Texas Appellate Court Granted Mandamus and Allowed Insurer to Intervene in Case Brought Against Adjusting Company and Individual Adjuster

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Plaintiffs attorneys have been doing their darnedest to avoid litigating in federal court. That’s because federal court judges are more likely to consider dispositive motions and are stricter in enforcing deadlines and discovery standards. Therefore, to avoid federal court jurisdiction, attorneys try to add non-diverse parties – i.e., defense parties who have the same state residency as the plaintiff – even when the true defendant should only be the insurance company. One recent scheme used to avoid federal courts is to avoid suing the insurance company altogether and instead sue the adjuster, independent adjuster companies, and even third-party administrators. But recently in the mandamus action In re Trisura Ins. Co., No. 13-25-00139-CV, 2025 WL 2094147, at *1 (Tex. App. July 25, 2025), the Corpus Christi- Edinburg Court of Appeals recognized the scheme for what it was and granted mandamus relief in part.

Specifically, Trisura Insurance Company (Trisura), Eagle 1 Adjusting LLC (Eagle 1), and Thomas Maretzki ( Maretzki) (collectively Relators) filed for mandamus relief to the Corpus Christi- Edinburg Court of Appeals alleging that the trial court abused its discretion by: (1) striking their plea in intervention; (2) denying their motions to dismiss Eagle 1 and Maretzki from the lawsuit; and (3) denying Eagle 1’s motions to quash and for protective relief from depositions. The Court granted mandamus relief in part and denied in part.

Here, Maria De La Luz Selvera (the Insured) submitted a property damage claim for extensive damage to her home due to an alleged storm. Trisura’s third-party administrator (TPA) assigned Eagle 1 and its adjuster, Maretzki, to inspect the property and investigate the claim. Trisura thereafter determined that the part of the Insured’s claim relating to wind damage to the roof and collateral damage to the fence was covered under the policy at issue, but the wear and tear damages to the roof, interior damages resulting from wind-driven rain, and interior damages resulting from other sources were not covered. On September 8, 2023, the Insured’s counsel contacted Trisura’s TPA for additional information, and sometime after, sent a pre-suit notice and demand letter to Maretzki.

On March 14, 2024, the Insured filed suit against Eagle 1 and Maretzki, alleging that they failed to properly investigate and adjust her property damage claim. The Insured asserted causes of action against them for negligence, violations of the Texas Insurance Code, and violations of the Texas Deceptive Trade Practices Act. Notably, the Insured did not name the insurer, Trisura, as a defendant in the lawsuit.

On April 5, 2024, Trisura invoked its right to appraisal under the insurance policy and elected to assume whatever liability its agents might have to the Insured under § 542A.006 of the Texas Insurance Code. See Tex. Ins. Code Ann. § 542A.006 (governing an insurer’s election of legal responsibility in an action against its agents).

On January 27, 2025, Trisura filed a plea in intervention in the lawsuit. Trisura alleged that it issued the insurance policy at issue; hired Eagle 1 and Maretzki to inspect the Insured’s property; found partial coverage for the claim; and issued payment to the Insured minus her deductible and depreciation. Trisura argued that the Insured’s claims were either its sole responsibility or a responsibility that it shared with Eagle 1 and Maretzki and explained that it was the only party liable under the insurance policy as all the Insured’s claims arose from her contention that she was wrongfully underpaid under the policy. Trisura also alleged that it had previously elected to accept whatever liability its agents, including Eagle 1 and Maretzki, pursuant to § 542A.006 of the Texas Insurance Code. On the same ground, Trisura also filed a motion to dismiss the Insured’s causes of action against Eagle 1 and Maretzki with prejudice. Eagle 1 and Maretzki filed a separate motion to dismiss the claims against them on this same basis.

On January 28, 2025, the Insured filed notices of intent to take the oral depositions of Maretzki and a corporate representative for Eagle 1 and in response, each filed motions to quash and for protective relief on grounds that the lawsuit against them should be dismissed. In response, the Insured filed a third amended petition and clarified that she “[was] seeking only tort claims” against Eagle 1 and Maretzki, that “no breach of contract claims are alleged or sought,” and that she [was] not “seeking any form of ‘policy benefits’ or asserting entitlement to same in any manner or way.” The Insured filed an emergency motion to compel the depositions of Maretzki and Eagle 1 and for sanctions based on their refusal to participate in discovery. The Insured also filed a motion to strike Trisura’s plea in intervention and response to its motion to dismiss. The Insured again argued that she had “expressly limited” her claims to include only those against the adjusters “for their individual tortious conduct” and that she had not asserted any claims for policy benefits or payment under the policy. The Insured further argued that Trisura could not rely on § 542A.006 to support its plea in intervention and the motions to dismiss because that section only applied to instances in which the insurer was a party to the lawsuit. Trisura, Eagle 1, and Maretzki all filed the proper responses to such motions. 

The trial court granted the Insured’s motion to strike Trisura’s plea in intervention; denied Trisura’s motion to dismiss as moot on grounds it was “not a proper intervenor”; and denied Eagle 1 and Maretzki’s motion to dismiss. On March 26, 2025, Relators filed the petition for writ of mandamus and a motion to stay.

Plea in Intervention

Trisura argued in part that it possessed a justiciable interest because it accepted the liability that Eagle 1 and Maretzki might have to the Insured under Texas Insurance Code § 542A.006. The Insured argued that § 542A.006 did not apply because Trisura was not a party to the action at issue.

The Court expressly rejected the Insured’s argument and reiterated its prior holding(s) stating that “subsection (a) of § 542A.006 states that “an insurer that is a party to the action may elect to accept” its agents’ liability, subsection (b) explicitly allows an insurer to make an election ‘before a claimant files an action,’ and, accordingly, § 542A.006 does not apply only to insurers who are named defendants in a lawsuit and ‘that this interpretation does not extinguish causes of action against insurance agents, because the election procedure under § 542A.006 instead shifts liability for those causes of action to the insurer.” The Court held that the trial court abused its discretion by refusing to allow Trisura to intervene because it possessed a justiciable interest: (1) a judgment in favor of the insured would likely lead to an action against Trisura because it elected to accept its agents’ liability under § 542A.006; (2) the agents, as non-parties to the insurance policy, could not invoke appraisal which might defeat the Insured’s claim or a part thereof; and (3) the Insured’s claims, however characterized (even as “pure tort claims”), were factually premised on the insurance policies and Trisura’s partial rejection of the claim.

The Court also determined that allowing Trisura to intervene would not excessively multiply the issues because the causes of action, defenses, and relevant facts were largely the same.

Motion to Dismiss

The Court held that Trisura elected to accept whatever liability that Eagle 1 and Maretzki may have to the Insured, and it did so after the Insured filed suit. The Court emphasized and agreed with the Fifth Circuit’s assessment that “an insurer’s § 542A.006 election ‘eviscerates any claim against an agent’” and reiterated that the Legislature drafted § 542A.006 to provide that the trial court “shall” dismiss the claimant’s action against an agent when the statutory prerequisites are satisfied and that the use of the word “shall” imposes a mandatory duty. See In re Rogers, 690 S.W.3d 296, 300–01 (Tex. 2024) (orig. proceeding) (per curiam).

Accordingly, the Court held that because Trisura made an election after suit was filed to assume whatever liability that Eagle 1 and Maretzki might have had, the insurance code imposes a mandatory duty on the trial court to dismiss the action against Eagle 1 and Maretzki with prejudice and therefore, the trial court abused its discretion.

Depositions of Eagle 1 and Maretzki

Relators again alleged § 542A.006 requires Maretzki and Eagle 1 to be dismissed from the lawsuit, and that Trisura [had] the right to invoke appraisal and have the case abated pending the outcome of appraisal. Trisura argued that appraisal must move forward before any discovery could take place. The Court rejected this argument on the basis that while the ruling required that the trial court to dismiss Eagle 1 and Maretzki from suit, the argument failed to consider that a party may seek discovery from both parties and nonparties to suit. Tex. R. Civ. P. 205 (governing discovery from nonparties). The Court also held that Relators cited no authority in favor of the assertion that discovery must be stayed pending the completion of appraisal. Accordingly, the Court held that the trial court did not abuse its discretion.

The Lowdown: This case highlighted that under Texas law an insurer does not need to be a party to the case to make an election under § 542A.006 and that the language of the statute imposes a mandatory duty on the trial court to dismiss the suit against the insurer’s agents once election is made. This case is also important because over the last several years there have been similar cases where an insured has only named an insurer’s adjusters/agents in the lawsuit as an attempt to avoid the breach of contract claim and the applicable defenses/limitations pursuant to the insurance policy but this case reiterated that an insurer, such as Trisura, has a right to intervene – i.e. possesses a justiciable interest under such facts, because (1) a judgment in favor of the insured would likely lead to an action against the insurer because the insurer had elected to accept its agents’ liability under § 542A.006; (2) the agents, as non-parties to the insurance policy, could not invoke appraisal which might defeat the insured’s claim or a part thereof; and (3) the insured’s claims, however characterized, were factually premised on the insurance policy and the insurer’s rejection of the claims. 

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