NUMBER 13-21-00262-CV
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
ARAN & FRANKLIN
ENGINEERING, INC., Appellant,
v.
CHRIS ZODY D/B/A NEW
MILLENIUM CONSTRUCTION GROUP, Appellee.
On appeal from the 36th District Court
of Aransas County, Texas.
MEMORANDUM OPINION
Before Chief Justice Contreras and Justices Benavides and Longoria
Memorandum Opinion by Justice Longoria
This is an interlocutory appeal from the trial court’s denial of a motion to dismiss
with prejudice under Chapter 150 of the Texas Civil Practice and Remedies Code. See
TEX. CIV. PRAC. & REM. CODE ANN. § 150.002(f) (authorizing an immediate interlocutory
appeal of an order denying a motion for dismissal under § 150.002). In its sole issue,
appellant Aran & Franklin Engineering, Inc. (Aran & Franklin) argues it is entitled to
dismissal of the claims asserted by appellee Chris Zody d/b/a New Millennium
Construction Group (New Millennium). Aran & Franklin argues that New Millennium failed
to file a certificate of merit in compliance with Chapter 150 of the Texas Civil Practices
and Remedies Code in support of its claims, and that the trial court erred in denying its
motion to dismiss. See id. § 150.002(e). We reverse and remand.
I. BACKGROUND & PROCEDURAL HISTORY
New Millennium contracted with Hidden Oaks Association, Inc. (Hidden Oaks) as
the general contractor on a roofing project. New Millennium hired Goliath Building
Services, Inc. (Goliath) to repair the roof and obtain a Texas Windstorm Insurance
Association (TWIA) certificate, known as the WPI 8 certification. Subsequently, New
Millennium entered into a subcontract in which Aran & Franklin agreed to serve as
appointed qualified inspectors (AQI) for the project.
In its third-party petition, New Millennium alleges that as the AQI, Aran & Franklin
“improperly and negligently informed [New Millennium] that the inspection of Goliath’s
work was satisfactory, that the WPI 8 certification would be issued, and that it was
appropriate for New Millennium to pay Goliath for its work.” New Millennium argues that
it paid Goliath only in light of Aran & Franklin’s representations regarding Goliath’s work;
however, the WPI 8 certification was not issued. Because the WPI 8 certification was not
issued, Hidden Oaks filed suit against New Millennium alleging negligence, breach of
warranty, breach of contract, and intentional misrepresentations. New Millennium, in turn,
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brought its third-party claim against Aran & Franklin for contribution, negligence,
intentional and/or negligent misrepresentation, indemnity, breach of contract, breach of
express warranty, and breach of implied warranty.
Aran & Franklin filed a motion to dismiss New Millennium’s third-party claims with
prejudice, arguing that New Millennium was required to file a certificate of merit pursuant
to Chapter 150 of the Texas Practice and Remedies Code. See id. § 150.002. New
Millennium filed a response asserting that no certificate of merit was necessary because
Aran & Franklin “did not perform any professional engineering services”; rather, New
Millennium contended Aran & Franklin served as AQI. To its response, New Millennium
attached a verification signed by one of its attorneys, the affidavit of Rolando R. Rubiano,
a professional engineer, and various sections of the insurance code. Aran & Franklin filed
a reply along with its objections to New Millennium’s attached verification and Rubiano’s
affidavit.
The trial court denied the motion to dismiss. In its order, the trial court sustained
Aran & Franklin’s objections to the verification relating to the attorney’s personal
knowledge of any factual matters, but it overruled the remainder of the objections,
including those relating to Rubiano’s affidavit. This interlocutory appeal followed.
II. ANALYSIS
In a single issue on appeal, Aran & Franklin argues that the trial court abused its
discretion by denying its motion to dismiss because New Millennium was required to file
a certificate of merit pursuant to Chapter 150. See id.
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A. Standard of Review & Applicable Law
“We review a trial court’s order on a motion to dismiss for failure to file a certificate
of merit in accordance with [Texas] Civil Practice & Remedies Code [§] 150.002 for an
abuse of discretion.” TRW Eng’rs, Inc. v. Hussion St. Bldgs., LLC, 608 S.W.3d 317, 319
(Tex. App.—Houston [1st Dist.] 2020, no pet.); see Pedernal Energy, LLC v. Bruington
Eng’g, Ltd., 536 S.W.3d 487, 493–95 (Tex. 2017) (discussing trial court’s discretion to
grant dismissal with or without prejudice). “A court abuses its discretion if it fails to analyze
or apply the law correctly,” TRW Eng’rs, 608 S.W.3d at 319, and when it makes decisions
in an arbitrary or unreasonable manner, without reference to guiding rules or principles.
Pedernal Energy, 536 S.W.3d at 492.
When resolution of an appellate issue requires interpretation of a statute, we
engage in a de novo review. See id. at 491. Our goal in construing a statute is to determine
and give effect to the Legislature’s intent. Id. (citing Tex. Mut. Ins. v. Ruttiger, 381 S.W.3d
430, 452 (Tex. 2012)). “We look to and rely on the plain meaning of a statute’s words as
expressing legislative intent unless a different meaning is supplied, is apparent from the
context, or the plain meaning of the words leads to absurd or nonsensical results.” Id.;
Crosstex Energy Servs., L.P. v. Pro Plus, Inc., 430 S.W.3d 384, 389–90 (Tex. 2014). “We
also take statutes as we find them and refrain from rewriting text chosen by the
Legislature.” Pedernal Energy, 536 S.W.3d at 492.
B. Applicability of Chapter 150
Section 150.002 of the Texas Civil Practice and Remedies Code requires a sworn
“certificate of merit” to accompany any lawsuit “for damages arising out of the provision
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of professional services by a licensed or registered professional.”. TEX. CIV. PRAC. & REM.
CODE ANN. § 150.002. The term “licensed or registered professional” includes a “licensed
professional engineer” and “any firm in which such licensed or registered professional
practices.” Id. § 150.001(1-c). Subsection 150.002(e) entitles the defendant to dismissal
if the certificate is not timely filed. Id. § 150.002(e); see also LaLonde v. Gosnell, 593
S.W.3d 212, 221 (Tex. 2019). “To determine whether and how § 150.002 applies, we
consider the live pleadings when the trial court ruled on the motion to dismiss.” Jennings,
Hackler & Partners, Inc. v. N. Tex. Mun. Water Dist., 471 S.W.3d 577, 581 (Tex. App.—
Dallas 2015, pet. denied); see TDIndustries, Inc. v. Rivera, 339 S.W.3d 749, 753 (Tex.
App.—Houston [1st Dist.] 2011, no pet.).
Section 150.002 does not state that the specific acts underlying the claim must
themselves constitute the provision of professional services in order for the certificate of
merit requirement to apply. Instead, the suit must be “for damages arising out of the
provision of professional services.” TEX. CIV. PRAC. & REM. CODE ANN. § 150.002(a)
(emphasis added); see also TDIndustries, 339 S.W.3d at 754 (holding claim arises out of
the provision of professional services if claim implicates the professional’s education,
training, and experience in applying special knowledge or judgment). To determine
whether a cause of action against an engineering firm is “for damages arising out of the
provision of professional services,” we compare the allegations in the petition to the
definition of the practice of engineering in § 1001.003 of the Texas Occupations Code.
See TEX. CIV. PRAC. & REM. CODE ANN. § 150.001(3); CBM Eng’rs, Inc. v. Tellepsen
Builders, L.P., 403 S.W.3d 339, 343 (Tex. App.—Houston [1st Dist.] 2013, pet. denied);
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see also TEX. OCC. CODE ANN. § 1001.003. The “practice of engineering” is defined by the
Texas Occupations Code as:
the performance of or an offer or attempt to perform any public or private
service or creative work, the adequate performance of which requires
engineering education, training, and experience in applying special
knowledge or judgment of the mathematical, physical, or engineering
sciences to that service or creative work.
TEX. OCC. CODE ANN. § 1001.003(b). Chapter 150 adopts this definition. TEX. CIV. PRAC.
& REM. CODE ANN. § 150.001(3) (defining “practice of engineering” as the meaning
assigned in TEX. OCC. CODE ANN. § 1001.003)).
1. Practice of Engineering
The question before this Court, as posed by Aran & Franklin, is whether Aran &
Franklin was providing professional services and operating in an engineering capacity in
performing its role as AQI for the roofing project.
New Millennium argues that Aran & Franklin was merely operating as an AQI
relating to inspections of “ongoing improvements,” and as such, the work performed was
not within the purview of engineering services. We are not bound by the labels that the
plaintiff uses in formulating its pleadings. Carter & Burgess, Inc. v. Sardari, 355 S.W.3d
804, 810 (Tex. App.—Houston [1st Dist.] 2011, no pet.) (first citing Cap. One v. Carter &
Burgess, Inc., 344 S.W.3d 477, 482 (Tex. App.—Fort Worth 2011, no pet.); and then citing
UOP, L.L.C. v. Kozak, No. 01–08–00896–CV, 2010 WL 2026037, at *6 (Tex. App.—
Houston [1st Dist.] May 20, 2010, no pet.)). Rather, we look to the substance of New
Millennium’s pleadings to determine if its claims against Aran & Franklin arise out of the
practice of engineering. See TEX. OCC. CODE ANN. § 1001.003(b).
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New Millennium alleges that Aran & Franklin agreed to serve as an AQI for the
project and as such, its responsibilities under applicable regulations included:
(3) Inspection. The appointed qualified inspector or a designated
representative of the appointed qualified inspector must inspect for
compliance with the applicable windstorm building code each ongoing
improvement during each major construction phase, including the
foundation stage; rough framing stage; final framing stage, including
attachment of component and cladding items and installation of windborne
debris protection; and installation of mechanical equipment. The appointed
qualified inspector’s designated representatives may assist in conducting
inspections, but the appointed qualified inspector must closely monitor and
provide direct supervision of any designated representative assisting with
the inspection process.
28 TEX. ADMIN. CODE § 5.4621(3). In its third-party petition, New Millennium alleges that:
Aran & Franklin failed to comply with one or more of its obligations [as AQI]
under Rule § 5.4621, including but not limited to it failing to act with
reasonable care and competence required of it as an [AQI], failure to inspect
the work being performed for compliance with the applicable windstorm
building code during each major stage of the work/improvements, and/or
failing to closely monitor and provide direct supervisions to any designated
representative assisting with the inspection process.
The Texas Administrative Code states that an AQI is “[a]n engineer licensed by
the Texas Board of Professional Engineers and appointed by [the Texas Department of
Insurance] as a qualified inspector under Insurance Code §[ ]2210.254(a)(2).” Id.
§ 5.4601(2) (emphasis added).
New Millennium, in its response to Aran & Franklin’s motion to dismiss and in its
appellate briefing, contends that “inspections of ‘[o]ngoing [i]mprovements’ are not the
provision of professional engineering services for the simple fact that, under the Texas
Insurance Code and the Texas Administrative Code, non-engineers are also qualified to
do such inspections.” New Millennium cites § 2210.254 of the Texas Insurance Code to
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support its contention that non-engineers are able to act in the capacity for which Aran &
Franklin was hired on the roofing project. See TEX. INS. CODE ANN. § 2210.254. Section
2210.254 states:
(a) For purposes of this chapter, a “qualified inspector” includes:
(1) a person determined by the department to be qualified
because of training or experience to perform building
inspections;
(2) a licensed professional engineer; and
(3) an inspector who:
(A) is certified by the International Code Council, the
Building Officials and Code Administrators
International, Inc., the International Conference of
Building Officials, or the Southern Building Code
Congress International, Inc.;
(B) has certifications as a buildings inspector and coastal
construction inspector; and
(C) complies with other requirements specified by
commissioner rule.
(b) A windstorm inspection may be performed only by a qualified
inspector.
(c) Before performing building inspections, a qualified inspector must be
approved and appointed or employed by the department.
(d) The department may charge a reasonable fee for the filing of
applications by and determining the qualifications of persons for
appointment as qualified inspectors.
(e) The department may establish an annual renewal period for persons
appointed as qualified inspectors.
Id.
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However, New Millennium filed a cause of action against Aran & Franklin for
damages arising out of Aran & Franklin’s failure “to comply with one or more of its
obligations under Rule [sic] § 5.4621,” including inspection of the project “for compliance
with the applicable windstorm building code during each major stage of the
work/improvements.” See 28 TEX. ADMIN. CODE § 5.4621(3).
The Texas Occupations Code states that the practice of engineering includes:
a service, design, analysis, or other work performed for a public or private
entity in connection with a utility, structure, building, machine, equipment,
process, system, work, project, or industrial or consumer product or
equipment of a mechanical, electrical, electronic, chemical, hydraulic,
pneumatic, geotechnical, or thermal nature[.]
TEX. OCC. CODE ANN. § 1001.003(c)(10). Here, according to its petition, New Millennium
hired Aran & Franklin to inspect and analyze Goliath’s work on the roof of the building for
compliance with applicable windstorm building code. Comparing New Millennium’s
allegations to the definition of the practice of engineering, we hold that the allegations
arise out of Aran & Franklin’s provision of professional services as New Millennium
alleges Aran & Franklin failed to properly inspect a building or structure for compliance in
order to receive a WPI 8 certificate.
Furthermore, New Millennium’s allegations specifically call into question Aran &
Franklin’s compliance with § 5.4621 of the Texas Administrative Code, which, by its own
definition, requires an engineer to perform the work of an AQI. See id. § 5.4601(2)
(definining an AQI as “[a]n engineer licensed by the Texas Board of Professional
Engineers and appointed by TDI as a qualified inspector under Insurance Code
§ 2210.254(a)(2)” (emphasis added)). Regardless of whether a non-engineer could
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perform the inspections as New Millennium argues, it is clear that the claims New
Millennium raised against Aran & Franklin arose out of engineering services.
As such, we conclude that New Millennium’s allegations “ar[ose] out of” Aran &
Franklin’s practice of engineering. See TEX. CIV. PRAC. & REM. CODE ANN. § 150.001(3);
TEX. OCC. CODE ANN. § 1001.003; 28 TEX. ADMIN. CODE § 5.4601(2); CBM Eng’rs, Inc.,
403 S.W.3d at 343; see also Jordan & Assocs. v. Wells, No. 01-14-00992-CV, 2015 WL
4591786, at *2 (Tex. App.—Houston [1st Dist.] July 30, 2015, no pet.) (mem. op.). We
reject New Millennium’s argument and hold that the certificate of merit requirement
applied in this case. Accordingly, we sustain Aran & Franklin’s sole issue.
Having determined that Chapter 150 requires dismissal of New Millennium’s claims
against Aran & Franklin, we are faced with the issue of whether the dismissal should be
with or without prejudice. See TEX. CIV. PRAC. & REM. CODE ANN. § 150.002(e) (stating
that “dismissal may be with prejudice”). “The Texas Supreme Court has characterized the
granting of dismissal with prejudice as being ‘discretionary,’ stating that in exercising its
discretion in this regard, the trial court must be guided by the ‘broader purposes of the
statute.’” Cimarron Eng’g, LLC v. Miramar Petroleum, Inc., No. 13-14-00163-CV, 2014
WL 2937012, at *5 (Tex. App.—Corpus Christi–Edinburg June 26, 2014, no pet.) (mem.
op.) (citing CTL/Thompson Tex., LLC v. Starwood Homeowner’s Ass’n, Inc., 390 S.W.3d
299, 301 (Tex. 2013) (per curiam)). The Supreme Court has explained that “dismissal
[with prejudice] is a sanction . . . to deter meritless claims and bring them quickly to an
end.” Id.
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Here, because the trial court denied Aran & Franklin’s motion to dismiss, it did not
decide the prejudice issue. Accordingly, we believe it is appropriate to remand the case
to the trial court for a determination of whether the dismissal of New Millennium’s claims
should be with or without prejudice. See CTL/Thompson Tex., LLC, 390 S.W.3d at 301
(declining to decide in first instance whether dismissal of plaintiff’s suit for failure to file
adequate certificate of merit should be with or without prejudice); Sharp Eng’g v. Luis,
321 S.W.3d 748, 752–53 (Tex. App.—Houston [14th Dist.] 2010, no pet.) (same); see
also Cimarron Eng’g, LLC, 2014 WL 2937012, at *5.
III. CONCLUSION
We reverse the trial court’s order denying Aran & Franklin’s motion to dismiss and
remand the case to the trial court with instructions for the trial court to enter an order
dismissing New Millennium’s claims against Aran & Franklin, to determine whether the
dismissal should be with or without prejudice, and for any further proceedings consistent
with this memorandum opinion.
NORA L. LONGORIA
Justice
Delivered and filed on the
22nd day of December, 2022.
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