Dallas Fort Worth Insurance Lawyer Blog

Lawyers Needed On Misrepresentation Claims

2012-05-19T14:36:49Z

Weatherford lawyers and those in Mineral Wells, Aledo, Azle, Springtown, Willow Park, Millsap, Brock, Cool, Hudson Oaks, and other places around Parker County need to know the different ways that a misrepresentation can occur.
The Austin Court of Appeals issued an opinion in 1997, that shows one of the ways a misrepresentation can occur. This case is kinda different.
The style of the case is, Apple Imports, Inc. v. Debbie Koole and Pete Resendez. Here is some of the relevant background.
This is an appeal by Apple. A jury found for Koole and Resendez and against Apple for violations of the Texas Deceptive Trade Practices Act (DTPA). This court upheld the judgment against Apple.
On Saturday December 3, 1994, Koole and Resendez visited Apple's automobile dealership and decided to purchase a used Mazda MX-3. As part of the consideration for the Mazda, they agreed to trade in their Dodge Dynasty. Due to the late hour, they were unable to complete the necessary papers to consummate the transaction before the dealership closed for the day. At an Apple employee's suggestion, they drove the Mazda home and left their Dodge at Apple, planning to return on Monday to finalize the paperwork for the purchase. Over the weekend, however, they changed their minds about buying the Mazda. When they returned to the dealership on Monday to give back the Mazda and retrieve their Dodge Dynasty, however, they discovered that Apple had already sold the Dodge to a wholesaler in Eagle Pass, Texas, without their authorization and without title to the car. Apple arranged to have the car returned from Eagle Pass on Friday, December 9, 1994. However, they did not pick up the vehicle until July of 1995. When recovered, their Dodge had an additional 800 miles on the odometer and a long scratch on the driver's side of the car that had not been present in December when they originally took it to the Apple dealership.
A lawsuit was the filed for DTPA violations among other things.
Apple argued that Koole and Resendez did not meet the definition of "consumers" under the DTPA. The court overruled this argument by pointing out that Texas Business & Commerce Code, Section 17.45(4) says to be a consumer requires two elements, (1) the person must seek or acquire goods or services by purchase or lease, and (2) the goods or services sought or acquired must form the basis of the complaint.
Apple argued that the Dodge Dynasty was a collateral service to the purchase of the Mazda and thus not a basis for the lawsuit.
The court said that the determination of consumer status is made by looking at the transaction from the plaintiff's perspective. From Koole and Resendez's viewpoint, the only transaction was the purchase of the Mazda MX-3. The trade-in of the Dodge Dynasty was simply a means to make the purchase. The planned trade-in was to form part of the consideration for the purchase of the Mazda and, therefore, was an integral part of the consumer transaction. The complaint arose out of a single transaction -- the attempted purchase of the Mazda.
Apple also contended the act of selling the Dodge was merely a mistake and did not constitute or create a misrepresentation. The court disagreed saying, when Apple took possession of the Dodge to determine its "trade-in" value, Apple made an implied representation. Violation of an implied representation has been held to constitute a violation of the DTPA.
Thus, the court said, when Apple took possession of the Dodge for the stated purpose of appraising it for its "trade-in" value, Apple impliedly represented that it would not sell the car until the transaction was completed and there was a clear showing of a valid complete transfer of ownership.
The use of the DTPA in the case by the attorney representing Koole and Resendez resulted in more justice than they would have recovered from other legal recourses. It showed Apple, the DTPA punitive sections are harmful to those businesses not following prudent business practices and can be a costly way of doing business.

Lawyers Arguing When A Representation Is Made

2012-05-17T17:38:18Z

Grand Prairie lawyers and lawyers in Fort Worth, Arlington, Mansfield, Irving, Hurst, Euless, Bedford, Grapevine, Garland, Mesquite, or anywhere else in Texas should understand when a representation is made in the context of a Deceptive Trade Practices Act (DTPA) claim for damages.
The Texarkana Court of Appeals issued an opinion in 1993, that provides guidance on this issue. The style of the case is, Dave Rickey v. Houston Health Club, Inc., d/b/a President & First Lady Health & Raquetball Club.
This is an appeal by Rickey from a summary judgment rendered against him in his suit against Houston Health Club (Health Club). Rickey alleged causes of action under both common law negligence theory and the DTPA for personal injuries sustained when he fell on the Health Club's astroturf jogging track. Rickey contended the trial court erred because he has both a viable negligence action and a viable DTPA claim against the Health Club.
Here are some facts:
On November 6, 1988, Rickey entered into a retail installment contract with the Health Club that allowed him to use the Health Club's facilities in exchange for an initiation fee of $616 and a monthly fee of $5.30. Rickey alleged that on March 4, 1990, he injured his knee when he tripped and fell on the Health Club's indoor jogging track. The track was covered in astroturf, which Rickey claimed was an inappropriate surface for a track because of its tendency to catch and grab a runner's shoe.
Legal Issues:
Rickey set out three DTPA causes of action alleging (1) that the Health Club violated Texas Business & Commerce Code, Section 17.46(b)(5) by representing that its jogging track had characteristics, uses, and benefits which it did not have, namely that it was safe for patron use; (2) that the Health Club violated Section 17.46(b)(7) by representing that the jogging track was of a particular standard or quality when it was not: and (3) that the Health Club violated Section 17.50(a)(2) by breaching an implied warranty insuring the suitability of the jogging track for its intended use.
Rickey did not allege that anybody with the Health Club made express verbal misrepresentations regarding the track, but an implied representation has been held to constitute a violation of the DTPA. Furthermore, the DTPA itself does not prohibit causes of action premised on implied representation. In this case, Rickey contended that since the Health Club held the astroturf track out as a jogging track, both at the facility and in its television advertisements, the Health Club implied that the track was safe for jogging.
Ruling
This appeals court agreed with Rickey, that a representation was made. And the important point here, is that the representation was "implied" rather than express. And Rickey's argument was that the representation was false and thus a misrepresentation which is actionable under the DTPA.
A lot of representations are common sense whether they are verbalized or written or not. Others are not so obvious and thus for a jury to decide. In this case, the court essentially said this was an issue for a trier of fact to decide and not a case that was appropriate for summary judgment.
This case and others like it are valuable to attorneys in understanding how the courts look at these situations. Understanding them makes for a better job of counseling clients on the merits of cases they bring to the attorney.

Misrepresentation By Seller

2012-05-15T13:50:28Z

Weatherford attorneys as well as attorneys in Mineral Wells, Aledo, Azle, Springtown, Willow Park, Hudson Oaks, Brock, Millsap, or anywhere else in Parker County can help their clients by understanding when a misrepresentation is made that violates the Texas Deceptive Trade Practices Act (DTPA).
A Houston Court of Appeals, First District, case decided in 1984, which sheds light on how to understand one of the ways a misrepresentation can be made. The style of the case is Lone Star Ford, Inc. v. John McGlashan & Teresa McGlashan.
This is an appeal from a judgment rendered in favor of the McGlashans in their suit for damages based on alleged deceptive trade practices. The case was tried without a jury. Finding of fact and conclusions of law were filed.
The McGlashans purchased a 1979 Ford Thunderbird vehicle from Lone Star in 1979. The McGlashans were unaware that the vehicle had a salvage title and that this title had never been transferred into their name. They found out two years later when trying to get a license for the vehicle.
Lone Star argued that there in not any evidence they ever told the McGlashans that Lone Star had good, clear, and marketable title to the automobile, nor that such title would be transferred to the McGlashans upon payment of the purchase price.
The McGlashans assert several violations of the Texas Business & Commerce Code, Section 17.46, otherwise known as the DTPA.
Lone Star says they could not have possibly violated the DTPA because they never made any representations regarding the clear and transferable title, and there was no duty to disclose the status of the vehicle's title.
The trial court said that the dealer's act of representing to used car buyers that he can provide them with a properly assigned certificate of title, and failing to do so, is a violation of the DTPA.
The court then said that the DTPA mandates that when a dealer represents that he can sell used cars, he necessarily represents that he can transfer a legal title to the new owner in order to consummate a valid sale. These two representations go hand in hand; otherwise, the dealer falsely represents that he can legally sell the car to the consumer.
So what does this ruling mean?
Here, there was never an actual oral or written representation made to the McGlashans. So, what the court said was the that the act of selling the car itself was an "implied" representation. And since the "implied" representation was false. i.e. Lone Star did not have title itself and thus was unable to transfer it to the McGlashans, they made a misrepresentation and the misrepresentation was a violation of the DTPA.
In this case, the judge went further. The trial judge found that the automobile purchased by the McGlashans was entirely unfit and useless for the purpose for which it was purchased, and that there was no reasonable market value for the automobile. This due to the salvage title.
This case, wherein a misrepresentation was found to be "implied" can be hard to apply to a lot of situations. What is important is that depending on the circumstances of a particular situation that even when there is nothing verbalized or written, that there can be an "implied" representation and if that representation turns out to be wrong, it becomes a misrepresentation to the consumer and that misrepresentation can be actionable as a violation of the DTPA.
The DTPA has remedies for the consumer when this happens.

Misrepresentations - Get Lawyer Help

2012-05-13T17:55:45Z

Lawyers in Weatherford, Mineral Wells, Aledo, Azle, Springtown, Cool, Brock, Millsap, Willow Park, Hudson Oaks, and other places in Parker County need to have an understanding of what a "misrepresentation" is in the context of being actionable under the Texas Deceptive Trade Practices Act. These misrepresentations also apply in the insurance context.
Many situations are obvious, but what about situations where it is not so obvious? Can a representation be implied?
Here is a case that provides some guidance. It is a 1984, opinion issued by the Dallas Court of Appeals. The style of the case is, Skeet Chambless v. Barry Robinson Farm Supply, Inc., and John Deere Company.
This is an appeal from a directed verdict in favor of Barry Robinson and John Deere wherein they were accused of violations of the the Texas Deceptive Trade Practices Act (DTPA).
Here is some background.
Chambless testified at trial that a clevis which was on a tractor at the time he saw and purchased the tractor was subsequently removed by Robinson prior to delivery of the tractor to Chambless. This fact was undisputed. Chambless testified at trial that he was never told that the clevis was optional equipment or that he would have to pay additional money in order to receive it and no evidence as to any such written representations was ever produced. The clevis was never delivered.
In discussing and ruling on this case in favor of Chambless, the court held that absent any representations (oral or written) to the contrary, by displaying the tractor with the clevis on it, Robinson represented that the clevis would be included in the sale of the tractor. The court held that, by displaying the tractor with the clevis on it at the time of the sale and refusing to deliver the clevis along with the tractor after the sale, Robinson misrepresented to Chambless what particular style or model tractor Chambless would actually be receiving, and that this misrepresentation was a violation of the DTPA. Section 17.46(b)(7) prohibits representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another.
The court said this misrepresentation may not have been intentional but the DTPA does not require intent or knowledge before a violation can be found.
This case is relevant in an insurance context also.
Many times an insurance agent is going to sit down with a potential new client and discuss with the client the needs of the client as those needs relate to insurance. This discussion may take place over several phones calls and emails or it may be one time in the agent's office.
What is relevant is that at some point the agent is going to recommend and sell a policy to the client. By doing so, the agent is implying that the policy meets the needs that have been discussed.
The next occurrence that happens is that the insured incurs a loss and makes a claim for benefits. When this claim is made, an insurance adjuster informs the insured that the loss is not covered under the policy they have or that the loss is only partially covered.
So what happens?
The insured needs to see an Insurance Law Attorney. If the insured can swear, under oath if necessary, that his needs were discussed with the agent and then upon making a claim, the insured discovers the agent did not sell the insured a policy that covers those needs, then the insured has a claim against the insurance agent for the misrepresentation.
The insured's argument is (1) they do not understand insurance (2) they could have read the policy word for word and still would not have understood the policy (3) that they relied on the insurance agent's expertise (4) that after discussing his needs the agent sold the policy at issue (5) that by selling the policy at issue the agent was representing to the insured that the policy was what the insured needed.
The courts have held that even though the representation was not written or oral, it was an implied representation, much like the case above. So when the "implied" representation turns out to not be as represented ... it is a misrepresentation.

Misrepresentations By Insurance Agent

2012-05-12T14:09:54Z

Attorneys in Grand Prairie, Irving, Arlington, Fort Worth, and other places in Texas need to understand the ways insurance law works and what constitutes a misrepresentation by an insurance agent.
Here is a case from 1990, that might be helpful in understanding a little bit of how this works. The case is styled, Preston Insurance Agency v. Daryl May et. al. and the opinion was issued by the Texarkana Court of Appeals.
Here is some background.
The Mays alleged that Preston and others negligently caused the loss of health insurance coverage for their son, which in turn caused them damages in unpaid medical and hospital bills, and mental anguish.
In 1982, on the recommendation of Daryl's mother, the Mays went to Preston to seek insurance coverage. They asked about a particular plan which could be purchased through United Services Association of America (USAA). By joining USAA, the Mays were eligible to purchase a group policy, which they did. USAA controlled the policy and had the power to replace the company. This group policy allowed the carrier to terminate the entire group at any time, but not as to individual members. This right was made clear. The policy also contained a deferral provision concerning dependents who were hospitalized or totally disabled at the time coverage began which provided for deferred coverage until (1) the dependent was engaged in all normal activities of a person in good health of the same age and sex, (2) there had been furnished satisfactory evidence of the dependent's insurabiity, and (3) the dependent was no longer confined to a medical facility.
The Mays had a son born in 1984, Jared. Jared suffered from serious medical conditions requiring hospitalization. The group insurance policy changed hands a few times and ended up with a company that discovered the condition of Jared and waived coverage as to him because he did not meet the requirements of the deferral rule contained in the policies.
The Mays sued Preston and the insurance companies involved and prevailed at trial. Preston filed this present appeal.
The Mays contended that Preston was negligent in placing their insurance in a plan inadequate to their needs and which exposed them to the possibility of having no coverage on their child.
The only fact asserted to be a direct cause of loss is that the group policies covering the Mays allowed the insurance company to terminate the policy as to the complete group, and that this termination right caused a "switching of underwriters" which ultimately left Jared without coverage. Thus, any liability of Preston, must be based on some negligence on its part in securing for, or inducing the Mays to purchase, that type of policy.
This appeals court then went over the evidence presented in the case. This evidence showed that there were discussions regarding the Mays and the fact that Ms. Mays had become pregnant and that the Mays were concerned that the insurance purchased cover their baby.
There was evidence of brochures being read and discussed regarding coverage and how it worked.
Ms. May testified that she was aware from conversations with Preston that any of the carriers who had the group policy could cancel the entire group, and that she had received a letter from USAA at one point, informing her that the group was being cancelled. She was also aware from what Preston told her that the cancellation could happen and that there was nothing USAA could do about it if the new carrier decided to cancel the policy.
In making a final ruling this court ruled in favor of Preston. In doing so the court stated, "An insurance agent or broker is not liable for an insured's loss of claim or coverage, unless at the time the policy is purchased or at some later time when the insured could be protected, the agent knows or should know of facts which would put a reasonable agent on notice that the insurance presents an unreasonable risk, and then fails to use reasonable care to protect the insured. When the insured is fully apprised of the risk, and voluntarily chooses the policy and accepts that risk, the agent's act in placing the coverage is not a proximate cause of the loss."
The court went to point out that the undisputed evidence in this case showed that the Mays were fully aware of the termination right contained in the policy they chose, and were fully aware that if the insurance company chose to terminate the policy as to the whole group, as it had a right to do, they and their dependents could lose coverage.
This case is difficult for the insureds. However, it does a good job of pointing out the requirements / burdens on the agent. An experience Insurance Law Attorney being aware of these requirements / burdens helps provide guidance for evaluating the merits of a case and thus in valuable for advising a client how to approach their particular situation.

Insurance Lawyers Needed In Texas

2012-05-10T17:05:05Z

People in Weatherford, Mineral Wells, Aledo, Azle, Springtown, Cool, Willow Park, Hudson Oaks, Millsap, Brock, and other places in Parker County will often times find themselves needing an Insurance Lawyer, whether they want one or not.
KSAT posted an article in April, 2012, that gives an example how an insurance company takes advantage of their insureds.
The article, written by April Molina, tells us that a San Antonio woman is going out of pocket more than $5,000 after a leak ruined her floors.
"If I stepped on the wood, water just came up from between the wood flooring slabs," said homeowner Kim Moore.
Moore said she was surprised to see the damage caused by the leak, but she was even more surprised after hearing back from her insurance company.
"He said, 'I can tell you that you're not covered for water damages in the foundation or under the foundation,' and that threw me for a loop." said Moore.
After a short visit from an adjuster, it was determined the leak did not originate from the foundation, but from behind the stove.
"I called the 800-number, they returned my call within a half an hour and then I was informed I had no water damage insurance of any kind." Moore said.
Long time insurance agent Don Whitaker said it is unusual to have no water damage coverage on a Texas homeowner's insurance policy, but it is not unusual to have only partial water damage coverage.
Of the three types of coverage, it is the most common to have a clause that covers sudden and accidental discharge of water from a plumbing, heating, or air-conditioning device.
The other two types could come at an additional expense.
"You have to buy back by endorsement and by cost, backup sewer lines from water and you have to buy back water damage to your foundation," Whitaker said.
In a competitive industry, it is important to be a conscientious consumer. If you don't pay for proper coverage up front, you may end up paying much more for it on the back end.
The described situation in this KSAT article above, is a great example of what happens too many times. Seeing an experienced Insurance Law Attorney might get Ms. Moore compensated.
There is an another story, this one from Texas Watch worth knowing about. Here is what the article tells us:
The Texas Department of Insurance received an "F" from the State Integrity Investigation's Public Corruption Scorecard, a 50-state survey of public institutions and their susceptibility to corruption.
"This report confirms what Texas policyholders have known for years: the insurance industry holds too much power and sway in our state," said Alex Winslow, executive director of Texas Watch, a statewide citizens advocacy organization active on insurance issues. "Conflict of interest rules are weak and ineffective, the public doesn't have access to crucial information, and the TDI received a 58% on its scorecard.
The agency scored particularly low on the effectiveness of conflicts of interest regulations despite the existence of rules governing conflicts of interest.
The scorecard found the potential for political interference in agency decisions to be very high.
The scorecard pointed out that key documents submitted to TDI by insurance companies are not subject to public disclosure. (TDI is currently considering comments for a rule to clarify what documents included in rate filings are open for public disclosure.)
TDI scored highly in terms of having the professional staff and state resources to carry out its mandate.
15 other state insurance commissions received failing grades.
Both articles underline the need for insurance lawyers in Texas. Both articles lend evidence to the ideal that individual lawyers acting on behalf of their clients are the only thing really helping insureds at this time.

Insurance Lawyer And Why You Need One

2012-05-08T14:03:31Z

Policy holders in Weatherford, Mineral Wells, Aledo, Azle, Springtown, Willow Park, Hudson Oaks, Millsap, Brock, and other places in Parker County need to understand important reasons for seeing an Insurance Law Attorney.
The El Paso Court of Appeals issued an opinion on April 11, 2012, that is a good illustration for the involvement of an Insurance Law Attorney. The style of the case is, Amy Warmbrod v. USAA County Mutual Insurance Company.
Here is some background:
Warmbrod sustained severe injuries in a car accident. She was treated free of charge at United States Army hospitals by virtue of her husband's military status. Her injuries and damages were in excess of both the tortfeasor's insurance coverage and the underinsured motorist's (UIM) provisions of her own USAA auto insurance policy. She demanded that USAA pay her the $100,000 UIM benefits under her policy. The Army submitted a reimbursement claim to USAA for the medical care it rendered in the amount of $26,404.96 pursuant to 10 U.S.C. Section 1095 and the Federal Medical Care Recovery Act, (FMCRA) 42 U.S.C. Sections 2651 - 2653. After USAA paid the Army, Warmbrod sued USAA for violations of the Texas Deceptive Trade Practices Act and the Texas Insurance Code and other legal reasons. The heart of the complaints against USAA were that the payments to anyone besides Warmbrod were improper.
USAA filed a motion for summary judgment, asking the court to rule as a matter of law that they had committed no wrongs.
Warmbrod argued the "made whole" legal doctrine as part of her claim.
FMCRA is one of the federal statutes that gives the United States government the authority to recover medical care it provides at its own expense to covered beneficiaries.
The court discussed at length the provisions of the federal law and how it applied to this case.
They also discussed the Texas Insurance Code provisions dealing with the purposes of UIM coverage and how UIM coverage is suppose to work.
In this case, USAA prevailed. What is important about this case to insureds such as Warmbrod and to Insurance Law Attorneys is being aware of the numerous laws that exist regarding the different obligations that arise when injury claims are made against the person who caused the injury and the even against the injured person's own coverage.
Other posts have discussed the obligations regarding hospital liens, subrogation interests, assignments, etc. This case illustrates yet another concern that has to be resolved.
It is important to bear in mind several repercussions of failing to adequately protect the various interests that can arise when these other interests are not properly protected. The insurance company that improperly pays benefits can be liable for the interests of the person or entity that is not properly protected. In addition, the injured person can be liable for those interests not being properly protected.
The liability of the injured person collecting benefits can include being financially responsible for monies improperly paid. Additional liability can include losing future benefits. Further still, in some cases a person can be criminally liable for not protecting the interests of these other entities.
The bottom line is that getting injured and settling with an insurance company (not talking about health insurance) without an experienced attorney being involved can add a nightmare on top of the nightmare that was being lived as a result of the original injury. Talk to an attorney before accepting any insurance benefits or claims.

Personal Injury Protection Benefits Rejection

2012-05-06T18:57:18Z

People with auto coverage in Weatherford, Mineral Wells, Aledo, Millsap, Azle, Springtown, Brock, Willow Park, and other places in Parker County might think they have Personal Injury Protection (PIP) benefits, when they actually do not.
The Austin Court of Appeals issued an opinion in 2003, that can be a little confusing. The style of the case is, Kathryn Payne and Carnell Gulley v. Mid-Century Insurance Company of Texas. Here is some background.
Payne and Gulley filed a lawsuit against Mid-Century alleging they were entitled to PIP benefits under the terms of an auto liability policy issued by Mid-Century. Both sides filed motions for summary judgment and the trial court ruled in favor of Mid-Century. On appeal, the trial court ruling was sustained.
Certain facts were agreed upon: The same insurance agent had written policies on the family since 1991. In 1994, Kathryn's mother purchased a policy naming Kathryn as the rated driver and signed an agreement deleting PIP coverage. Thereafter, Kathryn and her parents, Wanda and Rodger were named insureds in a Farmers policy. In 1996, Kathryn signed an agreement rejecting PIP coverage in connection with that policy. The waiver provided that the "rejection shall apply on this policy and all future renewals or replacements of this policy."
In 2001, the policy cancelled and the Mid-Century policy became effective and was the policy in effect at the time of the accident in issue here. Wanda Payne had signed a PIP rejection but Kathryn had not. The declarations page reflected no PIP coverage and no premiums were paid for the coverage.
Texas Insurance Code, Section 1952.152, states that PIP coverage in automatically in every policy issued in Texas unless it is rejected in writing.
Mid-Century lawyers alleged two reasons for denying coverage: (1) the Mid-Century policy was a renewal of the earlier policy by an affiliated company, Farmers, therefore Kathryn Payne's 1996 waiver of coverage in connection with the Farmers policy applied to the Mid-Century policy, and (2) Wanda Payne's 2001 waiver of PIP coverage was effective as to the Mid-Century policy because she was both an "insured under the policy" and Kathryn Payne's agent authorized to waive coverage on her behalf.
Payne on the other hand, says the written rejection by Kathryn signed in 1996 was ineffective as to the Mid-Century policy for two reasons. First, although the Mid-Century policy might be considered a replacement of the Farmers policy, it could not be a renewal because the earlier policy insured three persons, Kathryn and her parents, while the Mid-Century policy covered only Kathryn. Further, Kathryn's written rejection agreeing that it applied to replacement policies was of no effect because the statute only provided that such a written rejection applied to a renewal policy.
The court in making it's ruling stated that by using the term "renewal policy" in the statute, the legislature intended the term to include a new contract between parties that replaces a preceding policy without a lapse of coverage. In discussing further, the
Court stated there is no authority for an assertion that a renewal policy must have identical parties and terms as the earlier policy.
In it's closing statement the court said, "We hold that under these facts, the Mid-Century policy was a renewal policy. Thus, Mid-Century was not required to provide PIP in its policy because Kathryn rejected the coverage in writing in connection with the issuance of the Farmer's policy, and a policy previously issued to her by an affiliated insurer."
There is a lot of case law dealing with the PIP statutes and there have been some revisions and new interpretations of these laws. An experienced Insurance Law Attorney would be up to date on these laws and the changes in the laws. He would be able to give proper advice for most disputes arising under these laws.

Personal Injury Protection And Fraud

2012-05-05T14:48:01Z

People in Weatherford, Mineral Wells, Aledo, Azle, Springtown, Millsap, Willow Park, Hudson Oaks, Brock, Cool, and other places in Parker County need to be aware of the Personal Injury Protection (PIP) benefits in their auto policy.
Most people have have these benefits do not even know how they work. All they know is that when they talked with their insurance agent they told the agent they wanted "full coverage" and as a result of that directive they ended up with PIP. It is a good coverage to have and there are laws regulating this coverage in the Texas Insurance Code.
These PIP laws are found in Sections 1952.151 thru 1952.161.
In Florida, there is an attempt underway to regulate PIP in such a way as to hopefully reduce fraud and as a result to hopefully reduce premiums for this coverage.
The Miami Herald ran a story on April 1, 2012, titled "Time Will Tell If New Law Fixes Rampant Car Insurance Fraud." The story is authored by Tia Mitchell and deals specifically with PIP.
The Florida division of Insurance Fraud reports people committing fraud in staging accidents and collecting thousands of dollars in insurance money. In response to this fraud the story tells us that the Florida legislature has passed a law that is intended to reduce this fraud and reduce insurance rates. The relevance of this Florida law to Texans is that if the law proves to be effective in Florida, it is likely something that will eventually be passed and enacted in Texas also.
The measure includes a requirement that insurance companies reduce PIP premiums at least 10% by Oct. 1 and 25% by 2014.
One of the stated goals of this legislation is to put PIP back into its original character as emergency treatment to get a person back on their feet. As part of that effort, the new law bars massage therapists and acupuncturists from treating patients under PIP. Those services have been contributing to rising costs, and are deemed less necessary than other treatments.
Beginning in 2013, people injured in auto accidents will have 14 days to seek initial treatment - under current law there is no cutoff - and that first visit will carry more weight.
Only people diagnosed with an "emergency medical condition" will be eligible for the full $10,000 PIP benefit. Medical doctors, osteopathic physicians, dentists, physician assistants or advanced registered nurse practitioners will be authorized to make the determination.
Those with less severe injuries will receive only $2,500. Soft tissue injuries that are common in car accidents, such as soreness, swelling and bruising, are not expected to be considered emergencies.
Supporters of this new law say that this is how the system is supposed to work because PIP was intended to help people only with their immediate needs after an accident. Letting other types of insurance such as the at fault drivers liability coverage or private health policies take care of the rest, is the goal.
Another change in current law is clearing up ongoing disputes about how costs should be calculated by factoring in the fee schedule under Medicare. It also clarifies that insurance companies can examine patients under oath when investigating possible fraud, and eliminates a provision that allowed Judges to drastically increase the amount of fees awarded to the attorneys of injured people.
It is worth noting that this Medicare fee schedule fix was tried in 2007 and resulted in a drastic increase in disputes that ended up in court.
The Florida Justice Association, which represents trial lawyers, says there is no question but that the number of PIP lawsuits will increase. This is because the "emergency medical condition" definition will be an issue. Two examples of this are (1) is it going to be up to a court to determine whether a certain kind of sprain is an EMC, or (2) a bulged disc in the spine is an EMC.
Texas has often followed Florida in tort reform laws. That is essentially what this law is. So, that means this law may very well be coming to Texas in its next legislative session.

Vacancy Clause In Homeowners Policy

2012-05-03T17:12:05Z

A person in Weatherford, Mineral Wells, Aledo, and other places in Parker County who has a homeowners policy would find the following case of interest.
At one time or another a house or residence is going to be vacant for a period of time. Maybe it is when remodeling is being done, or if the property is a rental, there may be a vacancy when a tenant moves out. There may be a temporary vacancy when a house is up for sale. There can be many situations where a structure is temporarily vacant. What most people do not realize is that almost all policies have vacancy exclusions written into the policy. The insured customer discovers this only when they are making a claim and the adjuster assigned the claim determines the vacancy exclusion is applicable and denies the claim for benefits.
The Fort Worth Court of Appeals issued an opinion recently that dealt with the vacancy clause exclusion in a homeowners policy. The style of the case is, Columbia Lloyds Insurance Company v. Robert Mao and Vachana Mao.
Here are some of the facts:
Columbia Lloyds issued a Texas Dwelling Policy that named Vachana Mao as insured and covered a rental house that she owned. After a fire occurred at the dwelling, Vachana reported the loss to Columbia and Columbia denied the claim based on the vacancy clause.
Both parties to the lawsuit filed motions for summary judgment related to the vacancy clause and the trial court granted summary judgment on the issue in favor of Mao. This appeals court reversed this finding based on the following.
The policy covered rental property and a detached garage. The vacancy clause stated, "During the policy term, if an insured building is vacant for 60 consecutive days immediately before a loss, we will not be liable for a loss by the perils of fire and lightning or vandalism or malicious mischief. ..."
Columbia received a phone call from Vachana reporting a fire had damaged the insured dwelling. The phone call indicated the house was vacant per the insured - that the tenant had moved out.
An adjuster assigned to the claim took photographs and determined that there were no contents in the house. He also determined the house was a total loss, that the origin of the fire was undetermined, and that the house had been vacant for more than sixty days.
Based in this information and the vacancy clause, the claim was denied.
Vachana challenged this finding and later submitted to an examination under oath. In this examination she stated all the prior tenant's furniture had been moved out, and the insured dwelling was "completely vacant." She said that there was a sofa, an old bed, a gas range, and a refrigerator in the detached garage but that these appliances were not "hooked up." She explained that the house was in the process of being remodeled but that the contractor was taking a long time finishing the job and been coming in and out of the house.
In discussing the case, the court pointed out that the insurance policy did not define "vacant." The term vacant has been defined by case law as an "entire abandonment, deprived of contents, empty, that is, without contents of substantial utility."
The court examined the facts set out above. They also looked at a statement by the claim adjuster wherein he stated that he did not have any information that the Maos had abandoned the property. That she knew they were remodeling the home and they were trying to sell it.
Evidence that the home was in the process of being renovated and not yet complete was also important to the Court. Further evidence showed that the utilities actually were connected because the house was being shown to potential buyers approximately twice a week and that Vachana had been in the home the week before the fire.
The Court pointed out that all the above could be evidence that the house was vacant and was evidence that it was not vacant. Since a reasonable trier of fact could differ as to their conclusion, it was improper for a summary judgment to be granted to either party on that issue.
Vacancy clauses in policies are a common reason for the denial of benefits. An experienced Insurance Law Attorney has probably dealt with this issue many times. He would know ways to get the insurance company to pay on these claims. Without this experienced help, the insurance company would win.

Insurance Playing Games

2012-05-01T14:22:05Z

Most people in Weatherford, Aledo, Azle, Willow Park, Hudson Oaks, Springtown, Millsap, Brock and other places in Parker County probably already know this but here goes. Did you know an insurance company will play games with you that are designed to separate you from money to which you are entitled.
The answer to the above is illustrated by Reuters article that was on line recently. The title of the article is, "As Weather Gets Biblical, Insurers Go Missing." The arthur is Matt Stroud. The article tells us how insurance companies are playing games with insurance policies when weather gets bad. For example, many homeowners get hit with the loss of their insurance policies after making claims resulting from weather disasters.
A person in Springfield, Massachusetts, a retired school teacher, found broken windows, missing siding, and a damaged roof after a recent tornado. Her insurance company offered to pay for one window and some of the siding. It ended up taking her nine months and working with an independent adjuster, the Massachusetts Division of Insurance, and a mediation before getting compensated.
Insurance companies are raising rates, cutting coverage, balking at some payouts, and generally shifting more expense and liability to homeowners.
"Insurance companies have significantly and methodically decreased their financial responsibility for weather catastrophes like hurricanes, tornados and floods in recent years," according to the Consumer Federation of America,
What needs to be realized by consumers is that the insurance companies largely agree with the above statement. A spokesman for the Insurance Information Institute, an industry trade group, says, "Insurers have taken a step back to assess whether or not they can absorb severe losses."
Insurance companies have gone as far as pulling out of states that are prone to weather disasters.
As an example, Allstate pulled out of North Carolina, after Hurricane Ike last summer unless insurance contracts on homes are bundled with auto policies.
Alfa Mutual Group has announced it will not be renewing Alabama property insurance policies.
Lots of insurers have chosen to pull out of Florida, going back many years. Florida has the second highest rates in the country with an annual average of $1,460. Guess who is the highest? Texas, with rates at $1,511.
In Florida, the state has had to step in to cover properties via its publicly funded Citizens Property and Insurance Corporation.
Even where companies are not leaving states at will, many opt to drop coverage on individual homes and customers, particularly those that are more prone to file claims.
One way of fighting back is actually pretty simple. Shop around.
Many customers find better coverages and at lower prices by shopping around and staying with the same company all the time with the feeling that you are dedicated to those particular insurers.
The insurance companies take the position that they are managing their risk. This position may make sense in some situations. However, it is important to realize that the insurance company is still liable for any loss that occurs while the policy is in force. Just keep in mind that because of the loss that occurred, there are two bad possible follow ups by the insurance carrier. One is to choose to cancel or non-renew the policy. The other is to significantly raise the rates being charged.
One big way to get assistance in shopping for a new policy for both lower rates and better coverage, is to seek out an independent agent. It is probably obvious that an Allstate agent is going to push Allstate policies and that State Farm agents are going to push State Farm policies. This is some times confusing in that the respective agent says he will shop around. All the agent is actually doing is looking at couple of other policies that their respective company may have and or changing the coverages.
Whenever something "doesn't seem right" contact an Insurance Law Lawyer for advice.

Credit Disability Insurance Policy

2012-04-29T18:02:35Z

Car buyers in Grand Prairie, Fort Worth, Arlington, Dallas, Grapevine, Keller, Saginaw, and other Tarrant County cities should pay attention to this case. It shows how complicated some of the "Credit Disability Insurance" policies can be.
The opinion in the case was issued by the Houston Court of Appeals, First District, in December of 2011. The style of the case is, Bernice Hudspeth v. Enterprise Life Insurance Company. Here is some background.
On July 5, 2003, Hudspeth purchased a car from a dealership. In conjunction with that purchase, she also bought a disability insurance policy to cover her car payments in the event of her disability. It was a "reducing" policy, meaning that the value of the insurance declined when each car payment was made reducing the balance owed on the vehicle. The back of the credit insurance contract contained the following provision defining disability in a section entitled "DISABILITY INSURANCE COVERAGE":
TOTAL DISABILITY: means Disability resulting from sickness or injury and which begins while the coverage is in force and causes the insured to be unable to perform the usualy and customary duties of the Insured's current occupation at the time the disability occurs. The definition changes after twelve (12) consecutive months of Total Disability and requires that the insured be unable to perform the duties of any occupation for which the insured is reasonably qualified by education, training or experience. The Company will not pay disability benefits on the Insured's behalf unless a doctor of medicine or osteopathy who is licensed by the State Board of Medical Examiners certifies the Insured's Total Disability to the Company. The insured will be required to give the Company written proof of continuing Total Disability at monthly intervals in order to justify the continuing payment of benefits.
The following provisions related to specific claim procedures are included in a section entitled "RULES FOR FILING A DISABILITY CLAIM":
NOTICE OF CLAIM: Written notice of the Insured's claim must be furnished within 20 days after the loss occurs or as soon as reasonably possible.
CLAIM FORMS: The Company will furnish a claim form for filing proof of loss within 15 days, upon request. If a claim form is not received within 15 days, the claimant may submit written proof of disability signed by a licensed physician including the date and cause of the total disability to the Company.
PROOF OF LOSS: Written proof of loss must be furnished to the Company within 90 days. Any subsequent written proof of the continuation of the disability must be furnished to the insurer at such intervals as the insurer may reasonably require. Failure to furnish such proof within the time required shall not [illegible] nor reduce any claim if it was not reasonably possible to give proof within such time, provided such proof is furnished as soon as reasonably possible and in no event, except in the absence of legal capacity, later than one year from the time proof is otherwise required.
...
This writer is going to stop now with the conditions in the policy. The reader needs to know why people such as Hudspeth are forced to seek the assistance of experienced Insurance Law Attorneys to preserve their rights.
In this case, the claim was denied. Hudspeth had to hire an attorney who was forced to file a lawsuit on behalf of Hudspeth. During the law suit there were at least two motions for summary judgment filed. These being attempts to get the case thrown out of court. The conditions listed above are only a partial list of the conditions.
Hudspeth, who became very ill and was unable to work due to a diagnoses of cancer and subsequent surgery, lost her normal health insurance and was forced to see government medical care. Due to the change in medical providers she had complications with getting paperwork properly completed by physicians who were primarily interested in providing medical care, not filling out continuing forms for insurance companies. Thus, this was one of several reasons why Hudspeth was unable to dot all the i's and cross all the t's that Enterprise was requiring for Hudspeth to receive benefits.
In the end, Hudspeth prevailed on some of her claims and had less than satisfactory results on other parts. Getting help as soon as it becomes obvious that a claim is not getting processed promptly is key to getting the entire case resolved in a more satisfactory way.

Need Insurance Law Attorney For GAP Insurance

2012-04-28T13:52:16Z

People in Weatherford, Aledo, Azle, Willow Park, Hudson Oaks, Springtown, Millsap, Brock, Mineral Wells, and other places in Parker County need to know when it is time to get an experienced Insurance Law Attorney.
The Houston Court of Appeals, First District, issued an opinion in 2009, that is worth reading. The style of the case is, Russell W. Harrison v. Charlie Thomas Ford, Ltd. D/B/A Charlie Thomas Ford. This is an appeal from a summary judgment granted in favor of Charlie Thomas Ford.
The background facts of the case is not real relevant here because the case was essentially resolved based on statutes dealing with the sale of credit and GAP insurance.
Procedurally, Harrison alleged that Charlie Thomas Ford sold GAP insurance in a manner that did not comply with Finance Code, Section 348.209 and Insurance Code, Section 4055.014.
Harrison claimed the following statute applies to a motor-vehicle installment sale:
Section 348.209. Requirements for Including Insurance Cost in Contract
(a) If insurance is included as an itemized charge in a retail installment contract:
(1) the insurance must be written:
(A) at lawful rates;
(B) in accordance with the Insurance Code; and
(C) by a company authorized to do business in this state; and
(2) the disclosure requirements of this section must be satisfied.
Harrison then pointed to the following statute in the Insurance Code:
Section 4055.014. Disclosures Required Before Issuance of Insurance
Except as provided by Section 4055.105, insurance coverage may not be issued under this chapter unless:
(1) at each location at which sales of the coverage occur, brochures or other written materials are prominently displayed and readily available to a prospective consumer that:
(A) summarize, clearly and correctly, the material terms of the coverage afforded to consumers, including the identity of the insurer;
(B) disclose that the coverage offered by the specialty license holder may duplicate coverage already provided by a consumer's personal auto insurance policy, homeowner's insurance policy, personal liability insurance policy, or another source of coverage;
(C) state that, except as specifically provided by another law of this state or the United States, the purchase by the consumer of the kind of insurance offered is not required to complete the associated consumer transaction;
(D) describe the process for filing a claim for benefits; and
(E) contain any additional information required by the commissioner by rule regarding the price, benefits, exclusions, conditions, or other limitations of the coverage; and
(2) evidence of coverage is provided to each consumer who purchases the coverage.
Harrison concludes in his papers filed with the court "it is undisputed that the insurance is in fact sold in a manner that does not comply with the requirements of the Texas Insurance Code ...."
As the Court pointed out, there is a problem with Harrison's argument in that there is an exception to Insurance Code, Section 4055.014. He is ignoring Insurance Code, Section 4055.105.
Section 4055.105 is titled "Exemption From Certain Disclosure Requirements."
It says:
"A specialty license holder and the license holder's representative are not required to make the disclosures required by Section 4055.014 as that section relates to the sale or delivery of a credit insurance product that is subject to this subchapter if the license holder or representative complies with all disclosure requirements prescribed by another provision of this code or another law of this state or the United States with regard to the sale or delivery of that product."
Accordingly, this Court upheld the grant of summary judgment by the trial court.
It is hard to be critical of what happened in this case without knowing more about the underlying facts, but for whatever reason Harrison appears to have "cherry picked" a part of law that was helpful to his case and ignored other parts of the law. This is rarely or never going to work.

Credit Insurance Policy

2012-04-26T18:11:25Z

Credit policies sold in Grand Prairie, Arlington, Mansfield, Fort Worth, Dallas, or any other place in Texas are regulated by the Texas Department of Insurance and the Texas Insurance Code. This means that when one of the policies are denied when an application for benefits is made, that an experienced Insurance Law Attorney should be consulted so that a beneficiary's rights are not wrongfully denied.
Here is a case that was strange.
This is a 2001, case that was decided by the Beaumont Court of Appeals. The style of the case is, Paula Guillory v. Service Life and Casualty Insurance Company. Here is some of the background on the case.
This is an appeal from an order granting summary judgment in favor of Service Life. The lawsuit was originally brought for numerous allegations resulting from Service Life denying a claim for benefits. The allegations included violations of the Texas Deceptive Trade Practices Act (DTPA), negligence, breach of contract, and violations of the Texas Insurance Code. The face amount of the credit life insurance policy was $21,430.80.
The gist of Paula's allegations was that she and her father, Paul Isaac Colligan, executed an application for credit life insurance in the course of the purchase of a vehicle; that Mr. Colligan listed various physical infirmities from which he was suffering at the time; that about six months later, Mr. Colligan died of pancreatic cancer which was diagnosed only three weeks before his death; that when Paula filed to collect the insurance proceeds on the vehicle so as to pay the balance owed, she was informed by Service Life that the credit life application had been rejected because Mr. Colligan was not truthful on said application regarding his health status.
The claim made by Service Life was that Paula was not entitled to recover in the capacity in which she sued. The entirety of the substance of Service Life's motion for summary judgment is reproduced here as follows:
"Defendant is entitled to summary judgment because the Plaintiff, Paula Guillory, is not the insured or the beneficiary under the Policy. Therefore, Plaintiff lacks an essential element to any cause of action, the legal capacity to sue.
Under Texas law there are two basis for subrogation, the first is contractual and the second is equitable. There is no basis for contractual subrogation because Paula Guillory is neither the insured nor the beneficiary under the policy. The insured is Paul I. Colligan, the first beneficiary is GMAC, and the second beneficiary is the Estate of Paul I. Colligan. Likewise, there is no basis for equitable subrogation because Paula Guillory, as the Co-Buyer on the retail installment contract, is primarily liable for the debt to GMAC."
Service Life says it included as part of the evidence the following (1) the affidavit of Barbara Marsh, authorized representative of Service Life and Casualty Insurance Company; (2) the Retail Installment Contract, attached to the affidavit of Barbara Marsh; and (3) the Credit Life Insurance Policy, attached to the affidavit of Barbara Marsh. However, a copy of the Credit Life Insurance Policy was not to be found.
The court in discussing this case ultimately said: As party to the credit life application, Paula had capacity to bring a lawsuit against the other party to the lawsuit. Regardless of whether she was a "third-party beneficiary," as she claims in her response, Service Life had the burden to provide summary judgment proof that Paula lacked "capacity" as a matter of law. If the credit life insurance been in effect at the time of Paul Colligan's death, the court inferred that the terms of the policy permitted the balance of the installment contract to be paid off, thus wiping out Paula's personal liability for the balance of the debt to GMAC.
This case can be a little confusing but illustrates the extent some insurance companies will go to keep from paying a claim

Credit Life / Disability Policies

2012-04-24T13:12:37Z

Car buyers in Grand Prairie, Arlington, Fort Worth, Mansfield, Dallas, Mesquite, Garland, and other places in North Texas should be interested in this case.
The case is from 1996, and was decided by the Austin Court of Appeals. The style of the case is, American National Insurance Company and Heart of Texas Dodge v. Rosemary Paul and Don Paul. Here are some of the facts.
On February 16, 1993, the Pauls purchased a van from Dodge. Before this date, Mr. Paul negotiated the purchase terms of the van with one of Dodge's agents. Mr. Paul asked the sales agent whether the purchase price included credit disability insurance. The agent responded that he did not know. Beyond this inquiry there was never any discussion of whether credit disability insurance was to be included in the transaction.
On the day of the purchase, the Pauls arrived at the dealership during Mrs. Paul's lunch hour in order to meet the finance officer and close the deal. After waiting a short while, the Pauls informed a Dodge agent that they were in a hurry and that if they could not meet soon, they would have to return later. Shortly thereafter the Pauls met with the finance agent who prepared the documents for a 72-month financing term for the van purchase. The documents also contained an application for credit disability insurance to be provided by American National.
The finance manager did not orally disclose the existence of the credit insurance application to the Pauls. The Pauls did not read the paperwork, and they signed all the documents where instructed by the finance agent. Consequently, the Pauls were unaware that they were purchasing credit disability insurance.
The application contained a paragraph entitled "Applicant's Statement," which required the applicant to state that she was in good health and had not within the last three years consulted a doctor for certain conditions, including treatment of the nervous system. Mrs. Paul signed the statement even though at the time she suffered from amyotrophic lateral sclerosis, commonly known as "Lou Gehrig's Disease," a terminal and degenerative illness affecting the nervous system. She had consulted a doctor regarding her condition within the last three years.
The trial court made a finding that Mrs. Paul did not intend to deceive or induce American National into issuing the policy.
As of April 1, 1994, Mrs. Paul became totally and permanently disabled and was unable to continue working. On May 5, 1995, pursuant to the credit disability insurance policy, she applied for disability insurance benefits, which American National denied.
The Pauls filed this lawsuit alleging breach of contract, violations of the Texas Insurance Code, and violation of the Texas Deceptive Trade Practices Act (DTPA).
Here is some of the legal discussion.
American National argued that Mrs. Paul's good health constituted a condition precedent to the insurance contract and since she was not in good health the contract was never effectively consummated. The Pauls responded that the Applicant's Statement was merely a representation.
In order to rescind the contract due to the Pauls misrepresentation, they must have made the misrepresentation with the intent to deceive. There was no allegation by American National that the Pauls intended to deceive. Their argument was solely reliant on her medical condition being a condition precedent.
There was then a discussion about the difference between a misrepresentation and a condition precedent. The importance between the two being that for American National to be able to void the policy due to a misrepresentation they would have to show an intent on the part of the Pauls, which they did not even attempt. To void the policy due to the failure of a condition precedent would be successful avoidance for American National, but the court interpreted the language to be that of a misrepresentation not that of a condition precedent.
Much of the law regulating these credit life / disability policies is found in the Texas Insurance Code. Of relevance is Section 705.004, which says a misrepresentation is of no effect unless certain elements are shown.
Anyone who has one of these types of policies who finds their claim being denied needs to consult with an experienced Insurance Law Attorney. Most of these denials can be defeated.