Court of Appeals of Texas,

Beaumont.

Johnny D. GILMORE, Appellant

v.

Evelyn CORLEY, Fidelity & Casualty Company of New York, Continental Loss Adjusting Company and Underwriters Adjusting Company, Appellees.

No. 09-92-303 CV.

|

Nov. 24, 1993.

Before WALKER, C.J., and BROOKSHIRE and BURGESS, JJ.

WALKER, Chief Justice.

OPINION

*1 This is an appeal by Johnny D. Gilmore, appellant herein, and plaintiff below, from the entry of a summary judgment favoring appellees. Appellant sustained an injury on July 27, 1988, while in the course and scope of his employment with Jubilee Leasing. The workers’ compensation carrier for Jubilee was Fidelity & Casualty Company of New York (Fidelity). Appellees, Underwriters Adjusting Company and Continental Loss Adjusting Company, were the adjusting companies for Fidelity. Evelyn Corley, the claims adjuster, was an employee of Underwriters and subsequently for Continental. Corley was responsible at all times for adjusting appellant’s claim.

Following his injury and on the advice of his personal physician, Gilmore consulted with Donald Ronald Kerr, an orthopedic surgeon. Various diagnostic tests were preformed and a course of conservative physical therapy was ordered for Gilmore.

On September 16, 1988, a computerized tomography scan was performed by a radiologist who offered an opinion that Gilmore had a small central herniated nucleus pulposus at the junction of the fifth lumbar vertebra and the sacrum region of his spine.

Dr. Kerr then referred Gilmore to Dr. Hans Wendenberg, a neurosurgeon. On October 24, 1988, Dr. Wendenberg noted all of Gilmore’s symptoms and, together with the results of the computerized tomography scan, the doctor made a preliminary diagnosis that the plaintiff suffered from a herniated nucleus pulposus. Based on that conclusion, the doctor prescribed various tests so that he could make a final diagnosis. On December 27, 1988, after the tests were performed, Dr. Wendenberg recommended corrective surgery to Gilmore’s lower back.

Appellee, Fidelity, in accordance with applicable statutes requested an opinion by Dr. Gregory Hanson, an orthopedic surgeon. Dr. Hanson performed an examination on Gilmore on January 24, 1989, and although he found a bulging disc in Gilmore’s back, he concluded that no surgery was necessary on Gilmore. Also, he could see no indication for any further diagnostic studies. In asserting his objectivity, Dr. Hanson testified on deposition that in the past he had recommended surgery for certain patients when referred to him by an insurance company. It was his opinion that the bulging disc was the result of the aging process and definitely not attributable to a specific trauma. Mr. Gilmore was 35 years of age at the time.

Appellees then referred appellant to Dr. Richard Hirschberg, a neurosurgeon, who examined him between April 17, 1989 and April 21, 1989. Various diagnostic tests were performed. Dr. Hirschberg told Gilmore that he could very well have some form of disc herniation and nerve root compression that he was not seeing specifically in any of the films. Dr. Hirschberg stated that another opinion from either an orthopedic or neurosurgeon reviewing all the tests and studies done including the initial myelogram and recent MRI, should be undertaken. He did not say that surgery was not indicated, just that the studies he conducted did not indicate surgery.

*2 By August 30, 1989, Dr. Wendenberg repeated various diagnostic procedures at Northwest Medical Center Hospital in anticipation of performing surgery on Gilmore at that time. Dr. Wendenberg determined that even though there was a small abnormality, surgery was cancelled. The doctor also noted elevated cholesterol, elevated glucose level and high blood pressure in Gilmore. He then referred him to his family physician for treatment of these conditions. Surgery on Gilmore was performed approximately one year later, and the expense was borne by appellees after the fact.

Although this action originated as a suit to set aside the award of the Industrial Accident Board of the State of Texas in connection with Gilmore’s workers’ compensation claim, Gilmore amended his petition to allege a cause of action for breach of the common law duty of good faith and fair dealing in connection with the denial or delay of authorization for surgery. The action for the workers’ compensation claim was settled prior to a hearing on appellees’ motion for summary judgment. The dispute before the trial court was centered on the alleged delay by the appellees in authorizing the surgery which was performed on the appellant. After appellees moved for summary judgment, appellant amended his pleadings to include a cause of action based on violations of the Tex. Ins.Code Ann. art. 21.21 and the Texas Deceptive Trade Practices Act. After due notice and hearing, a summary judgment was entered in favor of the appellees in the trial court.

The controlling case governing a cause of action for the breach of the duty of good faith and fair dealing against a workers’ compensation carrier is Aranda v. Insurance Co. of North America, 748 S.W.2d 210 (Tex.1988). To prevail in that cause of action a claimant must establish the absence of a reasonable basis for denying or delaying payment of benefits and that the carrier knew or should have known that there was not a reasonable basis for such denial or delay. St. Paul Guardian Ins. Co. v. Luker, 801 S.W.2d 614 (Tex.App.-Texarkana 1990, no writ).

We are again faced with the conflictive holdings between this Court of Appeals, State Farm Fire & Cas. Co. v. Simmons, 857 S.W.2d 126 (Tex.App.-Beaumont 1993, writ requested) and the San Antonio Court of Appeals in State Farm Lloyds, Inc. v. Polasek, 847 S.W.2d 279 (Tex.App.-San Antonio 1992, writ requested) regarding reasonable basis to deny coverage. The case presently before us is yet another example of an insurance carrier choosing to believe its evidence over evidence offered by the insured. Polasek holds that, “[i]n a bad faith action, the issue is whether there was evidence in existence before State Farm; the issue is not whether State Farm correctly evaluated the evidence before it….” Id. at 285.

In Simmons, we at length disagreed that “reasonable basis” as relative to the denial of insurance coverage, should be determined by the insurer. 857 S.W.2d at 134.

*3 Here, appellant’s doctor determined that appellant needed surgery. Appellees, dissatisfied with this medical determination, sought further medical evaluation by a doctor of appellees’ choosing who determined no necessity for surgery. Appellees then referred appellant to a second doctor of appellees’ choosing who did not say that surgery was not indicated, only that his studies did not indicate a necessity for surgery.

When we couple the foregoing events with the legal duty imposed upon appellees to maintain “that degree of care and diligence which a man of ordinary prudence would exercise in the management of his own business”, See Arnold v. Nat. County Mut. Fire Ins. Co., 725 S.W.2d 165 (Tex.1987). We determine that a question of fact arises as to whether the carrier was furthering its own interests as opposed to the health interest of appellant.

It is sometimes difficult to apply the “man of ordinary prudence” standard of care to an entity such as an insurer dealing with its insured.

The case before us, we believe, speaks to the problem directly. Appellant sought medical advice and diagnosis from an orthopedic surgeon and a neurosurgeon. The neurosurgeon determined that corrective surgery on appellant’s lower back was indicated. Now, considering only the best interest of the beneficiary, Mr. Gilmore, and understanding Mr. Gilmore’s willingness to undergo the knife based upon expert medical advice, why would appellees demand a second and third opinion? Was it to protect Mr. Gilmore from unnecessary surgery? The bottom line is that about seventeen months after Mr. Gilmore began his quest for medical treatment, in an effort to improve his life, he finally underwent the medical surgery.

Did appellees breach that duty of good faith and fair dealing owed Mr. Gilmore? This is the question of fact to be determined at trial on the merits.

Under the facts before us, we determine the case of Guajardo v. Liberty Mut. Ins. Co., 831 S.W.2d 358 (Tex.App.-Corpus Christi 1992, writ denied) as beneficial. The court there found that material questions of fact precluded entry of a summary judgment for the carrier because the central issue was whether the claimant was so incapacitated that he could not return to work. We agree with the test employed by the Corpus Christi Court in stating, “[w]e believe that the weight of contrary expert opinion necessary to destroy the carrier’s reasonable basis is a question of fact for the jury … [citing Aranda, 748 S.W.2d at 213, and Arnold, 725 S.W.2d at 167].” 831 S.W.2d at 365. We also agree that a legitimate conflict between the carrier’s experts and the medical experts employed by the claimant may or may not, standing alone, be sufficient to allow the case before us to go to the jury.

Here, we have circumstantial evidence that the opinion of Dr. Hanson, one of the carrier’s medical experts was questionable. Dr. Hanson stated unequivocally that he found a bulging disc in Gilmore’s back but could not see any indication for surgery nor for any further diagnostic studies. He also firmly testified that the bulging disc was the result of the aging process of Gilmore even though he was only 35 years of age at the time of the injury on the job. Dr. Hanson also stated that the bulging disc was definitely not attributable to a specific trauma. In fact, the carrier never denied Gilmore’s injury to his lower back and that it occurred at a date certain while in the employment with Jubilee Leasing.

*4 We also note that Dr. Hirschberg, another physician employed by the carrier, indicated that further testing and investigation by another orthopedic surgeon or neurosurgeon was indicated. The disagreements among the medical experts and the need for further investigation was sufficient to raise fact issues requiring the intervention of a jury.

We recognize all reasonable inferences to be in favor of the appellant, we resolve all doubts in his favor and we recognize that appellees have the burden of proof in showing that there is no genuine issue of material fact and that they are entitled to judgment as a matter of law. Nixon v. Mr. Property Management Co., 690 S.W.2d 546 (Tex.1985). The granting of summary judgment on behalf of appellees by the trial court is reversed.

Appellant brings two points of error grounded on the trial court’s refusal to grant appellant’s first and second motions for partial summary judgment. There is no order in the transcript reflecting that the trial court ever ruled on either of these motions. By granting appellee’s motion for summary judgment, a final and complete disposition was made of all parties and issues. The issues raised in appellant’s points of error seven and eight are not properly before the Court.

The Court finds that the trial court granting of summary judgment in favor of appellees should be reversed and remanded for trial on the merits.

REVERSED AND REMANDED.