Court of Appeals of Texas, Fourth District, San Antonio
the 37th Judicial District Court, Bexar County, Texas Trial
Court No. 2015CI06130 Honorable Peter A. Sakai, Judge
Bryan Marion, Chief Justice, Marialyn Barnard, Justice, Luz
Elena D. Chapa, Justice.
BRYAN MARION, CHIEF JUSTICE.
sole issue presented in this appeal is whether the trial
court erred in granting summary judgment in favor of State
Farm Lloyds on Oscar Ortiz's Texas Insurance Code and
common law bad faith claims following State Farm's
payment of an appraisal award. Ortiz asserts this court must
reconsider our decision in Garcia v. State Farm
Lloyds, 514 S.W.3d 257 (Tex. App.-San Antonio 2016, pet.
denied), in light of the Texas Supreme Court's decision
in USAA Tex. Lloyds Co. v. Menchaca, No.
14-0721, 2017 WL 1311752 (Tex. Apr. 7, 2017). We disagree and
affirm the trial court's judgment.
submitted a claim to State Farm for damage to his property
resulting from wind and a hailstorm. After inspecting the
property, State Farm determined Ortiz sustained $723.53 in
damages to his property and informed Ortiz that no payment
would be made for the claim since the damage amount did not
exceed Ortiz's deductible. After a second inspection,
State Farm found some additional damage but the damage total
still did not exceed Ortiz's deductible, so no payment
April 14, 2015, Ortiz sued State Farm asserting contractual
and extra-contractual claims. On August 4, 2015, State Farm
invoked the appraisal process provided in Ortiz's
insurance policy, and Ortiz's lawsuit was abated pending
the completion of the appraisal process. On December 15,
2015, an appraisal award was issued in the amount of $9,
447.52. On December 30, 2015, State Farm paid Ortiz $4,
243.93, representing the actual cost value of the loss minus
the deductible and recoverable depreciation. State Farm
recognized that Ortiz would be entitled to the depreciation
after he made the repairs.
February 24, 2016, State Farm filed a motion for summary
judgment asserting its payment of the appraisal award
estopped Ortiz from maintaining a breach of contract claim.
State Farm further asserted the payment of the appraisal
award also precluded Ortiz's extra-contractual claims.
The trial court granted summary judgment in favor of State
Farm, and Ortiz appeals.
review the grant of a summary judgment de novo. Katy
Venture, Ltd. v. Cremona Bistro Corp., 469 S.W.3d 160,
163 (Tex. 2015). To prevail on a traditional motion for
summary judgment, the movant must show "there is no
genuine issue as to any material fact and the [movant] is
entitled to judgment as a matter of law." Tex.R.Civ.P.
v. State Farm Lloyds
Garcia, this court addressed the effect of an
insurer's payment of an appraisal award on an
insured's contractual claims. 514 S.W.3d at 264-65. We
held an insurer's payment of an appraisal award entitled
the insurer to summary judgment on its estoppel defense to an
insured's contractual claims unless the insured raised an
issue of fact as to a ground for setting aside the appraisal
award. Id. at 265. In our analysis, we noted,
"Texas law clearly holds the discrepancy between the
initial estimate and the appraisal award cannot be used as
evidence of breach of contract." Id. at 273
(internal quotation omitted).
addressed the effect of the insurer's payment of an
appraisal award on an insured's extra-contractual claims.
Id. at 276-79. With regard to an insured's
common law bad faith claim, we noted that evidence showing
"a bona fide dispute about the insurer's liability
on the contract does not rise to the level of bad
faith." Id. at 276. Instead, in order to defeat
a summary judgment on a common law bad faith claim, we held
the insured had the burden to raise a genuine issue of
material fact that the insurer failed to timely investigate
the claim or the insurer committed some act, so extreme, that
it would cause injury independent of the policy claim.
Id. at 277. After concluding the insured in
Garcia failed to present evidence of an act so
extreme that it caused injury independent of the policy
claim, we held the trial court properly granted summary
judgment on the insured's common law bad faith claim.
Id. at 278. With regard to the insured's
statutory bad faith claims under the Texas Insurance Code and
DTPA, we noted that when statutory bad faith claims are based
on the same wrongful conduct underlying the insured's
common law bad faith claim, there can be no liability on the
statutory claims if there is no merit to the common law bad
faith claim. Id. at 279. Because the insured's
statutory claims in Garcia arose from the same
underlying theory as her common law bad faith claim, we held
"that because she failed to present evidence on her
breach of common law bad faith claim or of an independent
injury, and because State Farm timely paid all covered
damages determined by the appraisal award, [the
insured's] statutory bad faith claims [were]
Tex. Lloyds ...