Dallas Fort Worth Insurance Lawyer Blog

Intentional Act Versus Accident

November 29, 2014 | Mark S. Humphreys

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.

Cancellation For Nonpayment And Notice

November 27, 2014 | Mark S. Humphreys

Insurance attorneys in Dallas will see situations where a policy is cancelled due to nonpayment of premiums. The Texas Insurance Code, Sections 551.101 thru 551.113 deal with policy cancellations. But what about specific situations. Here is a 1997, case to look at. It is a U.S. Eastern District opinion styled, Clare v. Richards. Here is what it tells us.

Heilman applied for a commercial property insurance policy for his restaurant. Richards and City National were listed as an “additional interests” on the policy. City National held a mortgage on the property and Richards was the owner of the real property and building in which the restaurant was operated. Heilman entered into an insurance premium financing agreement with Texas Specialty Finance (TSF). Heilman gave TSF full power of attorney to cancel the insurance policy and collect any return premiums in the event of nonpayment of policy premiums when due. When Heilman failed to make payment, TSF mailed Heilman notice of intent to cancel the policy. Prior to cancellation, notice of cancellation was never sent to the “additional interests.”

On February 6, 1997, the policy was canceled effective January 31, 1997. The restaurant was destroyed by fire on February 9, 1997.

Insurance And Intent

November 25, 2014 | Mark S. Humphreys

Garland insurance attorneys need to understand when coverage under an insurance policy is going to be provided and when it is not, due to the intent of the policyholder. A 1998, Amarillo Court of Appeals case is a good case to examine in helping to determine this issue. The style of the case is, Spruiell v. Lincoln Insurance Company. Here is some of the relevant information from that opinion.

McKean was a business person who leased a premises from Smith in which McKean operated the Tumbleweed Cafe. Spruiell’s Automotive shared an adjoining firewall with the cafe. Fire destroyed the cafe, heavily damaged Spruiell’s Automotive, severely burned McKean and killed McKean’s brother-in-law. McKean pleaded guilty to first degree arson and was sentenced to sixteen years in prison.

Spruiell subsequently filed a lawsuit against McKean and Smith alleging negligence in causing the fire and res ipsa loquitur, and seeking damages for the loss of personal property and equipment as a result of the fire.

Dallas Insurance Attorneys Need To Know What An Insurable Interest Is Defined

November 23, 2014 | Mark S. Humphreys

Dallas insurance lawyers need to be able to discuss with a client when insurance is going to cover a loss. This may seem easy at first but that is not always the case. The Texas Supreme Court issued an opinion on this issue in 1963, in a case styled, Smith v. Eagle Star Insurance Company. Here is some of the information from that case.

This is a suit to recover on a fire insurance policy for the loss of a house brought by Smith against Eagle Star Insurance Company, Ltd. Judgment was for Smith in the trial court.

Both parties filed motions for summary judgment in the trial court. The trial court granted Smith’s motion for summary judgment and denied Eagle Star who appealed.

What Is An Insurable Interest

November 22, 2014 | Mark S. Humphreys

Arlington insurance lawyers need to understand what an “insurable interest” is when it comes to making a claim. A 1999, Austin Court of Appeals opinion gives some guidance about this issue. The style of the opinion is, Valdez v. Colonial County Mutual Insurance Company. Here is some of the relevant information from the case.

Valdez purchased an insurance policy from Colonial. The Colonial policy was a standard Texas automobile insurance policy which insured Valdez 1992 Plymouth. Later, Valdez sold and transferred title of the vehicle to his adult son, Rene. Rene obtained new financing for the vehicle and Valdez notified Colonial that Mercantile Bank was the new lienholder of the automobile. Valdez however did not notify Colonial of the change of title to his son, Rene. But, Colonial’s change form did not request that information.

Rene worked in Mexico City and left the car with Valdez who continued to use the vehicle and pay the policy premiums. Valdez renewed the policy. More than a year after Rene bought the car, the vehicle was stolen while parked outside Valdez’s residence. Valdez filed a claim that Colonial refused to honor. Colonial filed suit seeking a declaratory judgment that Valdez did not have an insurable interest in the stolen vehicle and that Colonial had no insurance coverage obligations under an automobile insurance policy issued to Valdez. The trial court granted summary judgment in favor of Colonial. This appeal followed.

Jury Trial Says Insurance Paid Enough

November 20, 2014 | Mark S. Humphreys

Attorneys handling insurance claims need to be aware of legal matters be decided in the state that relate to insurance. The Insurance Journal ran an article dated October 21, 2014, that is titled, Jury Finds Texas Windstorm Insurer Adequately Paid City For Ike Claims. Here is what the article tells us.

Texas’ wind and hail insurer of last resort in coastal areas announced that a judgment has been entered in its favor in a lawsuit brought by League City in Southeast Texas.

The judgment signed on Oct. 16, 2014, by Presiding Judge Kerry Neves of the 10th District Court in Galveston, Texas, found that League City was not entitled to further payment from the Texas Windstorm Insurance Association (TWIA) over damage to city property during Hurricane Ike in 2008.

Dangerous Ways Insurance Companies Can Settle

November 18, 2014 | Mark S. Humphreys

Dallas and Fort Worth insurance lawyers need to be able to explain to clients the different responsibilities insurance company’s have regarding settling cases. A 1999, U.S. 5th Circuit case is worth reading. The style of the case is, Travelers v. Citgo Petroleum. Here is what it says.

Travelers issued three polices to Wright Petroleum: a business auto policy, an umbrella policy, and a general liability policy. Citgo had a franchise agreement with Wright. Citgo was made an “additional insured” to each policy. The business auto policy provided that the carrier could investigate and settle any claim and its duty to defend or settle ended when the limits of coverage had been exhausted by payments of judgments or settlements.

In October 1992, one of Wright’s tanker trucks and an automobile collided. The tanker allegedly ran a red light at an intersection. Both drivers were killed. The tanker was carrying petroleum products for Citgo, as well as several other oil companies.

Named Property In An Insurance Policy

November 16, 2014 | Mark S. Humphreys

Fort Worth insurance attorneys will tell you that they need to know a few things to be able to properly discuss the legal aspects of a claim with a potential new client. One, what are the facts of the claim. Two, what does the policy say. And three, how do the courts interpret situations similar to the situation being dealt with.

Unpublished opinions historically are not given a lot of notice but they do give an attorney insight into how the courts look at specific situations. A 1996, unpublished opinion from the Dallas Court of Appeals is worth reading. It is styled American Indemnity Company v. McFarland Insurance Agency. Here is some of the relevant information from that case that is worth knowing.

The insurance carrier, American Indemnity, in this case issued a Texas commercial package through McFarland which contained four different commercial coverages: fire and extended, glass, general liability, and inland marine. The insured purchased the inland marine to insure video equipment.

Exclusions In An Insurance Policy

November 15, 2014 | Mark S. Humphreys

Grand Prairie insurance lawyers need to know how “exclusions” in an insurance policy work. This is partially explained in a 1994, San Antonio Court of Appeals case. The style of the case is, Telepak v. United Service Automobile Association. Here is the relevant information from the case.

The question before the court concerned whether the insured or the insurer has the burden of proof as to the applicability of an exception to an exclusion in an insurance policy. The court held that the applicability of an exception to an exclusion is a question of coverage, on which the insured has the burden of proof.

The insured brought a claim under an all-risk homeowner’s insurance policy for damage to their home. It is undisputed that the damage was incurred by the settling of the foundation. In its answer, the insurer pled the affirmative defense that “exclusion k” of the insurance policy excluded from coverage damage resulting from settling or cracking of the foundation. The insured asserted that the settling was caused by water which leaked from an air conditioner and escaped under the foundation of their home. They asserted that their loss fell under an exception to exclusion k, which stated that exclusion k would not apply to settling caused by accidental leakage from an air conditioning system. The jury charge read as follows:

What Happens When An Insurance Company Denies A Claim

November 13, 2014 | Mark S. Humphreys

The answer to the above question when asked of a Dallas insurance attorney will result in an answer of, “it depends.” There are many factors that come into play when trying to understand the consequences of the denial. The worst result for the claimant and best result for the insurance company might be that the insurance company does not have to pay anything on the claim.

The best result for the claimant and the worst for the insurance company might be what was reported by The Pennsylvania Record in an October 2014 article. The title of the article says it all, “Bad Faith Settlement With Allstate Awards $22 Million To Accident Victim.” Here is what the article tells us.

The rejection of a $250,000 claim has ultimately cost insurance giant Allstate $22 million following a settlement this week with the victim of a 2009 car accident. The agreement is the largest insurance bad faith settlement in Pennsylvania history, and the largest involving a motor vehicle accident in the nation, according to Ross Felley Casey, which represented the victim.