ORAL AGREEMENT TO DELAY SERVICE INADEQUATE TO AVOID STATUTE OF LIMITATIONS DEFENSE – SUMMARY JUDGMENT GRANTED

Last Thursday, the Corpus Christi Court of Appeals affirmed summary judgment in favor of the insured based on the claimant’s failure to exercise due diligence in serving the lawsuit, despite an alleged oral agreement with the insured’s adjuster that service was not necessary while settlement negotiations continued. In Jones v. Coleman, 2020 WL 3116498 (Tex. App. – Corpus Christi – Edinburg June 11, 2020), Jones, with the help of his pastor, presented a claim against Coleman through Coleman’s insurer Progressive. The day before the two-year statute of limitations was to expire, Jones filed a pro se petition and was told by his pastor that no service was needed based on a discussion with an unnamed claim adjuster for Progressive. But nothing was in writing.

Jones hired an attorney six-months later, and it took another six-months to serve the insured with the lawsuit. Service only took place after the claimant’s attorney sent a demand letter and the Progressive adjuster said they would need to for them to serve the insured to continue discussions. An answer was filed and included a statute of limitations defense, which arises when a claimant files suit untimely, or timely files and fails to exercise due diligence in serving the defendant. The insured moved for summary judgment based on the claimant’s failure to exercise due diligence in perfecting service, which was granted by the trial court.  This appeal followed.

On appeal, the court noted that when a defendant pleads the defense of limitations and shows service was untimely, the burden shifts to the plaintiff to prove diligence in attempting service. In this case, “Coleman was served thirteen months after limitations expired, approximately eight months after Jones hired counsel, and three months after Progressive told counsel she would not discuss the case until Coleman was served.” The court then focused on the alleged oral agreement with an “unnamed adjuster” observing that “oral agreements are insufficient to toll limitations” they must be in writing. And the length of the delay reflected a lack of due diligence as a matter of law. Accordingly, summary judgment in favor of the insured was affirmed.