Last Wednesday evening, a jury in Fort Bend County (southwest of Houston) determined that Safeco did not breach its insurance policy with a homeowner but the homeowner failed to comply with his obligations under the policy in the trial of Tasneem and Mohammed Khan vs. Safeco Surplus Lines and Crawford & Co in the 240th Judicial District Court of Fort Bend County.  This decade-old mold claim arose during the height of the Texas mold crisis under a forced-placed policy through the homeowners’ mortgage company, Option One.  The claim was investigated and the carrier paid more than $80,000 on ten different claims involving water intrusions into the large home in Sugarland.  Unhappy with the claim payments, the homeowners sued the property insurer Safeco, the independent adjusting company (Crawford) and an engineer hired by Crawford to investigate the house in question.  Emotions ran high in the case with allegations early that mold in the home caused the death of one of the homeowners’ children.  Safeco defended by claiming that its claim payments were sufficient to repair all water damage and resulting mold but the insured chose to spend that money paying his past due mortgage payments and buying new clothes. Safeco also alleged the homeowner failed to provide it with alternative repair estimates which the homeowner alleges he mailed after his claim was adjusted.  The homeowners were ultimately represented by seven different lawyers and firms.

Safeco filed three different motions seeking to have all of the claims dismissed based on the Texas Supreme Court’s decision in Fiess v. State Farm holding that mold isn’t covered under Texas homeowners policies. All three motions were denied by the court forcing Safeco and Crawford to the try a plethora of contractual and extra-contractual claims arising from the 2002 water events and the corresponding mold that allegedly destroyed the home.  At the end of the second week of trial, the jury determined that Safeco did not breach its insurance policy, the homeowners did fail to comply with their duties under the policy, and neither Crawford nor its engineer engaged in any unfair or deceptive acts or practices.  None of the other extra- contractual questions were answered because of the jury’s answers to the earlier questions.

Chris Martin and Chris Avery of our firm had the privilege of representing Safeco in this trial.  We appreciate the courage of Safeco in its willingness to take this decade-old case to trial and achieve the vindication of its handling of these claims.  Crawford and its engineer were represented by Curtis Collette and Russell Ramsey of Ramsey & Murray in Houston.  Congratulations to Crawford and our co-counsel for their success as well.

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