* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not

be published and is not precedent except under the limited circumstances set forth in 5TH CIR.

R. 47.5.4.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 06-41723

VIRGINIA SURETY COMPANY INC

Plaintiff-Appellee

v.

GEORGE ROYLE WRIGHT, doing business as Wright & Associates GMAC

Real Estate

Defendant-Appellant

Appeal from the United States District Court 

for the Southern District of Texas 

USDC No. 5:05-CV-101

Before KING, BARKSDALE, and DENNIS, Circuit Judges.

PER CURIAM:*

For this Texas diversity action, George Royle Wright contests the

summary judgment awarded Virginia Surety Company, declaring it had no duty

to defend or indemnify Wright in the Texas state-court action filed against him.

The district court held the policy’s conditions to coverage were not satisfied

because Wright could not establish notice of the state-court action was first

received subsequentto the policy’s inception date. Primarily at issue is whether,

United States Court of Appeals

Fifth Circuit

F I L E D

January 22, 2008

Charles R. Fulbruge III

Clerk
No. 06-41723

2

under Texas agency law, notice of the state-court action received and signed for

by Wright’s employee prior to that inception date is imputed to Wright.

AFFIRMED. 

I.

In 2000, Laredo Independent School District (LISD) and Wright entered

into a “real estate broker/client relationship”, by which Wright agreed to assist

LISD in negotiating for, and acquiring, real property. Unsatisfied with the price

paid for that property, LISD filed the state-court action against Wright on 10

June 2004, asserting, inter alia, he made fraudulent representations regarding

the value and condition of the property, causing LISD to pay more than market

value. On 25 June 2004, Wright submitted notice of the action to his

professional liability insurance carrier, Virginia Surety, for coverage

consideration. (The policy’s inception date is 7 March 2004.) The company

agreed to provide a defense but reserved its right to withdraw. 

After assuming Wright’s defense, Virginia Surety learned of a demand

letter sent to Wright by LISD’s counsel on 27 October 2003 by certified mail,

return receipt requested. The demand letter, mailed to Wright’s office, gave presuit notice of LISD’s complaint, as required by the Texas Deceptive Trade

Practices Act. Receipt was acknowledged on 28 October 2003 by one of Wright’s

employees, Nora Manzo, who signed the receipt. Manzo was primarily a

property manager but testified she received mail on occasion. Wright concedes

Manzo signed the return receipt bearing the words “demand letter” but

maintains he never personally received, or was made aware of, that letter until

Virginia Surety notified him about it. 

LISD’s demand letter was received by Manzo prior to the policy’s 7 March

2004 inception date. The policy covered wrongful acts only if all four of the

following conditions were satisfied: 
No. 06-41723

3

1. the wrongful act took place on or after the

Retroactive Date; 

2. prior to the inception date of th[e] policy period

no Insured had knowledge of such wrongful act

and had no basis to reasonably anticipate a claim

that would be covered by this policy. . . .; 

3. the claim arising out of the wrongful act is first

made against any insured during the policy

period; and 

4. the claim is reported in writing to [Virginia

Surety] no later than 60 days after the end of the

policy period or, if applicable, during an extended

claims reported period . . . . 

(Emphasis added.) The third condition to coverage is primarily at issue here.

In August 2004, after becoming aware ofthe LISD demand letter, Virginia

Surety denied coverage and withdrew from Wright’s defense. Virginia Surety

filed this declaratory-judgment action in May 2005, seeking judgment that, for

the LISD litigation, there is no coverage, including no duty to defend or

indemnify, under the policy. Wright counter-claimed for, inter alia, a declaration

that Virginia Surety owes a defense and indemnity for that litigation. 

Cross-motions for summary judgment were filed; and, on 9 November

2006, the district court granted judgment for Virginia Surety, denying Wright’s

cross-motion. The district court focused on the third condition for coverage,

holding: no genuine issue of material fact exists on whether Wright could

establish the claim arising out of the wrongful act was first made against him

during the policy period. The court, applying Texas agency law, found Manzo

was Wright’s agent and, therefore, imputed to Wright her pre-inception-date

receipt of the demand letter. 
No. 06-41723

4

II.

As noted, Wright must satisfy all four conditions to coverage under the

policy. In other words, Virginia Surety prevails if it establishes Wright cannot

satisfy any single condition. The district court held no coverage was required

because Wright could not satisfy condition three and addressed no other

conditions. Therefore, our analysis begins with whether Wright was first made

aware of LISD’s claim prior to the policy’s 7 March 2004 inception date. For this

diversity action, Texas law, of course, applies. Specifically, at issue is whether,

under Texas agency law, Manzo’s pre-inception-date receipt of the demand letter

may be imputed to Wright. 

A summary judgment is reviewed de novo, applying the same standards

as did the district court. E.g., Nat’l Union Fire Ins. Co. v. Willis, 296 F.3d 336,

339 (5th Cir. 2002). Such judgment is appropriate when there is no genuine

issue of material fact and the movant is entitled to judgment as a matter of law.

FED. R. CIV. P. 56(c); see, e.g., Celotex Corp. v. Catrett, 477 U.S. 317, 322-23

(1986).

A.

Wright maintains our analysis is narrowed by language in the policy and,

therefore, a “limited” agency analysis is applied to whether he received notice of

the 27 October 2003 demand letter. In applying agency law, however, the policy

terms are not supplemented; general agency principles are applied to the policy.

As recognized by the district court, contractlaw may be supplemented by agency

law. See, e.g., Mississippi v. Richardson, 817 F.2d 1203, 1207 (5th Cir. 1987)

(applying Mississippi agency law); RESTATEMENT (SECOND) OF CONTRACTS § 52

(1981) (“The rules stated in the Restatement . . . are supplemented by the law

of agency, and in the absence of [a] contrary statement it is assumed that any

necessary act may be performed on behalf of a contracting party by his agent.”).
No. 06-41723

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B.

It goes without saying that, “[u]nder general principles of agency law,

notice to an agent is deemed notice to the principal if the agent’s acts were

within his authority”. Norwood v. Litwin Eng’rs & Constructors, Inc., 962

S.W.2d 220, 225 (Tex. App. 1998) (citing Polland & Cook v. Lehmann, 832

S.W.2d 729, 738 (Tex. App. 1992)); see also Grissom v. Watson, 704 S.W.2d 325,

327 (Tex. 1986). When, as here, there is no genuine issue of material fact,

whether an agency relationship exists is a question of law. Campbell v.

Hamilton, 632 S.W.2d 633, 635 (Tex. App. 1982). The general rule in Texas

regarding the creation of an agency relationship follows:

“As between parties to the relation, there must be a

meeting of the minds in establishing the agency, and

the consent of both the principal and the agent is

necessary to create the agency, although such consent

may be implied rather than expressed. The principal

must intend that the agent act for him, the agent must

intend to accept the authority and act on it, and the

intention of the parties must find expression in either

words or conduct between them.”

Elite Towing, Inc. v. LSI Fin. Group, 985 S.W.2d 635, 643 (Tex. App. 1999)

(quoting Grissom, 704 S.W.2d at 326). “An agency relationship may be found

from underlying facts or direct and circumstantial evidence showing the

relationship of the parties.” Id. (citations omitted). 

Atissue in Elite Towing was whether the appellant received proper notice

of a trial setting. Id. at 642-44. The court found the notice was correctly

addressed to appellant’s attorney and sent by certified mail, return receipt

requested. Id. at 638. The certified notice was received and signed for by

another attorney, who was with another firm in the building. Id. The court

recognized the other attorney had on occasion signed for mail on behalf of
No. 06-41723

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appellant’s attorney, and held a principal-agent relationship existed. Id. at 644.

Notice of the trial was imputed, therefore, to appellant’s attorney. Id.

The facts at hand are even more compelling for there being an agency

relationship than those in Elite Towing. On 27 October 2003, LISD mailed a

certified letter, return receipt requested, to Wright, notifying him of its intent

to sue. The following day, the return receipt was signed by Manzo, an employee

in Wright’s office since 1996. Wright maintains a genuine issue of material fact

exists on whether Manzo was his agent for purposes of receiving mail. Manzo,

however, was a long-time employee of Wright and had accepted mail for Wright

on prior occasions. In fact, Wright admitted he personally received the mail only

on Saturdays; on other days it was delivered to someone else in his office. Along

this line, Wright’s office procedure did not prohibit Manzo, or any other

employee, from receiving the mail. 

Therefore, no genuine issue of material fact exists on whether Wright

“intend[ed] that [Manzo] act for him, [and Manzo] . . . intend[ed] to accept the

authority and act on it”. Id. at 642-43. Accordingly, an agency relationship

existed, and notice of the demand letter to Manzo is imputed to Wright. See

Norwood, 962 S.W.2d at 225.

C.

For the first time at oral argument, Wright asserted this court should

distinguish between being an agent for purposes of receiving mail and being an

agent for purposes of signing for it. It is well settled that this court generally

“do[es] not consider assertions made for the firsttime at oral argument”. United

States v. Bigelow, 462 F.3d 378, 383 (5th Cir. 2006); see also United States v.

Ogle, 328 F.3d 182, 191 n.9 (5th Cir. 2003). We decline to reach this new issue.

III.

For the foregoing reasons, summary judgment was proper. 

AFFIRMED.