Court Opinion

ID: 9449436
Source: CourtListenerOpinion
Date Created: 2023-08-04 16:12:10.579991+00
Date Added: 2024-06-11T17:31:50.159654
License: Public Domain

JOHN R. BROWN, Circuit Judge
(concurring specially).
I concur in the opinion and the disposition. But if this approach is wrong, then most certainly the judgment in any event would have to be reversed. The Texas statute of limitations as to when a suit for damages may be brought by an assured against his insurer for admitted negligence in failing prudently to settle within policy limits has nothing at all to do with the obligations owed by the insurer to the assured. Long before the expiration of the period in which to bring a damage suit for negligent failure to settle, the hapless, helpless assured would have a whole arsenal of effective weapons to bring the negligent insurer to the performance of its obligations. These would include declaratory judgments, third party complaints, or the like. See Smoot v. State Farm Mutual Auto. Ins. Co., 5 Cir., 1962, 299 F.2d 525; American Fidelity & Casualty Co. v. Pennsylvania Threshermen & Farmers’ Mutual Casualty Ins. Co., 5 Cir., 1960, 280 F.2d 453; Travelers Ins. Co. v. Busy Electric Co., 5 Cir., 1961, 294 F.2d 139. These were valuable existing rights which belonged to the Assured and to which the Trustee succeeded. Any other result would be to allow an insurer to default, drive its assured to the wall of bankruptcy, and then blithely advise the estate, the trustee, the assured and all of the creditors that while its duty was breached, there is nothing to be done about it. A statute of limitations as an instrument to prevent fraud can not be ridden that far or that hard. If — and the if is a very tiny one — any other state would countenance such result, I am confident that Texas — whose laws exert an Erie control on us as to this aspect of the case — would not.