Opinion
01-23-00401-CV
11-14-2023
IN RE HOMEOWNERS OF AMERICA INSURANCE COMPANY, Relator
Panel consists of Justices Goodman, Landau, and Rivas-Molloy.
MEMORANDUM OPINION
PER CURIAM
Relator Homeowners of America Insurance Company filed a petition for writ of mandamus requesting we order Respondent, Hon. C. Elliott Thornton, to vacate her order of January 20, 2023 denying Relator's plea in abatement, (2)render a new order compelling Real Parties in Interest Rebecca Cantu and Miguel Cantu "to participate in an appraisal and abating the lawsuit until the appraisal is completed," and (3) vacate her order of May 3, 2023 granting Real Parties' motion to compel production of documents. We denied Relator's petition on June 13, 2023.
The underlying case is Rebecca Cantu and Miguel Cantu v. Homeowners of America Insurance Company, Cause No. 2022-72302, pending in the 164th District Court of Harris County, Texas, the Honorable C. Elliott Thornton presiding.
Relator filed a motion for rehearing requesting we vacate our opinion and issue an order granting the relief requested in its petition for writ of mandamus. We withdraw our June 13, 2023 opinion and issue this opinion in its stead. Our disposition remains the same.
We deny Relator's motion for rehearing.
Relator also filed a motion for en banc reconsideration. Because we issue a new opinion, the motion for en banc reconsideration is moot. In re Wagner, 560 S.W.3d 311, 312 (Tex. App.-Houston [1st Dist.] 2018, orig. proceeding) ("Because we issue a new opinion in connection with denial of rehearing, the motion for en banc reconsideration is rendered moot."); see also Poland v. Ott, 278 S.W.3d 39, 41 (Tex. App.-Houston [1st Dist.] 2008, pet. denied) (noting that motion for en banc reconsideration rendered moot by withdrawal and reissuance of opinion and judgment); Brookshire Bros., Inc. v. Smith, 176 S.W.3d 30, 40 n.4 (Tex. App.- Houston [1st Dist.] 2004, pet. denied) (supp. op. on reh'g) (noting that motion for en banc reconsideration moot when motion for rehearing granted and new opinion and judgment issue).
Background
Real Parties Rebecca Cantu and Miguel Cantu secured an insurance policy ("Policy") from Relator Homeowners of American Insurance Company for their real property in Houston, Texas. In May 2022, Real Parties reported to Relator that their property had sustained extensive damage from a leaking water manifold. Relator assigned a representative to inspect the property and adjust the claim. Dissatisfied with the estimates they received, Real Parties filed suit against Relator for breach of contract, common law bad faith, violations of the Texas Insurance Code, and violations of the Texas Deceptive Trade Practices Act.
Relator filed an answer and a plea in abatement requesting that the trial court abate the lawsuit to allow an appraisal to move forward. Relator argued that under the terms of the Policy, an appraisal concerning the amount of a loss payment must be completed as a condition precedent to filing suit against Relator. Relator attached the Policy to its answer.
Relevant to Relator's plea in abatement and the present petition, Section E of the Policy, titled "Appraisal," provides that if the parties fail "to agree on the amount of loss, either [party] may demand an appraisal of the loss." Section G of the Policy, titled "Suit Against Us," provides that "[n]o suit can be brought unless the policy provisions have been complied with." Section G further provides:
Before you file or proceed with a suit or action against us concerning the amount of a loss payment:
a. You must provide us with written notice of your dispute, and a copy of all existing repair bids, estimates, invoices, receipts, expense records, inventories, and photos that relate to the dispute;
b. You must make a written demand to us for appraisal of the amount of loss. . . .; and
c. The appraisal must be completed . . . ."
These conditions precedent to suit or action may be waived only by a written agreement signed by you and us. If suit is filed prior to compliance with these conditions precedent, the parties agree to abatement of the lawsuit until these conditions precedent are fulfilled.
Even though Relator requested in its plea in abatement that the case be abated to allow an appraisal to move forward, Relator did not move to compel an appraisal.
Relator set its plea in abatement for written submission on December 19, 2022. Real Parties contested the plea arguing Relator had done nothing to initiate the appraisal process and even if an appraisal were conducted, it would "only settle the amount of actual damages" and the claims before the court would remain. Real Parties argued that an appraisal "would be a waste of resources" and even if an appraisal were invoked, abatement of the case was unnecessary.
Respondent denied Relator's plea in abatement on January 20, 2023. On February 1, 2023, Relator moved for reconsideration of the trial court's order. Following a hearing on May 3, 2023, Respondent denied the request for reconsideration. Also on May 3, 2023, Respondent heard argument on Real Parties' motion to compel discovery. Real Parties sought to compel proper responses to various requests for production and interrogatories served on Relator. Respondent signed an order granting Real Parties' motion to compel responses to its request for production but denying Real Parties' motion to compel interrogatory responses. The trial court gave Relator thirty days from the signing of the order, or until June 2, 2023, to comply with Real Parties' request for production of documents.
In its Petition for Writ of Mandamus, Relator argues it "has no adequate remedy by appeal to correct the trial court's abuse of discretion in denying its right to an appraisal, refusing to abate the suit pending appraisal, and ordering [it] to respond to [Real Parties'] discovery requests." It requests that we issue an order (1) vacating the trial court's order denying Relator's plea in abatement, (2) render a new order compelling Real Parties "to participate in an appraisal and abating the lawsuit until the appraisal is completed," and (3) vacate Respondent's order granting Real Parties' motion to compel production of documents.
Analysis
Mandamus is an extraordinary remedy, available only when a relator can establish both that (1) the trial court clearly abused its discretion or violated a duty imposed by law, and (2) there is no adequate remedy on appeal. In re CSX Corp., 124 S.W.3d 149, 151 (Tex. 2003) (orig. proceeding) (citing Walker v. Packer, 827 S.W.2d 833, 839 (Tex. 1992) (orig. proceeding)). Relator has not established it lacks an adequate remedy on appeal.
A. Motion to Abate
Relator first argues the trial court abused its discretion because it denied "both [its] right to an appraisal and abatement despite the parties' express agreement to both in the Policy." Because we conclude the trial court did not deny Relator's right to appraisal, and Relator cannot establish it lacks an adequate remedy by appeal for the trial court's denial of its plea in abatement, Relator is not entitled to the relief it seeks.
"Appraisal clauses, a common component of insurance contracts, spell out how parties will resolve disputes concerning a property's value or the amount of a covered loss." In re Universal Underwriters of Texas Ins. Co., 345 S.W.3d 404, 406 (Tex. 2011) (orig. proceeding). "Appraisals can provide a less expensive, more efficient alternative to litigation" and generally should "go forward without preemptive intervention by the courts." Id. at 407 (quoting State Farm Lloyds v. Johnson, 290 S.W.3d 886, 888 (Tex. 2009)). While "mandamus relief is appropriate to enforce an appraisal clause because denial of an appraisal vitiates the insurer's right to defend [a] breach of contract claim," a "trial court's failure to grant [a] motion to abate is not subject to mandamus, and the proceedings need not be abated while the appraisal goes forward." Id. at 412, 413 n.5 (citing In re Allstate Cnty. Mut. Ins. Co., 85 S.W.3d 193, 196 (Tex. 2002) (orig. proceeding)).
There is no indication in the record that the trial court denied Relator's right to an appraisal. While Relator moved to abate the proceedings to allow an appraisal process to move forward, Relator did not move to compel the appraisal. In its plea in abatement, Relator requested only that the trial court "legally and contractually abate this case pending completion of the appraisal process." The trial court denied the plea in a written order stating: "The Plea in Abatement is DENIED. The case will not be abated and the parties will proceed with litigation." The trial court's order thus denied Relator's request for abatement and not, as Relator contends, its right of appraisal.
The same is true of Relator's motion for reconsideration, in which Relator requested only that the trial court reconsider its decision and issue an order abating the proceedings to allow the appraisal process to move forward. The trial court did not deny Relator's right to an appraisal because Relator never requested an order from the court ordering the parties to get an appraisal either in its plea or in its Motion for Reconsideration. For that reason, we cannot, as Relator requests, issue an order compelling Real Parties "to participate in an appraisal and abating the lawsuit until the appraisal is completed." Until the relief requested has been presented to the trial court and denied, the issue is not properly before us on mandamus. See In re Khanduja, No. 01-20-00041-CV, 2020 WL 543418, at *1 (Tex. App.-Houston [1st Dist.] Feb. 4, 2020, orig. proceeding) (holding "[e]quity generally is not served by issuing an extraordinary writ against a trial court judge on a ground that was never presented in the trial court and that the trial judge thus had no opportunity to address") (citation omitted).
Because Relator's right to an appraisal process has not been denied, and a trial court's failure to abate the proceedings pending an appraisal process is not subject to mandamus, Relator is not entitled to the relief requested. We find In re Cypress Texas Lloyds instructive. 425 S.W.3d 444, 447-48 (Tex. App.-Houston [1st Dist.] 2011, orig. proceeding). In that case, the trial court granted the insurer's motion to compel an appraisal but denied the insurer's motion to abate the lawsuit pending the appraisal. The insurer filed a petition for writ of mandamus challenging the trial court's order denying its motion to abate. Because the trial court had not denied Relator's attempt to enforce the appraisal process, but merely had denied the request to abate the proceedings pending such process, the court denied the insurer's petition for mandamus relief. Id. at 445, 447 (holding "trial court's denial of [a] motion to abate pending an appraisal is not subject to mandamus").
Relator attempts to distinguish In re Cypress Texas Lloyds by arguing that here, the Policy "contains an express agreement to abate any lawsuit until appraisal is completed," while the policy in In re Cypress Texas Lloyds only "required appraisal as a prerequisite to suit without any express agreement to abate the suit until an appraisal was completed." But the question remains whether Relator can establish that it lacks an adequate remedy by appeal for the trial court's failure to order abatement. That is, even when there is an abuse of discretion, Relator must establish it lacks an adequate remedy by appeal. Relator has not established this necessary element of its petition. See In re Universal Underwriters of Texas Ins. Co., 345 S.W.3d at 407 ("While the trial court's denial of the motion to invoke appraisal was error, the failure to grant the motion to abate is not subject to mandamus.").
B. Discovery Order
Relator also challenges the trial court's May 3, 2023 discovery order arguing that "discovery request served while a case is abated or when it should be abated are a legal nullity." Relator argues that because the lawsuit must be abated pending an appraisal process, the trial court abused its discretion in ordering discovery. Relator thus requests we vacate the trial court's order based on its argument that mandamus must issue for the trial court's denial of its plea in abatement. Because we conclude Relator is not entitled to mandamus relief from the court's order denying its plea in abatement, we also deny Relator's petition as it concerns the trial court's discovery order.