Court of Appeals of Texas, Thirteenth District, Corpus Christi-Edinburg
BERRY CONTRACTING, L.P., D/B/A BAY LTD. AND JUAN TOMAS HERNANDEZ ALVAREZ, Appellants,
GERNAL RANDOLPH MANN AND JENNIFER MANN, Appellees.
appeal from the County Court at Law No. 3 of Nueces County,
Justices Rodriguez, Benavides, and Longoria
V. RODRIGUEZ Justice
Berry Contracting, L.P., d/b/a Bay Ltd. employed appellee
Gernal Randolph Mann as its foreman for a project at a Valero
refinery. Mann was injured crossing a road near the refinery,
and he and his wife Jennifer ("the Manns") filed
suit against Bay and Juan Tomas Hernandez Alvarez
(collectively, "Bay"). Bay asserted that the
Manns' suit was barred by the exclusive-remedy defense or
"comp bar." The trial court granted partial summary
judgment in favor of the Manns, disposing of Bay's
granted this permissive appeal to address four questions
posed by the trial court concerning the exclusive-remedy
defense. See Tex. R. App. P. 28.3. Because we
resolve each of these questions in favor of Bay, we reverse
the summary judgment and remand to the trial court for
October 8, 2015, Mann clocked in to work at 6:44 a.m. at a
terminal on the side of Up River Road in Corpus Christi,
Texas. Around 6:47 a.m., as Mann walked across the road, he
was struck by a vehicle driven by Alvarez, also an employee
of Bay. There are four different versions of what Mann was
intending to do as he crossed the road: (1) gathering water
for his workers, (2) preparing for a safety meeting, (3)
going to look at an excavation site to determine what
paperwork he would need to obtain from Valero before his men
could commence work, or (4) walking to his truck to get out
of the rain.
submitted proof that at the time of the accident, Mann was
employed as Bay's foreman for a project at the Bill
Greehey Refinery owned by Valero ("the refinery").
The refinery is located on Up River Road and is relatively
close to the site of the accident.
alleges that Mann was covered by two separate, complementary
workers' compensation policies. One policy was a
"rolling owner controlled insurance program" that
was procured by Valero (the "ROCIP
policy"). The ROCIP policy covered the refinery and
was designed to provide blanket workers' compensation
coverage to contractors who worked on Valero projects (such
as Bay), as well as their employees (such as Mann).
other policy was procured by Bay for the general protection
of its employees (the "standard policy"). When Bay
signed the ROCIP policy, it also executed a document which
excluded any work at the refinery from the scope of its
standard policy. Thus, according to Bay, any work-related
injury to a Bay employee was to be covered under either
Valero's ROCIP policy or Bay's standard policy, but
Mann's injury, Bay submitted notice to the carriers for
both policies. Both denied coverage. The agent for the
standard-policy carrier asserted that Mann was injured at the
refinery, and therefore his injuries were covered by
Valero's ROCIP policy and excluded from Bay's
standard policy. The agent for the ROCIP carrier took the
position that Mann was not in the course and scope of his
employment when he was injured, and therefore his injuries
were not compensable under the Texas Workers'
Compensation Act ("the Act").
Manns filed this personal injury suit against Bay and
Alvarez. Bay sent multiple inquiries to both workers'
compensation carriers, asking them to provide benefits to
Mann, but both carriers continued to deny coverage. To
further pursue coverage and reimbursement from the carriers,
Bay filed a claim before the Division of Worker's
Compensation at the Texas Department of Insurance ("the
proceedings continued in the trial court. Bay filed a motion
for summary judgment, arguing that it was entitled to
judgment as a matter of law on the Manns' claims. Bay
maintained that because Mann sustained a work-related injury
and was covered by a workers' compensation policy, the
exclusive-remedy defense prevented the Manns from filing a
personal injury suit against Bay. The trial court denied
Manns filed a cross-motion for partial summary judgment,
attempting to defeat Bay's exclusive-remedy defense. The
trial court granted the Manns' motion and struck
Bay's exclusive-remedy defense. The trial court then gave
Bay leave to seek a permissive appeal in this Court
concerning four questions, which Bay raises as its issues on
1. Under Valero's Rolling Owner Controlled Insurance
Program ("ROCIP") and section 406.123 of the Labor
Code, was Bay an employer of Randy Mann for purposes of the
exclusive remedy defense?
2. Under the law of agency and quasi-estoppel, is Bay
precluded from asserting the exclusive remedy defense because
of the ROCIP carrier's denial of coverage to date?
3. Because of the ROCIP carrier's denial of coverage to
date, does section 408.001(d) of the Labor Code preclude Bay
from asserting the exclusive remedy defense?
4. Was Randy Mann in the course and scope of his employment
at the time of his accident?
granting this permissive appeal, we asked the parties to
brief a jurisdictional question: whether the Division has
exclusive jurisdiction over this suit pursuant to
American Motorists Insurance Co. v. Fodge. 63 S.W.3d
801, 805 (Tex. 2001). The Act vests the Division with
exclusive jurisdiction to determine the ultimate question of
whether the claimant is entitled to workers' compensation
benefits. Id. at 803. In Fodge, the court
held that because a claim for bad-faith denial of benefits
depends upon the ultimate question of whether the claimant
was entitled to benefits in the first place, the bad-faith
issue was also subject to the Division's exclusive
jurisdiction over compensability determinations. Id.
initial estimation, it seemed reasonable that under
Fodge, the Division's exclusive jurisdiction
over compensability determinations would include the
parties' dispute here. The parties have debated the issue
of whether Mann was injured in the course and scope of his
employment, and it is said that "[w]hether the injury
occurred in the course and scope of employment is an issue
that regards compensability." See Morales v. Liberty
Mut. Ins. Co., 241 S.W.3d 514, 518 (Tex. 2007). The
parties also dispute whether a valid workers'
compensation policy applies to Mann and protects Bay, which
is also part of the Division's ultimate compensability
determination. See In re Tex. Mut. Ins. Co., 157
S.W.3d 75, 81 (Tex. App.-Austin 2004, orig.
two reasons compel us to conclude that the Division does not
have exclusive jurisdiction. First, "[t]he determination
of whether any type of claim is within the exclusive
jurisdiction of the [Division] depends on whether the claim
is based on a claimant's entitlement to benefits."
Bestor v. Serv. Lloyds Ins. Co., 276 S.W.3d 549, 553
(Tex. App.-Waco 2008, no pet.) (quoting Pickett v. Tex.
Mut. Ins. Co., 239 S.W.3d 826, 835 (Tex. App.-Austin
2007, no pet.)). The Manns' personal injury suit touches
on many of the same subsidiary inquiries that would be posed
in a Division proceeding to determine whether a claimant was
ultimately entitled to compensation (e.g., course and scope),
but the Manns' personal injury suit is not "based
on" the ultimate question of whether Mann was eligible
for workers' compensation benefits. See id.;
Tex. Mut. Ins. Co. v. Sonic Sys. Intern., Inc., 214
S.W.3d 469, 481 (Tex. App.-Houston [14th Dist.] 2006, pet.
denied) (combined appeal & orig. proceeding) (concluding
that contract claims were not subject to the Division's
exclusive jurisdiction because while the contract claims
involved similar issues as a proceeding before the Division,
the contract claims "do not depend on the final
determination" of compensability itself). There is no
aspect of the personal injury suit that requires Mann to
ultimately be eligible for workers' compensation
benefits, unlike the claim for bad-faith denial of benefits
in Fodge; just the opposite, if Mann's injury is
compensable, this would likely bar the Manns' suit
pursuant to the exclusive-remedy defense. See Walls
Reg'l Hosp. v. Bomar, 9 S.W.3d 805, 806 (Tex. 1999)
(per curiam). Accordingly, the Manns' claim is not
"based on" Mann's entitlement to benefits, and
their suit is not subject to the Division's exclusive
jurisdiction to determine the ultimate question of whether
the claimant is entitled to workers' compensation
benefits. See Bestor, 276 S.W.3d at 553.
the main subject of this appeal is the exclusive-remedy
defense; both parties' motions for summary judgment
concerned the exclusive-remedy defense, and the trial court
granted leave to appeal issues related to the
exclusive-remedy defense. This favors the conclusion that the
Division does not have exclusive jurisdiction: the
Division's exclusive jurisdiction "does not extend
to all cases that touch on workers' compensation issues.
The district courts decide disputes about whether the
Act's exclusive remedy provision applies as a
defense to an injured worker's personal injury
suit." AMS Const. Co., Inc. v. K.H.K. Scaffolding
Houston, Inc., 357 S.W.3d 30, 38 (Tex. App.-Houston [1st
Dist.] 2011, pet. dism'd) (emphasis added) (citing two
cases in which the Texas Supreme Court decided substantive
issues concerning the exclusive-remedy defense). That is, the
main subject of this appeal is an issue which falls within
the jurisdiction of the district court, not the Division.
this suit is not based on Mann's entitlement to
worker's compensation benefits, and because this appeal
concerns the exclusive-remedy defense, it is not subject to
the Division's exclusive jurisdiction.
main subject of this appeal is Bay's exclusive-remedy
defense. In the Manns' motion for summary judgment, they
asserted that Bay did not qualify for two elements of the
defense: Bay was not Mann's "employer, " as
that term is used in the Act, and Mann was not injured while
in the "course and scope" of his employment. The
trial court summarily dispensed with Bay's
exclusive-remedy defense, ruling in favor of the Manns.
recovery of workers' compensation benefits is the
exclusive remedy of (1) an employee covered by workers'
compensation insurance coverage (2) against the employer, or
another employee of the employer (3) for a work-related
injury sustained by the employee (i.e., injury in the course
and scope of employment). Tex. Lab. Code Ann. §
408.001(a) (West, Westlaw through 2017 1st C.S.); see
Payne v. Galen Hosp. Corp., 28 S.W.3d 15, 18 (Tex. 2000)
(interpreting "work-related injury" to mean injury
in the course and scope of employment). Exclusive remedy is
an affirmative defense. Vega v. Silva, 223 S.W.3d
746, 748 (Tex. App.-Dallas 2007, no pet.); Pierce v.
Holiday, 155 S.W.3d 676, 678 (Tex. App.-Texarkana 2005,
first and fourth issues, Bay asserts that it satisfied both
elements of the exclusive-remedy defense which were
challenged in the trial court: that Bay was Mann's
"employer or an agent or employee of the employer"
and that Mann's injury occurred in the "course and
scope" of his employment. See Tex. Lab. Code
Ann. § 408.001(a). Bay asserts that it has conclusively
proved these elements or, in the alternative, that there is
at least a fact issue which prevents the summary disposal of
A.Standard of ...