The Houston [1st] Court of Appeals has granted mandamus to enforce a homeowner’s policy’s appraisal provision against an insured seeking nearly $2 million for a claim the insurer initially adjusted as worth less than the policy’s deductible.
The facts of In re Allied Trust Insurance Company (No. 01-25-00101; July 1, 2025) are as follows. Allied issued a homeowner’s policy to Capurso. When a tornado struck his property in January 2022, Capurso filed a claim. Because the adjuster estimated that the repairs needed did not exceed the policy deductible, Capurso hired a public adjuster to reinspect. The public adjuster included in his estimate damages to the roof, which Allied concluded were not related to the storm. After some back-and-forth, Capurso notified Allied of his intent to begin legal proceedings, asserting that the cost of repairs identified by the third-party adjuster came to $616,678.77, as opposed to the $902.42 determined by Allied’s adjuster. Capurso alleged further than Allied had “doctored” its field adjuster’s estimate to remove roof repairs. Shortly thereafter, Capurso issued a demand to Allied for $1,949,357.83. Allied reserved rights, invoked the policy’s appraisal provision, and requested Capruso and his adjuster to appear for an examination under oath (EUO). They did not show up for the meeting.
Allied rescheduled and requested photos and evidence of the claimed damage, while reserving its rights under the Policy and stating no intent to waive any of the policy provisions. Capurso, who didn’t show up at the rescheduled EOU, responded that Allied’s appraisal clause did not apply because his claim was previously denied for lack of coverage. He further claimed Allied’s requests for an EOU were unreasonable. When Allied requested another EOU, Capurso filed suit. Allied answered and filed a Motion to Compel Examination Under Oath and Appraisal. Capruso contended that appraisal would not remedy the coverage issue. He further alleged that Allied had waived its right to an EUO once it made the claim determination. The trial court subsequently denied Allied’s motion. It likewise denied Allied’s motion to reconsider. Allied sought mandamus relief.
In an opinion by Justice Rivas-Molly, the court of appeals conditionally granted the writ. The opinion first addresses the denial of Allied’s motion to compel. Looking to the policy, the court determined that Allied had a contractual right to appraisal and that its handling of Capurso’s claim did not render the clause inapplicable or waive its appraisal right (citations omitted). Citing SCOTX precedent and its own decision in In re SureChoice Underwriters Reciprocal Exchange, 702 S.W.3d 876 (Tex.App.—Houston [1st Dist] 2024, no pet.), the court reaffirmed that when a policy provides for appraisal when the parties fail to agree on the amount of loss, the fact that there are also coverage issues does not preclude appraisal as an initial matter. Appraisal may move forward without a determination of causation, which can be “left up to the courts.” Additionally, in the event of “divisible losses,” the appraiser can decide the cost to repair each one of them “without deciding who must pay for it.” Even where the insurer denies the claim, it may still reserve its right to appraisal under a policy provision requiring a waiver of appraisal to be in writing and expressly permitting the insurer to reserve its right under the policy to invoke appraisal.
The court likewise rejected Capurso’s argument that Allied “impliedly” waived appraisal. Quoting In re Universal Underwriters of Tex. Ins. Co., 345 S.W.3d 404, 406-07 (Tex. 2011), the court reiterated that “[w]aiver requires intent, ‘either the intentional relinquishment of a known right or intentional conduct inconsistent with claiming that right.” Here the policy provided no deadline for when the insured could invoke appraisal, which it immediately did upon receiving Capurso’s demand for $1.9 million following 18 months of back-and-forth communication. This did not constitute an unreasonable delay or indicate any intention to waive appraisal. Even so, Capurso didn’t argue that he was prejudiced by the delay, only that appraisal would be futile. Additionally, the policy specified that a waiver or change in the policy must be effected in writing by Allied to be valid and that requesting appraisal or examination did not waive any rights. In short, Allied followed the policy language to the letter. The trial court thus abused its discretion in denying the company’s motion to compel appraisal.
Taking a different tack, Capurso argued that Allied failed to request the EOU within 15 days of receiving Capurso’s written notice of his claim, as purportedly required by the policy. Allied responded that it had the right to investigate and request the EOU’s when Capurso made his $1.9 million demand. The court agreed, noting that the policy expressly permitted Allied to investigate and request additional information “if during the investigation of the claim such additional information is necessary.” Again, the court emphasized the communications between the parties between Capurso’s initial claim and his final demand, which stretched over a period of 18 months. Allied was well within its rights under the policy to seek further information in response to Capurso’s changing demands, including requesting the EOUs.
Because “[c]ourts have held that mandamus relief is appropriate for denial of examinations under oath because the trial court’s error cannot be adequately remedied through the normal appellate process,” the court directed the trial court to vacate its order denying Allied’s motion, instructed the parties to participate in the appraisal process, and required Capruso and his adjuster to submit to the EUO.
TCJL Research Intern Satchel Williams researched and assisted in drafting this article.
