Affirmed and Memorandum Opinion filed January =
15,=20
2008.
In The
Fourteenth Court=20
of Appeals
____________
NO. 14-07-00238-CV
____________
BARI=20
WALKER, =
Appellant
V.
TRAVELERS=20
INDEMNITY COMPANY A/K/A TRAVELERS INSURANCE =
, =
Appellee
On Appeal from the =
113th District Court
Harris County, =
Texas
Trial Court Cause =
No. 2004-42324B
M E M O R=20
A N D U M O P I N I O N
This appeal involves =
an=20
automobile insurance coverage case. Appellant, Bari Walker, =
appeals=20
an order denying her motion for summary judgment and granting =
summary=20
judgment in favor of appellee, Travelers Indemnity Company A/K/A =
Travelers=20
Insurance. Appellant has also filed a motion for sanctions =
and to=20
strike appellee=3Ds responsive brief =
for alleged=20
misrepresentations stated in its brief, which has been ordered =
taken with=20
this appeal. We deny the motion for sanctions and=20
affirm.
BACKGROUND
On April 13, 2002, =
appellant=20
purchased a new 2003 automobile for $39,664.20. From the =
date of its=20
purchase, the automobile was insured by appellee under a standard =
Texas=20
personal automobile insurance policy (Athe =
Policy@). On August 3, =
2002,=20
less than four months after the purchase, a tree fell on the =
automobile=20
during a rainstorm. The automobile sustained interior and =
exterior=20
damage and was towed to Independent Body Paint Shop (AIndependent =
Body@). While =
appellant filed=20
a claim with appellee and demanded that the automobile be totaled, =
appellee determined that the automobile could be restored and =
elected to=20
repair it. Appellee initially estimated the repairs at =
$8,407.50 and=20
later supplemented the estimate with an additional =
$8,494.58. Thus,=20
appellee=3Ds total damage =
estimate was=20
$16,902.08, which appellee paid to appellant. Although =
Independent=20
Body performed certain repairs on the automobile, it was not =
restored to=20
its pre-accident condition, and appellant requested additional =
policy=20
benefits. When appellee refused, appellant sued appellee for =
breach=20
of contract and extra-contractual claims. =20
Appellant took the =
automobile=20
to a second body shop, Guidry=3Ds Body Shop, to be=20
inspected. Appellant then invoked her right to appraisal =
pursuant to=20
the terms of the Policy to resolve the dispute over the amount of =
the=20
loss. The appraisal provision in the Policy states: =
If we and you do not agree on the amount =
of loss,=20
either may demand an appraisal of the loss. In this event, =
each=20
party will select a competent appraiser. The two appraisers =
will=20
select an umpire. The appraisers will state separately the =
actual=20
cash value and the amount of loss. If they fail to agree, =
they will=20
submit their differences to the umpire. A decision agreed to =
by any=20
two will be binding . . .=20
=
. =
&=
nbsp; &n=
bsp; &nb=
sp; &nbs=
p; =
; =20
We do not waive any of our rights under =
this=20
policy by agreeing to an appraisal. =20
=
&=
nbsp; =20
Appellant chose James =
Walden as=20
her appraiser, and appellee chose Joe Conwill as its =
appraiser. =20
Walden and Conwill chose J.A. ADoc@ Watson as the =
umpire. =20
Watson determined that the cost to repair the automobile was=20
$25,177.52. Appellee disagreed with the $25,177.52 figure =
because it=20
believed that Watson had awarded additional money that he was not=20
authorized to award. Specifically, appellee contended that =
Watson=20
arrived at the $25,177.52 figure by adding the cost of repairing =
the=20
vehicle, $16,902.08, to the cost of Are-repairing@ the automobile,=20
$8,275.44. The latter sum represented the amount necessary =
to=20
correct substandard work performed by Independent Body. =
Appellee=20
filed a motion to strike the umpire award on the basis that Watson =
had=20
awarded an additional $8,275.44 for re-repairs unrelated to the =
tree=20
incident. The trial court denied appellee=3Ds motion. =
Thereafter, both =
parties moved=20
for summary judgment. Appellant argued in her motion that =
appellee=20
breached the Policy by failing to pay additional benefits in =
accordance=20
with the umpire award. Appellee argued that the Policy did =
not cover=20
the additional $8,275.44 for the re-repairs; therefore, it was =
only liable=20
for $16,904.08, which had been paid to appellant. The trial =
court=20
denied appellant=3Ds motion for summary =
judgment=20
and granted appellee=3Ds motion. On =
appeal=20
appellant argues that (1) there is insufficient evidence =
supporting the=20
trial court=3Ds decision to set =
aside the=20
umpire award, and (2) summary judgment in favor of appellee was =
improper=20
because it failed to show that it had performed its obligation =
under the=20
Policy.
STANDARD=20
OF REVIEW
Summary judgment =
under rule=20
166a(c) is proper only when a movant establishes that there is no =
genuine=20
issue of material fact and that the movant is entitled to judgment =
as a=20
matter of law. Tex. R. Civ. P. 166a(c);=20
Randall=3Ds Food Mkts., Inc. v. =
Johnson, 891=20
S.W.2d 640, 644 (Tex. 1995). We review a summary judgment =
de=20
novo. Valence Operating Co. v. Dorsett, 164 =
S.W.3d 656,=20
661 (Tex. 2005). A defendant is entitled to summary judgment =
if the=20
evidence disproves as a matter of law at least one element of each =
of the=20
plaintiff=3Ds causes of action or =
if the=20
evidence conclusively establishes all elements of an affirmative=20
defense. See Randall=3Ds, 891 S.W.2d at =
644. =20
Where the trial court grants the judgment without specifying the =
grounds,=20
we affirm the summary judgment if any of the grounds presented are =
meritorious. FM Props. Operating Co. v. City of =
Austin, 22=20
S.W.3d 868, 872-73 (Tex. 2000).
When both parties, as =
here,=20
move for summary judgment on the same issues and the trial court =
grants=20
one motion and denies the other, the reviewing court considers the =
summary=20
judgment evidence presented by both sides, determines all =
questions=20
presented, and renders the judgment the trial court should have=20
rendered. Dorsett, 164 S.W.3d at 661; FM =
Props., 22=20
S.W.3d at 872. In reviewing a summary judgment, we =
must=20
indulge every reasonable inference in favor of the nonmovant and =
resolve=20
any doubts in its favor. Randall=3Ds, 891 S.W.2d at 644; =
Lawson=20
v. B Four Corp., 888 S.W.2d 31, 33 (Tex. App.CHouston [1st Dist.] =
1994, writ=20
denied).
ANALYSIS
Setting Aside the =
Umpire=20
Award
In =
appellant=3Ds first issue, she =
argues that=20
the evidence is insufficient to support the trial =
court=3Ds decision to set =
aside the=20
umpire award. Appraisal awards made under the provisions of =
an=20
insurance contract are binding and enforceable, and a court will =
indulge=20
every reasonable presumption to sustain an appraisal award. =20
Franco v. Slavonic Mut. Fire Ins. Ass=3Dn., 154 S.W.3d 777, =
786 (Tex.=20
App.CHouston [14th Dist.] =
2004, no=20
pet.). The effect of an appraisal provision is to estop one =
party=20
from contesting the issue of damages in a suit on the insurance =
contract,=20
leaving only the question of liability for the court. =20
Id. Because a court indulges every reasonable =
presumption to=20
sustain an appraisal award, the burden of proof is on the party =
seeking to=20
avoid the award. Id. There are, however, three=20
situations in which the results of an otherwise binding appraisal =
may be=20
disregarded: (1) when the award was made without authority; (2) =
when the=20
award was made as a result of fraud, accident, or mistake; or (3) =
when the=20
award was not in compliance with the requirements of the =
policy. =20
Id.
Appellees=3Ds motion for summary =
judgment=20
was premised on the argument that the actual cost to repair the =
automobile=20
was $16,902.08, and that the additional $8,275.44 awarded by the =
umpire=20
for Are-repairs@ was not covered =
under the=20
Policy. According to appellant, however, the $24,275.44 =
figure=20
relates back to when the tree fell on the automobile and that the=20
re-repairs were not considered in calculating the $24,275.44 =
figure. =20
To support this argument, appellant relies on Watson=3Ds affidavit in which =
he states=20
that he arrived at the total amount from damages incurred =
Aat the time the loss =
was=20
sustained.@ According to =
appellant,=20
Aat the time the loss =
was=20
sustained@ refers to the fallen =
tree=20
incident and not the time period after the repairs were performed =
by=20
Independent Body.
While the issue =
raised by=20
appellant is whether the trial court erroneously set aside the =
umpire=20
award, the record reflects that the trial court did not strike the =
umpire=20
award. Rather, it sustained the award, comprised of current =
damages=20
and the amount needed to make necessary repairs to the =
automobile. =20
Subsequently, the trial court adopted appellee=3Ds coverage =
argument that=20
it had fully performed under the Policy by paying =
$16,902.08. The=20
trial court determined this amount to be the extent of=20
appellee=3Ds liability under the =
Policy.
This dispute involves =
the=20
extent of an umpire=3Ds authority. =
There is a=20
distinction between loss and coverage. Appraisers have no =
power or=20
authority to determine questions of coverage or liability. =
See=20
Wells v. American States Preferred Ins. Co., 919 S.W.2d 679, =
684-85=20
(Tex. App.CDallas 1996, writ =
denied)=20
(holding that an appraiser=3Ds power is limited to =
the=20
function of determining the money value of the property damage =
and,=20
therefore, has no authority to determine questions of coverage or=20
liability). Watson=3Ds umpire award =
determines loss=20
and damages, the Policy determines coverage and liability. =20
See id. Because the trial court sustained the umpire =
award and=20
appellee moved for summary judgment on the basis of coverage, the =
trial=20
court did not set aside the umpire award. We overrule=20
appellant=3Ds first=20
issue. =
Coverage and Full =
Performance=20
Under the Policy
In =
appellant=3Ds second issue, she =
argues that=20
summary judgment was improper because appellee failed to show =
performance=20
of its obligation under the Policy. According to appellant,=20
appellee=3Ds argument that the =
re-repairs=20
were solely and exclusively the result of Independent =
Body=3Ds work is a =
misrepresentation=20
of fact. Appellant contends that there were additional =
necessary=20
repairs not included in the $16,902.08 figure. Therefore, =
according to=20
appellant, appellee failed to pay for the total loss covered by =
the=20
Policy.
=20
Coverage =
under an=20
insurance policy is a question of law reviewed de =
novo. =20
See Utica Nat=3Dl Ins. Co. v. Am. =
Indem.=20
Co., =
141=20
S.W.3d 198, 202 (Tex. 2002). The general rules of contract=20
construction govern insurance policy interpretation. =
State Farm=20
Life Ins. Co. v. Beaston, 907 S.W.2d 430, 433 (Tex. =
1995). Here,=20
the relevant portions of the Policy state:
We will pay for direct and accidental =
loss to your=20
covered auto . . . .
. . . .
Our limit of =
liability for loss=20
will be the lesser of the:
1. =20
Actual cash value of the stolen or damaged property;
2. =20
Amount necessary to repair or replace the property with other of =
like kind=20
and quality . . . .
The coverage provided =
by the=20
Policy includes loss from a collision or a direct accident, with =
the=20
exception of specific exclusions not relevant to =
appellant=3Ds loss. The =
Policy=20
specifically defines collision as Athe upset, or =
collision with=20
another object.@ The necessity =
of=20
re-repairs due to shoddy work does not constitute a collision as =
defined=20
under the Policy. Furthermore, the defective work performed =
by=20
Independent Body is not a direct accident under the Policy. =
Though=20
appellant contends that there were additional repairs needed not =
included=20
in Wilson=3Ds initial estimate of =
$16,902.08, there is competent summary judgment evidence to the=20
contrary.
Watson indicates in =
his=20
official umpire report:
The very complete review by =
Guidry=3Ds of the after-repair condition of this =
vehicle=20
lists a plethora of defects needing re-repair. The estimate =
of=20
re-repairs needed of $8,274.44 is accepted . . . Using Mr.=20
Wilson=3Ds total estimate of $16,902.08 plus the =
re-repair=20
estimate of Guidry=3Ds of $8,275.44 together determine a =
total loss of=20
$25,177.52 . . . .
The umpire report =
reveals that=20
Watson itemized his total award of $25,177.52 in two parts: (1) =
$8,274.44=20
for Adefects needing=20
re-repair@ due to the =
Aafter repair =
condition of this=20
vehicle@ and (2) $16,902.08 =
for Mr.=20
Wilson=3Ds initial estimate =
for the=20
damage caused by the fallen tree. The Policy does not cover =
the=20
additional award of $8,274.44.
Appellant also relies =
on=20
Watson=3Ds affidavit which =
states that=20
he arrived at the total amount from damages incurred Aat the time the loss =
was=20
sustained.@ However, there is no =
evidence=20
establishing that the Aloss@ mentioned here by =
Watson=20
included only damages sustained at the time the tree fell on the=20
automobile and not at the time he inspected it, which was after=20
Independent Body performed the inadequate repairs. As a =
matter of=20
law, the Policy did not cover damages resulting from the =
substandard work=20
performed by Independent Body; only damages from the fallen tree =
were=20
covered by the Policy. There is summary judgment evidence=20
establishing that the extent of damages incurred by the fallen =
tree was=20
$16,902.08. It is undisputed that appellee paid this amount =
to=20
appellant. Accordingly, summary judgment was proper on the =
issue of=20
coverage and full performance by appellee under the Policy. We=20
overrule appellant=3Ds second=20
issue.
We also=20
deny=20
appellant=3Ds motion for =
sanctions, which=20
was taken with the case. Appellant moves for sanctions and =
to strike=20
appellee=3Ds responsive brief on =
the basis=20
that appellee (1) acted in bad faith when it advanced the argument =
that=20
the umpire award was bifurcated in two amountsB $16,902.06 and =
$8,274.44, (2)=20
gave false testimony when counsel read the umpire report as if it =
was the=20
umpire award, (3) misrepresented the dates between =
appellee=3Ds first estimate of =
$8,407.50=20
and supplemental estimate of $8,494.58, and (4) withheld =
information=20
regarding necessary and fundamental safety repairs needed, but not =
paid by=20
appellee. =20
Rule 52.11 of the Texas Rules of Appellate Procedure provides that =
we may=20
impose sanctions upon a party who grossly misstates or omits an =
obviously=20
important and material fact in the petition or response. =
See=20
Tex. R. App. P. 52.11. Appellee=3Ds argument=20
that the umpire award was comprised of $16,902.06 for damages =
related to=20
the fallen tree and $8,274.44 for re-repairs is supported by the =
evidence,=20
including the umpire report. Therefore, the argument does =
not=20
constitute a misrepresentation. Additionally, misstating the =
dates=20
of appellee=3Ds initial=20
and supplemental estimates does not constitute Agrossly=20
misstating obviously important and material facts@ =
under=20
rule 52.11. See id. The record does not =
reveal=20
that appellee misrepresented the umpire report as the umpire =
award. =20
Nor does it reflect that appellee withheld information regarding =
unpaid=20
repairs necessary to restore the automobile. We deny=20
appellant=3Ds motion=20
for sanctions and to strike appellee=3Ds=20
responsive brief.
We affirm the trial =
court=3Ds =
judgment.
/s/ =20
Adele Hedges
Chief =
Justice
Judgment=20
rendered and Memorandum Opinion filed January 15, 2008.
Panel=20
consists of Chief Justice Hedges, Justice Anderson, and Senior =
Chief=20
Justice Murphy.*
Do Not=20
Publish C =
Tex. R. App. P.=20
47.2(b).
*Senior=20
Chief Justice Paul C. Murphy sitting by =
assignment.
Although appellant later =
added=20
Independent Body as a defendant for breach of contract, breach of=20
warranty, fraud, and deceit for shoddy repairs, Independent Body =
is not a=20
party to the instant appeal. Appellant=3Ds claims against Independent Body were =
severed=20
from this case and are still pending in the trial=20
=
court. &=
nbsp; &n=
bsp; =20
Watson also indicated in a =
February 23,=20
2006 letter that he did not consider coverage when making =
the=20
appraisal award.
Appellant also contends that =
Texas law does=20
not exclude coverage for re-repairs where the repair election was=20
inappropriate, the insurer underpaid for the repair, or the =
insurer=20
otherwise contributed to the inadequacy of the repairs. =
However,=20
appellant cites no authority supporting this contention. =
See=20
Tex. R. App. P.=20
38.1(h). |