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Click here for the full text of this decision FACTS:Driving a Ford Explorer, Mary Hyman was in an accident with a vehicle driven by Marilyn Baker. Hyman settled with Baker, receiving $14,146 from her. Hyman made a claim for damages to her vehicle with her insurer, Allstate Indemnity Co. Hyman felt the $14,425 Allstate offered her to settle the claim was too little, so she rejected it. When negotiations over a settlement failed, Hyman sued Allstate. Six months later, in February 2002, the storage facility where Hyman had been keeping the damaged Explorer demanded that Hyman pay storage fees or relinquish the vehicle in exchange for canceling the debt. Hyman relinquished the vehicle. Hyman’s suit against Allstate went to trial Oct. 11, 2004. A jury found that Allstate had committed a knowing violation of Insurance Code Article 21.21, awarding Hyman $21,600, which included $18,000 for the vehicle and $3,600 for a rental vehicle. The jury also awarded enhanced damages of $54,000 and attorneys’ fees of $25,000. The trial court offset the amount Hyman settled with Baker and entered a final judgment. Allstate raises six issues on appeal, and Hyman brings one on cross-appeal. HOLDING:Affirmed as reformed. Allstate first argues that the evidence is legally and factually insufficient to support the jury verdict regarding its breach of contract, arguing that the evidence shows Hyman actually breached the contract when she did not provide certain information to Allstate upon request, as required by Hyman’s policy. The court notes that the material Allstate requested included authorizations and matters having to do with the procedure by which Allstate would evaluate Hyman’s claim. The court adds that Hyman had a reasonable belief that she would be agreeing to the amount offered by Allstate if she signed the power of attorney Allstate asked of her. Though Hyman’s policy requires her to cooperate in the investigation, settlement or defense of any claim or suit, the items sought were not pertinent to that investigation. “They are only . . . pertinent to settlement as far as they would inform Allstate where to send the money after a settlement was reached and as far as power to actually take possession of the vehicle. These items could properly apply only after the settlement was reached.” The court addresses Allstate’s next argument, which is that Hyman impaired Allstate’s right of subrogation against Baker by settling with Baker before trial with Allstate. The court notes that subrogation rights ordinarily kick in only when the plaintiff has been “made whole” by the recovery from other sources. The appropriate amount to be recovered under subrogation is determined by the rules of equity, so that if the insured has ignored the insurer’s subrogation rights, the insurer will be entitled to some recovery. Here, noting first that a subrogation clause is not a covenant that would void the entire contract if not followed, the court finds that where the subrogation amount is definable, the insurer may be able to offset the judgment against it in favor of its insured by the amount that is appropriate under the facts. The determination in this case is straightforward: the physical damage to the vehicle. Thus, the subrogation amount to which Allstate is entitled was determined at trial to be $18,000. The trial court did apply an offset, but the court concludes that it was not the right amount and states that the judgment must be reformed. Allstate must be reimbursed to the extent to avoid any double recovery. “The injured party settled with the tortfeasor for an amount less than the amount the jury ultimately determined was the actual value of Hyman’s vehicle. Allstate was contractually entitled to pursue subrogation for the amount determined to be the actual value of the vehicle. Applying equitable principles to the award and the facts, and noting the lack of any clear notification to Allstate of the settlement so that it could attempt to protect its rights, we conclude Allstate is entitled to an offset against the damage award in the amount of the value of the vehicle, less the deductible, as determined by the jury. Allstate would only be authorized to recover for its subrogation rights no more than it was liable to pay the insured for the loss ($18,000.00 less $500.00 deductible = $17,500.00).” The court rejects Allstate’s argument that the jury’s valuation of the vehicle at $18,000 was outside the allowable range. The court then turns to Allstate’s argument that the evidence does not legally and factually support the finding that it violated Article 21.21. Noting that Hyman presented evidence that the value of the Explorer was as high as $22,000, and that the jury awarded $18,000, the court finds it was reasonable for the jury to conclude that the $14,425 Allstate offered was not fair and that the techniques Allstate used to persuade Hyman to settle were not made in good faith. “The jury had the authority to consider all of this evidence and conclude Allstate did not attempt in good faith to effectuate a prompt, fair, and equitable settlement secure in the knowledge that most individuals would bow to the demands so that they could use the money from their now useless vehicle to obtain another. The jury could, thus, have perceived this situation as one where the insured, instead, continued to demand the true value of her vehicle, rather than simply acquiescing to Allstate. The finding has support in the evidence.” As to the rental value damages, the court points out that the jury instruction did not require the jury to find that Hyman spent a particular amount for a rental value. It asked only what a reasonable rental value would be. The jury came up with a figure of $40 per day for three months, which was $20 more per day than what insurance covered. There was evidence to support this amount, and the damages here stand. Next, the court considers the damages award to see how it comports with the statutory cap on damages under either the Insurance Code or the Deceptive Trade Practices Act. The court reiterates that it has previously held that the Legislature intended the treble damages provision in DTPA to be a cap on the total damages recoverable under that statute. The court speculates that the DTPA can also be read to allow both actual damages and then additional punitive damages of no more than three times the actual damage award, but the court chooses to follow the interpretation that a plaintiff’s total damages are limited to three times the actual damages, plus costs and attorneys’ fees. The court rejects Allstate’s invitation to apply the offset that it is entitled to before calculating the cap on the punitive damages award. The court says to follow Allstate’s lead would be to reward a defendant that a jury has already determined was a wrongdoer. The court finds the maximum amount that Hyman was entitled to was $63,300 ($63,300 is three times $21,100, and $21,100 equals the $18,000 vehicle value, minus the $500 deductible, plus $3,600 for rental). Since the jury awarded $54,000 in addition to the vehicle value and the rental value, the award to Hyman exceeded the cap. Consequently, the court reduces the award to $63,300, applies a subrogation offset of $17,500, and awards Hyman $45,800, plus costs and attorneys’ fees. Finally, the court rejects Hyman’s argument on cross-appeal, that she was entitled to damages under Insurance Code Article 21.55, because it was not properly preserved for appeal. OPINION:Carter, J.; Morriss, CJ, Ross and Carter, JJ.

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