Court of Appeals of Texas, Fifth District, Dallas
UNITED AUTOMOBILE INSURANCE SERVICES AND OLD AMERICAN COUNTY MUTUAL FIRE INSURANCE COMPANY, Appellants
ALVIN GLENN RHYMES, Appellee
Appeal from the 95th Judicial District Court Dallas County,
Texas Trial Court Cause No. DC-15-07623
Justices Lang, Brown, and Whitehill
Alvin Glenn Rhymes sued appellants United Automobile
Insurance Services (UAIS) and Old American County Mutual Fire
Insurance Company. Rhymes claimed that (i) he was injured in
an auto accident with Maria S. Hernandez, (ii) Maria was
insured under an Old American auto insurance policy, (iii) he
obtained a default judgment against her for about $54, 000,
and (iv) he was entitled to recover on the Old American
insurance policy. The parties filed cross-motions for
summary judgment, and the trial court granted summary
judgment for Rhymes.
evidence established that Maria never gave notice of suit to
or requested a defense from UAIS or Old American. The pivotal
question in this case is whether that fact conclusively
defeats Rhymes' claims. Because it does, we reverse and
render judgment that Rhymes take nothing.
these facts from the summary judgment evidence:
American writes personal auto insurance in Texas through
managing general agents like UAIS. UAIS handles any claims
arising under Old American policies it issues.
Hernandez bought an Old American personal auto insurance
policy through UAIS. The policy went into effect in May 2011
and listed Maria Hernandez as an authorized driver. The
bodily injury policy limit was "30, 012/person."
2012, Rhymes sued Maria S. Hernandez in a Texas district court,
alleging that he was injured in a June 2011 auto accident
that she negligently caused. Maria was served with process
but did not answer. In November 2012, the court signed a
default judgment awarding Rhymes $53, 073 in damages and
$737.95 in court costs against Maria. Rhymes sent a copy of
the default judgment to UAIS over six months later.
Rhymes' attorney was also communicating with UAIS about
the accident and attempting to settle his personal injury
claim against Maria. UAIS made several unsuccessful attempts
to contact Francisco and Maria about the matter before the
default judgment was signed. Maria and Francisco never
contacted UAIS or Old American, never sent suit papers to
them, and never asked them to defend Maria.
sued appellants. His live pleading asserted two claims: One
was a contract claim based on Rhymes' status as a
third-party beneficiary of the Old American policy. The other
was styled a "Stowers/Negligence" claim
based on appellants' "negligent failure to
settle" Rhymes' personal injury claim against Maria
within policy limits.
filed a motion for partial summary judgment "on the
issue of coverage, " and Appellants filed a summary
judgment motion seeking a final take-nothing judgment.
side responded to the other's motion. Rhymes'
response included evidence that he had obtained a turnover
order in the underlying suit against Maria. The order
required Maria to turn over to Rhymes all rights, title, and
interest in the insurance policy.
hearing, the trial judge signed two orders. One denied
appellants' motion. The other order (i) recited that the
insurance policy covered Rhymes' damages and (ii) awarded
Rhymes $30, 012 against "Defendant." Although the
second order did not mention Rhymes'
"Stowers/Negligence" claim, it implicitly
denied that claim by including language sufficient to make it
a final judgment.
raise two issues. Their first issue argues that the trial
court erred by granting summary judgment for Rhymes instead
of for appellants because the evidence established that (i)
Maria never gave appellants notice that she had been sued and
(ii) the default judgment prejudiced appellants. Their second
issue argues that the trial court erred by granting ...