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In re Philadelphia Indemnity Insurance Co.

Court of Appeals of Texas, Thirteenth District, Corpus Christi-Edinburg

November 20, 2017

IN RE PHILADELPHIA INDEMNITY INSURANCE COMPANY

         On Petition for Writ of Mandamus.

          Before Chief Justice Valdez and Justices Contreras and Hinojosa

          MEMORANDUM OPINION

          DORI CONTRERAS JUSTICE

         Relator, Philadelphia Indemnity Insurance Co. (Philadelphia), has filed a petition for writ of mandamus contending that the Honorable Fred Garza, presiding judge of the Hidalgo County Court at Law No. 4, abused his discretion, leaving relator without an adequate appellate remedy, by rendering an order on May 12, 2017 granting a motion to set aside an insurance appraisal award. The real parties in interest, Iglesia del Pueblo, Inc. and Radio Imagen 1580 AM (collectively Iglesia), filed a response to the petition pursuant to our request. We will deny mandamus relief.

         I. Background

         This dispute concerns the appraisal of property damage under an insurance policy. After its property was allegedly damaged by wind and hail, Iglesia made a claim on its commercial property policy issued by Philadelphia. Philadelphia retained an independent adjusting firm, which determined that the damage amount was $9, 470.82, far below the policy's deductible of $26, 189.30. Therefore, Philadelphia informed Iglesia that it would not issue any payment for the claimed loss.

         Nearly two years later, Iglesia's counsel sent Philadelphia a letter demanding another appraisal, citing the following appraisal clause contained in the policy:

If we and you disagree on the amount of loss, either may make written demand for an appraisal of the loss. In this event, each party will select a competent and impartial appraiser and notify the other of the appraiser selected within 20 days of such demand. The two appraisers will select an umpire. If they cannot agree within 15 days upon such umpire, either may request that selection be made by a judge of a court having jurisdiction. Each appraiser will state the amount of loss. If they fail to agree, they will submit their differences to the umpire. A decision agreed to by any two will be binding as to the amount of loss.

         In the letter, Iglesia's counsel identified Sergio De La Canal as its selected appraiser. Philadelphia replied with a letter agreeing to submit to the appraisal process and identifying Darrell Edwards as its selected appraiser. Iglesia objected to the selection of Edwards on grounds that he was found in 2012 to be engaging in the unauthorized practice of law, and also was a defendant in an unrelated case involving Iglesia's counsel. According to Iglesia, because the two selected appraisers were unable to agree upon an umpire within fifteen days, it asked the Honorable Israel Ramon, presiding judge of the 430th District Court, to select an umpire pursuant to the above policy term. Judge Ramon selected Andy Almaguer in a "Declaration for Umpire Appointment" dated May 13, 2014. However, on May 19, 2014, De La Canal and Edwards executed a "Declaration of Appraisers" document selecting Tom Powell as umpire.

         Iglesia filed the instant suit in the Hidalgo County Court at Law No. 4 on November 5, 2014, alleging that Philadelphia and Edwards have "refused to proceed with the appraisal process" until the appointment of Almaguer is vacated. By its suit, Iglesia sought a declaration that Almaguer-not Powell-is the properly selected umpire under the policy.

         On July 26, 2015, Edwards and Powell signed a "Declaration of Appraisers Appraisal Award" finding the total amount of loss to be $29, 596 in actual replacement value, or $27, 047.20 in actual cash value. On August 24, 2015, Philadelphia issued a check to Iglesia for $3, 406.70, representing the difference between the actual replacement value as determined by Edwards and Powell and the deductible amount.

         In Feburary of 2017, Iglesia filed a motion to set aside the appraisal award, arguing that: (1) Powell was improperly designated as umpire; (2) Edwards was not competent or impartial; (3) the award improperly decided issues of coverage and liability; and (4) the award was not an "honest assessment" of the necessary repairs to its property. After considering the motion and Philadelphia's response, the trial court granted the motion to set aside the award without specifying grounds.[1] This original proceeding followed.[2]

         II. Discussion

         Mandamus is an extraordinary remedy. In re H.E.B. Grocery Co., 492 S.W.3d 300, 302 (Tex. 2016) (orig. proceeding) (per curiam). Mandamus relief is proper to correct a clear abuse of discretion when there is no adequate remedy by appeal. In re Christus Santa Rosa Health Sys., 492 S.W.3d 276, 279 (Tex. 2016) (orig. proceeding). The relator bears the burden of proving both of these requirements. In re H.E.B. Grocery Co., 492 S.W.3d at 302; Walker v. Packer, 827 S.W.2d 833, 840 (Tex. 1992) (orig. proceeding). An abuse of discretion occurs when a trial court's ruling is arbitrary and unreasonable or is made without regard for guiding legal principles or supporting evidence. In re Nationwide Ins. Co. of Am., 494 S.W.3d 708, 712 (Tex. 2016) (orig. proceeding); Ford Motor Co. v. Garcia, 363 S.W.3d 573, 578 (Tex. 2012). A trial court does not abuse its discretion if it reaches the ...


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