.
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We will review this case and other important 2006 cases at our full day, fully accredited, 12th ANNUAL ULTIMATE CLAIMS HANDLING SEMINAR on October 6, 2006 in Dallas, Texas. Star Jones missed last year’s seminar and you know what happened to her. Don’t you be next. Registration materials will be available in August.