Cole v. Hall

864 S.W.2d 563, 1993 Tex. App. LEXIS 3140, 1993 WL 289181

• Court: Court of Appeals of Texas
• Decided: July 27, 1993
• Docket: 05-92-01098-CV
• Status: Published

Opinions

OPINION

LAGARDE, Justice.

Pepper Cole appeals the trial court's dismissal of her suit against the Halls and Dickey’s Hardware for failure to state a cause of action. Appellant brings two points of error contending that the trial court erred in dismissing her claims because her allegations of tortious interference with statutory rights and appellees’ breach of the duty of good faith and fair dealing stated viable causes of action. We overrule the points and affirm the trial court’s judgment.

FACTUAL & PROCEDURAL BACKGROUND

Appellant alleged that on December 23, 1988, she sustained an injury in the course and scope of her employment. She filed a workers’ compensation claim. While off work due to the injury, appellees understated to the workers’ compensation carrier the amount of appellant’s salary by $148.50 per week. This understatement of her wage rate resulted in appellant receiving $112.85 per week less than she would have received if appellees had reported the correct amount of her wages. Appellant asserted that appel-lees’ understatement of her wage rate tor-tiously interfered with her statutory rights accorded her under the Texas Workers’ Compensation Act and was a breach of appel-lees’ duty of good faith and fair dealing towards her, resulting in her suffering damages of $85,000. Appellant asserts that her damages consist of economic hardship, lost wages, reduced compensation benefits, mental anguish, and emotional trauma.

Appellees filed three special exceptions to appellant’s first amended original petition, as supplemented by appellant’s supplemental petition, challenging both of appellant’s causes of action. Each of the three special exceptions asserts in identical language the following defects in the petition: (1) by accepting workers’ compensation benefits, appellant waived any statutory or common-law cause of action for personal injury or death sustained in the course and scope of her employment with appellees; (2) by seeking benefits under the workers’ compensation statute, appellant is precluded from bringing suit against appellees for alleged intentional injury; (3) appellant elected her remedy by accepting workers’ compensation benefits; and (4) Texas does not recognize a duty of good faith and fair dealing between employer and employee.¹ The trial court sustained appellees’ special exceptions and gave appellant three days to amend her pleadings. The trial court specifically stated that the failure to amend would result in the cause being dismissed with prejudice. When appellant failed to amend her pleadings, the trial court dismissed her causes of action.

APPELLATE REVIEW OF SUSTAINING OF SPECIAL EXCEPTIONS

Review of a trial court’s dismissal of a cause of action following the sustaining of special exceptions and the plaintiffs failure to amend requires an examination of two distinct rulings by the trial court. We first review the propriety of the trial court’s decision to sustain the special exceptions. If the trial court’s decision to sustain the special exceptions was proper, we then review the propriety of the trial court’s decision to dismiss the cause of action. See McCamey v. Kinnear, 484 S.W.2d 150, 152 (Tex.Civ.App.—Beaumont 1972, writ ref'd n.r.e.).

An appellant complaining of the dismissal of a cause of action following the sustaining of special exceptions must attack the trial court’s decision to sustain the special exceptions. The appellant should then attack the trial court’s decision to dismiss. Cf. Sanchez v. Huntsville Indep. Sch. Dist., 844 S.W.2d 286, 288 (Tex.App.—Houston [1st Dist.] 1992, no writ);² Villareal v. Martinez, 834 S.W.2d 450, 452 (Tex.App.—Corpus Christi 1992, no writ).³ If the trial court properly sustained the special exceptions and the plaintiff refuses or fails to amend, the trial court does not err in dismissing the cause of action. See Davis v. Quality Pest Control, 641 S.W.2d 324, 328, 330 (Tex.App.—Houston [14th Dist.] 1982, writ ref'd n.r.e.); Townsend v. Memorial Medical Ctr., 529 S.W.2d 264, 267 (Tex.Civ.App.—Corpus Christi 1975, writ ref'd n.r.e.). If the remainder of the pleading does not state a cause of action, the trial court does not err in dismissing the entire case. Jackson v. City of Galveston, 837 S.W.2d 868, 869 (Tex.App.—Houston [14th Dist.] 1992, writ granted); Hubler v. City of Corpus Christi, 564 S.W.2d 816, 820 (Tex.Civ.App.—Corpus Christi 1978, writ ref'd n.r.e.).

The controlling issue in a case where the trial court sustained special exceptions and dismissed the cause of action following the appellant’s failure to amend is the propriety of the trial court’s ruling sustaining the special exceptions. McCamey, 484 S.W.2d at 152. If the appellant does not challenge this ruling on appeal, then any error in the sustaining of the special exceptions is waived.⁴

When the appellant does properly attack the trial court’s sustaining of the special exceptions and dismissal of the cause of action, we review the pleading to determine whether the trial court abused its discretion in sustaining the special exceptions. Bader v. Cox, 701 S.W.2d 677, 686 (Tex.App.—Dallas 1985, writ ref'd n.r.e.). We construe the petition liberally accepting as true all of the factual allegations set forth. Aranda v. Insurance Co. of N. Am., 748 S.W.2d 210, 213 (Tex.1988); Bader, 701 S.W.2d at 686. The trial court’s ruling will not be disturbed absent a showing of abuse of discretion. Bader, 701 S.W.2d at 686.

The test for abuse of discretion is whether the' court acted without reference to any guiding rules and principles, whether the act was arbitrary and unreasonable. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex.1986). The trial court does not necessarily abuse its discretion if under the same facts an appellate judge would decide the matter differently or if the court commits a mere error in judgment. Loftin v. Martin, 776 S.W.2d 146, 146 (Tex.1989).

TORTIOUS INTERFERENCE WITH STATUTORY RIGHTS

In her first point of error, appellant contends that the trial court erred in dismissing her cause of action for tortious interference with statutory rights because her petition stated a cause of action. Appellant does not challenge the propriety of the trial court’s ruling on appellees’ special exceptions.⁵

In the argument under her first point, appellant discusses only the elements of tor-tious interference and why her pleading contained each element.⁶ Nowhere does appellant discuss the merits of the special exceptions, which we construe to be assertions that appellant’s cause of action for tortious interference is barred by application of the exclusive remedy provision of article 8306, section 3. See Tex.Rev.Civ.Stat.Ann. art. 8306, § 3 (Act of May, 5, 1983, 68th Leg., R.S., eh. 131, § 1,1983 Tex.Gen.Laws 613, repealed by The Texas Workers’ Compensation Act, 71st Leg., 2d C.S., ch. 1, § 16.01(7), 1989 Tex.Gen. Laws 1,114). Indeed, appellant’s brief never mentions the exclusivity provision of the statute.

When the trial court dismisses a cause of action following the sustaining of special exceptions and the appellant’s failure to re-plead, the controlling issue is whether the trial court erred in sustaining appellees’ special exceptions. McCamey, 484 S.W.2d at 152. By not attacking on appeal the propriety of the trial court’s ruling, appellant has waived any error by the trial court in sustaining the special exceptions. See Vawter v. Garvey, 786 S.W.2d 263, 264 (Tex.1990) (per curiam). Accordingly, we do not reach the merits of the special exceptions.

When a trial court properly sustains special exceptions and the plaintiff refuses to amend, the trial court does not err in dismissing the cause of action. See Davis, 641 S.W.2d at 328, 330; Townsend, 629 S.W.2d at 267. Because appellant waived any error of the trial court in sustaining the special exceptions, we hold that the trial court did not abuse its discretion in dismissing appellant’s claim of tortious interference with statutory rights. We overrule appellant’s first point of error.

DUTY OF GOOD FAITH AND FAIR DEALING

In her second point of error, appellant contends that the trial court erred in dismissing her cause of action against appellees for breach of the duty of good faith and fair dealing. Appellant’s complaint attacks the ground of the special exception applicable to this cause of action, which was that Texas does not recognize a duty of good faith and fair dealing on the employer to the employee. Because appellant’s argument on appeal attacks the propriety of the trial court’s sustaining the special exception, we must determine whether the trial court erred in sustaining the special exception.

A claim for breach of duty of good faith and fair dealing is a tort action that arises from an underlying contract. Whether a duty exists between the parties is initially a question of law. H.W. Mitchell v. Missouri-Kansas-Texas R.R., 786 S.W.2d 659, 661 (Tex.1990). Texas law does not recognize an implied duty of good faith and fair dealing in every contract or business transaction. See English v. Fischer, 660 S.W.2d 521, 522 (Tex.1983). Texas courts have carved out exceptions for certain “special relationships,” such as those between insurers and insureds, principal and agent, joint venturers, and partners. Arnold v. National County Mut. Fire Ins. Co., 725 S.W.2d 165, 167 (Tex.1987), modified on other grounds by Murray v. San Jacinto Agency, Inc., 800 S.W.2d 826 (Tex.1991); Victoria Bank & Trust Co. v. Brady, 779 S.W.2d 893, 902 (Tex.App.—Corpus Christi 1989), rev’d on other grounds, 811 S.W.2d 931 (Tex.1991). “Absent an Arnold ‘special relationship,’ the duty to act in good faith is contractual in nature and its breach does not amount to an independent tort.” Central Sav. & Loan Ass’n v. Stemmons N.W. Bank, N.A., 848 S.W.2d 232, 239 (Tex.App.—Dallas 1992, no writ); Adolph Coors Co. v. Rodriguez, 780 S.W.2d 477, 481 (Tex.App.—Corpus Christi 1989, writ denied).

Thus far, Texas courts have held that the “special relationship” necessary to create a common-law duty to act in good faith does not apply to the relationship of: (1) supplier-distributor, Adolph Coors Co., 780 S.W.2d at 481; (2) mortgagor-mortgagee, Lovell v. Western National Life Insurance Co., 754 S.W.2d 298, 303 (Tex.App.—Amarillo 1988, writ denied); (3) creditor-guarantor, Federal Deposit Insurance Corp. v. Coleman, 795 S.W.2d 706, 709 (Tex.1990); (4) lender-borrower, Nance v. Resolution Trust Corp., 803 S.W.2d 323, 333 (Tex.App.—San Antonio 1990), writ denied per curiam, 813 S.W.2d 154 (Tex.1991); (5) franchisor-franchisee, Crim Truck & Tractor v. Navistar International Transportation Corp., 823 S.W.2d 591, 596 (Tex.1992); and (6) issuer-beneficiary of letter of credit, Central Sav. & Loan, 848 S.W.2d at 239. Texas courts have consistently rejected finding a duty of good faith and fair dealing owed by the employer to the employee. See, e.g., Guzman v. El Paso Natural Gas Co., 756 F.Supp. 994, 1001 (W.D.Tex.1990); Casas v. Wornick Co., 818 S.W.2d 466, 469 (Tex.App.—Corpus Christi 1991, writ denied); Cockrell v. Republic Mortgage Ins. Co., 817 S.W.2d 106, 116 (Tex.App.—Dallas 1991, no writ).

The supreme court granted special relationship status to an insured dealing with its insurer in order to rectify the inherent inequality of bargaining power existing between an insured and the insurer. In Arnold, the insured presented a proper claim to its insurer only to have it rejected without a reasonable investigation of the facts, leaving the insured with no recourse but to bring suit. See Arnold, 725 S.W.2d at 166-67. In Aranda, the insurers recognized that the insured had a compensable claim, but they could not agree on which of them was primarily liable; accordingly, both insurers refused to pay. The insured then had no choice but to bring suit and face the delay and expense caused thereby. Aranda, 748 S.W.2d at 211, 215.

Appellant argues that the Workers’ Compensation Act creates an Aranda “special relationship” between the employer and employee. Appellant asserts that this relationship arises out of the employer’s duty to report the correct wages to the insurance carrier and the Texas Workers’ Compensation Commission. She maintains that “there is no other remedy or scheme under which an employee could seek redress for injuries sustained as a result of her employer’s conduct.” For this reason, she asserts, we should find a special relationship between an employer and employee in cases involving an employer’s duties under the Workers’ Compensation Act.

We disagree. The facts in this case are not so extreme as to warrant creation of a duty of good faith and fair dealing between an employer and its employee. Unlike the insureds in Arnold, and Aranda, who were forced to bring suit in order to recover their insurance benefits, appellant could have petitioned the Industrial Accident Board under article 8306, section 12d to review its award due to a change in condition, mistake, or fraud.⁷ At oral argument, appellant stated that there arguably could be an administrative proceeding against the insurer to adjust the compensation rate. Given the existence of alternate remedies in this case, we see no need to place a duty of good faith and fair dealing on an employer to its employees. Accordingly, we hold that the trial court did not abuse its discretion in sustaining the special exceptions and dismissing appellant’s cause of action for breach of the duty of good faith and fair dealing. We overrale appellant’s second point of error.

We affirm the trial court’s judgment.

BAKER, THOMAS, KINKEADE, OVARD, BURNETT, MALONEY, MORRIS, and WHITTINGTON, JJ., join in the majority opinion. ROSENBERG, J., dissents with opinion. McGARRY, C.J., and CHAPMAN and BARBER, JJ., join in the dissenting opinion.

1 . Appellees’ special exceptions read:

Defendants specifically except to Paragraph[s] [VI, VII, and VIII] of Plaintiff’s First Amended Original Petition wherein it is alleged:

[quoting appellant’s petition alleging tortious interference with statutory rights and breach of duty of good faith and fair dealing]

for the reason that the Plaintiff’s petition alleges on its face (in Paragraphs II, III, and IV) that Plaintiff’s alleged cause of action against Defendant’s [sic] arose out of a work-related injury, that Plaintiff filed and received worker’s [sic] compensation in Board No. 89-03748-D2, and that Defendants were Plaintiff's employers at the time of the alleged commission of the acts made the basis of Plaintiff’s alleged causes of action. The complained of language in Plaintiff’s Original Petition attempts to assert against Defendants, as her employers, causes of action for tortiously interfering with her statutory rights under the Texas Workers' Compensation Act (Article 8306-8309 Revised Civil Statutes of Texas) and for Defendant’s [sic] alleged breach of an alleged duty of good faith and fair dealing to Plaintiff as her employers. By accepting Workers’ Compensation benefits, Plaintiff, pursuant to the provisions of Article 8308-3.08 Revised Civil Statutes of Texas, waived any right of action at common law or under any statute of the State of Texas for damages for personal injuries or death sustained in the course and scope of her employment with Defendants. By seeking benefits under the Texas Workers' Compensation Act, Plaintiff is precluded from maintaining a suit against her employer for alleged intentional injury. Plaintiff elected her remedy when she elected to proceed under the Texas Workers’ Compensation Act and such remedy was compromised and settled in Board No. 89-037348-D2. Further, the State of Texas does not recognize a duty of good faith and fair dealing between employer and employee. Plaintiff’s First Amended Original Petition fails, therefore, to allege facts sufficient to show or constitute a cause of action against Defendants.

2 . In Sanchez, the appellant raised separate and distinct points attacking both the propriety of the trial court's ruling on the special exceptions as well as its dismissal of the cause of action. The court in Sanchez first determined the propriety of the trial court's ruling on the special exceptions. Having found that the trial court correctly ruled on the special exceptions, it went on to hold that the trial court did not abuse its discretion in dismissing the cause of action.

3 . The appellant brought points of error contending that the trial court erred in granting the special exceptions. The court of appeals first determined that the trial court erred in sustaining special exceptions and then determined that the court erred in dismissing the case.

4 . A court of appeals cannot reverse a trial court except upon properly assigned points of error, adequately briefed. If an appellant fails to argue a ground that would warrant reversal, then the ground is waived. Vawterv. Garvey, 786 S.W.2d 263, 264 (Tex.1990) (per curiam); San Jacinto River Auth. v. Duke, 783 S.W.2d 209, 209-10 (Tex.1990) (per curiam); Kirby v. Cruce, 688 S.W.2d 161, 168 (Tex.App.—Dallas 1985, writ ref'd n.r.e.).

If an appellant argues an inconsequential ground while overlooking error in the controlling issue in the case, the error in the controlling issue is waived. In Texas Health Enterprises, Inc. v. Tolden, 795 S.W.2d 17, 18 (Tex.App.—El Paso 1990, no writ), the trial court struck the defendant’s answer asserting an affirmative defense and rendered a default judgment against the defendant. On appeal, the defendant challenged only the default judgment but did not attack the striking of its answer. The court of appeals held that the defendant’s failure to challenge on appeal the striking of its answer prevented the court from reviewing any error in the granting of the default judgment except for invalidity appearing on the face of the petition. See also Dolenz v. Pulse, 791 S.W.2d 572, 573 (Tex.App.—Dallas 1990, writ dism’d w.o.j.) (appellant challenged pretrial and trial rulings without attacking directed verdict). Therefore, if an appellant argues error only in the dismissal of the cause of action, the appellant waives any error in the sustaining of the special exceptions.

5 . We do not decide in this case whether the complaints for sustaining the special exceptions and dismissing the cause of action must be brought in separate points. At a minimum, however, the appellant must challenge the rulings in its brief.

6 . The dissent's discussion of the merits of appellant’s point is flawed. The dissent states that in order to establish tortious interference, one must show an intentional invasion or interference, 864 S.W.2d 570-71 (Rosenberg, J., dissenting), but fails to explain how appellant pleaded the element of intent. The dissent asserts that appellant’s allegation “that appellees committed tor-tious interference by falsely reporting an incorrect wage rate” satisfied all the elements of tor-tious interference. 864 S.W.2d 571 (Rosenberg, J., dissenting). Nowhere, however, does appellant allege the element of intent. Appellant alleged only that appellees "falsely” reported her wages, not that they intentionally reported her wages falsely. Accordingly, the dissent is in error in concluding that appellant’s petition stated a cause of action for tortious interference.

7 . Section 12d states:

Upon its own motion or upon the application of any person interested showing a change of condition, mistake or fraud, the Board at any time within the compensation period, may review any award or order, ending, diminishing or increasing compensation previously awarded, within the maximum and minimum provided in this Law....

Tex.Rev.Civ.Stat.Ann. art. 8306, § 12d (Act of May 20, 1931, 42d Leg., R.S., ch. 155, § 1, 1931 Tex.Gen. Laws 260, repealed by The Texas Workers' Compensation Act, 71st Leg., 2d C.S., ch. 1, § 16.01(7), 1989 Tex.Gen.Laws 1, 114).