Court Opinion

ID: 2951934
Source: CourtListenerOpinion
Date Created: 2015-09-16 21:57:14.27423+00
Date Added: 2024-06-11T11:36:08.765697
License: Public Domain

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

                                      NO. 03-09-00578-CV

                              Robert H. Osburn, P.C., Appellant

                                                 v.

                               Realty Engineering, Inc., Appellee

              FROM COUNTY COURT AT LAW NO. 2 OF COMAL COUNTY
      NO. 2007CV0590, HONORABLE CHARLES A. STEPHENS II, JUDGE PRESIDING

                            MEMORANDUM OPINION

               Robert H. Osburn appeals the judgment of the county court at law awarding damages

for breach of contract to Realty Engineering, Inc., and determining that Osburn take nothing from

Realty on his negligence claim. On appeal, Osburn contends that Realty’s engineering license was

suspended at the time the contract was signed, rendering the contract void as against public policy,

illegal, and unenforceable. He also contends that the judgment as to his negligence claim was

against the great weight and preponderance of the evidence. We affirm.

               The parties entered a contract for Realty to provide expert witness services

in a lawsuit concerning a structure at an apartment building.         The parties agree that the

contract—signed by Osburn and Norman Cooper, Realty’s sole stockholder—was signed sometime

in early February 2005. Cooper inspected the property on February 25, 2005, issued his report on

May 26, 2005, and testified at his deposition on August 15-16, 2005. Cooper testified that the
building inspector for the City of Bedford told him that the Uniform Building Code applied at

the time of construction. He did not obtain written materials from the City before his deposition,

but did obtain them afterwards. He then learned that the Standard Building Code was in effect at

the time of construction. Cooper admitted that he could have made the request for written materials

before he wrote his report or testified at his deposition. Cooper testified that he did not supplement

his report after his deposition because his client—Osburn—did not authorize him to do that. Cooper

testified, however, that his misunderstanding of what code was in effect when the building was

built made no difference because (1) the code that is in effect at the date of injury is the applicable

code and (2) the Standard and Uniform codes had the same relevant standard for the engineering

issue in dispute.

               Osburn testified that, when he learned that the wrong code was identified in the

report, he knew that Cooper would be impeachable on the witness stand. Even though Cooper felt

he could explain away the misidentified code, Osburn decided to get a new expert in a case he

described as hotly contested. Osburn testified that he hired an architect as an expert and paid him

$15,000. The case for which both experts were hired settled on the eve of trial.

               Osburn noted that his decision to seek a new expert was reinforced when he learned

from opposing counsel that Cooper was not “a registered engineer in his firm.” Osburn contends that

Realty’s engineering license fee was not timely paid by January 31, 2005, and that this renders any

contract for engineering services entered into by Realty void. Osburn sought on cross-examination

for Cooper to admit that, from January 31 to March 23, 2005, Cooper was not a licensed professional

engineer. Cooper refused. He conceded that Realty paid a $500 administrative penalty to the State

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because it had not properly paid a fee that was due. Cooper testified, “What I remember is that this

never was a question of my engineering from my personal license as an engineer and my practice as

an engineer and as an individual. This was only for the corporation’s license with the state.” Cooper

testified that he was not informed that Realty’s license was revoked or suspended, only that he had

to pay a $500 fine to get it renewed.

               Osburn asked Cooper to waive his fees because of the code misidentification. Osburn

paid Realty for Cooper’s services from February through August 2005. Cooper sued for the

remainder of the contracted fee and prevailed. Osburn appeals.

               Osburn does not dispute that he entered a contract with Realty, but argues that

the contract should not be enforced. He contends that, because Realty failed to timely pay its

engineering license fee before the contract was signed, the trial court should have refused to enforce

the contract as illegal or against public policy. Osburn’s argument is an affirmative defense for

which he bore the burden of proof. Review of whether a contract violates public policy is a question

of law, which is reviewed de novo. Johnson v. Structured Asset Servs., LLC, 148 S.W.3d 711, 726

(Tex. App.—Dallas 2004, no pet.). The rule that public policy precludes the enforcement of an

otherwise valid contract should be applied cautiously and only in cases involving dominant public

interests. Id.; Yancey v. Floyd West & Co., 755 S.W.2d 914, 924 (Tex. App.—Fort Worth 1988,

writ denied). Contracts are subject to the public policy of the State. Johnson, 148 S.W.3d at 726.

A state’s public policy is embodied in its constitution, statutes, and the decisions of its courts. Id.

at 727; Texas Commerce Bank, N.A. v. Grizzle, 96 S.W.3d 240, 250 (Tex. 2003). In examining an

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agreement to determine if it is contrary to public policy, we look to whether the agreement has a

tendency to injure the public good. Johnson, 148 S.W.3d at 726-27.

                Osburn failed to put on evidence that requires a conclusion that the contract was void.

Osburn asserts that Realty violated the occupations code provisions setting out the procedure by

which persons licensed as professional engineers are to renew their licenses. See Tex. Occ. Code

Ann. § 1001.353 (West Supp. 2009). It is not clear that section 1001.353 applies to corporations.

It applies to “persons” who have an engineering license. Id. Although corporations are deemed

persons for some purposes, we are not persuaded a corporation can fulfill the licensing requirements

that include the following: graduating from an approved engineering curriculum or recognized

institution of higher learning, passing an examination (or having the requirement waived), engaging

in the active practice of engineering for a specified period, having a completed application approved,

and paying required fees. See id. §§ 1001.302-.305, .308 (West 2004). The only evidence is that

Cooper, the expert witness whose services Realty provided, was a licensed engineer during

the entirety of the contract. Cooper conceded that Realty had paid a fine for late payment of a fee,

but Osburn did not and does not present authority compelling a conclusion that a late payment of

this unspecified fee voids any contract Realty entered while the fee remained unpaid.1 There is no

documentary evidence in the record regarding a late-paid fee or a suspended or expired license

or registration for either Cooper or Realty. Whatever fee was late, it was undisputedly paid by

        1
          There is a separate registration requirement for business entities engaging in the practice
of engineering. See Tex. Occ. Code Ann. § 1001.405 (West 2004). Although it is not clear what
the effect of a late payment is on the ability to form a contract, that statute and theory is not cited or
relied on by Osburn and cannot form the basis for reversal. See Tex. R. App. P. 33.1(a)(1), 38.6(i).

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March 23, 2005, well before Cooper performed the expert witness services of filing his expert report

in May 2005 and testifying at his August 2005 deposition. Osburn has not demonstrated that the

contract to supply an expert witness was rendered void, illegal, or against public policy by the late

payment of an unspecified fee. He has not shown that the trial court erred by granting judgment to

Realty for breach of contract.

               Osburn contends that the trial court’s judgment on his negligence claim was against

the great weight and preponderance of the evidence. When a party attacks the factual sufficiency of

an adverse finding on an issue on which it has the burden of proof, it must demonstrate on appeal

that the adverse finding is against the great weight and preponderance of the evidence. Dow Chem.

Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001). To recover on a negligence theory, Osburn must

establish the existence of a duty, a breach of that duty, and damages proximately caused by the

breach. Western Invs., Inc. v. Urena, 162 S.W.3d 547, 550 (Tex. 2005). The trial court did not

specify on what basis it denied the negligence claim. Osburn cites Cooper’s admission that he relied

on an oral representation by the City of Bedford’s building inspector that the Uniform Building Code

applied to the apartments’ construction and that he did not obtain written materials or do other

research to determine the applicable building code before writing his report or testifying at

deposition. It was eventually discovered that the Standard Building Code applied. Osburn testified

that errors in expert reports are serious and that Cooper’s actions made him impeachable on the

witness stand. Consequently, Osburn chose to hire a new expert for $15,000 to redo Cooper’s work.

               The trial court’s judgment is supported by an implied finding that Cooper’s failure

to get written confirmation of the applicable building code did not proximately cause Osburn’s

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damages. That implied finding is supported by Cooper’s testimony that his error regarding the

applicable building code was (1) explainable, due to his reliance on the City of Bedford’s building

inspector, (2) rectifiable, through amendment of the report, and (3) inconsequential, given the

similarities of the building codes. Cooper testified that he offered, but was not authorized by

Osburn, to update his report to use the correct building code. Osburn’s testimony regarding the

serious nature of errors in expert reports and his decision to hire a new expert does not constitute a

great weight or preponderance of evidence in favor of a negligence finding. We conclude that the

trial court’s judgment that Osburn take nothing by his negligence claim is not against the great

weight and preponderance of the evidence.

               Affirmed.

                                               G. Alan Waldrop, Justice

Before Chief Justice Jones, Justices Pemberton and Waldrop

Affirmed

Filed: August 6, 2010

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