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Burlington Northern Railroad Company v. General Projection Systems. Inc.5/2/2000
Burlington Northern Railroad Company appeals a judgment rendered on a jury's verdict in favor of General Projection Systems, Inc. (GPS). GPS sued Burlington for breach of a contract for the installation of audiovisual equipment, conversion, and negligence, among other claims. Burlington counterclaimed for breach of contract. Burlington also brought a third-party action against Amwest Surety Insurance Company as surety on GPS's performance bond. The jury found that Burlington breached the contract and GPS did not. It also found that Burlington converted and negligently handled GPS's property and that Burlington acted with malice and gross negligence. The jury awarded actual damages and $7,500,000 in punitive damages. In nine points of error, Burlington contends the evidence is legally and factually insufficient to support:
the jury's findings that Burlington breached the contract and GPS did not, the award of contract damages, the award of tort damages, and the jury's finding that Burlington's conduct was malicious or grossly negligent. Burlington also asserts GPS's complaints sound in contract alone, the jury's award of exemplary damages is grossly disproportionate to actual damages, Burlington is entitled to a settlement credit because of a settlement reached between GPS and another defendant, and that jury misconduct occurred.
We reverse the trial court's judgment as to Burlington's breach of contract claim and GPS's breach of contract claim and remand those claims to the trial court for further proceedings. We also reverse Burlington's third-party action against Amwest and remand it to the trial court for further proceedings. In addition, we reverse that portion of the trial court's judgment awarding GPS actual tort damages of $64,000 and render judgment reducing GPS's actual tort damages to $7000. Finally, we reverse that portion of the trial court's judgment awarding GPS punitive damages and render judgment that GPS take nothing on its punitive damages claim. We remand the remainder of the cause to the trial court with instructions to provide GPS an opportunity to prove the settlement allocation. We further instruct the trial court to grant a settlement credit consistent with this opinion and to recalculate prejudgment interest on the damages awarded.
Background
In 1993, Burlington began planning to build a network operations center (NOC) in Fort Worth. The purpose of the NOC was to consolidate railroad dispatchers from several regional operations centers into one facility. The NOC was to consist of numerous rooms with "stand-alone" audiovisual systems and an overall system tying the rooms together.
Burlington hired Wrightson, Johnson, Haddon, and Williams (WJHW) as the audiovisual consultant on the project and hired Woodbine Development Corporation to act as its construction consultant. WJHW's role was to develop specifications for the project and assist Burlington in the bidding process and selection of an audiovisual contractor. Woodbine's role in the audiovisual portion of the project was to assist Burlington in selecting a design consultant to design the system and in finding an audiovisual contractor.
In June 1994, Burlington awarded a contract to install audiovisual equipment at the NOC to GPS, a company that engineers and installs audiovisual systems. Burlington and GPS did not sign a contract until September 1994. Under the contract, Burlington was to pay GPS $2,172,175. The contract between Burlington and GPS named Woodbine as Burlington's agent. Burlington's manager of operations, Ralph Jones, told GPS to communicate with Woodbine and WJHW on the project.
In two different places, the contract between
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