Case Notes


Texas Supreme Court Refuses to Apply a Counteraffidavit Death Penalty Trap

June 20th, 2021 By Erin Holmes

On May 7, 2021, the Texas Supreme Court issued an opinion in In re Allstate Indemnity Co., ruling that a party’s failure to comply with the requirements of Section 18.001 of the Texas Civil Practice and Remedies Code for counteraffidavits does NOT preclude the party from offering evidence or argument regarding the reasonableness and necessity of past medical expenses at trial. Following a motor vehicle collision, Plaintiff Alaniz filed suit seeking underinsured motorist benefits under her policy with Allstate.  She
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Texas Supreme Court Holds Attorneys’ Fees May Be Recovered in UM/UIM Cases

June 6th, 2021 By David L. Plaut

In a long-awaited decision, the Texas Supreme Court decided Cause No. 19-0885, Allstate Insurance Co. v. Daniel Irwin (Tex. May 21, 2021) and the hotly-contested issue of whether attorneys’ fees are available in UM/UIM cases.  In a 5-4 decision authored by Justice John Devine, the Court’s majority held “a declaratory judgment action is the appropriate remedy for determining the underlying tort issues that control the validity of the insured’s [UM/UIM] claim against his insurer.”  Slip op. at *2, 5, and
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Fifth Circuit Certifies Eight Corners Exception to Texas Supreme Court

May 16th, 2021 By Jeffrey C. Glass

Making the call on the duty to defend a case in which the pleadings are silent on a key coverage question – such as the date damage occurred – is problematic for courts, carriers, coverage attorneys, and policyholders alike. The eight corners requirement, limiting the defense assessment to the live petition, generally precludes the use of extrinsic evidence to fill in such gaps in the pleadings. This leaves parties and courts guessing, leading to inconsistent results. Compare Great American Lloyds
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No Safe Harbor: Hinojos Holds “Late Payment” Penalties Apply Despite Insurer’s Timely Payment of an Appraisal Award

May 2nd, 2021 By David L. Plaut

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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In Re State Farm Requires Resolution of the “Car Crash” Case Before Consideration of any “Bad Faith” Claims

March 30th, 2021 By David L. Plaut

On March 19, 2021, the Texas Supreme Court issued an Opinion by Justice Blacklock reaffirming the continuing importance of its Brainard decision in the uninsured/underinsured (“UM/UIM”) motorist context. See In re State Farm Mutual Auto Ins. Co. et al. Without dissent, the Court held that UM/UIM claimants “must first obtain determinations of the third-party drivers’ liability and the amount of damages” in order to establish coverage. Slip Op. at *10. Because there was no judgment establishing the liability of the
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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.

January 31st, 2021 By Sheila Tan

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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Texas Supreme Court Hears Oral Argument on Allstate v. Irwin

January 7th, 2021 By David L. Plaut

The Texas Supreme Court heard oral argument on Thursday, January 7, 2021 in Allstate v. Irwin, an underinsured motorist case out of San Antonio addressing the availability of attorneys’ fees in such cases.  Plaintiff Daniel Irwin sued Allstate seeking a declaration that he was entitled to recover damages resulting from the wreck under his UM/UIM benefits policy and attorneys’ fees.  On appeal, Allstate argued the trial court abused its discretion in awarding Irwin declaratory relief and attorneys’ fees. Oral argument
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Federal court holds pollution exclusion does not apply to injuries caused by direct, personal exposures

October 11th, 2020 By Jeffrey C. Glass

In Canal Indemnity Company v. CalJet II, 4:2019cv02945  (opinion available on PACER), a Texas federal judge recently held pollution exclusions did not bar coverage for a suit involving a truck driver who allegedly died from cancer caused by exposure to the carcinogen benzene in gasoline, a cargo the driver loaded and unloaded. Although Texas courts have previously held that pollution exclusions are not limited to typical cases of environmental pollution, U.S. District Judge Alfred H. Bennett of the Southern District
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Fifth Circuit Affirms No Duty To Defend Against Criminal Charges Under Pollution Liability Policy

September 27th, 2020 By Erin Holmes

On September 4, 2020, the United States Court of Appeals for the Fifth Circuit upheld a district court’s decision that AIG Specialty Insurance Company (“ASIC”) was not liable for more than $12 million dollars in legal expenses incurred by Waste Management, Inc. (“Waste”) for defending criminal charges that were brought against the company for environmental contamination, agreeing with the lower court that there was no duty to defend the criminal case under the insurer’s pollution liability policy.  See Waste Management
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COVID-19 Case Note: Government mandated shutdown did not cause direct physical loss required to trigger business interruption coverage.

September 13th, 2020 By Sheila Tan

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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