Opinion
No. 05-08-01439-CV
Opinion Filed July 30, 2010.
On Appeal from the 134th District Court, Dallas County, Texas, Trial Court Cause No. 05-00018-G.
Before Justices MOSELEY, O'NEILL, and FRANCIS.
MEMORANDUM OPINION
Appellants Thomas M. Scheler and Denise C. Scheler (Homeowners) appeal a summary judgment granted in favor of Larry Smith, P.E. individually and d/b/a Larry Smith Engineering. The primary issue raised in this appeal is whether the trial court erred in concluding Texas law does not recognize an implied warranty claim by a homeowner against a subcontractor. For the following reasons, we affirm the trial court's judgment.
After Homeowners purchased their home from the builder of the home, they discovered the foundation upon which it was built was defective. The Schelers sued the builder and Smith, the structural engineer that designed, but did not build, the foundation. Homeowners alleged claims against the builder for negligence, breach of contract, breach of warranty, DTPA violations, and fraud. They alleged claims against Smith for negligence and breach of warranty. Pursuant to an arbitration agreement in the contract between Homeowners and the builder, Homeowners arbitrated their claims against the builder. The trial court abated the proceedings pending arbitration.
Following the arbitration, the arbitrator entered an award in favor of Homeowners. Smith was not a party to those proceedings. The trial court subsequently reinstated the proceedings and granted Homeowners' motion to sever and severed out Homeowners' claims against the builder from the instant claims against Smith. The builder then filed for bankruptcy. Homeowners made a claim against the builder's insurance carrier and settled for "thousands of dollars" less than the arbitration award.
In the instant case, Smith filed a motion for summary judgment asserting Homeowners could not prevail as a matter of law against him on their claim for breach of an implied warranty because Texas law does not recognize such a claim by a homeowner against a subcontractor with whom he has no privity. He also asserted Homeowners' negligence claims fail as a matter of law because he had no duty to Homeowners, he did not breach any duty, and he did not proximately cause any damages to Homeowners. Smith also moved for summary judgment on both claims based on collateral and judicial estoppel. Although the trial court initially denied Smith's motion for summary judgment, it subsequently granted his motion to reconsider and rendered judgment that Homeowners take nothing on their claims. The summary judgment order does not state the grounds for granting summary judgment.
The standard for reviewing a traditional summary judgment is well established. See Tex. R. Civ. P. 166a(c); Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548-49 (Tex. 1985). Defendants who move for summary judgment must show the plaintiffs have no cause of action. Carter v. People Answer, Inc., 312 S.W.3d 308, 311 (Tex. App.-Dallas 2010, no pet.). When multiple grounds for summary judgment are raised and the trial court does not specify the ground or grounds relied upon for its ruling, the appellate court will affirm the summary judgment if any of the grounds advanced in the motion are meritorious. Carr v. Brasher, 776 S.W.2d 567, 569 (Tex. 1989); Red Roof Inns, Inc. v. Murat Holdings, L.L.C., 223 S.W.3d 676, 684 (Tex. App.-Dallas 2007, pet. denied). If an appellant does not challenge each possible ground on which summary judgment could have been granted, we must uphold the summary judgment on the unchallenged ground. Malooly Bros., Inc. v. Napier, 461 S.W.2d 119, 121 (Tex. 1970); Carter, 325 S.W.3d at 311; Jarvis v. Rocanville Corp., 298 S.W.3d 305, 313 (Tex. App.-Dallas 2009, pet. denied).
Homeowners do not complain of the trial court's granting summary judgment on their negligence claim and we therefore do not reach that issue. Instead, Homeowners contend the trial court erred in granting summary judgment on their breach of implied warranty claim because public policy requires such a claim to be recognized under the facts of this case. Smith moved for summary judgment on both the negligence and implied warranty claims based on the affirmative defenses of collateral estoppel and judicial estoppel. In their appellate brief, Homeowners list as an "issue" a complaint that the trial court erred in granting summary judgment based on "collateral estoppel," but they do not then include any substantive argument in their brief regarding either the collateral estoppel or judicial estoppel defenses. Specifically, they have provided this Court with no argument, authority, or citations to the record to show summary judgment was improper on these grounds. See Tex. R. App. P. 38.1(h) (appellant's brief must contain a clear and concise argument for the contentions made, with appropriate citations to authorities and to the record); see also Amir-Sharif v. Mason, 243 S.W.3d 854, 856 (Tex. App.-Dallas 2008, no pet.). Homeowners have not properly attacked the summary judgment based on Smith's defenses. Because summary judgment may have been granted, properly or improperly, on a ground not challenged by appellants, we must affirm the summary judgment. See Holloway v. Starnes, 840 S.W.2d 14, 23 (Tex. App.-Dallas 1992, writ denied).
Even if we could conclude the trial court erred in granting summary judgment on the defensive issues, we cannot conclude the trial court erred in granting summary judgment on Homeowners' claim for breach of implied warranty. An implied warranty will arise by operation of law when public policy mandates. Melody Home Mfg. Co. v. Barnes, 741 S.W.2d 349, 353 (Tex. 1987). There must be a compelling need to justify an implied warranty for service transactions. Cessna Aircraft Co. v. Aircraft Network, L.L.C., 213 S.W.3d 455, 467 (Tex. App.-Dallas 2006, pet. denied) ( citing Rocky Mtn. Helicopters, Inc. v. Lubbock Cnty. Hosp. Dist., 987 S.W.2d 50, 53 (Tex. 1998)). A compelling need for an implied warranty does not exist where other adequate remedies are available. Rocky Mtn., 987 S.W.2d at 53. Where a party has negligence and/or breach of contract claims available, an implied warranty does not arise. Cessna Aircraft Co., 213 S.W.3d at 467; see also Codner v. Arellano, 40 S.W.3d 666, 672-75 (Tex. App.-Austin 2001, no pet.).
The courts directly presented with the question of whether an implied warranty exists with respect to a subcontractor have held no such warranty exists because the homeowner has a remedy against the general contractor. See Pugh v. Gen. Terrazzo Supplies, Inc., 243 S.W.3d 84, 89-90 (Tex. App.-Houston [1st Dist.] 2007, pet. denied); J.M. Krupar Const. Co., Inc. v. Rosenberg, 95 S.W.3d 322, 332 (Tex. App.-Houston [1st Dist.] 2002, no pet.); Codner, 40 S.W.3d at 672-75 (Tex. App.-Austin 2001, no pet.); see also Rayon v. Energy Specialties, Inc., 121 S.W.3d 7, 21 (Tex. App.-Fort Worth 2002, no pet.). The Fort Worth court of appeals has specifically held under nearly identical facts that a homeowner may not recover from a foundation engineer with whom he has no direct contractual relationship. Glenn v. Nortex Found. Designs, Inc., 2008 WL 2078510 *3 (Tex. App.-Fort Worth May 15, 2008, no pet.). We agree.
Here, Homeowners had a remedy against the builder of their home for defects in the home's foundation. They pursued that remedy in arbitration, obtained an award against the builder, and settled with the builder's insurance company. They however claim that their "remedy" was not adequate because they were not fully compensated by the arbitration award and because the builder has filed for bankruptcy. According to Homeowners, an "adequate" remedy is only available if the plaintiff has not only obtained a judgment against the builder compensating them for all of their alleged damages, but also if that judgment is collectable. We disagree.
We conclude the issue of whether a particular homeowner is ultimately fully compensated is not relevant in determining whether an adequate remedy exists in the first instance. Otherwise, whether or not an "implied warranty" exists against a subcontractor could not be determined at the time of the alleged breach, or even when the subcontractor negotiated and entered into its contract. Indeed, according to Homeowners' rationale, whether an implied warranty exists could only be determined after first determining both (1) that a judgment against the builder fully compensated the homeowner, and (2) that the judgment could be fully collected. This cannot be the law. Rather, the issue of whether a remedy is available is determined by whether Texas law recognizes a cause of action for the particular loss suffered, not whether a particular plaintiff is actually fully compensated by a particular defendant. See Rocky Mtn., 987 S.W.2d at 53 (discussing adequate remedy in terms of availability rather than actual success).
Finally, Homeowners rely on public policy considerations outlined in Jacob E. Decker Sons v. Capps, 164 S.W.2d 828, 829 (1942) to support creation of a warranty under the facts of this case. Jacob E. Decker was a food contamination case in which the plaintiff family consumed contaminated food causing the death of one child and other family members to become seriously ill. A review of Decker quickly reveals that the basis for the implied warranty created in that case was the broad principle of public policy "to protect human health and life." Id. at 829. We conclude Jacob E. Decker Sons does not support implying a warranty in this case where the only damages suffered were to appellant's home. We conclude appellants have failed to show the trial court erred in granting Smith's motion for summary judgment. We affirm the trial court's judgment.