author: KAREN ANGELINI, Justice.

text:
    FIRST PROFESSIONALS INSURANCE COMPANY, INC., Appellant, v. HEART & VASCULAR INSTITUTE OF TEXAS, Appellee.
    No. 04-05-00028-CV.
    Court of Appeals of Texas, San Antonio.
    Oct. 5, 2005.
    Rehearing Overruled Nov. 1, 2005.

      From the 57th Judicial District Court, Bexar County, Texas, Trial Court No. 2004-CI-03755; Lori Massey, Judge Presiding.

    R. Brent Cooper, Diana L. Faust, Devon J. Singh, Cooper & Scully, P.C., Dallas,
    Terri S. Harris, Ewbank & Byrom, P.C., Austin, for appellant.
    George H. Spencer, Jr., Paul A. Fleck, Clemens & Spencer, P.C., San Antonio, for appellee.
    Sitting: CATHERINE STONE, Justice, KAREN ANGELINI, Justice, REBECCA SIMMONS, Justice.

      . The Honorable Janet Littlejohn presided over the summary judgment hearing and entered an order resolving all issues except the amount of attorney's fees to be awarded. The Honorable Lori Massey entered the final judgment after resolving the attorney’s fees issue.

   OPINION

Opinion by

KAREN ANGELINI, Justice.

The issue presented in this appeal is whether under a claims-made policy, timely notice of separate claims made against two physicians practicing in the same medical group constituted timely notice of a claim against the group when: (1) the notice of claim forms identified the group as the insured; (2) the letters containing the claims against the two physicians were attached to the notice of claim forms; and (3) the letters stated that the claims were made for the medical care of the same decedent whose care was the basis of the claims against the two physicians and the group in a subsequent lawsuit. The trial court determined that the notice of the claims made against the physicians was sufficient notice of a claim against the group. We reverse the trial court’s judgment, render judgment that Heart & Vascular Institute of Texas take nothing against First Professionals Insurance Company, Inc., and remand the cause to the trial court for further proceedings consistent with this opinion.

Background

Heart & Vascular purchased a claims-made policy from First Professionals covering the policy period from April 1, 2002 to April 1, 2003. Heart & Vascular is listed as the first named insured, and various physicians were listed as additional insureds. The policy provided that a claim is made “on the date we receive, at our home office, your first written report to us of your receipt of written notice of a liability claim or intent to sue.” . In order for a claim to be covered, the claim “must be made for the first time during the policy period.” In the definitions section of the policy, the term “you and your” are defined as referring to “the named individual or group.” Coleman Company was designated as the sole agent to act on behalf of the insureds- under the policy. The policy was serviced on behalf of First Professionals by American Physicians Management Consulting Insurance Services f/k/a American Physician Insurance Services (“APMC”).

On March 3, 2003, Coleman received a claim from Heart & Vascular in the form of a 4590i letter dated February 27, 2003, notifying Dr. Stephen C. Carey'of a health care liability insurance claim against him for the medical care of Kenneth MacIn-tyre, Deceased. On March 4, 2003, Coleman forwarded a notice of claim form to APMC listing Heart & Vascular as the insured and attaching a copy of the letter. Dr. Carey is listed as an additional insured under the policy.

On March 6, 2003, Coleman received an additional claim from Heart & Vascular in the form of a 4590i letter dated February 27, 2003, notifying Dr. Richard Wilks of a health care liability insurance claim against him for his medical care of the same decedent, Kenneth MacIntyre. On March 6, 2003, Coleman forwarded another notice of claim form to APMC, again listing Heart & Vascular as the insured and attaching a copy of the letter. Dr. Wilks is also listed as an additional insured under the policy. In this second notice of claim form, Coleman included the following in the description of the occurrence: “THIS TIME THEY ARE NAMING A DIFF. DOCT (DR. RICHARD WILKS, M.D.).” Also, in the remarks, Coleman included the following: “THIS IS SECOND NOTICE FOR DIFF DOCTOR ON SAME DECEASED.”

On March 19, 2003, Jan Jonas, an agent with Coleman, sent an e-mail to Barbara Kounelias, a representative of APMC, noting that Heart & Vascular wanted to know “if the Institute has been implicated by this claim in any way.” Later that same day, Jonas forwarded the same e-mail request to Kounelias because she had not received a response. Kounelias responded that Mark Keeney was handling that claim and provided Jonas with Keeney’s e-mail address. Jonas forwarded her e-mail request to Keeney. On March 20, 2003, Keeney responded that Kounelias was handling the claim. Jonas responded to Keeney, stating that Kounelias had provided his name as handling the claim.

On March 24, 2003, a lawsuit was filed for negligence in MacIntyre’s medical care. Heart & Vascular is listed as a defendant with the notation that Dr. Carey is and was an agent, servant, and employee of Heart & Vascular. The body of the petition alleges various negligent actions by Dr. Carey and other defendants; however, no specific action by Heart & Vascular is listed.

On May 2, 2003, Vicky Gould, Vice-President of APMC, sent a letter to Heart & Vascular. In her letter, Gould stated that on May 2, 2003, Heart & Vascular reported that it was served with the March 24, 2003 lawsuit. Gould further stated that the First Professionals’ policy was a claims-made policy, and Heart & Vascular did not make the claim during the period in which coverage existed.

On February 23, 2004, Gould responded to an additional letter sent by Heart & Vascular’s attorney. Gould’s letter acknowledged that both Heart & Vascular and the individual physicians within the group were insureds under the policy. Gould concluded, however, that the group and the individual physicians are “treated as separate named insureds and the notice requirement under the policy applies to each named insured. Therefore, even though the two physicians timely gave notice of their claims under the policy, there is no policy language or ease law that we are aware of which constitutes timely notice of [Heart & Vascular’s] claim.” Gould noted that Heart & Vascular declined to purchase tail endorsement or extended reporting endorsement at the end of the claims-made policy period.

On March 9, 2004, Heart & Vascular filed suit against First Professionals seeking a declaratory judgment that First Professionals had a duty to defend the claim against Heart & Vascular. First Professionals filed a counter-claim seeking a declaratory judgment that Heart & Vascular failed to notify First Professionals of the claim against it during the policy period. The parties then filed competing motions for summary judgment. The trial court entered judgment in favor of Heart & Vascular, ordering First Professionals to defend Heart & Vascular in the lawsuit filed on March 24, 2003, and awarding Heart & Vascular attorneys’ fees “in such amounts as are determined in further proceedings in this action.” The trial court subsequently entered a final judgment after determining the amount of attorney’s fees to be awarded to Heart & Vascular.

Standard of Review

The party moving for summary judgment carries the burden of establishing that no material fact issue exists and that it is entitled to judgment as a matter of law. Rhone-Poulenc, Inc. v. Steel, 997 S.W.2d 217, 223 (Tex.1999). When reviewing a summary judgment, we take as true all evidence favorable to the nonmovant. Id. We indulge every reasonable inference and resolve any doubts in the nonmovant’s favor. Id. When competing motions for summary judgment are filed, and one is granted and the other denied, the reviewing court must review the summary judgment evidence presented by both sides and determine all questions presented. Commissioners Court of Titus County v. Agan, 940 S.W.2d 77, 81 (Tex.1997).

Interpretation of Insurance Policies

The general rules of contract construction govern insurance policy interpretation. Grain Dealers Mut. Ins. Co. v. McKee, 943 S.W.2d 455, 458 (Tex.1997); General Agents Ins. Co. v. Arredondo, 52 S.W.3d 762, 766 (Tex.App.-San Antonio 2001, pet. denied). ‘Whether a contract is ambiguous is a question of law that must be decided by examining the contract as a whole in light of the circumstances present when the contract was entered.” Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd., 940 S.W.2d 587, 589 (Tex.1996); see also Arredondo, 52 S.W.3d at 766. A contract is unambiguous as a matter of law if it can be given a definite or certain legal meaning. Columbia Gas, 940 S.W.2d at 589; Arredondo, 52 S.W.3d at 766. Conversely, if an insurance contract is subject to more than one reasonable interpretation, the contract is ambiguous and the interpretation that most favors coverage for the insured will be adopted. McKee, 943 S.W.2d at 458; Arredondo, 52 S.W.3d at 766. An ambiguity does not arise simply because the parties advance conflicting interpretations of the contract. McKee, 943 S.W.2d at 458; Arredondo, 52 S.W.3d at 766.

The two primary types of insurance policies are claims-made policies and occurrence policies. The distinction between these two types of policies is explained as follows:

The major distinction between the “occurrence” policy and the “claims made” policy constitutes the difference between the peril insured. In the “occurrence” policy, the peril insured is the “occurrence” itself. Once the “occurrence” takes place, coverage attaches even though the claim may not be made for some time thereafter. While in the “claims made” policy, it is the making of the claim which is the event and peril being insured and, subject to the policy language, regardless of when the occurrence took place.

Hirsch v. Texas Lawyers’ Ins. Exchange, 808 S.W.2d 561, 563 (Tex.App.-El Paso 1991, writ denied). In sum, claims-made policies are reporting policies. Id. at 565 (quoting Gulf Ins. Co. v. Dolan, Fertig and Curtis, 433 So.2d 512 (Fla.1983)). If the claim is reported to the insurer during the policy period, then the carrier is legally obligated to pay. Id.

The policy in question is unambiguous in stating that coverage is provided when claims are “made for the first time during the policy period.” The issue becomes whether Heart & Vascular made a claim during the policy period based on the notices of claim filed on March 4, 2003, and March 6, 2003. Because the evidence regarding the notices that were sent to APMC is undisputed, the issue of whether a claim was timely made is a question of law. See Employers Cas. Co. v. Glens Falls Ins. Co., 484 S.W.2d 570, 576 (Tex.1972).

Analysis

The primary case relied upon by First Professionals is Texas Medical Liability Trust v. Transportation Ins. Co., 143 S.W.3d 335 (Tex.App.-Dallas 2004, pet. filed). The analysis in that case is largely governed by the former article 4590i notice requirement.

In Texas Medical Liability Trust, TMLT insured the Medical & Surgical Clinic of Irving, P.A. and Dr. John Wollen-man, a partner of the Clinic, under separate policies. Id. at 336. The policies were claims-made policies that expired on September 1, 1996. Id. On July 2, 1996, Dr. Wollenman received a 4590i notice letter informing him that claims were being considered against him for actions taken during the delivery of a child. Id. The letter made no mention of a possible claim against the Clinic. Id. A Clinic employee faxed the letter to TMLT on July 3, 1996. Id.

On May 28, 1999, notice of claim letters were sent to both Dr. Wollenman and the Clinic regarding the same claim. Id. The notice of claim letter sent to Dr. Wollen-man was forwarded by a Clinic employee to TMLT. Id. The notice of claim letter sent to the Clinic was forwarded to Transportation Ins. Co., the Clinic’s insurer on May 28, 1999. Id. After the lawsuit was settled, Transportation filed a lawsuit seeking a declaration that TMLT was liable for the Clinic’s portion of the settlement. Id. at 3B6.

The Dallas court began its analysis by noting that article 4590i required a person asserting a health care liability claim to give notice to each physician or health care provider, including professional associations, against whom the claimant asserts liability. 143 S.W.3d at 337. Transportation asserted that the July 1996 letter constituted notice of a claim against the Clinic under the TMLT policy because the term “named insured” included proprietary members, like Dr. Wollenman, for whose acts the Clinic is vicariously liable. Id. at 338. The Dallas court rejected this argument because the petition was the first document alleging that the Clinic was vicariously liable for the actions of Dr. Wollenman, not the July 1996 notice letter. Id.

Transportation then sought to rely on article 1528f, section 24 of the Professional Associations Act to argue that the Clinic was automatically liable for the acts of Dr. Wollenman; therefore, notice of a claim against Dr. Wollenman is the same as notice of a claim against the Clinic. Id. The Dallas court rejected that argument relying on a case in which a plaintiff sought to use section 24 to extend the two year limitations provision for medical malpractice claims. Id. (citing Durham Clinic, P.A v. Barrett, 107 S.W.3d 761, 764 (Tex.App.-Waco 2003, pet. denied)). The Dallas court noted that although section 24 allowed a claim to be brought against a dissolved association within three years, section 24 could not be used to extend the absolute two year limitations period for health care liability claims in article 4590L Id. Similarly, the Dallas court reasoned that section 24 could not be used to circumvent article 4590i’s requirement that each health care provider receive notice of a claim. Id.

Transportation has filed a petition for review with the Texas Supreme Court. In its petition, Transportation argues that the receipt of a 4590i notice letter is unrelated to the submission of liability insurance claims. Transportation contends that the effect of the Dallas court’s opinion is to require that a health care provider be in receipt of a 4590i notice letter before a claim can be made under a claims-made policy. Transportation also believes the Dallas court misunderstood its argument under article 1528f, section 24. Transportation contends that it was not asserting that section 24 “trumped” the 4590i notice requirement. Instead, Transportation asserts that “even if an association has not yet received a 4590i notice letter naming it as a potential defendant, if an association receives such a notice directed to one of its employees, that is sufficient to invoke coverage under its professional liability policy” because the professional association is statutorily liable for the medical malpractice of its employees. Transportation argues that by statute the Clinic was vicariously liable for Dr. Wollenman’s actions even if the plaintiff did not make a direct assertion against the Clinic in the 4590i letter.

Heart & Vascular attempts to distinguish the Dallas court’s decision in Texas Medical Liability Trust (“TMLT”) on three primary grounds: (1) separate policies were issued for the physician and the Clinic in TMLT, while the instant case involves only one policy; (2) the notice/report in TMLT only referred to the physician while the notice of claim in the instant case named Heart & Vascular as the insured; and (3) the “Named Insured” in the policy in question in TMLT was limited to the Clinic and only covered individual physicians to the extent they were vicariously liable for others. The Dallas court’s opinion provides only the following portion of the definition of “Named Insured”:

“Named Insured ” means the professional association, partnership or other physicians’ [physicians] practice group so designated in the applicable Declarations Page of this policy. Any partner, shareholder, associate, officer, director or other proprietary member of such insured while acting within the scope of duties for such insured shall be included within the coverage afforded to the Named Insured, but only with respect to vicarious liability for acts or omissions of others in the practice of medicine ....

143 S.W.3d at 337 (emphasis in original). In applying the definition, Transportation argued that the term “includes proprietary members for whose acts the Clinic is vicariously liable.” Id. at 338. The Dallas court, however, noted “it is the petition in the underlying medical malpractice action that first claimed the Clinic was vicariously liable for the actions of Dr. Wollenman, not the July, 1996 notice letter received by the Clinic.” Id. Based on this statement, we do not believe that Heart & Vascular’s reasons for distinguishing TMLT are convincing. The Dallas court was not focused on the fact that separate policies existed but on the fact that no claim against the Clinic was raised in the first letter. Similarly, the Dallas court was not focused on whether the Clinic’s name appeared in the July 1996 letter but on whether a claim had been asserted against the Clinic.

Heart & Vascular further asserts that First Professionals was timely provided with all the necessary information, i.e.: “A claim was being made regarding the medical care given to Mr. MacIntyre by two physicians who were insureds under the policy and those two physicians and the Insured Doctors Group (which by law is vicariously liable for their acts and omissions) were looking to the Insurance Company to provide them with a defense and the coverage they had purchased.” Heart & Vascular appears to be making an argument similar to the one made in TMLT based on article 1528f, section 24. Although article 1528f, section 24 may automatically impose vicarious liability on a professional association, reliance on section 24 to trigger coverage under a claims made policy ignores that the plaintiff must affirmatively seek to recover from the association before the association can have notice of a liability claim against it or notice of the plaintiffs intent to sue it. While we disagree with the Dallas court’s implication in TMLT that the plaintiffs claim must be in the form of a 4590i notice letter (although it typically will be), case law is clear that vicarious liability is a separate theory of liability. See, e.g., Puls v. Columbia Hosp. at Medical City Dallas Subsidiary, L.P., 92 S.W.3d 613, 618 (Tex.App.-Dallas 2002, pet. denied) (amended pleading alleged health care liability claim for vicarious liability for first time); Robertson v. Church of God, Int’l, 978 S.W.2d 120, 124 (Tex.App.-Tyler 1997, pet. denied) (noting pleading only alleged direct liability claim not claim for vicarious liability); Wehmeyer v. O’Dell, 856 S.W.2d 845, 847 (Tex.App.-Eastland 1993, writ denied) (noting plaintiffs trial pleadings contained no allegations of vicarious liability); Griggs v. Capitol Mach. Works, Inc., 690 S.W.2d 287, 295 (Tex.App.-Austin 1985), writ ref'd n.r.e., 701 S.W.2d 238 (Tex.1985) (noting that no pleading was filed suggesting any theory of vicarious liability); Ramirez v. Arguindegui Oil Co., 562 S.W.2d 524, 526 (Tex.Civ.App.-San Antonio 1978, no writ) (noting that nothing in the petition could serve as basis for imposing vicarious liability on the defendant). Until the plaintiff asserts that theory of liability, there is no new claim or lawsuit “made against Heart & Vascular Institute of Texas (T5266) as a result of the acts or omissions of the indi-viduar’ physicians to which coverage extends under the policy. At that point, vicarious liability is only a “potential” claim which may be asserted against Heart & Vascular in the future.

Heart & Vascular relies heavily on the Texas Supreme Court’s opinion in Glens Falls. In that case the question was whether written notice of a liability event under an occurrence policy inured to the benefit of the omnibus insureds. 484 S.W.2d at 574. The court noted that the purpose of the notice requirement, to enable an insurer to investigate while the matter is fi*esh in the minds of the witnesses, was served by the notice that was given. Id. The court held:

We hold that the timely notice of the accident from its named insured complied with the contract provision of the policy and the purpose to be served by such provision, and that another notice of the same accident was not required of the omnibus insureds. To hold otherwise, as contended by Glens Falls, would permit it to escape liability on a technicality which had no relation to its ability to promptly investigate the accident and prepare to defend and satisfy any claims then or thereafter asserted against the omnibus insureds.

Id. at 575.

Although noting the distinctions that can be made between Glens Falls and the instant case, most notably that the policy in Glens Falls was an occurrence policy, Heart <& Vascular argues that the distinctions are irrelevant to “the considerations which caused the Supreme Court to rule as it did.” Heart & Vascular’s argument continues, “Specifically, as suggested by the Supreme Court, an insurance company is not ‘more notified’ of a liability event involving the same claimant if the insurance company receives notice of those things a second, third, fourth, fifth, or sixth time.” While this is a correct statement, it ignores that the “liability event” is not the triggering event for coverage under a claims-made policy. In a “claims made” policy, it is the making of the claim which is the event and peril being insured. Hirsch, 808 S.W.2d at 568. Accordingly, notice of the “liability event” is not relevant in determining whether coverage is triggered under a “claims made” policy. An insurance company could have received notice on six separate occasions of a liability event; however, until a claim is made based on that liability event, coverage is not triggered.

Finally, Heart & Vascular appears to contend that a claim against either the individual physicians or the group is sufficient to trigger the coverage for both. Heart & Vascular argues in its brief:

The policy language continues by providing that “a claim is made on the date we [that is, the Insurance Company] receive, at our home office, your [that is, the named individual’s (Drs.Car-ey/Wilks) or the group’s (the Insured Doctors Group) ] first written report to us of your [that is, the named individuals (Drs. Carey and Wilks) or the group’s (the Insured Doctors Group) ] receipt of written notice of a liability claim or intent to sue.”

Again, Heart & Vascular seeks to focus on the fact that notice was provided of a liability “event” to extend coverage to Heart & Vascular; however, the policy focuses on liability “claims.” Notice of a liability claim against Heart & Vascular cannot be provided until after the liability claim is made. The 4590i notice letters in this case did not assert a liability claim against Heart & Vascular; therefore, those notice letters could not provide written notice of a liability claim or intent to sue Heart & Vascular.

Although we disagree with the Dallas court’s implication that a claims-made policy can only be triggered by a 4590i notice letter, we agree that coverage of Heart & Vascular under First Professionals’ policy could not be triggered until the plaintiffs asserted a claim against Heart & Vascular. The assertion of claims against the individual physicians in the Heart & Vascular group was not sufficient. As the El Paso court has explained:

Although the notice requirements of a “claims made” policy appear to be harsh, the ability to make a choice based on need and financial ability is in the public interest. We must not convert claims-made policies to occurrence policies by judicial acts. The policies in question are “clear, unequivocal and hence unambiguous” and therefore its terms are enforceable.

Hirsch, 808 S.W.2d at 565.

Conclusion

Because no claim was asserted against Heart & Vascular in the 4590i notice letters sent to Dr. Carey and Dr. Wilks, the notice provided to First Professionals regarding those letters was not notice of a claim against Heart & Vascular. Accordingly, the trial court erred in rendering judgment in favor of Heart & Vascular. The portion of the trial court’s judgment relating to liability as between Heart & Vascular and First Professionals is reversed, judgment is rendered that Heart & Vascular take nothing against First Professionals, and the cause is remanded to the trial court for further proceedings consistent with this opinion on the issue of attorney’s fees and costs.

      . First Professionals also asserted a cross-claim against Coleman and Jonas, asserting they were liable for Heart & Vascular’s failure to purchase a tail policy. The final judgment dismissed all claims against Coleman and Jonas without prejudice.

      . Heart & Vascular asserts in its brief that a general rule of construction is to construe the insurance policy against the. insurance company and in favor of the insured and the existence of coverage. This rule of construction only applies, however, if the insurance contract is subject to more than one reasonable interpretation, meaning the contract is ambiguous.


source: Caselaw Access Project

author: CATHERINE STONE, Justice.

license: Public Domain

text:
    PATTERSON-UTI DRILLING COMPANY LP, LLLP, Patterson UTI Drilling (South) LP, LLP, and UTI Drilling LP, Appellants, v. WEBB COUNTY APPRAISAL DISTRICT, Appellee.
    No. 04-05-00125-CV.
    Court of Appeals of Texas, San Antonio.
    Oct. 5, 2005.

      Ron Patterson, Kliewer, Breen, Garato-ni, Patterson & Malone, San Antonio, for appellants.
    Dylan Wood, Ray, Wood & Bonilla, L.L.P., Austin, for appellee.

      Sitting: CATHERINE STONE, Justice, KAREN ANGELINI, Justice, REBECCA SIMMONS, Justice.
   OPINION

Opinion by

CATHERINE STONE, Justice.

This is an appeal from a judgment in favor of appellee, Webb County Appraisal District, in which the trial court determined that two mobile oil drilling rigs owned by appellants, Patterson-UTI Drilling LP, LLLP, Patterson UTI Drilling (South') LP, LLP, and UTI Drilling LP (collectively “Patterson Drilling”), are subject to taxation in Webb County, Texas for the 2002 tax year. We reverse the trial court’s judgment and render judgment that Patterson Drilling owes no tax to Webb County for the year 2002 because Patterson Drilling’s property is taxable at its principal place of business in Scurry County, Texas, not at its temporary location in Webb County.

Background

The parties tried this case upon an agreed statement of facts pursuant to Texas Rule of Civil Procedure 263. Patterson Drilling drills oil and gas wells for hire throughout Texas and the United States. The company’s principal place of business is located in Snyder, Scurry County, Texas. The company currently operates more than 325 drilling rigs, most of which are taxable as personal property in Texas.

Patterson Drilling’s customers’ requirements determine the location of a drilling rig at any given time. Patterson Drilling’s rigs constantly move from job site to job site, with each job taking “a couple of weeks to a maximum of five months to complete.” The company does not know where a rig will go upon the completion of a job unless it secures an advance contract for the rig. When Patterson Drilling does not secure an advance drilling contract for a rig, the rig remains idle at its last job site until Patterson contracts for the next job.

On January 1, 2002, two of Patterson Drilling’s rigs, Rig Nos. 27 and 533, were located in Webb County. Rig No. 27 had been in Webb County for approximately 159 days when January 1, 2002 arrived, while Rig No. 533 had been in Webb County for approximately 175 days. Both rigs had recently completed projects in Webb County and were idle because Patterson had not yet secured drilling contracts for the rigs. As of January 1, 2002, Rig No. 27 had been idle for 40 straight days while Rig No. 533 had been idle for 68 straight days.

Patterson Drilling rendered Rig Nos. 27 and 533 for taxation at its principal place of business in Scurry County for the 2002 tax year. Webb County, however, also placed Rig Nos. 27 and 533 on its appraisal roll for the 2002 tax year. As a result, Rig Nos. 27 and 533 were on the appraisal roll in two separate appraisal districts for the 2002 tax year and were subject to double taxation by the taxing units of Scurry and Webb Counties.

In light of the agreed facts, the trial court concluded that Patterson Drilling’s rigs had remained in Webb County for more than a temporary period on January 1, 2002. Consequently, the court determined Rig Nos. 27 and 533 were subject to taxation in Webb County for the 2002 tax year, not Scurry County. This appeal by Patterson Drilling ensued.

STANDARD OF REVIEW

Rule of Civil Procedure 263 provides for presentation of a case to the trial court on stipulated facts. See Tex.R. Civ. P. 263. “A case submitted under rule 263, like a special verdict, is a request by the parties for judgment in accordance with the applicable law.” SLW Aviation, Inc. v. Harris County Appraisal Dist, 105 S.W.3d 99, 102 (Tex.App.-Houston [1st Dist.] 2003, no pet.). There are no presumed findings in favor of the judgment in a case submitted under rule 263 because the trial court had no factual issues to resolve. Id. The only issue to resolve on appeal is whether the trial court correctly applied the law to the agreed facts. Id. Our review is de novo in an agreed case because the issue before us is purely a question of law. Id.

Discussion

The issue on appeal is whether Webb County is the proper tax situs for Rig Nos. 27 and 533, which were located in Webb County on January 1, 2002. Patterson Drilling submits that Rig Nos. 27 and 533 remained only temporarily in Webb County on January 1, 2002, and therefore could not have attained situs there for tax purposes. Patterson Drilling relies on section 21.02(a)(4) of the Tax Code and contends that the proper tax situs for the rigs is Scurry County, where the company’s principal office is located. See Tex. Tax Code Ann. § 21.02(a)(4) (Vernon 2001). The Webb County Appraisal District, on the other hand, relies on section 21.02(a)(1) of the Tax Code and asserts that the taxable situs of Rig Nos. 27 and 533 is in Webb County because the rigs were in Webb County for “more than a temporary period.” See id. § 21.02(a)(1).

As a general rule, “jurisdiction to tax exists based on the length of time property is located in the taxing unit within Texas.” Fairchild Aircraft, Inc. v. Bexar Appraisal Dist., 47 S.W.3d 577, 580 (Tex.App.-San Antonio 2001, pet. denied). Section 21.02 of the Texas Tax Code provides:

(a) [Except for certain inapplicable exceptions,] tangible personal property is taxable by a taxing unit if:
(1) it is located in the unit on January 1 for more than a temporary period;
(2) it normally is located in the unit, even though it is outside the unit on January 1, if it is outside the unit only temporarily;
(3) it normally is returned to the unit between uses elsewhere and is not located in any one place for more than a temporary period; or
(4) the owner resides (for property not used for business purposes) or maintains his principal place of business in this state (for property used for business purposes) in the unit and the property is taxable in this state but does not have a taxable situs pursuant to Subdivisions (1) through (3) of this section.

Tex. Tax Code Ann. § 21.02(a). The Tax Code, however, does not define what constitutes “more than a temporary period.” Thus, in order to resolve this appeal, we must first determine the meaning of the term “temporary.”

When we construe a statute, our objective is to determine and give effect to the legislature’s intent. City of San Antonio v. City of Boerne, 111 S.W.3d 22, 25 (Tex.2003). “ Where language in a statute is unambiguous, this court must seek the intent of the legislature as found in the plain and common meaning of the words and terms used.’ ” Monsanto Co. v. Cornerstones Mun. Util. Dist., 865 S.W.2d 937, 939 (Tex.1993). If the legislature has failed to define a word or term, we will apply its ordinary meaning. Id. “In applying the plain and common meaning of the language in a statute, courts may not by implication enlarge the meaning of any word in the statute beyond its ordinary meaning; such implication is inappropriate when legislative intent may be gathered from a reasonable interpretation of the statute as it is written.” Sorokolit v. Rhodes, 889 S.W.2d 239, 241 (Tex.1994).

Because the legislature has not defined the term “temporary” as it is used in section 21.01(a), we apply its ordinary meaning. ■ Black’s Law Dictionary defines “temporary” as “lasting for á time only; existing or continuing for a limited (usu.short) time; transitory.” Black’s Law Dictionaey 1504 (8th ed.2004). Webster’s Dictionary likewise defines “temporary” as “lasting for a limited time.” Webster’s NINTH NEW COLLEGIATE DICTIONARY 1214 (9th ed.1990). Accordingly, we hold the language used by the legislature in section 21.02(a)(1) is clear and unambiguous: property is taxable by a taxing unit if it is located in the unit on January 1 for more than a limited time. Having resolved this preliminary matter, we now must determine whether the trial court correctly applied section 21.02(a)(1) of the Tax Code to the agreed facts.

The agreed facts in this ease establish that Rig Nos. 27 and 583 are constantly moved from one temporary location to another. As Patterson Drilling’s projects are completed, the mobile drilling rigs remain idle at the job site until needed by Patterson at another location. The agreed facts therefore show that Patterson’s rigs are not taxable in Webb County under section 21.02(a)(1) because the rigs were at their January 1, 2002 location only temporarily. Therefore, we hold that the trial court failed to correctly apply the law to the agreed facts because the rigs are taxable at Patterson Drilling’s principal place of business in Scurry County pursuant to section 21.04(a)(4), not in Webb County pursuant to section 21.02(a)(1).

The Webb County Appraisal Board argues that the agreed facts demonstrate Rig Nos. 27 and 533 were in Webb County for more than a temporary period because both rigs stayed in Webb County until January 1, 2003. Although the agreed facts demonstrate that Patterson Drilling eventually secured contracts to keep Rig Nos. 27 and 533 in Webb County until January 1, 2003, such events are irrelevant to our taxable situs inquiry. As noted by Patterson Drilling, events occurring after January 1 of the applicable tax year are irrelevant to the question of taxable situs under section 21.02 because the situs of tangible personal property is determined by looking back in time to the location of the property in the year preceding January 1 of the applicable tax year. See generally Fairchild Aircraft, Inc., 47 S.W.3d at 580-82 (holding an aircraft’s status as “commercial” is determined based on property’s use over the year preceding January 1 of the applicable tax year because determining the status of personal property based on the property’s use over the preceding tax year is consistent with Chapter 21 of the Tax Code).

Conclusion

Based on the foregoing, we reverse the trial court’s judgment and render judgment that Patterson Drilling owes no tax to Webb County for the year 2002 because Patterson’s property is taxable at its principal place of business in Scurry County, Texas, not at its temporary location in Webb County.

      . Patterson Drilling eventually entered contracts for Rig Nos. 27 and 533, which kept the rigs in Webb County throughout 2002. Rig No. 27 did not restart its drilling operations in Webb County until February 5, 2002 while Rig No. 533 was idle until April 26, 2002.

      . See Tex. Tax Code Ann. § 21.02(a)(1). The Webb County Appraisal District urges this court to define temporary using a fixed number of days. Specifically, the Appraisal District asks that we define temporary as existing in a location for no more than 175 days. See generally Tex Const, art. VIII § 1-j (“To promote economic development in the State, goods, wares, merchandise, other tangible personal property, and ores, other than oil, natural gas, and other petroleum products, are exempt from ad valorem taxation if ... the property is transported outside of this State not later than 175 days after the date the person acquired or imported the property in this State”). If the legislature had wanted to define temporary using a fixed number of days, however, it could easily have done so by drafting the statute in such a manner. Because courts are to read every word, phrase, and expression as if it were deliberately chosen and presume that words excluded from the statute were excluded purposefully, we decline to adopt the Appraisal District’s 175-day definition for the term temporary. Gables Realty Ltd. P’ship v. Travis Cent. Appraisal Dist., 81 S.W.3d 869, 873 (Tex.App.-Austin 2002, pet. denied).

      . We note that the Thirteenth Court of Appeals recently decided Aransas County Appraisal District v. Patterson-Uti-Drilling(South) Lp, Lllp, No. 13-04-00502-CV, 2005 WL 2046244 (Tex.App.-Corpus Christi Aug. 26, 2005, no pet. h.), which involved a factual situation similar to the one at issue here. The main factual distinction between the cases is that the trial court in Aransas County reached the opposite conclusion than the trial court did in this case, i.e., the trial court concluded that Patterson’s property was taxable at its principal place of business in Scurry County. 2005 WL 2046244 at *1. On appeal, the Thirteenth Court of Appeals affirmed the trial court’s judgment because the court concluded that it had no authority to consider the appellants' sole issue concerning the sufficiency of the evidence. Id. *1-2 (citing City of Harlingen v. Avila, 942 S.W.2d 49, 51 (Tex.App.-Corpus Christi 1997, writ denied)). Although we agree with our sister court’s result affirming the trial court’s judgment, we disagree with some of the court’s reasoning; therefore, we decline to adopt the views expressed by the Thirteenth Court of Appeals in Aransas County.


author: SANDEE BRYAN MARION, Justice. CATHERINE STONE, Justice,

text:
    SERVICE LLOYD’S INSURANCE COMPANY d/b/a Service Casualty Insurance Company, Appellant, v. J.C. WINK, INC. d/b/a Americars, Appellee.
    No. 04-05-00038-CV.
    Court of Appeals of Texas, San Antonio.
    Oct. 5, 2005.

      From the 166th Judicial District Court, Bexar County, Texas, Trial Court No. 2004-CI-00708; Martha Tanner, Judge Presiding.

    Robert D. Allen, Robert L. Berry, Baker & McKenzie, L.L.P., Dallas, for appellant.
    Grace S. Bellomy, J. Ken Nunley, Nun-ley Davis Jolley Cluck Aelovoet L.L.P., Boerne, for appellee.
    Sitting: CATHERINE STONE, Justice, KAREN ANGELINI, Justice, SANDEE BRYAN MARION, Justice.

      . The Honorable Pat Boone of the 57th Judicial District Court, Bexar County, Texas signed the order that is the basis of this appeal.

   OPINION

Opinion by

SANDEE BRYAN MARION, Justice.

Service Lloyd’s Insurance Company brings this appeal from a judgment declaring that the company has a duty to defend one of its insureds, J.C. Wink., Inc., in a class action lawsuit brought against the insured by its former customers. We affirm the trial court’s judgment to the extent that it concludes Service Lloyd’s owes J.C. Wink a defense in the underlying class action lawsuit. However, we reverse the trial court’s judgment to the extent that it concludes J.C. Wink has a valid claim for penalties and attorney’s fees based upon Service Lloyd’s alleged violation of article 21.55 of the Texas Insurance Code. Accordingly, we render judgment that J.C. Wink take-nothing on its article 21.55 claim.

Background

J.C. Wink. Inc. (“Wink”) is an auto dealership. During the course of its operations, it obtained a commercial general liability insurance policy from Service Lloyd’s Insurance Company (“SLIC”). This liability policy, together with two consecutive policy renewals, provided insurance coverage for Wink from September 1997 through September 2000. The policy issued to the dealership provided errors and omissions (“E & O”) coverage. Under the policy, SLIC is obligated to provide Wink a defense whenever Wink is accused of negligently violating any federal, state, or local truth-in-lending law.

Wink, and approximately seventeen other auto dealerships, were eventually sued by a class of their former customers in September of 2002. The plaintiffs’ petition alleges that, as a part of the purchase of their automobiles, Wink overcharged them in various ways. The petition claims Wink’s conduct constitutes, among other things, a violation of the provisions of the Texas Finance Code known as the Motor Vehicle Installment Sales Act.

Wink, believing the underlying suit accused it of committing violations of state truth-in-lending laws, notified SLIC and requested a defense pursuant to the E & O provisions of its policy. SLIC, however, refused to tender a defense to Wink because it believed the factual allegations in the plaintiffs’ class action petition failed to state a claim for violations of any federal, state, or local truth-in-lending laws. Wink subsequently filed a declaratory judgment action, seeking a declaration that SLIC owes it a defense in the underlying lawsuit. Wink also sought penalties and damages pursuant to article 21.55 of the Texas Insurance Code (prompt payment statute) and article 21.21 of the Texas Insurance Code (unfair claim settlement practices statute) based on SLIC’s refusal to provide it with a defense.

Both parties filed motions for partial summary judgment in the declaratory judgment action, and the trial court granted Wink’s motion for partial summary judgment and denied SLIC’s motion. Pursuant to section 51.014(f) of the Civil Practice and Remedies Code, we granted SLIC permission to appeal the trial court’s partial summary judgment ruling.

Standard op Review

We review a trial court’s summary judgment ruling de novo. Valores Corporativos, S.A. de C.V. v. McLane Co., 945 S.W.2d 160, 162 (Tex.App.-San Antonio 1997, writ denied). We will uphold a traditional summary judgment only when there are no disputed issues of material fact and the moving party is entitled to judgment as a matter of law. Tex. Commerce Bank, N.A. v. Grizzle, 96 S.W.3d 240, 252 (Tex.2002). In reviewing a traditional motion for summary judgment, we resolve every doubt and indulge every reasonable inference in the nonmovant’s favor. Id. All evidence favorable to the nonmovant will be taken as true. Id. When both parties move for summary judgment and the trial court grants one motion and denies the other, we review the summary judgment evidence of both parties, determine all questions presented, and render the judgment that the trial court should have rendered. See Bradley v. State ex rel. White, 990 S.W.2d 245, 247 (Tex.1999).

Discussion

SLIC raises two complaints on appeal: (1) the pleadings in the underlying class action lawsuit do not trigger SLIC’s duty to defend Wink under the E & 0 provisions of its policy because Wink is accused of committing acts outside the scope of its coverage; and (2) Wink is not entitled to penalties and attorney’s fees under article 21.55 of the Texas Insurance Code because article 21.55 does not apply to claims for a defense under a commercial general liability policy.

Duty to Defend

SLIC contends the trial court erred by granting summary judgment in Wink’s favor because the pleadings in the underlying class action do not trigger its duty to defend Wink under the E & 0 provisions of its policy. Whether an insurer of a liability policy is obligated to defend the insured is a question of law to be decided by the court. TIG Ins. Co. v. San Antonio YMCA 172 S.W.3d 652, 662 (Tex.App.-San Antonio, 2005, no pet. h.); State Farm Gen. Ins. v. White, 955 S.W.2d 474, 475 (Tex.App.-Austin 1997, no pet.). To determine an insurer’s duty to defend, we apply the “eight-corners” rule, comparing the factual allegations in the four corners of the pleadings with the language of the four corners of the insurance policy. National Union Fire Ins. Co. v. Merchants Fast Motor Lines, 939 S.W.2d 139, 141 (Tex.1997).

When we apply the rule, we must focus on the factual allegations that show the origin of the damages rather than on the legal theories alleged, and give a liberal interpretation to the allegations in the petition. Id.; TIG Ins., at 662. We may not, however, read facts into the pleadings, look outside the pleadings, or imagine factual scenarios that might trigger coverage. National Union Fire, 939 S.W.2d at 142. An insurer’s duty to defend arises if the factual allegations against the insured, when fairly and reasonably construed, state a cause of action potentially covered by the policy. Id. at 141. A duty to defend any of the claims against an insured requires the insurer to defend the 'entire suit. Stumph v. Dallas Fire Ins. Co., 34 S.W.3d 722, 728 (Tex.App.-Austin 2000, no pet.). If a petition does not allege facts falling within the scope of coverage, an insurer is not required to defend a suit against its insured. National Union Fire, 939 S.W.2d at 141.

However, if the complaint does not state facts sufficient to clearly bring the case within or without the coverage, the general rule is that the insurer is obligated to defend if there is, potentially, a case under the complaint within the coverage of the policy. Id.; TIG Ins., 2005 WL 1629801, *8. “Stated differently, in case of doubt as to whether or not the allegations of a complaint against the insured state a cause of action within the coverage of a liability policy sufficient to compel the insurer to defend the action, such doubt will be resolved in insured’s favor.” National Union Fire, 939 S.W.2d at 141. (citations omitted). Accordingly, we resolve all doubts regarding the duty to defend in favor of the duty. King v. Dallas Fire Ins., 85 S.W.3d 185, 187 (Tex.2002); TIG Ins., at 662.

The Policy

The policy provisions at issue in this case provide as follows:

COVERAGE A. TRUTH-IN-LEASING AND TRUTH IN LENDING ERRORS AND OMISSIONS

1. Insuring Agreement

a. We will pay sums an “insured” legally must pay as damages arising from negligent errors or omissions which result in civil violation of:

(1) Any federal, state or local Truth-in-Leasing statute; or
(2) Any federal, state or local Truth-in-Lending statute.

B. We have the right and duty to investigate, defend and settle any claim or “suit” for these damages. However, we have no duty to investigate, defend or settle a claim or “suit” not covered by this insurance. Our payment of the Limit of Insurance ends our duty to investigate, defend, or settle.

2. Exclusions

This coverage does not apply to:

a. “Bodily injury,” “property damage,” “personal injury,” or “advertising injury”;

b. Loss, claims, or “suits” arising from:

1. Dishonest, malicious, fraudulent, criminal or intentional acts or omissions; however, this exclusion does not apply to you if such act or omission was communicated by your employee (other than a partner, director, or executive officer), without your direction or your knowledge; or
2. Liability of others assumed by the “insured” under a contract or agreement.

POLICY PERIOD, COVERAGE TERRITORY

This Coverage Form applies only to covered errors and omissions which occur while this endorsement is in effect and applies only in the United States of America, its territories or possessions, Puerto Rico, or Canada.

SLIC first argues it has no duty to defend Wink in the underlying class action lawsuit because plaintiffs’ pleadings do not allege facts showing a violation of a statute within the meaning of the term “Truth-in-Lending statute” as it is used in the policy. Although not defined in the policy, SLIC alleges the term “Truth-in-Lending statute” refers to statutes entitled “Truth-in-Lending,” specifically “the Federal Truth in Lending Act and substitutes thereto.” SLIC thus maintains that it owes no duty to defend Wink because the underlying pleadings fail to demonstrate a cause of action under any statute entitled “Truth-in-Lending.” Wink argues SLIC’s duty to defend it under the policy is triggered whenever Wink is alleged to have violated any statute that has as its purpose the same objectives as the federal Truth-in-Lending Act (“TILA”). Wink thus maintains that because plaintiffs have alleged that it committed numerous violations of the Motor Vehicle Installment Sales Act, a statute that it believes has the same objectives as the federal TILA, it is entitled to a defense under the truth-in-lending provisions of the policy.

We construe insurance policies according to the rules governing contract construction. American Mfrs. Mut. Ins. Co. v. Schaefer, 124 S.W.3d 154, 157 (Tex.2003). Whether a contract is ambiguous is a question of law. Id. If policy language has a certain or definite legal meaning or interpretation, then it is not ambiguous and we construe it as a matter of law. Id. An ambiguity does not arise merely because the parties offer conflicting interpretations of the policy language. Id. Instead, an ambiguity exists only if the contract is susceptible to two or more reasonable interpretations. Id. When policy language is ambiguous or inconsistent, and susceptible to more than one reasonable interpretation, a court resolves the uncertainty by adopting a construction that favors the insured. National Union Fire Ins. Co. v. Hudson Energy Co., 811 S.W.2d 552, 555 (Tex.1991). We thus construe the insurance policy strictly against the insurer and in favor of coverage. Barnett v. Aetna Life Ins., 723 S.W.2d 663, 666 (Tex.1987).

When construing an instrument, ora" primary concern is to give effect to the written expression of the parties’ intent. Forbau v. Aetna Life Ins. Co., 876 S.W.2d 132, 133 (Tex.1994). We will examine and consider the entire writing in an effort to harmonize and give effect to all the provisions of the contract so that none will be rendered meaningless. J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 229 (Tex.2003). “No single provision taken alone will be given controlling effect; rather, all the provisions must be considered -with reference to the whole instrument.” Id.

Here, we believe the policy at issue can be given a definite legal meaning and is not reasonably susceptible to more than one meaning; therefore, we hold the policy is unambiguous as a matter of law. The policy specifies SLIC will provide Wink a defense against claims arising from negligent errors or omissions resulting in civil violation of “[a]ny federal, state or local Truth-in-Lending statute.” We see nothing in the policy’s language that would limit Wink’s coverage to actions based on alleged violations of the federal TILA and its specific state or local counterparts. See Fredericks v. Universal Underwriters Ins. Co., 140 Or.App. 269, 915 P.2d 472, 476 (1996) (holding policy provision promising defense costs for an alleged violation of “ANY FEDERAL, STATE, OR LOCAL * * * TRUTH IN LENDING * * * LAW” was unambiguous and required a defense whenever a cause “allege[d] facts that could be a violation of any law that has as its purpose the same objectives as the federal Truth-in-Lending Act (TILA) and its state and local counterparts”). We therefore hold the policy’s plain language suggests that it contemplates coverage for actions based on a variety of truth-in-lending laws, including the federal TILA, the federal TILA’s specific state and local counterparts, and such other statute that has as its purpose the same objectives and requirements as the federal TILA.

The MotoR Vehicle Installment Sales Act

Turning to the underlying class action petition, we must determine whether facts are alleged that give rise to a duty to defend because the allegations, if true, demonstrate violations of truth-in-lending-laws. The underlying pleadings allege Wink violated various provisions of the Motor Vehicle Installment Sales Act (“MVISA”). See Tex. Fin.Code Ann. §§ 348.001-348.518 (Vernon 1998 & Supp. 2004-2005). According to the pleadings, plaintiffs claim Wink violated the MVISA by, among other things, misrepresenting that it was not charging the plaintiffs interest on the sales tax associated with their purchases; charging the plaintiffs more periodic payments than required to pay off their loans; charging the plaintiffs illegal repossession charges; and charging the plaintiffs bogus payoff charges.

Although the MVISA is not a state substitute for the federal TILA, it appears to serve the same objectives as the federal TILA. Compare 15 U.S.C. § 1601 (indicating the purpose of the federal TILA is “to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit.”) with O.R. Mitchell Motors, Inc. v. Bell, 528 S.W.2d 856, 860 (Tex.App.-San Antonio 1975, writ ref'd n.r.e.) (“In view of the clear legislative intent to protect buyers by preventing abusive and deceptive practices by sellers, and to achieve this objective by regulating the conduct and activities of sellers, there can be no doubt that the legislature intended to achieve its goal by imposing duties on the persons who, in the legislative judgment, had, under the old law, been guilty of abusive and deceptive practices. Thus, there can be no doubt that the purpose of Article 7.02 [one of the predecessor statutes to the MVISA,] was to impose duties on sellers, the persons who, in the ordinary course of business, as did defendant here, present to the buyer a document ready for the buyer’s signature.”).

Moreover, MVISA contains provisions establishing substantive disclosure requirements similar to those of the federal TILA. The federal TILA requires creditors to make certain disclosures, including, among others, these: the identity of the creditor making the disclosures; the amount financed; itemization of amount financed; the finance charge; the annual percentage rate; the number, amounts, and timing of payments scheduled to repay the obligation; the total of payments; and the total sale price. Similarly, the MVI-SA requires a retail installment contract to contain, among other specific disclosures, these: the name of the retail seller; the amount financed; itemization of amount financed; the finance charge; the annual percentage rate; the number, amounts, and timing of payments scheduled to repay the obligation; the total of payments; and the total sale price. Tex. Fin.Code Ann. § 348.009 (Vernon 1998) (incorporating into the MVISA the disclosure requirements of the federal TILA’s implementing regulation (12 C.F.R. Part 226 (Regulation Z))); § 348.102 (providing a list of mandatory disclosures for retail installment contracts).

The fact that the MVISA and the federal TILA/Regulation Z share similar objectives and require many of the same disclosures lead us to believe that the MVTSA’s disclosure provisions are state truth-in-lending laws for purposes of this appeal. Having resolved this issue, we now consider whether the underlying pleadings contain allegations demonstrating that Wink may have violated the MVI-SA’s disclosure provisions.

As noted above, retail sellers in Texas are required to disclose to a consumer a payment schedule, including the number, amounts, and timing of payments scheduled to repay the obligation. Tex. Fin.Code Ann. § 348.009; see also 12 C.F.R. § 226.18. The underlying lawsuit alleges, among other things, that Wink “charg[ed] more periodic payments than required to pay off the loan.” By disclosing a payment schedule that instructed its customers to make more periodic payments than they were obligated to make, Wink arguably made an inaccurate or misleading disclosure to its customers. When a seller discloses the required terms relating to a transaction, it must do so accurately. See Roberts v. Fleet Bank, 342 F.3d 260, 266 (3rd Cir.2003) (holding creditors must accurately disclose the federal TILA’s requirements); Smith v. Chapman, 614 F.2d 968, 977 (5th Cir.1980) (“A misleading disclosure is as much a violation of TILA as a failure to disclose at all.”). Therefore, if Wink did not accurately disclose to its customers the number of payments scheduled to repay the obligation, Wink may have violated the MVISA because an inaccurate or misleading disclosure is as much a violation of the MVISA as a failure to disclose at all. SLIC’s duty to defend under the truth-in-lending provisions of the policy is thus triggered by the allegations in the underlying lawsuit.

The POLICY Period

SLIC next argues that the factual allegations in the underlying petition do not give rise to SLIC’s duty to defend Wink because the underlying pleadings do not allege Wink harmed the plaintiffs during the policy period of September 1997 through September 2000. The underlying petition provides:

4.2 Plaintiffs
Each Plaintiff named in ¶ 4.1 is a buyer of a used car from an independent dealer in Texas after October 1, 1993, in a sale that was financed by the seller and in which the sales tax was deferred, pursuant to Section 152.047 of the Texas Tax Code. Each Plaintiff was forced to pay unfair, unjust, illegal and excessive fees and interest charges in the retail installment purchase in the Defendants’ violations of Chapter 7 of the Texas Credit Code, Rule § 3.74 of the Texas Administration Code, and other applicable statutes and codes. The named Plaintiffs are resident citizens of Texas. The named Plaintiffs sue individually and as Representatives of a Class of all others who are similarly situated.
5.1 After October 1, 1993 Plaintiffs bought used cars from the Defendant Dealers. Those ears were sold pursuant to seller-financed retail installment sales contracts.

Construing the factual allegations of the underlying petition liberally, the petition indicates the plaintiffs’ damages potentially occurred during Wink’s policy period. While the underlying petition does not give specific dates for the disputed sales transactions, it does allege that all of the defendant car dealers, including Wink, sold the plaintiffs their cars between the dates of October of 1998 and September of 2002 (the date of the lawsuit). This time period clearly encompasses Wink’s policy period. “ Where the complaint does not state facts sufficient to clearly bring the case within or without the coverage, the general rule is that the insurer is obligated to defend if there is, potentially, a case under the complaint within the coverage of the policy.’ ” National Union Fire Ins. Co., 939 S.W.2d at 141 (citations omitted). Because the pleadings potentially allege damages from conduct occurring during the policy periods, SLIC owes Wink a defense.

Negligent Errors & Omissions

SLIC also argues that the allegations raised in the underlying suit fall outside the scope of the policy because they do not reveal the plaintiffs’ damages arose from Wink’s negligent errors or omissions. The petition from the underlying suit provides:

FACTUAL BASIS FOR THE PLAINTIFFS’ CLAIMS
5.2The Texas Tax Code, effective October 1, 1993, permitted automobile dealers, who used seller-financed retail installment sales contracts, to defer the payment of sales tax to the State Comptroller until it was collected from the car buyer. See Tex. Tax Code § 152.407. After this statute went into effect, automobile dealers who collect and pay sales tax pursuant to Rule § 3.74 of the Texas Administration Code were permitted to include the sales tax as part of the Amount Financed. The sales tax was to be collected and no interest charged as a portion of each periodic installment payment over the life of the contract, and then reported and paid to the State Comptroller quarterly or periodically, as collected.
5.3 Defendant Dealers took advantage of this deferred sales tax structure to contract for, charge, or collect interest or fees from the Plaintiffs in an amount that was unfair, unjust and in excess of that allowed by law.
Additional Illegal Practices
5.4 Among other illegal Seller-Financed Sales practices used by the Defendants to overcharge car buyers include: (1) use of excessive finance charges, (2) charging more periodic payments than required to pay off the loan, (3) illegal repossession charges, (4) improper late fees, (5) bogus payoff charges, (6) non-approved warranty policies, and (7) non-payment of the buyer’s sales tax to the state all in violation of the provisions of Chapter 7 of the Texas Credit Code, Rule § 3.74 of the Texas Administration Code, and other applicable statutes and codes. The amounts collected were unfair, unjust and in excess of that allowed by law.

Wink does not dispute that the factual allegations found within paragraph 5.3 of the underlying petition fail to trigger SLIC’s duty to defend because the allegations in this paragraph concern intentional conduct, which falls outside the scope of its policy with SLIC. Wink does dispute, however, SLIC’s contention that the allegations found within paragraph 5.4 do not give rise to SLIC’s duty to defend. Paragraph 5.4 of the underlying petition refers to acts committed by Wink without reference to Wink’s intent. As a result, it is unclear whether paragraph 5.4 concerns negligent or intentional conduct. Once again, where the complaint does not state facts sufficient to clearly bring the case within or without the coverage, the insurer is obligated to defend if there is potentially a case under the complaint within the policy coverage. See National Union Fire Ins. Co., 939 S.W.2d at 141. Because the factual allegations contained within paragraph 5.4 indicate the plaintiffs may have a complaint within the coverage of the policy, we cannot say the underlying suit falls outside the scope of the policy. See id.

SLIC also argues the plaintiffs’ underly- . ing petition does not include any allegations that fall within the scope of the terms “error” and “omission” as those terms are used in the policy. These terms, however, are not defined in the policy. We therefore give these terms their ordinary and generally accepted meaning. Sec. Mut. Cas. Co. v. Johnson, 584 S.W.2d 708, 704 (Tex.1979) (recognizing we must give insurance policy language its ordinary and generally accepted meaning unless the policy shows that the words used are intended to impart a technical or different meaning.). An error is “an act or condition of ignorant or imprudent deviation from a code of behavior; an act involving an unintentional deviation from truth or accuracy; an act that through ignorance, deficiency, or accident departs from or fails to achieve what should be done.” WebsteR’s Ninth New Collegiate Dictionaey 423 (9th ed.1991). The term omission is defined as “something neglected or left undone; apathy toward or neglect of duty; the act of omitting; the state of being omitted.” Id. at 823.

In paragraph 5.4 of the plaintiffs’ petition, it is alleged that Wink used excessive finance charges; charged more periodic payments than required to pay off the loan; charged illegal repossession charges; charged improper late fees; charged bogus payoff charges; used non-approved warranty policies; and failed to pay the buyer’s sales tax to the state. It is unclear from the petition whether plaintiffs are accusing Wink of intentionally committing these acts. Because the aforementioned allegations may very well be the result of Wink’s carelessness or neglect, we hold the plaintiffs’ petition includes allegations that may fall within the scope of the terms “errors” or “omissions” as those terms are used in the policy. See National Union Fire Ins. Co., 939 S.W.2d at 141.

Lastly, SLIC claims the policy’s intentional injury exclusion precludes coverage. As previously discussed, it is unclear whether the allegations raised in paragraph 5.4 of the plaintiffs’ petition concern negligent or intentional conduct. Consequently, we hold the policy’s intentional injury exclusion does not preclude coverage because the pleadings potentially allege damages arising from negligent conduct committed during the policy periods.

ARTICLE 21.55 OF THE TEXAS InsuRance Code

Lastly, SLIC complains the trial court erred by concluding Wink has a valid cause of action under article 21.55 of the Texas Insurance Code. SLIC argues that article 21.55 does not apply to a duty to defend. We agree.

Article 21.55 “ ‘establishes procedures for the prompt payment of insurance claims, including the acknowledgment of an insured’s notice of a claim.’ ” Northern County Mut. Ins. Co. v. Davalos, 140 S.W.3d 685, 690 (Tex.2004). The article generally requires insurers to either accept or reject a claim within a prescribed period or explain why it needs more time to investigate. Id.; Tex.Rev.Civ. Stat. Ann. art. 21.55 § 3 (Vernon Supp.2004-2005). Article 21.55 further provides for the award of penalties and attorney’s fees for its violation. The article defines a “claim” as “a first party claim made by an insured or a policyholder under an insurance policy or contract or by a beneficiary named in the policy or contract that must be paid by the insurer directly to the insured or beneficiary.” Id. § 1(3).

SLIC submits that article 21.55 applies only to first-party claims based on the Fifth Court of Appeals’s holding in TIG Ins. Co. v. Dallas Basketball, Ltd., 129 S.W.3d 232 (Tex.App.-Dallas 2004, pet. denied). In Dallas Basketball, Ltd., the court concluded that a request for a defense is not a first-party claim for money to be paid directly to the insured; therefore, article 21.55 does not apply to claims for a defense. 129 S.W.3d at 239. The court stated, “[t]he entire structure of article 21.55 presumes a tangible, measurable loss suffered by the insured for which he seeks payment from the insurance company. Any attempt to apply the statute’s structure to a claim for a defense is unworkable and, based on the language of the statute, clearly unintended by the legislature.” Id.

The court explained:

First, we note that article 21.55 is entitled “Prompt Payment of Claims.” A demand for a defense under a liability policy is not a claim for payment. It is a demand that the insurance company provide a legal defense to the insured as required by the policy. The insurance company is not required to send a payment to the insured, prompt or otherwise, in response to a claim for a defense.
Next, article 21.55’s definition of the term “claim” requires that the claim be a “first party claim ... that must be paid by the insurer directly to the insured or beneficiary.” When an insurance company provides its insured with a defense, the company then controls the defense and pays the attorneys’ fees associated with the case to the attorney engaged to represent the insured. The insured does not receive any direct payment as required by article 21.55.

Id. (citations omitted).

Next, the court considered the insured’s argument that, due to the insurer’s “refusal to provide them with a defense, they have been forced to pay for their own legal representation and their claim for reimbursement of the defense costs is a first-party claim to be paid directly to them.” Id. at 240. The court rejected this argument because it determined a claim for reimbursement is not a claim under the policies, but rather a common law claim for breach of contract damages. Id.

The court’s analysis further provided:

Our conclusion that a claim for a defense is not a “claim” to which article 21.55 was intended to apply is further supported by the fact that both the statute’s deadlines and its consequences for failing to meet those deadlines presume that the insured’s claim is one for compensation for a covered loss rather than for a defense. Under section 3 of article 21.55, the time period within which the insurance company must accept or reject a claim begins to run from the date the company receives all information necessary to secure proof of the insured’s loss. At the time the insured makes his claim for a defense, however, he has not necessarily incurred any legal expenses or suffered any actual loss. He has merely been sued. To equate being made the subject of a lawsuit with suffering a compensable loss would contort the statute’s plain and common meaning. Because the deadline to accept or reject a claim begins to run when the insurer receives proof of the insured’s loss, the deadline has no meaning when applied to a claim for a defense.
The penalty imposed on insurers who fail to meet the statutory deadlines also has no meaning when applied to claims for a defense. Under section 6 of article 21.55, insurers that do not meet the requirements of article 21.55 are liable to pay the insured “in addition to the amount of the claim, 18 percent per annum of the amount of such claim as damages....” A claim for a defense has no “amount” to which the section 6 penalty may be applied because the claim is not for payment of money but for services to be rendered. As discussed above, to the extent the insured pays for his own defense and seeks to be reimbursed for these payments, his claim for reimbursement is not a claim under the policy but rather a common law claim for damages. Even if such reimbursement claims could be used for purposes of calculating the penalty owed, in many cases an insured may be unable to afford to hire and pay his own defense counsel. In such cases, the monetary value of the defense claim would be mere speculation. The insureds who are incapable of paying their own attorney’s fees when they are sued would be the only ones unable to impose the penalty when the company wrongfully refuses to defend them. Such a result is irrational.

Id. (citations omitted).

Wink responds that Dallas Basketball, Ltd. stands alone in holding that article 21.55 does not apply to claims for a defense under a commercial general liability policy. Wink claims the Fifth Court’s holding in Dallas Basketball, Ltd. is contrary to the holdings of other Texas state and federal courts, which have applied article 21.55 to claims for a defense. See ATOFINA Petrochemicals, Inc. v. Evanston Ins. Co., 104 S.W.3d 247, 252 (Tex.App.-Beaumont 2003, pet. granted); Northern County Mut. Ins. Co. v. Davalos, 84 S.W.3d 314, 318-19 (Tex.App.-Corpus Christi 2002), rev’d on other grounds, 140 S.W.3d 685 (Tex.2004); Luxury Living, Inc. v. Mid-Continent Cas. Co., No. Civ. A. H-02-3166, 2003 WL 22116202, *20 (S.D.Tex. Sept.10, 2003); Primrose Operating Co. v. National Am. Ins. Co., No. Civ. A. 5:02-CV-101-C, 2003 WL 21662829, *3 (N.D.Tex. July 15, 2003), aff'd in part and rev’d in part on other grounds, 382 F.3d 546 (5th Circ.2004); Westport Ins. Corp. v. Atchley, Russell, Waldrop & Hlavinka, L.L.P., 267 F.Supp.2d 601, 632 n. 19 (E.D.Tex.2003); Ryland Group, Inc. v. Travelers Indem. Co., No. Civ. A-00-CA-233 JRN, 2000 WL 33544086, at *11-12 (W.D.Tex.2000). Wink submits that, based on these authorities, the defense owed to it by SLIC is a first-party claim under article 21.55.

We agree with the rationale enunciated by our sister court in Dallas Basketball, Ltd.; therefore, like the Fifth Court of Appeals, we hold that article 21.55 does not apply to claims for a defense. We believe that an insured’s claim for defense costs is not a “first party claim” as that term is used in article 21.55. Luxury Living, 2008 WL 22116202, at *20; Ryland Group, 2000 WL 33544086, at *11-12.

Conclusion

Based on the foregoing, we affirm the trial court’s judgment to the extent it concludes SLIC owes Wink a defense in the underlying class action lawsuit. However, we reverse the trial court’s judgment to the extent it concludes Wink has a valid claim for penalties and attorney’s fees based upon SLIC’s alleged violation of article 21.55 of the Texas Insurance Code. Accordingly, we render judgment that Wink take-nothing on its article 21.55 claim.

Concurring and dissenting opinion by CATHERINE STONE, Justice.

CATHERINE STONE, Justice,

concurring and dissenting.

I concur in the opinion of the court affirming the trial court’s judgment regarding SLIC’s duty to defend J.C. Wink in the underlying class action lawsuit. I respectfully dissent, however, from the court’s opinion reversing and rendering judgment that J.C. Wink take nothing from SLIC on its article 21.55 claim.

The majority holds that article 21.55 of the Texas Insurance Code applies only to first-party claims based on the Fifth Court of Appeals’s holding in TIG Insurance Co. v. Dallas Basketball, Ltd., 129 S.W.3d 232 (Tex.App.-Dallas 2004, pet. denied). (Slip op. at 19). The Fifth Court’s holding in Dallas Basketball, Ltd., however, is one of the only cases to hold that article 21.55 does not apply to claims for a defense. The majority of courts that have addressed the issue have held article 21.55 applies to claims for a defense. See ATOFINA Petrochemicals, Inc. v. Evanston Ins. Co., 104 S.W.3d 247, 252 (Tex.App.-Beaumont 2003, pet. granted); Northern County Mut. Ins. Co. v. Davalos, 84 S.W.3d 314, 318-19 (Tex.App.-Corpus Christi 2002), rev’d on other grounds, 140 S.W.3d 685 (Tex.2004); Luxury Living, Inc. v. Mid-Continent Cas. Co., No. Civ. A. H-02-3166, 2003 WL 22116202, *20 (S.D.Tex. Sept.10, 2003); Primrose Operating Co. v. Nat’l American Ins. Co., No. Civ. A. 5:02-CV-101-C, 2003 WL 21662829, *3 (N.D.Tex. July 15, 2003), ajfd in part and rev’d in part on other grounds, 382 F.3d 546 (5th Circ.2004); Westport Ins. Corp. v. Atchley, Russell, Waldrop & Hlavinka, L.L.P., 267 F.Supp.2d 601, 632 n. 19 (E.D.Tex.2003); Ryland Group, Inc. v. Travelers Indem. Co., No. Civ. A-00-CA-233 JRN, 2000 WL 33544086, at *11-12 (W.D.Tex.2000); see also State Farm Fire & Cas. Co. v. Gandy, 925 S.W.2d 696, 714 (Tex.1996) (suggesting that article 21.55 may apply to claims for defense). Because I agree with the reasoning of these courts, I believe J.C. Wink has a valid claim for penalties and attorney’s fees under article 21.55.

      . This proceeding arises out of Cause No.2002-CI-05453, styled Ramos et al. v. Al’s Auto Sales, et al., pending in the 288th Judicial District Court of Bexar County, Texas, the Honorable Lori Massey presiding.

      . Wink’s motion for partial summary judgment did not address its claims under article 21.21. Those claims remain pending before the trial court.

      . Section 226.29 of the Code of Federal Regulations provides that any state may apply to the Board of Governors of the Federal Reserve System to exempt a class of transactions within the state from the requirements of the federal TILA and its implementing regulation (Regulation Z) if the state has a law substantially similar to the federal law and has an adequate provision for enforcement. 12 C.F.R. § 226.29. If an exemption is granted, the disclosures required by the applicable state law (except any additional requirements not imposed by federal law) shall constitute the disclosures required by the federal act. Id. The parties have not cited, nor can we find, any authority demonstrating that Texas has obtained an exemption from the Board regarding the MVISA.

      . This list of disclosures from the federal TILA is a non-exhaustive list. See 15 U.S.C. § 1638(a); 12 C.F.R. § 226.18.

      . Our holding is limited to those provisions of the statute that specifically relate to disclosure. We do not decide whether any other provisions within the MVISA may be considered state truth-in-lending laws.

      . See generally St. Paul Ins. Co. v. Tex. Dept, of Transp., 999 S.W.2d 881, 887 (Tex.App.-Austin 1999, pet. denied) (noting once coverage is found for any portion of a suit, an insurer must defend the entire suit). The underlying lawsuit further alleges that Wink made misrepresentations that it was not charging the plaintiffs interest on the amount of the sales tax associated with their purchases. The underlying suit also alleges Wink disclosed to the plaintiffs that they were obligated to pay certain fictitious payoff charges. Although the MVISA may not have required Wink to include information concerning the interest on the sales tax or applicable payoff fees in its retail installment contracts, see Tex. Fin.Code Ann. §§ 348.009, 348.102, we cannot say that a misrepresentation or inaccuracy regarding these non-mandatory disclosures could not also be a violation of the MVISA. Whenever a retail seller includes additional information in its retail installment contract pursuant to the provisions of the MVISA, see id. § 348.010 ("Information not required by this chapter may be included in a retail installment contract.”), we believe the seller is obligated to make such disclosures accurately and truthfully. See Fleet Bank, 342 F.3d at 266; Chapman, 614 F.2d at 977. Thus, these allegations could also trigger SLIC's duty to defend Wink in the underlying suit.

      . The policy provides: “This coverage does not apply to ... Loss, claims, or 'suits’ arising from ... intentional acts or omissions.... ”

      . Id. § 6. When an insurance company does not comply with the requirements of the statute, the company is liable to pay “in addition to the amount of the claim, 18 percent per annum of the amount of the claim as damages, together with reasonable attorneys fees.’’ Id.

      . See 129 S.W.2d at 239. We note that the Texas Supreme Court has suggested that article 21.55 may apply to claims for defense. See State Farm Fire and Casualty Co. v. Gandy, 925 S.W.2d 696, 714 (Tex.1996). In Gandy, the court commented:
      For example, when issues of coverage and the duty to defend arise, it is not unusual for I or D or both to attempt to adjudicate them before P’s claim is adjudicated. Disputes between I and D can often be expeditiously resolved in an action for declaratory judgment while P’s claim is pending. If successful, D should be entitled to recover attorney fees. Tex Civ. Prac. & Rem.Code Ann. § 37.009; Tex Ins.Code Ann. art. 21.55, § 6. D may also be entitled to recover a penalty against I equal to eighteen percent of the claim. Tex Ins.Code art. 21.55, § 6.

        Id. The court further stated:
      We believe this balancing of interests minimizes any hardship on an insured defendant. Determining an insurer's obligations before its insured incurs liability benefits both the insurer and the insured by removing that uncertainty. An insurer has ample disincentives to deny coverage or a defense without good reason: it will be liable for its own attorney fees in litigating the dispute and may be liable for the insured's attorney fees, a statutory penalty, and even bad faith damages.

        Id. However, these statements are dicta and made without any accompanying analysis.