Insurance Attorney And Insurance Claims And Offsets

There are times for someone in Grand Prairie, Arlington, Fort Worth, Dallas, De Soto, Duncanville, Cedar Hill, Crowley, Mansfield, and other places in Texas to get with an Insurance Law Attorney to understand how certain aspects of insurance claims are to be handled.
In 1999, the Court of Appeals, Fourteenth District, Houston, had a case of “first impression,” meaning they were presented with an argument for the first time. The case dealt with an argument for offset and settlement credit against uninsured motorist coverage by a negligent third party. The dispute arose out of a multi-car accident.
The style of the case is, “Ann M. Bartley a/k/a Anne Marie Tadlock v. Martell Rae Guillot.” Here are some facts:
Guillot originally sued Ward, Bustos (uninsured), and Bartley (insured). Before trial, Guillot settled with Allstate, her uninsured motorist carrier, for $20,000 for the injuries she sustained in the accident caused by Bustos. The settlement agreement limited Allstate’s subrogation rights to any damages recovered from Bustos or any other uninsured motorist. Bustos was dismissed and Ward was nonsuited. Thus, Guillot proceeded against Bartley only and recovered $30,000. Bartley moved the court for a set-off in the amount of $20,000, the amount Guillot received from Allstate. This request was made pursuant to Texas Civil Practices & Remedy Code, Section 33.012. The trial court refused, and Bartley perfected this appeal.
The issue before the court was whether a negligent driver is entitled to receive credit from an independent insurance policy procured by the injured party. This is what made this a case of “first impression” in Texas. An insurance company who pays under contract for a loss or injury for the wrong of another is subrogated to the rights of the creditor or injured person against the wrongdoer. The insurer’s right to subrogation derives from the rights of the insured.
Here, Allstate paid Guillot, the insured, pursuant to Guillot’s uninsured motorist policy for the multi-car collision. This entitled Allstate to stand in the shoes of Guillot and assert any claims that Guilot was entitled to assert. However, Allstate decided not to exercise its subrogation rights. Thus, Allstate allowed Guillot to receive more money than the damages awarded by the jury because it did not attempt to collect from Bustos. (A total of $50,000).
In discussing this case, the court pointed out that what Bartley really seeks is reimbursement or contribution from Bustos via Allstate’s payment to Guillot under her uninsured motorist policy. However, Allstate stands in the shoes of Guillot not the shoe’s of the joint tortfeasor. Bustos, the uninsured alleged joint tortfeasor, was not a party to the suit. To prevent what has occurred, Bartley could have joined Bustos in a cross action as a third party defendant creating an opportunity for the jury to adjudicate Bustos’s liability, if any. This would have allowed Bartley to seek contribution or reimbursement from Bustos for any damages attributable to Bustos. To offset the $30,000 Bartley owed as damages by Allstate’s $20,000 settlement, would allow Bartley to receive contribution from the plaintiff and not a codefendant. Allstate’s liability arose from the fault, if any, of the uninsured motorist Bustos, not that of the insured driver, Bartley.
As stated, this was a case of first impression for the court and as such is not the type of situation that is going to happen very often.

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