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Click here for the full text of this decision FACTS:Christine DeLaurentis signed up for a renter’s insurance policy through U.S. Automobile Association (USAA) in August 2000. The next month, the air conditioning unit in her apartment building leaked water into the closet in her bedroom, causing black mold to grow on one of the closet walls. Though the apartment complex said they fixed the problem with the air conditioning, the mold had not cleared up. Instead, the mold spread throughout her apartment, affecting personal belongings, art work and clothing. DeLaurentis thus made a claim under her insurance policy in June 2001. The following month, at USAA’s request, the city of Houston conducted tests on DeLaurentis’ apartment and found the mold was within an acceptable range. Tests were not specifically performed on the wall where the mold originally grew, nor on DeLaurentis’ belongs. DeLaurentis talked to Brenda Essex at USAA twice before a claims adjuster visited DeLaurentis’ apartment. The claims adjuster offered to pay DeLaurentis for the water damage, but said that mold damage was specifically excluded. The adjuster made the same assertions in a letter sent to DeLaurentis that same day. A subsequent letter sent to DeLaurentis, related to DeLaurentis’ move to another apartment while work was completed on her unit, again stated that the policy did not cover mold damage. This letter contained a personal property inventory for DeLaurentis to fill out and return, but DeLaurentis did not do so. DeLaurentis sued USAA for breach of contract and for bad faith and for DTPA violations. The parties filed cross-motions for summary judgment. The trial court eventually granted USAA’s motion, entering final judgment for the insurer. After this court issued an opinion in this case on Feb. 26, 2004, USAA filed a motion for rehearing. HOLDING:Affirmed in part; reversed and remanded in part. Motion for rehearing granted. DeLaurentis argues that the trial court erred in granting summary judgment based on USAA’s argument that DeLaurentis is precluded from filing a breach-of-contract action because she did not fill out the inventory form, a condition precedent. The court points out that provisions listing an insured’s duty after a loss are for the benefit of the insurance company, but an insurer’s denial of a claim before the deadline for completing one of those duties waives the requirement as a matter of law. Here, USAA representatives told DeLaurentis on multiple occasions that her claim for payment on mold-damaged property would be denied; she was repeatedly told the policy would pay only for items that got wet. Nothing, then, indicates that DeLaurentis would reasonably have considered the completion of the inventory to be anything more than an idle formality. The condition precedent having been waived, DeLaurentis is not barred from recovery in a suit for breach of the insurance contract. The court then interprets the insurance contract itself. The court observes that the policy covers physical loss to property caused by a peril listed in the policy, unless specifically excluded. Accidental discharge, leakage or overflow of water from an air conditioning system is included in the list of covered events. The court frames the issue this way: “Must mold be specifically identified as a named peril in the . . . policy for coverage to exist? Or, does coverage exist because the Policyholder alleges a”physical loss’ caused by a peril named in the policy?” The court uses standard and law dictionaries to ascertain the meanings of the words used in the “covered perils” list. “Applying the plain meaning of the policy language, we conclude that the policy covers tangible damage to [DeLaurentis'] personal property by water leaking from an air conditioning unit. Such water leaks can produce mold damage � a tangible loss to [DeLaurentis'] personal property. Therefore, the policy’s plain language, when read in context, giving effect to all contractual provisions, is unambiguous and requires payment for mold damage caused by a leaking air conditioning unit.” Though the court’s conclusion means that DeLaurentis can pursue her breach-of-contract claim, the court nonetheless holds that she cannot maintain her bad-faith claim. DeLaurentis provided no evidence of a misrepresentation apart from USAA’s alleged failure to perform under the insurance contract. Furthermore, a simple misconstruction of a policy provision alone cannot serve as the basis for a bad-faith claim. The circumstances surrounding the denial must be considered, but the court finds the circumstances in this case do not support the allegation. The court, however, adds that the trial court erred in granting summary judgment as to the additional DTPA claims. The court has already determined that USAA waived the conditions precedent and that mold caused by the accidental leakage of water could be covered under the policy. Thus, the trial court erred in granting summary judgment as to the additional DTPA claims because none of the meritorious grounds in USAA’s motion for summary judgment resulted in the dismissal of these claims. OPINION:Frost, J.; Hudson, Fowler and Frost, JJ.

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