McGuireWoods Attorneys Analyze Texas Supreme Court Opinion on Utility Tariff

August 3, 2022

McGuireWoods partner Brian Jackson and associates Drew Gann and Kristen Mynes co-authored an article in the Institute for Energy Law’s June 2022 Oil & Gas E-Report.

The attorneys analyzed CenterPoint Energy Resources Corp. v. Ramirez, a 2022 Texas Supreme Court decision. In the case of first impression, the court held that a limitation-of-liability provision in a utility tariff — the document that governs a customer’s relationship with a utility and must be approved by state regulators — bars the utility’s liability for damages suffered by a residential customer’s houseguest.

According to the article — titled “Texas Supreme Court Enforces Limitation on Liability in Natural Gas Utility Tariff” — the plaintiff sued CenterPoint Energy Resources for negligence, alleging he was injured when escaped gas accumulated to combustible levels and ignited in the home where he was a guest. A jury awarded millions in damages and a Texas Court of Appeals upheld the verdict.

The Texas Supreme Court reversed that ruling, holding that the houseguest’s negligence claims were precluded because the tariff’s terms expressly apply to “all consumers” and a houseguest met the tariff’s special definition of that term. Because a regulatory body approved the tariff, it is not a “mere contract” and instead carries “the force and effect” of law. As consumers, houseguests are bound by the tariff’s terms, and neither assent nor actual knowledge is required to enforce its terms as written, the McGuireWoods lawyers wrote.

The Institute for Energy Law recently selected Drew for its 2022-2023 Leadership Class, a program designed to bolster knowledge and leadership skills in professionals who have practiced in the energy field between three and 12 years. Drew also serves as an editor for the Oil & Gas E-Report.