City of Houston v. Southwestern Bell Telephone Company, 01-16-00734-CV

Background

A City of Houston crew excavated to repair a water main on March 2, 2013; a nearby utility pole bore an AT&T/Southwestern Bell warning sign but city workers testified they did not read it.
While operating a backhoe and concrete breaker, city employees damaged a hard-clay duct run and a cable owned by Southwestern Bell; an internal air-pressure system alerted Southwestern Bell to the damage at the excavation site.
Southwestern Bell sued the City for negligence, alleging (1) the City failed to wait 48 hours after notice under the Utilities Code and (2) the City negligently operated motor-driven equipment (the backhoe) without reasonably locating underground utilities.
At trial the jury found the City negligent and awarded damages; the trial court included excerpts of the Utilities Code in the jury charge over the City's objection.
On appeal the City argued the trial court lacked subject-matter jurisdiction because governmental immunity was not waived, and that the jury charge improperly allowed liability theories for which immunity had not been waived.
The court held the evidence was legally and factually sufficient to support negligence based on operation of motor-driven equipment (waiving immunity under the TTCA) but reversed and remanded for a new trial because the jury charge improperly permitted a liability finding based on statutory notice theories for which immunity was not waived.

Issues

Issue	Plaintiff's Argument (Southwestern Bell)	Defendant's Argument (City of Houston)	Held
Whether the trial court had subject-matter jurisdiction under TTCA (immunity waiver)	Injury "arose from" operation of motor-driven equipment (backhoe); proximate cause shown by forensic evidence that only heavy equipment could have damaged duct	Immunity not waived absent proof that damage arose from negligent operation of equipment; challenge sufficiency of negligence evidence	Held: Evidence legally and factually sufficient that damage arose from operation of backhoe; TTCA waiver applies; jurisdiction proper on that theory
Whether evidence was sufficient to prove negligence and proximate cause	City crew failed to reasonably inquire or look for underground utilities (ignored pole sign; probing was inadequate); expert testimony tied damage to backhoe	City pointed to use of probing rods and disputed whether crew sought other utilities; argued no proof operator struck the duct	Held: Evidence sufficient on duty, breach, and proximate cause (duct hardness, alarm, testimony supported backhoe as cause)
Whether including Utilities Code excerpts in the jury charge was proper	Southwestern Bell requested the statutory instructions and argued City failed to wait 48 hours after notice	City objected: failure-to-notify theory is not a basis for TTCA waiver; charging it allowed verdict on non-waivable theory	Held: Error to include those statutory excerpts; jury may have relied on a non-waivable theory (notice), so error was harmful; reversed and remanded for new trial on negligence despite sustaining waiver finding

Key Cases Cited

Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217 (Tex. 2004) (framework for resolving governmental-immunity challenges and when fact issues should go to the factfinder)
Prairie View A&M Univ. v. Brooks, 180 S.W.3d 694 (Tex. App.—Houston [14th Dist.] 2005) (post-trial jurisdictional challenge reviewed for legal sufficiency where jury findings bear on immunity)
Ryder Integrated Logistics, Inc. v. Fayette Cty., 453 S.W.3d 922 (Tex. 2015) (waiver under TTCA requires nexus to operation/use of the equipment; negligence unrelated to equipment operation does not waive immunity)
Pioneer Natural Gas Co. v. K & M Paving Co., 374 S.W.2d 214 (Tex. 1964) (extraordinary use of surface creates duty to avoid striking utilities or make reasonable inquiry)
City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (legal-sufficiency review standards and reasonable-inference principles)
Nabors Drilling, U.S.A. Inc. v. Escoto, 288 S.W.3d 401 (Tex. 2009) (elements of negligence summarized)
Dallas Area Rapid Transit v. Whitley, 104 S.W.3d 540 (Tex. 2003) (nexus for TTCA liability: injury must arise from operation/use of vehicle or equipment)
Bed, Bath & Beyond, Inc. v. Urista, 211 S.W.3d 753 (Tex. 2006) (reversal standard for an incorrect jury instruction that probably caused rendition of an improper judgment)
San Antonio Water Sys. v. Nicholas, 461 S.W.3d 131 (Tex. 2015) (post-trial review for legal sufficiency where jury findings affect waiver of immunity)
Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546 (Tex. 1985) (foreseeability as an element of proximate cause)