Value Of A Claim

A Texas Hill Country Insurance Lawyer will need to be able to discuss the value of a claim with a new client.  This discussion needs to be had along with a discussion of what court the case will be fought.  The Eastern District, Sherman Division, issued an opinion on how Federal Courts look at the value of a claim.  The opinion is styled, Tommy Wilson v. Allstate Insurance Company.

Tommy Wilson (Plaintiff) sued Allstate (Defendant) in County Court for losses under a homeowners policy.  Defendant caused the case to be removed to Federal Court based on diversity and the amount in controversy, stating the amount in controversy exceeds $75,000.00, which is the Federal Court minimal jurisdictional limits pursuant to 28 U.S.C., Section 1332(a).

Plaintiff argued that the amount in controversy was less than $75,000.00 and points to the following allegations regarding the amount in controversy alleged in his petition:

4.  Plaintiff sues for monetary relief less than $75,000, including damages of any kind, penalties, costs, expenses, pre-judgment interest, and attorney’s fees.  The damages sought are within the jurisdictional limits of the Court.

44.  At this time, Plaintiff cannot assess accurately a definite limit to the damages he has sustained or will sustain in the future as a result of Defendant’s acts.  Given the early state of this litigation, projections have not been declared regarding the full extent and severity of the damages.  In view of these circumstances, Plaintiff does not wish to impose any limit on what he may present to the jury or what the jury may consider as a range of damages in this case; however, he makes the following representation in compliance with Texas. R. Civ. P. 47(c) to aid in the efficient court administration.  Plaintiff believes that the most reasonable option afforded under Tex. R. Civ. P. 47, at this time, prior to the completion of in this case, is to seek monetary relief of less than $75,000.

In this case, Defendant has plausibly alleged in its Notice of Removal that the amount in controversy exceeds the jurisdictional threshold, pointing to the specific categories of damage alleged by Plaintiff’s state court petition.  This is sufficient to satisfy Defendant’s initial burden.  Plaintiff, has asked for a remand.

Defendant asserts that it is facially apparent that the amount in controversy exceeds $75,000:  Plaintiff’s request for compensatory damages, exemplary damages, attorneys’ fees, penalties and interest.  Additionally, Defendant produced evidence of a demand and accompanying estimate provided by Plaintiff, asserting the damage to his home that should be covered under his insurance policy exceeds $75,000.  More specifically, by letter dated September 14, 2016, Plaintiff directed a demand letter to Defendant.  Plaintiff’s total demand is in the amount of $70,011.98, and attached to the demand was an estimate to substantiate the figures.  The estimate is in the amount of $104,372.50, which exceeds $75,000.00.  This estimate is sufficient to establish by a preponderance of the evidence that Plaintiff’s claims exceed the jurisdictional amount.  Moreover, the Court further notes that the amount of economic damages claimed in the demand letter is $55,094.90.  Plaintiff’s suit seeks in addition to compensatory/punitive damages, exemplary (or treble) damages, which further substantiates that Plaintiff seeks to recover through his suit an amount in excess of the jurisdictional threshold.