Scalise v. Allstate Tex. Lloyds

• Decision Date: 20 December 2013
• Docket Number: CIVIL ACTION NO. 7:13-CV-178
• Parties: CARL SCALISE, Plaintiff, v. ALLSTATE TEXAS LLOYDS, Defendant.
• Court: U.S. District Court — Southern District of Texas

CARL SCALISE, Plaintiff, v. ALLSTATE TEXAS LLOYDS, Defendant.

CIVIL ACTION NO. 7:13-CV-178

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF TEXAS MCALLEN DIVISION

Dated: December 20, 2013

ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

I. Factual and Procedural Background

Now before the Court is Defendant Allstate Texas Lloyds' ("Allstate") Motion for Summary Judgment. (Dkt. No. 5). This action is one of many insurance claim disputes arising from a hail storm that hit McAllen area on March 29, 2012. In the present case, Plaintiff Carl Scalise alleges that his McAllen property insured by a policy with Allstate "sustained massive amounts of covered losses in the form of hail, wind and water damages...." (Dkt. No. 1-5 at IV). Plaintiff made a claim under the policy and Allstate timely investigated the claim and tendered payment. Plaintiff disagreed that this payment reflected his total covered damages and invoked the appraisal clause of the policy to determine the amount of loss. Under the terms of that provision, the parties chose their respective "competent and independent" appraisers who then agreed on an umpire to whom the appraisers would submit their differences if they failed to agree. The appraisers inspected the property and exchanged their estimates. Claiming that Allstate's chosen appraiser, Stephen Medeiros, was neither competent nor independent because his estimate ignored "obvious covered damages," Plaintiff attempted to withdraw from the appraisal process and filed this suit against Allstate for breach of contract, breach of the duty ofgood faith and fair dealing, and violations of the Texas Insurance Code and Texas Deceptive Trade Practices Act ("DTPA"). Id. at III, V, VI, VIII, XIII.¹ Medeiros and the umpire then agreed on the award and Allstate tendered payment. Allstate now moves for summary judgment on the grounds that its payment of the appraisal award precludes Plaintiff's contractual and extra-contractual causes of action as a matter of law. (Dkt. No. 5). Upon consideration of the Motion and the parties' evidence and responsive briefing, in light of the relevant law, the Court finds that the Motion must be granted for the following reasons.

II. Allstate's Motion for Summary Judgment

A. Standard of Review

A district court must grant summary judgment when there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. FED. R. CIV. P. 56(a). A fact is material if it might affect the outcome of the lawsuit under the governing law, and a fact is genuinely in dispute only if a reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A party moving for summary judgment has the initial responsibility of informing the court of the basis for its motion and identifying those portions of the pleadings and materials in the record, if any, which it believes demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); FED. R. CIV. P. 56(a), (c). Where the movant bears the burden of proof because it is asserting an affirmative defense, it must establish "'beyond peradventure all of the essential elements of the...defense to warrant judgment in [its] favor.'" Chaplin v. NationsCredit Corp., 307 F.3d 368, 372 (5^th Cir. 2002) (quoting Fontenot v. Upjohn Co., 780F.2d 1190, 1194 (5^th Cir. 1986)) (emphasis in original). Once the moving party carries its burden, the burden shifts to the nonmovant to go beyond the pleadings and provide specific facts showing the existence of a genuine issue for trial. Celotex, 477 U.S. at 324; FED. R. CIV. P. 56(c). In conducting its review of the summary judgment record, the court "may not make credibility determinations or weigh the evidence" and must resolve doubts and reasonable inferences regarding the facts in favor of the nonmoving party. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000); Anderson, 477 U.S. at 255; Dean v. City of Shreveport, 438 F.3d 448, 454 (5^th Cir. 2006). However, the nonmovant cannot satisfy its burden with "conclusory allegations, speculation, and unsubstantiated assertions which are either entirely unsupported, or supported by a mere scintilla of evidence." Chaney v. Dreyfus Serv. Corp., 595 F.3d 219, 229 (5^th Cir. 2010); see also Brown v. City of Houston, 337 F.3d 539, 541 (5^th Cir. 2003) ("Unsubstantiated assertions, improbable inferences, and unsupported speculation are not sufficient to defeat a motion for summary judgment.").

B. Summary Judgment Evidence

Plaintiff owns a residence in McAllen that was covered by an Allstate homeowner's insurance policy for a one-year period beginning March 26, 2012. (Dkt. No. 5, Exh. I). After Plaintiff made a claim under the policy for damage to the property arising from the March 29, 2012 hailstorm, an Allstate adjuster inspected the property and determined that the total covered damages equaled $551.79. See (Dkt. No. 15, Ex. D). Allstate subtracted Plaintiff's $500.00 deductible from the total and issued Plaintiff a check in the amount of $51.79 on or around April 18, 2012. Id. By letter dated July 30, 2012, Plaintiff's counsel advised Allstate that "[s]ince there is a dispute as to the amount of the loss and/or cost of repair or replacement of the structural portion of this claim," Plaintiff was invoking the appraisal clause of the policy. (Dkt.No. 5, Exh. A). That provision states in full:

Appraisal. If you and we fail to agree on the actual value, amount of loss, or cost of repair or replacement, either can make a written demand for appraisal. Each will then select a competent, independent appraiser and notify the other of the appraiser's identity within 20 days of receipt of the written demand. The two appraisers will choose an umpire. If they cannot agree upon an umpire within 15 days, you or we may request that the choice be made by a judge of a district court of a judicial district where the loss occurred. The two appraisers will then set the amount of loss, stating separately the actual cash value and loss to each item. If you or we request that they do so, the appraisers will also set:

a. the full replacement cost of the dwelling.

b. the full replacement cost of any other building upon which loss is claimed.

c. the full cost of repair or replacement of loss to such building, without deduction for depreciation.

If the appraisers fail to agree, they will submit their differences to the umpire. An itemized decision agreed to by any two of these three and filed with us will set the amount of the loss. Such award shall be binding on you and us.

Each party will pay its own appraiser and bear the other expenses of the appraisal and umpire equally.

(Dkt. No. 5, Exh. I).

Pursuant to these terms, Plaintiff selected James Ward to serve as his appraiser and Allstate named Medeiros. (Dkt. No. 5, Exhs. A-C). Ward and Medeiros selected Paul Poncio to serve as umpire. (Dkt. No. 5, Exh. C). The appraisers inspected the property and exchanged estimates of Plaintiff's total amount of loss. See (Dkt. No. 15, Exhs. C, G). Ward provided an estimate of $56,881.88 and Medeiros calculated the damages at $423.76. Id. In a letter dated March 11, 2013, Plaintiff through counsel attempted to withdraw from the appraisal process on the basis that Allstate had breached the appraisal clause requirement that it select a "competent and independent" appraiser. (Dkt. No. 5, Exh. D). Counsel stated that Medeiros' estimate "completely failed to include costs for repair or replacement of obvious covered damage[s]." Id.Within days, on March 19, 2013, Plaintiff filed this suit. (Dkt. No. 1-5).

On April 10, 2013, Poncio rendered his decision, agreed to by Medeiros. (Dkt. No. 5, Ex. E). The decision set the total amount of loss at $9,795.30. Id. Allstate subtracted its prior payment and Plaintiff's deductible to reach a final award of $9,243.51, which was issued by check to Plaintiff, forwarded to counsel for Allstate, and then forwarded to Plaintiff's attorney on April 30, 2013. (Dkt. No. 5, Exs. F, G; Dkt. No. 15, Exh. E).

C. Analysis

1. Plaintiff's Request under Rule 56(d)

As an initial matter, the Court addresses Plaintiff's objection to the Motion as "premature," and his request under Rule 56(d) that the Court either defer its consideration of the Motion or allow Plaintiff additional time to conduct discovery on the arguments raised. (Dkt. No. 15); see FED. R. CIV. P. 56(d). The Court granted Plaintiff's unopposed request for an extension of time to file his response and also allowed the parties to mediate prior to issuing its ruling. See (Dkt. No. 12); 10/09/2013 Minute Entry. Therefore, Plaintiff's request for deferred consideration of the Motion is moot. See FED. R. CIV. P. 56(d)(1). Rule 56(d) requires that Plaintiff provide "specified reasons [why he] cannot present facts essential to justify his opposition" to summary judgment absent additional discovery. See FED. R. CIV. P. 56(d)(2). Plaintiff's statement, without more, that he needs to obtain the claim file in order to fully respond to the Motion, does not satisfy this standard. (Dkt. No. 15). Moreover, for the reasons explained herein, the claim file would not aid Plaintiff in overcoming Allstate's argument that its payment of the appraisal award disposes of Plaintiff's claims as a matter of law. (Dkt. No. 15). Accordingly, the Court must deny Plaintiff's request for more time to conduct discovery on the issues raised by the Motion.

2. Whether Plaintiff May Withdraw from Appraisal Process

Whether the appraisal award precludes Plaintiff's claims in part turns on whether Plaintiff is bound by that award, a question Allstate asks the Court to resolve in its favor. (Dkt. No. 5). In support of its argument that the award is binding on Plaintiff, Allstate points to the Texas Supreme Court's recognition of a "strong policy in favor of enforcing appraisal clauses in insurance contracts regardless of...