Sanctions Against Insurer Sought After Fatal Crash

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Written By: John Council

The plaintiffs in a gross negligence case are taking aim at a major insurance company by adding it as a defendant in their petition, alleging that the company’s captive counsel misstated the law to a state district court to avoid covering a fatal, police-involved car crash.

The background to the case, according to the Sept. 16 fourth amended petition inShawn Williams Sr., et al. v. The City of Baytown, et al., which is pending in Harris County’s 127th District Court, is as follows.

On Oct. 19, 2012, Shawn Williams Jr. and Shay Hollingshead were waiting at a stop light when a shoplifter fleeing Baytown police officers hit their car. While Hollingshead survived the crash with severe injuries, Williams died after the car in which he was trapped “erupted in a ball of fire” the petition alleges.

Hollingshead and Williams’ survivors retained a lawyer Dec. 4, 2012, and sent a letter of representation to Progressive County Mutual Insurance Co. Progressive insured the driver who fled police and allegedly caused the wreck. On March 20, 2013, a claims adjuster for Progressive notified the plaintiffs that there was no coverage for the accident, the petition alleges.

The plaintiffs allege they later discovered that, without notice to them and in violation of Texas Civil Practice & Remedies Code §37.006, Progressive had obtained a default judgment in Harris County’s 334th District Court, which found that there was no coverage for the accident.

To win the default judgment, the plaintiffs continue, Progressive had alleged in the declaratory judgment action that its insured’s policy excluded coverage for damages that result from felonious conduct. The contention that the policy excluded coverage is a direct contravention of a 2009 Texas Supreme Court ruling in Tanner v. Nationwide Mutual Fire Insurance Co., according to the petition in Williams.

In Tanner, the high court looked at a similar coverage dispute, in which an insurer attempted to avoid covering a car wreck caused by an insured fleeing the police. The court held that, to avoid coverage, the insurer had to prove that its insured purposefully intended to injure a claimant. However, the high court held that it is not enough to prove merely the insured’s conduct was intentional, the petition alleges.

There are policy reasons for the decision in Tanner, explained majority author Justice Don Willett in the opinion: “For example, Texas mandates liability for drivers, but if ordinary Texans are unprotected from those who intentionally speed or run red lights, but intend no harm to others by doing so, the Texas is replete with non coverage notwithstanding its mandatory-coverage requirement.”

And like in Tanner, the plaintiffs in Williams allege that Progressive’s insured was “certainly negligent” and was “in the act of committing a crime,” but “he did not begin his flight with the objective of killing Shawn Williams Jr. and severely injuring Shay Hollingshead.”

The petition alleges that Progressive’s captive counsel, Meynier, Nohinek, Loving & Matte, purposefully avoiding notifying the plaintiffs of the declaratory judgment action and misrepresented the facts and the law to a state district court. The petition also alleges that Progressive violated numerous provisions of the Texas Insurance Code that prohibits insurance companies from misrepresenting claims, among other things.

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