Friday, February 24, 2012

Insurer Says There's No Duty To Defend Insured Home Seller In Suit Alleging He Knowingly Unloaded Home With Crappy Foundation On Unwitting Buyer

In Jefferson County, Texas, The Southeast Texas Record reports:

  • In a recently filed lawsuit, an insurance company alleges a homeowner lied about the condition of a house in a real estate transaction. Allstate Texas Lloyd's claims defendant Anthony Smith sold his home on Josey Street in Beaumont to defendants James and Cayla Huffman while representing that it was free from problems. However, the home's foundation had serious defects, according to the complaint filed Jan. 13 in Jefferson County District Court.

  • The Huffmans describe the home's problems as "patent defects," the suit states. They filed a lawsuit against Smith because of the problems, the complaint says. In their complaint, the Huffmans seek economic and mental anguish damages, according to Allstate's petition.

  • "The petition also alleges that Mr. Smith made material representations regarding the quality of the home that were not true and, further, that the misrepresentations are actionable because because they qualify as false, misleading and deceptive acts or practices under the Deceptive Trade Practices Act," the complaint says.

  • Smith made the comments to the Huffmans with the intent that they rely on the misrepresentations to purchase the home, according to the complaint. Allstate had insured the home for Smith and promised to provide defense for him in the event of bodily injury or property damage, the complaint says. However, the insurance company claims it should not be required to defend Smith in the Huffmans' lawsuit because there are no allegations of accidental conduct on his part.

  • In its complaint, Allstate is seeking a judgment that it has no duty to defend Smith or to pay any damages to Huffmans, plus other relief the court deems just.

For the story, see Bank accuses home seller of deceptive trade.

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