By: Doug Rees
Chapter 95 of the Texas Civil Practice & Remedies Code provides protection for property owners against claims by contractors, limiting their liability to a very narrow context. Specifically, Chapter 95 provides that a property owner is not liable for personal injury to a contractor unless the property owner exercises or retains some control over the manner in which the work is performed and the property owner had actual knowledge of the danger or condition and failed to adequately warn about it. A property owner’s general liability to invitees, that is basically anyone else who enters the property, is of course much broader.
Recently, the Texas Supreme Court addressed the issue of who qualifies as a contractor under Chapter 95 entitling the property owner to the protections afforded under the statute for claims brought against it. The case, First Texas Bank v. Chris Carpenter, No. 15-0172 (Tex. June 10, 2016), involved a contractor who regularly did work for a bank. Chris Carpenter was a contractor who had done work for years for First Texas Bank and was considered to the bank’s “go-to guy” for roof repairs. The roof of the bank suffered hail damage and apparently Carpenter is the one who reported the hail damage to the bank. The bank decided to report the claim to its insurance carrier and asked Carpenter to show the insurance adjuster the damage. While coming down from the second tier of the bank’s roof, Carpenter fell off the ladder he was using, crushing two vertebrae. The ladder belonged to the bank and was stored on the roof to provide access from the first of the roof to the second tier. Carpenter claimed that the ladder was defective, causing his fall, and brought claims against the bank.
In response to his claims, the bank invoked Chapter 95, asserting that Carpenter was a contractor and that it could not be liable to him because it did not control his work or know of any defect in its ladder. Carpenter asserted that Chapter 95 was not applicable because he had no contract with the bank to perform any work at the time he was injured. The trial court granted summary judgment for the bank. The Court of Appeals reversed the trial court’s ruling, finding that Carpenter was not a “contractor” as contemplated by the statute because he did not have an actual contract with the bank to perform any work at the time of the incident. He was simply up on the roof showing the hail damage to the insurance adjuster. The fact that the evidence showed that Carpenter was the bank’s regular contractor, that he believed he would be the person to make whatever repairs the bank decided to make, and that he had even discussed with bank personnel the plan and process for filing an insurance claim in order to fund the repairs to the roof made no difference to the Court of Appeals. The Court of Appeals focused on the fact that the parties had yet to reach an agreement on the actual scope of repairs and what the terms of compensation would be for the work to be performed.
In addressing the issue, the Supreme Court took a somewhat different view of what constitutes a “contractor” under Chapter 95. The Court noted that Chapter 95 is not a statute regulating contracting in general and does not turn on whether an agreement for the work to be done is written, formal or detailed. The Court further noted that the statute covers not only contractors who have agreements with owners, but also their employees, sub-contractors and their sub-contractors’ employees, and none of those parties typically have a contract with the owner. The Supreme Court held that a “contractor” is someone who makes improvements to real property and is not limited to only those contractors who have a formal contract with the owner. The Court further noted that Carpenter’s testimony was that he was a “handshake guy” and that he did work for the bank without “16 pages of contracts to paint or fix something.” He was not likely to have a written contract even if the bank ultimately hired him to repair the roof. Carpenter was the bank’s roofing contractor, had been for years, and the Supreme Court held that he was a “contractor” and subject to the provisions of Chapter 95.
The inquiry, however, does not end with whether or not the claimant qualifies as a “contractor” under the statute. The statute only applies to contractors who construct, repair, renovate, or modify an improvement to real property. Focusing on these other provisions (i.e., the rest of the statute), the Supreme Court noted that the record was not sufficient to show that Carpenter was actually engaged in repairing or modifying the roof at the time of the incident. The evidence in the record showed that the bank had never fully decided what, if any, repairs it was going to make. The Court noted that if the insurance carrier denied the claim, the bank might have decided not to perform any repairs and the bank had not definitively decided who it was going to hire if it decided to perform repairs. The trial court’s granting of summary judgment in favor of the bank was therefore improper and the case was remanded back to the trial court for further proceedings.
Whether a statute applies to a particular claim often involves a detailed analysis and the claim typically has to fit within all of the provisions of the statute.