Northern District of Texas Rules Property Manager Has Insurable Interest in Managed, Non-Owned Commercial Units
By Erin K. Rutherford
In Samurai Global LLC v. Landmark Am. Ins. Co. the Insured’s commercial property consisting of forty two residential units was damaged by a tornado and subsequently by vandalism, theft and moisture in the following months after the tornado. The Insured filed two lawsuits, one for the tornado damage and one for the vandalism and theft related damages. The Northern District of Texas consolidated the cases and the Insurer moved for summary judgment contending that the Insured could not provide the existence of an insurable interest in the thirty three units on the property that it did not own and managed on behalf of investor owners. The record indicated that that the time the Policy was issued and at the time of the losses the Insured owned nine of the forty two units on the property and managed and rented out the remaining thirty three units. The Insured argued that they maintained a pecuniary interest on behalf of the thirty three non-owned units on behalf of the investor owners.
The Northern District of Texas, Dallas Division denied in part and granted in part each party’s motion for summary judgment. The Court found that Samurai had an insurable interest in both their owned units and their managed but non-owned units. The court then found the tornado damage and the post-tornado damage to be two separate occurrences under the policy’s definition of “occurrence” because the non-tornado damage occurred more than 72 hours after the tornado but that a question of material fact existed as to whether Samurai’s policy covered the subsequent damages.
Samurai Glob., LLC v. Landmark Am. Ins. Co., No. 3:20-CV-3718-D, 2024 U.S. Dist. LEXIS 76347 (N.D. Tex. Apr. 26, 2024).
Private: Erin K. Rutherford