Articles Posted in Claims Denial

A misrepresentation in an insurance application is grounds for denial of a claim but it is not necessarily a win for the insurance company.  This issue is discussed in a recent opinion from the Texas 14th Court of Appeals.  The opinion is styled, Jose Palma v. Allied Trust Insurance Co.

This case was a summary judgment win for the insurance company but there is a clear distinction with this case and the vast majority of cases regarding misrepresentations.

Palma purchased an insurance policy for his home with appellee.  During the policy period, there was a fire at Palma’s home.  Palma submitted an insurance claim under the policy.  Allied investigated and found that Palma had a prior conviction for insurance fraud that was not disclosed on his application for

Here is a 2023 opinion from the Northern District of Texas, Dallas Division worth reading when it comes to determining whether the insurer and the insured have reached a settlement agreement.  The opinion is styled, Brenda Kirby and Gary Kirby v. State Farm Lloyds’, Evan Kingery, and Kimberly Scholes.  The opinion deals with other issues and the facts make a good read along with the legal history.  We will focus on whether or not there was a settlement agreement.

After the lawsuit was filed, Defendant’s filed a motion to enforce a settlement agreement.  For support, State Farm submitted copies of the above referenced e-mail correspondence exchanged by counsel for the parties on January 18, 21, 24, and February 2, 2022. Defendant contends that this correspondence clearly establishes the formation of a binding agreement to settle the claims asserted in this lawsuit under Texas law.

A district court has inherent power to recognize, encourage, and when necessary enforce settlement agreements reached by the parties.  That one party to a suit initially agrees to a settlement but later refuses to execute a formal agreement that recites the terms of the settlement does not preclude a district court from exercising such discretion to enforce a settlement agreement.  Further, the issue of whether such withdrawal by one party is allowed under Texas law is irrelevant to whether a settlement is enforceable.  Unless the party seeking to withdraw can demonstrate that the agreement is invalid under state law at the time it was made or differs materially from any judgment entered enforcing the agreement, a federal court may hold them to their word by incorporating the terms of their agreement into a final judgment.

Here is a 2022, opinion from the Northern District of Texas, Dallas Division.  It is styled, Pasha & Sina, Inc. V. The Travelers Home And Marine Insurance Company, And Doug Salsbury.

This is a commercial policy case.

Plaintiff purchased the policy from Travelers.  Plaintiff attempted to recover from Travelers for damage to the property for roof leaks.  A dispute arose and Plaintiff sued Travelers and Salsbury in State Court alleging causes of action for negligence, negligent misrepresentation, common-law fraud, fraud by nondisclosure, violation of the duty of good faith and fair dealing, and violation of Chapter 542 of the Texas Insurance Code.

Insurance lawyers in the Dallas and Fort Worth 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.