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Election of Remedies (C20)

Election of remedies is an affirmative defense raised by ICs to an IE's claim under the Texas Workers' Compensation Act. Allstate Ins. Co. v. Perez, 783 S.W.2d 779 (Tex. App.-Corpus Christi 1990, no writ). The IC has the burden of proof on this issue. APD 032585. In such cases, the IC must prove that the IE has elected to seek recovery/treatment from a source outside of the workers' compensation system, and that it would be unfair to allow recovery from two different sources for the same injury. Whether an IE has made an election of remedies in a given scenario is a question of fact for the ALJ to resolve. APD 93662. In Bocanegra v. Aetna Life Insurance Company, 605 S.W.2d 848 (Tex. 1980), the Texas Supreme Court held an election of remedies is only made as a result of an (1) informed choice (2) between two or more rights, remedies, or states of fact (3) which are so inconsistent as to (4) constitute manifest injustice. Also, the Bocanegra case makes clear that an election-of-remedies defense should be imposed sparingly, reserved for instances where the "assertion of a remedy, right, or state of facts is so unconscionable, dishonest, contrary to fair dealing, or so stultifies the legal process or trifles with justice or the courts as to be manifestly unjust." Id at 851. APD 990525.

Current Viability of the Election-of-Remedies Defense.

In Valley Forge Insurance Company v. Austin, 65 S.W.3d 371 (Tex. App.-Dallas 2001, pet. denied with per curiam opinion), the court of appeals held the election of remedies affirmative defense was abolished by Texas Labor Code (TLC) Section 409.009 because it permitted subclaims by ICs and health care providers as a means to prevent double recoveries. The Texas Supreme Court affirmed that decision for other reasons and stated it left open the question of whether TLC Section 409.009 abolished the election-of-remedies affirmative defense. Valley Forge Ins. Co. v. Austin, 105 S.W.3d 609 (Tex. 2003). See also APD 030473.

Extraterritorial Jurisdiction.

An IE who elects to get workers' compensation benefits paid by another state may not recover workers' compensation benefits under the laws of Texas. TLC Section 406.075. In some instances, an IE may receive benefits from another state without making an election to do so. In such a case, the IE may still pursue benefits in Texas and the amount the IE received in benefits from the other state will be subtracted from the benefits paid under Texas law. See TLC Section 406.075(b), APD 032459. [Cross reference: Extraterritorial injury (C19)].

In APD 032459, the decedent sustained a compensable fatal injury while on temporary assignment in Florida. The beneficiaries made no claim for Florida workers' compensation benefits, but the Florida IC began paying death benefits to the beneficiaries. The beneficiaries filed a claim in Texas. The beneficiaries are entitled to Texas death benefits less the benefits paid by the Florida IC because there was no election to be paid Florida death benefits.

Professional Athlete.

A professional athlete employed under a contract for hire or a collective bargaining agreement who is entitled to benefits for medical care and weekly benefits that are equal to or greater than the benefits provided under this subtitle may not receive benefits under the Act and the equivalent benefits under the contract or collective bargaining agreement. An athlete covered by such a contract or agreement who sustains an injury in the course and scope of the athlete's employment shall elect to receive either the benefits available under this subtitle or the benefits under the contract or agreement. TLC Section 406.095. 28 Texas Administrative Code (TAC) Section 112.402(a) lists the instances in which medical care available to a professional athlete subject to Section 406.095 is equal to or greater than medical benefits under the Act.

In Gulf Insurance Company v. Hennings, the IE, a player for the Dallas Cowboys Football Club, Ltd, sustained a neck injury during a game. The employer terminated the IE's contract in March 2001. After his termination, the IE received a payment as provided by an injury protection clause in his contract, because he was severely injured and terminated while injured or rehabilitating from his injury. He also received severance pay unrelated to his injury. Although the employer had paid medical expenses for the IE's injury, all medical benefits under the contract ceased when the contract was terminated. The IE filed a claim for workers' compensation benefits. The ALJ determined that the IE was not barred from pursuing workers' compensation benefits because his employment medical benefits were not equal to or greater than the benefits under the Act, as the IE's medical benefits had expired when the contract was terminated. On appeal the court stated the Act requires that both income and medical benefits from employment, considered separately, must each be equal to or greater than the corresponding income benefits and medical benefits available under the Act. The court held that the IE was not precluded from workers' compensation benefits in addition to his employment benefits. Gulf Ins. Co. v. Hennings, 283 S.W.3d 381 (Tex. App.-Waco 2008, pet. denied).

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