2020 Environmental Real Estate Issues

A Texas (mid-level) Court of Appeals reinstated a negligence case brought against two environmental engineering firms. Neighbors of a site being remediated alleged that the firms, which provided environmental engineering services and submitted reports to the Texas Commission on Environmental Quality (TCEQ) on behalf of the site’s owner, were negligent and the cause of damages.

COM Required for Suit against Registered Professionals
The district (trial level) court had dismissed the case, finding that the certificate of merit (COM) filed on behalf of the neighbors was inadequate. Texas law requires filing of a COM in suits for damages arising out of the provision of services by a registered professional. The COM must be by a person holding the same registration that practices in the same area.

Inadequate Site Model
A key allegation in the COM was that the firms failed to develop a reliable conceptual site model (CSM) of the site’s hydrogeologic features, which led to the continuing spread of an underground plume and damage to the neighbors. The COM said that both firms had data to update the CSM, but the CSM “does not appear to have changed to any degree since the mid-1990’s.”
Low Standard for COM Adequacy

The firms’ arguments included that the COM failed to identify how each firm was negligent and failed to consider key documents submitted to TCEQ. The Court held the COM adequately identified the individual firm’s failures, specifically identified areas where both firms acted unreasonably, and provided adequate support to show the neighbors’ claims were not frivolous. The Court noted that the requirements for a COM were far lower than for admissibility, and the firms could raise many of their arguments through motions to strike expert testimony or for summary judgment.

To read the opinion https://search.txcourts.gov/