Court Opinion

ID: 2896055
Source: CourtListenerOpinion
Date Created: 2015-09-08 00:05:21.096972+00
Date Added: 2024-06-11T13:31:26.136300
License: Public Domain

NO. 07-05-0014-CV

IN THE COURT OF APPEALS

FOR THE SEVENTH DISTRICT OF TEXAS

AT AMARILLO

PANEL E

FEBRUARY 7, 2007

______________________________

MID-CENTURY INS. CO. OF TEXAS, APPELLANT

V.

CAROLE DANIEL AND STAN DANIEL, APPELLEES

_________________________________

FROM THE 72ND DISTRICT COURT OF LUBBOCK COUNTY;

NO. 2001-513,596; HONORABLE BLAIR CHERRY, JUDGE

OPINION ON MOTION FOR REHEARING
_____________________________

Before CAMPBELL, J. and REAVIS, and BOYD, S.JJ. (1)

	Following our original opinion issued November 28, 2006, by which we reversed the
judgment of the trial court and rendered judgment that Carole Daniel and Stan Daniel take
nothing against Mid-Century Ins. Co. of Texas, the Supreme Court issued its opinion in
Brainard v. Trinity Universal Ins. Co., 50 Tex. Sup. Ct. J. 271, 2006 WL 3751572 (Tex.
2006).  We overrule the Daniels' motion for rehearing, but withdraw our opinion and
judgment of November 28, 2006, and issue this opinion in lieu thereof. 
	Presenting three issues, Mid-Century Ins. Co. of Texas contends the trial court erred
in rendering summary judgment that Carole Daniel and Stan Daniel recover $70,897.60
for interest and attorney's fees for damages based on their underinsured motorist (UIM)
claim.  By three cross-points, the Daniels contend the trial court erred (1) in not enforcing
its order of July 2, 2003, to compel the production of Mid-Century's claim file, (2) in failing
to order the deposition of Mid-Century's claim representative, and (3) because there is no
basis to support Mid-Century's motions for summary judgment on the article 21.55 claim. 
We reverse the judgment of the trial court and render judgment that the Daniels take
nothing against Mid-Century.
	On April 23, 1999, Carole Daniel was injured in an automobile accident with another
car driven by Melvin Bray.  On April 20, 2001, Carole Daniel and her husband, Stan Daniel,
filed suit against Melvin Bray and also joined Mid-Century as a defendant.  The claim as
to Mid-Century was severed and abated on April 20, 2002.  The Daniels amended their
petition against Mid-Century on September 10, 2002, alleging claims under articles 21.21
and 21.55 of the Texas Insurance Code.  Upon a non-jury trial which concluded on
November 13, 2002, the trial court apportioned negligence at eighty percent for Bray and
twenty percent for the Daniels.  Also, it awarded the Daniels damages in the amount of
$94,453.55, reduced by twenty percent netting the damages at $75,562.55.  After
deducting $25,000 paid by State Farm, on November 15, 2002, Mid-Century tendered
$50,562.55 out of the underinsured motorist policy limits contained in the Daniels' policy
and the payment was accepted by them.  After Mid-Century filed its motion for summary
judgment on the extra-contractual action, on July 2, 2003, the trial court granted the motion
as to the Daniels'article 21.21 claims, and held that Mid-Century did not violate its duty of
good faith and fair dealing, (2) but denied Mid-Century's no-evidence motion as to the article
21.55 claims presented by the Daniels.  When Mid-Century filed its second motion for
summary judgment on the article 21.55 claims, the Daniels filed their cross-motion for
summary judgment.  By order signed December 22, 2004, the trial court denied the second
motion for summary judgment of Mid-Century and granted the Daniels' cross-motion and
awarded damages and attorney's fees.  The order further provided that all other relief not
granted was denied.                 
Standard of Review
	In reviewing a summary judgment, this Court must apply the standards established
in Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 (Tex. 1985), which are:
	1.  The movant for summary judgment has the burden of showing that there
is no genuine issue of material fact and that it is entitled to judgment as a
matter of law.

	2.  In deciding whether there is a disputed material fact issue precluding
summary judgment, evidence favorable to the non-movant will be taken as
true.

	3.  Every reasonable inference must be indulged in favor of the non-movant
and any doubts resolved in its favor.
 
	When both parties move for summary judgment, each party must conclusively
establish it is entitled to judgment as a matter of law, and neither party can prevail simply
by the other party's failure to discharge its burden.  Guynes v. Galveston County, 861
S.W.2d 861, 862 (Tex. 1993); Tigner v. First Nat'l Bank of Angleton, 153 Tex. 69, 264
S.W.2d 85, 87 (Tex. 1954).  If the trial court grants one summary judgment and denies the
other, the appellate court may render the judgment the trial court should have rendered. 
Jones v. Strauss, 745 S.W.2d 898, 900 (Tex. 1988).
The Daniels' Cross-Points

	Before we commence our analysis of Mid-Century's issues, we first address cross-points one and two by which the Daniels seek to alter the judgment of the trial court.  A
party who seeks relief not granted by the judgment of the trial court must file a notice of
appeal.  Tex. R. App. P. 25.1(c).  Because the record before us does not include a notice
of appeal by the Daniels, the two cross-points are dismissed. (3) See City of San Antonio v.
Hernandez, 53 S.W.3d 404, 407 (Tex.App.-San Antonio 2001, pet. denied); Quimby v.
Tex. Dep't of Transp., 10 S.W.3d 778, 781 (Tex.App.-Austin 2000, pet. denied),
	By its first issue, Mid-Century contends that a UIM motorist claim under article
21.55 (4) does not arise until a judgment has been rendered against the tortfeasor.  The
Daniels contend there is no basis to support Mid-Century's motion for summary judgment
on their article 21.55 claim.  We will consider these two questions together.  
	As grounds for their motion for summary judgment, the Daniels alleged they were
entitled to summary judgment because Mid-Century had violated article 21.55.  As grounds
for its motion for summary judgment, Mid-Century contended that article 21.55 does not
apply to the Daniels' claims because (1) it had no duty or obligation to pay pursuant to the
UIM portion of the policy until such time as it was judicially determined that the insured was
legally entitled to recover UIM benefits, and (2) it made prompt payment within two days
of the date of determination of the net amount of the claim.  For purposes of clarity, we will 
consider the award of attorney's fees and then consider the award of interest.
Attorney's Fees  
	In Brainard, the Supreme Court observed that unlike many first-party insurance 
contracts, the UIM contract is unique because, according to its terms, benefits are
conditioned upon the insured's legal entitlement to receive damages from a third party. 
Brainard, 2006 WL 3751572, at *9.  Noting that Trinity's obligation to pay benefits did not
arise until liability and damages were determined, the Supreme Court held the award of
attorney's fees by the trial court was error.  Id.  Similarly, Mid-Century's payment of
$50,562.55 within two days of the judgment against the third party precludes the award of
attorney's fees under article 21.55, §§ 4 and 6 or § 38.002(3) of the Texas Civil Practice
& Remedies Code. (5)  Following Brainard, we hold the trial court erred in rendering judgment
that the Daniels recover $55,450 as attorney's fees.
Interest
	By its judgment, the trial court also awarded interest at 18 percent on the
$50,562.55 from May 3, 2001 to November 15, 2002, in the amount of $13,987.54, plus
pre-judgment interest on $13,987.54.  Pre-judgment interest was allowed according to the
decision in Brainard because, in a wrongful death case, pre-judgment interest is authorized
by section 304.104 of the Texas Finance Code; however, the Daniels' motion for summary
judgment was not based on this provision.  Id. at *6-7.
	Section 3 of article 21.55 of the Prompt Payment of Claims Act requires the
payment of a claim not later than 15 business days after the insurer receives the
information necessary to secure final proof of loss.  Failure to timely pay the claim subjects
the insurance carrier to damages including 18 percent interest and attorney's fees per
section 6.  The Daniels' damages recoverable as to Bray were fixed at $95,453.55 at the
non-jury trial on November 13, 2002.  Following that determination, Mid-Century promptly
paid the Daniels the amount of $50,562.55 on November 15, 2002.  
	Accordingly, the trial court erred in granting the Daniels' motion for summary
judgment.  Mid-Century's first issue is sustained and the Daniels' third issue is overruled. 
Following Jones v. Strauss, 745 S.W.2d 898, 900 (Tex. 1988), we reverse the judgment
of the trial court and render judgment that the Daniels take nothing by their action and that
Mid-Century be discharged with its costs.  Mid-Century's request that it recover attorney's
fees in responding to the motion for rehearing is denied.

	Don H. Reavis

							Senior Justice

Campbell, J., concurring.
1. John T. Boyd, Chief Justice (Ret.), and Don H. Reavis, Justice (Ret.) Seventh Court
of Appeals, both sitting by assignment.
2. The Daniels did not file a notice of appeal regarding the denial of their claims under
article 21.21.
3. By letter of April 28, 2005, we notified the Daniels that their cross-points would not
be considered.  See Tex. R. App.25.1(c), 26.1(d).
4. See current version at Tex. Ins. Code Ann. §§ 542.051-.061 (Vernon Supp. 2006).
5. Daniels did not designate this statute as a ground to recover attorney's fees in their
motion for summary judgment.