Last week, the Fourteenth Court of Appeals in Houston, Texas, conditionally granted a writ of mandamus and overturned the trial court’s denied abatement in In re Allstate Indemnity Co., No. 14-18-00362, 2018 WL 3580644 (Tex. App.—Houston [14th Dist.], Jul. 26, 2018) (mem. op.). The underlying case was a first party action where Holly Holt and David Cabrera sued Allstate for disputed amounts relating to damage to their condominium from Hurricane Harvey. Plaintiffs’ suit included causes of action for breach of contract, fraud, violations of the DTPA and Chapter 541 of the Texas Insurance Code. Allstate filed a plea in abatement claiming Plaintiffs failed to provide pre-suit written notice in accordance with the Texas Insurance Code. In response, Plaintiffs alleged they provided adequate notice and requested attorney’s fees and sanctions for having to respond to the plea. The trial court denied Allstate’s plea and awarded Plaintiffs $2,500 in attorney’s fees. Allstate filed a petition for writ of mandamus asserting the trial court abused its discretion in denying the plea and assessing sanctions.

The Court of Appeals noted that Texas Insurance Code Section 542A requires the claimant, no later than the 61st day before the date a claimant files an action under the chapter, to give written notice providing: (1) a statement of the acts or omissions giving rise to the claim; (2) the specific amount alleged to be owed by the insurer; and (3) the amount of reasonable and necessary attorney’s fees incurred by the claimant. Reviewing Plaintiffs’ letter and emails they alleged constituted notice to Allstate, the Court concluded that the writings failed to comply with Section 542A. Accordingly, the Court concluded that the trial court abused its discretion in denying Allstate’s plea in abatement and therefore the assessed sanctions were unsupportable.

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