FANNING, HARPER & MARTINSON, P.C.

NEWS

MARCH 2002

As a continuing service to our clients, we have summarized recent cases for you. Legal topics include:

MUNICIPAL LAW UPDATE,

PREMISES LIABILITY UPDATE,

CLASS ACTION UPDATE,

PRODUCTS LIABILITY UPDATE,

EMPLOYMENT LAW UPDATE, and

INSURANCE COVERAGE & BAD FAITH UPDATE.

For convenience, each of these topics is presented as a separate category. These abbreviated summaries are provided for information only, and are not intended as legal advice.

At Fanning, Harper, & Martinson, we use every method available to achieve success for our clients. Of course, this includes winning jury trials. Success also comes by successfully pursuing

summary judgment motions, dismissals in federal court, and by appealing judgments that we believe were wrongfully entered. Some of our recent victories are summarized below.

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RECENT SUCCESSES

GEORGE L. LANKFORD obtained a DEFENSE VERDICT in a one week long jury trial in Univesco, Inc., et al. v. RSP Management Services, Inc.; County Court at Law No. 4, DALLAS COUNTY, Texas, Cause No. 97-9209-D. Plaintiffs sued the Defendant property management company for breach of a lease contract, negligence, and breach of the implied warranty of suitability in commercial leases when a windstorm blew down their aircraft hanger. The jury unanimously found against the Plaintiffs on all their claims.

BARRY H. FANNING and RON M. IHLE have defended Duramed Pharmaceuticals, Inc. in more than five hundred (500) cases ACROSS THE STATE OF TEXAS in the FEN-PHEN litigation. Only a few cases remain active. FHM has succeeded in resolving the hundreds of other fen-phen cases by obtaining dismissals without our client paying any money to settle these cases.

SCOTT HUBER and GERALD LOTZER obtained a SUMMARY JUDGMENT in the 62nd District Court in LAMAR COUNTY. The case involved a Plaintiff who, when leaving a place of business, injured himself by walking into a parked forklift, which the owner had for sale. The Defense argued that the owner only had a duty to protect Plaintiff from conditions on the premises that were not open and obvious, and the Plaintiff clearly saw the parked forklift while entering the business.

THOMAS P. BRANDT and NELLIE G. HOOPER obtained a SUMMARY JUDGMENT in Gloria Stephens v. Denton Independent School District, Mark Baker, Julia Christman, Carl Stocker Nancy Stoker, Rick Woolfolk and Timothy S. Morrissy; In the United States District Court for the Northern District of Texas, Sherman Division; Cause No. 4:99CV208. FHM represented Denton Independent School District; Rick Woolfolk, a board member and Mark Baker a teacher. Plaintiff, a choir teacher, who was transferred to another school, alleged she was targeted, discriminated and retaliated against on the basis of race. She sued Defendants for Title VII discrimination and retaliation violations; conspiracy; libel and slander; tortious interference with a contract; intentional infliction of emotional distress; violations of Article I, §3, 3(a), 8, 13, 19 and 27 of the Texas Constitution; Civil Rights Act of 1966, 42 U.S.C. §§1981, 1983, 1985, and 1986; the First, Fifth, and Fourteenth Amendments of the United States Constitution; the Federal Declaratory Judgment Act, 28 U.S.C. §§2201 and 2202; and attorney’s fees under 42 U.S.C. §1988. Summary Judgment was granted as to all of Plaintiff’s claims against the school district, the board member and teacher.

THOMAS P. BRANDT and NELLIE G. HOOPER obtained a JUDGMENT FOR ATTORNEYS FEES in Gloria Stephens v. Denton Independent School District, Mark Baker, Julia Christman, Carl Stocker Nancy Stoker, Rick Woolfolk and Timothy S. Morrissy; In the United States District Court for the NORTHERN DISTRICT OF TEXAS, SHERMAN DIVISION; Cause No. 4:99CV208. After successfully obtaining a summary judgment. FHM filed an application for attorney’s fees under 42 U.S.C. §1988, for the filing of a frivolous lawsuit. The Court granted the school district, the board member and a teacher’s application and entered JUDGMENT AWARDING ATTORNEY’S FEES AND EXPENSES IN THE AMOUNT OF $56,929.50.

STEPHEN D. HENNINGER obtained a SUMMARY JUDGMENT in K. D. Pool & Van-Ken, Inc. v. Johnson County, In the United States District Court for the NORTHERN DISTRICT OF TEXAS, DALLAS DIVISION; Cause No. 3:00-CV-2246-R. Plaintiff sued Johnson County under the Fair Housing Act alleging Johnson County discriminated against manufactured housing developers in Johnson county. Summary judgment was granted as to all of Plaintiff’s claims against Johnson County.

THOMAS P. BRANDT and NELLIE G. HOOPER obtained a SUMMARY JUDGMENT in Barrow v. Greenville Independent School District and Dr. Herman Smith; In the United States District Court for the NORTHERN DISTRICT OF TEXAS, DALLAS DIVISION; Cause No. 3:00CV0913-D. FHM represented Superintendent Herman Smith who allegedly declined to interview Plaintiff for an administrative position because her children where enrolled in a private religious school. Plaintiff sued the school district and the superintendent for alleged federal constitutional rights violations. Summary Judgment was granted as to all of Plaintiff’s federal claims against Superintendent Smith.

THOMAS P. BRANDT and STEPHEN D. HENNINGER will be presenting a seminar to architects, city managers and public officials on complying with the Americans with Disabilities Act.

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MUNICIPAL LAW UPDATE

1. Tarkington ISD v. Aiken, No. 09-01-319-CV (Tex. App.--Beaumont, Jan. 24, 2002).

School had immunity for injuries sustained riding on pick-up tailgate.

Plaintiffs were participating in summer youth work program and sustained injuries while riding on the tailgate of a pick-up also driven by non-employee participants while moving furniture between buildings. Activities were supervised by school district employees. Plaintiffs filed suit alleging negligent supervision and training. The trial court denied the school's motion to dismiss, but the appellate court reversed and ordered the lawsuit dismissed. Because the allegations were of negligent supervision and training and not for negligent use of the vehicle itself, the Texas Tort Claims Act barred the suit.

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2. Lubbock v. Rule, No.07-01-00248-CV (Tex. App.--Amarillo Jan. 28, 2002).

City had sovereign immunity for injury at city park.

A child burnt her hands while climbing a metal slide exposed to the hot Texas sun at a city park, and the child's parents sued the city for negligence. Trial court denied motion to dismiss, but the appellate court held that the case should have been dismissed. Under Recreational Use Statute, city only owed plaintiffs duty of trespassers. Furthermore, plaintiffs failed to allege facts illustrating willful, wanton, or grossly negligent conduct to waive sovereign immunity for realty (or its appurtenances) used for recreational purposes. The city therefore had immunity from suit.

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3. Vela v. Waco ISD, No. 10-00-187-CV (Tex. App.--Waco, Jan. 30, 2002).

School employee had exhausted administrative remedies enough to file suit.

Employee brought suit against school district for race and sex discrimination after her reassignment. Employee filed grievance with board of trustees and filed (but later dismissed) appeal to Commissioner of Education. She also filed complaint with the EEOC and TCHR before filing suit in district court. The appellate court held that because the employee had exhausted the remedies set out in the Commission on Human Rights Act, she had satisfied all prerequisites to filing suit. The court further held that the EEOC must defer to the TCHR, and there is no "dual exhaustion requirement."

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4. City of San Angelo v. Smith, No. 03-01-00478-CV (Tex. App.--Austin, Feb. 7, 2002).

City had notice of injury under Texas Tort Claims Act.

A water treatment equipment salesman was inspecting equipment at the city's water treatment plant when he fell into a tank full of water and injured his ankle. The incident was witnessed by the plant superintendent, who informed the plant's risk manager. The next day the city undertook construction of rails to prevent similar falls. After the salesman filed suit, the city sought dismissal claiming the salesman had not followed the notice requirements of the Texas Tort Claims Act. However, the Court found that the facts clearly imputed knowledge to the city of the injury, its potential liability, and the parties' identities.

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PREMISES LIABILITY - CASE LAW UPDATE

1. City of Lubbock v. Rule, No. 07-01-00248-CV, 2002 WS 104790 (Tex. App.--Amarillo 2002, no pet. h.).

City had sovereign immunity for injury at city park.

A child playing in a city park burned her hands while attempting to climb on a slide. The child's parents sued the city under the Texas Tort Claims Act for damages caused by a premises defect. The Amarillo Court of Appeals ruled that the child's use of the park's slide did fall under the Recreational Use Act, but that the government thus treats those entering upon such recreational property as a trespasser, owing no duty to such for premises conditions. The Court ruled that to state a cause of action under the Texas Tort Claims Act where the injury involves real property, the plaintiff must allege facts illustrating the injury arose from the willful, wanton, or grossly negligent conduct of the entity. The Court reversed the trial court's denial of the City's Motion to Dismiss for Want of Jurisdiction.

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CLASS ACTION - CASE LAW UPDATE

1. Northrup v. Southwestern Bell Telephone Co., No. 13-00-377-CV, 2002 WL 254031 (Tex. App.--Corpus Christi, Feb. 21, 2002, no pet. h.).

Trial court’s approval of settlement challenged by objector. The Appellate Court found that notice issued to class was reasonable and adequate, that it adequately described how the attorney’s fees would be calculated, and that cy pres distribution of settlement was fair.

This class action was brought against Southwestern Bell seeking recovery of improper charges contained on customer bills. The class reached a tentative settlement prior to certification. The trial court then conditionally certified the class and notice was sent to all members. Appellant filed objections to the settlement prior to its approval. The court noted that the Texas Supreme Court had recently ruled that class members in settlement cases may appeal the preliminary certification of the class. Id. at *1 n.1. Northrup specifically complained about the form and adequacy of the notice issued to the settlement class. There were two different forms provided: (1) by direct mail; and (2) by publication in several Texas newspapers on two different days. The appellate court found the form was adequate and that it was the best notice practicable for advising unnamed class members of the pendency of the action.

Northrup also challenged the adequacy of the notice’s description of the attorney’s fees award. In Texas, class action notices must contain the maximum amount of attorney’s fees sought by class counsel and specify the proposed method of calculating those fees. Here, the class notice specified that the class counsel intended to ask for 20% of the total benefit provided to the class, which was equal to $2 million dollars. The court here found that this notice adequately satisfied that standard.

Finally, the appellate court noted that Dean Sherman of the Tulane University School of Law had testified that the cy pres settlement used in this case was an appropriate method for disbursing the settlement monies. The cy pres doctrine allows a trial court to decide on its own equitable remedy to distribute settlement funds in a class action when the costs of distributing the funds would outweigh the individual share to which each class member is entitled. The court noted that there was no Texas case authority addressing the cy pres distribution in a class action settlement, and therefore the trial court did not abuse its discretion in holding that the cy pres distribution was fair. The court also cited several decisions from other jurisdictions which distributed funds to charities according to the cy pres doctrine. Therefore, the appellate court affirmed the trial court’s order approving the class action settlement.

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2. Rivera v. Wyeth Ayerst Laboratories, No. 01-40122, 2002 WL 230657 (5th Cir., Feb. 15, 2002).

Class suing for purchase of allegedly defective drug, yet suffering no personal injuries, lacked standing.

In this class action, a buyer of a prescription pain killer that had been previously withdrawn from the market due to risk of liver damage sues the manufacturer to recover economic damages only alleging breach of implied warranty and DTPA violations. The United States District Court summarily certified the class without even allowing the parties to conduct any discovery and by summarily dismissing the argument that variations in the law of the 50 states would swamp any common issues.

On appeal even the class proponent recognized that the district court’s order was flawed and could not stand. However, the Fifth Circuit ruled that the case did not even present a justiciable case for controversy under Article 3 and therefore it did not have to address the class certification requirements. Instead, it vacated and rendered a judgment of dismissal.

The Fifth Circuit held that standing was an inherent prerequisite to the class certification inquiry. The Fifth Circuit reached the conclusion that the class lacked standing in part because the class was strictly defined to avoid any typicality problems that usually arise with personal injury cases. In other words, the class was limited to purchasers of the pain killers that suffered no liver damage and therefore had no personal injuries. Instead, the Plaintiffs claimed that they purchased the drugs and that the manufacturer did not list enough warnings, that the drug was defective, and that therefore they should receive their money back.

The Fifth Circuit found that the class lacked standing and did not suffer any injury in fact. The class confused the issue by casting their claims in products liability terms (failure to warn, sale of defective product) yet linking those claims to contract law damages (benefit of the bargain and out-of-pocket expenditures). In addition, the Plaintiffs failed to plead facts essential to establish a causal connection between their alleged injury and the conduct complained of. Therefore, the Fifth Circuit did not reach the class certification question because the suit did not present a justiciable case or controversy under Article 3 of the Constitution.

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3. Swanson v. Perry, No. 4: 01-CV-0258-A, 2002 WL 324283 (N.D. Tex., Feb. 27, 2002).

Class certification denied for claims of racial discrimination. No commonality and 23(b)(2) not met.

Here, a group of employees of the General Services Administration brought suit claiming that they suffered employment discrimination based on race. The class of African American male employees of GSA Region 7 filed a complaint consisting only of conclusory allegations regarding the class and provided little information on whether the named Plaintiffs were even entitled to relief. The district court conducted an analysis of the Rule 23(a) requirements but focused mainly on the commonality requirement. It eventually concluded that the central problem with the proposed class was that it was composed of individuals with widely varying job classifications, pay scales, supervisory responsibility, and histories of discrimination. Therefore, because the claims did not relate to general policies or practice, but rather individual claims, there were no sufficiently common questions of law or fact to justify class certification. Moreover, the court ruled that the class could not seek relief. A class proceeding under 23(b)(2) may not seek monetary relief which predominates over its claims for injunctive and declaratory relief. Therefore, this class did not meet 23(b)(2).

The court’s opinion also considered the Defendant’s Motion for Summary Judgment and granted the Defendant summary judgment on the grounds the Plaintiffs had not exhausted administrative remedies.

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4. Lee v. American Airlines, Inc., No. Civ. A. 3: 01-CV-1179-P, 2002 WL 226347 (N.D. Tex., Feb. 12, 2002).

Court refuses to regulate Defendant’s contact with potential class members absent record of prior misleading, coercive, or potentially interfering communications.

This class action was brought on behalf of ticketed passengers on an American Airlines flight which did not depart to London at its scheduled time. The Plaintiffs moved the court for an order to regulate American Airlines’ contact with potential class members. Specifically, the Plaintiff moved that American Airlines not be allowed to communicate with potential class members without providing prior notice to class counsel, fully disclosing to class members the existence of the litigation, providing class counsel with the contact information for the class member, and providing class members with contact information for class counsel. The court found that such an order limiting communications must be based on a clear record and specific findings reflecting potential interference with the rights of the parties. The court found in this case that the Defendant had not engaged in any abusive or unethical communications with potential class members and therefore denied the motion.

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5. H.R. 2341 - Proposed legislation would give federal courts jurisdiction over multistate class actions.

The House Judiciary committee approved this bill on March 7, 2002. Under this legislation, federal district courts would have jurisdiction in any class action in which the amount in controversy exceeds $2 million and in which any member of the plaintiff's class is a citizen of a state different from any defendant. In addition, the legislation establishes judicial review of noncash "coupon" settlements and standardized settlement notification information.

Similar legislation is pending in the Senate.

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PRODUCTS LIABILITY - CASE LAW UPDATE

1. Ridgway v. Ford Motor Co., 2002 WL 121820 (Tex. App.--San Antonio January 31, 2002).

A safer alternative design is not necessary to prove a manufacturing defect claim.

In 1997, Plaintiff Jack Ridgway was driving his used 1995 Ford F-150 truck when the truck burst into flames. Mr. Ridgway suffered second degree burns on twenty percent of his body. Plaintiff alleged the fire occurred due to an unspecified defect in the fuel and/or electrical system of the truck. Defendant filed a no evidence motion for summary judgment contending there was no evidence of a product defect or a safer alternative design. The motion was granted. The court of appeals found that Plaintiff's final claim did not allege a design defect (where it is necessary to prove a safer alternative design), but alleged a manufacturing defect (where it is not necessary to prove a safer alternative design). Accordingly, the court concluded summary judgment on the products liability claim regarding a manufacturing defect was improper and reversed and remanded the issue back to the trial court.

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EMPLOYMENT LAW - CASE UPDATE

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U. S. SUPREME COURT CASES

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1. Swierkiewi v. Sorema, U.S. Supreme Court (Feb. 26, 2002).

A fifty-three year old native of Hungary filed a suit against his former employer alleging that he had been fired on account of his national original, in violation of Title VII of the Civil Rights Act, and on account of his age, in violation of the Age Discrimination in Employment Act. The court held that an employment discrimination complaint need not contain specific facts established in the prima facie case under the framework set forth in the MacDonald Douglas Corp. v. Green, 411 U.S. 792, 802, but instead, must contain only a "short and plain statement of the claims showing that the pleader is entitled to relief" pursuant to Rule 8(a)(2) of the Federal Rules of Civil Procedure. The court ruled that in this case the petitioner’s complaint easily satisfied Rule 8(a)’s requirement because it gave the employer fair notice of the basis of his claim and the grounds upon which it rests, and was, therefore, sufficient to survive respondent’s motion to dismiss.

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2. Raygor v. Regents of the Univ. of Minnesota, U.S. Supreme Court (Feb. 27, 2002).

Petitioners each filed complaints in the federal district court against respondent, University of Minnesota, alleging a federal cause of action under the ADA and a state law of discrimination action under the Federal Supplemental Jurisdiction Statute 28 U.S.C. § 1368 which purports to toll the limitations period for supplemental claims while they are pending in federal court and for 30 days after they are dismissed. Subsequently, the district court dismissed the claims and petitioners withdrew their federal appeal after the Supreme Court held, in another case, that the ADA does not abrogate the state’s sovereign immunity. See Kimel v. Florida Bd. of Regents, 528 U.S. 62, 92 (2002). In the meantime, petitioners refiled their state law claims in state court. Respondents contended that the claims were barred by the applicable statute of limitations and that the Federal Supplemental Jurisdiction Statute did not toll the limitations period on those claims because the federal district court never had subject matter jurisdiction over the ADA claim. The Supreme Court held that the Federal Supplemental Jurisdiction Statute, 28 U.S.C. § 1368, will not toll the statute of limitations for state law claims made against nonconsenting state defendants that are dismissed on 11th Amendment grounds.

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FIFTH CIRCUIT CASES

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3. Vance v. Union Planters Corp., Cause No. 01-60216 (5th Cir. January 10, 2002).

Employee sued employer, alleging Title VII gender discrimination. After a jury trial, the court entered judgment for Plaintiff. Employer appealed. The appeals court affirmed the district court’s judgment as to liability and remanded the damages award to the trial court to determine the amount of the applicable damage cap. On remand, the district court concluded the judgment was subject to a $300,000 Title VII cap. Employer then brought this appeal, contending that a $100,000 cap was applicable in this case.

The statute limits allowable damages based on the number of employees employed by the employer in the current year. However, the statute is silent about how to identify the relevant employer. The court pointed to four factors it considered in determining whether distinct entities constituted integrated enterprise: (1) a relation of cooperation; (2) centralized control of labor relations; (3) common management, common ownership; and (4) common ownership of financial control. The court also stated that the critical question to be answered is what entity made the final decision regarding the employment matters related to the person claiming discrimination. The court of appeals stated that for purposes of 1981(a), cap on damages, the employer’s size is measured at the year of the discriminatory act and not the date of the verdict. The court ultimately concluded that in this case, the award applicable cap was $100,000 because the entity that made the final decisions regarding employment matters in this case had less than 200 employees the year in which the discrimination occurred.

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4. Degruise v. Sprint Corporation, Cause No. 00-31320 (5th Cir. Jan. 28, 2002).

Sprint terminated employee. Sprint mailed to employee, by certified mail with return receipt requested, the notice required by the Consolidated Omnibus Budget Reconciliation Act ("COBRA"). The sole issue in this appeal is whether the company met its notification duty under COBRA. The court held that a company meets its notification duty under COBRA, 29 U.S.C. § 1161 through § 1168 by sending a letter to an individual’s last known address by "certified mail," even when the company knows an individual did not actually receive the letter.

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5. Ramirez v. Landry’s Seafood, Cause No. 01-50015 (5th Cir. Feb. 4, 2002).

Employee, Shirley Ramirez, an Hispanic woman, sued her former employer, Landry’s Seafood, for violations of Title VII, claiming she was discharged based on her national origin. The district court granted summary judgment in favor of Landry’s. Landry’s conceded that Ramirez had established a prima facie case of discriminatory discharge but argued that Landry’s articulated two, nondiscriminatory reasons for discharging Ramirez. At issue was whether or not Ramirez had put forth sufficient evidence to rebut each of the nondiscriminatory reasons that Landry’s gave. In this case, Ramirez introduced evidence that another employee had engaged in the same conduct as Ramirez, but no action was taken against him. The court held that employee’s actions were in essence the same as Ramirez’s, and therefore, there was a presumption of discriminatory intent raised. Landry’s tried to differentiate the employees by saying that Ramirez had a prior disciplinary report and the other employee did not. However, the court noted that Landry’s did not rely on Ramirez’s disciplinary history in her dismissal. The court found that Ramirez had raised a genuine issue of a material fact and therefore, Landry’s was not entitled to summary judgment.

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6. Stout v. Baxter Healthcare Corp., Cause No. 00-60542 (5th Cir. Feb. 19, 2002).

Employee, Wilma Stout, sued the employer, Baxter Healthcare Corp., pursuant to Title VII and the Pregnancy Discrimination Act. Stout was hired as a probationary employee with Baxter. Probationary employees are subject to a strict attendance policy during the first 90 days. Stout, who was pregnant during the probationary period, was absent for more than 3 days of work after she experienced early labor an suffered a miscarriage that rendered medically unable to work for over 2 weeks. Baxter terminated Stout because of her absenteeism. Stout sued Baxter alleging disparate treatment and disparate impact. With regard to her disparate treatment claim, the court held that all the evidence in the record indicated that she was fired because of her absenteeism and not because of her pregnancy. The court specifically noted that Baxter’s policy did not in any way mention or focus on pregnancy, childbirth or any related medical condition. With regard to the disparate impact claim, the Court noted that there was no evidence that the employee was treated any differently than any other probationary employees who missed work and noted that this law does not require preferential treatment of pregnant employees and does not require employers to treat pregnancy related absences more leniently than other absences. The court, therefore, concluded where all the evidence in the record indicated that Plaintiff was fired because of her absenteeism, not because of her pregnancy, she could not recover under the Civil Rights Act of 1964, as amended by the Pregnancy Discrimination act of 1978.

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7. Hernandez v. Jobe Concrete Products, Inc., Cause No. 0150292 (5th Cir. Feb. 26, 2002).

Employee brought suit in state court against former employer, after he suffered an on-the-job injury. The employer removed the case to federal court and the district court issued a judgment dismissing the employee’s complaint. On appeal, the employee challenged the subject matter jurisdiction of the district court. At issue is whether ERISA’s preemption provision conferred federal jurisdiction, or whether the court should have granted the employee’s motion to remand the case to state court. The court held that where an employer adopted its own occupational injury plan to cover its employees’ on-site injuries, a decision under Texas law, ERISA’s preemption exemption, 29 U.S.C. § 1003(b), did not apply, and employees’ state law claims for benefits were preempted. Therefore, the federal district court had jurisdiction.

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INSURANCE BAD FAITH - CASE LAW UPDATE

1. State Farm Lloyds v. Mireles, 63 S.W.3d 491 (Tex. App. -- San Antonio 2001, no writ).

To be reliable, scientific evidence must be grounded in scientific method and procedure that amounts to more than subjective belief or unsupported speculation.

An expert opinion by a licensed consulting engineer that a plumbing leak in a bathroom caused a home's foundation to heave approximately six to eight feet away after water moved in a plumbing trench was unreliable and irrelevant in the insureds' suit against their homeowners' insurer to recover for damage to the foundation; the engineer could only point to one undocumented occasion of the phenomenon in a commercial building, and did not know the location of the trenches under the house. Further, the soil was dry near the alleged leak, thus an analytical gap existed between the engineer's observations and conclusions. Finally, the expert's theories were not generally accepted, and he could not rule out other causes.

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2. Limestone Products Distribution, Inc. v. McNamara, 45 Tex. Sup. Ct. J. 382 (Feb. 14, 2002).

The Texas Supreme Court discusses how to determine whether an individual is an employee or independent contractor.

The court states that the test to determine whether a worker is an employee rather than an independent contractor is whether the employer has the right to control the progress, details, and methods of operations of the work; the employer controls not merely the end sought to be accomplished, but also the means and details of its accomplishment. The right to control is measured by considering: (1) the independent nature of the worker's business; (2) the worker's obligation to furnish the necessary tools, supplies, and materials to perform the job; (3) the worker's right to control the progress of the work except about final results; (4) the time for which the worker is employed; and (5) the method of payment, whether by unit of time or by the job.

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3. ITT Hartford Insurance Company v. Home Depot, U.S.A., Inc., 45 Tex. Sup. Ct. J. 372 (Feb. 14, 2002).

Writ has been granted by the Texas Supreme Court in this case to look at when extrinsic evidence may be used to determine an insurer's duty to defend. The issue is whether the "eight corners" doctrine prevents trial courts from considering extrinsic evidence that contradicts a plaintiff's allegations about facts that only implicate the defendant's insurance coverage and not the defendants' liability. The justices of the court of appeals are split on this question.

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© Fanning, Harper & Martinson, P.C., March 20, 2002.

Fanning, Harper & Martinson, P.C.

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