Court of Appeals of Texas,

Houston (14th Dist.).

Thomas M. HUDSON, Appellant,

v.

HOUSTON LIGHTING & POWER COMPANY, Appellee.

No. A14-93-00544-CV.

|

March 17, 1994.

Before J. CURTISS BROWN, C.J., MURPHY and ELLIS, JJ.

MURPHY, Justice.

OPINION

*1 In this appeal from a summary judgment granted in favor of appellee Houston Lighting & Power Company (“HL & P”), we are presented with the question of whether enforcement of a clause in appellee’s disability plan constituted an illegal taking of appellant’s worker’s compensation benefits, or discrimination against appellant for filing a workers’ compensation claim. We hold that it does not, and affirm.

Appellant was employed as a meter reader by appellee. Like all HL & P employees, appellant was covered by private disability insurance through the Long Term Disability Plan of the company (“the Plan”). For employees who contributed to the Plan, the Plan provided for disability income of 60% of the employee’s monthly earnings, up to a maximum amount per month of $4,000.¹ The Plan also provided for an offset of these private disability benefits:

5.6 Reduction of Supplemental Disability Income by Other Income Benefits : Any monthly amount of Supplemental Disability Income benefit payable to an Employee under Section 5.3 hereof shall be reduced by other income benefits to which such Employee may be entitled, and which are payable on or after the commencement of the Total Disability for which benefits hereunder are payable. Such Other Income Benefits include the following:

…

(e) One-half of benefits payable under any workmen’s compensation or similar law; …

For purposes of determining the benefit payable under this Plan, any Other Income Benefits payable to an Employee in a lump sum or on any basis other than a monthly basis will be converted to a monthly equivalent.

On January 29, 1988, while jumping over a fence to read a meter, appellant injured his knee. In June of 1989, appellee approved the payment of long term disability benefits to appellant pursuant to the Plan. Because of his injury, appellant was unable to return to work as a meter reader, but appellee retained him in the position of records clerk, effective August 14, 1989. The new job was a desk job, and had a lower salary than appellant’s previous position with the company. Meanwhile, appellant filed for workers’ compensation benefits, and secured a lump sum settlement in the amount of $15,250.00, plus other future medical benefits. On November 15, 1989, appellee informed appellant that under the terms of the Plan, the benefits paid him under the Plan would be reduced by 50% of the amount of his workers’ compensation settlement, or $7,625.00. That amount would be converted to a monthly equivalent, and would result in a reduction of his monthly disability benefit payment for eighteen months.

Appellant brought suit against appellee on November 15, 1991. He first claimed that appellee had unlawfully taken half of the settlement of his workers’ compensation claim in violation of former TEX. REV. CIV. STAT. ANN. art. 8306 § 3(b).² In addition, he claimed that as retaliation for his filing for workers’ compensation benefits, appellee had discriminated against him in violation of former TEX. REV. CIV. STAT. ANN. art. 8307c.³ Appellee moved for summary judgment on three grounds:

*2 (1) that appellee did not violate Article 8306, § 3(b), because appellant’s long term disability benefits had been reduced in accordance with the terms of the Plan, a private agreement between HL & P and its employees; (2) that any complaint regarding the change in appellant’s job status was barred by the statute of limitations; and (3) that appellee did not violate Article 8307c because appellant was never terminated from employment, and because appellant was satisfied with his job as a records clerk. Appellant responded to appellee’s Motion for Summary Judgment, and again alleged that appellee violated Article 8306, § 3(b) and Article 8307c by reducing his disability benefits, and argued that the statute of limitations did not bar his claim that appellee discriminated against him by reducing his benefits. The trial court, without specifying the grounds on which it was relying, granted summary judgment in favor of appellee.

In four points of error, appellant attacks the summary judgment, claiming (1) because appellee admits the conduct complained of by appellant but denies that it violates the statutory provisions, this creates a material issue of fact; (2) the statute of limitations does not bar appellant’s discrimination claim based on the reduction of benefits; and (3) appellee’s contention that appellant is satisfied with his current position is legally insufficient to support a summary judgment on the discrimination claim.

The standard to be followed in review of a summary judgment is well established:

1. The movant for summary judgment has the burden of showing that there is no genuine issue of material fact and that he is entitled to judgment as a matter of law.

2. In deciding whether or not there is a disputed material fact issue precluding summary judgment, evidence favorable to the non-movant will be taken as true.

3. Every reasonable inference must be indulged in favor of the non-movant and any doubts resolved in her favor.

Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 (Tex. 1985). Montgomery v. Kennedy, 669 S.W.2d 309, 310-11 (Tex. 1984). A defendant who moves for summary judgment has the burden of showing as a matter of law that no material issue of fact exists on one or more elements of the plaintiff’s cause of action. Black v. Victoria Lloyds Ins. Co., 797 S.W.2d 20, 27 (Tex. 1990); Arnold v. National County Mut. Fire Ins. Co., 725 S.W.2d 165, 166-67 (Tex. 1987). A summary judgment for the defendant disposing of the entire case is proper only if, as a matter of law, plaintiff could not succeed upon any theory pled. Delgado v. Burns, 656 S.W.2d 428, 429 (Tex. 1983). However, when a summary judgment does not specify the grounds upon which the trial court granted it, the reviewing court will affirm the judgment if any one of the theories advanced in the motion is meritorious. Carr v. Brasher, 776 S.W.2d 567, 569 (Tex. 1989).

Appellant alleges that appellee’s reduction of his long term disability benefits by half of the amount of his settlement violated former Article 8306, § 3(b), which prohibits garnishment, attachment, and assignment of workers’ compensation benefits. We find that the reduction of disability benefits does not represent a “taking” of the workers’ compensation benefits, as appellant alleges. Appellant has received his workers’ compensation benefits in full. The disability benefits paid by the company are an entirely separate matter. In fact, if appellant had been injured apart from work, he would have received full disability benefits through the Plan even though he would be ineligible for workers’ compensation. Private disability benefits are in the nature of a gratuity conferred on employees, see Western Casualty Co. v. Hunt, 69 F.2d 129, 130 (5th Cir.), cert. granted, 293 U.S. 537, and cert. dism’d, 293 U.S. 530 (1934), and the company was not obligated to provide appellant with disability benefits. Moreover, appellant’s contention that the Plan’s offset provision violates Article 8306, § 3(b) is not in accordance with Texas law.

*3 The Texas Supreme Court has stated that if an insurance company plainly and unambiguously provides for offset in the insurance contract, the company may deduct benefits such as workers’ compensation payments from private disability benefits. Barnett v. Aetna Life Ins. Co., 723 S.W.2d 663, 667 (Tex. 1987). See also Capps v. American Mut. Liab. Ins. Co., 601 S.W.2d 816 (Tex. Civ. App.-Dallas 1980, no writ) (allowing disability insurance carrier to deduct amount of both workers’ compensation and social security benefits from monthly disability benefits pursuant to insurance contract). Such a provision does not violate Article 8306, § 3(b). Smith v. Ethyl Corp., 417 F.Supp. 669, 674-75 (S.D. Tex. 1976); Dean v. Safety Casualty Co., 190 S.W.2d 750, 754 (Tex. Civ. App.-Fort Worth 1945, writ ref’d w.o.m.).

Appellee unambiguously provided in the Plan that disability benefits would be reduced by half of the amount of workers’ compensation benefits. This was permissible under Texas law, and we find that appellee did not violate Article 8306, § 3(b) by reducing appellant’s disability payments in accordance with the terms of the Plan.

Appellant also alleges that in reducing his disability payments, appellee discriminated against him in violation of Article 8307c, which prohibits discharging or in any other manner discriminating against an employee because the employee has filed a workers’ compensation claim. In accordance with our reasoning above, we find that the reduction of appellant’s disability payments did not constitute discrimination against him for filing a workers’ compensation claim. The reduction of benefits was a clause included in a private contract between HL & P and its employees. Appellant was not singled out for a reduction of benefits; this was a condition to which all employees, including appellant, who wished to participate in the Plan were subject. An employee who wished to contribute to the Plan and receive disability payments of 60% of his income also agreed that if he received other income benefits, the company could reduce his disability benefits by that amount. Appellant ratified the contract with appellee by contributing to the Plan, and accepting the benefits of the Plan. See Wetzel v. Sullivan, King & Sabom, P.C., 745 S.W.2d 78, 81 (Tex. App.-Houston [1st Dist.] 1988, no writ). Therefore, he also agreed to the limitations of the Plan. Further, deducting other income benefits from private disability insurance payments is not against public policy. Voss v. Mutual of Omaha Ins. Co., 469 S.W.2d 602, 604 (Tex. Civ. App.-San Antonio 1971, writ ref’d). Therefore, we find that appellee did not violate Article 8307c by reducing appellant’s disability benefits. Appellant’s first and second points of error are overruled.

Appellant’s third point of error asserts that his claim for discrimination based on the reduction of benefits is not barred by the statute of limitations. However, appellant’s assertion is irrelevant in light of our finding that as a matter of law appellant has no claim for discrimination based on the reduction of benefits. Therefore, we do not need to address appellant’s third point of error.

*4 In its motion for summary judgment, appellee also asserted that appellant’s discrimination claim based on his change in job status was barred by the statute of limitations. In his response to appellee’s motion, appellant did not address this assertion. However, in his fourth point of error, appellant argues that his alleged job satisfaction is a legally insufficient reason to support summary judgment on his job status discrimination claim under Article 8307c.

It is undisputed that appellant was assigned the lower-paying position in August, 1989, and filed suit for discrimination on November 15, 1991, more than two years later. The statute of limitations for discrimination claims under Article 8307c is two years. See TEX. CIV. PRAC. & REM. CODE ANN. § 16.003 (Vernon 1986); Luna v. Frito Lay, Inc., 726 S.W.2d 624, 628 (Tex. App.-Amarillo 1987, no writ). Therefore, appellant’s claim for discrimination because of his change in job status is barred by the statute of limitations. Because we have found a meritorious reason on which the trial court could have based its granting of summary judgment on this issue, and the trial court did not specify the grounds upon which it granted the motion, we decline to address appellant’s fourth point of error. Carr v. Brasher, 776 S.W.2d 567, 569 (Tex. 1989).

The result of our findings that appellee did not violate Articles 8306, § 3(b) and 8307c, and that his job status discrimination claim is barred by the statute of limitations is that as a matter of law, appellant could not succeed on any theory he pled. Therefore, we hold that summary judgment for appellee was proper. The judgment of the trial court is affirmed.

	Footnotes
1		Non-contributing employees could receive 10% of their monthly income, up to a $400 maximum per month.
2		Repealed and reenacted as TEX. REV. CIV. STAT. ANN. art. 8308-4.07 by Acts 1989, 71st Leg., 2d C.S., ch. 1, §§ 4.07 and 16.01(7), effective January 1, 1991, repealed by Acts 1993, 73rd Leg., ch. 269, § 5(2), effective September 1, 1993 (current We note that at the time appellant brought suit under article 8306, § 3(b), it had already been repealed. However, the Texas Legislature included a savings clause in its repeal of the statute. This clause provided that the new law applied only to injuries which occurred on or after the effective date of the Act, and the old law would continue in effect to cover prior injuries. Acts 1989, 71st Leg., 2d C.S., ch. 1, § 17.18(c), effective January 1, 1991.
3		Repealed by Acts 1993, 73rd Leg., ch. 269, § 5(1), effective 451.001 (Vernon Supp. 1994)).