Ricky Holder v. BMS Catastrophe, Inc.

Affirmed and Memorandum Opinion filed October 28, 2004 Affirmed and Memorandum Opinion filed October 28, 2004. In The Fourteenth Court of Appeals ____________ NO. 14-04-00181-CV ____________ RICKY HOLDER, Appellant V. BMS CATASTROPHE, INC., Appellee On Appeal from the 80th District Court Harris County, Texas Trial Court Cause No. 02-46213 M E M O R A N D U M   O P I N I O N Ricky Holder appeals from the trial court’s grant of summary judgment favoring BMS Catastrophe, Inc., on Holder’s negligence cause of action. The trial court held that Holder’s lawsuit was barred by the exclusive remedy provision of the Texas Workers’ Compensation Act. In a single issue, Holder contends that the provision does not bar his suit because BMS was not a subscriber under the Act, did not have workers’ compensation insurance, and was not an additional insured on another’s policy. Because the summary judgment evidence established that BMS provided workers’ compensation insurance through its contract with another company, we affirm. Background At the time of the injury, Holder was an employee of Adecco, a provider of temporary workers. Following Tropical Storm Allison, Adecco contracted with BMS to provide workers, including Holder, to assist in the cleanup of Memorial Hermann Hospital.[1] While working at this location and under the direction of a BMS supervisor, Holder used a chair as a step-stool to check a light fixture. When the chair slipped, he fell and allegedly injured his back. Holder brought suit against both Adecco and BMS, alleging that their negligence caused his injuries. Because Adecco carried workers’ compensation insurance, Holder’s action against it was non-suited pursuant to the exclusive remedy provision of the Texas Workers’ Compensation Act. Tex. Lab. Code Ann. § 408.001(a) (Vernon 1993). Subsequently, Holder accepted payments from Adecco’s insurer. BMS moved for summary judgment based on the exclusive remedy provision. Its motion was supported by uncontroverted testimonial evidence demonstrating that it had paid a provider’s fee to Adecco that included a mark-up for workers’ compensation insurance. The trial court granted summary judgment favoring BMS. Standard of Review We review summary judgments under a de novo standard. Provident Life & Acc. Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003). To obtain summary judgment, a movant must show that there is no genuine issue of material fact and that it was entitled to judgment as a matter of law. Tex. R. Civ. P. 166a(c); Nixon v. Mr. Prop. Mgmt., 690 S.W.2d 546, 548 (Tex. 1985). In determining whether a disputed fact issue exists, we must take evidence favorable to the nonmovant as true and resolve any doubts in favor of the nonmovant. Id. Summary judgment may be based on uncontroverted testimonial evidence by interested witnesses but only if the evidence is credible, clear, positive, direct, free from contradictions and inconsistencies, and could have been readily controverted. Tex. R. Civ. P. 166a(c). Discussion The Texas Labor Code provides that “recovery of workers’ compensation benefits is the exclusive remedy of an employee covered by workers’ compensation insurance coverage or a legal beneficiary against the employer or an agent or employee of the employer for the death of or a work-related injury sustained by the employee.” Tex. Lab. Code Ann. § 408.001(a). An “employer” is defined under the Act as “a person who makes a contract of hire, employs one or more employees, and has workers’ compensation insurance coverage.” Id. § 401.011(18).[2] In his sole issue, Holder contends that the exclusive remedy provision does not apply here because BMS did not have a policy in its name and was not listed as an additional insured under Adecco’s policy. We have held on several occasions that, in order to have workers’ compensation coverage, a special employer, or employer of a “borrowed employee,” does not have to be an actual policy holder or a named insured on another’s policy; it is sufficient that the costs of the insurance were paid by the special employer through its fees to the general employer. See Brown v. Aztec Rig Equip. Inc., 921 S.W.2d 835, 840 (Tex. App.—Houston [14th Dist.] 1996, writ denied); Gibson v. Grocers Supply, Co., 866 S.W.2d 757, 759 & n.2 (Tex. App.—Houston [14th Dist.] 1993, no writ); Marshall v. Toys-R-Us Nytex, Inc., 825 S.W.2d 193, 197 (Tex. App.—Houston [14th Dist.] 1992, writ denied) (“The manner in which the insurance is paid is immaterial as long as there is a compensation policy in force.”). Other courts of appeals have ruled similarly. See, e.g., Garza v. Excel Logistics, Inc., 100 S.W.3d 280, 288 (Tex. App.—Houston [1st Dist.] 2002, pet. granted) (holding that exclusive remedy provision applied to special employer because it paid costs of maintaining workers’ compensation insurance to general employer); Rodriguez v. Martin Landscape Mgmt., Inc., 882 S.W.2d 602, 605–06 (Tex. App.—Houston [1st Dist.] 1994, no writ) (holding that the client employer satisfied the statutory requirement by paying the general employer the cost of the workers’ compensation premiums); Cherry v. Chustz, 715 S.W.2d 742, 744 (Tex. App.—Dallas 1986, no writ) (“We see no reason why an employer cannot contractually provide for payment of premiums on his employees by a third party acting on his behalf.”); see also Pederson v. Apple Corrugated Packaging, Inc., 874 S.W.2d 135, 137–8 (Tex. App.—Eastland 1994, writ denied) (holding that exclusive remedy provision applied because plaintiff was covered through an arrangement between her employer and another company that actually held the policy).[3] Holder does not dispute the holdings in these cases but contends that the Texas Supreme Court recently overruled them in Wingfoot Enterprises v. Alvarado, 111 S.W.3d 134 (Tex. 2003). However, the Court in Wingfoot explicitly stated We think it prudent to emphasize that we are deciding today only whether there may be two employers for workers’ compensation purposes when a provider of temporary workers furnishes a worker to a client that controlled the details of the work at the time the worker was injured and there was no agreement between the provider of temporary workers and the client regarding workers’ compensation coverage. Id. at 144. The Court then cited several of the cases discussed above and stated that “[n]one of the issues presented in the foregoing cases are before us today, and we express no opinion on those issues.” Id. at 145. Thus, the supreme court expressly limited its holding to cases where the general and special employer have made no agreement regarding the provision of workers’ compensation coverage. Holder’s contentions regarding Wingfoot are without merit, and we continue to be bound by our prior decisions holding that a special employer is covered by the workers’ compensation exclusive remedy provision if that employer paid for workers’ compensation insurance through the general employer. See Brown, 921 S.W.2d at 840; Gibson, 866 S.W.2d at 759; Marshall, 825 S.W.2d at 197. We turn now to BMS’s summary judgment evidence. BMS presented testimonial evidence regarding its payment of workers’ compensation premiums through Adecco, Holder’s general employer. In his affidavit, Scott Bevier, a BMS Vice-President, stated that, during negotiations for temporary workers, a representative of Adecco specifically told him that the fee included workers’ compensation coverage. He further stated that this was standard industry practice, and he identified a check attached to his affidavit as payment from BMS to Adecco for the services of temporary workers, including Holder. In her deposition testimony, Diane Terry, Adecco’s regional representative, stated that, although she did not specifically remember discussing coverage with Bevier, Adecco’s pricing includes workers’ compensation premiums, she usually informs clients of this policy during negotiations, and it is standard industry practice to cover workers’ compensation premiums in the fees charged. Neither Bevier’s affidavit nor Terry’s deposition testimony was controverted by other evidence. The evidence could have been readily controverted and was otherwise credible, clear, positive, direct, and free from contradictions and inconsistencies. See Tex. R. Civ. P. 166a(c). Accordingly, we find that this evidence conclusively demonstrated that BMS provided for workers’ compensation benefits through its payments to Adecco. Therefore, summary judgment was properly granted based on the exclusive remedy provision of the Texas Workers’ Compensation Act. See Tex. Lab. Code Ann. § 408.001(a); Marshall, 825 S.W.2d at 197. Holder’s sole point of error is overruled. The trial court’s judgment is affirmed. /s/ Adele Hedges Chief Justice Judgment rendered and Memorandum Opinion filed October 28, 2004. Panel consists of Chief Justice Hedges and Justices Fowler and Seymore. [1] Accordingly, Adecco was Holder’s “general employer,” and BMS was his “special employer.” See generally Wingfoot Enters. v. Alvarado, 111 S.W.3d 134, 136 n.9, 143 n.55 (Tex. 2003). [2] In his summary judgment responses, Holder expressly acknowledged that he was employed by BMS at the time of the accident. [3] In Pederson, the Eastland Court of Appeals suggested that, because the exclusive remedy provision was amended to drop the requirement than an employer be a “subscriber,” all an employer had to prove to receive the benefit of the provision was that the employee was covered at the time of the injury. 874 S.W.2d at 138. However, the First Court of Appeals has disagreed with this analysis, stating that the change to the provision was a “distinction without a difference.” Rodriguez, 882 S.W.2d at 605 (holding that the Marshall case was still controlling). However, both interpretations are consistent with our ruling in the present case; therefore, we need not voice an opinion on this issue.