Fresh Coat, Inc. v. K-2, Inc.

Summary

The Supreme Court of Texas held that synthetic stucco is a product and that a contractor providing and installing it may qualify as a seller under Chapter 82 of the Texas Civil Practice and Remedies Code. The court concluded that the manufacturer's statutory duty to indemnify extended to the contractor's settlements with homeowners and the homebuilder, despite the contractor's separate contractual indemnity obligation to the homebuilder. The court affirmed in part, reversed in part, and rendered judgment for Fresh Coat consistent with the trial court's original judgment.

Holdings

1. EIFS is a product under Chapter 82 even when it is incorporated into a house wall or otherwise becomes part of real property.
2. A company that contracts to provide and install a product may be a seller under Chapter 82 even if it also provides installation services and does not sell only the product.
3. A manufacturer's statutory indemnity obligation is not eliminated merely because the seller is independently liable under a contract to indemnify another party.
4. K-2 failed to establish that Fresh Coat's settlement payment to Life Forms was caused by the type of culpable act or omission that triggers the statutory exception, so the payment was subject to Chapter 82 indemnity.

Questions Presented

1. Whether EIFS is a product under Chapter 82 of the Texas Civil Practice and Remedies Code.
2. Whether Fresh Coat, which provided and installed EIFS, is a seller under Chapter 82.
3. Whether Chapter 82 requires K-2 to indemnify Fresh Coat for Fresh Coat's settlement payment to Life Forms despite Fresh Coat's contractual indemnity obligation to Life Forms.
4. Whether the statutory exception for losses caused by the seller's negligence, intentional misconduct, or other culpable act or omission barred indemnity.

Disposition

other