Lalonde v. Gosnell

Decision Date14 June 2019
Docket NumberNo. 16-0966,16-0966
Citation593 S.W.3d 212
Parties Thomas A. LALONDE, Jr., P.E., Individually and d/b/a Lee Engineering Co., Lee Engineering Co., Stanley Harold Prather and Prather Engineering Consultants, Inc., Petitioners, v. Paul GOSNELL and Kim Gosnell, Respondents
CourtTexas Supreme Court

Amy Fitzgerald Casto, Texas Council of Engineering Companies, 1001 Congress, Suite 200, Austin TX 78701, for Amicus Curiae American Council of Engineering Companies of Texas.

Diana L. Faust, Kyle M. Burke, R. Brent Cooper, Cooper & Scully, P.C., Founders Square, 900 Jackson Street, Suite 100, Dallas, TX 75202, for Amicus Curiae Texas Alliance for Patient Access.

Frank Gilstrap, Frank W. Hill, Garrett T. Reece, Hill Gilstrap, P.C., 1400 West Abram Street, Arlington, TX 76013-1705, Andrew F. Stasio Jr., Stasio & Stasio, P.C., 303 Main Street, Ste. 302, Fort Worth, TX 76102-4069, for Petitioners.

Jeffrey L. Crouch, Haiman Hogue, PLLC, Hall Office Park, 2595 Dallas Parkway, Suite 100, Frisco TX 75034, for Respondent.

Justice Guzman delivered the opinion of the Court, in which Justice Green, Justice Lehrmann, Justice Devine, Justice Brown, and Justice Busby joined.

Eva M. Guzman, Justice

Chapter 150 of the Texas Civil Practice and Remedies Code requires that a sworn "certificate of merit" accompany any lawsuit complaining about a licensed professional engineer's services.1 Failure to contemporaneously file an affidavit from a similarly licensed professional attesting to the lawsuit's merits requires dismissal of the suit.2 The certificate-of-merit requirement is a substantive hurdle that helps ensure frivolous claims are expeditiously discharged.3 To that end, if the plaintiff fails to file a certificate of merit, the statute obviates the need to litigate the lawsuit altogether, even to the point of relieving the defendant of any obligation to file an answer until thirty days after a certificate is filed.4

No certificate of merit has ever been filed in this lawsuit, as required, but the defendant engineers did not seek dismissal until the eve of trial—1,219 days after suit was filed, nearly two years after the engineers answered, and long after the limitations periods had expired on the plaintiffs' claims. In the interim, the engineers participated in discovery until all discovery deadlines had expired, filed motions seeking to shift responsibility to third parties, and—rather than invoking the absolute statutory right to dismissal—chose to participate in alternative methods for terminating the lawsuit. As we affirmed in Crosstex Energy Services, L.P. v. Pro Plus, Inc. , a defendant can waive Chapter 150's certificate-of-merit requirement by litigating inconsistently with claiming the right to dismissal.5 Considering the totality of the circumstances, we agree with the court of appeals that the defendant engineers' engagement of the judicial process implies they intended to waive the statute's requirements.6 Accordingly, we affirm the court of appeals' judgment and remand the case to the trial court for further proceedings.

I. Background

Paul and Kim Gosnell hired Thomas A. LaLonde d/b/a Lee Engineering Co.; TAL Industries, Inc. d/b/a Lee Engineering Co.; Stanley Harold Prather; and Prather Engineering Consultants Inc. (collectively, the Engineers) to evaluate and stabilize their home's foundation. The Gosnells allege the Engineers' work exacerbated the foundation problems, causing significant damage to their home. Exactly two years later, the Gosnells sued the Engineers, alleging contract and tort claims, but they did not contemporaneously file a certificate of merit as required by section 150.002 of the Texas Civil Practice and Remedies Code.

Twenty months later, the Engineers filed their original answer, denying the allegations and requesting attorney's fees. Though a certificate of merit still had not been filed, the parties agreed to a scheduling order establishing discovery and expert-designation deadlines and setting a trial date. Shortly thereafter, the parties voluntarily participated in mediation to resolve the case without further litigation.

When settlement efforts failed, the parties began litigating the case in accordance with the scheduling order. Over the course of the next eighteen months, the Engineers successfully moved to withdraw and substitute counsel; supplemented their answer with specific denials and affirmative defenses; propounded and responded to discovery requests; designated expert witnesses; and moved to designate responsible third parties under Chapter 33 of the Texas Civil Practice and Remedies Code. A second agreed scheduling order extended the discovery and expert-witness designation deadlines and also reset the trial, which had been continued by agreement at the defendants' request. The day discovery closed, the Engineers produced a final batch of documents. A few days after that, the parties participated in an unsuccessful court-ordered mediation.

Two days later—and mere weeks before trial—the Engineers filed a motion to dismiss with prejudice because the Gosnells had not included a certificate of merit when they filed their original petition forty months earlier. The dismissal hearing was delayed for an additional five months as the parties engaged in further settlement negotiations, but the trial court ultimately granted the motion and dismissed the Gosnells' lawsuit with prejudice.

The court of appeals reversed, holding the Engineers impliedly waived section 150.002's requirements.7 Considering the totality of the circumstances, the court concluded that "the Engineers' engagement in the judicial process indicated their intention to litigate and amounted to waiver."8

We granted the Engineers' petition for review, which asserts the court of appeals applied the wrong waiver standard and the wrong standard of review. The Engineers argue that implied waiver of a statutory right (1) is not determined under a totality-of-the-circumstances test, (2) should not be reviewed de novo because it involves a question of intent, (3) always begins with a presumption against waiver, and (4) requires a showing of prejudice. We reject the first two arguments. As to the third, we hold that the undisputed evidence satisfies the burden of proof under our intent-based waiver standard.9 We need not decide whether prejudice—a conceptually distinct concept from waiver—is required to effect a waiver because prejudice is established on this record.

II. Discussion

In Crosstex Energy Services, L.P. v. Pro Plus, Inc. , we held that section 150.002's certificate-of-merit requirement is mandatory but not jurisdictional, so notwithstanding the absence of a statutory deadline for dismissal, it can be waived.10 The Gosnells concede they failed to file the affidavit section 150.002 requires, but assert the Engineers impliedly waived that requirement by substantially invoking the judicial process contrary to their statutory right to dismissal. The court of appeals agreed with the Gosnells but the Engineers say this was error because the court applied the "totality of the circumstances" waiver test instead of the "traditional" waiver test. Perceiving a distinction between judicial articulations of the waiver standard, the Engineers maintain that the "totality of the circumstances" test is limited to determining waiver of contractual rights, such as arbitration and forum selection, while the "traditional" test applies to waiver of statutory rights, like those in section 150.002.

We disagree that the waiver tests are different in the way the Engineers assert. The nature of the right at issue might make a difference in whether a showing of prejudice or detriment is required,11 a matter we need not consider in this case, but we cannot agree that the standard for determining implied waiver differs.

A. Waiver Standard

Waiver is the "intentional relinquishment of a known right or intentional conduct inconsistent with claiming that right."12 Waiver "results as a legal consequence from some act or conduct of the party against whom it operates" and is "essentially unilateral in character," meaning "no act of the party in whose favor it is made is necessary to complete it."13 Prejudice, in comparison, is an estoppel-based requirement that focuses on detriment or prejudice to the other party.14

Though waiver is a question of intent, it need not be explicit.15 A party's conduct sufficiently demonstrates intent to waive a right if, in light of the "surrounding facts and circumstances," it is "unequivocally inconsistent with claiming" that right.16 As we explained in Crosstex , "[s]ubstantial invocation of the judicial process" implies waiver when it "clearly demonstrat[es]" an intent to abandon a known right.17 Intentional relinquishment is "clearly demonstrate[d]" when litigation conduct is manifestly inconsistent with the right at issue.18 To effect waiver by litigation conduct in the arbitration and forum-selection cases, we have also required a showing of prejudice but only in addition to an intent to abandon those rights.19 Under Texas law, implied waiver and prejudice are distinct concepts.20 That does not mean, however, that evidence bearing on one is irrelevant to the other, because conduct inconsistent with claiming a right can evince intent while also working a prejudice to the opposing party.

Our description of the type of litigation conduct that can establish an implied waiver has varied in articulation, but not in substance. While our arbitration and forum-selection cases refer to implied waiver arising when a party "substantially invokes the litigation process,"21 some statutory-right cases refer to waiver implied by "engagement in the judicial process" that "clearly demonstrates" an intent to waive the right.22 To the extent these linguistic variations have caused confusion, we clarify here that the universal test for implied waiver by litigation conduct is whether the party's conduct—action or...

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