Todd Shipyards Corporation v. Perez (2000)

Our plain-English summary of Todd Shipyards Corporation v. Perez (Texas Supreme Court, May 18, 2000).

This is a dissent from the Texas Supreme Court's denial of review, not a ruling on the merits. Guadalupe Garcia worked for Todd Shipyards from 1954 to 1974. In 1988 he was diagnosed with asbestos-related pleural disease and possible asbestosis, and he sued several defendants that had supplied asbestos products to Todd. Todd's bankruptcy reorganization plan was confirmed in 1990. Garcia died of metastatic mesothelioma in 1992. His eight daughters then sued Todd for wrongful death under the Texas Constitution. The trial court granted summary judgment for Todd, holding that its bankruptcy discharge barred the claim. The court of appeals reversed. The Supreme Court denied review. Justices Hecht and Owen dissented. They would have heard the case because courts disagree on whether a bankruptcy discharge bars a later death claim based on the debtor's earlier conduct. They also wanted to decide whether a constitutional wrongful death claim requires that the dead person could have sued just before death.

We wrote this summary from the court's opinion with the help of AI. It is not the court's wording, and it is not legal advice. The full opinion is below.

The decision

• Court: Texas Supreme Court
• Decided: May 18, 2000
• Citation: 35 S.W.3d 598
• Docket: No. 99-0697
• Stage: Appeal from summary judgment
• State: Texas

Outcome. The Texas Supreme Court denied Todd Shipyards' petition for review, leaving in place the court of appeals' reversal of summary judgment for Todd and in favor of Garcia's daughters; Justices Hecht and Owen dissented from the denial.

Issues decided: Asbestos Bankruptcies, Wrongful Death and Survival.

The people and their exposure

• Guadalupe Garcia: mesothelioma, pleural plaques and thickening; died

Who	Work	Where	When	Products
Guadalupe Garcia	employee (shipyards and maritime work)	Todd Shipyards	1954-1974

The defendants

• Todd Shipyards Corporation (employer)

Decisions this opinion cites

Earlier decisions in our library that the court cited:

• Temple-Inland Forest Products Corp. v. Carter (Texas Supreme Court, 1999). The Texas Supreme Court reversed the court of appeals' judgment to the extent it reinstated the plaintiffs' actual damages claims, and rendered judgment that Carter and Wilson take nothing against Temple-Inland, which won.
• Perez v. Todd Shipyards Corp. (Texas Court of Appeals, 1999). The court of appeals reversed the summary judgment for Todd Shipyards, which had been based on its bankruptcy discharge, and remanded to the trial court for further proceedings in favor of the decedent's children.

Later decisions citing this one

One later decision in our library cites this one:

• Ross v. Union Carbide Corporation (Texas Court of Appeals, 14th District, 2009). The en banc court affirmed summary judgment for Union Carbide, holding that the 1993 release signed by Homer and Marjorie Ross barred the survivors' exemplary-damages and loss-of-consortium claims, and it overruled Perez v. Todd Shipyards.

The court's opinion

The text below is Google Scholar's copy of the court's opinion, a public record. Numbers in brackets, such as [*921], mark where each page of the printed reporter begins.

35 S.W.3d 598 (2000)

TODD SHIPYARDS CORPORATION, Petitioner,

v.

Janie PEREZ, etal., Respondents.

No. 99-0697.

May 18, 2000.

Rehearing Overruled October 12, 2000.

Supreme Court of Texas.

Richard A. Sheehy, James L. Ware, Houston, for Petitioner.

Richard N. Countill, John R. Fabry, John E. Williams, Jr., Ian P. Cloud, Houston, for Respondent.

Review denied.

Justice HECHT, joined by Justice OWEN, dissenting from the denial of the petition for review.

The issue in this case is whether an employer's discharge in bankruptcy bars a claim for the subsequent

death of a former employee allegedly caused by the debtor's pre-petition conduct. Because this is an

important issue that has already arisen in several cases and is likely to recur, and because the courts that

have considered the issue are in disagreement, I would grant the petition and set oral argument. I

respectfully dissent from the Court's summary denial of the petition.

Guadalupe Garcia worked for Todd Shipyards Corp. from 1954 to 1974. In 1987, Todd petitioned for

reorganization under chapter 11 of the Bankruptcy Code. In 1988, Garcia was diagnosed with asbestos-

related pleural disease and possible pulmonary asbestosis. That same year, he sued various defendants,

alleging that his health problems had been caused by exposure at work to asbestos products that they had

supplied to Todd. In 1990, the United States Bankruptcy Court confirmed Todd's plan of reorganization. In

1992, at the age of 80, Garcia contracted and died from metastatic mesothelioma. In 1994, Garcia's

survivors obtained a judgment against the defendants in the 1988 suit, and Garcia's eight daughters

brought this wrongful death action against Todd under article XVI, section 26 of the Texas Constitution.[1]

(Such an action is not prohibited by the Workers' Compensation Act.[2]) The trial court granted summary

judgment for Todd, holding that the plaintiffs' claim was barred by Todd's bankruptcy discharge. The court of appeals reversed, holding that as a matter of law, the plaintiffs' claim is not barred.[3]

Todd argues that the plaintiffs' action is a "claim" as defined by the Bankruptcy Code[4] that was discharged by confirmation of Todd's plan of reorganization. Whether a liability claim under state law constitutes a claim in bankruptcy is, of course, a matter of federal law. In the Fifth Circuit, the law appears to be that for a post-petition [*599] claim of injury to be dischargeable in bankruptcy, the cause of injury must be traceable to the debtor's pre-petition conduct and some pre-petition relationship must have existed between the claimant

and the debtor.[5] Garcia had a direct relationship with Todd, and thus any claim he had prior to confirmation of Todd's reorganization plan[6] should have been discharged in bankruptcy, but his daughters' only

relationship with Todd was through their father. The court of appeals concluded that the plaintiffs'

relationship with Todd was not sufficient for their claim to have been discharged, but on essentially identical facts,[7] the United States District Court for the Southern District of Texas has reached exactly the opposite conclusion.[8] Judge Rosenthal's memorandum opinion for the federal court refers to several other claims

against Todd by other plaintiffs who appear to be similarly situated.

Todd also argues that the plaintiffs' claim is barred by the bankruptcy discharge because their claim is

derivative of their decedent's rights, and any claim he had against Todd before his death was clearly barred

by the bankruptcy discharge. This Court has held that a statutory wrongful death claim can be asserted only

if the decedent could have maintained suit for his injuries immediately prior to his death.[9] Whether this

same rule should apply to a constitutional wrongful death claim is an important issue.

These issues have been well and thoroughly briefed by exceedingly able counsel, and I would hear

argument and resolve them.

[1] "Every person, corporation, or company, that may commit a homicide, through wilful act, or omission, or gross neglect, shall be responsible, in exemplary damages, to the surviving husband, widow, heirs of his or her body, or such of them as there may be, without regard to any criminal proceeding that may or may not be had in relation to the homicide."

[2] Tex.Labor Code § 408.001(b).

[3] 999 S.W.2d 31.

[4] 11 U.S.C. § 101(5)(A) (stating that a claim includes "[a] right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured"). [5] See Lemelle v. Universal Mfg. Corp., 18 F.3d 1268, 1274-77 (5th Cir.1994); In re Fairchild Aircraft Corp., 184 B.R. 910, 923-24 (Bankr. W.D.Tex. 1995), vacated on other grounds, 220 B.R. 909 (Bankr.W.D.Tex.1998); In re National Gypsum, 139 B.R. 397, 406 (N.D.Tex. 1992).

[6] Cf. Childs v. Haussecker, 974 S.W.2d 31 (Tex. 1998) (accrual of cause of action for latent occupational disease); Temple-Inland v. Carter., 993 S.W.2d 88 (Tex. 1999) (no cause of action for fear of possible future disease).

[7] 999 S.W.2d at 34-35.

[8] Williams v. Todd Shipyards Corp., Civil Action No. H-95-4592, slip op. at 14-18 (S.D.Tex. Feb. 12, 1997) (Rosenthal, J.); after final judgment, aff'd on other grounds, 154 F.3d 416 (5th Cir.1998) (table of cases).

[9] Russell v. Ingersoll-Rand Co., 841 S.W.2d 343, 347 (Tex.1992).

Sources

• The opinion on Google Scholar
• Texas asbestos laws
• Texas asbestos exposure sites