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Engineering and Terminal Services, L.P. v. Tarsco, Inc.

Court of Appeals of Texas, Fourteenth District

April 27, 2017

ENGINEERING AND TERMINAL SERVICES, L.P., Appellant
v.
TARSCO, INC. AND ORCUS FIRE PROTECTION, LLC, Appellees

         On Appeal from the 215th District Court Harris County, Texas Trial Court Cause No. 2015-26137

          Panel consists of Chief Justice Frost and Justices Brown and Jewell.

          OPINION

          Kevin Jewell Justice

         In this certificate of merit case, we must determine whether the trial court erred by dismissing the third-party claims of Engineering & Terminal Services, L.P. ("ETS") against TARSCO, Inc. and Orcus Fire Protection, LLC because ETS did not file a certificate of merit with its third-party petition. In Jaster v. Comet II Construction, Inc., 438 S.W.3d 556 (Tex. 2014), five justices who joined in the court's judgment agreed that a third-party plaintiff is not "the plaintiff" in an "action or arbitration proceeding" and thus is not subject to the certificate of merit requirement in Civil Practice and Remedies Code section 150.002. The question presented in this appeal is whether the certificate of merit requirement applies to a third-party petition filed by an original plaintiff seeking contribution from a third-party defendant. We conclude that ETS, a third-party plaintiff, was not required to file a certificate of merit with its third-party petition against TARSCO and Orcus. We reverse and remand for further proceedings consistent with this opinion.

         Background

         ETS is an engineering firm. Buckeye Partners, LP contracted with ETS to provide engineering design and support services for construction of a tank farm and other petroleum processing facilities, as well as a marine terminal, in the Corpus Christi area. ETS, in turn, subcontracted with TARSCO to provide on-site engineering and design services for the part of the project known as "the LPG process facility in Area 5000." Separately, ETS subcontracted with Orcus to provide fire-protection engineering consulting services.

         ETS sued Buckeye for breach of contract based on Buckeye's alleged failure to pay for ETS's engineering services. In response to ETS's original petition, Buckeye filed counterclaims against ETS, alleging that ETS's engineering designs contained errors, omissions, and other deficiencies that caused Buckeye substantial damages totaling over $3, 000, 000. As relevant here, Buckeye complained in part about work that ETS subcontracted to TARSCO and Orcus. Buckeye was not required to file a certificate of merit with its counterclaim, [1] and our record does not indicate whether it did so.

         ETS, as a third-party plaintiff, filed a third-party petition against TARSCO and Orcus based on the allegedly defective engineering and design services forming the basis of Buckeye's counterclaim. ETS sought contribution damages from TARSCO and Orcus to the extent that ETS was liable to Buckeye. ETS still denied liability and denied Buckeye's allegations that the engineering and design services were defective. ETS did not file a certificate of merit with its third-party petition against TARSCO and Orcus.

         TARSCO and Orcus filed motions to dismiss ETS's third-party claims under Texas Civil Practice and Remedies Code section 150.002 because ETS did not file a certificate of merit with its third-party petition. In relevant part, section 150.002, entitled "Certificate of Merit, " provides:

In any action or arbitration proceeding for damages arising out of the provision of professional services by a licensed or registered professional, the plaintiff shall be required to file with the complaint an affidavit of a third-party licensed architect, licensed professional engineer, registered landscape architect, or registered professional land surveyor . . . .

Tex. Civ. Prac. & Rem. Code § 150.002.

         ETS responded to the motions to dismiss, relying on Jaster for the proposition that third-party plaintiffs are exempt from section 150.002's certificate of merit requirement. The trial court disagreed, granted TARSCO's and Orcus's motions, and dismissed ETS's claims against them with prejudice.

         ETS timely filed this interlocutory appeal, challenging the trial court's dismissal of its third-party claims against TARSCO and Orcus. See Tex. Civ. Prac. & Rem. Code § 150.002(f).

         Standard of Review

         Generally, we review a trial court's order granting a motion to dismiss under section 150.002 for an abuse of discretion. Epco Holdings, Inc. v. Chicago Bridge & Iron Co., 352 S.W.3d 265, 269 (Tex. App.-Houston [14th Dist.] 2011, pet. dism'd). A court abuses its discretion if it fails to analyze or apply the law correctly. Id.; Sharp Eng'g v. Luis, 321 S.W.3d 748, 752 (Tex. App.-Houston [14th Dist.] 2010, no pet.). But, we review the ruling de novo when, as here, none of the relevant facts are disputed and the trial court's ruling is based on statutory construction. See Epco Holdings, 352 S.W.3d at 269. The question before us is whether the certificate of merit requirement applies to ETS's third-party petition- a ...


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