Summary
The Supreme Court of Texas held that a regulatory permit to operate a wastewater injection well does not immunize the permit holder from civil tort liability to private parties. Interpreting the Texas Injection Well Act and related administrative regulations, the court concluded that the permit did not bar a potential trespass claim based on subsurface migration of injected wastewater. The court reversed the court of appeals' judgment and remanded for consideration of unresolved trespass, jury-charge, and directed-verdict issues.
Topics
Practice areas
Questions Presented
- Whether a TCEQ permit to operate a deep wastewater injection well immunizes the permit holder from private civil tort liability for consequences of activity authorized by the permit.
- Whether Texas Water Code section 27.104 and 30 Texas Administrative Code section 305.122(c) preserve civil liability and property-rights claims arising from permitted injection activity.
- Whether the court of appeals erred by resolving the permit-immunity issue without addressing FPL's directed-verdict, jury-charge, and other trespass issues.
- Whether subsurface wastewater migration can constitute a trespass, and whether the alleged migration constituted a trespass in this case.
Holdings
- The mere issuance of a regulatory permit does not immunize the permit holder from civil tort liability to private parties for consequences arising from activity conducted under the permit.
- The court did not decide whether subsurface wastewater migration can constitute a trespass or whether a trespass occurred on the facts of this case.
- Railroad Commission of Texas v. Manziel and Coastal Oil & Gas Corp. v. Garza Energy Trust did not establish blanket immunity from trespass liability for permitted subsurface injection, and their reasoning did not control this wastewater-injection case.
Key quotations
“As a general rule, a permit granted by an agency does not act to immunize the permit holder from civil tort liability from private parties for actions arising out of the use of the permit.” (310)
“A permit may thus be perfectly valid, so far as the conservation laws are concerned, and yet the permittee's right to drill under it may depend upon his establishing title in a suit at law.” (311)
“The permit may thus be perfectly valid, so far as the conservation laws are concerned, and yet the permittee's right to drill under it may depend upon his establishing title in a suit at law.” (311-312)
“The 'plain and common meaning of the statute's words' directly contradicts the court of appeals' holding in this case.” (312)
“The language of the Injection Well Act and the portions of the Texas Administrative Code governing the TCEQ do not shield permit holders from civil tort liability that may result from actions governed by the permit.” (315)
Factual background
FPL owned surface and subsurface rights to two Liberty County tracts used primarily for rice farming. EPS operated permitted deep wastewater injection wells on adjoining land and injected non-hazardous wastewater approximately one and a half miles below the surface. FPL alleged that the injected wastewater migrated into the subsurface beneath its property and contaminated its water supply, asserting trespass and other claims. The jury failed to find a trespass.
Procedural history
EPS obtained TCEQ permits to construct and operate deep wastewater injection wells adjoining FPL's property. After a jury found for EPS on FPL's trespass and other claims, the trial court entered a take-nothing judgment. The Beaumont Court of Appeals affirmed without reaching FPL's jury-charge and directed-verdict arguments, holding that the permit precluded a trespass claim. The Supreme Court reversed that legal conclusion and remanded for consideration of the unresolved trespass-related issues.
Remand instructions
The court of appeals was instructed to consider the issues originally presented by FPL, including whether FPL was entitled to a directed verdict on consent, whether the jury charge improperly shifted the burden of proof on consent, whether the charge should have stated that injury is not a necessary element of trespass, and whether the evidence supported the jury's findings on trespass, negligence, and unjust enrichment.