Nassar v. Liberty Mut. Fire Ins. Co., 14–14–00277–CV

• Decision Date: 29 September 2015
• Docket Number: NO. 14–14–00277–CV,14–14–00277–CV
• Citation: 478 S.W.3d 65
• Parties: Elie Nassar and Rhonda Nassar, Appellants v. Liberty Mutual Fire Insurance Company, Liberty Mutual Group, Dave Baker, Mary Hamilton and Marcus Smith, Appellees
• Court: Texas Court of Appeals

478 S.W.3d 65

Elie Nassar and Rhonda Nassar, Appellants

v.Liberty Mutual Fire Insurance Company, Liberty Mutual Group, Dave Baker, Mary Hamilton and Marcus Smith, Appellees

NO. 14–14–00277–CV

Court of Appeals of Texas, Houston (14th Dist.).

Opinions filed September 29, 2015

Rehearing En Banc Overruled November 3, 2015

Kurt B. Arnold, Matthew Paul Skrabanek, Houston, TX, for appellant.

Eric Scott Peabody, Catherine L. Hanna, Austin, TX, for appellee.

Panel consists of Chief Justice Frost, and Justices Boyce and McCally.

OPINION

William J. Boyce, Justice

In three issues, Elie and Rhonda Nassar challenge summary judgment orders in favor of Liberty Mutual Fire Insurance Company, Liberty Mutual Group, Dave Baker, Mary Hamilton, and Marcus Smith (collectively, "Liberty Mutual"). The trial court signed the summary judgment orders in connection with an insurance coverage dispute and an appraisal award arising from damage to the Nassars' residence that occurred when Hurricane Ike struck southeast Texas in September 2008. Collectively, these orders resolve all issues and constitute a final judgment.

We affirm the trial court's judgment.

BACKGROUND

The Nassars own a residence at 4245 Clayhead Road in Richmond, Texas that is situated on six acres. In addition to the residence itself, these six acres contain a system of fences, barns, and outbuildings. Liberty Mutual insured the Nassars' dwelling and other structures pursuant to a Texas Homeowners Policy Form A issued for a policy period beginning on August 2, 2008, and ending on August 8, 2009. This policy was in effect when Hurricane Ike came ashore in September 2008 and caused physical loss to the insured property.

Liberty Mutual issued payments under the policy to the Nassars in November 2008 pertaining to certain physical losses caused by Hurricane Ike. Liberty Mutual and the Nassars disagreed about coverage for the Nassars' fence under the policy; they also disagreed about amounts owed for covered losses for other damage to the Nassars' dwelling and other structures.

The Nassars sued Liberty Mutual in February 2009 and asserted claims for breach of the homeowners policy; they also asserted a variety of extra-contractual claims based on Liberty Mutual's position regarding coverage of the fence, and its conduct in connection with the Nassars' claim. The trial court signed a summary judgment order in Liberty Mutual's favor on (1) the coverage issue, and (2) the Nassars' extra-contractual claims. Based on this ruling, the only remaining issues involved the parties' disagreements about amounts owed for covered losses for other damage to the Nassars' dwelling and other structures. The trial court granted Liberty Mutual's motion to compel appraisal as to these disputed amounts pursuant to a provision in the homeowners policy. After the appraisal award was issued, the trial court signed a second and final summary judgment in Liberty Mutual's favor in which it determined that no amounts were owed under the policy beyond those already paid.

The Nassars appealed and now challenge both summary judgment orders in this court.

ANALYSIS

The Nassars contend that the trial court erred by (1) granting summary judgment in favor of Liberty Mutual with respect to coverage; (2) granting summary judgment in favor of Liberty Mutual with respect to their remaining extra-contractual causes of action; and (3) compelling appraisal.

All of the issues raised on appeal were decided by way of summary judgment. We review summary judgment orders de novo. Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex.2003).

The party moving for a traditional summary judgment must establish that no material fact issue exists and that it is entitled to judgment as a matter of law. Tex. R. Civ. P. 166a(c) ; M.D. Anderson Hosp. & Tumor Inst. v. Willrich, 28 S.W.3d 22, 23 (Tex.2000). Once the movant produces sufficient evidence conclusively establishing a right to summary judgment, the burden of proof shifts to the nonmovant to present evidence sufficient to raise a fact issue. See Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex.1995). In reviewing a traditional summary judgment, we examine the entire record in the light most favorable to the nonmovant, indulging every reasonable inference and resolving any doubts against the motion. Yancy v. United Surgical Partners Int'l, Inc., 236 S.W.3d 778, 782 (Tex.2007).

In reviewing a no-evidence summary judgment under Rule 166a(i), we apply a legal-sufficiency standard. See, e.g., King Ranch, Inc. v. Chapman, 118 S.W.3d 742, 750–51 (Tex.2003). We "review the evidence presented by the motion and response in the light most favorable to the party against whom the summary judgment was rendered, crediting evidence favorable to that party if reasonable jurors could, and disregarding contrary evidence unless reasonable jurors could not." Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 582 (Tex.2006).

I. Coverage

In their first issue, the Nassars challenge the trial court's coverage determination with respect to the fence.

The parties agree that property damage to the Nassars' fence from Hurricane Ike totaled $58,000, and that a Texas Homeowners Policy Form A issued by Liberty Mutual covers this property damage. The parties also agree regarding the liability limits applicable to the individual policy subsections being litigated. They disagree about which policy subsection applies to the fence.

The Nassars contend that this property damage is covered by subsection (1) of "COVERAGE A (DWELLING)," which is subject to a $247,200 liability limit. Liberty Mutual contends that property damage to the Nassars' fence is covered pursuant to subsection (2) of "COVERAGE A (DWELLING)," which is subject to a $24,720 liability limit that Liberty Mutual already has paid. The trial court agreed with Liberty Mutual and granted summary judgment in its favor on this coverage question.

Insurance policies are construed using ordinary rules of contract interpretation. Tanner v. Nationwide Mut. Fire Ins. Co., 289 S.W.3d 828, 831 (Tex.2009). We give policy language its plain, ordinary meaning unless something else in the policy shows the parties intended a different, technical meaning. Id. When construing the policy's language, we must give effect to all contractual provisions so that none will be rendered meaningless. Kelley - Coppedge, Inc. v. Highlands Ins. Co., 980 S.W.2d 462, 464 (Tex.1998) ; see also Chrysler Ins. Co. v. Greenspoint Dodge of Houston, Inc., 297 S.W.3d 248, 253 (Tex.2009).

Liberty Mutual filed a traditional motion for summary judgment with respect to coverage. The operative policy language reads as follows.

COVERAGE A (DWELLING)

We cover:

1. the dwelling on the residence premises shown on the declarations page including structures attached to the dwelling.

2. other structures on the residence premises set apart from the dwelling by clear space. This includes structures connected to the dwelling by only a fence, utility line or similar connection. The total limit of liability for other structures is the limit of liability shown on the declaration page or 10% of Coverage A (Dwelling) limit of liability, whichever is greater.

The term "residence premises " is defined as "the residence premises shown on the declarations page. This includes the one or two family dwelling, including other structures, and grounds where an insured resides or intends to reside within 60 days after the effective date of this policy." The policy does not define "structures" in subsection (1) or "other structures" in subsection (2).

According to the Nassars, subsection (1) applies because their fence is a "structure[ ] attached to the dwelling" and is not "set apart from the dwelling by clear space." They contend that "the dwelling portion of the policy covers not only the residence but structures attached to the residence." In support of these contentions, Elie Nassar submitted a summary judgment affidavit in which he stated that "[w]e ... have a fence that is attached to my house/dwelling that encircles all of the property." He further stated that the "fence is connected and attached to my home" along the east side of the house, where "the fence is attached with two 4x4 poles connected to the slab and brick of the house by cement;" along the north side of the house, where the fence is attached via 4x4 poles connected to slab, porch, or brick; and along the west side of the house, where "the fence is directly bolted into the brick and slab of the house."

For its part, Liberty Mutual argues: "Because a fence is specifically identified as a connection that is insufficient to attach other structures to the dwelling, the fence itself cannot be an extension of the dwelling. Otherwise, like a breezeway connecting a garage, both buildings and the fence would all become part of the dwelling." According to Liberty Mutual, the policy "equates connection by a fence or utility line with ‘clear space.’ " Further, Liberty Mutual argues that "the Nassars cannot convert the entire network of fences on their six acre farm to an extension of their ‘dwelling’ by virtue of four bolts."

The Nassars respond that "the fence falls under the ‘dwelling’ portion of coverage since it is connected to the residence premises at various points, as required by the policy language." According to the Nassars, subsection (2)'s language "is used to preclude an insured from building random fences that radiate out over a property and connect to other things like barns, workshops, and sheds, which would lead to a claim that these structures are attached to the dwelling by virtue of a fence."

We conclude that the policy's unambiguous language forecloses application of subsection (1) to the Nassars' claim for property damage to the fence at issue. We reach this conclusion because, when subsections (1) and (2) are read together, a fence cannot be a "structure[ ] ... attached to the dwelling" under subsection (1). This is so because interpreting subsection (1)...