Dallas Fort Worth Insurance Lawyer Blog

Improperly Suing The Adjuster

February 27, 2023 | Mark S. Humphreys

Here is a 2023 opinion that finds the suing of the insurance adjuster was improper. The opinion is styled, Hang Nguyen, et al v. AmGuard Insurance Company, et al. The opinion is from the Eastern District of Texas, Sherman Division.

Plaintiffs own a homeowners insurance policy with AmGuard. After a hail and windstorm that caused damage to their property, the Plaintiffs submitted a claim under the policy for repairs. The adjuster assigned to the case is Shawn Mitchell. Coverage was eventually denied.

The Plaintiffs eventually sued AmGuard for breach of contract and both faith causes of action and various violations of the Texas Insurance Code. They sued Mitchell for civil conspiracy and various violations of the Insurance Code. After the action was filed, AmGuard filed an Election of Legal Responsibility, accepting any liability on behalf of Mitchell.

Pre-Suit Notice Of Damages

February 25, 2023 | Mark S. Humphreys

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).

Pre-Suit Notice And Attorney Fees – 4

February 20, 2023 | Mark S. Humphreys

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.

Pre-Suit Notice And Attorney Fees – 3

February 18, 2023 | Mark S. Humphreys

Bad faith insurance lawyers will always sue for recovery of attorney fee when forced to file a lawsuit. Here is a 2022, opinion dealing with attorney fees under Texas Insurance Code, Section 542A. The opinion is from the Western District of Texas, Waco Division, and is styled, Waco Hippodrome Inc. v. Central Mutual Insurance Company D/B/A Central Insurance et al.

Hippodrome filed a lawsuit against it’s insurer, Central and others alleging violation of the Texas Insurance Code and breach of contract. As part of the lawsuit, Hippodrome also sought attorney fees. Central filed a motion seeking that Hippodrome’s request for attorney fees be dismissed based on the assertion there was non compliance by Hippodrome with Section 542A.003(b)(2).

In order to prevail in its Attorney’s Fee Motion, Central has the burden to “prove that Central was entitled to but was not given a presuit notice stating the specific amount alleged to be owed by the insurer under Section 542A.003(b)(2) at least 61 days before the date the action was filed by the claimant Hippodrome.”

Pre-Suit Notice And Attorney Fees – 2

February 13, 2023 | Mark S. Humphreys

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.

Pre-Suit Notice And Attorney Fees – 1

February 11, 2023 | Mark S. Humphreys

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.”

Pre-Suit Notice And Attorney Fees

February 6, 2023 | Mark S. Humphreys

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.”

What Gets You To Bad Faith

February 4, 2023 | Mark S. Humphreys

Insurance lawyers have a tendency to talk a lot about “bad faith” in the context of insurance disputes. However, the Courts have a strong tendency to rule that most cases are simply a breach of the insurance contract and do not amount to “bad faith” and violations of the Texas Insurance Code. A 2022 opinion discussing this was issued by the Western District of Texas, San Antonio Division. The opinion is styled, Ted Switzer v. State Farm Lloyds.

Switzer held a property insurance contract with State Farm covering his residential property. This case arises from Switzer’s claim for coverage benefits due to damage to his property caused by a hailstorm on May 27, 2020. Based upon allegations that State Farm improperly failed to satisfy its insurance coverage liability, Switzer asserted causes of action for breach of the insurance contract, violation of the Texas Insurance Code , Section 541 for unfair settlement practices, violation of the Prompt Payment Act in Texas Insurance Code, Section 542, violation of the Texas Deceptive Trade Practices Act, (DTPA) breach of duty of good faith and fair dealing, and common law fraud.

State Farm filed this Motion for Partial Summary Judgment on the causes of action of violation of the Texas Insurance Code, Section 541 for unfair settlement practices, violation of the DTPA, breach of duty of good faith and fair dealing, and common law fraud. State Farm also seeks summary–judgment dismissal of Switzer’s claim for exemplary damages based upon these causes of action. In his response, Switzer concedes summary judgment is appropriate on the causes of action of fraud and violation of the DTPA. Consequently, summary judgment on these two causes of action will be granted.

Insurable Interests?

January 30, 2023 | Mark S. Humphreys

Life insurance lawyers know that a beneficiary of a life insurance policy must have an “insurable interest” in the life of the insured.

Those who have an insurable interest in the life of another fall into three general classes:

(1) one so closely related by blood or affinity that he or she wants the other to continue to live, irrespective of monetary considerations;

Who Can Recover Life Insurance Benefits “Slayer’s Rule”

January 28, 2023 | Mark S. Humphreys

What if the person who is the named beneficiary of a life insurance policy, intentionally caused the death of the insured? Who gets the money?

Pursuant to the 1987, Texas Supreme Court opinion, Crawford v. Coleman, a beneficiary who willfully participates in bringing about the insured’s death, either as a principal or as an accomplice, forfeits any right to benefits. The benefits are payable to any innocent contingent beneficiary or to the insured’s nearest relative.

Sandra Shoaf was stabbed to death by her husband, Cornelius Shoaf. Sandra’s life was insured under four insurance policies, each designating Cornelius as the primary beneficiary. The trial court disqualified Cornelius from receiving Sandra’s death benefits because the jury found that Cornelius willfully caused Sandra’s death.