Delia Pagayon, Michelle Fulton, Alfredo G. Pagayon, Michael G. Pagayon, and the Estate of Alfredo M. Pagayon v. Exxon Mobil Corporation, 15-0642

Background

The case arises from injuries caused by an Exxon employee acting outside the scope of employment; petitioners sought to hold Exxon liable for failing to control that employee.
The Court of Appeals relied on Restatement (Second) of Torts § 317 in evaluating an employer’s duty to control an off-duty or off-scope employee.
The Texas Supreme Court affirmed that Exxon owed no duty here because Exxon neither knew nor should have known of a necessity or opportunity to control the employee, and the risk was slight and unforeseeable.
Justice Boyd concurred in the judgment but declined to join the Court’s opinion because the Court rejected § 317 unnecessarily and provided little usable guidance.
The concurrence argues the Court should have either adopted § 317 or articulated a clearer, objective standard (a “necessity” rule) rather than rejecting § 317 and applying only an ad hoc balancing test.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether an employer owes a duty to control an employee acting outside the scope of employment	Petitioners argued Exxon should be liable for failing to control its employee who harmed a third party	Exxon argued no duty where employee acted outside scope, no foreseeability, and no knowledge of necessity to intervene	Court: No duty; Exxon did not know and should not have known a need/opportunity to control the employee
Whether Restatement (Second) § 317 should govern Texas law on employer’s duty to control employees	Petitioners and lower court treated § 317 as applicable	Exxon and Court questioned § 317’s fit with Texas’s balancing approach	Court rejected § 317 as stating the employer’s duty; concurrence: rejection was unnecessary
Whether the Texas balancing test provides sufficient guidance to courts on employer duty	Petitioners favored a rule that would impose liability in circumstances like this	Exxon favored applying the established balancing test (foreseeability, burden, utility, control) to deny duty	Court applied balancing test and found duty would not extend to these facts; concurrence criticized lack of clear standard
Whether an employer may have duty when employee not on employer premises or using employer property	Petitioners contended circumstances justified employer responsibility	Exxon noted § 317 and factual limits (on premises/using property) preclude duty here	Court agreed no duty where employee acted off premises and Exxon lacked knowledge of need to intervene

Key Cases Cited

Humble Sand & Gravel, Inc. v. Gomez, 146 S.W.3d 170 (Tex. 2004) (describing Texas’s general balancing test for duty)
Praesel v. Johnson, 967 S.W.2d 391 (Tex. 1998) (earlier articulation of duty factors referenced by Texas courts)
VanDevender v. Woods, 222 S.W.3d 430 (Tex. 2007) (caution against deciding more than necessary)
PDK Labs., Inc. v. DEA, 362 F.3d 786 (D.C. Cir. 2004) (quoted for judicial-restraint principle)
Jacobellis v. Ohio, 378 U.S. 184 (1964) (Stewart’s “I know it when I see it” concurrence cited regarding vague standards)
State Farm Fire & Cas. Co. v. Simmons, 963 S.W.2d 42 (Tex. 1998) (criticized for ad hoc decisionmaking in duty determinations)
Twyman v. Twyman, 855 S.W.2d 619 (Tex. 1993) (dissent on need for principled standards)
Nabors Drilling, U.S.A., Inc. v. Escoto, 288 S.W.3d 401 (Tex. 2009) (prior Texas case citing § 317)
Loram Maint. of Way, Inc. v. Ianni, 210 S.W.3d 593 (Tex. 2006) (prior Texas case referencing § 317)
Otis Eng’g Corp. v. Clark, 668 S.W.2d 307 (Tex. 1983) (earlier citation of § 317)
Kelsey–Seybold Clinic v. Maclay, 466 S.W.2d 716 (Tex. 1971) (historical citation noting § 317)