First State Bank v. Md. Cas. Co. - 918 F.2d 38 (5th Cir. 1990)

Rule:

While it is true that under Texas law the presumption is against a loss's being caused by the insured's wilful act, an insurer is entitled to overcome this presumption by circumstantial evidence.

Facts:

Plaintiff insured's executor sought to recover under a homeowner's insurance policy after the insured's home was destroyed in a fire. At trial, the insurance company introduced evidence showing that the insured’s house was unoccupied for several weeks prior to the fire but that a neighbor had seen a light in the home a few hours before the flames struck. The insurance company also introduced the testimony of a witness who, right before the fire started, saw a pickup truck leaving the road which accesses the residence. Only the insured had a key to the house, and the insured owned a pickup truck. The insurance company also showed that the insurance company was in financial trouble. Furthermore, the insurance company introduced as evidence the phone call made by the police to the insured's home during the fire. The dispatcher testified that when she called the insured there, an unidentified person replied that the insured person was not home. The trial court allowed the insurance company to introduce the evidence, over the objection of the plaintiff. The plaintiff moved for a directed verdict at the close of the company's case and moved for a j.n.o.v. at the trial's conclusion, arguing that the evidence, at best, showed that the insured only had a motive to combust his home and that this was insufficient to create a jury question. The jury found for the insurance company, and plaintiff appealed. 

Issue:

Under the circumstances, was it proper to deny insurance benefits to plaintiff insured’s executor? 

Answer:

Yes.

Conclusion:

On appeal, the court held that the district court did not abuse its discretion by admitting into evidence the phone call made by the police to the insured's home during the fire. The dispatcher's testimony that she dialed the correct number and that the person who answered the phone announced the right family name constituted sufficient authentication to make a prima facie case for the jury to decide the identity of the person who answered the phone. The court also found that the statement during the phone call that the insured was not home was admissible hearsay under Fed. R. Evid. 803(1) and Fed. R. Evid. 803(24). With regard to the denial of the plaintiff's motion for a JNOV, the court found that there was sufficient evidence to support the jury's verdict. The insurer offered proof required under Texas law of motive and of the incendiary origin of the fire. The court affirmed the judgment.