DANIEL R. ROUBEIN AND WIFE, TOIEE ROUBEIN v. MARINO HOME BUILDERS, INC.--Appeal from 136th District Court of Jefferson County

NUMBER 13-01-711-CV

COURT OF APPEALS

THIRTEENTH DISTRICT OF TEXAS

CORPUS CHRISTI

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  DANIEL R. ROUBEIN AND WIFE, TOIEE ROUBEIN, Appellants,

v.

  MARINO HOME BUILDERS, INC., Appellee.

___________________________________________________________________

On appeal from the 136th District Court

of Jefferson County, Texas.

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O P I N I O N

Before Justices Dorsey, Ya ez, and Wittig[1]

Opinion by Justice Wittig

Daniel R. Roubein and wife, Topee Roubein, appellants, were dissatisfied first, with their homebuilder over construction defects, and now with the trial judge=s rulings. The trial court received the case on written submission, pursuant to a partial mediated settlement. In the mediated settlement, the damages were agreed as well as the method of trial disposition of the claims. The mediated settlement agreement was also made a Rule 11 agreement, enforceable by the parties and the court. All parties agreed to certain liquidated amounts of damages in the event the Roubeins prevailed. The parties disagreed about the applicability of statutes of limitations and other issues under the DTPA, warranty, and Residential Construction Liability Act. The parties presented their Rule 11 stipulations and other disputed matters to the trial court for its determination. The court awarded $22,500.00, but denied the Roubeins= more substantial claims.

Appellants= bring four issues. 1. The Roubeins= claims should be governed by the discovery rule, not the applicable statutes of limitations. 2. The trial court erred by not allowing a trial amendment after the case was submitted to the court. 3. Statements made by appellee=s president, Victor Marino, constituted an express warranty. And, 4. appellants refusal to accept Marino=s settlement offer to rebuild the garage without paying appellants an additional $110,000 or $125,000, was not unreasonable. We will affirm.

Background

Appellants bought a house from appellee Marino Home Builders, Inc.[2] in June of 1994. Within a year, appellants experienced problems with their new home=s air conditioning and roof. In April 1996, a pool contractor told Dr. Roubein the wall of the garage was bowing. Sometime before October 30, 1996, Dr. Roubein notified Marino Home Builders, Inc. about the garage problem. The original framer was dispatched to stabilize the garage framing with a steel beam. Victor Marino told Dr. Roubein he believed the garage problem was fixed. The garage bowed again in September 1999. And it was (again) determined the bowing of the garage walls was caused by improper framing. Suit was filed March 21, 2000.

The parties had settlement discussions to solve the problem. Appellants first demanded appellee replace the second story of the garage and pay them $110,000. Marino Home Builders agreed to replace the second story but would not pay the additional sum for alleged diminished resale value. Appellants then demanded the entire garage be replaced plus $125,000 for diminished value. Marino Home Builders agreed to rebuild the garage but refused the additional cash demand. When the initial negotiations failed, suit was then filed and eventually the case went to mediation, resulting in a partial settlement of some of the issues, plus the agreement to waive a jury, and present the matter to the trial court for trial by written submission.

The trial court initially ruled appellants damage claims to the garage were barred by the two year statute of limitations but also requested additional briefing. Appellants then requested a trial amendment to add new specific claims for implied warranties. This request was denied by the trial court.

The trial court, at the request of appellants, made findings of fact and conclusions of law. The pertinent findings included: 1. The garage was defectively constructed, but appellants did not file suit within two years of the accrual of that cause of action; 2. The defects were not inherently undiscoverable; 3. Victor Marino advised appellants he believed he fixed the garage problems; 4. Marino=s statement was not an express warranty; 5. Appellants plead no viable implied warranty theory; 6. The air conditioning and roof problems started in 1994 and appellants did not timely file suit within two years and were thus barred; and 7. The fair market value diminishment caused by the defects was $29,000. Because appellants unreasonably rejected the homebuilder=s settlement offer, they were not entitled to attorney=s fees.

Standard of Review

Legal sufficiency challenges to a trial court's findings of fact are reviewable under the same standards that are applied in reviewing evidence supporting a jury=s answer. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994). When a legal sufficiency challenge is raised by a party who bears the burden of proof on an issue, we must first examine the record for evidence and inferences supporting the challenged finding, ignoring all evidence to the contrary, to determine whether any evidence exists to support that finding. Dow Chem. Co. v. Francis, 46 S.W.3d 237, 241 (Tex. 2001). If no evidence supports the court's finding, we must review the record to determine if the contrary proposition is established as a matter of law. Id

The party complaining of the trial court's refusal to consider an amended pleading has the burden to show an abuse of discretion. Hardin v. Hardin, 597 S.W.2d 347, 349 (Tex. 1980); Clade v. Larsen, 838 S.W.2d 277, 280 (Tex. App.BDallas 1992, writ denied). We do not disturb the trial court's ruling unless the complaining party shows an abuse of discretion. Hardin, 597 S.W.2d at 349 50; Clade, 838 S.W.2d at 280.

Statute of Limitations

In their first issue, appellants maintain the trial court erred because it refused to find applicability of the discovery rule. We view this issue as framed as a Amatter of law@ challenge to the trial court=s finding that the discovery rule was not applicable. See Dow Chem. Co., 46 S.W.3d at 241. Accordingly, in the firstBand here only necessary stepBwe search the record to determine whether any evidence supports the trial court=s legal conclusion or application of law. Id. Appellants primarily rely upon Thompson v. Espy Huston & Assoc., Inc., 899 S.W.2d 415 (Tex. App.BAustin 1995, no writ). Thompson was a summary judgment case, not a trial to the court. The Austin court held: A In this case, the summary judgment evidence did not conclusively establish that a layperson could perceive any problems with Espey's services before the flooding occurred and the damage to the buildings became manifest.@ Id. at 422-23. The court merely held that an engineering consulting firm=s negligence, may not be discoverable until the manifestation of the flooding or damages they were hired to fix. However, for purposes of application of a statute of limitations, a cause of action generally accrues when the wrongful act causes an injury, regardless of when the plaintiff learns of the injury. Moreno v. Sterling Drug, Inc., 787 S.W.2d 348, 351 (Tex.1990). The discovery rule is an exception to the general rule. Id. When applicable, the discovery rule provides the limitations period runs from the date the plaintiff discovers or should, in the exercise of reasonable care and diligence, have discovered the nature of his injury. Id. But, the discovery rule has limited application to claims that can be characterized as "inherently undiscoverable," such as fraud, credit libel, and medical and legal malpractice. Snyder v. Eanes ISD, 860 S.W.2d 692, 699 700 (Tex. App.BAustin 1993, writ denied). The discovery rule is appropriate for these causes of action because it is inherently difficult for the injured party to learn of the negligent act or omission. Id. at 700.

As well perceived and articulated by the Thompson court, a contractor (or layman) cannot be expected to assess the effectiveness of the engineer=s work before there is an opportunity to test the final product. Thompson, 899 S.W.2d at 423. As found by the trial court here, appellants were already aware of three distinct construction defects on their home. They were aware, and do not contest that air conditioning defects and roof leaks were apparent in 1994. Also, in April of 1996, appellants were informed of defects in their garage, specifically a bowing of the walls. While it is most unfortunate that the repairs undertaken by the framer to the garage were apparently unsuccessful in fixing the problem, appellants were clearly on notice of this defect. Appellants did not carry their burden of proof to demonstrate their claim was inherently undiscoverable or that through the exercise of reasonable diligence they could not have discovered the nature of their injury. Moreno, 787 S.W.2d at 351. The trial court=s finding is supported by the evidence. Dow Chem. Co., 46 S.W.3d at 241. We overrule appellants= first issue.

Leave to Amend Pleadings

Parties may amend their pleadings, only with the trial court's permission, within seven days of a trial date or afterward. The trial court should permit the amendment unless the opposite party shows that filing the amendment operates as a surprise. Tex. R. Civ. P. 63; Clade, 838 S.W.2d at 280. The trial court may not refuse an amendment unless: (1) the opposing party presents evidence of surprise or prejudice; or (2) the amendment asserts a new cause of action or defense, and thus, is prejudicial on its face, and the opposing party objects to the amendment. Greenhalgh v. Service Lloyds Ins. Co., 787 S.W.2d 938, 939 (Tex.1990); Clade, 838 S.W.2d at 280.

Appellants argue their pleadings already included a warranty claim and thus to amend to add an implied warranty presents nothing new. The supporting facts were virtually identical and because the case was submitted on briefs and stipulations, no new evidence would be adduced. In fact, implied warranty had previously been pled. We review the trial court=s refusal to allow the implied warranty claim under an abuse of discretion standard. Hardin, 597 S.W.2d. at 349. As argued by appellants, the entire case was submitted to the court on briefs, agreed exhibits, and the Rule 11 stipulation. However, the Rule 11 agreement, paragraph 9 reads: APlaintiff retains all DTPA and warranty causes of action pled.@ Appellants further argue they did not waive the right to amend by agreeing they Aretained@ extant claims.

On appeal, we are constrained to determine whether or not the trial court failed to follow guiding rules and principles, thus reaching an arbitrary and unreasonable decision. Walker, 827 S.W.2d at 839. The trial court was certainly not unreasonable by enforcing the parties own Rule 11 contract. The word Apled@ connotes the then existing pleadings, not pleadings to come. See Southwest Intelecom, Inc. v. Hotel Networks Corp., 997 S.W.2d 322, 325 (Tex. App.BAustin 1999, pet. denied) (we must read the provision in its entirety, striving to give meaning to every sentence, clause, and word to avoid rendering any portion inoperative). The prejudice to appellee is patent. To allow a post submission trial amendment, would both negate the negotiated partial settlement, and expose appellee to greatly enhanced damages. Appellants have not carried their burden to demonstrate that the trial court abused its discretion. Hardin, 597 S.W.2d at 349. We overrule appellants= second issue.

Express Warranty

Appellants contend Victor Marino=s statement concerning the garage repairs constituted an express warranty. We also treat this as a matter of law challenge.[3] See Dow Chem. Co., 46 S.W.3d at 241. According to appellants, the following testimony by Dr. Roubein, established a warranty:

Question: What did Mr. Marino tell you on those occasions?

Answer: He looked at the garage and told me thatBhe offered very little explanation for what the problem was, and I didn=t pursue it very much. At that point, I took it on faith that he was going to access it and correct it appropriately. He told me what needed to be done was a placement of a steel beam and that would correct the problem.

Appellants rely upon McCrea v. Cubilla Condominium Corp., 685 S.W.2d 755 (Tex. App.BHouston [1st Dist.] 1985, ref. n.r.e.). In McCrea, the plaintiffs experienced roof problems, had them repaired, and Cubilla sent a letter stating it would continue its efforts to locate the source of the problem and Aresolve it to your satisfaction.@ Id. at 758. Appellants missed the next sentence in the letter: AIn the unlikely event we cannot locate the leak before the end of your warranty period we will, of course, stand behind our product and remedy the problem at our expense.@ Id. McCrea also holds that an express warranty is created when a seller makes an affirmation of fact or a promise to the purchaser, which relates to the sale and warrants a conformity to the affirmation as promised. Id. at 757 (citing Bormaster v. Henderson, 624 S.W.2d 655, 660 (Tex. Civ. App.BHouston [14th Dist.] 1981, no writ)). Appellants correctly argue McCrea illustrates an express warranty. However, appellants cannot demonstrate Marino warranted conformity to the affirmation. In fact, in further testimony, Dr. Roubein admits that Marino sent someone out to fix the garage and that Marino told the doctor Ahe believed it was fixed.@ As argued by appellee, a statement of opinion does not rise to the level of an affirmation of fact or promise. See Dowling v. NADW Marketing, Inc., 631 S.W.2d 726, 729 (Tex. 1982)(a specific promise is not "puffing." Rather,"puffery" is an expression of opinion by a seller not made as a representation of fact).

The mere recitals by Marino that he would send someone (in futuro) to fix the garage or that he believed the garage was fixed, do not add up to a guarantee. There is simply no expression of warranty attributable to the statement.[4] McCrea, 685 S.W.2d at 757. We conclude the evidence supports the challenged finding. Dow Chem. Co., 46 S.W.3d at 241. We accordingly overrule appellants= third issue.

Unreasonable Refusal of Offer

In their final issue, the Roubeins complain that their rejection of the builder=s settlement offer was not unreasonable. We view this issue as a factual sufficiency challenge.[5] When a party attacks the factual sufficiency of an adverse finding on an issue on which she has the burden of proof, she must demonstrate on appeal that the adverse finding is against the great weight and preponderance of the evidence. Dow Chemical Co., 46 S.W.3d at 242. The court of appeals must consider and weigh all of the evidence, and can set aside a verdict only if the evidence is so weak, or if the finding is so against the great weight and preponderance of the evidence, that it is clearly wrong and unjust. Id. In doing so, the court of appeals must "detail the evidence relevant to the issue" and "state in what regard the contrary evidence greatly outweighs the evidence in support of the verdict." Id. Whether an offer of settlement or refusal is reasonable, is a question for the trier of fact. Tex. Prop. Code Ann. ' 27.004(k) (Vernon 2000).

The trial court found that appellants unreasonably rejected the builder=s offer to settle. During negotiations, appellee met appellants= demand to replace the entire second floor of the garage. It refused to pay the additional $110,000 diminishment of value claim. Thereafter, appellants demanded the entire garage be re-built. Again, appellee acceded to this offer but would not also pay an additional $125,000 for diminishment. Appellants contend that appellee=s offer to settle was unreasonable[6] because it contained no compensation for loss of value to their property, which is true. Even though a rebuilt garage would eliminate any structural problem, there could still be a Astigma@ attached to the new garage. Appellants further contend they were endangered because the settlement offer included Marino=s own involvement in the repairs. We reject this second contention because the builder=s involvement is contemplated by the statute. Tex. Prop. Code Ann. ' 27.004(i) (Vernon 2000). Additionally, appellants argue that appellee=s offer included a request for assignment of $80,000 in insurance proceeds from appellants to appellee. Given appellee=s multiple efforts and offers to amicably resolve the garage issue and other disputes, we cannot say the evidence against the trial court=s finding greatly outweighs the evidence in support of the finding. Dow Chemical Co., 46 S.W.3d at 242. The finding is not clearly wrong and unjust. Id. Accordingly, we overrule appellants= fourth issue.

The judgment of the court is affirmed.

_________________________

DON WITTIG

Justice

Do not publish.

Tex. R. App. P.47.3.

Opinion delivered and filed

this 1st day of August, 2002.

[1]Retired Justice Don Wittig assigned to this Court by the Chief Justice of the Supreme Court of Texas pursuant to Tex. Gov=t Code Ann. '74.003 (Vernon 1998).

[2] Marino Investments was named on the earnest money contract but was not the actual builder. The actual builder was Marino Home Builders, Inc. No party contests this finding by the trial court.

[3] In its last sentence under this argument, appellants ask us, in the alternative, to remand for factual insufficiency. However, appellants neither brief nor support this contention with citation to the record. Therefore it is waived. Kang v. Hyundai Corp. (U.S.A.), 992 S.W.2d 499, 503 (Tex. App.BDallas 1999, no pet.) In any event, our analysis of the legal sufficiency, de facto demonstrates the factual sufficiency.

[4] Nor do we believe the cited testimony is any more than an expression of a future intention to send someone to repair the garage and a later opinion that the garage was fixed.

[5] At least one other court views this as a matter of law challenge. See Homes v. Alwattari, 33 S.W.3d 376, 383 (Tex. App.- Fort Worth 2000, pet. denied). We believe this is inconsistent with Tex. Prop. Code Ann. '27.004(k) (Vernon 2000)(reasonablnes or offer of settlement or refusal is question of fact).

[6] The challenged finding is that appellants=refusal of the offer was unreasonable, not that appellee=s offer was unreasonable.