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Click here for the full text of this decision FACTS:A February windstorm caused damage to the Spring Creek Village Apartments. Spring Creek had primary insurance coverage with Reliance Insurance Co. of Illinois for property damage and loss of business income up to $1 million. Spring Creek also had excess coverage exceeding the $1 million primary policy limit through General Star. By its terms, the General Star policy only applied after the coverage provided by Reliance was exhausted. Otherwise, the General Star policy followed the terms, conditions, and definitions of coverage and recovery stated in the Reliance policy. Spring Creek filed a claim for property damage and loss of business income as a result of the windstorm with Reliance. Because Spring Creek and Reliance could not agree on the amount of loss, Spring Creek invoked the appraisal provision of the Reliance primary policy, which provides that if Reliance and Spring Creek disagreed as to the amount of loss, either party could demand an appraisal. Pursuant to the appraisal provision, both parties were required to “select a competent and impartial appraiser,” and the two appraisers would select an umpire. A decision agreed to by any two of the three would be binding as to the amount of loss. Because General Star owed no obligation to Spring Creek until the loss exceeded $1 million, General Star did not participate in the appraisal process. Spring Creek hired Steve Edwards d/b/a City Wide Construction as its appraiser; Reliance hired John Lochridge, and Lynn Taylor was selected as the umpire. Edwards estimated the amount of loss to Spring Creek at $5,286,000. Lochridge estimated the amount of loss at $367,842. The umpire issued an award that found replacement cost value of the loss to be $2,105,790.98 and actual cash value to be $1,566,673.51. Reliance subsequently filed a declaratory judgment action seeking to have the appraisal award declared invalid. The trial court granted a partial summary judgment in favor of Spring Creek that the appraisal award was binding. The trial court’s ruling left undecided the question of whether Spring Creek had failed to mitigate its damages. The trial court subsequently bifurcated the trial of Spring Creek’s remaining causes of action. Spring Creek’s claim that Reliance and General Star had breached their contracts was tried separately from Spring Creek’s claim that the insurance companies had violated provisions of the Insurance Code and the Deceptive Trade Practices Act. In December 2000, the trial court granted a summary judgment in favor of General Star that Spring Creek had no cause of action against General Star for breach of the duty of good faith and fair dealing. In the first trial, the jury found in favor of Spring Creek on its breach of contract claims and awarded damages for loss of business income and attorneys’ fees. The judgment further awarded Spring Creek replacement cost value based on the appraisal award. Following the first trial, a Pennsylvania court declared Reliance insolvent and placed it in liquidation. Pursuant to the Pennsylvania court’s order, the Texas Commissioner of Insurance designated Reliance as an impaired insurer. See Texas Insurance Code Annotated Art. 21.28-C, 17 (Vernon Supp. 2004-05). On Spring Creek’s motion, the trial court severed Reliance from the case and permitted the extra-contractual claims to proceed against General Star. In the second trial, the jury found that General Star violated provisions of the Texas Insurance Code and the DTPA. The trial court entered a final judgment in which it awarded Spring Creek damages pursuant to the appraisal award, penalties under the Insurance Code and the DTPA, and attorneys’ fees. HOLDING:Affirmed. Because Edwards had a financial interest in insuring the appraisal award exceeded $2 million, General Star raised a fact issue with regard to whether Edwards was impartial. An appraiser with a financial interest in the outcome of the appraisal is not impartial. Delaware Underwriters v. Brock, 211 S.W. 779 (Tex. 1919). The question of Edwards’s lack of impartiality raised a fact question which should have been submitted to a jury. If the jury finds the appraiser is impartial, it follows that the appraisal award was not in compliance with the insurance policy and is not binding. General Star raised a genuine issue of material fact with regard to whether Spring Creek’s appraiser was impartial in compliance with the insurance policy. Therefore, the trial court erred in granting partial summary judgment. Spring Creek contends the trial court erred in granting summary judgment dismissing Spring Creek’s claim that General Star breached the duty of good faith and fair dealing. Because Texas law does not impose a duty of good faith and fair dealing on an excess carrier, the court concludes the trial court properly granted summary judgment. OPINION:Seymore, J.; Fowler, Edelman and Seymore, JJ. (Edelman, J., concurs in result only.)

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