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SCOTTSDALE INSURANCE COMPANY, Appellant,

SAMUEL M. TIPTON AND BARBARA M. TIPTON, Appellees.

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Opinion

Appellees, Samuel M. Tipton and Barbara M. Tipton, sued appellant, Scottsdale Insurance Company, for breach of contract, breach of the duty of good faith and fair dealing, and violations of the Texas Deceptive Trade Practices Act and the Texas Insurance Code after Scottsdale refused to pay appellees' entire claim under a fire insurance policy. Both sides filed motions for partial summary judgment on the issues of coverage and proceeds owed. The trial court granted appellees' motion and denied Scottsdale's motion, and issued an order awarding the Tiptons, inter alia, statutory damages for Scottsdale's violation of the Texas Insurance Code. Because we hold that the order purporting to grant summary judgment was interlocutory, we dismiss this action for want of jurisdiction.

On January 24, 1994, the Tiptons conveyed a parcel of land with a house and a store to Beverley and Joshua Ejiniwe. The Ejiniwes paid $25,000 down and executed a note to the Tiptons for $125,000, the remainder of the purchase price. The note was secured by a deed of trust on the property. The Ejiniwes obtained fire insurance coverage on the property from Scottsdale, with the policy to expire on February 15, 1996. The Ejiniwes defaulted on the note in November of 1995. The Scottsdale insurance policy was renewed for one year effective February 14, 1996,⁽²⁾ providing $75,000 coverage on the store building, $20,000 on the store contents, and $5,000 for debris removal. "Bev's Beach Store" and the Ejiniwes were listed as the named insureds and the Tiptons were listed as the lender loss payees.

After the Ejiniwes failed to cure the default, the Tiptons sent a notice of acceleration and notice of foreclosure in March of 1996, and the property was sold at a foreclosure sale on April 4, 1996. The Tiptons repurchased the property with a bid of $116,000; the deficiency balance was $8,164.22.

Shortly after repurchasing the property, Mrs. Tipton called her insurance agent, Hilb, Rogal & Hamilton Co. ("HRH"), to obtain insurance on the house and store located on the property. The policy for the house was reissued in the Tiptons' names, but a new commercial policy was never issued on the store.

On May 20, 1996, the store and its contents were destroyed by fire. The Tiptons filed a claim with Scottsdale for the full amount of the loss. In October, 1996, Scottsdale tendered payment equaling the deficiency amount. The Tiptons rejected the tender and filed suit against Scottsdale and HRH. The Tiptons pleaded causes of action for breach of contract, breach of the duty of good faith and fair dealing, and violations of the Texas Deceptive Trade Practices Act and the Texas Insurance Code. The Tiptons filed a motion for partial summary judgment:

on the issue of insurance coverage, and their entitlement to recover the entire policy proceeds available because of the fire loss in question; this Motion is a Partial Motion, because it does not deal with the Plaintiff's [sic] allegations concerning extra contractual liability, arising from the Defendant's breach of contract and bad faith conduct.

Scottsdale filed its own "Motion for Partial Summary Judgment as to Plaintiffs' Breach of Contract Claims." The trial court denied Scottsdale's motion and granted the Tiptons' motion. The trial court granted the Tiptons a judgment against Scottsdale in the following amounts:

(a) the insurance policy benefits of $99,500,

(b) pre-judgment interest of $35,820 (at the rate of ten percent),

(c) a penalty of $35,820 (eighteen percent under article 21.55(6) of the Texas Insurance Code),⁽³⁾

(d) attorney's fees of $39,800 (forty percent of the insurance policy proceeds), and

(e) court costs of $170.

The judgment totaled $198,191.66 and accrued post-judgment interest at the rate of ten percent per annum. In the same order, the trial court severed the Tiptons' cause of action against HRH under a separate cause number, and also severed their cause of action against Scottsdale for "bad faith liability" under a third cause number. The order denied "all further relief sought by either party."

In its fourth point of error, Scottsdale contends the trial court erred in awarding the statutory penalty prescribed by the Texas insurance code for an insurer's failure to promptly pay a claim because the Tiptons did not ask for such relief in their motion for partial summary judgment.

The Texas Insurance Code provides for the award of a penalty of "18 percent per annum of the amount of such claim" for an insurer's failure to promptly pay a valid claim. Tex. Ins. Code Ann. art. 21.55, §6 (Vernon Supp. 2001). In their motion for partial summary judgment, the Tiptons asked the trial court:

to enter a Judgment on the issue of insurance coverage, and their entitlement to recover the entire policy proceeds available because of the fire loss in question; this Motion is a Partial Motion, because it does not deal with the Plaintiff's allegations concerning extra contractual liability, arising from the Defendant's breach of contract and bad faith conduct.

Plaintiffs pray that the Court grant this Motion and enter Partial Summary Judgment in their favor, finding and holding that Plaintiffs are entitled to recover all of the policy proceeds from the insurance policy in question, and leaving for trial on the merits the issues of whether or not Plaintiffs have suffered extracontractual damages for which they are entitled to recover.

The Tiptons clearly asked only for summary judgment on the coverage, or breach of contract, issue; they did not ask the trial court for summary judgment on any insurance code violation. Similarly, Scottsdale did not move for summary judgment on any insurance code issue.

A motion for summary judgment shall state the specific grounds therefor. Tex. R. Civ. P. 166a(c). A motion for summary judgment must expressly state the grounds upon which it is made. McConnell v. Southside Indep. Sch. Dist., 858 S.W.2d 337, 341 (Tex. 1993). A motion for summary judgment must stand or fall on the grounds expressly presented in the motion and a court may not rely on briefs or summary judgment evidence in determining whether grounds are expressly presented. Id. A summary judgment may not be granted on grounds which are not raised by the movant in his motion. Mitre & Canseco v. Brooks Fashion Stores, 840 S.W.2d 612, 616-17 (Tex. App.--Corpus Christi 1992, writ denied). Here, the trial court's award of the statutory penalty clearly exceeded the scope of the relief requested.

C. Jurisdiction

Under Texas procedure, appeals are allowed only from final orders or judgments. Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 272 (Tex. 1992); North East Indep. Sch. Dist. v. Aldridge, 400 S.W.2d 893, 895 (Tex. 1966). A judgment that actually disposes of every remaining issue in the case is not interlocutory merely because it recites that it is partial or refers to only some of the parties or claims. Lehmann v. Har-Con Corp., Nos. 99-0406 and 990461, 2001 Tex. LEXIS 6, *41-*42 (Tex. Feb. 1, 2001). However, the inclusion of a Mother Hubbard clause ("all relief not granted is denied") does not automatically indicate that a judgment rendered without a conventional trial is final for purposes of appeal. Id. at *41-*42 (overruling Mafrige v. Ross, 866 S.W.2d 590, 591-92 (Tex. 1993), "to the extent it states otherwise"). It may be necessary for the appellate court to look to the record in the case to determine whether an order disposes of all pending claims and parties. Id. at *49.

A judgment that grants more relief than a party is entitled to is subject to reversal, but it is not, for that reason alone, interlocutory. Lehmann, 2001 Tex. LEXIS 6 at *29; Continental Airlines, Inc. v. Kiefer, 920 S.W.2d 274, 276-77 (Tex. 1995); Young v. Hodde, 682 S.W.2d 236, 237 (Tex. 1984)(per curiam); Chessher v. Southwestern Bell Tel. Co., 658 S.W.2d 563, 564 (Tex. 1983)(per curiam); Schlipf v. Exxon Corp., 644 S.W.2d 453, 454-55 (Tex. 1983)(per curiam). If a judgment grants more relief than requested, it should be reversed and remanded, but not dismissed. Lehmann, 2001 Tex. LEXIS 6 at *35-*36.

In the instant case we have a separate jurisdictional problem. Although the order granting summary judgment purports to sever the Tiptons' cause of action against Scottsdale for "bad faith liability," the order also grants the Tiptons damages for violation of the Texas Insurance Code, which should be part of the bad faith action. Under the new approach to determining the finality of summary judgments announced in Lehmann, there must be some "clear indication that the trial court intended the order to completely dispose of the entire case." Id. at *48.

Here, we have a purportedly final order that contradicts itself. It awards the Tiptons bad faith damages against Scottsdale, but also purports to sever the Tiptons' bad faith cause of action against Scottsdale. We conclude that, under the rationale of Lehmann, the trial court's order is not final because it does not make a clear disposition of all causes of action. See id. at *48. Accordingly, we hold that the order is interlocutory.

We dismiss this case for want of jurisdiction.

FEDERICO G. HINOJOSA

Justice

Do not publish. Tex. R. App. P. 47.3.

Opinion delivered and filed this

the 15th day of March, 2001.

1. Retired Chief Justice Robert J. Seerden, assigned to this Court by the Chief Justice of the Texas Supreme Court pursuant to Tex. Gov't Code Ann. § 74.003 (Vernon 1998).

2. The record is not clear whether the Ejiniwes or the Tiptons paid the premium for this policy.

3. Tex. Ins. Code Ann. art. 21.55(6) (Vernon Supp. 2001).