Cadence McShane Construction Company v. Ryan BB-Blockhouse Creek

2025 Tex. Bus. 43
Texas Business Court·Decided November 3, 2025·No. 25-BC03B-0002·Published

Opinion

2025 Tex. Bus. 43

The Business Court of Texas, Third Division

CADENCE MCSHANE § CONSTRUCTION COMPANY § LLC, § § Cause No. 25-BC03B-0002 Plaintiff, §

v. § §

RYAN BB-BLOCKHOUSE CREEK, §

LLC, §

Defendants.

═══════════════════════════════════════ Syllabus *

═══════════════════════════════════════

This opinion addresses Defendant’s plea to the jurisdiction which challenged the Court’s jurisdiction over Plaintiff’s third-party claims filed against multiple subcontractors who performed work on a construction project. The Court denied Defendant's plea to the jurisdiction, concluding the third-party claims met the definition of an “action arising out of a qualified transaction” under Section 25A.004(d)(1). Further, the Court found the third-party claims were neither “conjectural, hypothetical or remote” and therefore ripe.

*

The syllabus was created by court staff and is provided for the convenience of the reader. It is not part of the Court’s opinion, does not constitute the Court’s official description or statement, and should not be relied upon as legal authority.

FILED IN

BUSINESS COURT OF TEXAS

BEVERLY CRUMLEY, CLERK

2025 Tex. Bus. 43 ENTERED 11/3/2025

The Business Court of Texas, Third Division

CADENCE MCSHANE § CONSTRUCTION COMPANY § LLC, § § Cause No. 25-BC03B-0002 Plaintiff, §

v. § §

RYAN BB-BLOCKHOUSE CREEK, §

LLC, §

Defendants.

═══════════════════════════════════════ OPINION AND ORDER

═══════════════════════════════════════

I. Introduction

¶1 This breach of contract case arose from the construction of a large 347-

unit apartment complex in Leander, Texas. The general contractor of the project, Cadence McShane Construction Company LLC (“CMC”), filed a breach of contract lawsuit against Ryan BB-Block House Creek, LLC (“Ryan”), the landowner. In turn, Ryan filed counterclaims complaining of CMC’s alleged mismanagement of the project and a litany of alleged construction defects.

¶2 Later, CMC filed third party claims against 18 subcontractors who per-

formed work on the project. Here, Ryan filed a plea to the jurisdiction challenging the Business Court’s jurisdiction over the third-party claims. In this case, the Court must determine whether it has jurisdiction of CMC’s claims against the third-party subcontractors. Because the Court concludes that the lawsuit and third-party claims meet the definition of an “action arising out of a qualified transaction” under Sec- tion 25A.004(d)(1) and are within the Business Court’s jurisdiction, the Court denies Ryan’s plea to the jurisdiction. 1 II. Background

A. Case History

¶3 CMC and Ryan are the original parties to this action. In 2021, Ryan contracted with CMC to serve as the general contractor of a 347-unit apartment complex known as “Blockhouse Creek Farm Multifamily” in Leander, Texas in ex- change for a maximum contract payment of $60,547,244.

¶4 Construction began on the project in 2022. By 2024, the relationship between the parties had soured. Ryan allegedly terminated the contract on Novem- ber 7, 2024, claiming CMC failed to fulfill its duties as general contractor. In turn,

1 Ryan’s plea to the jurisdiction also included motions to strike and sever. The Court’s Opinion and Order addresses only the jurisdictional challenges outlined in Ryan’s plea to the jurisdiction, the other motions are addressed in a separate order and forthcoming order. See Ryan BB-Block House Creek’s Plea to the Jurisdiction, or in the Alternative, Motion to Strike or Sever Cadence McShane Construction Company Third Party Claims.

CMC asserted that Ryan breached the contract when it failed to pay for construction services performed by CMC.

¶5 On February 6, 2025, CMC filed a lawsuit in the Business Court.

CMC’s petition challenged Ryan’s termination of the contract, alleged Ryan had failed to pay amounts due under the parties’ contract, and alleged that Ryan had effectively locked CMC out of the project in violation of the contract. CMC’s origi- nal petition pled causes of action for breach of contract, violations of the Texas Construction Trust Fund Act, quantum meruit, money had and received, promissory estoppel, violation of the Prompt Payment Act violations, and foreclosure of their lien.

¶6 CMC’s petition asserted this Court had subject matter jurisdiction be-

cause the contract was a qualified transaction pursuant to Section 25.004(b), and the amount in controversy exceeded $10 million dollars.

¶7 On March 26, 2025, Ryan filed counterclaims against CMC. Ryan al-

leged CMC breached its contract and failed to fulfill its duties as general contractor and asserted “CMC and its subcontractors failed to properly install and construct, among other things, the roofs, window system, stucco, and balconies.” 2 Ryan de- tailed construction deficiencies throughout the project including the roofing system, shingles, exterior sheathing, air and water barriers, balconies, fire rated

2 Ryan’s Counterclaim ¶21, Mar. 26, 2025.

assemblies and structural connections and other defective work. Further, Ryan as- serted “CMC’s failure to provide and maintain a sufficient number of experienced personnel resulted in an overall lack of supervision by CMC of its own people and the subcontractors it engaged.”3 Ryan pleaded causes of action of breach of contract damages, fraud by nondisclosure, fraudulent inducement, and filing of a wrongful lien. Ryan asserted the Business Court had subject-matter jurisdiction over its counter claims because the “dispute arises out of a qualified transaction and the amount in controversy exceeds $10,000,000.”4

¶8 On June 23, 2025, CMC filed a third-party petition naming 18 different subcontractors that performed work on the Blockhouse Creek Farm Multifamily apartment construction project. CMC’s claims were based on a uniform subcontract that it entered with each of the subcontractors that worked on the project.5 Each subcontract references the “Prime Contract” which is defined as the Con-tract between CMC and Ryan. CMC’s subcontractor contracts range in amounts from $40,070 for aluminum storefront doors, to $13,059,500 for wood framing and

3 Id. ¶17.

4 Id. ¶4.

5 CMC alleged causes of action against the subcontractors for breach of contract (additional insurance coverage), breach of contract (contract indemnity), breach of express and implied warranties, and breach of contract, negligence, contribution and comparative responsibility.

various other specified construction work on the project. 6 Only one subcontract ex- ceeded $5 million. 7 B. Ryan’s Plea to the Jurisdiction

¶9 On July 23, 2025, Ryan filed its plea to the jurisdiction challenging the Business Court’s jurisdiction over CMC’s third-party claims against the subcontrac- tors. Ryan does not dispute that the claims between it and CMC “arise from or relate to a qualified transaction under Section 25A.004(d)(1),” 8 but argues this Court’s “original jurisdiction” does not extend to CMC’s claims filed against the third-party claims against the 18 subcontractors. 9

¶10 Specifically, Ryan contends CMC “cannot aggregate” claims against multiple defendant subcontractors with “separate, independent and distinct claims.” 10 Instead, Ryan asserts that “the claims asserted against each defendant are judged separately and must independently lie within the jurisdictional parame- ters of the court.” 11

¶11 Ryan argues CMC’s third-party claims also do not fall within the Court’s supplemental jurisdiction because this Court’s supplemental jurisdiction

6 See Ryan’s Reply 4, Sept. 12, 2025.

7 Id.

8 Ryan’s Plea to the Jurisdiction 4, July 23, 2025.

9 See id. at 5.

10 Id.

11 Id. (citing French v. Moore, 169 S.W.3d 1, 7 (Tex. App.—Houston [1st Dist.] 2004, no pet.)).

does not extend to claims requiring the joinder of third parties. Alternatively, Ryan challenges the Business Court’s jurisdiction on the grounds that CMC’s third-party claims for contribution, negligence, breach of contract and breach of warranty are contingent future injuries that may never occur and are therefore unripe.

Free access — add to your briefcase to read the full text and ask questions with AI

Cadence McShane Construction Company v. Ryan BB-Blockhouse Creek, 2025 Tex. Bus. 43 (Tex. Super. Ct. 2025).

2025 Tex. Bus. 43 (Cadence McShane Construction Company v. Ryan BB-Blockhouse Creek) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Brown v. Exxon Mobil
Texas Business Court, 2026