Evelyn V. Keyes Justice

DISSENTING OPINION

Evelyn V. Keyes Justice

I respectfully dissent. The majority affirms summary judgment in favor of appellee Gulshan Enterprises, Inc. against Tonya Bauer, guardian of Emily Bauer, an incapacitated person. I would reverse and remand this case for trial on the merits of Bauer's negligent undertaking claim.

The essential issue in this case is whether Gulshan owed a duty of reasonable care to Emily Bauer, a customer of the "Phillips 66" service station and Handi-Stop #79 on Huffmeister Road in Houston, Texas, to which Gulshan marketed ConocoPhillips branded gas. In resolving this issue, we must first determine whether Gulshan by agreement with ConocoPhillips undertook a duty not to permit the sale of illegal drugs and drug paraphernalia on the premises of the Phillips 66 service station and the Handi-Stop to protect the reputation and good will of ConocoPhillips by protecting the community and customers of the store from harm. If Gulshan did assume such an undertaking, then it owed Emily a duty of reasonable care in performing the undertaking if: (1) it assumed the undertaking in performance of a duty that ConocoPhillips owed to its customers and the community; (2) its assumption of the undertaking prevented ConocoPhillips from taking action itself; or (3) its failure to use reasonable care in performing the undertaking increased the risk to the community and customers of the station and convenience store that teenagers living in the community—including Emily Bauer, the victim of this story, and her friends—would purchase the illegal synthetic marijuana openly displayed in the Handi-Stop, smoke it, and suffer grave physical harm, as Emily did.

I would hold that, by written agreement with ConocoPhillips, Gulshan expressly undertook a duty of reasonable care to ensure that illegal drugs are not sold on the premises of the Phillips 66 service station and the Handi-Stop. I would further hold that the Bauer family has raised a material fact issue as to whether Gulshan breached that duty by permitting the exact activity that gravely injured Emily and by not notifying ConocoPhillips of that ongoing activity the Handi-Stop so that it could take steps to protect the community and its own reputation.

The majority, however, resolves the duty issue in the negative despite the plain language of the "Branded Marketer Agreement" between Gulshan and ConocoPhillips (the BMA). It declares that there is no evidence that Gulshan assumed and breached any duty owed to the community and customers of the Handi-Stop and thereby increased the risk, foreseeability, and likelihood of injury to members of the community and customers of the Handi-Stop, including Emily Bauer.

I read the majority's holding as directly contrary to the plain language of the "Branded Marketer Agreement" between Gulshan and ConocoPhillips. The BMA branded the service station that housed the Handi-Stop as a ConocoPhillips service station and imposed strict duties on the marketer of ConocoPhillips gasoline to the station, Gulshan. These contractual duties expressly included the duty not to permit the Handi-Stop to sell illegal drugs and drug paraphernalia in order to protect ConocoPhillips' good name by protecting the station's and the Handi-Stop's customers from harm.

I also read the majority opinion as conflating simple common-law negligence, premises liability, and negligence in performing an undertaken duty. I would apply the law of negligent undertaking as Bauer pleaded it, and I would conclude as a matter of law that Gulshan assumed a duty of reasonable care not to permit the illegal activities of the sale of synthetic marijuana and drug paraphernalia on the premises of the service station and the Handi-Stop. See Del Lago Partners, Inc. v. Smith , 307 S.W.3d 762, 767 (Tex. 2010) ("Whether a duty exists is a question of law for the court and turns ‘on a legal analysis balancing a number of factors, including the risk, foreseeability, and likelihood of injury, and the consequences of placing the burden on the defendant.’ ") (quoting Gen. Elec. Co. v. Moritz , 257 S.W.3d 211, 217, 218 (Tex. 2008) ). I would then hold that Bauer has raised material fact issues with respect to whether Gulshan breached its duty and whether that breach caused Emily Bauer's injuries. Finding evidence to support each element of Bauer's negligent undertaking claim, I would hold that Gulshan failed to establish its right to summary judgment.

I would reverse the trial court's summary judgment in favor of Gulshan and remand the case for trial on the merits.

Background

The majority is generally correct in its statement of the facts of the case and the standard of review of no evidence and traditional summary judgment. However, it omits the standard of review of the central question here—the existence of a duty. See Black + Vernooy Architects v. Smith , 346 S.W.3d 877, 882–83 (Tex. App.—Austin 2011, pet. denied) ("[A]ppellate courts review de novo a determination regarding whether a legal duty is owed."). It also omits material facts essential to the application of the correct law to this case, and it conflates and misapplies the standard of review of common-law negligence, premises liability, and negligent undertaking. I restate and supplement only those facts that are material to this analysis of Gulshan's liability to Bauer on a negligent undertaking liability theory. And I restate the standard of review as it applies to the contractual undertaking of a duty to a party to a contract or to a third party.

As detailed in the majority opinion, Gulshan had a complex and ongoing business relationship both with ConocoPhillips, whose gasoline it delivered and received payment for, on the one hand, and with the owners and operators of the Handi-Stop, on the other. I will not repeat those material facts.

Critical to this analysis, however, is the BMA executed by ConocoPhillips and Gulshan, which I review de novo. The interpretation of an unambiguous contract is a question of law that appellate courts review de novo using well-settled contract-construction principles. See URI, Inc. v. Kleberg Cty. , 543 S.W.3d 755, 763 (Tex. 2018) (holding that interpretation of unambiguous contract is question of law that is reviewed de novo). Under the terms of the BMA, ConocoPhillips agreed to sell its branded gasoline to Gulshan, as "Marketer." Gulshan could then sell ConocoPhillips' gasoline through stations ConocoPhillips owned or operated, or he could sell it to independent dealers who owned or operated service stations (Marketer Supplied Dealers). Also in the BMA, ConocoPhillips granted Gulshan a license to use certain ConocoPhillips brand names in the advertising, distribution, and sale of gasoline and to display ConocoPhillips' brand identification and signage at the stations Gulshan supplied. Gulshan's name was also prominently displayed above the entrance door to the Handi-Stop.

Pertinent to this litigation, the recitals in the BMA stated that ConocoPhillips had a protectable business interest in ensuring that Gulshan's sales and distributions of ConocoPhillips products would be accomplished in a manner respecting the standards, reputation, and integrity of the ConocoPhillips brands. And, in Section 4(B), the BMA reserved to ConocoPhillips the right to revoke its approval to use the ConocoPhillips brand at stores that "fail[ed] to conform the Marketer Supplied Outlet to ConocoPhillips' then-current Brand and Image Standards and requirements set forth in Section 5."

The "Brand and Image Standards" set forth in Section 5 of the BMA required that Marketers—here Gulshan—and their Marketer Supplied Outlets—here Handi-Stop #79—and Marketer Supplied Dealers—here Bin Enterprises, Inc., the owner of Handi-Stop #79—uphold certain standards reflecting on the reputation of ConocoPhillips in the community. These included treating all persons fairly, honestly, and courteously; providing efficient service to consumers; properly addressing consumer complaints; keeping the building and grounds clean; operating with well-groomed personnel; and operating during certain business hours.

Most pertinently, Section 5(D) of the BMA, on which Bauer relies, provided:

Consistent with the principles herein set forth, ... [Gulshan] shall conduct its independent business operations in compliance with the standards set forth below , which will promote the continuing good reputation of ConocoPhillips and all other branded ConocoPhillips marketers. [Gulshan] shall ensure to ConocoPhillips that all Marketer Supplied Outlets [such as Handi-Stop #79] and the Marketer Supplied Dealers [such as Bin, the owner of Handi-Stop #79] shall also comply with these standards.

....

(D) Each Marketer Supplied Outlet [Handi-Stop #79] must complement the community and the environment. Furthermore, [Handi-Stop #79] must not engage, permit, or cooperate in any conduct that reflects unfavorably on the reputation of ConocoPhillips in the community served by [Gulshan], or in ConocoPhillips' opinion impairs the goodwill associated with the ConocoPhillips Brands , or constitutes a deceptive or unfair trade practice under applicable laws. [Gulshan] shall cooperate, and shall take reasonable steps to ensure that the operators of each Marketer Supplied Outlet, its Marketer Supplied Dealers, its employees, vendors, contractors[,] and agents cooperate, fully with the performance of [Gulshan's] obligations under this [BMA] .... [Gulshan] shall not permit on, in[,] or from [Handi-Stop #79]:

i. price gouging ...;

ii. any illegal consumption of intoxicating beverages;

iii. the sale or use of illegal drugs or drug paraphernalia ;

iv. the sale of tobacco ... or alcoholic beverages to minors ...; or

v. any offensive merchandise ....

(Emphasis added.)

In addition, Section 5(G) set forth the terms of the mandatory Brand and Image Standards program, which "evaluate[d] the implementation of the Brand and Images Standards at the Marketer Supplied Outlets." As part of the program, evaluations of Marketer Supplied Outlets would be "communicated through an evaluation form completed by ConocoPhillips or its designee." If a Marketer Supplied Outlet like Handi-Stop #79 failed an evaluation, the Marketer—Gulshan—was obligated to take prompt action to correct the deficiencies identified on the evaluation form. If a Marketer Supplied Outlet had "repeated failing evaluations or repeated or habitual Brand and Image Standards deficiency failures," ConocoPhillips had the right to assess a fee against the Marketer or to debrand the Marketer Supplied Outlet.

Finally, Section 5(J) of the BMA provided that, if the Marketer failed to comply, or to ensure compliance, with the Brand and Image Standards, ConocoPhillips could assess fees against that Marketer or, if the failure to comply involved multiple Marketer Supplied Outlets, terminate the BMA:

[Gulshan] specifically understands and agrees that the Brand and Image Standards are reasonable and of material significance to this [BMA] and to the consumers who patronize Marketer Supplied Outlets ... [Gulshan] further understands and will ensure that its Marketer Supplied Dealers [like the Handi-Stop] understand and acknowledge that it is reasonable for ConocoPhillips to debrand any Marketer Supplied Outlet which does not comply with this Section 5, or to terminate this [BMA] in its entirety where the violation involves multiple Marketer Supplied Outlets, upon written notice.

(Emphasis added.)

Despite the emphasis in the BMA on Gulshan's responsibility to ensure that ConocoPhillips' Brand and Image Standards were observed not only by itself but by the Marketer Supplied Outlets that it served, like Handi-Stop #79, and the Marketer Supplied Dealers, like Bin, the summary judgment record shows that Gulshan failed in its obligation to take reasonable steps to ensure full cooperation with its mandatory obligation under the BMA to uphold ConocoPhillips' Brand and Image Standards at the Handi-Stop. And specifically, it failed in its obligation not to permit the sale of illegal drugs and drug paraphernalia.

The record shows that the Handi-Stop was well known to Emily and the other teenagers in the neighborhood for selling illegal synthetic marijuana and drug paraphernalia throughout 2011 and 2012. The synthetic marijuana came in varying strengths and flavors such as grape, strawberry, and pineapple. The packages of synthetic marijuana available for purchase at the store were in plain sight. As a friend of Emily Bauer testified by affidavit, "The bags or brands of synthetic marijuana, such as Kush, Klimax, Cloud 9 and Dopey, were taped to the inside of the dividing window by the cash register so customers could see what was available for purchase." This friend also testified that other drug paraphernalia, including bongs, pipes, and grinders, was in plain sight by the cash register at all times. This was the case on December 7, 2012, when Emily and her friends visited the store and purchased one package of "Kush" synthetic marijuana and one package of "Klimax" synthetic marijuana, which Emily smoked that night.

Emily's boyfriend also testified by deposition to the same facts. He was with Emily the day the synthetic marijuana that caused her harm was purchased and in the evening, when she smoked it. He also testified that the Handi-Stop had a "Smoke Shop" sign outside, and he defined a smoke shop as a shop that "sells cigars, glassware, occasionally cigarettes." He further testified that "glassware" means "bongs and pipes, grinders," and that grinders are used to grind up marijuana so that it can be rolled into a cigar. He also testified that once synthetic marijuana became illegal the only local place it could be bought in the community was "the Phillips 66" where Handi-Stop #79 was located. On the day Emily had her massive strokes and heart attack, she and her friends had smoked the synthetic marijuana bought that day at the Handi-Stop and had used no other type of drugs.

Summary Judgment Standard of Review

In her sole issue, Bauer argues that the trial court erred in granting Gulshan's motion for no-evidence summary judgment on her negligence claim because she presented more than a scintilla of evidence on each of the challenged elements of her claim. See TEX. R. CIV. P. 166a(i) (setting forth requirements for no-evidence summary judgment). I adopt the majority's statement of summary judgment law, but restate the law of negligent undertaking as set out below.

Negligent Undertaking

Bauer pleaded this case as a simple negligence case, a negligent undertaking case, and also a premises liability case—only to abandon her premises liability theory and to rely upon her negligent undertaking theory as the basis of Gulshan's liability to her. I agree that this is a negligent undertaking case.

A. Assumed duty to the other party to an agreement

The supreme court addressed the law of negligent undertaking with respect to liability to a party to an agreement in which a duty to the other party is undertaken in Torrington Company v. Stutzman. See 46 S.W.3d 829, 838–39 (Tex. 2000). In Torrington , the plaintiffs brought a wrongful death and survival suit against the manufacturer of a Navy helicopter that crashed, killing two Marines, and against the manufacturer of the failed ball bearing that caused the crash. Id. at 833. Following a jury verdict in favor of the survivors submitted on a broad-form negligence question, the ball bearing manufacturer appealed. Id. The central issue was whether the ball bearing manufacturer had undertaken a duty to its customers to investigate and identify potentially defective bearings. Id. at 836.

The Torrington court held that the survivors' negligent undertaking theory failed in that case because it had been improperly submitted to the jury, and it reversed the jury verdict in favor of the survivors on the ground that "the broad-form negligence question [submitted to the jury] omitted elements necessary to establish an undertaking claim." Id. at 839. However, rather than render judgment against the survivors, the court remanded the case to the trial court, explaining that "we have remanded in the interest of justice when our decisions have altered or clarified the way in which a claim should be submitted to the jury." Id. at 840.

The Torrington court observed that, years before, in Colonial Savings Association v. Taylor , 544 S.W.2d 116, 120 (Tex. 1976), the supreme court had adopted section 323 of the Restatement (Second) of Torts, which states the law of negligent undertakings in suits brought by a party to an agreement against another party alleged to have undertaken a duty to the injured party:

One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of the other's person or things, is subject to liability to the other for physical harm resulting from his failure to exercise reasonable care to perform his undertaking, if

(a) his failure to exercise such care increases the risk of such harm, or

(b) the harm is suffered because of the other's reliance upon the undertaking.

Id. at 337–38 (quoting RESTATEMENT (SECOND) OF TORTS § 323 (1965) ); see Colonial Savs. , 544 S.W.2d at 120 (same). The Colonial Savings court stated,

The rule as stated in Section 323 of the Restatement, quoted above, imposes liability for injuries caused by the negligent performance of a gratuitous undertaking, if (a) the actor's negligence has increased the risk of physical harm, or (b) the injured party has relied upon the undertaking.

544 S.W.2d at 120 (holding that lienholder that had undertaken to provide fire insurance coverage for structures on property in which it held security interest had duty to exercise reasonable care to perform that undertaking, but finding that lienholder had not increased risk of fire by failing to insure structure that sustained fire damage).

Thus, Torrington and, before it, Colonial Savings set out the law of negligent undertaking when the defendant has undertaken to render services to another party "which he should recognize as necessary for the protection of the other's person or things" and performs that duty negligently. See RESTATEMENT (SECOND) OF TORTS § 323 ; Torrington , 46 S.W.3d at 838 ; Colonial Savs. , 544 S.W.2d at 120. In this case, section 323 sets out the law with respect to a claim against Gulshan made by ConocoPhillips for Gulshan's failure to perform its obligations to ConocoPhillips undertaken in the BMA.

B. Assumed duty to a third party

However, neither Torrington nor Colonial Savings sets out the law of negligent undertakings for those cases in which the breach of an undertaken duty leads to an injury to a third party rather than to the party with whom the defendant has contracted, gratuitously or for pay, to provide services. That important gloss to negligent undertaking law was added by the Dallas Court of Appeals well after Colonial Savings but before Torrington in Seay v. Travelers Indemnity Company , 730 S.W.2d 774, 775–78 (Tex. App.—Dallas 1987, no writ).

In Seay , a hospital maintenance worker was killed when a safety valve on a boiler adjacent to the boiler he was working on at Gaston Episcopal Hospital discharged scalding water onto him. Id. at 775. His wife and children brought a wrongful death and survival suit against Travelers Indemnity Company, which had insured the hospital, alleging that Travelers had undertaken to inspect the boiler that injured Seay and that it had performed its duty negligently, causing Seay's injuries. Id. The boiler was subject to the provisions of the Texas Boiler Inspection Act, which required periodic inspections and safety certification as a condition to the boiler's operation. Id. If the boiler met the requirements of the Department of Labor and Standards, the Commissioner would issue a "certificate of operation," allowing the boiler to be lawfully used; and, if not, the Commissioner could order the owner to repair the boiler, prohibit its use, or, in extreme instances, condemn it. Id.

Mrs. Seay argued that, as a result of undertaking to inspect the boilers at Gaston, Travelers owed a duty to Mr. Seay pursuant to the common law and to section 324A of the Restatement (Second) of Torts to exercise ordinary care in inspecting the boilers. Id. Travelers denied that it had any duty to Seay. Id. at 776. The court of appeals held that "section 324A accurately describes the scope of the duty owed by one undertaking a task necessary to the protection of a third person, and ... the rule stated therein is the law in the State of Texas." Id. at 777. It then held that the burden was on Travelers, as summary judgment movant, to disprove at least one element of Mrs. Seay's claim as a matter of law and that it had failed to do so. Id. 777–80.

The court of appeals reversed the summary judgment in favor of Travelers. It held that Travelers had been hired by Gaston to perform the legally mandated inspections "designed to promote the safety of boilers," and the evidence "fail[ed] to disprove that Travelers was performing a duty of care owed by Gaston to its employees, including the decedent." Id. at 780. It further held that material fact issues were raised as to whether there were specific safety standards that must be met for the certificate of operation to issue and whether Travelers knew that there was "a specific standard applicable to the exact danger which was material to Mrs. Seay's cause of action." Id. Finally, the court held that Travelers had not proved as a matter of law that it had no means of enforcing compliance with the safety standards of the Boiler Inspection Act, under which a report by Travelers finding the safety valves on the boiler to be dangerous would have been "expected to initiate enforcement procedures compelling the very repairs and alterations which were actually undertaken by Gaston once the death of Mr. Seay alerted Gaston officials to the danger." Id.

The Seay court—like the supreme court in Tarrington after it—observed that the Texas Supreme Court had adopted section 323 of the Restatement (Second) of Torts in Colonial Savings as long ago as 1976—a ruling later to be reaffirmed in Torrington. And it further observed that the Texas Supreme Court had also adopted, in Fox v. Dallas Hotel Company , 240 S.W. 517, 520–21 (Tex. 1922), the rule underlying section 324A of that Restatement. Id. at 776 (regarding the duty owed to a third party by one who has undertaken a contractual duty he should recognize as necessary to protect the third party). The court stated,

Section 324A of the Restatement (Second) of Torts provides:

One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of a third person or his things, is subject to liability

to the third person for physical harm resulting from his failure to exercise reasonable care to [perform ] his undertaking , if

(a) his failure to exercise reasonable care increases the risk of [such] harm, or

(b) he has undertaken to perform a duty owed by the other to the third person, or

(c) the harm is suffered because of reliance of the other or the third person upon the undertaking.

Id. at 775–76 (quoting RESTATEMENT (SECOND) OF TORTS § 324A (1965) ) (emphasis added).

The Seay court held that section 324A and Fox controlled the disposition of Seay's case in that Seay, like Fox, was a third party injured by the breach of a duty owed to another that the defendant should have recognized as important for the third party's protection. The Seay court pointed out that, in Fox , the defendant, Dallas Hotel Company, had entered into a contract to maintain and repair elevators in a building under the control of the employer of Fox, who was killed by an elevator in the building. Id. at 776 (citing Fox , 240 S.W. at 520 ). Holding that Dallas Hotel Company was liable to the Fox family in tort, the supreme court stated, "Upon [the defendant] taking over the control and repair of the elevators ... it became charged with the duty ... to exercise ordinary care ... " to protect third parties like Fox. Fox , 240 S.W. at 520.

The Seay court opined, "The [Texas Supreme] Court's discussion [in Fox ] makes clear that the basis of liability, like that of section 324A, accrues when the tortfeasor undertakes to perform services for another which are ‘attended by grave risks’ and which constitute a duty owed by the other to a third person." Seay , 730 S.W.2d at 776. Thus, in Fox , Dallas Hotel Company's liability accrued when it undertook to maintain the elevators for Fox's employer, satisfying subsection 324A(b) of the Restatement. See Fox , 240 S.W. at 518–21. In addition, Dallas Hotel Company had negligently failed to exercise ordinary care in maintaining the elevators, increasing the risk that Fox would be killed by an elevator the Hotel Company had undertaken to maintain, satisfying subsection (a) of section 324A. See id. Both Fox and his employer had relied on the elevators' being properly maintained as Dallas Hotel Company had promised, satisfying subsection (c) of section 324A. See id. Thus, all three alternative bases of Dallas Hotel Company's liability to a third person for negligently performing its assumed duty were satisfied. See id.

The Seay court emphasized that " Section 323 [of the Restatement (Second) of Torts] is identical to section 324A except that the duty delineated in section 323 extends to the person for whom the services were rendered rather than to the third party described in section 324A." Seay , 730 S.W.2d at 776. It then further opined, "This distinction will not impede recognition of section 324A as law inasmuch as Texas courts have repeatedly recognized that existence of a duty will not be defeated by the fact that the duty is claimed by a third party not in privity with the transaction giving rise to the tort." Id. (citing Texas Supreme Court and appellate court cases). The court concluded, "The adoption of section 323 necessarily implies the validity of section 324A as Texas law." Id. at 777 (citing, among others, City of Denton v. Van Page , 701 S.W.2d 831, 836 (Tex. 1986) ).

The Seay court set out the proof required to establish liability for a negligent undertaking claim under section 324A of the Restatement. Id. at 778. Specifically,

Mrs. Seay [the plaintiff] must first show that Travelers [the defendant] undertook to render services to Gaston [the party for whom Travelers undertook an obligation to render services] and then must show at least one of the following three things: (1) that the risk of harm to Seay [the injured party] increased due to the failure of Travelers to exercise reasonable care; (2) that Travelers undertook to perform a duty owed to Seay by Gaston; or (3) that the harm suffered by Seay was the result of his reliance or Gaston's reliance on the services rendered to Gaston by Travelers.

Id. This is the law that is pertinent here.

In 2013, in Nall v. Plunkett , the Texas Supreme Court reaffirmed that section 324A provides the rule for liability to a third person for negligent performance of an undertaking. 404 S.W.3d 552, 555–56 (Tex. 2013). The issue in Nall was whether the Nalls (hosts at a party) owed a duty to protect a guest, Plunkett, who was injured trying to prevent another guest from driving drunk after leaving the party. Id. at 554. The supreme court ultimately found no such duty in that case, but the case is important for its analysis of Plunkett's claims, which is applicable here where the injury from negligent undertakings was to a third party, Emily Bauer. See id. at 555–56.

The supreme court construed Plunkett's petition as alleging both a negligent undertaking claim and a premises liability claim, but it explored only the negligent undertaking claim. Id. at 555–57. The supreme court stated, "The critical inquiry concerning the duty element of a negligent-undertaking theory is whether a defendant acted in a way that requires the imposition of a duty where one otherwise would not exist." Id. at 555. It cited Torrington as holding "that a jury submission for a negligence claim predicated on a negligent-undertaking theory requires a broad-form negligence question accompanied by instructions detailing the essential elements of an undertaking claim." Id. (citing Torrington , 46 S.W.3d at 838–39 ).

Citing Restatement section 324A as "providing the rule for liability to a third person for negligent performance of an undertaking," the court continued,

[T]he broad-form submission for a typical negligence claim and a negligent-undertaking claim is the same, except that an undertaking claim requires the trial court to instruct the jury that a defendant is negligent only if: (1) the defendant undertook to perform services that it knew or should have known were necessary for the plaintiff's protection; (2) the defendant failed to exercise reasonable care in performing those services; and either (a) the plaintiff relied upon the defendant's performance, or (b) the defendant's performance increased the plaintiff's risk of harm.

Id. at 555–56. This is the law determinative of Gulshan's liability in this case.

Application of the Law of Negligent Undertaking to This Case

This case is essentially identical to Seay in that the controlling issue is the duty of protection owed to a third person by a party that has assumed a duty of reasonable care in performing services under a contract with another that it knows or should know are necessary for the protection of a third party—the third party here being, the members of the community and customers of the Handi-Stop, including Emily Bauer.

Because this is a summary judgment case, and not, at this stage, a jury trial, Gulshan was required to disprove at least one element of Bauer's negligent undertaking claim as a matter of law, or, alternatively, Bauer was required to raise a material fact issue as to each challenged element of her negligent undertaking claim. See Lightning Oil Co. v. Anadarko E&P Onshore, LLC , 520 S.W.3d 39, 45 (Tex. 2017). I would hold that Gulshan failed to bear its burden and that Bauer has borne hers.

To avoid summary judgment in favor of Gulshan on her negligent undertaking claim under Restatement (Second) of Torts section 324A, adopted by Fox, Seay , and Nall , Bauer was required to raise a genuine issue of material fact as to whether, under the BMA, Gulshan assumed a duty to render services to ConocoPhillips to "complement the community and the environment," including a duty not to permit "the sale or use of illegal drugs or drug paraphernalia" on the premises of the Phillips 66 station and the Handi-Stop and whether it assumed a duty to "take reasonable steps to ensure that the operators of each Marketer Supplied Outlet, its Marketer Supplied Dealers, its employees, vendors, contractors, and agents cooperate fully" with its performance of its obligation not to permit the sale of illegal drugs on the premises. That Gulshan did assume these duties is shown by the plain language of the BMA. Accordingly, I would hold that Gulshan expressly assumed a duty of reasonable care not to permit the sale of illegal drugs on the premises in the BMA. And I would further hold that Bauer has raised a material fact issue as to whether Gulshan breached its assumed duties.

Specifically, Gulshan promised in the BMA to ensure that the Handi-Stop's owners and operators did "not engage, permit, or cooperate in any conduct that reflects unfavorably on the reputation of ConocoPhillips in the community served by [Gulshan], or in ConocoPhillips' opinion impairs the goodwill associated with the ConocoPhillips Brands ...." And Gulshan signed off on Section 5(J) of the BMA, which affirmatively stated,

Marketer [Gulshan] specifically understands and agrees that the Brand and Image Standards are reasonable and of material significance to this Agreement and to the consumers who patronize Marketer Supplied Outlets [here, the Handi-Stop ]. Marketer further understands and will ensure that its Marketer Supplied Dealers [here, Bin] understand and acknowledge that it is reasonable for ConocoPhillips to debrand any Marketer Supplied Outlet which does not comply with this Section 5, or to terminate this Agreement in its entirety where the violation involves multiple Marketer Supplied Outlets, upon written notice ....

Gulshan clearly did not establish as a matter of law that it had not undertaken to render services to ConocoPhillips which it should have recognized as necessary for the protection of the community served by the Handi-Stop and the Handi-Stop's customers when it agreed in the BMA not to permit or cooperate in any conduct that failed to "complement the community" or that reflected unfavorably on the reputation of ConocoPhillips or that impaired ConocoPhillips' goodwill in the community, including not permitting the sale of illegal drugs and drug paraphernalia at the Handi-Stop. Rather, the evidence establishes the opposite. And Gulshan expressly recognized in the BMA that the Brand and Image Standards it failed to maintain here were "of material significance" to its agreement with ConocoPhillips and the consumers who patronized the Handi-Stop.

Gulshan affirmatively acknowledged its undertaking not to permit the sale of illegal drugs like synthetic marijuana and drug paraphernalia on the premises of the Handi-Stop, an undertaking that it knew or should have known was necessary to protect the community and the customers of the HandiStop from the grave physical danger those products posed—and that were actually inflicted on Emily Bauer—and thus to prevent harm to ConocoPhillips' reputation and goodwill. Gulshan likewise was apprised by the BMA that, if it failed to perform its undertaking not to permit such sales on the premises of the HandiStop, ConocoPhillips could take action, including severe action, such as debranding the service station and the Handi-Stop and, in the case of multiple violations, terminating its contract with Gulshan, thereby protecting both the community and its own reputation. Gulshan expressly assumed a duty, as ConocoPhillips' agent, to protect the customers of service stations and convenience stores branded with ConocoPhillips' name from the dangers resulting from the sale of illegal drugs and drug paraphernalia on its premises by executing the BMA. Had Gulshan not assumed this duty, ConocoPhillips itself or another of its agents would have had to undertake this duty to ensure protection of the community and customers of the Handi-Stop and, thereby, to protect its own reputation and good will. Accordingly, I would hold that the duty assumed and neglected by Gulshan met the requirements of subsection (b) of Restatement section 324A and of Nall, Fox , and Seay.

The BMA also established Gulshan's duty under subsection (c) of Restatement section 324A, because ConocoPhillips relied on Gulshan's contractual undertaking to ensure that illegal drugs and drug paraphernalia would not be sold at the Handi-Stop, thus forbearing from taking action to do so itself. See RESTATEMENT (SECOND) OF TORTS § 324A cmt. e ("The actor is also subject to liability to a third person where the harm is suffered because of the reliance of the other for whom he undertakes to render the services, or of the third person himself, upon his undertaking. This is true whether or not the negligence of the actor has created any new risk or increased an existing one. Where the reliance of the other, or of the third person, has induced him to forgo other remedies or precautions against such a risk, the harm results from the negligence as fully as if the actor had created the risk.").

And finally, with regard to subsection 324A(a), Gulshan failed to meet its burden to show, as a matter of law, that its failure to ensure Handi-Stop #79's compliance with ConocoPhillips' mandatory Brand and Image Standards—including the Handi-Stop's compliance with the standard prohibiting the sale of illegal drugs or drug paraphernalia on its premises—did not result in increased risk of grave bodily harm to teenagers frequenting the store, like Emily Bauer. See Seay , 730 S.W.2d at 775–76 ("One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of a third person or his things, is subject to liability to the third person for physical harm resulting from his failure to exercise reasonable care to [perform] his undertaking, if ... his failure to exercise reasonable care increases the risk of [such] harm ....") (quoting RESTATEMENT (SECOND) OF TORTS § 324A ). Gulshan's failure to perform its undertaken duty plainly increased the risk of physical harm to Emily and other young customers of the Handi-Stop by permitting them access to dangerous illegal drugs unavailable at any other store in the community. And there is clearly a material fact issue as to whether the purchase and use of those drugs resulted from Gulshan's breach of its duty of reasonable care and directly caused Emily to have the massive strokes and a heart attack that caused her catastrophic harm.

As to proof of the remaining elements of her negligence cause of action, clearly Bauer's evidence—including evidence that "bags or brands of synthetic marijuana, such as Kush, Klimax, Cloud 9 and Dopey, were taped to the inside of the dividing window by the cash register so customers could see what was available for purchase"; that Handi-Stop #79 prominently labeled itself as a "smoke shop"; that other drug paraphernalia, including bongs, pipes, and grinders, was in plain sight by the cash register at all times; and that this was the case on December 7, 2012, when Emily and her friends visited the store and purchased one package of "Kush" synthetic marijuana and one package of "Klimax"—raised a material fact issue regarding whether Gulshan breached its duty of care by failing to take reasonably prudent measures to remedy these blatant violations of ConocoPhillips' Brand and Image Standards, and whether such breach proximately caused Emily's injuries.

I would hold as a matter of law that Gulshan assumed a duty of reasonable care under the BMA not to permit the sale of harmful and illegal drugs and drug paraphernalia on the premises of the ConocoPhillips service station and Handi-Stop #79. And I would hold that Bauer has raised a material fact issue as to whether Gulshan performed that duty negligently, proximately causing harm to Emily Bauer.

I would hold, therefore, that Gulshan has failed to disprove as a matter of law any of the elements of Bauer's negligent undertaking claim and that, conversely, Bauer has clearly raised material fact issues with respect to all elements of her claim.

I would sustain Bauer's sole issue.

Conclusion

I would reverse the trial court's judgment and remand the case for trial on the merits of Bauer's negligent undertaking claim.

OPINION ON REHEARING

Sherry Radack, Chief Justice

Appellant, Tonya Bauer, as guardian of the person and the estate of Emily Bauer, an incapacitated person ("Bauer"), filed a motion for rehearing and for en banc reconsideration of our opinion issued on February 27, 2020. We deny the motion for rehearing, but withdraw our opinion and judgment, and substitute this opinion and judgment in their stead. Because we issue a new opinion in connection with the denial of rehearing, the motion for en banc reconsideration of our prior opinion is moot.

The term "synthetic cannabinoid," commonly called "synthetic marihuana," refers to a class of chemical compounds created to mimic the effects of tetrahydrocannabinol (THC), the psychoactive constituent of the marihuana plant. Synthetic cannabinoids are man-made, unregulated chemicals produced in underground labs, often overseas, and then shipped to the United States in powdered or crystal form. The chemicals are then mixed with acetone and manually sprayed onto plant material before packaging. As laws are enacted making it illegal to sell, buy, or possess certain chemicals, manufacturers simply alter their formulas. As a result, the composition of many of these products, some of which contain lethal contaminants, is largely unknown, making it difficult for healthcare professionals to diagnose and treat patients in emergency cases involving these substances.

For several years, synthetic cannabinoids have been sold in convenience stores, novelty stores, and over the internet. They are marketed in colorful packages to attract young consumers. Currently, sixty percent of individuals admitted to Texas emergency rooms for treatment related to synthetic-cannabinoid use are between the ages of 12 and 20. This is such a case.

Here, a teenage girl suffered debilitating, permanent injuries after using synthetic marihuana that a friend obtained from a convenience store. Appellant, Tonya Bauer, as guardian of the person and the estate of Emily Bauer, an incapacitated person ("Bauer"), brought negligence claims against the convenience-store owner, the lessee, and the entities that supplied the convenience store gas pumps with gasoline. In this appeal, Bauer challenges the trial court's summary judgment in favor of the gasoline distributor, appellee, Gulshan Enterprises, Inc. ("Gulshan"). In her sole issue, Bauer contends that the trial court erred in granting summary judgment for Gulshan, and denying her motion for reconsideration, because she presented evidence raising genuine issues of material fact. Because we conclude that there is simply no evidence to support the duty element of Bauer's negligence claim against the gasoline distributor, we affirm the trial court's judgment.

Background

ConocoPhillips Company ("ConocoPhillips") is engaged in the production, refining, and marketing of petroleum products under various brands. Gulshan is a wholesale distributor of motor vehicle fuels to independent dealers ("dealers") and to retail outlets, i.e., gas stations. On March 1, 2010, ConocoPhillips and Gulshan entered into a supply agreement, the "Branded Marketer Agreement" ("BMA"). Under its terms, ConocoPhillips agreed to sell gasoline to Gulshan, as "Marketer," for resale to Gulshan's customers. The BMA authorized Gulshan to sell ConocoPhillips-branded gasoline through stations it owns or operates and to sell gasoline to independent dealers who own or operate such stations.

In the BMA, ConocoPhillips also granted Gulshan a license to use certain ConocoPhillips brand names in the advertising, distribution, and sale of gasoline and to display ConocoPhillips brand identification and signage at the stations Gulshan supplied. Noting that ConocoPhillips had a protectable business interest in ensuring that Gulshan's sales and distributions would be accomplished in a manner respecting the standards, reputation, and integrity of the ConocoPhillips brands, the BMA set out certain "Brand and Image Standards," discussed below, with which Gulshan was required to comply. Gulshan was also required to ensure to ConocoPhillips that each of the dealers and gas stations that it supplied also complied. The parties agreed that the BMA was "personal to [Gulshan]" and for the sole use and benefit of Gulshan and ConocoPhillips. The parties agreed that, in the event that Gulshan failed to comply, or to ensure compliance, with the Brand and Image Standards, ConocoPhillips could assess fees against Gulshan, "debrand" the gas station, or terminate the BMA.

On January 31, 2012, Gulshan executed a Marketing Contract with an independent dealer, Bin Enterprises Inc. ("Bin"). Also on that day, Bin purchased from Global New Millennium Partners, Ltd. a convenience store and gas station located at 11150 Huffmeister Road in Houston, known as Handi-Stop #79 ("Handi-Stop"). Under the terms of the Marketing Contract, Gulshan agreed to supply Bin with ConocoPhillips gasoline, branded as "Phillips 66," at Bin's locations, including Handi-Stop. And, Bin agreed to operate in accordance with the standards of Gulshan and its supplier. In the Marketing Contract, the parties expressly agreed that Gulshan was to have no right of control over Bin's operation of its businesses, including Handi-Stop. In October 2012, Bin leased Handi-Stop to Khalid Khan.

During the fall of 2012, Shawn Kettlewell and Emily Bauer were sophomores in high school. According to Shawn, he and Emily frequently smoked marihuana together and, on occasion, they used cocaine, Xanax, and ecstasy. On December 7, 2012, they skipped school and smoked marihuana periodically throughout the day. Late that afternoon, a friend, Anserra Dupree, Jr., went to Handi-Stop and purchased synthetic marihuana, specifically, one bag of "Kush" and one bag of "Klimax." Shawn, Emily, and Anserra then gathered with friends and smoked approximately half of the contents of each bag. According to Anserra, Emily generally "added other things when she smoked."

After smoking synthetic marihuana at around 7:00 p.m., Emily began feeling dizzy and had a headache. She took prescribed medication and went to sleep. When she awoke 15 minutes later, she began mumbling, screaming, and throwing things. After she bit Shawn, he called for emergency assistance. Emily was taken by ambulance to North Cypress Medical Center. Shawn discarded the remaining portions of the synthetic marihuana that he and Emily had smoked.

At the hospital, Emily was disoriented, screamed for people who were not there, thrashed violently, and bit the siderails of her bed. According to the medical evidence, Emily exhibited clinical signs and symptoms consistent with synthetic cannabinoid toxicity. She was placed in a medically-induced coma and on a ventilator. She suffered multiple ischemic strokes and was diagnosed with primary central nervous system vasculitis. She developed quadriparesis, cortical visual impairment, and a seizure disorder. Emily spent months in the hospital and underwent therapy before returning home. Emily's medical issues are ongoing. She requires near constant supervision and requires assistance to perform basic tasks. The cost of caring for Emily for the rest of her life is estimated to be between $10,822.665.99 and $12,262,949.30.

Bauer, Emily's mother, brought claims against "Phillips 66 Company," Gulshan, Bin, and Khan for products liability, negligence, fraud, breach of implied warranty of merchantability, and intentional infliction of emotional distress. The trial court granted summary judgment in favor of Phillips 66 Company, dismissing Bauer's claims against it. The trial court also granted summary judgment in favor of Gulshan on Bauer's products-liability claims. Bauer non-suited all of her other claims, except her negligence claim. The trial court severed Bauer's negligence claim against Gulshan from her claims against Bin and Khan. This appeal concerns only Bauer's negligence claim against Gulshan.

In her negligence claim against Gulshan, Bauer alleged that Gulshan owed Emily a duty of reasonable care not to create an unreasonable risk of harm. She asserted that the BMA assigned contractual duties to Gulshan to monitor and inspect the activities at Handi-Stop to ensure that the "sale or use of illegal drugs or drug paraphernalia [did] not occur." And, Gulshan breached these duties by failing to perform its duties of monitoring and inspecting the store. She asserted that, although Gulshan apparently conducted some type of inspections of Handi-Stop, Gulshan did not perform inspections inside the retail store after January 31, 2012, and such failure to exercise reasonable care proximately caused Emily's harm. Bauer further asserted that Gulshan's conduct constituted a "negligent undertaking" giving rise to a duty to Emily because it performed services that it knew, or should have known, were necessary for her protection. Bauer asserted that Gulshan failed to exercise reasonable care in performing those services, that Emily suffered harm based on her reliance on Gulshan's performance, and that Gulshan's performance increased Emily's risk of harm.

Bauer also alleged that Gulshan was vicariously liable for the negligence of Bin and Khan. She asserted that "Gulshan was the owner/operator of Handi-Stop," that Bin and Khan acted as Gulshan's agents, and that Bin and Khan negligently performed their duties to monitor and inspect the store. Bauer further alleged that Gulshan was grossly negligent.

Gulshan filed a combined motion for traditional and no-evidence summary judgment on Bauer's negligence claim. Gulshan argued that it was entitled to judgment as a matter of law because the trial court had previously granted summary judgment in favor of Gulshan on Bauer's products-liability claims, and Bauer had simply recast her products-liability claims as an artfully plead negligence claim.

Gulshan further argued, as pertinent here, that there was no evidence that it "breached any duty allegedly owed to Emily or that its conduct caused [her] harm." Gulshan did not own or operate Handi-Stop, had no contractual right to control Handi-Stop, and did not exercise any control over it. In addition, there was no evidence that it undertook to perform any services, failed to exercise reasonable care in performing any services, that Emily suffered harm based on her reliance on Gulshan, or that Gulshan's performance increased Emily's risk of harm.

In her summary-judgment response, Bauer argued that Gulshan owed Emily a duty of reasonable care based on its contractual duties under the BMA. She asserted that, "[u]nder the BMA, Gulshan held the right to (1) control activities taking place on the premises where Emily's injuries arose, (2) inspect the premises for offensive and illegal activities, and (3) direct the conduct of those working on or around the premises." Bauer asserted that the BMA "alerted Gulshan and put them on notice to criminal risks that were attendant to this type of business." And, "[t]o that end, the BMA assigned Gulshan a duty—and Gulshan undertook that duty—to prevent the ‘sale or use of illegal drugs or drug paraphernalia’ at any of the Phillips 66-branded fuel stations it serviced including Handi-Stop." Bauer asserted that there was substantial evidence that Gulshan "controlled the activities on the premises, failed to exercise reasonable care in the exercise of that control, and, as a direct result," Emily was injured.

As her summary-judgment evidence, discussed below, Bauer presented the BMA, the Marketing Contract, a photograph of packages of synthetic marihuana, and various letters. She also attached excerpts of her deposition, the transcript of a recorded statement of Anserra, and the depositions of Shawn, Shoukat Dhanani (president of Gulshan), and Salman Bin Hameed (president of Bin). Bauer also attached medical records, medical expert reports, and excerpts of the depositions of Drs. Greg Andres and Jeff Lapoint.

After a hearing, trial court granted summary judgment in favor of Gulshan without specifying the grounds and dismissed Bauer's claim against it. Bauer filed a motion for reconsideration, again arguing that the summary-judgment evidence presented issues of fact. The trial court denied Bauer's motion for reconsideration.

Summary Judgment

In her sole issue, Bauer argues that the trial court erred in granting Gulshan's motion for no-evidence summary judgment on her negligence claim, under both simple-negligence and negligent-undertaking theories, because she presented more than a scintilla of evidence on each of the challenged elements of her claim. See TEX. R. CIV. P. 166a(i). Bauer argues that the trial court erred in granting Gulshan's motion for traditional summary judgment on her negligence claim because Gulshan did not conclusively establish that she simply recast her products-liability claim as a negligence claim. See TEX. R. APP. P. 166a(c). She further asserts that the trial court erred in denying her motion for reconsideration on the same grounds. A. Standard of Review

We review a trial court's summary judgment de novo. Valence Operating Co. v. Dorsett , 164 S.W.3d 656, 661 (Tex. 2005). In conducting our review, we take as true all evidence favorable to the non-movant, and we indulge every reasonable inference and resolve any doubts in the non-movant's favor. Id. If a trial court grants summary judgment without specifying the grounds for granting the motion, we must uphold the trial court's judgment if any of the asserted grounds are meritorious. Beverick v. Koch Power, Inc. , 186 S.W.3d 145, 148 (Tex. App.—Houston [1st Dist.] 2005, pet. denied).

A party seeking summary judgment may combine in a single motion a request for summary judgment under both the traditional and no-evidence standards. Binur v. Jacobo , 135 S.W.3d 646, 650–51 (Tex. 2004). When a party seeks summary judgment on both grounds in the trial court and the trial court's order does not specify its reasons for granting summary judgment, we first review the propriety of the summary judgment under the no-evidence standard. See Ford Motor Co. v. Ridgway , 135 S.W.3d 598, 600 (Tex. 2004) ; see also TEX. R. CIV. P. 166a(i). If we conclude that the trial court did not err in granting summary judgment under the no-evidence standard, we need not reach the issue of whether the trial court erred in granting summary judgment under the traditional standard. See Ford Motor Co. , 135 S.W.3d at 600 ; see also TEX. R. CIV. P. 166a(c).

To prevail on a no-evidence summary-judgment motion, the movant must establish that there is no evidence to support an essential element of the non-movant's claim on which the non-movant would have the burden of proof at trial. See TEX. R. CIV. P. 166a(i) ; Hahn v. Love , 321 S.W.3d 517, 523–24 (Tex. App.—Houston [1st Dist.] 2009, pet. denied). The burden then shifts to the non-movant to present evidence raising a genuine issue of material fact as to each of the elements challenged in the motion. Mack Trucks, Inc. v. Tamez , 206 S.W.3d 572, 582 (Tex. 2006). A no-evidence summary judgment may not be granted if the non-movant brings forth more than a scintilla of evidence to raise a genuine issue of material fact on the challenged elements. See Ridgway , 135 S.W.3d at 600. More than a scintilla of evidence exists when the evidence "rises to a level that would enable reasonable and fair-minded people to differ in their conclusions." Merrell Dow Pharms., Inc. v. Havner , 953 S.W.2d 706, 711 (Tex. 1997).

In a traditional motion for summary judgment, the movant has the burden to establish that no genuine issue of material fact exists and that it is entitled to judgment as a matter of law. See TEX. R. CIV. P. 166a(c) ; KPMG Peat Marwick v. Harrison Cty. Hous. Fin. Corp. , 988 S.W.2d 746, 748 (Tex. 1999). When a defendant moves for a traditional summary judgment, it must either: (1) disprove at least one essential element of the plaintiff's cause of action or (2) plead and conclusively establish each essential element of an affirmative defense, thereby defeating the plaintiff's cause of action. See Cathey v. Booth , 900 S.W.2d 339, 341 (Tex. 1995). Once the movant meets its burden, the burden shifts to the non-movant to raise a genuine issue of material fact precluding summary judgment. Centeq Realty, Inc. v. Siegler , 899 S.W.2d 195, 197 (Tex. 1995). The evidence raises a genuine issue of fact if reasonable and fair-minded jurors could differ in their conclusions in light of all of the summary-judgment evidence. Goodyear Tire & Rubber Co. v. Mayes , 236 S.W.3d 754, 755 (Tex. 2007). Generally, we restrict the scope of our review of a trial court's ruling on a motion for summary judgment to that evidence that was before the trial court at the time that it ruled on the motion. Neely v. Comm'n for Lawyer Discipline , 302 S.W.3d 331, 347 n.16 (Tex. App.—Houston [14th Dist.] 2009, pet. denied) ; see also TEX. R. CIV. P. 166a(d). "When a motion [to reconsider] is filed after the rendition of summary judgment, a trial court has the discretion to consider the grounds in [the] post-judgment motion and supporting proof[,] and reaffirm its summary judgment based on the entire record." Charbonnet v. Shami , No. 04-12-00711-CV, 2013 WL 2645720, at *5 (Tex. App.—San Antonio June 12, 2013, pet. denied) (mem. op.) (internal quotations omitted). "The trial court also has the discretion to simply deny a motion filed after the entry of summary judgment without considering its substance." Id. "In the latter situation, an appellate court need only consider arguments and evidence presented prior to the summary-judgment hearing." Id.

When, as here, however, the trial court's order affirmatively states that it considered the evidence attached to a motion to reconsider, we review the summary judgment based on the grounds and proof in both the prejudgment and post-judgment filings. Timothy Patton, Summary Judgments in Texas § 7.06[1] (3d ed. 2013); see also Circle X Land & Cattle Co., Ltd. v. Mumford Ind. Sch. Dist. , 325 S.W.3d 859, 863 (Tex. App.—Houston [14th Dist.] 2010, pet. denied) (reviewing evidence attached to motion to reconsider because order reflected that trial court considered such evidence); Stephens v. Dolcefino , 126 S.W.3d 120, 134 (Tex. App.—Houston [1st Dist.] 2003, no pet.) (considering evidence offered at hearing on motion to reconsider because trial court ruled that it would consider such evidence); cf. McMahan v. Greenwood , 108 S.W.3d 467, 500 (Tex. App.—Houston [14th Dist.] 2003, pet. denied) (declining to consider evidence attached to motion for new trial because trial court's order did not state that it considered such evidence).

B. Legal Principles

The common-law doctrine of negligence consists of: (1) a legal duty owed by one person to another, (2) a breach of that duty, and (3) damages proximately resulting from the breach. Praesel v. Johnson , 967 S.W.2d 391, 394 (Tex. 1998). The threshold inquiry is the existence of a duty. Id. A duty is a "legally enforceable obligation to comply with a certain standard of conduct." Hand v. Dean Witter Reynolds, Inc. , 889 S.W.2d 483, 491 (Tex. App.—Houston [14th Dist.] 1994, writ denied). "Texas law generally imposes no duty to take action to prevent harm to others absent certain special relationships or circumstances." Torrington Co. v. Stutzman , 46 S.W.3d 829, 837 (Tex. 2000) (citing Restatement (Second) of Torts § 314 (1965) ("The fact that [an] actor realizes or should realize that action on his part is necessary for another's aid or protection does not of itself impose upon him a duty to take such action.")).

Special relationships include those existing between employer and employee, parent and child, and independent contractor and contractee. Greater Hous. Transp. Co. v. Phillips , 801 S.W.2d 523, 525 (Tex. 1990) ; see also Golden Spread Council, Inc. v. Akins , 926 S.W.2d 287, 289–90, 292 (Tex. 1996) ("There are some cases in which a duty exists as a matter of law because a special relationship exists between the parties. In such cases, the duty analysis ends there.").

"It is firmly established in Texas that the existence and elements of a common law duty are ordinarily legal issues for the court to decide...." Humble Sand & Gravel, Inc. v. Gomez , 146 S.W.3d 170, 181 (Tex. 2004). Because the existence of a legal duty is a question of law, we apply a de novo standard of review. Alcoa, Inc. v. Behringer , 235 S.W.3d 456, 460 (Tex. App.—Dallas 2007, pet. denied). In deciding whether to impose a duty, a court must balance the risk, foreseeability, and likelihood of injury against the social utility of the actor's conduct, the magnitude of the burden of guarding against the injury, and the consequences of placing the burden on the defendant. Humble Sand & Gravel , 146 S.W.3d at 182. Courts also consider whether one party "would generally have superior knowledge of the risk or a right to control the actor who caused the harm." Id.

"The critical inquiry concerning the duty element of a negligent-undertaking theory is whether a defendant acted in a way that requires the imposition of a duty where one otherwise would not exist." Nall v. Plunkett , 404 S.W.3d 552, 555 (Tex. 2013) (emphasis added). "[O]ne who voluntarily undertakes an affirmative course of action for the benefit of another has a duty to exercise reasonable care that the other's person or property will not be injured thereby." Fort Bend Cty. Drainage Dist. v. Sbrusch , 818 S.W.2d 392, 395 (Tex. 1991) (quoting Colonial Sav. Ass'n v. Taylor , 544 S.W.2d 116, 119–20 (Tex. 1976) ). With respect to liability to a third person, the Restatement (Second) of Torts section 324A, "Liability to Third Person for Negligent Performance of Undertaking," provides:

One who undertakes , gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of a third person or his things, is subject to liability to the third person for physical harm resulting from his failure to exercise reasonable care to [perform] his undertaking, if

(a) his failure to exercise reasonable care increases the risk of such harm, or

(b) he has undertaken to perform a duty owed by the other to the third person, or

(c) the harm is suffered because of reliance of the other or the third person upon the undertaking.

RESTATEMENT (SECOND) OF TORTS § 324A (1965) (emphasis added).

In its most recent case discussing section 324A, the Texas Supreme Court stated that "an undertaking claim requires the trial court to instruct the jury that a defendant is negligent only if: (1) the defendant undertook to perform services that it knew or should have known were necessary for the plaintiff's protection; (2) the defendant failed to exercise reasonable care in performing those services; and either (a) the plaintiff relied upon the defendant's performance, or (b) the defendant's performance increased the plaintiff's risk of harm." Nall , 404 S.W.3d at 555–56 (emphasis added) (citing Torrington Co. , 46 S.W.3d at 838–39 and RESTATEMENT (SECOND) OF TORTS § 324A (providing rule for liability to third person for negligent performance of undertaking)).

Thus, a duty arises if the defendant affirmatively undertakes to perform services upon which reliance can be based. See id. (citing Osuna v. S. Pac. R.R. , 641 S.W.2d 229, 230 (Tex. 1982) ("Having undertaken to place a flashing light at the crossing for the purpose of warning travelers, the railroad was under a duty to keep the signal in good repair, even though the signal was not legally required.")). "A mere promise to render a service coupled with neither performance nor reliance imposes no tort obligation upon the promisor." Fort Bend Cty. Drainage Dist. , 818 S.W.2d at 396.

C. Analysis

Here, Gulshan, in its summary-judgment motion, argued that there is no evidence that it "breached any duty allegedly owed to Emily or that its conduct caused [her] harm." See TEX. R. APP. P. 166a(i). Thus, Gulshan challenged each of the elements of Bauer's negligence claim. See Lampasas v. Spring Ctr., Inc. , 988 S.W.2d 428, 436 (Tex. App.—Houston [14th Dist.] 1999, no pet.) ; see also TEX. R. CIV. P. 71 (providing that courts are to give effect to substance of motion rather than title or form); In re J.Z.P. , 484 S.W.3d 924, 925 (Tex. 2016).

Gulshan further argued that there is no evidence that it undertook any action that caused Emily's harm. Specifically, there is no evidence that Gulshan performed services that it knew or should have known were necessary for Emily's protection; that it failed to exercise reasonable care in performing any such services; or either that Emily's reliance upon Gulshan's performance caused her injury or that Gulshan's alleged performance increased Emily's harm. See TEX. R. APP. P. 166a(i); Nall , 404 S.W.3d at 555–56.

Bauer, in her summary-judgment response, with respect to the duty element of her claim, argued that Gulshan owed Emily a duty of reasonable care based on (1) Gulshan's contractual duties under the BMA and control over Handi-Stop (simple-negligence theory) and (2) having affirmatively undertaken to inspect and monitor Handi-Stop (negligent-undertaking theory).

1. Simple Negligence

Bauer first argued that the BMA assigned a contractual duty to Gulshan to "prevent the ‘sale or use of illegal drugs or drug paraphernalia’ at any of the Phillips 66-branded outlets it serviced including Handi-Stop." And, Gulshan agreed to maintain "extensive control" over Handi-Stop. Thus, Gulshan assumed a duty to Emily, arising in tort, to exercise reasonable care in inspecting and monitoring the store.

The BMA provides that ConocoPhillips had a protectable business interest in ensuring that Gulshan's distribution of branded products was accomplished in a manner consistent with ConocoPhillips' standards, reputation, and integrity. Thus, section 5 of the BMA, "Brand and Image Standards," requires that Marketers, i.e., Gulshan, and its Marketer Supplied Outlets, i.e., Handi-Stop, uphold certain standards reflecting on the reputation of ConocoPhillips. These include treating all persons fairly, honestly, and courteously; providing efficient service to consumers; properly addressing consumer complaints; keeping the building and grounds clean; operating with well-groomed personnel; and operating during certain business hours. In addition, section 5(D), on which Bauer relies, provides:

Consistent with the principles herein set forth, ... Marketer [Gulshan] shall conduct its independent business operations in compliance with the standards set forth below, which will promote the continuing good reputation of ConocoPhillips and all other branded ConocoPhillips marketers. [Gulshan] shall ensure to ConocoPhillips that all Marketer Supplied Outlets [such as Handi-Stop] and the Marketer Supplied Dealers [Bin] shall also comply with these standards.

....

(D) Each Marketer Supplied Outlet [Handi-Stop] must complement the community and the environment. Furthermore, [Handi-Stop] must not engage, permit, or cooperate in

any conduct that reflects unfavorably on the reputation of ConocoPhillips in the community served by [Gulshan], or in ConocoPhillips' opinion impairs the goodwill associated with the ConocoPhillips.... [Gulshan] shall cooperate, and shall take reasonable steps to ensure that the operators of [Handi-Stop] ... its employees, vendors, contractors, and agents cooperate fully with the performance of [Gulshan's] obligations under this [BMA].... [Gulshan] shall not permit on, in[,] or from [Handi-Stop]:

i. price gouging ...;

ii. any illegal consumption of intoxicating beverages;

iii. the sale or use of illegal drugs or drug paraphernalia ;

iv. the sale of tobacco ... or alcoholic beverages to minors ...;

v. any offensive merchandise....

(Emphasis added.) Thus, under the BMA, in order to protect the reputation and goodwill of ConocoPhillips, Gulshan had a duty to ensure ConocoPhillips that the gas stations it serviced, such as Handi-Stop, cooperated and complied with ConocoPhillips's standards, such as prohibiting the sale of illegal drugs or drug paraphernalia.

Bauer argued that Gulshan owed these duties to Emily based on the following language in section 5: "Marketer specifically understands and agrees that the Brand and Image Standards are reasonable and of material significance to this Agreement and to the consumers who patronize Marketer Supplied Outlets...." The BMA reflects, however, that it constitutes an agreement between ConocoPhillips and Gulshan, and section 36 expressly provides: "This agreement is personal to [Gulshan] and is intended for the sole use and benefit of [Gulshan] and ConocoPhillips. No Marketer Supplied Dealer or any other third party is a third party beneficiary under this Agreement."

To ensure compliance with the "Brand and Image Standards," section 5 requires that Handi-Stop participate, at Gulshan's expense, in the ConocoPhillips "Brand and Image Standards Program." Section 5 provides that evaluations of Handi-Stop's compliance with the Brand and Image Standards "shall be communicated through an evaluation form completed by ConocoPhillips or its designee." (Emphasis added.) Section 5 provides that, in the event that Handi-Stop failed an evaluation, ConocoPhillips was to give written notice to Gulshan. Then, Gulshan was required to contact the gas station and ensure that the deficiency was corrected. The remedy for any failure to uphold the Brand and Image Standards was for ConocoPhillips to assess fees against Gulshan, to "debrand" Handi-Stop of its Phillips 66 affiliation, or to terminate the BMA.

Thus, the BMA assigns the duty to inspect Handi-Stop for compliance with the Brand and Image Standards to ConocoPhillips, not to Gulshan. Importantly, Bauer expressly states in her appellate brief that "Gulshan was not obligated to inspect stores under the BMA."

Bauer further asserted that Gulshan assumed a duty to Emily, arising in tort, to exercise reasonable care in inspecting and monitoring Handi-Stop because Gulshan agreed to maintain "extensive control" over the store. See Golden Spread Council, Inc. , 926 S.W.2d at 289–90.

It is undisputed, however, that Gulshan did not own or operate Handi-Stop. Rather, as Bauer states in her brief, "[a]t the time of Emily's injury, Bin was the owner and dealer of the [Handi-Stop]." And, the undisputed summary-judgment evidence shows that, at such time, Handi-Stop was leased to and operated by Khan.

Importantly, under the terms of the Marketing Contract between Gulshan and Bin, the parties expressly agreed that Gulshan would have no right of control over Bin's operation of Handi-Stop:

Nothing in this Agreement is intended to make [Bin] and [Gulshan] joint venturers or partners, or otherwise to create a master-servant or principal-agent relationship between [Bin] and [Gulshan]. Neither party shall have the authority to make any commitments whatsoever in the name or on the behalf of the other....

In the performance of this Agreement, Dealer [sic] acknowledges that [Bin] is engaged as an independent business entity and is familiar with the operation and management of the convenience store and service station business, and nothing herein shall be construed as granting [Gulshan] any right to control or direct [Bin] with respect to [Bin's] conduct of such business(es) ....

(Emphasis added.) We further note that Bauer expressly states in her brief that her claim is "not based on theories of agency."

We conclude that Bauer did not present evidence to raise a genuine issue of material fact regarding the duty element of her negligence claim, based on a simple negligence theory. See Ridgway , 135 S.W.3d at 600 ; Havner , 953 S.W.2d at 711.

2. Negligent Undertaking

Bauer asserted, in her summary-judgment response, that Gulshan "undertook duties" to "inspect and monitor the activities" at Handi-Stop. And, "Gulshan was responsible for ‘taking action to correct or improve any deficiencies’ identified during an evaluation." In doing so, Gulshan entered into a contractual agreement to render services at Handi-Stop. Thus, she asserts, Gulshan had a common-law duty to Emily to exercise reasonable care in undertaking its contractual obligations.

With respect to the duty element of her negligent-undertaking claim, Bauer was first required to present evidence that Gulshan "undertook to perform services that it knew or should have known were necessary for [Emily's] protection." See Nall , 404 S.W.3d at 555–56 (emphasis added).

In Fort Bend County Drainage District , the supreme court held that a "mere promise to render a service coupled with neither performance nor reliance imposes no tort obligation upon the promisor." 818 S.W.2d at 396 (emphasis added). There, the District promised a landowner that it would repair any damage caused by the District's use of a bridge on the owner's land. Id. at 393–94. Later, a second party, an easement holder, notified the District that the bridge had become unsafe. Id. at 394. The District promised the easement holder that it would repair the bridge. Id. After months passed without repairs, a third party (member of the public) crossed the bridge in a truck, the bridge collapsed, and the truck fell into the drainage channel. Id. The driver sued the District, arguing that the District, having promised repairs (to the easement holder), had undertaken a duty to repair the bridge. Id. at 395. The supreme court disagreed, concluding that the District's promises alone did not constitute an undertaking of an affirmative course of action and that there was no evidence that the District had taken any affirmative action thereafter. Id. at 396–97. Further, because the District's promises were not communicated to the injured plaintiff, he could not have relied upon them. Id. at 397. And, even though the District had repaired other area bridges in the past, such conduct did not give rise to a duty to act on the occasion at hand. Id. The supreme court held that, "[w]ithout some affirmative course of action beyond the making of a mere promise or without reliance on that promise," the District did not have a duty to the driver with respect to repairs. Id. (emphasis added) (applying Restatement (Second) of Torts, § 324A ).

Similarly, this Court, in Knife River Corporation v. Hinojosa , held that the plaintiff presented no evidence to support her negligent-undertaking claim. 438 S.W.3d 625, 637 (Tex. App.—Houston [1st Dist.] 2014, pet. denied.). There, the Texas Department of Transportation ("Department") contracted with a contractor to resurface a section of highway. Id. at 628. The contract incorporated the Department's standards and required the contractor to give the Department written notice of any latent conditions. Id. at 628–29. During the project, the contractor noted a safety condition in a section of road involving a culvert and a steep drop-off but did not send notice. Id. at 629. Once the project was complete, a Department engineer inspected the work, but the safety issue remained. Id. Subsequently, a motorist was killed when his truck hit the culvert. Id. at 627–29. The driver's spouse sued the contractor for negligent-undertaking, asserting that the contractor had undertaken certain duties under the construction contract for the benefit of third parties, such as the driver. Id. at 629 ("On entering a contract which it should have recognized as necessary to the protection of the public, Knife River [ ] had a duty to exercise reasonable care in the performance of that contract."). Specifically, she alleged, the contractor undertook duties to remedy such road conditions and to make the roadway safe. Id. at 630, 634. This Court, in reviewing the contract, noted that rectifying the road condition was outside the scope of work and that there was no affirmative undertaking. Id. at 630, 637. We held that, because the law imposes a duty to perform without negligence only those tasks that the actor has undertaken to accomplish , the defendant owed no duty to the driver as a matter of law. Id. at 637 (applying Restatement (Second) of Torts, § 324A ).

Here, in her summary-judgment response, Bauer asserts that Gulshan, who is a gasoline supplier, undertook duties to "prevent the sale of drugs and drug paraphernalia at Handi-Stop[ ] which Gulshan did not do. " (Emphasis added.) And, she stated, "Gulshan admits ‘no inspections were conducted as to inside sales inside the retail store from the applicable time period of January 31, 2012 to December 31, 2012.’ "

Thus, Bauer seeks to impose a duty on Gulshan for failing to act, not for the manner in which it affirmatively acted. Again, "[t]he critical inquiry concerning the duty element of a negligent-undertaking theory is whether a defendant acted in a way that requires the imposition of a duty where one otherwise would not exist." Nall , 404 S.W.3d at 555 (emphasis added).

Bauer's evidence includes eight Brand and Image Inspection reports conducted by a representative of Market Force Information, Inc., on behalf of ConocoPhillips/Phillips 66. These include inspections of the Handi-Stop convenience store in February, April, August, and October 2012 (Emily's injury occurred in December 2012). Thus, in accordance with section 5 of the BMA, ConocoPhillips was in fact inspecting Handi-Stop for compliance with the Brand and Image Standards. And, Bauer speculated in her summary-judgment response that "[t]hrough Phillips 66 [ConocoPhillips] inspection reports" it was "more likely than not that Gulshan learned [that] pipes were being sold at the counter." Bauer asserted that "Gulshan was responsible for ‘taking action to correct or improve any deficiencies’ identified during an evaluation." However, no such material is mentioned in any of the ConocoPhillips inspection reports. More importantly, however, this evidence goes to what Gulshan knew or should have known, and not to whether it undertook to perform services. See Nall , 404 S.W.3d at 555–56 (providing, in pertinent part, that, to establish "negligent undertaking," plaintiff must first show that "the defendant undertook to perform services that it knew or should have known were necessary for the [third person's] protection") (citing RESTATEMENT (SECOND) OF TORTS § 324A ("One who undertakes , gratuitously or for consideration, to render services to another....")); Fort Bend Cty. Drainage Dist. , 818 S.W.2d at 397 ; Knife River , 438 S.W.3d at 637.

Bauer also points to a photograph of trash outside the Handi-Stop store and a photograph attached to an inspection report dated March 21, 2014, some 15 months after Emily's injury. Bauer also points to deposition testimony and statements that synthetic marihuana was in fact purchased at Handi-Stop in the months leading up to, and on the day of, Emily's injury. Again, this evidence goes to what Gulshan knew or should have known, and not to whether it affirmatively undertook to perform services. See Nall , 404 S.W.3d at 555–56 ; Fort Bend Cty. Drainage Dist. , 818 S.W.2d at 397 ; Knife River , 438 S.W.3d at 637.

Bauer further asserted that Dhanani's deposition testimony reflects that Gulshan undertook to inspect and "safeguard" the Handi-Stop. The record shows that Dhanani testified that Zafar Tahir inspected stores that Gulshan and its subsidiary "operated," not stores that were leased out. Dhanani testified that, hypothetically, if he were to become aware that any of Gulshan's stores were selling synthetic marihuana, he would have "immediately stopped it." It is undisputed that Gulshan did not own or operate Handi-Stop. Rather, Bin owned the Handi-Stop and leased it to Khan. Dhanani testified that Gulshan generally did inspect stores for which it was "just a supplier of fuel," and he discussed how he "assum[ed]" such inspection might work in "a hypothetical case." With respect to whether Gulshan ever inspected Handi-Stop, however, Dhanani testified:

Q. Do you know specifically if Gulshan ever inspected [Handi-Stop]?

A. Specifically, I don't know.

Like in Fort Bend County Drainage District , evidence that Gulshan had performed other inspections of other stores in the past does not constitute evidence of an affirmative undertaking at Handi-Stop. 818 S.W.2d at 397 (holding evidence that District had repaired other area bridges in past did not alone give rise to duty to repair on occasion at issue). The summary-judgment record further shows that Hameed testified that ConocoPhillips performed inspections of the store and sent the reports to Gulshan and to him. Hameed then met with the tenant, Khan, as necessary.

In support of her argument, Bauer relies on ENGlobal U.S., Inc. v. Gatlin , 449 S.W.3d 269 (Tex. App.—Beaumont 2014, no pet.). There, Phillips 66 contracted with Clean Harbors, an industrial service contractor, to clean oil storage tanks at a refinery. Id. at 272. Gatlin, an employee of Clean Harbors, was injured while working at the refinery. Id. At the time of the accident, ENGlobal was a contractor performing engineering and construction management services for Phillips 66 at the refinery. Id. at 272–73. The relationship between ENGlobal and Phillips 66 was governed by a master service agreement ("MSA"). Id. at 273. Gatlin sued ENGlobal for negligence, asserting a negligent-undertaking theory. Id. The court concluded that, to the extent that the MSA required ENGlobal to provide "safety over the work site," then ENGlobal had a contractual duty under the MSA to make the work site safe in the manner, if any, specified by the MSA. Id. at 282. And, to the extent ENGlobal undertook to perform its contractual promise to provide safety, and to the extent it should have recognized that its actions were necessary for the protection of Gatlin, then ENGlobal also had a duty in tort to exercise reasonable care in performing its undertaking so as not to injure Gatlin. Id. Here, unlike in ENGlobal , there is no evidence that Gulshan had a duty under the BMA to inspect Handi-Stop or that Gulshan affirmatively performed any services.

Bauer and the dissenting opinion rely on Seay v. Travelers Indemnity Co. , 730 S.W.2d 774, 777–78 (Tex. App.—Dallas 1987, no writ). There, a hospital maintenance employee died from injuries he suffered when a safety-relief valve on a boiler discharged scalding water onto him. Id. at 775. The plaintiff-spouse sued the hospital's insurer, asserting that it was negligent in inspecting the boilers. Id. It was undisputed that, for several years, employees of the insurer had conducted statutorily-required inspections of the boilers and had reported favorably. Id. The court stated that, when "performing inspections," the insurer "was performing acts which directly promoted the interests of [the hospital] in the safety of its boilers and thereby was undertaking to render services to [the hospital]." Id. at 779. Thus, in performing its inspections, the insurer had a duty to the hospital's employee to perform them properly. See id. at 780. Here, unlike in Seay , Bauer presented no evidence that Gulshan affirmatively performed inspections of the Handi-Stop convenience store.

Bauer's and the dissenting opinion's reliance on Fox v. Dallas Hotel Co. , 111 Tex. 461, 240 S.W. 517, 520–21 (1922), overruled on other grounds, Burk Royalty v. Walls , 616 S.W.2d 911 (Tex. 1981), is also misplaced. In Fox , a night-watchman died from injuries he sustained when an elevator fell. Id. at 517. There, "the uncontradicted evidence established that the defendant in error had, prior to the injuries received by [the decedent], to subserve its own interests, placed engineers in active and actual charge and control of the elevators" at issue. Id. at 518. The court held that the defendant, by "taking over the control and repair of the elevators, to promote its own interests, it became charged with the duty ... to exercise ordinary care to maintain the elevators in a condition of reasonable safety for use." Id. at 520. No such evidence is presented in the instant case.

Having viewed all the evidence in the light most favorable to Bauer, we conclude that she did not present more than a scintilla of probative evidence to raise a genuine issue of material fact regarding the duty element of her negligence claim against Gulshan. See Ridgway , 135 S.W.3d at 600 ; Havner , 953 S.W.2d at 711. Accordingly, we hold that the trial court did not err in granting summary judgment in favor of Gulshan on Bauer's negligence claim. See TEX. R. CIV. P. 166a(i) ; KPMG Peat Marwick , 988 S.W.2d at 748.

Because Bauer did not establish the breach of a legal duty, we do not reach her assertions that the summary-judgment evidence established the existence of genuine issues of material fact regarding proximate cause. See Van Horn v. Chambers , 970 S.W.2d 542, 544 (Tex. 1998) ("The nonexistence of a duty ends the inquiry into whether negligence liability may be imposed.").

We overrule Bauer's sole issue.

Conclusion

We affirm the trial court's judgment.

Keyes, J., dissenting.

DISSENTING OPINION ON REHEARING

Evelyn V. Keyes, Justice

I respectfully dissent from the panel's denial of rehearing of this important negligent undertaking case for the reasons set out herein and in my dissenting opinion of February 27, 2020, which I hereby incorporate by reference. In my view, the majority misconstrues and misapplies the law, requiring Texas Supreme Court correction and clarification of the law that applies when a defendant has undertaken to render services to another party that it should recognize as necessary for the protection of a third person and breaches that duty by negligently failing to exercise reasonable care in performing its undertaking, to the harm of the third person.

Here, defendant Gulshan Enterprises, Inc., as Marketer of ConocoPhillips products, expressly assumed a duty to use reasonable care to ensure that each Marketer Supplied Outlet to which it supplied ConocoPhillips products—including the ConocoPhillips service station and Handi-Stop #79 where drugs were openly displayed, purchased by teenagers in the community, and consumed by the teenaged victim in this case, Emily Bauer, to her great harm—"not engage, permit, or cooperate in any conduct that reflects unfavorably on the reputation of ConocoPhillips in the community ... or ... impairs the goodwill associated with the ConocoPhillips Brands." As part of that undertaking, Gulshan also expressly assumed the duty "not [to] permit on, in[,] or from [Handi-Stop #79] ... the sale or use of illegal drugs or drug paraphernalia." This is the exact assumed duty Gulshan should have recognized as necessary for the protection of teenagers like Emily Bauer in the community but negligently breached, causing the very harm that Emily suffered, with its concurrent damage to ConocoPhillips' reputation and goodwill, as more fully set out in my February 27, 2020 dissenting opinion. See Dissenting Opinion at 6–7.

The majority, however, disregards the plain language of the governing contract between ConocoPhillips and Gulshan; conflates the law of negligent undertaking, premises liability, and simple negligence; finds that Gulshan had no right of control of the premises of the Handi-Stop #79, where Emily Bauer's injury occurred, as required for premises liability but not for liability for a negligent undertaking; and concludes that Gulshan assumed no duties with respect to those premises. Accordingly, the majority misses the law, pled by Bauer, that applies to this case, which is currently set out in section 324A of the Restatement (Second) of Torts. This section has been adopted by the Texas Supreme Court and is still being developed by that court and the intermediate appellate courts.

Section 324A provides, in relevant part,

One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of a third person or his things, is subject to liability to the third person for physical harm resulting from his failure to exercise reasonable care to [perform] his undertaking.

See id. at 17 (quoting RESTATEMENT (SECOND) OF TORTS § 324A (1965) ); Fox v. Dallas Hotel Co. , 111 Tex. 461, 240 S.W. 517, 520–21 (1922) (adopting rule underlying section 324A into Texas law), overruled on other grounds by Burk Royalty Co. v. Walls , 616 S.W.2d 911 (Tex. 1981) ; see also Nall v. Plunkett , 404 S.W.3d 552, 555–56 (Tex. 2013) ; Seay v. Travelers Indem. Co. , 730 S.W.2d 774, 775–78 (Tex. App.—Dallas 1987, no writ).

The majority opinion finds no assumed duty on the part of Gulshan to use reasonable care not to permit the display and sale of illegal drugs at Handi-Stop #79 in its contract with ConocoPhillips, and thus no duty to protect ConocoPhillips' goodwill and reputation by protecting third persons from physical harm resulting from its failure to exercise its undertaken duty not to permit the display and sale of illegal drugs at the Handi-Stop with reasonable care, which it should have recognized as necessary for the protection of persons like Emily Bauer and thus for the protection of ConocoPhillips' goodwill and reputation in the community. In making these conclusions, the majority opinion directly conflicts with Texas Supreme Court law adopting and construing the Restatement of Torts and the law made by the Texas Supreme Court and the appellate courts, cited in my February 27, 2020 dissenting opinion and above, that have continued to develop that law.

As the majority opinion is contrary to controlling law and has the potential to do much damage to an area of tort law that is still developing, it fully satisfies Rule 56.1 governing considerations in granting supreme court review. Accordingly, I urge the Texas Supreme Court to grant review of this important case on the construction of the Restatement (Second) of Torts and its application in Texas law and to reverse the panel opinion and judgment.

Conclusion

I would grant rehearing and would reverse the panel decision for the reasons set forth above and in my dissenting opinion of February 27, 2020.