REVERSE in part; AFFIRM in part and Opinion Filed May 25, 2022 

# S

In The 

### Court of Appeals Fifth District of Texas at Dallas No. 05-21-00071-CV CENTRAL MUTUAL INSURANCE COMPANY, Appellant V. RELIANCE PROPERTY MANA GEMENT, INC., Appellee On Appeal from the 44th Judicial District Court Dallas County, Texas Trial Court Cause No. DC-18-00856 MEMORANDUM OPINION Before Chief Justice Burn s, Justice Schenck, a nd Justice Partida-Kipness Opinion by Chief Justice Burns After a jury trial in this insurance c overage dispute, the trial court rendered judgment for appellee Reliance Property Ma nagement, Inc. on its claim against appellant Central Mutual Insurance Company. Central now appeals, alleging the trial court erred by denying its motion for directed verdict, by disregarding certain of the jury’s answers and failing to disregard ot hers, and by failing to render judgment for Central. Concluding that the trial court rendered judgment in accordance with the jury’s verdict and the insurance policy’s terms, but that there was no evidence to support one element of damage s awarded by the jury, we a ffirm in part and reverse and render in part.–2– B ACKGROUND Reliance made a claim for a $220,000 loss under its 2016–17 commercial lines insurance policy issued by Central. Ce ntral denied the claim, citing certain conditions and exclusions in the polic y. Reliance sued, seeking damages and attorney’s fees for breach of contract, ba d faith in an insurance transaction, and deceptive trade practices. The cas e proceeded to a jury trial, where the parties offered evidence about the loss and the policy.
1. The loss Reliance is a small property management company that manages commercial properties. In May 2017, Reliance had thr ee employees: Robert Grunnah, its owner and president, Debbie Molitor, its secr etary and bookkeeper, and Alex Lilley, a property manager. Gr unnah and Molitor worked from different office locations, so they usually communicated by email. On Thursday, May 18, 2017, Molitor receive d an email that appeared to be from Grunnah asking if she could make onlin e wire transfers. The email showed that it was sent from Grunnah’s correct email a ddress. It included hi s usual “signature block” bearing his name, address, phone numbers, and the company logo for “Younger Partners,” where Grunna h’s office was located. The parties ha ve referred to the unknown sender of this and the othe r relevant emails as “Fake Robert.” Over the course of the following week, Fake Robert sent instructions to Molitor and Reliance’s bank officers at BB&T Bank to authorize Molitor to make–3– wire transfers for Reliance. Molitor took the steps required by the bank, most notably taking physical signature cards to the real Grunnah’s home to be signed. After further communications, Fake Robert sent Molito r an invoice for a $220,000 “Investment Project” in Hong Kong and instructed Molito r to send a wire transfer to pay it. Molitor went in person to the bank and completed a $220,000 wire transfer from Reliance’s account on Thursday, May 25, 2017. The following day, Molitor received an other request from Fake Robert for additional transfers. Molitor testified that from the outset, she had been uncomfortable with the res ponsibility of making wire tr ansfers. After consulting with Lilley, she called Grunnah to ask a bout the new request and discovered that Grunnah knew nothing about the $220,000 tran sfer. They immediately contacted the bank to attempt to stop the payment or obtai n a refund, but were not able to do so. Reliance filed a claim withCentral under the policy. Central denied Reliance’s claim by letter of July 14, 2017, stating that the policy did not cover the loss.
2. The policy Reliance purchased a commercial lines policy from Central for the 2016-17 policy year. Reliance also paid Central an additional premium for the “Central Premier Plus ® Property Extensions Coverage E ndorsement” (the “Premier Plus endorsement”). The policy includes a “Special Form” en titled “Causes of Loss” (“Causes of Loss form”). Paragraph A of this form defi nes “Covered Causes of Loss” as “direct–4– physical loss unless the loss is excluded or limited in this polic y.” Paragraph B.2.i of the Causes of Loss form provides, under “Exclusions,” “We will not pay for loss or damage caused by or resulting from any of the following: . . . Voluntary parting with any property by you or anyone else to whom you have entrusted the property if induced to do so by any fraudulent scheme, tr ick, device or false pretense.” At trial and on appeal, Central has relie d on this “Voluntary Parting” exclusion to argue that the policy does not cover Reliance’s lo ss, although its letter denying Reliance’s claim made no mention of it. The Premier Plus endorsement specifically provides that it modifies the Causes of Loss form, among other coverages. The endorsement also states that “Coverage is amended by the following cha nges to Additional C overages, Coverage Extensions, Condition[s] and Exclusions . All other Limitations, Conditions and Exclusions apply.” In paragraph A.6.b, “E xclusions,” the Premier Plus endorsement states that the listed exclusions “are adde d as respects the Crime Coverage provided by this endorsement” “[i]n addition to th e Exclusions in Causes of Loss–Special
Form.” The Premier Plus endorsement adds “C rime Coverages,” including coverages for “Forgery or Alteration,” “Computer and Funds Transfer Fraud,” and “Fraudulent Impersonation,” among others. The Premie r Plus endorsement’s “Forgery or Alteration” coverage para graph provides in part:–5– 2) a) We will pay for loss re sulting directly from “forgery” 1 or alteration of checks, drafts, prom issory notes, or similar written promises, orders or directions to pay a sum certain in “money” that are: i) Made or drawn by or drawn upon you; or ii) Made or drawn by one acting as your agent; or that are purported to ha ve been so made or drawn. “Forgery” is defined in the Premier Pl us endorsement as “the signing of the name of another person or organizati on with intent to deceive . . . .”
3. The trial Molitor and Grunnah testified at trial about the events leading to the funds transfer and Reliance’s subsequent co mmunications with Central. William R. Hamm, a claims adjuster, testified on Centra l’s behalf about Central’s denial of the claim. Hamm was responsible for investiga ting the claim, but he did not interview either Molitor or Grunnah to determine what happened. Although Reliance had contacted both the police and the FBI, Hamm did not attempt to learn the scope or result of any law enforcement investigati on. Hamm testified that he made his coverage decision based so lely on one conversation w ith Lilley and a copy of a written timeline Molitor had prepared at the time she learned of the fraud. He admitted that when he wrote the letter to Reliance denying the claim, he did not consider or mention the Voluntary Parting exclusion. He confirmed his belief that Reliance was the victim of a crime and that no one atReliance was involved in

1 Terms in quotes are define d elsewhere in the policy.–6– perpetrating the fraud. And he testified that “[ a]s we sit here today, there is a loss of $220,000.” Both parties moved for directed verdic t on the Voluntary Parting exclusion. Central argued the exclusion applied to preclude any coverage under the Premier Plus endorsement. Reliance argued the opposite, that the Voluntary Parting exclusion did not apply to any of the cove rages in the Premier Plus endorsement. The trial court denied the parties’ motio ns for directed verdict and submitted the case to the jury.
4. The verdict The trial court’s charge included 15 questions. The jury’s answers to Questions 4, 5, 6, 7, 8, and 9 are at issue in this appeal . The jury found: Question 4: Reliance suffered a loss resulting directly from “forgery,” Question 5: Reliance’s loss resulted fro m the voluntary parting with property induced by a fraudulent scheme, Question 6: Central did not fail to pay the amount owed for losses under the policy, Question 7: Not answered; the question inquired about the amount of damages resulting from Central’s failure to pay, but the jury did not answer it because it was conditioned on an affirmative finding in response to Question 6, Question 8: Central failed to comply w ith its duty of good faith and fair dealing to Reliance, and Question 9: $25,000 would fairly a nd reasonably compensate Reliance for Central’s failure to comply with its duty of good faith and fair dealing.–7– 5. The judgment Both parties moved for judgment based on the jury’s favorable findings and requested the trial court to disregard the unfavorable findings. After a hearing, the trial court rendered judgment for Reliance in the principal amount of $220,000. The trial court also awarded Reliance the $25,000 in damages f ound by the jury in response to Question 9, as well as amount s for attorney’s fees and interest. This appeal followed.
I SSUES In six issues, Central contends the tr ial court erred by (1) failing to grant Central’s motion for directed verdict; (2) di sregarding the jury’s answer to Question No. 5 that addressed the Voluntary Parting exclusion in the policy; (3) disregarding the jury’s answer to Question No. 6 that Central did not fail to pay the amount owed for losses under the insurance policy; (4) failing to render judgment for Central in accordance with the jury’s an swer to Question No. 7 awar ding no breach of contract damages; (5) failing to disregard the jury’s answer to Question No. 4, the Forgery coverage question, and (6) fa iling to disregard the jury’s answers to Question Nos. 8 and 9 regarding common la w bad faith, and rendering judgment for Reliance on those claims.
S TANDARDS OF R EVIEW In reviewing the grant or denial of a motion for directed verdict or a motion for judgment notwithstanding the verdict (JNOV), we apply the standards for assessing the legal sufficiency of the evidence. Helping Hands Home Care, Inc. v.–8– Home Health of Tarrant Cty., Inc. , 393 S.W.3d 492, 515 (Tex. App.—Dallas 2013, pet. denied) (citing City of Keller v. Wilson, 168 S.W.3d 802, 823 (Tex. 2005)). A trial court properly denies a motion for di rected verdict and a motion for JNOV if, looking at all the evidence in the light mostfavorable to the challenged fact or the jury’s finding, a reasonable tr ier of fact could have formed a firm belief or conviction that the fact or finding was true. Id. A directed verdict for a defendant may be proper when (1) a plaintiff fails to present evidence raising a fact issue essential to the plain tiff’s right to recover, or (2) if the plaintiff either admits or the ev idence conclusively esta blishes a defense to the plaintiff’s cause of action. Mauricio v. Castro , 287 S.W.3d 476, 479 (Tex. App.—Dallas 2009, no pet.). We review a trial court’ s grant of a judgment notwithstanding the verdict under a no-evidence standard, examining wh ether any evidence supports the jury’s findings. Gharda USA, Inc. v. Control Sols., Inc. , 464 S.W.3d 338, 347 (Tex. 2015).
In Gharda USA, Inc. , the supreme court explained: No evidence exists when there is: (a) a complete absence of evidence of a vital fact; (b) the court is barred by rules of law or of evidence from giving weight to the only evidence offered to prove a vital fact; (c) th e evidence offered to prove a vital fact is no more than a mere sc intilla; (d) the evidence establishes conclusively the opposite of the vital fact. More than a scintilla of evidence ex ists when the evidence supporting the finding rises to a level that would enable reasonable and fair-minded people to differ in their conclusion s. When determining whether any evidence supports a judgment, we ar e limited to reviewing only the–9– evidence tending to support the jury’s verdict and must disregard all evidence to the contrary. We view the evidence and possible inferences in the light most favorable to the verdict. If more than a scintilla of evidence supports the verdic t, it must be upheld. Id. (citations and quotation marks omitted). In Texas, insurance policies are construe d according to the ordinary rules of contract construction. Am. Mfrs. Mut. Ins. Co. v. Schaefer, 124 S.W.3d 154, 157 (Tex. 2003). In applying these rules, our prim ary concern is to ascertain the parties’ intent as expressed in th e language of the policy. Kelley–Coppedge, Inc. v. Highlands Ins. Co., 980 S.W.2d 462, 464 (Tex. 1998). If an insurance contract uses unambiguous language, we w ill construe it as a matter of law and enforce it as written. In re Deepwater Horizon , 470 S.W.3d 452, 464 (Tex. 2015); see also TIG Ins. Co. v. N. Am. Van Lines, Inc. , 170 S.W.3d 264, 268 (Tex . App.—Dallas 2005, no pet.) (“If the contract can be given an exact or certain legal interpretation, it is not ambiguous, and we must interpret the in surance policy’s meaning and intent from its four corners.”). When possible, we must harmonize all of the provisions with reference to the entire agreem ent; no single provision shoul d be read as controlling. Coker v. Coker, 650 S.W.2d 391, 393 (Tex.1983). Whether policy language is ambi guous is a question of law. Schaefer, 124 S.W.3d at 157. Ambiguity does not arise simp ly because the parties offer conflicting interpretations; rather, ambiguity exists only when the contract is susceptible of two or more reasonable interpretations. Id. Moreover, ambiguity must be evident from the policy itself; it cannot be created by introducing parol evidence of intent. Fiess–10– v. State Farm Lloyds, 202 S.W.3d 744, 747 (Tex. 2006). “If a contract of insurance is susceptible of more than one reasona ble interpretation, we must resolve the uncertainty by adopting the construction that most favors to the insured.” Nat’l Union Fire Ins. Co. of Pittsbu rgh, Pa. v. Hudson Energy Co., 811 S.W.2d 552, 555 (Tex. 1991). As the supreme court recently e xplained, “If the parties offer reasonable but conflicting interpretati ons, we adopt the constructi on that favors coverage.” Dillon Gage, Inc. of Dallas v. Certain U nderwriters at Lloyds Subscribing to Policy
No. EE1701590 , 636 S.W.3d 640, 643 (Tex. 2021).
D ISCUSSION 1. Voluntary Parting exclusion (Issues 1 and 2) Central argues that the Voluntary Parting exclusion applies and is unambiguous. Consequently, Central conte nds the trial court erred by denying its motion for directed verdict based on the exclusion, submitting the question to the jury, then disregarding the jury’s “Yes” answer to Question 5. Although a question about this exclusion was submitted to th e jury, the interpretation of the policy language is a question of law. See Tex. Farm Bureau Mut. Ins. Co. v. Sturrock , 146 S.W.3d 123, 126 (Tex. 2004) (courts constr ue unambiguous polic y language as a matter of law). A jury’s finding on a questi on of law may be deemed immaterial and disregarded. Spencer v. Eagle Star Ins. Co. of America , 876 S.W.2d 154, 157 (Tex. 1994).–11– The applicable coverage form in th e policy is the “Commercial Property Coverage Part” that includes the “Buildi ng and Personal Propert y Coverage Form” (“BPP Coverage Form”), the Causes of Loss form where the Voluntary Parting exclusion is found, and the Premier Plus endorsement that amends the policy to add “Crime Coverage,” including coverage for “Forgery or Alteration.” The express language of the exclusion is “Voluntary parting with any property by you or anyone else to whom you have entrusted the prop erty if induced to do so by any fraudulent scheme, trick, device or false pretense.” There is no specific reference to the Voluntary Parting exclusion in the Premier Plus endorsement. Instead, Central relies on general language in the Premier Plus endorsement that “All other Limita tions, Conditions and Exclusions apply.” Immediately before this language, however, the Premier Plus endorsement expressly states that it modifies the Causes of Loss form, where the Voluntary Parting exclusion is found. Citing this Court’s opinion in Mesa Operating Co. v. California Union
Insurance Co. , 986 S.W.2d 749 (Tex. App.—Dalla s 1999, pet. denied), Central argues that because the Premier Plus endorsement references the limitations, conditions, and exclusions in the “main policy,” the Voluntary Parting exclusion must be applied to the Premier Plus cove rages. As we explained in that case, however,–12– Endorsements to a policy genera lly supersede and control over conflicting printed terms within the main policy. Often, endorsements are issued to add coverages that w ould otherwise be excluded. Yet, an endorsement cannot be read apart fro m the main policy, and the added provisions will only supersede the previ ous terms to the extent they are truly in conflict. The policy and endorsement shoul d be construed together unless they are so much in conflict that they cannot be reconciled. Id. at 754 (internal citations omitted). Appl ying this analysis, we reached differing conclusions on whether two coverage provisions in an endorsement superseded exclusions in the main policy. See id. at 754–55. Where the provisions could not be reconciled, we concluded the endorsement supersededthe policy and provided
coverage. Id.
In Morris James LLP v. Continental Casualty Co. , a case cited by Reliance, the court concluded that a “False Pretense Exclusion” and a “Forgery and Alteration Endorsement”—provisions similar to the Voluntary Parting exclusion and the forgery coverage here—wer e clear and unambiguous standing alone, but were ambiguous when read together. 928 F. Su pp. 2d 816, 824–25 (D. Del. 2013). Morris James, a law firm, had been drawn into a scam involving its acceptance of a counterfeit check that it deposited in its ba nk account. It then wired the funds to a third party at the scammer’s direction See id. at 819. Morris James filed a claim with Continental under its business property in surance policy after it was unable to recover the funds. Id. Continental denied the cl aim and Morris James sued. Id. Both parties filed motions for summary judgment regarding coverage of Morris James’s claim under the policy. Id. at 818. The False Pretense Exclusion in–13– the policy provided that Continental woul d not pay for loss or damage “caused by or resulting from . . . voluntary parting with any property . . . if induced to do so by any fraudulent scheme , trick, device or false pretense.” Id. at 820. The Forgery and Alteration Endorsement pr ovided coverage “for lo ss resulting directly from ‘forgery’ or alteration of checks, drafts , promissory notes, or similar written promises, orders or directions to pay a sum certain in money . . . .” Id. After concluding that the scammer’s co unterfeit check fell within the policy’s definition of “forgery,” the court turned to the False Pretense Exclusion and found that it also applied: “Therefore, there is no serious dispute that, in addition to resulting from a forged instrument, the scam was a fraud which induced plaintiff to voluntarily part with $176,750, within the language of th e False Pretense Exclusion.” Id. at 823–24. The court then reasoned that because the loss fell within the plain meaning of both the forgery and false pret ense provisions, the question “whether the loss is covered or excluded by the Policy hi nges on which provision is interpreted to prevail, or “trump,” the other when the Policy is interpreted as a whole.” Id . at 824. The court found the policy to be ambiguous when the provisions were read together because the policy was unclear about the application of the exclusions to the coverages provided in the endorsements. See id. at 825. The court concluded that because the policy’s language was ambiguous , the policy “should be interpreted in favor of the insured because the insurer is in control of the process of articulating the terms.” Id.–14– Similarly here, we conclude that the Voluntary Parting provision’s exclusion of losses in which the insured was “induced . . . by any fraudulent scheme, trick, device or false pretense” cannot be reconc iled with the Premier Plus endorsement’s express coverage of loss fromfraud-based crimes such as forgery, defined as “the signing of the name of anothe r person or organization with intent to deceive.” The Premier Plus endorsement’s express statemen t that it modifies the Causes of Loss form (where the Voluntary Parting exclusi on is found) is follo wed only by a general statement that “[a]ll other Limitations, C onditions and Exclusions apply.” If this non-specific language is read to require exclusion of all losses induced “by any fraudulent scheme, trick, device or false pretense,” th en the crime coverages offered in the endorsement would not apply to losses from fraud-based crimes, despite the policy’s definitions of those crimes as i nvolving “intent to deceive” or “fraudulent” conduct. As in Mesa Operating Co. and Morris James , we conclude that because the Voluntary Parting provision cannot be reconciled with the Premier Plus endorsement, the Premier Plus e ndorsement’s language controls. See Mesa Operating Co. , 986 S.W.2d at 754–55; Morris James , 928 F. Supp. 2d at 822, 825; see also Dillon Gage, Inc. of Dallas , 636 S.W.3d at 643 (if pa rties offer reasonable but conflicting interpretations, court adop ts construction that favors coverage). 2 We

2 Given this conclusion, we need not consider the parties’ additional arguments regarding whether the Voluntary Parting exclusion applies to “Money” as defined in the Premier Plus endorsement. Further,–15– conclude the trial court di d not err by denying Central’s motion for directed verdict based on the Voluntary Parting exclusio n and by disregarding the jury’s “Yes” answer to Question 5 of the jury charge. See Helping Hands Home Care, Inc. , 393 S.W.3d at 515 (standard of revi ew for directed verdict); Spencer , 876 S.W.2d at 157 (standards for disregard of jury’s answer). We decide Central’s first two issues against it. 2. Forgery provision of Premi er Plus endorsement (Issue 5) Question 4 of the jury charge addresse d forgery, tracking the Premier Plus endorsement’s language: Did Reliance suffer a loss resulting di rectly from “forgery” or alteration of checks, drafts, promissory notes, or similar written promises, orders or directions to pay a sum ce rtain in “money” that are: i) Made or drawn by or drawn upon Reliance; or ii) Made or drawn by one acting as Reliance’s agent, or that are purported to have been so made or drawn. Answer “Yes” or “No”. Answer: Yes Central argues that the trial court shouldhave disregarded the jury’s answer to Question 4 because there was no evidence pr esented at trial to support it. Central contends the Premier Plus endorsement’s fo rgery coverage is limited to forgery of

because we have not construed the Voluntary Parting exclusion to preclude cove rage for any portion of Reliance’s loss, we need not address Central’ s arguments regarding concurrent causation. Cf. Dallas Nat’l Ins. Co. v. Calitex Corp. , 458 S.W.3d 210, 222–23 (Tex. App.—Dallas 2015, no pet.) (under concurrent causation doctrine, “when covered and non-covered perils combine to create a loss, the insured is entitled to recover that portion of the damage caused solely by the covered peril”).–16– negotiable instruments and did not includ e the fraudulent emails and invoices in question here. Central cites several cases from other jurisdictions in support of its argument that “a fraudulent email instructi ng the insured to wire money is not a financial instrument as required for coverage under the fo rgery coverage.” See, e.g., Midlothian Enters., Inc. v. Owners Ins. Co. , 439 F. Supp. 3d 737, 743 (E.D. Va. 2020) (email directing the insured to wire funds was not a “Covered Instrument” under the forgery or alterati on endorsement of the insu red’s policy because it was not a negotiable instrument); see also RSUI Indem. Co. v. The Lynd Co. , 466 S.W.3d 113, 118 (Tex. 2015) (“When c onstruing an insurance po licy, we are mindful of other courts’ interpretations of policy language that is identi cal or very similar to the policy language at issue.”). Reliance, in turn, relies on cases from ot her jurisdictions interpreting similar policy language and c oncluding that forgery coverage applied. See, e.g., Ad Advert. Design, Inc. v. Sentinel Ins. Co. Ltd. , 344 F. Supp. 3d 1175, 1183 (D. Mont. 2018) (four emails directing the insured to tran sfer funds to a specified account by wire transfer constituted a “direction[ ] to pay a sum certain in mone y” covered under the policy’s forgery provision ). Reliance also cites Great American Insurance Company v. AFS/IBEX Financial Services, Inc. , 612 F.3d 800 (5th Cir. 2010), in support of its argument that forgery coverage is not limited to negotiable instruments. See id. at 804–05 (giving the term “forgery” in an insurance policy its “plain, ordinary–17– meaning” rather than its interpretation in the “commercial pape r context” under the UCC). 3 As Central argues, more c ourts have reached the conc lusion that forged emails or other false wire transfer authoriza tions or instructions are not negotiable instruments and consequently ar e excluded from forgery coverage. See, e.g., Ryeco, LLC v. Selective Ins. Co. , 539 F. Supp. 3d 399, 405–08 (E.D. Pa. 2021) (collecting cases and distinguishing Ad Advertising as an “outlier”). But neither party has cited binding authority that requires us to reach either conclusion. Consequently, we turn to the policy language and consider its application to the facts before us. Here, the forgery or alte ration coverage in the Pr emier Plus endorsement includes “loss resulting directly from ‘forg ery’ or alteration of checks, drafts, promissory notes, or similar written promis es, orders or directions to pay a sum certain in ‘money’ that are . . . Made or drawn by or drawn upon you . . . .” “Forgery” is defined as “the signing of the name of another person or organization with intent to deceive,” and “signatures that ar e produced or reproduced electronically, mechanically, or by other means” are trea ted “the same as ha ndwritten signatures.” Although negotiable instruments such as ch ecks, drafts, and promissory notes are

3 But as Central points out, the same court previously held that because forged invoices “were not made, drawn by, or drawn upon [the insured] as those terms are used in the commercial paper context or under the Uniform Commercial Code,” there was no coverage under the insured’s crime policy. See Travelers Cas. & Sur. Co. of Am. v. Baptist Health Sys. , 313 F.3d 295, 299 (5th Cir. 2002) (citing Parkans Int’l LLC v. Zurich Ins. Co. , 299 F.3d 514, 517 (5th Cir. 2002)).–18– specifically included, the forgery coverage also includes “similar written promises, orders or directions to pay a sum certa in in ‘money,’” and the provision does not include the word “negotiabl e.” We conclude that this language is broad enough to encompass the fraudulent emails and wire tr ansfer instructions directing Molitor to pay the $220,000 to a specific party in Hong Kong. See In re Deepwater Horizon , 470 S.W.3d at 464 (court gives insurance polic y’s words their ordinary and generally accepted meaning unless the policy indicates the parties intended the language to impart a technical or different meaning). In sum, evidence admitted at trial show ed that an unknown party with intent to deceive used Grunnah’s email address a nd signature block to order or direct Molitor to pay a sum certain in money by wi re transfer, a “loss resulting directly from ‘forgery’” as defined in the policy. Consequently, we conclude there was evidence to support the jury’s answer to Qu estion 4, and the trial court did not err by denying Central’s motion to disregard it. We decide Central’s fifth issue against it. 3. Findings on amount owed for losses (Issues 3 and 4) Central’s third and fourth issues addr ess Questions 6 and 7 of the jury’s verdict. In response to Question 6, the ju ry answered “no,” finding that Central did not fail to pay the amount owed for losses under the insurance policy. Question 7, inquiring about damages for Central’s fa ilure to pay, was dependent on a “yes” answer to Question 6. The ju ry followed the instruction and did not answer Question 7. Central argues that the trial court co mmitted reversible error by disregarding the–19– jury’s “no” answer to Question 6 and by failing to render judgment in Central’s favor when the jury did not award Reliance a ny damages in response to Question 7. “‘A trial court may disregard a jury finding only if it is unsupported by evidence . . . or if th e issue is immaterial.’” USAA Tex. Lloyds Co. v. Menchaca , 545 S.W.3d 479, 505 (Tex. 2018) (quoting Spencer , 876 S.W.2d at 157). A jury answer is immaterial when the question should not have been submitted, or when it was properly submitted but has been rende red immaterial by other findings. Id. at 506. Further, “[t]he trial court need not su bmit jury questions on undisputed facts.” European Crossroads’ Shopping Ctr., Ltd. v. Criswell , 910 S.W.2d 45, 56 (Tex. App.—Dallas 1995, writ denied); see also Menchaca , 545 S.W.3d at 501 (“A breach-of-contract claim can involve any one or more of numerous discrete issues, but the jury need only be asked and in structed about those the parties actually dispute, and on which the pleadings and evid ence actually raise an issue.” [internal quotation omitted]). Central argues that the breach of c ontract question was properly submitted because of the numerous factual disputes that the jury was asked to resolve, including application of two other crime c overages to the loss. But the trial court’s judgment rests on the jury’s finding in response to Question 4—that Reliance suffered a loss resulting directly from forg ery—establishing Central’s liability under the policy despite the jury’s resolution of factual disputes in Central’s favor on other–20– coverages. Consequently, even if Ques tion 6 was properly s ubmitted, the answer was rendered immaterial by the jury’s affirmative answer to Question 4. Because we have conclude d that Reliance’s loss was covered under Central’s policy and because both the amount of the loss and Central’s failure to pay it are undisputed, 4 we conclude the trial court did not err by disregarding the jury’s answer to Question 6 or by rendering judgment for Reliance in the amount of its loss. We decide Central’s sixth and seventh issues against it. 4. Damages for bad faith (Issue 6) In its sixth issue, Central argues the tria l court erred by failing to disregard the jury’s answers to Questions 8 and 9, the common law bad faith questions, and awarding Reliance judgment for the $25,000 found by the jury in response to Question 9. Central contends that under Menchaca , “an insured may not recover any extracontractual damages if the insured is not entitled to any benefits under the insurance policy.” See Menchaca , 545 S.W.3d at 490 (stating the “general rule . . . that an insured cannot recover policy benefits for an insurer’s statutory violation if the insured does not have a right to those be nefits under the polic y”). But because we have concluded that the trial court correc tly awarded policy bene fits to Reliance,

4 Central contends the amount of Reliance’s loss w as not established as a matter of law because “some of the funds transferred by Molitor belonged to th ird parties, not Reliance.” There was no evidence, however, that the transferred funds were not in Relia nce’s control or that any party other than Reliance suffered any portion of the loss. In sum, Reliance pl eaded and offered proof that it suffered damages of $220,000 as a result of the fraud.–21– Menchaca ’s holding does not preclude recovery of extra-contractual damages in this

case. We also conclude there was evidence to support the jury’s “yes” answer to Question 8. In Question 8, the jury was inst ructed that “[a]n insurer fails to comply with its duty of good fa ith and fair dealing by”:

 Failing to attempt in good faith to effectuate a prompt, fair, and equitable settlement of a claim when the in surer’s liability has become reasonably clear or
 Refusing to pay a claim w ithout conducting a reasonable investigation of the claim or
 Canceling an insurance policy without a reasonable basis. Reliance offered evidence thatCentral failed to interv iew Molitor and Grunnah, did not attempt to learn the scope or result of any law enforcement investigation, based its coverage decision on limited informa tion, and gave Reliance inconsistent information about the basis for its denial . Further, Central did not rely on the Voluntary Parting exclusion as a reason for denying the claim. 5 This is some evidence to support the jury’s finding in response to Question 8. See Tanner v.

5 Central cites Republic Insurance Co. v. Stoker , 903 S.W.2d 338, 341 (Tex. 1995), for the proposition that an insurer is not precluded from defending a clai m based on a reason that was not given for denying the claim. In Stoker , the court described the dispositive questi on as “whether, based upon the facts existing at the time of the denial, a reasonable insurer would have denied the claim.” Id. at 340. Here, in determining the dispositive question under Stoker , the jury could consider Central’s conduct in denying the claim based on one set of reasons but defending the lawsuit based on a new and different reason. We also note that in Stoker , in contrast to this case, the plaintiffs’ claims were not covered by the policy. See id.–22– Nationwide Mut. Fire Ins. Co. , 289 S.W.3d 828, 830 (Tex . 2009) (“We will uphold a jury’s finding if more than a scintilla of competent evidence supports it.”). We agree with Central, however, that Reliance did not offer any evidence to support the jury’s $25,000 damage award. “A claim for bad-faith conduct that breaches the common-law duty can potentially result in three types of damages: (1) benefit of the bargain damages for an accompanying breach of contract claim, (2) compensatory damages for the tort of bad faith, and (3) punitive damages for intentional, malicious, fraudulent, or grossly negligent conduct.” Menchaca , 545 S.W.3d at 488 n.11 (internal quota tions and citations omitted). Citing evidence of “Central’s complete lack of investigation, in addition to its everchanging reasons for denying coverage ,” Reliance offers two possible grounds for the jury’s award: (1) “to compensa te Reliance for the time and expense it incurred trying to force Central to investig ate its claim” and (2) “for the mental anguish Debbie Molitor, Reliance’s prim ary employee, suffered as a result of Central’s denial of Reliance’s clai m without conducting any meaningful investigation.” But Reliance did not offe r any evidence to support an amount of damages for either of these grounds, and in any event, Molitor is not a plaintiff in this case and did not assert a cause of ac tion against Central for damages. Further, the trial court awarded attorney’s fees to Reliance in addition to the jury’s award of bad faith damages, compen sating Reliance for the time and expense incurred by its attorneys in pursuing its claim at trial and on appeal.–23– We conclude there is no evidence to s upport the jury’s award of $25,000 in response to Question 9. Consequently, we sustain Central’s sixth issue and reverse the portion of the judgment awarding Reliance $25,000 in damages for Central’s failure to comply with its duty of good faith and fair dealing.
C ONCLUSION We reverse the portion of the j udgment awarding Reliance $25,000 in damages for Central’s failure to comply w ith its duty of good faith and fair dealing. In all other respects, the trial court’s judgment is affirmed.

210071F.P05 /Robert D. Burns, III / ROBERT D. BURNS, III CHIEF JUSTICE–24– 

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Court of Appeals Fifth District of Texas at Dallas JUDGMENT

CENTRAL MUTUAL INSURANCE COMPANY, Appellant

No. 05-21-00071-CV V.

RELIANCE PROPERTY MANAGEMENT, INC., Appellee On Appeal from the 44th Judicial District Court, Dallas County, Texas Trial Court Cause No. DC-18-00856. Opinion delivered by Chief JusticeBurns. Justices Schenck and PartidaKipness participating.

In accordance with this Court’s opinion of this date, the judgment of the trial court is AFFIRMED in part and REVERSED in part. We REVERSE the award of $25,000 in damage s to appellee Reliance Property Management, In c. in paragraph 2 of the trial court’s judgment. Judgment is RENDERED that appellee Reliance Property Management, Inc. take nothing on its claim for breach of the duty of good faith and fair dealing. In all other re spects, the trial court’s judgment is AFFIRMED

. It is ORDERED that appellee Reliance Propert y Management, Inc. recover its costs of this appeal and the amount of the judgment as affirmed from appellant Central Mutual Insurance Company and from the cash deposit in lieu of cost bond. After all costs have been paid , the clerk of the Dallas court is directed to release the balance, if any, of the cash deposit to Central Mutual Insurance Company.

Judgment entered May 25, 2022