Opinion ID: 1223790
Heading Depth: 1
Heading Rank: 3

Heading: USAA's Action in Tort for Fraud Entitled It to Seek Damages to Compensate for Expenses it Incurred in Investigating the Fire and Paying the Mortgage Holder.

Text: ¶ 11 In addition to denying the claim for fire loss, USAA filed this action to recover sums it expended in investigating the fire and in paying the mortgage holder. USAA's action was a tort action for fraud. It was not based on the contract provision which allows USAA to deny the claim in cases of concealment or fraud. Specifically, the fraud action was based on false statements concerning the cause of the fire and on claims Husband submitted to USAA which it claimed were inflated, false, and a misrepresentation of the true amount of damage. The jury found for USAA in its fraud action. ¶ 12 The Court of Civil Appeals has failed to appreciate that USAA did not file this lawsuit in order to deny the claim for policy benefits, contract provisions allowed it to do so. It is therefore irrelevant whether the insurance contract provided for recovery of investigation expenses and payment to the mortgage holder. USAA filed this action for fraud to recover damages it suffered as a result of the fire. These damages were incurred because coverage was sought for losses from an accidental fire which was actually intentionally set. ¶ 13 Husband and Wife urge that USAA may not bring a fraud action to recover its investigative expenses and mortgage payment to the loss payee. They argue that to allow such an action would violate public policy and that USAA should only be allowed to defend the contract counterclaim brought against if for policy benefits. ¶ 14 This Court knows of no statement of public policy from which that conclusion can be found or inferred. In fact, article 2, section 6, of the Oklahoma Constitution requires that a speedy and certain remedy [be] afforded for every wrong and for every injury to person, property, or reputation. Further, title 23, section 3, of the Oklahoma Statutes provides that [a]ny person who suffers detriment from the unlawful act or omission of another, may recover from the person in fault a compensation therefor in money, which is called damages. Section 4 of title 23 defines detriment as a loss or harm suffered in person or property. Finally, in Oklahoma it is a criminal offense to present a fraudulent claim to an insurer. [1] A civil cause of action for fraud can reasonably be inferred from that provision. ¶ 15 Although research reveals no Oklahoma decision in which a fraud action brought by an insurer has been challenged, [i]t will be assumed in an action for fraud to recover back money paid, on the ground that the insured burned the property, that the insurer, in paying the insurance, relied as it had the right to do upon statements in the proof of loss that the fire was of unknown origin and that it was not caused by the act or procurement of the insured. 18 Couch on Insurance § 74:159 (citing Hanover Fire Insurance Co. v. Furkas, 267 Mich. 14, 255 N.W. 381 (1934)). USAA's reliance on Husband and Wife's repeated assertions that the fire was accidental caused detriment to USAA. It therefore had the right to seek damages to compensate for its losses. The trial court did not err in submitting the insurer's action for damages to the jury.