This morning the Texas Supreme Court issued its opinion in U-Haul International, Inc. et al v. Waldrip (No. 10-0781). TCJL filed an amicus brief in support of U-Haul’s petition for review in this case. Our brief focused primarily on the insufficiency of the evidence of gross negligence underpinning an award of more than $11 million in punitive damages against U-Haul. TCJL argued that the Court of Appeals erred when it found that Waldrip met its burden to prove by clear and convincing evidence that U-Haul was grossly negligent in hiring an employee with no prior experience. TCJL expressed concern that the standard of review used by the court of appeals in this particular case would vitiate the gross negligence standard adopted by the Supreme Court in its 1995 Moriel decision and later codified by the Legislature in Chapter 41, CPRC.
Speaking for an 8-1 majority, Justice Wainwright wrote:
“Further, we are concerned about the impact the court of appeals’ reasoning may have on future gross-negligence cases involving alleged reckless hiring. Under the court of appeals’ reasoning, any time an employer hires a previously inexperienced employee requiring training in specific safety tasks, the employer conceivably may be found grossly negligent and subject to punitive damages if the employee acts negligently in performing her tasks. However, a party cannot be liable for gross negligence when it actually and subjectively believes that circumstances pose no risk to the injured party, even if they are wrong.”
TCJL applauds the Texas Supreme Court for its well-reasoned and thorough exposition of the law in this area.