Affirmed and Memorandum Opinion filed March 26, 2020.

In The

Fourteenth Court of Appeals

NO. 14-18-00438-CV

JUNIOUS R. VALENTINE, Appellant

V.

FEDERAL INSURANCE COMPANY, Appellee

On Appeal from the 234th District Court

Harris County, Texas

Trial Court Cause No. 2016-78466

MEMORANDUM OPINION

Appellant Junious R. Valentine obtained a default judgment in federal court 

against his former employer (the Hospital) for employment discrimination. In this 

case, Valentine sued the Hospital’s insurer, appellee Federal Insurance Company, 

for breach of contract, Insurance Code violations, and conspiracy. The Harris 

County district court (the trial court) granted Federal’s motion for summary 

judgment on all of Valentine’s claims. Valentine challenges the trial court’s 

summary judgment in six issues. We affirm.
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I. BACKGROUND

The parties agree that the Hospital held an insurance policy with Federal that 

covered employment discrimination claims against the Hospital. The policy was a 

claims-made-and-reported policy that covered loss from a claim “first made 

against such Insured during the Policy Period . . . but only if such Employment 

Claim [was] reported to the Company [i.e., Federal] in writing in the manner and 

within the time provided in Subsection 12 of this coverage section.” Subsection 

12, as amended, provided that as a condition precedent to coverage, the Hospital 

had to give written notice of an employment claim to Federal “during the Policy 

Period, or, if applicable, in no event later than . . . 180 days after the end of the 

Policy Period.” The Policy Period was from November 3, 2013, to November 3, 

2014.

During the Policy Period, Valentine filed a charge of discrimination with the 

Equal Employment Opportunity Commission (EEOC) and then sued the Hospital

in a federal district court. On February 27, 2015, the Hospital petitioned for

Chapter 11 bankruptcy, and the federal district court subsequently dismissed 

Valentine’s suit pursuant to the automatic stay. On October 5, 2015, the 

bankruptcy court signed an agreed order lifting the automatic stay to permit 

Valentine to prosecute his case in the federal district court. The bankruptcy court 

ordered that “the automatic stay in this action is modified to permit [Valentine] to 

continue to prosecute the Lawsuit, provided that any settlement or judgment 

related to the Lawsuit shall be paid from [the Hospital’s] applicable insurance 

policies.”

The federal district court reinstated Valentine’s case, but less than a month 

later the Hospital filed a “notice of denial of insurance coverage and reinstatement 

of stay,” contending that the Hospital had been notified by Federal that insurance 
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coverage for Valentine’s claim had been denied. The Hospital contended that the 

federal district court’s prior order “dismissing and automatically staying this case 

should be reinstated” because there was no insurance coverage for Valentine’s 

claim. The Hospital attached Federal’s denial-of-coverage letter, which stated that 

coverage was denied because Federal did not report Valentine’s claim until 

October 9, 2015—outside the 180-day reporting period following the expiration of 

the Policy Period.

The federal district court ultimately rendered a default judgment awarding 

Valentine damages, attorney’s fees, and costs totaling $87,598. Valentine then 

sued Federal in a Harris County district court, asserting claims for breach of 

contract as a third-party beneficiary, violation of the Insurance Code, and 

conspiracy. In his live pleading, Valentine alleged that Federal breached the 

insurance policy by refusing to pay the federal court judgment. He alleged that 

Federal engaged in an unfair and deceptive course of conduct regarding the 

availability of coverage, failed to promptly pay the federal court judgment, and 

misrepresented a material fact of a policy provision relating to coverage and notice 

of the claim. Valentine sought damages for policy proceeds in the amount 

prescribed by the federal district court judgment and mental anguish damages due 

to Federal’s “wrongful conduct in denying coverage and delaying payment.”

Federal filed a traditional motion for summary judgment, and Valentine filed 

a response. Both parties attached evidence to support the procedural facts 

described above. Federal also filed a declaration from its adjuster on the Valentine 

matter. She testified that Federal’s “claim file” included Valentine’s charge of 

discrimination, the EEOC’s notice of charge, and Valentine’s complaint from the 

federal district court. She testified, “Federal did not receive notice of Valentine’s 
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claim from anyone before October 9, 2015.” She attached to her declaration the 

October 9, 2015 email notice.

Among other evidence, Valentine filed invoices from the law firm of Littler 

Mendelson P.C., which are dated within the Policy Period, describe the client as 

Federal, and describe the insured as the Hospital. The “claimant name” and some 

other details are redacted. Valentine also filed an email dated September 30, 2015, 

sent from the Hospital’s purported bankruptcy attorney at the law firm of Porter 

Hedges LLP to Valentine’s attorney, stating that the Hospital had “told us 

repeatedly that there is an insurance policy that would cover this, but they have 

been unable to locate it. They have requested a copy from the insurance company 

but are still waiting.”

In its motion for summary judgment, Federal argued that it was entitled to 

judgment on Valentine’s claims because there was no coverage under the terms of 

the policy due to the Hospital’s failure to provide notice within 180 days of the

Policy Period. Valentine responded that the motion should be denied because (1) 

there was a genuine issue of material fact regarding when the Hospital received 

notice; (2) the doctrine of collateral estoppel barred Federal’s attempt to relitigate 

untimely notice; (3) the Bankruptcy Code and policy terms barred Federal’s 

contention regarding untimely notice; (4) Federal had not established prejudice

from the untimely notice; (5) Valentine could assert Insurance Code violations as a 

third-party-beneficiary of the policy; and (6) Federal did not move for summary 

judgment on the conspiracy claim. The trial court granted Federal’s motion for 

summary judgment and ordered that Valentine take nothing on his claims against

Federal. On appeal Valentine raises these same arguments.
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II. STANDARDS OF REVIEW

We review a grant of a motion for summary judgment de novo. KCM Fin.

LLC v. Bradshaw, 457 S.W.3d 70, 79 (Tex. 2015). The party moving for a 

traditional summary judgment has the initial burden to show that there is no

genuine issue as to any material fact and that the movant is entitled to judgment as 

a matter of law. Lujan v. Navistar Inc., 555 S.W.3d 79, 84 (Tex. 2018). If the 

movant satisfies this burden, then the burden shifts to the nonmovant to raise a 

genuine issue of material fact precluding summary judgment. Id. We review the 

evidence in the light most favorable to the nonmovant, crediting evidence 

favorable to the nonmovant if reasonable fact finders could, and disregarding 

contrary evidence unless reasonable fact finders could not. Mann Frankfort Stein 

& Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009).

The interpretation of an unambiguous contract is a question of law that we 

review de novo using well-settled contract-construction principles. URI, Inc. v. 

Kleberg Cty., 543 S.W.3d 755, 763 (Tex. 2018). We presume that parties intend 

what the words in their contract say, and we interpret contract language according 

to its plain, ordinary, and generally accepted meaning unless the contract directs 

otherwise. Id. at 763–64. Similarly, statutory construction is a question of law and 

reviewed de novo. Sw. Royalties, Inc. v. Hegar, 500 S.W.3d 400, 404 (Tex. 2016). 

Our primary objective is to give effect to the Legislature’s intent, which we 

ascertain from the plain meaning of the words used in the statute if possible. Id.

III. BREACH OF CONTRACT

In his first four issues, Valentine challenges the trial court’s summary 

judgment on the breach of contract claim. We address his issues in the order

presented in his brief.
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A. No Genuine Issue of Material Fact Regarding Notice

In his first issue, Valentine contends that there is a genuine issue of material 

fact regarding when the Hospital received notice. Federal adduced evidence that 

notice was due no later than May 2, 2015, but Federal did not receive notice until 

October 9, 2015. Valentine focuses on three categories of evidence that he

suggests raise a fact issue about the date Federal received notice of the claim: (1) 

the adjuster’s declaration; (2) the Porter Hedges email; and (3) the Littler 

Mendelson billing invoices. 

First, Valentine contends that there are “contradictory facts” alleged in the 

adjuster’s declaration. Valentine suggests that the adjuster’s testimony that

Valentine’s EEOC charge and complaint were “in Federal’s claim file,” coupled 

with the adjuster’s testimony that the Hospital sent the same documents to Federal 

on October 9, 2015, means that Federal must have had notice of the claim before 

October 9, 2015. But the adjuster did not testify that Federal had the documents in 

its “claim file” before October 9, 2015. And the adjuster testified unequivocally 

that Federal did not receive notice of the claim before receiving an email on 

October 9, 2015. The declaration does not raise conflicting inferences regarding 

the date of notice.

Second, Valentine contends that the Porter Hedges email is more than a 

scintilla of evidence that Federal had notice of Valentine’s claim before October 9, 

2015. But the email indicated only that the Hospital believed it had insurance 

coverage for the claim and had asked Federal for a copy of the policy. This 

evidence does not transcend mere suspicion; any inference that Federal had been 

notified of Valentine’s claim would be merely a guess. See Ford Motor Co. v. 

Ridgway, 135 S.W.3d 598, 601 (Tex. 2004) (cannot raise a genuine issue of 
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material fact based on evidence so slight as to make any inference a guess; 

evidence must transcend mere suspicion).

Finally, Valentine contends that the Littler Mendelson invoices show that 

Littler was working with Federal on multiple employment-related matters for the 

Hospital in the summer of 2014 through March 2015 at the same time it was 

defending the Hospital in the federal district court suit. Valentine suggests it is a 

reasonable inference from this evidence that Federal had been notified of 

Valentine’s claim. However, the invoices do not refer to Valentine, and there is no

evidence to suggest that the invoices related to the Valentine matter rather than 

some other claimant. Valentine’s proposed inference is not reasonable because it 

would require the fact finder to guess to reach a conclusion. See Suarez v. City of 

Tex. City, 465 S.W.3d 623, 634 (Tex. 2015). The inference is based on mere 

suspicion. See id.

None of this evidence, considered individually or in total, gives rise to a

reasonable inference that Federal had been notified of Valentine’s claim before 

October 9, 2015, let alone within 180 days of the Policy Period. Because Federal 

presented undisputed evidence that Valentine’s claim was not a covered loss, 

Federal did not breach the policy by denying coverage.

Valentine’s first issue is overruled.

B. No Collateral Estoppel

In his second issue, Valentine contends that collateral estoppel bars 

Federal’s attempt to relitigate the issue of untimely notice because Federal is 

making the same argument regarding lack of coverage that the Hospital advanced 

in the federal district court suit, and because Federal and the Hospital were in 

privity. See Mid-Continent Cas. Co. v. Bay Rock Operating Co., 614 F.3d 105, 
8

110–11 (5th Cir. 2010) (“An insurer in a coverage case will be barred from relitigating a particular issue from the underlying liability case if: (1) the issue raised 

in the coverage suit was raised and determined in the liability suit; (2) the issue 

determined in the liability suit was essential to the judgment in the liability suit; 

and (3) the necessary requirement of privity exists between the insurer and the 

insured.”); see also John G. & Marie Stella Kenedy Mem. Found. v Dewhurst, 90 

S.W.3d 268, 288 (Tex. 2002).

For purposes of collateral estoppel, “An insurer and its insured do not share 

privity when they have a conflict of interest about the subject matter of the 

litigation.” Williamson v. State Farm Lloyds, 76 S.W.3d 64, 67–68 (Tex. App.—

Houston [14th Dist.] 2002, no pet.). “When an insurer and its insured take 

conflicting positions on the issue of coverage, they are not in privity.” Id. at 68. 

When there exists a conflict of interest in connection with the issue of coverage, 

the insurer’s interests are not the same as the insured’s, so the insurer is not in 

privity with the insured. See State Farm Lloyds v. C.M.W., 53 S.W.3d 877, 886–87 

(Tex. App.—Dallas 2001, pet. denied) (no privity when insurer provided a defense 

with reservation of right to contest coverage of the claims).

The evidence that Federal denied coverage to the Hospital is sufficient to 

overcome Valentine’s assertion of collateral estoppel—Federal and the Hospital 

were not in privity. See id. Valentine contends that the Hospital and Federal 

agreed there was no coverage, so they were in privity. Even if an insurer’s denial 

of coverage does not necessarily create a conflict for purposes of collateral 

estoppel, but see id., the Hospital’s “notice of denial of insurance coverage and 

reinstatement of stay” informed the federal district court that coverage had been 

denied, not that the Hospital agreed with Federal’s decision to deny coverage.
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Moreover, nothing in this record indicates that the federal district court made 

a ruling on the issue of notice. The record contains no order denying reinstatement

of the stay or any finding of fact on the issue of notice. Thus, nothing in this 

record indicates that the issue of notice was “determined” in the liability suit. And, 

whether the Hospital gave written notice to Federal within the time period 

prescribed by the policy was not essential to the federal district court’s liability 

judgment. See Emp’rs Cas. Co. v. Block, 744 S.W.2d 940, 943 (Tex. 1988) 

(insurer could contest coverage because recitation in judgment of liability suit that 

property damage was sustained as a result of an occurrence on a particular date 

was not essential to determining the insured’s liability), overruled on other 

grounds by State Farm Fire & Cas. Co. v. Gandy, 925 S.W.2d 696, 714 (Tex. 

1996). Thus, Federal is not barred by the doctrine of collateral estoppel from 

litigating the issue of coverage in this case.

Valentine’s second issue is overruled.

C. No Tolling Under Bankruptcy Code or Policy

In his third issue, Valentine contends that (1) the imposition of the automatic 

stay under Section 362 of the United States Bankruptcy Code (the Code)

“suspend[ed] any period to give notice under Federal Insurance’s insurance 

policy”; (2) the notice period under the policy was “tolled until the stay was lifted”

under Section 108 of the Code; and (3) the policy “acknowledges the effects of 

bankruptcy.”

1. Automatic Stay

The filing of a bankruptcy petition automatically stays, among other 

conduct, “any act to obtain possession of property of the estate or of property from 

the estate or to exercise control over property of the estate.” 11 U.S.C. § 362(a)(3). 
10

The automatic stay prevents the initiation and continuation of lawsuits or other 

actions against the debtor. See id. § 362(a)(1). The automatic stay encompasses a 

“wide swath of legal actions, including litigation, lien enforcement, and 

administrative proceedings, that could affect or interfere with the property of the 

bankrupt’s estate.” Checkers Drive-In Rests., Inc. v. Comm’r of Patents & 

Trademarks, 51 F.3d 1078, 1080 (D.C. Cir. 1995). Courts have held that insurance

policies are “property of the estate,” so a right to cancel an insurance policy can be

automatically stayed by the filing of a bankruptcy petition. See In re Minoco Grp. 

of Cos., 799 F.2d 517, 519 (9th Cir. 1986) (citing Eric W. Lam, Cancellation of 

Insurance: Bankruptcy Automatic Stay Implications, 59 Am. Bankr. L.J. 267

(1985)).

The automatic stay, however, does not stop the passage of time. See In re 

Lauderdale Motorcar Corp., 35 B.R. 544, 548 (Bankr. S.D. Fla. 1983) (citing In re 

Beck, 5 B.R. 169, 170 (Bankr. D. Haw. 1980)). Section 362’s “prohibition against 

actions taken to obtain possession of the estate’s property does not affect the 

tolling of time.” Ctys. Contracting & Const. Co. v. Const. Life Ins. Co., 855 F.2d 

1054, 1058–59 (3d Cir. 1988). Although the automatic stay prohibits certain 

affirmative conduct, it does not toll the running of statutory time periods that 

would result in the transfer of property to a creditor. See In re Maanum, 828 F.2d 

459, 460 (8th Cir. 1987); see also Ctys. Contracting, 855 F.2d at 1059 (automatic 

stay did not prohibit lapse of insurance policy under contractual and statutory grace 

period).

Valentine cites no authority to suggest that the automatic stay tolls the time 

period for reporting a claim under an insurance policy, and we have found none. 

Valentine appears to argue that because his own claim against the Hospital was 

stayed, the Hospital’s contractual duty to notify Federal of the claim, as a condition
11

precedent to coverage, was also stayed. Again, no case law supports this 

contention. The policy contradicts Valentine’s contention by providing that the 

bankruptcy of an insured shall not “deprive the Company of its rights or defenses 

under this policy.”

This case does not involve any affirmative conduct by Federal against the 

Hospital, but rather the mere passage of time. We hold that the automatic stay did 

not prohibit or toll the notice period in the insurance policy.

2. Section 108

Generally, Section 108 of the Code allows for the extension of time for 

debtors and claimants to do certain things after the debtor has filed a bankruptcy 

petition or the stay has been lifted. Valentine refers to the following subsections:

(a) If . . . an agreement fixes a period within which the debtor may 

commence an action, and such period has not expired before the date 

of the filing of the petition, the trustee may commence such action 

only before the later of—(1) the end of such period, including any 

suspension of such period occurring on or after the commencement of 

the case; or (2) two years after the order for relief.

(b) Except as provided in subsection (a) of this section, if . . . an 

agreement fixes a period within which the debtor . . . may file any . . . 

notice, or proof of claim or loss, cure a default, or perform any other

similar act, and such period has not expired before the date of the 

filing of the petition, the trustee may only file, cure, or perform, as the 

case may be, before the later of—(1) the end of such period, including 

any suspension of such period occurring on or after the 

commencement of the case; or (2) 60 days after the order for relief.

(c) . . . [I]f . . . an agreement fixes a period for commencing or 

continuing a civil action in a court other than a bankruptcy court on a 

claim against the debtor . . . and such period has not expired before 

the date of the filing of the petition, then such period does not expire 

until the later of—(1) the end of such period, including any 

suspension of such period occurring on or after the commencement of 

the case; or (2) 30 days after notice of the termination or expiration of 
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the stay . . . with respect to such claim.

The commencement of a voluntary bankruptcy proceeding, as here, constitutes an 

“order for relief.” See 11 U.S.C. § 301.

As several of the cases cited above suggest, the tolling of statutory or 

contractual deadlines may arise under Section 108(b) of the Code. See Ctys 

Contracting, 855 F.2d at 1059; In re Lauderdale Motorcar, 35 B.R. at 549. But 

under Section 108(b), notice of the claim in this case was still due no later than 

May 2, 2015. Section 108(b) does not help Valentine, and Valentine expressly 

disclaimed reliance on Section 108(b) to the trial court.

Section 108(a) refers to a debtor or trustee commencing an “action,” an 

undefined term commonly understood to mean a lawsuit. See In re Sims Bros. 

Builders, Inc., 35 B.R. 149, 150–51 (Bankr. S.D. Ohio 1983); see also In re 

Lauderdale Motorcar, 35 B.R. at 549. Section 108(a) is inapplicable because the 

Hospital’s contractual duty to notify Federal of claims as a condition precedent to 

coverage is not an “action” within the meaning of the statute. See In re Lauderdale 

Motorcar, 35 B.R. at 549 (debtor’s statutory deadline for seeking determination 

from state governing body regarding discontinuation of contract was not tolled by 

Section 108(a) because debtor’s right to protest was not an “action” by the debtor); 

see also In re Sims Bros., 35 B.R. at 150–51.

Section 108(c) refers to the expiration of periods for commencing or 

continuing a civil action against the debtor. Although Section 108(c) could have 

operated to extend limitations for Valentine’s filing of a civil action against the 

Hospital, Section 108(c) did not toll the time period for notifying Federal about an 

Employment Claim, as defined in the policy.
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3. Contractual Language

Valentine contends that some contractual language is rendered superfluous if 

the automatic stay does not result in the tolling of the notice provision. Valentine 

contends that a clause referencing bankruptcy is “intended to protect the insured 

while it is in bankruptcy under precisely the scenario presented here.” Valentine 

purports to quote the policy while arguing, “Federal Insurance’s own policy 

explicitly states that bankruptcy does ‘not deprive the [insured] of its rights or 

defenses under the policy” (alteration by Valentine). As quoted above, the clause 

refers to “Company,” i.e., Federal, in the place where Valentine has substituted

“insured.” Thus, the clause protects Federal’s defense of a failure of a condition 

precedent regarding notice. Nothing in the policy suggests that the notice period 

should be tolled during bankruptcy.

Valentine’s third issue is overruled.

D. No Requirement to Show Prejudice

In his fourth issue, Valentine contends that to avoid coverage based on the 

Hospital’s untimely notice, Federal was required to show prejudice under Texas 

law and the policy.

In Prodigy Communications Corp. v. Agricultural Excess & Surplus 

Insurance Co., the Supreme Court of Texas held that, for a claims-made-andreported policy, “when an insured gives notice of a claim within the policy period 

or other specified reporting period, the insurer must show that the insured’s 

noncompliance with the policy’s ‘as soon as practicable’ notice provision 

prejudiced the insurer before it may deny coverage.” 288 S.W.3d 374, 382 (Tex. 

2009) (emphasis added). In reaching this conclusion, the court reiterated the 
14

importance that a claim be reported within the time required for reporting. See id.

at 380–82. The court explained:

Because the requirement that a claim be reported to the insurer during 

the policy period or within a specific number of days thereafter is 

considered essential to coverage under a claims-made-and-reported 

policy, most courts have found that an insurer need not demonstrate 

prejudice to deny coverage when an insured does not give notice of a 

claim within the policy’s specified time frame.

Id. at 381 (collecting cases). The court agreed with the analysis of two other courts 

that had held prejudice was not required if the insured failed to report a claim, 

under a claims-made policy, during the policy period or other applicable reporting 

period. See id. at 381–82 (citing T.H.E. Ins. Co. v. P.T.P. Inc., 628 A.2d 223 (Md. 

1993) and Chas. T. Main, Inc. v. Fireman’s Fund. Ins. Co., 551 N.E.2d 28 (Mass. 

1990)).

This case involves a claims-made-and-reported policy, so Valentine’s 

authorities concerning other types of policies are inapplicable. Federal adduced 

undisputed evidence that Federal did not receive notice of Valentine’s claim within 

the Policy Period or the additional 180-day reporting period. Timely notice under

this policy is essential to coverage. See id. at 381. Because there was no timely 

notice, there is no coverage, regardless of any showing of prejudice. See id. at 

381–82; see also Nicholas Petroleum, Inc. v. Mid-Continent Cas. Co., No. 05-13-

01106-CV, 2015 WL 4456185, at *6 (Tex. App.—Dallas July 21, 2015, no pet.) 

(mem. op.). 

Valentine contends that the policy “explicitly provides that, absent a 

showing of prejudice, it may not deny coverage.” His reliance on other clauses of 

the policy is inapposite. He refers to the following clauses without explaining how 

these clauses require a showing of prejudice for untimely notice:
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• Under the policy’s “Defense and Settlement” section, “The 

Insureds agree to provide the Company with all information, 

assistance and cooperation which the Company reasonably 

requires and agree that in the event of a Claim the Insureds will do 

nothing that could prejudice the Company’s position or its 

potential or actual rights of recovery.”

• “With respect to the reporting of any Claim under this coverage 

section, it is agreed that in determining whether the reporting of 

such Claim has been timely made, the Company shall make such 

determination by applying the law of any jurisdiction which has a 

substantial relationship to the Insureds, the Company, this Policy, 

or the Claim and which is most favorable to such determination of 

timeliness.”

Neither of these clauses requires a showing of prejudice regarding untimely notice

of a claim.

Valentine’s fourth issue is overruled.

E. No Error to Grant Summary Judgment on Breach of Contract

Having overruled Valentine’s first four issues, we hold that the trial court 

did not err by rendering a summary judgment on Valentine’s breach of contract 

claim.

IV. INSURANCE CODE

In his fifth issue, Valentine contends that the trial court erred by granting 

summary judgment on his Insurance Code claim because (1) he is a third-party 

beneficiary of the policy as a judgment-creditor; and (2) he is a “claimant” under 

the Insurance Code’s statutory definition.

Although an insured’s judgment-creditor may be considered a third-party 

beneficiary sufficient to bring suit against an insurer for policy benefits, see P.G.

Bell Co. v. U.S. Fid. & Guar. Co., 853 S.W.2d 187, 189 (Tex. App.—Corpus 
16

Christi 1993, no writ), Valentine cites no case upholding a third-party’s claim

based on violations of the Insurance Code, see Reule v. Colony Ins. Co., 407 

S.W.3d 402, 411–14 (Tex. App.—Houston [14th Dist.] 2013, pet. denied) (thirdparty claimant lacked standing for violation of unfair settlement practice under 

Section 541.060 of the Insurance Code). Indeed, to be a “claimant” under the 

Insurance Code, the party must make a “claim,” which is defined as a “first-party 

claim that . . . is made by an insured or policyholder under an insurance policy or 

contract or by a beneficiary named in the policy or contract.” Valentine is neither 

a first-party claimant nor a beneficiary named in the policy. See Reule, 407 

S.W.3d at 411–14 (plaintiff was a third-party claimant even though she paid 

premiums and was entitled to liability coverage under the policy).

Even assuming Valentine could bring a claim under the Insurance Code as a 

third-party beneficiary, “[a]n insured cannot recover any damages based on an 

insurer’s statutory violation unless the insured establishes a right to receive 

benefits under the policy or an injury independent of a right to benefits.” USAA 

Tex. Lloyds Co. v. Menchaca, 545 S.W.3d 479, 490–501 (Tex. 2018) (discussing 

exceptions to the general rule that an insured cannot recover policy benefits if the

insured does not have a right to benefits under the policy). This rule is based on 

the statutory requirement of causation. See id. at 490, 499–500.

In its summary judgment motion, Federal relied primarily on Menchaca. 

Valentine does not refer to Menchaca, and he does not refer to any evidence of an 

injury independent of his purported right to receive benefits under the policy. In 

his petition, he sought only policy benefits and damages dependent on a right to 

benefits. Because the trial court did not err in granting summary judgment on 

Valentine’s breach of contract claim, and Valentine alleges no injury independent 
17

of a right to policy benefits, the trial court did not err by granting summary 

judgment on the Insurance Code claim.

Appellant’s fifth issue is overruled.

V. CONSPIRACY

In his fifth issue, appellant contends that the trial court erred by granting

summary judgment on the conspiracy claim because Federal did not move for a 

summary judgment on the claim. See, e.g., G & H Towing Co. v. Magee, 347 

S.W.3d 293, 298 (Tex. 2011) (observing that a trial court errs by granting a 

summary judgment on a claim not expressly presented in the written motion).

This type of error, however, is not reversible unless the error probably 

caused the rendition of an improper judgment or prevented the appellant from 

properly presenting the case to this court. See id. at 297–98 (citing Tex. R. App. P. 

44.1(a)). “[T]he error is harmless when the omitted cause of action is precluded as 

a matter of law by other grounds raised in the case.” Id. at 298. Reversal is not 

required if the “unaddressed claim is derivative of the addressed claim, and the 

movant proved its entitlement to summary judgment on the addressed claim.”

Wilson v. Davis, 305 S.W.3d 57, 73 (Tex. App.—Houston [1st Dist.] 2009, no 

pet.), quoted in Magee, 347 S.W.3d at 297.

Conspiracy is a theory of derivative liability, not an independent tort. See 

Agar Corp. v. Electro Circuits Int’l, LLC, 580 S.W.3d 136, 142–43 (Tex. 2019). 

Thus, assuming without deciding that the trial court erred, any error in this case 

was harmless because the trial court properly granted summary judgment on the 

underlying claims. See Macias v. Gomez, No. 13-14-00139-CV, 2014 WL 

7011372, at *4–5 (Tex. App.—Corpus Christi Dec. 11, 2014, no pet.) (mem. op.); 

see also Zarzana v. Ashley, 218 S.W.3d 152, 162 (Tex. App.—Houston [14th 
18

Dist.] 2007, pet. struck) (motion for summary judgment was sufficiently broad to 

encompass later-pleaded conspiracy claim because the motion addressed and 

negated the only underlying claim).

Valentine’s sixth issue is overruled.

VI. CONCLUSION

Having overruled all of Valentine’s issues, we affirm the trial court’s 

judgment.

/s/ Ken Wise

Justice

Panel consists of Justices Wise, Zimmerer, and Spain.