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Chamberlain McHaney, PLLC

Texas Lawyers, Austin & San Antonio

TEXAS UPDATE!

TEXAS SUPREME COURT CLARIFIES LAW ON RECOVERY OF LOSS-OF-USE IN PROPERTY DAMAGE CASES

Last Friday the Texas Supreme Court clarified decades of decisions on whether loss-of-use damages can be recovered in partial destruction cases as well as total destruction cases. Since a decision in 1932, at least six Texas courts of appeals had expressly stated that, although loss-of use damages are available in partial-destruction cases, those damages are unavailable in total destruction cases. Before last Friday the Supreme Court of Texas had never considered the issue.

The case before the court arose from a car accident that rendered a towing company’s only truck a total loss. The trial allowed a jury issue on loss-of-use damages, but the court of appeals reversed, holding that Texas law does not permit loss-of-use damages in cases of total destruction of the property at issue. In a near unanimous opinion the Supreme Court of Texas reversed the Court of Appeals concluding that loss-of-use damages are available as consequential damages, in addition to the fair market value of the property immediately before the injury, in cases where the property at issue has been completely destroyed. However, loss of use damages are limited to the time reasonably necessary for the plaintiff to replace the property at issue. J&D Towing, LLC v. American Alternative Insurance Corp.

Mark your calendars now and save the date for our Ultimate Claims Handling XXI seminar to be held on October 7, 2016 at CityPlace Conference Center in Dallas. There you will learn how to apply this case and many others in your daily claims handling.