in Re Usaa General Indemnity Company
624 S.W.3d 782
Tex.2021Background
- Frank Wearden (insured) sued USAA for uninsured/underinsured motorist (UIM) benefits after a 2013 accident with Michelle Bernal; Wearden settled with Bernal and asserted only contractual coverage claims (no bad‑faith claims).
- USAA conceded coverage exists (policy, scheduled vehicle, $100,000 UIM limit) but disputed Bernal’s liability and the existence/amount of Wearden’s damages; it asserted conditions‑precedent and offset defenses.
- Wearden noticed a corporate‑representative deposition under Tex. R. Civ. P. 199.2, ultimately identifying nine topics (policy, conditions precedent, defenses, valuation of damages, whether Bernal was underinsured, offsets, etc.) and served a subpoena for related claim reports.
- USAA moved to quash, arguing its employees lack personal knowledge, the deposition is cumulative/obtainable from other sources and disproportionate, and the topics are overbroad; the trial court denied the motion and the court of appeals denied mandamus relief.
- The Texas Supreme Court held a UIM carrier’s corporate representative may be deposed on matters bearing on the disputed liability and damages issues, but limited the deposition’s scope and granted mandamus relief in part to exclude impermissible topics.
Issues
| Issue | Plaintiff's Argument (Wearden) | Defendant's Argument (USAA) | Held |
|---|---|---|---|
| Whether deposition of defendant carrier’s corporate representative is categorically barred because its employees lack personal knowledge | Party has right to depose opposing party; carrier may possess relevant (even second‑hand) information about disputed liability/damages | Lack of personal, first‑hand knowledge means representative has no relevant testimony | Not categorically barred; Rule 192.3(c) permits discovery of matters a party "has or may have" even if not first‑hand, so deposition can be proper when tied to disputed issues |
| Whether Rule 192.4 proportionality forbids the deposition as unreasonably cumulative or burdensome | Deposition is a permissible discovery method; rules do not mandate a discovery sequence | Deposition would be cumulative of other sources (witnesses, police report, medical records) and more burdensome than written discovery | Proportionality may bar a deposition in some cases, but USAA failed to present evidentiary support here; on this record deposition is not disproportional though burden/duplicative concerns limit scope |
| Proper scope of corporate‑rep deposition (which topics are allowed) | Seeks defendant’s contentions and any information USAA possesses relevant to liability/damages | Topics are overbroad; some subjects (policy terms, offsets, claims handling, insured’s own records) exceed the "car crash" issues | Deposition limited to matters bearing on disputed liability and damages and non‑privileged information USAA possesses; topics seeking general policy terms, all conditions precedent, insured’s own records, offsets (premature), and claims‑handling/process are improper |
| Whether trial court’s denial of quash is reviewable via mandamus | Parties should be able to obtain discovery; trial court followed controlling precedent | Denial forces party to undergo burdensome, improper discovery without adequate appellate remedy | Mandamus relief available where trial court orders discovery that exceeds rules; relief granted in part to vacate the order as to impermissible topics |
Key Cases Cited
- Brainard v. Trinity Universal Ins. Co., 216 S.W.3d 809 (Tex. 2006) (UIM coverage depends on judicial determination of liability and damages)
- In re CSX Corp., 124 S.W.3d 149 (Tex. 2003) (trial court abuses discretion by ordering discovery beyond procedural rules)
- In re State Farm Lloyds, 520 S.W.3d 595 (Tex. 2017) (proportionality standard and need for evidentiary support for proportionality objections)
- In re Prudential Ins. Co. of Am., 148 S.W.3d 124 (Tex. 2004) (mandamus requires showing of abuse of discretion and lack of adequate appellate remedy)
- In re Alford Chevrolet‑Geo, 997 S.W.2d 173 (Tex. 1999) (proportionality objections must be supported with evidence)
- In re Am. Optical, 988 S.W.2d 711 (Tex. 1998) (discovery must be reasonably tailored to relevant matters)
- In re Liberty Cnty. Mut. Ins. Co. (Liberty I), 537 S.W.3d 214 (Tex. App.—Houston [1st Dist.] 2017) (UIM coverage trial resembles typical car‑wreck liability/damages dispute)
- In re Liberty Cnty. Mut. Ins. Co. (Liberty II), 557 S.W.3d 851 (Tex. App.—Houston [14th Dist.] 2018) (corporate‑rep deposition may be improper if information already obtained or obtainable elsewhere)
- In re Liberty Cnty. Mut. Ins. Co. (Liberty III), 606 S.W.3d 866 (Tex. App.—Houston [14th Dist.] 2020) (insured entitled to depose carrier about defenses on fault and damages when carrier hasn’t shown information available elsewhere)