In a case somewhat comparable to the Corpus Christi Court of Appeals’ decision we discussed in yesterday’s post, a 2-1 majority of El Paso Court of Appeals has reached the opposite conclusion with respect to whether a defendant design professional waived the right to dismissal for failure to file a certificate of merit as required by §150.002, CPRC. Gonzalez v. Momentum Design & Construction, Inc. (No. 08-19-00004-CV) arose from a worksite accident in which an employee of El Paso Electric (Gonzalez) fell through a fiberglass cover at an El Paso substation, causing serious injuries. Gonzalez filed suit against the construction company, but a month later nonsuited the company and instead asserted claims against CSAC, the entity that designed and built the fiberglass cover. Almost two years into the litigation, CSAC identified Momentum as the designer of the cover and alleged negligence design. Gonzalez subsequently filed an amended petition adding Momentum as a defendant. Gonzalez did not file a §150.002 certificate of merit with the petition. Momentum did not object or move to dismiss in its answer. CSAC joined Momentum as a responsible third party. Momentum initiated discovery but did not move to dismiss Gonzalez’s claims under §150.002 for 17 months. It then filed an amended answer asserting for the first time Gonzalez’s failure to file a certificate of merit as an affirmative defense. The trial court dismissed Gonzalez’s claims against Momentum. Gonzalez filed an interlocutory appeal.
The facts here differ from the Corpus Christi case in that the waiver issue involves the non-filing of the required certificate as opposed to filing an insufficient one. Nevertheless, the El Paso Court of Appeals’ analysis follows the same law but reaches a contrary result. As you recall, the Corpus Christi court of appeals determined that the engineering firm did not impliedly waive its right to seek dismissal although it: (1) did not contest the affidavit in its original answer; (2) submitted discovery requests prior to filing its motion; and (3) made a traditional summary judgment motion. The Corpus court opined that §150.002 does not require a defendant to object to the certificate of merit in its answer (unlike an affirmative defense, which must be affirmatively pleaded) and sets sets no deadline for a motion to dismiss.
The El Paso court determined that while 150.002 required Gonzalez to file a certificate, Momentum waived its right to dismissal. The court’s analysis relied heavily on SCOTX’s decisions in Crosstex Energy Servs., L.P. v. Pro Plus, Inc., 430 S.W.3d 384 (Tex. 2014) and LaLonde v. Gosnell, 595 S.W.3d 212 (Tex. 2019), which held that a party’s intent to waive or relinquish a known right “must be clearly indicated by the surrounding facts and circumstances” and is so indicated when the party’s conduct is “unequivocally inconsistent” with claiming that right. In LaLonde, SCOTX laid out a five-part test to determine “intent”: (1) participation in discovery; (2) the stage of the litigation at which dismissal is sought; (3) the time elapsed in litigation; (4) seeking affirmative relief; and (5) participating in alternative dispute resolution.
Applying these factors, the court found that Momentum’s participation in discovery, which included several oral deposition notices, deposition subpoenas, subpoenas duces tecum, and initiation and responses of and to written discovery requests (particularly Momentum’s discovery related to the plaintiff’s injury and treatment thereof) strongly indicated an intention to litigate the matter, not simply, as Momentum claimed, an effort to “learn more about the case” or to “parry a plaintiff’s attacks.” It found further that the 17-month period between the second amended petition which brought Momentum into the lawsuit and Momentum’s motion to dismiss was long enough to indicate intent to waive (in LaLonde the lag was 40 months, which SCOTX found too long, but in Crosstex an eight-month delay was not enough to show waiver). Finally, the court considered Momentum’s motion to join El Paso Electric as a responsible third party sufficient to meet the “seeking affirmative relief” prong of the test. Based on “the totality of the circumstances,” the court found that Momentum waived its right to dismissal.
Justice Alley dissented on the basis that the majority overweighted Momentum’s participation in discovery and request for affirmative relief. He pointed to gaps in the record that made it impossible to determine “unequivocally” that Momentum’s engagement in what might be considered standard discovery indicated an intention to relinquish its right to dismissal under §150.002. Further, he notes, Gonzalez argued both to the trial court and the court of appeals that the certificate of merit requirement only applied to the original petition, not to the amended petition that asserted claims against Momentum. Faced with such an argument, a prudent defense counsel must be prepared to defend the merits of the lawsuit in any case. With respect to Momentum’s request to designate a responsible third party, Justice Alley focuses on the timing of the motion, which was filed the day after CSAC filed its own motion to bring El Paso into the case. At that time, he points out, Momentum’s counsel had been in the case for one week. Again, without knowing more about the case at that point, a prudent defense lawyer must protect its client’s interests in any way necessary. Finally, Justice Alley does not find the 17-month delay out of the ordinary given the circumstances and the specific discovery schedule to which the parties agreed in this case. He cited a number of possible reasons for the delay, none of which “unequivocally” demonstrated an intent to waive §150.002.
Once more we have a certificate of merit case with somewhat messy facts and a lot riding on the outcome. We will wait to see whether this case settles or moves on to SCOTX.