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Texas Court of Appeals Reverses the Trial Court. Plaintiff Takes Nothing.

American Alternative Insurance Corporation, Glatfelter Claims Management
July 14, 2014

The accident.

On December 29, 2011, Robert Davis was driving a wrecker owned by his business, J&D Towing L.L.C., when he was involved in an accident with a vehicle driven by Cassandra Brueland. It was undisputed Brueland was at fault for the accident and the wrecker was rendered a total loss.

The lawsuit.

Davis and his insurer, American Alternative Insurance Corp., were unable to agree on the amount of covered losses, and Davis sued American Alternative for breach of contract. The case was tried on the sole issue of the amount of J&D’s damages for the loss of use of the wrecker. Davis testified he could not afford a replacement wrecker and was unable to secure a replacement until the second week of March 2012, resulting in a four-month period of business interruption.The jury returned a verdict in favor of Davis in the amount of $28,000. The trial court reduced the verdict to $22,500 and entered judgment. American Alternative appealed.

The appeal.

The court of appeals cited the Texas Supreme Court and held the proper measure of damages in a total-loss case as the fair market value of the property at the time it was destroyed. The court then declined to hold the measure of damages as extending to include lost of use. As a result, it found that the trial court abused its discretion in submitting to the jury a question authorizing loss-of-use damages in this total-loss case.

Pursuant to this finding, the appeals court reversed the trial court and rendered judgment that J&D take nothing in the action.  

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