Martinez v. Second Injury Fund of Texas

789 S.W.2d 267, 33 Tex. Sup. Ct. J. 470, 1990 Tex. LEXIS 71, 1990 WL 58909
CourtTexas Supreme Court
DecidedMay 9, 1990
DocketC-8081
StatusPublished
Cited by12 cases

This text of 789 S.W.2d 267 (Martinez v. Second Injury Fund of Texas) is published on Counsel Stack Legal Research, covering Texas Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Martinez v. Second Injury Fund of Texas, 789 S.W.2d 267, 33 Tex. Sup. Ct. J. 470, 1990 Tex. LEXIS 71, 1990 WL 58909 (Tex. 1990).

Opinions

OPINION

MAUZY, Justice.

The issue in this workers’ compensation action is whether suits against the Second Injury Fund (Fund) must be filed within the same time period prescribed for actions to set aside decisions of the Industrial Accident Board (Board). We hold that notice to the Board is deemed and considered notice to and filing of a claim against the Fund.

Vera N. Martinez, whose right leg was impaired by childhood polio, injured her left leg at work. The Standard Fire Insurance Company contested its liability for the extent of the work injury both before the Board and the trial court.

Before trial, Standard Fire Insurance Company conceded its liability for 100 percent permanent disability to Martinez’ left leg, and obtained leave of court to join the Second Injury Fund as a third party. Thereafter, Martinez filed a third party petition against the Second Injury Fund to obtain compensation for the remainder of total and permanent disability benefits. The Fund moved to dismiss both claims against it for want of jurisdiction on the ground that neither was filed within twenty days after Martinez’ notice to the Board that she would not abide by its decision, the period prescribed by article 8307, section 5, TEX.REV.ClV.STAT.ANN. (Vernon Supp. 1990).1 The district court denied the Fund’s motion.

Trial was to a jury, which found that Martinez had lost the use of her right leg due to polio, and that the lost use of both legs had left her totally and permanently incapacitated for work. Based upon the jury’s findings, Martinez recovered judgment against Standard Fire for 100 percent permanent disability to her left leg (representing 200 weeks of compensation to the date of the jury verdict), and the balance of compensation due for her total and permanent incapacity benefits from the Fund.

Holding that the district court lacked jurisdiction against the Fund as a party not named to the action within the time permitted by article 8307, section 5, the court of appeals reversed and rendered judgment that Martinez recover nothing from the Fund. 756 S.W.2d 877.

The Fund’s History

The Second Injury Fund was created by the Legislature in 19472 to remedy an inequity in the Workmen’s Compensation Law of 1917.3 Part I, section 12c of the 1917 law4 provided that an employee incapacitated by a combination of injuries over a period of time could recover for the later injury only the compensation to which he would have been entitled had he not been previously injured. As explained in Miears v. Industrial Accident Board, 149 Tex. 270, 232 S.W.2d 671, 672 (1950), the purpose of this provision was

to encourage the employment of persons physically handicapped by previous injuries. Obviously, an employer would be discouraged from employing such persons if he knew that under the law his insurer would become liable in the event of a second injury for the disability resulting from the combined effect of the two injuries, and not merely for the disability resulting from the second injury considered alone.

[269]*269The salutary purpose notwithstanding, the result was that an employee would recover less compensation if he were totally and permanently incapacitated by a series of injuries than he would recover were he to suffer the same incapacity from a single injury. Id. 232 S.W.2d at 673. To alleviate this inequity without impinging upon the policy supporting section 12c, the Legislature amended that section and added sections 12c-l and 12c-25 to create a Second Injury Fund from which an employee who is totally and permanently incapacitated by successive specific injuries can recover the additional compensation due for such incapacity over the amount due for the later injury. See id. 232 S.W.2d at 673-676; Second Injury Fund v. Keaton, 162 Tex. 250, 345 S.W.2d 711 (1961).

Application of Article 8307, Section 5 to the Fund

Article 8307, section 5 provides in pertinent part:

Whenever [a workers’ compensation] suit is brought, the rights and liability of the parties thereto shall be determined by the provisions of this law, and the suit of the injured employee or person suing on account of the death of such employee shall be against the Association, if the employer of such injured or deceased employee at the time of such injury or death was a subscriber as defined in this law. If the final order of the Board is against the Association, then the Association and not the employer shall bring suit to set aside said final ruling and decision of the Board, if it so desires, and the Court shall in either event determine the issues in such cause ... (1977) (emphasis added).

As the Fund concedes in its brief to this court, this article mandates not only when suit should be instituted but also against whom such suit should be brought within the specified limitations period. Neither this nor any other statute specifies that its provisions apply to actions involving the Fund.

By statute, the Fund is neither “the association” nor an insurance company. “Association” is defined in article 8309, section 1 as follows:

Definitions ...
“Association” shall mean the “Texas Employers’ Insurance Association” or other insurance company authorized under this Act to insure the payment of compensation to injured employees or to the beneficiaries of deceased employees.

An “insurance company” is defined in article 8309, section 2 as an insurance company lawfully transacting a liability or accident business in Texas. Neither definition mentions or includes the Fund. Further, article 8306, section 12c-2 which creates the Fund and defines its procedures, does not include the Fund as an “insurer” or “the Association.” Indeed, the statute provides that the Fund is essentially a bank account, comprised of payments by insurance companies from workers’ compensation death benefits due workers with no beneficiaries. Article 8306, sections 12c and 12c-l prescribe the manner in which the Fund must pay out money. Neither these nor any other section of the Workers’ Compensation Act provide that suits against the Fund are subject to the provisions of article 8307, section 5. Nor does any section incorporate article 8307, section 5 by reference. The Legislature has carefully specified that the only cases to which article 8307, section 5 applies are those governed by its own terms and those in which its terms are incorporated by reference.

In Johnson v. Second Injury Fund, 688 S.W.2d 107 (Tex.1985), we held that the Fund is not the same as an insurer, procedurally or substantively. In Johnson, the Fund sought to establish for itself the right of subrogation that insurers have, even though the statutes creating the Fund are silent on the question of subrogation. This Court expressly rejected this argument, [270]

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Second Injury Fund v. Tomon
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Martinez v. Second Injury Fund of Texas
789 S.W.2d 267 (Texas Supreme Court, 1990)

Cite This Page — Counsel Stack

Bluebook (online)
789 S.W.2d 267, 33 Tex. Sup. Ct. J. 470, 1990 Tex. LEXIS 71, 1990 WL 58909, Counsel Stack Legal Research, https://law.counselstack.com/opinion/martinez-v-second-injury-fund-of-texas-tex-1990.