Hi-Line Elec. Co. v. Travelers Ins. Companies

• Decision Date: 14 August 1979
• Docket Number: No. 19964,HI-LINE,19964
• Citation: 587 S.W.2d 488
• Parties: ELECTRIC COMPANY, Appellant, v. The TRAVELERS INSURANCE COMPANIES, Appellee.
• Court: Texas Court of Appeals

Page 488

587 S.W.2d 488

HI-LINE ELECTRIC COMPANY, Appellant, v. The TRAVELERS INSURANCE COMPANIES, Appellee.

No. 19964.

Court of Civil Appeals of Texas, Dallas.

Aug. 14, 1979.

Rehearing Denied Sept. 19, 1979.

John D. Griggs, Dallas, for appellant.

Timothy R. McCormick, Thompson & Knight, Dallas, for appellee.

Before AKIN, ROBERTSON and HUMPHREYS, JJ.

HUMPHREYS, Justice.

This appeal concerns whether appellant Hi-Line Electric Company is a consumer under the Deceptive Trade Practices-Consumer Protection Act, Tex. Bus. & Com. Code Ann. §§ 17.41-17.63 (Vernon Supp. 1978-1979) (DTPA). Appellant Hi-Line alleged that it purchased services and leased goods from third parties in reliance on misrepresentations of an adjuster for appellee, Travelers Insurance Company. Summary judgment was granted for appellee Travelers on the ground that appellant did not have a cause of action under the DTPA or the Insurance Code. We affirm and hold that appellant is not a consumer for the purposes of the DTPA because appellant did not seek or acquire goods or services from appellee. We also hold that appellant has no cause of action under either the Unfair Claim Settlement Practice Act, Tex. Ins. Code Ann. art. 21.21-2 (Vernon Supp. 1978), or under the unfair practices provisions of the Insurance Code, Tex. Ins. Code Ann. art. 21.21 (Vernon 1963 & Supp. 1978) because article 21.21-2 does not confer a private cause of action and any private action under article 21.21 must be based on the DTPA, which, we hold, does not apply to this case.

This case arose from an automobile accident between appellant and appellee's insured. Appellant sued appellee's insured for negligence and sued appellee, the insurance carrier, for breach of contract, fraud, and for violations of the DTPA and of the Insurance Code. After appellant's action against appellee was severed, partial summary judgment was granted denying appellant's claims against appellee under section 17.50 of the DTPA and the Insurance Code. The case then proceeded to trial on the grounds of breach of contract and fraud, and appellant was awarded judgment in the amount of $519.64. Appellant complains only of the court's grant of partial summary judgment and its failure to set aside the summary judgment.

According to appellant, after the accident, appellee agreed to pay for repairs to appellant's truck, rental of another truck, and the cost of transferring merchandise between the damaged truck and the leased truck. It also contends that appellee made recommendations as to where to have repairs performed and where to rent the vehicle. Appellant claims that it was forced to pay the repair and rental costs when appellee refused to do so , and that its own insurance company would have paid these bills if appellee had not promised to pay them. Appellant also alleged that appellee agreed to pay without intending to do so and consequently, violated the DTPA.

Appellee seeks to justify the summary judgment on the ground that the petition shows on its face that appellant is not a "consumer" with respect to appellee within the ambit of the DTPA. Appellee points out that in order to sue under section 17.50 of the DTPA, plaintiff must be a consumer, which is defined in section 17.45(4) as "an individual, partnership, corporation, or governmental entity Who seeks or acquires by purchase or lease, any goods or services." Appellee cites Russell v. Hartford Casualty Insurance Co., 548 S.W.2d 737 (Tex.Civ.App.-Austin 1977, writ ref'd n. r. e.), for the proposition that appellant is not a consumer. Russell is not controlling here because in that case, plaintiffs did not purchase or lease any goods or services. As in the present case, the plaintiffs in Russell were involved in a collision with defendant's insured. After defendant Hartford provided a rental car for seven days and then cancelled the agreement, plaintiffs sued Hartford under the DTPA. The court held that the plaintiffs in that case were not consumers because they did not purchase or lease anything. 548 S.W.2d at 741. In this case, appellant purchased services and leased goods from third parties at appellee's suggestion but not from appellee. Our question then is whether the DTPA provides a cause of action when the services and leased items were sought and obtained from third parties.

Appellee contends that a consumer must seek or acquire goods or services From the person he is suing. We agree. Although the plaintiff and defendant need not be in privity or in a contractual relationship, a consumer must seek or acquire goods or services furnished by defendant. In this case, appellee only represented to appellant that it would pay money to appellant for appellant's purchase of goods and services from others. The DTPA was not intended to cover situations where the defendant is not engaged in any sale or lease transaction, or any offer or advertisement of a sale or lease, with plaintiff. The Act was designed to protect consumers from misleading business practices made in connection with a sale,...