Becky Broussard and Joseph Broussard v. Texas Farm Bureau Underwriters ( 2015 )

Affirmed and Memorandum Opinion filed June 4, 2014.
In The
Fourteenth Court of Appeals
NO. 14-14-00395-CV
BECKY BROUSSARD AND JOSEPH BROUSSARD, Appellants
V.
TEXAS FARM BUREAU UNDERWRITERS, Appellee
On Appeal from the 157th District Court
Harris County, Texas
Trial Court Cause No. 2013-08014
MEMORANDUM OPINION
In this appeal, the insureds assert the trial court erred in granting summary
judgment in favor of an insurance company and declaring that the insurance
company owed them no duty to defend or indemnify. We affirm.
BACKGROUND
Texas Farm Bureau Underwriters (Farm Bureau) issued a homeowner’s
insurance policy to Becky and Joseph Broussard for their property in Dayton,
Liberty County, Texas. Becky injured an individual while she was operating an
all-terrain vehicle (ATV) near another property the couple owned in Polk County.
The Broussards reported a claim to Farm Bureau for the accident. On January 16,
2013, the injured individual filed suit against the Broussards (the underlying suit),
and the Broussards requested that Farm Bureau defend and indemnify the
underlying suit. Farm Bureau provided a defense to the Broussards with a
reservation of rights.
At about the same time, Farm Bureau filed the instant declaratory judgment
action in Harris County, seeking a declaration that it has no duty to (a) defend or
indemnify the Broussards for the underlying suit and (b) make medical payments
to the injured plaintiff in the underlying suit. The Broussards answered with a
general denial and a counterclaim for a declaration that Farm Bureau owed them
both a duty to defend and indemnify and to make medical payments in the injured
plaintiff in the underlying suit.
Farm Bureau filed a motion for summary judgment on the coverage. The
Broussards responded to the summary judgment and amended their petition to add
various counterclaims, including claims for alleged violations of the Texas
Deceptive Trade Practices-Consumer Protection Act (DTPA). The trial court
granted Farm Bureau’s motion for summary judgment on the duty to defend and
indemnify and make medical payments in the underlying suit, but reserved
judgment on the Broussards’ counterclaims. Farm Bureau filed another motion for
summary judgment on these counterclaims on both traditional and no-evidence
grounds.
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The trial court ultimately granted Farm Bureau a full and final summary
judgment, 1 disposing of all claims and counterclaims and declaring that Farm
Bureau had no duty to defend or indemnify the underlying suit. The Broussards
filed a motion for new trial.2 The motion was overruled by operation of law, and
this appeal timely followed.
ANALYSIS
On appeal, the Broussards do not challenge the trial court’s summary
judgment on their counterclaims, other than the DTPA. And the Broussards do not
claim that there was originally coverage for the underlying suit under the insurance
policy at issue. Instead, they assert that the trial court erred in declaring that Farm
Bureau did not owe a duty to defend or indemnify in the underlying suit or owe
them attorney’s fees under the DTPA in the instant suit because: (1) Farm Bureau’s
settlement of the underlying suit operates to collaterally estop Farm Bureau from
claiming it did not owe them a duty to defend or indemnify; (2) the doctrine of
quasi-estoppel precludes Farm Bureau from claiming it did not owe them any
duties in the underlying suit; (3) Farm Bureau’s settlement of the underlying suit
operates as a judicial admission of Farm Bureau’s “obligation and duty to the
Broussards in the present suit”; and (4) an award of actual damages is not a
requirement for attorney’s fees under the DTPA. Effectively, the gravamen of the
Broussards’ appeal is that when Farm Bureau settled the underlying case, (a) Farm
Bureau could no longer challenge coverage in the instant declaratory judgment
1
The trial court initially denied Farm Bureau’s summary judgment motion in part. Farm
Bureau then filed a motion to reconsider, which the trial court granted and, thereupon entered
judgment in favor of Farm Bureau on all of its claims and the Broussards’ counterclaims.
2
The Broussards’ motion for new trial raises the same arguments as the Broussards raise
on appeal, along with a new allegation that venue was not proper in Harris County. The
Broussards had not previously pleaded improper venue and do not urge venue error in this
appeal.
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action, which (b) rendered the Broussards prevailing parties in this case. We
disagree.
We review de novo the trial court’s decision to grant a summary judgment.
Ferguson v. Bldg. Materials Corp. of Am., 295 S.W.3d 642, 644 (Tex. 2009).
Texas Rule of Civil Procedure 166a(c) provides that a movant is entitled to
summary judgment if the summary judgment evidence establishes that “there is no
genuine issue of material fact and the moving party is entitled to judgment as a
matter of law on the issues expressly set out in the motion or in an answer or any
other response.” Tex. R. Civ. P. 166a(c); Am. Tobacco Co., Inc. v. Grinnell, 951
S.W.2d 420, 425 (Tex. 1997). To the extent the Broussards are appealing from the
trial court’s denial of their motion for new trial, we review that decision for an
abuse of discretion. See Metro. Transit Auth. v. McChristian, 449 S.W.3d 846, 854
(Tex. App.—Houston [14th Dist.] 2014, no pet.) (citing In re R.R., 209 S.W.3d
1112, 114 (Tex. 2006) (per curiam)). A trial court abuses its discretion when it
acts arbitrarily or unreasonably, or without reference to any guiding rules or
principles. Id. (citing Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238,
241–42 (Tex. 1984)).
To be clear, the Broussards’ arguments regarding estoppel and judicial
admissions spring from Farm Bureau’s settlement of the underlying suit, but the
suit in which they seek their attorney’s fees is this case, which, as noted above,
began as Farm Bureau’s declaratory judgment action. Indeed, it is undisputed that
Farm Bureau, after reserving its rights, provided the Broussards with a defense and
ultimately indemnified them in the underlying suit. With these facts in mind, we
address the Broussards’ grounds for urging reversal of the trial court’s judgment in
this case.
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First, insurance coverage cannot be established by estoppel: “The doctrine
of estoppel cannot be used to create insurance coverage when none exists by the
terms of the policy.” Tex. Farmers Ins. Co. v. McGuire, 744 S.W.2d 601, 602–03
(Tex. 1988); see also Metro Allied Ins. Agency, Inc. v. Lin, 304 S.W3d 830, 836
(Tex. 2009); Ulico Cas. Co. v. Allied Pilots Ass’n, 262 S.W.3d 773, 779, 780 (Tex.
2008). Thus, the Broussards may not rely on estoppel to undermine the trial
court’s declaration that Farm Bureau owed them no duty to defend or indemnify
the underlying suit.
Second, the “judicial admission” the Broussards claim establishes coverage
is the following excerpt from Farm Bureau’s motion to reconsider the partial denial
of its motion for summary judgment:
Texas Farm Bureau has continued to defend the Broussards and also
made an economic decision to settle the claims [in the underlying
suit]. That settlement is being completed. Having been fully
defended and indemnified from what the Court has already held was
not a covered claim, the Broussards have no actual damages to assert
against Texas Farm Bureau.
A judicial admission “occurs when an assertion of fact is conclusively established
in live pleadings.” Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d 887, 905
(Tex. 2000). Farm Bureau did not in any way “admit” that it owed a duty to
defend or indemnify the Broussards, nor have the Broussards provided any
authority for the proposition that such an admission would result in coverage
where none exists.3
Finally, the Broussards assert that, because Farm Bureau defended and
indemnified them in the underlying suit, which is the relief they were requesting in
the instant suit, they are “prevailing parties” under the DTPA. “Each consumer
3
We need not, and do not, address whether a judicial admission could create coverage
where none exists under an insurance policy.
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who prevails shall be awarded court costs and reasonable and necessary attorneys’
fees.” Tex. Bus. & Comm. Code Ann. § 17.50(d) (West, Westlaw through 3d C.
Sess.). But, as discussed above, none of the grounds presented by the Broussards
created coverage where none existed, and they have not challenged the trial court’s
determination that the policy itself precluded coverage of the underlying suit.
Indeed, the trial court explicitly ruled against them on all their counterclaims,
including their DTPA claim. Thus, they cannot be said to be prevailing parties
under the DTPA. 4
In sum, trial court did not err in granting summary judgment to Farm
Bureau. Because the trial court did not err in granting summary judgment, the trial
court did not abuse its discretion in denying the Broussards’ motion for new trial.
We overrule the Broussards’ sole appellate issue.
We affirm the trial court’s judgment.
/s/ Sharon McCally
Justice
Panel consists of Chief Justice Frost and Justices Boyce and McCally.
4
The Broussards also assert that Farm Bureau’s reservation of rights “does not shield it
from the application of estoppel or any other law in the instant case.” However, they did not
raise this ground in the trial court. See Tex. R. Civ. P. 166a(c) (only issues expressly presented
to the trial court by written motion, answer or other response may be considered on appeal as
grounds for reversal of a summary judgment); Tex. R. App. P. 33.1(a) (to present a complaint for
appellate review, record must show complaint was timely made to trial court). Thus, they have
failed to preserve error, and we do not address this complaint on appeal.
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