Court Opinion

ID: 2855712
Source: CourtListenerOpinion
Date Created: 2015-09-04 18:48:17.626396+00
Date Added: 2024-06-11T11:31:00.413719
License: Public Domain

COURT OF APPEALS
                          SECOND DISTRICT OF TEXAS
                               FORT WORTH

                               NO. 2-08-436-CV

PATRICK J. IRWIN AND SONDRA                                      APPELLANTS
IRWIN

                                        V.

NORTEX FOUNDATION DESIGNS,                                         APPELLEES
INC. AND JERRY COFFEE, P.E.

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           FROM THE 393RD DISTRICT COURT OF DENTON COUNTY

                                    ------------

                         MEMORANDUM OPINION 1

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                                I. INTRODUCTION

      The trial court granted summary judgment for Appellees Nortex

Foundation Designs, Inc. and Jerry Coffee, P.E. on the breach of implied

warranty and negligence claims of Appellants Patrick J. Irwin and Sondra Irwin.

      1
          … See Tex. R. App. P. 47.4.
In four issues, Appellants argue that the trial court improperly granted the final

summary judgment. We will affirm.

                   II. F ACTUAL AND P ROCEDURAL B ACKGROUND

      Appellants purchased a home located in Flower Mound from Randy Bollig

Builder, Inc. Bollig constructed the home; Nortex had contracted with Bollig to

design the home’s foundation; and Coffee, a Nortex employee, had stamped the

engineer-designed plans for the home’s foundation on behalf of Nortex. Home

Owners Management Enterprises, Inc. d/b/a Home of Texas and Warranty

Underwriters Insurance Company (collectively “HOME”) issued a homeowner’s

insurance policy on the home. Appellants never had a contract with Appellees.

      Appellants moved into the home in April 2002. In August 2006, they

sued Bollig and HOME for alleged construction defects to the home. According

to their third amended petition, the home had “sustained substantial movement

of the foundation systems and footings, load-bearing beams, girders, lintels,

columns, bearing walls, floor framing members[,] and roof framing members”

and had shifted and cracked to such an extent “as to vitally affect the use of

the home for residential purposes.” Appellants averred that these and other

defects in the home constituted “Major Structural Defects.”

      In October 2006, the trial court abated the case for arbitration between

Appellants, Bollig, and HOME, and Appellants sued Appellees. The case was

                                        2
eventually reinstated, and Appellants alleged in their third amended petition that

Appellees negligently designed the foundation and breached their “common law

implied warranties that the foundation was designed in a good and workmanlike

manner.” 2

      In October 2007, HOME paid Appellants $375,000 to settle Appellants’

claims against them.3      Thereafter, Appellees filed a motion for summary

judgment on Appellants’ breach of implied warranty and negligence claims.

Appellees argued that Texas law does not recognize Appellants’ implied

warranty claim and that Appellants failed to allege the negligence action within

the applicable two-year limitations period.    Appellees also sought summary

judgment under the “one satisfaction rule,” arguing that Appellants had been

fully compensated for all of their damages. The trial court granted Appellees’

motion for summary judgment. Appellants filed a motion for new trial, which

was overruled by operation of law, and this appeal followed. See Tex. R. Civ.

P. 329b(c).

      2
      … This petition omitted Bollig, who filed a “suggestion of bankruptcy”
in May 2007, as a named defendant.
      3
          … Appellees were not part of the settlement agreement.

                                        3
                           III. S TANDARD OF R EVIEW

      In a summary judgment case, the issue on appeal is whether the movant

met the summary judgment burden by establishing that no genuine issue of

material fact exists and that the movant is entitled to judgment as a matter of

law. Tex. R. Civ. P. 166a(c); Sw. Elec. Power Co. v. Grant, 73 S.W.3d 211,

215 (Tex. 2002); City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671,

678 (Tex. 1979). The burden of proof is on the movant, and all doubts about

the existence of a genuine issue of material fact are resolved against the

movant. Sw. Elec. Power Co., 73 S.W.3d at 215.

      When reviewing a summary judgment, we take as true all evidence

favorable to the nonmovant, and we indulge every reasonable inference and

resolve any doubts in the nonmovant’s favor.           Valence Operating Co. v.

Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). Evidence that favors the movant’s

position will not be considered unless it is uncontroverted. Great Am. Reserve

Ins. Co. v. San Antonio Plumbing Supply Co., 391 S.W.2d 41, 47 (Tex. 1965).

But we must consider whether reasonable and fair-minded jurors could differ in

their conclusions in light of all of the evidence presented. See Wal-Mart Stores,

Inc. v. Spates, 186 S.W.3d 566, 568 (Tex. 2006); City of Keller v. Wilson, 168
S.W.3d 802, 822–24 (Tex. 2005). The summary judgment will be affirmed

only if the record establishes that the movant has conclusively proved all

                                       4
essential elements of the movant’s cause of action or defense as a matter of

law. Clear Creek Basin Auth., 589 S.W.2d at 678.

                             IV. IMPLIED W ARRANTY

      In their first issue, Appellants argue that the trial court erred by granting

summary judgment on the claim that Appellees breached their common law

warranty that they designed Appellants’ foundation in a good and workmanlike

manner.    Appellants acknowledge this court’s opinion in Glenn v. Nortex

Foundation Designs, Inc., which (1) recognized that Texas courts have

consistently held that a property owner may not recover from a subcontractor

with whom the owner had no direct contractual relationship,4 (2) observed that

this court had specifically held that a homeowner’s implied warranty claim

against a subcontractor is barred as a matter of law,5 and (3) held that in a suit

by a homeowner against a licensed structural engineer, it is not an exception

to the rule that a homeowner has no claim for breach of an implied warranty

against a subcontractor “where the structural engineer, who designed the

foundation and applied his engineering seal to the foundation plans, failed to

      4
      … See J.M. Krupar Constr. Co. v. Rosenberg, 95 S.W.3d 322, 332 (Tex.
App.—Houston [1st Dist.] 2002, no pet.); Raymond v. Rahme, 78 S.W.3d 552,
563 (Tex. App.—Austin 2002, no pet.); Codner v. Arellano, 40 S.W.3d 666,
672–74 (Tex. App.—Austin 2001, no pet.).
      5
     … See Rayon v. Energy Specialties, Inc., 121 S.W.3d 7, 21 (Tex.
App.—Fort Worth 2002, no pet.).

                                        5
properly design the foundation upon which the future homeowner’s home

would rest.”     No. 02-07-00172-CV, 2008 WL 2078510, at *3 (Tex.

App.—Fort Worth May 15, 2008, no pet.) (mem op.).

      Nonetheless, and notwithstanding the obvious similarities between the

status of the parties in this case and the parties in Glenn, 6 Appellants argue that

an implied warranty of good workmanship should be imposed in this case

because their remedy against Bollig, the builder of the home, was nullified by

its bankruptcy, thus creating a compelling need for recognizing the warranty

against Appellees. As support for this argument, Appellants rely on language

in Codner, which states that “[a]n implied warranty will not be imposed unless

there is a demonstrated, compelling need for it” and that “[i]t is not necessary

to impose an implied warranty as a matter of public policy if the plaintiff has

other adequate remedies to redress the alleged wrongs committed by the

defendant.” 40 S.W.3d at 672 (citing Rocky Mountain Helicopters, Inc. v.

Lubbock County Hosp. Dist., 987 S.W.2d 50, 53 (Tex. 1998)); see also Trans-

Gulf Corp. v. Performance Aircraft Servs., Inc., 82 S.W.3d 691, 696–97 (Tex.

      6
       … Appellants are homeowners just like the appellant in Glenn. See 2008
WL 2078510, at *1. And Appellees, an engineering firm and licensed
structural engineer who contracted with the builder of the home—not the
homeowner—to design the home’s foundation, are the same appellees as in
Glenn. See id.

                                         6
App.—Eastland 2002, no pet.) (stating that public policy does not justify

imposing an implied warranty for service transactions in the absence of a

demonstrated, compelling need).

      The court of appeals in Codner declined to apply, as a matter of public

policy, an implied warranty between a subcontractor and a homeowner because

the appellant “clearly had adequate remedies to redress the wrongs he

allege[d]” against the subcontractor. 40 S.W.3d at 674. Similarly, in Glenn,

this court declined to apply an implied warranty between the homeowner and

the subcontractor who designed the homeowner’s alleged flawed foundation

in part because the homeowner had recovered via an arbitration award over

$227,000 in damages from the builder of the home and the insurance

company. 2008 WL 2078510, at *1, 3. In this case, Appellants have already

recovered $375,000 as a result of settling their claims against HOME for the

defects to their home.     Appellants recovered the $375,000 from HOME

notwithstanding Bollig’s filing a “declaration of bankruptcy.” Thus, like in Glenn

and Codner, Appellants have an “other adequate remed[y] to redress the alleged

wrongs committed by” Appellees. See Codner, 40 S.W.3d at 672.

      Appellants contend that their mediation and settlement with HOME was

“not an adequate remedy” because their damages exceed $700,000, excluding

attorneys’ fees and punitive damages, and because they continued to have

                                        7
claims pending against Appellees. But Appellants’ opinion that they are entitled

to recover an amount greater than the $375,000 they recovered from HOME

does not obviate their remedy and recovery against HOME.

      Appellants have no compelling need that justifies imposing an implied

warranty in this case in light of their settlement with HOME, an entity with

whom Appellants had a contract.        See Rocky Mountain Helicopters, 987
S.W.2d at 53; Glenn, 2008 WL 2078510, at *3. Accordingly, we hold that the

trial court did not err by granting Appellees’ motion for summary judgment on

Appellants’ implied warranty claim. We overrule Appellants’ first issue.

                                V. N EGLIGENCE

      In their second issue, Appellants argue that the trial court erred by

granting summary judgment on their negligence claim.         They contend that

Appellees failed to plead the affirmative defense of limitations in their answer

and that there is a genuine issue of material fact regarding when they knew or

should have known that Appellees had allegedly negligently designed their

home’s foundation.

      A.    No Objection to Limitations Affirmative Defense

      Appellees did not plead the affirmative defense of limitations in their

original answer (which is their only answer in the record), but they included the

following bold heading and statement in their motion for summary judgment:

                                       8
             V. SUPPLEMENTAL ANSWER AND DISCLOSURES

      25. Defendants do hereby supplement their latest answer and all
      disclosures with all defensive theories and claims presented in this
      motion.

By arguing that Appellees are not entitled to summary judgment on their

limitations affirmative defense because they failed to plead the defense in an

answer, Appellants implicitly contend that the above statement contained in the

motion for summary judgment is insufficient to properly plead the affirmative

defense. See Tex. R. Civ. P. 94. We need not decide whether this statement

is sufficient to plead the affirmative defense of limitations, however, because

Appellants never objected to Appellees’ alleged failure to plead the defense.

      An unpleaded affirmative defense may serve as the basis for a summary

judgment when it is raised in the summary judgment motion and the opposing

party does not object in writing to the lack of a rule 94 pleading. Roark v.

Stallworth Oil & Gas, Inc., 813 S.W.2d 492, 494–95 (Tex. 1991) (reasoning

that the failure to plead an affirmative defense under rule 94 is an issue that

must be raised in the trial court or it may not be urged on appeal); see

McConnell v. Southside ISD, 858 S.W.2d 337, 341 (Tex. 1993) (“[I]ssues a

nonmovant contends avoid the movant’s entitlement to summary judgment

must be expressly presented by written answer to the motion or by other

written response to the motion and are not expressly presented by mere

                                       9
reference to summary judgment evidence.”); Red Roof Inns, Inc. v. Murat

Holdings, L.L.C., 223 S.W.3d 676, 688 (Tex. App.—Dallas 2007, pet. denied).

If the nonmovant does not object to a variance between the motion for

summary judgment and the movant’s pleadings, it would advance no compelling

interest of the parties or of our legal system to reverse a summary judgment

simply because of a pleading defect. Roark, 813 S.W.2d at 495.

      Here, Appellants objected in their response to Appellees’ motion for

summary judgment that Appellees had failed to plead the “one satisfaction rule”

defense in their answer, but they did not object that Appellees had failed to

plead the affirmative defense of limitations. Appellants also argued in their

response that Appellees did not “prove all elements of its [limitations]

affirmative defense,” but this contention challenges the trial court’s ruling on

the merits of the defense, not on the absence of the rule 94 pleading.

Accordingly, because Appellants did not notify the trial court in a written

answer or response objecting that Appellees had failed to include the limitations

affirmative defense in their answer, Appellants’ objection may not be raised for

the first time on appeal. See Roark, 813 S.W.2d at 495; see also McConnell,
858 S.W.2d at 341; Red Roof Inns, Inc., 223 S.W.3d at 688. We overrule this

part of Appellants’ second issue.

                                       10
      B.     Limitations

      Appellees argued in the trial court that summary judgment was properly

granted on Appellants’ negligence action because it was not filed within the

applicable two-year limitations period. They contended that the negligence

action, which was filed in October 2006, accrued—at the latest—in June 2004

because at that time, Appellants had hired a professional engineer to assess

their foundation, received a report detailing the engineer’s opinion about the

foundation, notified Bollig by letter of the report, and requested that Bollig make

numerous repairs to the house.7

      The discovery rule defers accrual of a cause of action until the plaintiff

knows or, through the exercise of reasonable diligence, should know of facts

giving rise to the cause of action. Computer Assocs. Int’l, Inc. v. Altai, Inc.,

918 S.W.2d 453, 455 (Tex. 1996).            The discovery rule is “a very limited

exception to statutes of limitations” and applies only when the plaintiff’s injury

is both inherently undiscoverable and objectively verifiable. Id. at 455–56. An

injury is inherently undiscoverable if, by its nature, it is unlikely to be discovered

within the prescribed limitations period despite the exercise of due diligence.

Wagner & Brown, Ltd. v. Horwood, 58 S.W.3d 732, 734–35 (Tex. 2001). The

      7
      … Appellants do not dispute that their negligence action is governed by
a two-year statute of limitations.

                                         11
question is not whether the particular injury was actually discovered by the

claimant within the limitations period but whether “it was the type of injury that

generally is discoverable by the exercise of reasonable diligence.”         HECI

Exploration Co. v. Neel, 982 S.W.2d 881, 886 (Tex. 1998).

      A defendant who moves for summary judgment on the affirmative

defense of limitations has the burden to conclusively establish the defense,

which includes proving when the cause of action accrued and, if applicable,

negating the discovery rule by proving as a matter of law that there is no

genuine issue of material fact about when the plaintiff discovered or, in the

exercise of reasonable diligence, should have discovered the nature of its injury.

KPMG Peat Marwick v. Harrison County Hous. Fin. Corp., 988 S.W.2d 746,

748 (Tex. 1999); Dean v. Frank W. Neal & Assocs., Inc., 166 S.W.3d 352,

355–56 (Tex. App.—Fort Worth 2005, no pet.). If the movant establishes that

the statute of limitations bars the action, the nonmovant must then adduce

summary judgment proof raising a fact issue in avoidance of the statute of

limitations. KPMG Peat Marwick, 988 S.W.2d at 748.

      Appellees included in their summary judgment evidence a May 31, 2004

report produced by a professional engineer at Appellants’ request. The report

is addressed to Appellants and states, “This report constitutes the engineering

opinion that you requested on the foundation at the referenced address. It

                                       12
provides the professional opinion of the writer . . . .”     The engineer who

authored the report made the following “Exterior distress symptoms and

observations” of the home: (1) “stairstep crack in brick and mortar to 1/8

[inch] wide”; (2) “wood to brick separation greater than ½ [inch] wide”; (3)

“crack in perimeter beam to 1/8 [inch] wide”; (4) “trim pulled apart at joints”;

(5) “gap between trim and top brickline”; and (6) “horizontal crack in mortar to

1/16 [inch] wide.” The engineer made the following “Interior Observations”:

(1) “Door at position ‘A’ is slightly off level and low towards the low

elevations”; (2) “Small crack in plaster joint in wall”; (3) “Repaired cracks in

ceiling”; (4) “Window sill is off level”; (5) “Walls lean out”; and (6) “Trim

buckle.”

      Also included in Appellees’ summary judgment evidence is a June 11,

2004 letter drafted by Patrick Irwin and addressed to Bollig requesting that

Bollig take the following action:   (1) “Adjust piers if needed or foundation

repairs”; (2) “Repair cracks and re-plaster and paint repairs”; (3) “Re-work trim

where needed”; (4) “Align doors in the specified areas”; and (5) “Re-mortar

exterior cracks as well as wing at garage.”

      The summary judgment evidence demonstrates that the Appellants’

alleged negligently designed foundation was not inherently undiscoverable in

June 2004. The independent engineer’s report contained numerous details

                                       13
identifying problems related to Appellants’ foundation, and Appellants sent a

letter to Bollig asking it to make foundation-related repairs to the house. To the

extent the summary judgment evidence demonstrates that Appellants had not

already discovered the alleged negligently designed foundation, Appellants could

have discovered the alleged negligently designed foundation by exercising

reasonable diligence with the information contained in the independent

engineer’s report. Appellees thus met their burden to show that in June 2004,

Appellants knew or, through the exercise of reasonable diligence, should have

known of facts giving rise to their negligence action. See KPMG Peat Marwick,
988 S.W.2d at 748; see also Horwood, 58 S.W.3d 732, 734–35.

        Appellants respond that a genuine issue of material fact exists as to

whether their negligence action accrued in June 2004 because (1) they were

not aware of any “major structural issues” when the June 2004 letter was

drafted; (2) Bollig indicated that the matters were “cosmetic settling issues”;

(3) the independent engineer stated that they should “let everything settle and

then complete repairs in August [2004]”; and (4) the letter was “just to tell Mr.

Bollig of [their] plan to wait until August, and then [Bollig] should complete

these    repairs.”   But   Appellants’    evidence   regarding   their   subjective

interpretation of the independent engineer’s report is only relevant to whether

they knew of facts giving rise to their negligence action.         In light of the

                                         14
information contained in the engineer’s report identifying numerous foundation-

related issues with the home and of Patrick’s letter requesting repairs from

Bollig, Appellants’ evidence does not raise a genuine issue of material fact as

to whether, through the exercise of reasonable diligence, they should have

known in June 2004 about the facts giving rise to their negligence cause of

action. See Altai, Inc., 918 S.W.2d at 455–56.

      We hold that Appellants failed to raise a genuine issue of material fact

that the discovery rule tolled the accrual of the applicable two-year statute of

limitations beyond June 2004. Because Appellants did not file their negligence

cause of action until October 2006, months beyond the running of the two-year

limitations period in June 2006, we hold that the trial court did not err by

granting Appellees’ motion for summary judgment on Appellants’ negligence

action. We overrule the remainder of Appellants’ second issue.

      Because we have overruled Appellants’ first and second issues, we need

not consider their third issue, complaining that the trial court erred by granting

Appellees’ motion for summary judgment under the “one satisfaction rule.” See

Tex. R. App. P. 47.1.

                      VI. R EMAINING “C AUSES OF A CTION”

      In their fourth issue, Appellants argue that the trial court erred by granting

a final summary judgment because Appellees did not challenge all alleged

                                        15
“causes of action.”     They contend that Appellees never challenged their

“actions”   for agency/joint enterprise, unconscionable/knowing         conduct,

damages, attorneys’ fees, litigation expenses, and mental anguish. According

to Appellants’ third amended petition, the only “causes of action” asserted

against Appellees include negligence and breach of warranties.8         We have

already held above that the trial court did not err by granting Appellees’ motion

for summary judgment on Appellants’ implied breach of warranty and

negligence actions. We overrule Appellants’ fourth issue.

      8
        … Agency and joint enterprise are theories of vicarious liability, see St.
Joseph Hosp. v. Wolff, 94 S.W.3d 513, 517 (Tex. 2002) and Crooks v. Moses,
138 S.W.3d 629, 637–38 (Tex. App.—Dallas 2004, no pet.); unconscionable
or knowing conduct refers to conduct relevant to a claim for violation of the
Deceptive Trade Practices Act, see Tex. Bus. & Com. Code Ann. § 17.50(a)(3),
(b)(1) (Vernon Supp. 2008); generally, attorneys’ fees or litigation expenses are
not recoverable unless allowed by statute or contract, see McDorman v.
Rogers, No. 09-06-00514-CV, 2008 WL 1970928, at *11 (Tex.
App.—Beaumont May 8, 2008, no pet.) (mem. op.); and even if there was a
fact issue as to when Appellants’ negligence claim accrued, which there is not,
damages for mental anguish are not recoverable in this case, see Glenn, 2008
WL 2078510, at *4 (“Because Glenn’s pleaded negligence cause of action was
for only professional engineering negligence that purportedly caused property
damage to her home, she is, as a matter of law, not entitled to mental anguish
damages . . . .”).

                                       16
                              VII. C ONCLUSION

     Having overruled Appellants’ first, second, and fourth dispositive issues,

we affirm the trial court’s order granting summary judgment in favor of

Appellees.

                                                 BILL MEIER
                                                 JUSTICE

PANEL: CAYCE, C.J.; DAUPHINOT and MEIER, JJ.

DELIVERED: August 13, 2009

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