NO. 03-16-00621-CV

IN THE THIRD COURT OF APPEALS

AT AUSTIN, TEXAS

_________________________________________________________________

TOLL AUSTIN TX, LLC

Appellant

v.

BRENT DUSING AND ELIZABETH DUSING

Appellees

__________________________________________________________________

On Appeal from the 353rd Judicial District Court

Travis County, Texas 

Cause No. D-1-GN-16-002196

__________________________________________________________________

APPELLANT’S RESPONSE TO APPELLEES’ BRIEF ON THE MERITS

__________________________________________________________________

Thomas R. Stauch; 

tstauch@ns-law.net 

State Bar No. 00794687

Mark C. Roberts II

mroberts@ns-law.net

State Bar No. 00788293

NOWAK & STAUCH, LLP

10000 North Central Expressway, Suite 1040

Dallas, Texas 75231

Telephone: (214) 823-2006

Facsimile: (214) 823-2007

Attorneys for Appellant

ACCEPTED

03-16-00621-CV

13888460

THIRD COURT OF APPEALS

AUSTIN, TEXAS

11/18/2016 6:44:16 PM

JEFFREY D. KYLE

CLERK

 FILED IN 3rd COURT OF APPEALS AUSTIN, TEXAS 11/18/2016 6:44:16 PM JEFFREY D. KYLE Clerk
ii

NO. 03-16-00621-CV

IN THE THIRD COURT OF APPEALS

AT AUSTIN, TEXAS

_________________________________________________________________

TOLL AUSTIN TX, LLC

Appellant

v.

BRENT DUSING AND ELIZABETH DUSING

Appellees

__________________________________________________________________

On Appeal from the 353rd Judicial District Court

Travis County, Texas 

Cause No. D-1-GN-16-002196

__________________________________________________________________

APPELLANT’S REPLY TO APPELLEES’ BRIEF ON THE MERITS

__________________________________________________________________

TO THE HONORABLE THIRD COURT OF APPEALS: 

COMES NOW, Toll Austin TX, LLC (“Toll”) in the above-styled 

numbered cause, and files its Reply to Appellees’ Brief on the Merits, and in 

support thereof shows the Court the following:
iii

TABLE OF CONTENTS

INDEX OF AUTHORITIES............................................................................iv

REPLY TO APPELLEES’ ISSUE NO. 1....................................................... 1

REPLY TO APPELLEES’ ISSUE NO. 2....................................................... 3

REPLY TO APPELLEES’ ISSUE NO. 3....................................................... 7

PRAYER............................................................................................................14

CERTIFICATE OF SERVICE .......................................................................15

CERTIFICATE OF COMPLIANCE ............................................................. 16

APPENDIX........................................................................................................17
iv

INDEX OF AUTHORITIES

Cases

Bonded Builders Home Warranty Association of Texas v. Rockoff, 2016 WL 3383461 

(Tex.App.—El Paso 2016, no pet.)..........................................................................6

Capitan Enters., Inc. v. Jackson, 903 S.W.2d 772 (Tex.App.—El Paso, writ denied) 6

Carlin v. 3V Inc., 928 S.W.2d 291 (Tex.App.—Houston [14th Dist.] 1996 no pet.)

....................................................................................................................... 10, 11

Chapman Custom Homes, Inc. v. Dallas Plumbing Co., 445 S.W.3d 716 (Tex. 

2014).....................................................................................................................11

Creative Artists Agency, LLC v. Las Palmas Race Part, LLC, 2015 WL 6652655 

(Tex.App.—Corpus Christi 2015)..........................................................................7

Greenberg Traurig, LLP v. National American Ins. Co., 448 SW.3d 115 (Houston 

[14th Dist.] 2014, no pet.)............................................................................... 10, 11

In re Koch Indus., 49 S.W3d 439 (Tex.App.—San Antonio 2001, org. proceeding) ..6

In re Weekley Homes, L.P., 180 S.W.3d 127 (Tex. 2005).........................................7

Jim Walter Homes, Inc. v. Reed, 711 S.W.2d 617 (Tex. 1986)...............................12

LAN/STV v. Martin K. Eby Constr. Co., 435 S.W.3d 234 (Tex. 2014)...................12

Merrill Lynch v. Eddings, 838 S.W.2d 874 (Tex.App.—Waco 1992, no writ) 

(emphasis added)........................................................................................... 10, 11

Mohamed v. Auto Nation USA Corp., 89 S.W.3d 830 (Tex.App.—Houston [1st Dist.] 

2002, no pet.)...........................................................................................................6

NextEra Retail of Tex., LP v. Investors Warranty of Am., Inc., 418 S.W.3d 222 

(Tex.App.—Houston [1st Dist] 2013, pet. denied).................................................8

Proctor v. Foxmeyer Drug Co., 884 S.W.2d 853 (Tex.App.—Dallas 1994, no writ)

....................................................................................................................... 3, 4, 5

Stonewall Ins. Co. v. Modern Exploration, Inc., 757 S.W.2d 432 (Tex.App.—

Dallas 1988, no writ)..............................................................................................6

Thompson v. North Tex. Nat’l Bank, 37 S.W.2d 735 (Tex. Comm’n.App. 1931, 

holding approved)...................................................................................................4

Walker Sand, Inc. v. Baytown Asphalt Materials, Ltd., 95 S.W.3d 511 (Tex.App.—

Houston [1st Dist.] 2002, no pet.) ...........................................................................1

Rules

TEX. CIV. PRAC. & REM. CODE §171.021(a)................................................................1

Tex. Civ. Prac. & Rem. Code §171.025 ..................................................................13
1

REPLY TO APPELLEES’ ISSUE NO. 1

Issue No. 1 of Appellees’ Brief contends that this Court should dismiss the 

instant appeal for lack of subject matter jurisdiction because the Trial Court’s 

Order is an unappealable interlocutory order. [Appellees’ Brief at 16]. According 

to the Dusings, Toll’s Plea in Abatement did not constitute a motion to compel 

arbitration because it only requested that the case be stayed in favor of arbitration 

instead of also requesting that arbitration be compelled. The Dusings contend that, 

without a request for an order compelling arbitration, there is no subject matter 

jurisdiction under Walker Sand, Inc. v. Baytown Asphalt Materials, Ltd., 95 

S.W.3d 511 (Tex.App.—Houston [1st Dist.] 2002, no pet.). The Dusings are 

incorrect because Toll’s Plea in Abatement was timely filed and specifically

requested that arbitration be ordered. 

Toll’s Plea in Abatement stated:

Pursuant to Section 171.021 of the TEXAS CIVIL PRACTICE & REMEDIES 

CODE, upon the showing of an agreement to arbitrate between these 

parties, the Court is required to order the parties to arbitrate. TEX. CIV.

PRAC. & REM. CODE §171.021(a). All of Plaintiffs’ claims against Toll 

Dallas (or Toll Austin) arise solely from either the Agreement of Sale or 

the Warranty. The Agreement of Sale and the Warranty contain valid 

and enforceable arbitration clauses. Accordingly, pursuant to 

§171.021(a) of the TEXAS CIVIL PRACTICE & REMEDIES CODE, Toll 

Austin respectfully requests that the Court abate these proceedings in 

favor of arbitration in accordance with the express terms of the 

Agreement of Sale and the Warranty.

[CR 12](emphasis added).
2

In addition to this request, Toll filed a Brief in Support of Plea in 

Abatement, which stated:

Toll has filed a verified Plea in Abatement and has moved the Court to 

compel arbitration based upon the arbitration clause contained in the 

both the Agreement of Sale and Home Builder’s Limited Warranty.... 

[CR 79](emphasis added).

In response, the Dusings filed a Response to the Plea in the Abatement, in 

which they twice argued against enforcement of the arbitration provision. The 

Dusings’ Response stated: “The Defendants could not enforce the agreement or

compel arbitration” and “...Plaintiffs contend that the Defendant’s (sic) arbitration

provision (Article 11) does not constitute a valid agreement with Plaintiffs, and as 

such, should not be enforced.” [CR 69].

Toll properly pleaded that it was seeking to compel arbitration in its Plea in 

Abatement; Toll’s Brief in Support of it Plea in Abatement expressly stated that 

Toll was seeking to compel arbitration; and the Dusings’ Response argued against 

Toll’s effort to compel arbitration. Clearly, the Dusings understood Toll’s Plea in 

Abatement sought to compel arbitration because their Response argued against it.

[CR 69]. Thus, Appellees’ argument that there was no motion to compel

arbitration is rather disingenuous, and wholly without merit.
3

REPLY TO APPELLEES’ ISSUE NO. 2

The Dusings are the successors in interest. Issue No. 2(A) of the Dusings’ 

Brief asserts that Toll is improperly applying the “boilerplate” contract term of 

“successor.” [Appellees’ Brief at 18]. Relying on Proctor v. Foxmeyer Drug Co., 

884 S.W.2d 853 (Tex.App.—Dallas 1994, no writ), the Dusings make a seemingly 

contradictory argument with respect to the term “successor.” On one hand, they 

argue that the term “successor” ordinarily applies to corporate entities. [Appellees’

Brief at 18]. Later, they quote Proctor as support for their argument that “that the 

definition of successor when applied to individuals is ‘intended to designate those 

to whom property descended through [a] deceased natural-person party to [an] 

agreement and extended perpetually to... descendants.’”1 [Appellees’ Brief at 19]. 

There are several reasons why the Dusings’ analysis is flawed.

First, the provision cited by the Dusings actually states that the agreement 

“shall be binding upon the respective heirs and successors of the parties.”

[CR22](emphasis added). If one substitutes the Dusings’ interpretation of the term 

“successor,” this phrase would read that the agreement “shall be binding upon the 

 1 Toll recognizes this quotation from Proctor, as edited by the Dusings, is awkwardly 

worded. Nevertheless, Toll is providing the edited quotation as it is worded in Appellees’ Brief. 

Moreover, the jump page provided in Appellees’ Brief is incorrect. The full, unedited quotation 

from Proctor is actually: “We further conclude that the term ‘successor’ was intended to 

designate those to whom property descended through a deceased natural-person party to this 

agreement. The option in Paragraph 6.9, therefore, extends perpetually to appellant’s 

descendants and is unlimited in duration.” Proctor, 884 S.W.2d at 861.
4

respective heirs and ones whom property descended through.” The term “heir” is 

the functional equivalent of the term “one whom property descended through.” 

Thus, they are interchangeable and when one makes this equivalent substitution, 

the phrase would functionally become: “the agreement shall be binding upon the 

respective heirs and heirs of the parties.” Because such an interpretation would be 

illogical, the term “successor” simply cannot mean what the Dusings assert it 

means.

Second, the only case that the Dusings rely on actually supports Toll’s 

position. In Proctor, the Dallas Court of Appeals held, “[t]he exact meaning of the 

word ‘successor’ when used in a contract depends largely on the kind and character 

of the contract, its purposes and circumstances, and the context.” Proctor, 884 

S.W.2d at 861 citing Thompson v. North Tex. Nat’l Bank, 37 S.W.2d 735, 739 

(Tex. Comm’n. App. 1931, holding approved). Under the character, purpose, 

circumstances, and context of the Agreement of Sale between Toll and Pool, the 

term “successor” clearly applies to the Dusings. The Agreement of Sale references 

“heirs,” “successors,” “buyer,” and “permanent residents of the Premises” at 

various points. [CR 21, 22]. Thus, the context, character, and purpose of the 

Agreement of Sale make clear that it was intended to provide for the resolution of 

all disputes between Toll and its customer, or anyone who might later acquire an 

ownership interest in the home. [CR 21, 22 at Articles 11 and 15(d)]. It is 
5

undisputed that the Dusings purchased the home from Pool, who purchased the 

home from Toll. [CR 4, 11 – 12]. Clearly, the Dusings are the “successor” 

homeowner, and the successors in interest to the property in question. This is the 

definition of vertical privity, and the Dusings cannot escape this vertical privity by 

seeking to deny the provisions of the Agreement of Sale for their convenience. 

Third, to the extent the Dusings contend that Proctor stands for the 

proposition that the term “successor” only applies to corporations, the Dusings are 

misinterpreting Proctor. A careful reading of Proctor reveals that, in the context 

of the contract at issue in that case, “the term ‘successor’ was also intended to 

apply to the natural-person parties of the agreement.” Proctor, 884 S.W.2d at 861

(emphasis in original). Thus, the very case the Dusings’ rely upon does not stand 

for the proposition that “successors” can only refer to corporate entities.

The Dusings, as successors in interest, acquired no more rights than Mr. 

Pool enjoyed as their predecessor in interest. In Issue No. 2(B), the Dusings 

attempt to distinguish Toll’s cases on the basis that they involve either corporate 

entities or involve assignments. [Appellees’ Brief at 21]. This attempt at 

distinguishment is misplaced for two reasons. First, as discussed immediately 

above, the term “successor” has never been, and is not here, limited to corporate 

entities. Id.
6

Second, the cases cited by Toll stand for the proposition that one who steps 

into the shoes of a predecessor, takes only those rights which the predecessor had. 

To demonstrate the broad expanse of this well-recognized legal principal, Toll 

cited cases where it has been applied in a wide range of contexts, including

“[a]ssignees, third party beneficiaries, and successors,” see Bonded Builders Home 

Warranty Association of Texas v. Rockoff, 2016 WL 3383461 *7 (Tex.App.—El 

Paso 2016, no pet.)(citations omitted)(emphasis added)), and also in the context of a 

“successor-in-interest.” (Mohamed v. Auto Nation USA Corp., 89 S.W.3d 830, 836 

(Tex.App.—Houston [1st Dist.] 2002, no pet.) citing Capitan Enters., Inc. v. Jackson, 

903 S.W.2d 772, 775 (Tex.App.—El Paso, writ denied)). Toll has further 

demonstrated that a party assuming contractual liability is liable to same extent as the 

party from which it assumed the contract, (In re Koch Indus., 49 S.W3d 439, 447 

(Tex.App.—San Antonio 2001, org. proceeding)), and that Texas law holds, “the 

beneficiary for whose advantage a contract is made cannot acquire a better 

standing to enforce the contract than that occupied by the contracting party itself.” 

Stonewall Ins. Co. v. Modern Exploration, Inc., 757 S.W.2d 432, 435 (Tex.App.—

Dallas 1988, no writ).

The unmistakable point that the foregoing cases collectively make is that 

when one steps into the shoes of another, one acquires the rights owned by one’s 

predecessor, and only those rights. Despite the Dusings’ attempt to artfully plead 
7

around the binding arbitration clause, the fact remains that all of their causes of 

action are based on Toll’s alleged defective design and construction and 

performance of the home. Toll’s liability for such design or construction arises 

only from the Agreement of Sale and the Warranty (which expressly disclaims any 

implied warranties). [CR 20 at Article 10]. Since both the Agreement of Sale and 

Warranty require arbitration of claims related to the design, construction or 

performance of the home, it is clear that Pool could not have avoided arbitration if 

he had brought these same claims against Toll. As a matter of law, therefore, the 

Dusings’ purchase of the home from Pool cannot, and did not, confer on the

Dusings any different (or greater) rights than Pool would have had concerning the 

assertion of these same claims against Toll. Like Pool, therefore, the Dusings are 

bound by the arbitration provisions as a matter of law.

REPLY TO APPELLEES’ ISSUE NO. 3

In Issue No. 3 of Appellees’ Brief, the Dusings contend they did not assume 

the Agreement of Sale and are not claiming a direct benefit of the Agreement of 

Sale. [Appellees’ Brief at 23]. The Dusings therefore assert that, as nonsignatories to the Agreement of Sale, they are not bound to arbitration provision of 

the Agreement of Sale. The Dusings then attempt to distinguish the cases Toll 

relied upon to refute this notion. As set forth below, the Dusings’ analysis misses 

the mark.
8

The Dusings are Bound under the Assumption Exception that Binds 

Non-Signatories to the Arbitration Agreements. Toll cited In re Weekley 

Homes, L.P., 180 S.W.3d 127, 130 (Tex.2005) and Creative Artists Agency, LLC v. 

Las Palmas Race Part, LLC, 2015 WL 6652655 *3-4 (Tex.App.—Corpus Christi 

2015) for the proposition that the Dusings are bound by the terms of the arbitration 

provisions set forth in the Agreement of Sale and Warranty under the “assumption” 

exception that binds non-signatories to arbitration agreements. The Dusings 

attempt to distinguish both of these on the basis that they involve corporate entities 

and a written assignment. 

As discussed above, the discussion of corporate entities versus individuals in 

the context of being “successors” under the Agreement of Sale is a distinction 

without difference. As for the issue of a written assignment, the Dusings did

receive a written assignment when they purchased the home from Pool. As set 

forth in the Warranty Deed from Pool to the Dusings dated February 2, 2015, Pool 

as grantor assigned his right, title and interest in the property to the Dusings as 

follows:

Grantor for the Consideration... grants, sells, and conveys to Grantee 

the Property, together will all and singular rights and appurtenances 

thereto in any way belonging, to have and to hold it to Grantee and 

Grantee’s heirs, successors, and assigns forever.2

 

 2

 See Warranty Deed with Vendor’s Lien in attached Appendix hereto. (Emphasis 

added). While this Warranty Deed was not part of the Trial Court’s Record, its absence is due to 

the fact that the Dusings failed to produce any evidence at the Trial Court, and Toll could not 
9

Thus, when the Dusings took the home along with all “rights and appurtenances 

thereto” for themselves and for their “heirs, successors, and assigns,” they were 

taking an assignment of the bundle of rights that Pool had to give, including those 

arising under the Agreement of Sale and Warranty. This transfer created the 

vertical privity between Toll and the Dusings that made the Dusings the 

“successors” to Pool, who are therefore bound to the arbitration provisions in the 

Agreement of Sale and the Warranty.

Even without this assignment in the Warranty Deed, the Dusings still 

impliedly assumed the Agreement of Sale and the Warranty. The Dusings’ lawsuit 

against Toll claims a breach of duties by Toll that only arise from the Agreement 

of Sale or the Warranty as a matter of law. “An implied assumption of contractual 

obligations may arise ‘when the benefit received by the assignee is so entwined 

with the burden imposed by the assignor’s contract that the assignee is estopped 

from denying assumption and the assignee would otherwise be unjustly 

enriched.’” Creative Artists Agency, LLC v. Las Palmas Race Part, LLC, 2015 

WL 6652655 *3-4 (Tex.App.—Corpus Christi 2015) quoting NextEra Retail of 

Tex., LP v. Investors Warranty of Am., Inc., 418 S.W.3d 222, 227-228 (Tex.App.—

 

have reasonably foreseen the Dusings would deny their standing in the chain of title as an 

assignee of Pool’s rights. As such, the Dusings should be barred from raising this issue herein. 

Moreover, this Court may also take judicial notice of the Warranty Deed which is filed as 

Document Number 2015017005 in the Deed Records of Travis County, Texas. 
10

Houston [1st Dist] 2013, pet. denied). Simply put, without the Agreement of Sale, 

there would have been no construction of the home and the Warranty expressly 

states that Toll’s duty to Pool (and his successors) after closing are governed by 

solely by the Warranty. [CR 20 at Article 10]. Any suit for defects in the home 

must, therefore, be subject to all of the provisions of the Agreement of Sale and 

Warranty, including the arbitration provision. 

Equitable Estoppel and Direct Benefits. The Dusings continue to resist

the authority cited by Toll on the equitable estoppel/direct benefits exception to the 

non-signatory exemption on the basis that Toll’s cases involve corporate entities or 

an express assignment. [Appellees’ Brief at 27]. Because those issues are briefed 

above, Toll will not brief the issues again here. However, the Dusings also attempt 

to avoid application of the equitable estoppel/direct benefits exception by claiming 

that their causes of action sound in tort rather than in contract. As such, the 

Dusings assert they are not claiming benefits under the Agreement of Sale or the 

Warranty at all. [Appellees’ Brief at 27] This argument was flatly rejected in 

Weekley Homes which states: “[W]hether a claim seeks a direct benefit from a 

contract containing an arbitration clause turns on the substance of the claim, not 

artful pleading.” Weekley Homes, 180 S.W.3d at 131–32 (emphasis added).

Although the Dusings have carefully attempted to avoid suing Toll for breach 

of contract or breach of warranty, all of their claims arise from Toll’s alleged failure 
11

to “properly design and construct the foundation, French drainage system, and 

waterproofing” of the home. [CR 5-6]. Any duty to properly design or construct the 

home arose only from the Agreement of Sale, and any duty to remedy such defects 

arises only from the Warranty. Thus, despite their artful pleadings, any cause of 

action asserted by the Dusings against Toll related to the construction of the home are 

expressly covered by the arbitration provision set forth in the Agreement of Sale. In 

fact, the arbitration clause in the Agreement of Sale even contemplates the inclusion 

of tort claims in the requirement to arbitrate:

Buyer, on behalf of Buyer and all permanent residents of the Premises, 

including minor children, hereby agree that any and all disputes with 

Seller, Seller’s parent company or their subsidiaries or affiliates arising 

out of the Premises, this Agreement, the Home Warranty, any other 

agreements, communications or dealings involving Buyer, or the 

construction or condition of the Premises including, but not limited to, 

disputes concerning breach of contract, express or implied warranties, 

fraud, misrepresentation, personal injuries and/or illness, mold-related 

claims, representations and/or omission by Seller, on-site and off-site 

conditions and all other torts and statutory causes of action, including 

but not limited to those arising or administered under the Deceptive 

Trade Practices Act (DTPA), Residential Construction Liability Act 

(RCLA) or Texas Residential Construction Commissions Act 

(TRRCA)(the “Claims”) shall be resolved by binding arbitration...

[CR 21]. Based on this language, and despite the Dusings’ attempt to artfully plead 

their claims to avoid arbitration, it is clear that the Dusings’ claims against Toll must 

be arbitrated.

Indeed, in Carlin v. 3V, the Fourteenth Court of Appeals compelled 

arbitration because 3V “based its entire case on the rights it acquired from the 
12

[Carlin and SIGMA] agreement and would have no case if it did not exist.” Carlin 

v. 3V Inc., 928 S.W.2d 291, 295 (Tex.App.—Houston [14th Dist.] 1996 no pet.). 

Similarly, in Merrill Lynch v. Eddings, the Tenth Court of Appeals compelled 

arbitration because the “underlying basis for all of the claims” and the 

beneficiaries “would have no claims had the account agreement never been signed 

by the trustee.” Merrill Lynch v. Eddings, 838 S.W.2d 874, 879 (Tex.App.—Waco 

1992, no writ) (emphasis added). Here, the Dusings’ claims are likewise derivative 

of the original contractual relationship between Toll and Pool. In Greenberg 

Traurig, LLP, v. National American Ins. Co., the Fourteenth Court of Appeals 

compelled arbitration because:

Okie’s claims are based on the retainer agreement.... Each claim that 

Okie asserts—negligence, malpractice, and breach of fiduciary duty—

is based on Greenberg’s legal representation of Okie, which arises out 

of the agreement.... Because Okie insists that Greenberg violated 

various duties owed to Okie as a client, it cannot avoid the arbitration 

provision in the agreement providing for Okie’s legal representation.

Greenberg Traurig, LLP v. National American Ins. Co., 448 SW.3d 115, 121 

(Houston [14th Dist.] 2014, no pet.). In the present case, it is clear that but for the 

Agreement of Sale between Toll and Pool, the home in question would never have 

been constructed and warranted by Toll. Accordingly, despite their counsel’s 

clever attempts to avoid asserting contractual claims, all of the Dusings’ alleged 

claims arise from, and are inextricably tied to (and bound by) the Agreement of 

Sale and the Warranty. As was the result in Carlin v. 3V, 
13

Eddings, and Greenberg Traurig, LLP, v. National American Ins. Co., arbitration 

of the Dusings’ claims against Toll should be compelled.

The Economic Loss Rule precludes the Dusings’ tort claims. The 

Dusings’ contention the economic loss rule’s bar of tort claims would not apply in 

this case is misplaced. The contention relies solely upon Chapman Custom 

Homes, Inc. v. Dallas Plumbing Co., 445 S.W.3d 716 (Tex. 2014), the facts of 

which are distinguishable and thus rendering the opinion irrelevant and unable to 

alter the proper result in this case. 

Dallas Plumbing involved a plumbing subcontractor who contracted with 

the general contractor to install plumbing in the construction of a new home. Id. at 

717. Thus, the relevant contract in that case was a subcontract for installation of 

the plumbing within the home rather than the builder’s contract with the buyer for 

the construction of the entire home. When flooding occurred due to a plumbing 

defect, the damage exceeded the scope of the applicable plumbing subcontract 

because damage was done to the structure of the home. Id. Thus, the Texas 

Supreme Court held that the economic loss rule did not apply because “a party 

states a tort claim when the duty allegedly breached is independent of the 

contractual undertaking and the harm suffered is not merely the economic loss of a 

contractual benefit.” Dallas Plumbing, 445 S.W.3d at 718. The Court noted that 

the “damages allegedly caused by the breach of [the] duty extend beyond the 
14

economic loss of any anticipated benefit under the plumbing contract.” Id.

(emphasis added).

In the Dusings’ case, the subject of the Agreement of Sale was the 

construction, sale and warranty of the entire home. Thus, every complaint and all 

damages claimed by the Dusings in this case are associated with the economic loss 

of the original contractual expectancy under the Agreement of Sale. Under 

LAN/STV v. Martin K. Eby Constr. Co., 435 S.W.3d 234 (Tex.2014) and Jim 

Walter Homes, Inc. v. Reed, 711 S.W.2d 617, 618 (Tex. 1986), the economic loss 

rule would indeed bar any tort claims by the Dusings. Any potential recovery of 

damages by the Dusings, even if currently couched as a tort claim, is therefore 

governed by the contractual limitations in the Agreement of Sale. The equitable 

estoppel and direct benefits exception applies and requires arbitration of the 

Dusings’ claims because all of the Dusings’ claims against Toll, to the extent they 

are viable, must rise or fall under the duties created in the Agreement of Sale and 

the Warranty.

PRAYER

FOR THESE REASONS, Toll requests this Court find that the Trial Court

erred in denying Toll’s Plea in Abatement. Toll further requests this Court reverse 

the Trial Court’s denial of the Plea in Abatement; render an Order granting the 

Plea in Abatement and ordering the Dusings’ to arbitrate their claims with Toll; 
15

and stay the underlying proceedings in the Trial Court under Tex. Civ. Prac. & 

Rem. Code §171.025 until an award is rendered in arbitration as appropriate. Toll 

seeks such other and further relief, including is reasonable and necessary attorney 

fees and costs of appeal, to which it may be justly entitled.

Respectfully submitted,

NOWAK & STAUCH, LLP

/s/ Thomas R. Stauch

Thomas R. Stauch

tstauch@ns-law.net

State Bar No. 00794687

Mark C. Roberts II

mroberts@ns-law.net

State Bar No. 00788293

10000 North Central Expressway, Suite 

1040

Dallas, Texas 75231

Telephone: (214) 823-2006

Facsimile: (214) 823-2007

ATTORNEYS FOR APPELLANT

CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of the foregoing document was 

served in accordance with TEXAS RULES OF CIVIL PROCEDURE 21 and 21a 

on all parties to this case on this the 18th day of November, 2016.

 /s/ Mark C. Roberts II . .

Mark C. Roberts II
16

CERTIFICATE OF COMPLIANCE

I certify that Appellant’s Response to Appellees’ Brief on the Merits is in 

compliance with to Texas Rule of Appellate Procedure 9.4(i) as it contains 3,376 

words in the document.

 /s/ Mark C. Roberts II . .

Mark C. Roberts II
17

NO. 03-16-00621-CV

IN THE THIRD COURT OF APPEALS

AT AUSTIN, TEXAS

_________________________________________________________________

TOLL AUSTIN TX, LLC

Appellant

v.

BRENT DUSING AND ELIZABETH DUSING

Appellees

__________________________________________________________________

On Appeal from the 353rd Judicial District Court

Travis County, Texas 

Cause No. D-1-GN-16-002196

__________________________________________________________________

APPELLANT’S APPENDIX

__________________________________________________________________

Pursuant to Texas Rule of Appellate Procedure 38.1(k), the item listed below 

is contained in the Appendix:

Warranty Deed with Vendor’s Lien
ELECTRONICALLY RECORDED 

TRV 3 

2015017005 

PGS 

NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, 

YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION 

FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY 

BEFORE IT IS FILED ·FOR RECORD IN THE PUBLIC RECORDS: YOUR 

SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER. 

02>-0\.Ql\l-3L\1Q.ct .. '\2>o~- ~ Warranty Deed with Vendor's Lien 

Date: February,?... , 2015 

Gran tor: Brodney Pool and Kady Pool 

Grantor's Mailing Address: 

Grantee: Brent William Dusing and Edith Dusing 

Grantee's Mailing Address: ~ff N~~ \!_, 

Consideration: A Promissory Note in the original principal sum of Seven Hundred 

Twelve Thousand Five Hundred and No/100 Dollars ($712,500.00) 

payable to the order of Pioneer Bank, SSB ("Lender"), which Promissory 

Note is secured by a Deed of Trust of even date to Ruth W. Gamer, 

Trustee. 

The debt evidenced by said Note is in part payment of the purchase price of the Property. The 

debt is secured by a deed of trust and by a vendor's lien on the Property, which is expressly 

retained. The lien created by the deed of trust and the vendor's lien is transferred to Lender by 

this deed. The deed of trust does not waive the vendor's lien, and the two liens and the rights 

created by said deed of trust are cumulative. Lender may elect to foreclose under either of the 

liens without waiving the other or may foreclose under both. 

Property (including any improvements): 

Lot 4, Block D, of AMENDED PLAT OF LOTS I-13, BLOCK D, LOTS 1-13, BLOCK 

· F, LOTS 1 & 2, BLOCK G, OF WERKENTHIN SECTION TIIREE, AND LOT 14, 

BLOCK F, OF WERKENTHIN SECTION FIVE, a subdivision in Travis County, Texas, 

according to the map or plat of record in Document Number 200000126, of the Official 

Public Records of Travis County, Texas. 

Reservations from Conveyance: None 

GF#OI247-34729-JW 
Exceptions to Conveyance and Warranty: 

Liens, if any, described as part of the Consideration and any other liens described in this 

deed as being either assumed or subject to which title is taken; validly existing easements, rightsof-way, and prescriptive rights, whether of record or not; all presently recorded and validly 

existing instruments, other than conveyances of the surface fee estate, that affect the Property; 

and taxes for the current year, which Grantee assumes and agrees to pay. 

Grantor, for the Consideration and subject to the Reservations from Conveyance and the 

Exceptions to Conveyance and Warranty, grants. sells, and conveys to Grantee the Property, 

together with all and singular the rights and appurtenances thereto in any way belonging, to have 

and to hold it to Grantee and Grantee's heirs, successors, and assigns forever. Grantor binds 

Grantor and Grantor's heirs and successors to warrant and forever defend all and singular the 

Property to Grantee and Grantee's heirs, successors, and assigns against every person 

whomsoever lawfully claiming or to claim the same or any part thereof, except as to the 

Reservations from Conveyance and the Exceptions to Conveyance and Warranty. 

Lender, at Grantee's request, has paid in cash to Grantor that portion of the purchase 

price of the Property that is evidenced by the note. The first and superior vendor's lien against 

and superior title to the Property are retained for the benefit of Lender and are transferred to 

Lender without recourse against Grantor. 

The vendor's lien against and superior title to the Property are retained until each note 

described is·fully paid according to its terms, at which time this deed will become absolute. 

When the context requires, singular nouns and pronouns include the plural. 

B'rodn~l 1 

GF#O 1247-34729-JW 
STATE OF TEXAS 

COUNTY OF\~~\'5 

) 

) 

This instrument was acknowlooged before me February~ 2015, by Brodney Pool and 

Kady Pool. 

GF#Ol247-34729-I\V 

No ~WteofTexas 

FILED AND RECORDED 

OFFICIAL PUBLIC RECORDS 

ll,;r-c~w...,«ib.r"L 

DANA DEBEAUVOIR, COUNTY CLERK 

TRAVIS COUNTY, TEXAS 

· February 04 2015 04:32 PM 

FEE:$ 34.00 2015017005