Tweedell v. Hochheim Prairie Farm Mutual Insurance Ass'n

1 S.W.3d 304, 1999 Tex. App. LEXIS 6487, 1999 WL 668750
CourtCourt of Appeals of Texas
DecidedAugust 26, 1999
DocketNo. 13-96-142-CV
StatusPublished
Cited by13 cases

This text of 1 S.W.3d 304 (Tweedell v. Hochheim Prairie Farm Mutual Insurance Ass'n) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Tweedell v. Hochheim Prairie Farm Mutual Insurance Ass'n, 1 S.W.3d 304, 1999 Tex. App. LEXIS 6487, 1999 WL 668750 (Tex. Ct. App. 1999).

Opinion

OPINION ON REMAND

Opinion by

Justice HINOJOSA.

We issued our original opinion in this case on February 12, 1998.1 Appellees, Hochheim Prairie Farm Mutual Insurance Association, Hochheim Prairie Casualty [306]*306Insurance Company, Hochheim Prairie Insurance Company, John E. Trott, Melvin L. Hairell, Joe Tipton, Everett C. Duna-hoe, and Celeste Matula, subsequently appealed to the Texas Supreme Court. On July 1, 1999, the supreme court issued its opinion in Crown Life Ins. Co. v. Casteel, No. 98-0218,1999 WL 450773 (Tex. July 1, 1999). On the same day, the supreme court granted the petition for review in this case and, without reference to the merits, vacated the judgment of this Court and remanded this case to us for reconsideration in light of Casteel. See Hochheim Prairie Mut. Ins. Ass’n, et al. v. Tweedell, et al., 997 S.W.2d 277 (Tex.1999).

This case involves misrepresentations allegedly made by an insurance company to some of its agents. Appellants, John Tweedell, Don Hicks, and Billy D. White (collectively “the Agents”), were independent insurance agents authorized to sell property and casualty insurance for Hoch-heim Prairie Farm Mutual Insurance Association, Hochheim Prairie Casualty Insurance Company, and Hochheim Prairie Insurance Company (collectively “the Hochheim Companies”). In 1990, the Hochheim Companies terminated the Agents’ sales representative and agency contracts and refused to renew all policies issued by the Agents because of overall combined high loss ratios for the years 1986, 1987, 1988, and 1989. The Agents sued the Hochheim Companies and their officers, John E. Trott, Melvin L. Hairell, Joe Tipton, Everett C. Dunahoe, and Celeste Matula, for breach of fiduciary duties and violations of the Deceptive Trade Practices — Consumer Protection Act2 (“DTPA”) and article 21.21 of the Insurance Code.3 Appellees filed a counterclaim alleging that the Agents had filed their DTPA claims in bad faith and moved for partial summary judgment on the ground that the Agents lacked standing to bring their causes of action. The trial court granted appellees’ motion for summary judgment and severed the counterclaim from this case. By three points of error, the Agents contend the trial court erred in granting the motion for summary judgment because they have standing and genuine issues of material fact exist. We affirm in part and reverse and remand in part.

The proper inquiry on appeal is whether the defendant, in seeking summary judgment, fulfilled its initial burden (1) to establish as a matter of law that there remains no genuine issue of material fact as to one or more essential elements of the plaintiffs cause of action, or (2) to establish its affirmative defense to the plaintiffs cause of action as a matter of law. Casso v. Brand, 776 S.W.2d 551, 556 (Tex.1989); Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 (Tex.1985); Smiley v. Hughes, 488 S.W.2d 64, 67 (Tex.1972). In deciding whether there is a disputed material fact issue precluding summary judgment, evidence favorable to the non-movant must be taken as true. Nixon, 690 S.W.2d at 549. Every reasonable inference must be indulged in favor of the non-movant and any doubts resolved in its favor. Id. Once the movant establishes an affirmative defense which would bar the suit as a matter of law, the non-movant must produce summary judgment proof raising a fact issue in avoidance of the affirmative defense. Gonzalez v. City of Harlingen, 814 S.W.2d 109, 112 (Tex.App.—Corpus Christi 1991, writ denied).

By them second point of error, the Agents complain the trial court erred in granting summary judgment on their DTPA claims on the ground that they are not “consumers” as defined by the DTPA.4 The Agents contend they are consumers [307]*307because they bought policies from the Hochheim Companies and they sought the products and services of the Hochheim Companies for their rural customers.

To have a direct cause of action under the DTPA, the claimant must be a consumer. Casteel, at -, 1999 WL 450773, at * 6; see Tex. Bus. & Com.Code Ann. § 17.50 (Vernon Supp.1999); Transport Ins. Co. v. Faircloth, 898 S.W.2d 269, 274 (Tex.1995). Section 17.45 of the DTPA defines consumer as “an individual, partnership, corporation, this state, or agency of this state who seeks or acquires by purchase or lease, any goods or services!;.]” Tex. Bus. & Com.Code Ann. § 17.45(4) (Vernon 1987). Whether a plaintiff is a consumer is a question of law for the trial court to decide. First Fed. Sav. & Loan Ass’n v. Ritenour, 704 S.W.2d 895, 898 (Tex.App.—Corpus Christi 1986, writ ref'd n.r.e.). To establish status as a consumer, a plaintiff must have sought or acquired goods or services by purchase or lease, and those goods or services must form the basis of the claim. Melody Home Mfg. Co. v. Barnes, 741 S.W.2d 349, 351 (Tex.1987); Cameron v. Terrell & Garrett, Inc., 618 S.W.2d 535, 539 (Tex.1981); Shelton Ins. Agency v. St. Paul Mercury Ins. Co., 848 S.W.2d 739, 744 (Tex.App.—Corpus Christi 1993, writ denied). The absence of either requirement will defeat a DTPA claim. Cameron, 618 S.W.2d at 539.

The Agents’ allegations fail to satisfy these requirements. Although the Agents purchased insurance policies for themselves from the Hochheim Companies, these policies are not the basis of their claims. The Agents do not contend that the Hochheim Companies misrepresented the coverage available under the terms of the policies in order to induce them to purchase the insurance. The Agents’ second contention, that they sought the Hochheim Companies’ products or services for their customers, fails because the products or services were not obtained through the Agents’ purchase or lease. Accordingly, we conclude the Agents do not have standing as consumers under the DTPA.

We hold the trial court did not err in granting summary judgment against the Agents on their DTPA claims. Appellant’s second point of error is overruled.

By their first point of error, the Agents complain the trial court erred in granting appellees’ motion for summary judgment on the ground the Agents are not persons under article 21.21 of the Insurance Code. In their motion for summary judgment, appellees argued that only insureds or beneficiaries of an insurance policy have standing to file an article 21.21 claim.

Section 16(a) of article 21.21 provides:

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1 S.W.3d 304, 1999 Tex. App. LEXIS 6487, 1999 WL 668750, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tweedell-v-hochheim-prairie-farm-mutual-insurance-assn-texapp-1999.