The shopping mall owner, Bender Square Partners, sought to recover from the insurer for losses resulting from Hurricane Ike to property it had leased to PNS Stores, Inc. Bender Square Partners v. Factory Mut. Ins. Co., 2012 U.S. Dist. LEXIS 8095 (S.D. Texas Jan. 24, 2012). It turned out Bender was not an additional insured under the lessee's policy with Factory Mutual.
The lease required the lessee to maintain property insurance. The policy that was acquired from Factory Mutual did not identify Bender as an insured or as an additional insured. The policy stated that additional insured interests were added to the policy when named as an additional named insured in a Certificate of Insurance in a schedule on file with the insurer.
Bender argued it was a named holder of the Certificate of Insurance and was also an intended or implied third-party beneficiary of the policy.
The Certificate of Insurance specifically stated it was issued for informational purposes only and conferred no rights upon the holder other than those provided in the policy. Under Texas law, the Certificate did not confer any rights to Bender under the policy.
Further, there was no evidence to support an inference that Bender was an intended third-party beneficiary. Nor was Bender an implied third-party beneficiary. There was no provision in the lease requiring the lessee to procure a policy on the lessor's behalf, or requiring the policy to name the lessor as an insured, additional insured, or loss payee. Therefore, Bender could not be an implied third-party beneficiary.
Consequently, because it was not an insured, additional insured, or third-party beneficiary under the Policy, Bender could not sue Factory Mutual for breach of contract or for the breach of the duty of good faith and fair dealing. Factory Mutual was entitled to summary judgment as to all of Bender's claims against it.
