Excluded Driver And Lenders

Fort Worth insurance lawyers would want to read this case from County Court @ Law #3 in Tarrant County. The case is styled Stadium Auto, Inc. v. Loya Insurance Company and the opinion was issued by the El Paso Court of Appeals.
Here is some relevant information.
Stadium Auto, Inc. appeals from a summary judgment granted in favor of Loya Insurance Company.
On March 10, 2009, Olga Salazar purchased a 2005 Ford Expedition from Stadium. Salazar financed the purchase through Stadium. On that same date, Loya issued a Texas standard auto policy to Salazar for the vehicle. The policy included an exclusion of named driver endorsement (also referred to as 515A Endorsement) and listed Junior Sanchez as an excluded driver. On April 30, 2010, Junior Sanchez was operating the vehicle when it collided with a car driven by Gilberto Adiel El Fuentes. According to Salazar, Sanchez took her keys out of her purse and drove the vehicle without her permission. Salazar stopped making payments to Stadium for the vehicle and she sought coverage under the policy for the vehicle. Stadium made demand on Loya under the loss payable clause of the insurance policy. Loya refused to pay based on the 515A Endorsement.
Stadium filed suit against Loya alleging that its denial of Stadium’s claim violated Section 541.060 of the Texas Insurance Code. The suit also alleged that Loya violated Section 17.46(b) of the Texas Deceptive Trade Practice Act by representing that the policy conferred rights, remedies, and obligations it did not have and the conduct constituted false, misleading, and deceptive acts or practices in the conduct of a trade or business such that it was subject to the remedies provided in Section 17.50. Stadium’s suit also included a claim that Loya was estopped from denying its liability based on the 515A Endorsement.
Stadium sued Loya under Section 541.151 of the Texas Insurance Code which authorizes a private action for damages.
More specifically, Stadium asserted that the loss payable clause, or the 530A Endorsement, provides coverage to the loss payee despite the named driver exclusion.
Stadium asserted that the 530A loss payable clause obligated Loya to pay Stadium the value of the vehicle. Loya filed a traditional summary judgment motion with respect to all of the causes of action alleged in the live pleadings. With respect to the violations of the Insurance Code, Loya contended that the summary judgment evidence established as a matter of law that it did not violate Section 541.060 because it did not misrepresent a material fact or policy provision relating to coverage. With respect to the alleged violation of Section 17.46(b) (12), the summary judgment motion asserted that Loya did not represent that the policy conferred rights, remedies, or obligations that it did not have, and the policy provisions are not the producing cause of Stadium’s actual damages. A person who sustains actual damages may bring an action against another person for those damages caused by the other person engaging in an act or practice.
Without going further into the arguments in this case, here is what needs to be realized in this situation and it is something an experienced Insurance Law Attorney may have been able to help with:
Olga had financed this car and had insurance which contained an excluded driver endorsement. The finance people tried to use Olga’s policy to get paid since Olga quit paying. The problem was they tried to claim innocence in regards to policy and its endorsement while they should have been pleading that the vehicle was stolen, since Olga said Junior took her keys and car without permission. A claim under the theft provision of the policy would have likely resulted in payment.