Texas Supreme Court takes away $190,000 judgment against foundation repair company because homeowner waited too long to file lawsuit

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by Charles Miller

Nelda Gonzales hired a plumber to repair water leaks under her foundation and hired Olshan Foundation Repair Co. (Olshan) to repair the foundation problems the water leaks had caused. The foundation repair contract included a lifetime, transferrable warranty on the work requiring Olshan to adjust the foundation due to settling. The contract further provided that Olshan was to “perform all the necessary work in connection with this job … in a good and workmanlike manner.”

In April 2002, Gonzales noticed doors not locking, windows not opening, and new cracks appearing in previously repaired walls. Gonzales informed Olshan and her property insurer, who both informed her there were additional plumbing leaks. Olshan excavated tunnels under the home to allow a plumbing company to repair those leaks in May 2003. Olshan leveled the foundation in August 2003.

Olshan again leveled the foundation in October 2003. During this work, an Olshan employee informed Gonzales that Olshan was “not doing a good job under the home…. In fact, it’s the worst job I have ever seen.”

Gonzales alleges that an Oshan foreman informed her they had spent too much time on her home and, in light of their other work, would place her on a wait list for four to six months. Olshan left the property, and Gonzales believed Olshan would return in four to six months to correct the work.

On November 12, 2003, Olshan sent an engineer to take elevations and a plumber to check for plumbing leaks. The engineer told Gonzales the foundation was functioning properly, and Gonzales believed she was still on a wait list for further work. In early 2004, Olshan returned to fill in the tunnels under Gonzales’s home in response to a call by Gonzales’s husband. Gonzales again refused to allow Olshan to fill in the tunnels because it had not repaired the foundation.

Gonzales subsequently called Olshan, who sent an engineering firm to inspect the home in July 2005. The engineer reported that the foundation was functioning properly. On July 11, 2005, Olshan’s general counsel notified Gonzales that, “[b]ased on th[e] [engineer’s] report, no adjustments to the … underpinning system are required at this time,” and Olshan needed to fill in the tunnels if no further plumbing leaks were detected.

In May 2006, Gonzales noticed more cracking. She hired an engineer to inspect her home, and he determined Olshan improperly repaired the foundation by: (1) not epoxying the cable holding the string of piles together, and (2) failing to drive the piles more than 15 feet deep.

In June 2006, Gonzales sued Olshan for, among other things, breach of an express warranty, breach of the common-law warranty of good and workmanlike repairs, and DTPA violations. The jury failed to find that Olshan breached its express warranty, but it found that Olshan did breach the implied warranty of good and workmanlike repairs and engaged in unconscionable actions under the DTPA, causing $101,000 in damages to Gonzales’s home. The trial court entered judgment in favor of Gonzales for $101,000, as well as $10,127 in engineering fees and $80,000 in attorney’s fees under the DTPA.

The Supreme Court has now reversed the jury verdict and rendered judgment that Gonzales take nothing. Gonzales v. Southwest Olshan Foundation Repair Co., LLC, No. 11–0311 (Tex. March 29, 2013). The Supreme Court agreed with the court of appeals that the implied warranty of good and workmanlike repairs is actionable only under the DTPA, not under the common law, and is therefore governed by the DTPA’s two-year statute of limitations. According to the Supreme Court, Gonzales should have discovered Olshan’s wrongful acts no later than in October 2003, when she alleged an Olshan employee told her the work was “the worst job [he had] ever seen.”

The Supreme Court also held that there was no implied warranty to perform the work in a good and workmanlike manner because the parties’ agreement superseded any such implied warranty by expressly describing “the manner, performance or quality” of the services to be provided. Id. “In other words, the implied warranty of good and workmanlike repair of tangible goods or property attaches to a contract if the parties’ agreement does not provide for the quality of the services to be rendered or how such services are to be performed.” Id.

Here, the parties’ agreement includes two warranty provisions. First, the warranty certificate provides that Olshan would use the Cable Lock system of foundation repair and would adjust the foundation for the life of the home due to settling. Second, the contract provides that Olshan “will perform all the necessary work in connection with this job … in a good and workmanlike manner.” […]This warranty language specified the work Olshan was to provide (foundation repair with the Cable Lock system), the manner in which it was to provide it (a good and workmanlike manner), and how the service would perform (that it would not need adjustments for life due to settling, or, if it did, would be adjusted without cost to the owner). Thus, this warranty language “sufficiently describes the manner, performance or quality” of how Olshan and the foundation are to perform so as to supersede the implied warranty of good and workmanlike repair or modification to tangible goods or property.

Id. Because the jury found that Olshan did not breach the express warranty and the claim under the DTPA for breach of an implied warranty was barred by limitations, the Supreme Court affirmed the ruling by the court of appeals that Gonzales should take nothing.

Wait Too Long and You Lose Your Right to Bring A Claim

Gonzales filed her DTPA lawsuit only a few months too late. However, even one day too late is enough to completely bar a legal claim. It is important to understand that all property damage, personal injury and wrongful death claims must be brought within a certain period of time, called the “statute of limitations.” Claims not brought within such time are barred as a matter of law. Figuring out the statute of limitations for a particular claim can be extremely difficult. Different states have different statutory time periods.

Some states recognize the “discovery rule” which allows a plaintiff to bring their claims within a certain time of learning they have a claim rather than within a certain time of suffering their injury. The classic example of such a claim is a one based on a doctor leaving a sponge or other foreign body inside a patient after surgery; in most states, the time to bring a claim under these facts does not begin to run until the patient actually learns that some foreign body was left inside him, rather than from the date of the surgery.

In the context of a claim for wrongful death, most states apply their statute of limitations beginning on the date of death, regardless of whether the decedent’s family knew they had a claim at the time. Statutes of limitations for personal injury and wrongful death claims vary from one to six years, with two years being the most common among the various states.

Because of the complexity involved in determining the applicable statute of limitations, it is very important that victims contact a qualified attorney the moment they feel they may have a claim for personal injury or wrongful death. If they delay, they can lose their claim forever.

To successfully pursue a claim to recover for damages suffered as a result of the negligence of another, clients need an experienced, educated attorney on their side. They also need an attorney with the financial resources to take the case to trial. At Heygood, Orr & Pearson, we have tried literally hundreds of cases to verdict and have settled hundreds more. In 2010 alone, we negotiated settlements of personal injury and wrongful death claims totaling more than $50 million. Heygood, Orr & Pearson also has the financial resources to handle personal injury cases from beginning to end. In fact, there are many instances when we have invested hundreds of thousands of dollars in a case in order to take it to trial. At Heygood, Orr & Pearson, we are committed to achieving justice for our clients, whatever the cost.