Court of Appeals of Texas, Dallas.

Ronnie Gene PITTS and Texas Workers’ Compensation Insurance Facility, Appellants,

v.

ARCHITECTURAL UTILITIES, INC., Appellee.

No. 05-95-01490-CV.

|

March 18, 1997.

Before Justices OVARD, MALONEY, and WRIGHT.

OPINION

MALONEY, Justice.

*1 Ronnie Gene Pitts sued Architectural Utilities, Inc. (AU) for damages arising from an on-the-job injury. Texas Workers’ Compensation Insurance Facility (the Insurer) intervened and sued AU for equitable subrogation, statutory subrogation,¹ and equitable restitution to recoup workers’ compensation insurance benefits it paid to Pitts. The trial court granted AU’s motions for summary judgment against both Pitts and the Insurer. In one point of error each, Pitts and the Insurer contend that the trial court erred in granting the summary judgments. We affirm in part and reverse and remand in part.

BACKGROUND

AU was the general contractor on a building project in Grand Prairie, Texas. In 1991, Pitts was providing welding services at the Grand Prairie project. While working on the project, a trench caved in and buried Pitts. The cave-in caused his injuries.

Wayne Gruyewski, an AU superintendent, told Pitts that AU would pay his medical expenses if Pitts needed to see a doctor. When Pitts decided to see a doctor a few days after the incident, AU chose the doctor and made Pitts’s appointment.

Unknown to Pitts, AU submitted a claim to the Insurer, AU’s workers’ compensation carrier, for Pitts’s injury. Pitts began receiving the Insurer’s benefit checks. Thereafter, an Insurer employee, Linda Johnson, telephoned Pitts. Pitts told Johnson that he was a “contract rig welder” who used his own truck, equipment, and welding machine. After his conversation with Johnson, Pitts applied for and received workers’ compensation benefits, including advance benefits, for his injury throughout 1992 and into 1993.

In 1993, Pitts discussed the matter with an attorney and filed a formal election of remedies with the Workers’ Compensation Commission, choosing to pursue a common law claim against AU for damages. He sued AU shortly thereafter, alleging its negligence proximately caused his injury. The Insurer intervened, seeking restitution from AU for the amounts it paid in workers’ compensation benefits to Pitts.

SUMMARY JUDGMENT

In Pitts’s and the Insurer’s respective points of error, they contend that the trial court erred in granting AU’s summary judgment motions. Pitts argues that AU failed to prove each element of its election of remedies defense. The Insurer argues that AU failed to (1) establish that the Insurer did not discharge a debt for which AU was primarily liable, and (2) plead for summary judgment on its equitable restitution claim.

I. Standard of Review

The standard of review in summary judgment is well established. Tex.R.Civ.P. 166a(c); see McConnell v. Southside Indep. Sch. Dist, 858 S.W.2d 337, 341 (Tex.1993); Black v. Victoria Lloyds Ins. Co., 797 S.W.2d 20, 23 (Tex.1990); Nixon v. Mr. Property Mgmt. Co., 690 S.W.2d 546, 548-49 (Tex.1985); Gaines v. Hamman, 163 Tex. 618, 626, 358 S.W.2d 557, 563 (1962); Gulbenkian v. Penn, 151 Tex. 412, 416, 252 S.W.2d 929, 931 (1952); Ross v. Texas One Partnership, 796 S.W.2d 206, 209 (Tex.App.-Dallas 1990), writ denied per curiam, 806 S.W.2d 222 (Tex.1991). To be entitled to summary judgment on the basis of an affirmative defense, a defendant must present and conclusively prove each element of the defense. Swilley v. Hughes, 488 S.W.2d 64, 67 (Tex.1972).

*2 A motion for summary judgment must “stand or fall on the grounds expressly presented in the motion.” McConnell, 858 S.W.2d at 341. If the grounds for summary judgment are not expressly presented in the summary judgment motion itself, the motion is legally insufficient to support the judgment as a matter of law. Id. at 342 (citing Roberts v. Southwest Texas Methodist Hosp., 811 S.W.2d 141, 146 (Tex.App.-San Antonio 1991, writ denied) (op. on rehearing) (“When a motion for summary judgment asserts grounds A and B, it cannot be upheld on grounds C and D, which were not asserted, even if the summary judgment proof supports them and the responding party did not except to the motion.”)).

Pitts

1. Applicable Law

At the time of Pitts’ injury, the Texas Workers’ Compensation Act (the Act) prohibited an employee from seeking common law remedies from his employer for personal injuries suffered in the course and scope of employment. Tex.Rev.Civ.Stat.Ann. art. 8308-4.01(a).² The act provided that:

(a) … a recovery of workers’ compensation benefits under this Act is the exclusive remedy of an employee … against the employer or an agent, servant or employee of the employer for … a work-related injury sustained by a covered employee.

Tex.Rev.Civ.Stat.Ann. art. 8308-4.01(a). A person who is an independent contractor or is hired to perform work or provide a service as an employee of a person operating as an independent contractor did not qualify for workers’ compensation insurance coverage under the act. See Tex.Rev.Civ.Stat.Ann. arts. 8308-3.01(a); 8308-3.05(a)(1) & (b).³

Election of remedies is an affirmative defense that may bar a party from pursuing two inconsistent remedies. See Medina v. Herrera, 927 S.W.2d 597, 600 (Tex.1996). To prevail on an election of remedies defense, a defendant must establish that (1) the plaintiff successfully exercised an informed choice (2) between two remedies, (3) which are so inconsistent as to (4) constitute manifest injustice. See Medina, 927 S.W.2d at 600; American Savings & Loan Ass’n v. Musick, 531 S.W.2d 581, 588 (Tex.1975). A plaintiff who mistakenly pursues a remedy which does not exist as a matter of law does not elect a remedy. Fina Supply, Inc. v. Abilene Nat’l Bank, 726 S.W.2d 537, 541 (Tex.1989).

3. Application of Law to Facts

AU moved for summary judgment on its election of remedies defense, alleging that Pitts successfully elected to receive benefits under the workers’ compensation act and was barred from pursuing his common law remedies. Pitts’s responded, reciting that the summary judgment evidence established he was an independent contractor at the time of his on-the-job injury and, as a result, was not legally entitled to workers’ compensation benefits. Thus, he could not have made a valid election of remedies when he pursued a remedy that did not exist as a matter of law. Pitts further argues that, even if he had elected to receive workers’ compensation benefits, his election was not an informed one.

*3 Pitts characterized himself as a “contract rig welder” and told the insurer that he furnished his own truck and equipment. Pitts, however, filed a claim for and pursued workers’ compensation benefits by identifying himself as an employee on several forms. In interrogatory responses, Pitts identified AU as his employer, but also stated that he was a subcontractor, not an employee, on the Grand Prairie project.

In its appellate brief, AU acknowledges that questions of fact exist on whether Pitts was an AU employee or an independent contractor at the time he incurred his injury. AU, however, contends that, even if Pitts was an independent contractor at the relevant time, he nevertheless made a valid informed election of remedies by successfully claiming, receiving, and accepting the workers’ compensation benefits. The mere receipt of benefits, however, does not automatically establish that a person made an “informed” election of the workers’ compensation remedy. Medina, 927 S.W.2d at 603. Rather, the circumstances surrounding the accident dictate whether a worker should pursue a workers’ compensation claim or a common law claim. Id.

The summary judgment evidence establishes that a genuine issue of material fact exists on whether Pitts was an employee or an independent contractor when he incurred his injury. As a result, we are unable to determine whether Pitts was legally entitled to pursue the workers’ compensation benefits that he received and, consequently, whether he may have made a valid election of remedies. See, e.g., Fina Supply, Inc., 726 S.W.2d at 541. Because a genuine question of material fact exists, the trial court erred in granting summary judgment.

We sustain Pitts’s point of error.

The Insurer

In its sole point of error, the Insurer argues that the trial court erred in granting summary judgment on its equitable subrogation claim because none of AU’s summary judgment evidence showed that the Insurer did not discharge a debt for which AU was primarily liable. The Insurer also argues that the trial court improperly granted summary judgment on its equitable restitution claim because AU’s summary judgment motion did not plead for judgment on the Insurer’s equitable restitution cause of action.

1. Equitable Subrogation

a. Applicable Law

To establish a cause of action for equitable subrogation, a claimant must show that (1) it discharged a debt for which another party was primarily liable, and (2) it paid the debt involuntarily. See Argonaut Ins. Co. v. Allstate Ins. Co., 869 S.W.2d 537, 542 (Tex.App.-Corpus Christi 1993, writ denied). Generally, an insurer paying a claim under a policy becomes equitably subrogated to any cause of action that the insured may have against a third party responsible for the injury. See American Centennial Ins. Co. v. Canal Ins. Co., 843 S.W.2d 480, 482 (Tex.1992); McBroome-Bennett Plumbing, Inc. v. Villa France, Inc., 515 S.W.2d 32, 36 (Tex.Civ.App.-Dallas 1974, writ ref’d n.r.e.). An insurer, however, is not entitled to equitable subrogation against its own insured. See Medina v. Herrera⁴, 927 S.W.2d 597, 604 (Tex.1996); see also McBroome-Bennett Plumbing, Inc., 515 S.W.2d at 36.

b. Application of Law to Facts

*4 The Insurer sued AU, its insured, on a theory of equitable subrogation to recover workers’ compensation insurance payments. Allowing a workers’ compensation insurer to maintain an equitable subrogation cause of action against its own insured would undermine the entire workers’ compensation system. We overrule the Insurer’s point of error with respect to its equitable subrogation claim. See Medina, 927 S.W.2d at 604.

2. Equitable Restitution

The Insurer contends that the trial court improperly granted summary judgment on its equitable restitution cause of action because AU’s summary judgment motion did not expressly plead for judgment on equitable restitution. Because AU’s motion for summary judgment alleges no grounds for summary judgment on equitable restitution, the motion is legally insufficient to support the summary judgment as a matter of law. See McConnell, 858 S.W.2d at 342. The trial court erred in granting summary judgment on the Insurer’s equitable restitution cause of action. We sustain the Insurer’s point of error with respect to its equitable restitution claim.

We affirm the trial court’s summary judgment for AU on the Insurer’s equitable subrogation cause of action. We reverse the trial court’s summary judgments for AU against Pitts and against the Insurer on its equitable restitution cause of action. We remand this cause for further proceedings consistent with this opinion.

	Footnotes
1		The Insurer abandoned its statutory subrogation claim in its First Amended Plea in Intervention.
2		Act of Dec. 13, 1989, 71st Leg., 2nd C.S., ch. 1, § 4.01, 1989 Tex. Gen. Laws 1, 32, repealed by Act. of Sept. 1, 1993, 73rd Leg., R.S., ch. 269, § 1, 1993 Tex. Gen. Laws 987, 1132-33 (current version at Tex.Lab.Code Ann. § 408.001(a) (Vernon Supp.1997)). All citations to the workers’ compensation act are to the applicable provisions in effect at the time Pitts suffered his on-the-job injury.
3		“For the purposes of workers’ compensation insurance coverage, a person who performs work or provides a service for a general contractor or motor carrier who is an employer under this Act is an employee of that general contractor or motor carrier, unless the person is operating as an independent contractor or is hired to perform the work or provide the service as an employee of a person operating as an independent contractor.” Tex.Rev.Civ.Stat.Ann. art. 8308-3.05(b).
4		The Medina court concluded that allowing a workers’ compensation insurer to sue its own insured for equitable subrogation to recoup amounts paid under a policy created a conflict that would work to the “overall detriment” of the workers’ compensation system. Medina, 927 S.W.2d at 604.