No take backs

Originally published by John Guild.

In KLZ Diamond Tools, Inc. v. TKG General Agency, Inc. (July 18, 2016), the Dallas Court of Appeals considered an appeal of summary judgment granted in favor of TKG, the insurer defendant, against KLZ, the plaintiff insured. KLZ claimed that the insurer failed to pay the full amount owed under a policy relating to approximately $400,000 in stolen merchandise. The insurer advanced half, but requested additional documentation relating to the merchandise. KLZ contended that the request was just stalling, and after the insurer failed to pay the full amount of the claim, sued for breach of contract, insurance code violations, deceptive trade practices, among other claims. The insurer filed a motion for summary judgment. The district court struck KLZ’s responsive summary judgment evidence due to the failure to properly prove up the attached documents and said at the hearing that it had no choice but to grant summary judgment in the absence of responsive evidence. The district court did tell KLZ’s counsel that it would allow KLZ to supplement. But the district court entered an order granting summary judgment before the deadline it gave to KLZ for the supplement, which was timely filed.

The first issue on appeal was whether the trial court erred by orally stating that KLZ was permitted to supplement an affidavit but then granting summary judgment before the deadline given. Recognizing that the summary judgment rule anticipates a party’s summary judgment evidence may not initially be properly presented and allows supplementation, the Dallas Court of Appeals held that it was an abuse of discretion to grant summary judgment without waiting for the supplemental affidavit and without explaining its ruling after having initially granting leave to supplement. Considering the supplemental evidence, the Court further concluded that summary judgment was improper because KLZ had offered summary judgment evidence creating a question of fact as to whether the insurer had improperly refused to pay the entire claim.

KLZ Diamond Tools v TKG General Agency (July 18, 2016)

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