Appraisal
Is Your Numerator Zero? Rodriguez and Attorneys’ Fees in the Appraisal Context
In a recent case grounded in the “plain language” of the appraisal clause of the Texas Homeowners’ insurance policy, the Texas Supreme Court answered a certified question from the Fifth Circuit and held “an insurer’s payment of the full appraisal award plus any possible statutory interest precludes the recovery of attorneys’ fees. See Cause No. 23-0534, Rodriguez v. Safeco Ins. Co. of Indiana, Slip Op. at *1 (Tex. Feb. 2, 2024). In so holding, the Court not only resolved a
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No Safe Harbor: Hinojos Holds “Late Payment” Penalties Apply Despite Insurer’s Timely Payment of an Appraisal Award
On March 19, 2021, the Texas Supreme Court issued a 7-2 decision and Opinion by Justice Jane Bland holding there is no appraisal payment safe harbor from Chapter 542 late payment liability for insurers that timely pay appraisal awards after accepting coverage when those payments are late under the statute. See Cause No. 19-0280, Hinojos v. State Farm Lloyds et al., slip op. at *2. In so holding, Hinojos emphasizes that “claim” under Chapter 542 means the amount that “must
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Barbara Technologies and Ortiz Allow Attorneys’ Fees and Late Payment Penalties Despite Insurer’s Payment of Appraisal Award.
“I come, then, to bury appraisals, not praise them.” -Chief Justice Nathan Hecht, Barbara Technologies (dissenting). In its Barbara Technologies and Ortiz decisions last Friday, the Texas Supreme Court resolved the troublesome question of whether an insurer’s payment of an appraisal award necessarily precludes common law and statutory “bad faith,” as well as prompt payment penalties under the Texas Insurance Code. Writing for a 6-3 majority in Barbara Technologies, Justice Paul Green found in favor of the policyholder and held
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Plaut Spouts: Reflections of an Old Guy with a Corner Office
On February 20, 2019, the Texas Supreme Court heard argument in Barbara Technologies Corp. v. State Farm Lloyds and Oscar Ortiz v. State Farm Lloyds. These cases raised questions about whether insurers have potential Insurance Code and common law “bad faith” liability following invocation of the appraisal process and payment of an appraisal award. In both cases, appraisal panels awarded significantly more for repair costs than the insurers had initially estimated, making them attractive vehicles for policyholder arguments that carriers
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To err is human. To disagree on an appraisal award is not grounds to set it aside.
In Abdalla v. Farmers Ins. Exchange, No. 07-17-00020-CV, 2018 WL 2220269 at * 1 (Tex. App.—Amarillo May 14, 2018, no pet. h.), the Amarillo Court of Appeals rejected an insured’s attempt to convert a disagreement among appraisers regarding the extent of damage into a reason to set aside a valid appraisal award. The court of appeals affirmed the trial court’s decision denying Abdalla’s motion to vacate the umpire’s award and granting summary judgment in favor of Farmers. Abdalla sued Farmers alleging breach
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Appraisal Payments: Don’t be late for this very important date.
A recent opinion out of the Western District of Texas, Kezar v. State Farm Lloyds, 1:17-CV-389-RP, 2018 WL 2271380, at *1 (W.D. Tex. May 17, 2018), adds further support for post-appraisal summary judgments on extra-contractual claims, but also suggests a strict analysis of whether or not appraisal payments are timely. The Kezar plaintiffs filed their lawsuit against State Farm asserting causes of action for breach of the insurance policy, statutory and common law bad faith, unfair settlement practices, negligence and
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Plaintiff Cannot Checkmate Carrier With Pre-Suit Appraisal Reference
In the recent case of In re Allstate Vehicle & Prop. Ins. Co., 09-18-00024-CV, 2018 WL 1003794, (Tex. App.—Beaumont Feb. 22, 2018, no pet. h.), the Beaumont Court of Appeals confirmed per curiam that insurance carriers do not waive their right to appraisal in response to pre-suit demands by claimants. With the exception of an unusual reference to appraisal by the claimant, the facts of the case were relatively typical. After an initial inspection and payment on a claim for
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San Antonio Court of Appeals Issues Strong Appraisal Opinion
Adding to a line of Texas cases that found appraisal resolved all issues regarding a dispute over the cost and scope of damage to a homeowner’s property, the Fourth Court of Appeals in San Antonio recently affirmed a trial court’s decision to grant summary judgment after completion of appraisal and payment of the appraisal award by State Farm in Garcia v. State Farm Lloyds. No. 04-16-00209-CV, 2016 WL 7234064 (Tex. App.–San Antonio Dec. 14, 2016, no pet. h.). In Garcia,
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