in Re Allstate County Mutual Insurance Company ( 2011 )

Petition for Writ of Mandamus Conditionally Granted and Majority and Concurring
and Dissenting Opinions filed October 20, 2011.
In The
Fourteenth Court of Appeals
____________
NO. 14-11-00746-CV
____________
IN RE ALLSTATE COUNTY MUTUAL INSURANCE COMPANY, Relator
ORIGINAL PROCEEDING
WRIT OF MANDAMUS
344th District Court
Chambers County, Texas
Trial Court Cause No. 25233
OPINION
In this original proceeding, relator, Allstate County Mutual Insurance Company,
seeks a writ of mandamus ordering respondent, the Honorable Carroll E. Wilborn, Jr., to
(1) vacate his order denying Allstate's motion to sever the extra-contractual claims from the
claim for underinsured-motorist (UIM) benefits and abate those claims until the
contractual claims are resolved; (2) compel respondent to sever the extra-contractual
claims; and (3) abate the extra-contractual claims. We requested a response from the real
party in interest, Charlotte Juneau, but as of this date no response has been filed. We
conditionally grant the writ.
Juneau sued Allstate for UIM benefits due to an automobile accident and also
alleged a breach-of-contract claim, along with extra-contractual claims for bad faith under
the insurance code and deceptive trade practices act. Allstate offered to settle the claim.
The offer was not accepted and Allstate filed a motion to sever the contractual claims and
abate the extra-contractual claims. The trial court denied Allstate’s motion.
Allstate complains that respondent abused his discretion in refusing to (1) sever the
extra-contractual claims from the claim for UIM benefits when a settlement offer had been
made; and (2) abate the extra-contractual claims until the underlying contractual claims are
resolved. In cases in which contractual and extra-contractual claims are being pursued
simultaneously, this court repeatedly has held that extra-contractual claims must be
severed and abated when the insurer has made a settlement offer on the contract claim.
See Mid-Century Ins. Co. v. Lerner, 901 S.W.2d 749, 752-53 (Tex. App. -- Houston [14th
Dist.] 1995, orig. proceeding); Northwestern Nat'l Lloyds Ins. Co. v. Caldwell, 862 S.W.2d
44, 46-47 (Tex. App. -- Houston [14th Dist. 1993, orig. proceeding); State Farm Mut. Auto.
Ins. Co. v. Wilborn, 835 SW.2d 260, 262 (Tex. App. -- Houston [14th Dist.] 1992, orig.
proceeding). Accordingly, we conclude the trial court abused its discretion in not
severing and abating the extra-contractual claims. See In re Progressive County Mut. Ins.
Co., No. 09-07-00011-CV, 2007 WL 416553 (Tex. App. – Beaumont 2007, orig.
proceeding) (mem. op) (“Abatement of the bad faith claim necessarily accompanies
severance because the scope of permissible discovery differs in the two types of claim and
without abatement the parties will be put to the effort and expense of conducting discovery
on claims that may be disposed of in a previous trial.”)
We conditionally grant the petition for a writ of mandamus and direct the trial court
to (1) vacate its order denying Allstate's motion, (2) sever the extra-contractual claims from
the contractual claims, and (3) abate the proceedings on the bad-faith claims until final
2
disposition of the UIM claim. The writ will issue only if the trial court fails to act in
accordance with this opinion.
/s/ Jeffrey V. Brown
Justice
Panel consists of Justices Brown, Boyce, and McCally. (McCally, J., Concurring and
Dissenting.)
3