Dallas Fort Worth Insurance Lawyer Blog
Hee is a 2021, opinion dealing with bad faith claims by an insured and the insurance company efforts to dispose of the bad faith claim via summary judgement. The opinion is from the Southern District of Texas, Houston Division, and is styled, GeoVera Specialty Insurance Company v. Sam Walker.
The insured is Walker. The insurance company is GeoVera. Walker suffered wind damage and a subsequent theft claim. There are other issues in the case, but only the bad-faith / extra=contractual issues will be looked at here.
Geovera denied the claim and then sued Walker seeking a declaratory judgment that it did not owe any damages to Walker.
GeoVera contends Walker’s pleadings as to the extra-contractual claims fail to state a claim upon which relief can be granted. Without much discussion, the Court denied this part of GeoVera’s motion.
GeoVera contends Walker fails to adequately plead a single fraudulent representation by GeoVera. Walker did not address this contention. Federal Rule 9(b) requires “all averments of fraud or mistake” be plead with”particularity.” To show “particularity” of the circumstances constituting fraud the plaintiff must allege “time, place, and contents of the false representations, as well as the identity of the person making the misrepresentations and what he obtained thereby.” Walker fails to describe how GeoVera misrepresented the policy, what information Walker was told, or who made the alleged misrepresentation. The Court granted GeoVera’s motion on this part.
GeoVera contends Walker does not have evidence to support the extra-contractual claims based on either the theft-based claim or the wind-based claim. Walker did not address this in his response.
Walker does not allege or produce any evidence showing the extra-contractual claims related to the wind-based claim are based on an injury independent of the alleged denial of benefits under the policy. The Court then granted GeoVera’s motion on this part of the claim.
GeoVera contends there is abundant evidence of a bona fide dispute regarding the reasonableness of GeoVera’s conduct in determining the theft-based claim. Walker did not address this. A cause of action for breach of the duty of good faith and fair dealing exists when the insurer has no reasonable basis for denial of that coverage. Similarly, causes of action against insurers for bad faith under the DTPA and Chapter 541 require the same predicate for recovery as bad faith common law claims. The existence of a bona fide controversy is a sufficient reason for failure of an insurer to make a prompt payment of a loss claim. The Court then discussed the evidence in the case and concluded there was sufficient reason for GeoVera to deny the claim.