COURT OF APPEALS AFFIRMS SUMMARY JUDGMENT FINDING INSURED FAILED TO PRODUCE EVIDENCE THAT LOSS OCCURRED DURING POLICY PERIOD

Last week, the Court of Appeals of Texas, Corpus Christi, affirmed summary judgment in favor of Texas Farm Bureau Underwriters on the grounds that there was no evidence that the loss occurred during the policy period. In Schrader v. Texas Farm Bureau Underwriters, No. 13-17-00309-CV, 2018 WL 1633575 (Tex. App.—Corpus Christi, April 05, 2018, mem. op.), two of Schrader’s farming tractors were stolen sometime between November 30, 2013 and December 13, 2013 –  according to Schrader’s affidavit testimony.  The farming tractors were insured under a policy with Texas Farm Bureau Underwriters (“TFB”) until the policy was cancelled effective 12:01 a.m. on December 05, 2013 due to Schrader’s failure to pay the premium.  Schrader made a claim for his stolen tractors, which was denied by TFB on the grounds that the policy was not in force for the date of loss.  Schrader subsequently sued TFB for refusing to cover the losses.  TFB moved for traditional and no-evidence summary judgment, which the trial court granted. 

On appeal, Schrader argued that a lapse in coverage on December 05, 2013, did not entitle TFB to summary judgment because his affidavit testimony, in which he stated that he last saw the tractors on November 30, 2013 and the tractors were stolen sometime between that day and December 13, 2013, created a fact issue as to whether his loss occurred before the policy was cancelled.  The court disagreed and affirmed summary judgment.  The court relied on the rule that “an inference is not reasonable if it is based only on evidence that is susceptible to multiple, equally probable inferences, requiring the factfinder to guess in order to reach a conclusion.”  With the rule in mind, the court reasoned that although Schrader’s statement may [have] support[ed] a finding that the tractors were stolen sometime between November 30 and December 13, it [did] not support a reasonable inference that the tractors were stolen before 12:01 a.m. on December 5, because it [was] at least equally probable that the tractors were stolen after that time. The court further reasoned that Schrader’s affidavit testimony did “no more than create a mere surmise or suspicion that the tractors were stolen during the policy period.”   Accordingly, the court held that Schrader did not produce more than a scintilla of evidence supporting his claim that the loss occurred during the policy period, and that summary judgment was proper on that basis.