249 S.W.3d 400, 402 (Tex. 2008)
A finance company repossessed a 1993 Ford Explorer and consigned it for sale at Big H Auto Auction in Houston.1 On October 12, 2000, Big H sold the vehicle at auction for $4,000, receiving a $145 fee from the seller and a $90 fee from the buyer.2 After the buyer discovered that the odometer listed 34,075 miles rather than the actual 84,075 miles, an arbitrator found that Big H had made a clerical error, rescinded the sale, and ordered Big H to buy the car back.3
Big H took title to the Explorer and sold it at auction on October 17, 2000, for $3,100 to Houston Auto Auction, which auctioned the car a week later to Progresso Motors.4 Progresso Motors sold it three days later to Jose Angel Hernandez Gonzalez in Progresso, Texas.5 About a year later, Gonzalez was killed in a rollover accident in Mexico.6
Twelve plaintiffs consisting of Gonzalez’s wife Graciela Gomez De Hernandez, his parents, children, and six intervenors filed suit in Hidalgo County against Ford Motor Co., Bridgestone/Firestone Corp., Progresso Motors, and the two auto auctioneers.7 The trial court granted summary judgment for Big H Auto Auction, the assumed name of defendant New Texas Auto Auction Services, L.P., and severed that claim.8 The court of appeals reversed the summary judgment on the plaintiffs’ strict liability and negligence claims against Big H.9
Whether an auto auctioneer is subject to strict products liability for auctioning a vehicle that later causes injury?10
Under section 402A of the Restatement (Second) of Torts, strict liability applies only to those engaged in the business of selling a product, requiring that the defendant be in the same position as one who sells the product rather than playing an incidental role in its marketing.11
No. The established facts show that Big H Auto Auction normally never took title to the cars it auctioned.12 It did so here only because an arbitrator ordered it to buy the car back after a clerical error.13 Big H received fees of $145 from the seller and $90 from the buyer for the initial auction.14 It sold the vehicle for $3,100 to another auction house.15
An auto auctioneer such as Big H is not subject to strict products liability for auctioning a vehicle that later causes injury.16
Whether an auto auctioneer owes a duty of care to discover and remedy a tire recall before auctioning vehicles to licensed dealers?17
The existence of a legal duty in negligence is determined by considering factors including the risk of injury compared to the burden on the defendant, the social utility of the conduct, whether one party has superior knowledge of the risk, and any right to control the actor whose conduct precipitated the harm.18
No. Big H auctions about 1,000 vehicles each week with many moving on and off the premises in hours.19 It does not inspect or repair vehicles unless specifically requested and paid for.20 Big H sells only to licensed bonded commercial dealers who have at least the same access to recall information.21 It sold the car under a red light indicating it was sold as is without making its own warranties.22
An auto auctioneer does not owe a duty of care to discover and remedy a tire recall before auctioning vehicles to licensed dealers.23