Crosstex Energy Services, L.P. v. Pro Plus, Inc.Crosstex Energy Services, L.P. v. Pro Plus, Inc.
Bennett James Reaves, IV, Dale Jefferson, Levon G. Hovnatanian, Martin, Disiere, Jefferson & Wisdom, L.L.P., Houston, TX, for Respondent.
Randy L. Fairless, Johanson & Fairless, LLP, Sugar Land, TX, for Other interested party.1
This interlocutory appeal arises out of property damage that resulted from an explosion at a natural gas compression station. The station owner, Crosstex Energy Services, L.P., sued the lead construction contractor, Pro Plus, Inc. The parties then entered a Rule 11 agreement to move expert designation dates beyond the limitations period. After limitations ran, Pro Plus moved to dismiss because Crosstex had not filed a certificate of merit with its original petition as required by section 150.002 of the Texas Civil Practice and Remedies Code. See
I. Jurisdiction
This Court has limited jurisdiction over interlocutory appeals. See
II. Facts and Procedural Background
Crosstex provides natural gas gathering and transmission services. Crosstex uses compression stations to increase the pressure of gas from the field and discharge the gas through pipelines to downstream stations. Crosstex hired Pro Plus, a registered professional engineering firm, as the principal contractor to construct the Godley Compression Station. On November 15, 2008, a control valve gasket at the station failed. The resulting gas leak, once ignited, created a massive fire causing $10 million in property damage. Crosstex filed suit on April 14, 2010, asserting causes of action for general and specific negligence, negligent misrepresentation, breach of implied and express warranty, and breach of contract. Pro Plus‘s answer generally denied each allegation, raised affirmative defenses, and included requests for disclosure under
The trial court entered a docket control order setting the dates for the parties to designate experts pursuant to
Pro Plus appealed the interlocutory order. The court of appeals held: (1) it had jurisdiction to hear the interlocutory appeal; (2) the trial court abused its discretion by granting the extension without good cause; and (3) Pro Plus did not waive its right to dismissal. 388 S.W.3d 689, 698, 702, 706 (Tex.App.-Houston [1st Dist.] 2012, pet. granted). We granted Crosstex‘s petition for review. 56 Tex.Sup.Ct.J. 492 (Apr. 19, 2013).
III. Court of Appeals’ Interlocutory Appeal Jurisdiction
The certificate of merit statute applies to actions for damages arising out of “the provision of professional services by a licensed or registered professional,” such as Pro Plus. See
The threshold question is the court of appeals’ jurisdiction to hear this interlocutory appeal. As a general rule, appellate courts may consider appeals from in
This is a question of first impression. As Crosstex points out, however, the expert report requirements in the Medical Liability Act,
To summarize, both the certificate of merit statute and the Medical Liability Act allow interlocutory appeals of dismissals for failure to meet a threshold filing requirement. Only under the Medical Liability Act, however, has the Legislature expressly forbidden interlocutory appeals of extensions of time to meet the filing requirement. See
In Ogletree, the defendant timely objected to the sufficiency of an expert report and filed a motion to dismiss. 262 S.W.3d at 318. The trial court denied the motion to dismiss and granted a section 74.351(c) extension for the plaintiff to remedy the deficiency. Id. We held that when the
We clarified the scope of Ogletree in Badiga v. Lopez, 274 S.W.3d 681 (Tex.2009). In Badiga, where no report was served within 120 days of the original petition, we concluded that the Legislature‘s concerns for curing deficient reports were inapplicable. Id. at 684. Unlike Ogletree, the denial of the motion to dismiss and the grant of an extension were not inseparable; rather, the appeal of the trial court‘s ruling on the motion to dismiss did not have to address the ruling on extension. Id. at 684-85. The issue of timeliness addressed in Badiga differs from a report‘s sufficiency, addressed in Ogletree. See id. In Badiga, “[w]hether the trial court granted an extension or not, the issue [was] whether a case must be dismissed when no expert report [was] timely served.” Id.
Extending that logic to the certificate of merit context, we note that Crosstex is in a position similar to the plaintiff in Badiga. In each, failure to provide timely, mandatory documentation yields dismissal. Compare
The court of appeals in this case reviewed whether the trial court erred in denying Pro Plus‘s motion to dismiss for lack of a certificate of merit. Crosstex‘s failure to file a certificate left it without a statutory basis for extension.2 Thus, the court of appeals could evaluate the propriety of the trial court‘s ruling on the motion to dismiss without entanglement in the appeal of the granted extension. Cf. Badiga, 274 S.W.3d at 685. We hold that the court of appeals did not err in asserting jurisdiction over Pro Plus‘s motion to dismiss.
IV. “Good Cause” Extension for Filing a Certificate of Merit
We must now determine the contours of section 150.002(c)‘s “good cause” extension to the certificate of merit filing deadline and whether it applies to Crosstex‘s failure to file. We review statutory construction de novo. City of Rockwall v. Hughes, 246 S.W.3d 621, 625 (Tex.2008). If the statute is clear and unambiguous, we must read the language according to its common meaning “without resort to rules of construction or extrinsic aids.” State v. Shumake, 199 S.W.3d 279, 284 (Tex.2006). We rely on this plain meaning as an expression of legislative intent unless a different meaning is supplied or is apparent from the context, or the plain meaning
Subsection (c) states:
The contemporaneous filing requirement of Subsection (a) shall not apply to any case in which the period of limitation will expire within 10 days of the date of filing and, because of such time constraints, the plaintiff has alleged that an affidavit of a third-party licensed ... professional engineer ... could not be prepared. In such cases, the plaintiff shall have 30 days after the filing of the complaint to supplement the pleadings with the affidavit. The trial court may, on motion, after hearing and for good cause, extend such time as it shall determine justice requires.
Read in isolation, the final sentence of subsection (c) suggests the availability of a good cause extension untethered from the remainder of the text. But that is not the way statutes are written or read. See TGS-NOPEC Geophysical Co. v. Combs, 340 S.W.3d 432, 441 (Tex.2011) (“It is a fundamental principle of statutory construction and indeed of language itself that words’ meanings cannot be determined in isolation but must be drawn from the context in which they are used.“). The first sentence of subsection (c) provides an exception to the contemporaneous filing requirement, made available when a plaintiff both files within ten days of the end of the limitations period and alleges that the late filing prevented the preparation of a certificate of merit. See
The untenable result of Crosstex‘s interpretation further solidifies this conclusion. Crosstex urges a broad exception, yet a narrow exception to the filing requirement aligns more closely with the scheme created by subsection (c). A plaintiff must allege that its near-limitations filing prevented the preparation of a certificate of merit. See
We hold that the “good cause” exception in subsection (c) does not stand alone, but rather is contingent upon a plaintiff: (1) filing within ten days of the expiration of the limitations period; and (2) alleging that such time constraints prevented the preparation of an affidavit. A plaintiff satisfying these requirements “shall” receive an extension of thirty days; upon motion, a trial court may, for good cause, extend this thirty-day period as justice requires. A plaintiff who files suit outside the ten-day window, as Crosstex did, cannot claim protection of the good cause exception.
V. Waiver
Crosstex next argues that Pro Plus waived its right to move for dismissal. This presents two questions: (1) can a defendant waive the right to obtain dismissal under section 150.002(e); and (2) if so, did Pro Plus waive this right? We address each question in turn.
A. Waiver of Right to Obtain Dismissal
We have defined waiver as “an intentional relinquishment of a known right or intentional conduct inconsistent with claiming that right.” Sun Exploration & Prod. Co. v. Benton, 728 S.W.2d 35, 37 (Tex.1987). Parties may not waive jurisdictional statutory duties. See Dubai Petrol. Co. v. Kazi, 12 S.W.3d 71, 76-77 (Tex.2000). But mandatory statutory duties are not necessarily jurisdictional. Helena Chem. Co. v. Wilkins, 47 S.W.3d 486, 494 (Tex.2001). A party may waive a mandatory, non-jurisdictional requirement by failing to object timely. Univ. of Tex. Sw. Med. Ctr. at Dallas v. Loutzenhiser, 140 S.W.3d 351, 359 (Tex.2004), superseded by statute,
Section 150.002(a) states that a plaintiff “shall” file the certificate of merit with its complaint.
Statutory interpretation principles guide our evaluation of whether section 150.002‘s certificate of merit requirement is jurisdictional. See White, 288 S.W.3d at 394. We must determine whether the Legislature intended a jurisdictional bar. See Loutzenhiser, 140 S.W.3d at 359 (“Since the Legislature is bound to know the consequences of making a requirement jurisdictional, one must ask, in trying to determine legislative intent, whether the Legislature intended those consequences.“). We may consider: (1) the plain meaning of the statute; (2) “the presence or absence of specific consequences for noncompliance“; (3) the purpose of the statute; and (4) “the consequences that result from each possible interpretation.” White, 288 S.W.3d at 395; Helena Chem., 47 S.W.3d at 495.
We address the first two factors together. The text of the statute itself does not indicate that failure to file a certificate of merit is jurisdictional. Granted, subsection (e) mandates dismissal as a remedy for non-compliance.
Because the Legislature did not declare the statute‘s purpose, the third factor provides little assistance. Yet the fourth factor—consideration of the implications of alternative interpretations—strongly suggests the requirement is non-jurisdictional. If we held the certificate of merit requirement jurisdictional, a plaintiff successfully pursuing a claim to final judgment, yet omitting a certificate of merit, would find the judgment always vulnerable to collateral attack. The defendant could have the judgment set aside at any time,
Returning to the medical liability arena, we find further support for this conclusion. In Jernigan v. Langley, 111 S.W.3d 153 (Tex.2003) (per curiam), this Court addressed whether a defendant waived the right to seek dismissal based on failure to file expert reports under the predecessor to section 74.351. Id. at 155. The statute effective at the time required a plaintiff to file an expert report within 180 days of filing a health care liability claim and permitted the defendant to move the court to dismiss with prejudice for failure to file an expert report. Act of May 5, 1995, 74th Leg., R.S., ch. 140, § 1, sec. 13.01(d), (e), 1995 Tex. Gen. Laws 985, 986, repealed by Act of June 2, 2003, 78th Leg., R. S., ch. 204, § 10.09, 2003 Tex. Gen. Laws 847, 884. While we did not engage in the jurisdictional analysis employed in this opinion, we did evaluate whether the defendant‘s conduct amounted to waiver. Jernigan, 111 S.W.3d at 156-58. As parties cannot waive jurisdictional requirements, Jernigan clearly implies that the expert report requirement is not jurisdictional. See id.3
Furthermore, every court of appeals that has squarely addressed an argument for waiver of section 150.002(e) dismissal has reached a result consistent with classifying the requirement as non-jurisdictional.4 One court of appeals explicitly recognized waiver, see Murphy, 374 S.W.3d at 635-36, and three other courts of appeals have addressed the waiver argument without the jurisdictional analysis, as we did in Jernigan. See Ustanik, 320 S.W.3d at 412-14 (reviewing claim of waiver under section 150.002 but determining the evidence was insufficient to support a waiver finding); Weaver, 305 S.W.3d at 411 (same); Landreth, 285 S.W.3d at 500-01 (same).
For the reasons stated, we hold that section 150.002 imposes a mandatory, but non-jurisdictional, filing requirement. Thus, we hold that a defendant may waive its right to seek dismissal under the statute.
B. Pro Plus‘s Conduct
Waiver is primarily a function of intent. Jernigan, 111 S.W.3d at 156. To find waiver through conduct, such intent “must be clearly demonstrated by the surrounding facts and circumstances.” Id.
1. Invocation of the Judicial Process
We have held that, in some circumstances, substantial invocation of the litigation process may amount to waiver. See Perry Homes v. Cull, 258 S.W.3d 580, 589-93 (Tex.2008) (applying a totality-of-the-circumstances test to conclude that homeowners substantially invoked the litigation process to the prejudice of the defendants and consequently waived arbitration). We must now determine whether Pro Plus‘s engagement in the judicial process amounts to implied waiver by “clearly demonstrat[ing]” its intent to waive the certificate of merit requirement. See Jernigan, 111 S.W.3d at 156.
The Texas Rules of Civil Procedure encourage liberal discovery practices. See Jordan v. Court of Appeals for Fourth Supreme Judicial Dist., 701 S.W.2d 644, 647 (Tex.1985). The discovery process streamlines the insatiable quest for information as the parties try to wrap their minds around the case. See State v. Lowry, 802 S.W.2d 669, 671 (Tex.1991) (stating that full discovery promotes fair resolution of disputes and noting that this Court “has vigorously sought to ensure that lawsuits are ‘decided by what the facts reveal, not by what facts are concealed‘” (quoting Jampole v. Touchy, 673 S.W.2d 569, 573 (Tex.1984, orig. proceeding))). Information may sustain a case, or it may lead to the end of litigation, but in either case it is the lifeblood of the process. See id. (“Discovery is thus the linchpin of the search for truth....“). Here, Crosstex claims it exchanged 11,000 pages of written discovery with Pro Plus pursuant to the docket control order, and that this evidences waiver. Quite simply, “[a]ttempting to learn more about the case in which one is a party does not demonstrate an intent to waive the right to move for dismissal.” Jernigan, 111 S.W.3d at 157. On these facts, Pro Plus‘s participation in discovery provides negligible support to the waiver argument.
Filing an answer is similarly inconsequential in the analysis. See, e.g., Palladian Bldg. Co. v. Nortex Found. Designs, Inc., 165 S.W.3d 430, 434-35 (Tex.App.-Fort Worth 2005, no pet.) (holding that it was not inconsistent or unreasonable for the defendant to answer before moving to dismiss). We should not penalize parties or their attorneys for acting out of an abundance of caution and protecting their interests by filing an answer.
Pro Plus joined a motion for continuance, engaged in discovery under a docket control order, and entered into a Rule 11 agreement. Crosstex construes this flurry of activity near the end of the limitations period as deliberate misrepresentation.
2. Failure to Object
Crosstex next argues that
VI. Extension by Agreement
Finally, we address Crosstex‘s argument that the Rule 11 agreement and the docket control order operated to extend the deadline for filing a certificate of merit. Pro Plus‘s answer included requests for disclosure under
In Spectrum Healthcare Res., Inc. v. McDaniel, 306 S.W.3d 249 (Tex.2010), this Court narrowly read the scope of a docket control order on the designation of experts. See id. at 250. McDaniel involved the interplay of an agreed order on deadlines for expert reports and the separate requirement in
VII. Conclusion
We hold that the court of appeals did not err in asserting jurisdiction over this interlocutory appeal. As to the merits of the appeal, we hold that: (1) Crosstex did not file suit within ten days of the running of limitations and thus cannot claim protection from the good cause extension in section 150.002(c); (2) a defendant may, through its conduct, waive the right to seek dismissal under section 150.002(e); and (3) Pro Plus‘s conduct did not consti
Notes
On the below entered date came on to be heard Defendant Pro Plus‘[s] Motion to Dismiss and Plaintiff Crosstex Energy Services, L.P.‘s Motion to Extend Time, and the Court, after reviewing the Motions, taking judicial notice of the other pleadings on file, and considering the argument of counsel, is of the opinion Defendant‘s Motion to Dismiss should be denied. For good cause shown, and in the interest of justice, the Court therefore:
ORDERS, ADJUDGES and DECREES that Plaintiff Crosstex Energy Services, L.P. file an expert report in compliance with the Certificate of Merit requirements contained in CPRC § 15[0].002 on or before the agreed deadline between the parties for Plaintiff to designate experts, currently April 8, 2011, which agreement was signed by the parties and thereafter filed with the court on November 29, 2010 pursuant to Rule 11 of the Texas Rules of Civil Procedure.