CPRC 33.004(e) not applicable to vicariously liable defendants

Posted on April 2, 2010 by Byron Henry

The Houston (First) Court of Appeals recently held that section 33.004(e) of the Texas Civil Practice and Remedies Code does revive claims against defendants whose liability is solely vicarious.

Section 33.004(e) allows plaintiffs to join as defendants those designated as responsible third parties notwithstanding the applicable statute of limitations.  Plaintiffs in this case filed suit against Wells Fargo well after limitations had apparently expired.  Plaintiff then moved to join one of Wells Fargo's employees as a responsible third party.  After the court granted the motion, Plaintiff then joined the employee as a defendant.  Both Wells fargo and the employee sought summary judgment based on limitations and argued (1) that public policy barred the use of section 33.004(e) to circumvent limitations, (2) section 33.004(e) cannot revive claims on which the statute had run prior to enactment of Chapter 33, and (3) section 33.004(e) does not revive claims against parties who are only vicariously liable.

The court of appeals rejected the defendants' first argument as "without merit."  The court, however, agreed with the defendants that Chapter 33 cannot revive claims on which limitations had already expired prior to its passage.  Finally, the court held that a party that is only vicariously liable does not fit the definition of responsible third party in Chapter 33.  After reciting  the definition of responsible third party found in section 33.011(6), the court stated:

A party that is liable based purely on respondeat superior does not fit this definition.  The definition further underscores that section 33.004(e) should not be used to hold a party liable when no allegations have been made that the party caused or contributed to the claimant's damages.

The take home here is that employers whose liability is only vicarious cannot be designated "responsible third parties" under Chapter 33.  As a result, the court of appeals concluded that the plaintiffs' time-barred claims against Wells Fargo based on respondeat superior were not revived by section 33.004(e).  The court's opinion in Villareal v. Wells Fargo Brokerage Servs., LLC can be found at this link.

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Chapter 74 Statute of Limitations Trumps Chapter 33 Extension

Posted on January 2, 2009 by Byron Henry

The San Antonio Court of Appeals recently held that the two-year statute of limitations for health care liability claims in section 74.251 of the Civil Practice and Remedies Code cannot be extended by any other law, including section 33.004(e).  The Court focused on the unambiguous language of section 74.251 that the two-year statute applies "notwithstanding any other law."  Obviously, section 33.004(e) constitutes another law.  Consequently, the Court held that section 33.004(e) cannot be used to extend the two-year statute of limitations on health care liability claims.

Justice Simmons concurred and noted in her opinion that this ruling, while statutorily correct, creates an imbalance in the third-party designation practice created by the legislature and implored the legislature to correct the problem.  Justice Simmons' concerns are well-founded, especially since a defendant does not have to designate responsible third parties until very late in the case under section 33.004(a) (sixty days prior to trial date).  Assuming a plaintiff filed suit within one year of injury, a defendant's deadline to designate responsible third parties would almost certainly be later than two years after the plaintiff's injury.  As a result, claims against a designee joined by the plaintiff would be subject to the two-year statute  of limitations for health care liability claims.  As her concurrence explains:

The designation of responsible third parties within the proportionate responsibility framework developed by the Legislature was balanced. The defendant was given more latitude to designate time-barred responsible third parties and the claimant was given a counterbalancing right to join the designees in the suit. The application of section 74.251 to remove the plaintiff’s ability to join the designated responsible third party results in an imbalance in the framework. There is no deterrent to designating as many time-barred responsible third parties as possible, and no incentive for such designees to vigorously contest responsibility. In essence, the plaintiff is left in the position of having to prove the liability of the party defendant while at the same time defending the empty chair designees. The Legislature developed the proportionate responsibility framework with checks and balances to preclude such an unfair result, but it may not have considered the impact of section 74.251 which bars plaintiff’s statutory right to join a time-barred responsible third party in a health care liability case. Unfortunately for proportionate responsibility, without further clarification from the Legislature, there is no check and the balance is gone.

The Court's opinion in Kimbrell v. Molinet can be found at this link.  Justice Simmons' concurrence can be found at this link.

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