# Third Coast Servs., LLC v. Castaneda

Supreme Court of Texas, No. 23-0848

**Third Coast Servs., LLC v. Castaneda, No. 23-0848 (Tex. Dec. 12, 2025). Holding: Section 97.002 does not require privity with TxDOT; the contractors conclusively established that they worked "for" TxDOT because TxDOT would ultimately bear responsibility for operating and maintaining the frontage roads on which they worked, and that installing traffic signals is construction or repair of a "highway"; the remaining element, compliance with contract documents, was remanded to the court of appeals.**

Practice areas: construction law, personal injury

## Key issues

- Civil Practice and Remedies Code § 97.002, which extinguishes liability of a contractor that constructs or repairs a highway, road or street "for" TxDOT and complies with contract documents material to the defect, does not require contractual privity with TxDOT, and the court of appeals erred by engrafting one onto the text.
- The contractors conclusively established that they worked "for" TxDOT because TxDOT would bear responsibility for operating and maintaining the frontage roads they worked on, and that installing traffic signals is construction or repair of a "highway"; the remaining element, contract compliance, was remanded to the court of appeals.

## Factual History
Pedro Castaneda was driving across State Highway 249 at Woodtrace Boulevard when two vehicles collided with his truck at an intersection under construction where traffic lights had been installed but were not yet operational (Opinion, PDF p. 2). The parties dispute whether the lights were covered with black fabric to show they were not working, and the police report says Castaneda failed to yield at the stop sign that controlled the intersection (Opinion, PDF p. 2). After the Transportation Commission designated part of SH 249 as a future toll facility, TxDOT and Montgomery County (through its Toll Road Authority) agreed that the County would "finance, acquire right-of-way, design, construct, maintain, and operate" the southern "County Project," with plans submitted to TxDOT for review and approval and built to TxDOT standards, while TxDOT would be responsible for "the operation and maintenance of the frontage roads that are adjacent to the County Project" (Opinion, PDF pp. 2-4). The County hired SpawGlass Civil Construction, Inc. as general contractor, and SpawGlass hired Third Coast Services, LLC as a subcontractor to furnish and install electrical components, including traffic signals (Opinion, PDF p. 4).

## Procedural History
Castaneda's family sued, and SpawGlass and Third Coast moved for summary judgment on the defense in Civil Practice and Remedies Code section 97.002; the trial court denied the motions, and the contractors took an interlocutory appeal under section 51.014(a)(17) (Opinion, PDF pp. 2, 5). The Fourteenth Court of Appeals affirmed, holding that the statute "applies only to contractors hired by TxDOT," rejecting the First Court of Appeals' contrary decision in *Mahoney v. Webber*, and not reaching Castaneda's alternative arguments (Opinion, PDF pp. 5-6). Each contractor petitioned for review on December 15, 2023; the Court granted review on April 4, 2025, heard argument on September 9, 2025, and decided the case on December 12, 2025, with Justice Lehrmann not participating (Docket; Opinion, PDF pp. 1, 15).

## Issues Presented
Third Coast presents what it means to be a "contractor who constructs or repairs . . . for" TxDOT, including whether the statute requires direct privity, and what it means to construct or repair "a highway, road, or street," including installing a traffic signal (Brief on the Merits (Third Coast Services, LLC), PDF p. 14; Petition for Review (Third Coast Services, LLC, et al), PDF p. 11). SpawGlass presents whether a contractor must contract directly with TxDOT, whether it conclusively established that it constructed or repaired a highway for TxDOT, whether it established the remaining elements, and whether the trial court erred in overruling its objections to a declaration (Brief on the Merits (SpawGlass Civil Construction, Inc), PDF p. 19; Petition for Review #2 (SpawGlass Civil Construction, Inc), PDF p. 14). The Court decided whether privity is required, whether the contractors worked "for" TxDOT, and whether their work was construction or repair of a "highway," and remanded the compliance element (Opinion, PDF pp. 2, 6-7, 12-14).

## Standard(s) of Review
Section 97.002 is an affirmative defense, so to obtain summary judgment the contractors must conclusively establish each of its requirements (Opinion, PDF pp. 6-7). Statutory interpretation is a question of law reviewed de novo, beginning with the text and presuming the Legislature chose its words with care (Opinion, PDF p. 7).

## Legal Arguments
**Whether section 97.002 requires privity with TxDOT and whether the contractors worked "for" TxDOT.**

**Petitioners (Third Coast and SpawGlass):** The statute's "for" indicates the aim or purpose of the work, not privity; Third Coast, the electrical subcontractor, installed a traffic signal according to TxDOT's specifications, and SpawGlass's contract required it to construct a highway for TxDOT because the SH 249 frontage roads remained part of the state highway system (Brief on the Merits (Third Coast Services, LLC), PDF p. 29; Brief on the Merits (SpawGlass Civil Construction, Inc), PDF p. 32). They also argue that the statute extends to all contractors in the chain of contracts on a project, as the First Court held in *Mahoney*, and that installing traffic signals is construction or repair of a road (Brief on the Merits (Third Coast Services, LLC), PDF p. 14; Petition for Review (Third Coast Services, LLC, et al), PDF p. 23).

**Respondents (Castaneda):** Under a plain-language reading and legislative history, section 97.002 requires a contractual relationship with TxDOT, and there was none; TxDOT expressly relinquished control of the County Project to Montgomery County and removed it from the state highway system, so the contractors worked only for the County; and adding traffic signals to an existing highway is not "construction" of a highway, so the accident did not arise from the construction or repair of a highway (Brief on the Merits (Felicitas Castaneda, et al), PDF p. 9; Response to Petition (Felcitas Castaneda, et al), PDF p. 22; Opinion, PDF pp. 9-10, 12).

## Stated Reasons the Court Should Take the Case
The contractors argued that the case presents a clear split between the First and Fourteenth Courts of Appeals on whether section 97.002 requires privity, and that the Court had never construed the statute (Petition for Review (Third Coast Services, LLC, et al), PDF p. 23; Petition for Review #2 (SpawGlass Civil Construction, Inc), PDF p. 14). Third Coast added that the question affects hundreds of lawsuits and that, as amici explain, the decision below leaves contractors with much less protection than the Legislature intended (Reply to Response (Third Coast Services, LLC), PDF p. 4).

## Practice Area Tags
construction-law, personal-injury

## Procedural Posture/Vehicle
Petition for review from the Fourteenth Court of Appeals in an interlocutory appeal from the denial of summary judgment; argued September 9, 2025, and decided December 12, 2025 (Opinion, PDF pp. 1, 5-6, 15).

## Amicus Involvement
- [Associated General Contractors](https://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=90025d84-6ec9-4d34-9dc8-cdc7ab10e7ee&coa=cossup&DT=BRIEFS&MediaID=4125d68c-57c3-4b52-af20-1df3dff45f58) filed an amicus curiae brief on January 21, 2024, at the petition stage.
- [American Subcontractors Association](https://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=b95729be-53c4-4f02-af26-42062469a2c3&coa=cossup&DT=BRIEFS&MediaID=47f07221-d291-4cdc-881e-e46ed34145b5) filed an amicus curiae brief on February 1, 2024.
- [Rogers-O'Brien Construction, et al.](https://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=8a974721-63e3-4074-8161-51b82225cf39&coa=cossup&DT=BRIEFS&MediaID=c88900dc-6827-40db-9ae5-32e89417b521) filed an amicus curiae brief on February 2, 2024.

## Holding
Section 97.002 does not require privity with TxDOT; the contractors conclusively established that they worked "for" TxDOT because TxDOT would ultimately bear responsibility for operating and maintaining the frontage roads on which they worked, and that installing traffic signals is construction or repair of a "highway"; the remaining element, compliance with contract documents, was remanded to the court of appeals (Opinion, PDF pp. 2, 8-14).

## Court's Reasoning
**No privity.** Section 97.002's text applies to a contractor that "constructs or repairs a highway, road, or street for" TxDOT and nowhere limits it to contractors who contract directly with TxDOT; the Legislature expressly requires privity when it intends to, as in Transportation Code sections 474.003 and 472.021, and the Court agreed with *Mahoney* that privity is not required (Opinion, PDF p. 8).

**"For" TxDOT.** Dictionaries show that "for" means the result of the work will be received, owned, or used by the person it is "for," so one who contracts directly with TxDOT to build a state-owned road works for TxDOT, as do subcontractors hired for part of the work (Opinion, PDF p. 9). Castaneda's argument that TxDOT ceded control to the County fails because work "for" the County can also be "for" TxDOT; but the contractors' view that any project subject to TxDOT's review and specifications is for TxDOT proves too much, since almost any work on a public road would qualify (Opinion, PDF pp. 9-11). The Court did not define the precise line but held that the work here qualifies because the County and TxDOT agreed that TxDOT would bear responsibility for operating and maintaining the frontage roads, and the contractors' work was on the existing SH 249 lanes that would become those frontage roads, with Castaneda's own evidence acknowledging that the signals would be controlled by TxDOT after completion (Opinion, PDF p. 11).

**Highway.** The Transportation Code defines "highway" to include "a bridge, culvert, building, or other necessary structure related to a public road," which pertains to the physical function of the road, such as a guard rail; traffic signals likewise reduce the risks of travel and fall within it, and SpawGlass, as the general contractor bearing ultimate responsibility, "constructs" the project even if a subcontractor does the physical work (Opinion, PDF pp. 12-13 & n.2).

**Remand.** Whether the contractors conclusively established compliance with contract documents material to the defect, which Castaneda disputes in several respects, is a fact-intensive question that the Court remanded to the court of appeals (Opinion, PDF pp. 13-15).

## Disposition
The Court reversed the court of appeals' judgment and remanded the case to that court to consider whether SpawGlass and Third Coast conclusively established the remaining elements of section 97.002 (Opinion, PDF pp. 14-15).

## Vote Breakdown
Justice Huddle delivered the opinion of the Court; Justice Lehrmann did not participate in the decision (Opinion, PDF p. 1).


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Source: The SCOTX Report, https://scotxreport.com/cases/23-0848. AI-generated summary of the Court's opinion, orders and the parties' briefs, with pin cites to the page of each document; verify against the Court's own documents at search.txcourts.gov.