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American Home Assur. Co. v. Texas Workers' Compensation Com'n
March 15, 2001
Unpublished Opinion

American Home Assur. Co. v. Texas Workers' Compensation Com'n

Court of Appeals of Texas, Austin.



TEXAS WORKERS’ COMPENSATION COMMISSION and Christopher D. Huebner, Appellees.

No. 03-00-00545-CV.


March 15, 2001.

From the District Court of Travis County, 53rd Judicial District, No. 99-14827; Charles F. Campbell, Judge Presiding.




*1 After the State Office of Administrative Hearings (“SOAH”) preauthorized treatment to Christopher Huebner in a medical benefits dispute, American Home Assurance Co. (“American”) sought judicial review of the administrative order by filing an action against the Texas Workers’ Compensation Commission (“the Commission”) and Huebner in district court.1 American appeals from a district court order granting the Commission’s plea to the jurisdiction. Tex.Gov’t Code Ann. § 2001.171 (West 2000). We reverse the district court judgment granting the Commission’s plea to the jurisdiction.

Factual and Procedural Background

On December 9, 1996, Huebner was exposed to and inhaled vaporized chemicals while on the job.3 Huebner later developed a medical condition known as chronic inflammatory demyelinating polyneuropathy. Huebner alleges that he discovered his injury on May 23, 1997. In a matter presently pending in district court, American has contested Huebner’s claim of a compensable injury.

The Center for Immune Environmental & Toxic Disorders requested preauthorization from American to provide Huebner with weekly intravenous gamma globulin treatment for twelve weeks. After American refused to preauthorize such treatments, the Center filed a request with the Medical Review Division of the Commission for medical dispute resolution. The Medical Review Division ordered Huebner to undergo a medical examination with an independent physician who was chosen by the Commission. Because the independent physician disagreed with the Center’s recommended course of treatment, the Medical Review Division did not order preauthorization of Huebner’s treatments. Huebner appealed the Medical Review Division’s decision to SOAH. The administrative law judge reversed the Medical Review Division’s decision and ordered preauthorization of the treatments.

Seeking judicial review of this order, American filed suit in district court. The Commission raised its plea to the jurisdiction in its first amended answer, arguing that American had no inherent or statutory right to judicial review. After the supreme court issued its opinion in Continental Casualty Insurance Co. v. Functional Restoration Associates, American amended its petition. 19 S.W.3d 393 (Tex.2000). The district court granted the Commission’s plea to the jurisdiction. American appeals the district court judgment.

Standard of Review

A plea to the jurisdiction challenges the district court’s authority to determine the subject matter of the cause of action. Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex.1998).

*2 The plaintiff bears the burden of pleading facts that show the district court has subject matter jurisdiction. Peek v. Equipment Serv. Co., 779 S.W.2d 802, 804 (Tex.1989). We must therefore determine whether American pleaded facts sufficient to allege that the district court had jurisdiction to review the administrative order.


Under Texas law, a plaintiff may seek judicial review of an administrative order in the following three instances: (1) a statute expressly provides for judicial review, (2) the order adversely affects a vested property right, or (3) the order violates some other constitutional right. Stone v. Texas Liquor Control Bd., 417 S.W.2d 385, 385-86 (Tex.1967).

In its first issue, American argues that it was entitled to judicial review based on its inherent right to due process under the United States and Texas Constitutions. See U.S. Const.amend. XIV, § 1; Tex. Const. art. I, § 19.4 Specifically, American contends that the administrative order from SOAH requires American to pay for Huebner’s treatments. American concludes that, because the order adversely affects its property interest in the monies owed for the preauthorized medical treatments, it has an inherent right to judicial review based on due process.

Relying in part on National Carloading Corp. v. Phoenix-El Paso Express, Inc., 176 S.W.2d 564, 570 (Tex.1943).

In Continental Casualty, this Court examined whether a vested property interest existed in “the money that the Commission’s hearing officer ordered Continental to pay ... [the defendants].” Continental Cas. Ins. Co., 964 S.W.2d at 782. We concluded that the hearing officer’s decision, which affirmed an administrative order authorizing medical treatment, did affect a vested property interest. Id.

*3 In this case, an administrative order from SOAH preauthorized Huebner’s treatments. Section 413.014(b) of the Texas Workers’ Compensation Act states, “The insurance carrier is not liable for those specified treatments and services unless preauthorization is sought by the claimant or health care provider and either obtained from the insurance carrier or ordered by the commission.” Tex.Lab.Code Ann. § 413.014(b) (West 1996). Like the order in Continental Casualty, the administrative order here imposed liability on American for the costs of Huebner’s medical treatments. Given the procedural posture of this case, which prevents us from reaching the merits, the narrow issue before us is whether American has sufficiently alleged an inherent right to judicial review.

In its amended petition, American pleads that it “seeks judicial review of the Decision and Order of the State Office of Administrative Hearings ... pursuant to Tex.Lab.Code Ann. §§ 410 .255, Tex.Gov’t Code Ann. § 2001.171.” In listing the reasons the district court has jurisdiction to hear this matter, American asserts, “Plaintiff has an inherent right to judicial review under due process of law as provided in the Texas and United States Constitutions because the decision adversely affects Plaintiff’s protected vested property interest in its money.” American also addressed this assertion in its hearing brief in support of the court’s jurisdiction, which further argued its right to substantive due process. This hearing brief was filed on the same day that the district court issued its order granting the plea to the jurisdiction.

Citing the supreme court’s opinion in Continental Casualty Insurance Co. v. Functional Restoration Associates and this Court’s opinion in Carrizales v. Texas Department of Protective & Regulatory Services, the Commission asserts that American was required to do more in its petition than merely track the statutory language of the APA and identify the alleged constitutional violation. Carrizales v. Texas Dep’t of Protective & Regulatory Servs., 5 S .W.3d 922 (Tex.App.-Austin 1999, pet. denied). Both opinions inform our analysis in this case.

In Continental Casualty, the Texas Supreme Court considered whether Continental was entitled to judicial review of a medical benefits decision by the Commission’s Hearings Division.5 Id. at 404-05. In contrast, here, American’s petition expressly alleges its inherent right to judicial review based on due process under the United States and Texas Constitutions.

*4 In Carrizales, the appellant sought judicial review of an administrative order from SOAH that concluded he was guilty of neglect of a child. Id. at 925. This Court held that Carrizales had waived the issue. Id. Unlike Carrizales, American does not rely on identical language to support two independent grounds for judicial review, one based on the APA and another based on due process.

The Commission also asserts, “After reviewing the pleadings and hearing the arguments of counsel, Judge Campbell decided that American’s allegations were conclusory and did not go far enough to inform the trial court that American was asserting an independent constitutional claim apart from the statutory bases set forth in § 2001.174.” We cannot discern the district court’s reasons for granting the Commission’s plea to the jurisdiction from the record before us. Rather than dispute that an inherent right to judicial review based on due process may exist here, the Commission complains solely that American’s pleading is insufficient.

If a court can ascertain that a plaintiff’s allegations cannot state a cause of action, even if amended, then the court can properly grant a plea to the jurisdiction. Bybee, 331 S.W .2d at 917.

In this case, the Commission did not file special exceptions to challenge the sufficiency of the allegations American first pleaded in its amended petition.6 American asserts that it can cure any asserted deficiency. Because the issue here may be one of sufficiency of pleading, and not jurisdiction, American is entitled to an opportunity to replead. See Bybee, 331 S.W.2d at 917. We sustain American’s first issue.7


We conclude that American should be given the opportunity to amend its pleadings to allege facts demonstrating jurisdiction. Accordingly, we reverse the district court judgment and remand this case for further proceedings consistent with this opinion.



The record shows that Huebner is a pro se defendant who has not yet filed an appearance.


See U.S. Const.amend. XIV, § 1; Tex. Const. art. I, § 19.


When reviewing a plea to the jurisdiction, we take the factual allegations in the plaintiff’s petition as true unless challenged as fraudulently made to confer jurisdiction. See Brannon v. Pacific Employers Ins. Co., 224 S.W.2d 466, 469 (Tex.1949). Because the Commission does not challenge the factual allegations in American’s petition as fraudulent, our recitation of the facts is taken from the first amended petition and, for purposes of this appeal, the material facts are undisputed.


Although the Texas Constitution speaks of “due course of law,” no distinction should be drawn between that phrase and “due process of law.” Texas Workers’ Comp. Comm’n v. Garcia, 893 S.W.2d 504, 525 (Tex.1995).


Since January 1, 1995, the Commission’s Hearings Division has turned over hearings to review decisions of the Medical Review Division to SOAH. Tex.Lab.Code Ann. § 413.031(d) (West 1996).


The Commission contends that it “was unaware of the existence of the amended petition until some point in the hearing on [the Commission’s] plea to the jurisdiction,” characterizing this failure to serve as an innocent oversight by American.


Given our disposition on American’s first issue, we need not reach its second argument that the APA contains an independent right of judicial review for medical benefits disputes in workers’ compensation cases. Tex.Gov’t Code Ann. § 2001.171 (West 2000).

End of Document