TL II Apartments, LLC v. a & a Masonry, Inc.

Opinion issued July 9, 2024

In The

Court of Appeals

For The

First District of Texas

————————————

NO. 01-22-00807-CV

———————————

TL II APARTMENTS, LLC, Appellant

V.

A&A MASONRY, INC., Appellee

On Appeal from the 212th District Court

Galveston County, Texas

Trial Court Case No. 18-CV-0681

MEMORANDUM OPINION

This summary judgment appeal concerns the ability of an apartment

complex owner to bring suit on an assigned stucco-work contract and a related

written warranty.

In four issues, TL II Apartments, LLC (“TL”) contends the trial court erred

in (1) concluding that TL lacked standing and capacity to sue A&A Masonry, Inc.

(“A&A”) on the assigned stucco-work contract and warranty; (2) failing to find

that A&A waived its right to challenge TL’s capacity; and (3) dismissing all of

TL’s claims.

We affirm in part and reverse and remand in part.

Background

This case stems from the construction and sale of the Tuscan Lakes II

apartment complex in League City. Tuscan Lakes II was initially owned by Egret

Bay Investors, LLC (“Egret Bay”) and developed by Davis Development.

In 2013, TX-Morrow Construction, Inc., the general contractor at Tuscan

Lakes II, entered into a subcontract agreement (“Stucco Agreement”) with A&A to

install stucco at Tuscan Lakes II.1

In April of 2014, the members of Egret Bay (collectively, “the Egret Bay

Sellers”)2 agreed to sell their interests in Egret Bay to KC Venture Group, LLC.

The deal included Tuscan Lakes II.

1

A&A did not actually install the stucco. Instead, A&A subcontracted with Juan

Nava d/b/a Nava Stone f/k/a Cervantes Stone to install the stucco.

2

The Purchase and Sale Contract listed the sellers as Beaver Creek Trust, Fred S.

Hazel, Lance A. Chernow, Keli J. Hazel, Jeffrey S. Greene, Stephen Michael

Davis, and Blake Miguel Davis Trust.

2

The Egret Bay Sellers and KC Venture subsequently signed a Purchase and

Sale Contract (“PSC”). They agreed that the closing date would occur after the

completion of Tuscan Lakes II and that KC Venture would assign the PSC to an

entity owned or controlled by NRES Holdings, LLC (“NRES”).

Under the PSC, the Egret Bay Sellers had the authority to convey and assign

all Miscellaneous Property Assets to KC Venture and would provide all Property

Contracts to KC Venture at closing.

The Miscellaneous Property Assets included all contract rights, claims and

causes of action, and warranties relating to the ownership or operation of Tuscan

Lakes II. The Property Contracts included all maintenance, service, and utility

contracts—as well as similar contracts relating to the ownership, maintenance,

construction, repair and/or operation of Tuscan Lakes II.

A few days before closing, and after the stucco-work was completed, A&A

provided a ten-year warranty (“Stucco Warranty”) to Egret Bay, Davis, and TX-

Morrow. A&A warranted that the stucco-work at Tuscan lakes II was free of any

defects.

After closing, and pursuant to the PSC, KC Venture executed an

Assignment, Acceptance and Notice Agreement (“AANA”) that assigned its rights

in the PSC (including Tuscan Lakes II) to Midwest QI Services, Inc. Midwest

3

reassigned those rights to NRES via an Assignment and Assumption of Interests

(“AAI”).

The AAI provides that “[the members of Egret Bay] do[] hereby assign,

transfer and set over to [NRES] all of Assignor’s right, title and interest in and to

the Interest, including, without limitation . . . all right, title and interest of Assignor

pursuant to the Organizational Agreement in and to all real and personal property

(including the Miscellaneous Property Assets . . .) and every other right, however

characterized, now or hereafter held by the Company, . . .”

NRES subsequently conveyed Tuscan Lakes II by special warranty deed to

TL. The conveyance included all improvements and “any and all rights, titles,

powers, privileges, easements, licenses, right-of-way and interests appurtenant to

the Land and the Improvements.”

A Bill of Sale and Assignment (“BOSA”) was also executed, which assigned

to TL all right, title, and interest in and to Tuscan Lakes II―including, as relevant

here, property contracts, including “maintenance, service or utility contracts and

similar contracts . . . which relate to the ownership, maintenance, construction or

repair and/or operation of the Project, but only to the extent transferable.” The

assignment clause in the BOSA states: “Assignor hereby assigns, sells, and

transfers, without recourse or warranty, to Assignee all of Assignor’s right, title

and interest, if any, in and to all of the Property.”

4

Issues with the stucco-work began to appear. A&A initially tried to repair

the stucco―but later refused to do so. As a result, TL sued A&A in May of 2018.

TL pleaded claims for breach of the Stucco Agreement and Stucco Warranty,

breach of express and implied warranty, and negligence.3 A&A answered with a

general denial.

Nearly four years later, A&A filed a supplemental answer. It alleged that

some of TL’s claims may be barred because A&A’s express warranty was not

issued to TL, that TL is not a direct party or third-party beneficiary to the warranty,

and that A&A and TL are contractual strangers. A&A also asserted that TL lacks

standing and capacity to sue because “[TL] is neither a direct party nor third-party

beneficiary of the agreement . . . between [A&A] and TX Morrow.”

A&A moved for traditional summary judgment. It asserted that TL could

not sue A&A because (1) TL did not own the property at the time of the alleged

injury and (2) TL is a subsequent purchaser of the property. A&A attached and

relied on the PSC, the AANA, and the AAI. A&A also argued that because of an

“as is” clause in the contract, TL could not assert any tort causes of action against

A&A.

3

TL also filed a third-party petition against the supplier of the stucco, AHI, and

against the installer of the stucco, Nava. AHI then filed a fourth-party petition

against the general contractor, TX-Morrow. TX-Morrow then filed a crossclaim

against A&A.

5

In response, TL argued that all rights, remedies, and interests to Tuscan

Lakes II were transferred and assigned to TL under the PSC, the AANA, the AAI,

the BOSA, and the special warranty deed. TL further argued that A&A failed to

establish that the injuries occurred before TL became owner and that the PSC made

an exception to the “as is” clause for representations and warranties.

TL filed a cross motion for partial summary judgment on liability only. TL

relied on the Stucco Agreement to support its status as a third-party beneficiary as

the owner of Tuscan Lakes II. TL asserted that A&A breached the Stucco

Agreement by improperly installing and supervising the installation of the stucco

system at Tuscan Lakes II and by refusing to remedy and cure the stucco issues

caused by its improper installation.4

A&A responded by, again, arguing that TL does not have a right to sue

under the Stucco Agreement or Stucco Warranty. According to A&A, there was

no express assignment of any potential claims to any subsequent purchaser. And,

while the BOSA conveyed right, title, and interest to (1) property contracts,

(2) leases, (3) permits, and (4) fixtures and tangible personal property—the Stucco

Agreement and Stucco Warranty are not property contracts as defined in the

BOSA.

4

TL also moved for summary judgment on its breach of warranty and negligence

causes of action.

6

After two hearings, the trial court signed two orders. First, it granted A&A’s

traditional motion for summary judgment and dismissed TL’s claims with

prejudice. Second, it denied TL’s motion for partial summary judgment on

liability only but did not consider the merits of TL’s motion. Instead, the trial

court’s order indicates that it denied TL’s summary judgment motion and

dismissed all of TL’s claims “because TL . . . does not have standing or capacity to

bring its claims”―the same basis on which it granted A&A’s summary judgment

motion.

TL now appeals the grant of A&A’s motion for summary judgment and the

denial of its summary judgment motion. See Tex. Mun. Power Agency v. Pub. Util.

Comm’n of Tex., 253 S.W.3d 184, 192 (Tex. 2007) (“Although the denial of

summary judgment is normally not appealable, we may review such a denial when

both parties moved for summary judgment and the trial court granted one and

denied the other.”).

Capacity

In its first issue, TL argues that the trial court erroneously granted summary

judgment in favor of A&A because, as an assignee, TL had the capacity to enforce

the Stucco Agreement and Stucco Warranty.

7

A. Standard of Review

We review a trial court’s summary judgment de novo. Id. A traditional

motion for summary judgment is properly granted when the movant establishes

that no genuine issues of material fact exist, and it is entitled to judgment as a

matter of law on the grounds expressly set forth in the motion. Browning v.

Prostok, 165 S.W.3d 336, 344 (Tex. 2005). We must take evidence favorable to

the nonmovant as true and indulge every reasonable inference from the evidence in

favor of the nonmovant. Am. Tobacco Co. v. Grinnell, 951 S.W.2d 420, 425 (Tex.

1997).

When a defendant moves for traditional summary judgment, it must either

(1) disprove at least one essential element of the plaintiff’s cause of action or

(2) plead and conclusively establish each essential element of an affirmative

defense. Fallon v. Univ. of Tex. MD Anderson Cancer Ctr., 586 S.W.3d 37, 47

(Tex. App.—Houston [1st Dist.] 2019, no pet.). If the movant satisfies its burden,

the burden shifts to the nonmovant to raise a fact issue precluding summary

judgment. Lujan v. Navistar, Inc., 555 S.W.3d 79, 84 (Tex. 2018). A fact issue

exists if more than a scintilla of evidence establishes the existence of the

challenged element. Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex.

2004).

8

More than a scintilla of evidence exists when the evidence rises to a level

that would enable reasonable and fair-minded people to differ in their conclusions.

Id. at 601 (quoting Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706, 711

(Tex. 1997)). When, as here, both sides move for summary judgment and the trial

court grants one motion and denies the other, we review the summary judgment

evidence presented by both sides, determine all questions presented, and render the

judgment the trial court should have rendered. Comm’rs Ct. of Titus Cnty. v. Agan,

940 S.W.2d 77, 81 (Tex. 1997).

B. Analysis

TL initially argues that A&A’s summary judgment motion challenged only

TL’s capacity to sue―and not standing. We agree.

The gravamen of A&A’s arguments below concerned TL’s purported lack of

privity of contract with A&A. That is a challenge to capacity, not standing.5 See

Elness Swenson Graham Architects, Inc. v. RLJ II–C Austin Air, LP, 520 S.W.3d

145, 153 (Tex. App.—Austin 2017, pet. denied); Schlein v. Griffin, No. 01-14-

00799-CV, 2016 WL 1456193, at *5 (Tex. App.—Houston [1st Dist.] Apr. 12,

2016, pet. denied) (mem. op.) (stating that “Texas courts have held that a

5

Because we interpret A&A’s argument as a challenge to capacity, it is unnecessary

to address TL’s standing. Nevertheless, TL presented evidence below that it was

aggrieved as the owner of Tuscan Lakes II when A&A refused to repair the stucco

at Tuscan Lakes II. See Austin Nursing Ctr., Inc. v. Lovato, 171 S.W.3d 845, 848–

49 (Tex. 2005) (party has standing “when it is personally aggrieved” (internal

quotations omitted)). TL has standing to bring this suit.

9

‘challenge to a party’s privity of contract is a challenge to capacity, not standing’”)

(quoting John C. Flood of DC, Inc. v. SuperMedia, L.L.C., 408 S.W.3d 645, 651

(Tex. App.—Dallas 2013, pet. denied)).

“Capacity is a party’s legal authority to go into court to prosecute or defend

a suit.” El T. Mexican Rests., Inc. v. Bacon, 921 S.W.2d 247, 249–50 (Tex. App.—

Houston [1st Dist.] 1995, writ denied). “As a general rule, the benefits and

burdens of a contract belong solely to the contracting parties, and ‘no person can

sue upon a contract except he be a party to or in privity with it.’” First Bank v.

Brumitt, 519 S.W.3d 95, 102 (Tex. 2017) (quoting House v. Hous. Waterworks

Co., 31 S.W. 179, 179 (Tex. 1895)).

Privity is established by proof that the defendant was a party to an

enforceable contract with either the plaintiff or a party who assigned its cause of

action to the plaintiff. Brown v. Mesa Distribs., Inc., 414 S.W.3d 279, 284–85

(Tex. App.—Houston [1st Dist.] 2013, no pet.). To recover on an assigned cause

of action, the party claiming that the assignment occurred must show the existence

of a cause of action capable of being assigned and that the cause of action was in

fact assigned to that party. Elness, 520 S.W.3d at 153–54. An assignment is a

manifestation by the owner of a right of his intention to transfer such right to the

assignee. Brown, 414 S.W.3d at 285. In Texas, assignments of a contract or an

10

express warranty are governed by contract law. Id.; see also Med. City Dall., Ltd.

v. Carlisle Corp., 251 S.W.3d 55, 60 (Tex. 2008).

When we construe a written contract, our primary concern is to determine

the parties’ true intent as expressed in the contract. Epps v. Fowler, 351 S.W.3d

862, 865 (Tex. 2011); Tellepsen Builders, L.P. v. Kendall/Heaton Assocs., Inc.,

325 S.W.3d 692, 695 (Tex. App.—Houston [1st Dist.] 2010, pet. denied). If the

contract is so worded that it can be given a definite or certain legal meaning, then it

may be construed as a matter of law. Coker v. Coker, 650 S.W.2d 391, 393 (Tex.

1983); Tellepsen Builders, 625 S.W.3d at 696. Unless the agreement shows that

the parties used a term in a technical or different sense, we give the terms their

plain, ordinary, and generally accepted meaning. Heritage Res., Inc. v.

NationsBank, 939 S.W.2d 118, 121 (Tex. 1996).

Under generally accepted principles of contract interpretation, all writings

that pertain to the same transaction will be considered together—even if they were

executed at different times and do not expressly refer to one another. DeWitt Cnty.

Elec. Co-op., Inc. v. Parks, 1 S.W.3d 96, 102 (Tex. 1999). This rule is a device for

ascertaining and giving effect to the intention of the parties and cannot be applied

arbitrarily. Id.

Here, both sides agree that Egret Bay originally owned Tuscan Lakes II and

that, after multiple transactions, TL became the eventual owner of Tuscan Lakes II.

11

The parties also agree that the relevant documents include: (1) the Stucco

Agreement, (2) the PSC, (3) the Stucco Warranty, (4) the AANA, (5) the AAI, and

(6) the BOSA.

But the parties diverge on two key points. First, does section 1.1.20 of the

PSC, which describes Miscellaneous Property Assets, carve out from assignment

any claims or warranties against subcontractors such as A&A? And second, does

section 1 of the BOSA assign the Stucco Agreement or Stucco Warranty to TL?

We address each point in turn.

1. Purchase and Sale Contract

PSC section 1.1.20 defines “Miscellaneous Property Assets” as,

[A]ll contract rights, . . . claims and causes of actions, . . .

warranties, . . . and other items of intangible personal property

relating to the ownership or operation of the Property and

owned by [Egret Bay], but only to the extent transferable,

[specifically excluding the general contractor construction

contract (the “Construction Contract”) and all claims, rights,

remedies and causes of action against or through the contractors

under the Construction Contract], but specifically including all

warranties and guaranties (express or implied) (other than

warranties and guaranties contained in the Construction

Contract) in connection with or arising out of the design or

construction of any of the Improvements or the performance of

any of the work, under or pursuant to the Construction Contract

or otherwise, or issued in connection with or arising out of the

fabrication, purchase, installation or repair of any fixtures,

equipment or other personal property attached to, located in or

used in connection with the Property.

12

PSC section 1.1.24 defines “Property” as “the Land and Improvements and

all rights of [Egret Bay] relating to the Land and the Improvements . . . together

with all Fixtures and Tangible Personal Property, all Property Contracts and

Leases, Permits and the Miscellaneous Property Assets.” (Emphasis added.)

And section 1.1.25 defines “Property Contracts” as:

[A]ll purchase orders, maintenance, service, or utility contracts

and similar contracts, excluding Leases, which relate to the

ownership, maintenance, construction or repair and/or operation

of the Property. . . . and shall also mean any third party

maintenance, service, marketing or other contract relating to the

Property which Property Owner is obligated to cause Property

Owner’s transferee or assign to assume or execute upon

Purchaser’s purchase of the Property.

Furthermore, within the PSC, the Egret Bay Sellers represented that they had

“all necessary right and authority to convey and assign to [KC Venture] all

Miscellaneous Property Assets, Fixtures and Personal Property required to be

conveyed and assigned to [KC Venture] hereunder.”

A&A does not dispute that the Miscellaneous Property Assets were assigned

to TL. Instead, it contends that TL could not be assigned claims against A&A

because the PSC’s Miscellaneous Property Assets provision carved out claims

against the general contractor, TX Morrow, and itself, as a subcontractor. A&A

argues that the carve out sentence―“specifically excluding the general contractor

construction contract (the “Construction Contract”) and all claims, rights, remedies

and causes of action against or through the contractors under the Construction

13

Contract”―initially uses the term “general contractor,” a defined term, but then

refers to “contractors,” which is undefined. (Emphasis added.)

According to A&A, because the Miscellaneous Property Assets provision

uses the undefined term “contractors,” we should apply an ordinary meaning to

that term which would necessarily include general contractors and subcontractors.

See Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 662 (Tex. 2005). A&A

asserts that such a reading of Miscellaneous Property Assets excludes claims

against subcontractors, like A&A, from being assigned.

TL argues that “the exclusion of rights against the general contractor or

arising under the general contract has nothing to do with direct claims against

subcontractor A&A based on the [Stucco Agreement] or [Stucco Warranty]. Both

of those documents grant direct causes of action to the property owner against

A&A.” And the Miscellaneous Property Assets specifically include warranties.

Even assuming that A&A has correctly construed the term “contractors” to

include both general contractors and subcontractors, A&A’s resulting

interpretation of the provision is untenable. It ignores the beginning of the

sentence which states, “excluding the general contractor construction contract (the

“Construction Contract”)” and ignores the next four words after “contractors”—

“under the Construction Contract.” We must read this contract language together

and in context, not in isolation from each other. See Hysaw v. Dawkins, 483

14

S.W.3d 1, 13 (Tex. 2016). Indeed, we may not rewrite the Miscellaneous Property

Assets provision or add to its language under the guise of interpreting it. See

Maxey v. Maxey, 617 S.W.3d 207, 221 (Tex. App.—Houston [1st Dist.] 2020, no

pet.).

Moreover, the Construction Contract which is referenced in this part of the

Miscellaneous Property Assets provision was never produced and thus not before

the trial court when it granted summary judgment. As a result, A&A could not

(and did not) establish as a matter of law that TL lacked capacity to sue based on

any carve out of assigned claims under the Construction Contract. See Amedisys,

Inc. v. Kingwood Home Health Care, LLC, 437 S.W.3d 507, 511 (Tex. 2014)

(movant has burden to submit sufficient evidence to establish that it is entitled to

judgment as a matter of law; where movant fails to do so, the burden does not shift

to the non-movant and the non-movant need not respond or present any evidence).6

Additionally, A&A’s interpretation of this language in the Miscellaneous

Property Assets provision (as TL’s excluding claims against A&A) would conflict

6

See, e.g., Curlee Mfg. Co. v. Charter Oak Fire Ins. Co., No. B14-92-01298-CV,

1994 WL 222215, at *5 (Tex. App.—Houston [14th Dist.] May 26, 1994, writ

denied) (not designated for publication) (where only portion of insurance policy at

issue was in record, insurer’s obligation to reimburse insured could not be

determined and insurer did not meet its summary judgment burden to prove as

matter of law that insured had no right to reimbursement); David Evans

Contracting, Inc. v. Gen. Acc. Ins. Co. of Am., No. C14-89-00999-CV, 1991 WL

404, at *6 (Tex. App.—Houston [14th Dist.] Jan. 3, 1991, writ denied) (not

designated for publication) (noting that without construction contract insurance

requirement page, court was unable to determine whether appellees conclusively

proved that insurance coverage met contract requirements as matter of law).

15

with yet other language in the provision that states warranties are specifically

included—except for any warranties in the Construction Contract which was not

before the trial court.7 And that is an interpretation we must avoid. Again, we

must give effect to all of the language so that none is rendered meaningless. See

J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 229 (Tex. 2003).

Based on all of these reasons, we conclude that A&A did not establish as a

matter of law that the Miscellaneous Property Assets provision in the PSC carves

out any claims or warranties against it.

2. Bill of Sale and Assignment

TL argues that it was assigned Property Contracts under the BOSA―which

includes the Stucco Contract and Stucco Warranty. The BOSA defines Property

Contracts as: “All of Assignor’s rights and interests in and to . . . service or utility

contracts and similar contracts, . . . which relate to the ownership, maintenance,

7

The Miscellaneous Property Assets provision of the PSC provides,

[B]ut specifically including all warranties and guaranties

(express or implied) (other than warranties and guaranties

contained in the Construction Contract) in connection with or

arising out of the design or construction of any the

Improvements or the performance of any of the work, under or

pursuant to the Construction Contract or otherwise, or issued in

connection with or arising out of the fabrication, purchase,

installation or repair of any fixtures, equipment or other

personal property attached to, located in or used in connection

with the Property. (Emphasis added).

16

construction or repair and/or operation of the Project, but only to the extent

transferable.”

A&A asserts that the phrase “service or utility contracts” should be narrowly

construed to mean “contracts to provide maintenance on a consumer product for a

specified term, such as a copy machine, an ice maker or some other similar

consumer product.” But, like A&A’s earlier argument, that disregards the rest of

the language in the definition which states, “and similar contracts, . . . which relate

to the ownership, maintenance, construction or repair and/or operation of the

Project, but only to the extent transferable.” See Hysaw, 483 S.W.3d at 13; J.M.

Davidson, 128 S.W.3d at 229. And A&A has not provided us with any argument

or authority as to why the Stucco Contract and Stucco Warranty are not “similar

contracts” relating to ownership, maintenance, construction or repair of the project.

Accordingly, we conclude that A&A did not establish as a matter of law that

the Stucco Agreement and Stucco Warranty are not “similar contracts . . . which

relate to the ownership, maintenance, construction or repair and/or operation of the

Project.”8

8

A&A states without authority that the Stucco Warranty was not transferable. But

A&A provides no authority for that proposition. Instead, Texas law provides that

contracts are freely assignable unless there is language in the contract to the

contrary. Because an express warranty sounds in contract, the same is true for an

express warranty―which we have here. See Vaughn v. DAP Fin. Servs., Inc., 982

S.W.2d 1, 7 (Tex. App.—Houston [1st Dist.] 1997, no pet.) (stating that “[unless

otherwise stipulated, all contracts are freely assignable.”); see also Med. City

17

Next, A&A primarily relies on Exxon Corp. v. Emerald Oil & Gas Company

for the proposition that TL, as a subsequent purchaser, lacked the right to sue

because the Egret Bay Sellers did not make an express assignment. See 331

S.W.3d 419 (Tex. 2010). In Emerald Oil, the Texas Supreme Court addressed

whether “section 85.321 of the Texas Natural Resources Code allows a subsequent

mineral lessee to maintain a cause of action against a prior lessee for damages to

the mineral interest that occurred prior to the time the subsequent lessee obtained

its interest.” Id. at 420.

Unlike Emerald Oil, TL was not a “mere subsequent purchaser.” Rather, TL

was assigned Miscellaneous Property Assets―including the Stucco Agreement

and the Stucco Warranty; in addition to Property Contracts as defined in the

BOSA.9 See Emerald Oil, 331 S.W.3d at 424.

Dall., Ltd. v. Carlisle Corp., 251 S.W.3d 55, 58 (Tex. 2008) (holding that “a claim

based on an express warranty is, in essence, a contract action”); Rollingwood Trust

No. 10 v. Schuhmann, 984 S.W.2d 312, 315 (Tex. App.—Austin 1998, no pet.)

(stating that in absence of contrary provision, contract may be assigned). A&A

does not point to any provision in the express Stucco Warranty, or in any related

contract, that precludes assignment of the express warranty.

9

A&A also relies on Ceramic Tile International, Inc. v. Balusek to support its

argument that TL was not an assignee. 137 S.W.3d 722, 724–25 (Tex. App.—San

Antonio 2004, no pet.). Balusek likewise does not support A&A’s argument

because in that case, the court found that the assignee never offered the assignment

in evidence during trial. Unlike Balusek, TL presented summary judgment

evidence of the assignment.

18

Therefore, for all of these reasons, we hold that the trial court erred in

granting summary judgment based on A&A’s contention that TL lacked capacity

to sue. We sustain TL’s first issue.10

Summary Judgment on TL’s Negligence Claim

A&A also argued in its summary judgment motion that an “as is” clause in

the PSC prevented TL from asserting any tort claims. Specifically, A&A

maintained that the PSC’s “as is” clause “negates the element of causation

necessary to recover on claims regarding the physical condition of the property”

and that the “as is” clause “bars [TL’s] ability to assert any tort cause of action

against A&A, regarding the condition of the Property, as a negligence claim

requires causation.”

In general, a valid “as is” agreement negates the element of causation

necessary to recover on claims regarding the physical condition of the property.

See Prudential Ins. Co. of Am. v. Jefferson Assocs., Ltd., 896 S.W.2d 156, 161

(Tex. 1995).11 By agreeing to purchase the property “as is,” the buyer agrees to

make his own assessment of the bargain and to accept the risk that he may be

10

Because we conclude that the trial court erred in granting A&A’s motion for

summary judgment in part, it is unnecessary for this Court to determine TL’s

second, third, and fourth issues. See TEX. R. APP. P. 47.1.

11

See Gym–N–I Playgrounds, Inc. v. Snider, 220 S.W.3d 905, 912 (Tex. 2007)

(holding that “as is” clause in commercial lease waives implied warranty of

suitability); Bynum v. Prudential Residential Servs., Ltd. P’ship, 129 S.W.3d 781,

788 (Tex. App.—Houston [1st Dist.] 2004, pet. denied) (applying “as is” clause in

sale agreement for remodeled home to bar claims relating to remodeling work).

19

wrong. Bynum, 129 S.W.3d at 788. The seller gives no assurances, express or

implied, concerning the value or condition of the thing sold, and the buyer chooses

to rely on his own determination of the value and condition of the purchase, thus

eliminating the possibility that the seller’s conduct will cause him damage. Id. The

Texas Supreme Court has instructed that an “as is” clause will generally defeat the

element of causation in DTPA, fraud, and negligence claims. Prudential, 896

S.W.2d at 161.

Here, TL had the summary judgment burden as the non-movant of adducing

more than a scintilla of evidence raising an issue of fact as to the enforceability of

the “as is” clause. See Bynum, 129 S.W.3d at 788–94; accord Santibanez v. Diron,

No. 01-16-00231-CV, 2017 WL 343609, at *3 (Tex. App.—Houston [1st Dist.]

Jan. 24, 2017, no pet.) (mem. op.). Instead, TL just broadly asserted that the “as

is” clause does not carve out any claims or causes of action against A&A. By

failing to present any argument below that the as-is clause was not enforceable

against its negligence claim, TL has not overcome its burden as a matter of law.

Accordingly, to the extent that the trial court granted summary judgment on

TL’s negligence claim, we hold that the trial court did not err.

20

Conclusion

Based on our review of the entire record and application of the governing

standard of review, we reverse the trial court’s granting of A&A’s Traditional

Motion for Summary Judgment on all claims―except for TL’s negligence claim

which we affirm only to that extent.

Because A&A did not establish that TL lacks capacity to sue as a matter of

law, we further reverse that portion of the trial court’s order on TL’s Motion for

Partial Summary Judgment Against Defendant A&A Masonry, Inc. on Liability

Only that dismissed all of TL’s claims—except for TL’s negligence claim, which

as stated above, we affirm only to that extent. We additionally remand for further

proceedings consistent with this opinion.

Terry Adams

Chief Justice

Panel consists of Chief Justice Adams and Justices Landau and Farris.

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