Seim v. Allstate Tex. Lloyds

• Decision Date: 29 June 2018
• Docket Number: No. 17–0488,17–0488
• Citation: 551 S.W.3d 161
• Parties: Richard SEIM and Linda Seim, Petitioners, v. ALLSTATE TEXAS LLOYDS and Lisa Scott, Respondents
• Court: Texas Supreme Court

551 S.W.3d 161

Richard SEIM and Linda Seim, Petitioners,

v.ALLSTATE TEXAS LLOYDS and Lisa Scott, Respondents

No. 17–0488

Supreme Court of Texas.

OPINION DELIVERED: June 29, 2018

David P. Wilson, Beaumont, Chad T. Wilson, Webster, Andrew B. Bender, Houston, for Petitioners.

Clinton D. Howie, David G. Allen, Dallas, for Respondents.

PER CURIAM

Richard and Linda Seim purchased a homeowners' insurance policy from Allstate Texas Lloyds. A few months after the policy went into effect, the Seims filed a claim for storm damage, which Allstate denied. Allstate claims it denied the claim based on the results of a property inspection by one of its adjusters, Lisa Scott. Although the inspection revealed water damage, Allstate maintains the Seims' home lacked any damage attributable to wind or hail. And absent wind or hail damage, the policy provides no coverage. The Seims sued Allstate and Scott (collectively Allstate), asserting both contractual and extra-contractual claims.

Allstate moved for summary judgment on both traditional and no-evidence grounds. In its motion, Allstate contended the Seims have no evidence that they suffered a covered loss and that limitations bars their claims. The Seims filed their summary-judgment response seven days before the hearing date, as Rule 166a(c) requires. See TEX. R. CIV. P. 166a(c). But though their response referred to certain pieces of summary-judgment evidence, including an affidavit, the Seims failed to attach any evidence to their response. The only evidence the Seims provided was attached to an amended response they filed on the day of the summary-judgment hearing—without leave of court.

The Seims' late-filed evidence included two expert reports in which Neil Hall, a professional engineer, concluded that the Seims' home suffered damage during a hail storm in August 2013. In the first report, Hall opines:

Without reviewing all the file material for each individually reported date of loss, it is difficult to determine what part and how much of the roof assembly and radiant barrier were damaged by wind, hail and/or the ensuing penetration of water for each of the reported weather events. However, clearly some of the damage described by Mrs. Seim occurred prior to the August 13, 2013[,] date of loss.

In the second report, Hall states that after preparing the first report, he reviewed additional materials and now concludes that the damage he observed "resulted from the August 13, 2013[,] windstorm." Neither of Hall's reports was verified.

In addition to the reports, the Seims' evidence also included an affidavit by Hall. In it, Hall states that he has prepared two expert reports that he identifies by date and subject matter. He also attests "that all the facts stated in this Affidavit are true and accurate to the best of my knowledge." The affidavit concludes with a jurat and is stamped with the notary's seal, but the notary did not sign it.

Allstate objected in writing to the Seims' summary-judgment evidence on multiple grounds. Among these objections was that Hall's affidavit does not state that the facts and opinions in the reports are "true and correct." Instead, it states "that all the facts stated in this Affidavit are true and accurate." (Notably, besides stating that the property damage resulted from "a storm on August 13, 2013," the affidavit contains none of Hall's opinions about the cause of the damage—only the reports do.) Allstate also objected to the absence of the notary's signature and that the reports were not attached to the affidavit. Along with its objections, Allstate provided the trial court with two proposed orders, one granting the motion for summary judgment and the other sustaining the objections to the Seims' evidence. The trial court granted summary judgment for Allstate, but it neither signed the order sustaining Allstate's objections nor otherwise ruled on them. The order granting summary judgment reflected that the trial court considered the motion, briefs, "all responses, [and] all competent summary[-]judgment evidence." It did not, however, specify the grounds for its judgment.

The court of appeals affirmed the trial court's judgment for Allstate. No. 02-16-00050-CV, 2017 WL 1738028, at *6 (Tex. App.—Fort Worth May 4, 2017) (mem. op.). In so doing, it noted that the trial court had considered the Seims' late-filed response and evidence, and it did not overturn that decision. Id. at *5. But it held, nevertheless, that the Seims' only summary-judgment evidence was incompetent. Id. Hall's reports were not verified or authenticated, the court held, thus rendering them incompetent. Id.

Equally unavailing, the court concluded, was Hall's affidavit. Id. at *6. Because the reports were not attached to the affidavit and because the affidavit merely referred to the reports by date, the court held that it would have "to guess whether the reports referenced in [the] affidavit are the same as the reports attached to the summary[-]judgment evidence." Id. Moreover, the affidavit itself contained no explanation about how the August 2013 storm caused the Seims' property damage. Id. But most problematic, the court of appeals noted, was that Hall attested to the truth of only those statements within the affidavit rather than the statements in his reports. Id. So, the court held the record contained no sworn evidence that the Seims sustained their property damage during the policy period. Id. As the Seims had failed to proffer competent summary-judgment evidence that the property damage occurred during the insurance policy's term, the court of appeals upheld the summary judgment. Id.

After the court of appeals issued its opinion, the Seims moved for reconsideration en banc. Id. at *5 n.12. They contended the court of appeals had elevated a defect in form (the lack of verification) to a defect in substance. Id. And they further contended that Allstate failed to preserve its objections to the formal defects by neglecting to obtain an express ruling from the trial court. Id. The court of appeals denied the Seims' motion for en banc reconsideration but issued a substitute opinion in which it addresses the Seims' motion-for-rehearing arguments. In the corrected opinion, the court notes that summary-judgment evidence, including expert reports, must be verified. Id. And it concludes Allstate preserved its objections to the evidence by complaining that it is hearsay, requesting that it be stricken, and challenging it for lacking a notary's signature. Id. The Seims filed a petition for review with this Court.

The same evidentiary standards that apply in trials also control the admissibility of evidence in summary-judgment proceedings. United Blood Servs. v. Longoria , 938 S.W.2d 29, 30 (Tex. 1997) (per curiam). But the rules of error preservation also apply. See Mansions in the Forest, L.P. v. Montgomery Cty. , 365 S.W.3d 314, 317–18 (Tex. 2012) (per curiam). To preserve a complaint for appellate review, a party must (1) complain to the trial court by way of "a timely request, objection, or motion; and (2) the trial court must rule or refuse to rule on the request, objection, or motion." Id. at 317 ; TEX. R. APP. P. 33.1(a). And if purported summary-judgment evidence presents a defect in "form," that defect cannot provide "grounds for reversal unless specifically pointed out by objection by an opposing party with opportunity, but refusal, to amend." TEX. R. CIV. P. 166a(f).

Allstate objected to the Seims' summary-judgment proof in satisfaction of Rule 33.1(a) and Rule 166a(f). But unless Allstate complained of a defect in the evidence's substance, rather than its form, it was obligated not only to object but also to obtain a ruling on its objection. Mansions , 365 S.W.3d at 317 ; TEX. R. APP. P. 33.1(a)(2). Courts have held that even if a party objects to an opponent's summary-judgment evidence, the evidence "remains part of the summary[-]judgment proof unless an order sustaining the objection is reduced to writing, signed, and entered of record." Mitchell v. Baylor Univ. Med. Ctr. , 109 S.W.3d 838, 842 (Tex. App.—Dallas 2003, no pet.) ; see also Dolcefino v. Randolph , 19 S.W.3d 906, 927 (Tex. App.—Houston [14th Dist.] 2000, pet. denied) (assuming that error was not preserved so that statements were part of the summary-judgment evidence on appeal).

As noted above, Rule 33.1(a) requires a timely and ruled-upon objection to preserve error. TEX. R. APP. P. 33.1(a). In 1997, language was added to the rule providing that the trial court may rule on an objection "either expressly or implicitly." Id. 33.1(a)(2)(A) ; see also Trusty v. Strayhorn , 87 S.W.3d 756, 760 (Tex. App.—Texarkana 2002, no pet.) (noting the effective date of the amendment). This alteration to the preservation requirements created a divide among the courts of appeals over whether a trial court "implicitly" rules upon an objection to summary-judgment evidence just by ruling on the summary-judgment motion itself.

Shortly after the rule change, the Second Court of Appeals decided Blum v. Julian , 977 S.W.2d 819 (Tex. App.—Fort Worth 1998, no pet.), and Frazier v. Yu , 987 S.W.2d 607 (Tex. App.—Fort Worth 1999, pet. denied). Departing from years of precedent, the court relied on Rule 33.1's new language, construing it to mean a trial court "implicitly" rules upon objections in summary-judgment proceedings by ruling on the merits of the summary-judgment motion. The court detailed this analysis in Blum , reasoning that the new rule was a substantive revision to the prior elements of error preservation:

This addition relaxes the former requirement of an express ruling[ ] and is consistent with case law holding that an appellate court can presume the trial court overruled an objection in certain circumstances. See Salinas v. Rafati , 948 S.W.2d 286, 288 (Tex. 1997) (finding that granting of motion to disregard "automatically" denied motion for judgment on verdict); Acord v. General Motors Corp. , 669 S.W.2d 111, 114 (Tex. 1984) (

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