Court of Appeals of Texas, Fifth District, Dallas
GLENN MCCAIN, INDIVIDUALLY AND AS NEXT FRIEND OF D.M., Appellant
PROMISE HOUSE, INC. AND ARCH INSURANCE COMPANY, Appellees
Appeal from the 162nd Judicial District Court Dallas County,
Texas Trial Court Cause No. DC-14-13980
Justices Bridges, Fillmore, and Stoddart.
L. BRIDGES JUSTICE.
McCain, individually and as next friend of D.M., appeals the
trial court's summary judgment in favor of Promise House,
Inc. and Arch Insurance Company. In two issues, McCain argues
the trial court erred in granting summary judgment for
Promise House and Arch and denying summary judgment in favor
of McCain. We reverse the trial court's judgment, render
judgment that McCain recover against both Promise House and
Arch under the $400, 000 settlement agreement, and remand
this case to the trial court so that the settlement agreement
can be approved by the guardian ad litem and for further
proceedings consistent with this opinion.
December 2014, McCain sued Promise House alleging claims of
negligence, negligent hiring, negligent supervision,
negligent training, negligence per se, and breach of
fiduciary duty. McCain alleged his eleven-year-old son, D.M.,
was physically and sexually abused by an "older male
individual" while D.M. was a resident of Promise House,
a residential social services care facility.
to the McCain lawsuit, in January 2013, Promise House
obtained a commercial general liability insurance policy from
Arch. The policy contained a "sexual or physical abuse
liability endorsement" providing the following:
[Arch] will pay those sums that [Promise House] becomes
legally obligated to pay as "damages" because of
"bodily injury" or "personal and advertising
injury" to which this policy applies arising out of
"sexual or physical abuse."
[Arch] will have the right and duty to defend [Promise House]
against any "suit" seeking those
"damages." However, [Arch] will have no duty to
defend [Promise House] against any "suit" seeking
"damages" for "bodily injury" or
"personal and advertising injury" to which this
insurance does not apply. [Arch] may, at our discretion,
investigate any act of "sexual or physical abuse"
and settle any claim or "suit" that may result.
McCain filed the underlying lawsuit, Promise House filed a
claim under the policy requesting that Arch provide it with a
defense. Arch retained counsel to represent Promise House,
and counsel filed an answer on behalf of Promise House on
December 15, 2014.
January 14, 2015, counsel for Promise House sent a letter to
McCain's counsel pursuant to Rule 11 of the rules of
civil procedure. The letter provided as follows:
Pursuant to discussions today, please allow this
correspondence to serve as a Rule 11 Agreement wherein
[McCain has] agreed to settle and release any and all claims,
or potential claims, against [Promise House] for a total of
Four Hundred Thousand and 00/100 Dollars ($400, 000). This is
a full and final release of all claims which were brought or
could have been brought related to the incident at issue.
This settlement will be memorialized in a final settlement
agreement. As previously discussed, the parties have further
agreed they will file for the appointment of a guardian ad
Please confirm this agreement by signing below. Thank you for
your immediate attention to this matter.
Rule 11 agreement was already signed by counsel for Promise
House, and McCain's counsel signed the agreement upon
receipt and returned it. On January 29, 2015, another
attorney at the firm representing Promise House informed a
mediator involved in the case that the matter had
"settled per a Rule 11 Agreement and we have a Court