Jennifer Martin (Partner-Dallas) and Tim Delabar (Associate-Dallas) obtained dismissal with prejudice of all claims in an insurance coverage and bad faith action arising from a first-party property claim. After the parties completed an appraisal and our client paid the appraisal award, the insureds and their contractor concluded the cost to repair the building was higher than anticipated. They filed suit against our client alleging that the appraisal should be set aside due to fraud or mistake and asserted causes of action for breach of contract, statutory bad faith under the Texas Insurance Code and DTPA, and violations of the prompt payment of claims statute, seeking more than $2 million in contractual damages, treble damages for bad faith, prompt payment penalty interest and attorney's fees. The plaintiffs' theory of liability was that our client's appraiser was acting as its agent for purposes of the appraisal. Jennifer and Tim filed a motion to dismiss arguing to the federal court that, as a matter of law, an appraiser is not an agent and that the plaintiffs failed to plead any facts that would suggest the appraiser in this case was operating in a dual role. They successfully argued that the court could consider emails by the appraisal panel, even though the emails were not attached to the plaintiffs' complaint, because they were referenced in the complaint and central to the plaintiffs' claims. The district court's order relied heavily on these emails in granting judgment for our client. Ultimately, the federal court dismissed all claims with prejudice before the parties engaged in written discovery and before our client incurred significant defense costs. Plaintiffs did not appeal.
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