In re Liberty County Mutual Insurance Co.
537 S.W.3d 214
Tex. App.2017Background
- May 2014 auto accident: Latrisha Morris injured when hit by Amitbhali Momim; Morris had a Liberty Mutual policy with uninsured/underinsured motorist (UIM) coverage.
- Morris sued Momim and Liberty Mutual (May 2016), asserting Momim’s negligence and seeking a declaratory judgment and extra-contractual claims against Liberty Mutual for failing to pay UIM benefits.
- Trial court severed and abated Morris’s extra-contractual claims against Liberty Mutual, leaving only breach of contract/declaratory judgment (coverage) claims pending.
- Morris served broad discovery seeking Liberty Mutual’s claim-handling files, claims history, policies, similar lawsuits, and deponent Marianne Cagle’s testimony (the claims adjuster who verified responses).
- Liberty Mutual objected as premature/irrelevant because contractual liability for UIM benefits does not arise until underlying liability and damages against the tortfeasor are resolved, and moved to quash Cagle’s deposition; the trial court denied the motion and ordered the deposition.
- Liberty Mutual sought mandamus relief; the appellate court concluded the deposition sought matters irrelevant to the pending issues and conditionally granted the writ directing the trial court to quash the deposition order.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether depositions/discovery about insurer’s claim-handling and history are discoverable before underlying tort liability/damages resolved | Morris: a witness who verifies discovery responses (Cagle) is discoverable; discovery responses justify deposition | Liberty: insurer not liable until liability/damages adjudicated; such discovery is irrelevant and seeks abated extra-contractual matters | Held: Discovery about claim-handling, history, policies, and Cagle’s deposition is irrelevant at this stage; trial court erred and must quash the deposition order |
| Whether insurer must submit to deposition simply because an employee verified interrogatory responses | Morris: verification makes the agent a proper deponent | Liberty: verification alone is insufficient; only limited, relevant testimony exists (e.g., confirming records produced) | Held: Verification is insufficient to compel deposition where the substance sought is irrelevant or duplicative |
| Whether medical-record-related testimony by insurer’s verifier is proper | Morris: medical records linked to damages; verifier can testify about what insurer received | Liberty: plaintiff has superior access to her own records; deposing verifier would be duplicative and burdensome | Held: Verifier testimony about medical records is duplicative and unduly burdensome; plaintiff may use direct sources instead |
| Whether mandamus is appropriate (adequate remedy by appeal) | Morris: appeal is available | Liberty: appeal inadequate because order compels production of patently irrelevant discovery and imposes disproportionate burden | Held: Mandamus appropriate; insurer lacks adequate remedy by appeal when compelled to produce irrelevant/duplicative discovery |
Key Cases Cited
- Brainard v. Trinity Universal Ins. Co., 216 S.W.3d 809 (Tex. 2007) (UIM insurer’s contractual duty to pay does not arise until liability and damages are determined)
- In re Progressive County Mut. Ins. Co., 439 S.W.3d 422 (Tex. App.—Houston [1st Dist.] 2014) (discovery of insurer’s claim-handling history is improper before underlying liability resolved)
- In re CSX Corp., 124 S.W.3d 149 (Tex. 2003) (discovery must be reasonably tailored and relevant; appellate review of discovery orders)
- Walker v. Packer, 827 S.W.2d 833 (Tex. 1992) (mandamus standard: clear abuse of discretion and no adequate appellate remedy)
- In re United Fire Lloyds, 327 S.W.3d 250 (Tex. App.—San Antonio 2010) (abatement of extra-contractual claims pending resolution of breach of contract/coverage issues)
- In re Am. Optical, 988 S.W.2d 711 (Tex. 1998) (trial court must impose reasonable limits on discovery)
- In re Allstate Cnty. Mut. Ins. Co., 447 S.W.3d 497 (Tex. App.—Houston [14th Dist.] 2014) (extra-contractual claims must be severed/abated until coverage liability is determined)