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Texas Supreme Court Rules Engineer’s Conduct Evidenced Intentional Waiver Of Certificate Of Merit Requirement

In LaLonde v. Gosnell, 2019 WL 2479172 (Tex. June 14, 2019), the Texas Supreme Court held an engineer’s engagement in the judicial process, through the completion of discovery and until one month before trial, waived the Certificate of Merit requirements.

Paul and Kim Gosnell (the “Gosnells”) contracted with Thomas A. LaLonde d/b/a Lee Engineering Co. (“Lee”) to evaluate and stabilize their home’s foundation. The Gosnells alleged Lee’s work made the foundation problems worse, resulting in significant damage. The Gosnells sued Lee, but did not contemporaneously file a Certificate of Merit as required by Section 150.002 of the Texas Civil Practice and Remedies Code.

Twenty months after the lawsuit was filed, Lee filed its answer, denying the allegations and requesting attorney’s fees, but did not seek dismissal due to the failure to file a Certificate of Merit. The Parties agreed to a scheduling order and a trial date. Over the next eighteen months, the Parties conducted extensive discovery. The Parties agreed to a second scheduling order extending the deadlines and continuing the trial date. Shortly after discovery closed, the Parties participated in an unsuccessful mediation.

Two days after the failed mediation, with trial scheduled to begin in one month, Lee filed a Motion to Dismiss based on the failure to file a Certificate of Merit. The trial court granted the motion and dismissed the case. The Texas Court of Appeals reversed and remanded the case, ruling that Lee impliedly waived the Certificate of Merit requirement by engaging in litigation.

On appeal, the Texas Supreme Court relied on Crosstex Energy Services, L.P. v. Pro Plus, Inc., 430 S.W.35 384 (Tex. 2014), which held that an engineer can impliedly waive the Certificate of Merit requirement by substantially invoking the judicial process. However, a defendant does not necessarily waive it rights under Tex. Civ. Prac. & Rem. Code § 150.002 by simply engaging in any litigation. Instead, for litigation to amount to a waiver, it must be so inconsistent with the party’s rights under Tex. Civ. Prac. & Rem. Code § 150.002 that waiver can be implied from the conduct.

The Court considered various factors, including the delay in seeking dismissal, the extent to which the defendant engaged in discovery, whether the defendant sought affirmative relief and whether the defendant engaged in alternative dispute resolution. The Texas Supreme Court held Lee’s conduct showed its intent to litigate, rather than assert the statutory right to a dismissal. The Court noted Lee waited 1,219 days after the complaint was filed to seek dismissal under Tex. Civ. Prac. & Rem. Code § 150.002.

The Texas Supreme Court’s ruling affirms that the Certificate of Merit requirement may be waived as the result of a defendant invoking the litigation process. Defense counsel should verify that a Certificate of Merit is filed contemporaneously with a complaint and file a Motion to Dismiss immediately if not. Failure to take prompt action could constitute a waiver of the defense.