Brenda S. Cannon v. University Trace Condominium Association ( 2005 )

Affirmed in Part, Reversed and Remanded in Part, and Majority and Dissenting Opinions filed July 7, 2005

Affirmed in Part, Reversed and Remanded in Part, and Majority and Dissenting Opinions filed July 7, 2005.

In The

Fourteenth Court of Appeals

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NO. 14-03-00993-CV

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BRENDA S. CANNON, Appellant

V.

UNIVERSITY TRACE CONDOMINIUM ASSOCIATION, Appellee

On Appeal from the 157th District Court

Harris County, Texas

Trial Court Cause No. 2000-46115

M A J O R I T Y  O P I N I O N

Appellant Brenda S. Cannon challenges the trial court=s grant of summary judgment in favor of appellee University Trace Condominium Association.  By two points of error, appellant contends the trial court erroneously dismissed her causes of action based on limitations.  We affirm in part and reverse and remand in part.      

Factual and Procedural Background

Appellant purchased a condominium unit in the University Trace Condominiums  complex and lived in the unit from March 1993 to September 1998. The University Trace Condominiums were managed by University Trace Condominium Association (AUTCA@), which was responsible for repair and maintenance of all common areas of the complex, including the exterior walls.  When appellant moved into the condominium in March 1993, she immediately began having problems with water seeping into her unit from the exterior wall.  She notified UTCA each time water entered her unit, and after each complaint, UTCA sent a repairman to her unit to repair the damage and fix the problem.  On November 1, 1993, appellant wrote a letter to UTCA regarding the Acontinual leaking of the outside wall@ and noted the previous repairs did not remedy the problem.  In her letter, appellant expressed concern about the intruding water because it indicated the interior sheetrock and insulation of her unit were getting wet and damaged. 

Appellant also began having medical problems in March 1993.  She testified in her deposition that she began having thyroid problems, upper respiratory infections, headaches, cold feet, and chills in the spring and summer of 1993.  By the fall of 1993, appellant suffered from dizziness, insomnia, unusual fatigue, light sensitivity, sound sensitivity, cold sensitivity, loss of short-term memory, muscle pain, and generally noticed she could not do things she had done in the past, such as balancing her checkbook.  In 1994, appellant noticed she was losing weight, had dry skin, was depressed, and had an unusually bitter taste in her mouth.  Appellant had learned in 1992 that she was allergic to mold, and she had been receiving allergy shots since September 1993 for her dust and mold allergies.  Appellant went on disability in the spring of 1994 and began receiving disability retirement checks shortly thereafter.   

In 1997 and 1998, appellant made additional complaints about intruding water, and each time appellant complained, UTCA sent a repairman to examine and repair the problem.  In September 1998, UTCA removed portions of the sheetrock inside appellant=s unit.  Upon removal of the sheetrock, the repairman determined the exterior brick weep holes were blocked, preventing water behind the brick from properly draining. Additionally, when the interior of the wall was exposed, mold was discovered throughout the interior of the leaking wall.  Almost immediately upon the discovery of the mold, a rash broke out on appellant=s skin, and she began experiencing hair loss.  Because of her severe allergies to mold, appellant stayed at a nearby motel until the unit could be repaired.  Appellant and UTCA, however, never came to an agreement regarding how and when to repair the unit, and appellant never returned to live in her condominium.   

On September 8, 2000, appellant filed suit against UTCA alleging negligence, gross negligence, and breach of contract.  UTCA filed a traditional motion for summary judgment contending appellant=s claims were barred by the statute of limitations because all claims accrued no later than November 1, 1993, the date appellant wrote the letter to UTCA complaining of the intruding water.  The trial court granted UTCA=s motion for summary judgment on all of appellant=s claims. On appeal, appellant contends the trial court erred by failing to account for the doctrines of continuing breach of contract, continuing tort, and continuing violation.

Standard of Review

The movant for summary judgment has the burden to show there is no genuine issue of material fact and it is entitled to judgment as a matter of law.  Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548 (Tex. 1985).  We take all evidence favorable to the nonmovant as true, indulge every reasonable inference in favor of the nonmovant, and resolve any doubts in her favor.  KPMG Peat Marwick v. Harrison County Hous. Fin. Corp., 988 S.W.2d 746, 748 (Tex. 1999).  A defendant moving for summary judgment on the affirmative defense of limitations must establish as a matter of law that the applicable statute of limitations bars the action.  Thus, the defendant must conclusively prove when the cause of action accrued and must negate the applicability of the discovery rule if pled by the non-movant. If the movant establishes the bar of limitations, the nonmovant must submit summary judgment proof raising a fact issue in avoidance of limitations.  Id.

Discussion

I.        Breach of Contract

A.      Limitations

The limitations for a breach of contract cause of action is four years.  Tex. Civ. Prac. & Rem. Code Ann. ' 16.051 (Vernon 1997); Stine v. Stewart, 80 S.W.3d 586, 592 (Tex. 2002).  In her first issue, appellant contends the trial court erred in dismissing her breach of contract claim on statute of limitations grounds.^[1]  Appellant=s second amended petition alleges that between the Fall of 1997 and September of 1998 UTCA failed to repair the exterior wall of her condominium unit and that such failure constituted a breach of the Declaration and Master Deed.  UTCA contends appellant knew the attempted repairs were insufficient in 1993; thus, her cause of action for breach of contract accrued, at the latest, when she wrote the letter to UTCA in November 1993.  Appellant filed suit against UTCA on September 8, 2000.

In support of its argument, UTCA relies on Booker v. Real Homes, Inc., 103 S.W.3d 487 (Tex. App.CSan Antonio 2003, pet. denied) and Palmer v. Sears, Roebuck & Co., 969 S.W.2d 582 (Tex. App.CFort Worth 1998, no pet.), two cases it claims are directly on point.  Although each case is factually similar in that they discuss the accrual of a cause of action involving mold, neither case involves dismissal of a breach of contract claim.  In Booker, the court dismissed Booker=s claims for negligence, gross negligence, negligent misrepresentation, intentional infliction of emotional distress, and DTPA on limitations grounds, but not the breach of contract cause of action.  103 S.W.2d at 490B91.  In Palmer, the plaintiff did not allege a breach of contract claim.  969 S.W.2d at 583.  Thus, although these cases may be instructive on other causes of action, they are irrelevant to our determination of whether the trial court properly dismissed appellant=s breach of contract claim.

B.      UTCA=s Conduct As Continuing Breach

UTCA focuses on the date appellant first knew of the initial leaks and possible damage to her condominium unit; however, appellant=s breach of contract claim is based on the alleged repairs made in 1997 and 1998. Thus, according to appellant, because she filed her lawsuit in September 2000, her claims for breach of contract based on the repairs made in 1997 and 1998 are not barred by the four-year statute of limitations.  Appellant alleged a continuing breach by UTCA of its duty to repair and maintain the common elements of the condominium complex.  

As the movant, UTCA had the burden of proving no issue of material fact exists as to the accrual date of any cause of action claimed by appellant.  KMPG Peat Marwick, 988 S.W.2d at 748.  A claim for breach of contract based on a continuing duty to repair is not barred by the statute of limitations simply because the original leak occurred outside the statute.  McCreless Props., Ltd. v. F.W. Woolworth Co., 533 S.W.2d 863, 867 (Tex. App.CSan Antonio 1976, writ ref=d n.r.e.) (finding that although leak and corrective work occurred in 1969, obligation to make further repairs dated from 1971 so that action brought in 1973 was not barred by four-year statute of limitations); see Stubblefield v. Courtland Village Townhomes Homeowner=s Ass=n, No. 01-98-00258-CV, 1999 WL 280481, at *2B3 (Tex. App.CHouston [1st Dist.] May 6, 1999, no pet.) (not designated for publication) (holding association not entitled to summary judgment on limitations grounds when it only showed original leak occurred outside statute of limitations where plaintiff alleged fraud and a continuing breach of covenant to repair and maintain the roof of the building and filed supporting summary judgment evidence in support of same).  Where a party to a contract has undertaken a continuing duty to the other party, it is a continuing covenant, and each failure to perform the duty is a separate breach.  See Salais v. Martinez, 603 S.W.2d 296, 297 (Tex. Civ. App.CEl Paso 1980, no writ) (recognizing failure to repair was a continuing breach); Kaiser v. Northwest Shopping Ctr., Inc., 587 S.W.2d 454, 457 (Tex. Civ. App.CDallas 1979, writ ref=d n.r.e.) (AThe general rule is that in the event of a material breach of contract, the promisee may treat the breach as total and sue for all foreseeable future damages, or, if the promisor has not repudiated the contract, the promisee may elect to treat the breach as partial and bring successive suits for continued or successive breaches.@). A cause of action for failure to perform the duty exists so long as breaches of the covenant continue.  See id.

Appellant alleged UTCA=s failure to repair the exterior wall of her condominium unit between the Fall of 1997 and September 1998 constituted a breach of UTCA=s continuing contractual duty to repair the common areas of the condominium, including the exterior walls, imposed upon UTCA by the Declaration and Master Deed.  See Aghili v. Banks, 63 S.W.3d 812, 816 (Tex. App.CHouston [14th Dist.] 2001, pet. denied) (recognizing condominium declarations are treated as contracts between the parties); Mitchell v. LaFlamme, 60 S.W.3d 123, 128 (Tex. App.CHouston [14th Dist.] 2000, no pet.) (same).  The summary judgment proof offered by appellant established that she reported to UTCA on more than one occasion that her condominium wall continued to leak between the Fall of 1997 and September 1998. Appellant filed suit on September 8, 2000.  By showing only that the original leak occurred more than four years before appellant filed suit, UTCA did not satisfy its burden of proving its entitlement to judgment as a matter of law on the affirmative defense of limitations.  UTCA failed to address appellant=s claim that there was a continuing breach by UTCA of its duty to repair the exterior walls of the building housing appellant=s condominium between the Fall of 1997 and September 1998. Therefore, we hold the trial court erred in granting UTCA=s motion for summary judgment against appellant on her breach of contract claim, and we sustain appellant=s first issue. 

II.       Negligence and Gross Negligence

In her second issue on appeal, appellant contends the trial court erroneously dismissed her negligence and gross negligence causes of action based on the statute of limitations.

Generally, a cause of action accrues when a wrongful act causes some legal injury, even if the fact of injury is not discovered until later, and even if all resulting damages have not yet occurred.  Murphy v. Campbell, 964 S.W.2d 265, 270 (Tex. 1997).  A party only needs to be aware of enough facts to apprise him of his right to seek a judicial remedy.  Booker, 103 S.W.3d at 491.  When a cause of action accrues is a question of law for the court to decide.  Moreno v. Sterling Drug, Inc., 787 S.W.2d 348, 351 (Tex. 1990). 

UTCA argues the evidence affirmatively establishes appellant knew by at least November 1993, the date she wrote the letter, that the leak from the exterior wall was damaging her property; therefore, according to UTCA, appellant was required to file a lawsuit for negligence and gross negligence no later than two years thereafter.  Appellant did not file suit until September 8, 2000.  Appellant contends limitations were tolled on these claims for three reasons: (1) the discovery rule; (2) the doctrine of continuing tort; and (3) the doctrine of continuing violation. 

A.      The Discovery Rule

The discovery rule will defer accrual of a cause of action until the plaintiff knows or, by exercising reasonable diligence, should know of facts giving rise to the claim.  Wagner & Brown, Ltd. v. Horwood, 58 S.W.3d 732, 734 (Tex. 2001).  The discovery rule imposes a duty on the plaintiff to exercise reasonable diligence to discover facts of negligence or omission. Booker, 103 S.W.3d at 492. It is a very limited exception and applies only when the nature of the plaintiff=s injury is both inherently undiscoverable and objectively verifiable.  Id.  An injury is inherently undiscoverable if, by its very nature, it is unlikely to be discovered within the limitations period despite the claimant=s due diligence.  S.V. v. R.V., 933 S.W.2d 1, 7 (Tex. 1996).  We determine if an injury is inherently undiscoverable on a categorical basis, rather than looking to when a particular plaintiff discovered the injury.  Horwood, 58 S.W.3d at 735.  Thus, the question in this case is not whether appellant detected the alleged negligence within the applicable limitations period; rather, we must decide whether the alleged injury is the type of injury that is generally discoverable by the exercise of reasonable diligence.  Id.

In Booker, the Bookers sued their home builder for construction defects, which allegedly caused water to seep into their house.  103 S.W.3d at 490.  The Bookers wrote a letter to Real Homes in September 1997 claiming moisture was entering their home and the windows and doors were leaking.  Shortly after writing the letter, the Bookers noticed a musty odor inside the house.  Real Homes performed repairs on the house from November 1998 through January or February 1999, and the Bookers were told the problem had been fixed. However, in July 1999, the Bookers discovered extensive water damage inside the wall, which eventually led to mold infestation.  Id.

The Bookers claimed the discovery rule applied and that limitations were tolled until they knew of the exact cause of the leaks.  Id. at 492.  The court of appeals held the discovery rule did apply, but that it only tolled limitations until the Bookers discovered the leaks because discovery of the leaks was sufficient to put the Bookers on notice of the injury and its general cause. Id.  The court concluded the Bookers= claims for negligence and gross negligence accrued, at the latest, when they wrote the letter in September 1997 complaining of leaks in their home.  Id. at 492B93. 

Similarly, in Palmer, the Fort Worth Court of Appeals held a customer=s cause of action for negligence accrued when he first discovered leaks caused by the faulty repair of his air conditioner.  969 S.W.2d at 586.  Sears had performed repairs on Palmer=s air conditioner in April 1993, and one month later, Palmer noticed the air conditioner was leaking water, which accumulated in the return air shaft.  Id. at 583.  Sears attempted to repair the leak several times between June 1993 and July 1994.  When Palmer became ill in October 1994, he had an environmental audit performed at his home and learned mold was growing from the leak in the air conditioner.  Id.  Palmer alleged the discovery rule tolled limitations because he could not have known through the exercise of reasonable diligence of his personal injuries before October 1994.  Id. at 584.  The court, however, rejected Palmer=s arguments, holding his cause of action for negligence accrued at the time Sears negligently performed repairs to the air conditioner and not on the date when the extent of the resulting damages were fully ascertainable.  Id. at 586. 

In this case, appellant was aware of the leaks in March 1993 and orally reported those leaks to UTCA.  Additionally, appellant wrote UTCA a letter in November 1993 expressing concerns about the Acontinual leaking of the outside wall.@ Appellant was also allergic to mold and began having serious medical problems within the first year of moving into the unit.  In fact, appellant applied for disability retirement because of her allergies to dust and mold.  Appellant had sufficient facts to discover the fact of injury; merely because appellant did not actually discover the mold until September 1998 does not toll limitations. Following Booker and Palmer, appellant=s negligence and gross negligence claims were tolled only until she became aware of the leaks in March 1993.  Therefore, appellant=s claims of negligence and gross negligence first asserted in September 2000 are not saved by application of the discovery rule. 

B.      Doctrine of Continuing Tort

Next, we consider whether the doctrine of continuing tort applies to appellant=s causes of action for negligence and gross negligence.  The continuing tort exception, like the discovery rule, is a limited exception to the general rules governing a cause of action=s accrual date.  See Adler v. Beverly Hills Hosp., 594 S.W.2d 153, 154, 155B57 (Tex. Civ. App.CDallas 1980, no writ) (applying the doctrine of continuing tort to a false imprisonment cause of action because the entire period of detention amounted to one continuous tort, for which a single cause of action accrued when the imprisonment ceased).  AA continuous tort involves wrongful conduct that is repeated until desisted, and each day creates a separate cause of action.@  Two Pesos, Inc. v. Gulf Ins. Co., 901 S.W.2d 495, 500 (Tex. App.CHouston [14th Dist.] 1995, no writ) (recognizing trademark infringement is a continuous wrong, giving rise to a claim for relief as long as the infringement persists).  A continuing tort involves both continuing wrongful conduct and a continuing injury, and does not accrue until the defendant=s tortious conduct ceases.  See Upjohn Co. v. Freeman, 885 S.W.2d 538, 542 (Tex. App.CDallas 1994, writ denied) (holding plaintiff=s factual allegations asserted a continuing injury resulting from the continued use of Halcion put the continuing-tort rule in issue).  The fact that damages may accumulate later does not toll limitations.  First General Realty Corp. v. Maryland Cas. Co., 981 S.W.2d 495, 502 (Tex. App.CAustin 1998, pet. denied).  The exception is rooted in a plaintiff=s inability to know that the ongoing conduct is causing her injury; thus, when the plaintiff discovers her injury and its cause, then the rationale for extending the accrual date no longer applies, and the limitations period begins to run with her discovery.  Upjohn Co., 885 S.W.2d at 544.  

Here, appellant attempts to circumvent the statute of limitations by contending that because UTCA attempted to repair the leak numerous times, those attempts amount to a continuous chain of tortious activity.  Appellant argues Aher injuries developed over time as water continued to intrude into her home with each successive rain.  Each occasion on which water leaked into the exterior walls, new damage occurred, and more mold grew, resulting in renewed exposure and renewed damage.@  Appellant is trying to string together alleged tortious acts to create continuing wrongful conduct; however, merely alleging multiple tortious acts does not create a continuing tort. 

The summary judgment record shows appellant was aware of the wrongful conduct in March of 1993,  although she did not know the extent of her injuries at that time.  The fact that appellant=s injuries developed over time is not sufficient to invoke the doctrine of continuing tort.  Thus, we hold the doctrine of continuing tort is inapplicable to this case. 

C.      Doctrine of Continuing Violation

Lastly, appellant contends the doctrine of continuing violation extends limitations with respect to her negligence and gross negligence claims.  In support of her claim, appellant relies on Edwards v. Galveston-Texas City Pilots, 203 F. Supp. 2d 759, 766 (S.D. Tex. 2002), which applied the doctrine of continuing violation to an employment discrimination claim.  (noting the Acontinuing violation doctrine is a theory by which courts may toll or extend the statute of limitations to allow a plaintiff to recover for acts that would otherwise be time-barred where a defendant=s conduct appears to be continuing in nature.@).

Under the continuing violation doctrine, a plaintiff can toll limitations when there is a persisting and continuing system of discriminatory practices.  Cooper-Day v. RME Petroleum Co., 121 S.W.3d 78, 86 (Tex. App.CFort Worth 2003, pet. denied).  AThe core idea of the continuing-violation doctrine is that equitable considerations may require that the filing period not begin until acts supportive of a civil rights action are, or should be, apparent to a reasonably prudent person in the same or similar position.@  Wal-Mart Stores, Inc. v. Davis, 979 S.W.2d 30, 42 (Tex. App.CAustin 1998, pet. denied); see also Abrams v. Baylor College of Medicine, 805 F.2d 528, 532B33 (5th Cir. 1986) (AWhere the unlawful employment practice manifests itself over time, rather than as a series of discrete acts, the violation may be found to be a continuing one that >relieves a plaintiff who makes such a claim from the burden of proving that the entire violation occurred within the actionable period.=@).  We have not found any cases, nor has appellant cited any, which apply the doctrine of continuing violation to a cause of action other than employment discrimination or retaliation, and we decline to extend its application to claims for negligence and gross negligence.

Based on the foregoing, we hold the trial court did not err in granting UTCA=s motion for summary judgment on appellant=s negligence and gross negligence causes of action, and we overrule appellant=s second issue on appeal.

Conclusion

We affirm the trial court=s judgment as to appellant=s negligence and gross negligence causes of action.  We reverse the trial court=s judgment as to appellant=s breach of contract claim and remand that claim to the trial court for further proceedings consistent with this opinion. 

/s/      John S. Anderson

Justice

Judgment rendered and Majority and Dissenting Opinions filed July 7, 2005.

Panel consists of Justices Yates, Anderson, and Hudson. (Yates, J., dissents and files a dissenting opinion).

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^[1]  Appellant alleges in her brief the trial court improperly dismissed her claims for breach of contract and warranty.  Appellant=s second amended petitionCher live pleading at the time judgment was signedChowever, does not contain an allegation of breach of warranty; therefore, with respect to appellant=s first issue, we will only address the breach of contract claim.