Opinion

Rosendo Morales v. Texas Department of Insurance-Division of Workers' Compensation, and Commissioner Ryan Brannan, in His Official Capacity

Court: Texas Court of Appeals, 3rd District (Austin)
Filed: May 27, 2015
Status: Published
Cited by: 0 cases
Authority: More cited than 3.1%

“Private parties may seek declaratory relief against state officials who allegedly act without legal or statutory authority.”

How later courts described this case

“Private parties may seek declaratory relief against state officials who allegedly act without legal or statutory authority.”
The Texas Supreme Court noted that no fault and no prejudice lies with non-parties to the UDJA
The Texas Supreme Court noted that no fault and no 10 No. 03-14-00808-CV Rosendo Morales Appellant’s Brief prejudice lies with non-parties to the UDJA

Written by the judges who cited it.

The opinion

ACCEPTED

03-14-00808-CV

5443753

THIRD COURT OF APPEALS

AUSTIN, TEXAS

5/27/2015 9:45:13 PM

JEFFREY D. KYLE

CLERK

No. 03-14-00808-CV FILED IN

IN THE 3RD COURT OF APPEALS 3rd COURT OF APPEALS

AUSTIN, TEXAS

AUSTIN, TEXAS 5/27/2015 9:45:13 PM

JEFFREY D. KYLE

Clerk

Rosendo Morales, Appellant

Texas Department of Insurance-Division of Workers’

Compensation and Commissioner Ryan Brannan, in his official

capacity, Appellees

On appeal from the 146th District Court of Bell County, Texas;

Cause No. 269,135-B, the Honorable Jack Weldon Jones

Presiding

ROSENDO MORALES APPELLANT’S BRIEF

BRADLEY DEAN McCLELLAN

State Bar No. 13395980

Richard Pena

Law Offices of Richard Pena, P.C

State Bar No. 00000073

Law Offices of Richard Pena, P.C.

1701 Directors Blvd., Suite 110

Austin, Texas 78744

Brad.McClellan@yahoo.com

(512) 327-6884 telephone

(512) 327-8354 facsimile

Counsel for Appellant

May 27, 2015

Oral Argument Requested

IDENTITY OF PARTIES & COUNSEL

PLAINTIFF/APPELLANT: P.O. Box 12548 (MC-018), Capital

Rosendo Morales c/o Station

Law Offices of Richard Pena, P.C. Austin, Texas 78711-2548

1701 Directors Blvd. 512-475-4208

Austin, Texas 78744 512-320-0167 facsimile.

Addrienne.butcher@texasattorneyge

TRIAL AND APPELLATE ATTORNEY neral.gov

FOR PLAINTIFF: Attorneys for DWC and

Bradley Dean McClellan Commissioner

State Bar No. 13395980

Richard Pena OTHER DEFENDANT BELOW:

Law Offices of Richard Pena, P.C Texas Mutual Insurance Company,

State Bar No. 00000073 the Insurance Carrier

1701 Directors Blvd. Suite 110 c/o

Austin, Texas 78744 Scott Placek

Brad.McClellan@yahoo.com Matthew Foerster

Fax 512.327.8354 Arnold & Placek, LLC

Telephone 512.327.6884 203 East Main Ave, Ste. 203

Round Rock, TX 78664

Fax: 512 341.7121

DEFENDANT/APPELLEE: Attorneys for Defendant

Texas Department of Insurance – TMIC

Division of Workers' Compensation,

DWC, a governmental unit organized

and existing under the law of the

State of Texas, and Commissioner

Ryan Brannan, in his official capacity

7551 Metro Center Drive, Suite 100

Austin, TX, 78744

Attorneys for DWC and Commissioner:

Adrienne Butcher,

Assistant Attorney General

Administrative Law Division

Office of the Attorney General of

Texas

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

TABLE OF CONTENTS

TABLE OF AUTHORITIES iv-vi

IDENTITY OF PARTIES & COUNSEL ii

STATEMENT OF THE CASE vii

ISSUES PRESENTED ix

ROSENDO MORALES APPELLANT’S BRIEF 1

SUMMARY OF ARGUMENT 6

STATEMENT OF FACTS 3

ARGUMENT & AUTHORITIES 10

Issue No. 1: Whether the District Court has jurisdiction to determine a

declaratory judgment action brought to properly construe, interpret,

and enforce applicable Texas statutes against the state agency and the

head of the state agency after administrative remedies have been

exhausted and a live controversy remains with allegations that the state

defendants have violated the statutes in question by failing to properly

apply the law? 10

CONCLUSION 43

PRAYER 44

CERTIFICATE OF COMPLIANCE 46

CERTIFICATE OF SERVICE 46

APPENDIX 47

iii

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

INDEX OF AUTHORITIES

Cases

Beacon Nat 'I Ins. Co. v. Montemayor, 86 S.W.3d 260, 267 (Tex. App.-Austin

2002, no pet.) .................................................................................................................... 30

Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554-55 (Tex. 2000) ................ 33

Brooks v. Northglen Ass'n, 141 S.W.3d 158, 163 (Tex. 2004) ..................... 10, 18

Calvert v. Employees Ret. Sys. of Tex., 648 S.W.2d 418, 419 (Tex. App.--

Austin 1983, writ ref'd n.r.e.) ..................................................................................... 34

Campos v. Texas Prop. & Cas. Ins. Guar. Ass'n, 282 S.W.3d 226, 230 (Tex.

App.—Austin 2009, no pet.) ....................................................................................... 17

City of El Paso v. Heinrich, 284 S.W.3d 366, 373 n.6 (Tex. 2009) .................... 12

City of McKinney v. Hank's Rest. Group, L.P., 412 S.W.3d 102, 112 (Tex.

App.—Dallas 2013, no pet.) ........................................................................................ 12

Cobb v. Harrington, 144 Tex. 360, 190 S.W.2d 709, 712 (1945)...................... 35

Harvel v. Tex. Dep't of Ins.-Div. of Workers' Comp., 13-14-00095-CV, 2015

Tex. App. LEXIS 5159, 2015 WL 2452703 (Tex. App. Corpus Christi--May

21, 2015, motion for rehearing to be filed) .......................................................... 12

Hawkins v. El Paso First Health Plans, Inc., 214 S.W.3d 709, 716-18 (Tex.

App.--Austin 2007, pet. filed). ..................................................................................... 35

Houston General Insurance Co. v. Association Casualty Insurance Co., 977

S.W.2d 634 (Tex. App.—Tyler, no pet.) .................................................................. 43

Howell v. Texas Workers' Compensation Com'n, 143 S.W.3d 416, 433 (Tex.

App.--Austin 2004, pet. denied). ................................................................................ 43

Kuntz v. Khan, No. 03-10-00 160-CV, 2011 Tex. App. LEXIS 446, 2011 WL

182882,(Tex. App.--Austin 2011, no pet.) ............................................................ 30

Mid-Century Insurance Company v. Texas Workers’ Compensation

Commission, 187 S.W.3d 754 (Tex. App.—Austin 2006, no pet.). ............... 39

Nat'l Am. Ins. Co. and TDI-DWC and Commissioner Bordelon in his official

capacity v. Tex. Prop. & Cas. Ins. Guar. Ass'n, No. 03-09-00680-CV, 2013

WL 4817637, 2013 Tex. App. LEXIS 10865 (Tex. App.--Austin Aug. 28,

2013, no pet.) ................................................................................................................ 8, 18

Nat'l Am. Ins. Co. v. Tex. Prop. & Cas. Ins. Guar. Ass'n for Paula Ins. Co., 2013

Tex. App. LEXIS 10865, 2013 WL 4817637 (Tex. App.--Austin Aug. 28,

2013, no pet.) .................................................................................................................... 35

Roal Global Corp. v. City of Dallas, 2015 Tex. App. LEXIS 5205 (Tex. App.

Dallas--May 21, 2015, no pet. h.) .............................................................................. 12

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Severiano DeLeon v. Royal Indemnity Company, 396 S.W.3d 597 (Tex. App.--

Austin 2010) rev’d on other grounds Severiano DeLeon v. Royal Indem.

Co., 396 S.W.3d 527 (Tex. 2012) ........................................................................ 25, 26

Spawglass Constr. Corp. v. City of Houston, 974 S.W.2d 876, 878 (Tex. App.--

Houston [14th Dist.] 1998, pet. denied) .................................................................. 34

Subchapter F of Chapter 410 .......................................................................................... 16

Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex.1993) .. 32

Tex. Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex.2004) 32

Tex. DOT v. Sefzik, 355 S.W.3d 618, 621-622 (Tex. 2011). ................................. 14

Tex. Educ. Agency v. Leeper, 893 S.W.2d 432, 446 (Tex. 1994). ....................... 13

Tex. Lottery Comm'n v. First State Bank of DeQueen, 325 S.W.3d 628, 634-35

(Tex. 2010) ......................................................................................................................... 13

Tex. Natural Res. Conservation Comm'n v. IT-Davy, 74 S.W.3d 849, 859-60

(Tex. 2002) ......................................................................................................................... 13

Tex. Prop. & Cas. Guar. Ass'n v. Nat'l Am. Ins. Co., 208 S.W.3d 523, 533 (Tex.

App.--Austin 2006, pet. denied). ............................................................................... 15

Tex. Workers' Compensation Ins. Fund v. Tex. Workers' Compensation

Comm'n & Watts, 124 S.W.3d 813, 820 (Tex. App.--Austin 2003, pet.

denied) ........................................................................................................................... 20, 22

Texas Ass'n of Business v. Texas Air Control Bd., 852 S.W.2d 440 at 446 (Tex.

1993) .................................................................................................................................... 33

Texas Dep. of Ins., Div. of Workers’ Compensation v. Lumbermens Mut. Cas.

Co., 212 S.W.3d 870 (Tex App.—Austin 2006, pet. denied) ............... 8, 20, 24

Texas Educ. Agency v. Leeper, 893 S.W.2d 432, 446 (Tex.1994) ...................... 37

Texas Government Code section 2001.171 .............................................................. 16

Texas Liquor Control Bd. v. Canyon Creek Land Corp., 456 S.W.2d 891, 895

(Tex.1970) .......................................................................................................................... 38

Texas Mun. Power Agency v. Public Util. Comm'n, 100 S.W.3d 510, 520 (Tex.

App.--Austin 2003, pet. denied) ................................................................................. 39

Texas Mun. Power Agency v. Public Utility Com'n of Texas, 253 S.W.3d 184,

189 (Tex. 2007) ................................................................................................................ 37

Texas Natural Res. Conservation Comm'n v. IT-Davy, 74 S.W.3d 849, 855

(Tex. 2002) ......................................................................................................................... 35

Texas State Employees Union/CWA Local 6184 v. Texas Workforce Comm'n,

16 S.W.3d 61, 65 (Tex. App.-Austin 2000, no pet.). ........................................... 33

Texas Workers' Compensation Commision v. Garcia, 893 S.W.2d 504 (Tex.

1995) ..................................................................................................................................... 38

Young Chevrolet, Inc. v. Tex. Motor Vehicle Bd., 974 S.W.2d 906,911 (Tex.

App.--Austin 1998, pet. denied) ................................................................................ 31

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Statutes

Tex. Civ. P. & Rem. Code § 37.006 .......................................................................... 10, 18

Tex. Civ. Prac. & Rem. Code §37.003(a) ..................................................................... 43

Tex. Civ. Prac. & Rem. Code §5.062(a) ........................................................................ 43

TEX. INS. CODE § 462.017(b) .............................................................................................. 17

Tex. Lab. Code §410.204(a) ............................................................................................ 22

TEX. LAB. CODE § 408.123(a). ............................................................................................ 27

TEX. LAB. CODE § 410.252(b) ............................................................................................. 17

Texas Labor Code § 410.254 .............................................................................................. 7

Texas Labor Code §410.252(b)(1) ............................................................................... 17

Texas Labor Code Section 401.011(12) ........................................................................ 7

Texas Labor Code Section 408.124(c) ........................................................................ 26

Texas Labor Code Sections 401.011(23) & (24) .................................................... 27

Other Authorities

Camp v. Greene County Tech. et. al, decided October 17, 2008, 2008 WL

4686198 (Ark.Work.Comp.Com.) 29

DWC APPEAL NO. 050140, 2005 TX Wrk. Comp. LEXIS 57 (decided March

14, 2005) 40

DWC APPEAL NO. 94994, 1994 TX Wrk. Comp. LEXIS 6081, September 9,

1994 41

DWC APPEAL NO. 951802, 1995 TX Wrk. Comp. LEXIS 4964, December 13,

1995 42

DWC Appeal No. 990005, 1999 TX Wrk. Comp. LEXIS 3029, decided

February 19, 1999 42

DWC Appeals Panel Decision No. 080375, May 15, 2008, 2008 WL 2233469

DWC Appeals Panel No. 071023-s, decided July 23, 2007, 2007 TX Wrk.

Comp. LEXIS 54. 40

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

STATEMENT OF THE CASE

This case involves primarily questions of law and statutory violations

by a state agency and agency official and the workers’ compensation

insurance carrier which arose out of an actual workers’ compensation

dispute and the improper interpretation and application of the

Legislature’s statutory terms by both the workers’ compensation insurance

carrier and the Texas Department of Insurance-Division of Workers’

Compensation (DWC), which is the state agency charged with properly

applying, enforcing, and interpreting the Texas Labor Code and Texas

Insurance Code along with the DWC Commissioner in his official capacity.

Rosendo Morales is the injured Texas worker. The injured worker has

workers’ compensation coverage through the other Defendant below, the

Texas Mutual Insurance Company. The administrative judge ruled in favor

of the Defendant Insurance Carrier, and Rosendo Morales appealed and the

final DWC administrative decision as improperly limiting his impairment

rating to not include the four level cervical fusion and seeking declaratory

judgment relief. CR 47. Rosendo Morales filed for judicial review in the

146th District Court of Bell County challenging the final DWC

determinations and seeking a declaratory judgment of proper statutory

enforcement and interpretation under the Texas Labor Code and the Texas

vii

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Insurance Code. CR 4, 47. The DWC filed an original answer and general

denial in part arguing sovereign immunity from suit. CR 74. Texas Mutual,

the Insurance Carrier, finally answered and filed special exceptions. CR 21.

The Honorable Judge Jack Jones granted the DWC Defendants’ plea to the

jurisdiction and dismissed the DWC and the Commissioner from the

lawsuit, and he granted Texas Mutual’s Plea to the Jurisdiction, CR 288-

289. Plaintiff brings this interlocutory appeal challenging the plea to the

jurisdiction dismissing DWC and the DWC Commissioner from the case and

granting DWC’s plea to the jurisdiction.

viii

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

ISSUE PRESENTED

Issue No. 1: Whether the District Court has jurisdiction to determine a

declaratory judgment action brought to properly construe, interpret, and

enforce applicable Texas statutes against the state agency and the head of

the state agency after administrative remedies have been exhausted and a

live controversy remains with allegations that the state defendants have

violated the statutes in question by failing to properly apply the law?

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

No. 03-14-00808-CV

IN THE 3RD COURT OF APPEALS

AUSTIN, TEXAS

Rosendo Morales, Appellant

Texas Department of Insurance-Division of Workers’

Compensation and Commissioner Ryan Brannan, in his official

capacity, Appellees

On appeal from the 146th District Court of Bell County, Texas;

Cause No. 269,135-B, the Honorable Jack Weldon Jones

Presiding

ROSENDO MORALES APPELLANT’S BRIEF

To the Honorable Justices of the 3rd Court of Appeals:

A state agency is not free to misinterpret and misapply the laws of the

Texas Legislature, and the Courts of this State are duty bound to make sure

the laws of this State are properly applied, interpreted and enforced. Texas

citizens have a right to seek declaratory judgments concerning statutory

rights especially where administrative remedies have been exhausted. This

Court previously allowed a declaratory judgment action against the DWC in

Tex. Dep’t of Ins. v. Lumbermens Mut. Cas. Co., 212 S.W.3d 870 (Tex. App.—

Austin 2006, pet. denied), which resulted in erroneous applications of the law

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

from dicta. For almost a decade now, the Lumbermens declaratory judgment

decision unleashed the DWC and the Commissioner and insurance carriers

such as Texas Mutual, to erroneously deprive severely injured workers like

Mr. Morales proper impairment ratings. Workers who undergo insurance

carrier approved and paid for spinal fusion surgeries occurring before the

worker’s recovery stabilizes at maximum medical improvement must have

such surgeries and the effects of such surgeries considered and rated when

impairment ratings are assigned.

A state agency may not prevent a parties challenge that a statute is not

being properly applied, interpreted and enforced. The state agency is a

necessary party for such a declaration, and such a declaration would be

unenforceable without the proper state agency. The final decision of the

Texas Department of Insurance-Division of Workers’ Compensation and

Commissioner Brannan, collectively the DWC, refused to allow a proper rating

for a four level cervical spinal fusion surgery which occurred prior to

maximum medical improvement.

The Defendants, the Texas Department of Insurance-Division of

Workers’ Compensation, DWC, and the Commissioner and the Defendant

Texas Mutual Insurance Carrier, appear to wish to avoid clear legal statutory

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

construction and proper statutory application questions raised by the

Plaintiff, Rosendo Morales, the injured worker. Mr. Morales believes his legal

positions are correct, but the Defendants apparently do not want a clear

statement of the law even though in other cases the Defendants have sought

declaratory legal determinations.

This case involves a proper request for declaratory judgment with a

challenge to the DWC Defendants improper enforcement of the law. A

justiciable controversy exists; exhaustion of administrative remedies

occurred; and clear questions of law concerning statutory interpretations and

failure to apply and enforce the law properly exist. Mr. Morales asserts the

legal declarations should be decided in his favor and help bring an end to this

litigation and protect his right to the limited recovery of workers’

compensation benefits for impairment ratings for permanent anatomic and

functional loss. Especially, the DWC and the Commissioner cannot avoid the

law and cannot hide from being required to follow the law and to properly

interpret, apply, and enforce the law as written by the Legislature.

STATEMENT OF FACTS

Rosendo Morales, a Texas worker, suffered severe injuries on November

22, 2010 while in the course and scope of his employment with his employer,

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Perry & Perry Builders, Inc.1 Texas Mutual Insurance Company provided

workers compensation insurance as the Insurance Carrier on the date of the

worker’s injuries.2 It is undisputed that Mr. Morales sustained a

compensable left shoulder contusion, left upper arm contusion, right heel

contusion, right knee contusion, right knee meniscal tear and arthritis, neck

contusion, and C5-6 radiculopathy on November 22, 2010.3 The parties

stipulated that Claimant reached maximum medical improvement on the

statutory date of December 26, 2012.4 Prior to reaching maximum medical

improvement, Mr. Morales underwent a multi-level cervical spinal fusion

fusing his cervical spine closed across four levels of his spine. The DWC was

asked to determine the proper impairment rating (and good cause for Texas

Mutual missing the first scheduled hearing).5 The DWC hearing officer

determined that neither the impairment rating was 13% with 8% other body

parts and only 5% for the cervical spine and rejected the other impairment

rating which had 8% for the other body parts and 27% for the fused cervical

spine6 and the Insurance Carrier was ordered to pay workers’ compensation

1 CR 61 DWC Hearing Decision

2 CR 61

3 CR 61

4 CR 62

5 CR 58

6 CR 61

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

benefits consistent with the decision.7 The live pleadings of the Plaintiff are

attached as Appendix 2, Plaintiff’s First Amended Petition and Suit for

Declaratory Judgment and Exhibit “A” DWC Contested Case Hearing Decision

signed October 22, 2014, and DWC finality notice of January 27, 2014.

Rosendo Morales filed his lawsuit for declaratory judgment against the

Insurance Carrier and the DWC and the DWC Commissioner.8 The DWC also

filed a plea to the jurisdiction asserting sovereign immunity.9 Mr. Morales

asked that the District Court declare his real rights to enforce the statute in

compliance with statutory provisions which the DWC and the DWC

Commissioner and the Insurance Carrier defendants who have not followed

and not properly applied and properly enforced the Texas Labor Code

provisions. 10

The District Court granted the DWC and the Commissioner plea to the

jurisdiction along with Texas Mutual’s Plea to the jurisdiction.11 This

interlocutory appeal was brought by Rosendo Morales challenging the

granting of the plea to the jurisdiction and dismissal of the DWC and the DWC

Commissioner from this matter.

7 CR 62

8 CR 47 Plaintiff’s 1st Amended Petition and Suit for Declaratory Judgment

9 CR 60, 105

10 CR 50-51

11 CR 287,288

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

SUMMARY OF THE ARGUMENT

A state agency which intervenes in a lawsuit may not be dismissed on

jurisdictional grounds from the lawsuit it joined avoid being a necessary party

to a statutory declaration lawsuit concerning the statutes the agency is

charged to regulate and to enforce and to properly apply. Further, when the

state agency acts beyond and in derogation of its statutory authority, the state

official is a proper party to a lawsuit alleging such ultra vires acts under

Heinrich. This is especially clear when administrative remedies have been

exhausted. This Court of Appeals previously rejected the DWC and the

Commissioner’s argument that only judicial review between the parties is

permissible:12

The Division argues that because the carriers are permitted to seek

judicial review of hearing decisions applying the advisories under

section 410.251 of the labor code, they are barred from bringing

declaratory judgment actions under the UDJA challenging the same

decisions.

The 3rd Court rejected the DWC’s similar arguments and concluded: “that the

trial court had jurisdiction over the declaratory judgment action pursuant to

the UDJA.”13 This matter is not different.

In this matter, Rosendo Morales has sought declaratory judgments that

12 Texas Dep. of Ins., Div. of Workers’ Compensation v. Lumbermens Mut. Cas. Co.,

212 S.W.3d 870, 874 (Tex App.—Austin 2006, pet. denied)

13 Lumbermens at 875

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

assert the DWC Defendants and Commissioner and the Insurance Carrier have

not properly interpreted, applied, and enforced the Texas Workers’

Compensation Act under Texas Labor Code Provisions. Included in the

declarations of law sought are the proper application, interpretation, and

enforcement of TEXAS LABOR CODE. The legal resolution of the declarations will

likely resolve the underlying administrative controversy where the material

facts are not disputed. Without declarations, these legal questions will arise

again and again and again. Workers’ compensation system participants are

entitled to a final declaration of, interpretation, and enforcement of the

statutory terms by the Judicial Branch subject only to changes in the laws by

the Texas Legislature.

Texas Courts are duty bound to properly construe statutory requirements

especially where the Legislature’s will is clearly ignored.

Here the DWC’s and the Commissioner’s position appears to be that it is

only allowed to intervene under Texas Labor Code § 410.254, but that the

DWC is somehow not a necessary or proper party in such suits enforcing the

statutes which the DWC is required to enforce appears to create a dichotomy.

This allows the DWC to continually misapply and misinterpret the law and act

in violation of the law without being held accountable. The DWC and the

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Commissioner’s similar jurisdictional pleas arguing immunity from

declaratory judgments were rejected by this Court of Appeals in 2006 in DWC

v. Lumbermens and in 2013, last year, in the Nat’l Ins. and DWC &

Commissioner v. TPCIGA decisions.14 The DWC and the Commissioner are

clearly necessary to have the Texas Workers’ Compensation Act and other

applicable statutes properly applied in workers’ compensation disputes

concerning legal rights.

If the DWC and the Commissioner are correct, then the Judicial Branch

of Texas government would lose its oversight of the Executive Branches

proper application, proper interpretation, and proper enforcement of the laws

adopted by the Texas Legislature and state agencies would be free to violate

the very statutes which the agency and the state official is bound to uphold.

This case involves a justiciable controversy, properly exhausted

administrative remedies, and clear questions of law concerning statutory

interpretations, alleged statutory violations by the DWC and failure to

properly apply the law. The DWC and the Commissioner cannot avoid the law

14Texas Dep. of Ins., Div. of Workers’ Compensation v. Lumbermens Mut. Cas. Co.,

212 S.W.3d 870 (Tex App.—Austin 2006, pet. denied); Nat'l Am. Ins. Co. and

TDI-DWC and Commissioner Bordelon in his official capacity v. Tex. Prop. & Cas.

Ins. Guar. Ass'n, No. 03-09-00680-CV, 2013 WL 4817637, 2013 Tex. App. LEXIS

10865 (Tex. App.--Austin Aug. 28, 2013, no pet.)

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

and cannot hide from being required to follow the law when the state agency’s

actions violate the statutory requirements.

Appellant is not seeking damages from the state Defendants. Appellant

is seeking to enforce the statutory rights violated by the Defendants.

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

ARGUMENT & AUTHORITY

Issue No. 1: Whether the District Court has jurisdiction to determine a

declaratory judgment action brought to properly construe, interpret,

and enforce applicable Texas statutes against the state agency and the

head of the state agency after administrative remedies have been

exhausted and a live controversy remains with allegations that the state

defendants have violated the statutes in question by failing to properly

apply the law?

1. The District Court erred in Dismissing the DWC and the

Commissioner.

The DWC and the Commissioner appear to allege declaratory relief is not

available at all against the DWC and the Commissioner. Texas Mutual, in

response to Plaintiff’s Interrogatory No. 5 conceded: “However, in the event

the Court permits this declaratory judgment action to proceed, the DWC

and its commissioner would be necessary parties.” All parties involved

will be affected by the declaratory judgment action and to be of any force and

effect, the UDJA unequivocally mandates:

(a) When declaratory relief is sought, all persons who have or claim any

interest that would be affected by the declaration must be made

parties. A declaration does not prejudice the rights of a person not a

party to the proceeding.

TEX. CIV. P. & REM. CODE § 37.006. See Brooks v. Northglen Ass'n, 141 S.W.3d

158, 163 (Tex. 2004) (The Texas Supreme Court noted that no fault and no

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

prejudice lies with non-parties to the UDJA). The injured worker has properly

included the workers’ compensation insurance carrier, and the Texas

Department of Insurance-Division of Workers’ Compensation, DWC and the

Commissioner in this declaratory action.

A state agency may not avoid being a necessary party to a statutory

declaration lawsuit concerning the statutes the agency is charged to regulate,

to interpret, to apply, to adjudicate, and to enforce. This is especially clear

when administrative remedies have been exhausted and a live controversy

exists. The 3rd Court of Appeals previously rejected the DWC and the

Commissioner’s argument that:15

The Division argues that because the carriers are permitted to seek

judicial review of hearing decisions applying the advisories under

section 410.251 of the labor code, they are barred from bringing

declaratory judgment actions under the UDJA challenging the same

decisions.

The 3rd Court rejected the DWC’s similar arguments and concluded: “that the

trial court had jurisdiction over the declaratory judgment action pursuant to

the UDJA.”16

The Texas Supreme Court has held that the UDJA waives a municipality's

immunity against claims challenging the validity of its ordinances. City of El

15 Texas Dep. of Ins., Div. of Workers’ Compensation v. Lumbermens Mut. Cas. Co.,

212 S.W.3d 870, 874 (Tex. App.—Austin 2006, pet. denied)

16 Lumbermens at 875

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Paso v. Heinrich, 284 S.W.3d 366, 373 n.6 (Tex. 2009). The Court explained

that that the governmental entity retains its immunity from suit when the

claimant does not challenge the validity of a statute but rather challenges a

government officer's application of a statute to the claimant. 284 S.W.3d at

372-73 & n.6. The affected parties remedy is an ultra vires suit against the

government officer in his or her official capacity for prospective relief. Id. at

369-74. This would support DWC Commissioner being a party in this matter

to properly apply the statutes in question and provide a valid interpretation

and application and enforcement of statutes.

Contrast this matter with Roal Global Corp. v. City of Dallas, 2015 Tex.

App. LEXIS 5205 (Tex. App. Dallas--May 21, 2015, no pet. h.); City of

McKinney v. Hank's Rest. Group, L.P., 412 S.W.3d 102, 112 (Tex. App.—Dallas

2013, no pet.); Harvel v. Tex. Dep't of Ins.-Div. of Workers' Comp., 13-14-00095-

CV, 2015 Tex. App. LEXIS 5159, 2015 WL 2452703 (Tex. App. Corpus Christi-

-May 21, 2015, motion for rehearing to be filed) (13th Court of Appeals

determined sovereign immunity bars the claims against state agency and that

a Heinrich challenge was not alleged.).

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

2. Declaratory Statutory Challenges Require State Agency to be a

Party

Recent Texas Supreme Court cases also support that the state agency is a

proper party in a declaratory action to determine parties’ rights under the

statute that the agency regulates and enforces especially where the state

agency’s violates the statutory terms. Tex. Lottery Comm'n v. First State Bank

of DeQueen, 325 S.W.3d 628, 634-35 (Tex. 2010); Tex. Natural Res.

Conservation Comm'n v. IT-Davy, 74 S.W.3d 849, 859-60 (Tex. 2002); Tex.

Educ. Agency v. Leeper, 893 S.W.2d 432, 446 (Tex. 1994).

In DeQueen subsequent to Heinrich, the Texas Supreme Court reiterated

that Declaratory Judgment Act suits to construe statutes are expressly allowed

jurisdictionally against a state agency. Texas Lottery Commission v. First State

Bank of DeQueen, 325 S.W.3d 628 (Tex. 2010). The DWC and the

Commissioner are proper parties because without them the statutory legal

questions and statutory application would not be applicable to the DWC and

the Commissioner. The Supreme Court in DeQueen reiterated that jurisdiction

over the state agency existed and citing to Leeper explained:

[T]he DJA permits statutory challenges and governmental entities may

be bound by those challenges, the DJA contemplates entities must be

joined in those suits. Leeper, 893 S.W.2d at 446.

The Texas Supreme Court further explained in DeQueen that statutory

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

clarification, as expressly sought in this matter, that the state agency is a

proper party:17

Next, the Commission asserts that the DJA does not waive immunity

because it applies only to suits involving constitutional invalidation and

not to those involving statutory interpretation. But the language in the

DJA does not make that distinction. In Leeper, . . . . the DJA discussion

was in the context of a statutory clarification. . . . . The decision on

this claim may ultimately impact actions taken by officers of the

Commission, but that does not deprive the trial court of jurisdiction.

[Leeper] at 445 (noting that the DJA allows courts to declare relief

"whether or not further relief is or could be claimed"). The trial court

properly exercised jurisdiction over this claim.

Subsequent to DeQueen, the Texas Supreme Court in Sefzik explained:18

As noted, we dismissed Heinrich's claims seeking declaratory and

injunctive relief against governmental entities, brought under the UDJA,

because the entities were immune. In so doing, we necessarily concluded

that the UDJA does not waive the state's sovereign immunity when the

plaintiff seeks a declaration of his or her rights under a statute or other

law. Very likely, the same claim could be brought against the appropriate

state official under the ultra vires exception, but the state agency remains

immune. See id. at 372-73. As we have consistently stated, the UDJA does

not enlarge the trial court's jurisdiction but is "merely a procedural

device for deciding cases already within a court's jurisdiction." Tex. Parks

& Wildlife Dep't v. Sawyer Trust, 354 S.W.3d 384, 2011 Tex. LEXIS 640, *8

(2011) (quoting Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440,

444 (Tex. 1993)).

Sefzik would have allowed a claim for statutory rights enforcement and

declaration to be brought as long as the appropriate state official be named—

which the DWC Commissioner is named herein to cover the Heinrich

17 DeQueen, 325 S.W.3d 628 at 635.

18 Tex. DOT v. Sefzik, 355 S.W.3d 618, 621-622 (Tex. 2011).

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

determination where the state official is ignoring the law, the state official is a

proper party.

3. Under Labor Code Section 410.255, the DWC is a proper party for

all other issues, which likely includes the Proper Enforcement of

the Law for Assigning Impairment Ratings.

If this declaratory judgment action is viewed properly as an issue beyond

just entitlement to impairment rating income benefits, then Labor Code

section 410.255 would require the DWC be made a party under a “substantial

evidence review” standard. This Court of Appeals explained the two judicial

review avenues under Chapter 410 of the Texas Labor Code:19

Section 410.301 HN4 provides that suits "regarding compensability or

eligibility for or the amount of income or death benefits" are governed

by modified de novo review. Tex. Lab. Code Ann. § 410.301. Substantial-

evidence review is reserved as the default for any other type of

reviewable appeals panel decision. See id. § 410.255.

To anticipate the DWC’s response that 410.255 would mandate venue in

Travis County—such is not accurate because 410.252 controls judicial review

and requires venue in the county of the worker’s residence under either

subchapter F (410.255) or subchapter G (410.301) of Chapter 410 of the

Texas Labor Code. So even if Labor Code section 410.255 applies to network

19Tex. Prop. & Cas. Guar. Ass'n v. Nat'l Am. Ins. Co., 208 S.W.3d 523, 533 (Tex.

App.--Austin 2006, pet. denied).

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

issues and then Texas Government Code section 2001.171 et seq. applies in

this case (though such assertion is definitely contested), venue is still

mandatory in Dallas County. Under Texas Government Code section

2001.176(b)(1) a petition must be filed in Travis County “unless provided

otherwise by statute.” Travis County is the default if the specific statute

does not provide otherwise—here it provides local venue.

Texas Labor Code section 410.252(b)(1) statutorily mandates venue in

the worker’s county of residence (Dallas County) at the time of the injury.

This is consistent with the administrative hearings in this matter being held in

the local DWC field office within 75 miles of the worker’s residence under

Texas Labor Code section 410.005. Worth noting is section 410.252 precedes

section 410.255, and both of these sections are part of Subchapter F of

Chapter 410. Any attempt to say section 410.252 does not apply to section

410.255 would be contrary to the express language of the statute.

This Court of Appeals previously addressed whether the backup

mandatory Travis County venue under the Guaranty Act controlled over the

required mandatory county of an injured worker’s residence under the Texas

Workers’ Compensation Act. See respectively, TEX. INS. CODE § 462.017(b) and

TEX. LAB. CODE § 410.252(b). See TEX. LAB. CODE § 410.252(b)(1) (party

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

bringing suit must file petition in county where employee resided at time of

injury); Campos v. Texas Prop. & Cas. Ins. Guar. Ass'n, 282 S.W.3d 226, 230 (Tex.

App.—Austin 2009, no pet.). In Campos v. TPCIGA, this Court properly

determined that the mandatory venue under Texas Labor Code

§410.252(b)(1) the Texas Workers’ Compensation Act trumped the conflict

with the Insurance Code. This Court determined:20

In our view, the specific venue provision of the Workers'

Compensation Act controls over the general venue provision of the

Guaranty Act.

The DWC is a proper party under Texas Labor Code Section 410.255.

4. Declaratory Relief is Proper & Needed When the DWC Misapplies

the Law and Violates the Law.

The DWC and the Commissioner appear to allege declaratory relief is not

available at all against the DWC and the Commissioner. All parties involved

will be affected by the declaratory judgment action and to be of any force and

effect, the UDJA unequivocally mandates:

(a) When declaratory relief is sought, all persons who have or claim any

interest that would be affected by the declaration must be made parties.

A declaration does not prejudice the rights of a person not a party to the

proceeding.

20Campos v. Texas Prop. & Cas. Ins. Guar. Ass'n, 282 S.W.3d 226, 231 (Tex.

App.—Austin 2009, no pet.)

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

TEX. CIV. P. & REM. CODE § 37.006. See Brooks v. Northglen Ass'n, 141 S.W.3d

158, 163 (Tex. 2004) (The Texas Supreme Court noted that no fault and no

prejudice lies with non-parties to the UDJA). If the Appellees, the DWC and

the Commissioner, were not parties, then they would not be bound to follow

the District Court’s declarations.

5. The DWC and Commissioner Previously Have Been Determined

Proper Parties in UDJA Actions

This Court of Appeals recently emphasized that a declaratory judgment

action is allowed for Texas Labor Code proper statutory enforcement matters

and are proper where a party “asked the court to declare its rights and status

under certain statutory provisions” involving the Texas Workers’

Compensation Act. Nat'l Am. Ins. Co. and TDI-DWC and Commissioner Bordelon

in his official capacity v. Tex. Prop. & Cas. Ins. Guar. Ass'n, No. 03-09-00680-CV,

2013 WL 4817637, 2013 Tex. App. LEXIS 10865 (Tex. App.--Austin Aug. 28,

2013, no pet.) (mem. op.). This Court rejected the DWC’s and the

Commissioner’s position that the trial court did not have jurisdiction to

construe the statutes in issue and determined in part that “the trial court had

jurisdiction to construe the statutes in issue.” Id. The statutes in issue all

were sections of the Texas Workers’ Compensation Act under the Texas Labor

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Code. The parties were an insurance carrier, TPCIGA acting on behalf of an

insurance carrier in receivership, and the DWC and the Commissioner. This

Court should also allow a declaratory judgment to proceed to enforce

compliance with the statutory terms. As the 3rd Court of Appeals explained in

upholding the right to declaratory relief in the Nat’l American case:21

A declaratory judgment action is proper only if a justiciable controversy

exists as to the rights and status of the parties and the controversy will be

resolved by the declaration sought. Bonham State Bank v. Beadle, 907

S.W.2d 465, 467 (Tex. 1995).

A clear controversy exists with regards to the DWC and the Commissioner’s

proper application of the statutory requirements and that workers should

have spinal fusion surgeries occurring before maximum medical improvement

included in any assigned impairment ratings.

6. Insurance Carriers Are Allowed Declaratory Actions Against the

TWCC and the DWC (now the DWC)—Why Not Injured Workers?

In 2003, this Court of Appeals allowed one insurance carrier to bring a

declaratory judgment action against the injured worker and the Texas

Workers’ Compensation Commission, the predecessor to the DWC, after

having exhausted administrative remedies was proper under the Uniform

Declaratory Judgment Act. Tex. Workers' Compensation Ins. Fund v. Tex.

21 Id.

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Workers' Compensation Comm'n & Watts, 124 S.W.3d 813, 820 (Tex. App.--

Austin 2003, pet. denied). This Court of Appeals in TWCIF v. TWCC allowed a

declaratory action but agreed with the TWCC’s statutory interpretation.

In 2006, this Court of Appeals in Lumbermens upheld the jurisdiction of

the district court under the Uniform Declaratory Judgments Act, UDJA after an

analogous matter arising out of a Chapter 410 proceeding. Texas Dep. of Ins.,

Div. of Workers’ Compensation v. Lumbermens Mut. Cas. Co., 212 S.W.3d 870

(Tex. App.—Austin 2006, pet. denied). The Lumbermens court stated:

The UDJA does not confer jurisdiction on trial courts; rather, it is merely a

procedural device for deciding cases already within a court's jurisdiction.

...

Accordingly, we hold that the trial court had jurisdiction under the UDJA

and overrule the Division's second issue.

Lumbermens at 875. The authority clearly exists to use the UDJA, specifically

§37.004, to pursue a declaration of statutory interpretation even when a rule

violates the Texas Workers’ Compensation Act for cases which administrative

remedies have been exhausted under Chapter 410.

The 3rd Court in the Lumbermens case, TWCIF v TWCC, and the Nat’l Amer.

and TDI-DWC v. TPCIGA, simply allowed and upheld declaratory judgments

with the DWC as a proper party. In each case including the case decided last

year, the DWC objected to the declaratory actions; however, the 3rd Court of

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Appeals allowed each declaratory action to proceed and determined the

meaning of the statutes in question. These three declaratory actions

determined statutory rights in matters like this one arising after exhaustion of

administrative remedies under Chapter 410 of the Texas Labor Code. This is

a case challenging the state agency and the insurance carrier’s improper

application, interpretation, and lack of compliance and enforcement of state

laws. When the Legislature declares a 6.25% state sales tax rate, a state

agency could not try to declare and misapply a 7% state sales tax. When the

Legislature declares complete and accurate and detailed written notice be

provided to workers, a state agency and its official head cannot simply allow a

website link to be provided.

The TWCIF v. TWCC and the Lumbermens cases were brought as a

declaratory judgment action in conjunction with challenging a final decision

from the Chapter 410 dispute process in the Texas Labor Code. Likewise, the

Nat’l Amer. v. TPCIGA also was brought as a declaratory judgment action

subsequent to a final Chapter 410 contested case hearing yet in a separate

proceeding. These cases illustrate the need for an actual controversy and that

Courts are allowed to address declaratory judgments on matters within their

jurisdiction after administrative remedies have been exhausted. Unlike those

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

cases, the DWC intervened in this matter.

7. The Predecessor to Texas Mutual, the Texas Workers’

Compensation Insurance Fund, Pursued an Allowed Declaratory

Action Against the TWCC and the DWC.

In 2003, this Court of Appeals allowed one insurance carrier, the

predecessor to Texas Mutual, to bring a declaratory judgment action against

the injured worker and the Texas Workers’ Compensation Commission, the

predecessor to the DWC, after having exhausted administrative remedies in a

dispute against one worker and that such was allowed under the Uniform

Declaratory Judgment Act. Tex. Workers' Compensation Ins. Fund v. Tex.

Workers' Compensation Comm'n & Watts, 124 S.W.3d 813, 820 (Tex. App.--

Austin 2003, pet. denied). The 3rd Court of Appeals in TWCIF v. TWCC allowed

a declaratory action but agreed with the TWCC’s statutory interpretation.

This Court properly determined the legal dispute over the meaning of an

"issue," as used in Tex. Lab. Code §410.204(a), refers to the disputed

determinations made by the hearing officer in rendering the final decision.

Clearly, the state agency was a necessary party to the declaratory action.

Texas Mutual has sought declaratory judgments under the Texas

Workers’ Compensation Act in other matters in which Texas Mutual won the

declaration, and this Court of Appeals determined the DWC’s plea to the

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

jurisdiction was granted in error. Texas Mutual Insurance Co. v. Texas

Department of Insurance, Division of Workers' Compensation, 214 S.W.3d 613

(Tex. App.--Austin 2006, no pet.).

Texas Mutual and the DWC (its predecessor the TWCC) successfully

sought declaratory judgments against a chiropractor for the proper

application of the Texas Labor Code (the Texas Workers’ Compensation Act).

Howell v. TWCC & Texas Mutual, 143 S.W.3d 416, 429 (Tex. App. --Austin 2004,

pet. denied). , and this Court of Appeals explained:

Unlike an advisory opinion, these declarations did not concern

hypothetical claims or abstract questions of law. The declarations went to

the heart of the controversy between the parties. . . . A trial court has the

discretion to enter a declaratory judgment as long as it will serve a useful

purpose or will terminate the controversy between the parties.

In prior legal brief, 2006 TX App. Ct. Briefs LEXIS 276 , Texas Mutual

successfully asserted a need for declaratory judgment relief against the DWC.

Tex. Mut. Ins. Co. v. Tex. Dept. of Ins., Div. of Workers' Compensation, 214 S.W.3d

613, 619 (Tex. App.—Austin 2006, no pet.) Texas Mutual argued entitlement

to a declaration and that the attached final DWC contested case hearing

officer’s decision confirmed this (emphasis added):

First, the attached decision confirms that Texas Mutual's declaratory

judgment action challenging the validity of Rule 110.1 is ripe. Texas

Mutual seeks declaratory judgment that the Rule cannot validly extend a

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

policy past the date that the statute would require. . . .

Texas Mutual is entitled to appeal the attached decision. TEX. LABOR

CODE § 410.252. But that potential appeal is not the exclusive remedy

available to Texas Mutual. Only by a declaratory judgment action such

as the one in the case at bar can Texas Mutual resolve the scope of the

Division's statutory authority over cancellation, non-renewal, and

offers of renewal not accepted. The declaratory judgment action would

thus be proper even if there were also an APA appeal of a particular

order

8. Prior Declaratory Judgment over Impairment Ratings and AMA

Guides

In 2006, this Court of Appeals in Lumbermens upheld the jurisdiction of

the district court under the Uniform Declaratory Judgments Act, UDJA, after

an analogous matter arising out of a Chapter 410 proceeding. Texas Dep. of

Ins., Div. of Workers’ Compensation v. Lumbermens Mut. Cas. Co., 212 S.W.3d

870 (Tex. App.—Austin 2006, pet. denied). The Lumbermens court stated:

The UDJA does not confer jurisdiction on trial courts; rather, it is merely a

procedural device for deciding cases already within a court's jurisdiction.

...

Accordingly, we hold that the trial court had jurisdiction under the UDJA

and overrule the Division's second issue.

Lumbermens at 875. The authority clearly exists to use the UDJA, specifically

§37.004, to pursue a declaration of statutory interpretation even when a rule

or mere agency position violates the Texas Workers’ Compensation Act.

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Mr. Morales has in part requested a declaratory judgment ruling that

spine impairment ratings under the Texas Workers’ Compensation Act must

take into consideration spinal surgeries and the effects of spinal surgeries

when the surgeries occur prior to maximum medical improvement, MMI,

being reached. This legal question of whether spinal surgery occurring

before MMI must be considered in assigning an impairment rating was

expressly left open by this Court in Severiano DeLeon v. Royal Indemnity

Company, 396 S.W.3d 597 (Tex. App.--Austin 2010) rev’d on other grounds

Severiano DeLeon v. Royal Indem. Co., 396 S.W.3d 527 (Tex. 2012).

9. Lumbermens Was Wrong to Try to Exclude Consideration of Pre-

MMI Spinal Surgeries as the DeLeon decision determined that Pre-

MMI Spinal Surgeries Question Would Be Left Open.

Insurance Carriers and the DWC and the DWC Commissioner have used the

Lumbermens dicta inappropriately to try to exclude all spinal surgeries, even

pre-MMI, from consideration (and this is evidently taught to a number of

designated doctors).22 Subsequent to Lumbermens, this Court’s DeLeon

decision expressly distanced itself from this dicta, with this Court noting that

it would leave open and not reach Mr. DeLeon’s arguments including

22Tex. Dep’t of Ins. v. Lumbermens Mut. Cas. Co., 212 S.W.3d 870 (Tex. App.—

Austin 2006, pet. denied)

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

considering pre-MMI surgery, this Court stated: 23

Therefore, we need not reach the issue of whether pre-MMI

surgery may be taken into account under the AMA Guides when

assessing an impairment rating for a spine impairment.

A major flaw from allowing the DWC and insurance carriers to apply the

dicta from the Lumbermens decision was created in part because no worker

was in that appeal to point out the pertinent provisions of the AMA Guides,

was from looking at one sentence of the AMA Guides in isolation and not with

respect to Table 70 which provides express “specific disorder” categories for

“previous spine operations,” the MMI date, or even the definition of

“impairment” under the WC Act. Attached as Appendix No. 3 are the

applicable pages from the AMA Guides to the Evaluation of Permanent

Impairment, 4th Edition, which is allowed to be used by the Legislature under

Texas Labor Code Section 408.124(c).

Under Table 70, Mr. Morales is entitled to a range of categories, and, as

discussed below, the Range of Motion model should be used if Table 70 does

not contain a specific rating.

The line taken out of context from the AMA Guides in the Lumbermens

decision to somehow, and somewhat inexplicably, exclude spinal fusion

23Severiano DeLeon v. Royal Indemnity Company, 396 S.W.3d 597 (Tex. App.--

Austin 2010) rev’d on other grounds Severiano DeLeon v. Royal Indem. Co., 396

S.W.3d 527 (Tex. 2012)

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

surgeries from impairment ratings is:

With the Injury Model, surgery to treat an impairment does not modify

the original impairment estimate, which remains the same in spite of

any improvement or failure to improve with regards to symptoms that

follow the surgery and irrespective of whether the patient has a

favorable or unfavorable response to treatment. [Emphasis added, AMA

Guides, p. 100, left column, paragraph 3].

Under Texas Labor Code Sections 401.011(23) & (24) the Legislature’s

definitions are as follows:

(23) “Impairment” means any anatomic or functional abnormality or

loss existing after maximum medical improvement that results from a

compensable injury and is reasonably presumed to be permanent.

(24) “Impairment rating” means the percentage of permanent

impairment of the whole body resulting from a compensable injury.

The “impairment” must be from an examination done after MMI has been

reached and be based upon the doctor’s evaluation of the injured worker’s

condition after MMI. 24 So surgery occurring after MMI, at least under the

law, would not affect the original impairment rating, but surgery occurring

before an impairment is reached is certainly included.

In the Molder decision, the El Paso Court properly emphasized that MMI

must be reached before an impairment rating may be evaluated, and the

impairment rating is based on the employee’s condition as of the date of MMI.

In Molder, the Court of Appeals explained DWC Rule 130.1 and left the

24 TEX. LAB. CODE § 408.123(a).

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

medical judgment to the doctor to include the surgery (emphasis added):25

Rule 130.1(c)(3) requires that assignment of an impairment rating for

the current compensable injury be based on the injured employee's

condition as of the MMI date considering the medical record and the

certifying examination. 28 Tex. Admin. Code § 130.1(c)(3). . . .

An “impairment” is permanent and not determined until after MMI is

reached and clearly not the same as an “injury” under the AMA Guides.

Surgery to treat an “impairment” is legally different from surgery to treat an

“injury.” In discussing the impact of surgery with regards to MMI, the DWC

Appeals Panel explained in DWC Appeals Panel Decision No. 080375, May 15,

2008, 2008 WL 2233469:

28 TEX. ADMIN. CODE § 130.1(c)(3) (Rule 130.1(c)(3)) provides that

the assignment of an IR for the current compensable injury shall be

based on the injured employee's condition as of the MMI date

considering the medical record and the certifying examination. . . . In

response to public comment on Rule 130.1, the Division, in the

preamble, noted that in the situations where the claimant reaches MMI

clinically, rather than with the expiration of 104 weeks or the extended

date in the event of spinal surgery, future changes in the injured

worker's condition may cause the MMI date to change and that “[i]n the

event the MMI date is changed due to a post-MMI change in the injured

employee's conditions, there should be a re-evaluation of the IR as of

the new MMI date.”

25Tex. Builders Ins. Co. v. Molder, 311 S.W.3d 513 (Tex. App. El Paso 2009, no

pet.)

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Surgery after MMI perhaps does not legally affect the impairment rating, but

certainly pre-MMI surgery does. In this matter, Mr. Morales had a multi-level

pre-MMI fusion surgery to treat his “injury” not surgery to treat his

“impairment,” which would refer to his post-MMI and post-surgery

permanent condition. The Arkansas Workers’ Compensation Commission

properly explained such in an administrative decision:

. . . a single level fusion was not geared to treat an impairment, but

rather an injury, a recurrent herniated nucleus pulposus lumbar 4-5

right.

Camp v. Greene County Tech. et. al, decided October 17, 2008, 2008 WL

4686198 (Ark.Work.Comp.Com.)(allowing rating after and considering

surgery but under Arkansas law apportioning out prior impairments). The no

inclusion of multi-level fusion surgery by the designated doctor results from

the erroneous interpretation applied from Lumbermens and clearly left open

in DeLeon likely because such misinterpretation violates and contradicts the

AMA Guides requirements, DWC rules, and the WC Act.

Further under the Range of Motion model used by the physician to rate

the multi-level fusion of Mr. Morales, the AMA Guides expressly provide for

ratings of surgical fusions when Table 70 cannot be used or to help decide a

category under Table 75 of the AMA Guides, which starts with a 10% rating

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

for a one level cervical fusion—the DWC’s designated doctor here only

assigned a 5% rating for the cervical spine, when Mr. Morales undisputed

underwent a four level cervical fusion. The DWC’s enforced rating is clearly

erroneous and legally invalid.

10. The DWC and the Commissioner Relied Below on Inapplicable and

Distinguishable Decisions

The Appellees relied upon easily distinguishable cases. In the District

Court, the Appellees relied in part upon Beacon Nat 'I Ins. Co. v. Montemayor,

86 S.W.3d 260, 267 (Tex. App.-Austin 2002, no pet.). In Beacon v. Montemayor,

the 3rd Court of Appeals explained:

The UDJA waives this immunity when a party seeks a court's construction

of a statute or rule. City of LaPorte v. Barfield, 898 S.W.2d 288, 297, 38

Tex. Sup. Ct. J. 533 (Tex. 1995). Beacon's action does not seek

construction of a statute or rule; . . . .

This shows that the party seeking the declaration in Beacon did not seek

proper statutory construction or clarification unlike the declaratory requests

here.

Further, the Appellees below cited to Kuntz v. Khan, No. 03-10-00 160-CV,

2011 Tex. App. LEXIS 446, 2011 WL 182882,(Tex. App.--Austin 2011, no

pet.)(mem. op.). Kuntz v. Khan rejected a declaratory judgment because “the

effect of a favorable ruling in either lawsuit would be the same—if Khan

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

prevails in either suit, the result would be a determination that the

Department has no authority to regulate eyebrow threading.” Kuntz v Khan

addressed a suit directly against and enforceable against the state agency

versus here where the DWC and the Commissioner are not necessary parties

to a judicial review action under Chapter 410.301 without the legal

declaratory relief sought.

Likewise the DWC below relied upon Young Chevrolet, Inc. v. Tex. Motor

Vehicle Bd., 974 S.W.2d 906,911 (Tex. App.--Austin 1998, pet. denied), which

also involved direct actions against the state regulatory agency as a party

creating enforceability against the agency without the need for a declaration.

The DWC and DWC Commissioner are not parties to mere judicial review

actions under Texas Labor Code Section 410.301-302.

Kuntz v Khan and other cases involving direct judicial challenges to a

state agency are in direct contrast here where the DWC is not a mandatory

party under Chapter 410 disputes except under Section 410.255, and the only

method to enforce proper statutory construction and enforcement against the

DWC and the Commissioner is, simply and legally, to make the DWC and the

Commissioner a party, in fact a necessary party for legal declarations of

statutory meanings, rights, applications, and proper enforcement especially

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

where violations of the law are alleged.

To bind the regulatory state agency, the DWC and the Commissioner, in

his official capacity, are necessary and proper parties when declaratory relief

is sought to ensure compliance and that state officials do not act ultra vires.

11. The District Court Has Jurisdiction over all the Claims

The Appellant has exhausted his administrative remedies before the DWC

and the Commissioner with an unfavorable ruling based upon statutory

construction and misapplication and refusal to comply with the law by the

Appellees. When reviewing a plea to the jurisdiction, the pleadings are

construed in favor of the non-movant. See Tex. Dep't of Parks & Wildlife v.

Miranda, 133 S.W.3d 217, 226 (Tex.2004); Tex. Ass'n of Bus. v. Tex. Air Control

Bd., 852 S.W.2d 440, 446 (Tex. 1993). “The general test for standing in Texas

requires that there (a) shall be a real controversy between the parties, which

(b) will be actually determined by the judicial declaration sought.” Tex. Ass'n of

Bus., 852 S.W.2d at 446.

To prevail, the party asserting the plea to the jurisdiction must show

that even if all the allegations in the plaintiff's pleadings are taken as true,

there is an incurable jurisdictional defect apparent from the face of the

pleadings, rendering it impossible for the non-movant’s claims to confer

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

jurisdiction on the trial court. Texas State Employees Union/CWA Local 6184 v.

Texas Workforce Comm'n, 16 S.W.3d 61, 65 (Tex. App.-Austin 2000, no pet.). A

court deciding a plea to the jurisdiction is not required to look solely to the

pleadings, but may consider evidence relevant to the jurisdictional issue and

must do so when necessary to resolve the jurisdictional issues which have

been raised. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554-55 (Tex. 2000).

A court should construe the pleadings in the non-movant’s favor and look to

the non-movant's intent. Texas Ass'n of Business v. Texas Air Control Bd., 852

S.W.2d 440 at 446 (Tex. 1993). A court does not address the merits of the

case in a plea to the jurisdiction; instead, the movant must establish why the

merits of the non-movant’s claims should not be reached. Bland Indep. Sch.

Dist., 34 S.W.3d at 554. The DWC and the Commissioner have not shown that

an injured worker’s suit to properly enforce compliance with statutory terms

falls outside the jurisdiction of the District Court because administrative

remedies have been exhausted, and the pleadings illustrate why the DWC and

the Commissioner must be parties to be able to enforce any declarations

against the state agency and its administrative head when the agency fails to

properly follow the Legislature’s laws and acts in violation of the state laws.

12. Resolution of the Controversy with Declaratory Action

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

The judicial declaration sought by Rosendo Morales will help determine

and likely resolve the underlying controversy concerning the proper inclusion

of spinal fusion surgeries in the impairment ratings assigned to injured

workers.

13. Texas Courts are “Duty-Bound” to Construe Statutes

Texas District Courts are inherently vested with the power to construe

statutes, and Courts are not bound by an agencies interpretation or

application, especially if in error. If a declaratory judgment action terminates

the uncertainty or controversy giving rise to the lawsuit, the District Court is

duty-bound to declare the rights of the parties as to the matters on which the

parties join issue. Spawglass Constr. Corp. v. City of Houston, 974 S.W.2d 876,

878 (Tex. App.--Houston [14th Dist.] 1998, pet. denied); Calvert v. Employees

Ret. Sys. of Tex., 648 S.W.2d 418, 419 (Tex. App.--Austin 1983, writ ref'd n.r.e.).

Without the DWC and the Commissioner, the enforcement of the statutes

proper application would not be available to a judge.

14. Live Justiciable Controversy Exists

Appellant also has clearly asserted that the DWC and the Commissioner

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

interpretation and application of the laws in question violate the statutes of

Texas and the statutory responsibility, authority and limits placed upon the

DWC and the Commissioner and that statutory interpretation and validity of

application of the Texas Workers’ Compensation Act are in dispute. A

justiciable controversy regarding whether a state agency or officer has acted

beyond statutory authority provides a jurisdictional basis for a UDJA action

seeking construction of that statutory authority. This type of UDJA action does

not implicate sovereign immunity. Cobb v. Harrington, 144 Tex. 360, 190

S.W.2d 709, 712 (1945); see also Texas Natural Res. Conservation Comm'n v. IT-

Davy, 74 S.W.3d 849, 855 (Tex. 2002) (“Private parties may seek declaratory

relief against state officials who allegedly act without legal or statutory

authority.”). A suit for declaratory relief is not a suit against the State because

it does not seek to impose liability or money damages against the state agency.

IT-Davy, 74 S.W.3d at 853.

15. Declaratory Actions Allowed Even After Prior Final Judgments

under Chapter 410 of the Texas Labor Code to Determine Statutory

Rights

This Court of Appeals recently allowed a declaratory judgment action

against the DWC, the Commissioner, and an insurance carrier to determine

statutory rights after a previous final judgment under a Texas Labor Code

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Chapter 410 dispute. Nat'l Am. Ins. Co. v. Tex. Prop. & Cas. Ins. Guar. Ass'n for

Paula Ins. Co., 2013 Tex. App. LEXIS 10865 (Tex. App.--Austin Aug. 28, 2013,

no pet.). This Court, in allowing the declaratory action to proceed, explained

that it was not a collateral attack on the prior judgment because: “the

controversy underlying the Guaranty Association's declaratory judgment

action concerns NAIC's rights vis-a-vis the Guaranty Association under section

410.033 of the Labor Code and the Guaranty Act. The declaratory judgment

action regarding reimbursement thus involves the existence of a statutory

right . . . .” Clearly, declaratory actions over statutory rights and the proper

enforcement of those rights under the Labor Code and the Code of Criminal

Procedure are allowed where, as here, a live controversy exists and

administrative remedies have been exhausted.

Further, the state agency is a necessary party when the authority of the

state agency’s actions and rules are questioned as violating the will of the

Legislature. The DWC and the Commissioner being joined in this matter

makes this declaratory action proper so as to be enforced against the DWC

and the Commissioner to not violate the statutes. This Court previously

explained:

The UDJA grants any litigant whose rights are affected by a statute the

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

opportunity to obtain a declaration of those rights under the statute

and requires that all relevant parties be joined in any declaratory

judgment suit. Tex. Civ. Prac. & Rem. Code Ann. §§ 37.004, .006 (West

1997); City of Waco v. Texas Nat. Res. Comm'n, 83 S.W.3d 169, 179 (Tex.

App.-Austin 2002, pet. denied) (UDJA claim not barred by sovereign

immunity because UDJA serves to clarify rights already guaranteed by

legislature). Therefore, when the State is a necessary party to a statutory

cause of action, such as a UDJA action for interpretation of a statute,

sovereign immunity is expressly waived because, were the State not

joined, the right to a declaration would have no practical effect. See City

of La Porte v. Barfield, 898 S.W.2d 288, 297 (Tex.1995) (construing Texas

Educ. Agency v. Leeper, 893 S.W.2d 432, 446 (Tex.1994)); see also Beacon

Nat'l Ins. Co. v. Montemayor, 86 S.W.3d 260, 267 (Tex. App.--Austin 2002, no

pet.) (“The UDJA waives [sovereign] immunity when a party seeks a court's

construction of a statute or rule.”); Star Houston v. Texas Dep't of Transp.,

957 S.W.2d 102, 111 (Tex. App.--Austin 1997, pet. denied) (holding that

sovereign immunity did not bar declaratory judgment determining whether

agency has wrongfully construed a statute); City of Austin, 728 S.W.2d at

910-11 (holding UDJA action brought against government entity to

determine scope of entity's authority not barred by sovereign immunity). A

UDJA action exists whether or not further relief can be obtained.

Leeper, 893 S.W.2d at 446. Thus, when a party brings a declaratory

judgment action to interpret an agency's statutory authority, immunity

from suit is waived by the UDJA. This does not mean, however, that

immunity from damages is waived except as to a declaration of the parties'

rights and the potential award of attorney's fees. UDJA actions for statutory

interpretation do not implicate the policy concerns of protecting the

legislature's policy-making discretion and avoiding raids on the public

treasury embodied in the sovereign immunity doctrine-rather, they serve to

clarify the rules and requirements imposed by the legislature on the

administrative agencies.

(Emphasis added.) Texas Mun. Power Agency v. Public Utility Com'n, 100

S.W.3d 510, 515-516 (Tex. App.--Austin 2003, pet. denied) (cited to favorably

by Texas Mun. Power Agency v. Public Utility Com'n of Texas, 253 S.W.3d 184,

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

189 (Tex. 2007). Appellant does not seek damages from the DWC or the

Commissioner, but does seek to clarify and to enforce the proper compliance

with the statutory requirements on the administrative agency and its head

official who are violating the law. The DWC should not be allowed to

continue to improperly interpret and fail to enforce the Texas Labor Code.

16. Declaratory Actions under the Texas Workers’

Compensation Act

The initial challenge to the 1989 Texas Workers’ Compensation Act in

Garcia was primarily a declaratory judgment action.26 The Texas Supreme

Court reiterated as to the declaratory action against the then TWCC and the

Executive Director looking at the terms and Constitutionality of the 1989

Act:27

Standing, which is a necessary component of subject matter jurisdiction,

requires a) a real controversy between the parties, which b) will be

actually determined by the judicial declaration sought.

The DWC and the Commissioner’s actions ignore the statutory requirements

to be applied against insurance carriers and employers and in favor of

workers and health care providers.

Texas Workers' Compensation Commission v. Garcia, 893 S.W.2d 504, 517-518

(Tex. 1995).

27 Garcia at 513.

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Appellant has exhausted all applicable administrative remedies under

Chapter 410 of the Texas Labor Code. A UDJA claim is sui generis; and, all

other things being equal, the district court's subject matter jurisdiction over it

exists independently of any administrative remedies. Texas Liquor Control Bd.

v. Canyon Creek Land Corp., 456 S.W.2d 891, 895 (Tex.1970); Cobb, 190 S.W.2d

at 713; see Texas Mun. Power Agency v. Public Util. Comm'n, 100 S.W.3d 510,

520 (Tex. App.--Austin 2003, pet. denied). Even if the UDJA claims in this

matter could not be brought independently, the claims certainly could be

brought within the jurisdiction created by the exhausted administrative

dispute.

The Third Court of Appeals in Mid-Century Insurance Company v. Texas

Workers’ Compensation Commission, 187 S.W.3d 754 (Tex. App.—Austin 2006,

no pet.), determined that a rule exceeded the statutory authority of the DWC

and noted that:

Mid-Century Insurance Company (Mid-Century) sought a declaration that

this rule exceeds the Division's statutory powers and is thus invalid. See

Tex. Civ. Prac. & Rem. Code Ann. § 37.004 (West 1997).

Id. at 756. Without declaratory actions, the statutes could be ignored by the

DWC and the Commissioner with enforcement only on a piece-meal basis by

litigants who are able to challenge improper agency actions.

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Whether the District Court, or any Court, ultimately rules in Appellant’s

favor or not—the District Court certainly can declare rights of the interested

parties, an injured worker and an insurance carrier, directly affected by the

applicable state agency and agency head, under the statutes as a matter of law

especially where administrative remedies have been exhausted. See Tex.

Workers' Compensation Ins. Fund v. Tex. Workers' Compensation Comm'n, 124

S.W.3d 813 (Tex. App.--Austin 2003, pet. denied).

17. ENFORCABILITY: UDJA is Especially Necessary where the

DWC Refuses to Recognize Chapter 410 District Court Rulings as

Legally Binding

The DWC’s position on individual Chapter 410 judicial review cases is that

mere district court reversals of a final DWC decision under Chapter 410 of the

Texas Labor Code are not binding as to the DWC’s interpretation even if it is

improper as to any other case. The DWC Appeals Panel has reiterated:28

that the decision of a [city 1] District Court had no effect "beyond its

factual context" and did not bind the Texas Workers' Compensation

Commission (Commission) as a matter of stare decisis in the

Commission's interpretation of the 1989 Act.

This shows the Catch-22 that the DWC places all parties under that the DWC

and Commissioner’s disregard for a court decision beyond “its factual content”

28DWC APPEAL NO. 050140, 2005 TX Wrk. Comp. LEXIS 57 (decided March

14, 2005)

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

unless, as here, the DWC and Commissioner are made parties or intervene.

This matter is of significant public importance and concerns the very line

drawn as to the entry into course and scope of employment by Texas peace

officers.

Only after the appellate decision upholding declaratory judgment in

Lumbermens become final did the DWC Appeals Panel follow the declaration:29

Lumbermens Mutual Casualty Company filed suit against the Division

seeking in part a declaratory judgment that the Advisories are

inconsistent with 28 TEX. ADMIN. CODE § 130.1 (Rule 130.1) and that

their issuance and application is outside the Division's statutory

authority.

The Advisories have been declared invalid and their application an ultra

vires act. Lumbermens, supra. Therefore, the adoption of an IR that is

based on the Advisories is legal error and must be reversed. Prior

Appeals Panel decisions applying the Advisories to rate impairment for

spinal fusion surgery have been overruled by the Lumbermens case.

The DWC will follow a declaratory judgment as to statutory rights and its

prior errors, but will not apply a District Court’s reversal of a single workers’

compensation dispute decision beyond the single workers’ compensation

claim. The DWC’s own decisions signify why declaratory judgments are

allowed and clearly necessary in this matter.

29DWC Appeals Panel No. 071023-s, decided July 23, 2007, 2007 TX Wrk.

Comp. LEXIS 54.

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

Here are several more final DWC decisions from over the years refusing

to follow the law in District Court cases:

(1) DWC APPEAL NO. 94994, 1994 TX Wrk. Comp. LEXIS 6081,

September 9, 1994: “. . . nor is the Commission joined as a party. The

decision is without effect, therefore, beyond its factual context, and

certainly the Commission is not bound by such a general judgment

of a district court, through stare decisis, in its interpretation of the

Section 409.021.” (Emphasis added.)

(2) DWC APPEAL NO. 951802, 1995 TX Wrk. Comp. LEXIS 4964,

December 13, 1995, emphasizing: “We do not consider the Appeals

Panel bound by this district court opinion in a case involving other

parties and in which the commission did not participate.”

(3) DWC Appeal No. 990005, 1999 TX Wrk. Comp. LEXIS 3029,

decided February 19, 1999: “The Appeals Panel is not bound by a

district court opinion in a case involving other parties and in which

the Commission did not participate. Texas Workers' Compensation

Commission Appeal No 94994, decided September 9, 1994.” (Emphasis

added.)

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

The DWC and the Commissioner should be a party to a proceeding in which

legal determinations are sought to bind the DWC and the Commissioner to

follow the law. This underlying legal questions have not been declared and

determined and are not yet up on appeal, but the declarations sought under

the statutes are critical to resolving this matter.

18. Declaratory Judgment Prevents Continued Erroneous

Statutory Interpretation by the DWC and the Commissioner

In the workers’ compensation area, after final administrative decisions as

here, both insurance carriers and injured workers’ have sought declaratory

rulings concerning the validity and applicability of the DWC and the

Commissioner statutes and rules. See Mid-Century, supra; Fulton v. Associated

Indemnity Company, 46 S.W.3d 364 (Tex. App—Austin 2002, pet. denied);

Houston General Insurance Co. v. Association Casualty Insurance Co., 977

S.W.2d 634 (Tex. App.—Tyler, no pet.). Venue of the main action shall

establish venue of a counterclaim, cross claim, or third-party claim properly

joined under the Texas Rules of Civil Procedure or any applicable statute. TEX.

CIV. PRAC. & REM. CODE §5.062(a); Howell v. Texas Workers' Compensation

Com'n, 143 S.W.3d 416, 433 (Tex. App.--Austin 2004, pet. denied). A

declaratory judgment simply declares the rights, status, or other legal

relations of the parties; and under Tex. Civ. Prac. & Rem. Code §37.003(a), (b),

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

a trial court has the “power to declare rights, status, and other legal relations

whether or not further relief is or could be claimed,” and declaration has the

“force and effect of a final judgment or decree”. Howell at 432. Without the

DWC and the Commissioner present, Appellant’s pleadings and claims for

relief would have little effect if not arguably result in an inability to be

enforced against the DWC and the Commissioner at all if in fact the DWC and

the Commissioner are not a party.

CONCLUSION

This Court should allow Rosendo Morales to proceed with the

declaratory judgment claim and keep as parties both the DWC and the

Commissioner, in his official capacity. The jurisdiction exists due to the live

controversy, exhaustion of administrative remedies, and the state agency and

state official are necessary parties for proper enforceability of the statutes and

to ensure proper compliance with statutory terms alleged to be violated.

Otherwise only the few who continue to fight will have a chance for justice on

a piece by piece basis and the harm may occur again and again. The purpose

of the Declaratory Judgment Act is to make the laws clear to all affected and to

make sure the laws are properly applied and not violated by the state agency

and the head of the state agency. The Judiciary oversees the Executive Branch

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

both to uphold its proper actions but to also to protect Texans’ rights to make

sure the laws are properly applied and correctly interpreted and rightly

enforced.

PRAYER

Rosendo Morales, Appellant, respectfully prays and ask that this Court

reverse the ruling of the District Court on the plea to the jurisdiction granted

to the DWC and the Commissioner, and this Court should not allow the

dismissal of the DWC and the Commissioner, and that this Court determine

that the District Court has jurisdiction to determine the declaratory judgment

matters sought by Appellant including against the DWC and the

Commissioner. Appellant ask for all other relief to which he is entitled

including costs of court.

Respectfully,

/s/ Brad McClellan

Bradley Dean McClellan

State Bar No. 13395980

Of Counsel, Law Offices of Richard Pena, P.C.

Richard Pena

Law Offices of Richard Pena, P.C

State Bar No. 00000073

1701 Directors Blvd., Suite 110

Austin, Texas 78744

Brad.McClellan@yahoo.com

(512) 327-6884 telephone

(512) 327-8354 facsimile

Attorney for Appellant

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

CERTIFICATE OF COMPLIANCE

I certify that I have 10,480 word count checked by the word program in

compliance with the Texas Rules of Appellate Procedure.

/s/ Brad McClellan

Bradley Dean McClellan

CERTIFICATE OF SERVICE

I certify that a copy of the foregoing Appellants’ Brief was served on the

through counsel of record by the method indicated below on May 27, 2015.

Adrienne Butcher, Assistant Attorney General Via efiling/eservice

Administrative Law Division

Office of the Attorney General of Texas

P.O. Box 12548 (MC-018), Capital Station

Austin, Texas 78711-2548

512-475-4208

Facsimile: (512) 320-0167

adrienne.butcher@texasattorneygeneral.gov

Attorneys for DWC and Commissioner

Courtesy copy provided to other Defendant Via efiling/eservice

below

Scott Placek & Matthew Foerster

Arnold & Placek, LLC

203 East Main Ave, Ste. 203

Round Rock, TX 78664

Attorneys for Defendant

/s/ Brad McClellan

Bradley Dean McClellan

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

APPENDIX

1. Order Granting Plea to the Jurisdiction of the DWC

2. First Amended Petition and Suit for Declaratory Judgment including

the Final DWC Decision and Order

3. AMA Guides Sections for Spine Impairments

No. 03-14-00808-CV Rosendo Morales Appellant’s Brief

CAUSE NO.269,135.8

ROSENDO MORALES, $ IN THE DISTRICT COURT OF

Plaintffi $

v. $ ho

$ .4r

TEXAS MUTUAL INSURANCE $ G, {lr:

|*rt

(-t II

coMPANY, $

Defendant, $ BELL COUNTY, .E* X

& $

-r

f5ilq

ilt

4 '_

$ f'ry

TEXAS DEPARTMENT OF INSURANCE. $

r\, nu

,\**,,

C'I

DIVISION OF WORKERS' $ @

COMPENSATION and COMMISSIONER $

ROD BORDELON,IN HIS OFFICIAL $

CAPACITY, $

Defendants. $ l46THJUDICIAL DISTRICT

ORDER

On November 2l , 2014, the parties in the above-referenced case appeared before the

Court for a hearing on Defendants Division of Workers' Compensation and Commissioner Rod

Bordelon's Plea to the Jurisdiction, filed July 29, 2014. After considering the parties' arguments,

the applicable law, and the pleadings and record in this case, the Court finds that Defendants

Division of Workers' Compensation and Commissioner Rod Bordelon's Plea to the Jurisdiction

is meritorious and should be granted.

Accordingly, the Court GRANTS Defendants Division of Workers' Compensation and

Commissioner Rod Bordelon's Plea to the Jurisdiction. Defendants Division of Workers'

Compensation and Commissioner Rod Bordelon are hereby DISMISSED from this case, and all

requested relief against them is DENIED.

qii'ilrrTF

SCAN

/4-B U pfl"{L

lllllrilrilltl 287

ORIGINf,, Filed 5l??12O1 4 2:1 9:08 PM

cAusE No. 269,135-8

E IN THE DISTRICT COURT

ROSENDO MORALES,

Plaintiff s

V. s

s BELL COUNTY, TEXAS

TEXAS MUTUAL INSURANCE CO.,

Defendant $

& $

Texas Department of lnsurance-Division of s

Workers' Compensation and Commissioner s

Rod Bordelon, in his officialcapacity, s

Defendants $ t46th tuolclAL DlsrRlcr

FIRST TORY J

& REOUEST FOR DISCLOSURE

PLAINTIFF, ROSENDO MORALES, in the above-entitled and numbered cause, files this Plaintiff's

First Amended petition, Request for Declaratory Judgment and Request for Disclosure, and

shows the Court:

I. DISCOVERY CONTROL PIAN

1. plaintiff requests discovery to be conducted under Level 2 Discovery Control Plan-By Rule.

See TEX. R. ClV. P. $190.3.

II. INTRODUSTION & PARTIES

Z. This is a suit for judicial review lawsuit of a final administrative decision of the Texas

Department of tnsurance-Division of Workers' Compensation and for a declaratory judgment

concerning the Texas Workers' Compensation Act.

3. plaintiff is Rosendo Morales, a severely injured worker, who resided and resides in Bell

County.

4. Defendant is the TEXAS MUTUAL lnsurance company, the lnsurance carrier for purposes

of Workers' Compensation. Texas MUtual has been served and has answered.

Cause No. 269,135-8 Morales v. Texas Mutual lns, Co & OWC Plaintlff s 1't Amended Jeltrqn-&-EED

ssF#t

trq'

5. Texas Department of lnsurance, Division of Workers' Compensation and Commissioner

Rod Bordelon, in his official capacity, which are necessary parties because statutory

construction of the agency's interpretation and improper application of the Workers'

Compensation Act (the Texas WC Act) is challenged, are defendants, the DWC

and the

Commissioner herein. Texas Department of lnsurance - Division of Workers' Compensation,

DWC, is a Eovernmental unit organized and existing under the law of the State of Texas, and

Commissioner Rod Bordelon, in his official capacity, in his official capacity as the Commissioner

of the Workers' Compensation Division are located at the Texas Department of lnsurance-

Division of Workers' Compensation, 7551 Metro Center Drive, Suite 1.00, Austin, TX, 78744.

plaintiff requests service on the DWC and the Commissioner at the above address'

III. JURISDICTION & VENUE

6. This Court has jurisdiction under Texas Labor Code Section 410.252 because Rosendo

Morales, the injured worker and Plaintiff, resided in Bell County at the time of his injury'

IV. BRIEF STATEMENT OF FACTS

7. Rosendo Morales the injured worker and Claimant, suffered a compensable injury on

November 22, 2O1O, while in the course and scope of his employment with Perry & Perry

Builders lnc., Employer, which provided workers' compensation insurance on the date of inlury

through Texas Mutual lnsurance Company'

B. Mr. Morales reached maximum medical improvement by statute on December 26, 2012.

g. After a Texas Department of lnsurance-Division of Workers' Compensation (DWC)

contested case hearing, the challenged disputed issue was: "1. What is the Claimant's

impairment rating?" The final DWC determination was a 13% impairment rating as determined

Cause No. 269,135-8 Morales v. Texas Mutual lns. Co & DWC Plaintiff s l"Amended JeIiIlQn4-B.EO

by the designated doctor, and plaintiff disputes and disagrees with

this rating including that it is

erroneous. See attached plaintiff Exhibit "A" DWC hearings decision of october 24,

invalid and

2013, and notice of becoming the final administrative decision on January 27,201'4'

V.RELIEFsoUcHTAsToWoRKERS,CoMPENSATIoNCLAIM

10. Rosendo Morales is aggrieved by and seeks relief from and reversal of the final DWC

rating

decision and order and contested case hearing decision and order on the impairment

issue (see attached Exhibit A), and specifically Rosendo Morales requests this Court to

determine that his impairment rating is either 35% as assigned by Dr. Weeks or a32Yo based on

Dr. Weeks alternative rating for the cervical spine injury.

11. Further the erroneous 13% impairment rating assigned by the designated doctor is invalid

and the designated doctor is not entitled to presumptive weight on judicial review.

VI. DECIARATORY JUDGMENT

tZ. Rosendo Morales asserts the need for declaratory relief in this matter under the Uniform

Declaratory Judgments Act including under Texas Civil Practice & Remedies Code section

37.OO4. Rosendo Morales further requests a declaratory judgment ruling that spine impairment

ratings under the Texas Workers' Compensation Act must take into consideration spinal

surgeries and the effects of spinal surgeries when the surgeries occur prior to maximum

medical improvement being reached. This legal question of whether spinal surgery occurring

before MMt must be considered in assigning an impairment rating was left open in Severiano

DeLeon v. Royol lndemnity Company,396 S,W.3d 597, 2010 Tex' App. LEXIS 565 (Tex' App'-'

Austin 20IQl rev'd on other grounds Severiano DeLeon v. Royal lndem. Co., 396 S.W.3d 527,

2012 Tex. LEXIS 972, 55 Tex. Sup. Ct. J' 108 (Tex' 2012).

Cause No. 269,135-8 Morales v. Texas Mutual lns' Co & DWC Plainti s 1" Amend

13. plaintiff requests this Court declare that under Texas Labor Code Sections 401'01L and

Chapter 408 concerning impairment ratings that the DWC designated doctor's report

is legally

type

invalid because while clearly aware or the pre-MMl surgery completely ignored the serious

of a spinal fusion surgery. This requires a declaration of the parties' rights under the Texas

Workers, Compensation Act. The date of maximum medical improvement under the Texas

Workers' Compensation Act means:

(30) "Maximum medical improvement" means the earlier of:

(A) the earliest date after which, based on reasonable medical probability,

further material recovery from or lasting improvement to an injury can no longer

reasonably be anticiPated;

(B) the expiration of 104 weeks from the date on which income benefits begin to

accrue; or

The Legislature has defined "impairment" as "any anatomic or functional abnormality or loss

existing after maximum medical improvement that results from a compensable injury and is

reasonably presumed to be permanent." Under Section 401.011 (23) the Legislature's

definitions are as follows:

(23) "lmpairment" means any anatomic or functional abnormality or loss

existing after maximum medical improvement that results from a compensable injury

and is reasonably presumed to be permanent'

(24) "lmpairment rating" means the percentage of permanent impairment of

the whole body resulting from a compensable injury'

The Court should declare and enforce against the DWC Defendants and Texas Mutual that an

"impairment" must be from an examination done after MMI has been reached and must be

based upon the doctor's evaluation of the injured worker's condition after MMI including full

considerationofthesurgeriesandtheeffectsof surgerypriortoMMl beingreached, TheDWC

Defendants and Texas Mutual have misinterpreted and failed to properly apply the law. The

Cause No. 269,135-8 Morales v. Texas Mutual lns. Co & DWC Plaintifl s 1" Amended Petit

not ignore and must consider an

DWC Defendants and Texas Mutual may

pre-MMl

rating that does not follow the Texas Workers' Compensation Act which requires

This Court

surgeries and the effects of the surgery to be considered in assigning an impairment.

should so declare and enforce.

14. Further, plaintiff requests this Court to declare that the statutory version of the AMA

Guides adopted under Texas Labor Code Section 408.124(c), specifically the fourth edition of

the "Guides to the Evaluation of Permanent lmpairment," published by the American Medical

Association (the AMA Guides). The DWC Defendants and Texas Mutual have misinterpreted

and failed to properly apply the AMA Guides and Defendants may not ignore and must

consider invalid an impairment rating that does not follow the AMA Guides which require pre-

MMI surgeries and the effects of the surgery to be considered in assigning an impairment. This

Court should so declare and enforce.

15. Mr. Morales requests this Court to declare that spinal surgeries and the effects of surgery

occurring before maximum medical improvement is reached must be considered in assigning an

impairment rating to injured workers under the Texas Workers' Compensation Act' Answering

this statutory and administrative rule interpretation will affect the validity of the impairment

ratings for spinal injuries under the Texas Workers' Compensation Act.

15. The DWC Defendants and Texas Mutual have not properly applied or interpreted the

statutory provisions affecting the DWC Defendants, Texas Mutual lnsurance Company and

injured workers with regards to spinal surgeries occurring before maximum medical

improvement and the required consideration of such surgeries in assigning impairment ratings

under the Texas Workers' Compensation Act and the applicable administrative rules concerning

Cause No. 269,135-8 Morales v. Texas Mutual lns. Co & owc plaintiff s 1" Amen

maximum medical improvement, spinal surgeries, and impairment ratings.

17. This Court should declare that the Texas Workers' Compensation Act and the AMA Guides

require that impairment ratings must take into consideration spinal surgeries and the effects of

spinal surgeries occurring prior to an injured worker reaching maximum medical improvement

and that any impairment ratings that do not consider such surgeries are legally invalid' lf a

conflict exists between the Texas Workers'Compensation Act and the AMA Guides, this Court

should declare the Texas Workers'Compensation Act controls and requires pre-MMl surgeries

and their effects to be considered in determining an impairment and impairment rating of a

worker including Mr. Morales.

18. plaintifl Rosendo Morales, is entitled to recover reasonable and necessary attorney fees

that are equitable and just under Texas Civil Practice & Remedies Code section 37.009 because

this is a suit in part for declaratory relief including the construction, validity, and the correct

application of several statutes and administrative rules. Plaintiff also requests this Court award

attorney fees pursuant to the Texas Workers' Compensation Act.

VII. REQUEST FOR DISCLOSURE TO AtL DEFENDANTS

19. Under the authority of Texas Rule of Civil Procedure 194, Plaintiff Rosendo Morales

requests that Defendants DWC and Commissioner Bordelon and Defendant Texas Mutual

tnsurance Company disclose, within 30 days of the service of this request or 50 days if served

with the original petition, the information or material described in rule 794.2.

VIII. PRAYER

For these reasons, Rosendo Morales asks the Court to grant the relief requested herein

including for the Court to determine that he is entitled to a 35% impairment rating or

Cause No. 269,L35-8 Morales v. Texas Mutual lns. Co & DWC Plaintiff s 1st Amended Petition EIED

alternatively a31%rating. Mr. Morales asks this Courtto declare that spinal surgeries and the

effects of such surgeries occurring prior to maximum medical improvement must be considered

in assigning impairment ratings under the Texas Workers' Compensation Act and under the

AMA Guides and that any impairment ratings that do not consider such surgeries are invalid'

Mr. Morales asks the Court to set aside as null and void the final DWC decision and order. Mr'

Morales also asks that the Court rule in his favor and enter judgment for the relief requested

herein and to award his reasonable and necessary attorney fees as allowed under the

declaratory judgment act and under the Texas Workers' Compensation Act, court costs and all

other relief to which he is entitled.

Respectfully submitted,

/s/ Brad McClellan

Bradley Dean McClellan

State Bar No. L3395980

Of Counsel, The Law Offices of Richard Pena, P.C.

170l. Directors Blvd., Suite 110

Austin, Texas 78744

Brad. McClella n @va hoo.com

Fax 512.3?7.8354

Telephone 512.327.5884

ATTORNEYS FOR ROSENDO MORALES

CERTIFICATE OF SERVICE

I certify that on May 22,201.4, a true and correct copy of the above and below was served on:

Attention: Matthew Foerster Via eservice and email

Arnold & Placek, LLC

203 East Main Ave, Ste. 203

Round Rock, TX 78664

Fax: 512 347.772.1

Attorneys for Defendant

/s/ Brad McClellan

Brad McClellan

Cause No. 269,135-8 Morales v, Texas Mutual lns. Co & DWC Plaintiff s 1st Amendedfelilion EBED

TH)ffiS DEPARTNfl HNT OF IN$UHAN#E

Drvr$rol{ SF WORKER$' f; SNfl PHNSATIOF{

Sl prefitre hablnr c$fl una persona de hahla hispnna flcerca de ests

corr.fi$ encia o d* su reclaruo, sirvase llamar sl l-fr0{h251-7gl!

.ianuary ?,'l , 2Qt4

L}T}T OFtsTfiE$ OP RICHARD PENJ{ Appenlll{ur

EHJhI}I,BY D. }{CCLEI,LAN

L?mt sIHEssoEs fifl;vD gTE rLo Dochet No: 1LtS6576*02-Al

AIJStrlit, fH ?fi?44*;tr"14{

Carrier No: 99LUUUUtldUlrH /

Ernployeer fln*$tlflfl Mt"lt}Br ErC

HrnpNoyen FERRY & PERRY BUTTHfiR$ INC

Date of

Injury: ll<Ivsuhar A*r 2o1o

Atler review by the Appeals Panel this Noti*e is ths desision filed with the Deput! flommissioner of

Hear,ingm regnrrling the matters in dispute and in respCIfi$€ to a refltusst for review by the Appeals Panel of

the Hearing Oflicer's ffeslsisn and Order. Accordingly, this constitutes notice that the Hoarins OificcCs

D$pisiqn and Order sifined on ectoher a* . :otr h$cnrns flnql on the date listed at the top of this

notice under the provisions of $410"169 or $410.20a(e) of the Texas Labor Code, If ths Hearing

Officer's Decision and Order became {lnElunder $410,16{}, a ns-tlss uf untirxely appeal is enclosed.

If you are not satisfied with this decision and desire to hnve the dispute resolved in rsurt, then you must

file a lawsuit in the appropriate di*trict cr:urt nffilatsilha$ the 45th ilav after rhe darc ,on w-hioh the

Division of Workers' Comnensatisn mailq.d the Barties the decision CIf the Appeals Pilnel pursuant to

MAcopy*fanysHeh[awguitmusthe{ileduiIfiultnneuus1ywiththe

'I'HXAS

CHIEF CLERK OF PROCEEffiINffiS, IIE-FARTh.{Er\T OF IN$URAN'flE, DIVISIOI{

OF WORKERS'CCII4PENSATION, P.O HfiX I77S7" AU$TIN, TEXAS, 78V44*77&7.

Claimants that are not represented by fln ftttCIrney may consult with an attorney of their choice

for further assistance-

Sineerely,

TEXAS DEPARTMENT OF INSURANCE

DWISION OF WORKERS' COMFENSATION

Plaintiffs Exhibit A

DROS (BevJred 1?-1 3) An Equal Spportunity Hmployrr

THIS LETTER TIA.S ILSO SEIIE fO llHE FOLLOIIINGT

ROSENDO MORALES TEXAS MUTUAJ, INSURANCE CO

6210 E HIGHVIAY 290

AUSTTN, TX 78723-1.026

ATTORNEY AT I,AW

SCOTT D. BOUTON

PO BOX 2689

PELUGERVILLE, TX 78591-2689

INFOR}IATIOil COPIES I{ERE AI.SO SENT fOr

PERRY E PERRY tsUII,DERS INC

PO BOX 1048

ROCKDAT,E, TX ?656?-1"048

DR00 (RevhEd 12-13) An Equ&l Opportunfty EmployEl

TEXAS ITEPARTMENT OF INSTIRANCE

DIVISION OF WORI(ERS' COMPENSATION

$i prefiere hablar con una persona de habla hispana acerca de esta

corespondencla o de su reclamo, slrvase llamar al 1-800-252-7031.

0ctober 2lr, 2013

tAW OFFICES OF RICHARD PENA DWC No: r r r56576

BBADLEY D. Docket No: r r r56576-oe-cc

l70l 0rREGT0RS BLVD STE lt0

''ICCLELLAN

AUSTIt'l, TX 78744*l l4l+ Carrier No: 9910000628987

Employee: ROSENDO }IORALES

Employer: PERRY E PERRY BUILDERS INC

Date of

lnjury: November 22, 2010

The Heaiing Officer has reached a decision and entered an order in the above referenced claim.

Copies of the decision and a fact sheet are attached explaining what to do if you waflt to appeal this

Hearing fficer's decision or if the other party appeals the decision.

Please note that if the Canier has been ordered to pay benefits in accordance with this decision,

those benefits, unless otherwise noted, include both indemnity and medicalbenefits.

lf you have questions or require assistiilnce, please call 1-800€52.7031. To expedite the handling of

reguests for appeal and respo;rses to requests for appeal, all conespondence should be addressed to

the:

CHIEF CLEHK OF PROCEEDINGS, HEARINGS

TEXAS DEPARTMENT OF INSUHANCE

DIVISION OF WORKERS' GOMPENSATION

POST OFFICE BOX 17787

AUSTI N, TEXAS 7 87 44.N 87

Sincerely,

Texas Department of lnsurance

Division of Workers' Compensation

)R0B6w.o+oe1 tui Equal Opporiunlty Emphyer

THIS LETTEH WAS ALSO SET{TTOT}IE TOLLOIIIIING;

HOSENDO MORALES TDflS MUTUAL INSUHANCE CO

6210 E HIGHWAYEgO

AUSTTN. TX 7872S-.t026

ATTOHNEYATLAW

SCOTT D. BOUTON

PO BOX P68e

PFLUGEBVILLE, TX 78691 -268S

INFORMATION COPIES VI'EHE ALSO SENT TO:

PEHHY & PEHHY BUILDEHS INC

PO BOX 104S

ROCKDALE, TX 76567.1048

DROS Ar Equal Opportunfi Emptoyer

wA 1r15657642-CC

TEI(AS DEPARTI\'IENT OT INST]RANCE

DTVISION OF WORKER'S' COMPENSATION

WACO FIELD O.E['ICE

wAco, rExAs

o!?Hm

ocr 2 2 ilBts

ROSEI{DO MORALES,

CI,AIIT,IAIAIT $

@rucs

$ DOCKET NO.

$ wA.1r.-1s6576-02-CC-WA41

IEXA.S MUTUAL INSTJRAI{CE

COMPAI\IY,

CARBIER $

DECISION AFID ORDER

This case is decided pursuant to Chapter 410 of the Texas Work*o' Compensation Act

and

Rules of the Division of Workers' Compensation adopted thereunder.

ISSI.IES

A benefit review conference was held on luue 4,2}ll,

to mediate resolutiou of the disputed

issue; however, the parties were unable to reach an agteement. After a continuance from

JuIy

24,ZOl3, a contested case hearing was held on luty 30,2013, followed by a continuancE on

August lb, 2013, atrd a cortested case hearing held on October 14, 2013, to decide the following

disputed issue:

l. What is the Claimant's impairment rating?

The Hearing Officer added the following issue:

2. Did Cafiier have good cause for failing to aPpear at the scheduled

contested case hearing on July 30, 2013?

Though not certified, the following issue was added becarxe it was achrally litigated:

3. Is venue proper in the Waco Field Office of the Texas Department

of Insurance, Division of Workers' Compensation?

PARTIES PRESENT

Clnimant appeared and wae represented by Bradley D. McClellan, attorneyr at the contested case

hearings on July 30, 2013, and on October 14, 2013. Carrier failed to appear at the coutested

CONFIDENTIAL

T[r laborCodc

!4fi1.083

case hearing on luly 30, 2013; and was represetrted by Scott D. Bouton, attortrey, at the hearing

on October 14,2013.

OTT'ICIAL NOTICE

Official notice was takeu of the MapQuest mileage guides.

EYII}ENCE PRESENIED

The following wihesses testified:

ForClaimant: Clairnant.

For Carrier: None.

The following exhibits v1,s1s sdmitted into evidence:

Hearing Officer's Exhibits: HO-l through HO-7.

Clsimant's Exhibits: C-l thrcugh C-12.

Carrier's Exhibits: CR-A through CR-O.

BACKGROT]ND INE ORI\,IATION

Concerning the issue of Carrier's failure to appear, a benefit review conference was held on June

4, 2013, following a request 1s sfuange venue from Waco to Austin. Following the benefit

review conference held in the Austin Field Office on Juue 4,20L3, the contestedlase hearing

was scheduled to be held in the Austin Field Office on JuIy 24,20t3. Due to a subsequenl

change of venue, the contested case hearing was not held in the Arutin Field Office on Juty

Z+,

2013, but was continued on June 27, 2013, and rescheduled to be held in the Waco Field Office.

On June 27,2OL3, the parties, including Carrier, were sent notice of the scheduled contested case

hearing to be held in the Waco Field Office on fuly 30, 2013. Carrier failed to appear for the

conteeted case hearing scheduled for 10:30 AM on Tuesday, July 30, 2013. Carrieriisponded

the 10-day show cause letter that was mailed to Carrier oo rUyio, iOtr, and requested that the

hearing be rescheduled to permit it to present evidence on the d.isputed issue.

Following a

continuance from August 19, 2013, a cootrsted case hearing was held on october

14, 2013. At

the contested case hearing on october 14, z0r3; Mr. scott b. Boutou,

the attomey representing

Carrier, explained.that he was in Laredo, Texas, representitrg Carrier on

July lo,iolS,and was

unable to attend the scheduled cotrte$ted case for tUat aate; hiwever,

Mr. Boutondid not explain

whv Carrier was unable to attend ttre scheauteJ

";;;J;;; hearing for ruty ro, zorg.

At the contested case hearing on October 14, 2013, h/tr. Bouton stated that Carrier

would not

stipulate that venue was proper in the waco Field office of the

Texas Deparment of Inswance,

CONFIDENTIAL

Ter IabsCodc

$402.083

Division of Workers' Compensation. Ivfr. Bouton contended that vetrue was proper either,in the

Waco Field Office or the Austin Ficld Office, and that Carrier betieved that venue was orooer in

the Austin Field office. claimant testified that he lived and resided .t

I* November 20, 2010, the date of his compensable injury,-anrl that he wanted

his conte$ted case hearing to be conducted in the Waco Field Offrce; Official Notice was taken

of the MapQuest mileage guide (MapQuest) and also.made a Hearing Officer's exhibit.

-I

According to MapQuest, it is 35.09 miles one-way from Cleimant's residence in Temple; Texas,

to the Waco Field Office of the Texas Department of Insruanc+, Division of Worker's

Compensation located at 801' Austin Avenue, Wflco, Texasi and it is 57.32 miles oue-way from

Qlnimant's residence in Temple, Texas, to the Austin Field Offrce of the Texas.Department of

Insglssss, Division of Worker's Compensation located at 4616 W Howard I-ane, Suite 130;

Austin, Texas. Claimant contended that venue wa$ proper in the Waco Field OfEce of the Texas

Department of Insurance, Divisiou of Worker's Compensation, and cited Texas Labor Code

$410.005 concenring venue for a contested case hearing.. According to Texas Labor Code

$410.005(a), the statue states that'lrnless the division determines that good cause exists for the

selection of a diffrient location, a benefit review couference or a contested case hearing may not

be conducted at a site more than 75 miles from the claimant's residence at the time of the injury."

Itr this case, Claimant indicated that he wanted the contested case hearing to be held in the Waco

Field Office of the Texas Departrnent of Insurance, Divisiou of rfforkEr's Compensation, and

there was no good cause determination that the contested case hearing should be held at atry

other location other than the'Waco Field Office of the Texas Department of Insuance, Divisiotr

of Workers' Compensation.

In regard to the issue of impairment rating (IR), Claimant, a welder, sr:stained a comperuable left

shoulder contusiorl le,$ upper arm contusioq righJ heel contusion" right knee coniusion, right

hee meniscal teat and arthritis, neck contusion, and C5-6 radiculopath| injury on Novemb erl1,

2010. The parties stipulated ttrat Claimant reached maximum *"ticai improvement

lMIvtg on

the statutory date of December ?;6,2012, for the compensable injury of Nivemb er 22,2010,

certified by Anil Tirk-arampant Bangale, M.D., the Division-selected designated doctor, and

Trenton D. Weets, D.C., the treating doctor referral.

Dr. Bangale was appointed as the designated doctor by ttre Division to evaluatE

Claimant for the

com,Pensable iujury to determine MMI, IR, and extent of injury. Dr. Bangale evaluated

Claimant

January 4,2073, and determined that Claimant reached irflral oo an iniorrect

9n statutory date of

Novenrber 22,2012, and assigned, a, 13% IR for the compensable injury

that included 77o IR for

the left shoulder contusion and Ieft upper arm contusion;-0%

IR for tU- righih*i contusion; tr,

for the right knee contusiou and righf knee meniscal tear and artt'itis;

aod 5% IR for the neck

contusion and C5-5 radiculopathy under DRE Category II for

the **i"uf qpir;- Following a

letter of clarification, Dr. Bangali amended his prioicertifi*tioo

and determined that claimant

reached MMI on the statutory date of December 26, z0lz,

comgeryable injury- colcerning his placement of Claimant "g"ir

and ilip"d ;JiE m. for the

uuder DRE category tr for the

cervical spine, Dr. Bangale stated ttrat [e was awarc that

Claimant haa *o"rgd" a multi-level

spinal fusion of the cervical spine. Dr. Bangale firrther stated

that Claimant dijnothave signs of

CONFIDENTIAL

Tex. I*bor Code

[4{r2.083

cervical radiculopathy based otr his clinical exnmination sf f,leimnnt and there was tro loss of

motion segmeff integrity.

Dr, Weeks, the freating doctor referral, evaluated Claimant on December 4, 20L2, flnd

determined that Claimant reached MMI on Decembpr 4,201?,, and assigned a l7% IR for the

compensabte injury. Dr. Weeks ag.eed with the IR that p1, $engele assigned for the

compensable injtuy except Dr:, Weeks opined that Claimant should be assigned 107o IR under

DRE Category Itr for the cervical spine rather thau the 5% IR that Dr. Bangale had assigned

under DRE Category tr. Dr. Weeks subsequently reevaluated Claimant on April g, 2013, and

determined that Claimant reached MMI on the statutory date of Decembei 26, 2012, and

assigned a35% IR for the compensable injury. Dr. lVeeks reiterated that he agreed with the IR

that Dr. Bangale assigned for the compensable injrtry except Dr. Weeks opined that Claimant

should be assigned 27% IR under the Range of Motion (ROM) Model for the cervical spine

rather than the 5% IR that Dr. Bangale assigned under DRE Category II of the cervicat spine.

Dr. Weeks indicated that he used the ROM Model instead of the DRE Model because Claimant

had undergone a multi-level cervical fusion surgery.

Based on the evidence presented in the hearing, thg preponderance of the evidence is not

contary to the determination by Dr. Bangale, the Division-selected designated doctor. that

Cleimant's IR is 13% for the compensable injury. In addition, Carrier did not have good cau$e

for failing to appear at the scheduled contested case hearing on Iuly 30,,2013, and venue is

proper in the Waco Field Office of the Texas Department of hsurance, Division of Workers'

Compensation.

Even though alt the evtdence presented wa.s trot discussed, it was con'sidered. The Findings of

Fact and conclusions ofLaw are based on all ofthe evidence preseuted.

FIhIDINGS OF ['ACT

1. The parties stipulated to the following facts:

A. On Novemb er ?2,2010, Cleimant was the employee of perry & perry Builders,

Inc., Employer.

B' On Novemb e1 22,2010, Employer provided worker$' compeusation insuanc+

with Texas Mufual Insurance Compauy, Carrier.

C' It is undisputed that llaimant sustained a compensable left shoulder contusion,

left upper arm contusion, right heel contusion, right knee contusi*, ,ight

ko**

meniscal tear and arthdtis, neck contusion, andt5-6 radiculopathy

inirry o1

November ZZ,Z0LO,

I CONFIDEruTTET I

I n*.0"

r"* I$orcodc I

D. Anil Tukararrpant Bangale, M,D., was appointed as the designated doctor by the

Division to evaluate Claimsnt foi the compensable injruy of November2?,,20L0,

to determine MMI, IR, and extent of injrrry:

E. Claimant reached stflhilory MMI on December 26,2ill2,fot the compensable

injrrry of November 22,2010, as certified by Anil Tukarampant Bangale, M.D.'

the Division-selected designated doctor, and Trenton D. \Veeks, D.C., the treating

doctor referral.

2. Carrier delivered to Claimant a single document stating the tnre corporate name'of

Carrie+ and the name and steet address of Carrier's regiitered agen! which docr:ment

was aduriued into evidence as Hearing Officer's Exhibit Number 2.

3. On Jr:ne 27,20L3, Carrier was sent notice by the Division of the scheftrled contested case

heariug to be held on at 10:30 AM on Tuesday, July 30; 2013, in the Waco Field Office

of the Texas Departrnent of Insurance, Division of Workers' Compensation.

4. Carrier failed to appear at the scheduled contested case heiring on July 30, 2013, and was

sent a 10-day show cause letter on July 30, 2013.

5. Carrier timely responded to the 10-day show cawe letter and requested that the contested

case hearing be rescheduled to permit it to present evidence on the disputed issue and to

show cause why it failed to appear for the scheduled contested case hearing ou July 30,

2013. :

6. The contested case hearing was rescheduled and held on Monday, October 14, 2013, and

Carrier did not offer a good cause explanation why Carrier was unable to atteud the

scheduled contested case hearing on fuly 30, 2013.

7_ Claimant lived and resided at on November 20, 2010,

the date of his compensable injuy.

8. The Waco Field Office of the Texas Deparfinent of Insuance, Division of Worker's

Compensatiou, is located within 75 miles-of Claimant's residence and it is 35.09 miles

one-way from Claimant's residence in Temple, Texas, to the Waco Field Office of the

Texas DePartment of Insurance, Division of Worker's Compensatiou located at 801

Austin Avenue, Waco, Texas.

o There has not been a good cause determination by the Division that the contested case

!**io$ should be held at ary other location other than the Waco Field Office of the

Texas Departnent of Insurance, Division of Vy'orkers' Compen$ation and the Divisiou

scheduled the contested case hearing in accordance with Texas Labor Code

9410.00S(a).

CONFIDENTIAL

Tcx. LrborCodo

f,4d2.083

10. The deteruiuation of Anil Tukarampant Bangale, M.D., the Division-selected designated

doctor, that'claimant's IR i8 1396 for the compensable injury of Novembet 22,2010, is

not cotrtrary to the preponderance of the widence.

CONCT,USIONS OI'LAW

. 'i: .. , r'

The Texas .Department, of Insurance, of Compensation, has

jruisdiction to hear this csse.

?. Venue:is proper in thg Waco Field.Office of the Texas. Departrnent of rnsurance, Division

of Workers' Compensatiou.,

3. Caryer did not hpve good cause for failing to apppar at the scheduled contested case

hearing on July,30, 2013. ..

4. Claimant's IR is 13%.

DECISION

Yg* is propea in.the V{aco Field ofEce of th+ Texas Depa4ment of Insuance, pivision of

Workersl C.9m. pensation, Carrier did not have good caqse,foi foil,"s tq appefl[ qt the scheduled

contested case hearing on July 30, 20ll: Claimantls IR.is l3%. -

ORDER

larrier is ordered, to pay.r benefits in accordatce with thi$, decipion, the Texas Workers,

Compensation Acq and the Commissioner'q Rules. Aecnred;but unpaid incomq

benefits, if any,

shall be paid in a l,rmp sum together *"ith ioter"st as providea'by lu*".

..,.,,,

Pl_!nr::grporare name of the iruuance carrier is IEf,'{S,MUTUAL, INSURAIICE

CoMPAIIY' and the name and address of its registerea agent foi r"*i." i*

l; ,. . , :,

,-., "rprol**

*,",UHJ;TH+f#ft?THf,

,q,usTIN, TEn G;dzs

fl- '*

Sigded this 22nd day of Ocrober, 2013.

Wes Peyton

Heariug Officer

American Medical Association

Physicians dedicated to the health of America

Guides to the

Evaluation of

Permanent

Impairment

Fourth Edition

Chapter 1

IIIlPainnent

Evaluation

I s it possible to improve estimates of the severity

of human impairments, basing them on accepted

medical standards? Can those estimates be used

1.1 Impairment, Disability,

Handicap

in comparing, evaluating, and adjudicating claims of

ill health and impairment arising in workers' compen- Impairment is defined in the Guides as an alteration

sation cases, Social Security Administration cases, of an individual's health status. Impairment, accord-

and other types of cases? ing to the Guides, is assessed by medical means and

This book, Guides to theEvaluation o/Permanent is a medical issue. An impairment is a deviation

Impairment (Guides), began to take form during the from normal in a body part or organ system and its

1950s under the premise that the answer to the first functioning. The Guides defines "permanent impair-

question is "yes." An ad hoc committee appointed by ment" as one that has become static or stabilized

the Board of Trustees of the American Medical Asso- during a period of time sufficient to allow optimal

ciation (AMA) gave impetus to the effort. The first tissue repair, and one that is unlikely to change in

edition of the Guides was published in 1971, and spite offurther medical or surgical therapy.

those involved with succeeding editions have sought The Guides definition of an impairment closely

to improve and refine it, to the end that it could be parallels that of the World Health Organization

useful anywhere when questions arise about people's (WHO), which has defined an impairment as "any

physical and mental functioning and capabilities. loss or abnormality of psychological, physiological,

The Guides provides a standard framework and or anatomical structure or function. "1

method of analysis through which physicians can In the Guides, impairments are defined as condi-

evaluate, report on, and communicate information tions that interfere with an individual's "activities of

about the impairments of any human organ system. daily living," some of which are listed in the Glossary

The book uses up-to-date information on impairment (p. 315). Activities of daily living include, but are

and illness provided by knowledgeable clinicians and not limited to, self-care and personal hygiene; eating

scholars. In the physician's office, the book can be and preparing food; communication, speaking, and

an aid to making the diagnosis of an impairment and writing; maintaining one's posture, standing, and

following the course of therapy. sitting; caring for the home and personal finances;

walking, traveling, and moving about; recreational

and social activities; and work activities.

Concepts oflmpairment Evaluation 1/3

12 Structure and Use of the Guides 13 Are the Guides Criteria

Obj ective and Authoritative?

Using the Guidesrequires integrating previously

gathered medical information with the results

The contributors to the Guides understand the impor-

ofa current medical evaluation. The evaluation

tance of having objective data on the functioning of

should be carried out in accordance with the direc-

normal persons' organ systems in order to evaluate

tions in the Guides, and it should be based on three

those of impaired individuals. For many systems (eg,

components.

the respiratory, cardiovascular, visual, auditory, endo-

First, certain types of information, described in

crine, hematologic, and digestive systems), medically

Chapter 2, are needed to document the nature of an

accepted and scientifically derived data on normal

impairment and its consequences. Chapter 2 specifies

functioning are available. The Guides generally makes

how to acquire information and defines a format for

use of these data and references their sources.

analyzing, recording, and reporting the information.

If the Guides contributors have been unable to

Second, the Guides chapters on the organ systems

identify objective data on the normal functioning

contain protocols or descriptions of ways to evaluate

of an organ system, they have estimated the exten t

a particular body part, function, or system. Third, the

of impairments on the basis of clinical experience,

chapters contain tables relating to the evaluation

judgmen t, and consensus. The estimates of the well

protocols. If the physician has followed the protocols

qualified persons contributing to this book, most of

and tables, then the reported findings will be con-

them physicians, would be more convincing than

gruent with the Guides criteria.

those of most others in estimating the severity of

In practice, the first key to effecting an accurate people's impairments.

impairment evaluation is a review of office and hospi-

It should be understood that the Guides does not

tal records maintained by the physicians who have

and cannot provide answers about every type and

cared for the patient since the onset of the medical

degree of impairment, because of the considerations

condition. Such records include clinical notes, medi- noted above and the infinite variety of human disease,

cal consultation reports, hospital records, admission and because the field of medicine and medical prac-

and discharge summaries, notes on operations, pathol- tice is characterized by constant change in under-

ogy and laboratory test reports, and reports on spe- standing disease and its manifestations, diagnosis,

cial tests and diagnostic procedures. Using multiple and treatment. Further, human functioning in every-

sources of information and attempting to ensure that day life is a highly dynamic process, one that presents

the sources are objective can help eliminate bias, an a great challenge to those attempting to evaluate

error introduced by selecting or encouraging one impairment.

outcome over another. The physician's judgment and his or her experi-

Before judgments according to the Guides are ence, training, skill, and thoroughness in examining

accepted, the history and course of the medical con- the patient and applying the findings to Guidescri-

dition must be analyzed. This analysis should include teria will be factors in estimating the degree of the

findings from previous examinations, the treatment patient's impairment. These attributes compose part

and responses to treatment, and the impact of the of the "art" of medicine, which, together with a foun-

condition on the patient's activities. Before ajudg- dation in science, constitute the essence of medical

ment regarding impairment is made, it must be practice. The evaluator should understand th~t.o~her

shown that the problem has been present for a period considerations will also apply, such as the senSItIVIty,

of time, is stable, and is unlikely to change in future specificity, accuracy, reproducibility, and interpreta-

months in spite of treatment. tion oflaboratory tests and clinical procedures, and

In evaluating an impairment, it is important variability among observers' interpretations of the

to obtain enough clinical information to characterize tests and procedures.

it in accordance with the Guides requirements. Once

this task is accomplished, the evaluator's findings

may be compared with the clinical information already

available about the individual. If the evaluator's find- 1.4 Is the Guides Widely Used?

ings are consistent with the results of previous clini-

cal studies, the findings may be compared with the

Guides criteria to estimate the impairment. If the In a word, yes. Recently compiled data from a

findings are not consistent with those of earlier stud- 1991 AMA survey indicate that in 40 of 53 jurisdic-

ies, there should be communication between the tions (38 states and two territories), use ofthe Guides

involved physicians and clinical studies as needed to is mandated or recommended by law in workers' compen-

resolve any disparities. sation cases, or the book is frequently used in such

Chapter 2

Records

and Reports

E stimating the extent of permanent

impairments is most effective when there is

sufficient medical and nonmedical informa-

tion to justify the estimates and minimize adversarial

Compare this approach with some impairment

evaluations wherein physicians examine and report

on patients without a standard protocol. In such

instances, it is impossible to compare reports, because

situations. This chapter describes how the Guides can there is no assurance that the physicians have

help provide consistent and reliable acquisition, examined the same body parts or systems in the same

analysis, communication, and utilization of medical way. For example, one physician may measure flexion

information. of the hip or knee, but another may not mention those

The major objective of the Guides is to define the movements. Or one physician may report that the

assessment and reporting of medical impairments so patient can flex the arm 90°, while another may not

that physicians can collect, describe, and analyze measure the range of motion. Without standardization

information about impairments in accordance with a of evaluations and reporting procedures, an individual

single set of standards. Two physicians, following the reading these reports would have difficulty deciding

methods of the Guides to evaluate the same patient, which report to believe. This outcome is neither rea-

should report similar results and reach similar con- sonable nor fair, and it tends to give rise to avoidable

clusions. Moreover, if the clinical findings are fully confrontation.

described, any knowledgeable observer may check the When physicians follow the Guides to measure and

findings with the Guides criteria. report their impairment estimates, the persons who

If two physicians who examine a patient and receive the evaluations may be held accountable for

use the methods of the Guides do not obtain similar assessing the results in accordance with the Guides

results and reach similar conclusions, then the book recommendations. Because issues of medical fact

can be used to resolve the discrepancies. Analysis of should have been settled by this stage in the process,

the records and reports in question will disclose the the recipients of the evaluations should not find it

disparities, which should be in matters of fact rather necessary to choose among conflicting opinions.

than opinion. If the patient's medical condition is By consulting the standardized medical evalua-

stable, then different physicians should reach the tion protocols and reference tables and reviewing the

same general conclusion. Ifwidely disparate evalua- recommendations of the Guides, the recipient may

tions occur, then the stability of the medical condi- verify whether or not all necessary information was

tion and the matter of permanent impairment collected. If it was, the correctness of the evaluation

would be in question. may be ascertained by comparing it with the Guides

Records and Reports 2/9

Interpolating, Measuring, and Rounding Off 1 % to 3%), combining that percent with any other

In general, an impairmen t value that falls between impairment percent by means of the Combined

those appearing in a table or figure of the Guides may Values Chart (p. 322).

be adjusted or interpolated to be proportional to the In some instances, as with the recipients of

interval of the table or figure involved, unless the transplanted organs who are treated with immunity-

book gives other directions. suppressing pharmaceuticals or persons treated with

Unless generally accepted standards exist, as anticoagulants, the pharmaceuticals themselves may

with many laboratory tests, two measurements made lead to impairments. In such an instance, the physi-

by the same examiner and involving a patient or a cian should use the appropriate parts of the Guidesto

patient's functions may be expected to lie within evaluate the impairment related to the pharmaceuti-

10% of each other. cal. Ifinformation in the Guides is lacking, the physi-

Measurements should be consistent between two cian may combine an estimated impairment percent,

trained observers; if they have been made by one the magnitude of which would depend on the severity

observer on separate occasions, they also should be of the effect, with the primary organ system impair-

consistent. Repeating measurements may increase ment, by means of the Combined Values Chart.

their credibility. A patient may decline treatment of an impair-

A final estimated whole-person impairment ment with a surgical procedure, a pharmacologic

percent, whether it is based on the evaluation of agent, or other therapeutic approach. The view of

one organ system or several organ systems, may be the Guides contributors is that if a patient declines

rounded to the nearer of the two nearest values therapy for a permanent impairment, that decision

ending in 0 or 5. should neither decrease nor increase the estimated

percentage of the patient's impairment. However,

the physician may wish to make a written comment in

Pain

the medical evaluation report about the suitability

In general, the impairment percents shown in the

of the therapeutic approach and describe the basis of

chapters that consider the various organ systems

the patient's refusal.

make allowance for the pain that may accompany the

impairing conditions. Chronic pain, also called the

chronic pain syndrome, is evaluated as described in

the chapter on pain (p. 303).

2.3 General Comments on

Evaluation

Using Prostheses in Evaluations

The general view of the Guides is that if an individu-

al's prosthesis or assistive device can be removed or The Guides attempts to take into account all relevant

its use eliminated relatively easily, the organ system considerations in estimating or rating the severity and

should be tested and evaluated without the device. extent of permanent impairment and the effects of

For example, a hearing aid should be removed before the impairment in terms of the individual's everyday

auditory acuity is tested. However, the examiner may activities. An impairment should not be considered

choose to test the system with the assistive device in "permanent" until the clinical findings, determined

place also and then report both sets of results. during a period of months, indicate that the medical

If the assistive device is not easily removable, as condition is static and well stabilized.

with an implanted lens, the organ system's functioning A physician who is asked to reevaluate an indi-

should be evaluated with the device in place. The vidual's impairment must realize that change may

visual system should be tested with the patient's have occurred, even though a previous evaluator

glasses or con tact lenses in place if they are used. considered the impairment to be permanent. For

instance, the condition may have become worse as a

result of aggravation or clinical progression, or it may

Adjustments for Effects of Treatment or have improved. The physician should assess the cur-

Lack of Treatment rent state of the impairment according to the criteria

In c

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