Tuesday, November 03, 2020

An Overview of the Civil Practices and Remedies Code Chapter 95

By Zachary Faulkner


This article serves as an outline to Chapter 95 and how courts have construed the chapter. After twenty-five years of its enactment, courts have provided some guidance on how the statute fits within the larger context of tort law. Though this article is not comprehensive, it is a good starting place to begin further, narrower research into the themes of Chapter 95.

 

Legal Framework

Chapter 95 states that property owners are not liable for personal injuries, death, or property damage arising from the construction, repair, renovation, or modification of improvements to real property by an independent contractor arising from the failure to provide a safe workplace unless the plaintiff can establish that the premises owner

  1. exercised or retained some control over the manner in which the work is performed,

  2. possessed actual knowledge of the danger or condition causing injury, and

  3. failed to warn of that danger.

 

Interpretation of the Statute and Issues that Have Been Addressed

Chapter 95 has been interpreted broadly by Texas courts. In essence, Chapter 95 protects property owners against, inter alia, claims of premises liability, negligence, negligent hiring, and respondeat superior claims. Chapter 95 includes an exception, but the elements a plaintiff must establish to invoke this exception have proven to be an extremely high burden. The statute covers residential and commercial property owners. As such, Chapter 95 should usually be included as an affirmative defense when a contractor is injured on your property.

 

A. Who is a “property owner” who can invoke Chapter 95 protection?

“Property owner” is defined by the statute as “a person or entity that owns real property primarily used for commercial or business purposes.” Courts have been presented with the issue of whether a property owner’s employees or agents are protected by the statute. In Ineos USA, LLC v. Elmgren, the court interpreted the plain language of the definition and held that “Chapter 95 does not apply to claims against an employee or agent of a property owner.” 505 S.W.3d 555, 569 (Tex. 2016).  Therefore, “property owner” is limited to the person or entity that possessed legal title to the land where the incident occurred.

 

B. Who is a “contractor” under the statute?

Invitees, licensees, trespassers, and contractors. Unlike “property owner,” the statute does not define “contractor.” However, when presented with the issue, “contractor” is another term courts have interpreted broadly. In First Texas Bank v. Chris Carpenter, the court was presented with the issue of whether a contract is needed to qualify the plaintiff as a contractor. The court held that statute covers not only contractors who have agreements with owners, but their employees, subcontractors, and their subcontractors’ employees, none of whom would ordinarily have a contract with the owner. The court reasoned that “[Chapter 95] applicability turns on the kind of work being done, not on whether an agreement for the work to be done is written, or formal, or detailed. And many agreements for such work are informal.” 491 S.W.3d 729, 732 (Tex. 2016).  The court gave the word its ordinary meaning, and defined “contractor as someone who makes improvements to real property.”  Id.

 

C. Interpretation of “construction, repair, renovation, or modification of improvements to real property”

The analysis of this phrase goes hand-in-hand when answering the question as to whether the person performing the work is a “contractor,” but this inquiry takes it a step further and looks at the instrumentalities of the contractor’s injuries. Courts have broadly construed this phrase, thus effectively extending the reach of Chapter 95 protection. This is a fact issue, determined on a case-by-case basis, but most courts have held that a wide variety of actions qualify as “construction, repair, renovation, or modification of improvements to real property.” For instance, the placement of a portable toilet at a job site qualifies as “construction, repair, renovation, or modification of improvements” to real property according to the Third District Texas Court of Appeals. James v. Cousins Props. Tex., L.P., No. 03-06-00617-CV, 2008 Tex. App. LEXIS 3966, at *11 (Tex. App.—Austin May 30, 2008, no pet.). This is just one example of how far courts will go to interpret the phrase “construction, repair, renovation, or modification of improvements to real property.”

 

D. Interpretation of “exercised or retained some control over the manner in which the work is performed”

The first element a plaintiff must prove to get around Chapter 95 is that the property owner exercised or retained some control over the manner in which the work was performed. For a plaintiff to demonstrate that the property owner maintained a contractual right to control the work, the contract at issue must “explicitly assign” the premises owner that right. Absent a contract retaining the right to control the manner in which the work is completed, the plaintiff must prove actual control by presenting evidence that the property owner exercised control over the means in which the work was completed. This is a factual determination decided on a case-by-case basis, but can include, for example, showing that the property owner directed the contractor to use particular tools to complete the work.

 

E. Negligent hiring?

More recently, in Endeavor Energy Resources LP v. Cuevas, 593 S.W.3d 307 (Tex. 2019), the Texas Supreme Court was presented with the question as to whether negligent hiring claims are protected by Chapter 95. As discussed above, agents of a property owner are subject to liability and are not afforded the protection of Chapter 95. As such, negligent hiring claims appeared to be the next logical argument injured contractors had against property owners themselves. However, the court rejected this reasoning and concluded that Chapter 95 covers all negligent claims against the property owner. The only way a claimant can assert a negligent hiring claim is if the claimant can establish all three elements of the exception to Chapter 95, but the claimant additionally must still prove each element of negligent hiring to establish the claim. “So when the property owner negligently hires a contractor and the contractor later negligently creates a risk through work over which the property owner retains some control, the plaintiff can recover for negligent hiring if the property owner has actual knowledge of that risk.” See Endeavor Energy Resources, 593 S.W.3d at 312.

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