USAA Texas Lloyds Co. v. Menchaca

1. This case is based on a special verdict form. I think it would be helpful for you to see it.

Three jury questions and answers are relevant here. Jury Question 1, which Menchaca insisted upon submitting despite the trial court’s concerns and later urged the trial court to disregard,¹relates to contractual liability:

1. Did USAA Texas Lloyd’s Company (“USAA”) fail to comply with the terms of the insurance policy with respect to the claim for damages filed by Gail Menchaca resulting from Hurricane Ike?

Answer “Yes” or “No”.

Answer: NO

In answering “no,” the jury thus rejected Menchaca’s assertion that USAA breached the policy.

Jury Question 2 relates to extra-contractual liability and provided a list of potential statutory violations:

2. Did USAA engage in any unfair or deceptive act or practice that caused damages to Gail Menchaca?

Answer “Yes” or “No” as to each subpart.

“Unfair or deceptive act or practice” means any one or more of the following:

A. Failing to attempt in good faith to effectuate a prompt, fair, and equitable settlement of a claim when the liability under the insurance policy issued to Gail Menchaca had become reasonably clear; or

Answer: NO

B. Failing to promptly provide to Gail Menchaca a reasonable explanation of the factual and legal basis in the policy for the denial of a claim(s); or

Answer: NO

C. Failing to affirm or deny coverage within a reasonable time; or Answer: NO

D. Refusing to pay a claim without conducting a reasonable investigation with respect to a claim(s); or

Answer: YES

E. Misrepresenting to Gail Menchaca a material fact or policy provision relating to the coverage at issue.

Answer: NO