Insurance Law And Legal Procedure

Most homeowners in Weatherford, Mineral Wells, Aledo, Hudson Oaks, Willow Park, Azle, Peaster, Brock, Millsap, Cool, and other communities in Parker County would not be very interested in the legal technicalities associated with an insurance dispute. Instead they would hire an experienced Insurance Law Attorney and let that person handle the legal aspects of dealing with the insurance company. However, knowing a little about how it sometimes works can be informative.
The 14th Texas Court of Appeals in Houston issued an opinion on May 26, 2011. The style of the case is “In Re Liberty Mutual Group, Inc.” This case is called a “mandamus proceeding” and arises from a dispute over the amount of the covered loss under a homeowner’s insurance policy. On April, 18, 2011, Liberty filed this action asking the appeals court to compel, the Honorable Mike Miller, Judge of the 11th District Court of Harris County, to abate the underlying lawsuit until an appraisal to determine the amount of the covered loss had been completed. This appeals court denied the request.
Here is some background information. After Hurricane Ike, the homeowners filed a claim under their insurance policy with Liberty. A dispute arose over the amount of the covered loss. Liberty invoked the appraisal process pursuant to the terms of the insurance policy. The appraisal was underway when the lawsuit was filed against Liberty. Liberty answered the lawsuit and then filed a motion to abate the case until the appraisal process was completed.
Legally speaking, mandamus relief is available if the trial court abuses its discretion, either in resolving factual issues or in determining legal principles, when there is no other adequate remedy by law. A trial court abuses its discretion if it reaches a decision so arbitrary and unreasonable as to amount to a clear and prejudicial error of law, or if it clearly fails to analyze or apply the law correctly.
The Texas Supreme Court in a 2002 case, In re Allstate County Mutual Insurance Company, has determined that mandamus relief is appropriate to enforce an appraisal clause because denying an appraisal would nullify the insurance company’s right to defend its breach of contract claim. In this Liberty case, the parties had begun the appraisal process, and Liberty had not asked the court to enforce the appraisal clause. Instead, the only relief sought was that the trial court be ordered to abate the case until the appraisal had been completed.
As recently as May 6, 2011, in the case, In re Universal Underwriters of Texas Insurance Company, the Texas Supreme Court confirmed that a mandamus action is not proper regarding the grant or denial of a motion to abate. Specifically addressing a motion to abate for an insurance appraisal, the court held that “the trial court’s failure to grant the motion to abate is not subject to mandamus, and the proceedings need not be abated while the appraisal goes forward.”
So accordingly, Liberty’s petition for a writ of mandamus was denied.
Most insured people do not need to get bogged down in the legal formalities of an insurance law lawsuit. On the other hand, knowing or understanding some of the steps that are taking place is reassuring even when the steps taking place are not always the way one would want them to go.