Texas Supreme Court to Review Eight-Corners Duty-to-Defend Rule

Judges standing behind bench

The Texas Supreme Court’s answer will have a significant impact on companies operating in Texas.

April 5, 2021
Jared De Jong - Payne & Fears

The Texas Supreme Court has accepted certified questions from the Fifth Circuit Court of Appeals to clarify Texas’ eight-corners rule for determining the existence of a duty to defend.

In Bitco Gen. Ins. Corp. v. Monroe Guar. Ins. Co., No. 19-51012, 2021 WL 955155 (5th Cir. Mar. 12, 2021), certified question accepted (Mar. 19, 2021), the Fifth Circuit asked the Texas Supreme Court to provide guidance on Texas insurance law. In Bitco, the insured was sued for negligently drilling an irrigation well. The insured allegedly got a drilling bit stuck in a bore hole, refused to fix the issue, and eventually abandoned the well. The policy did not cover continuing property damage known to the insured before the policy incepted. The policy period ran from Oct. 6, 2015 to Oct. 6, 2016, and the parties stipulated the drill bit became stuck in November 2014.

Mr. De Jong may be contacted at jdj@paynefears.com



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