This appeal arises pursuant to the Texas Workers' Compensation Act, TEX. LAB. CODE ANN. § 401.001 et seq. (1989 Act). A contested case hearing was held on May 5, 2005. The hearing officer resolved the disputed issues by deciding that attorney’s fees in an amount not to exceed 25% of $295.32 per week are to be awarded to the appellant’s (claimant) attorney as long as income benefits are owed and until the total amount of attorney’s fees are paid; that the court-ordered child support is to be paid by the respondent (carrier) to the Child Support Division of the Attorney General’s Office in a weekly amount equal to one-half of what remains after attorney’s fees are paid from the claimant’s income benefits until child support obligations are discharged; and that “[b]enefits withheld in an amount in excess of the amount established in Conclusion of Law No. 4 are to be repaid to the claimant by the carrier.” The claimant appealed, disputing the determination that court-ordered child support is to be paid by the carrier in an amount equal to one-half of what remains after attorney fees are paid from the claimant’s income benefits. The carrier responded, urging affirmance of the disputed determination.

DECISION

The hearing officer’s decision and order is void due to lack of subject matter jurisdiction.

The amount of the claimant’s average weekly wage was undisputed. Further, the amount of the weekly temporary income benefits (TIBs) rate for the claimant was also undisputed. The evidence reflected that the claimant was under four separate court orders to pay child support. The claimant also owed attorney’s fees to his attorney for legal representation received in the workers’ compensation matter.

Section 158.009 of the Texas Family Code provides that an order or writ of withholding of income for child support shall direct any employer of the obligor to withhold from the obligor’s disposable earnings the amount specified up to a maximum amount of 50% of the obligor’s disposable earnings. The parties disagreed over the amount of TIBs that should be distributed to the claimant after amounts had been withheld for child support and attorney’s fees. It was the claimant’s position that the claimant should receive one-half of the total TIBs amount prior to any deduction for attorney’s fees. The carrier contended that attorney’s fees should be deducted from TIBs and then one-half of the TIBs amount remaining should be distributed to the claimant and one-half withheld for payment of child support.

In the Background Information portion of the decision the hearing officer referenced Section 408.203 which establishes a priority for allowable liens against income benefits. The first priority is attorney’s fees followed by court-ordered child support. The hearing officer noted that this conflicts with Section 158.0051(b) of the Texas Family Code which provides that an order for attorney’s fees and costs resulting from an action to enforce child support is subordinate to an order or writ of withholding for child support and is subject to the maximum amount allowed to be withheld under Section 158.009. Section 158.008 of the Texas Family Code provides a direct conflict with Section 408.203 of the Texas Labor Code. Section 158.008 provides that an order or writ of withholding has priority over any garnishment, attachment, execution, or other assignment or order affecting disposable earnings. The Texas Family Code in Section 101.010 defines disposable earnings. The claimant argues that the legal question presented in this case is “what are disposable earnings.” As previously noted, the Texas Family Code limits the amount to be withheld for child support to 50% of the obligor’s disposable earnings.

The parties are in effect arguing over how to apply the order of withholding for child support. This is not an area that has been committed to the Texas Workers’ Compensation Commission’s (Commission) discretion by statute. Subject matter jurisdiction is essential to the authority of a tribunal to decide a case and cannot be conferred by consent, waiver, or estoppel at any stage of a proceeding. See Tex. Ass’n. of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 443, 36 Tex. Sup. Ct. J. 607 (Tex. 1993). Subject matter jurisdiction is never presumed. Cont’l Coffee Prods. Co. v. Cazarez, 937 S.W.2d 444, 448, 40 Tex. Sup. Ct. J. 172 (Tex. 1996). Administrative agencies are created by statute and have no inherent authority. Pub. Util. Comm’n v. GTE-Southwest, Inc., 901 S.W.2d 401, 406, 38 Tex. Sup. Ct. J. 485 (Tex. 1995). Agencies may only exercise those specific powers that the law confers in clear and express language; however, an agency may also exercise powers necessarily implied from the statutory authority granted or the duties expressly given or imposed. Id. at 407. The “jurisdiction” of an administrative agency means the power to hear and determine a matter committed to the agency’s discretion by statute. Beaver Express Service, Inc. v. Railroad Commission of Texas, 727 S.W.2d 768 (Tex. App.-Austin 1987, writ denied). Section 155.001 of the Texas Family Code provides that except for the stated exceptions, a court acquires, continuing, exclusive jurisdiction over the matters provided for in a suit affecting a parent-child relationship, which include the order for child support, in connection with a child on the rendition of a final order. The stated exceptions include a voluntary or involuntary dismissal of a suit affecting parent-child relationship; a suit to determine parentage; a final order of adoption; and no other court has jurisdiction with regard to that child except as provided by Chapter 262 of the Family Code. The various district courts involved in this matter, have already exercised jurisdiction by ordering child support to be paid by the claimant. Those courts under Section 155.001 retain continuing, exclusive jurisdiction. The Commission does not have jurisdiction to interpret the various provisions of the Family Code or to determine the amount of the disposable earnings of the claimant subject to the withholding orders. This is a matter for the appropriate courts to decide.

Because the Commission lacks jurisdiction the hearing officer’s determinations that attorney’s fees in an amount not to exceed 25% of $295.32 per week are to be awarded to the claimant’s attorney as long as income benefits are owed and until the total amount of attorney’s fees are paid; that the court-ordered child support is to be paid by the carrier to the Child Support Division of the Attorney General’s Office in a weekly amount equal to one-half of what remains after attorney’s fees are paid from the claimant’s income benefits until child support obligations are discharged; and that the benefits withheld in an amount in excess of the amount established in Conclusion of Law No. 4 are to be repaid to the claimant by the carrier are void.

The true corporate name of the insurance carrier is HARTFORD UNDERWRITERS INSURANCE COMPANY and the name and address of its registered agent for service of process is

CT CORPORATION SYSTEM

350 NORTH ST. PAUL STREET

DALLAS, TEXAS 75201.

Margaret L. Turner

CONCUR:

Thomas A. Knapp
Appeals Judge

Robert W. Potts
Appeals Judge

This appeal arises pursuant to the Texas Workers' Compensation Act, TEX. LAB. CODE ANN. § 401.001 et seq. (1989 Act). A contested case hearing was held on May 14, 2004. The hearing officer resolved the disputed issues by determining that the appellant’s (claimant) _______________, compensable injury does not include hypertension, inflammation of the sternum, sleep apnea, fibromyalgia/connective tissue disorder, post-traumatic stress disorder, and headaches, and that the claimant has not exhausted the advance from the third party action requiring the respondent (carrier) to resume payment of benefits pursuant to Section 417.002(c). The claimant appeals these determinations and attaches numerous documents to her appeal, some of which were not offered into evidence at the hearing. The carrier responds, urging that the new evidence should not be considered on appeal and that the hearing officer’s decision should be affirmed.

DECISION

Affirmed.

The claimant attached new evidence to her appeal, some of which was not offered into evidence at the hearing. Documents submitted for the first time on appeal are generally not considered unless they constitute newly discovered evidence. Texas Workers' Compensation Commission Appeal No. 93111, decided March 29, 1993; Black v. Wills, 758 S.W.2d 809 (Tex. App.-Dallas 1988, no writ). Upon our review, the evidence offered is not so material that it would probably produce a different result. The evidence, therefore, does not meet the requirements for newly discovered evidence and will not be considered on appeal.

With regard to Dr. W report specifically, the claimant offered this evidence at the hearing, but the hearing officer excluded it on the basis that it had not been timely exchanged with the carrier and the claimant did not have good cause for failing to timely exchange it. We perceive no error in the hearing officer’s application of the exchange rules. We decline to consider Dr. W’s report on appeal.

The claimant expresses disagreement with the hearing officer’s rendition of the facts of the case contained in the Background Information section of the decision and the fact that the hearing officer did not discuss all of the evidence in the case in this section. Section 410.168 and Tex. W.C. Comm’n, 28 TEX. ADMIN. CODE § 142.16(a) (Rule 142.16(a)) require only that the hearing officer make findings of fact, conclusions of law, determine whether benefits are due, and award benefits. A statement of evidence as presented in the Background Information, needs only to reasonably reflect the record. Each area that the hearing officer addressed in the Background Information section is supported in the record. Accordingly, we cannot agree that the hearing officer’s decision was not based on the evidence or that the decision is improper.

Extent of injury is a factual question for the hearing officer to resolve. Section 410.165(a) provides that the hearing officer, as finder of fact, is the sole judge of the relevance and materiality of the evidence as well as of the weight and credibility that is to be given to the evidence. It was the hearing officer's prerogative to believe all, part, or none of the testimony of any witness, including that of the claimant. Aetna Insurance Company v. English, 204 S.W.2d 850 (Tex. Civ. App.-Fort Worth 1947, no writ). Nothing in our review of the record indicates that the hearing officer's extent-of-injury determination is so against the great weight and preponderance of the evidence as to be clearly wrong or manifestly unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986).

Section 417.001(a) provides, in part, that an employee may seek damages from a third party, who is or becomes liable to pay damages for a compensable injury, and may also pursue a claim for workers' compensation benefits. Section 417.001(b) provides for the subrogation rights of the insurance carrier. Section 417.002(a) provides that the net amount recovered by the 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. Section 417.002(b) provides that 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. Section 417.002(c) provides that 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, but if the advance is insufficient, the insurance carrier shall resume the payment of benefits when the advance is exhausted. The hearing officer noted that the claimant “presented no credible evidence that she received a third party settlement much less that she has exhausted the amount received in the settlement.” We perceive no reversible error in the hearing officer’s resolution of this issue.

The decision and order of the hearing officer are affirmed.

The true corporate name of the insurance carrier is AMERISURE INSURANCE COMPANY and the name and address of its registered agent for service of process is

CINDY GHALIBAF

7610 STEMMONS FREEWAY, SUITE 350

AUSTIN, TEXAS 78758.

Chris Cowan
Appeals Judge

CONCUR:

Edward Vilano
Appeals Judge

Veronica L. Ruberto
Appeals Judge

This appeal arises pursuant to the Texas Workers' Compensation Act, TEX. LAB. CODE ANN. § 401.001 et seq. (1989 Act). A contested case hearing was held on August 28, 2003. The hearing officer determined that respondent (carrier) is entitled to reimbursement from proceeds from claimant’s uninsured/underinsured motorist (UM) coverage in accordance with Section 417.001. Appellant (claimant) appealed this determination. Carrier responded that the Appeals Panel should affirm the hearing officer's decision and order.

DECISION

We reverse and render.

Claimant contends the hearing officer erred in determining that carrier is entitled to reimbursement from proceeds from claimant’s UM coverage in accordance with Section 417.001. The hearing officer accurately summarized the facts of this case. Briefly, claimant was involved in a work-related motor vehicle accident. He received $25,000 from his own insurance company pursuant to his UM coverage. Claimant paid the premiums for the UM coverage.

In the past, we have interpreted Sections 417.001 and 417.002 and determined that a carrier is entitled to subrogation even where the UM policy has been paid for by the injured worker. Since our decision in Texas Workers' Compensation Commission Appeal No. 001511, decided August 11, 2000, and Texas Workers' Compensation Commission Appeal No. 013070, decided February 4, 2002, the San Antonio court of appeals issued Liberty Mutual v. Kinser, 82 S.W.3d 71 (Tex. App.-San Antonio 2002, pet. withdrawn). In that case, the court held that the insurance carrier was not entitled to subrogation where the UM policy was paid for by the injured worker. The court said that the carrier was not entitled to subrogation because: (1) there were no amounts paid to the injured worker “by a third party”; (2) there are no “damages” involved because the term damages means those recovered from a third party who is liable to the injured worker because the third party breached a contract or committed a tortuious act against the injured employee; and (3) neither law nor equity is satisfied where the public policy against double recoveries trumps the public policy favoring giving people what they paid for when they have been prudent and have paid out of their own pocket for an insurance policy to protect themselves. In his dissents in Appeal Nos. 001511 and 013070, Judge Gary Kilgore also discussed some of these issues. After considering the record, briefs, and additional discussion of the law in Kinser, we now determine that we must retreat from our holdings in Appeal Nos. 001511 and 013070. We conclude that carrier is not entitled to subrogation in this case.

We reverse the hearing officer's decision and order and render a decision that carrier is not entitled to reimbursement from proceeds from the claimant’s UM coverage.

According to information provided by carrier, the true corporate name of the insurance carrier is (a self-insured governmental entity) and the name and address of its registered agent for service of process is

CORPORATION SERVICE COMPANY

800 BRAZOS

AUSTIN, TEXAS 78701.

Judy L. S. Barnes

CONCUR:

Gary L. Kilgore
Appeals Judge

Edward Vilano
Appeals Judge

This appeal arises pursuant to the Texas Workers' Compensation Act, TEX. LAB. CODE ANN. § 401.001 et seq. (1989 Act). A contested case hearing (CCH) was held on January 24, 2001. The issues involved whether the respondent (carrier) could suspend benefits because of a district court judgment in its favor in an intervention action that it contended was a “third party” subrogation. The appellant (claimant) argued that the carrier was not in fact entitled under the 1989 Act to bring the subrogation action, that the matter has been appealed to the Court of Appeals, and that the Texas Workers’ Compensation Commission (Commission) should thus not allow a suspension of income benefits under a void order. The carrier responded that the Commission had no jurisdiction to pronounce the order void, and that it should be allowed to suspend benefits. The hearing officer agreed, found no jurisdiction to overturn a district court order, and found that the carrier was entitled to suspend income benefits in conjunction with the lien created by the district court order allowing subrogation.

The claimant has appealed, and the carrier has responded, asserting the positions they asserted at the CCH. In addition, however, the claimant expresses concern at a statement of the hearing officer that the carrier did not demonstrate that the intervention had been made by the carrier paying workers’ compensation benefits. The carrier responded that the decision should be affirmed.

DECISION

We affirm the hearing officer’s decision.

It was stipulated on the record (if not fully memorialized in the decision) that the claimant sustained injury to his cervical spine and upper left extremity on __________. It was further stipulated that he was involved in a nonwork-related motor vehicle accident (MVA) on May 15, 1998. The claimant subsequently brought suit against the driver of the other car and eventually received a $165,000 settlement.

At the CCH, it was undisputed that the carrier intervened in this lawsuit and received an order, on summary judgment, granting it a subrogation interest in the settlement and against future benefits payable to the claimant. The name of the carrier identified as intervener in the district court proceedings was different than the name appearing as the carrier in this proceeding. However, on or about June 1, 2000, the claimant and the intervener carrier filed stipulations with the district court in which they agreed that the “intervener” had paid a total of $31,624.99 in workers’ compensation benefits to the date that the stipulations were signed. There was no challenge raised at the CCH as to the identity of the carrier herein with the intervener in the district court proceeding. However, the hearing officer sua sponte sought clarification from the carrier and received an answer that indicated that there are several related companies that are divisions or subsidiaries of essentially one insurance carrier.

The hearing officer did not err in holding that he had no authority to refuse to enforce the subrogation lien created by the judgment against the claimant’s future benefits. He further did not err in declining to regard that order as void.

Because we agree that a carrier who did not pay workers’ compensation benefits does not have a subrogation right, we will initially address the hearing officer’s statement in his discussion that “[a]t the [CCH] and subsequent to the [CCH] the carrier was unable to demonstrate that the intervention was made by the carrier that was paying workers’ compensation benefits.” This statement is not accurate given the stipulation filed in the district court proceeding that agreed that the intervener had paid workers’ compensation to the claimant. We would further note that during the CCH, there was no issue raised that the carrier in the Commission proceeding was not the intervener in the district court case, and the assumption throughout the argument and presentation of evidence was that they were the same.

The merits of the claimant’s argument that the carrier was not entitled to subrogation, in that the driver of the other vehicle is not a “third party” as contemplated by Section 417.001, is a matter to be adjudicated in the district court or on appeal from that judgment. The claimant has not cited any authority which either requires a carrier to bring its subrogation claim first to the Commission or which allows the Commission to relitigate the merits of a subrogation claim already determined by a district court. The claimant’s unpaid income benefits are subject to the lien created by the subrogation judgment. Section 408.203(a)(3). If the Commission were to decline to enforce the lien created by a district court order granting subrogation, the available funds for collecting the subrogation would diminish by the week, perhaps irreparably affecting the rights of the carrier. We note that any of the liens created under Section 408.203 could arguably have underlying meritorious arguments against the creation of the lien; nevertheless, the forum for adjudicating these matters is not the Commission.

The decision of the hearing officer will be set aside only if the evidence supporting the hearing officer's determination is so weak or against the overwhelming weight of the evidence as to be clearly wrong or manifestly unjust. Atlantic Mutual

Insurance Company v. Middleman, 661 S.W.2d 182 (Tex. App.-San Antonio 1983, writ ref'd n.r.e.). We do not agree that this was the case here, and affirm the hearing officer’s decision and order.

Susan M. Kelley
Appeals Judge

CONCUR:

Gary L. Kilgore
Appeals Judge

Robert W. Potts
Appeals Judge

This appeal arises pursuant to the Texas Workers’ Compensation Act, TEX. LAB. CODE ANN. § 401.001 et seq. (1989 Act). A contested case hearing was held on September 5, 2000. With regard to the issue before him, the hearing officer determined that the appellant (self-insured) is not entitled to treat the proceeds of the third-party recovery, and any future recovery, as an advance against future benefits.

The self-insured appeals, contending that it had not given a full release of its subrogation lien against the respondent (claimant) in return for $18,000.00, and that release was not an accord and satisfaction against future recovery. The self-insured requests that we reverse the hearing officer’s decision and render a decision in its favor. The claimant responds, urging affirmance.

DECISION

A timely appeal not having been filed, the decision and order of the hearing officer have become final pursuant to Section 410.169.

Records of the Texas Workers’ Compensation Commission (Commission) show that the self-insured hand-receipted for a copy of the hearing officer’s decision on September 8, 2000. Section 410.202(a) provides that a request for appeal shall be filed not later than the 15th day after the date on which the hearing officer’s decision is received, which in this case was September 8, 2000. Fifteen days from that date would be Saturday, September 23, 2000. Pursuant to Tex. W.C. Comm’n, 28 TEX. ADMIN. CODE § 102.3(a)(3) (Rule 102.3(a)(3)), if the last day of the period is not a working day as defined in Rule 102.3(b) the period is extended to the next working day, or, in this case, Monday, September 25, 2000.

In this case, the Commission received the claimant’s response on October 9, 2000, without having received an appeal. Inquiry with the self-insured indicated that the self-insured had mailed this appeal and another appeal together in an envelope at the same time. The other appeal was received and processed but did not contain any information about the instant case. The self-insured provided a receipt for certified mail showing a postmarked date of September 22, 2000, received September 26, 2000, which purported to contain both this appeal and the other appeal; however, the Commission records only show receipt of the other appeal. The self-insured subsequently sent a copy of its appeal in this case dated September 22, 2000, by facsimile transmission on November 1, 2000.

In that the appeal in this case was not filed until November 1, 2000, it was untimely filed, being after September 25, 2000.

The self-insured’s appeal being untimely, the decision of the hearing officer has become final pursuant to Section 410.169.

Thomas A. Knapp
Appeals Judge

CONCUR:

Kathleen C. Decker
Appeals Judge

Judy L. Stephens
Appeals Judge

This appeal arises pursuant to the Texas Workers’ Compensation Act, TEX. LAB. CODE ANN. § 401.001 et seq. (1989 Act). A contested case hearing was held on May 18, 2000. The hearing officer determined that the appellant (claimant beneficiary) has not exhausted the advance benefits from a third party recovery requiring respondent (carrier) to resume paying death benefits. Claimant beneficiary appeals this determination and carrier responded urging that claimant beneficiary’s appeal was untimely and also that the Appeals Panel should affirm the hearing officer’s decision and order.

DECISION

Claimant beneficiary did not file her appeal within the time period required by the rules of the Texas Workers’ Compensation Commission (Commission). Therefore, the appeal did not invoke the Appeals Panel’s jurisdiction and the hearing officer's decision and order have become final pursuant to Section 410.169.

The Commission’s records show that the hearing officer's decision was first mailed to claimant beneficiary at an incorrect address on July 10, 2000. On July 28, 2000, the decision was re-mailed to “[claimant beneficiary], (address).” Claimant beneficiary does not dispute that this was the last address provided by her to the Commission. Claimant beneficiary's request for review indicates that she did not receive the hearing officer's decision and order because it was mailed addressed to the deceased employee in this death benefits case, rather than to claimant beneficiary. However, Commission records do not support this assertion. Claimant beneficiary further asserts that the July 28, 2000, mailed decision was returned to the Commission undelivered because it was not addressed to claimant beneficiary. Commission records show that the first copy of the decision, which was mailed to the wrong address, was returned to the Commission. However, Commission records do not support the assertion that the copy of the decision and order mailed to claimant beneficiary on July 28, 2000, at her last known address, was returned to the Commission.

Rule 102.5(d) (Tex. W.C. Comm’n, 28 TEX. ADMIN. CODE § 102.5(d)), as amended effective August 29, 1999, provides that, unless the great weight of evidence indicates otherwise, a claimant is deemed to have received the hearing officer's decision five days after it was mailed, or on Wednesday, August 2, 2000. A request for review is timely if it is mailed on or before the 15th day after the date of receipt of the hearing officer's decision and if it is received by the Commission not later than the 20th day after the date of receipt of the decision. Rule 143.3(c). In this instance, the 15th day after the deemed date of receipt was Tuesday, August 17, 2000. Claimant beneficiary's request for review was dated August 23, 2000, and was mailed that same day. This was beyond the fifteenth day following the deemed date of receipt of the hearing officer's decision. Therefore, claimant beneficiary’s appeal is untimely.

Because claimant beneficiary did not file her request for review on time, the request for review did not properly invoke the Appeals Panel's jurisdiction. The hearing officer's decision and order became final pursuant to Section 410.169 and Rule 142.16(f).

Judy L. Stephens

CONCUR:

Elaine M. Chaney
Appeals Judge

Susan M. Kelley
Appeals Judge

This appeal arises pursuant to the Texas Workers’ Compensation Act, TEX. LAB. CODE ANN. § 401.001 et seq. (1989 Act). A contested case hearing was held on June 6, 2000. The sole issue had to do with whether the respondent (self-insured) was subrogated to amounts that were received by the appellant (claimant) in a settlement for her injuries with her own uninsured motorist policy. The hearing officer found that the self-insured was subrogated to these proceeds under Section 417.001 and 417.002. The claimant has appealed and argues that subrogation lies only against third parties, not against the policy proceeds for which the claimant is considered a first party. The self-insured responds that the scope of the "third party" against whose liability a subrogation interest lies is not limited in the statute as the claimant suggests.

DECISION

We affirm.

The claimant worked as a crossing guard for the self-insured when she was struck by a vehicle on _________. The self-insured had paid over $78,500.00 in income and medical benefits as a result of her injury.

A settlement was reached with the insurance company of the driver who was at fault ($25,000.00) and the self-insured was paid this settlement. At issue was whether a separate $20,000.00 settlement that the claimant entered into with her own insurance company's uninsured motorist coverage was subject to subrogation. The settlement was paid for the claimant's bodily injuries that were the subject of the workers’ compensation claim. The claimant did not notify the self-insured of her settlement negotiations. The claimant argued that a policy she paid for involved no "third parties" but constituted a "first party" recovery.

We do not agree that the hearing officer erred in rejecting this argument. It has already been held that Sections 417.001 and 417.002 do not limit the scope of "third party" to only a third-party tort-feasor. Employers' Casualty Company v. Dyess, 957 S.W.2d 884 (Tex. App.-Amarillo 1997, writ denied) (Dyess case). The rationale employed in this case was likewise applied to the 1989 Act. Texas Workers’ Compensation Insurance Facility v. Aetna Casualty and Surety Company, 994 S.W.2d 923 (Tex. App.-Houston [1st Dist.] 1999, no writ history) (Aetna case). As those cases also point out, a purpose of the subrogation statute was to avoid double recovery of damages for the injured worker. We note that the whole concept of "subrogation" means that the carrier essentially stands in the shoes of the injured worker with respect to any recovery to which that worker is entitled, either by tort or by contract, so the fact that an injured worker may be a "first party" with respect to the liable party is a distinction without a difference. In this case, the self-insured "stood in the shoes" of the claimant in her contract with her uninsured motorist policy for payment of damages. The damages for which she reached a settlement were entirely due to her work-related injury.

In our opinion, the reference to "third parties" in the statute refers to the standing that a liable party has with respect to the relationship between the workers’ compensation insurance carrier and the injured worker. Thus, as the Dyess case noted, an employer's uninsured motorist insurer is a "third party" for purposes of the statutory right of subrogation. As noted in the Dyess case, the statutory right of subrogation applies to any parties liable for injury, whether through tort or through contract. Dyess, page 891. This is broad enough to encompass the claimant's own uninsured motorist coverage, for which her liability insurer was "a third party" as to the claimant and the self-insured; although the claimant postulates that a carrier could obtain an array of benefits under the hearing officer’s decision, we would point out that Section 417.001 applies only to "damages" for an injury or death. Other policies, such as life insurance, whose payment is not contingent upon the existence of "damages," would not appear to be within the ambit of this statute. (Federal law would, of course, control whether social security benefits could be subject to subrogation.)

Finding the hearing officer's decision to be the correct application of the law, we affirm her decision and order.

Susan M. Kelley
Appeals Judge

CONCUR:

Tommy W. Lueders
Appeals Judge

DISSENTING OPINION:

I disagree with the majority that the decisions in Employer’s Casualty Company v. Dyess, 957 S.W.2d 884 (Tex. App.-Amarillo 1997, writ denied) (hereinafter Dyess) and Texas Workers’ Compensation Insurance Facility v. Aetna Casualty and Surety Company, 994 S.W.2d 923 (Tex. App.-Houston [1st Dist.] 1999, no writ history) (hereinafter Aetna) are controlling in the present case. Both Dyess and Aetna stand for the proposition that a carrier’s right to subrogation under the Texas Workers’ Compensation Act is not limited to damages collected from third-party tort-feasors. Both Dyess and Aetna clearly hold that the employer’s workers’ compensation carrier has the right to subrogate against proceeds from an employer’s uninsured/underinsured motor vehicle coverage when an employee is injured in a motor vehicle accident. The claimant argues that such a situation is distinguishable from the present case in which she collected from her own uninsured/underinsured motor vehicle policy. The claimant argues that the distinction is that she is first party beneficiary of her own policy for which she paid premiums, whereas a person collecting under the person’s employer’s uninsured/underinsured policy is only a third-party beneficiary of such coverage which was paid for by the employer.

I do believe that there is a basis for distinguishing between first- and third-party beneficiaries for the purposes of subrogation under the Texas Workers’ Compensation Act. As the Dyess court recognizes, a workers’ compensation carrier does not have a right of subrogation against a claimant’s life insurance policies when the claimant’s beneficiaries file a workers’ compensation death claim. Dyess at 891. Nor does a workers’ compensation carrier have a subrogation interest in a disability policy or in Social Security disability benefits even when the basis of a person’s collecting these benefits is disability resulting from an injury on the job. By their terms, the right to subrogation found in sections 417.001 and 417.002 deal with a right to subrogation from third parties. A policy of insurance purchased to protect one from the general hazards of life (or death) is simply not part of the benefits collected from a third party as a result of a work-related injury. The claimant, by purchasing uninsured/underinsured coverage, was protecting herself in the event of any accident she might have in which the negligence of an uninsured or underinsured motorist caused her injuries. To me this is more analogous to a person purchasing life insurance or disability insurance which would protect them in the event of death or disability due to any reason, not simply due to an injury on the job. The fact that a person would collect these benefits, whether or not the event triggering the payment of these benefits took place on the job or off the job, seems to me to be the basis for the fact that collecting these benefits, as well as the benefits provided by workers’ compensation, is not double recovery. If a worker had built up a personal savings account to protect against the hazards of life and had this savings available to help carry the worker through the financial strain of an on-the-job injury, it would not be double recovery for the worker to also collect the workers’ compensation benefits for which the worker’s employer had paid a premium. I do not think it is double recovery for a worker who has paid for additional insurance protection in the event of being injured in a motor vehicle accident to collect such benefits. To the degree that Dyess and Aetna are based upon preventing double recovery, they are distinguishable from the present case. In both Dyess and Aetna, the employer paid for the uninsured/underinsured motorist coverage and the claimants in those cases would have only been able to collect on the uninsured/underinsured policies had they been hurt on the job. In the present case, the claimant’s uninsured/underinsured policy covered her whether or not she was on the job. In this respect, her policy was more analogous to a life insurance or general disability policy than to the uninsured/underinsured coverage under consideration in Dyess and Aetna.

Also, I would note that in Bogart v. Twin City Fire Insurance Company, 473 F.2d 619 (5th Cir. 1973) (hereinafter Bogart) the court found that the workers’ compensation insurance carrier was not entitled to subrogation from the claimant’s own uninsured/underinsured motor vehicle policy. The rationale of Bogart was that the subrogation provision of the Texas workers’ compensation law only applied to third-party tort-feasors. While both the Dyess and Aenta courts explicitly declined to follow the rationale of Bogart, which would have dictated the opposite result in those cases, Bogart remains the only reported decision, of which I am aware, directly dealing with the subrogation rights of a workers’ compensation carrier claiming subrogation to the proceeds of a claimant’s own uninsured/underinsured policy. Allowing subrogation against the employer’s motor vehicle policy but not the claimant’s own policy has the happy result of reconciling the results of Bogart, Dyess, and Aetna. This is exactly what I would do. I would, therefore, reverse the hearing officer’s decision and render a decision that the self-insured in the present case is not entitled to subrogation. I think this would not result in double recovery for the claimant, but would preclude a windfall for the self-insured by preventing it from acquiring benefits bought and paid for by the claimant.

Gary L. Kilgore
Appeals Judge

This appeal is considered in accordance with the Texas Workers' Compensation Act, TEX. LAB. CODE ANN. § 401.001 et seq. (1989 Act). On February 18, 1999, a contested case hearing (CCH) was held. The issue concerned a matter relating to a third party recovery that the appellant (claimant) had obtained in a court proceeding resulting from his injury. The respondent (carrier) subsequently asserted a right to subrogation. The issue was whether the claimant had exhausted an advance that was attributed to a $25,000.00 Compromise Settlement Agreement (CSA) entered into with the carrier to resolve its subrogation claim. The CCH was held to compute whether the benefits due to claimant had met or exceeded that agreement.

The hearing officer determined that the "advance" had been exhausted, and that the carrier owed the claimant $1,380.59. This was essentially the agreement worked out by the parties at the CCH. The hearing officer found she had no jurisdiction to review the validity of the CSA.

The claimant appeals. Claimant argues that the hearing officer should have added an issue concerning the validity of the CSA, which the claimant asserts was forged. The carrier responds that the hearing officer correctly determined that she does not have jurisdiction to adjudicate the validity of an agreement filed in a court.

DECISION

Affirmed.

There were numerous proceedings held in various aspects of claimant's claim. Concerning the matter of subrogation, it was explained that the claimant had filed a third party lawsuit against numerous defendants and, according to the carrier's attorney, settled the matter with those parties. The carrier found out about the proceeding and asserted its right, under Section 417.002, to subrogation to the extent of benefits it paid or would pay out for workers' compensation. As the CCH in this case progressed, it became apparent that claimant was opposed to subrogation in general because he had not actually been paid any money directly as a result of the third party suit. He further asserted that the CSA was a forgery (it was signed by him and his wife and their attorney at the time, who was not the attorney at the CCH).

The claimant had sought to add the issue of the validity of the CSA by a pro se motion dated May 26, 1998. The hearing officer responded in an order dated May 27, 1998, by denying addition of the issue, but for the reason that it was already subsumed (included) in the issue relating to exhaustion of the credit. However, by the February 1999 CCH, the hearing officer stated that she could not adjudicate the validity of the CSA or the carrier's right to subrogation. The claimant's attorney at the CCH agreed with this and said that the recourse that they would follow would be to file a bill of review raising the validity of the CSA.

The carrier agreed at the CCH that the claimant had exhausted the amount of the agreed third party CSA and that it owed a balance. The claimant's attorney sought an agreement that this did not mean that claimant was giving up his rights to dispute the CSA in a another forum.

During the CCH, it became apparent that claimant also did not agree that the carrier should have subrogation if claimant himself were not paid money from the third party suit. He further became engaged in a dispute with his attorney and the hearing officer as to whether he was entitled to supplemental income benefits (SIBS) for the 17th quarter. Claimant maintained that, notwithstanding an order and Appeals Panel decision finding him not entitled to SIBS for this quarter, an ancillary agreement after the fact had been reached with the hearing officer and his attorney in attendance. This was respectfully denied by the attorney, who pointed out that the agreement in which he had been involved was for earlier quarters of SIBS, not the 17th quarter. The claimant nevertheless maintained that there was such an agreement whether his attorney was involved or not.

We agree that the hearing officer did not err by declining to adjudicate the validity of the CSA. Moreover, it does not appear that the matter was preserved at the hearing for appeal because the claimant and his attorney agreed at the CCH that this issue would be handled in another forum, specifically a bill of review proceeding in the court of competent jurisdiction. We will note, however, that the right to subrogation of the carrier (for reimbursement of income and medical benefits that have been paid or will be payable) does not derive from any agreement, but from the statute itself, notably Section 417.002. The only function of the CSA in this case would appear to be to fix the amount in question, not to establish the right to subrogation. Indeed, it has been held that the basic right of the carrier to reduce its liability due to the payment by a third party must not be compromised. American General Fire & Casualty Company v. McDonald, 796 S.W.2d 201, 204 (Tex. App.-San Antonio 1990, writ denied).

We accordingly affirm the hearing officer's decision and order.

Susan M. Kelley
Appeals Judge

CONCUR:

Joe Sebesta
Appeals Judge

Alan C. Ernst
Appeals Judge