Court of Appeals of Texas,

El Paso.

Mark A. DURST, Appellant/Cross-Appellee,

v.

TRAVELERS PROPERTY CASUALTY, Appellee/Cross-Appellant.

No. 08-01-00028-CV.

|

May 23, 2002.

OPINION

RICHARD BARAJAS, Chief Justice.

*1 This is an appeal from a summary judgment. For the reasons stated, we reverse and render.

I. SUMMARY OF THE EVIDENCE

A. Factual Background

In October 1997, Appellant/Cross-Appellee, Mark A. Durst (“Durst”), was injured at work. He initially consulted the company doctor, who diagnosed his injury as a sprain and suggested he be placed on light duty. Durst consulted another physician, Dr. C.L. Rogers, who diagnosed the injuries as grade II shoulder, elbow, and wrist sprains. Dr. Rogers concluded that Durst was not able to return to work. As a result of his injury, Durst applied for and received workers’ compensation benefits. Appellee/Cross-Appellant, Travelers Property Casualty (“Travelers”), as Durst’s employer’s insurance carrier, began making payments to Durst on November 26, 1997, and continued making payments through April 26, 2000.

In May 1998, while still under treatment for his work-related injuries, Durst was involved in an automobile accident. He suffered a fractured humerus and remained in the hospital for three weeks after the accident. Durst did not return to work due to continuing pain from his initial, work-related injuries.

B. Procedural Background

In August 1998, Durst sued Donna Arnold and Arnold Trucking and Material Company (collectively, “the Arnolds”) for the injuries he sustained in the automobile accident. Travelers intervened in the lawsuit, alleging a right under the subrogation provisions of the Workers’ Compensation Act to funds paid to Durst after the accident.

On November 29, 1999, the Texas Workers’ Compensation Commission (“the Commission”) held a benefit contested case hearing to decide if the compensable injury sustained by Durst included an injury to the cervical area. The Commission found that the compensable injury suffered by Durst in October 1997, included an injury to the cervical area and ordered Travelers to continue paying medical and income benefits.

In December 1999, Travelers, Durst, and the Arnolds entered a Compromise Settlement and Indemnification Agreement. The Arnolds agreed to pay Durst $165,000, and Durst agreed to release all claims against the Arnolds and dismiss them from the lawsuit. The trial court dismissed all claims against the Arnolds in January 2000. Durst then moved for summary judgment against Travelers, alleging that Travelers had no right to any of the amounts in controversy because Durst’s injuries were not the result of a work-related accident. Travelers also moved for summary judgment, claiming that the subrogation provisions of the Act granted it the right to recover benefits paid to Durst and a credit against future benefits from the settlement in order to avoid a double recovery to Durst. The trial court granted Travelers’ motion and denied Durst’s motion.

Before final judgment was entered, the parties stipulated the following:

• Durst and Travelers settled with the Arnolds for $165,000;

• Durst’s attorney’s fees amounted to $55,000 of the total settlement;

*2 • Durst incurred a total of $5,887.75 in taxable court costs and litigation expenses in prosecuting the suit against the Arnolds through the date of settlement;

• Travelers incurred a total of $641.11 in taxable court costs and litigation expenses in prosecuting the suit against the Arnolds through the date of settlement;

• After deduction of attorney’s fees and litigation expenses, Durst received $104,112.25 from the settlement;

• Durst paid Parkland Hospital $50,000 and Shannon Medical Center $794.50 from his settlement funds to satisfy hospital liens;

• $24,458.65 (plus interest) was being held in trust for Durst and Travelers pending resolution of Travelers claims;

• Travelers had paid Durst $20,606.75 in income benefits;

• Travelers had paid Durst $4,931.10 in impairment benefits; and

• Travelers had paid Durst $6,087.14 in medical or other compensation benefits.

The court entered judgment based on the parties’ stipulations, finding that one-third of the total workers’ compensation benefits of $31,624.99, or $10,541.66, should be assessed as attorney’s fees pursuant to Section 417.003(c) of the Act. The court allocated $7,166.34 of this amount to Durst’s attorneys and $3,375.32 to Traveler’s attorneys. The court also found that Travelers’ pro rata share of Durst’s attorney’s expenses was $1,128.48. It awarded Travelers and its attorneys $23,330.17, the amount remaining after deducting Durst’s attorney’s fees and litigation expenses, from the settlement funds being held in trust. Finally, the court granted Travelers a credit against future workers’ compensation benefits in the amount of $29,987.38. Both parties timely perfected appeals.

II. DISCUSSION

Durst presents four issues challenging the granting of summary judgment and the award of attorneys fees and costs. Travelers presents one issue challenging the award of attorneys fees. We begin with the summary judgment issues, followed by the attorney’s fee issue.

A. Summary Judgment Standard of Review

The standard of review on appeal is whether the successful movant at the trial level carried its burden of showing that there is no genuine issue of material fact and that a judgment should be granted as a matter of law. Lear Siegler, Inc. v. Perez, 819 S.W.2d 470, 471 (Tex.1991); Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548 (Tex.1985); Cortez v. Liberty Mut. Fire Ins. Co., 885 S.W.2d 466, 469 (Tex.App.-El Paso 1994, writ denied). Thus, the question on appeal is not whether the summary judgment proof raises fact issues as to required elements of the movant’s cause or claim, but whether the summary judgment proof establishes, as a matter of law, that there is no genuine issue of material fact as to one or more elements of the movant’s cause or claim. Gibbs v. General Motors, 450 S.W.2d 827, 828 (Tex.1970).

In resolving the issue of whether the movant has carried this burden, all evidence favorable to the non-movant must be taken as true and all reasonable inferences, including any doubts, must be resolved in the non-movant’s favor. See Nixon, 690 S.W.2d at 548-49; DeLuna v. Guynes Printing Co., 884 S.W.2d 206, 208 (Tex.App.-El Paso 1994, writ denied). When both parties move for summary judgment pursuant to Tex.R. Civ. P. 166a(c), each party must carry its own burden and neither can prevail due to the other’s failure to meet its burden. Farmer’s Texas County Mut. Ins. Co. v. Griffin, 868 S.W.2d 861, 863 (Tex.App.-Dallas 1993, writ denied). When both parties file summary judgment and one is granted and one is denied, we will review the evidence presented by both sides, determine all questions presented, and render the judgment the trial court should have rendered. Commissioners Court v. Agan, 940 S.W.2d 77, 81 (Tex.1997). Thus, on appeal, this Court considers all evidence accompanying both motions in determining which movant should prevail. Griffin, 868 S.W.2d at 863.

*3 In Issue No. One, Durst attacks the trial court’s granting of Travelers motion for summary judgment and denial of his motion for summary judgment because, as a matter of law, Travelers does not have subrogation rights in the recovery for a non-work-related injury. In Issue No. Two, Durst argues that the trial court erred in granting Travelers motion for summary judgment because Travelers failed to conclusively establish third party liability for a compensable injury for which it had paid benefits. In Issue No. Three, Durst asserts that the trial court erred in denying his motion for summary judgment because he conclusively established that he did not receive a compensable injury in the automobile accident. We agree.

Travelers’ subrogation rights are purely statutory. Johnson v. Second Injury Fund, 688 S.W.2d 107, 108 (Tex.1985). The statutes at issue provide:

417.001. Third Party Liability

a) An employee or legal beneficiary may seek damages from a third party who is or becomes liable to pay damages for an injury or death that is compensable under this subtitle and may also pursue a claim for workers’ compensation benefits under this subtitle.

(b) If a benefit is claimed by an injured employee or a legal beneficiary of the employee, the insurance carrier is subrogated to the rights of the injured employee and may enforce the liability of the third party in the name of the injured employee or the legal beneficiary. If the recovery is for an amount greater than that paid or assumed by the insurance carrier to the employee or the legal beneficiary, the insurance carrier shall:

(1) reimburse itself and pay the costs from the amount recovered; and

(2) pay the remainder of the amount recovered to the injured employee or the legal beneficiary.

…

417.002. Recovery in Third Party Action

(a) The net amount recovered by a claimant in a third-party action shall be used to reimburse the insurance carrier for benefits, including medical benefits, that have been paid for the compensable injury.

(b) Any amount recovered that exceeds the amount of the reimbursement required under Subsection (a) shall be treated as an advance against future benefits, including medical benefits, that the claimant is entitled to receive under this subtitle.

(c) If the advance under Subsection (b) is adequate to cover all future benefits, the insurance carrier is not required to resume the payment of benefits. If the advance is insufficient, the insurance carrier shall resume the payment of benefits when the advance is exhausted.

Tex. Lab.Code Ann. §§ 417.001, 417.002 (Vernon 1996 & Supp.2002).

When statutory language is clear and unambiguous, as in this case, a statute should be given its plain meaning. Employers Casualty Co. v. Dyess, 957 S.W.2d 884, 889 (Tex.App.-Amarillo 1997, writ denied). Thus, to prevail on summary judgment, Travelers had the burden to show (1) liability of a third party, (2) for a compensable injury, and (3) for which it had paid a specific amount of benefits.

*4 The plain language of the statute is that the insurance carrier has subrogation rights from the third party who caused the compensable injury for which it had paid benefits. Tex. Lab.Code Ann. §§ 417.001, 417.002 (Vernon 1996 & Supp.2002) (emphasis added). The statute defines a “compensable injury” as “an injury that arises out of and in the course and scope of employment for which compensation is payable under” the Act. Tex. Lab.Code Ann. § 401.011(10) (Vernon Supp.2002). While there may be circumstances under which subrogation would be permitted when aggravation of a work related injury has been established, the summary judgment evidence in this case established that the injury suffered by Durst in the collision was not work related and was not an aggravation of the work related injury. It was further shown that the only injury for which Durst was receiving compensation after the accident was an injury to his “cervical area.” The evidence established that the injury suffered by Durst in the accident was to his left arm. In his affidavit, Durst stated, “I did not injure my neck in the auto collision. The neck injury that I have was from the October 17, 1997, work incident.” There is nothing in the record before this Court that shows Durst injured his “cervical area” in the accident. While a CT scan of the cervical spine was performed after the accident, Durst’s treating physician since June, 1998, opined that the cervical injury was a result of the work-related injury, not the accident. The Commission noted this fact in its determination that the compensable injury suffered by Durst in October 1997, included an injury to the cervical area. Considering all of the summary judgment evidence, we find that Durst conclusively established that he did not receive a compensable injury in the automobile accident, that summary judgment in favor of Travelers was improper, and that summary judgment in favor of Durst should have been granted.¹ Issues No. One through Three are sustained.

B. Attorney’s Fees, Costs, and Credits

In Issue No. Four, Durst argues that the amount of credit the trial court awarded to Travelers is incorrect. In its sole Cross Issue, Travelers argues that the trial court erred in awarding a portion of Durst’s litigation expenses out of Travelers’ subrogation recovery pursuant to Section 417.003(c) of the Texas Workers’ Compensation Act because the Act does not permit payments of litigation expenses out of the insurance carrier’s subrogated recovery, where the attorney for the insurance carrier represented the carrier’s interest and participated in obtaining the subrogated recovery. Tex. Lab.Code Ann. § 417.003(c) (Vernon 1996).

Given our disposition of Issues No. One through Three, we need not address Issue No. Four or Travelers’ Cross-Issue. By finding that Travelers was not entitled to subrogation since Durst did not suffer a compensable injury, we hold that Travelers was not entitled to reimbursement and was not entitled to a credit against future workers’ compensation benefits.² See Tex. Lab.Code Ann. § 417.002 (Vernon 1996). Summary judgment in favor of Travelers was error.

*5 Having sustained Issues No. One through Three, we reverse the judgment of the trial court and render summary judgment in favor of Durst.

	Footnotes
1		We are not unmindful of Houston Gen. Ins. Co. v. Campbell, 964 S.W.2d 691 (Tex.App. Corpus Christi 1998, pet. denied), but we find it distinguishable.
2		Section 417.002 provides: (a) The net amount recovered by a claimant in a third-party action shall be used to reimburse the insurance carrier for benefits, including medical benefits, that have been paid for the compensable injury. (b) Any amount recovered that exceeds the amount of the reimbursement required under Subsection (a) shall be treated as an advance against future benefits, including medical benefits, that the claimant is entitled to receive under this subtitle. (c) If the advance under Subsection (b) is adequate to cover all future benefits, the insurance carrier is not required to resume the payment of benefits. If the advance is insufficient, the insurance carrier shall resume the payment of benefits when the advance is exhausted. Tex. Lab.Code Ann. § 417.002 (Vernon 1996).