Articles Posted in Intentional Acts

Here is one for an insurance attorney to answer.  A potential new client comes in the door.  This person says they were drinking and got drunk, then they punched a friend in the face causing injury.  The friend sues for the harm that was done and your potential new client asks his insurance company to defend him in the lawsuit.  Is there coverage?

Guidance for the answer is found in a 1997, Dallas Court of Appeals opinion.  The opinion is styled, Wessinger v. Fire Insurance Exchange.

This is a declaratory judgment action brought by Fire Insurance against its insured under a homeowner policy.  Fire Insurance sought a declaration of no coverage for an incident in which the insured became intoxicated and assaulted a third-party friend.  The insured and the third-party answered and counterclaimed asserting breach of insurance contract, violations of the Texas Deceptive Trade Practices Act and the Insurance Code.  Fire Insurance moved for summary judgment stating that the insured’s actions were not accidental but were intentional conduct excluded from coverage.  The trial court entered summary judgment in favor of the carrier.

Insurance lawyers can tell you that most intentional acts are not covered by an insurance policy. What if the act occurs in the context of a sports event? A 1998, Fort Worth Court of Appeals case talks about this. The style of the case is, Monk v. Phillips.

Factual background – Michael, Phillips, Gary Duffek (“Duffek”), and Gary Watson (“Watson”) were playing a recreational game of golf as a foursome when the incident occurred. Phillips’s first tee shot on the second hole traveled off to the right side of the fairway into the trees. Phillips then shot a mulligan, a second tee shot, which also traveled off to the right and landed near the first ball. Because only the second ball was visible from the cart path, Michael and Duffek attempted to retrieve the missing first ball.

Phillips decided to play the second ball and proceeded to its location in the rough to the right of the fairway. At this point, Michael and Duffek, riding in the golf cart, passed in front of Phillips and then to Phillips’s right. Phillips heard Duffek say “look out, he’s fixing to hit.” No one told Phillips to wait. Phillips then hit the ball off the toe of his golf club, shanking the ball to the right at an approximately ninety-degree angle from where he intended the ball to go. The ball struck Michael, leaving him blind in his right eye.

Colleyville insurance lawyers do not want to waste their time on cases where a person is trying to commit a fraud. The Insurance Journal ran an article in late December 2015, wherein they publicized some extreme attempts at insurance fraud. The article is titled, Insurance Fraud Hall of Shame Reveals 2015 Inductees.

Blown up houses, staged wrecks and bogus spine surgeries were among the damage inflicted by nine convicted scammers newly selected to the Insurance Fraud Hall of Shame.

They were enshrined by the Coalition Against Insurance Fraud. The Hall of Shame recognizes the year’s most extreme insurance schemers. All were convicted or had other legal closure in 2015.

Fort Worth insurance lawyers need to have an understanding of the requirements for suing an insurance company for fraud. A 2015, United States District Court, Austin Division, case is a good place to start for grasping the requirements. The case is styled, Bige, Inc. v. Penn-America Insurance Company; Specialty Insurance Managers, Inc; Eric Kehs.

Bige alleges Penn-America sold them a Policy, representing it included wind and hailstorm coverage for damage to the Property. Bige further alleges the Property sustained damage from a storm. Bige submitted a claim to Penn-America for the damage.

Bige states Penn-America hired or assigned Kehs to adjust the claim, but Kehs failed to fully investigate the claim. Bige alleges, although Penn-America and Kehs acknowledged damage to the Property, Kehs conducted a substandard and improper inspection of the Property, which yielded a grossly inaccurate and unrealistic assessment of the cause, extent and dollar amount of the damage to the Property. Specifically, Kehs determined the amount of damage was less than Bige’s deductible under the Policy. Bige further alleges, upon receipt of the inspection reports, Penn-America failed to review the assessment thoroughly, resulting in a failure to provide coverage due under the Policy. Bige further alleges, following receipt of Bige’s demand letter, Penn-America and Kehs refused to conduct further investigation that was not “outcome-oriented.”

Insurance lawyers in the DFW area need to stay on top of the insurance news in Texas. One good resource for keeping informed is the Insurance Journal. The Insurance Journal published an article in March of 2015 and another related article in July of 2015.

The first article tells us that on the heels of a recent multi-million dollar refund agreement with the state’s largest homeowners insurer, the Texas Department of Insurance announced a revised settlement with the second largest homeowners insurer, Farmers Insurance, stemming from a 2002 lawsuit by the state against Farmers.

The settlement now goes before a Travis County District Court for approval.

Azle insurance lawyers need to be able to recognize when a case might have extra-contractual issues to litigate.

A mere breach of an insurance contract is not actionable under the DTPA or Insurance Code. There must be something more in the way of fraud or misrepresentation in order to establish a cause of action. A breach of contract, even if proven, does not constitute an “unconscionable” act.

A reasonable basis for an insurance company to deny a claim may establish a defense to a claim for breach of the duty of good faith and fair dealing. But this defense to a bad faith suit does not foreclose any other contractual claims, such as violation of the DTPA. violation of the Insurance Code or common law negligence. The Texas Supreme Court has repeatedly instructed that an insurance company will not be faced with a tort suit for challenging a claim of coverage if there was any reasonable basis for its denial of that coverage.

Fort Worth insurance lawyers can tell you that most insurance policies do not cover acts committed intentionally by the insured. They only cover accidents. A 1997, Dallas Court of Appeals case shows at least one way how this works. The style of the case is, Wessinger v. Fire Insurance Exchange.

Michael D. Wessinger got drunk and inexplicably punched Dennis Lee Morrison in the face several times, causing permanent vision loss. Wessinger does not deny that he attacked Morrison, but claims his intoxication influenced his decision to punch Morrison; he does not remember punching Morrison; and he never intended to injure Morrison. In this insurance coverage case the court has to decide whether Wessinger’s drunken decision to punch Morrison constitutes an accident, so that it falls within the definition of an occurrence covered by Wessinger’s homeowner’s insurance policy. Because the court concluded that voluntary intoxication does not destroy the volitional and intentional nature of Wessinger’s conduct and that Morrison’s injuries naturally resulted from that conduct, Wessinger’s act was not accidental and thus not a covered occurrence.

Morrison initially sued Wessinger alleging that Wessinger negligently caused him injury when, in a drunken fit, Wessinger punched Morrison repeatedly in the head. A jury found Wessinger liable and awarded Morrison $127,187 in damages. The district court signed a judgment on the verdict.