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Lawmakers Criticize Texas Supreme Court

In what may be unprecedented, a bi-partisan group of Texas lawmakers filed an amicus brief with the Texas Supreme Court asking them to overturn their decision in Entergy v Summers. In that August 31, 2007 opinion, the court was faced with the question of whether a premises owner was a “general contractor” under the worker’s comp provisions of the Labor Code.

The Texas Labor Code provides that if an employer purchases worker’s comp insurance, an employee can’t sue its employer for injuries sustained in an on-the-job accident. In later sections, the statute also provides that if a general contractor purchases worker’s comp insurance that covers the employees of the general’s subcontractors, then the general contractor is considered the employer of the sub’s employees for purposes of worker’s comp laws.  In such a situation, if an employee of a sub is injured in an on-the-job accident, then the employee couldn’t sue the general contractor.  Contrast that to the situation where the sub buys its own insurance for its employees.  In that situation, if a sub’s employee is injured, then the employee can’t sue the sub (his employer) but could sue the general contractor if the general’s conduct contributed to the employee’s injuries.

In Entergy, the plaintiff was an employee of International Maintenance Corp. The company had contracted with Entergy to provide construction and maintenance on Entergy’s premises. In exchange for a reduced contract price, Entergy agreed to purchase worker’s comp coverage for IMC’s employees. The plaintiff was injured and sued Entergy for his damages.

Entergy argued that because it was the entity that purchased the worker’s comp insurance then it should be considered a “general contractor” and receive protection under the worker’s comp statute. The plaintiff, with whom the Court of Appeals agreed, made the logical argument that Entergy couldn’t be a contractor because it was the owner of the property — Entergy couldn’t contract with itself to perform work.   The plaintiff and the Court of Appeals cited existing Texas authority and such mainstream sources as CJS for the proposition that a general contractor is someone that contracts directly with the owner to perform work, not the owner itself.

It took the Texas Supreme Court a mere 13 paragraphs to dismiss the plaintiff’s arguments and his claims. Much of the opinion was based on the Court’s argument that the clear language of the statute demonstrates a clear legislative intent that an owner could be a contractor.

A motion for rehearing was filed, and with that motion, several groups have filed amicus curiae briefs. One of those briefs was a brief filed by four Texas legislators (two Republicans and two Democrats), who argued that it was never the legislature’s intent to allow immunity for landowners. The lawmakers wrote:

This Court, by disregarding the express terms of the Legislature’s enactments, has violated the separation of powers clause of the Texas Constitution and impermissibly encroached on the powers and functions expressly reserved the Legislature…

This Court’s holding in this case improperly extends that immunity to non-employer premises (plant) owners. The Legislature has never authorized such an extension, never intended to provide such an extension, and, in fact, has repeatedly rejected such an extension.

Of interest, one union has pointed out that if the Court’s opinion were in place in 2005, it would have prevented many of the injured workers from pursuing claims following the BP Texas City blast.

It should be interesting to watch how this plays out. I have no real faith that the Court will reverse the opinion, but maybe the amicus signals some hope that this problem will be fixed during the next legislative session.   At a minimum, it’s another group criticizing the Texas Supreme Court for what has become a pattern of results-oriented opinions in the favor of big business and insurance companies.

Fort Worth personal injury lawyer John Cummings also has a post on this subject.

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