Articles Posted in Value of Claim

Texas insurance lawyers know insurance companies always want to wage litigation in Federal Court. A recent case illustrates this. The case is from the U.S. District Court, Northern District of Texas, Dallas Division. The style of the case is Clear Vision Windshield Repair, LLC v. Allstate Fire and Casualty Insurance Company.

This lawsuit was originally filed in State District Court wherein Clear Vision alleged violations of the Texas Insurance Code, Chapters 541 and 542. Allstate caused the case to be removed to Federal Court asserting there was diversity of citizenship and the amount in controversy exceeded $75,000. Clear Vision disagreed and contended that Allstate had not shown the amount in controversy exceeded $75,000. Specifically, Clear Vision contended there were nine individuals who had windshield repairs that were not paid or not fully paid and that the individual claims cannot be segregated to meet the jurisdictional threshold for diversity jurisdiction. Allstate countered that the rule against aggregation of claims does not apply because Clear Vision is the only plaintiff and Clear Vision has stated it seeks monetary relief in excess of $100,000.

A federal court has an independent duty, at any level of the proceedings, to determine whether it properly has subject matter jurisdiction over a case. This duty must be policed by the courts on their own initiative even at the highest level.

Irving insurance lawyers need to be able to discuss with clients when offers of settlement should be accepted and how to accept the claim. A good illustration of this is found in a 2015, Houston Court of Appeals [1st. Dist.] opinion. It is styled, Kamisha Davis v. Texas Farm Bureau Insurance.

Kamisha Davis sued Farm Bureau, asserting several causes of action. The trial court granted summary judgment against Davis in favor Farm Bureau.

On August 26, 2009, Kamisha Davis was involved in a motor vehicle accident with Farm Bureau’s insured. Davis hired attorney Corey Gomel to pursue a personal injury claim arising out of the accident. On April 19, 2011, Gomel sent Farm Bureau a letter, stating that Davis would be willing to settle her personal-injury claims against Farm Bureau’s insured for $37,500. Farm Bureau, through its claims adjuster, Jody Roe, made a counter-offer of $10,000 on May 2, 2011.

Saginaw insurance lawyers have to know the requirements to filing a lawsuit against an insurance company. The company is entitled to a pre-suit notice and failing to give notice can result in the case being thrown out of court.

Just sending a letter is not good enough. There are requirements to the content of the letter.

As a prerequisite to filing a lawsuit seeking damages for wrongs believed to be committed, the insured must give written notice at least 60 days before filing the lawsuit. The notice must tell the insurance carrier the specific complaint, the amount of actual damages and expenses, including attorney’s fees, incurred in asserting the claim. This requirement is found in the Texas Insurance Code, Section 541.154. Keep in mind it is not enough to just say, “hey you owe me $x.” The letter must be clear as to what the insurance company has done that is wrong and clear as to how any dollar figure asserted is calculated.

An insurance attorney in Grand Prairie will run across a situation where a loss has been the result of multiple causes. When this happens, how are the policy limits determined is a question that needs to be answered. All situations are different and each case needs to be examined on a case by case basis would be the short answer. A 2004, a United States Federal, Southern District of Texas case gets specific and gives some guidance as to how the courts look at the various situations that may arise. The style of this case is, Ramirez v. State Farm Lloyds. Here is some of the relevant information from that case.

Pedro and Paulita Ramirez purchased a homeowner’s policy from State Farm Lloyds insuring their residence against property damage with liability limits of $90,800.00 for the property damage and $54,480.00 for loss to the contents of the home. In April 2001, they notified State Farm that they had water damage in the home due to leaking appliances and wind driven rain. State Farm investigated the claim and determined that seven different water sources caused the damage and set up a separate claim for each source. The cost to repair the damage to the home exceeded the policy limit. State Farm paid the policy limit but Ramirez filed suit alleging breach of contract, breach of the duty of good faith and fair dealing, violations of the Texas Insurance Code and violations of the Prompt Payment of Claims Act, and violations of the Texas Deceptive Trade Practices Act (DTPA). State Farm filed a motion for summary judgment on all counts. The trial court granted the summary judgment in favor of State Farm.

In the holding of the court, the court found that the loss settlement provision in the Texas Homeowners Policy limits the insured’s recovery to a single policy limit as stated on the declaration page, despite the fact that seven different water sources resulted in damage to the insured residence and despite the fact separate claims were set up for each water event. Since the policy limits were paid, State Farm did not breach the contract.

Tarrant County insurance lawyers need to know how to recover attorney’s fees in an insurance and DTPA lawsuit. The 1997, Texas Supreme Court case styled, Arthur Andersen & Co. v. Perry Equipment Corp. provides some guidance in that regard. Here is some of the relevant information from that case.

Perry sued Arthur Andersen for a faulty audit which Perry relied on to purchase another company called Maloney Pipeline Systems. The audit incorrectly reported favorably Maloney’s financial condition when the company was suffering substantial losses. Within fourteen months after purchase, the company went bankrupt. Perry sued Arthur Andersen for violations of the DTPA, fraud, negligence, negligent misrepresentation, gross negligence, and breach of implied warranty. Based on the verdict returned by the jury, the trial Judge rendered judgment for Perry for the DTPA cause of action. This judgment included amounts for attorney’s fees based on a contingency fee agreement.

The judgment in favor of Perry was reversed and remanded to the trial court.

Arlington insurance lawyers need to know what to look for in a case to determine how likely it is to achieve punitive damages. A 1998, Texas Supreme Court opinion sheds some light on how the court looks at punitive damages evidence. The style of the case is, State Farm Fire & Casualty Company v. Simmons. Here is some of the relevant evidence in the case.

The plaintiff in this case, Simmons, had purchased his first home by financing through a VA loan. Simmons was a construction supervisor who fell on hard times when his work slowed down. Simmons arranged a repayment program with the VA that substantially lowered his monthly payments. The same month he worked out this refinance program, his home was burglarized. The burglary occurred in the day and none of Simmons neighbors saw any wrong acts around Simmons home. Simmons began his own investigation and followed some wheel barrow tracks through the woods around his house to the home of Mattix, who later confessed to the police that he had committed the burglary of Simmons home. State Farm paid Simmons for this loss. Simmons then experienced a rash of vandalism to his property. Simmons then left to take his children to Louisiana for the summer. He planned to return right away because he had to work the next day. Soon after he left, someone noticed smoke from Simmons home. His home was completely destroyed by fire. State Farm denied the fire loss claim.

At trial, the jury made a finding that Simmons did not burn his own home, then found that State Farm had breached its duty of good faith and fair dealing in handling the claim and for knowingly violating the DTPA. The jury also determined State Farm acted with conscious indifference in determining whether there was a reasonable basis to deny Simmons claim. Based on these findings, Simmons was awarded $275,000 for actual damages and $2 million in punitive damages.

Fort Worth insurance lawyers need to be able to discuss with clients, the situations wherein punitive damages may be part of a claim. A 2008, 5th Circuit Court of Appeals opinion discusses one aspect of these punitive damages. The style of the case is, American International Specialty Lines Inc. Co. v. Res-Care, Inc. Here is the necessary information.

American sought reimbursement from Res-Care under a non-waiver agreement for the uncovered claims included in its $9 million settlement of the underlying claim, asking the district court to apportion the settlement costs among covered and non-covered claims. The court determined that the non-waiver agreement satisfied the conditions set forth by the Texas Supreme Court for reimbursement. Turning to the merits, the court determined the district court properly considered all evidence relevant to the settlement decision, and was not limited to considering only the evidence admissible in the underlying suit. Res-Care sought to defeat American’s coverage claims by asserting waiver and estoppel because American waited 18 months after coverage issues were apparent before raising a coverage question. The court further held Res-Care waived the defense by entering into the non-waiver agreement, and the court found no merit in Res-Care’s contention that it was “forced” to enter into the non-waiver agreement.

In making its ruling in this case, the court found Texas public policy did not provide coverage for punitive damages in this instance given the egregious circumstances and nature of the avoidable conduct that caused the injuries. The 5th Circuit stated that “we conclude that the extreme circumstances which gave pause in another related court decision were present in this case. The plaintiff’s complaint in the underlying case is rife with allegations of gross negligence for which the responsibility should not be shifted from the defendants to their insurance company. The complaint alleged that all defendants including Res-Care, were grossly negligent in their actions, not only for direct participation in the bleach incident on April 12, 1998, but also for failure to take reasonable steps to prevent the situation from occurring, and for failure to alleviate the harm immediately afterward.” The circumstances of the decedent’s injury and death, were so extreme that the purposes of punishment and deterrence of conscious indifference outweigh the normally strong public policy of permitting the right to contract between the insurance company and the insured.

Any Dallas insurance attorney can tell you that mental anguish can be a part of an insurance bad faith claim. The key to keep in mind is the evidence necessary to show a person eligible to recover for mental anguish.

This was explained in part by the 1996, Texas Supreme Court case styled, Saenz v. Fidelity & Guaranty Insurance Underwriters.

In Saenz, Corina Saenz sued her employer’s workers compensation insurance company for wrongfully inducing her to settle her claim. Saenz recovered actual damages for future medical costs, damages for mental anguish, and punitive damages.