Category: Legislation

Texas Partnerships – Rights to Third Parties & Apparent Authority

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What exactly is a “partnership” under the laws of the State of Texas?  As a starting point, a PARTNERSHIP may arise when two or more individuals become associated in a common venture for the purpose of making money.  This association of individuals would NOT be a partnership if appropriate documents are signed which provide that the joint owners instead intended to create a different business structure – like a Corporation or a Limited Liability Corporation (LLC).   Basically, in the absence of any documentation to the contrary, two or more associated individuals may be considered partners in the eyes of the law.  Since the individuals are considered Partners in the business venture, they each have the ability to legally bind the business venture and the other Partner (or Partners).  Since the individuals are considered[…]

Insurance: Stowers Doctrine in Texas

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The Stowers doctrine in Texas imposes a duty on insurers to settle third party claims against their insured under circumstances that would cause a reasonably prudent uninsured to settle. Sample Stowers Demand Letter The theory behind the rule is that it is necessary in order to prevent insurers from “rolling the dice” with the insured’s money.  An example helps explain this concept.  Consider a situation where an insured with $30,000 limits runs a stop sign and causes the death of an innocent child. Under any reasonable evaluation, the insured faces liability exposure greatly in excess the policy limits.  But if the insurance company faces no exposure in excess of the $30,0000 limit, what incentive does it have to tender the[…]

Insurer Liability For Failure to Pay Promptly

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Every attorney who represents policyholders dreams of “hitting the big one” and holding an insurance company liable for treble damages for unfair settlement practices.  In the process, Texas’ Prompt Payment of Claims statute is often overlooked or under appreciated as an avenue of recovery. The Prompt Payment statute (previously known as Art. 21.55) is now codified at sections 542.051-061 of the Texas Insurance Code.  This statute provides an 18% per year penalty for first party claims that are not paid after the insurer has had an opportunity to ask for information and conduct a reasonable investigation. What the statute lacks in damages, it makes up for in simplicity.  Recovery is automatic for any covered claim that has been delayed without[…]

Employee Lawsuits a New Sign of the Times

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The New York Times published an article with a headline that made me, as a business owner, uneasy; and, it made me, as an attorney, worried for my clients.  The article was entitled Layoffs Herald a Heyday for Employee Lawsuits and it informs us that as more workers are being let go due to the economy and corporate layoffs, they are more inclined to sue their former employers for having been unfairly or wrongfully dismissed. The Texas Workforce Commission is displaying this quote on its unemployment insurance web page – “The Texas Workforce Commission is experiencing extremely high call volume. Many states across the nation are facing the same challenges due to recent federal extensions of unemployment insurance benefits. Due[…]

Paycheck Fairness & Fair Pay – What the House did in 2009 that Impacted You

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Employment law issues were among the first measures considered by the 111th Congress in the New Year.  Specifically, on Friday, January 9, 2009, the House of Representatives passed two bills aimed at ensuring equal pay for equal work: the Lilly Ledbetter Fair Pay Act and the Paycheck Fairness Act. While these bills must still pass the Senate and be approved by the President, President-Elect Obama has previously voiced his support of the measures. Lilly Ledbetter Fair Pay Act: Rep. George Miller YouTube Video Lilly Ledbetter Fair Pay Act Notably, the Lilly Ledbetter Fair Pay Act would reverse the 2007 Supreme Court ruling that now makes it difficult for victims of discrimination to pursue claims.  The bill clarifies that every paycheck[…]