Opinion ID: 32725
Heading Depth: 3
Heading Rank: 2

Heading: analysis

Text: In its second motion for summary judgment, General argued that Compass lacked standing to bring a claim for breach of contract, that Compass could not establish any rights under the Policy, and that Compass could not show the existence of a 6 triable issue about whether the conditions precedent to coverage had been met. The district court granted summary judgment based on Compass's failure to put forth any evidence that either it or Esco had complied with the Policy's provisions for establishing loss. Under Texas law, the insured bears the burden of establishing that a claimed loss falls within the terms of the policy. See Western Alliance Ins. Co. v. Northern Ins. Co., 176 F.3d 825, 831 (5th Cir. 1999); Employers Cas. Co. v. Block, 744 S.W.2d 940, 944 (Tex. 1988), overruled on other grounds by State Farm Fire & Cas. v. Gandy, 925 S.W.2d 696 (Tex.1996). General contends that summary judgment was warranted because Compass did not establish the existence of a covered loss under the Policy. The Policy provided that General would cover the insured's legal liability for third-party loss in accordance with the Tariff, Bill of Lading or Shipping Receipt. The record contains no evidence of any tariff, bill of lading, shipping receipt, or other document showing Esco's legal liability, the value of the cargo, or the owner of the cargo. Compass conceded that Esco has not reimbursed Sam's Wholesale Club for the value of the cargo. When Esco filed its complaint, it asserted that cargo valued at $372,088.80 was stolen, and Esco therefore was required to reimburse Sam's Wholesale Club for the stolen cargo. Esco also submitted an affidavit of an Esco employee with its motion for 7 partial summary judgment that conclusorily asserted that Esco was required to reimburse Sam's Wholesale Club for the value of the cargo, without establishing the basis for Esco's liability to Sam's Wholesale Club. The record contains nothing of evidentiary value on the issue of Esco's legal liability, much less evidence establishing Esco's legal liability in accordance with the Tariff, Bill of Lading or Shipping Receipt. Compass disputes General's representation of the record, stating that it supplied General with a bill of lading and a claim from the cargo owner, but as the district court noted, the record does not contain any such evidence. As a result, Compass has failed to establish a genuine issue of material fact with respect to Esco's legal liability, and thus whether there was a covered cause of loss under the Policy. General was therefore entitled to summary judgment. Although Compass quarrels with the district court's conclusion that the insured had to meet one of the three conditions listed in the Loss Payment provision to establish liability, we note that Compass failed to establish Esco's legal liability by any means. The district court emphasized the absence of any evidence that Esco was indeed liable to Sam's Wholesale Club in its denial of plaintiff's motion for a new trial. The Policy covers only legal liability, and we affirm the district court's conclusion that Compass never established the existence of Esco's legal liability under the Policy. As a 8 result, we also need not reach the issue of whether the loss is excluded from coverage under the Unattended Trailer Exclusion. Compass argues that when General initially denied coverage to Esco based on the Unattended Trailer Exclusion, it waived any other defenses to coverage. Compass relies on Lancon v. Employers Nat'l Life Ins. Co., 424 S.W.2d 321 (Tex. Civ. App. - Houston [1st Dist.] 1968); Scott v. Indus. Life Ins., 411 S.W.2d 769 (Tex. Civ. App. - Dallas 1967); and Am. Employers Inc. Co. v. El Paso Val Cotton, 392 S.W.2d 569 (Tex.Civ.App.-El Paso 1965). As the court stated in Lancon, when one specific ground of forfeiture is urged against a policy of insurance, and the validity thereof denied on that ground alone, all other grounds are waived. 424 S.W.2d at 323. In its initial letter denying coverage, General did not rely on the single ground alone and instead specifically reserved all rights, privileges, and defenses under the Policy. Further, when General answered Esco's claims, it promptly asserted affirmative defenses and alleged that conditions precedent to recovery under the Policy had not been met. Because General did not deny Esco's claim on the Unattended Trailer Exclusion ground alone, we affirm the district court's finding that General did not waive all other defenses under the Policy.