Complaint,Petition: Eleazar Zuniga, Irma L Zuniga VS. Allstate Vehicle and Property Insurance Company

On May 14, 2024 a Complaint,Petition was filed involving a dispute between Zuniga, Eleazar, Zuniga, Irma L, and Allstate Vehicle And Property Insurance Company, for Contract - Consumer/Commercial/Debt (OCA) in the District Court of Hidalgo County.

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Electronically Submitted
5/14/2024 2:36 PM
Hidalgo County Clerk
Accepted by: Carlos Guerra

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CAUSE NO. __________________

ELEAZAR ZUNIGA AND IRMA § IN THE COUNTY COURT
LETICIA ZUNIGA §
Plaintiffs, §
§ AT LAW NO.______
VS. §
§
ALLSTATE VEHICLE AND §
PROPRTY INSURANCE COMPANY § HIDALGO COUNTY, TEXAS
Defendant.

PLAINTIFFS’ ORIGINAL PETITION
AND
APPLICATION FOR DECLARATORY RELIEF

TO THE HONORABLE JUDGE AND JURY OF SAID COURT:

COMES NOW, ELEAZAR ZUNIGA AND IRMA LETICIA ZUNIGA (herein

collectively “Plaintiffs”), and files this Plaintiffs’ Original Petition and Application for

Declaratory Relief complaining of Defendant ALLSTATE VEHICLE AND PROPRTY

INSURANCE COMPANY, (herein or “Defendant”), and for cause of action shows the Court the

following:

I. DISCOVERY CONTROL PLAN& RULE 47(c) STATEMENT

1.1 Discovery in this matter is governed by T.R.C.P. Rule 169, the Expedited Actions

Process and T.R.C.P. Rule 190.2. The expedited actions process applies to a suit in which all

claimants, other than counter-claimants, affirmatively plead that they seek only monetary relief

aggregating $250,000 or less, excluding interest, statutory or punitive damages and penalties, and

attorney's fees and costs.

1.2. Plaintiff affirmatively pleads that Plaintiff seeks only monetary relief aggregating

$250,000 or less, excluding interest, statutory or punitive damages and penalties, and attorney's

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fees and costs. Plaintiff does not anticipate same will be necessary, however Plaintiff reserves the

right to remove this suit from the Expedited Actions Process and modify the discovery control

plan to Level 2 or 3 upon a motion showing good cause.

1.3. Plaintiff has suffered losses and damages in a sum within the jurisdictional limits

of the Court and for which this lawsuit is brought. Plaintiff seeks only monetary relief of

$250,000 or less, excluding interest, statutory or punitive damages and penalties, and attorney's

fees and costs and a demand for judgment for all the other relief to which the Plaintiff is deemed

entitled. Tex. R. Civ. P. 47(c)(1). Further, in light of the possibility that this suit may be removed

from state court on the basis of diversity jurisdiction, Plaintiff has filed a binding stipulation of

damages concurrently with this pleading, attached hereto as Exhibit A.

II. PARTIES

2.1 Plaintiff, ELEAZAR ZUNIGA, is an individual who resides in Hidalgo County,

Texas and may be served through her attorney of record at the address below.

2.2 Plaintiff, IRMA LETICIA ZUNIGA, is an individual who resides in Hidalgo

County, Texas and may be served through her attorney of record at the address below.

2.3 Defendant ALLSTATE VEHICLE AND PROPRTY INSURANCE COMPANY

(“Defendant”) is a foreign insurance company engaged in the business of insurance in the State

of Texas. Service of process is requested to be effectuated by a private process server on

said Defendant by delivering the Citation and a copy of the Original Petition to said

Defendant and/or Defendant’s registered agent at:

C T CORPORATION SYSTEM;
1999 BRYAN ST STE 900;
DALLAS, TX 75201

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Plaintiff requests that the clerk issue a copy of the citation to the undersigned at

service@palkerlaw.com to ensure service will be promptly effectuated.

III. JURISDICTION

3.1 This Court has jurisdiction over this cause of action because the amount in

controversy is within the jurisdictional limits of the Court as verified by Plaintiff Rule 47(c)

statement, supra.

3.2 This Court has jurisdiction over Defendant because this Defendant is an insurance

company which has purposefully availed itself to the jurisdiction of the State of Texas by

engaging in the business of insurance in the State of Texas, and Plaintiff’s causes of action arise

out of this Defendant’s business activities in the State of Texas.

IV. VENUE

4.1 Venue is proper in Hidalgo County, Texas, because the insured property, subject

to this suit, is situated in Hidalgo County, Texas. TEX.CIV.PRAC. & REM. CODE §15.032.

V. FACTS:
WRONGFUL DENIAL AND/OR UNDERPAYMENT OF A COVERED CLAIM

5.1. Plaintiff purchased a policy from Defendant, insuring Plaintiff’s property against

certain losses. The Policy number was 000836597017 (hereinafter referred to as “the Policy”)

5.2 Plaintiff maintains an insurable interest in the insured property, which is located

at 4104 E Manzanillo Dr Weslaco, TX 78599, (hereinafter referred to as “the Property”).

5.3. On or about 06/07/2023, The Property sustained serious structural damage as a

result of a covered loss under The Policy (the “Covered Loss Event”). Specifically, the Property

was damaged as a result of severe windstorm conditions. Shortly thereafter, Plaintiff made a

claim and demand for payment on Defendant for damages to the Property and other damages

covered by the terms of the Policy (the “Claim”). The subject claim number is 0732742929.

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5.4 Subsequent to Plaintiff making the Claim, Defendant assigned a local adjuster, to

adjust the claim (“The Adjuster”). The adjuster failed to adequately adjust Plaintiff’s claim. The

adjuster performed only a cursory inspection of Plaintiff’s reported damages and failed to adjust

for proper construction materials and methods. The adjuster made incorrect coverage

determinations and misrepresented the scope of Plaintiff’s damages to Plaintiff, thereby vastly

underpaying Plaintiff’s legitimate claim for covered losses.

5.5 After having the damages reevaluated by a qualified contractor, Plaintiff sent

Defendant a demand for payment of the claim in compliance with Tex. Ins. Code Sec. 542A.003.

In response, Defendant failed to tender adequate payment to which Plaintiff is entitled and this

matter is now ripe for litigation.

5.6 Plaintiff requested that Defendant cover the cost of repairs to the Property

pursuant to the Policy, including but not limited to, repair and/or replacement of the damaged

structures and contents located on or around the exterior of the property as well as those within

the interior.

5.7 Defendant has wrongfully delayed and denied payment of the balance due to

Plaintiff for the Claim. Based upon information and belief, and as a basis for this delay and

denial, Defendant has relied upon an inadequate and under-scoped adjustment which claims that

the cost of repair for damages to Plaintiff’s property were substantially less than the actual cost

of repairs.

5.8 Pleading in the alternative, Plaintiff’s actual covered damage and losses to the

Property as a result of the Covered Loss Event, including the costs of temporary repairs and

alternative living expenses, have caused other consequential damages to be sustained by Plaintiff

herein. Defendant is liable for these consequential damages due to its failure to promptly and

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sufficiently pay the claim.

5.9 Pleading in the alternative and based upon information and belief, the Adjuster

was compensated for each claim the Adjuster adjusted on behalf of Defendant and/or other

combination of compensation tied to the quantity of claims adjusted. So long as the Adjuster

adjusted claims favorably for Defendant, the Adjuster would continue receiving additional

assignments, thereby creating a pecuniary interest for the Adjuster to minimize the scope and

pricing of damages identified during a property inspection.

5.10. Pleading further and in the alternative, if necessary, the Adjuster was negligent,

reckless, and/or acted intentionally knowingly, fraudulently, and with malice in violating

Defendant’s written policies as they relate to claims handling practices by failing to fully

investigate and document all damage to the Property and by failing to fully investigate and

evaluate the Plaintiff’s insured losses based upon local replacement and/or repair costs for each

item of damage. Alternatively, Defendant’s own written claims handling policies were designed

to defraud policyholders such as Plaintiff.

5.11. The Adjuster, on behalf of Defendant, intentionally, knowingly and fraudulently,

with malice, engaged in the following specified acts and practices, among others stated herein, in

violation of and in breach of the adjuster’s moral, ethical and legal duties to Plaintiff as a

licensed claims adjuster. Such acts and omissions were producing and proximate causes of the

damages and losses sustained herein by Plaintiff resulting in the denial and/or underpayment of

Plaintiff’s claim; to wit:

a) The Adjuster failed to properly investigate and inspect the Property during repair

of the property which would have revealed other damages arising out of the

Covered Loss Event;

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b) The Adjuster failed to and/or refused to properly interview Plaintiff to ascertain

other damages that were not readily apparent or would not be readily apparent to

an individual unfamiliar with the property’s pre-loss condition;

c) The Adjuster refused to and did not inspect for hidden or latent damage resulting

to Plaintiff’s Property that is customarily found to exist in Property that has

undergone the type of damage of the severity that Plaintiff’s Property sustained;

d) The Adjuster failed and refused to include the usual and customary charges for

costs of materials, supplies, labor and contractor’s overhead and profit charged by

local contractors for the repair, replacement and restoration of the Plaintiff’s

Property due to the Covered Loss Event damage;

e) The Adjuster performed only a cursory inspection of the exterior and interior of

the insured Property, spending insufficient time at the Property to properly assess

all items of damage; and failed to properly assess, estimate and include covered

damage to the property in the report and adjustment of loss to Defendant for the

damages resulting from the Covered Loss Event and/or note other damages

existing to the Property at the time of inspection such as plumbing, appliances,

ceilings and walls that sustained damage as a result of the Covered Loss Event;

f) Pleading in the alternative, the Adjuster, during the investigation of the Plaintiff’s

claim, made coverage decisions, which the Adjuster was not qualified and/or

authorized to perform, by failing to include all damages sustained to the Property,

thus submitting an inaccurate and false report of Plaintiff’s Covered Loss Event

claim and its losses to Defendant;

g) Defendant fraudulently represented to Plaintiff verbally and by conduct, insisted

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that the majority of the damages to the Property were not related to the Covered

Loss Event made basis of this suit; and that most, if not all, of the covered

damages found to exist upon observation of Plaintiff property, were not covered

by the Policy, but were due to normal wear and tear or the result of other causes,

when in fact such damage was related and should have been included in the

Adjuster‘s reports to Defendant. Based upon information and belief, Defendant’s

acts and omissions as they pertain to the mishandling of Plaintiff’s claim were

largely dependent and proximately caused by its reliance on the report/adjustment

produced by the Adjuster, whom it knew, or reasonably should have known, was

biased and hence, under-scoped the damages.

5.12. Based upon information and belief, Defendant failed to thoroughly review the

fraudulent and inaccurate assessment of the Claim as produced by the Adjuster and ultimately

approved the Adjuster’s inaccurate reports of the damages to the Property.

5.13. The mishandling of Plaintiff’s claim has also caused a delay and hardship in the

ability to fully repair the Property, which has resulted in additional damages in terms of the loss

of use of the Plaintiff’s Property and mental anguish as a result thereof. In spite of Plaintiff’s

good faith efforts and/or intent to mitigate damages as required under the terms of the policy,

Defendant’s bad faith and unlawful claims adjusting practices has left Plaintiff in a vulnerable

financial state without adequate resources to repair and/or replace damaged structures, thereby

causing additional damages.

5.14 In the alternative, without waiving the foregoing, and based upon information and

belief, Defendant instructed the Adjuster to follow their claims processing guidelines of in

connection with the claims handling process for Plaintiff’s claim. Defendant was responsible for

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training, overseeing, and supervising its claim representatives and adjusters handling claims like

Plaintiff’s claim. Defendant was responsible for – and had a legal duty – to hire and retain

competent, qualified and ethical licensed adjusters and claims representatives who would deal

fairly, honestly and in good faith with its policy holders in the practice of insurance claims

handling. Defendant breached such duties in connection with the Claim by failing to properly

train, direct and oversee the claims handling practices employed by the Adjuster. Alternatively,

Defendant – either directly or through an anti-policyholder culture – purposefully instructed the

Adjuster to ignore good faith claims handling practices contained in its written training materials

and deliberately instructed the Adjuster to actively attempt to deny, underpay, underscope, and

minimize damages claimed by policyholders such as Plaintiff.

5.15 At all times material herein, Defendant had a non-delegable contractual legal duty

to timely, fairly and in good faith investigate, process, adjust, timely pay, and re-adjust claims for

all covered losses sustained by its policyholders, such as Plaintiff. Defendant represented that it

would do so in advertising mediums throughout the State of Texas and specifically in writing to

its policyholders as an inducement for them to purchase and continue to renew homeowners and

property insurance policies. Due to a lack of knowledge and understanding of the insurance

claims handling process, knowledge of construction costs and insurance policy coverage issues

relating to property losses, Plaintiff relied on such misrepresentations to Plaintiff’s detriment,

and hence (1.) purchased the Policy from Defendant, and (2.) accepted the estimate of damages

from Defendant Adjuster which, unknown to Plaintiff, included denial and underpayment of

covered losses and damages sustained. Defendant made such representations knowing they were

false and with the intent that Plaintiff rely on such representations.

5.16. Upon information and belief, Defendant, having breached its legal duty to timely,

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fairly and in good faith investigate, process, adjust and pay for all covered losses sustained by

Plaintiff herein by assigning the Adjuster to adjust and handle Plaintiff’s claim, is responsible for

the acts of omission and commission set forth herein and above in connection with the Adjuster’s

investigation and claims handling practices employed to deny and/or underpay the covered losses

and damages sustained by Plaintiff as set forth herein.

5.17 Based upon information and belief, Defendant distributed training, educational,

and instructional materials to its field claim representatives and adjusters such as the Adjuster

and held meetings and issued directives to the field instructing how Defendant wanted claims

like Plaintiff’s to be handled. Defendant, through directives to its adjusters like the Adjuster,

tasked those adjusters assigned to Plaintiff’s claim with handling such losses in line with

Defendant’s policy and procedures. Defendant communicated and disseminated claims handling

practices and methodologies to its field adjusters such as Defendant Adjuster of 1) “Quantity

over Quality”, 2) Minimization of damage estimates, 3) Under-valuation of reported replacement

and/or repair estimates, and 4) Omission of probable covered damages in reports of losses to the

Property. These policies served to fuel and motivate the Adjuster’s individual pre-disposition of

bias in favor of insurance companies and prejudice towards claimants and the resulting losses

sustained by Plaintiff as set forth herein.

5.18 Defendant failed to perform its contractual duties to adequately compensate

Plaintiff under the terms of the Policy. Specifically, it refused to pay the full proceeds of the

Policy, although due demand was made for proceeds to be paid in an amount sufficient to cover

the damaged property, and all conditions precedent to recovery upon the Policy had been carried

out and accomplished by Plaintiff. Defendant’s conduct constitutes a breach of the insurance

contract between Defendant and Plaintiff.

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5.19 From and after the time Plaintiff’s claim was presented to Defendant, the liability

of Defendant to pay the full claim in accordance with the terms of the Policy was reasonably

clear. However, Defendant has refused to pay Plaintiff in full, despite there being no basis

whatsoever on which a reasonable insurance company would have relied to deny the full

payment. Defendant’s conduct constitutes a breach of the common law duty of good faith and

fair dealing.

5.20 Pleading in the alternative, Defendant knowingly or recklessly made false

representations, as described above, as to material facts and/or knowingly concealed all or part of

material information from Plaintiff.

5.21 As a result of Defendant’s wrongful acts and omissions, Plaintiff was forced to

retain the professional services of the attorneys who are representing Plaintiff with respect to

these causes of action. Said professional services have caused Plaintiff to incur attorney’s fees

which are recoverable as a matter of law due to the unlawful conduct committed by Defendant.

5.22 Based upon information and belief, Plaintiff’s experience is not an isolated case.

The acts and omissions of Defendant committed in this case, or similar acts and omissions, occur

with such frequency that they constitute a general business practice of Defendant with regard to

the handling of these types of claims. Defendant’s entire process is unfairly designed to reach

favorable outcomes for the company at the expense of the policyholders.

VI. FACTS:
UNLAWFUL UNDERWRITING AND POLICY CANCELLATIONS

6.1. Pleading further and in the alternative, Defendant has canceled Plaintiff’s

policy, causing damages.

6.2. Texas Insurance Code Sec. 551.103 provides that “an insurer has canceled an

insurance policy if the insurer, without the consent of the insured: (1) terminates coverage

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provided under the policy; (2) refuses to provide additional coverage to which the insured is

entitled under the policy; or (3) except as provided by Section 551.1055, reduces or restricts

coverage under the policy by endorsement or other means.” Texas Insurance Code Sec. 551.111

provides that “a cancellation of an insurance policy made in violation of this subchapter has no

effect.”

6.3. Defendant, in the general course of its business, systematically renews

policies in violation of the Texas Insurance Code, thereby causing damages to insureds, such as

and including, Plaintiff. Specifically, on policy renewals, Defendant systematically adds policy

endorsements which contain material changes. These endorsements reduce coverage, change

conditions of coverage, and change the duties of policyholders. Some common endorsements

which Defendant is known to routinely slip into policies on renewals include, but are not limited

to: (1.) endorsements reducing coverage – in whole or in part – from replacement cost value

coverage to actual cash value coverage, (2.) endorsements which increase deductibles, based on

the type of loss (e.g. “wind/hail” deductibles and “named storm” or “tropical cyclone”

deductibles), (3.) endorsements which reduce or eliminate coverage if insureds don’t report

claims before arbitrary deadlines, (4.) endorsements which reduce payments for roof damages,

subject to a schedule, (5.) endorsements which wholly exclude coverage to the property’s roof,

and (6.) endorsements which exclude coverage for cosmetic damages. These are not the only

endorsements which Defendant is known to slip in at renewal, but these specific endorsements

have rampant echoing negative effects on insureds throughout this jurisdiction upon discovery.

These endorsements are systematically and routinely added to policies by Defendant without

complying with Texas Insurance Code Sec. 551.1055 and are therefore unlawful cancelations.

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6.4. Texas Insurance Code Sec. 551.1055 and Texas Insurance Code Sec.

2002.102 provide that a "material change" means a change to a policy that, with respect to a prior

or existing policy: (1) reduces coverage; (2) changes conditions of coverage; or (3) changes the

duties of the insured. Further, Defendant adding policy endorsements which contain material

changes does not, in itself, constitute a cancelation or a nonrenewal of that policy, so long as the

endorsement is added to the policy in compliance with Tex. Ins. Code Sec. 551.1055.

6.5. Tex. Ins. Code Sec. 551.1055(b) and Texas Insurance Code Sec. 2002.102(b)

require that the “insurer,” provides written notice to the insured of any material changes.

6.6. Defendant systematically does not provide the requisite written notice to any

policyholders, and specifically did not provide any such written notice to Plaintiff at the time of

policy renewal. Instead, on multiple occasions at policy renewals, year after year, Defendant

treated Plaintiff as it treats all policyholders – with deception and malice – by adding policy

endorsements which reduced coverage, prejudicing Plaintiff’s rights to recovery following the

occurrence of a covered cause of loss.

6.7. It is all too common that policyholders, including Plaintiff, purchase suitable

policies from Defendant at the time of policy inception. These policies often provide

Replacement Cost Value Coverage and low deductibles. However, year after year, at renewals,

coverage is reduced unlawfully by endorsements. Once policyholders actually sustain damages,

they are often shocked to learn that their replacement cost value coverage has been reduced to

actual cash value, and their deductibles have multiplied. Insurers such as Defendant then hide

behind these policy declarations and endorsements in a knowing and intentional plot to deprive

policyholders such as Plaintiff of the coverages which were promised at the time of policy

inception.

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6.8. To effectively add an endorsement to a policy at renewal, the “insurer” must

provide written notice which must: “(1) appear in a conspicuous place in the notice of renewal;

(2) clearly indicate each material change to the policy being made on renewal; (3) be written in

plain language; and (4) be provided to the insured not later than the 30th day before the renewal

date.” Tex. Ins. Code Sec. 551.1055(c).

6.9. Defendant systematically does not provide any written notice to its

policyholders of material changes to policies at the time of policy renewal and did not provide

any such notice to Plaintiff. Pleading further, and in the alternative, if necessary, when Defendant

does provide written notice, it is not conspicuous, it does not clearly indicate the material

changes being made to the policy, it is not written in plain language, and it is not provided to the

insured 30 days before the renewal date. Moreover, when renewal notices are provided to

policyholders, often the notice comes from the policyholders’ insurance agents – not from

Defendant as specifically required by statute. This systematic pattern has even been recognized

by the Texas Department of Insurance’s Commissioner. See TDI Commissioner’s Bulletin B-

0022-20 (stating, “TDI has received complaints about insurers not fulfilling some of these

requirements,” and further providing examples of widespread unlawfulness that has been

uncovered recently committed by numerous insurers).

6.10. Defendant has acted unlawfully to reduce Plaintiff’s coverage at policy

renewals on multiple occasions. These coverage reductions constitute cancellations and have no

effect as a matter of law. Plaintiff is entitled to the coverages which were afforded under the

policy at policy inception because Defendant failed to comply with Tex. Ins. Code Sec.

551.1055.

VII. APPLICATION FOR DECLARATORY RELIEF

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7.1. This action is being brought pursuant to Chapter 37 of the Texas Civil

Practices & Remedies Code.

7.2. Section 37.004 of that Chapter states, in relevant part: “[a] person … whose

rights, status or other legal relations are affected by a … contract … may have determined any

question of construction or validity arising under the instrument, statute, ordinance, contract, or

franchise and obtain a declaration of rights, status, or other legal relations thereunder.”

7.3. In this case, an actual and justiciable controversy has arisen between the

parties concerning Plaintiff’s contract of insurance. Plaintiff’s contract of insurance contains

numerous endorsements and policy reductions which are not original to the insurance policy

which Plaintiff bargained for at the time of policy inception. These endorsements and reductions

of coverage constitute material changes to the contract and were not added to the contract in

compliance with Tex. Ins. Code Sec. 551.1055, and therefore, they constitute cancellations and

have no effect as a matter of law.

7.4. Plaintiff accordingly requests that this Court find that:

1. Plaintiff purchased an insurance policy from Defendant;

2. At policy renewal(s), Defendant added endorsements to the policy,

which were material changes and reduced coverage;

3. Defendant added these policy endorsements and reductions of

coverage to the policy without complying with Tex. Ins. Code Sec.

551.1055; and

4. Because Defendant did not comply with Tex. Ins. Code Sec.

551.1055, these portions of the policy constitute cancellations and

have no effect as a matter of law; and therefore,

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5. Plaintiff is entitled to coverage as it was promised at the time of

policy inception.

7.5. Plaintiff additionally moves this Court to award attorney’s fees, the amount of

which to be supplemented upon completion of necessary discovery, based on the Texas Civil

Practices & Remedies Code Section 37.008.

VIII. CAUSE OF ACTION AGAINST DEFENDANT – NONCOMPLIANCE WITH THE
TEXAS INSURANCE CODE

8.1 Plaintiff repleads all of the material allegations above set forth in Paragraphs 1.1-

7.5 and incorporate the same herein by this reference as if here set forth in full.

8.2 Defendant misrepresented to Plaintiff that the damage to the Property was not

covered under the Policy, even though the damage was caused by a covered occurrence.

Defendant’s conduct constitutes a violation of the Texas Insurance Code, Unfair Settlement

Practices. TEX. INS. CODE §541.060(a)(1).

8.3 Defendant failed to make an attempt to settle Plaintiff’s claim in a fair manner,

although it was aware of its liability to Plaintiff under the Policy. Defendant’s conduct

constitutes a violation of the Texas Insurance Code, Unfair Settlement Practices. TEX. INS.

CODE §541.060(a)(2)(A).

8.4 Defendant failed to explain to Plaintiff the reasons for an inadequate settlement.

Furthermore, Defendant did not communicate that any future settlements of payments would be

forthcoming to pay for the entire losses covered under the Policy, nor did it provide any

explanation for the failure to adequately settle Plaintiff’s claim. Defendant’s conduct is a

violation of the Texas Insurance Code, Unfair Settlement Practices, TEX. INS. CODE

§541.060(a)(3).

8.5 Defendant failed to affirm or deny coverage of Plaintiff’s claim within a

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reasonable time. Specifically, Plaintiff did not receive timely indication of acceptance or

rejection, regarding the full and entire claim, in writing from Defendant. Defendant’s conduct

constitutes a violation of the Texas Insurance Code, Unfair Settlement Practices. TEX. INS.

CODE §541.060(a)(4).

8.6 Defendant refused to fully compensate Plaintiff, under the terms of the Policy,

even though Defendant failed to conduct a reasonable investigation. Defendant’s conduct

constitutes a violation of the Texas Insurance Code, Unfair Settlement Practices. TEX. INS.

CODE §541.060(a)(7).

8.7 Defendant failed to meet its obligations under the Texas Insurance Code

regarding timely acknowledging Plaintiff’s claim, beginning an investigation of Plaintiff’s claim,

and requesting all information reasonably necessary to investigate Plaintiff’s claim, within the

statutorily mandated time of receiving notice of Plaintiff’s claim. Defendant’s conduct

constitutes a violation of the Texas Insurance Code, Prompt Payment of Claims. TEX. INS.

CODE §542.055.

8.8 Defendant failed to accept or deny Plaintiff’s full and entire claim within the

statutorily mandated time of receiving all necessary information. Defendant’s conduct

constitutes a violation of the Texas Insurance Code, Prompt Payment of Claims. TEX. INS.

CODE §542.056.

8.9 Defendant failed to meet its obligations under the Texas Insurance Code

regarding payment of claim without delay. Specifically, it has delayed full payment of Plaintiff’s

claim longer than allowed and, to date Plaintiff has not received full payment for the claim.

Defendant’s conduct constitutes a violation of the Texas Insurance Code, Prompt Payment of

Claims. TEX. INS. CODE §542.058.

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IX. CAUSE OF ACTION AGAINST DEFENDANT – FRAUD

9.1 Plaintiff repleads all of the material allegations above set forth in Paragraphs 1.1-

8.9 and incorporate the same herein by this reference as if here set forth in full.

9.2 Defendant is liable to Plaintiff for common law fraud.

9.3 Defendant represented in its policy that damages resulting from a covered loss

such as this claim would be insured. Plaintiff, to Plaintiff’s detriment, purchased Defendant’s

policy in exchange for a benefit Defendant knew the Plaintiff would not receive. Plaintiff further

relied to Plaintiff’s detriment upon the false, fraudulent, and deceptive acts and practices

employed by Defendant, in performing an inspection, investigation and evaluation of Plaintiff’s

claim. Plaintiff was not knowledgeable in the manner and scope required to investigate such a

loss, nor knowledgeable in insurance loss coverage issues and were not aware of the deceptive,

fraudulent practices which required that they hire an independent adjuster after the delays and

failure to provide the promises adjusting services were discovered. Defendant, based upon its

experience, special knowledge of structural loss issues resulting from covered losses such as this

one and insurance coverage issues were able to deceive Plaintiff into believing that the property

damage loss would be competently investigated by a qualified, ethical and experienced adjuster

and that the loss would be properly, fairly and in good faith evaluated and assessed and the claim

paid. Moreover, Defendant intentionally slipped reductions of coverage and endorsements into

Plaintiff’s policy repeatedly at the time of policy renewals without required statutory notices.

Plaintiff relied on Defendant’s pledges of full coverage which were promised at the time of

policy inception, and Plaintiff suffered damages by virtue of continuing to remit premium

payments, notwithstanding Defendant’s concealed orchestrated efforts to scale down the

coverages provided to Plaintiff, year after year.

Plaintiffs’ Original Petition and Application for Declaratory Relief Page 17
Electronically Submitted
5/14/2024 2:36 PM
Hidalgo County Clerk
Accepted by: Carlos Guerra
CL-24-2059-J

9.4 Plaintiff was unaware that all such representations and conduct relating to the

investigation and handling of the claim were performed with the intent and purpose to defraud,

take advantage of and deny and/or undervalue the property losses sustained by Plaintiff. Plaintiff

was unaware that all such representations and conduct relating to the investigation and handling

of the claim were performed with the intent and purpose to defraud, take advantage of and deny

and/or undervalue the property losses sustained by Plaintiff. Plaintiff relied to its detriment on

such actions and representations resulting in the losses and damages complained of herein.

Plaintiff sought representation of the undersigned counsel in an attempt to expedite the resolution

of this claim dispute without unnecessary litigation. However, Defendant has recalcitrantly failed

to pay funds which are owed on this claim in which Defendant’s liability to pay is clear. These

undue expenses and delays were solely incurred due to the acts of Defendant in failing to

perform the duties what it was required to perform Texas Insurance Code and the contract of

insurance

9.5 The conduct of Defendant has prolonged Plaintiff’s hardship of restoring the

damaged property and increased the expense of relocation and alternative living arrangements.

Defendant knew at the time the misrepresentations and fraudulent conduct occurred (as described

above) that the representations contained in the estimate of loss were untrue and communicated

those representations to Plaintiff which were false. Each and every one of the representations

and deceptive acts and practices, as described above, and those stated in this paragraph,

concerned representations and falsehoods relating to material facts for the reason that absent

such representations, Plaintiff would not have acted as Plaintiff did, and which Defendant knew

were false or made recklessly without any knowledge of their truth as a positive assertion.

9.6 Defendant made statements and performed actions with the intention to

Plaintiffs’ Original Petition and Application for Declaratory Relief Page 18
Electronically Submitted
5/14/2024 2:36 PM
Hidalgo County Clerk
Accepted by: Carlos Guerra
CL-24-2059-J

manipulate Plaintiff to act as Plaintiff did, thereby causing Plaintiff to suffer injury and

constituting common law fraud.

X. CAUSE OF ACTION AGAINST DEFENDANT – CONSPIRACY TO COMMIT
FRAUD

10.1 Plaintiff repleads all of the material allegations above set forth in Paragraphs 1.1-

9.6 and incorporate the same herein by this reference as if here set forth in full.

10.2 Defendant is liable to Plaintiff for conspiracy to commit fraud. Defendant,

through its relationships with adjusters, and/or third-party claims adjusting firms, was a member

of a combination of two or more persons whose object was to accomplish an unlawful purpose or

a lawful purpose by unlawful means. In reaching a meeting of the minds regarding the course of

action to be taken against Plaintiff, Defendant committed an unlawful, overt act to further the

object or course of action. Plaintiff suffered injury as a proximate result. Plaintiff does not seek

damages from conspirators other than Defendant, but reserves the right to amend this pleading.

XI. CAUSES OF ACTION AGAINST DEFENDANT – BREACH OF CONTRACT/DUTY
OF GOOD FAITH AND FAIR DEALING

11.1 Plaintiff repleads all of the material allegations above set forth in Paragraphs 1.1-

10.2 and incorporate the same herein by this reference as if here set forth in full.

11.2 Defendant is liable to Plaintiff for intentional breach of contract, and intentional

breach of the common law duty of good faith and fair dealing.

11.3 Defendant’s conduct constitutes a breach of the insurance contract made between

Defendant and Plaintiff.

11.4 Defendant’s failure and/or refusal, as described above, to pay the adequate and

just compensation as it is obligated to do under the terms of the Policy in question, and under the

laws of the State of Texas, constitutes a breach of Defendant’s insurance contract with Plaintiff.

Plaintiffs’ Original Petition and Application for Declaratory Relief Page 19
Electronically Submitted
5/14/2024 2:36 PM
Hidalgo County

Case Info

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Document Filed Date

May 14, 2024

Case Filing Date

May 14, 2024

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Complaint,Petition: Eleazar Zuniga, Irma L Zuniga VS. Allstate Vehicle and Property Insurance Company

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