# Lattimore Materials Corp. v. Trinity Indus. Leasing Co.

Supreme Court of Texas, No. 24-0953

**Lattimore Materials Corp. v. Trinity Indus. Leasing Co., No. 24-0953, is before the Supreme Court of Texas. Key issue: Does a claim under a railcar lease clause requiring the lessee to "reimburse promptly" for corrosion damage accrue when the corrosion occurs, or only when the lessee fails or refuses to reimburse the lessor's resulting losses?**

Practice areas: breach of contract

## Key issues

- Does a claim under a railcar lease clause requiring the lessee to "reimburse promptly" for corrosion damage accrue when the corrosion occurs, or only when the lessee fails or refuses to reimburse the lessor's resulting losses?

## Factual History
Lattimore Materials Corp., which operates an Oklahoma quarry and produces limestone aggregate and concrete, leased 226 railcars from Trinity Industries Leasing Company in 2009 (Brief on the Merits (Petitioner), PDF p. 17; Brief on the Merits (Respondent), PDF p. 17). Article 13 of the Railroad Car Lease Agreement says that if a car is "unduly and materially damaged, destroyed or depreciated in value or condition due to the corrosive . . . effect of any substance carried therein," the lessee must "reimburse [Trinity] promptly" for any "damage, loss, or expense suffered by Trinity as a consequence thereof" (Brief on the Merits (Petitioner), PDF p. 17). Lattimore washed the aggregate and loaded it, still wet, into the cars every day for about ten years, and the parties agree that this wet loading caused the corrosion (Brief on the Merits (Petitioner), PDF p. 17; Brief on the Merits (Respondent), PDF pp. 18-20). Trinity's inspection contractor reported corrosion as early as 2013, a joint inspection of two cars in June 2018 confirmed heavy corrosion, and in December 2018 Lattimore signed riders renewing the lease for three more years (Brief on the Merits (Petitioner), PDF pp. 18-21; Brief on the Merits (Respondent), PDF pp. 20-22). Lattimore says Trinity knew by early 2019 that all 226 cars needed a complete rebody costing about $13.5 million and hid that until after renewal, while Trinity says Lattimore had equal or superior knowledge and was told of the potential liability before it renewed (Brief on the Merits (Petitioner), PDF pp. 20-21; Brief on the Merits (Respondent), PDF pp. 21-22). Lattimore terminated the lease in early 2020, and Trinity sued six months later (Brief on the Merits (Petitioner), PDF p. 22; Brief on the Merits (Respondent), PDF pp. 25-26).

## Procedural History
Trinity sued for breach of Article 4 (rent) and Article 13 (reimbursement), and Lattimore pleaded limitations (Brief on the Merits (Petitioner), PDF p. 22). The jury found that Lattimore breached Article 13 and failed to reimburse Trinity for $9 million in losses, but it also found that Trinity knew or should have known of Lattimore's failure to comply with Article 13 by December 31, 2015, more than four years before suit (Brief on the Merits (Petitioner), PDF p. 22; Brief on the Merits (Respondent), PDF pp. 28-29). The trial court rendered a take-nothing judgment on the Article 13 claim as time-barred and awarded Trinity more than $2 million in rent and interest plus $3 million in attorney's fees on its separate Article 4 claim, which Lattimore did not appeal (Brief on the Merits (Petitioner), PDF p. 23). The Dallas Court of Appeals, in an opinion reported at 736 S.W.3d 19, unanimously reversed the limitations bar on Article 13, holding that "[d]amage to the railcars, of itself, was not a limitations triggering event" and that there was no evidence Trinity knew or should have known Lattimore would not reimburse it before Lattimore wrongfully terminated the lease in January 2020, and it rendered judgment for the additional $9 million (Brief on the Merits (Respondent), PDF p. 30; Brief on the Merits (Petitioner), PDF p. 24). The vehicle in this Court is a petition for review filed by Lattimore, which the Court granted on May 29, 2026, setting argument first for October 6 and then for October 8, 2026. After the parties reported on August 31, 2026, that they had settled, the Court granted their joint motion to abate on September 4, 2026, and removed the case from the active docket until October 15, 2026, when they must file a status report or a motion to dismiss.

## Issues Presented
Lattimore presents one issue (Petition for Review (Petitioner), PDF p. 11): whether the court of appeals erred in holding that no evidence supports the jury's date finding, when Lattimore agreed to "promptly" reimburse Trinity for damage, loss, or expense from railcar corrosion, a jury found that Trinity knew or should have known more than four years before suit that the cars had material corrosion damage and that Lattimore had not promptly reimbursed, and the court nonetheless held Trinity's claim could not accrue until Lattimore refused to reimburse it. Trinity frames the issue as whether the court of appeals correctly held that Lattimore breached Article 13 not when corrosion occurred but when it repudiated its duty to reimburse Trinity for consequences suffered from the corrosion (Brief on the Merits (Respondent), PDF p. 14). Trinity also presents an issue it describes as unbriefed: that because Lattimore used the cars continuously until it repudiated the lease and did not obtain a finding on the amount of damages outside limitations, the jury's date finding could not support a limitations bar (Response to Petition (Respondent), PDF p. 10).

## Legal Arguments
**When a claim under Article 13 accrued.**

**Lattimore (Petitioner):** Article 13 required Lattimore to "promptly" reimburse Trinity for any damage, loss, or expense caused by corrosion, including the immediate economic loss Trinity suffered when the cars were damaged, so Lattimore breached, and Trinity's claim accrued, when it failed to reimburse promptly; the court of appeals agreed that Trinity suffered immediate economic damage and that the reimbursement obligation arose when the corrosion occurred, but then read the word "promptly" out of the Lease (Brief on the Merits (Petitioner), PDF p. 25). Under *Cosgrove v. Cade* and *Archer v. Tregellas*, a claim accrues when a wrongful act causes some legal injury even if all damages have not yet occurred, and the court of appeals instead invented a "refusal" requirement found nowhere in the contract, which would let Trinity delay accrual indefinitely (Brief on the Merits (Petitioner), PDF pp. 14-15, 25; Petition for Review (Petitioner), PDF p. 19).

**Trinity (Respondent):** Article 13 does not prohibit corrosion or demand instant payment for it, but requires reimbursement for Trinity's losses suffered as a consequence of corrosion, so accrual turns on when Lattimore failed to reimburse incurred, resulting losses, which first happened when Lattimore repudiated the Lease in January 2020, six months before Trinity sued (Brief on the Merits (Respondent), PDF p. 31). Lattimore's reading would convert a reimbursement clause into a pay-on-corrosion warranty and raises unanswerable questions about how much was owed and when, and *Cosgrove* and *Archer* only prevent a claimant from picking its own accrual date by timing a demand, which the opinion below does not permit (Brief on the Merits (Respondent), PDF pp. 15-16, 32-33).

**Lattimore (reply):** Trinity's argument that its claim could not accrue until it suffered harm beyond its immediate economic loss, a harm that could arise only from its own decision to repair, re-lease, or replace the cars, would allow the open-ended breach claim the Court has condemned, and the court of appeals' reading and Trinity's reading both "impermissibly blue pencil" the Lease (Brief on the Merits (Petitioner), PDF pp. 14-16; Reply to Response to Petition filed (Petitioner), PDF p. 6).

## Stated Reasons the Court Should Take the Case
Lattimore argued that the court of appeals rewrote the parties' contract and let a claimant control its own accrual date, in conflict with *Cosgrove*, *Archer*, and the Court's recent decisions in *American Midstream* and *Lane*, and that the question is important to Texas businesses that rely on predictable contract enforcement and prompt adjudication of disputes (Reply to Response to Petition filed (Petitioner), PDF p. 6; Brief on the Merits (Petitioner), PDF pp. 15-16). Trinity answered that the case is important to these parties but not to the State, because it turns on the text of a single lease (Brief on the Merits (Respondent), PDF p. 12).

## Practice Area Tags
breach-of-contract

## Procedural Posture/Vehicle
Petition for review from the Dallas Court of Appeals, granted May 29, 2026, and set for oral argument at the SMU Dedman School of Law on October 8, 2026. After the parties reported a settlement, the Court granted a joint motion to abate on September 4, 2026, and removed the case from its active docket until October 15, 2026, by which time the parties must file either a status report or a motion to dismiss.

## Amicus Involvement
- [Texas Aggregates & Concrete Association](https://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=6ab76c4d-0710-4898-b991-32bd712df34d&coa=cossup&DT=BRIEFS&MediaID=6cfa6749-f45a-478c-be51-383a2fa679eb) filed an amicus brief supporting Lattimore's petition for review.
- [Texas Grain and Feed Association](https://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=d683bbd1-2cc9-4901-9c12-32900689e5a2&coa=cossup&DT=BRIEFS&MediaID=5bbe3514-abab-4ed9-b59a-e81060fa08c0) filed an amicus letter supporting Lattimore's petition.


---
Source: The SCOTX Report, https://scotxreport.com/cases/24-0953. 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.