Texas House members told ALI restatement on insurance liability law ‘goes out of bounds’

By David Yates | Apr 9, 2019

AUSTIN – Texas lawmakers were recently told that a Restatement of the Law of Liability Insurance “goes out of bounds” and shouldn’t be relied upon by Lone Star courts.

On April 8, the Texas House Judiciary and Civil Jurisprudence Committee heard testimony on HB 2757 and HCR 58, which both deal with how the courts should view the American Law Institute’s most recent restatement.

ALI, a Philadelphia-based group, has long published restatements with the goal of providing summaries to judges.

According to ALI, the restatement released last May seeks to address the complex rules adopted and applied by the courts in insurance coverage litigation.


Leach  

However, Rep. Jeff Leach, the committee chairman and author of HB 2757, voiced concerns that ALI’s insurance law restatement “goes far beyond current” legal thinking, “as restatements typically do,” and “reflects the aspirations and intentions” of ALI and its leadership.   

“HB 2757 seeks to make clear that the controlling law in Texas are … the laws of this state, not ALI restatements,” said Leach. “ALI is not the controlling law in the state of Texas.”

Echoing Leach’s sentiment was Rep. Tom Oliverson, sponsor of HCR 58, who told committee members ALI’s restatement “kinda goes out of bounds” and shouldn’t be relied upon by Texas courts.  

Committee members also heard from Brian Martin, an insurance attorney at Thompson Coe.

Speaking in favor of HB 2757, Martin said he had his team of lawyers review the 500-page restatement and compare it to the applicable parts of Texas law.

“In that document one thing become immediately clear from the very beginning … in every single section of the restatement there is … current Texas law,” Martin said. “So when you actually go through this document, you realize … there are proposals on what the law should be.

“In reality, we already have laws on these issues.”

Martin said he’s personally against the restatement because the courts have spent 150 years creating a balance between carriers and claimants and that the restatement could create confusion between what the law is and what ALI thinks it should be.

“Frankly, I prefer Texas laws and Texas courts deciding what the law should be,” he said.

Outside of California, Texas has some the most developed insurance law in the nation.

HCR 58 is supported by the National Association of Mutual Insurance Companies.

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Organizations in this Story

The American Law Institute Thompson, Coe, Cousins & Irons LLP

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