Articles Posted in Texas Supreme Court

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An Insured obtained an insurance policy to reimburse its expenses in regaining control of an oil well in the event the well blew out. The well subsequently blew out and caught fire. The Insured represented to the Insurer that it owed 100 percent working interest in the well, andthe Insurer paid claims accordingly. After the Insurer discovered that the Insured might have possessed less than 100 percent working interest in the well, the Insurer filed a lawsuit for a return of its payments under breach of contract and equity claims. The court of appeals entered summary judgment in favor of the Insurer on its equity claims, but a different court of appeals overturned the prior rulings, concluding that the Insurer had no equitable right to reimbursement. The Supreme Court agreed with the court of appeals that the Insurer could not proceed on its equity claims but for different reasons, holding that because the insurance contract addressed the Insured’s conduct, the Insurer could not rely on its equity claims. Remanded to the court of appeals to address the contract claims. View "Gotham Ins. Co. v. Warren E&P, Inc." on Justia Law

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Ewing Construction Company entered into a contract with a school district to serve as general contractor on a project. The school district later filed suit against Ewing for faulty construction. Ewing tendered defense of the underlying suit to Amerisure Insurance Company, Ewing's insurer under a commercial package policy that included commercial general liability coverage. Amerisure denied coverage, and Ewing filed suit in federal district court seeking a declaration that Amerisure breached its duty to defend and indemnify Ewing for damages awarded in the underlying suit. The district court granted summary judgment for Amerisure, concluding that the policy’s contractual liability exclusion applied to exclude coverage because Ewing assumed liability for its own construction work pursuant to the contract such that it would be liable for damages arising out of its defective work. On appeal, the court of appeals certified questions to the Texas Supreme Court, which answered that “a general contractor that enters into a contract in which it agrees to perform its construction work in a good and workmanlike manner, without more specific provisions enlarging this obligation, does not ‘assume liability’ for damages arising out of the contractor’s defective work so as to trigger the contractual liability exclusion.” View "Ewing Constr. Co., Inc. v. Amerisure Ins. Co." on Justia Law

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Claimant suffered a compensable injury to his right ankle in 1991 and developed reflex sympathetic dystrophy in the injured ankle. In 1997, the appeals panel determined Claimant was entitled to Lifetime Income Benefits (LIBs). The workers' compensation carrier for Claimant's employer (Insurer) did not seek judicial review of that decision. More than a decade later, Insurer sought a new contested case hearing on Claimant's continuing eligibility for LIBs. A hearing officer found that Insurer could re-open the previous LIB determination but that Claimant remained entitled to LIBs. The appeals panel affirmed. Both parties sought judicial review. The trial court granted Claimant's motion for summary judgment, concluding that the hearing officer lacked jurisdiction to re-open the previous LIB determination. The court of appeals affirmed. The Supreme Court affirmed, holding that the Legislature does not allow permanent benefit determinations like LIBs to be re-opened. View "Liberty Mut. Ins. Co. v. Adcock" on Justia Law

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Homes built with an exterior insulation and finish system (EIFS) suffer serious water damage that worsens over time. Homebuilder began a remediation program in which it offered to homeowners to remove exterior EIFS from the homes it had built and to replace it with conventional stucco. Almost all the homeowners accepted Homebuilder's offer of remediation. Homebuilder sought indemnification for the costs from its insurers (Insurers). Insurers denied coverage, preferring instead to wait until the homeowners sued. This litigation ensued. Now, only one insurer remained. The court of appeals reversed the trial court's judgment in favor of Homebuilder, finding (1) Homebuilder failed to establish its legal liability to the homeowners to trigger Insurer's coverage; and (2) Homebuilder failed to offer evidence of damages covered by the policy. The Supreme Court reversed, holding (1) Homebuilder's settlements with the homeowners established both Insurer's legal liability for the property damages and the basis for determining the amount of loss; and (2) Insurer's policy covered Homebuilder's entire remediation costs for damaged homes. View "Lennar Corp. v. Markel Am. Ins. Co." on Justia Law

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A staffing services company (Company) furnished workers for the City, including Respondent. During the course of his employment, Employee lost an arm working on a garbage truck driven by an employee of the City. Respondent sued the City and its employee (collectively, Petitioners). Petitioners filed a motion for summary judgment, asserting governmental immunity based in part on the exclusive remedy under the Texas Labor Code, which provides that recovery of workers' compensation benefits is the exclusive remedy of an employee covered by workers' compensation insurance. The trial court dismissed the case. The court of appeals reversed, holding that a fact question remained whether Respondent, who was paid by Company, was within the specific terms of the City's workers' compensation coverage. The Supreme Court reversed and dismissed the case, holding that, as a matter of law, the City provided Respondent's workers' compensation coverage, and therefore, Respondent's exclusive remedy was the compensation benefits to which he was entitled. View "City of Bellaire v. Johnson" on Justia Law

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Petitioner suffered an injury while in the course and scope of his employment. The employer's workers' compensation insurance carrier paid medical benefits but contested the extent of Petitioner's entitlement to impairment income benefits. The Department of Insurance's Workers' Compensation Division determined that Petitioner had an impairment rating of twenty percent. The trial court reversed the agency's decision, ruling that Petitioner had no valid impairment rating. The court of appeals affirmed. While Petitioner's appeal to the Supreme Court was pending, the Court held in American Zurich Insurance Co. v. Samudio that the absence of a valid impairment rating that had been submitted to the agency did not deprive a reviewing court of subject matter jurisdiction. In light of its decision in Samudio, the Court then reversed and remanded to the trial court with instructions that the court remand the case to the Division in light of its determination that Petitioner had no valid impairment rating. View "DeLeon v. Royal Indem. Co." on Justia Law

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Respondent injured his back while working, and his employer's workers' compensation insurer, Texas Mutual Insurance Company (TMIC), accepted the injury as compensable. Three years later when it was discovered that Respondent had herniated lumbar intervertebral discs, TMIC disputed whether they were causally related to the original injury. The Texas Department of Insurance Division of Workers' Compensation determined that the disc herniations were related to the original injury and ordered TMIC to pay medical benefits, which it did. Respondent later sued TMIC for damages caused by its delay in paying benefits. The trial court rendered judgment for Respondent, and the court of appeals affirmed. Based on the Court's recent decision in Texas Mutual Insurance Co. v. Ruttiger, the Supreme Court reversed and rendered judgment for TMIC. View "Tex. Mut. Ins. Co. v. Morris" on Justia Law

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At issue in this case was whether a non-hurricane windstorm case could be joined as a tag-along to a previously created pre-trial Hurricane Ike multidistrict litigation (MDL) court. A single pretrial judge remanded this case because it did not arise from a hurricane. The Supreme Court granted the motion for rehearing and vacated the single pretrial judge's order of remand, holding (1) the case was related to the MDL litigation because the issue of whether State Farm covered shingle damage arising from wind events during the period between 2008 and 2010 was common to all cases; and (2) transfer would promote efficiency and serve the convenience of parties and witnesses. View "In re State Farm Lloyds Hurricane Litig." on Justia Law

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An employee (Employee) of the Austin Independent School District (AISD), a self-insured governmental entity, was injured on the job. AISD acknowledged that Employee had been injured but disputed whether the compensable injury extended to two alleged conditions. A hearing officer sided with Employee on the contested issues, as did the administrative appeals panel. In the district court, Employee filed a counterclaim seeking attorney fees. AISD filed a nonsuit, leaving only the counterclaim for fees. After a jury trial, Employee won a judgment on the verdict that included pre-nonsuit and post-nonsuit attorney fees. The court of appeals found (1) the evidence was sufficient to support the pre-nonsuit fee award, but (2) the post-nonsuit fee award could not stand. AISD brought a petition for review in the Supreme Court, arguing for the first time that governmental immunity from suit barred the award of attorney fees. The Supreme Court reversed in part, holding (1) the defense of sovereign immunity may be raised for the first time on appeal; and (2) AISD was immune from Employee's claim for attorney fees. View "Manbeck v. Austin Indep. Sch. Dist." on Justia Law

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An injured employee (Employee) sought workers' compensation benefits for a work-related injury. A claims adjuster with Employer's workers' compensation insurer's (Insurer) third party administrator denied the claim. The Division of Workers' compensation determined that Employee was entitled to medical and temporary income benefits. Employee subsequently brought a bad faith action against Insurer, its third party administrator, and the claims adjuster (Defendants). During discovery, Employee sought communications made between Insurer's lawyer and Employer during the administrative proceedings. Defendants argued that the attorney-client privilege protected the communications. The trial court held that the privilege did not apply. The court of appeals subsequently denied mandamus relief. The Supreme Court affirmed, holding that the attorney-client privilege did not protect the communications between Insurer and its insured. View "In re XL Specialty Ins. Co." on Justia Law