finished with katrina so i don't think ike's going away to the trial court below committed error when it dismissed my client's claims on summary judgment because we put on evidence demonstrating a fact question on both the contents portion of our policy claim as well as a claim for the penalty interest eighteen percent one ground and only one ground and that was we invoked the appraisal process we paid the award therefore we are not liable for any other liability one way or the other that is you or your appraiser object to the exclusion of contents damages once you receive the check no we did not know but we do need to because it was not the proper the record the way it came in but the context of the summary judgment proceedings is in their motion for summary judgment they said you know now that the president has been issued we you know this is the first time that they've said that they have a claim for breach of contract on the continent and we respond by saying no no back at two years before that in may of two thousand and eleven it was part of our disclosure responses and that's in the record in our summary general response so that the position that novelists took that there was no claim for contents made wasn't in their motion for summary judgment it was in their reply to our spots and of course at that point you know we the proceeding was wrapped up with their reply and so it wasn't a proper round to be made at that point if you want to make the point that you know my client's waves were never made it a claim for contents a should have done it in their motion for summary judgment in the in the princip appraisal board importantly the policy obligated novelis to do certain things that had to request information that it needed to properly adjust the client presumably would have included the contents it had to request a proof of loss novelis made the point in his reply when i looked at the policy a duties in the event of loss the requirement is that you've got to give them proper notice of the loss or damage including a description of the property involved then they can request a complete inventory so as to that first three element you made a request that included content damage yes my client submitted a claim for hurricane ike damage well there's nothing in the record this says you know it's only for structure or its structure and contents and other things it says we've we've got a bunch of damage out here the but the description of the property as required by the policy included contents yes contents was definitely covered under the policy there's no no but your your description that you gave them notice of if it didn't distinguish title why is it did contain items and property items described inside the house i'm sorry it's not the two properties be that well the record is not to speak to that you know the claim was made through my client's entrance agent that's how it was made which is very typical in these in these areas the way novelists was handling these claims pretty much allowed it to stick its head in the sand with respect to a lot of things one of them was whether or not the insured had a con novelis had no jesters in texas is hard independent adjustors who they were frankly working like dogs the jester who inspected my client's properties spent a very short amount of time both commercial properties big properties he testified in his deposition that his novels had him inspecting five disks five to six properties a day commercial properties at day and he was writing the reports at night after the the adjuster came out inspected the last that's the last time ah clients heard from novelist or the adjuster they got the checks and the never heard from again after that once my client got the checks will then of course they complained to the their agent that you know the amount more than half of the structure but what about contents of the whole she bang and of course there's no response from novels because they don't have a presence in texas so the when you when you're a jester working hurricane climbs and you are experienced like this it just was and he testified that he understood that part of the damages you know would include contents because of catastrophic nature of the loss any testified in his deposition which is in the record and after looking at some pictures that there were security cameras that had been damaged by the hurricane covered under the policy and he just missed them as he testified he dismissed them so you know yes the duty to submit the claim is on the insured but after that because of the disparity between the sophistication the bargaining matters for which no claim has been made and so you know at some point in the war the question is cases how soon it's going to be up to the insured to indicate what is not what what nautilus what insurance co not properly paid for is not properly reviewed for a possible claim and the decision i was about just to court is that came up too late well you know what you have any support that it was there was no offices obligation  in the justing this independent of your cause obligation to make the claim itself that they had to identify things that for which no precise claim has been made yes your honor i do the texas supreme court has spoken on this issue numerous times giles and several other opinions where the court has said part of the duty of good faith and fair dealing on the insurance company is to conduct a thorough and reasonable investigation and in order to do that you can't just stick your head in the sand and look at just one aspect of the loss you've got to ask questions you have to request information and not of his own policy requires it to do that if not all  policy and says give me information about your client which it never did the policy and this is the insurance code requires it to do that give me information about your client and of course my clients are going to include contents among the things that they logically if evans goes and looks at it and he whatever his testimony was i take it he said nothing about whether flood ensure was covering anything but he says this is what you are when they just pay they would waive the proof of loss requirement logically if they're intention to play pay full that's that's a whole point is that there's a reason why this it was structured this way so that they could you know avoid the questions avoid the information coming in that would demonstrate that their payments would be under payments well one of the realities in this sort of event is if you have flood insurance and you have wind insurance and certain things have paid by each and if that's incorrect of normal it would have covered some things that in flood insurance policy would have covered as well unless i have it backwards but i take it this is the notices we're looking at whether that was right or wrong and even that and we're even aware that's why it happened but the issue before us is legally who is responsible if there were no oversight them there's been no determination yet that you weren't anything more these was a possibility is that let's get the proper payment statute under the texas insurance co chapter five forty two is designed to make sure the insured are not only paid promptly but sufficiently as well that's why the first requirement this is not something that the carrier could wait the first requirement is that the carrier has to request information a site for have said look you know even if you don't request information you have violate temperament forty two because it's an important part of what they have to do inserts don't know they don't know how to make sure their claim is sufficiently investigated that's not it's not sunny even something that we can reasonably expect for them to know that's why the courts have said look there's a disparity here you've got the insurance companies with all the power all the resources all the bargaining power and you've got the insured who really don't know anything about this stuff so under chapter five hundred two the first thing you've got to do is request the information and then once you get the information you need in order to get a proper proof of loss then that's when the time period begins to tick or when you have to submit your payment it's a very important part of the process so it is true you know the record is not going to tell you that my clients called up  motion for summary judgment we demonstrated that not only did they fail to request information but they failed to make the time it's both the cradle ossie or the pre lawsuit the payments that failed to make them within the deadline set out  response to novices motion for summary judgment we said our five forty two claim is supported by this evidence that they violate these provisions of chapter five forty two and all these cases that novelists were lives on where the courts upheld oh there you are stopped or you know you don't get eighteen percent penalty when there's an appraisal warble that they don't really say that what they say is look a five forty two climb climb it just like anything else if it's talons down summary judgment you need to put know a remedy because the appraisal war demonstrates that the liability was greater than what they were originally paid that's not how it works you have to put on more evidence you have to show that there was a creep raise or breach of the breach you're seeing existed that triggered the five forty two under a set of amount of time that might respond under five forty two the breach is one failure to request information on the claim on the client triggers five forty two and we put on substantial ev blossoms and on the not even opinion united neurology versus hartford which is a southern district opinion that this court affirmed without an opinion about three weeks ago in each of those cases the complaints that were presented to this court were the exact same type of complaints that mr forbes client raises here pretty appraisal breach of chapter five forty two three appraisal breaches of the insurance code the texas deceptive prayed practices act complaints about the time complaints about consequential damages complaints about claims that were not raised timely all of those claims were in bloom's and in united neurology and in each of those cases the district court granted summary judgment and in each of those cases this  affirmed in united neurology in particular the claim was that a business income claim wasn't made until three years after the storm and it was not part of the appraisal and in that court judge harman out of the southern district issued a very long opinion and explained why in this case there was no evidence to support that claim and it was on time and that's exactly the case we have here with the contents claim with regard to the contents claim mr forbes says that a claim was made the claim was in fact not made contacts the reason it's not in the record is that it simply doesn't exist there was no priest suit demand in fact as it shows in our brief when nautilus was first sued was the first it was aware that it had a problem the adjusters called and asked mr fox's office is there a demand is there an estimate what did we miss and after kind of putting them on for a month about what they were going to present them so that because my clients desire was to resolve it without having to hire a lawyer they were eventually told we don't have an estimate your lawyer is going to have to answer the lawsuit the case went into the case went into litigation nautilus demanded appraisal they resisted this case went on long enough that it went through an entire the entire discovery process while the motion to compel appraisal was pending it was only after the discovery process was complete all the way to where we  pretrial order that the court ordered us to appraise the case there was no discovery on tontines no documents were produced no estimates were made they designated no experts when asked direct questions in depositions mr and mrs quid out both mentioned nothing about contents the reason the contents claim wasn't part of the appraisal is a claim simply wasn't made respectfully mr forbes has the duties reversed as to who has to do what on a claim this court has held and the texas supreme court has held that the insured has a duty to make a claim that do the duty encompasses telling the carrier what they are claiming was damaged the carrier has no duty to fish around and ask what kind of claims they've made and that's that what provision of this policy being as specific as possible contains that element and what's the supreme court use you say that's so clear on that point on that issue what i'm talking about is and it's cited in our brief and you look overseas allied pilots and that's on page twenty five of our brief decided to sixty two southwest second seven seventy and three this is a quote from the supreme court two thousand and eight the insurer has neither a right nor a burden to assert non coverage of a risk or loss until the insured shows that the risk or loss is covered by the terms of the policy and the corresponding policy provision here is that the one that i would mention yes it's the terms and conditions of the proof of last language where it sets out the duties in event of nautilus requested proof of loss multiple times and that they outright refused to sign they work even after litigation commence they outright refused to sign a proof of loss and that's and that's in the record in the magistrate mentions that in his opinion and that something they didn't object to simply put on the contents issue novelist is under no duty to investigate that further this is a wind policy there was a flood claim and as mentioned in our brief they made it they made a contents claim with the flood carrier this building had five feet of water in it from flood the contents all the contents claim was paid by your policy say about the fact that if there is a flood i'm sure we will be live my policy excludes damage by flood my policy doesn't address what happens if there is a combined wind and flood loss nautilus by the agent but it's not part of this record is my understanding that that that is not part of the record would that not have children i believe it would it potentially would show something form general practice is not even to the policyholder it depends on that agent's practice a copy would have been sent by the agent to my client and it would have been given to mr with regard to the contents claim simply put it wasn't raised and it wasn't we admit it was not part of the appraisal it was simply not raised by anybody in his brief what do you mean by we know it wasn't part of the appraisals were part of do we know what direction the appraisal process we're told just to look at the structure or just to look at the contents however you would exclude call into the no sir the appraisal was and to abate the case so if it was part of the lawsuit it was part of the appraisal at that point mr equipment owes mr coote as brief asserts that his appraiser didn't raise it with our appraiser or it's his duty to make that claim at that point if it's still in the law the direction would have been what you just articulated to appraise the claims involved in this lawsuit correct so if it was part of the lawsuit that was subject to the scope of appraisal if it was not and mind you this is a lawsuit that went through the discovery process a pretrial order was filed the proposed jury charge was filed there's simply no mention in the pretrial order is in the record in those documents or in the record that deposition testimony is in the record there's simply no mention of a contents claim being made in any of those documentations and all of those items were in the record at the time court the court ordered appraisal where in the record we first became aware that mr quinn i was making a contents claim after the appraisal award was issued and after we made the payment and we asked him to and in response to his motion for trial setting was just what do we know about the overpaid he would be and that's the nature of what the truth could be did about it the insurance company intentionally overpaid these claims frankly because they thought it was more expedient to pay the replacement cost value even though it was an actual cash value up front were present in each was a total payment of it's not based on it wasn't based on a percentage i'll tell you the total overpayment was ten thousand five hundred  that are written in such a faction fashion that all the insured is entitled to upfront is the actual cash value of the damaged property and if they do the work within six months they are entitled to recoup the full replacement value of the policy  my client made the decision to pay the replacement cost value up front and mr could have simply never did the work they also didn't charge him all of the deductibles on purpose because he was under insured on his sign his sign coverage was only a thousand dollars mr evans estimated that that sign was actually didn't estimate he received a receipt from mr quinn video that it was a twenty nine hundred dollar sign so instead of charging the twenty five hundred dollars deductible they kind of for lack of better phrase eight one thousand eight hundred of the deductible to balance that out and that and that brings up if that answers your question if that brings up another point that i would like to raise mr fabius asserted that nautilus never asked for additional information that's simply not true and shown in our brief on october fourteenth when he inspected the side mr cooper mr quixano was asked by mr evans for evidence for a receipt regarding the resign he had said he had to have some separate repairs and some for of some other information and mr kudo provided that information on december first and mr kudo's deposition testimony which is in the record in our brief corroborates that so to the extent you want to talk about five forty two timelines based upon asking for additional information which is what mr father says and i believe is correct you you should do those run from december first when the record shows mr kudo provided the information asked for in october i'd like to turn now to his five forty two claims you know generally while i have a few minutes left these exact claims are simply precluded as a matter of all these kind of pretty appraisal five forty two claims and the reason is this court has held that you can't make a chapter five forty two claims until the insurer is found liable for breach of contract and i'm talking about the go versus  from twenty fifteen and this is in our brief and that cites to the higginbotham versus state farm case which is in one thousand nine hundred seven case from this court while it is true that there is no good faith there is there  good faith defense to failing to comply with the five forty two deadlines these cases make clear that the insurer first has to be found liable for breach of contract and there's simply no finding that they're liable for breach of contract and the only breach of contract claim raised here today deals with the contents claim without that finding five forty two claims are simply barred as a matter of law in these type cases and that's and that was what was held in united neurology by the district court that was affirmed last month by this court beyond the fact that there are simply precluded as a matter of law in this situation these claims were not properly preserved for presentation of this court the five forty two claims were not present in the pretrial order there are very good rest references someone may be looking to  five forty two claim but the necessary specificity due to the arcane nature of the chapter requires that he specifically set out which section of five forty two he asserts we violate there's half a dozen different  nowhere in the pretrial order or in the pleadings is there a specific reference to any section specific section of five forty two that it's allegedly violating whether it's the failure to request information he mentioned here today a failure to pay none of that is present in response to this argument mr quit oh has referenced other sections they were he says that it was close enough in the pretrial order in the contested issue of fact section he raises questions about five forty one specifically not chapter five forty two he asserts that there are questions about five forty two in the jury charge that's simply not true there is no chapter five forty two question in the proposed jury charge also admit to this court that if he had if the case had actually been tried and if the case was presented to the jury based on the questions present there would not be an opportunity for a five hundred to claim there simply wasn't a question asked he says he has predicate questions well there's a couple of questions about when did nautilus request the information but no follow through in order to have it checked proper chapter five forty two charge  the charge was specifically established that the insurer is liable for the claim and that the insurer violated the specific section of the act alleged and that's from salinas versus state farm which is a case from this court in two thousand and two that simply wasn't present there simply wasn't a five forty two claim being made at that time after that the case went to appraisal the case was abated after appraisal when our summary judgment was fi dismissing plaintiff's claim for penalty interest under five forty two of the texas insurance code because as demonstrated in point of summary judgment response they are entitled to that interest for the time period proceeding defendant's untimely payments and on the amount the appraisal award up until  defendant invoked appraisal it doesn't mention any specific sections to the extent it's anything to this extent that is anything that is certainly not a failure to investigate under five forty two could it be a chapter file a section five eight claim which is within seventy five days of having all the information you have to do you have to pay i'm willing to admit that when i read that that's what i think i don't think that's the standard  even then that runs off the data which we had all the information and the record reflects that information was requested on october fourteenth it was given on december first and the payments were made on january sixth and eight as to robbery even the brits th payments were made on january sixth and eight yes the additional information was received on summer one i believe the only information that was provided was asked to one property  i only have about a minute have left so just deal the only other thing i would like to add is he asserts that he complained to the agent there's no evidence in the record that the agent ever asked nautilus to do he just assumed his agent would handle it well that's that that's his agent not our agent and we had no record of contact by the agent the record is devoid of anything from the agent one way or the other it's simply unfair to to to require nautilus to to continue to chase someone who never made a claim about any of these issues until the suit was brought claim opened is that ten or twenty two two thousand and that now that's very general and there's a reason why that's general because when a claim is being made to a carrier for a hurricane loss it's a claim in the litigation the record at thirteen forty eight shows that we filed disclosure burnished full disclosure is back in may of two thousand and eleven which was a year or so before the summary judgment requested proof of loss and i think a very unusual action after the lawsuit was filed but not before certainly not during when the claim was being adjusted so that he should be corrected the bottom line is that when you've got a line open items was a security camera security cameras which were up higher than the flood level which is why the the novelist as independent adjuster admitted that he missed those as being covered damage contents other things would be they had that alarm system a believe that was in the closet of you know the flood line and other things of that nature clearly even it will lower than the flood level would not be covered under these policies but carrier does not have the right to say oh flood we're going up to look at that they should have to go in and try to make it this sort of big continent on maybe continents or anything that that is that you can detach so you're you know you're technically you're your driver or you're of it those are all content and entrance policies importantly you know owners here's what novelist and many other insurance companies positions is today with respect to five forty two the payment cla dollars that's that's what we have an itemized drawer and i don't we itemize the contents coverage of this policy at around fifty thousand dollars ok that's not amount to put on what were the other security cameras and the this is a you know this eighteen percent penalty but they're also saying however when there's an appraisal award you are a stopped from pursuing your breach of contract claim always that's what they're saying so in other words are saying has t payments that are untimely thereafter to any claims that's what they're saying once there's an appraisal award that's paid they're saying in their positions also it is we do not owe eighteen percent penalty on anything so because they're saying that we are stopped from pursuing every to contract plan but if that's the case how can we ever if there's an appraisal ward prove the liability under the contract in order to get the eighteen percent penalty you can't postpone when they're going to present was ordered  purpose of the appraisal and is this when we disagree on the amount meaning you say it's x amount we say it's y then either of us can force the other you never agree with regard to content  car no that's my point you got it because you never looked into it and came up with a number it wasn't even the proper subject of the president is wholly complete you failed to comply with their duties with respect to the contents claimed they didn't look at it they knew anything about it so they couldn't now but that brings up another porn point and time however you can't there are very few circumstances in which you as an insured can say no to appraisal if the insurance company invokes appraisal you have to go through that process which is fine except that now you have insurance companies like this one saying oh but once we get that appraisal warden pay it means that because you can't establish liability because you're stopping a breach of contract you never get eighteen percent penalty so doesn't matter what the insurance company to board that under this argument if they invoke in full pay the appraisal ward you don't ever get the eighty percent penalty or the attorney's fees required to sue the insurance