Texas Workers' Compensation Commission, the Subsequent Injury Fund, and Todd Brown in His Official Capacity as Executive Director of the Texas Workers' Compensation Commission v. Texas Builders Insurance Company

CourtCourt of Appeals of Texas
DecidedJune 17, 1999
Docket03-98-00341-CV
StatusPublished

This text of Texas Workers' Compensation Commission, the Subsequent Injury Fund, and Todd Brown in His Official Capacity as Executive Director of the Texas Workers' Compensation Commission v. Texas Builders Insurance Company (Texas Workers' Compensation Commission, the Subsequent Injury Fund, and Todd Brown in His Official Capacity as Executive Director of the Texas Workers' Compensation Commission v. Texas Builders Insurance Company) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Texas Workers' Compensation Commission, the Subsequent Injury Fund, and Todd Brown in His Official Capacity as Executive Director of the Texas Workers' Compensation Commission v. Texas Builders Insurance Company, (Tex. Ct. App. 1999).

Opinion

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN




NO. 03-98-00341-CV

Texas Workers' Compensation Commission, The Subsequent Injury Fund, and

Todd Brown in his Official Capacity as Executive Director of the

Texas Workers' Compensation Commission, Appellants



v.



Texas Builders Insurance Company, Appellee



FROM THE DISTRICT COURT OF TRAVIS COUNTY, 345TH JUDICIAL DISTRICT

NO. 96-05784, HONORABLE F. SCOTT McCOWN, JUDGE PRESIDING

Appellants Texas Workers' Compensation Commission, the Subsequent Injury Fund (the "Fund"), and Todd Brown in his official capacity as Executive Director of the Workers' Compensation Commission (collectively the "Commission") appeal the final judgment of the trial court declaring that appellee Texas Builders Insurance Company ("TBIC") was entitled to reimbursement from the Fund pursuant to Texas Labor Code section 410.205(c) and awarding to TBIC attorney's fees. In six points of error, the Commission challenges the trial court's jurisdiction, asserts as error the trial court's conclusion that TBIC is entitled to reimbursement, and challenges the award of attorney's fees. We will affirm.

BACKGROUND

This case concerns the legislative scheme awarding benefits to injured workers under the Workers' Compensation Act of 1989 (the "Act"). (1) We described this four-tiered system for the determination of claims in Texas Workers' Compensation Comm'n v. City of Bridge City, 900 S.W.2d 411 (Tex. App.--Austin 1995, writ denied):



Subchapter B provides first for the informal resolution of claims through a non-adversarial conference conducted by a 'benefit review officer' who may render an interlocutory order that benefits be paid or that they not be paid. The informal conference is a prerequisite to any further proceeding toward resolution of the claim. See Tex. Lab. Code Ann. §§ 410.021-.024 (West 1995). If issues remain unresolved after the conference, the parties may agree to resolve the claim by arbitration under Subchapter C; failing agreement in that regard, a party may elect to determine the claim by a contested-case proceeding under the provisions of Subchapter D. Id. §§ 410.101-.121 (arbitration); §§ 410.151-.169 (contested case). The third tier is established in Subchapter E, providing for an administrative appeal from the hearing officer's contested-case decision to an appeals panel. Id. §§ 410.201-.208. Review outside the Commission is authorized in Subchapter F, establishing a cause of action for judicial review of the appeals-panel decision or the hearing officer's decision if the appeals panel fails timely to render a decision. Id. §§ 410.251-.256.



The insurance carrier must commence making any payments ordered by the benefit-review officer. If the order is reversed or modified after arbitration or the contested-case proceeding, however, the carrier is entitled to reimbursement from the subsequent-injury fund for any overpayment. Id. § 410.025(c). And if the appeals-panel decision affirms the carrier's duty to pay, but the decision is finally modified or reversed by a reviewing court, the carrier is entitled to reimbursement for any overpayment. Id. § 410.205(c).



City of Bridge City, 900 S.W.2d at 413 (emphasis added).

In the instant case, Amador Guerrero sought compensation for injuries occurring on the job. A dispute over workers' compensation benefits arose between Guerrero and TBIC, his employer's workers' compensation insurance carrier. The Commission adjudicated the dispute according to the contested-case procedures described above, and the appeals panel affirmed the hearing officer's decision that Guerrero sustained a compensable injury and was entitled to benefits under the Act. TBIC filed suit in district court seeking judicial review of the adverse decision of the appeals panel pursuant to Subchapter F of the Act. See Act § 410.251-.256. Guerrero failed to answer the lawsuit. Consequently, the district court granted TBIC a no-answer default judgment. (2) TBIC then presented a claim to the Commission for reimbursement from the Fund for benefits paid to Guerrero pursuant to section 410.205(c), which provides:

If the court of last resort in the case finally modifies or reverses an appeals panel decision awarding benefits, the insurance carrier who has paid benefits as required by this section may recover reimbursement of any benefit overpayments from the subsequent injury fund.



Act § 410.205 (emphasis added). It is this claim for reimbursement that lies at the heart of this dispute.

The Commission denied TBIC's claim for reimbursement because the modification of the appeals panel order came as a result of a default judgment rather than a trial on the merits. The Commission opined that to do otherwise would allow TBIC to "game the system" and receive reimbursement from the Fund for benefits paid to Guerrero when Guerrero's claim had never been reversed on the merits. TBIC sought a declaratory judgment (3) in district court that the statutory language of section 410.205(c) required the Commission to reimburse TBIC, and that the Commission had no discretion to deny the claim. The trial court agreed and issued a final judgment declaring that TBIC was due reimbursement. The Commission appeals the judgment of the trial court in six points of error, arguing (1) the Act does not waive sovereign immunity nor does it authorize a suit by an insurance carrier against the Commission; (2) the Uniform Declaratory Judgments Act ("UDJA") does not waive sovereign immunity nor does it permit a private litigant to sue the Commission without obtaining permission from the legislature; (3) TBIC has no right to reimbursement for benefits paid to Guerrero because it obtained a no-answer default judgment; (4) an insurance carrier may not be reimbursed for payments made to an injured worker pursuant to a contested-case hearing officer's order during the period when the order is being appealed to the appeals panel; (5) the administrator of the Fund may exercise discretion in deciding whether to reimburse a claim made by an insurance carrier for reimbursement; and (6) the trial court abused its discretion in awarding attorney's fees because the UDJA does not authorize attorney's fees under these circumstances.



DISCUSSION

We initially note that the legislature has addressed the situation we consider in this cause through amendment to section 410.257 of the Labor Code, which now provides in relevant part: "A judgment under this section based upon default or on an agreement of the parties does not constitute a modification or reversal of an appeals panel decision awarding benefits for the purpose of Section 410.205." Act § 410.257(e) (West Supp. 1999). However, the parties stipulated that this language does not control the dispute before us; we therefore review this dispute under the language of section 410.205(c) unaffected by the amendment to section 410.257.

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