Severance makes the appellate court’s heart grow fonder.
A recent Thirteenth Court of Appeals opinion reminds us of when it is appropriate to seek a severance and abatement of extracontractual claims from a contract claim for policy benefits, while also clarifying the scope of permissible discovery in such cases. In re Old Republic Ins. Co., 13-21-00264-CV involved a suit filed by Uhr Real Estate, Inc. against Old Republic. The petition alleged that homeowners David and Valerie Fallas had contracted with Uhr to repair damage done by Hurricane Harvey
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Talking about Covid-19 and the car wash: Agent was improperly joined and virus exclusion applied to bar business interruption coverage.
The joinder of an insurance adjuster or agent as a defendant, in a case against an insurance carrier, is a commonly used strategy to defeat diversity. Many attorneys for insurance practitioners have found that challenging joinders of insurance agents and adjusters can be an exercise in futility given the broad reach of the Texas Insurance Code. But a district court in the Western District of Texas recently affirmed the importance of challenging a plaintiff’s failure to allege specific, affirmative misrepresentations
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COVID-19 Case Note: Government mandated shutdown did not cause direct physical loss required to trigger business interruption coverage.
For many businesses in Texas that have been shut-down or restricted by state and local government orders due to the ongoing Covid-19 pandemic, one of the most pressing questions raised is: is there business interruption coverage? And for at least some barber shops in Bexar County, the Western District has answered with a definitive no. In Diesel Barbershop et al. v. State Farm Lloyds, No. 5-20-CV-461-DAE, Plaintiffs run barbershop businesses that were classified as “non-essential businesses” and forced to cease
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Show Me the Money? Not So Fast!
In a personal injury case, tort claimants typically submit medical bills showing treatment received for injuries. Settlements paid out of insurance policy benefits are often meant to cover such expenses. After settling, plaintiffs’ attorneys routinely negotiate a reduction of the submitted bills directly with the medical providers, leading to a bigger share of the recovery for their clients.What happens when a carrier pays a hospital’s bill directly? Such direct payments generally reflect a reduction in the original billed amount. We’ve
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A Flood of Bad News for Tardy Claimants
Floods are unfortunate recurring events in Texas, and more so in recent years with Hurricane Harvey highlighting just how destructive Mother Nature can be. Little wonder that flood insurance and flood claims have been the subject of plenty of litigation and a recent opinion from the Fifth Circuit underscores how tricky it can be to navigate these waters (pun intended). Flood is generally not covered under a standard homeowner’s policy. In order to allow homeowners to obtain such coverage the
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Brainard Rule Under Attack in Texas House of Representatives
Uninsured and underinsured (“UM/UIM”) motorist insurance coverage continues to be a hotly debated topic, as attorneys representing insureds seek ways to recover attorneys’ fees in this hybrid cause of action. As we recently reported, the Texas Supreme Court recently turned back one attempt when it denied review in the case of Weber v. Progressive. Currently, the long-established Brainard rule is under legislative “attack” from H.B. 1739. H.B. 1739 seeks to do what Weber could not: eliminate the requirement that she
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Keeping Adjusters Out of the Hot Seat – UM/UIM Edition
UM/UIM cases are a unique hybrid of tort and contract. Although the insured’s own insurance carrier is often named as a defendant, it has no contractual duty to pay benefits until after the liability of the insured and the other motorist, as well as the damages suffered by the insured, have been determined. Brainard v. Trinity Universal Ins. Co., 216 S.W.3d 809, 815 (Tex. 2006). Trial courts often struggle with the dilemma of how to avoid the prejudicial injection of insurance
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Adjuster in the UM/UIM Hot Seat? Houston Court of Appeals Says No
One of the more contentious battles in a UM/UIM case is the taking of the deposition of insurer’s corporate representative. The good news is that more and more Texas courts are acknowledging that the corporate representative’s deposition in a UM/UIM matter has no bearing on the issues of the tortfeasor’s liability and damages and “is not reasonably calculated to lead to the discovery of admissible evidence.” We suspect that Plaintiffs’ lawyers desire to get insurance carrier representatives in the hot
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Insured cannot lay down its burden and survive summary judgment.
In Certain Underwriters at Lloyd’s of London v. Lowen Valley View, LLC, 892 F.3d 167 (5th Cir. June 6, 2018), the Fifth Circuit affirmed that in addition to establishing that the insured property sustained hail damage within a policy period, the policyholder must also provide some evidence of how much of the hail damage was attributable to the hail event within the policy period, and the failure to do so should lead to summary judgment against the policyholder. Insurance underwriter
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Advertising full coverage does not establish a misrepresentation where amount of loss is disputed.
Plaintiffs in first-party property insurance cases often include a misrepresentation claim, typically arguing that the carrier’s failure to pay sufficient amount for covered damage to the property constitutes a misrepresentation. While state court judges may sometimes allow these claims to go to a jury, Texas law clearly holds that disputes about the amount of the loss do not constitute misrepresentations of the policy. In Click v. State Farm Lloyds, No. 1:17-CV-00108-BL, 2018 WL 1322167 (N.D. Tex. March 13, 2018) (slip
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