Full Opinion

NUMBER 13-26-00615-CV COURT OF APPEALS THIRTEENTH DISTRICT OF TEXAS CORPUS CHRISTI – EDINBURG IN RE INCLINE CASUALTY COMPANY ON PETITION FOR WRIT OF MANDAMUS MEMORANDUM OPINION Before Justices Silva, Peña, and West Memorandum Opinion by Justice West 1 By petition for writ of mandamus, relator Incline Casualty Company (Incline) asserts that: (1) the trial court 2 abused its discretion by setting aside a $0 appraisal award; and (2) Incline lacks an adequate remedy by appeal to address this error. We 1 See TEX. R. APP. P. 52.8(d) (“When denying relief, the court may hand down an opinion but is not required to do so. When granting relief, the court must hand down an opinion as in any other case.”), id. R. 47.1 (“The court of appeals must hand down a written opinion that is as brief as practicable but that addresses every issue raised and necessary to final disposition of the appeal.”), id. R. 47.4 (explaining the differences between opinions and memorandum opinions). 2 This original proceeding arises from trial court cause number C-0173-23-G in the 370th District Court of Hidalgo County, Texas, and the respondent is the Honorable Noe Gonzalez. See id. R. 52.2. conditionally grant the petition for writ of mandamus. I. BACKGROUND Incline issued a homeowner’s insurance policy to real party in interest Juanita Fuentes. Alleging that her home sustained damage to its roof and interior during a storm that occurred on July 25, 2020, Fuentes submitted a claim to Incline for her property damages. Incline’s adjuster valued the covered damages at an amount below Fuentes’s deductible. Fuentes thereafter filed suit against Incline, and she invoked appraisal under her insurance policy. The trial court appointed Rodolfo “Rudy” Canché as the umpire for the appraisal process. Canché inspected Fuentes’s home on May 4, 2023. After comparing the alleged storm damages to previous damages for which Fuentes had submitted a claim in 2018, Canché issued an appraisal award finding that Fuentes’s property had not sustained damage because of the 2020 storm. Canché’s appraisal award stated: Inspection Findings: My inspection was a thorough examination of the said property on the above-stated date. Based on my findings, it is my determination that no discernible damage has been sustained by the property in question apart from what was claimed in 2018. Each area of potential concern was meticulously inspected, including the following: 1. Exterior: The external areas of the property, including walls, roofs, and windows, were inspected and were found to be in good condition with no signs of damage. 2. Interior: Interior spaces, including walls, floors and ceilings were similarly inspected and were found free of any new damage. Any damage noticed was damage that existed in 2018. The inspection was based on the reports tendered by both appraisers and my own visual inspection of the property. 2 Conclusions: Based on the findings of my inspection, it is my determination that your property has not suffered any identifiable damage that would be covered under your policy. As such, my award is zero (0). Incline thereafter filed a motion for summary judgment asserting that Fuentes’s lawsuit against it should be dismissed because the appraisal award found no covered damages, and thus Fuentes’s claims were “meritless.” In response, Fuentes filed a motion to set the appraisal award aside. Fuentes alleged that: According to his report, Umpire Canché made the decision to award Applicant Fuentes $0 based on his observation that “no discernible damage has been sustained by the property in question apart from what was claimed in 2018.” In other words, the Umpire unilaterally decided that whatever damage the property sustained was not caused by the storm at issue in this lawsuit. According to Texas law, an award issued by an Umpire acting outside of his authority is inappropriate and must be set aside. (citation omitted). Fuentes thus argued that Canché exceeded his authority by determining causation and coverage. Fuentes supported her motion with a copy of the appraisal award. Fuentes also filed a response in opposition to Incline’s motion for summary judgment. The parties subsequently filed additional briefing regarding the propriety of Incline’s motion for summary judgment, and Incline filed a response to Fuentes’s motion to set aside the award. On October 25, 2023, the trial court held a non-evidentiary hearing on Fuentes’s motion to set aside the appraisal award and took the matter under advisement. The parties thereafter submitted additional briefing for the trial court’s consideration. The record reflects that the trial court held additional status hearings regarding Incline’s motion for summary judgment and Fuentes’s motion to set aside the appraisal award on March 5, 2024, August 13, 2024, June 26, 2025, March 18, 2026, May 3 6, 2026, and August 11, 2026. On August 26, 2026, the trial court signed an order setting aside the appraisal award, and that same day, signed an order denying Incline’s motion for summary judgment. This original proceeding ensued. This Court ordered Fuentes to file a response to Incline’s petition for writ of mandamus. Fuentes duly filed her response. See TEX. R. APP. P. 52.4, 52.8. Incline filed a reply in support of its request for relief. See id. R. 52.5. II. MANDAMUS Mandamus relief is an extraordinary remedy available only when (1) the trial court clearly abused its discretion, and (2) the party seeking relief lacks an adequate remedy on appeal. In re Ill. Nat’l Ins., 685 S.W.3d 826, 834 (Tex. 2024) (orig. proceeding); In re Liberty Cnty. Mut. Ins., 679 S.W.3d 170, 174 (Tex. 2023) (orig. proceeding) (per curiam). “A court abuses its discretion if no evidence supports the finding on which its ruling rests and if the court could reasonably have reached only a contrary conclusion.” In re AutoZoners, LLC, 694 S.W.3d 219, 223 (Tex. 2024) (orig. proceeding) (per curiam). We conduct a “benefits-and-detriments analysis” to determine if the relator possesses an adequate remedy at law. In re Auburn Creek Ltd. P’ship, 655 S.W.3d 837, 843 (Tex. 2022) (orig. proceeding) (per curiam); see In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 136–37 (Tex. 2004) (orig. proceeding). III. APPRAISAL AWARDS Appraisal clauses in insurance policies provide a method to resolve disputes between policy holders and insurers regarding the amount of loss for a covered claim. In re ACE Am. Ins., 734 S.W.3d 887, 890, 891 (Tex. 2026) (orig. proceeding); Ortiz v. State Farm Lloyds, 589 S.W.3d 127, 131 (Tex. 2019); Barbara Techs. Corp. v. State Farm 4 Lloyds, 589 S.W.3d 806, 814, 820 (Tex. 2019). The Supreme Court of Texas has described “the appraisal process as an efficient and less costly alternative to litigation, requiring ‘no lawsuits, no pleadings, no subpoenas, and no hearings.’” Ortiz, 589 S.W.3d at 131 (quoting State Farm Lloyds v. Johnson, 290 S.W.3d 886, 894 (Tex. 2009)); see Barbara Techs. Corp., 589 S.W.3d at 814. That said, “appraisals do not supplant the judicial process.” Tex. Windstorm Ins. Ass’n v. Dickinson Indep. Sch. Dist., 561 S.W.3d 263, 276 (Tex. App.—Houston [14th Dist.] 2018, pet. denied) (collecting cases). “Appraisal awards made under the provisions of an insurance contract are binding and enforceable, and a court will indulge every reasonable presumption to sustain an appraisal award.” In re Auto Club Indem. Co., 580 S.W.3d 852, 855 (Tex. App.—Houston [14th Dist.] 2019, orig. proceeding) (quoting Lundstrom v. United Servs. Auto Ass’n-CIC, 192 S.W.3d 78, 87 (Tex. App.—Houston [14th Dist.] 2006, pet. denied)); see In re Germania Farm Mut. Ins. Ass’n, No. 13-25-00125-CV, 2025 WL 2217431, at *3 (Tex. App.—Corpus Christi–Edinburg Aug. 4, 2025, orig. proceeding) (mem. op.). “Because a court indulges every reasonable presumption to sustain an appraisal award, the burden of proof is on the party seeking to avoid the award.” In re Auto Club Indem. Co., 580 S.W.3d at 855 (quoting Lundstrom, 192 S.W.3d at 87); see In re Germania Farm Mut. Ins. Ass’n, 2025 WL 2217431, at *3. There are three instances in which the results of an otherwise binding appraisal may be disregarded: (1) when the award was made without authority; (2) when the award was made because of fraud, accident, or mistake; or (3) when the award was not in compliance with the requirements of the policy. In re ACE Am. Ins., 734 S.W.3d at 896 n.6; In re Germania Farm Mut. Ins. Ass’n, 2025 WL 2217431, at *3; In re Auto Club Indem. 5 Co., 580 S.W.3d at 855; Cantu v. S. Ins., No. 03-14-00533-CV, 2015 WL 5096858, at *4 (Tex. App.—Austin Aug. 25, 2015, no pet.) (mem. op.). Further, the Supreme Court of Texas has stated that an appraisal award may be set aside if it does not represent an “honest assessment of necessary repairs.” Johnson, 290 S.W.3d at 895; see In re Germania Farm Mut. Ins. Ass’n, 2025 WL 2217431, at *3. IV. ANALYSIS By two issues, Incline contends that: (1) the trial court abused its discretion by setting aside the appraisal award because the umpire acted within its authority in valuing the amount of loss and excluding pre-existing damage; and (2) Incline lacks an adequate remedy by appeal to cure this error because setting aside the appraisal award “vitiates and compromises its ability to defend against [Fuentes’s] breach of contract claim.” A. Authority for Award Fuentes contends that the appraisal award was made without authority because Canché impermissibly determined causation and coverage issues in making the award. Fuentes argues that Canché’s award, on its face, shows that Canché adjudicated causation, coverage, and liability. Fuentes relies on Canché’s statements in the award, including the provision stating, “Based on the findings of my inspection, it is my determination that your property has not suffered any identifiable damage that would be covered under your policy.” “If a party seeks to avoid an appraisal award, the burden of proof is theirs to raise an issue of material fact as to why the resolution they contractually agreed to should be set aside.” Mallady v. Homeowners of Am. Ins., No. 14-24-00147-CV, 2025 WL 2253722, at *4 (Tex. App.—Houston [14th Dist.] Aug. 7, 2025, no pet.) (mem. op.); see In re 6 Germania Farm Mut. Ins. Ass’n, 2025 WL 428509, at *4; In re Auto Club Indem. Co., 580 S.W.3d at 855; Nat’l Sec. Fire & Cas. Co. v. Hurst, 523 S.W.3d 840, 844 (Tex. App.— Houston [14th Dist.] 2017, no pet.); Lundstrom, 192 S.W.3d at 87. Here, Fuentes offered only the appraisal award as evidence in support of her assertion that Canché exceeded his authority. However, the appraisal award, standing alone, does not raise an issue of material fact regarding its propriety. In re Germania Farm Mut. Ins. Ass’n, 2025 WL 428509, at *4; In re Auto Club Indem. Co., 580 S.W.3d at 855. 3 Further, we fundamentally disagree with Fuentes’s assertion that Canché exceeded his authority. Fuentes’s contention is based on the doctrine that “appraisal is limited to damages and does not extend to determining an insurer’s liability under the policy.” In re ACE Am. Ins., 734 S.W.3d at 892; see Barbara Techs. Corp., 589 S.W.3d at 828; Ortiz, 589 S.W.3d at 132; Johnson, 290 S.W.3d at 889–90. That is, appraisers determine the amount of loss, but they do not “construe the policy or decide whether the insurer should pay.” In re ACE Am. Ins., 734 S.W.3d at 892 (quoting Johnson, 290 S.W.3d at 890); Tex. Windstorm Ins. Ass’n, 561 S.W.3d at 276. Thus, an issue regarding liability that depends on interpreting the policy is not within the purview of appraisers. See Johnson, 290 S.W.3d at 890–93; Tippett v. Safeco Ins. Co. of Ind., No. 02-19-00152-CV, 2020 WL 827143, at *11 (Tex. App.—Fort Worth Feb. 20, 2020, no pet.) (mem. op.). Determining “whether the appraisers have gone beyond the damage questions entrusted 3 In this original proceeding Fuentes also contends that the terms of her insurance policy expressly remove causation and coverage from the appraisers’ authority. Fuentes did not present this argument to the trial court, and so we do not consider it here. In re Am. Optical Corp., 988 S.W.2d 711, 714 (Tex. 1998) (orig. proceeding) (per curiam); In re Mittelsted, 661 S.W.3d 639, 659 (Tex. App.—Houston [14th Dist.] 2023, orig. proceeding). 7 to them will depend on the nature of the damage, the possible causes, the parties’ dispute, and the structure of the appraisal award.” Johnson, 290 S.W.3d at 893. All of that said, “any appraisal necessarily includes some causation element, because setting the amount of loss requires appraisers to decide between damages for which coverage is claimed from damages caused by everything else.” In re ACE Am. Ins., 734 S.W.3d at 893 (citation modified) (quoting Johnson, 290 S.W.3d at 893); see In re Auto Club Indem. Co., 580 S.W.3d at 856–57; Tex. Windstorm Ins. Ass’n, 561 S.W.3d at 276. In this regard, “[c]ausation relates to both liability and damages because it is the connection between them.” Johnson, 290 S.W.3d at 891. Thus, “separating loss due to a covered event from a property’s preexisting condition is a task for the appraisers.” In re ACE Am. Ins., 734 S.W.3d at 892; see Johnson, 290 S.W.3d at 892–93; In re Auto Club Indem. Co., 580 S.W.3d at 856–57; Tex. Windstorm Ins. Ass’n, 561 S.W.3d at 276. Here, Canché inspected the property, examined the reports tendered by the appraisers, and reviewed “all the evidence provided by each party.” He found “no signs of damage” to the exterior of Fuentes’s residence, and he found that the residence’s interior was “free of any new damage” and that “[a]ny damage noticed was damage that existed in 2018.” He concluded that “no discernible damage has been sustained by the property in question apart from what was claimed in 2018.” Canché had the authority to determine whether the alleged damage sustained to Fuentes’s home was preexisting or otherwise caused by a preexisting condition. See In re ACE Am. Ins., 734 S.W.3d at 892; Johnson, 290 S.W.3d at 892–93; In re Auto Club Indem. Co., 580 S.W.3d at 856–57; Tex. Windstorm Ins. Ass’n, 561 S.W.3d at 276. There is nothing in the record to indicate that Canché exceeded his authority by interpreting the insurance policy or making a legal 8 determination regarding coverage. See, e.g., Tippett, 2020 WL 827143, at *12; MLCSV10 v. Stateside Enters., Inc., 866 F. Supp. 2d 691, 704–07 (S.D. Tex. 2012). Considering the nature of the alleged damages, the possible causes, the parties’ dispute, and the appraisal award, we conclude that Canché did not exceed his authority. See Johnson, 290 S.W.3d at 893. Under these circumstances, and in the absence of evidence otherwise, we conclude that Fuentes has not met her burden to show that Canché acted outside of the scope of its authority. See In re Germania Farm Mut. Ins. Ass’n, 2025 WL 428509, at *4; In re Auto Club Indem. Co., 580 S.W.3d at 856–57. We sustain Incline’s first issue. B. Remedy by Appeal In its second issue, Incline asserts that it has no adequate remedy by appeal. In accordance with our standard of review for original proceedings, we weigh the benefits of mandamus review against the detriments using a fact-specific analysis particular to the case at hand. See In re Auburn Creek Ltd. P’ship, 655 S.W.3d at 843; In re Prudential Ins. Co. of Am., 148 S.W.3d at 135–36. In this regard, Incline asserts that the trial court’s order “strips [it] of the binding valuation and leaves its defense vitiated and severely compromised.” Incline argues that if the trial court orders a second appraisal, it loses the benefit of the appraisal result that it already obtained, and if the trial court proceeds to trial without an appraisal award, it “is deprived of the contractual mechanism the parties agreed would fix the amount of loss and is forced to try a case that the binding $0 award should have resolved as a matter of law.” Finally, Incline contends that the passage of time since the award was issued, a period spanning more than three years, further renders an appeal after final judgment an inadequate remedy. Fuentes does not directly 9 address Incline’s arguments regarding the adequacy of a remedy by appeal. Examining the specific circumstances of this case, we agree with Incline. “[A]ppeal is not an adequate remedy for an order setting aside an appraisal award because there is ‘no material difference between a trial court’s improper refusal to enforce an appraisal clause and a trial court’s improper setting aside an appraisal award—they both may vitiate or severely comprise the defendant’s ability to defend against the plaintiff’s breach of contract claim.’” In re Germania Farm Mut. Ins. Ass’n, 2025 WL 428509, at *6 (quoting In re Auto Club Indem. Co., 580 S.W.3d at 857). Thus, mandamus relief will preserve Incline’s “substantive and procedural rights from impairment or loss.” In re Bell Helicopter Servs. Inc., 741 S.W.3d 97, 107 (Tex. 2026) (orig. proceeding) (quoting In re Prudential Ins. Co. of Am., 148 S.W.3d at 136). Further, more than three years have elapsed since the award was issued, and mandamus will spare the parties and the public the time and money that would be wasted by continuing with litigation until final judgment and the resolution of an appeal. See id.; In re Prudential Ins. Co. of Am., 148 S.W.3d at 136. Accordingly, we sustain Incline’s second issue. V. CONCLUSION In the concluding paragraph of its petition for writ of mandamus, Incline requests relief regarding the trial court’s ruling on the appraisal award, which we have addressed above. However, Incline also requests this Court to “direct the trial court to vacate its August 26, 2026 order denying Incline’s motion for summary judgment . . . or alternatively, order the trial court to reconsider that motion.” We decline to do so. The trial court should consider this request in the first instance because the right to mandamus relief generally requires a request for action and an erroneous act or refusal to act. See 10 In re Eagleridge Operating, LLC, 642 S.W.3d 518, 525 (Tex. 2022) (orig. proceeding). We further note that this original proceeding does not include an issue or point regarding the propriety of the summary judgment or a clear and concise argument with appropriate citations to authorities and the appendix or record, in support of relief regarding the summary judgment. See TEX. R. APP. P. 52.3(g), (i). The Court, having examined and fully considered the petition for writ of mandamus, the record, and the applicable law, is of the opinion that Incline has met its burden to obtain relief. Specifically, we conclude that the trial court abused its discretion by setting aside the appraisal award, and that Incline lacks an adequate remedy by appeal. We conditionally grant the petition for writ of mandamus, and we direct the trial court to vacate its August 26, 2026 order setting aside the appraisal award and to proceed in accordance with this memorandum opinion. Our writ will be issued only if the trial court fails to promptly comply. JON WEST Justice Delivered and filed on the 27th day of October, 2026. 11