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GREGORY v. GARRETT CORP.

June 1, 1984

GWENDOLYN L. GREGORY, as Executrix under the Will of JOSEPH MORGAN GREGORY, Deceased, Plaintiffs, against THE GARRETT CORPORATION, COLT ELECTRONICS CO., INC., PHOENIX AEROSPACE, INC., AND LOCKHEED CORP., Defendants; THE GARRETT CORPORATION and LOCKHEED CORPORATION, Third-Party Plaintiffs, against TEXASGULF, INC. and TEXAS GULF AVIATION, INC., Third-Party Defendants


The opinion of the court was delivered by: GOETTEL

MEMORANDUM DECISION AND ORDER

In most of the twenty-one related actions arising out of the crash of Texasgulf Aviation, Inc.'s ("TGA's") Lockheed Jetstar near Westchester airport on February 11, 1981, TGA and its parent, Texasgulf, Inc. ("Texasgulf"), as defendants or third-party defendants, *fn1" asserted two affirmative defenses against the claims brought by the estates of the six passengers and two crew members who died in the crash. The first defense was that of employer's immunity from suit under the pertinent workers' compensation laws, and the second defense was that of release from any potential tort liability or liability for contribution to other defendants. *fn2"

 When Texasgulf and TGA moved for summary judgment based on these two affirmative defenses, the Court denied both motions, primarily on the ground that material issues of fact remained to be litigated. Thereafter, Texasgulf and TGA moved for a bifurcated trial, with the affirmative defenses to be tried first and the issues of liability and damages to be tried later. That application was granted and the two defenses were tried to a jury during the month of April.

 During their deliberations the jury considered the following special interrogatories and gave the following answers:

 Q.1. Do you find: that at the time of the crash Texasgulf Aviation functioned solely as the aviation department of Texasgulf; that Texasgulf and Texasgulf Aviation were so merged that they were really only one entity; that Texasgulf Aviation had no purpose other than to carry out Texasgulf's business; and that Texasgulf Aviation's corporate structure and any right it had to control the flight crews and maintenance personnel were so merged with those of Texasgulf that for purposes of determining the scope of workers' compensation immunity Texasgulf Aviation should be considered the alter ego of Texasgulf rather than a separate corporate entity?

 A. No.

 Q.2. Who was the employer of the flight crew and the maintenance personnel for the aircraft that crashed?

 A. Texasgulf Aviation.

 Q.3. Who was the operator of the aircraft that crashed?

 A. Texasgulf Aviatioin.

 Q.4. In communicating with the estate representatives regarding the relationship between Texasgulf and Texasgulf Aviation or regarding the workers' compensation immunity defense, did Texasgulf or USAIG make any fraudulent misrepresentation or any material misrepresentation which was justifiably relied upon by the estate representatives while they were making their decision to sign the release?

 A. Yes.

 Q.5. In communicating or not communicating with the estate representatives regarding the existence of the American Home Insurance policy and the nature of its coverage, did Texasgulf or USAIG make any fraudulent misrepresentation or any material misrepresentation which was justifiably relied upon by the ...


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