June 24, 2016

This week the Texas Supreme Court issued 8 opinions and two grants. Two of these opinions are of particular interest.

In re Nationwide Mutual Insurance Co., et al - 15-0328:

In this case, the Texas Supreme Court addressed whether a contractual forum-selection clause can be waived in the absence of prejudice to the other party.

This case involved a contract containing a clause selecting Franklin County, Ohio has the proper forum for any dispute arising under the contract. Despite this provision, the Plaintiff filed suit in Travis County, Texas, and Nationwide waited two years to challenge the forum. The trial court found that Nationwide had substantially invoked the judicial process in Texas by serving answers and counterclaims, filing special exceptions and two motions to dismiss, serving written discovery, and obtaining a written protective order. Additionally, the trial court found that the Plaintiff had suffered detriment or prejudice due to the two-year delay in challenging the forum, during which time the contractual limitations period ran in Ohio. The Court of Appeals denied Nationwide's request for mandamus relief, so Nationwide filed for mandamus relief in the Texas Supreme Court.

The Texas Supreme Court conditionally granted the petition for writ of mandamus and directed the trial court to enforce the forum-selection clause finding that the Plaintiff failed to establish that the forum-selection clause was waived because the Plaintiff did not actually suffer any prejudice as a result of the delay when Nationwide voluntarily waived the limitations period.

Crosstex North Texas Pipeline L.P. v. Andrew and Shannon Gardiner - 15-0049

In this case, the Texas Supreme Court provides much needed guidance on interpreting the term "nuisance" under Texas law.

This case involved a natural-gas pipeline owned by Crosstex that ran near ranch-land owned by the Gardiner family. Once Crosstex installed a compressor station near the property, the peace and quiet of the Gardiner's ranch was shattered by the "constant roar" of the compressor. The Gardiners filed suit alleging both intentional and negligent nuisance claims. Following a jury verdict, the trial court entered judgment for the Gardiners on their negligent-nuisance claim. The Court of Appeals reversed and remanded for a new trial because the court found that the evidence was legally sufficient but not factually sufficient to support the jury's negligently created nuisance finding.

The Texas Supreme Court affirmed the judgment of the Court of Appeals, and adopted the following definition: "a 'nuisance' is a condition that substantially interferes with the use and enjoyment of land by causing unreasonable discomfort or annoyance to persons of ordinary sensibilities attempting to use and enjoy it." Additionally, with the intention of providing comprehensive guidance on nuisance, the Court clarified the following issues:

  • 'Nuisance' is not a cause of action nor does it refer to conduct by a defendant
  • Instead, 'nuisance' is "a type of legal injury involving interference with the use and enjoyment of real property"
  • To prove that there is a nuisance, "a plaintiff must establish that the effects of the substantial interference on the plaintiff are unreasonable ..."
  • Whether the effects of the interference are unreasonable is an objective standard based on an ordinary person standard
  • There are three types of conduct that may support liability for creating a nuisance: (1) intentional, (2) negligent, and (3) abnormal or out of place conduct that is abnormally dangerous and creates a high degree of risk of serious injury (strict-liability)