Opinion
No. 04-01-00268-CV
Delivered and Filed: March 6, 2002
Appeal from the 224th Judicial District Court, Bexar County, Texas, Trial Court No. 99-CI-08960, Honorable David Peeples, Judge Presiding.
Sitting: Phil HARDBERGER, Chief Justice, Alma L. LOPEZ, Justice, Paul W. GREEN, Justice.
AFFIRMED
In this plumbing leak case, a jury found that the foundation of the involved home sustained damage resulting from a plumbing leak, and that 25% of the damage was attributable to the leak as opposed to other causes. State Farm Fire and Casualty Company ("State Farm") raises four issues on appeal, arguing: (1) the causation testimony of Rodriguezes' expert, Eugene Dabney, should be stricken as unreliable and therefore constitutes no evidence of causation; (2) the evidence offered by the Rodriguezes did not segregate any damages caused solely by the plumbing leak, therefore the Rodriguezes did not prove causation under Wallis v. USAA; (3) the evidence proved as a matter of law that the damage to the Rodriguezes' house manifested itself prior to the effective dates of the only policy in evidence; and (4) the trial court abused its discretion in striking the testimony of State Farm's expert, which caused the rendition of an erroneous verdict. We affirm the trial court's judgment.
Background
In 1994, the Rodriguezes purchased a home in San Antonio. The house was 35 years old.
At the time the Rodriguezes purchased the home, they received a structural evaluation report from a consulting geotechnical engineer, John W. Dougherty ("Dougherty"). In his report, Dougherty noted cracks in the walls in several different areas of the house. Dougherty concluded, however, that the house and its foundation were structurally sound and in good condition. Dougherty said that because of the age of the structure, limited foundation movement, and favorable soil conditions, larger foundation movements were not expected in the future.
Both in 1995 and 1996, the Rodriguezes noticed new cracks in the walls of the home. In 1997, Beth Rodriguez noticed a crack in the foundation which was visible through the linoleum on the floor of the dinette. As a result of this foundation crack, the Rodriguezes filed a claim with the insurer of the home, State Farm. The home was insured under a standard Texas Dwelling Policy. The Rodriguezes' mistakenly believed the damage resulted from an explosion at a nearby bowling ball factory.
After the claim was filed, State Farm's adjuster dismissed the Rodriguezes explosion theory. Instead, he suspected that the home had a plumbing leak underneath the foundation. State Farm then hired an independent contractor, Preferred Plumbing, to determine whether a plumbing leak existed. Preferred Plumbing conducted a static test on the home and confirmed that there was indeed a leak under the home. Next, State Farm hired CHA Corporation ("CHA"), an engineering firm, to conduct an investigation of the plumbing leak's role in damaging the foundation. CHA conducted a structural evaluation of the home which included visual observations and elevation measurements. CHA concluded that the damage to the Rodriguez residence was caused by the settlement of the left side of the house, not the plumbing leak. Citing this report, State Farm denied the Rodriguezes' claim.
The Rodriguezes then filed suit against State Farm alleging causes of action for breach of contract, breach of the duty of good faith and fair dealing, violation of the Deceptive Trade Practices Act, and violation of the Insurance Code. The Rodriguezes also joined CHA as a defendant in an action for civil conspiracy. The trial court granted summary judgment in favor of the defendants on the Rodriguezes' extra-contractual claims. The breach of contract claim was tried to a jury.
At trial, the Rodriguezes presented Eugene Dabney ("Dabney") as their sole expert witness on causation. After analyzing CHA's structural evaluation report, Dabney concluded that the plumbing leak was solely responsible for the foundation damage. State Farm filed a motion to strike Dabney's expert testimony as unreliable. The trial court held a Daubert / Robinson hearing and subsequently denied State Farm's motion.
During its case-in-chief, State Farm called Dr. Ramon Carrasquillo ("Carrasquillo") as its expert witness on causation. Carrasquillo used a PowerPoint presentation during his testimony as a demonstrative aid. The Rodriguezes filed a motion to strike Carrasquillo's testimony, arguing that they had not had the opportunity to review the PowerPoint presentation prior to trial. As a discovery sanction, the trial court struck the testimony of Carrasquillo.
The jury returned a verdict finding that the plumbing leak caused 25% of the foundation damage to the Rodriguezes' home, and the trial court entered the judgment.
Discussion
I. Eugene Dabney's Expert Testimony
"In determining whether there is evidence of probative force to support a jury's finding, all the record evidence must be considered in the light most favorable to the party in whose favor the verdict has been rendered, and every reasonable inference deducible from the evidence is to be indulged in that party's favor." Merrell Dow Pharms. V. Havner, 953 S.W.2d 706, 711 (Tex. 1997). We will sustain a no-evidence point when "(a) there is a complete absence of evidence of a vital fact, (b) the court is barred by rules of law or of evidence from giving weight to the only evidence offered to prove a vital fact, (c) the evidence offered to prove a vital fact is no more than a scintilla, or (d) the evidence conclusively establishes the opposite of the vital fact." Id.
Whether the trial court properly admitted expert testimony is subject to an abuse of discretion standard of review. Helena Chem. Co. v. Wilkins, 18 S.W.3d 744, 752 (Tex.App.-San Antonio 2000, no pet.). "We examine the entire substance of the expert's testimony `to determine if the opinion is based on demonstrable fact and does not rely solely on assumptions, possibility, speculation, and surmise.'" Id. An abuse of discretion exists when the court fails to analyze or apply the law correctly. Id.
In demonstrating that an expert is qualified to testify under Texas Rule of Evidence 702, the proponent of the evidence has the burden to demonstrate that the expert's testimony is both relevant to the issues and based on a reliable foundation. E.I. du Pont de Nemours and Co., Inc. v. Robinson, 923 S.W.2d 549, 556 (Tex. 1995). To be reliable, the scientific evidence must be grounded in scientific method and procedure such that it amounts to more than subjective belief or unsupported speculation. Gammill v. Jack Williams Chevrolet, Inc., 972 S.W.2d 713, 720 (Tex. 1998). "Unreliable evidence is of no assistance to the trier of fact and is therefore inadmissible under Rule 702." Id.
In Robinson, the Texas Supreme Court enumerated a list of factors to determine the reliability of expert testimony, including: (1) the extent to which the theory has or can be tested; (2) the extent to which the technique relies upon subjective interpretation of the expert; (3) whether the theory has been subjected to peer review and publication; (4) the technique's potential rate of error; (5) whether the underlying theory or technique has been generally accepted as valid by the relevant scientific community; and (6) the nonjudicial uses that have been made of the theory or technique. Robinson, 923 S.W.2d at 556. However, in Gammill, the Court held that the Robinson factors do not always apply to expert testimony because they do not always fit. Gammill, 972 S.W.2d at 726. Regardless of whether the Robinson factors are applied, the proponent of the expert testimony must still prove that the testimony is reliable. Id. In such a case, the court must consider whether there is too great of an "analytical gap" between the data and the expert's opinion. Id. The trial court's duty is not to determine whether the expert's conclusions are correct, but only whether the analysis used to reach them is reliable. Id.
State Farm argues that the testimony of Dabney should have been stricken as unreliable. State Farm points to Dabney's testimony that any attempt to allocate the amount of foundation damage to various potential contributing causes would be a "wild ass guess." The Rodriguezes contend Dabney's analytical method met the Robinson qualifications.
Both at the pre-trial Daubert / Robinson hearing and during Dabney's testimony at trial, State Farm introduced excerpts from Dabney's deposition testimony taken during discovery. State Farm bases its argument on answers Dabney gave during the deposition. The relevant portions of that testimony are as follows:
Q: Now, Mr. Dabney, as we sit here today, we have identified seven potential contributing causes to the damage to this house that include, and you affirm or deny these as we go along, number one, plumbing leaks, correct?
A: That's correct.
Q: Number two, climatic conditions, correct?
A: Correct.
Q: Number three, poor drainage, correct?
A: That's correct.
Q: Number four, watering patterns, correct?
A: Correct.
Q: Number five, the railroad or the choo-choo, correct?
A: Correct.
Q: Number six, the bowling ball plant explosion, correct?
A: Correct.
Q: And number seven, the dynamite or other bomb explosion, correct?
A: Correct, if they exist , yes.
Q: All right. Now, as we sit here today, Mr. Dabney, can you allocate, to a percentage, the cause, the damage to this house and attribute a hundred percent of this house allocated to these seven causes?
A: Absolutely not. That would be a wild-ass guess.
Dabney testified that no credible engineer could allocate a hundred percent of the damage to the seven potential causes in this particular case. State Farm argues that Dabney's inability to allocate 100% of the damage to the various potential contributing causes makes his opinion unreliable. State Farm did not attack Dabney's qualifications, data, or methodology. Because State Farm raises the issue as a "no evidence" point, we must consider all of the evidence in the record in the light most favorable to the Rodriguezes, indulging every possible inference in their favor. See Havner, 953 S.W.2d at 711.
At the Daubert / Robinson hearing, the Rodriguezes presented Dabney's structural evaluation report to the trial court. In preparing his report, Dabney used the same data that CHA collected with respect to the Rodriguez home. After analyzing the data, Dabney said that the only possible causes of foundation movement were the influence of a sub-foundation plumbing leak and the influence of climatic conditions. He concluded that the subfoundation plumbing leak was the only cause of movement that resulted in damage to the foundation.
During Dabney's testimony at trial, the jury heard the same evidence. He testified that 100% of the damage to the foundation damage was attributable to the plumbing leak. On cross-examination, State Farm once again introduced Dabney's deposition testimony, revealing his alleged inability to segregate 100% of the damage to various potential contributing causes. The record also contains an affidavit from Dabney, which the Rodriguezes attached in a response to State Farm's motion for summary judgment. In the affidavit, Dabney reiterates his belief that while there were possible contributing causes to the foundation movement, i.e. plumbing leaks and climatic conditions, the damage to the foundation was caused solely by the leak.
We find Dabney's opinion reliable. There is no dispute that a plumbing leak existed underneath the foundation of the Rodriguezes' home. Dabney's opinions are based on the same data State Farm used: the CHA report. In his initial report, his affidavit, and his testimony during direct examination at trial, Dabney consistently stated that the plumbing leak caused 100% of the damage to the foundation. The seven contributing causes referenced by State Farm's attorney were merely hypothetical. When asking the question, State Farm's attorney used the phrase "potential contributing causes." Indeed, after acknowledging the seventh and final potential contributing cause, Dabney stated "if they exist." Both in his testimony on direct examination and his affidavit, Dabney made it clear that from the data provided to him, the only possible causes of foundation damage were the plumbing leak and climatic conditions
While Dabney's use of the phrase "wild-ass guess" is not a term of art that can be deemed helpful to the Rodriguezes' case, it does not make the opinion unreliable. He was not required to assign precise percentages to potential contributing causes that might or might not have existed. We look at the substance of the entire testimony, not merely one phrase. Dabney's inability to apportion damage among seven possible contributing causes, goes to the weight of his testimony, not its admissibility. The record as a whole shows that Dabney's opinions are grounded in scientific method and procedure and amount to more than subjective belief or unsupported speculation. See Gammill, at 720. Examining the entire substance of Dabney's testimony, his opinion "is based on demonstrable fact and does not rely solely on assumptions, possibility, speculation, and surmise." See Wilkins, 18 S.W.3d at 752. The trial court did not abuse its discretion in admitting Dabney's expert testimony. See id.
II. Failure to Prove Causation
Under the doctrine of concurrent causes, when "covered and non-covered perils combine to create a loss, the insured is entitled to recover only that portion of the damage caused solely by the covered peril(s)." Wallis v. United Servs. Auto. Ass'n, 2 S.W.3d 300, 302-03 (Tex.App.-San Antonio 1999, pet. denied). "Because an insured can recover only for covered events, the burden of segregating the damage attributable solely to the covered event is a coverage issue for which the insured carries the burden of proof." Id. at 303. "To this end, the insured must present some evidence upon which the jury can allocate the damage attributable to the covered peril." Id. Although a plaintiff is not required to establish the amount of his damages with mathematical precision, there must be some reasonable basis upon which the jury's finding rests." Id. at 304.
State Farm argues that Dabney failed to allocate 100% of the foundation damage to the various potential contributing causes; therefore, the Rodriguezes did not prove causation under Wallis. But, in Wallis, "[t]he jury heard no testimony regarding how much damage was caused by the plumbing leaks." See Wallis, 2 S.W.3d at 304 (emphasis added). Here, Dabney testified that 100% of the damage was caused by the plumbing leaks. Dabney's testimony provided "some reasonable basis upon which the jury's finding [of damage attributable to the plumbing leaks] rests." See id.
The next issue is whether the evidence supported the jury's finding that 25% of the damage was attributable to the plumbing leaks. The Rodriguezes' testimony was that 100% of the damage was caused by plumbing leaks. State Farm said that 0% of the damage was caused by plumbing leaks. It is fundamental that a jury may blend the evidence admitted before it and believe all, some or none of a witness's testimony. See e.g., Aboud v. Schlichtemeier, 6 S.W.3d 742, 749 (Tex.App.-Corpus Christi 1999, pet. denied); E.P. Operating Co. v. Sonora Exploration Corp., 862 S.W.2d 149, 154 (Tex.App.-Houston [1st Dist.] 1993, writ denied); Chrysler-Plymouth City, Inc. v. Guerrero, 620 S.W.2d 700, 704 (Tex.Civ.App.-San Antonio 1981, no writ). "Juries may disbelieve any witness even though he is neither impeached nor contradicted, they may believe one witness and not others, and they are not required to depend on evidence from a single source." Mills v. Jackson, 711 S.W.2d 427, 434 (Tex.App.-Fort Worth 1986, no writ).
In reaching its holding in Wallis, this court relied on Oyster Creek Financial Corp. v. Richwood Investments II, Inc., 957 S.W.2d 640 (Tex.App.-Amarillo 1997, pet. denied), to support the assertion that "Although a plaintiff is not required to establish the amount of his damages with mathematical precision, there must be some reasonable basis upon which the jury's finding rests." Wallis, 2 S.W.3d at 304. In Oyster Creek Financial Corp., the court was considering whether the evidence was factually sufficient to support a jury's award of zero dollars for lost profits. 957 S.W.2d at 649. It is well-established that in resolving damage issues, a jury's finding will be upheld if it is within the range of the testimony regarding the amount of damages incurred. See e.g., Aboud v. Schlichtemeier, 6 S.W.3d 742 at 748-49; E.P. Operating Co. v. Sonora Exploration Corp., 862 S.W.2d at 154-55; Chrysler-Plymouth City, Inc. v. Guerrero, 620 S.W.2d at 704. The same is true regarding the amount of attorneys' fees awarded by a jury. See Mandell v. Hamman Oil and Refining Co., 822 S.W.2d 153, 166 (Tex.App.-Houston [1st Dist.] 1991, writ denied). Accordingly, with regard to the segregation of damages attributable to a covered cause, so long as the jury's finding is within the range of testimony presented, the jury's finding will be upheld. To hold otherwise would force a jury to accept only the exact percentage proffered by one side or the other. The jury can blend the evidence rather than relying on a single source.
In this case, the testimony regarding the percent of damage attributable to the plumbing leaks ranged from 0% to 100%. The jury's finding of 25% was within this range. The Rodriguezes satisfied the requirements of Wallis.
III. Damage During Policy Period
"An insured cannot recover under an insurance policy unless facts are pleaded and proved showing that damages are covered by his policy." Employers Cas. Co. v. Block, 744 S.W.2d 940, 944 (Tex. 1988), overruled on other grounds, State Farm Fire Cas. Co. v. Gandy, 925 S.W.2d 696 (Tex. 1996). "Texas courts have held that property loss occurs when the injury of damages is manifested." State Farm Mut. Auto. Ins. Co. v. Kelly, 945 S.W.2d 905, 910 (Tex.App.-Austin 1997, writ denied). Property damage manifests itself when it becomes "apparent." Dorchester Dev. Corp. v. Safeco Ins. Co., 737 S.W.2d 380, 383 (Tex.App.-Dallas 1987, no writ).
In considering the legal sufficiency point, we consider only the evidence favorable to the trial court's decision and disregard all evidence and inferences to the contrary. Continental Coffee Prods. Co. v. Cazarez, 937 S.W.2d 444, 450 (Tex. 1996). If there is any evidence of probative force to support the finding, the issue must be overruled and the finding upheld. ACS Investors, Inc. v. McLaughlin, 943 S.W.2d 426, 430 (Tex. 1997).
State Farm argues that the only policy presented into evidence by the Rodriguezes covered a one year period from February 9, 1997 to February 9, 1998. State Farm contends that the damage to the Rodriguezes' home manifested itself as early as 1995. The Rodriguezes argue that their insurance policy was in existence since 1995, and that State Farm judicially admitted such in a request for admission. In the alternative, they contend that the damage to the home did not manifest itself until 1997.
The only policy in the record covered the Rodriguezes' home from February 1997 to February 1998. There is, however, evidence in the record indicating that the Rodriguezes were covered by the same policy as early as 1995, renewing the policy annually until 1999. The record contains a check from Beth Rodriguez made out to State Farm in the amount of $263.00. The check has a notation which states "2010 Arroya Vista Ins. — 2/9/95 — 2/9/96." The check also contains an electronic marking at the top "83-BV 4911 9." This is the same policy number of the policy in evidence covering February 1997 to February 1998. The record also contains State Farm's claims file regarding the Rodriguez home. Within the file, on a paper entitled "Coverage Information", a notation appears that the policy was first issued in 1995.
State Farm cites an unpublished opinion, Vanguard Underwriters Ins. Co. v. Forist, 1999 WL 498200 (Tex.App.-San Antonio 1999), for the proposition that an insured must present the actual policy into evidence in order to prove coverage during the policy period. Even if this opinion was citable authority, however, it is factually distinct from the present case. In Vanguard, as in the present case, there was only one actual policy in evidence. Vanguard, 1999 WL 498200 at *2. The only other evidence presented by the insured was her oral testimony that she had been covered by an earlier policy. Id. There was no other physical evidence indicating any other policy or its terms. In the present case, there is physical evidence of a policy covering the Rodriguezes' home since 1995.
Both of the Rodriguezes testified that they began noticing cracks in the walls in 1995 and 1996. However, Beth Rodriguez testified that she noticed the foundation crack in 1997. As a result, the damage to the foundation did not become apparent until 1997, when the foundation crack was first noticed. See Dorchester Dev. Corp., 737 S.W.2d at 383. Although cracks in the walls are signs of some foundational problems, such cracks do not indicate foundational damage resulting from a plumbing leak. The record contains probative evidence from which the jury could determine that the foundation damage manifested itself in 1997. See McLaughlin, 943 S.W.2d at 430. Even if the damage manifested itself as early as 1995 or 1996, probative evidence exists indicating that the home was covered by a State Farm policy since 1995. See id.
IV. The Striking of Carrasquillo's Expert Testimony
Texas Rule of Civil Procedure 215(5) provides the following:
A party who fails to respond to or supplement his response to a request for discovery shall not be entitled to present evidence which the party was under a duty to provide in a response or supplemental response or to offer the testimony of any expert witness or of any other person having knowledge of discoverable matter, unless the trial court finds that good cause sufficient to require admission exists. The burden of establishing good cause is upon the party offering the evidence and good cause must be shown in the record. Tex.R.Civ.P. 215(5).
"Rule 215 (5) does not, however, mandate exclusion of the entire testimony of an expert who is, as in this case, objected to on grounds other than a failure to identify". Castillo v. No. 08-96-00267-CV, 965 S.W.2d 646, 652 (Tex.App.-El Paso 1998, no pet.). "The rationale for excluding an unidentified witness's testimony, despite lack of surprise, unfairness or ambush, is to assure that, in preparing for trial, a party can rely on no unidentified witnesses being called to testify." Id. "Where a witness is properly identified, the rationale for total exclusion does not exist, and the issue is whether his testimony should be limited because of an inadequate discovery response or supplementation." Id.
Sanctions for discovery abuse must be "just." TransAmerican Natural Gas Corp. v. Powell, 811 S.W.2d 913, 917 (Tex. 1991). Whether sanctions are just must meet a two-part test: (1) there must be a direct relationship between the offensive conduct and the sanction imposed, and (2) the sanction must not be excessive. Id. In other words, the "punishment should fit the crime." Id.
"A trial court has broad discretion in entering sanctions." Hawkins v. Estate of Volkmann, 898 S.W.2d 334, 346 (Tex.App.-San Antonio 1994, writ denied). "The standard of review on appeal is whether the trial court abused its discretion." Id.
State Farm argues that the trial court's striking of its expert, Dr. Carrasquillo, was a clear abuse of discretion and caused the rendition of an erroneous verdict. State Farm contends that the striking constituted a "death penalty" discovery abuse sanction which was overly harsh.
During his direct examination, Carrasquillo utilized a PowerPoint presentation as a demonstrative aid before the jury. The Rodriguezes objected at that time, and a bench hearing was held outside the presence of the jury. After the hearing, the court did not rule on the objection that day. The next day, the Rodriguezes filed a motion to strike, for sanctions, and for a mistrial. The Rodriguezes argued that the PowerPoint presentation contained testimony outside the scope of what Carrasquillo had testified to during his deposition. The Rodriguezes further argued that State Farm had withheld the PowerPoint presentation during discovery, denying them the opportunity to inspect the presentation before trial. After hearing the arguments, the testimony was struck.
The parties dispute whether or not State Farm withheld the PowerPoint presentation from the Rodriguezes. The record does not adequately resolve this dispute. In fact, the record does not contain the applicable discovery responses. The trial court determined that State Farm had engaged in abusive practices by withholding the PowerPoint presentation. Because the record does not contain any evidence to the contrary, we cannot conclude that the trial court abused its discretion. See Hawkins, 898 S.W.2d at 346.
State Farm's contention that the striking of Carrasquillo amounted to a death penalty sanction is not accurate. They did not have the burden of proof. Striking Carrasquillo's testimony did not prevent State Farm from presenting the merits of their case, and they, in fact, did so. See Blackmon, 841 S.W.2d at 849. The trial court did not abuse its discretion.
Conclusion
The judgment of the trial court is affirmed.