Underwriters at Lloyds of London v. Robert Harris, Individually and D/B/A Harris Garage

Citation: Not availableDocket: 11-09-00221-CV

Court: Court of Appeals of Texas; June 3, 2010; Texas; State Appellate Court

Original Court Document: View Document

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Robert Harris, operating as Harris Garage, filed a lawsuit against Underwriters at Lloyds of London to recover unpaid towing, storage charges, and attorney’s fees following a motor vehicle accident involving a tractor-trailer owned by Kasse Transportation. The jury ruled in favor of Harris, and the trial court awarded him the total amount claimed, which included $14,972.50 in fees and $18,387.50 in attorney’s fees. 

Underwriters contested the trial court’s judgment, arguing it erred in awarding attorney’s fees and in granting both towing and storage fees. Harris sought a declaratory judgment asserting that Underwriters was liable for all unpaid charges, which the trial court supported by referencing the Texas Vehicle Storage Facility Act. 

The court’s decision on attorney’s fees was reviewed for abuse of discretion. Case law indicates that entitlement to declaratory relief does not inherently warrant attorney’s fees. Specifically, the Texas Supreme Court ruled that a plaintiff must prove damages to qualify for attorney’s fees under the applicable statutes. The Vehicle Storage Facility Act provides specific remedies for towing or storing vehicles at law enforcement's request, which influences the determination of recoverable fees.

Section 2303.155 permits the imposition of storage charges, while Section 2303.156 holds lienholders or carriers responsible for charges when they repossess a vehicle or pay a total loss claim. Section 2303.157 allows for the disposal of abandoned vehicles. The Act contains an attorney’s fee provision in Section 2303.301(b), allowing fees to be awarded to the attorney general but not to private litigants. As Harris's claim for attorney’s fees was redundant to his statutory claim and the Act does not provide for such fees, the trial court erred in awarding them. 

Regarding actual damages, Underwriters argues that the trial court incorrectly awarded Harris both towing and storage charges, interpreting Section 2303.156(b) as allowing recovery of either charge but not both due to its disjunctive phrasing. Harris contends that 'or' indicates that either of two distinct events must occur for the statute to apply, supporting full reimbursement of companies responding to law enforcement requests. The interpretation of the statute is a legal question reviewed de novo, focusing on legislative intent. The legislature is presumed to intend statutes that comply with constitutional standards, are effective in entirety, result in just outcomes, and serve public interest. 

Section 2303.156(b) states that an insurance company paying a total loss claim is liable for any amounts owed to the storage facility operator, regardless of when the charges accrued. Underwriters argues that if the legislature intended for carriers to be responsible for both towing and storage, it would have used 'and' instead of 'or,' emphasizing that 'or' signifies separation and alternative interpretations in legal contexts.

Texas legal interpretation of the term "or" is not simplistic; it requires a comprehensive statutory analysis. In Jones, the court determined that "or" in TEX. CIV. PRAC. REM. CODE. 103.0025 necessitated a choice between an administrative proceeding and a lawsuit, supported by the statute's explicit language prohibiting dual compensation claims. In contrast, the absence of similar language in Section 2303.156(b) suggests a different application. The Dallas court in In re Porter interpreted "or" as serving a conjunctive function, mandating a recall election based on either city council or city secretary certification. This view was also reflected in Cherokee Water Co. v. Freeman.

The Texas Supreme Court's ruling in Spradlin v. Jim Walter Homes, Inc. clarified that "or" can denote distinct concepts, emphasizing that legislative intent is key when determining its interpretation. The court concluded that if both new construction and renovation were included under subsection (5), it would render certain statutory language redundant. Courts typically interpret "or" as requiring a choice only when legislative intent indicates such a necessity, as seen in Jones to promote efficiency in claims processes. 

Underwriters failed to provide a public policy rationale for mandating that Harris choose between storage or towing fees. Even accepting Underwriters' position that the legislature intended for carriers to be liable for only one type of charge, their interpretation would not prevent dual recoveries for towing and storage fees incurred separately. The Tyler court highlighted the public safety implications of wrecked vehicles, noting that Section 2303.156(b) transfers the financial burden of towing from companies to insurance providers, thereby incentivizing cooperation in clearing highways. The statute specifies that carriers are liable to facility operators for any amounts owed, irrespective of prior claims paid by insurance.

Wrecked vehicles must be towed and stored after an accident, with no impact on public safety regardless of whether one or two companies provide these services. The ability of a private company to secure payment influences its willingness to offer towing or storage. Interpreting 'or' as disjunctive incentivizes companies like Harris’s to provide towing, storage, or both, aligning with the statute’s provision for recovering 'any money owed' for such services. This interpretation supports public safety by ensuring companies can receive compensation. Conversely, Underwriters's interpretation would discourage service provision without clear justification, favoring private interests over public welfare. The court overruled the second issue, affirming part of the trial court's judgment that awarded Harris actual damages, but reversed the portion awarding attorney’s fees, concluding that Harris is not entitled to such fees. The decision was rendered by Justice Rick Strange on June 3, 2010, with a panel consisting of Chief Justice Wright, Justice McCall, and Justice Strange.