Case over dead woman's organs goes to state Supreme Court

Steve Korris Jul. 26, 2011, 5:00am

AUSTIN � Grieving daughter Debra Alvarez didn't force court decisions on her property rights in her deceased mother's tissues or the kind of injury she suffered when a dealer sold them, but an insurance dispute forces those decisions on the Supreme Court of Texas.

On July 21, the Supreme Court agreed to decide whether Evanston Insurance should have defended policy holder Legacy for Life against a suit Alvarez filed in Hidalgo County.

The Supreme Court accepted questions of property damage and personal injury that appellate judges of the U. S. Fifth Circuit in New Orleans certified in June.

Fifth Circuit judges couldn't figure out what to with orders from District Judge Harry Hudspeth of San Antonio, who found Evanston owed a duty to defend Legacy of Life.

Hudspeth confused Fifth Circuit judges by providing none of the relief that apparently should have followed his decision on duty.

To sharpen the point before certifying the question, Fifth Circuit judges asserted that if the Supreme Court establishes a duty to defend, Legacy for Life will win all the relief it seeks.

They wrote that if the Supreme Court finds no duty, all of Legacy's claims will fail.

They wrote that at oral argument in January, Legacy for Life reported that it settled Alvarez's claim in Hidalgo County.

"No further information regarding the settlement or the parties hereto, at least if there were any other than Legacy and the plaintiff in the underlying suit, has been furnished."

They wrote that no one raised any issue about Evanston's duty to indemnify Legacy for Life, distinct from its duty to defend.

Case background

Alvarez and Legacy for Life executed a contract in 2006, for donation of eyes, veins, skin, bone and cartilage of Alicia Garza.

Alvarez deposed Legacy for Life owners in 2007, and Evanston provided defense counsel under Legacy for Life's general liability policy.

Alvarez sued Legacy for Life and other companies in 2009, claiming they conspired to profit from tissues they obtained from vulnerable persons.

Among other claims, she alleged property damage and personal injury.

She claimed actions of defendants were intentional, extreme and outrageous.

Her last allegation dealt with silica exposure, suggesting her lawyers accidentally lifted it from standard text of mass actions.

Jeffrey Seely, of Arnold and Itkin in Houston, filed the complaint in association with Ramon Garcia of Edinburg and Julian Gomez of McAllen.

Evanston notified Legacy for Life that it wouldn't defend the suit, and Evanston sued in federal court for declaratory judgment that it owed no duty.

Legacy for Life lawyer John Cave, of Gunn, Lee, and Cave in San Antonio, filed a counter claim.

He wrote that his client incurred about $36,000 in legal bills, with more to come.

He moved for summary judgment that Evanston breached the insurance contract and owed attorney fees in both cases, plus 18 percent interest for delaying payment.

At a hearing, Evanston lawyer Marc Wojciechowski of Spring told Hudspeth that under Texas law, bodies are not property.

"Body parts, tissues, and organs are not property," he said. "None of the claims in the underlying lawsuit seek to recover damages which are covered under the policy."

Hudspeth ruled last year that in Texas, a court could find that knowing misconduct of the kind Garza alleged constituted an accident under the policy.

"Although Ms. Alvarez does not allege physical injury, she does plead extreme and understandable mental anguish and emotional distress," he wrote.

"The definition of personal injury seems broad enough to cover those injuries," he wrote.

He wrote that a Texas court could rule either way on the existence of property rights in tissues.

Alvarez moved to amend the order, pointing out he ignored her other claims for relief.

He amended the order, specifically dismissing her other claims.

Cave moved for fees, and Hudspeth denied the motion.

Evanston appealed the judgment for Legacy for Life, and Legacy for Life cross appealed in pursuit of its other claims.

This June, Fifth District Justices Will Garwood of Austin, Jennifer Elrod of Houston, and Leslie Southwick of Jackson, Miss., decided they couldn't interpret "personal injury" under Texas law.

They wrote that Texas case law declines to extend full property rights to dead bodies, and they mused over its possible status as tangible property.

Texas cases on property status of dead bodies dated from before World War II, they wrote.

When Hudspeth ruled Evanston had a duty to defend, they wrote, he should have granted judgment on breach of contract, attorney fees and 18 percent interest.

They didn't decide whether he ruled correctly on duty.

"We disclaim any intention or desire that the Supreme Court of Texas confine its reply to the precise form or scope of the questions certified," they wrote.

The Supreme Court didn't set a date for oral argument.

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