Articles Posted in Hail Claims

Claims denial attorneys will on occasion find themselves in a position of needing to hire an expert to help with their case.  The case referenced in the Blog is a hail damage case but the discussion is a discussion on what courts look at when determining whether an experts testimony will be allowed.  The case is from Eastern District of Texas.  The style of the case is, Hilltop Church of The Nazarene v. Church Mutual Insurance Co.

This case has other issues it discusses but here is what it says about experts.

Plaintiff claims that a March 2019 hailstorm caused damage to its property.

Bad Faith insurance lawyers understand that when sending an insurance company a pre-suit demand for damages that sending an improper letter ends up like sending no letter at all under certain circumstances.  One of the issues related to pre-suit notice letters was the topic in a January 2023 opinion from the Northern District of Texas, Dallas Division.  The opinion is styled, J. David Koncak v. American Security Insurance Company.

Koncak suffered a hail damage claim in June 2019 and then again in October 2019.  The claims resulted in a dispute and Koncak hired an attorney.  The attorney sent a pre-suit demand letter as required by the Texas Insurance Code, Section 542A.003(b).  The letter demanded damages in the amount of $550,000 plus $5,000 in attorney fees.

Koncak eventually filed suit.  American Security filed motions contending the notice letter did not satisfy the requirements of 542A.003(b).

Many insurance claims are hard to justify a lawsuit unless the insured can make a claim for attorney fees.  Most insurance claims do allow for recovery of attorney fees.  The caveat is that the claim for attorney fees has to be presented properly.  This includes notice prior to a lawsuit being filed.

Here is another recent (January 2023) case discussing attorney fees.  The opinion is from the Northern District of Texas, Dallas Division.  It is styled, Ghulam Sarwar d/b/a AR2S MGMT Inc. and AR2S MGMT Inc. v. General Star Indemnity Company.

This is a lawsuit arising out of a hail damage claim.  General Star (Defendant) filed a motion to exclude Plaintiffs claim for attorney fees based on the assertion that the required pre-suit notice made via email was insufficient and untimely.  Plaintiff counters that notice was sufficient, if not timely, was not timely due to concerns that the statute of limitations was running.

Attorney fees.  Attorney fees.  Attorney fees.  It’s a big deal.  Questions about attorney fees are common in cases involving insurance claims.  The fairly new Texas Insurance Code, Section 542A deals with attorney fees in specific weather related events, such as hail storms.  A 2022 opinion from the Northern District of Texas, Dallas Division discusses this issue.  The opinion is styled, Fiberco, Inc. v. Acadia Insurance Company and Union Standard Lloyds d/b/a Union Standard Insurance Group.

The Defendants in this case filed a motion asking the Court to disallow attorney fees for Fiberco.  The Court denied the motion.

A hailstorm damaged Fiberco’s property in 2020.  Fiberco sued the Defendants.  Counsel for Fiberco sent a demand letter in October 2020 demanding $406,678.05 to settle its claim.  That letter also requested reasonable and necessary attorney’s fees but did not demand a specific amount.

A common question for insurance lawyers is whether or not a claimant can recover attorney fees if they file a lawsuit.  This issue is discussed in a 2022 opinion from the Northern District of Texas, Dallas Division.  The opinion is styled, Antonio Mantzuranis v. State Farm Lloyds.

This is a case by Mantzuranis against State Farm for damages resulting from a storm.  State Farm paid the amount they believed owed on the claim but a trial resulted over the unpaid amount.  A jury awarded $84,020.03, less $39,020.03 for “Money Already Paid,” leaving a net of $45,000.  The Court ordered the parties to submit information regarding attorney fees.  Mantzuranis concedes that his attorney’s fees claim is subject to reduction under Insurance Code, Section 542A.

Texas Insurance Code, Section 542A.003(b)(2) applies to actions against insurers, including breach of contract claims, and requires a potential plaintiff to provide to a potential defendant pre-suit notice of “the specific amount alleged to be owed by the insurer on the claim for damage to or loss of covered property.”

As all insurance lawyers know, the Texas Insurance Code requires that prior to filing a lawsuit against an insurance company, that the insured give the insurance company a pre-suit notice.  This issue is discussed in a 2022 opinion from the Northern District of Texas, Dallas Division.  The opinion is styled, Nisha Hospitality LLC d/b/a Shady Oaks Motel v. Scottsdale Insurance Company.
A storm damaged Shady Oaks in October 2019.  Scottsdale estimated the damage at $19,461.40 in terms of replacement cost value.  On November 30, 2020, the public adjuster Shady Oaks hired (Pinnacle) sent Scottsdale its estimate of $87,270.91.  Pinnacle sent this estimate twice more on subsequent dates.  Counsel for Shady Oaks again sent the same demand for $87,270.91 on June 9, 2022, less than 61 days before filing suit.
Texas Insurance Code section 542A.003 requires that “not later than the 61st day before the date a claimant files an action . . . the claimant must give written notice to the person in accordance with this section as a prerequisite to filing the action.”

It is important in an insurance lawsuit whether or not the insurance company is subject to being sued for bad faith claims handling or whether or not there is a bona fide dispute about coverage.  A bona fide dispute rids the lawsuit of claims related to bad faith issued.

This was the issue in a 2022 opinion from the Western District of Texas, San Antonio Division.  The opinion is styled, David McArthur, Jean McArthur v. Safeco Insurance Company of Indiana.

This is a firstparty insurance dispute arising out of alleged damage to residential property as a result of a wind and hail storm.  Plaintiffs are the owners of an insurance policy (“the Policy”) issued by Defendant Safeco.

Hail damage claims are a frequent source of litigation.  The insured says the damage occurred in the last storm.  The insurance company says the damage is wear and tear or occurred in another storm under a different insurance policy.

The argument about when and how the hail damage occurred generally deals with the legal question known as “concurrent causation.”  This is discussed in a 2022, opinion from the Western District of Texas, Austin Division.  The opinion is styled, Marina Club Condominium Association vs. Philadelphia Indemnity Insurance Company.

This is a summary judgment opinion.  Plaintiff has sued for breach of contract and for insurance code violations.  The Court ruled in favor of Defendant on the insurance code violations but denied the summary judgement for the breach of contract claim.

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.

Here is a 2022, opinion from the Northern District of Texas, Lubbock Division, that deals with recovery of attorney fees under Section 542A of the Texas Insurance Code.  The opinion is styled, Mario Rodriguez v. Safeco Insurance Company of Indiana.

This is a decision based on Safeco’s motion for summary judgment.

At issue is whether payment of an appraisal award, plus payment of estimated interest due under the Prompt Payment Act, entitle an insurer to summary judgment on an insured’s claim
under the Prompt Payment Act.  If so, then the insurer is absolved from paying attorney’s fees
that otherwise would be due under the Prompt Payment Act.  No issue of material fact is present to prevent the entry of summary judgment.  As the Parties have recognized, this is purely a matter of law.  After careful review of the arguments and authority cited by the Parties, the Court finds that Defendant’s position is meritorious.  Although the issue presents policy factors that weigh in favor of each possible outcome, the Court finds that pursuant to 542A.007(a), the legislature’s intent appears clear when enacting Chapter 542A of the Texas Insurance Code to limit attorney’s fees.  It must be presumed that the legislature was aware of the conflict Chapter 542A would have with the Prompt Payment Act and chose to limit attorney’s fees anyway.  It is logical that attorney’s fees are not recoverable when the computation of fees as set forth in Chapter 542A.007(a) lead to zero because the apparent purpose is to curb abusive hailstorm claims.

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