Insurance Law Section
ILS Events Calendar

Jun

7

Insurance Law Section Council Meeting (San Antonio)

4:30pm - 6:00pm Hyatt Regency Hill Country Resort & Spa, San Antonio, TX

Jun

8

14th Annual Advanced Insurance Law Course

June 8-9, 2017 @ Hyatt Hill Country Resort & Spa in San Antonio, Texas (More)

To Protect Itself, Insurer Must Consider Agency Principles Before Issuing Payment to Joint Payees
by Eric Scott Peabody

Insurers frequently issue checks to multiple payees – usually to some combination of the insured, adjuster/third-party administrator, mortgagee or lienholder, and attorneys.  Carriers had long considered themselves protected when issuing payment to joint payees by simply including all payees on the check; if a bank cashed the check without the signature of all payees – or with the forged signature of a payee – liability for that error rested squarely with the bank. See, e.g., Benchmark Bank v. State Farm Lloyds, 893 S.W.2d 649, 651 (Tex. App.–Dallas 1994, no writ) (payment to joint payees discharged obligation under policy). But a set of 2014 opinions from the Texas Supreme Court and the Dallas Court of Appeals created significant uncertainty for insurers on this issue.  McAllen Hospitals, L.P. v. State Farm County Mutual Insurance Co. of Texas, 433 S.W.3d 535 (Tex. 2014); ViewPoint Bank v. Allied Property & Casualty Ins. Co.,439 S.W.3d 626 (Tex. App.–Dallas 2014, pet. denied).  In McAllen Hospitals, the court held that an insurer’s checks issued jointly to patients and a hospital (which had given notice of its liens pursuant to the Texas Hospital Lien statute) did not discharge its payment obligation to the hospital when the patients deposited the checks without obtaining the hospital’s endorsement.  433 S.W.3d at 540-41.  The court appli...(Continue)

 
 
Section News
14th Annual Advanced Insurance Law Course

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Recent Decisions
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Court denies Motion to Remand and finds that joinder of adjuster was improper due to boilerplate factual allegations
Court Overturns Its Precedent  
Chicas v. Texas Mutual Insurance Co. Tx 1-Houston 5/16/17—
The court has rejected its prior holding that Section 410.252 of the Texas Labor Code is jurisdictional meaning that the deadline for filing a suit for review is tolled if the claimant files in the wrong court.
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