Ecoproduct Solutions, L.P. v. Englobal Engineering and Swenson Technology, Inc.

• Court: Court of Appeals of Texas
• Decided: June 30, 2011
• Docket: 01-10-00366-CV
• Status: Published

Opinion

Opinion issued June 30, 2011

In The

Court of Appeals

For The

First District of Texas

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NO. 01-10-00366-CV

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EcoProduct Solutions, L.P., Appellant

V.

ENGlobal Engineering, Inc. and Swenson Technology, Inc., Appellees

On Appeal from the 270th District Court

Harris County, Texas

Trial Court Case No. 2009-64881

MEMORANDUM OPINION

          EcoProduct Solutions, L.L.P. appeals from summary judgments granted in favor of ENGlobal Engineering, Inc. and Swenson Technology, Inc. on EcoProduct’s claims against them. We affirm.

Background

          This dispute arises out of the construction of a liquid calcium chloride manufacturing plant. EcoProduct created the process design for the plant, hired ENGlobal to provide engineering services, and acquired the evaporator system for the plant from Swenson. EcoProduct’s contracts with Swenson and ENGlobal each contain an arbitration provision requiring that any dispute arising out of or in connection with the contract be submitted to binding arbitration in Houston, Texas in accordance with the Commercial Arbitration Rules of the American Arbitration Association.

After problems arose with the plant, EcoProduct initiated an arbitration against Swenson. Two and a half months later, on October 31, 2008, EcoProduct sought to join ENGlobal into the Swenson arbitration. Swenson objected to joining ENGlobal in their ongoing arbitration; ENGlobal also did not consent to the joinder. In November 2008, the AAA declined to allow EcoProduct to join ENGlobal into the pending arbitration without ENGlobal’s and Swenson’s consent, noting that the parties had different arbitration contracts. The AAA advised EcoProduct that it could revisit the issue with the Swenson arbitration panel once the full panel was appointed. EcoProduct did not initiate a separate arbitration proceeding against ENGlobal or raise the issue again with the arbitration panel. Instead, EcoProduct sued ENGlobal and Swenson in state court in October 2009, approximately one year after the AAA declined to join ENGlobal into the Swenson arbitration.

EcoProduct’s petition contained an “arbitration caveat,” in which EcoProduct stated that it and Swenson were currently engaged in arbitration and requested that the trial court compel ENGlobal to join the pending arbitration and then abate the suit. EcoProduct’s petition did not merely seek arbitration; EcoProduct pled substantive causes of action against ENGlobal and Swenson for breach of contract, breach of warranty, negligence, fraudulent inducement, promissory estoppel, negligent misrepresentation and violations of the Texas Deceptive Trade Practices Act[1] and prayed for the award of actual damages of $45,000,000, exemplary damages, attorneys’ fees, and interest. The prayer of EcoProduct’s petition did not reference arbitration. EcoProduct’s petition also contained a request for disclosures, demand for jury trial, and statement that EcoProduct had paid the requisite jury fee.

In November 2009, ENGlobal answered EcoProduct’s petition and moved for traditional summary judgment on the basis of the applicable statutes of limitations. ENGlobal’s summary judgment evidence included an affidavit averring that ENGlobal’s work on the plant project was completed in August 2005, more than four years before EcoProduct filed suit. ENGlobal also moved to dismiss EcoProduct’s negligence claims for failure to file a certificate of merit in compliance with Chapter 150 of the Civil Practices and Remedies Code.

In December, Swenson answered and moved for traditional and no-evidence summary judgments, arguing that (1) EcoProduct’s claims under the DTPA were precluded by the DTPA’s statutory exclusions, (2) EcoProduct’s negligence claims were barred by the statute of limitations and were an improper recasting of its breach of contract claims, (3) the warranties pled were expressly disclaimed, (4) with respect to the breach of contract claim, there was no evidence that EcoProduct performed under the contract, (5) EcoProduct’s estoppel allegations were preempted by the parties’ contract, (6) the fraudulent inducement claim was defeated by the disclaimer of reliance in the parties’ contract, and (7) the contract barred recovery of consequential and exemplary damages.

On January 14, 2010, one week before the summary judgment hearings, EcoProduct moved to compel arbitration. The prayer of the motion to compel asked the trial court to “[o]rder all parties to Arbitration under [the pending arbitration against Swenson.]” In the text of the motion, EcoProduct asked, in the alternative, that the court “[c]ompel Arbitration against ENGlobal only and to consolidate” that arbitration with the pending arbitration against Swenson, either for discovery purposes or to have a single proceeding with two separate panels. The record on appeal does not reflect that EcoProduct ever set its motion to compel arbitration for hearing or submission.

EcoProduct also filed motions to “dismiss” the motions for summary judgment,[2] contending that the only issue the trial court could address in the suit was whether to compel arbitration. In its motions to dismiss, EcoProduct noted that it had filed a motion to compel arbitration, but it did not indicate that the motion had been set for hearing or submission or was otherwise before the court at that time. EcoProduct did not file a motion for continuance of the summary judgment hearing to allow it more time to obtain a hearing on or submission of its motion to compel arbitration. But its motions to dismiss each contained this sentence: “Should the Court determine jurisdiction is proper to determine the merits of [ENGlobal’s and Swenson’s motions for summary judgment], we ask [] the Court for an abatement of this motion until such time [as] proper relief is sought through AAA.” In the prayer of the motions to dismiss, EcoProduct asked the court to compel arbitration in the pending arbitration against Swenson. EcoProduct did not otherwise respond to Swenson’s and ENGlobal’s motions for summary judgment.

On January 22, the trial court conducted a hearing on the summary judgment motions. EcoProduct asserts that the hearing included a discussion of procedural issues concerning EcoProduct’s petition, the status of the pending arbitration, and EcoProduct’s motion to dismiss, as well as ENGlobal’s and Swenson’s motions for summary judgment. We do not have a record of the hearing.

One week later, the trial court granted ENGlobal’s and Swenson’s motions for summary judgment. EcoProduct moved for reconsideration, arguing that summary judgment was improper because the court was required to rule on the motion to compel arbitration before ruling on the motions for summary judgment and, alternatively, that the summary judgment was substantively erroneous on various grounds. In the prayer of its motion to reconsider, EcoProduct asked the trial court to deny the motions for summary judgment and compel ENGlobal to join the pending arbitration against Swenson.

In May, the trial court entered a final take-nothing judgment against EcoProduct, denying EcoProduct’s request for reconsideration and reaffirming his previous grant of ENGlobal’s and Swenson’s summary judgment motions. The final judgment did not address EcoProduct’s motion to compel arbitration. The judgment expressly stated that it was final and “disposes of all claims and all parties, and is appealable.” See Lehmann v. Har-Con Corp., 39 S.W.3d 191, 191–204 (Tex. 2001) (stating that such language unequivocally expresses trial court’s intention that judgment be final). This appeal ensued.

Standard of Review

We review a trial court’s decision to grant summary judgment de novo. Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009); Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). A party moving for traditional summary judgment bears the burden of demonstrating that no genuine issue of material fact exists, and it is entitled to judgment as a matter of law. Tex. R. Civ. P. 166a(c); KPMG Peat Marwick v. Harrison Cnty. Hous. Fin. Corp., 988 S.W.2d 746, 748 (Tex. 1999). A defendant may satisfy this burden by conclusively negating at least one element of the plaintiff’s claims or by establishing all elements of an affirmative defense. Diversicare Gen. Partner, Inc. v. Rubio, 185 S.W.3d 842, 846 (Tex. 2005); KPMG Peat Marwick, 988 S.W.2d at 748. Once the movant satisfies its burden, the burden shifts to the non-movant to raise an issue of material fact precluding summary judgment. Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex. 1995). When a party files a no-evidence summary judgment motion on claims on which the nonmovant bears the burden of proof at trial, the nonmovant bears the burden of presenting evidence sufficient to raise an issue of fact with respect to each element of its claims challenged in the summary judgment motion. Tex. R. Civ. P. 166a(i); Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 582 (Tex. 2006).

We review the evidence in the light most favorable to the nonmovant, crediting evidence favorable to the nonmovant if reasonable jurors could and disregarding contrary evidence unless reasonable jurors could not. Fielding, 289 S.W.3d at 848; City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). When, as here, the trial court’s summary judgment order does not state the basis for the trial court's decision, we must uphold the order if any of the theories advanced in the motion is meritorious. Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 216 (Tex. 2003). “Issues not expressly presented to the trial court by written motion, answer or other response shall not be considered on appeal as grounds for reversal.” Tex. R. Civ. P. 166a(c).

We review the denial of a motion to compel arbitration for abuse of discretion. In re D. Wilson Constr. Co., 196 S.W.3d 774, 780 (Tex. 2006) (orig. proceeding); Walker v. Packer, 827 S.W.2d 833, 839 (Tex. 1992) (orig. proceeding). A trial court abuses its discretion when it acts arbitrarily or unreasonably and without reference to any guiding rules or principles. See Walker, 827 S.W.2d at 839–40. Because a trial court has no discretion in determining what the law is or how to apply the law, we review this category of discretionary rulings de novo. See id. at 840.

Whether a party has waived its right to arbitration is a question of law, which we review de novo. In re Fleetwood Homes, L.P., 257 S.W.3d 692, 694 (Tex. 2008) (orig. proceeding); Perry Homes v. Cull, 258 S.W.3d 580, 591–93 (Tex. 2008); Williams Indus., Inc. v. Earth Dev. Sys. Corp., 110 S.W.3d 131, 135 & n.4 (Tex. App.—Houston [1st Dist.] 2003, no pet.). The party opposing arbitration on the basis of waiver has the burden to prove waiver. See In re Fleetwood Homes, 257 S.W.3d at 695 (“Because [real party in interest] has failed to show that Fleetwood waived its contractual right to arbitration, we conditionally grant Fleetwood’s petition for writ of mandamus and direct the trial court to compel arbitration.”); In re Multifuels, L.P., No. 01-09-00475-CV, 2010 WL 1981570, at *6 (Tex. App.—Houston [1st Dist.] May 7, 2010, no pet.).

Ruling on Summary Judgment Motions Before

Ruling on Motion to Compel Arbitration

In its first and second issues, EcoProduct contends that the trial court erred in granting Swenson’s and ENGlobal’s motions for summary judgment before ruling on EcoProduct’s motion to compel arbitration. The record does not reflect that the motion to compel was set for hearing or submission, and EcoProduct does not assert that the trial court delayed in ruling on the motion to compel, which was filed the week before the summary judgment hearing. Nor did EcoProduct request a continuance of the summary judgment hearing to allow time for adjudication of the motion to compel.[3] EcoProduct’s position on appeal is that, once it filed its motion to compel arbitration, the trial court was bound to rule on that motion before reaching any other motion.[4] The parties dispute whether the trial court reached the motion to compel arbitration. EcoProduct contends that the trial court did not reach the motion and requests that we reverse the final judgment and remand the case to the trial court for a ruling on the motion to compel arbitration. Swenson and ENGlobal contend that the trial court implicitly overruled the motion to compel arbitration.

To prevail in its appeal, EcoProduct must demonstrate both that the trial court erred and that the trial court’s error probably caused the rendition of an improper judgment or prevented EcoProduct from properly presenting its appeal—EcoProduct must establish harmful error. Tex. R. App. P. 44.1 (prohibiting courts of appeals from reversing a trial court’s judgment where error did not result in the necessary harm). Here, even if we assume that that the trial court erroneously ruled on the motions for summary judgment before reaching EcoProduct’s motion to compel, EcoProduct fails to demonstrate that this alleged error probably caused the rendition of an improper judgment or prevented it from properly presenting this appeal. Cf. id.; Vickery v. Vickery, 999 S.W.2d 342, 351 (Tex. 1999); Boston Invs. Group, Inc. v. Three Arch Capital, No. 01-08-00852-CV, 2011 WL 2089636, at *5 (Tex. App.—Houston [1st Dist.] May 19, 2011, no. pet. h.); Hot-Hed, Inc. v. Safehouse Habitats (Scotland), Ltd., 333 S.W.3d 719, 735 (Tex. App.—Houston [1st Dist.] 2010, pet. filed).

Specifically, EcoProduct would have been sufficiently harmed by the trial court’s purportedly ruling on the motions for summary judgments prior to the motion to compel only if EcoProduct was entitled to prevail on its motion to compel arbitration. See Tex. R. App. P. 44.1 (declaring that error can result in reversal only if it probably resulted in improper judgment or prevented adequate review by appellate court).  EcoProduct fails to establish that it was entitled to prevail on its motion to compel. Although EcoProduct cites to Section 171.021 of the Civil Practices and Remedies Code for the general proposition that the trial court must compel arbitration once a party establishes that there is an enforceable arbitration agreement that covers the claims at issue, it does not attempt to establish that it satisfied the requirements of this statute. See Tex. Civ. Prac. & Rem. Code Ann. § 171.021(b) (West 2005). Section 171.021 requires a party seeking an order compelling arbitration to make an initial showing that (1) there is an agreement to arbitrate, and (2) the other party refuses to arbitrate. Id. § 171.021(a). EcoProduct has not attempted to show that ENGlobal refuses to arbitrate; it asserts only that ENGlobal had not consented to be joined in the pending arbitration against Swenson. Swenson is participating in an ongoing arbitration with EcoProduct and clearly does not refuse to arbitrate.

Additionally, EcoProduct fails to demonstrate that it was entitled to the relief it requested in its motion to compel. EcoProduct did not request an order compelling the parties to arbitrate; it specifically requested an order that its claims against both ENGlobal and Swenson be arbitrated together in the pending arbitration against Swenson—relief which the AAA declined to grant. EcoProduct provides us with no legal authority demonstrating that it is entitled to the joint arbitration it requested in its motion (or the partially-joined arbitration it requested in the alternative), rather than separate arbitrations consistent with the AAA’s preliminary determination.[5] To the contrary, EcoProduct admits that there is no provision in the parties’ contracts providing for joint arbitration. We may not rewrite the parties’ arbitration agreement. See In re Merrill Lynch Trust Co. FSB, 235 S.W.3d 185, 191 (Tex. 2007) (refusing to allow affiliates of party to arbitration agreement to compel arbitration because doing so would “effectively rewrite their contracts”); J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 231 (Tex. 2003) (declining to rewrite contract to make arbitration provision unambiguous and enforceable); see also Tenneco Inc. v. Enterprise Prods. Co., 925 S.W.2d 640, 646 (Tex. 1996) (stating that “courts will not rewrite agreements to insert provisions parties could have included or to imply restraints for which they have not bargained”).

Nor has EcoProduct provided us with any authority suggesting that the trial court had the authority or obligation to overrule a decision made by the AAA with respect to preliminary procedural aspects of an AAA arbitration or to dictate the actions of the AAA, a non-party, rather than the actions of the litigants. By contrast, the parties’ contracts dictate that the arbitrations will be governed by the AAA’s procedures for commercial arbitrations, and the statute relied on by EcoProduct specifically authorized the trial court to order “the parties” to arbitrate. Tex. Civ. Prac. & Rem. Code Ann. § 171.021(b) (“A court shall order the parties to arbitrate on application of a party showing that . . .”).

We therefore conclude that, even accepting as true EcoProduct’s contention that the trial court ruled on Swenson and ENGlobal’s motions for summary judgment before ruling on EcoProduct’s motion to compel arbitration and erred in doing so, EcoProduct has failed to establish that it suffered harm as a result of this alleged error. See Tex. R. App. P. 44.1 (establishing harm as a prerequisite for reversal of a trial court’s judgment).

Waiver of Arbitration Rights

          In its third issue, EcoProduct argues that it has not waived its right to arbitrate.[6] Because an agreement to arbitrate is simply a matter of contract between the parties, the right to arbitrate can be waived if the parties agree to resolve their dispute in court. Perry Homes, 258 S.W.3d at 593. A strong presumption exists against waiver, however, and “[a]ny doubts regarding waiver are resolved in favor of arbitration.” Williams Indus., 110 S.W.3d at 135 (citing In re Bruce Terminix, 988 S.W.2d 702, 705 (Tex. 1998)); see In re D. Wilson Constr., 196 S.W.3d at 783; Perry Homes, 258 S.W.3d at 589–90. The burden to establish waiver is a heavy one. Bruce Terminix Co., 988 S.W.2d at 704–05.

Although EcoProduct asserts that it has not waived its right to arbitrate, it does not specify how this issue impacts the trial court’s judgment. EcoProduct does not assert that the trial court erroneously denied its motion to compel arbitration; to the contrary, EcoProduct’s position is that the trial court declined to rule on the motion. The issue of waiver would be implicated with respect to EcoProduct’s first and second issues on appeal, discussed above, if EcoProduct had established that it was otherwise entitled to prevail on its motion to compel arbitration. But we have determined above that EcoProduct did not establish that it was entitled to prevail on its motion to compel arbitration, regardless of any waiver of the right to arbitrate. A court of appeals need not reach issues that, in light of the court’s holding on other issues in the appeal, will not affect the disposition of the case. E.g., Ed Rachal Found. v. D’Unger, 207 S.W.3d 330, 334 n.2 (Tex. 2006); Browning v. Prostok, 165 S.W.3d 336, 351 (Tex. 2005). We therefore do not reach the issue of waiver.

Summary Judgments

In its final issue on appeal, EcoProduct attacks summary judgment in favor of Swenson and ENGlobal on a number of substantive grounds.

1.       Summary judgment in favor of ENGlobal

EcoProduct’s claims against ENGlobal were for breach of contract, breach of warranty, negligent misrepresentation, fraud and promissory estoppel. The four-year statute of limitations applies to claims for breach of contract, fraud, and promissory estoppel, and the two-year statute of limitations applies to claims for negligent misrepresentation. See Tex. Civ. Prac. & Rem. Code Ann. §§ 16.004, 16.051 (West 2002); Hyundai Motor Co. v. Rodriguez, 995 S.W.2d 661, 668 (Tex. 1999) (four-year statute of limitations applies to claim for breach of warranty); HECI Exploration Co. v. Neel, 982 S.W.2d 881, 885 (Tex. 1998) (two-year statute of limitations applies to claim for negligent misrepresentation; four-year statute applies to claim for breach of implied contractual covenants); Ambulatory Infusion Therapy Specialist, Inc. v. N. Am. Adm’rs, Inc., 262 S.W.3d 107, 119 (Tex. App.—Houston [1st Dist.] 2008, no pet.) (four-year statute of limitations applies to claims for breach of contract and promissory estoppel).

Generally, a cause of action accrues, and the statute of limitations begins to run, when facts come into existence that authorize a party to seek a judicial remedy, regardless of whether the party is aware of such facts. Provident Life, 128 S.W.3d at 221 (citing Johnson & Higgins of Tex., Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 514 (Tex. 1998)); Ambulatory Infusion Therapy Specialist, Inc. v. N. Am. Adm’rs, Inc., 262 S.W.3d 107, 119 (Tex. App.—Houston [1st Dist.] 2008, no pet.). When applicable, the discovery rule will toll the statute of limitations such that it does not begin to run until the date on which the claimant knew or reasonably should have known of the facts giving rise to its cause of action. Barker v. Eckman, 213 S.W.3d 306, 312 (Tex. 2006). The discovery rule is a defense to the affirmative defense of statute of limitations, and it must be pled and proved by the party seeking to invoke it. Id.; Woods v. William M. Mercer, Inc., 769 S.W.2d 515, 518 (Tex. 1988). To prove application of the discovery rule, a party must establish that its injury is both inherently undiscoverable and objectively verifiable. Barker, 213 S.W.3d at 312.

The gravamen of EcoProduct claims against ENGlobal is that ENGlobal’s work on the plant did not comply with ENGlobal’s contractual obligations or its alleged representations and warranties regarding the work.[7] ENGlobal’s summary judgment motion included evidence that all of ENGlobal’s work on the plant was completed no later than August 2005 and the parties met in May 2005 to discuss EcoProduct’s concerns regarding ENGlobal’s performance. By establishing that the allegedly deficient work was finished by August 2005, ENGlobal met its initial burden of showing the date from which limitations ran and that this date was more than four years before EcoProduct filed this action. See Rubio, 185 S.W.3d at 846 (party moving for summary judgment on affirmative defense of limitations meets burden by demonstrating date of accrual and expiration of applicable limitations period); KPMG Peat Marwick, 988 S.W.2d at 748 (same). The burden then shifted to EcoProduct to raise an issue of fact precluding summary judgment on the basis of limitations. Centeq Realty, 899 S.W.2d at 197 (“Once the defendant produces sufficient evidence to establish the right to summary judgment, the plaintiff must present evidence sufficient to raise a fact issue.”). EcoProduct contends that it raised such an issue of fact on two alternative grounds.

First, EcoProduct contends that the applicable limitations period for all of its claims is four years; its contract with ENGlobal was entered into on November 3, 2004; and it brought suit on October 21, 2008, within four years of the date of contracting. In support of its contention that it brought suit on October 21, 2008, EcoProduct cites to the amended statement of claims EcoProduct attempted to file in the arbitration proceeding against Swenson to add ENGlobal to that proceeding, which the AAA did not accept. EcoProduct did not pay the AAA filing fee for an arbitration at that time. EcoProduct provides no legal authority for the proposition that the attempted filing of an unaccepted arbitration document substitutes for commencement of litigation or otherwise tolls limitations. Cf. Sun v. Al’s Formal Wear of Houston, Inc., No. 14–96–01516–CV, 1998 WL 726479, at *4 (Tex. App.—Houston [14th Dist.] Oct. 15, 1998, no pet.) (not designated for publication) (holding that limitations expired and was not tolled by petition to enforce invalid arbitration award). We decline to adopt such a rule here. The appellate record establishes that EcoProduct filed this suit the following year, in October 2009, nearly five years after November 3, 2004.

Second, EcoProduct asserts that its claims did not accrue until 2006, when the “actual start up of the evaporator system” took place, because that is when it had notice of the facts giving rise to its claim. As noted above, unless the discovery rule applies, the limitations period runs from when the facts giving rise to a claim come into existence, not when the party has notice of those facts. Stine v. Stewart, 80 S.W.3d 586, 592 (Tex. 2002); Computer Assocs. Int’l, Inc. v. Altai, Inc., 918 S.W.2d 453, 461 (Tex. 1996). EcoProduct did not plead the discovery rule and has not put forth evidence establishing its application to this case. Cf. Barker, 213 S.W.3d at 312 (party invoking discovery rule must prove its application); Woods, 769 S.W.2d at 518 (discovery rule defense is waived if not pled). The evidence cited by EcoProduct is an affidavit it filed in its arbitration against Swenson, which is in the record among the exhibits to Swenson’s summary judgment motion. This affidavit addresses whether Swenson complied with its standard of care in performing engineering services for EcoProduct. While the affidavit does note that “[i]n 2006, the evaporators were started up and immediately began experiencing problems,” it does not address any problems with ENGlobal’s work, does not assert that EcoProduct did not know and reasonably should not have known of any problems with ENGlobal’s work before the start-up date, and does not attempt to establish that EcoProduct’s injury was inherently undiscoverable or objectively verifiable. Cf. Barker, 213 S.W.3d at 312 (criteria for application of discovery rule). EcoProduct has therefore failed to raise an issue of fact on its discovery rule defense to limitations.

2.       Summary judgment in favor of Swenson

With respect to Swenson’s motion for summary judgment, EcoProduct contends: (a) Swenson’s motion contains allegations of defective pleadings, which EcoProduct should have been permitted to cure by amendment; (b) the no-evidence portion of the motion was premature because adequate time for discovery had not elapsed; and (c) Swenson’s statute of limitations argument “completely ignor[es] the fact that EcoProduct filed a Demand for Arbitration on August 15, 2008,” and with respect to negligence, EcoProduct had up to ten years to file suit against an engineer for an alleged design defect that was undiscoverable.

          a.       Pleadings defects

EcoProduct asserts that Swenson’s summary judgment motion contains allegations of defective pleadings and that the trial court erred by failing to allow it an opportunity to replead. EcoProduct does not specify which allegations in Swenson’s summary judgment motion constitute allegations of pleadings defects or how EcoProduct might have cured the alleged defect by repleading.  In our review of Swenson’s motion for summary judgment, we found substantive arguments for summary judgment on each of EcoProduct’s claims against Swenson.[8] Because it is not evident from the record that Swenson obtained summary judgment on the basis of pleadings defects, and because EcoProduct has not provided us with any specific arguments in this respect, we hold that EcoProduct has waived this issue. See Tex. R. App. P. 38.1(i); Humble Emergency Physicians, P.A. v. Mem’l Hermann Healthcare Sys., Inc., No. 01-09-00587-CV, 2011 WL 1584854, at *8 (Tex. App.—Houston [1st Dist.] Apr. 21, 2011, no. pet. h.); San Saba Energy, L.P. v. Crawford, 171 S.W.3d 323, 338 (Tex. App.—Houston [14th Dist.] 2005, no pet.).

b.      Premature no-evidence motion for summary judgment

EcoProduct asserts that it had less than four months to conduct discovery and that this period of time does not satisfy Rule 166a(i)’s prerequisite for an adequate time for discovery before the filing of any no-evidence summary judgment motion. See Tex. R. Civ. P. 166a(i). But EcoProduct fails to establish that it preserved this issue for review. To preserve a complaint for appellate review, a party must show that the record demonstrates that (1) the party timely made the trial court aware of its complaint and the basis of the complaint in a manner that complied with the rules of evidence and procedure and (2) the trial court ruled on the complaint or refused to rule over the objection of the complaining party. Tex. R. App. P. 33.1.

EcoProduct fails to cite to any place in the record where it raised this issue before the trial court and requested more time for discovery from the trial court in compliance with the rules of procedure. See Tex. R. App. P. 38.1(i) (requiring that appellate arguments must be supported by appropriate citations to the record); see also Elliott v. West, No. 01–09–00425–CV, 2011 WL 1233434, at *2 (Tex. App.—Houston [1st Dist.] Mar. 31, 2011, no pet.) (noting that a party complaining that more time was needed to respond to a summary judgment motion must “request more time from the trial court and support that request with either affidavit testimony establishing the need for more time or a verified motion for continuance.”); see also Tex. R. Civ. P. 166a(g); Tex. R. Civ. P. 251, 252). EcoProduct has therefore waived this complaint.

c.       Limitations

One of Swenson’s asserted grounds for summary judgment is that EcoProduct’s negligence claims are barred by the statute of limitations. This ground for summary judgment relates only to EcoProduct’s negligence claims. Swenson also asserted another ground for summary judgment on EcoProduct’s negligence claims: that EcoProduct’s negligence claims sounded in breach of contract but not in tort. See Sw. Bell Tel. Co. v. DeLanney, 809 S.W.2d 493, 494 (Tex. 1991) (explaining that when injury suffered is to subject matter of contract, claimant’s action ordinarily sounds only in contract and not in tort). The trial court’s judgment does not specify which ground was the basis for its summary judgment on EcoProduct’s negligence claims.

When an appellant fails to challenge—either specifically or through a broad Malooly challenge[9]—one or more grounds upon which the trial court’s summary judgment may be affirmed, a court of appeals must affirm the trial court’s judgment without considering whether the judgment was proper or improper on the unchallenged grounds. Ellis v. Precision Engine Rebuilders, Inc., 68 S.W.3d 894, 898 (Tex. App.—Houston [1st Dist.] 2002, no pet.) (“If summary judgment may have been rendered, properly or improperly, on a ground not challenged, the judgment must be affirmed.”); Am. Nat’l Ins. Co. v. Deutsche Bank Sec., No. 01-08-00791-CV, 2009 WL 1562960, at *2 (Tex. App.—Houston [1st Dist.] June 4, 2009, no pet.) (mem. op.) (holding summary judgment must be affirmed when one possible basis for judgment not challenged on appeal); Lowry v. Liberty Lloyds of Tex. Ins. Co., No. 01-07-00796-CV, 2008 WL 5178729, at *1 (Tex. App.—Houston [1st Dist.] Dec. 11, 2008, no pet.) (mem. op.) (same). Because the trial court could have granted summary judgment on EcoProduct’s negligence claims against Swenson on the unchallenged ground that the claims sounded only in contract, we must affirm the trial court’s judgment with respect to the negligence claim.

Conclusion

With respect to EcoProduct’s contention that the trial court erred by ruling on the motions for summary judgment before reaching EcoProduct’s motion to compel arbitration, we conclude that EcoProduct has failed to establish that this alleged error was harmful. With respect to EcoProduct’s substantive challenge to the summary judgment in favor of ENGlobal, we hold that ENGlobal met its summary judgment burden of establishing that the applicable statutes of limitations on EcoProduct’s claims against it ran before EcoProduct filed suit, and EcoProduct failed to raise an issue of fact precluding summary judgment. With respect to EcoProduct’s substantive challenges to the summary judgment in favor of Swenson, we conclude that EcoProduct has waived its complaints based on whether Swenson raised pleading defects and whether the no-evidence portion of Swenson’s motion for summary judgment was premature; we further conclude that the summary judgment on EcoProduct’s negligence claim against Swenson can be affirmed on an unchallenged ground and therefore do not reach EcoProduct’s challenge to the statute of limitations ground for summary judgment on that claim.

We affirm the trial court’s judgment.

                                                                   Harvey Brown

                                                                   Justice

Panel consists of Justices Keyes, Higley and Brown.

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[1]           EcoProduct asserted its DTPA claims against Swenson only.

[2]           In the text of the motions to dismiss, EcoProduct indicated that the motions were responses to Swenson’s and ENGlobal’s motions for summary judgment.

[3]           EcoProduct did ask in its motions to dismiss the summary judgment motions that, if the trial court determined that “jurisdiction was proper to determine the merits” of the summary judgment motions, the trial court abate “this motion until such time [as] the proper relief is sought through AAA.” This is not sufficient to request a continuance of the summary judgment hearing until after the motion to compel arbitration has been adjudicated. Moreover, the record does not reflect that EcoProduct ever set its motions to dismiss the summary judgment motions for hearing or submission.

[4]           In support of this position, EcoProduct cites two cases that do not involve summary judgment motions or otherwise address the order in which the trial court should rule on motions. See Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 218, 105 S. Ct. 1238, 1241 (1985) (holding lower court erred in denying motion to compel arbitration even though result would be maintenance of two separate proceedings in separate forums); USX Corp. v. West, 781 S.W.2d 453, 455 (Tex. App.—Houston [1st Dist.] 1989, no writ) (holding that trial court erred in denying motion to compel arbitration as to some claims when other claims relating to same controversy had already been sent to arbitration).

[5]           ENGlobal and Swenson contend that, consistent with the AAA’s ruling, nothing in their contracts with EcoProduct or the applicable AAA procedures provides for such joint arbitration under the circumstances of this case. EcoProduct acknowledges that AAA rules do not contain any applicable consolidation rule. By agreeing to arbitrate under the AAA rules, the parties agreed to arbitrate without such a rule.

[6]           The parties do not address whether their arbitration provisions in their contracts are governed by the Federal Arbitration Act (“FAA”) of the Texas Arbitration Act (“TAA”), and the provisions are silent in this respect. When a trial court denies a motion to compel arbitration, appellate review may be available under both the TAA and the FAA so long as the TAA is not preempted. Ellis v. Schlimmer, No. 10–0243, 2011 WL 1206378, at *1 (Tex. April 1, 2011). The TAA is preempted only when it or other state law would not allow enforcement of an arbitration agreement that the FAA would enforce. Id.   A party arguing that the TAA is preempted bears the burden of proof on that issue. Id. at *2. Because no party has met that burden here, we assume that both the TAA and FAA are available to the parties. Regardless, the standard for determining waiver is the same under both the FAA and the TAA. Sedillo v. Campbell, 5 S.W.3d 824, 826 (Tex. App.—Houston [14th Dist.] 1999, no pet.); SEB, Inc. v. Campbell, No. 03–10–00375–CV, 2011 WL 749292, at *5 (Tex. App.—Austin Mar. 2, 2011, no pet.) (mem. op.).

[7]           The damages EcoProduct sought to recover with respect to ENGlobal begin with “the amount [EcoProduct] paid to ENGlobal” for its work on the plant. 

[8]           Some of the labels on Swenson’s summary judgment arguments assert that EcoProduct failed to state an actionable claim, but the arguments under the label are substantive legal arguments. In connection with Swenson’s motion for no-evidence summary judgment on EcoProduct’s breach of contract claim, Swenson notes that EcoProduct failed to plead that it had tendered performance on the parties’ contract, but its request for summary judgment is also based on the absence of any evidence of performance.

[9]           Under Malooly Bros., Inc. v. Napier, an appellant may assert broadly on appeal that the trial court erred by rendering summary judgment. 461 S.W.2d 119, 121 (Tex. 1970). In such an appeal, however, the appellant still must present arguments and support them with authority and record citations in order to merit reversal. See McCoy v. Rogers, 240 S.W.3d 267, 272 (Tex. App.—Houston [1st Dist.] 2007, pet. denied).