A unanimous Eleventh Court of Appeals has affirmed a trial court’s take-nothing judgment against a cattle owner who alleged that the operator was liable under premises liability and negligent entrustment theories for injuries to his cattle. In Tim Foote and Keith Cypert v. Texcel Exploration, Inc. and Tommy Decker (No. 11-20-00028-CV), Foote’s livestock, managed by Cypert, pastured on land owned by a third party in Knox County and under lease to Foote. The mineral lessee/operator, Texcel, had a producing well on the lease, which was surrounded by a single-wire electrified fence. When Cypert turned out Foote’s cattle onto the property, they began to knock down the fence. The operator’s employee made repeated attempts to repair the fence and shoo away the cattle, but the cattle kept tearing down the fence and getting into the production area. Eventually, the cattle broke a PVC pipe on a tank containing oil and saltwater, which leaked into the area and beyond the perimeter of the fence. About 132 head of cattle ultimately died from the ingestion of oil and saltwater. After the accident and before the operator could construct a new fence, Cypert constructed and paid for new fencing, for which the operator declined to pay. Foote and Cypert sued the operator and its employee for damages, including veterinary bills, special feed, shipping cost to relocate cattle, and lost profits from the sale of the underweight cattle that survived. Cypert further sought recovery of the cost of constructing the new fence.
The jury returned a verdict in favor of the operator, finding that the cattle were not “licensees” on the property. Based on the verdict, the trial court entered a take-nothing judgment. The tiral court further denied Foote and Cypert’s motion for new trial based on juror misconduct. Foote and Cypert appealed, alleging error in the jury charge and an abuse of discretion in denying their motion for new trial. The court of appeals affirmed.
In its analysis, the court of appeals began with well-settled Texas law that an owner/lessee of the surface estate may only recover against a mineral lessee or operator for injury to cattle if they plead, prove, or obtain a jury finding that: (1) the lessee/operator intentionally, wilfully, or wantonly injured the cattle; or (2) the lessee/operator used more land than was reasonably necessary for carrying out the purposes of his lease and that as a result of some negligent act or omission on his part, he proximately caused an injury to the surface owner/lessee’s cattle. As the court of appeals notes, Foote and Cypert did not seek or obtain a jury finding on either issue. Instead, they sought to expand the operator’s liability by characterizing the cattle as “invitees” on the property under a premises liability theory. They thus alleged that the trial court erred by submitting the question to the jury of whether the cattle were “licensees” and thus subject to a lesser duty of care. Foote and Cypert maintained that because the cattle were on the property for the mutual benefit of the lessee and owner, they were invitees on the entire premises as a matter of law, including the area of active oil and gas operations. They further argued that the saltwater and oil escaped the fenced area and spilled onto the property.
The court of appeals saw through this argument. First, premises liability applies to persons, and no authority exists in Texas equating persons and livestock for that purpose. Second, SCOTX authority holds that absent a lease provision to the contrary, an operator’s only duty to an owner or lessee pasturing cattle is to avoid injuring the cattle intentionally, willfully, or wantonly. Under this rule, cattle and other domestic animals resemble “trespassers upon the legitimate area of operations of the driller or producer.” As such, the owner’s only duty is to refrain from intentional, willful, or wanton injury. Undoubtedly recognizing that the evidence in this case did not support a finding of intentional, willful, or wanton injury, Foote and Cybert attempted an end run around the general rule. They further maintained that the cattle were injured outside of the fenced area, “where they were indisputably invitees.” Again, the court of appeals knocked down this argument, reiternating that the operator has no duty to fence, and (by the way) the trespassing cattle caused the leak. The court further held that Foote and Cybert sought no finding that the operator used more land than reasonably necessary to his operations and was negligent in a way that proximately caused the cattle’s injuries.
In a second issue, Foote and Cypert argued that the jury’s finding that the cattle were not licensees was against the great weight and preponderance of the evidence. In other words, they contended that if the cattle were not invitees, they had to be licensees. The court of appeals rejected this reasoning. “As set out above, cattle that invade an area of oil and gas operations, if anything, are trespassers,” the court opined. “The jury essentially determined that the cattle were trespassers on Texcel’s property by answering “No” to” the licensee question. In response to Foote and Cypert’s claim that Texcel failed to warn against the dangers of the fence, the court of appeals reminded them that an owner has no duty to warn a trespasser against open and obvious dangers.
In a third issue, the court of appeals disposed of Foote and Cypert’s negligent undertaking theory, which they based on the operator’s failure to maintain the fence. Here the court once more found no duty, and that even if the operator decides to build a fence, that does not create a duty to fence off the area. Even if such a duty existed, the court of appeals noted, the fence itself did not harm to the cattle. The negligent undertaking theory went down in flames. In three other issues, the court found that: (1) the operator’s employee acted in the course and scope of employment and was properly omitted from the jury charge; (2) there was no stipulation that the operator would reimburse Cypert for the cost of building the fence; and (3) there was no juror misconduct and, even if there was, it would not have changed the outcome.
This case is notable for a couple of reasons. First, a Knox County jury was not fooled, nor was the trial court. One only wonders if given the evidence in the case and the state of the law, summary judgment might have been appropriate. Second, the court of appeals did not buy into expanding the law to make an operator liable under a premises liability theory. It is not clear that all courts of appeals would have done the same.