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Jones v. Texaco, Inc.

ELR Citation: 27 ELR 20517
Nos. H-96cv0015, 945 F. Supp. 1037/(S.D. Tex., 11/13/1996)

The court holds that the owners of a contaminated site may not recover damages for negligence, gross negligence, or strict liability from an oil company that previously owned the site and used it to dispose of oil-field waste. The court first holds that Texas' two-year statute of limitations for property-damage suits bars the owners' claims. Although in this case, the injury occurred when the oil company still owned the site, a cause of action does not accrue until facts come into existence that authorize the claimant to seek a judicial remedy. Assuming the owners had a cause of action for damage to the land, they could have sought relief when they acquired the property in 1985. Therefore, in the absence of an exception, limitations on their claims expired, at the latest, in 1987, nine years before they brought suit. The court holds that the "discovery rule" exception to the general rule of accrual of a cause of action does not apply. When, as in this case, the information concerning the injury is contained in public records, especially records that the plaintiffs or their representatives would have reason to review (i.e., deed records in the chain of title of the property they purchased), the injury cannot be regarded as "inherently undiscoverable."

The court further holds that the owners' claims fail on the merits. Under applicable Texas precedent, the Restatement (Second) of Torts, and the doctrine of caveat emptor, the oil company owned no duty to the original purchaser for dangerous conditions on the land. To impose a duty on the oil company to remote, subsequent purchasers who acquired the land 16 years after it had already passed through several other owners, is unwarranted. The court therefore holds that summary judgment is proper as to the owners' negligence claims. Further, the owners' gross negligence claim is without merit. Even if a duty existed, the owners are unable to show the required conscious indifference on the part of the oil company to their rights, safety, or welfare, as the oil company was not even aware of their existence at the time it engaged in the activities in dispute. Finally, the court holds that the oil company is not strictly liable for the use of its own property as a facility for the disposal of hazardous substances and wastes. Texas courts, when confronted with the opportunity to apply strict liability for ultrahazardous activities, have declined to do so and have consistently required some other showing, such as negligence or trespass, for recovery. And even if Texas law recognized the doctrine of abnormally dangerous activities as a basis for strict liability, the owners' claims do not fall within the parameters of such liability, as they do not entail injury to the property of another.

Counsel for Plaintiffs
Dennis C. Reich
Reich & Binstock
4265 San Felipe, Ste. 1000, Houston TX 77027
(713) 622-7271

Counsel for Defendant
Robert W. Jones
Thompson & Knight
1700 Pacific Ave., Ste. 3300, Dallas TX 75201
(214) 969-1700