Supreme Court Rules against Homeowner

Even though a company’s employee stated the foundation repair it performed was the “worst” job he had seen, the Texas Supreme Court ruled in favor of the company and against the homeowner in the recent case of Gonzales v. Southwest Olshan Foundation Repair Company, ___ S.W.3d ___ (Tex. 2013).

In Olshan, the homeowner had initially suffered foundation problems due to a water leak. So, she contacted a plumber as well Southwest Olshan Foundation Repair Company. The contract documents stated that Olshan would perform the job in a good and workmanlike manner.

Months after the repair, the homeowner discovered “doors not locking, windows not opening, and new cracks appearing.” A year later, Olshan excavated tunnels for further plumbing repairs, and then leveled the foundation three months after that. But it had to be called out again in just two months for additional repairs. While there, a crewmember told the homeowner it was the “worst job I have ever seen,” and even advised her to contact an attorney. When she would not let Olshan fill in the tunnels based upon the employee’s advice, Olshan left the jobsite for many months. But, in the meantime, it had sent an engineer who claimed the foundation was functioning properly. The following year, it again sent an engineer who claimed the foundation was proper. A year after that, when more cracking appeared, she hired her own engineer, who pointed out several ways the foundation repair was flawed. Based upon that, she filed suit the next month.

At trial, the jury returned a verdict in the homeowner’s favor. But the Supreme Court reversed the jury, and ruled against the homeowner in two ways. First, it held that her remedies under the Deceptive Trade Practices Act were barred by limitations. She asserted that limitations should be extended by a common law doctrine called fraudulent concealment, since the engineers sent by Olshan assured her that the foundation was proper. But the Court said that a 180-day provision in the statute overruled the common law on this issue.

Second, the court ruled that a different common law doctrine to protect consumers had been superseded by the contract from Olshan. In particular, it has been the rule in Texas for 25 years, since a case called Melody Home, that the law will imply a warranty that the repair of tangible goods or property will be performed in a good and workmanlike manner. In the present case, the Supreme Court determined that this common law duty was addressed by the contract. “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.” By this fashion, Olshan was able to escape its duty imposed by the common law.

If you or someone you know have been a victim of a deceptive trade practice, contact the attorneys at Abraham, Watkins, Nichols, Agosto, Aziz & Stogner by calling (713) 222-7211 or 713-222-7211.