UPLC v. Nationwide Mutual Ins. Co., No. 05-0130. 264 S.W.3d 742 (Tex. Sep. 26, 2008)(per curiam
opinion denying motion for rehearing)(legality of insurance company's use of staff attorneys to defend insured,
UNAUTHORIZED PRACTICE OF LAW COMMITTEE v. NATIONWIDE MUTUAL INSURANCE COMPANY AND SEAN
P. MARTINEZ; from Bexar County; 4th district (04-04-00184-CV, 155 SW3d 590, 12-08-04)
Per Curiam Opinion
Opinion below: UPLC v. Nationwide Mutual Insurance Company, No. 04-04-00184-CV (Tex.App.- San Antonio,
Dec. 8, 2004, pet. denied)(we hold that Nationwide Mutual Insurance Company and Sean Martinez do not engage
in the unauthorized practice of law through the use of staff counsel to represent the insureds of Nationwide and its
wholly-owned and controlled companies.
Unauthorized Practice of Law Committee v. National Mutual Ins. Co.,
264 S.W.3d 742 (Tex. 2008)(per curiam)
Nationwide Mutual Insurance Co. and its managing trial attorney, Sean P. Martinez, sued the
Unauthorized Practice of Law Committee for a “declaration that the employment of duly licensed staff
legal counsel by Nationwide to represent the interest of its insureds, where the insurance company has a
contractual obligation to defend and indemnify the insured, does not constitute the unauthorized practice
of law under any Texas law,” and for other relief. The trial court granted summary judgment for the
plaintiffs, specifically granting the declaration sought, and the court of appeals affirmed. 155 S.W.3d 590,
599 (Tex. App.–San Antonio 2004).
In Unauthorized Practice of Law Committee v. American Home Assurance Co., ___ S.W.3d ___, ___,
51 Tex. Sup. Ct. J. 590, 590 (Mar. 28, 2008), we held that an insurer may use staff attorneys to defend a
claim against an insured if the insurer’s interest and the insured’s interest are congruent, but not
otherwise. Their interests are congruent when they are aligned in defeating the claim and there is no
conflict of interest between the insurer and the insured.
Based on our decision in that case, we denied the Committee’s petition for review in the present case.
51 Tex. Sup. Ct. J. 562 (Mar. 28, 2008).
The Committee argues in its motion for rehearing that the present case raises an issue not involved in
American Home, namely, whether an insurer engages in the unauthorized practice of law by employing
staff attorneys to represent its affiliates’ insureds. The Committee has argued on appeal in this case that
even if an insurer may employ staff counsel to represent its own insureds, it cannot represent its affiliates’
insureds. The court of appeals rejected the argument on the grounds that there was no evidence that
Nationwide provided legal services to insureds of “any entity other than the Nationwide group of wholly
owned and controlled companies.” But because the trial court did not address the issue in its judgment, it
cannot be considered on appeal. Tex. R. App. P. 25.1(c).
Accordingly, the Committee’s motion for rehearing is denied.
Opinion issued: September 26, 2008