SOUTHERN DISTRICT OF TEXAS ALLOWS CORPORATE DEPOSITIONS FOR UIM DAMAGE INFORMATION

Last week, the Texas Court of Appeals in Tyler allowed an Insurance company’s corporate representative deposition in an underinsured motorist (UIM) claim despite the insurance company stipulating most of the issues in the case.

James Hanna’s vehicle was struck by Arturo Aguirre’s vehicle, then Hanna settled with Hanna and his liability carrier for its policy limits.  However, Hanna also filed a claim with Central Mutual, his own insurance company, for UIM benefits.  Central stipulated that Hanna was insured with UIM limits of $100,000; Hanna was in an accident that Aguirre caused; and Aguirre settled with Hanna for $30,000.  Central’s amended Answer asserted the affirmative defense that Hanna failed to mitigate his damages—thus bringing the amount of damages into dispute.  Hanna accordingly sought Central’s corporate representative deposition, claiming he was entitled to obtain discovery regarding Central’s calculation of his damages.  Central quashed the deposition, and the trial court—and ultimately the Tyler Court of Appeals—denied the motion to quash.  The Courts held that UIM causes of action inherently involve a determination of the amount of damages.  With the amount of damages as an issue in the case, and parties allowed discovery on any relevant issue in a case, Hanna was entitled to the deposition of the corporate representative on this issue.  Notably, the Courts disagreed with Central’s arguments that this was privileged information and unduly burdensome, and it was not determinative that there were more convenient and less expensive means of obtaining information/discovery on this issue.