Carlton v Trinity Universal Ins. Co.

• Decision Date: 16 November 2000
• Citation: 32 S.W.3d 454
• Parties: <!--32 S.W.3d 454 (Tex.App.-Houston 2000) DENNIS CARLTON, INDIVIDUALLY AND AS REPRESENTATIVE OF ALL PERSONS SIMILARLY SITUATED, Appellant v. TRINITY UNIVERSAL INSURANCE COMPANY, Appellee NO. 14-99-00825-CV In The Fourteenth Court of Appeals
• Court: Texas Court of Appeals

Page 454

32 S.W.3d 454 (Tex.App.-Houston [14th Dist.] 2000)

DENNIS CARLTON, INDIVIDUALLY AND AS REPRESENTATIVE OF ALL PERSONS SIMILARLY SITUATED, Appellant v TRINITY UNIVERSAL INSURANCE COMPANY, Appellee

NO. 14-99-00825-CV

In The Fourteenth Court of Appeals

November 16, 2000.

On Appeal from the 56th District Court Galveston County, Texas Trial Court Cause No. 98CV0674

[Copyrighted Material Omitted] Panel consists of Justices Anderson, Frost, and Cannon.^*

OPINION

Kem Thompson Frost, Justice.

This is an appeal of a summary judgment in a class action lawsuit by a policyholder against his insurance company to recover damages for losses suffered as the result of damage to his insured automobile. The policyholder, Dennis Carlton, brought suit against Trinity Universal Insurance Company on behalf of himself and all insureds similarly situated, claiming Trinity was obligated to pay for the "inherent diminished value" of his vehicle. At issue is the scope of coverage and the insurer's limit of liability under the insurance policy.

I. Factual and Procedural Background

Carlton purchased a "Texas Standard Personal Auto Policy"¹ from Trinity covering his 1993 Dodge Spirit automobile. During the policy period, thieves stole Carlton's vehicle. Carlton promptly notified Trinity of the loss. Although the police were able to recover Carlton's automobile, it suffered damages as a result of the theft. In addition, the thieves put more than 3,500 miles on the vehicle while it was in their possession. Carlton originally asked Trinity to declare his vehicle a total loss because of the extent of the damage and the additional mileage. Trinity, however, determined that Carlton's automobile could be repaired and returned to its pre-theft condition. Carlton authorized Trinity to repair the vehicle, and Carlton had no complaint with the extent, nature, or quality of the repairs Trinity made. However, he alleged that even though the repairs were not improper, inadequate or incomplete, the value of his automobile was diminished as a result of the loss. Carlton asserted that Trinity was required to pay the "inherent diminished value," which Carlton defines as the difference between the pre-loss value of the insured automobile and its value after Trinity repaired it and returned it to him. Carlton alleged that his vehicle's "inherent diminished value" was appraised at no less than $449.90, and that when he traded his repaired automobile to a dealer the same day Trinity returned it to him, he received at least $2,000 less than the "blue book" trade-in value. Trinity refused to pay on the stated grounds that "inherent diminished value" was not a covered loss under the policy.

On July 24, 1998, Carlton's attorney sent a notice letter, under the Texas Deceptive Trade Practices - Consumer Protection Act ("DTPA"), to Trinity's president on behalf of Carlton and all others similarly situated. Enclosed in the letter was a draft of an unfiled original class action petition. The letter demanded that Trinity pay Carlton $3,780.88, which included damages and attorney's fees, within sixty days of receipt of the letter. The letter also demanded, "that Trinity settle on similar terms" with the class defined in the enclosed draft petition. Trinity sent a response letter to Carlton's counsel on August 26, 1998, tendering a check in the amount of $3,780.88 to Carlton individually. The letter did not offer to settle or purport to settle with anyone else. Carlton characterized Trinity's tender as an "offer" and rejected it by a letter dated September 16, 1998.

Carlton brought a class action suit,² asserting a number of class claims, including breach of contract and violations of the Texas Insurance Code and DTPA.³ Trinity moved for summary judgment on three independent grounds; Carlton responded and, in addition, filed a cross-motion for partial summary judgment. The trial court granted summary judgment in favor of Trinity and denied Carlton's motion for partial summary judgment. Carlton filed a motion for a new trial, which was overruled by operation of law.

II. Issues Presented on Appeal

Carlton appeals on five issues.⁴ In the second and fifth issues, he alleges the trial court erred in granting summary judgment in favor of Trinity on the grounds that "inherent diminished value" is not a covered loss under the Texas Standard Personal Auto Policy and asserts the trial court should have entered partial summary judgment in his favor because "inherent diminished value" is a covered loss. In his fourth issue, Carlton alleges the trial court erred in granting summary judgment in favor of Trinity on the grounds that Trinity's tender of payment to him alone, in response to a demand letter sent on behalf of both the prospective class members and Carlton individually, bars the DTPA class claims as a matter of law. Finally, in the remaining issue, Carlton alleges the trial court erred in granting summary judgment in favor of Trinity on the grounds that the DTPA correspondence constituted an agreement enforceable under Texas Rule of Civil Procedure 11, settling all class claims as a matter of law. For the reasons explained below, we affirm the judgment of the trial court.

III. Motions to Strike

Before reaching the merits of Carlton's appellate issues, we first address a motion Trinity filed in this court asking us to strike what Trinity describes as "extraneous and improper information" in Carlton's appellate briefing. Trinity's motion is aimed at a portion of the appendix filed with Carlton's appellate brief containing several documents from cases that are not in the appellate record, including: (a) an unpublished summary judgment order that is currently the subject of a separate, unrelated appeal; (b) a document entitled "Stipulation of Damages," apparently from the same unrelated case; and (c) an unpublished interlocutory order denying "Defendant's Motion for Summary Judgment" in another unrelated case.⁵ After submission, Trinity, like Carlton, also submitted a document that was not in the appellate record, a bulletin from the Texas Department of Insurance. Our review is confined to the evidence in the appellate record. See Sabine Offshore Serv., Inc. v. City of Port Arthur, 595 S.W.2d 840, 841 (Tex. 1979); Sewell v. Adams, 854 S.W.2d 257, 259 (Tex.App.--Houston [14th Dist.] 1993, no writ). It is improper for any party to cite unpublished judgments and orders from various courts as authority when such items do not appear in the appellate record. See Tex. R. App. P. 47.7; Carlisle v. Phillip Morris, Inc., 805 S.W.2d 498, 501 (Tex. App.--Austin 1991, writ denied). It is also improper for parties to rely on matters outside the record in making arguments to the court. See, e.g., Melendez v. Exxon Corp., 998 S.W.2d 266, 280 (Tex. App.--Houston [14th Dist.] 1999, no pet.) (holding parties are to confine their arguments and factual recitations to matters contained in the record). Therefore, we shall strike and not consider the improper items submitted by both Carlton and Trinity and shall confine our review to the appellate record.

IV. Standard of Review For Summary Judgments

We review summary judgments in accordance with the following rules:

(1) The movant has the burden of showing there is no genuine issue of material fact and that he is entitled to judgment as a matter of law;

(2) In deciding whether there is a disputed material fact issue precluding summary judgment, evidence favorable to the non-movant will be taken as true; and

(3) Every reasonable inference must be indulged in favor of the non-movant, and any doubts will be resolved in favor of the non-movant.

See Metromarketing Servs., Inc. v. HTT Headwear, Ltd., 15 S.W.3d 190, 193-94 (Tex. App.--Houston [14th Dist.] 2000, no pet.) (citing Am. Tobacco Co. v. Grinnell, 951 S.W.2d 420, 425 (Tex. 1997)). A movant is entitled to summary judgment when it negates at least one element of the plaintiff's theory of recovery or pleads and conclusively establishes each element of an affirmative defense. See Science Spectrum, Inc. v. Martinez, 941 S.W.2d 910, 911 (Tex. 1997). In reviewing the denial of a motion for partial summary judgment, we use the same standard of review that governs the granting of a summary judgment. See Am. Broad. Cos., Inc. v. Gill, 6 S.W.3d 19, 27 (Tex. App.--San Antonio 1999, pet. denied); Evans v. Dolcefino, 986 S.W.2d 69, 75 (Tex. App.--Houston [1st Dist.] 1999, no pet.). When a trial court grants summary judgment for one movant and denies it for another without specifying the reason for its ruling, we may affirm the trial court's judgment if any of the grounds raised in the prevailing party's motion are meritorious. See Camco Int'l, Inc. v. Perry R. Bass, Inc., 926 S.W.2d 632, 635 (Tex. App.--Fort Worth 1996, writ denied). However, if the non-prevailing movant raised meritorious grounds in its previously denied motion, then we may reverse and render judgment in favor of that party. See id.

V. Construction and Interpretation of Insurance Policy Provisions

In his second issue, Carlton asserts the trial court erred in granting summary judgment in favor of Trinity on the grounds that "inherent diminished value" is not a covered loss under the Texas Standard Personal Auto Policy. In Carlton's fifth issue, he asserts that "inherent diminished value" is covered under the policy as a matter of law and, therefore, we must render partial summary judgment for him.

A. Applicable Rules of Construction and Interpretation

We interpret insurance policies in accordance with the rules of contract construction. See Kelley-Coppedge, Inc. v. Highlands Ins. Co., 980 S.W.2d 462, 464 (Tex. 1998). In applying these rules, our primary concern is to ascertain the parties' intent as expressed in the policy. See id. (citing Nat'l. Union Fire Ins. Co. v. CBI Indus., Inc., 907 S.W.2d 517, 520 (Tex. 1995)). In determining the intention of the parties, we look only within the four corners of the...