Philadelphia Indemnity Insurance Company, A/S/O Mirsan, L.P., D/B/A Sienna Ridge Apartments v. Carmen A. White , 490 S.W.3d 468 ( 2016 )

IN THE SUPREME COURT OF TEXAS
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NO . 14-0086
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PHILADELPHIA INDEMNITY INSURANCE COMPANY, A/S/O MIRSAN, L.P., D/B/A
SIENNA RIDGE APARTMENTS, PETITIONER,
v.
CARMEN A. WHITE, RESPONDENT
4444444444444444444444444444444444444444444444444444
ON PETITION FOR REVIEW FROM THE
COURT OF APPEALS FOR THE FOURTH DISTRICT OF TEXAS
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Argued October 13, 2015
JUSTICE GUZMAN delivered the opinion of the Court, in which CHIEF JUSTICE HECHT , JUSTICE
GREEN , JUSTICE JOHNSON , and JUSTICE BROWN joined.
JUSTICE BOYD filed a dissenting opinion, in which JUSTICE WILLETT , JUSTICE LEHRMANN ,
and JUSTICE DEVINE joined.
JUSTICE DEVINE filed a dissenting opinion.
Texas’s strong public policy favoring freedom of contract is firmly embedded in our
jurisprudence. Absent compelling reasons, courts must respect and enforce the terms of a contract
the parties have freely and voluntarily entered. See, e.g., Royston, Rayzor, Vickery, & Williams, LLP
v. Lopez, 467 S.W.3d 494, 503-04 (Tex. 2015); Fairfield Ins. Co. v. Stephens Martin Paving, LP, 246
S.W.3d 653, 664 (Tex. 2008); Wood Motor Co. v. Nebel, 238 S.W.2d 181, 185 (Tex. 1951). In the
residential-leasing context, privilege of contract is circumscribed by statute, but the restraint the
Legislature chose is limited and exceptions exist. See TEX . PROP . CODE §§ 92.006, .052; Churchill
Forge, Inc. v. Brown, 61 S.W.3d 368, 370, 373 (Tex. 2001) (observing that the Texas Property Code
restricts freedom of contract in residential tenancies). Today, we determine, as a matter of first
impression, whether public policy embodied in the Texas Property Code precludes enforcement of
a residential-lease provision imposing liability on a tenant for property losses resulting from “any
other cause not due to [the landlord’s] negligence or fault.”
At issue here is a tenant’s responsibility for property damage sustained in a fire that originated
in a tenant-owned clothes dryer stuffed with dry, unwashed bedding and pillows. A jury failed to find
the tenant negligent in causing the fire, but held the tenant contractually liable for the loss under the
terms of the lease agreement. The tenant filed a motion for judgment notwithstanding the verdict,
asserting several grounds for avoiding enforcement of the contract. The trial court granted the
tenant’s motion without stating the basis and rendered a take-nothing judgment. In a split decision,
the court of appeals affirmed, concluding the lease provision broadly and unambiguously shifts
liability for repairs beyond legislatively authorized bounds and is, therefore, void and unenforceable.
421 S.W.3d 252, 256, 258 (Tex. App.—San Antonio 2013).
Though we agree the lease language does not expressly incorporate statutory carve-outs, we
cannot say the contract is unenforceable on public-policy grounds because (1) the disputed lease
provision can be enforced without contravening the Property Code and (2) the record here does not
conclusively establish the factual predicate necessary to preclude its enforcement. We therefore
affirm the court of appeals’ judgment as to ambiguity, but reverse in part and render judgment that,
on the record before the Court, the lease provision is not void and unenforceable. Because the court
of appeals did not address the tenant’s other defenses to enforcement, we remand the case to that
court for further proceedings.
2
I. FACTUAL AND PROCEDURAL BACKGROUND
Carmen White executed a Texas Apartment Association (TAA) form lease in which she
agreed to reimburse her landlord for all property losses not resulting from the landlord’s negligence
or fault (the Reimbursement Provision). Section 12 of the lease provides, in pertinent part:
DAMAGES AND REIMBURSEMENT. You must promptly pay or reimburse us
for loss, damage, consequential damages, government fines or charges, or cost of
repairs or service in the apartment community due to: a violation of the Lease
Contract or rules; improper use; negligence; other conduct by you or your invitees,
guests or occupants; or any other cause not due to [the landlord’s] negligence or
fault. You will indemnify and hold us harmless from all liability arising from the
conduct of you, your invitees, guests, or occupants, or our representatives who
perform at your request services not contemplated in this Lease Contract. Unless the
damage or wastewater stoppage is due to our negligence, we’re not liable
for–and you must pay for–repairs, replacements and damage to the following if
occurring during the Lease Contract term or renewal period: (1) damage to
doors, windows, or screens; (2) damage from windows or doors left open; and
(3) damage from wastewater stoppages caused by improper objects in lines
exclusively serving your apartment.
(First emphasis added.)
Shortly after White moved into her apartment, she received a new washer and dryer as a gift
from her parents. She successfully connected the washer, but abandoned her efforts to install the
dryer because the cord sparked and the circuit breaker tripped when she attempted to plug it into the
receptacle. At White’s request, an apartment-complex employee later connected the dryer to the
unit’s pre-existing utility connections via a cord White supplied.
Within days of the dryer’s installation, White’s apartment and several adjoining units were
severely damaged in a fire that originated in her apartment. White first detected the fire in the clothes
dryer, which she had been using to remove allergens from dry and unwashed items, including a duvet,
3
sheets, a blanket, decorative pillows, and a bed pillow. Though the fire started in the dryer drum, the
source of ignition is unknown. White was unable to extinguish the fire, and the ensuing casualty loss
exceeded $83,000.
Philadelphia Indemnity Insurance Co. paid the landlord’s insurance claim and demanded
reimbursement from White. White failed to remit payment, and Philadelphia Indemnity sued her for
negligence and breach of contract for noncompliance with the Reimbursement Provision.
At trial, mechanical and electrical malfunction of the dryer, cords, power outlet, and circuit
breaker were excluded as causes by a testifying expert. But the parties disputed whether some of the
items placed in the dryer contained materials not suitable for mechanical drying, and a chemist
testified that a sample of the dryer contents “consisted of cotton fibers, [was] negative for ignitable
liquids, and contain[ed] 0.1 percent hexane extractible material by weight and contain[ed] the residue
of a vegetable oil.” The dryer’s instruction manual warns: “Do not place items exposed to cooking
oils in your dryer. Items contaminated with cooking oils may contribute to a chemical reaction that
could cause a clothes load to catch fire.”
Following the close of evidence, the following broad-form liability questions were submitted
in the jury charge:
Question No. 1: Did the negligence, if any, of [White] proximately cause damages to
the Sienna Ridge Apartments.
Question No. 2: Did [White] violate the terms of the Apartment Lease Contract . . . .
Neither party requested a question to determine the fire’s cause or whether it was attributable to non-
negligent conduct on White’s part.
4
The jury answered “no” to the first question, failing to find that White’s negligence
proximately caused the fire. In answering “yes” to the second question, the jury found White
breached the lease agreement by failing to pay for the casualty loss and, in doing so, necessarily found
the landlord did not negligently cause the fire. Based on the affirmative finding that White breached
the lease agreement, the jury awarded $93,498 in actual damages and attorney’s fees to Philadelphia
Indemnity.
White moved for judgment notwithstanding the verdict, asserting a variety of grounds for
avoiding enforcement of the Reimbursement Provision, including ambiguity and public policy.1 The
trial court granted the motion without specifying the grounds and rendered a take-nothing judgment.
A divided court of appeals affirmed, rejecting White’s ambiguity defense, but holding the
Reimbursement Provision void as against public policy. 421 S.W.3d at 256, 258. In declining to
enforce the parties’ bargain, the majority found a fatal conflict between the Reimbursement
Provision’s broad language and Property Code provisions delineating particular circumstances under
which landlords owning more than one rental dwelling and their tenants may contractually allocate
repair responsibilities. See id. at 257-58 (citing TEX . PROP. CODE §§ 92.006, 92.052(b) and Churchill
Forge, 61 S.W.3d at 370-73). The court declared the Reimbursement Provision void because it
plainly “makes a tenant liable for damage to the entire apartment complex for accidental losses, acts
of God, criminal acts of another, or any other act of someone or something unassociated with the
tenant or [landlord],” id. at 256, whereas the Property Code prohibits landlords from waiving their
1
The other grounds included lack of consideration, unconscionability, violation of the fair-notice doctrine, and
improper establishment of a new strict-liability theory.
5
repair duties under subchapter B, which covers conditions materially affecting the physical health or
safety of the ordinary tenant, except for:
(1) conditions caused by the tenant or an affiliated party;2
(2) three specific categories of repairs set forth in section 92.006(f), subject to
specificity, conspicuity, and other prerequisites; and
(3) any condition covered by subchapter B if the landlord owns only one rental
dwelling at the beginning of the lease term and specificity, conspicuity, and
other prerequisites are satisfied.
Id. at 258 & n.3 (citing TEX . PROP. CODE §§ 92.006(c)-(f), .052(b) and Churchill Forge, 61 S.W.3d
at 373). Because the third category is inapplicable to the present dispute, the court of appeals
observed that the Legislature has not sanctioned “the imposition of contractual liability on a tenant
for any and all damages to the apartment complex whenever the damages are not caused by the
landlord.” 421 S.W.3d at 258. Because the Reimbursement Provision encompasses scenarios in
which the Legislature has not expressly authorized a landlord to contractually shift repair
responsibility to a tenant, the court determined the lease provision is incompatible with public policy
reflected in the Property Code. Id. The court also summarily determined that the damages at issue
were not tenant-caused based on the jury’s failure to find White’s negligence proximately caused
damages to the apartment complex. Id. at 258 & n.4.
In a dissenting opinion, Justice Barnard addressed each of White’s challenges to contract
enforcement and concluded that none had merit. Id. at 259-63 & n.2. With regard to public policy,
2
In this opinion, references to tenant cause include conditions caused by a lawful occupant in the tenant’s
dwelling, a member of the tenant’s family, or a guest or invitee of the tenant. See T EX . P RO P . C O DE § 92.052(b).
6
Justice Barnard construed our opinion in Churchill Forge as repudiating any notion that contractual
liberty is constrained to tenant-caused damages and those circumstances specifically enumerated in
the Property Code. Id. at 260 (citing Churchill Forge, 61 S.W.3d at 371).
On appeal to this Court, the parties focus their attention on White’s ambiguity and public-
policy defenses to contract enforcement.3 The crux of the public-policy argument concerns the
relationship between section 92.006(c) of the Property Code, which generally prohibits waiver of
statutory repair duties and remedies, and section 92.052, which delineates the landlord’s duty to
repair or remedy conditions materially affecting the physical health or safety of an ordinary tenant.
In Churchill Forge, we held: (1) Section 92.006(c) does not restrict freedom of contract unless the
landlord has a duty to repair, and (2) under section 92.052(b) a landlord has no duty to repair
conditions “caused by” the tenant. Churchill Forge, 61 S.W.3d at 371-72 (citing TEX . PROP . CODE
§§ 92.006(c), .052(b)). If the landlord has a repair duty and section 92.006(c) is therefore implicated,
section 92.006(d)-(f) describes permissive contractual arrangements excluded from the general
prohibition. The parties agree that none of the permissive exceptions to section 92.006(c) apply in
this case. The main points of disagreement are (1) what White must prove to establish the landlord’s
repair duty as a predicate to invoking the statutory prohibition that undergirds her affirmative defense,
and (2) whether the permissive exceptions to the general prohibition are exclusive.
Citing our opinion in Churchill Forge, Philadelphia Indemnity argues section 92.006’s list
of authorized contractual arrangements is permissive, but not exclusive, and the Property Code
neither prohibits agreements making tenants responsible for damages accidentally caused by their
3
The parties also touch on W hite’s other contract-avoidance defenses, but the court of appeals did not consider
those issues, and we decline the invitation to address them at this time.
7
own appliances nor requires tenant fault to shift responsibility for tenant-caused damages. See 61
S.W.3d at 371 (stating, when discussing section 92.006, that “[l]egislative permission to contract
under certain circumstances does not necessarily imply that contracting under other circumstances
is prohibited”). Even if the permissible arrangements identified in section 92.006(d)-(f) are
exclusive, Philadelphia Indemnity contends White did not prove the anti-waiver provision in section
92.006(c) applies because (1) White bears the burden of establishing the contract’s invalidity as an
affirmative defense, (2) damages caused by a tenant’s appliances are “caused by” the tenant within
the meaning of section 92.052(b), and (3) White failed to obtain a jury finding on an alternative cause
of the fire. See id. at 372-73 (agreements between parties concerning tenant-caused damages are
excluded from section 92.006(c)’s non-waiver prohibition); see also TEX . PROP . CODE § 92.052(b)
(“[T]he landlord does not have a duty . . . to repair or remedy a condition caused by [the tenant or an
affiliated party].”); cf. McAnally v. Person, 57 S.W.2d 945, 949 (Tex. Civ. App.—Galveston 1933,
writ ref’d) (party seeking to avoid liability under agreement has the burden to plead and prove facts
making it unlawful, unless the agreement is facially invalid).
White’s primary complaint is that the Reimbursement Provision broadly imposes no-fault
liability without requiring any causal nexus. White distinguishes our opinion in Churchill Forge as
involving a materially different contract provision that was expressly limited to damages negligently
caused by the tenant. White also cites Churchill Forge as affirming that a landlord seeking to avoid
the waiver proscription in section 92.006(c) bears the burden of establishing the tenant caused the
damage. See Churchill Forge, 61 S.W.3d at 372 (“Without showing that the damage was caused by
the tenant, the landlord would otherwise have a duty to bear the cost of repair[ing] [the specific
conditions described in 92.006(f)] . . . [a]nd under 92.006(c), that duty could not be waived.”). White
8
therefore argues that absent proof of fault on the tenant’s part, the landlord has a duty to repair any
damages the tenant caused. Because the jury answered the negligence question in White’s favor, she
asserts her landlord bore a non-waivable duty to repair the premises condition under section
92.006(c).
We granted Philadelphia Indemnity’s petition for review to address these important matters
because the Reimbursement Provision is part of a TAA-approved form lease agreement used in
countless rental arrangements throughout the state.4 Several amici5 have also weighed in on the
controversy, highlighting the potential impact on residential leasing.
II. DISCUSSION
As a general rule, parties in Texas may contract as they wish so long as the agreement reached
does not violate positive law or offend public policy. In re Prudential Ins. Co. of Am., 148 S.W.3d
124, 129 (Tex. 2004). In the residential-leasing context, the Legislature has limited the freedom of
landlord and tenant to contractually allocate responsibility for repairs materially affecting health and
safety but, importantly, has decided as a matter of public policy not to impose a categorical
prohibition on such contracts. See TEX . PROP . CODE §§ 92.006 (limitations on waiver or expansion
of duties and remedies), .061 (statutory repair duties and remedies under subchapter B of the Property
Code are in lieu of other common-law and statutory warranties, landlord duties, and tenant remedies);
see also Churchill Forge, 61 S.W.3d at 370, 372-73 (“[s]tatutory limitations on the freedom of
landlord and tenant to contract are contained in . . . section 92.006 [of the Property Code],” but not
4
Above the signature block, the lease prominently states that the lease can be modified by agreement of the
parties, but neither party requested modifications to the Reimbursement Provision’s terms.
5
The Texas Apartment Association, the Texas Tenants’ Union, and Southern Methodist University’s Civil Legal
Services Clinic.
9
all responsibility-shifting arrangements are prohibited); see also Fairfield Ins., 246 S.W.3d at 665
(“The Legislature determines public policy through the statutes it passes.”). Recognizing the Property
Code’s statutory limitations, we explained in Churchill Forge that a landlord owning more than one
rental dwelling “cannot ask a tenant to pay for repairs that the landlord has the duty to make,” but
(1) “[e]xcepted from that dictate . . . are three specific kinds of repairs that the parties can, by
contract, shift the duty to pay for from the landlord to the tenant” and (2) “not covered by that dictate
are those agreements between the parties concerning damages for which the landlord has no duty to
repair, i.e., tenant-caused damages.” 61 S.W.3d at 373. Applying this framework, we held that a
contract specifically allocating the risk of tenant-caused damages to the tenant did not violate public
policy even though the Property Code did not overtly authorize such an agreement. Id.
Unlike the lease provision in Churchill Forge, however, section 12 of White’s rental
agreement is not limited to tenant-caused damages, but by negative reference assigns responsibility
to her for all damage not caused by the landlord’s negligence or fault. Distinguishing Churchill
Forge, the court of appeals held that the Reimbursement Provision is adverse to public policy
expressed in the Property Code because (1) the provision is unambiguous and not explicitly limited
to either the exception or the exclusion noted in Churchill Forge; (2) the provision’s broad language
permits tenant-liability scenarios not specifically authorized in the Property Code; and (3) the jury
determined the damages at issue were not proximately caused by White’s negligence. 421 S.W.3d
at 256, 257-58.
The dispute between White and Philadelphia Indemnity ultimately centers on the Property
Code’s express allocation of the repair duty between landlords and tenants and the liberty to strike
a different bargain. We define the overarching issues as (1) whether section 12 of White’s lease
10
agreement unambiguously imposes liability for the disputed damages; (2) if so, whether the
agreement runs afoul of public policy embodied in the Property Code;6 and (3) whether the jury’s
failure to find that White’s negligence proximately caused the property damage affects the
disposition.
The public-policy and ambiguity analyses are interrelated because we must ascertain the
contract’s meaning before we can determine whether it conflicts with the Property Code. Our initial
inquiry, therefore, is whether the lease provision clearly and unambiguously shifts responsibility to
White for the damages at issue. See Fairfield Ins., 246 S.W.3d at 655 (first step in determining
whether public policy precludes subject matter of a contract involves ascertaining the contract’s
scope). We then consider whether the statutory provisions governing the landlord-tenant relationship
embody a legislative policy prohibiting the landlord from contracting with White to shift
responsibility for the casualty loss at issue in this case. Id. (second step in public-policy analysis
requires consideration of explicit legislative policy decisions and, in the absence of such,
consideration of the general public policies of Texas); see also TEX . PROP . CODE § 92.061 (statutory
duties and remedies under subchapter B are in lieu of other common-law duties and remedies but do
not otherwise affect rights under other laws that are not inconsistent with statutory purposes).
6
W hether characterized as a matter of contract illegality, as the dissenting justices assert, or a matter of public
policy, as presented by the parties and determined by the court of appeals, the question is whether the Texas Property
Code, expressly or implicitly, prohibits the parties’ cost-shifting agreement. If either, the agreement contravenes public
policy. See Fairfield Ins. Co. v. Stephens Martin Paving, LP, 246 S.W .3d 663, 665 (Tex. 2008) (recognizing that
agreements the Legislature has declared illegal are against public policy).
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A. Ambiguity
A contract is ambiguous if it is subject to two or more reasonable interpretations. Am. Mfrs.
Mut. Ins. Co. v. Schaefer, 124 S.W.3d 154, 157 (Tex. 2003). But when a contract provision is
worded so that it can be assigned a definite meaning, no ambiguity exists, and we construe the
contract as a matter of law. Id.
Although the language in the Reimbursement Provision is clear and definite, White points to
an apparent redundancy she contends creates ambiguity as to the provision’s actual scope. White
finds equivocality in the juxtaposition of a clause imposing broad, nonspecific liability with a clause
that identifies specific categories of losses for which the tenant is liable without regard to fault or
causation.
On one hand, the Reimbursement Provision distinctly imposes responsibility for (1) damage
to doors, windows, or screens, (2) damage from windows or doors left open, and (3) damage from
wastewater stoppages caused by improper objects, unless the damage or wastewater stoppage is due
to the landlord’s negligence.7 On the other hand, the provision includes “catchall” language capturing
losses resulting from “any cause not due to [the landlord’s] negligence or fault.” White thus
questions why the contract singles out specific losses for reimbursement absent landlord fault if the
catchall language makes the tenant responsible for all loss in the same circumstances. White also
points out that specific losses are emphasized by language that is both bolded and underlined, while
7
This portion of the Reimbursement Provision generally tracks section 92.006(f) of the Property Code, which
permits a landlord to shift to the tenant the cost of remedying specific conditions even if those conditions are not caused
by the tenant or an affiliated party. See T EX . P RO P . C O D E § 92.006(f) (a permissive exception to section 92.006(c)’s
general prohibition against waiver of the landlord’s repair duties and tenant’s remedies); Churchill Forge, Inc. v. Brown,
61 S.W .3d 368, 372 (Tex. 2001) (observing that the specific conditions “resemble those tenant-caused conditions which
a landlord [otherwise] has no [statutory] duty to repair, or pay to repair”).
12
the ostensibly broader catchall language—which would subsume the specific losses—is less
conspicuously presented. White discerns ambiguity in the catchall language’s meaning, arguing it
potentially imposes significant liability on tenants while receiving relatively obscure treatment in
relation to a more specific subclass of repairs.
Though we strive to construe contracts in a manner that avoids rendering any language
superfluous, redundancies may be used for clarity, emphasis, or both. Cf. In re Estate of Nash, 220
S.W.3d 914, 917-18 (Tex. 2007) (“[W]e should avoid, when possible, treating statutory language as
surplusage, [but] there are times when redundancies are precisely what the Legislature intended.”
(internal citation omitted)). All things considered, we cannot discern any construction of the catchall
provision other than the one it so plainly commands: White is contractually obligated to reimburse
the landlord for all damage not due to the landlord’s negligence or fault. We therefore agree with the
court of appeals that the Reimbursement Provision is unambiguous.
We turn now to the principal issue, which is whether the Property Code precludes judicial
enforcement of the Reimbursement Provision. We begin our analysis with a brief discussion of the
common-law backdrop against which the Property Code exists, which provides meaningful context.
B. No Common-Law Prohibition Against Covenants Imposing
Tenant Liability for Repairs without Regard to Fault or Negligence
As part of a historically agrarian society, the relationship between a landlord and tenant was,
at its most basic level, a tenant’s promise to pay in exchange for the bare right to possess the property.
Kamarath v. Bennett, 568 S.W.2d 658, 660 (Tex. 1978), superseded by statute, Act of May 28, 1979,
66th Leg., R.S. ch. 780, §§ 1–18, 1979 Tex. Gen. Laws 1978, as recognized in Daitch v. Mid-Am.
Apartment Comtys., Inc., 250 S.W.3d 191, 195 (Tex. App.—Dallas 2008, no pet.). At common law,
13
caveat emptor controlled the landlord-tenant relationship, ensuring that no warranty of habitability
was implied upon leasing of the premises. 5 THOMPSON ON REAL PROPERTY § 41.04(a)(1), at 169-70
(David A. Thomas, N. Gregory Smith eds., 2d Thomas ed. 2007); Yarbrough v. Booher, 174 S.W.2d
47, 48 (Tex. 1943). Without an implied warranty of habitability or specific lease language to the
contrary, a landlord had no obligation during the term of the lease to maintain or repair the premises.
5 THOMPSON ON REAL PROPERTY § 41.04(b), at 172. Rather, it was the tenant’s duty to make
ordinary repairs. Halsell v. Scurr, 297 S.W. 524, 529 (Tex. Civ. App.—Fort Worth 1927, writ
dism’d w.o.j.).
Consistent with this notion, leases commonly included a covenant to return possession of the
premises in as good a condition as when delivered, excepting wear and tear. See Miller, Billups &
Co. v. Morris, Ragsdale & Simpson, 55 Tex. 412, 419 (1881); Howeth v. Anderson, 25 Tex. 557, 572
(1860); Publix Theatres Corp. v. Powell, 71 S.W.2d 237, 238 (Tex. 1934). A covenant of this type
required the tenant to use his best efforts to keep the premises in the same state as he found them.
Howeth, 25 Tex. at 572. In the event of an accidental fire, however, such a covenant did not impose
liability on the tenant or require him to rebuild the structures destroyed unless the tenant had
expressly agreed “to restore edifices and structures destroyed by casualty, or some other covenant
which is equivalent thereto, such as a covenant ‘to uphold and repair,’ or ‘to repair,’ . . . .” Miller,
Billups & Co., 55 Tex. at 421-22. A covenant that merely required the tenant “to redeliver or restore
to the lessor, in the same plight and condition, usual wear and tear excepted” could not fairly or
reasonably be construed to impose the burden of accidental casualty loss on the tenant. Id. at 422;
Howeth, 25 Tex. at 573 (“Looking to the terms and subject matter of the contract, we do not think
it reasonable or fair to conclude that the parties contemplated that the lessors were to become insurers
14
of the property against those casualties which ordinary prudence and foresight could not have guarded
against.”). But an express covenant “to uphold and repair” or “to repair” obligated the tenant to make
good all losses during the tenancy. See Miller, Billups & Co., 55 Tex. at 422; Howeth, 25 Tex. at 573
(“When a tenant is under an express covenant to uphold and repair the premises, he is liable to make
good all losses, and must even rebuild in case of casualty by fire or otherwise. . . . [I]f he covenants
to repair generally, this will impose on him a liability to uphold the buildings, without regard to
accidents or the necessary decay of the old materials.” (quoting Taylor, L. & T. American Law of
Landlord and Tenant § 357)); Warner v. Hitchins, 5 Barb. 666, 668 (N.Y. Gen. Term 1849) (“It is
. . . settled, that when the lease contains, on the part of the lessee, an express covenant to uphold and
repair the premises, he is liable to make good such losses [caused by accidental fire].”). Under the
common law, therefore, landlord and tenant were free to negotiate the tenant’s responsibility for
accidental destruction of property by fire.
Though the landlord-tenant relationship had historically centered on possession, over time
tenants became increasingly concerned with the condition and habitability of the rented premises.
Kamarath, 568 S.W.2d at 660. In part, this stemmed from the average residential tenant’s inability
to make repairs to complex mechanical and electrical components of the modern home. 5 THOMPSON
ON REAL PROPERTY § 41.05(a), at 175. Correspondingly, many courts and state legislatures took
action to modify the common law, which had traditionally allocated the duty to perform ordinary
repairs to the tenant. Id. In particular, this Court abrogated Texas common law by finding an implied
warranty of habitability in Kamarath v. Bennett, 568 S.W.2d at 661. Shortly after Kamarath was
decided, superseding legislation was enacted that “abrogat[ed] the implied warranty and creat[ed] a
limited landlord duty to repair.” Daitch, 250 S.W.3d at 195.
15
In its current iteration, the Texas Property Code provides:
The duties of a landlord and the remedies of a tenant under [subchapter B, which
governs repairs of a leasehold,] are in lieu of existing common law and other statutory
[landlord and tenant duties and remedies]. Otherwise, this subchapter does not affect
any other right of a landlord or tenant under contract, statutory law, or common law
that is consistent with the purposes of this subchapter . . . . This subchapter does not
impose obligations on a landlord or tenant other than those expressly stated in this
subchapter.
TEX . PROP . CODE § 92.061. Thus, to the extent the Property Code imposes limitations on contracting
in the leasehold-repair context, the Property Code reflects the Legislature’s public-policy
determinations on the matter. See Churchill Forge, 61 S.W.3d at 370 (acknowledging that Chapter
92 of the Texas Property Code limits freedom of landlord and tenant to contract).
C. Freedom to Shift Repair Obligations is Restricted
The current version of the Property Code deviates in certain respects from common law
landlord-tenant duties and remedies, but all rights not inconsistent with the statute remain intact. See
TEX . PROP . CODE § 92.061. As such, the Property Code imposes no barrier to contract beyond those
deriving from its terms. See Churchill Forge, 61 S.W.3d at 374 (Property Code’s contract restraints
are “activated” only when the landlord has a statutory repair duty). To determine whether the
contract provision at issue is void as against public policy, we first consider the legislatively imposed
restraints on liberty of contract in the landlord-tenant relationship. We begin our discussion with
those considerations, because it is up to the Legislature, not the courts, to decide what the policy of
this state should be in the landlord-tenant context.
With respect to freedom of contract, the Legislature plainly identified the prohibition it
intended to enforce in section 92.006(c):
16
A landlord’s duties and the tenant’s remedies under Subchapter B, which covers
conditions materially affecting the physical health or safety of the ordinary tenant,
may not be waived except as provided in Subsections (d), (e), and (f) of this section.
TEX . PROP . CODE § 92.006(c); Churchill Forge, 61 S.W.3d at 371. As the statute articulates, and as
we affirmed in Churchill Forge, a landlord cannot contractually avoid a repair obligation except
when statutorily authorized. The landlord, however, does not have a statutory duty to repair all
conditions that may arise in a tenancy.
With regard to habitability, the landlord’s limited duty to repair or remedy is addressed in
section 92.052 of the Property Code. After receiving proper notice from a tenant in good standing,
a landlord must make a diligent effort to repair or remedy only those conditions (1) materially
affecting the tenant’s physical health or safety or (2) involving proper operation of a water heater.
TEX . PROP . CODE § 92.052(a). Even then, the landlord’s obligation to make such repairs is not
absolute. To the contrary:
Unless the condition was caused by normal wear and tear, the landlord does not have
a duty . . . to repair or remedy a condition caused by:
(1) the tenant;
(2) a lawful occupant in the tenant’s dwelling;
(3) a member of the tenant’s family; or
(4) a guest or invitee of the tenant.
Id. § 92.052(b). Section 92.052(b) does not include fault-based language, and the causal standard is
not specified.
As we explained in Churchill Forge, the legislatively imposed restriction on freedom of
contract provided in section 92.006(c) is triggered only when the landlord has a duty under section
17
92.052. See Churchill Forge, 61 S.W.3d at 373. When section 92.006(c)’s general prohibition is
“activated,” the statutory exceptions to the prohibition come into play. Id. at 374. The first exception
permits delegation of the landlord’s repair duty to the tenant but not cost-shifting. TEX . PROP . CODE
§ 92.006(d) (landlord and tenant may agree for the tenant to repair any condition covered by
subchapter B at the landlord’s expense); accord id. § 92.0561(g) (landlord’s repair duty may not be
waived except as provided in section 92.006(e)-(f) but parties may agree for the tenant to repair at
the landlord’s expense). The second permits the shifting of both the duty and cost of repair to the
tenant for any type of condition affecting habitability, subject to stated conditions that include
specificity and conspicuity requirements. Id. § 92.006(e). That exception, however, only applies to
landlords who own no more than one rental dwelling at the beginning of the lease term. Id. The only
statutory exception to nonwaivability that permits cost-shifting and applies to the landlord-tenant
relationship in this case is section 92.006(f):
(f) A landlord and tenant may agree that, except for those conditions caused by the
negligence of the landlord, the tenant has the duty to pay for repair of the following
conditions that may occur during the lease term or a renewal or extension:
(1) damage from wastewater stoppages caused by foreign or improper objects
in lines that exclusively serve the tenant’s dwelling;
(2) damage to doors, windows, or screens; and
(3) damage from windows or doors left open.
This subsection shall not affect the landlord’s duty under Subchapter B [i.e., section
92.052] to repair or remedy, at the landlord’s expense, wastewater stoppages or
backups caused by deterioration, breakage, roots, ground conditions, faulty
construction, or malfunctioning equipment. A landlord and tenant may agree to the
provisions of this subsection only if the agreement meets the [clear, specific, and
conspicuous writing] requirements of Subdivision (4) of Subsection (e) of this
section.
18
Id. § 92.006(f). Section 92.006(f) “specifically authorizes the parties to shift by contract costs of
repairs for certain damages from the landlord to the tenant irrespective of whether the damage was
caused by the tenant.” Churchill Forge, 61 S.W.3d at 372-73.
The facts of this case do not fall within subsection (f)’s exception to subsection (c)’s anti-
waiver rule, and on its face, the catchall language in the Reimbursement Provision is not limited to
those conditions. See id. § 92.006(c), (f). White thus asserts that the lease, on its face and as applied,
is repugnant to the statute because the Reimbursement Provision applies when the landlord has a
repair duty and when none of the exceptions to subsection (c) apply.
Philadelphia Indemnity takes a different view, asserting that White failed to carry her burden
of establishing the lease agreement conflicts with section 92.006(c) (i.e., that the landlord bears a
nonwaivable duty to repair the fire damage) and arguing that the contract would be permitted even
if section 92.006(c) applies. As to the latter point, Philadelphia Indemnity reads Churchill Forge as
countenancing any contractual arrangement not expressly prohibited by the Property Code rather than
limiting freedom of contract to the permissive arrangements authorized in section 92.006(d), (e), and
(f). See Churchill Forge, 61 S.W.3d at 371 (“Legislative permission to contract under certain
circumstances does not necessarily imply that contracting under other circumstances is prohibited.
Certainly, given this State’s strong commitment to the principle of contractual freedom, we should
hesitate to infer a general prohibition from a statutory clause granting specific permission to
contract.”). Thus, even if 92.006(c) applies, Philadelphia Indemnity contends the statutory exceptions
are not exclusive.
19
Philadelphia Indemnity misconstrues the limited holding in Churchill Forge, in which we
considered a contract provision “not covered by” section 92.006(c)’s waiver prohibition. When
section 92.006(c) applies, however, the exceptions are permissive, but they are also exclusive.
In Churchill Forge, we considered the public-policy impact of the pertinent Property Code
provisions under similar facts, but a materially different contractual arrangement. 61 S.W.3d at 369-
70. In that case, an apartment complex had been damaged in a fire allegedly caused by a tenant’s
negligence or improper use. Id. at 369. Based on a reimbursement provision in the rental agreement
that was considerably more narrow than the one in White’s lease, the landlord sought reimbursement
of repair costs from the tenant’s mother, who had co-signed the lease. Id. at 369-70. Like White’s
lease, the Churchill Forge lease included language expressly requiring the tenant to reimburse the
landlord for the damages identified in section 92.006(f) unless the damage or the necessity of repair
resulted from the landlord’s negligence. Id. at 370. But unlike White’s lease, the “catchall” language
in the tenant’s lease imposed liability only for damages caused by the tenant or an affiliated party’s
improper use or negligence. Id. (“You must promptly reimburse us for loss, damage, or cost of
repairs or service caused anywhere in the apartment community by your or any guest’s or occupant’s
improper use or negligence.”). The primary issue was whether the catchall language in the lease
provision was unenforceable by statute or under the common law. Id. at 369.
Although acknowledging that section 92.006(c) restricts freedom of contract, we observed
that (1) the waiver prohibition applies only if the landlord has a duty or the tenant has a remedy under
subchapter B, (2) under section 92.052, landlords have no duty to bear the cost of repairing tenant-
caused damages, and (3) under sections 92.056 and 92.0561, the tenant’s remedies “are conditioned
upon the existence of a duty under Subchapter B.” Id. at 370-72 (citing sections 92.056(a), (e) and
20
92.0561(d), which condition the tenant’s remedies on the landlord’s liability for the repair and
condition the landlord’s liability on the existence of a duty under section 92.052(b)). Because
subchapter B “imposes no duty on [the landlord] to bear the cost of repairing damage allegedly
caused by [the tenant],” we held that neither section 92.006(c) nor its permissive exceptions “restrict
the parties’ freedom to contract as they wish concerning [tenant-caused damages].” See id. at 371-72
(“[B]ecause under Subchapter B landlords have no duty to repair or pay to repair tenant-caused
damage, and tenants have no remedy for such damage, section 92.061 makes clear that the Legislature
did not intend the Subchapter to otherwise affect the parties’ presumptive right to contract over who
would be responsible for conditions caused by the tenant, the tenant’s occupant, or guest.”).
The lease provision in Churchill Forge did not conflict with section 92.006(c) because,
consistent with section 92.052(b), the lease expressly limited the tenant’s reimbursement obligation
to damages caused by or statutorily imputed to the tenant. In fact, the lease provision was more
narrowly worded than section 92.052(b) by incorporating a fault-based requirement. Though not
deciding whether the tenant was actually negligent, or whether he had actually caused the fire, we
determined there was no public-policy bar—either under the Property Code or at common law—to
contractually allocating responsibility for repair costs negligently or intentionally caused by the tenant
or a cotenant. Id. at 370, 373 (“Public policy does not restrict a landlord and tenant from agreeing
that the tenant will be responsible for damages the tenant or cotenant causes.”).
We discussed the interplay of duty, cause, and contractual risk allocation as follows:
21
Taken together, [sections 92.006(c) and its exceptions] dictate that a commercial
landlord [i.e. one who owns more than one residential rental dwelling] cannot ask a
tenant to pay for repairs that the landlord has the duty to make. Excepted from that
dictate is subsection (f), under which there are three specific kinds of repairs that the
parties can, by contract, shift the duty to pay for from the landlord to the tenant. . . .
And not covered by that dictate are those agreements between the parties concerning
damages for which the landlord has no duty to repair, i.e., tenant-caused damages.
Id. at 373. A contract allocating responsibility for damages negligently or intentionally “caused by”
the tenant, the tenant’s occupant, or guest thus did no violence to public policy. Id. And even though
Churchill Forge involved a casualty loss, we observed that the Property Code does not distinguish
between casualty losses and other conditions in determining whether a landlord has a duty to repair.
Id.
As Churchill Forge instructs, public policy does not prohibit landlords and tenants from
agreeing that the tenant will be responsible for tenant-caused or tenant-imputed damages because,
in those circumstances, the landlord has no duty to make (or fund) repairs and the tenant has no
remedy under Subchapter B. See TEX . PROP . CODE §§ 92.052(b), .056(a), (b), (e), .0561(a), (d).
When a duty exists, however, it cannot be shifted to the tenant except as specifically authorized by
statute. See id. § 92.006(c) (no waiver of duties or remedies except under subsections (d), (e), or (f)).
When considered in context, isolated language employed in Churchill Forge and relied on by
Philadelphia Indemnity does not suggest the contrary.
With regard to the Reimbursement Provision in White’s lease, broad notions of public policy
ultimately reduce to whether enforcement of the reimbursement provision would require White to
pay for damages that were not tenant-caused and that the landlord, therefore, had a nonwaivable duty
to make. We acknowledge that, on its face, the Reimbursement Provision lends itself to such an
22
application, but mere potential for an impermissible application cannot be dispositive of the public-
policy inquiry.
D. The Reimbursement Provision is Not Unenforceable Per Se
“‘A contract to do a thing which cannot be performed without violation of the law’ violates
public policy and is void.” In re Kasschau, 11 S.W.3d 305, 312 (Tex. App.—Houston [14th Dist.]
1999, orig. proceeding) (quoting Lewis v. Davis, 199 S.W.2d 146, 148-49 (Tex. 1947)). However,
a contract will not be declared void merely because it could have been performed illegally or contrary
to public policy. Lewis, 199 S.W.2d at 149 (“A contract that could have been performed in a legal
manner will not be declared void because it may have been performed in an illegal manner.”); see,
e.g., Wade v. Jones, 526 S.W.2d 160, 163 (Tex. App.—Dallas 1975, no writ). “[P]arties are
presumed to know the law, and are likewise presumed to intend that their agreement shall have legal
effect.” Tex. Emp’rs Ins. Ass’n v. Tabor, 283 S.W. 779, 780 (Tex. Comm’n App. 1926, judgm’t
adopted).
The Reimbursement Provision in White’s rental agreement is overly broad in the sense that
it does not expressly carve out any exceptions other than landlord negligence and, therefore, is
susceptible to overreaching in its application by encompassing reimbursement scenarios in which a
landlord would have a nonwaivable duty to repair under chapter 92 of the Property Code. But this
circumstance is not fatal to enforcement. The provision would be unenforceable per se only if it
could not be performed without violating the Property Code. Here, that is simply not the case. For
instance, if White’s landlord were seeking reimbursement for remediating a tenant-caused condition
or a condition not materially affecting habitability, the cost-shifting limitations in section 92.006(c)-
(f) would not be implicated and performance of the contract would not contravene the statute.
23
Appealing as it might seem to automatically invalidate broadly worded contract provisions,
doing so necessarily imperils freedom of contract and, in the residential-leasing context, deprives the
Legislature of its role as the policy-making body.8 Rather, such an approach substitutes the policy
views of individual judges for those of the Legislature. Tempting as it is for courts to make policies
that protect consumers, our role is much more circumscribed. We must interpret the law fairly and
defer to the Legislature’s policy choices. We thus adopt a more measured approach that harmonizes
the importance of contractual liberty with legislatively enacted public-policy limitations.
Notwithstanding the Reimbursement Provision’s apparent overbreadth, we will not improperly
employ public policy to mechanically jettison the parties’ agreement. Rather, we must read the
agreement in conformity with the limitations imposed in the Property Code and refuse enforcement
only when doing so would create an actual conflict with the statute. Cf. Lewis, 199 S.W.2d at 149.
Consequently, we will decline to enforce the Reimbursement Provision only if the evidence
establishes its invalidity in the situation at hand.
8
J U STIC E D EVIN E ’s insistence that the Reimbursement Provision is facially void reflects a fundamental
misunderstanding of the distinction between a contract provision unenforceable as written and one that is capable of
being enforced as written. See Lewis v. Davis, 199 S.W .2d 146, 148-49 (Tex. 1947) (“A contract to do a thing which
cannot be performed without a violation of the law is void.” (quoting Tex. Emp’rs Ins. Ass’n v. Tabor, 283 S.W . 779,
780 (Tex. Comm’n App. 1926, judgm’t adopted)) (emphasis added)). In the landlord-tenant context, the parties are free
to contract as they choose and their agreement will be enforced except to the extent prohibited by law. Importantly, the
Legislature has not (1) categorically prohibited shifting of repair costs, (2) prohibited tenants from assuming
responsibility for repairs that are not caused by the tenant, or (3) prohibited shifting the costs to repair conditions of
habitability. Rather, the Legislature has only prohibited contractual shifting of repair costs if both habitability and
third-party cause are factually presented. The Reimbursement Provision is not void because it can be lawfully enforced
as written; the party seeking to avoid enforcement on illegality or public-policy grounds bears the burden of proving that
an exception to enforcement applies. The approach to contract enforcement J U STIC E D EVIN E advocates— reflexive
voiding of any contract provision that could be performed in conflict with a statute— turns the illegality defense on its
head and upsets settled contract expectations. Cf. Santoro v. Accenture Fed. Servs., LLC, 748 F.3d 217, 221-23 (4th Cir.
2014) (rejecting argument that arbitration provision was wholly unenforceable because its language encompassed rights
and remedies made nonwaivable and nonarbitrable; statute making arbitration agreements for such claims invalid and
unenforceable was an exception to enforcement and party opposing arbitration had burden of establishing exception).
24
E. The Record Does Not Conclusively Establish Unenforceability
The critical fact that bears on contract invalidity in this case is whether, within section
92.052(b)’s meaning, the fire that originated in chattel owned and operated by White was “caused
by” White even though the source of ignition is unknown. See Churchill Forge, 61 S.W.3d at 373.
With respect to that matter, the parties join issue on the proper construction of section 92.052(b) with
regard to the burden of proof and the existence of a fault-based limitation.
We review statutory construction issues de novo, R.R. Comm’n of Tex. v. Tex. Citizens for
a Safe Future & Clean Water, 336 S.W.3d 619, 624 (Tex. 2011), and our primary objective is to give
effect to the Legislature’s intent as expressed in the statute’s language, First Am. Title Ins. Co. v.
Combs, 258 S.W.3d 627, 631-32 (Tex. 2008). We discern legislative intent from the statute as a
whole, not from isolated portions. 20801, Inc. v. Parker, 249 S.W.3d 392, 396 (Tex. 2008). Absent
an absurd result, we rely on the plain meaning of the text unless a different meaning is supplied by
legislative definition or is apparent from the context. City of Rockwall v. Hughes, 246 S.W.3d 621,
625-26 (Tex. 2008).
Applying these well-established statutory-construction principles, we hold the causal standard
in section 92.052(b) is not fault-based, and White bears the burden of proving facts in avoidance of
contract enforcement. Given this statutory construction, we further conclude that White cannot rely
on the jury’s negative finding to question one—inquiring whether her negligence caused the fire—as
a substitute for an affirmative finding that the damages were not tenant caused. White’s failure to
submit a causation question to the jury is the lynchpin for concluding she has failed to prove her
affirmative defense.
25
1. Burden of Proof
White carries the burden of pleading and proving the contract’s invalidity as an affirmative
defense. See Franklin v. Jackson, 847 S.W.2d 306, 310 (Tex. App.—El Paso 1992, writ denied)
(“The presumption being in favor of legality, the burden of proof is on the party asserting the
illegality.”); TEX . R. CIV . P. 94 (listing contract-avoidance defenses that are affirmative
defenses—failure of consideration, fraud, illegality, and statute of frauds—and extending the
affirmative-pleading requirement to “any other matter constituting an avoidance or affirmative
defense”). As we recently explained, an affirmative defense “defeats the plaintiff’s claim without
regard to the truth of the plaintiff’s assertions” and places “the burden of proof [] on the defendant
to present sufficient evidence to establish the defense and obtain the requisite jury findings.” Zorilla
v. Aypco Constr. II, LLC, 469 S.W.3d 143, 156-57 (Tex. 2015). The disputed issue is whether White
secured the findings necessary to prove her landlord had a nonwaivable repair duty under the facts
of this case.
As we have discussed in some detail, the anti-waiver prescription in section 92.006(c) is
“triggered” only if the landlord has a duty to repair or the tenant has a remedy under subchapter B.
Churchill Forge, 61 S.W.3d at 372-73. The existence of a duty to repair is the key inquiry because,
under subchapter B, a landlord’s liability and a tenant’s repair remedies are conditioned on the
existence of a duty under section 92.052. See TEX . PROP . CODE §§ 92.056(a) (“A landlord’s liability
under this section is subject to Section 92.052(b) regarding conditions that are caused by a tenant
. . . .”), (e) (providing remedies to a tenant to whom a landlord is liable), .0561(d) (providing tenant
repair and deduct remedies “only if . . . [t]he landlord has a duty to repair or remedy the condition
under section 92.052” and other requirements are met); see also Churchill Forge, 61 S.W.3d at
26
371-72; cf. TEX . PROP. CODE § 92.0563(b) (providing a statutory remedy if a landlord knowingly
contracts to waive the landlord’s duty to repair).
Section 92.052 defines the landlord’s duty of diligent repair as follows:
(a) A landlord shall make a diligent effort to repair or remedy a condition if:
(1) the tenant specifies the condition in a notice to the person to whom or to
the place where rent is normally paid;
(2) the tenant is not delinquent in the payment of rent at the time notice is
given; and
(3) the condition:
(A) materially affects the physical health or safety of an ordinary
tenant; or
(B) arises from the landlord’s failure to provide and maintain in good
operating condition a device to supply hot water of a minimum
temperature of 120 degrees Fahrenheit.
(b) . . . [T]he landlord does not have a duty . . . to repair or remedy a condition caused
by:
(1) the tenant;
(2) a lawful occupant in the tenant’s dwelling;
(3) a member of the tenant’s family; or
(4) a guest or invitee of the tenant[]
[unless the condition was caused by normal wear and tear].
(c) This subchapter does not require the landlord:
(1) to furnish utilities from a utility company if as a practical matter the utility
lines of the company are not reasonably available; or
(2) to furnish security guards.
(d) The tenant’s notice under Subsection (a) must be in writing only if the tenant’s
lease is in writing and requires written notice.9
TEX . PROP . CODE § 92.052. Read in isolation, section 92.052 could be construed in two ways, but
only one construction is reasonable when the statute is considered as a whole. See In re Office of the
9
W hite’s lease requires that all notices and requests be in writing “except in case of fire, smoke, gas, explosion,
overflowing sewage, uncontrollable running water, electrical shorts, crime in progress, or fair housing accommodation
or modification.”
27
Att’y Gen. of Tex., 456 S.W.3d 153, 155-56 (Tex. 2015) (emphasizing the importance of context in
questions of statutory construction).
Construed in context, section 92.052 defines the landlord’s duty by both positive and negative
references and imposes a repair obligation only if all its elements are satisfied. Such a construction
properly places the burden of proof on the party claiming the existence of a duty. See Humble Sand
& Gravel, Inc. v. Gomez, 146 S.W.3d 170, 182 (Tex. 2004) (when one claims a duty owed by
another, the party claiming the duty generally bears the burden of establishing it). But more
importantly, it places the burden of proof on the party who controls the leased premises and is,
therefore, in the best position to (1) avoid damage to the premises and (2) prove that another party
is responsible for the damage.
The dissenting justices read section 92.052(a) as defining the landlord’s duty and subsection
(b) as presenting an exception. ___ S.W.3d at ___ (BOYD , J., dissenting). Under this view, White
need only plead and present sufficient evidence of the three elements in subsection (a) to carry her
burden of proving an unwaivable repair duty, and the landlord can escape liability only by proving,
under subsection (b), that the condition was caused by the tenant. In other words, subsection (a)
provides the elements of White’s affirmative defense and subsection (b) provides the elements of the
landlord’s counter defense. A duty/exception construction of section 92.052 presents, on its face, a
plausible, natural reading of subsections (a) and (b) and serves the salutary purpose of encouraging
prompt remediation of conditions affecting habitability.
But it also poses several practical problems and is inconsistent with the statute as a whole.
Among other issues, a duty/exception construction of section 92.052 places the landlord at a distinct
disadvantage in attempting to prove the cause of damage to premises under the tenant’s control,
28
creating potentially insurmountable proof problems. The facts of this case, though unusual in the
degree of damage, are a prime example.
We need not speculate about which construction the Legislature intended, however, because
section 92.053 of the Property Code resolves the issue and plainly charges the tenant with the burden
of proving the cause of any premises condition if the landlord’s obligation to repair the condition is
disputed.
Section 92.053 provides:
(a) Except as provided by this section, the tenant has the burden of proof in a judicial
action to enforce a right resulting from the landlord’s failure to repair or remedy a
condition under Section 92.052.
(b) If the landlord does not provide a written explanation for delay in performing a
duty to repair or remedy on or before the fifth day after receiving from the tenant a
written demand for an explanation, the landlord has the burden of proving that he
made a diligent effort to repair and that a reasonable time for repair did not elapse.
Id. § 92.053 (emphasis added). A tenant’s repair remedies under subchapter B are conditioned on
the existence of a duty under section 92.052. In fact, section 92.052’s sole function is to provide a
basis for the tenant to obtain repairs or a statutory remedy under subchapter B. If the tenant satisfies
all the requirements in section 92.052(a) and the landlord does nothing, the tenant has no remedy
under subchapter B except on the terms provided. Accordingly, section 92.053(a) necessarily
allocates the burden of proof under section 92.052 to the tenant. In doing so, section 92.053 makes
no distinctions among section 92.052’s various subsections. Compare id. § 92.056 (“A landlord’s
liability [to a tenant for failure to diligently repair] is subject to Section 92.052(b) regarding
conditions that are caused by a tenant and Section 92.054 regarding conditions that are insured
casualties.”). Even so, section 92.053(a) is not inherently inconsistent with burden-shifting under
29
section 92.052, and if section 92.053 were silent about the landlord’s burden of proof, it might add
nothing to the analysis.
But section 92.053 not only speaks to the tenant’s burden, it specifies a discrete and limited
circumstance in which the landlord bears the burden of proof. Significantly, section 92.053(b) does
not allocate the burden of proof under section 92.052(b) to the landlord. Thus, even if section
92.052’s structure could support the burden-shifting construction of the statute the dissenting justices
favor, section 92.053 provides differently.10 Taken together, sections 92.052 and 92.053 create a
presumption that damage to premises under the tenant’s control was caused by the tenant and the
tenant must prove otherwise.11 Absent such proof, the landlord has no duty to repair, and an
agreement allocating repair responsibility to the tenant does not contravene section 92.006.
The Legislature has spoken, and we are not empowered to determine what is “fair” legislative
policy. Amicus briefs filed in connection with this case raise a number of competing interests and
concerns in the landlord-tenant relationship, but the duty to balance opposing interests and equities
and to set the policy of the state lies with our duly elected representatives. Our duty is to give effect
to the Legislature’s collective policy determinations.
10
Language we employed in Churchill Forge assumes the opposite but burden of proof was not at issue in that
case. See Churchill Forge, 61 S.W .3d at 370 (noting that questions of tenant negligence and causation were not
presented).
11
This point is illustrated by a later-enacted provision in the subchapter governing security devices. Though
landlords generally have a duty to pay the cost to repair or replace a security device, the tenant can contractually assume
responsibility for repairs resulting from misuse or damage by the tenant or an affiliated party. T EX . P RO P . C O DE
§ 92.162(a), (b); see also id. § 92.006(b). Significantly, “[m]isuse or damage to a security device that occurs during the
tenant’s occupancy is presumed to be caused by the tenant, a family member, an occupant, or a guest. The tenant has
the burden of proving that the misuse of or damage was caused by another party.” Id. § 92.162(b). Much like the repair
duty imposed in section 92.052, inoperable security devices raise tenant-safety concerns, but the obligation to pay for
necessary repairs may be contractually delegated if the tenant causes the damage, and the tenant is charged with
establishing damage was not tenant caused. W e do not cite section 92.162 as support for a particular construction of
sections 92.052 and 92.053 but as an equivalent legislative expression regarding the burden of proving the cause of
damage to a demised dwelling.
30
2. Essential Fact Findings Are Lacking
White did not meet her burden to obtain the requisite fact findings. The jury failed to find that
White’s negligence proximately caused the fire, but made no affirmative finding regarding causation.
Both White and the court of appeals relied on the jury’s negative response to the negligence question
as a proxy for establishing the factual predicate to the landlord’s repair duty. The court of appeals
provided no analysis of the issue, but White asserts that the negligence finding resolves the public-
policy matter because “caused by” requires fault and proximate cause. We disagree and conclude that
(1) “caused by” is not a fault-based standard, (2) a failure to find response to the negligence question
does not equate to an affirmative finding of no causation, and (3) assuming without deciding that
proximate cause is the relevant causal standard, the record does not conclusively establish that
White’s actions did not cause the fire.
Because White bears the burden of proof, the jury’s failure to find White’s negligence caused
the fire is not dispositive of the landlord’s duty. A negative answer to the negligence issue simply
means that Philadelphia Indemnity failed to carry the burden of proof on its negligence claim; it is
not a positive finding that White was not at fault or did not cause the damage. See, e.g., Battaglia,
M.D., P.A. v. Alexander, 177 S.W.3d 893, 903 (Tex. 2005) (“The jury’s failure to find Battaglia
negligent was not an affirmative finding that Battaglia was not negligent.”); Grenwelge v. Shamrock
Reconstructors, Inc., 705 S.W.2d 693, 694 (Tex. 1986) (holding that the jury’s failure to find breach
of contract meant the plaintiffs failed to carry their burden of proof, not that the defendant
substantially performed the contract); Arbor Windsor Court, Ltd. v. Weekley Homes, LP, 463 S.W.3d
131, 141 (Tex. App.—Houston [14th Dist.] 2015, pet. filed) (“A negative answer to a jury question
on ‘failed to comply with a contract’ is not a positive finding that [the] party ‘complied with a
31
contract.’”); Cullins v. Foster, 171 S.W.3d 521, 536-37 (Tex. App.—Houston [14th Dist.] 2005, pet.
denied) (“If the jury makes a negative finding in answer to a question, it means the party with the
burden of proof has failed to carry its burden.”). Characterizing the jury’s negative response to
question one as an affirmative finding that White did not cause the damage thus misinterprets the
jury’s finding. See C. & R. Transp., Inc. v. Campbell, 406 S.W.2d 191, 194 (Tex. 1966) (jury’s
negative finding to special issue regarding truck driver’s actions before accident could not be treated
as an affirmative finding of the opposite; jury’s refusal to find meant only that the party bearing the
burden of proving the fact failed to do so); cf. Sterner v. Marathon Oil Co., 767 S.W.2d 686, 690
(Tex. 1989) (for purposes of determining the proper standard of review, “treat[ing] the jury’s failure
to find that [the defendant] acted with justification or excuse as a finding by the jury that [the
defendant] acted without justification or excuse . . . is a misinterpretation of both the issue and the
answer”). Philadelphia Indemnity had the burden to obtain an affirmative finding on its negligence
claim, but the onus was on White to obtain an affirmative finding that the fire-related damages were
not “caused by” her to establish her affirmative defense to Philadelphia Indemnity’s contract claim.
The jury’s finding also does not aid White because fault and causation were commingled, and
section 92.052(b) does not employ a fault-based standard. Cause does not inherently connote fault;
rather they are distinct inquiries. While the Legislature is free to provide a more expansive meaning
of “caused by” for purposes of chapter 92, it did not do so. The absence of fault-based language in
section 92.052(b) is further telling when contrasted with other provisions in chapter 92 incorporating
such language. Compare TEX . PROP . CODE §§ 92.001 (defining “normal wear and tear” as excluding
“deterioration that results from negligence, carelessness, accident, or abuse of the premises,
equipment, or chattels by the tenant, by a member of the tenant’s household, or by a guest or invitee
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of the tenant”), .006(f) (excluding from permissible contracts those conditions “caused by the
negligence of the landlord”), .0131 (landlord liable only if vehicle damage caused by towing service’s
negligence), and .054 (providing the tenant a remedy if the rental premises are unusable due to a
casualty loss totally or partially destroying habitability and “the casualty loss is not caused by the
negligence or fault of the tenant”), with id. § 92.052(b). “We presume that the Legislature chooses
a statute’s language with care, including each word chosen for a purpose, while purposefully omitting
words not chosen.” TGS-NOPEC Geophysical Co. v. Combs, 340 S.W.3d 432, 439 (Tex. 2011). We
would have to add words to section 92.052 to give it the meaning White advances. This we cannot
do when the statute, construed as a whole, reflects the Legislature’s decision to incorporate fault-
based standards in some provisions and not others. While fault-based tenant-caused conditions
would certainly be excluded from the landlord’s statutory repair duty, that is not the exclusive
standard.
Having concluded that section 92.052(b) does not employ a fault-based standard, jury
question one is further insufficient to satisfy White’s burden because (1) there is no way to discern
the basis for the jury’s finding—a failure to find negligence, proximate cause, or both, and (2) White
bore the burden of establishing the cause of the fire. Cf. Crown Life Ins. Co. v. Casteel, 22 S.W.3d
378, 389 (Tex. 2000). The single broad-form submission was an inadequate vessel to establish both
Philadelphia Indemnity’s negligence claim and White’s conceptually distinct contract-avoidance
defense.12 See id.
12
The significance of the jury’s failure to find in relation to W hite’s burden of proof involves an abstruse
concept. An example employing a less abstract scenario may be helpful in illustrating the point. Consider a situation
in which a party bears the burden of proving there is no life on Mars, but the jury question inquires “Do you find by a
preponderance of the evidence that there is life on Mars?” The jury’s negative finding does not establish the
converse— that there is no life on Mars— but merely reflects a failure to carry the burden of persuasion as to the presence
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Despite the absence of an affirmative finding regarding the cause of the fire, White could
establish her affirmative defense if the record conclusively establishes the absence of the requisite
causal relationship, either by negating White’s role in causing the damage or by establishing an
alternative cause of the damage. The record does not do so, however.
At trial, the jury heard evidence that the fire originated in a clothes dryer that was owned by
White and under her exclusive control; she was using the dryer at the time the fire started; the dryer
was filled with several items; a firefighter testified that some dryer fires are caused by overloading;
the dryer manual warned against drying certain materials; a fire department report indicated the
possible presence of prohibited materials; White admitted that she had not read the labels on any of
the items she put into the dryer and was unaware of any restrictions on drying the items; the dryer’s
instruction manual warns that cooking oils may cause clothing to catch fire and an expert testified
to the presence of vegetable oil residue in samples from the dryer drum; expert witnesses found no
evidence of electrical or mechanical malfunction within the dryer, and arson and lint build-up were
eliminated as causes; the power cord (which remained intact), the power receptacle, and the circuit
breaker were also eliminated as causes; there was no evidence of acts of God or intervention by third
parties; and no witness was able to explain how the fire inside the dryer drum started. This is more
than some evidence that White’s actions, even if not negligent, caused the fire that originated in her
of life on M ars. But even supposing a failure to find could be construed as establishing the obverse, it would not do so
if the jury question interconnected two distinct inquiries, such as “Do you find by a preponderance of the evidence there
is life and water on M ars?” The jury’s negative response could be attributed to a failure to persuade as to one element
or both. W hile there may be situations when the evidentiary record conclusively establishes one or the other, absent such
circumstances, the party bearing the burden of obtaining an affirmative finding that there is no life on Mars lacks the fact
findings necessary to do so.
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personal appliance. Accordingly, White has not established that the Reimbursement Provision, as
applied, contravenes the limitations set forth in section 92.006.
The dissenting justices lament that applying section 92.053 as it is plainly written places
White in the “difficult[]” position of “proving a negative,” ___ S.W.3d at ___ (BOYD , J., dissenting),
but the issue is more accurately stated as requiring her to prove the fire’s cause. To highlight the
hardship White purportedly faces in meeting her burden, the dissenting opinions note that a
maintenance worker actually connected the dryer for White because her prior attempt failed when the
power receptacle sparked and the circuit breaker tripped. Id.; see also ___ S.W.3d at ___ (DEVINE ,
J., dissenting). Any disadvantage to White based on these circumstance is not apparent, however,
because the role the power cord, power receptacle, and circuit breaker played in causing the fire was
susceptible of proof by both parties, and these items were affirmatively eliminated as causes of the
fire that originated in the dryer drum.
III. CONCLUSION
“[C]ompetent parties in Texas ‘shall have the utmost liberty of contracting.’” Churchill
Forge, 61 S.W.2d at 370 (quoting Wood Motor Co., 238 S.W.2d at 185). But when a contractual
arrangement is inconsonant with public policy expressed in a regulatory statute, preservation of
contractual freedom and its “indispensable partner”—contract enforcement—must yield. See
Woolsey v. Panhandle Ref’g Co., 116 S.W.2d 675, 678 (Tex. 1938) (“In line with the universally
accepted rule, this court has repeatedly refused to enforce contracts which are either expressly or
impliedly prohibited by statutes or by public policy.”); see also Fairfield Ins., 246 S.W.3d at 664
(contract enforcement is a necessary corollary to liberty of contracting). While the lease provision
is susceptible of an application in contravention of the statute, we must exercise judicial restraint in
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holding arm’s-length contracts void on public-policy grounds. Royston, Rayzor, Vickery, & Williams,
467 S.W.3d at 504. Thus, a contract capable of being performed in harmony with the laws and
statutes of this State is not per se void as against public policy. Unless an agreement cannot be
performed without violating the law or public policy, the party seeking to avoid enforcement must
establish its invalidity under the particular circumstances. White failed to do so in this case.
The Texas Property Code’s restrictions on contractually shifting the landlord’s repair
obligations do not apply if a landlord has no duty to repair in the first instance. Landlords have no
obligation to repair premises conditions that are tenant-caused and therefore are not restrained from
contracting with tenants for reimbursement of associated repair costs. White failed to obtain a
finding that she did not cause the damages at issue; the jury’s failure to find in response to a
negligence submission is not a substitute for the essential fact finding; and the record does not
conclusively establish that fact. Accordingly, White failed to establish the factual predicate to
contractual invalidity in this case. We therefore reverse the court of appeals’ judgment to the extent
it invalidates the Reimbursement Provision on public-policy grounds and render judgment that the
lease provision is not unenforceable on that basis. We affirm the court of appeals’ judgment on
ambiguity, but we remand the case to that court for consideration of White’s remaining defenses to
enforcement.
___________________________
Eva M. Guzman
Justice
Opinion delivered: May 13, 2016
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