Attorney(s) for Plaintiff:
Carl J. Kolb
Carl J. Kolb, P.C.
www.TexasLawyerMalpractice.com
$5,500,000 RECOVERY - DECEPTIVE TRADE PRACTICES - BREACH OF CONTRACT - FRAUD - DEFENDANT FAILS TO PROVIDE INSURANCE COVERAGE FOR CONSTRUCTION SUBCONTRACTOR IN SPITE OF PAYROLL CONTRIBUTIONS.
Bexar County, TX
In this action for fraud, deceptive trade practices,
insurance code violations and breach of contract, the plaintiffs
alleged that the defendant was responsible for purchasing and
maintaining appropriate insurance coverage for its
subcontractors. The defendant denied the allegations; arguing
instead that an insurance requirement did not exist among the
parties.
The plaintiff, Benny & Benny Construction Co., operated as a
subcontractor for the defendant. Throughout the parties
association, the defendant required the plaintiff to pay for
insurance. Said payments were deducted by the defendant out of
the plaintiff's weekly payroll. Thus, when the plaintiff was sued
by one of the defendant's supervisors who had been injured on the
job, the plaintiff expected that it was covered by an existing
insurance policy and requested a copy of that policy from the
defendant. Instead, the plaintiff was told that their existing
insurance did not provide coverage in the event that the
plaintiff's own act or omission created the liability at issue.
As a result, the plaintiff brought a declaratory judgment action
to require the defendant to settle the supervisor's lawsuit. The
plaintiff prevailed and the defendant did, in fact, settle the
suit. Thereafter, in May, 2009, the Court certified a class on
behalf of the subcontractors who found themselves similarly
situated to the plaintiff having allegedly purchased insurance
with payroll deductions taken by the defendant. Specifically, the
plaintiffs alleged deceptive trade practices, breach of contract,
fraud, and violations of the Texas Insurance Code.
Although the defense appealed the certification and denied that
the insurance requirement was for the protection of the
subcontractors, the suit ultimately settled with a $5,500,000
recovery for the plaintiff class.
Reference
Benny & Benny Construction Co., et al. vs. Highland Homes, Ltd.;
Judge Barbara Nellermoe, 06-15-10.
Attorneys for plaintiff: Carl J. Kolb of Carl J.
Kolb, P.C. in San Antonio, TX and Bill Ford and Lori Massey of
Ford & Massey P.C. in San Antonio, TX. Attorney for defendant:
John Weber of Fulbright & Jaworski in Austin, TX.
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