656 S.W.3d 577
Tex. App.2022Background:
- Rise Above, a steel erector, subcontracted with Marquez to perform work on the Atlas Project; Marquez allegedly withheld payment.
- Rise Above sued Marquez and Atlas Sand and recorded a mechanic’s/materialman’s lien; Atlas Sand and Liberty Mutual (surety) posted a bond to indemnify the lien.
- Rise Above amended its petition to drop Atlas Sand and assert a lien-bond claim against Liberty Mutual while maintaining breach of contract and quantum meruit claims against Marquez.
- Liberty Mutual filed a hybrid traditional and no-evidence summary-judgment motion focused on pass-through/privity and lack of evidence of services to the owner; it did not challenge the lien-bond claim’s validity in the trial court.
- The trial court granted summary judgment without stating grounds. The court of appeals reversed, finding the traditional motion relied on an inapplicable pass-through theory and the no-evidence motion improperly targeted elements not required of Rise Above’s bond/lien claim.
- The record contained Rise Above evidence (owner declaration, invoices, daily reports) showing work and extra work on the Atlas Project; Liberty Mutual failed to timely challenge lien perfection or the affidavit and thus waived those arguments on appeal.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicability of Interstate Contracting (pass-through/privity) | Interstate Contracting does not apply; Rise Above did not assert a pass-through claim | Liberty Mutual: lack of privity bars recovery; Marquez (GC) not part of suit so pass-through claim invalid | Court: Liberty Mutual relied on a non-existent pass-through theory; traditional SJ under Rule 166a(c) was improper; reversed |
| Whether Rise Above had to prove breach of contract with owner at summary stage | No; claim against Liberty Mutual is on the indemnity bond under Chapter 53, so privity with owner is not required at summary judgment | Liberty Mutual: absence of a contract with Atlas Sand means no recoverable claim (invoking Property Code) | Court: Rise Above had no burden to prove breach of contract with Atlas Sand at summary judgment; no-evidence SJ on that basis was erroneous |
| Quantum meruit — whether Rise Above presented evidence of valuable services to owner | Rise Above produced declaration, invoices, reports showing work and extra work on Atlas Project | Liberty Mutual: services benefited Marquez, not Atlas Sand; insufficient evidence owner accepted/was notified | Court: Evidence was more than a scintilla that services benefitted the owner; no-evidence SJ improper |
| Can defendant raise defective lien/affidavit for first time on appeal? | Rise Above: Liberty Mutual waived any attack by not raising it in summary-judgment motion or properly denying conditions precedent in its answer | Liberty Mutual (on appeal): lien affidavit is fatally defective under Property Code | Court: Defendant may not raise the lien-validity/affidavit defect for the first time on appeal; issue waived |
Key Cases Cited
- Interstate Contracting Corp. v. City of Dallas, 135 S.W.3d 605 (Tex. 2004) (discusses pass-through liability vs. statutory lien/payment-bond remedies)
- Herrera v. Resignato, 621 S.W.3d 835 (Tex.App.—El Paso 2021) (standard of review for summary judgment)
- Villarreal v. Wells Fargo Brokerage Servs., LLC, 315 S.W.3d 109 (Tex.App.—Houston [1st Dist.] 2010) (no-evidence summary judgment cannot attack an element not required of the claim)
- Wade & Sons, Inc. v. American Standard, Inc., 127 S.W.3d 814 (Tex.App.—San Antonio 2003) (pleading/perfection of lien and requirement to specifically deny conditions precedent)
- King Ranch v. Chapman, 118 S.W.3d 742 (Tex. 2003) (more-than-a-scintilla standard for summary-judgment evidentiary challenges)