Supreme Court of Texas.
SOUTHWESTERN BELL TELEPHONE COMPANY, L.P., d/b/a SBC Texas, Petitioner,
William C. MITCHELL, Beneficiary of Louise Mitchell, Decedent, Respondent.
Argued March 23, 2006.
Decided Dec. 19, 2008.
Rehearing Denied Feb. 27, 2009.
Attorneys & Firms
*444 Lawrence D. Smith, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., San Antonio, TX, for Petitioner.
Alan D. Tysinger, Miller & Tysinger, P.C., Kevin B. Miller, Law office of Miller & Bicklein, San Antonio, TX, for Respondent.
Robert D. Stokes, Flahive Ogden & Latson, Austin, TX, for Amici.
Justice WILLETT joined.
In section 409.021 to make clearer that a carrier who “fails to comply with Subsection (a) does not waive the ... right to contest the compensability of the injury”.5
Because the rule announced in Downs was in effect for only about a year, petitioner contends we should overrule that case as having been wrongly decided. We agree. We reverse the judgment of the court of appeals6 and remand the case to the trial court for further proceedings.
On August 14, 2000, Louise Mitchell, a clerk-typist for petitioner Southwestern Bell Telephone Company, was diagnosed with Legionnaire’s disease. Claiming to *445 have contracted the disease at work, Mitchell sent Bell a notice of injury, which Bell received on August 23. Mitchell died four days later, and her husband, respondent William Mitchell, claimed workers’ compensation death benefits. On October 5, 43 days after receiving notice of injury, Bell, a self-insured nonsubscriber, contested compensability in a filing with the Commission.
At the time, section 409.021(a) of the Texas Labor Code stated:
An insurance carrier shall initiate compensation ... promptly. Not later than the seventh day after the date on which an insurance carrier receives written notice of an injury, the insurance carrier shall:
(1) begin the payment of benefits as required by this subtitle; or
(2) notify the commission and the employee in writing of its refusal to pay and advise the employee of:
(A) the right to request a benefit review conference; and
(B) the means to obtain additional information from the commission.7
Earlier in the year, on January 26, the court of appeals had issued its opinion in section 409.021(c), which stated:
(c) If an insurance carrier does not contest the compensability of an injury on or before the 60th day after the date on which the insurance carrier is notified of the injury, the insurance carrier waives its right to contest compensability. The initiation of payments by an insurance carrier does not affect the right of the insurance carrier to continue to investigate or deny the compensability of an injury during the 60–day period.10
After the court of appeals’ Downs decision, the Commission adhered to its position, adopting rules in March that reflected its construction of the statute.11 On August 16, the court granted rehearing and issued *446 a substitute opinion reaching the same result,12 and twelve days later the Commission’s executive director issued the following advisory:
After consultation with the Office of the Attorney General ..., the Commission understands that the August 16th decision in the 132.17, remain in effect.13
For the Mitchell claim, Downs was final and stating that “[a]ll previous Advisories issued by the Commission regarding this issue are superseded by this Advisory and the Supreme Court decision.”16
The Mitchell proceeding then resumed. A contested case hearing was held in March 2003, the focus of which was, according to the hearing officer, “where the bacteria [legionella pneumophilia] was contracted, that is, at work, or somewhere else.” Based on medical evidence that “the bacteria is everywhere in the environment and because no other co-workers, including those at high risk, contracted the disease”, the hearing officer concluded that Mitchell’s husband had failed to prove that Mitchell contracted her illness in the course and scope of employment, finding instead that “[t]he Downs should not be applied retroactively and concluded that by failing to pay benefits or give notice of its refusal to do so within seven days of notice of Mitchell’s injury, Bell was precluded from contesting compensability. Consequently, the hearing officer awarded death benefits to Mitchell’s husband. Bell filed an administrative appeal.
*447 On May 28, 2003, about nine months after section 409.021 to make clearer that the rule the Commission had long applied was the rule that the Legislature believed should be followed. The amendment added the following paragraph (a–1):
An insurance carrier that fails to comply with Subsection (a) does not waive the carrier’s right to contest the compensability of the injury as provided by Subsection (c) but commits an administrative violation subject to Subsection (e).17
On May 29, the day after the amendments to Downs should apply retroactively to injuries occurring before the Court’s decision was final. Bell sought review in the district court, which, though of the view that this Court “may ... very well [have] been wrong in Downs”, granted summary judgment for Mitchell’s husband. The court of appeals affirmed.18
We granted Bell’s petition for review.19
Bell, supported by several amici curiae,20 argues that we should overrule Downs. We agree.
“Generally, the doctrine of stare decisis dictates that once the Supreme Court announces a proposition of law, the decision is considered binding precedent”,21 but we have long recognized that the doctrine is not absolute. “[W]e adhere to our precedents for reasons of efficiency, fairness, and legitimacy”,22 and “when adherence to a judicially-created rule of law no longer furthers these interests, and ‘the general interest will suffer less by such departure, than from a strict adherence,’ we should not hesitate to depart from a prior holding.”23 “[U]pon no sound principle do we feel at liberty to perpetuate an error, into which either our predecessors or ourselves may have unadvisedly fallen, merely upon the ground of such erroneous decision having been previously rendered.”24
We have observed that “in the area of statutory construction, the doctrine of stare decisis has its greatest force”25 because the Legislature can rectify a court’s mistake, and if the Legislature does not do so, there is little reason for the court to reconsider whether its decision was correct. But when the Legislature does not acquiesce in the court’s construction, when instead it immediately makes *448 clear that the proper construction is one long adopted by the agency charged with enforcing the statute, judicial adherence to the decision in the name of stare decisis may actually disserve the interests of “efficiency, fairness, and legitimacy” that support the doctrine. It is hardly fair or efficient to give effect to a judicial construction of a statute for a brief period of time when the Legislature has reinstated for future cases the same rule that had been followed before the court’s decision. The doctrine of stare decisis does not justify inequity and confusion in such a narrow gap of time.
That is precisely the situation here. In section 409.021, stating:
An insurance carrier that fails to comply with Subsection (a) does not waive the carrier’s right to contest the compensability of the injury as provided by Subsection (c) but commits an administrative violation subject to Subsection (e).27
The effect of the amendment was to restore the rule the Texas Workers’ Compensation Commission had applied for a decade.
Thus, Downs gap. Stare decisis does not warrant an obstinate insistence on precedent that appears to be plainly incorrect.
We believe, as the dissent does, that finality is an important consideration in statutory construction, and that an appellate court’s decisions should not change merely because the judges have changed. But while we think Downs can easily be remedied without violating the principles of stare decisis. The case is overruled.
Accordingly, we reverse the judgment of the court of appeals and remand the case to the trial court for further proceedings.
NATHAN L. HECHT, Justice.
Chief Justice MEDINA joined.
Justice GREEN took no part in the decision of the case.
Chief Justice MEDINA, dissenting.
As I noted in dissent six years ago, I believe Marbury v. Madison, 5 U.S. (1 Cranch) 137, 178, 2 L.Ed. 60 (1803), that the Court ultimately declares the law’s meaning.
Downs, and because I would not apply Downs prospectively only, I respectfully dissent.
Stare decisis has its greatest force in cases involving statutory construction. Weiner v. Wasson, 900 S.W.2d 316, 320 (Tex.1995)(noting that “if we did not follow our own decisions, no issue could ever be resolved” and cautioning that “[t]he potential volume of speculative relitigation under such circumstances alone ought to persuade us that stare decisis is a sound policy”).
Storage & Processors, Inc. v. Reyes, 134 S.W.3d 190, 192 (Tex.2004) (noting that “[a]lthough the Legislature ten weeks later amended the Labor Code to prohibit pre-injury waivers, Lawrence remains the law for those claims, like Reyes’, brought by workers who both signed non-subscriber agreements and suffered injury before [the amendment]”).
Legislatures write statutes; courts construe them. Cf. THE FEDERALIST NO. 78, at 466 (Alexander Hamilton) (Clinton Rossiter ed., 1961)(“The interpretation of the laws is the proper and peculiar province of the courts.”). We did so in Weiner. We should not abandon stare decisis principles here.
Nor would I hold, as Bell urges, that Carrollton–Farmers Branch Indep. Sch. Dist. v. Edgewood Ind. Sch. Dist., 826 S.W.2d 489, 518–21 (Tex.1992).
Since our adoption of the Chevron Oil test, however, the Supreme Court explicitly overruled it as it applies to constitutional decisions and suggested that prospective application was not only wrong as to constitutional decisions, but contrary to the role of the judiciary. The Court stated:
*451 When this Court applies a rule of federal law to the parties before it, that rule is the controlling interpretation of federal law and must be given full retroactive effect in all cases still open on direct review and as to all events, regardless of whether such events predate or postdate our announcement of the rule.... [W]e can scarcely permit the substantive law [to] shift and spring according to the particular equities of [individual parties’] claims of actual reliance on an old rule and of harm from a retroactive application of the new rule.
Hulin v. Fibreboard Corp., 178 F.3d 316, 333 (5th Cir.1999) (noting that the Supreme Court has “substantially reject[ed] ... departures [from the retroactivity doctrine] and return[ed] to the general rule of adjudicative retroactivity, leaving only an indistinct possibility of the application of pure prospectivity in an extremely unusual and unforeseeable case.”).
Even if Rivers v. Roadway Express, Inc., 511 U.S. 298, 313, 114 S.Ct. 1510, 128 L.Ed.2d 274 (1994) (“[The Legislature] may even, within broad constitutional bounds, make such a change retroactive and thereby undo what it perceives to be the undesirable past consequences of what it perceives to be a misinterpretation of its work product. No such change, however, has the force of law unless it is implemented through legislation.”). In this case, the Legislature was clear:
This Act takes effect September 1, 2003, and applies only to a claim for workers’ compensation benefits based on a compensable injury that occurs on or after that date. A claim based on a compensable injury that occurs before the effective date of this Act is governed by the law in effect on the date the compensable injury occurred, and the former law is continued in effect for that purpose.
Act of May 28, 2003, 78th Leg., R. S., ch. 1100, § 2, 2003 Tex. Gen. Laws 3161, 3162 (emphasis added). Thus, the Legislature chose not to disrupt the law in effect prior to September 1, 2003—the law as interpreted by this Court in Lasater v. Lopez, 110 Tex. 179, 217 S.W. 373, 376–77 (1919) (Courts “violate their true powers and endanger their own authority whenever they undertake the legislative role[.]”).
*452 “It is not the duty of the court to write the laws of our state, but the proper function of the courts is to enforce the laws as made by the Legislature.” Downs not be given retroactive effect.
The Court holds today that, “without violating the principles of stare decisis,” it may overturn very recent precedent construing a statute. Ironically, those principles counsel just the opposite. When we observe the time-honored tradition of adherence to precedent, particularly in statutory cases, the democratic process generally works as intended. It worked here. The Court declared the law in Downs holding nevertheless bound all litigants. It should also bind the Court. It was entirely appropriate, of course, for a subsequent Legislature to revise the statute. But the fact that the Legislature changed the law does not alter its former validity. Otherwise, the force of any prior decision in which we have determined statutory meaning is subject to change, threatening the law’s stability. I would affirm the court of appeals’ judgment.
Act of December 12, 1989, 71st Leg., 2d C.S., ch. 1, § 5.21, 1989 Tex. Gen. Laws 1, 51 (effective Jan. 1, 1991) (formerly TEX. LABOR CODE §§ 409.021–.022.
81 S.W.3d 803, 804, 807 (Tex.2002).
The Commission was created in 1989 to replace the Industrial Accident Board, and was abolished effective September 1, 2005, with its functions transferred to a new division of the Texas Department of Insurance. Act of December 12, 1989, 71st Leg., 2d C.S., ch. 1, §§ 2.01–.09, 17.01, 1989 Tex. Gen. Laws at 7, 115 (see former TEX.REV.CIV. STAT. ANN. art. 8308–2.01 et seq., codified in 1993 as Chapter 402 of the Texas Labor Code); Act of May 29, 2005, 79th Leg., R.S., ch. 265, §§ 1.003, 8.001, 2005 Tex. Gen. Laws 469, 470, 607–608.
Downs, 81 S.W.3d at 809 (Jefferson, J., dissenting) (citing cases).
Act of May 28, 2003, 78th Leg., R.S., ch. 1100, § 1, 2003 Tex. Gen. Laws 3161, 3162 [H.B. 2199].
276 S.W.3d 452 (Tex.App.–San Antonio 2005) (mem. op.).
Act of May 12, 1993, 73d Leg., R.S., ch. 269, § 1, 1993 Tex. Gen. Laws 987, 1195, codifying Act of December 12, 1989, 71st Leg., 2d C.S., ch. 1, § 5.21(a) (in part), (b), 1989 Tex. Gen. Laws 1, 51 (effective Jan. 1, 1991) (formerly TEX.REV.CIV. STAT. ANN. art. 8308–5.21).
TEX.REV.CIV. STAT. ANN. art. 8308–5.21(a)–(b)).
See Tex. Workers’ Comp. Comm’n, Appeal No. 92122, 1992 WL 358230, at *6 (May 4, 1992).
TEX. LABOR CODE § 409.021(c).
25 Tex. Reg. 2101 (Mar. 10, 2000) (adopting new Rule 124.3, 28 Tex. Admin. Code § 132.17 (2000)).
81 S.W.3d 803 (Tex.2002).
Tex. Workers’ Comp. Advisory 2000–07 (Aug. 28, 2000), http:// www. tdi.state.tx.us/wc/news/advisories/ad2000–07.html.
Tex. Workers’ Comp. Advisory 2002–08 (June 17, 2002), http:// www. tdi.state.tx.us/wc/news/advisories/ad2002–08.html.
Tex. Workers’ Comp. Comm’n, Appeal No. 021635, 2002 WL 1981340, at *2–3 (July 31, 2002), http://www.tdi.state.tx.us/appeals/2002 cases/021635r. pdf.
Tex. Workers’ Comp. Advisory 2002–15 (Sept. 12, 2002), http:// www. tdi.state.tx.us/wc/news/advisories/ad2002–15.html.
Act of May 28, 2003, 78th Leg., R.S., ch. 1100, § 1, 2003 Tex. Gen. Laws 3161, 3162.
276 S.W.3d 452, 455 (Tex.App.–San Antonio 2005) (mem. op.).
49 Tex. S.Ct. J. 360 (Feb. 24, 2006).
Texas Municipal League—Intergovernment Risk Pool, Texas Association of Business, Texas Association of School Boards, Insurance Council of Texas, Texas Mutual Insurance Co., and Edwards Risk Management, Inc.
Lubbock County v. Trammel’s Lubbock Bail Bonds, 80 S.W.3d 580, 585 (Tex.2002).
Weiner v. Wasson, 900 S.W.2d 316, 320 (Tex.1995).
Benavides v. Garcia, 290 S.W. 739, 740 (Tex. Comm’n App.1927, judgm’t adopted)).
Willis v. Owen, 43 Tex. 41, 48–49 (1875).
United States v. South Buffalo Ry., 333 U.S. 771, 774–775, 68 S.Ct. 868, 92 L.Ed. 1077 (1948)).
Continental Cas. Co. v. Downs, 81 S.W.3d 803, 804, 807 (Tex.2002).
Tex. H.B. 2199, 78th Leg., R.S. (2003) (committee substitute); TEX. LAB.CODE § 409.021(a–1).