no estoppel against insurance company
Plaintiffs got a judgment against Bowman and sought to garnish his alleged insurer, Acceptance. Acceptance insured the car dealer who sold Bowman’s dad the car. The car dealer never gave Bowman a title or signed the sales agreement. Acceptance said that it did not insure the car because Bowman (not Bowman’s dad) owned the car. Both parties filed for summary judgment, which was granted to plaintiffs. The Court of Appeals reversed. Acceptance said that Bowman’s dad owned the car, but the trial court said that Acceptance could not deny liability on a ground not identified in its denial letter. (This is commonly referred to as the "denial letter rule." ) An insurer, having denied liability on a specified ground, may not thereafter deny liability on a different ground. But, since the material issue was that the car dealer didn’t own the car, not whether Bowman or his dad owned it, there was no waiver, since this issue was raised in the denial letter.
The next issue was whether the uncontroverted facts established the ownership of the vehicle. Texas courts look to the transfer of possession and control of the vehicle, pursuant to the parties' intent to effect the sale to determine ownership for insurance purposes. Here, it was uncontroverted that Bowman’s dad paid the full sale price for the car. Furthermore, it was uncontroverted that the car was delivered to Bowman’s dad who took possession of it. But, since the car dealer didn’t sign the sales contract, there was a factual issue as to whether the car was sold to Bowman.
Sauvain v. Acceptance, Missouri Court of Appeals, Western District.
