IN THE SUPREME = COURT OF TEXAS

IN THE SUPREME COURT OF TEXAS

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No. 02-0730

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Excess=20 Underwriters at Lloyd=92s, London and Certain Companies = Subscribing=20 Severally But Not Jointly to Policy No. 548/TA4011F01,=20 Petitioners,

Frank=92s Casing = Crew &=20 Rental Tools, Inc., Respondent

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On Petition for Review from = the

Court of Appeals for the Fourteenth = District of=20 Texas

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Argued February=20 15, 2006

=20 Justice = O=92Neill=20 delivered the opinion of the Court, joined by Chief Justice Jefferson, Justice = Medina, Justice = Johnson, and Justice=20 Willett.

=20 Justice = Hecht=20 delivered a dissenting opinion, joined by=20 Justice Green.

=20 Justice = Wainwright=20 delivered a dissenting opinion.

=20 Justice = Brister did=20 not participate in the decision.

=20 On January 6, 2006, we granted respondent=92s motion for = rehearing. We now=20 withdraw our opinion issued May 27, 2005, and substitute the = following.

=20 In Texas, an insurer that settles a = claim against=20 its insured when coverage is disputed may seek reimbursement from the = insured=20 should coverage later be determined not to exist if the insurer = =93obtains the=20 insured=92s clear and unequivocal consent to the settlement and the = insurer=92s=20 right to seek reimbursement.=94 Tex. Ass=92n of=20 Counties County Gov=92t Risk Mgmt. Pool v. = Matagorda=20 County, 52 S.W.3d 128, 135 (Tex. 2000). In this case, which involves = excess=20 coverage, the insured consented to the settlement but not to the excess=20 insurer=92s asserted reimbursement right. We must decide whether to = recognize an=20 exception to the rule in Matagorda County and imply a = reimbursement=20 obligation when the policy involves excess coverage, the insurer has no = duty to=20 defend under the policy, and the insured acknowledges that the = claimant=92s=20 settlement offer is reasonable and demands that the insurer accept it. = Because=20 none of these distinctions alleviates the concerns that drove the = Court=92s=20 analysis in Matagorda County, we decline to recognize such an = exception.=20 We further hold that the excess insurers failed to establish that = Louisiana law regarding an insurer=92s right to=20 reimbursement differs from Texas law. Accordingly, we affirm = the court of=20 appeals=92 judgment.

I. Background

=20 Frank=92s Casing Crew & Rental Tool, Inc. fabricated a = drilling=20 platform for ARCO/Vastar. When the platform = collapsed,=20 ARCO sued Frank=92s Casing and several others. Frank=92s Casing had a $1 = million=20 primary liability policy, and excess coverage up to $10 million with = Excess=20 Underwriters at Lloyd=92s, London, and Certain Companies = Subscribing=20 Severally But Not Jointly To Policy No. = 548/TA4011F01=20 (collectively =93excess underwriters=94). The excess policy did not = require the=20 underwriters to assume control of the defense or the settlement of any = claims,=20 but did give them the right to associate with defense counsel retained = by=20 Frank=92s Casing or the primary insurer if it was reasonably likely that = the=20 excess coverage layer would be reached. After Frank=92s Casing notified = the excess=20 underwriters of ARCO=92s claims, the = underwriters issued=20 reservation-of-rights letters asserting that coverage for ARCO=92s claims was =93limited or negated=94 under = the policy=92s=20 terms.

=20 The primary carrier retained defense counsel for Frank=92s = Casing. As trial=20 approached, ARCO offered to settle its claims against Frank=92s Casing = for $9.9=20 million, an amount within the excess policy limits. Frank=92s Casing = rejected the=20 offer without passing it on to the excess underwriters. Two weeks before = trial,=20 the excess underwriters contacted ARCO directly, without Frank=92s = Casing=92s=20 knowledge, and attempted to settle claims the underwriters were willing = to=20 concede were covered. No agreement was reached. ARCO later made an $8.8 = million=20 global settlement offer to all of the defendants, about $7.55 million of = which=20 was allocated to Frank=92s Casing. The excess underwriters offered to = pay=20 two-thirds of this amount if Frank=92s Casing and its primary carrier = would pay=20 the balance, and further agreed to waive all coverage defenses if = Frank=92s Casing=20 accepted that proposal. Alternatively, the excess underwriters offered = to pay $5=20 million and defer all coverage issues to be resolved in arbitration. = Frank=92s=20 Casing rejected both proposals, insisting that it was covered under the = excess=20 policy and therefore the underwriters were obligated to fund the entire=20 settlement.

=20 Shortly before trial, the excess underwriters retained counsel to = associate with Frank=92s Casing and its primary carrier in defending = against ARCO=92s claims. As trial began, it quickly became = clear that=20 Frank=92s Casing was ARCO=92s primary = target, prompting=20 Frank=92s Casing=92s in-house counsel to contact ARCO and solicit a = settlement=20 demand within the excess coverage limits. Frank=92s Casing=92s counsel = suggested=20 that something in the $7 million range would be reasonable. ARCO = responded with=20 a $7.5 million demand. Frank=92s Casing forwarded ARCO=92s=20 demand to the excess underwriters with a letter suggesting that the = settlement=20 offer was a reasonable one that the underwriters should accept. The = letter=20 reiterated Frank=92s Casing=92s disagreement with the underwriters=92 = coverage=20 position, and stated that Frank=92s Casing was looking to the = underwriters to fund=20 the settlement. In their response two days later, the underwriters = agreed that=20 the case should be settled, but noted that coverage issues remained. The = underwriters offered to fund the entire settlement if Frank=92s Casing = would agree=20 to reserve those issues for resolution later. Frank=92s Casing rejected = the=20 underwriters=92 proposal, contending that the excess insurance policies = obligated=20 the underwriters to fund the settlement. In response, the excess = underwriters=20 advised Frank=92s Casing that they would pay $7.5 million to settle the = claim,=20 less any contribution from the primary carrier, and then seek = reimbursement from=20 Frank=92s Casing. Within hours, the underwriters contacted ARCO and = orally=20 accepted its settlement offer, and the primary carrier tendered its = remaining=20 policy limits of approximately $500,000. A written settlement agreement = among=20 ARCO, Frank=92s Casing, and the excess underwriters preserved =93any = claims that=20 exist presently=94 between Frank=92s Casing and the underwriters. Before = that=20 agreement was executed, the excess underwriters filed this suit.

=20 Both Frank=92s Casing and the excess underwriters filed a series = of cross=20 motions for partial summary judgment. The trial court initially granted = the=20 underwriters=92 motions on their right to reimbursement. It also granted = their=20 motions for partial summary judgment on coverage, and another concluding = that=20 the excess underwriters were entitled to $7,013,612 in damages on their=20 reimbursement claim. Before a final judgment was entered, this Court = issued=20 Texas Association of Counties County Government Risk Management Pool = v.=20 Matagorda County, declining to recognize an implied-in-fact, an=20 implied-in-law, or an equitable reimbursement right outside of the = insurance=20 policy=92s provisions. 52 S.W.3d at 128. In = light of our=20 decision, the trial court ordered Frank=92s Casing to file a motion for = new trial=20 only on the reimbursement issue. Frank=92s Casing filed the motion and = the trial=20 court granted it, withdrew its prior order, and signed a take-nothing = judgment=20 in Frank=92s Casing=92s favor. The court of appeals affirmed. 93=20 S.W.3d 178. We granted the excess underwriters=92 petition for = review to=20 decide whether our decision in Matagorda County allows the = underwriters=20 to assert a reimbursement right under the circumstances presented.

II. Reimbursement Under = Texas = Law

=20 In Matagorda County, we examined an = insurer=92s=20 asserted reimbursement right in similar, though not identical, = circumstances.=20 52 S.W.3d at 129. There, the Texas = Association of=20 Counties (TAC) provided law-enforcement liability coverage to Matagorda = County, but the policy excluded = coverage=20 for claims =93arising out of jail.=94 When three inmates who had been = assaulted by=20 other prisoners in the County=92s jail sued the County, TAC initially = denied=20 coverage based on the jail exclusion. After some negotiation, TAC agreed = to pay=20 defense costs, subject to a reservation of rights to preserve its = coverage=20 contest, and filed suit against the County seeking a declaratory = judgment that=20 the inmates=92 claims were not covered. Ultimately, the plaintiffs in = the=20 underlying suit offered to settle for $300,000, an amount within TAC=92s policy limits. Although the County did not = dispute the=20 reasonableness of the proposed settlement, the County refused to fund or = contribute to it, insisting that the claims were = covered. At=20 this point, TAC issued a second reservation-of-rights letter, again = reserving=20 its right to continue to deny coverage, but adding a statement that it = was not=20 waiving =93any of its rights to pursue full recovery of this settlement = amount=20 from the County . . . in the declaratory judgment action.=94 Id. at=20 130. TAC settled the case, then = amended its=20 pending declaratory judgment action to seek reimbursement.

=20 We held that, under the circumstances presented, TAC had not = established=20 a right to reimbursement. Id. at=20 133. First, we held that TAC could only reserve rights that were=20 expressed in the policy, and TAC=92s policy = did not=20 contain a right of reimbursement. Id. at 131 (stating =93a unilateral reservation-of-rights = letter cannot=20 create rights not contained in the insurance policy=94). Second, = we held=20 that neither the County=92s silence in response to TAC=92s=20 reservation of rights, nor its failure to contest the settlement=92s=20 reasonableness, were sufficient to create an implied-in-fact = reimbursement=20 obligation that did not appear in the policy. Id. at 132=9633. Third, we held that TAC had not = established a=20 right to reimbursement under quasi-contractual theories of quantum = meruit or unjust enrichment. Id. at=20 134=9635. Finally, we held that an insurer could impose a = reimbursement=20 obligation on its insured by either drafting policies to specifically = include a=20 reimbursement right, or by obtaining the insured=92s =93clear and = unequivocal=20 consent to the settlement and the insurer=92s right to seek = reimbursement.=94=20 Id. at=20 135.

=20 Our analysis in Matagorda County highlighted the = dilemma faced=20 by both insurer and insured when a claimant presents a settlement demand = within=20 policy limits and coverage is uncertain. Id. (stating =93[w]e recognize that, however the issue is = resolved,=20 either insurers or insureds will face a = difficult=20 choice when coverage is questioned=94). On one hand, an insurer = that=20 rejects a reasonable offer within policy limits risks significant = potential=20 liability for bad-faith insurance practices if it does not ultimately = prevail in=20 its coverage contest. Id.; see G.A. Stowers Furniture Co. v. Am. Indem. Co., 15 S.W.2d = 544, 547=20 (Tex. Comm=92n App. 1929, holdings = approved).=20 Denying a reimbursement right in this situation in effect creates = coverage in=20 those cases where coverage is ultimately determined not to exist. At the = same=20 time, imposing an extra-contractual reimbursement obligation places the = insured=20 in a highly untenable position. See Matagorda County, 52 S.W.3d at=20 135. The insured is forced =93to choose between rejecting a = settlement=20 within policy limits or accepting a possible = financial=20 obligation to pay an amount that may be beyond its means, at a time when = the=20 insured is most vulnerable.=94 Id. at=20 134.

=20 We resolved this quandary in Matagorda County, determining that the = risk of=20 coverage uncertainties was best placed with the insurer. Id. We = reasoned=20 that =93[r]equiring the insurer, rather than = the=20 insured, to choose a course of action is appropriate because the insurer = is in=20 the business of analyzing and allocating risk and is in the best = position to=20 assess the viability of its coverage dispute.=94 Id. at 135. An insurer in this situation has a number = of=20 options. If the insurer assesses its coverage position as strong, it may = refuse=20 to participate in settlement and rely on its coverage action, leaving = the=20 insured to negotiate a settlement with its own resources. Or, an insurer = may=20 seek prompt resolution of its coverage dispute, a course we have = encouraged=20 insurers in this position to take. Id. at 135 (citing State = Farm Fire=20 & Cas. Co. v. Gandy, 925 = S.W.2d 696, 714=20 (Tex. 1996); Farmers = Tex. County Mut. Ins. Co. v. = Griffin, 955 = S.W.2d 81, 84=20 (Tex.=20 1997)). Or, if an insurer=92s coverage position is = difficult to=20 assess, as is sometimes the case, the insurer can leverage the coverage = dispute=20 during settlement negotiations to lower the claimant=92s demand; by = paying the=20 negotiated claim, the insurer eliminates its own potential bad-faith = liability,=20 saves defense costs, and avoids protracted coverage litigation with its = insured.=20 Or, at the outset, the insurer may include a reimbursement right in the = policy,=20 which may yield a lower premium than a policy that does not contain such = a=20 right.

=20 By contrast, recognizing an extra-contractual reimbursement right = leaves=20 insureds with fewer options and creates a = number of=20 potential problems. As we noted in Matagorda County, allowing an = insurer=20 to settle claims and then sue its policyholder =93foster[s] conflict and = distrust=20 in the relationship between an insurer and its insured,=94 a situation = that has=20 been widely rejected in analogous contexts. Id. at 134; see also Medina v. Herrera, 927 S.W.2d 597, 604 = (Tex. 1996). = For example,=20 courts have long declined to allow insurers to seek equitable = subrogation=20 against their insureds. See Phonenix Ins. Co. v. Erie & W. Transp. = Co., 117=20 U.S. 312, 320=9625 = (1886).=20 Strong public policy reasons support that rule:

The=20 fiduciary relationship between insurer and insured is fraught with = conflicting=20 interests . . . . [B]ecause of the fiduciary = relationship, the insurer would be able to secure information from its = insured=20 under the guise of policy provisions available for later use in a = subrogation=20 action against the insured. [Further], the right to sue [its] own = insured could=20 be interpreted by an insurer as judicial sanction to breach the policy = of=20 insurance.

Stafford Metal Works, Inc. v. Cook Paint & Varnish = Co.,=20 418 F. Supp. 56, 58=9659 (N.D. Tex. 1976) (citations = omitted).

=20 Several amici further warn = that implying=20 a reimbursement right would create a significant conflict for defense = counsel=20 during settlement discussions.[1] According to the amici, if an insured=92s acknowledgment of = a settlement=20 offer=92s reasonableness were to expose the insured to an = extra-contractual=20 reimbursement obligation, as the underwriters here contend it should, = defense=20 counsel=92s traditional role in evaluating and recommending settlement = could end=20 up advancing the insurer=92s interest over that of the insured, = necessitating the=20 insured=92s retention of its own coverage counsel during what may be a = critical=20 point in the proceedings. Indeed, the amici=20 argue, with defense counsel thus hindered from encouraging = settlement, both=20 the insured and the insurer will likely feel the need to hire their own=20 =93settlement counsel=94 to evaluate the case and formulate a strategy = for the=20 anticipated reimbursement litigation. Whether or not the concerns the = amici voice are real or imagined, we = believe they do=20 portend significant distrust in the insurer/insured relationship during = the=20 settlement process should an equitable reimbursement right be = implied.

=20 Several amici also warn = that=20 recognizing a reimbursement right risks = weakening the=20 insurer=92s incentive to negotiate a settlement most favorable to its = insured.=20 Knowing that the insured will likely bear the ultimate payment = obligation could=20 incentivize the insurer to curtail attorney=92s fees and litigation = expenses early=20 in the proceedings by negotiating a quick settlement, with the added = benefit of=20 extinguishing any risk of Stowers=20 liability. See Stowers, 155 S.W.2d at 547. The potentially protracted=20 coverage/reimbursement litigation likely to follow would be at the = insured=92s=20 expense, even though the insured purchased insurance for the very = purpose of=20 hedging the risk and expense of future litigation.

=20 The Court in Matagorda County weighed the = varying=20 risks that arise in this context and decided that insurers, on balance, = are=20 better positioned to handle them =93either by drafting policies to = specifically=20 provide for reimbursement or by accounting for the possibility that they = may=20 occasionally pay uncovered claims in their rate structure.=94 Matagorda=20 County, = 52 S.W.3d at 136. We decline to overrule that = decision, and=20 now turn to the underwriters=92 argument that the circumstances = presented here are=20 distinguishable and support their asserted right to reimbursement in = this=20 case.

III. Excess Underwriters=92 Reimbursement = Theories

=20 The excess underwriters contend that by soliciting the settlement = demand=20 and agreeing to be bound by it, Frank=92s Casing impliedly consented to = reimburse=20 the excess underwriters. The underwriters further claim an equitable=20 reimbursement right under the doctrines of quantum meruit and assumpsit.=20 Although we declined to recognize an implied or equitable reimbursement = right in=20 Matagorda County, the underwriters contend our decision was = limited to=20 the facts presented in that case. They maintain that the rationale = underlying=20 our decision does not apply here because the excess underwriters had = neither the=20 duty to defend nor unilateral control over settlement, factors they = contend were=20 critical underpinnings of our Matagorda County analysis. The=20 underwriters also emphasize that, unlike the insurer in Matagorda=20 County, = their policy=20 prevented them from settling the case without Frank=92s Casing=92s = consent.

A. Implied-in-Fact Agreement

=20 The excess underwriters argue that Frank=92s Casing impliedly = agreed to=20 reimbursement by taking an active role in procuring the settlement = offer, and in=20 demanding that the excess underwriters settle the claim. They also point = to=20 Frank=92s Casing=92s participation in the drafting and negotiation of = the settlement=20 agreement.

=20 Undoubtedly, these actions demonstrate that Frank=92s Casing = believed the=20 claims should be settled, but they say nothing about Frank=92s = Casing=92s agreement=20 to a reimbursement obligation that does not appear in its policy. To the = contrary, Frank=92s Casing=92s letters to the excess underwriters = expressed=20 continuing disagreement with the insurers=92 coverage position, = indicated that=20 Frank=92s Casing was looking to the excess underwriters to fund the = entire=20 settlement, and made clear that Frank=92s Casing would seek recourse = against the=20 underwriters if the case was not settled and a judgment in excess of = policy=20 limits resulted. In settling the ARCO suit, both Frank=92s Casing and = the excess=20 carriers expressly sought to preserve their positions in the coverage = dispute;=20 in effect, they agreed to disagree on the reimbursement question and let = the=20 trial court decide the legal effect. This is a far cry from impliedly = consenting=20 to reimbursement. The excess underwriters benefitted from the settlement = by=20 eliminating potential Stowers = liability in the=20 event ARCO=92s claims were later determined = to be=20 covered, just as Frank=92s Casing benefitted by eliminating the = possibility of a=20 large verdict that might turn out not to be covered. Given the = parties=92 explicit=20 efforts to preserve their positions, it makes no more sense to say that = Frank=92s=20 Casing impliedly agreed to reimburse the carriers than it would to say = that the=20 carriers impliedly agreed to waive their coverage position. Just as an = insured=92s=20 acceptance of a defense the insurer proffers with a reservation of = rights=20 implies the insured=92s consent to the reservation, the excess = underwriters=92=20 agreement to accept the settlement in light of Frank=92s Casing=92s = reimbursement=20 contest implied the insurers=92 consent to Frank=92s Casing=92s = reservation of the=20 reimbursement question. As we reaffirmed in Matagorda County, =93a meeting of the = minds is an=20 essential element of an implied-in-fact contract.=94 Matagorda County, 52 S.W.3d at 133 (citing Haws = &=20 Garrett Gen. Contractors, Inc. v. Gorbett = Bros.=20 Welding Co., 480 S.W.2d 607, 609 (Tex. 1972)). Frank=92s Casing=92s = agreement to=20 reimburse the excess insurers cannot be implied in light of its = consistent=20 position that the insurers alone were responsible for the claims.

=20 The excess insurers contend, however, that Frank=92s Casing=92s = agreement may=20 be implied here because, unlike in Matagorda County, Frank=92s = Casing=92s=20 policy did not allow the insurers to settle without Frank=92s Casing=92s = consent. In=20 support, the underwriters cite the following policy language:

Liability=20 under this policy with respect to any occurrence shall not attach unless = and=20 until the Assured, or the Assured=92s = underlying=20 insurers, shall have paid the amount of the underlying limits on account = of such=20 occurrence. The Assured shall make a definite claim for any loss for = which=20 the Underwriters may be liable under this policy within twelve (12) = months after=20 the Assured shall have paid an amount of ultimate net loss[2] in excess of the amount = borne by the=20 Assured or after the Assured=92s liability = shall have=20 been fixed and rendered certain either by final judgment against the = Assured=20 after actual trial or by written agreement of the Assured, the claimant, = and=20 Underwriters. If any subsequent payments shall be made by the = Assured on=20 account of the same occurrence, additional claims shall be made = similarly from=20 time to time. Such losses shall be due and payable within thirty (30) = days after=20 they are respectively claimed and proven in conformity with this = policy.[3]

As = we read=20 this language, however, it describes when payment is due to the insured = under=20 the policy. Specifically, the insurer must pay Frank=92s Casing when the = primary=20 coverage layer is exhausted and Frank=92s Casing timely presents a claim = for any=20 excess amount for which it has been found liable as the result of a = trial or a=20 written agreement to which the parties acquiesced. In other words, the = policy=20 requires Frank=92s Casing to obtain the underwriters=92 consent to a = settlement to=20 receive payment under the policy. The policy language says nothing about = the=20 underwriters=92 reimbursement rights should they decide to negotiate a = settlement=20 of the claim.

B. Equitable Theories

=20 The excess underwriters also claim a reimbursement right under = the=20 equitable theories of quantum meruit = and assumpsit. Under the former theory, one who = provides=20 valuable services to another may establish that the service=92s = recipient has an=20 implied-in-law obligation to pay when the recipient has reasonable = notice that=20 the service provider expects to be paid. See = Heldenfels Bros., Inc. v. Corpus=20 Christi, 832 S.W.2d 39, 41 (Tex. 1992). Under the latter, = a cause=20 of action arises when money is paid for the use and benefit of another. = See King v. Tubb, 551 = S.W.2d 436,=20 442 (Tex. Civ. App.=97Corpus Christi 1977, no writ).

=20 We held in Matagorda County that TAC could not = recover on=20 either quantum meruit or an unjustment enrichment theory, a quasi-contractual = doctrine=20 that closely resembles assumpsit. The = excess=20 underwriters argue that Matagorda County does not govern because = Frank=92s=20 Casing sought a settlement demand from ARCO and demanded that the = underwriters=20 pay it. They also contend that their status as excess insurers with no = duty to=20 defend distinguishes this case from Matagorda County. Neither of = those=20 distinctions, however, allays the concerns underlying our analysis in = Matagorda=20 County.

=20 The parties=92 respective positions were no less firmly drawn in = Matagorda=20 County = than in this=20 case. There, it was clear that =93the County was looking to [TAC] to = settle . . .=20 without a contribution from [the County].=94 Matagorda,=20 52 S.W.3d at 133 (internal quotations omitted). We fail to see = how=20 Frank=92s Casing=92s suggestion that ARCO submit a settlement demand = within policy=20 limits meaningfully distinguishes the decision. In Matagorda = County, we=20 concluded that =93when coverage is disputed and the insurer is presented = with a=20 reasonable settlement demand within policy limits, the insurer may fund = the=20 settlement and seek reimbursement only if it obtains the insured=92s = clear and=20 unequivocal consent to the settlement and the insurer=92s right = to seek=20 reimbursement.=94 Id. at 135 (emphasis added). = We did so=20 because =93[o]therwise, the insured is = forced to choose=20 between rejecting a settlement within policy limits or=20 accepting a possible financial obligation to pay an amount that may be = beyond=20 its means, at a time when the insured is most vulnerable.=94 Id. = That fundamental concern is unaffected by the fact that = the excess=20 underwriters had no duty to defend.

=20 There is an additional reason that the excess underwriters are = not=20 entitled to a reimbursement right. That is, =93[w]hen a valid agreement = already=20 addresses the matter, recovery under an = equitable=20 theory is generally inconsistent with the express agreement.=94 Fortune Prod. Co. v. = Conoco,=20 Inc., 52 S.W.3d 671, 684 (Tex.=20 2000). Here, the insurance policies spell out the = parties=92=20 respective obligations in great detail. As set out above, the excess=20 underwriters were not liable under the policy until the primary coverage = was=20 exhausted, Frank=92s Casing had provided timely notice, and Frank=92s = Casing had=20 become liable for a judgment either as the result of a trial or a = settlement to=20 which the excess underwriters had agreed. To recognize an equitable = right to=20 reimbursement would require us to =93rewrite the parties=92 contract = [or] add to its=20 language,=94 Am. Mfrs. Mut. Ins.=20 Co. v. Schaefer, 124 S.W.3d 154, 162=20 (Tex. 2003),=20 which we decline to do.

C. Other States

=20 The excess underwriters also urge us to overrule Matagorda = County=20 and follow the decisions of the California Supreme Court in Blue = Ridge=20 Insurance Co. v. Jacobsen, 22 P.3d 313 (Cal. 2001), and a Florida = appellate=20 court in Colony Insurance Co. v. G & E Tires & Service, = Inc., 777=20 So. 2d 1034 (Fla. Dist. Ct. = App. 2000). In Blue=20 Ridge, the California Supreme Court implied a = reimbursement=20 obligation in favor of a liability insurer that funded a settlement of = claims=20 ultimately determined not to be covered. Blue=20 Ridge, 22 P.3d at 314. The = California court distinguished our decision in=20 Matagorda = County on the basis that California provides a much more limited = opportunity to=20 resolve coverage issues before the underlying lawsuit is resolved than = does=20 Texas.=20 Id. at=20 322=9623. Moreover, the legal background underlying Blue = Ridge=20 differs significantly from Texas law. An insurer in Texas cannot = be held=20 liable under Stowers for failing to = settle a=20 claim that is not covered. Am. Physicians Ins. = Exch. v.=20 Garcia, 876 S.W.2d 842, 849 (Tex. 1994). Under California = law, however,=20 an insurer may not consider whether claims are covered in evaluating = settlement=20 demands. Blue Ridge, 22 P.2d at 318.

=20 In Colony Insurance, the Florida appeals court held that a = liability=20 insurer=92s reservation of rights letter, coupled with the insured=92s = acceptance of=20 a defense, entitled the insurer to reimbursement for defense costs it = had paid.=20 777 So. 2d at 1039. We held in Matagorda=20 County, = however, that a=20 unilateral reservation-of-rights letter could not create a reimbursement = obligation not contained in the insurance contract. Matagorda=20 County, 52 S.W.3d at 131. As we have noted, to follow = Colony=20 Insurance would require us to overrule Matagorda County, which we = decline to=20 do.

IV. The Dissents

=20 Justice Hecht would impose an equitable reimbursement obligation = on=20 Frank=92s Casing that is not found in its policy, supplementing the = terms these=20 sophisticated parties negotiated based on an unjust-enrichment theory. = Justice=20 Wainwright, recognizing that the equities presented cut both ways, does = not=20 agree that a reimbursement right may be implied in law; instead, he = would apply=20 one in fact, as a matter of law, based on Frank=92s Casing=92s = acquiescence in the=20 settlement, even though both parties expressly reserved their respective = positions on the coverage/reimbursement question. On indistinguishable = facts, we=20 rejected both of those theories in Matagorda County. 52 S.W.3d at=20 131=9635. In =93rewrit[ing] the parties=92 contract . . . [because they] = believe we=20 should,=94 Utica Nat=92l Ins. Co. of Tex. v. Am. Indem.=20 Co., 141 S.W.3d 198, 208 (Tex. 2004) (Hecht, J., dissenting), and = eschewing=20 our own precedent, the dissenting justices would, in the words of one = amicus=20 curiae, =93take[] a step back from predictability in the law related = to=20 business transactions in Texas and, therefore, a step back from the = continuing=20 effort to attain a fair, efficient, and predictable civil justice = system,=94=20 Amicus Curiae Brief of Texas Civil Justice League in Support of = Respondent=92s=20 Motion for Rehearing, at 2.

=20 In Matagorda County, this Court drew a = bright-line=20 rule disallowing reimbursement on an equitable unjust-enrichment theory = because=20 insurers are in a superior position to evaluate the risks stemming from = a=20 coverage dispute and can expressly allocate that risk by delineating=20 reimbursement rights in their policies. 52 S.W.3d at = 135=9636. Justice Hecht=92s approach would undermine both the = predictability=20 that our decision in Matagorda County provided and the =93strong = public=20 policy in favor of preserving the freedom of contract.=94 Fortis = Benefits v.=20 Cantu, 234 S.W.3d 642, 649 (Tex. 2007). Just a few months ago, = we=20 concluded that an insured could not rely on the equitable = =93made-whole=94 doctrine=20 to supplant a contractual subrogation clause. Id. at 645. We warned that courts =93should not by = judicial fiat=20 insert non-existent language . . . into parties=92 agreed-to contracts . = . . .=94=20 Id.=20 at 649 n.41. The Court proclaimed itself = =93loathe to=20 judicially rewrite the parties=92 contract by engrafting = extra-contractual=20 standards,=94 id. at 649, and = reaffirmed the=20 reasoning that supported our holding in Matagorda County: =93insurers are well = equipped to=20 evaluate and reduce risk by, for example, =91drafting policies to = specifically=20 provide for reimbursement,=92=94 id. (quoting=20 Matagorda County, 52 S.W.3d at 136).

=20 Justice Hecht attempts to limit our decision in Matagorda=20 County = to its=20 facts, arguing the concerns that drove our decision there do not exist = in this=20 case and, even if they did, an equitable remedy could be fashioned to do = equity=20 in accordance with general restitution principles. While his dissent = asserts=20 that the remedy could be limited to avoid =93unfairness,=94 it offers = little=20 guidance as to the remedy=92s boundaries. He hints that the concerns = underlying=20 Matagorda County do not apply because Frank=92s Casing is =93a = substantial=20 business.=94 Under Justice Hecht=92s construct, then, whether an insured = faces a=20 reimbursement obligation would have to be decided on a case-by-case = basis: insureds with less economic heft than Frank=92s = Casing but=20 more than Matagorda County might or might not be on = the hook,=20 depending upon how a court might view the =93equities=94 presented. = Justice Hecht=92s=20 approach would breed uncertainty and =93promote litigation rather than = settle it.=94=20 Gandy, 925 S.W.2d at 709.

=20 Justice Wainwright=92s approach is similarly untenable. Agreeing = with the=20 Court that the circumstances would not support a reimbursement right = implied in=20 law, he would imply one in fact =97 as a matter of law. As in = Matagorda=20 County, however, the record here affirmatively demonstrates just the = opposite. Frank=92s Casing=92s repeated insistence on its coverage = position and on=20 the excess underwriters=92 obligation to fund any settlement, and its = express=20 reservation of the question, belie any meeting of the minds =97 =93an = essential=20 element of an implied-in-fact contract.=94 Matagorda County, 52 S.W.3d at=20 133. Just as in Matagorda County, Frank=92s Casing = =93consistently=20 contested [the excess underwriters=92] coverage position and insisted = that [they]=20 pay under the policy.=94 Id. Undoubtedly, the parties = agreed=20 that the case should be settled. But the excess underwriters=92 own = letter to=20 Frank=92s Casing advising that it would contact ARCO and attempt to = settle noted=20 that the underwriters had =93asked Frank=92s to contribute to the = settlement [and]=20 Frank=92s ha[d] refused.=94 Furthermore, though Justice Wainwright = contends that=20 Frank=92s Casing=92s agreement to the settlement constituted a = manifestation of=20 assent to the terms on which it was offered, there is uncontested = evidence that=20 the excess underwriters first mentioned reimbursement in a letter it = sent to=20 Frank=92s Casing just hours before they contacted the plaintiffs and = settled the=20 case. Frank=92s Casing=92s assent cannot be inferred under these = circumstances.=20 See Restatement = (Second) of=20 Contracts =A7 69(1)(a) (1981) (noting = that assent=20 may only be inferred =93[w]here an offeree = takes the=20 benefit of offered services with reasonable opportunity to reject = them=94). We=20 held on nearly identical facts in Matagorda County that =93there = was no=20 meeting of the minds=94 between the insurer and its insureds. Id. Given the parties=92 = explicit efforts=20 to preserve their respective positions on the coverage/reimbursement = question,=20 it makes no more sense to conclude that Frank=92s Casing impliedly = agreed to=20 reimburse the excess carriers than it would to say that the excess = carriers=20 impliedly agreed to waive their coverage position.

V. Choice of Law

=20 The excess underwriters argue alternatively that Louisiana law = recognizes=20 a reimbursement right, and that state=92s law should apply to this case = because=20 Frank=92s Casing=92s principal place of business is in Louisiana, the = policy was=20 issued through a Louisiana insurance agency, and the underlying incident = arose=20 from work Frank=92s Casing performed in Louisiana. Frank=92s Casing = contends that=20 the excess underwriters never requested that the trial court apply = Louisiana law to the reimbursement issue, and = also never=20 established that it differs from Texas law. We agree with Frank=92s = Casing.

=20 The excess underwriters never requested that the trial court = apply=20 Louisiana law to the reimbursement = issue or=20 clearly asserted that Louisiana law applies. Instead, a = footnote in=20 their motion for summary judgment simply alluded to Louisiana law =93[t]o the extent [it] might = apply to this=20 case,=94 and then cited two Louisiana statutes, Louisiana Civil = Code=20 articles 2055 and 2298, and two cases, Edmonston v. A-Second Mortgage Co., = 289 So.=20 2d 116 (La. = 1974), and=20 E.F. Minyard v. Curtis Products, = Inc., 205=20 So.2d 422 (La.=20 1967), generally allowing recovery for unjust enrichment. Neither = the=20 statutes nor the cases cited specifically addressed an insurer=92s right = to=20 reimbursement from its insured when it settles a claim that is = ultimately=20 determined not to be covered, absent an express agreement.[4] In addition, after this Court = issued its=20 decision in Matagorda=20 County, the excess = underwriters=20 again briefly cited general Louisiana unjust-enrichment law in = their=20 response to Frank=92s Casing=92s motion for reconsideration of the trial = court=92s=20 partial summary judgment on reimbursement. After arguing at length that=20 Matagorda County did not govern reimbursement in this case, they = added a=20 final three-paragraph section entitled =93Louisiana Law Governs Excess=20 Underwriters=92 Right to Reimbursement.=94 They still did not ask the = trial court to=20 apply Louisiana law, however, but = instead=20 merely argued that Louisiana law = would allow=20 reimbursement =93[t]o the extent this Court finds Louisiana law controlling.=94 Even = if the excess=20 underwriters had clearly requested the court to apply Louisiana law, we cannot tell from the = authorities they=20 have cited how a Louisiana court would resolve the = issue before=20 us. As the party advocating the application of Louisiana law, the excess underwriters bore the = burden of=20 establishing that it differed from Texas law to=20 overcome the presumption that it is the same as Texas=92s. See Gevinson v. Manhattan Constr. Co. of Ok., 449 = S.W.2d=20 458, 465 n.2 (Tex. 1969); see also Unocal Corp. v. Dickinson Res. = Inc.,=20 889 S.W.2d 604, 607 n.2 (Tex. App.=97Houston [14th Dist.] 1994), writ = denied=20 per curiam, 907 S.W.2d 453 (Tex. = 1995).[5] Because they have not, we = presume that=20 the outcome would be no different under the foreign state=92s law.

VI. Conclusion

=20 We hold that the excess underwriters have not established a right = to=20 reimbursement under Texas law, nor = have they=20 established that the application of Louisiana law would produce a = different=20 result. Accordingly, we affirm the court of appeals=92 judgment.

&nbs= p; = ; = &= nbsp; &n= bsp; =20 ___________________________________

&nbs= p; = ; = &= nbsp; &n= bsp; =20 Harriet O=92Neill

&nbs= p; = ; = &= nbsp; &n= bsp; =20 Justice

OPINION = DELIVERED:=20 February 1, 2008

^[1]=20 We received amicus curiae briefs from United Policyholders; Pilco, Inc.; Shell Oil Co., Motiva Enterprises = LLC,=20 Burlington Resources Inc., Temple-Inland Inc., and Brad Fish, Inc.; the = Texas=20 Association of Defense Counsel; the Texas Civil Justice League; and Fred = A.=20 Simpson and Randall L. Smith, opposing a right to reimbursement under = these=20 circumstances. These amici argue = generally that=20 allowing reimbursement would distort the process of settling third-party = liability claims and would allow insurers to extract contributions from = their=20 insureds that their policies do not support. = The=20 Complex Insurance Claims Litigation Association and the Property = Casualty=20 Insurers Association of America submitted briefs supporting the = underwriters=92=20 right to reimbursement.

^[2]=20 The policy defines =93ultimate net loss=94 as =93the total sum which the = Assured, or=20 his Underlying Insurers as scheduled, or both, become obligated to pay . = . .=20 either through adjudication or compromise . . . . =94

^[3]=20 The title of this clause is not clear on any portion of the record; = Frank=92s=20 Casing refers to it as a =93Loss Payable=94 clause, a characterization = that the=20 excess underwriters do not dispute.

^[4]=20 In Edmonston, for example, the court = held that=20 a widow who had unwittingly conveyed a home worth more than $24,000 to a = mortgage company to satisfy a $5,178.24 second mortgage could recover = under=20 Louisiana=92s unjust- enrichment statutes. 289 So.2d = at=20 122. In Minyard, the court = considered=20 when limitations had run on a subcontractor=92s claim to recover from a product supplier amounts it had paid to = compensate the=20 contractor for defective caulking. 205 So. 2d at = 638.=20 The court merely equated the subcontractor=92s claim seeking indemnity = with an=20 unjust-enrichment claim in determining the appropriate limitations = period.=20 Id. at 650,=20 653. In response to Frank=92s Casing=92s motion for = reconsideration of the=20 trial court=92s partial summary judgment on reimbursement, the excess = underwriters=20 cited a suit in which a court held that an insurer was not liable for = statutory=20 bad-faith penalties because the insurer had sought reimbursement of = settlement=20 costs. Peavey Co. v. M/V ANPA, 971 F.2d 1168 = (5th Cir.=20 1992). In reversing the penalties, the Fifth Circuit noted that = the the insured had stipulated that it would be liable = to=20 reimburse the insurer if coverage was resolved in the insurer=92s favor. = Id. at=20 1177.

^[5]=20 The excess underwriters contend that the presumption that another = state=92s law is=20 the same as this state=92s does not apply because Louisiana law is not based on the = common law,=20 citing 29 Am. Jur. 2d Evidence =A7 259 (2002). Neither we nor = any other=20 Texas court=20 has recognized this distinction. In fact, we recently indicated that the = presumption would normally apply in a case involving Louisiana = law. Coca-Cola Co. v. Harmar = Bottling=20 Co., 218 S.W.3d 671, 685 (Tex.=20 2006).