pjc-oil-and-gas-2024-lib

D AMAGES

PJC 313.26

PJC 313.26 Confusion of Goods (Comment) When to use. Where a mixture of goods of different parties is homogeneous, the goods are similar in nature and value, and the portion of each may be properly shown, each party may claim its fractional share of the mass. Humble Oil & Refining Co. v. West , 508 S.W.2d 812, 818 (Tex. 1974). A party who so commingles such goods must account for the other party’s fractional share of the homogeneous mass. BlueStone Natural Resources II, LLC v. Randle , 620 S.W.3d 380, 399–400 (Tex. 2021). The confusion of goods theory attaches only when the commingled goods of differ ent parties are so confused that the property of each cannot be distinguished. Humble Oil & Refining Co. , 508 S.W.2d at 818. The rule does not apply until the facts establish that there has been such a commingling. Mooers v. Richardson Petroleum Co. , 204 S.W.2d 606, 608 (Tex. 1947). Burden of proof. The burden is on the one commingling the goods to properly identify the fractional share with reasonable certainty. BlueStone Natural Resources II, LLC , 620 S.W.3d at 399 n.111 (citing Humble Oil & Refining Co. , 508 S.W.2d at 818– 19). In applying the rule, it is proper to hold the willful commingler to a strict showing. Mooers , 204 S.W.2d at 608. Possible jury questions. As a threshold matter, a jury question might be needed to determine if commingled goods of different parties are so confused that the property of each cannot be distinguished. If such confusion does exist, the burden shifts to the commingler to establish with reasonable certainty the fractional share in question. See Humble Oil & Refining Co. , 508 S.W.2d at 819 (“The threshold question for determi nation is whether the requisite computation of reserves is capable of establishment with reasonable certainty; and, if so, the further question to be resolved is whether the burden defined above is discharged by Humble under the evidence.”). Reasonable certainty. The Texas Supreme Court has not defined the “reasonable certainty” standard in cases involving the confusion of goods doctrine. However, it has applied that standard in evaluating awards for lost profits damages, which must be proven with “reasonable certainty.” See Horizon Health Corp. v. Acadia Healthcare Co. , 520 S.W.3d 848, 859–60 (Tex. 2017); Phillips v. Carlton Energy Group, LLC , 475 S.W.3d 265, 278 (Tex. 2015); ERI Consulting Engineers, Inc. v. Swinnea , 318 S.W.3d 867, 876 (Tex. 2010); Texas Instruments, Inc. v. Teletron Energy Management, Inc. , 877 S.W.2d 276, 279 (Tex. 1994). In that context, a fact question is raised if there is legally sufficient evidence of lost profits. Southwest Battery Corp. v. Owen , 115 S.W.2d 1097, 1098 (Tex. 1938); see also W.L. Lindemann Operating Co. v. Strange , 256 S.W.3d 766, 770 (Tex. App.—Fort Worth 2008, pet. denied) (“[T]he evidence is legally and factually insufficient to support the jury’s findings on willful commin gling.”). For further discussion, see PJC 313.22.

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