Suit against insurer, adjuster filed by Groves couple

By Kelly Holleran | Feb 12, 2009

A Jefferson County couple has filed suit against Cypress Texas Lloyds, Crawford and Co. and an adjuster, alleging they were not paid money to which they were entitled after Hurricane Ike destroyed sections of their home.

When Kevin and Chantel Newman's property at 2921 Bryon Drive in Groves sustained roof , water, wind, contents and structural damages on Sept. 13 during Hurricane Ike, they submitted a claim to Cypress, which had insured their property, according to the complaint filed Feb. 2 in Jefferson County District Court.

"Plaintiffs' property and home sustained massive damages from the high winds damaging the roof," the suit states. "As a result of the holes in the roof and other parts of their home, water damage occurred to the interior of the residence including damage to the garage, ceiling, walls and floor. Plaintiffs also sustained damage to their fence and swimming pool."

The Newmans requested Cypress cover the cost of repairs, the suit states.

However, Cypress denied the Newmans' claim for the repairs of their property, even though the policy provided coverage for losses, they claim.

It denied the claim after assigning Crawford and Company and adjuster Robert Machina to adjust the claim, according to the complaint.

Cypress told the Newmans it would not pay the full proceeds of the policy, although demand was made for it, which constitutes a breach of the insurance contract, the suit states.

"Defendants Cypress, Crawford and Machina misrepresented to Plaintiffs that the damage to the Property was not covered under the Policy, even though the damage was caused by a covered occurrence," the suit states.

Cypress, Crawford and Machina also failed to make an attempt to settle the Newmans' claim in a fair manner, a violation of the Texas Insurance Code, unfair settlement practices, they claim.

The companies failed to explain the reason for their offer of an inadequate settlement, another violation of the Texas Insurance Code, according to the complaint.

Cypress, Crawford and Machina failed to affirm or deny coverage of the claim within a reasonable time frame, the suit states.

They refused to fully compensate the Newmans, even though they did not conduct a reasonable investigation, which constitutes another violation of the Texas Unfair Competition and Unfair Practices Act, the Newmans allege.

Cypress breached its contract with the Newmans by refusing to pay the policy, according to the complaint.

Crawford and Machina misrepresented to the Newmans material facts relating to their coverage, which constitutes an unfair method of competition, the suit states.

They also acted in an unfair method of competition by failing to attempt in good faith to effectuate a prompt, fair and equitable settlement, according to the complaint.

Cypress, Crawford and Machina are liable to the Newmans for common law fraud, the suit states.

All three were part of a conspiracy and their object was to accomplish an unlawful purpose or a lawful purpose by unlawful means, the Newmans allege.

The Newmans are seeking unspecified actual, consequential, treble, punitive and exemplary damages, plus attorney's fees, costs, pre- and post-judgment interest and other relief to which they may be entitled.

Philip M. Kanayan, J. Steve Mostyn and Michael R. Ramsey of The Mostyn Law Firm in Houston will be representing them.

The case has been assigned to Judge Milton Shuffield, 136th District Court.

Case No. D183-180

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