Property insurers are often frustrated when damage occurs due to the actions of others, especially when a governmental agency is at fault. In the Lone Star State, the Texas Tort Claim Act (TTCA) establishes that these agencies, for the most part, have immunity, including immunity from lawsuits and liability. This means the government is generally protected from judgments and legal actions unless the legislature specifically provides an exception. Ben Bolt-Palito Blanco Consol. Indep. Sch. Dist. v. Texas Pol. Subdivisions Prop. Cas. Joint Self-Ins. Fund, 212 S.W.3d 320, 324 (Tex. 2006).
Under the TTCA, the legislature has provided a limited waiver for tort claims arising from premises or special defects. Tex. Civ. Prac. & Rem. Code Ann. § 101.022(a), (b). Unless the TTCA clearly and unambiguously waives immunity, a government maintains its immunity from suit and tort liability for its own acts or the acts of its agents for its governmental functions. City of Wylie v. Taylor, 362 S.W.3d 855, 860 (Tex. App. 2012)
For the tort-claim waiver to apply, insurers must first assess whether the government is involved in the occurrence and, secondly, whether the entity was engaged in a governmental function at the time of the action giving rise to the claim. Insurers also need to consider whether the allegations meet the requirements of Section 101.021, which provides that a governmental unit is liable for:
(1) property damage, personal injury, and death proximately caused by the wrongful act or omission or the negligence of an employee acting within his scope of employment if:
(A) the property damage, personal injury, or death arises from the operation or use of a motor-driven vehicle or motor-driven equipment; and
(B) the employee would be personally liable to the claimant according to Texas law; and
(2) personal injury and death so caused by a condition or use of tangible personal or real property.
Tex. Civ. Prac. & Rem. Code Ann. § 101.021.
For instance, in City of Dallas v. Hillis, 308 S.W.3d 526, 536 (Tex. App. 2010), the court established that if an injury results from the negligence of an employee involving a motor-driven vehicle or equipment, as well as from a condition or use of tangible or real property, immunity might be waived.
In Zacharie v. City of San Antonio, 952 S.W.2d 56 (Tex. App. 1997), the court ruled that the Water System Board of Trustees was immune from liability for property damage incurred during a fire. The claim resulted from a failure to maintain pumps and equipment that ensured sufficient water pressure for fire hydrants. The plaintiff argued that the water pumps were effectively motor-driven vehicles, positing that this would lift the immunity. However, the court highlighted that not all usages of motor-driven equipment are enough to waive immunity.
In San Antonio Water System v. Overby, 429 S.W.3d 716, 722 (Tex. App. 2014), the court clarified that a “nexus between the operation or use of the motor-driven vehicle or equipment and Plaintiff’s injuries” is required to pursue such a waiver. It further noted that if the motor-driven equipment only creates the conditions under which an injury occurs, it does not hold causative power over that injury. Moreover, the court in Schaefer v. City of San Antonio By & Through Water Works Bd. of Trustees, 838 S.W.2d 688, 692 (Tex. App. 1992), illustrated a similar scenario where damage occurred due to a government entity repairing a broken water pipe. The allegations centered around actions related to water distribution, thereby indicating that the damages were tied to broader operational principles rather than the use or handling of motor-driven equipment.
Insurers considering subrogation should check for potential immunity issues against any interested party early in the loss assessment so they do not waste resources on a claim where recovery will be precluded.
