Steven C. Albright and Rhonda Albright v. Rhea & Sons Enterprises, Inc. D/B/A Rhea Plumbing

Citation: Not availableDocket: 03-15-00496-CV

Court: Court of Appeals of Texas; November 8, 2015; Texas; State Appellate Court

Original Court Document: View Document

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Court of Appeals for the Third District of Texas, case number 03-15-00496-CV, involves appellants Dr. Steven Albright and Rhonda Albright against appellee Rhea Sons Enterprises, Inc., doing business as Rhea Plumbing. The case arises from allegations of negligence and breach of implied warranty due to plumbing defects and improper propane gas installation in the Albrights' newly purchased home from various general contractors. 

The general contractors designated Rhea Plumbing and other subcontractors as responsible third parties. After settling claims against the general contractors, the Albrights retained their claims against Rhea Plumbing. Subsequently, Rhea Plumbing filed a Traditional Motion for Summary Judgment, asserting defenses based on statute of limitations, estoppel by contract, and quasi-estoppel, claiming the Albrights' breach of implied warranty claims were also barred by precedent. The trial court ruled in favor of Rhea Plumbing, granting the motion and severing the case, which resulted in a final judgment.

The primary issue on appeal is whether the district court erred in granting Rhea Plumbing's motion for summary judgment. The Albrights initially filed suit against the general contractors on May 31, 2011, after discovering multiple construction defects and failing to obtain necessary repairs or information from the contractors.

On February 27, 2013, the General Contractor Defendants filed a Motion to Designate Responsible Third Parties, identifying 18 subcontractors, including Rhea Plumbing, who worked on the Appellants' residence. On April 10, 2013, the Appellants reached a settlement with the General Contractor Defendants, resolving all claims against them while retaining the right to pursue claims against the subcontractors, including Rhea Plumbing. The court entered an Order designating Rhea Plumbing as a Responsible Third Party on April 11, 2013. 

Following the settlement, a Take Nothing Judgment was issued against the General Contractor Defendants, with claims against Rhea Plumbing remaining active. On April 29, 2013, the Appellants filed a 3rd Amended Petition, adding Rhea Plumbing as a defendant for negligence and breach of implied warranty related to plumbing defects. Subsequently, on December 18, 2013, a Fourth Amended Petition was filed to address Rhea Plumbing's Special Exceptions.

On February 11, 2015, Rhea Plumbing filed Traditional and No Evidence Motions for Summary Judgment, arguing that the Appellants had settled their claims against them through the earlier settlement with the General Contractor Defendants, that claims were barred by limitations, and that there was no evidence supporting the breach of contract claim. Appellants contended that their claims against Rhea Plumbing were not settled and argued against the applicability of the limitations defense, citing Tex. Civ. Prac. Rem. Code 33.004(e), which waives limitations for parties joined within 60 days of designation as responsible third parties.

Appellants assert that their breach of implied warranty claims are not barred by precedent and clarify that they are not pursuing a breach of contract claim against Rhea Plumbing due to the absence of a contract, rendering the defendant’s no-evidence motion for summary judgment moot. The trial court granted Rhea Plumbing's summary judgment on May 20, 2015, citing the need for a valid contract to support the affirmative defenses raised. Both parties acknowledge there is no contract, and even if one existed, Rhea Plumbing failed to demonstrate essential elements of its defenses, including that Appellants denied or contradicted the nonexistent contract's terms. Additionally, the district court ruled that the Appellant’s claims were barred by limitations, contradicting statutory allowances for claims against Rhea Plumbing. Appellants request that the appellate court reverse the summary judgment and remand the case for a new trial, arguing that Rhea Plumbing did not meet its burden to prove the absence of a genuine issue of material fact. They emphasize that the estoppel by contract doctrine is inapplicable because there is no existing contract between the parties, and previous case law supports that estoppel can only be claimed by parties to a contract. Rhea Plumbing's cited cases all involved parties to a contract, further underscoring the inapplicability of their estoppel argument in this context.

Rhea Plumbing cannot invoke the April 10, 2013 settlement agreement between the Appellants and the General Contractor Defendants since it is not a signatory to the agreement. Legal precedent establishes that only signatories can assert the estoppel by contract defense, and the settlement explicitly addresses disputes solely between the signatories, allowing the Appellants to settle claims against the General Contractor Defendants while preserving their claims against Rhea Plumbing. 

Additionally, Rhea Plumbing lacks contractual privity, which prevents it from employing the quasi-estoppel defense to argue that the Appellants have settled their claims against it. Quasi-estoppel requires mutual participation in a transaction, which Rhea Plumbing cannot demonstrate since it is a 'stranger' to the settlement agreement. The Appellants did not enter into any transaction that would benefit Rhea Plumbing and are allowed to pursue claims against it as per the settlement's terms. 

Moreover, even if a contract existed, the doctrines of estoppel by contract and equitable estoppel would not apply because the Appellants are not denying or contradicting the settlement terms. The Appellants confirmed that they settled claims against the General Contractor Defendants but did not agree to settle claims against Rhea Plumbing, which is not noted as a settling party in the agreement. The settlement explicitly retains the Appellants' rights to pursue claims against subcontractors, including Rhea Plumbing. Therefore, Rhea Plumbing's attempts to impose terms beyond those outlined in the settlement agreement are unfounded.

Rhea Plumbing's defense based on the statute of limitations is invalidated by Tex. Civ. Prac. Rem. Code 33.004(e), which allows for the joining of a responsible third party (RTP) within 60 days of their designation, regardless of limitations. Rhea Plumbing was designated as an RTP on April 11, 2013, and the Appellants joined them as a defendant on May 2, 2013, well within the stipulated timeframe. The court's interpretation of the statute focuses on the legislature's intent, which is clear and unambiguous in allowing such joinder. A precedent case, Flack v. Hanke, supports this interpretation, where the appellate court reversed a summary judgment based on limitations for a similarly designated RTP.

Additionally, Rhea Plumbing failed to demonstrate that the Appellants' breach of implied warranty claims were barred by precedent. The defendant cited two cases asserting that homeowners cannot maintain such claims against subcontractors; however, these cases were not applicable since they did not involve the assignment of claims from a general contractor to the Appellants. In this case, the settlement agreement permitted the Appellants to pursue all claims against subcontractors, thus potentially allowing them to assert claims they did not originally own.

The settlement agreement creates a factual issue regarding whether Appellants possess breach of implied warranty claims against Rhea Plumbing, which is distinct from Appellee’s arguments that only pertain to those claims. Rhea Plumbing's defense is not relevant to the Appellants' negligence claims. Even if Rhea Plumbing's stance on implied warranty claims is upheld, the Court would need to remand the negligence claims back to the trial court for further examination. Appellants request that the Court reverse the district court’s summary judgment in favor of Rhea Plumbing and remand for additional proceedings, including the taxation of costs against Rhea Plumbing and any other just relief. The document complies with typeface and word-count requirements, and a certificate of service confirms that the Appellant’s Brief was properly filed and served electronically. An appendix lists relevant orders and legal provisions.

The document includes a list of case law and statutory references primarily from Texas, showcasing various legal precedents and rules relevant to civil practice and remediations. Key cases cited include *City of Keller v. Wilson*, *Nixon v. Mr. Prop. Mgmt. Co.*, and *Valence Operating Co. v. Dorsett*, among others, which address issues related to liability, responsibility, and procedural requirements in civil cases. 

Statutory references include Texas Civil Practice and Remedies Code Section 33.004, detailing the criteria for designating an unknown person as a responsible third party (identified as “Jane Doe” or “John Doe”) until their identity is revealed. It stipulates that the defendant must provide identifying characteristics of the unknown individual in their answer, and outlines the process for moving to strike the designation if there is no evidence of the individual's responsibility for the claimant's injury post-discovery. 

The history of the statute reflects its enactment and subsequent amendments in 1995, 2003, and 2011, indicating an evolving framework for handling claims of responsibility in civil litigation. Annotations clarify the applicability of amendments and provide reference for further exploration of related legal principles, particularly those concerning proportionate responsibility, contribution, and indemnity.

A claimant may join a responsible third party within 60 days to avoid limitations. The changes introduced by Acts 2011, 82nd Leg., ch. 203, apply only to civil actions initiated after September 1, 2011; prior actions are governed by former law. In *Freeman v. American K-9 Detection Servs.*, the court found that a trial court erred in dismissing an injury claim against a private contractor for lack of sovereign immunity, as the contractor could not substantiate negligence by the Army or DOD. In *Williams v. Wells Fargo Bank*, insufficient facts were presented to designate a property management company as responsible for wrongful foreclosure. In *Parkhouse v. Johnson*, a motion to remand to state court was deemed proper due to the state-law claims and the non-core nature of the suit affecting bankruptcy jurisdiction. The designation of partners and officers as responsible third parties in *We mer v. KPMG LLP* did not make them parties to the suit under Texas Rules of Civil Procedure, which affected the removability of the class action claims. Lastly, in *Flack v. Hanke*, a professional corporation, although a settling party, was properly designated as a responsible third party within 60 days of trial, defeating a limitations claim against it.