HOUSTON COURT OF APPEALS ORDERS SEVERANCE AND ABATEMENT OF EXTRA-CONTRACTUAL CLAIMS

June 17, 2014

The Houston First Court of Appeals conditionally granted a carrier’s writ of mandamus and ordered the carrier’s motion to sever extra-contractual claims from the breach of contract suit be granted, and the extra-contractual claims abated  in In Re Progressive County Mutual Insurance Company, No. 01-14-00199-CV (Tex.App.-Houston [1st Dist.] June 12, 2014.)

Following an automobile accident with an uninsured motorist and while investigation into the claim was ongoing, Guia sued her insurer, Progressive, for both breach of the uninsured motorist provisions in her policy and various extra-contractual claims.  Guia served numerous discovery request on Progressive, some of which were not relevant to the breach of contract claim. Progressive filed a motion to sever the breach of contract claims from the extra-contractual claims.  The court ordered the motion to sever abated and allowing discovery to move forward on all claims until the pretrial hearing.  Progressive filed a writ to compel the severance and abatement of the extra-contractual claims.

The Houston Court of Appeals recognized that severance has been required in cases where a carrier makes a settlement offer.  The severance was required in order to avoid prejudice in the breach of contract case.  In the instant case, there had not been any settlement offers.

The Houston Court of Appeals recognized that severance may be required in “other compelling circumstances.”  In the instant case, “other compelling circumstances” was found in avoiding discovery that was irrelevant to the breach of contract case.