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"An insurance settlement and several years of litigation involving a mortgage lender eventually culminated in a jury award in Anita Keith's favor &Atilde;&macr;&Acirc;&iquest;&Acirc;&frac12; a $40,000 award meant to reimburse her for all the money she spent repairing her Hurricane Rita ravaged home. <br /><br />However, on Thursday, Nov. 25, Keith was forced back to square one, as Texas' Ninth Court of Appeals reversed the $40,000 jury award and remanded the case for a new trial.<br /><br />Court papers show that in September 2005, Hurricane Rita severely damaged Keith's home, forcing her to file a homeowners' insurance policy claim. After a six-month delay, she received an insurance draft for $24,894.60, which was made payable to Keith, her attorney and her mortgage company, Statewide.<br /><br />Under the deed of trust, Statewide had the right to receive any insurance proceeds paid to repair damage to Keith's home, court papers say. <br /><br />But Keith claimed her settlement money \"was wrongfully seized by Defendants Statewide and SN Servicing\" and filed a breach of contract lawsuit on April 4, 2006, in Jefferson County District Court.  <br /><br />Following a May 2008 trial, the jury found that Statewide breached the deed of trust and awarded Keith damages of $45,000.00 for the breach of contract. <br /><br />The jury verdict led Statewide to file an appeal in September 2008.<br /><br />On appeal, Statewide argued whether it breached its duties under the deed of trust to its mortgagor, and whether the evidence sufficiently supported the jury's award of $45,000.<br /><br />\"We hold that the evidence is sufficient to support the jury's finding that Statewide breached the deed of trust, but factually insufficient to support the $45,000 awarded by the jury for Keith's actual damages,\" states an opinion authored by Justice Hollis Horton.  <br /><br />\"We reverse the judgment and remand the cause for a new trial.\"<br /><br /><strong>Background</strong><br /><br />After receiving the settlement draft from the insurance company, Keith's attorney, Daniel Clayton, forwarded the draft to Statewide with instructions requesting that Statewide endorse the check and return it \"so as to pay expenses and begin repairs,\" court papers say. <br /><br />Instead, the funds were deposited into the account of Statewide's agent, SN Servicing, who is also a defendant in the suit. <br /><br />Although Keith sent the proceeds to the address Statewide had instructed its mortgagors to send mortgage payments, Statewide explained that payments received at that address were actually received by another bank with which it had a relationship. Its deposit relationship with the other bank required that funds sent to the designated address be deposited into an SNSC account for Statewide, court papers say.<br /><br />Court papers show that Statewide then proceeded to place the $24,894.60 in a suspense account, and did not try to contact Keith or her attorney regarding the circumstances leading to the insurer's payment. <br /><br />On March 9, 2006, when the endorsed check had not been returned, Keith's attorney called and spoke to a Statewide representative. Keith's attorney demanded that Statewide return the draft. On March 22, 2006, when the draft was not returned, Keith's attorney filed suit against Statewide and SNSC, court papers say.<br /><br />On April 14, 2006, shortly after filing an answer to the petition, the attorney for Statewide and SNSC sent Keith's attorney a letter that stated: \"My client is prepared to disburse the proceeds to Anita Keith and her contractor. Please provide me with the name of your client's contractor along with invoices for work done to repair the property or a contract for work to be done as soon as possible.\"<br /><br />In a letter dated April 17, 2006, Keith's attorney expressly rejected Statewide's requests, the opinion states.<br /><br />\"Later, when Keith responded to Statewide's discovery responses, Keith apparently produced invoices for work on her home,\" the opinion states. \"On September 18, 2006, after Statewide received Keith's invoices in discovery, SNSC sent Keith a check, in the amount of $13,394.03, an amount that is equal to the total sum for the invoices Keith indicated she had paid as of the date of her interrogatory answers.<br /><br />\"However, Keith's interrogatory responses also reflect that she had cleaned up debris, hauled off trees and removed damaged carpet, but she did not attach invoices or receipts reflecting amounts for which she sought reimbursement for her own work.\" <br /><br />On Sept. 21, 2006, Keith's attorney returned SNSC's check, and stated: \"My client will settle for nothing less than the full amount owed-attorney's fees, cost of court and interest as provided by law,\" the opinion states.<br /><br />The case has been remanded to Judge Gary Sanderson's 60th Judicial Court.<br /><br />Statewide is represented in part by attorneys Ray L. Vela and Bruce K. Thomas.<br /><br />Trial case No. B176-673<br />Appeals case No. 09-08-00413-CV<br />"^^<http://www.w3.org/2001/XMLSchema#string>
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