Nelda GONZALES, Petitioner, v. SOUTHWEST OLSHAN FOUNDATION REPAIR COMPANY, LLC, d/b/a/ Olshan Foundation Repair Company, Respondent.
No. 11-0311
Supreme Court of Texas
Delivered March 29, 2013
Rehearing Denied June 28, 2013
401 S.W.3d 52
Argued Oct. 15, 2012.
Jeffrey D. Janota, Stephan B. Rogers, for Respondent.
Justice GUZMAN delivered the opinion of the Court.
We decide whether the implied warranty for good and workmanlike repair of tangible goods or property in Melody Home Manufacturing Co. v. Barnes can be disclaimed or superseded.1 The Melody Home warranty is a “gap-filler” warranty similar to the one we addressed in Centex Homes v. Buecher for good and workmanlike construction of a new home.2 As in Buecher, we hold that parties cannot disclaim but can supersede the implied warranty for good and workmanlike repair of tangible goods or property if the parties’ agreement specifically describes the manner, performance, or quality of the services. Because the parties’ agreement here specifies that the service provider would perform foundation repair in a good and workmanlike manner and adjust the foundation for the life of the home due to settling, the express warranty sufficiently describes the manner, performance, or quality of the services so as to supersede the Melody Home implied warranty. We further hold that the plaintiff‘s remaining Deceptive Trade Practices Act claims are time barred because they were filed more than two-and-one-half years after one of the defendant‘s employees informed the plaintiff of the allegedly defective nature of the defendant‘s work. Thus, we affirm the court of appeals’ judgment that the plaintiff take nothing.3
Gonzales hired a plumber to repair water leaks under her foundation and hired Southwest Olshan Foundation Repair Co., LLC, d/b/a 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 “perform all the necessary work in connection with this job ... in a good and workmanlike manner.”4 The work included cosmetic repairs to the interior of the house, such as taping, floating, texturing, and painting walls and ceilings. 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 Gonzales that 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.
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.5 Gonzales again refused to allow Olshan to fill in the tunnels because it had not repaired the foundation.
Gonzales subsequently called Olshan, who sent BEC Engineering, LP (BEC) to inspect the home in July 2005. BEC reported that the foundation was functioning properly. On July 11, 2005, Olshan‘s general counsel notified Gonzales that, “[b]ased on th[e] [BEC] 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 engineer Jim Linehan 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.6 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.7 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.
II. Discussion
Olshan asserts that its express warranty superseded the implied warranty of good and workmanlike repair, and the jury‘s finding that Olshan did not breach the express warranty precludes liability on Gonzales‘s warranty claims.9 We agree.
Initially, we determine whether Olshan waived its argument that the express warranty supersedes the implied warranty. Gonzales contends that Olshan waived the issue by failing to raise it in the trial court. We disagree. In Rocky Mountain Helicopters, Inc. v. Lubbock County Hospital District, Rocky Mountain asserted in a motion to disregard jury findings that no evidence supported the jury‘s finding of a DTPA violation, which included a ground for failing to perform services in a good and workmanlike manner. 987 S.W.2d 50, 52 (Tex.1998). On appeal, Rocky Mountain
We recognized the existence of “an implied warranty to repair or modify existing tangible goods or property in a good and workmanlike manner” in Melody Home Manufacturing Co. v. Barnes, 741 S.W.2d 349, 354 (Tex.1987). We defined good and workmanlike as “that quality of work performed by one who has the knowledge, training, or experience necessary for the successful practice of a trade or occupation and performed in a manner generally considered proficient by those capable of judging such work.” Id. at 354.10 We further held that the implied warranty “may not be waived or disclaimed.” Id. at 355.
In Centex Homes v. Buecher, we addressed the implied warranty of good workmanship in new home construction.11 95 S.W.3d 266, 273-74 (Tex.2002). We noted that the “implied warranty of good workmanship serves as a ‘gap-filler’ or ‘default warranty‘; it applies unless and until the parties express a contrary intention.” Id. at 273. We held that the implied warranty of good workmanship “attaches to a new home sale if the parties’ agreement does not provide how the builder or the structure is to perform.” Id. Specifically, we stated that, when “the parties’ agreement sufficiently describes the manner, performance or quality of construction, the express agreement may supersede the implied warranty of good workmanship.” Id. at 268.
The Melody Home implied warranty of good and workmanlike repair of tangible goods or property—like the implied warranty of good workmanship for a new home in Buecher—is a “gap-filler” warranty. See id. at 273 (citing to Melody Home for the definition of good workmanship). As in Buecher, this gap-filler warranty may not be disclaimed but may be superseded if “the parties’ agreement sufficiently describes the manner, performance or quality” of the services. Id. at 268. 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. See id. at 273 (“Thus, the implied warranty of good workmanship attaches to a new home sale if the parties’ agreement does not provide how the builder or the structure is to perform.“).
Here, the parties’ agreement includes two warranty provisions. First, the warranty certificate provides that Olshan
In total, the warranty provisions required Olshan to repair the foundation with the Cable Lock system, to perform the work in a good and workmanlike manner, and to adjust the foundation due to settling for the life of the home. 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.12 Buecher, 95 S.W.3d at 268.
The jury found that Olshan did not breach the express warranty. Instead, the jury found that Olshan breached the implied warranty of good and workmanlike repairs and engaged in misrepresentations that violated the DTPA. The trial court entered judgment for Gonzales, awarding $101,000 in damages for the implied warranty and DTPA claims, and attorney‘s fees and engineering fees under the DTPA. Because we have concluded this express warranty superseded the implied warranty of good and workmanlike repairs, the implied warranty cannot serve as a basis for the judgment.
Concerning Gonzales‘s DTPA claim, the court of appeals held the claim was time-barred because it accrued at the latest in October 2003, when an Olshan employee informed her Olshan was “not doing a good job under the house [and it was] the worst job [he had] ever seen [and she should] find an attorney because [her] house is messed up.” 345 S.W.3d at 438-39 (alterations in original). We agree.
The DTPA provides that suits under the chapter “must be commenced within two years after the date on which the false, misleading, or deceptive act or practice occurred or within two years after the consumer discovered or in the exercise of reasonable diligence should have discovered the occurrence of the false, misleading, or deceptive act or practice.”
Here, Olshan repaired the foundation in July 2001. In April 2002, Gonzales noticed cracks in walls and sticking windows and doors. She testified that she knew something was wrong and that the foundation was shifting. Gonzales further testified that when Olshan was re-leveling the foundation in October 2003, an Olshan employee informed her that “[t]hey are not doing a good job under the home.... In fact, it‘s the worst job I have ever seen” and that “[i]f I were you, I would find an attorney because your house is messed up.” Gonzales purchased a camera for the employee to document the defective work, but the same day, “the camera was missing.” Gonzales testified that she heard the foreman instruct the crew not to speak to her and that “[a]nybody taking pictures is going to be fired on the spot.” Gonzales‘s exchange with the Olshan employee conclusively established that she knew of the injury in October 2003, without regard to whether she knew the specific nature of each of Olshan‘s wrongful acts that caused her injury. See KPMG, 988 S.W.2d at 750. Gonzales filed suit on July 6, 2006, over two years and eight months later.13 Absent the application of an equitable tolling doctrine, the evidence conclusively established that Gonzales‘s DTPA claims are time barred because she brought them more than two years after discovering her injury. See KPMG, 988 S.W.2d at 750;
Gonzales contends that Olshan engaged in fraudulent concealment, making her claim timely. We disagree. The doctrine of fraudulent concealment tolls limitations “because a person cannot be permitted to avoid liability for his actions by deceitfully concealing wrongdoing until limitations has run.” S.V. v. R.V., 933 S.W.2d 1, 6 (Tex.1996). The DTPA establishes a 180-day limit on tolling for fraudulent concealment.
Gonzales also argues that the common-law doctrine of fraudulent concealment tolls limitations for DTPA claims and is not limited to 180 days as required by the DTPA limitations statute. We have previously rejected a similar argument. In Underkofler v. Vanasek, the plaintiff
III. Conclusion
The implied warranty of good and workmanlike repair or modification to tangible goods or property is a “gap filler” warranty that implies terms into a contract that fails to describe how the party or service is to perform. Although the parties cannot disclaim this warranty outright, an express warranty in their contract can fill the gaps covered by the implied warranty and supersede it if the express warranty specifically describes the manner, performance, or quality of the services. Here, the parties agreed that Olshan would perform the work in a good and workmanlike manner, would use the Cable Lock foundation repair system, and would adjust the foundation for the life of the home if the foundation settled. This express warranty sufficiently describes the manner, performance, and quality of the services so as to supersede the implied warranty. Because the jury found that Olshan did not breach the express warranty, Gonzales cannot prevail on her warranty claims. Gonzales‘s only remaining claim is under the DTPA. Because Gonzales learned of her injury directly from Olshan more than two-and-one-half years before she filed suit, her DTPA claim is barred by limitations, even assuming the application of the DTPA‘s 180-day tolling provision for fraudulent concealment. We affirm the judgment of the court of appeals.