State Farm Mutual Automobile Insurance Co. v. Valdez
The court rejected the insurer's contention that the insured was not entitled to the $20,000 in attorney's fees' awarded by the trial court because the fees were unnecessary, based on the jury verdict entitling the insured to only $823 in Underinsured Motorist Coverage when the insurer had made a presuit offer of $5000 because: 1) there is a presumption that the fees were reasonable and necessary when the lodestar method is used to calculate fees and here, the insured's attorney had presented evidence that he had incurred more than $60,000 in fees in prosecuting the claim; 2) the Texas Supreme Court has made it clear that an insured is only entitled to UIM damages, if he establishes the tortfeasor's liability; 3) the insurer had filed a stipulation with the court saying that it intended to pay UIM benefits if the insured showed through judicial determination that he was entitled to UIM benefits; and 4) to accept the insurer's argument would penalize the insured for rejecting a pre-suit settlement offer.
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