Insurance lawyers in the Dallas and Fort Worth, plus other parts of the state, need to read this 2022, United States 5th Circuit opinion. It is styled, Advanced Indicator And Manufacturing, Incorporated v. Acadia Insurance Company; Nicolas Warren.
Advanced asserts it suffered damage to the roof of its building as the result of the storm, Hurricane Harvey. Advanced submitted a claim to Acadia and Acadia assigned Warren to adjust the claim. Warren inspected the building and determined that the damage was pre-existing and leaks resulted from deterioration and poor workmanship. Based on Warren’s report, Acadia denied the claim.
On August 7, 2018, Advanced sued Acadia and Warren in state court, alleging various claims, including breach of contract, common law bad faith, and violations of the Texas Prompt Payment of Claims Act. On August 30, 2018, Acadia elected to accept responsibility for Warren under Section 542A.006 of the Texas Insurance Code, which provides that an insurer may accept liability for its agents. The next day, Acadia removed the case to federal court. One week later, Warren filed a motion to dismiss, arguing in part that Advanced could no longer state a claim against him. Advanced filed a motion to remand the case to state court, arguing that Warren was not improperly joined notwithstanding Acadia’s Section 542A.006 election. The remand was denied without reason by the District Court except to say that Warren was improperly joined.