Section 150.002 of the Civil Practice and Remedies Code requires a plaintiff seeking damages arising from services rendered by a licensed professional (e.g., engineers, architects) to file with its original petition an expert affidavit showing its claim has merit. If a plaintiff does not file a complying affidavit, the court “shall” dismiss the claim, and the dismissal “may” be with prejudice.  In Pedernal Energy, LLC v. Bruington Engineering, No. 15-0123 (April 28, 2017), the Texas Supreme Court clarified what that means.

Pedernal sued an engineering firm for fracking operations gone bad, but did not file a certificate of merit with its original petition. When the engineering firm moved to dismiss due to the missing certificate, Pedernal nonsuited its claim.

Several months later, Pedernal reasserted its claim against the engineering firm, this time attaching a certificate of merit. The engineering firm again moved to dismiss, claiming that the court should not have granted the nonsuit without prejudice without hearing its motion to dismiss with prejudice under Section 150.002(e). The trial court denied the motion. The engineering firm filed an interlocutory appeal.

The court of appeals ruled that the trial court should have heard the engineering firm’s motion to dismiss rather than granting a nonsuit without prejudice. It reasoned that a plaintiff should not be able to circumvent the statute by nonsuiting and later amending.

On remand, the trial court found that Pedernal’s claim had merit and there was good cause for its failure to include the certificate with its original petition.

The engineering firm appealed again, arguing that the court abused its discretion by refusing to dismiss the claim with prejudice. The court of appeals agreed, concluding that the plaintiff should not be allowed to skirt an unfavorable ruling by nonsuiting and amending. The court of appeals reversed and dismissed the claim with prejudice.

Pedernal appealed arguing that the trial court had not abused its discretion because Pedernal established good cause for not including the certificate the first time and its claim had merit.

The supreme court analyzed the statutory language, concluding that Section 150.002(e) provided the trial court with discretion to determine whether to dismiss with or without prejudice. The court declined to adopt a “good cause” standard to determine whether the plaintiff failed to comply with the certificate of merit requirement because the court could not read into the statute a standard that the legislature did not include.

Instead, the supreme court reviewed the trial court’s decision for abuse of discretion using “various factors given the facts and circumstances of the particular case.” The court noted that the purpose of requiring a certificate was “to deter meritless claims and bring them quickly to an end.”

Given this goal, the supreme court held that the trial court did not abuse its discretion in denying the engineering firm’s second motion to dismiss with prejudice. The supreme court reasoned that, even though amendment cannot cure the failure to file a certificate of merit, the evidence presented at the hearing showed that Pedernal’s claim had merit at the time of the original filing. So the failure to file a certificate of merit was not evidence that the allegations lacked merit or that the sanction of dismissal was warranted. The supreme court held that in light of the trial court’s finding that the claim had merit, there was no ground for the court of appeals finding of abuse of discretion.

Although the supreme court acknowledged that its holding might “encourage lax attitudes towards the statute’s contemporaneous filing requirement,” it noted that this concern was not reflected in the language of the statute and thus was immaterial to the court’s inquiry into legislative intent.