NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA, AND INDUSTRIAL RISK INSURERS v. JOHN ZINK COMPANY; FISHER CONTROLS COMPANY, INC.; FISHER CONTROLS INTERNATIONAL, INC.; FISHER CONTROLS INSTALLATON AND SERVICE COMPANY; AND VALTEK, INC.--Appeal from 117th District Court of Nueces County

NUMBER 13-02-446-CV

COURT OF APPEALS

THIRTEENTH DISTRICT OF TEXAS

CORPUS CHRISTI EDINBURG

NATIONAL UNION FIRE INSURANCE COMPANY

OF PITTSBURGH PA, AND INDUSTRIAL

RISK INSURERS, Appellants,

v.

JOHN ZINK COMPANY; FISHER CONTROLS COMPANY,

INC.; FISHER CONTROLS INTERNATIONAL, INC.;

FISHER CONTROLS INSTALLATION AND SERVICE

COMPANY; AND VALTEK, INC., Appellees.

On appeal from the 117th District Court

of Nueces County, Texas.

MEMORANDUM OPINION

Before Chief Justice Valdez and Justices Rodriguez and Garza

Opinion by Chief Justice Valdez

Appellants, National Union Fire Insurance Company of Pittsburgh, PA. and Industrial Risk Insurers ( IRI ), appeal from the judgment of the trial court granting summary judgment in favor of appellees, John Zink Company ( Zink ), Fisher Controls Company, Inc., Fisher Controls International, Inc., Fisher Controls Installation and Service Company (collectively Fisher ), and Valtek, Inc. Because the trial court granted more relief than was requested, and because a genuine issue of material fact remains unresolved, we reverse and remand.

Background

The underlying dispute in this case involves two unrelated incidents at the Valero Energy Corporation s refinery in Corpus Christi, Texas. In 1979, Valero began a $500 million expansion of its refinery. The general contractor, M.W. Kellogg Construction Company, agreed to design, engineer, provide procurement services for and coordinate construction of the project. During the expansion, a Valtek-manufactured by-pass valve, a Zink brand air preheater, and a Fisher brand computer control system were installed at the refinery.

Subsequent to the completion of the expansion project, there was an explosion at the refinery in 1984, followed by a separate, unrelated fire in 1985. Both the explosion and fire caused substantial damage to the refinery and became the basis for a lawsuit by Valero against its former contractor Kellogg. See Valero Energy Corp. v. Kellogg Constr. Co., 866 S.W.2d 252, 254 (Tex. App. Corpus Christi 1993, writ denied); Ingersoll-Rand Co. v. Valero Energy Corp., 997 S.W.2d 203, 205 (Tex. 1999).

The present case was initiated when Valero s insurers, National Union and IRI, brought subrogation claims against Zink, Fisher, Valtek, and several other parties. The trial court granted the defendants motions for summary judgment, which this Court reversed and remanded. See Nat l Union Fire Ins. Co. of PA v. John Zink Co., 972 S.W.2d 839, 848 (Tex. App. Corpus Christi 1998, pet. denied). On remand, trial was set and appellees Zink, Fisher and Valtek filed new motions for summary judgment which are now the subject of this appeal. National Union and IRI (collectively appellant-insurers ) filed a cross-motion for partial summary judgment and special exceptions. The trial court granted the appellees motions for summary judgment, and expressly denied appellant-insurers cross-motion and special exceptions.

On appeal, appellant-insurers complain (1) the trial court erred in granting appellees motions for summary judgment; (2) the trial court erred by denying appellant-insurers cross-motion for partial summary judgment; (3) the trial court erred by denying appellant-insurers special exceptions, objections, and motions to strike; (4) the trial court erred in denying appellant-insurers motions for leave to file additional summary judgment evidence; (5) the trial court erred in granting final judgment for Zink and Fisher; and (6) the trial court erred in granting final summary judgment for appellees when fact issues exist as to each of appellees defenses. Appellees respond by arguing that the trial court failed to enter a final judgment, and therefore, this Court lacks jurisdiction to hear this appeal.

Finality of Judgment

We first address the issue of the finality of the trial court s judgment. // A judgment must be final before it can be appealed. See Lehmann v. Har-Con Corp., 39 S.W.3d 191, 192 (Tex. 2001). A judgment issued without a conventional trial for example, a judgment rendered on a pre-trial motion for summary judgment is final for purposes of appeal if and only if it actually disposes of all claims and parties then before it. Id.; see also Lopez v. Sulak, 76 S.W.3d 597,603 (Tex. App. Corpus Christi 2002, no pet.). Otherwise, the judgment is only interlocutory. Lehmann, 39 S.W.3d at 192.

Complications in determining the finality of judgment may arise even when the judgment of the trial court both includes language of finality and purports to grant complete relief. Id. at 205. For example, an order granting a motion for summary judgment that addressed all of the plaintiff s claims as of the date it was filed but does not address claims added after the summary judgment motion was filed may state unequivocally that final judgment is rendered that the plaintiff take nothing by his suit. Id. at 204. Such an order grants more relief than a movant is entitled to receive from his motion. Granting more relief than the movant is entitled to makes the order reversible, but not interlocutory. Id.

Here, appellees filed their motions for summary judgment after appellant-insurers filed their sixth amended petition. Appellant-insurers then filed their seventh amended petition which raised additional claims against Zink and Fisher. // The trial court granted Zink and Fisher s motions, declaring its decision to be a final judgment and ordering that appellant-insurers take nothing by their claims.

Appellant-insurers argue in their first and fifth issues on appeal that because neither Zink nor Fisher raised grounds for summary judgment on any of appellant-insurers later-added claims, it was error for the trial court to enter final judgment in favor of those parties. However, appellant-insurers do not assert that this judgment was interlocutory. Appellees Zink and Fisher, in their appellate briefs and in Fisher s separately filed Motion to Dismiss Appeal for Lack of Jurisdiction, allege that this Court lacks jurisdiction to hear this appeal because the judgment entered by the trial court did not dispose of all claims and causes of action asserted by appellant-insurers and therefore is interlocutory and unappealable.

We agree with appellant-insurers. Appellees motions for summary judgment pre-dated and therefore could not respond to the additional claims raised by appellant-insurers in the seventh amended petition. The order entered by the trial court, which ruled that plaintiffs National Union and IRI take nothing on any of their claims, effectively granted more relief than was requested by appellees in their motions for summary judgment. It was error for the trial court to grant a final judgment based in part on claims not properly before it at the summary judgment hearing, see id. at 204, and thus we sustain appellant-insurers first and fifth issues as it relates to Fisher and Zink. Accordingly, we reverse and remand on the issue of Zink and Fisher s liability under the claims added to appellant-insurers seventh amended petition. We also deny Fisher s related motion to dismiss the appeal for lack of jurisdiction, as the judgment of the trial court is reversible but not interlocutory.

Summary Judgment

A. Standard of Review

By their first and sixth issues on appeal, appellant-insurers allege that the trial court erred in granting appellees motions for summary judgment, as genuine issues of material fact had yet to be resolved.

Appellees raised both traditional and no-evidence grounds for summary judgment. This Court reviews summary judgments de novo. See Tex. Commerce Bank-Rio Grande Valley, N.A. v. Correa, 28 S.W.3d 723, 726 (Tex. App. Corpus Christi 2000, pet. denied). We take as true all evidence favorable to the non-movant and indulge every reasonable inference in the non-movant's favor. See Spates v. Wal-Mart Stores, Inc., 144 S.W.3d 657, 661 (Tex. App. Corpus Christi 2004, no pet.). When the trial court's order granting summary judgment does not specify the grounds relied upon, we must affirm if any of the theories advanced are meritorious. See Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001).

To prevail on a traditional motion for summary judgment, the moving party has the burden of showing that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. Tex. R. Civ. P. 166a(c); Cathey v. Booth, 900 S.W.2d 339, 341 (Tex. 1995) (per curiam). A no-evidence summary judgment asserts there is no evidence of one or more essential elements of claims upon which the opposing party would have the burden of proof at trial. Tex. R. Civ. P. 166a(i). A no-evidence motion for summary judgment is properly granted only if the non-movant fails to bring forth more than a scintilla of probative evidence raising a genuine issue of material fact as to the challenged element of the claims. See id.; AMS Constr. Co. v. Warm Springs Rehab. Found., 94 S.W.3d 152, 159 (Tex. App. Corpus Christi 2002, no pet.).

The previous decision from this Court stemming from the same underlying litigation, National Union, held that because Valero s insurance claims against appellees were not expressly addressed by appellees motions for summary judgment, the trial court erred by granting complete relief to appellees. See Nat l Union, 972 S.W.2d. at 845. In particular, appellees had failed to explain whether appellant-insurers had asserted any independent claims against them apart from their liability to Valero, whether they should be treated as sub-contractors under the Valero-Kellogg contract, and why the waiver of liability in the Valero-Kellogg contract should trump the individual waivers of liability in the Zink and Fisher purchase orders. See id. In response, appellees amended and re-asserted their motions for summary judgment, this time addressing Valero s insurance claims, subrogation rights and status under the terms of the contract. The trial court subsequently granted these motions.

Appellant-insurers seventh amended petition does not assert independent claims that arise from appellant-insurers own status, but rather only asserts that appellees breached duties owed to Valero, which they now assert on Valero s behalf as its insurers. Therefore, we can appropriately apply the previous decisions from this Court that address the liability of Valero under its contract with Kellogg. See Eagle Properties, Ltd. v. Scharbauer, 807 S.W.2d 714, 721 (Tex. 1990) (concluding collateral estoppel for issues previously litigated is binding on a party and those in privity with him); see also Espeche v. Ritzell, 123 S.W.3d 657, 667 (Tex. App. Houston [14th] Dist. 2003, pet. denied) ("Privity exists if the parties share an identity of interests in the basic legal right that is the subject of the litigation.").

B. Subcontractor Liability

Appellant-insurers claims against appellees involve assertions of negligence, products liability, and breach of contract. Appellees moved for summary judgment on all claims, alleging as an affirmative defense that these claims are barred by the terms of the contract between Valero and Kellogg and that appellant-insurers are estopped from asserting them by the prior holding of this Court in Valero, 866 S.W.2d at 258. On appeal, appellant-insurers argue that appellees never provided evidence that they were sub-contractors to Kellogg and therefore entitled to assert these defenses. The Valero-Kellogg contract includes a provision allocating liability between the parties. The relevant language of this provision provides that:

[Valero] shall release, defend, indemnify and hold harmless [Kellogg], its subcontractors and affiliates and their employees performing services under this Agreement against all claims, liabilities, loss or expense . . . including losses attributable to [Kellogg s] negligence . . .

Neither [Kellogg] nor its affiliates nor its subcontractors or vendors, either individually or jointly shall be liable to [Valero] or its affiliates, irrespective of whether alleged to be due to negligence or otherwise . . . .

The contract on its face absolves Kellogg and its sub-contractors from all liability against all claims beyond what is covered by Kellogg s own insurance.

This Court has previously considered the liability of Kellogg s sub-contractors for damages resulting from the Valero refinery fire and explosion under the Valero-Kellogg contract:

Parties may agree to exempt one another from future liability for negligence so long as the agreement does not violate the constitution, a statute, or public policy. When the parties to the contract are private entities bargaining from positions of substantially equal strength, the agreement is usually enforced. . . . Valero and Kellogg are sophisticated entities, replete with learned counsel and a familiarity with the oil refinery industry. . . . Valero, having a bargaining power equal to Kellogg's, agreed to the exculpatory clause in this contract. Valero possessed the resources necessary to ascertain and understand the rights it held on the date of the signing of the contract, and those it would hold in the future. Nevertheless, Valero, of its own accord, negotiated those rights away.

The waiver and indemnity provision absolving Kellogg of all liability sounding in products liability and gross negligence does not offend public policy.

Similarly, Ingersoll-Rand, as one of Kellogg's subcontractors, is also addressed in the Valero/Kellogg contract as an entity entitled to protection under the waiver and hold-harmless clauses. As such, it, too is held harmless and is indemnified under the contract fairly negotiated between Kellogg and Valero.

Valero, 866 S.W.2d at 257-58 (citations omitted, emphasis added). Thus, we find that the issue of sub-contractor liability under the Valero-Kellogg contract has been previously decided by this Court. Appellant-insurers, as insurance providers whose claims against appellees derive from Valero s claims against Kellogg s subcontractors, are therefore estopped from reasserting these claims here. See Nat l Union, 972 S.W.2d at 844 ( The subrogees stand in the shoes of the one whose rights they claim, and the extent of the subrogees remedy and the measure of their rights are controlled by those possessed by the subrogor. ). The remaining issue the trial court faced was whether appellees could benefit from this prior holding by claiming that they were qualified to claim the status of subcontractor to Kellogg.

A subcontractor is defined as a party who takes and performs a portion of a contract from a principal contractor or who enters into a contract for the performance of an act with a person who has already contracted for its performance. See Tex. United Ins. Co. v. Burt Ford Enter., Inc., 703 S.W.2d 828, 832 (Tex. App. Tyler 1986, no writ); Black s Law Dictionary 1424 (6th ed. 1990).

Appellees Zink, Fisher and Valtek all claimed to be subcontractors to Kellogg. We first address the claims of Zink and Fisher. Attached to its motion for summary judgment, appellee Zink provided substantial documentation establishing its subcontractor status, including its bid to provide the air heater, and Kellogg s subsequent acceptance of the bid in a purchase order. This evidence serves to establish that a contract was entered into between Kellogg and Zink for a part of the Valero refinery expansion project that Kellogg had already contracted to perform. See Tex. United Ins. Co., 703 S.W.2d at 832; see also Hardin Constr. Group v. Strictly Painting, 945 S.W.2d 308, 313 (Tex. App. San Antonio 1997, no writ) (holding that letter from one party coupled with substantial performance by that party bound party to contract as subcontractor).

Appellee Fisher has also provided substantial evidence of a similar nature: the record includes an inquiry from Kellogg regarding the computer control system, a bid from Fisher in response, and acceptance of the bid from Kellogg in the form of a purchase order. Thus, the evidence attached to Zink and Fisher s motions for summary judgment conclusively establishes that they were in fact subcontractors to Kellogg and could benefit from Valero s waiver of liability to Kellogg and its subcontractors for the refinery expansion project. See Tex. United Ins. Co., 703 S.W.2d at 832. The trial court therefore did not err in granting Zink and Fisher s motion for summary judgment on these grounds. //

Appellant-insurers also assert in their petition that appellees Zink and Fisher are liable to Kellogg and Valero for breach of warranties and guarantees they specifically made in the terms of the purchase orders they signed, which state that appellees shall defend and hold [Kellogg and Valero] harmless . . . for loss of and/or damage to property caused in whole or in party by the negligence or willful acts of [appellees] in connection with the Materials furnished hereunder, including without limitation, the installation, erection, repair, adjustment or operation thereof. . . However, these purchase orders were signed in June 1981, and the Valero-Kellog contract, which expressly waived liability for Kellogg and its subcontractors, was signed in May 1982. When parties have concluded a valid integrated agreement with respect to a particular subject matter, the parol evidence rule precludes the enforcement of inconsistent prior or contemporaneous agreements. Weinacht v. Phillips Coal Co., 673 S.W.2d 677, 679 (Tex. App. Dallas 1984, no writ). As there was no subrogation by Kellogg to appellant-insurers of any claim it could pursue against its subcontractors, we find the provisions for liability discussed in the Zink and Fisher purchase orders were pre-empted by the express waiver of liability for Kellogg s subcontractors in the later-signed Valero-Kellogg contract. See id.

We now turn to the status of Valtek. Appellant-insurers claims against Valtek focus on Valtek s actions as a manufacturer and seller of industrial valves. Valtek, in its motion for summary judgement, provided no evidence of any contractor-subcontractor or contractor-vendor relationship between itself and Kellogg. The evidence Valtek produced in support of its motion for summary judgment focuses only on the testing and reliability of the valve involved in the refinery incidents. Valtek is seeking to absolve itself of liability by demonstrating not that it was a subcontractor but rather that it was not negligent and its valve was not defective. In all of Valtek s summary judgment evidence, Kellogg is only mentioned in a reply to an interrogatory from appellant-insurers: the valve met the requirements supplied by [Kellogg] for the designated service. The other appellees provided signed agreements, invoices and purchase orders demonstrating an offer and acceptance occurred between themselves and Kellogg. Valtek, beyond bare assertions in its motion for summary judgment, did not provide any evidence to indicate that it had a business relationship with Kellogg such that it could be considered Kellogg s subcontractor for purposes of the Valero-Kellogg project. Kellogg could have acted as an intermediary setting mechanical specifications for a product sold by Valtek to Valero, or Valtek could have sold to Kellogg simply as a merchant, with no intent to be considered a subcontractor under the Valero contract. The evidence does not support any particular interpretation of the Valtek-Kellogg relationship. Thus, Valtek s status as a sub-contractor is an unresolved issue of material fact. Accordingly, it was error for the trial court to grant summary judgment for Valtek on these grounds. We sustain appellant-insurers issue only as it relates to Valtek and reverse and remand to the trial court for further proceedings.

Motion for Partial Summary Judgment

In their second issue, appellant-insurers seek review of their cross-motion for partial summary judgment. This Court may address cross-motions for summary judgment so long as both parties have sought final judgment relief in their motions. CU Lloyd s of Tex. v. Feldman, 977 S.W.2d 568, 569 (Tex. 1998); Krishnan v. Law Offices of Preston Henrichson, P.C., 83 S.W.3d 295, 303 (Tex. App. Corpus Christi 2002, pet. denied); see also Faulkner v. Bost, 137 S.W.3d 254, 261 (Tex. App. Tyler 2004, no pet.) ( Before a court of appeals may review an order denying a cross-motion for summary judgment not covered by an interlocutory appeal statute, both parties must have sought final judgment in their motions. ). Because appellant-insurers have not filed a final summary judgment motion, we cannot render judgment at this time. See Krishnan, 83 S.W.3d at 303. Appellant-insurers second issue is overruled.

Special Exceptions

By their third issue on appeal, appellant-insurers allege the trial court erred in denying their special exceptions, objections, and motions to strike and in granting appellees special exceptions, objections and motions to strike. Appellant-insurers failed to include analysis of this complaint in their brief, and instead request that they be allowed to file briefs addressing this issue if we did not reverse the judgment below. As we have reversed part of the judgment below, we decline to allow appellant-insurers further opportunity to brief this complaint on appeal. See Tex. R. App. P. 38.9(b).

Summary Judgment Evidence

In their fourth issue, appellant-insurers allege that the trial court erred in denying their motions for leave to file additional summary judgment evidence and further responses. Appellant-insurers brief and reply brief, however, fail to address this issue beyond simply listing it among the Issues Presented. There is no analysis of the legal or factual issues involved nor any citation to relevant authority. See Tex. R. App. P. 38.1. Therefore, appellant-insurers have waived our consideration of fourth issue due to their inadequate briefing. See Sunnyside Feedyard v. Metro. Life Ins. Co., 106 S.W.3d 169, 173 (Tex. App. Amarillo 2003, no pet.).

Conclusion

We sustain, in part, appellant-insurers first and sixth issues on appeal, and we accordingly reverse and remand the trial court s order granting Valtek s motion for summary judgment. We also reverse the trial court s order granting summary judgment for Fisher and Zink and remand for consideration of the newly-added issues not addressed in their motions. //

Rogelio Valdez,

Chief Justice

Memorandum Opinion delivered and filed

this 17TH day of March, 2005.