For the Fifth Circuit__________________________________________
No. 98-60224
Summary Calendar
_________________________________________
SANDRA F. WALKER
Plaintiff – Appellant,
VERSUS WAL-MART STORES, INC.
Defendant – Appellees.
__________________________________________
On Appeal from the United States District Court for the Southern District of Mississippi
__________________________________________
November 18, 1998
Before REYNALDO G. GARZA, JOLLY, and WIENER, Circuit Judges.
PER CURIAM:
FACTUAL AND PROCEDURAL BACKGROUND
In January of 1990, Sandra Walker (“Walker”) was employed by Wal-Mart Stores Inc. and was a member of the Wal-Mart Associates Group Health Plan (“the Plan”), which provided Walker with medical and dental benefits. The Plan is governed by the Employee Retirement Income Security Act (“ERISA”).
Beginning January 18, 1990, through January 25, 1990, Walker underwent dental treatment by Dr. Van R. Simmons, a dentist in Mississippi. On January 7, 1992, Walker initiated a malpractice action in state court against Dr. Simmons for dental malpractice. She alleged that he propped her mouth open excessively, thus causing her to undergo three inpatient surgeries for repair of her right and left temporomandibular joints.
Walker’s medical expenses totaled $41,598.59 and were paid by the Plan. On June 19, 1996, Walker agreed to release Dr. Simmons of all claims in exchange for a settlement agreement of $12,500.
On December 13, 1996, Walker instituted a declaratory judgment action in the Circuit Court of Pike County, Mississippi. Walker argued that she was entitled to the whole of the settlement proceeds received in the underlying malpractice action. On January 21, 1997, the Plan removed the case to federal court on the basis of federal question jurisdiction.
On March 31, 1998, the United States District Court for the Southern District of Mississippi granted the Plan’s Motion for Summary Judgment and ordered the entirety of the $12,500 be paid to the Plan as reimbursement for its medical expenses. Walker appealed the lower court’s decision.
II. STANDARD OF REVIEW
In Firestone Tire and Rubber Co. v. Bruch , 489 U.S. 101, 115 (1989), the Supreme Court established that courts must apply a de novo standard of review in actions brought by ERISA plan participants who challenge the denial of benefits. However, if the plan vests the plan administrator with discretionary authority to make eligibility determinations or construe the plan’s terms, the appropriate standard of review is for abuse of discretion. Id .
This Court has held Bruch’s principles applicable not only to benefit determinations brought by plan participants, but also to plans’ assertions of purported reimbursement and subrogation rights. Sunbeam-Oster Company, Inc. Group Benefits Plan for Salaried and Non-Bargaining Hourly Employees v. Whitehurst , 102 F.3d 1368, 1373 (5th Cir. 1991). In Whitehurst , we applied a de novo standard of review because the parties agreed that the administrator had not been vested with discretionary authority to interpret the Plan at the time of the plaintiff’s injuries. Id . Had we found that the administrator had possessed discretionary authority at the time of the injury, the appropriate standard of review would have been for abuse of discretion.
Like in Whitehurst , the Plan herein is asserting its reimbursement and subrogation rights over the plaintiff’s monetary recoveries from the tortfeasor. In this case, however, the issue on whether the administrator was vested with discretionary authority has not been settled and we must look at the Plan’s language to determine if any of its provisions vested the administrator with such authority. The relevant provision, for determining this issue, reads as follows:
The PLAN herein expressly gives the ADMINISTRATIVE COMMITTEE discretionary authority to resolve all questions concerning the administration, interpretation or application of the PLAN, including without limitation, discretionary authority to determine eligibility for benefits or to construe the terms of the PLAN in conducting the review of the appeal. . . .
This provision clearly vested the Administrative Committee with the discretionary authority to interpret the terms of the Plan, therefore, the proper standard of review in this case is for abuse of discretion.
III. DISCUSSION
There are two issues presented in this case. First, whether the Plan’s language unambiguously speaks to this dispute and sufficiently provides for the distribution of settlement proceeds of the type paid in this case. Second, whether the plaintiff’s attorney is entitled to deduct his fees and expenses prior to the Plan being reimbursed under his own reimbursement contract with the plaintiff.
Walker’s argument, for right of possession over the settlement money, is three-fold. First, she argues that the Plan chose not to participate or finance the lawsuit and should therefore be barred from recovering any of the settlement money. Second, Walker maintains that the language of the Plan never contemplated partial recovery by a participant nor did it ever consider the issue of attorneys’ fees. Third, Walker contends that there is no proof that the settlement sum paid was a result of any malpractice by the tortfeasor and therefore the reimbursement provision does not apply.
The Plan argues that it is entitled to the right of subrogation and recovery of all amounts paid. The Plan points out that it expended $41,498.59 for Walker’s medical treatment and that the plain language of the Plan gives it the right to recover benefits that it has previously paid to the extent of any payments resulting from settlement, regardless of how the parties chose to designate those payments.
The Plan asserts that the relevant provisions are unambiguous. Walker, however, claims that they are insufficient for determining the distribution of the settlement proceeds. The provisions read as follows:
The PLAN shall have the right to reduce benefits otherwise payable by the PLAN or recover benefits previously paid by the PLAN to the extent of any and all of the following:
A. Any payments resulting from a judgement orsettlement, or other payment or payments,made or to be made by any person or personsconsidered responsible for the conditiongiving rise to the medical expense or bytheir insurers, regardless of whether the payment is designated as payment for suchdamages including, but no limited [,] to painand/or suffering, loss of income, medical benefits or any other specified damages; orany other damages made or to be made by anyperson . . .
Congress expressly intended for ERISA Plans to be “written in a manner calculated to be understood by the average plan participant,” and need only be “sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan. Title 29 U.S.C. § 1022(a)(1). In light of this statute, we have previously held that ERISA plans should not be held to the same standard that an insurance contract purchased in an open market is held to. Jones v. Georgia Pacific Corp. , 90 F.3d 114, 116 (5th Cir. 1996). Such a contract is purposefully drafted with greater particularity because courts usually construe plan terms strictly in favor of the insured. ERISA, on the other hand, expressly guards against boilerplate language in its plans and we must therefore interpret ERISA plans’ provisions as they are likely to be “understood by the average plan participant,” consistent with ERISA’s statutory drafting requirements.
We hold that the Plan’s language is unambiguous and that the administrators’ interpretation of the Plan did not constitute an abuse of discretion. We agree with the district court in holding that the “any and all” language plainly means the first dollar of recovery (any) and 100% recovery (all) of the funds received by the plaintiff in the settlement, up to full amount of the benefits paid. The Plan’s unambiguous language does not include a provision for reduction of its subrogation lien for payment of attorneys’ fees or costs. Interpreting the provisions to provide for attorneys’ fees and expenses would have been wholly improper by the district court. Furthermore, the fact that the provisions do not specifically mention attorneys’ fees or set out detailed distribution procedures, does not constitute silence or ambiguity on behalf of the Plan. Whitehurst , 102 F.3d at 1375. This Court has firmly held that an ERISA plan should not be penalized for lack of technical precision or verbosity by labeling the Plan “silent” or “ambiguous” when it is simply using the direct language mandated by ERISA. Id .
IV. CONCLUSION
In sum, we conclude that the administrator’s interpretation of the plan was legally correct and that the language of the Plan’s subrogation and reimbursement provisions are clear and unambiguous. Furthermore, in the absence of any expressly selected alternative standard, the Plan Priority norm vested the Plan with unconditional reimbursement for the full amount of the medical benefits paid to Walker. Therefore, her attorneys are not entitled to deduct their fees or expenses.
We find that there was no abuse of discretion by the Administrative Committee and AFFIRM the district court’s decision to grant the Plan’s Motion for Summary Judgment.
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IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 08-11052
AMERICAN INTERNATIONAL SPECIALTY LINES INSURANCE CO.,
Plaintiff-Appellant,
v.
RENTECH STEEL LLC; PRESTON TEEL; LESA CROSSWHITE;
JENNINGS TEEL,
Defendants-Appellees.
Appeal from the United States District Court
for the Northern District of Texas (Abilene Division)
Before KING, BARKSDALE, and ELROD, Circuit Judges.
JENNIFER WALKER ELROD, Circuit Judge:
This case addresses whether an insurance policy that excludes coverage
for an “obligation” incurred under “any workers’ compensation law” bars
coverage for a judgment that an employee recovers in a negligence action against
a Texas employer that does not subscribe to the Texas workers’ compensation
system. Because the Texas Workers’ Compensation Act (“TWCA”) imposes no
obligation on a nonsubscriber to compensate an employee for injuries sustained
due to the employer’s own negligence, we find that the exclusion is not
applicable. Accordingly, we AFFIRM the district court’s summary judgment in
favor of defendants-appellees.
United States Court of Appeals
Fifth Circuit
F I L E D
September 21, 2010
Lyle W. Cayce
Clerk
Case: 08-11052 Document: 00511239102 Page: 1 Date Filed: 09/21/2010
No. 08-11052
I.
Plaintiff-Appellant American International Specialty Lines Insurance Co.
(“AISLIC”) appeals from the district court’s summary judgment in favor of
defendants, holding that AISLIC’s umbrella insurance policy (“the AISLIC
policy”), issued to Rentech Boiler Systems, Inc., covered the negligence claims
that Preston Teel, Lesa Crosswhite, and Jennings Teel (“the Teels”) asserted
against Rentech Steel, L.L.C. in the underlying litigation and the resulting
judgment. Rentech Steel, Rentech Boiler Systems, Inc., and Renz Family
Partnership, Ltd. are entities under the control of or owned by a common
owner/entity. Rentech Steel, a nonsubscriber to the Texas workers’
compensation insurance system, maintained both a primary indemnity policy,
which is not implicated in this case, and the AISLIC Policy. Rentech Steel
shared the AISLIC Policy with Rentech Boiler Systems, a subscriber to the
workers’ compensation system, but they maintained separate primary policies
due to their differing statuses in relation to the workers’ compensation system.
The underlying litigation commenced when sixteen-year-old Preston Teel
sustained severe injuries while working at Rentech Steel’s manufacturing
facility in Abilene, Texas. Following the incident, the Teels sued Rentech Steel
in state court for gross negligence, negligence, and negligence per se. Lexington
Insurance Company, Rentech Steel’s primary insurer, initially defended Rentech
Steel in the litigation. But after Lexington Insurance denied further coverage,
AISLIC assumed Rentech Steel’s defense as the umbrella insurer. A few weeks
before trial was to begin, AISLIC sought a declaratory judgment that it had no
obligation to defend or indemnify Rentech Steel in the lawsuit. On the first day
of trial, Rentech Steel entered Chapter 7 bankruptcy. According to Rentech
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No. 08-11052
Steel, the bankruptcy was necessary because AISLIC would not pay for the suit.
The bankruptcy court, however, lifted the stay and permitted the case to proceed
to trial on the condition that any recovery would be limited to the proceeds of the
AISLIC insurance policy.
The jury found for the Teels on their negligence and negligence per se
claims, but it did not find gross negligence on the part of Rentech Steel. The
court then entered a judgment against Rentech Steel for $12,470,000 in actual
damages, which was reduced to $10,570,000 after applying a settlement credit.
Rentech Steel has appealed the judgment, and AISLIC has continued to defend
Rentech Steel under a reservation of rights during the appeal. As a consequence
of the state-court judgment, the Teels became proper claimants to Rentech
Steel’s insurance policy.
Shortly after the state court entered its judgment, AISLIC filed a
declaratory judgment action in federal court seeking to establish that it had no
duty to either defend Rentech Steel in the underlying state-court lawsuit or to
indemnify Rentech Steel for the judgment because the AISLIC policy’s “Various
Laws” exclusion excluded coverage for any “obligation of the Insured under . . .
any workers’ compensation, disability benefits, or unemployment compensation
law, or any similar law.” AISLIC moved for summary judgment, arguing that
a negligence claim filed against a nonsubscribing employer is an obligation
arising under the TWCA, not state common law, so the Teels’ judgment against
Rentech Steel was necessarily an “obligation” under Texas’s workers’
compensation law—an obligation explicitly excluded from coverage under the
“Various Laws” exclusion. The Teels and Rentech Steel opposed AISLIC’s
motion.
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No. 08-11052
The district court denied AISLIC’s summary-judgment motion, holding
that the judgment against Rentech Steel did not fall within the Policy’s “Various
Laws” exclusion. The order explained that, although the TWCA deprives
appellees of the right to assert a common-law negligence or negligence per se
claim against a subscribing employer, the Act imposed no “obligation” on a
nonsubscribing employer to compensate an employee for injuries resulting from
the employer’s negligence, but merely limited an employer’s defenses against an
employee’s common-law claims. Alternatively, the court held that, because the
“Various Laws” exclusion was ambiguous, Texas law required that the exclusion
be interpreted against AISLIC and in favor of coverage where appellees’
interpretation of the exclusion was reasonable.
Following the district court’s denial of AISLIC’s motion for summary
judgment, appellees filed for summary judgment on the ground that the AISLIC
policy’s “Various Laws” exclusion did not bar coverage of the judgment against
Rentech Steel, which the district court granted. This appeal followed.
II.
We review a district court’s summary judgment de novo, applying the same
legal standards that the district court applied, viewing the evidence in the light
most favorable to the nonmoving party. Am. Int’l Specialty Lines Ins. Co. v.
Canal Indem. Co., 352 F.3d 254, 259–60 (5th Cir. 2003). We affirm “only if
there is no genuine issue of material fact and one party is entitled to prevail as
a matter of law.” Cedyco Corp. v. PetroQuest Energy, LLC, 497 F.3d 485, 488
(5th Cir. 2007) (citations omitted). Where, as here, parties have filed crossmotions
for summary judgment, each motion must be considered separately
because each movant bears the burden of showing that no genuine issue of
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material fact exists and that it is entitled to a judgment as a matter of law.
Shaw Constructors v. ICF Kaiser Engr’s, Inc., 395 F.3d 533, 538–39 (5th Cir.
2004).
III.
At issue in this case is whether an employee’s negligence action against an
employer that does not subscribe to the Texas workers’ compensation system is
an “obligation” under the TWCA, such that it is excluded under the AISLIC
Policy’s “Various Laws” exclusion. The AISLIC Policy’s “Various Laws”
exclusion provides:
This insurance does not apply to any obligation of the Insured
under any of the following:
1. the Employee Retirement Income Security Act of 1974
(including amendments relating to the Consolidated
Omnibus Budget Reconciliation Act of 1985), or any
amendment or revision thereto, or any similar law; or
2. any workers’ compensation, disability benefits or
unemployment compensation law, or any similar law.
Because Texas law governs this claim, we employ the principles of Texas
contract construction in interpreting the “Various Laws” exclusion. Texas law
provides that insurance policies are construed according to common principles
governing the construction of contracts, and the interpretation of an insurance
policy is a question of law for a court to determine. New York Life Ins. Co. v.
Travelers Ins. Co., 92 F.3d 336, 338 (5th Cir. 1996). Limiting our inquiry to the
four corners of the underlying complaint and the four corners of the insurance
policy, we interpret the contract to discern the intention of the parties from the
language expressed in the policy. See Amerisure Ins. Co. v. Navigators Ins.
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Co., 611 F.3d 299, 309 (5th Cir. 2010). “No single provision taken alone will be
given controlling effect; rather, all the provisions must be considered with
reference to the whole instrument.” See Coker v. Coker, 650 S.W.2d 391, 393
(Tex. 1983) (citations omitted). Where, as here, the disputed provision is an
exclusion, the insurer bears the burden of establishing that the exclusion
applies. Guaranty Nat’l Ins. Co. v. Vic Mfg. Co., 143 F.3d 192, 193 (5th Cir.
1998).
Whether a contract is ambiguous is a question of law. Kelley-Coppedge,
Inc. v. Highlands Ins. Co., 980 S.W.2d 462, 464 (Tex. 1998). An ambiguity does
not arise simply because the parties present conflicting interpretations; it “exists
only if the contractual language is susceptible to two or more reasonable
interpretations.” Am. Mfrs. Mut. Ins. Co. v. Schaefer, 124 S.W.3d 154, 157 (Tex.
2003) (citation omitted). “If policy language is worded so that it can be given a
definite or certain legal meaning, it is not ambiguous,” and the court construes
it as a matter of law without admitting evidence for the purpose of creating an
ambiguity. Id.; see Univ. C.I.T. Credit Corp. v. Daniel, 243 S.W.2d 154, 157 (Tex.
1951). But if the policy language is ambiguous, we construe it “strictly against
the insurer and liberally in favor of the insured,” Barnett v. Aetna Life Ins. Co.,
723 S.W.2d 663, 666 (Tex. 1987), and an “even more stringent construction is
required” where the ambiguity pertains to an “exception or limitation on [the
insured’s] liability under the policy,” Gulf Chem. & Metallurgical Corp. v.
Associated Metals & Minerals Corp., 1 F.3d 365, 369 (5th Cir. 1993).
Consequently, we must adopt the “construction of an exclusionary clause urged
by the insured as long as that construction is not itself unreasonable, even if the
construction urged by the insurer appears to be more reasonable or a more
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No. 08-11052
accurate reflection of the parties’ intent.” Glover v. Nat’l Ins. Underwriters, 545
S.W.2d 755, 761 (Tex. 1977).
Employing these principles, we find no ambiguity in the language of the
“Various Laws” exclusion. The exclusion plainly excludes from coverage only
those legal obligations imposed by “any workers’ compensation . . . law.” This
provision is straightforward. If Texas’s workers’ compensation law imposes a
duty upon Rentech Steel to compensate the Teels for the injuries Preston Teel
incurred due to Rentech Steel’s negligence, the exclusion applies and bars
coverage. Hence, the only question before the court concerns the proper
interpretation of Texas law: does the TWCA obligate a nonsubscribing employer
to compensate an employee for injuries sustained as a result of the employer’s
own negligence, or is such compensation a duty under Texas common law? 1
IV.
AISLIC and appellees disagree on two fundamental aspects of Texas law:
(1) whether an employee’s negligence claim against a nonsubscribing employer
arises under the TWCA or common law, and (2) if it arises under the TWCA,
whether the TWCA imposes an “obligation” upon a nonsubscriber to compensate
an employee for injuries caused by its own negligence. AISLIC contends that the
provision of the TWCA addressing negligence actions against nonsubscribers,
codified at section 406.033 of the Texas Labor Code, wholly supplanted the Texas
common-law claim with a statutory claim. According to AISLIC, because the
TWCA creates the cause of action under which the Teels sued Rentech Steel for
Although AISLIC challenges both its duties to indemnify and defend Rentech Steel, 1
which are separate duties creating separate causes of action under Texas law, see Amerisure,
611 F.3d at 309–10, the parties agree that the applicability of the “Various Laws” exclusion
is determinative of whether AISLIC owes both duties.
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No. 08-11052
negligence, the TWCA necessarily imposes an obligation on Rentech Steel to pay
the Teels’ judgment. AISLIC premises its theory on the fact that section 406.033
deprives nonsubscribing employers of certain defenses available at common law
and sets out an employee’s burden of proof in negligence cases. Tex. Labor Code
§ 406.033 (b), (c).
Appellees contend that AISLIC can prove neither that the TWCA creates
the cause of action for negligence against a nonsubscriber, nor that section
406.033 imposes any “obligation” on a nonsubscriber to pay a judgment to an
employee for injuries caused by negligence. According to appellees, rather than
displacing the common law, section 406.033 “simply leaves the common law
intact with one modification: as a carrot-and-stick incentive to participate in the
compensation program, the TWCA deprives nonsubscribers of some traditional
common-law defenses.” But regardless of what law creates the cause of action,
appellees argue that section 406.033 is devoid of any language creating an
“obligation” for nonsubscribing employers to compensate employees for accidents
resulting from negligence, so the exclusion does not apply.
Where, as here, the proper resolution of the case turns on the
interpretation of Texas law, we “are bound to apply [Texas] law as interpreted
by the state’s highest court.” Barfield v. Madison Cnty., Miss., 212 F.3d 269,
271–72 (5th Cir. 2000). Because the Texas Supreme Court has never ruled on
whether the Texas Workers’ Compensation Act “obligates” a nonsubscribing
employer to compensate an employee for injuries sustained due to employer
negligence, we must make an “Erie guess” as to how the Texas Supreme Court
would rule upon the issue based on
(1) decisions of the [Texas] Supreme Court in analogous cases, (2)
the rationales and analyses underlying [Texas] Supreme Court
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decisions on related issues, (3) dicta by the [Texas] Supreme Court,
(4) lower state court decisions, (5) the general rule on the question,
(6) the rulings of courts of other states to which [Texas] courts look
when formulating substantive law and (7) other available sources,
such as treatises and legal commentaries.
Hodges v. Mack Trucks, Inc., 474 F.3d 188, 199 (5th Cir. 2006) (quoting
Centennial Ins. Co. v. Ryder Truck Rental, Inc., 149 F.3d 378, 382 (5th Cir.
1998)).
Turning first to the text of section 406.033, nothing in the text indicates
that the Texas Legislature intended to impose a legal “obligation” on a
nonsubscriber to compensate an injured employee. The statute simply specifies
that, “[i]n an action against an employer who does not have workers’
compensation insurance coverage to recover damages for personal injuries or
death sustained by an employee in the course and scope of employment,” the
defendant employer is deprived of certain defenses available at common law,
though other defenses remain available. § 406.033(a), (b). It also clarifies that
the common-law negligence standard continues to apply: “the plaintiff must
prove negligence of the employer or of an agent or servant of the employer acting
within the general scope of an agent’s or servant’s employment.” § 406.033(c).
Although we believe that this statute, on its face, does no more than
modify the defenses available at common law, and does not create a cause of
action that usurps the common-law cause of action, we “are emphatically not
permitted to do merely what we think best; we must do that which we think the
[Texas] Supreme Court would deem best.” Jackson v. Johns-Manville Sales
Corp., 781 F.2d 394, 397 (5th Cir. 1986) (en banc). Thus, we consider the
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relevant authorities to determine how the Texas Supreme Court would interpret
section 406.033.
A. Texas Cases
In making our Erie guess, we look first to those Texas Supreme Court
cases that, while not deciding the issue, provide guidance as to how the Texas
Supreme Court would decide the question before us. Our preeminent Erie-guess
authorities, language and decisions from the Texas Supreme Court, suggest that
the court would find that a negligence claim against a nonsubscriber is a
common-law claim, and that section 406.033 imposes no “obligation” upon
Rentech Steel to pay the Teels’ judgment. The Texas Supreme Court in Kroger
Company v. Keng, 23 S.W.3d 347, 349 (Tex. 2009), indicated in dicta that a
negligence claim against a non-subscriber is modified by the TWCA, but remains
a claim at common law. In that case, the court addressed whether Chapter 33
of the Texas Civil Practice and Remedies Code required the district court to
submit a comparative-responsibility question to the jury in a negligence action
against a nonsubscriber, or alternatively, whether section 406.033 prevented the
jury from considering comparative responsibility. The Texas Supreme Court
explained in dicta that the TWCA
allow[s] injured workers, whose employers subscribed to workers’
compensation insurance, to recover without establishing the
employer’s fault and without regard to the employee’s negligence.
In exchange, the employees received a lower, but more certain,
recovery than would have been possible under the common law.
Employers were, however, allowed to opt out of the system, resulting
in their employees retaining their common-law rights. 2
The Texas Supreme Court went on to explain that the purpose of enacting section 2
406.033 was to discourage employers from choosing to opt out by depriving them of certain
traditional common-law defenses to an employee’s negligence action. Kroger, 23 S.W.3d at
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Id. at 349–50 (emphasis added). This suggests that the right to bring a claim
against a nonsubscriber for negligence remains what it has always been—a right
arising under common law.
AISLIC, however, argues that this case supports exactly the opposite
conclusion: that such a claim is an obligation arising under the TWCA because
the TWCA “governs” the negligence cause of action. AISLIC reads Kroger as
“unequivocally stat[ing] that the [TWCA] governs an employee’s personal-injury
claim against a nonsubscribing employer,” as the Texas Supreme Court there
explained that
Labor Code § 406.033, which is part of the Workers’ Compensation
Act, governs an employee’s personal-injury action against his or her
employer, when the employer is a nonsubscriber under the Act.
. . . .
In enacting section 406.033 and its predecessors, the
Legislature intended to delineate explicitly the structure of an
employee’s personal-injury action against his or her nonsubscribing
employer. Section 406.033(a) prescribes the defenses that are
unavailable to a nonsubscriber; section 406.033(c) dictates the
defenses that implicate the employee’s conduct and on which an
employer may rely; and section 406.033(d) provides the employee’s
burden of proof . . . .
23 S.W.3d 347, 349–51 (Tex. 2000). Thus, according to AISLIC, because the
TWCA governs an employee’s negligence claim against a nonsubscriber, it also
provides an obligation for the nonsubscriber to compensate the injured employee.
Not so. We agree that this language in Kroger indicates that a negligence
claim against a nonsubscriber must proceed within the parameters delineated
in section 406.033. But it does not follow that simply by virtue of governing the
350.
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claim, the TWCA also “obligates” Rentech Steel to pay the Teels’ judgment.
Many common-law claims are “governed” by statutes of limitations, but those
statutes neither give rise to the cause of action they govern, nor do they obligate
any party to pay a judgment arising from a governed claim. See Texas Civ. Prac.
& Rem. Code § 16.003(a), (b) (providing a two-year statute of limitations for such
common-law claims as trespass, injury to the estate or property of another,
conversion of personal property, taking or detaining the personal property of
another, personal injury, and forcible entry and detainer); Porterfield v. Ethicon,
Inc., 183 F.3d 464, 467 (5th Cir. 1999) (citing section 16.003(a) for the premise
that “a two-year statute of limitations governs personal injury actions.”
(emphasis added)). Because it is clear that AISLIC’s chain of logical
assumptions is missing a key link, we must conclude that Kroger provides no
support for AISLIC’s theory.
Moreover, in Kroger, the Texas Supreme Court explicitly declined to adopt
the appellate court’s reasoning, favorable to AISLIC, that a suit against a
nonsubscriber is “‘an action to collect workers’ compensation benefits under the
workers compensation laws of this state.’” See Kroger, 23 S.W.3d at 352 (quoting
Texas Civ. Prac. & Rem. Code § 33.002(c)(1)). The court reserved that question
for another day, and instead affirmed the appellate court’s decision that no
comparative-responsibility jury instruction was required on the ground that no
such jury instruction was possible because section 406.033 precludes a finding
of comparative responsibility. Id. Thus, we do not read Kroger to suggest that
the TWCA imposes an obligation on Rentech Steel to compensate the Teels for
Preston’s injuries.
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Further, the Texas Supreme Court’s decision in Fairfield Insurance Co. v.
Stephens Martin Paving, L.P., demonstrates that, even where the TWCA sets
certain parameters on an employee’s claim against a nonsubscriber, it does not
necessarily transform the claim into an obligation under the TWCA. 246 S.W.3d
653, 659 (Tex. 2008). In Fairfield, the Texas Supreme Court held that the
standard-form employers’ liability policy—the same policy AISLIC issued to
Rentech Steel, containing the very same “Various Laws” exclusion—did not
exclude coverage for claims of gross negligence against nonsubscribers. See id.
This holding is significant because Texas Labor Code section 408.001(b), the
provision of the TWCA governing gross-negligence claims against
nonsubscribers, specifies the employee’s burden of proof in that action: the
employee must prove that the employee’s “death was caused by an intentional
act or omission of the employer or by the employer’s gross negligence.” Tex. 3
Lab. Code § 408.001(b). Fairfield thus belies AISLIC’s contention that section
406.033 subsumed the common law because it “specif[ies] the employee’s burden
of proof and the defenses available to the employer.” Where the TWCA provides
the employee’s burden of proof for both gross-negligence and negligence claims,
and the former are unquestionably covered by the insurance policy, the statute’s
provision of the employee’s burden of proof cannot provide the basis for a
contrary result here.
Though the decisions and dicta of the Texas Supreme Court weigh more
heavily in our Erie analysis, we also consider those decisions of Texas appellate
courts in determining how the Texas Supreme Court would rule on this issue.
Further, section 408.001 goes on to define “gross negligence” as “the meaning assigned 3
by Section 41.001, Civil Practices and Remedies Code.” Tex. Lab. Code § 408.001(c).
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AISLIC invites us to follow Robertson v. Home State County Mutual Insurance
Company, —S.W.3d—, 2010 WL 2813488 (Tex. App.—Ft. Worth, 2010, no pet.),
which held that the employee’s judgment for damages against his
nonsubscribing employer was an “obligation” under workers’ compensation law,
excluded from coverage by the “Various Laws” exclusion in his employer’s
liability policy. We decline this invitation, as Robertson is inconsistent with 4
both the relevant Texas Supreme Court caselaw and the plain reading of section
406.033. See Warfield v. Byron, 436 F.3d 551, 558 (5th Cir. 2006) (finding that,
where authorities were split, the Texas Supreme Court would adopt the view
that was most consistent with the “plain reading” of the statute).
We consider Robertson to be unpersuasive because it conflates “governs”
with “obligates,” and because it fails to account for the Texas Supreme Court’s
decision in Fairfield. See Robertson, 2010 WL 2813488, at *5. The Robertson
court grounded its holding that no coverage existed on the statute’s provision of
the plaintiff’s burden of proof, id. at *7. This conflicts, however, with Fairfield’s
holding that the standard employers’ liability policy covered claims for gross
negligence, though the TWCA sets the standard of proof for those claims as well,
See Fairfield, 246 S.W.3d at 657. We are convinced by the plain language of
section 406.033 and by Fairfield that the Texas Supreme Court would not follow
Robertson, so we do not defer to it. Mem’l Hermann Healthcare Sys., Inc., v.
Eurocopter Deutschland, GMBH, 524 F.3d 676, 678 (5th Cir. 2008) (explaining
that we need not defer to an intermediate state appellate court decision where
we are “convinced by other persuasive data that the highest court of the state
But see In re Autotainment Partners, 183 S.W.3d 532, 537 (Tex. App.—Houston [14th 4
Dist.] 2006, no pet.) (holding that a negligence claim against a nonsubscriber for workers’
compensation benefits does not arise under the TWCA).
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would decide otherwise.”); see also Warfield, 436 F.3d at 558 (holding that the
Texas Supreme Court would follow those decisions that were most consistent
with the “plain reading” of the statute).
B. Decisions From Other Courts
Although Texas cases provide greater guidance for our Erie analysis, we
may likewise “consider, among other sources, treatises, decisions from other
jurisdictions, and the ‘majority rule.’” SMI Owen Steel Co. v. Marsh USA, Inc.,
520 F.3d 432, 437 (5th Cir. 2008) (citation omitted); see also Amerisure Ins. Co.
v. Navigators Ins. Co., 611 F.3d 299, 311 (5th Cir. 2010). Here, we have the
benefit of a number of federal cases interpreting the TWCA, and we consider 5
these cases in determining whether the Texas Supreme Court would conclude
that section 406.033 imposes an obligation on Rentech Steel to pay the Teels’
judgment.
We generally consider decisions from other states to the extent they are relevant, but 5
the decisions AISLIC submits are largely inapposite because, unlike most other states, Texas
grants employers the right to choose whether to participate in the workers’ compensation
system. In AISLIC’s cases, the courts considered how nonsubscribers were acting illegally
under state law, but Rentech Steel is not similarly situated. See Indian Harbor Ins. Co. v.
Williams, 998 So. 2d 677, 678–79 (Fla. Ct. App. 2009); Weger v. United Fire & Cas. Co., 796
P.2d 72, 74 (Colo. Ct. App. 1990); Hanover Ins. Co. v. Ramsey, 539 N.E.2d 537, 538 (Mass.
1989); Florida Ins. Guar. Ass’n v. Revoredo, 698 So. 2d 890, 892–93 (Fla. Ct. App. 1997);
Tri-State Constr., Inc. v. Columbia Cas. Co., 692 P.2d 899, 903 (Wash. App. 1984); cf. Liberty
Mut. Ins. Co. v. United Nat’l Ins. Co., 731 P.2d 167, 168–70 (Haw. 1987) (addressing a different
issue).
In states where employers are compelled to participate in the workers’ compensation
system, there is a stronger argument that employers who fail to participate in the mandatory
system are nevertheless “obligat[ed]” by law to compensate injured employees. See 21 Eric
Mills Holmes & Mark S. Rhodes, Holmes’ Appleman on Insurance 2d, § 132.5 (Lexis Nexis ed.
2002) (“The [policy] exclusion excludes ‘any obligation’ of the insured under a workers’
compensation, disability benefits, or unemployment compensation, or any similar law.
Including the word ‘obligation’ means that no coverage applies when (1) an insured has
statutory coverage and it applies to a loss or (2) an insured should have obtained the statutory
protection that applies to a loss.”).
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We begin this analysis by considering Middleton v. Texas P&L Co., a
Supreme Court decision examining the TWCA only a few years following its
1913 enactment. 249 U.S. 152 (1919). The TWCA withstood constitutional
challenge in the Texas Supreme Court in 1916, but with United States Supreme 6
Court review imminent, the Texas Legislature amended the Act while the appeal
was pending to allow workers to forego workers’ compensation remedies and
thereby retain their common-law rights of action. See Ferguson v. Hosp. Corp.
Int’l, 769 F.2d 268, 271 (5th Cir. 1985). In 1919, the Supreme Court affirmed
the Texas Supreme Court and held that the statute was constitutional.
Middleton, 249 U.S. at 155. In describing the Act, the Court explained that the
TWCA shielded employers from common-law suits, but “[e]mployers who do not
become subscribers are subject as before to suits for damages based on
negligence.” Id. (emphasis added). Negligence suits preceding the enactment of
the TWCA were unquestionably suits under common law. Therefore, the
Supreme Court’s statement leaves little doubt that it interpreted the TWCA as
not fundamentally changing the characterization of common-law negligence
claims against nonsubscribers.
We are also guided by those federal decisions that have considered the
question whether an action against a nonsubscriber arises under common law
or the TWCA. Rentech Steel argues that we should follow Pyle v. Beverly
Enters.-Tex., 826 F. Supp. 206, 209 (N.D. Tex. 1993), holding that negligence
Middleton v. Texas P. & L. Co., 185 S.W. 556, 561-62 (1916) (rejecting an employee’s 6
challenge that the statute’s requirement that he accept compensation under his employer’s
compensation policy in lieu of common-law damages constituted a deprivation of property
without due process in violation of the Fourteenth Amendment).
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claims against nonsubscribers exist independently of the TWCA. In that well- 7
reasoned opinion, Judge Fitzwater considered whether the plaintiff’s negligence
suit against her nonsubscribing employer arose under the TWCA, such that it
was not preempted by ERISA. The court held that they were not so preempted
because the plaintiff’s
state court petition does not seek recovery pursuant to the TWCA.
It clearly alleges common law claims of negligence, intentional
infliction of emotional distress and breach of duty of good faith and
fair dealing. These are not causes of action that are created by the
TWCA; they exist independently. Moreover, the fact that the TWCA
deprives employers of certain defenses to negligence claims does not
mean that claims by employees against nonsubscribing employers
are brought pursuant to the TWCA. See Eurine v. Wyatt Cafeterias,
Inc., 1991 WL 207468 at *2 (N.D. Tex. Aug. 21, 1991) (Sanders, C.J.)
(“A cause of action does not arise under workers’ compensation laws
merely because the workers’ compensation statute deprives the
defendant of certain defenses to the cause of action.”).
Id.
This approach, we believe, is consistent with the Texas Supreme Court’s
approach in Kroger v. Keng, 23 S.W.3d 347 (Tex. 2000), and with the history of
the TWCA, see Nunez, 771 F. Supp. at 167–68 (“When the Texas Legislature put
a workers’ compensation law into effect in 1917 it, for all practical purposes,
abolished the right of an employee to bring a common-law action against an
employer having workers’ compensation insurance coverage. However, the
Legislature preserved the common law right of action for the employees of an
See also Nunez v. Wyatt Cafeterias, Inc., 771 F. Supp.165, 167–68 (N.D. Tex. 1991) 7
(holding that by bringing a cause of action against his nonsubscribing employer, the plaintiff
had “but exercised his common law rights, as those rights have been enhanced by the workers’
compensation laws of Texas”).
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employer who elected not to carry workers’ compensation insurance, and
enhanced those rights by a statutory provision that prevented an employer in
such an action from asserting defenses that theretofore had been available to
employers.”).
AISLIC, however, contends that we must consider those district-court
decisions holding that claims against nonsubscribers are not removable to
federal court under 28 U.S.C. § 1445(c), the federal statute addressing
“nonremovable actions,” because such claims “arise” under the TWCA. See
Figueroa v. Healthmark Partners, 125 F. Supp. 2d 209, 210 (S.D. Tex. 2000); see
also Smith v. Tubal-Cain Indus., Inc., 196 F. Supp. 2d 421, 423 (E.D. Tex. 2001);
Dean v. Tex. Steel Co., 837 F. Supp. 212, 214 (N.D. Tex. 1993). But see Eurine
v. Wyatt Cafeterias, Inc., No. 3-91-0408-H, 1991 WL 207468, at *2 (N.D. Tex.
Aug. 21, 1991) (unpublished) (holding that, for the purposes of section 1445(c),
a negligence action against a nonsubscriber is a common-law claim that does not
arise out of the TWCA). We find these cases to be of limited value because
section 1445(c) does not require the court to determine whether the TWCA
imposes an “obligation” on a nonsubscriber to pay a judgment to an employee
injured as a result of the employer’s negligence. It provides only that “a civil
action in any State court arising under the workmen’s compensation laws of such
state may not be removed to any district court of the United States.”
Further, even if we assume arguendo that a claim that “arises under” the
TWCA becomes an “obligation” under that law, the section 1445(c) cases
nevertheless remain an imperfect litmus test for how the Texas Supreme Court
would resolve the case before us. This is because of the deference courts afford
to the congressional intent behind the removal statute, which is not applicable
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here. As the district court explained in Figueroa, “Section 1445(c) denotes an
effort by Congress to restrict the district courts’ diversity jurisdiction in order to
relieve the collectively overburdened docket of the federal courts. Courts have
therefore construed section 1445(c) broadly in order to further this purpose.”
Figueroa, 125 F. Supp 2d. at 211 (internal citations omitted). This broad
construction was also apparent in Smith, where the court found that a
negligence claim “aro[se] under” the TWCA simply because “[n]egligence actions
against nonsubscribing employers are expressly contemplated by Texas workers’
compensation law; indeed, several common-law defenses have been eliminated
by statute.” Smith, 196 F. Supp. 2d at 423 (citation omitted). We do not
comment on whether the TWCA’s mere “contemplat[ion]” of a cause of action
provides sufficient justification to deny removal under section 1445(c), but it is
no proof at all that the TWCA actually “obligate[s]” a nonsubscriber to
compensate an employee for negligence-induced injury.
Likewise, Illinois National Insurance Co. v. Hagendorf Construction Co.,
337 F. Supp. 2d 902 (W.D. Tex. 2004), is similarly unpersuasive. In that case,
the court held that a policy exclusion, similar to the one considered here,
excluded coverage for an employee’s negligence claim against a nonsubscriber
because the claim arose under the TWCA. See id. at 905. We are disinclined to 8
follow this decision for four reasons. First, though the Texas appellate court in
Kroger followed the reasoning that the federal district court would later apply
in Hagendorf, the Texas Supreme Court expressly declined to adopt that
reasoning, and decided the case on other grounds. Kroger v. Keng, 23 S.W.3d
The exclusion in Hagendorf excluded “[a]ny obligation for which the insured or the 8
insured’s insurer may be held liable under any workers compensation, disability benefits or
unemployment compensation law or any similar law.” Hagendorf, 337 F. Supp. 2d at 904.
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347 (Tex. 2000). This inspires little confidence that the court would opt to follow
that decision in this instance. Second, Hagendorf’s holding is grounded on
Figueroa, Smith, and Dean—decisions that were decided using a broad
construction of the term “arising under,” a construction that we do not apply
here. Illinois Nat’l, 337 F. Supp. 2d at 905 (citing Figueroa,125 F. Supp. 2d 209;
Smith, 196 F. Supp. 2d 421; Dean, 837 F. Supp. 212). Third, just as in the
removal cases, Hagendorf held that the exclusion applied because the negligence
claims were “commenced pursuant” to the TWCA, but this reasoning does not
hold water. The text of the exclusion does not purport to exclude claims
“commenced pursuant” to any workers’ compensation law. The language
required the court to determine whether the TWCA actually imposed an
obligation on the nonsubscriber to compensate an employer for injuries caused
by negligence. The court did not do so.9
Finally, we find Hagendorf unreliable because the three decisions upon
which the court premised its holding—Figueroa, Smith, and Dean—derive their
respective holdings, at least in part, from a misreading of Foust v. City Insurance
Co, 704 F. Supp. 752 (W.D. Tex. 1989) (Gee, J., sitting by designation). These
courts interpreted Foust’s language—that employers “depart the general
common-law tort system” upon hiring workers regardless of whether they choose
to subscribe to the workers’ compensation system—as implying that the
common-law claims had been extinguished. Id. at 753; see also Figueroa, 125 F.
Supp. 2d at 211 (quoting Foust, 704 F. Supp. at 753); Smith, 196 F. Supp. 2d at
423 (same); Dean, 837 F. Supp. at 214 (same). This interpretation conflicts with
For these same reasons, we 9 are not persuaded by Markel Insurance Company, Inc. v.
Spirit of Texas Cheer & Gymnastics, No. 4:08-CV-758-Y, 2010 WL 3283051 (N.D. Tex. Aug. 19,
2010), which followed Hagendorf. See id. at *6.
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Foust’s language just sentences later: depending on whether an employer
subscribed to the workers’ compensation system, the TWCA either “admitted
[the employer] to the worker’s compensation system or removed its defenses and
relegated it to Texas common law, shorn of [its] defenses.” Foust, 704 F. Supp.
at 753 (emphasis added). Accordingly, we hold that a negligence claim against
a nonsubscriber is not an “obligation” imposed by the TWCA.
V.
Alternatively, assuming arguendo that the “Various Laws” exclusion is
ambiguous, summary judgment for appellees would still be proper if their
interpretation of the exclusion is reasonable. See Amerisure 10 Ins. Co. v.
Navigators Ins. Co., 611 F.3d 299, 309 (5th Cir. 2010) (explaining that we must
adopt the “interpretation of the exclusionary clause urged by the insured if it is
‘not itself unreasonable,’ even if the insurer’s interpretation seems ‘more
reasonable or a more accurate reflection of the parties’ intent.’” (citation
omitted)). The district court stated in its alternative holding that the phrase
“any obligation . . . under any workers’ compensation . . . law” could be
We reject AISLIC’s argument that the district court was prohibited from finding 10
ambiguity sua sponte, as we have previously held that “[t]he interpretation of the contract and
determination of ambiguity, however, is a matter of law, and the court ‘may conclude that a
contract is ambiguous even in the absence of such a pleading by either party.’” In re Newell
Indus., Inc., 336 F.3d 446, 449 n.5 (5th Cir. 2003) (quoting Sage St. Assocs. v. Northdale
Constr. Co., 863 S.W.2d 438, 445 (Tex. 1993)). As this court has observed, this scenario rarely
presents itself. Brooks, Tarlton, Gilbert, Douglas & Kressler v. U.S. Fire Ins. Co., 832 F.2d
1358, 1365 (5th Cir. 1987) (citations omitted) (“An allegation of ambiguity. . . is of pivotal
importance. Moreover, ‘[a]s necessity is the mother of invention, so is ambiguity the father of
multiple reasonable constructions, and where lawyers are involved, one never lacks an eager
parent of either gender.’ . . . It is interesting, therefore, that the allegation of ambiguity in this
case came, not from the parties, but from the district court.”).
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interpreted to incorporate only workers’ compensation benefits, not a judgment
in a negligence suit. It explained that
the “Various Laws”exclusion could be interpreted as only excluding
claims already covered by workers’ compensation benefits rather
than excluding all claims of employees, whether filed to collect
workers’ compensation benefits or damages by common-law. In such
a case, there is more than one plausible interpretation of the
“Various Laws” exclusion. Thus, applying the provisions of the
“Various Laws” exclusion to the dispute before the Court produces
an uncertain or ambiguous result, and the exclusion will be
interpreted against AISLIC and in favor of coverage.
We agree with the district court that an “obligation” under “workers’
compensation law” could be interpreted to refer only to benefits paid by the
workers’ compensation system, as the meaning of the term obligation has “many,
wide, and varied meanings” that depends on the context in which the word is
used. See Black’s Law Dictionary (9th ed. 2009). Where negligence claims
against nonsubscribers, at least traditionally, have been recognized as arising
under common law, we conclude that it is reasonable to interpret the “Various
Laws” exclusion to exclude only mandatory benefit payments.
CONCLUSION
In summary, AISLIC has failed to meet its burden of proving that the
“Various Laws” exclusion bars coverage of the Teels’ claims and the judgment
against Rentech Steel. AISLIC has not shown that the Texas Supreme Court
would conclude either that a negligence claim against a nonsubscriber arises
under the TWCA rather than common law, or that Texas Labor Code section
406.033 imposes any obligation upon Rentech Steel to pay the Teels’ judgment.
For these reasons, we AFFIRM the judgment of the district court.
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Williams, McClure & Parmelee is dedicated to high quality legal representation of businesses and insurance companies in a variety of matters. We are experienced Texas civil litigation attorneys based in Fort Worth who know Texas courts and Texas law. For more information, please contact the law firm at 817-335-8800. The firm’s new office location is 5601 Bridge Street, Suite 300, Fort Worth, Texas 76112.
Williams, McClure & Parmelee is dedicated to high quality legal representation of businesses and insurance companies in a variety of matters. We are experienced Texas civil litigation attorneys based in Fort Worth who know Texas courts and Texas law. For more information, please contact the law firm at 817-335-8800. The firm’s new office location is 5601 Bridge Street, Suite 300, Fort Worth, Texas 76112.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 735, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 41.001. DEFINITIONS. In this chapter:
(1) “Claimant” means a party, including a plaintiff, counterclaimant, cross-claimant, or third-party plaintiff, seeking recovery of damages. In a cause of action in which a party seeks recovery of damages related to injury to another person, damage to the property of another person, death of another person, or other harm to another person, “claimant” includes both that other person and the party seeking recovery of damages.
(2) “Clear and convincing” means the measure or degree of proof that will produce in the mind of the trier of fact a firm belief or conviction as to the truth of the allegations sought to be established.
(3) “Defendant” means a party, including a counterdefendant, cross-defendant, or third-party defendant, from whom a claimant seeks relief.
(4) “Economic damages” means compensatory damages intended to compensate a claimant for actual economic or pecuniary loss; the term does not include exemplary damages or noneconomic damages.
(5) “Exemplary damages” means any damages awarded as a penalty or by way of punishment but not for compensatory purposes. Exemplary damages are neither economic nor noneconomic damages. ‘Exemplary damages’ includes punitive damages.
(6) “Fraud” means fraud other than constructive fraud.
(7) “Malice” means a specific intent by the defendant to cause substantial injury or harm to the claimant.
(8) “Compensatory damages” means economic and noneconomic damages. The term does not include exemplary damages.
(9) “Future damages” means damages that are incurred after the date of the judgment. Future damages do not include exemplary damages.
(10) “Future loss of earnings” means a pecuniary loss incurred after the date of the judgment, including:
(A) loss of income, wages, or earning capacity; and
(B) loss of inheritance.
(11) “Gross negligence” means an act or omission:
(A) which when viewed objectively from the standpoint of the actor at the time of its occurrence involves an extreme degree of risk, considering the probability and magnitude of the potential harm to others; and
(B) of which the actor has actual, subjective awareness of the risk involved, but nevertheless proceeds with conscious indifference to the rights, safety, or welfare of others.
(12) “Noneconomic damages” means damages awarded for the purpose of compensating a claimant for physical pain and suffering, mental or emotional pain or anguish, loss of consortium, disfigurement, physical impairment, loss of companionship and society, inconvenience, loss of enjoyment of life, injury to reputation, and all other nonpecuniary losses of any kind other than exemplary damages.
(13) “Periodic payments” means the payment of money or its equivalent to the recipient of future damages at defined intervals.
Added by Acts 1987, 70th Leg., 1st C.S., ch. 2, Sec. 2.12, eff. Sept. 2, 1987. Amended by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995; Acts 2003, 78th Leg., ch. 204, Sec. 13.02, eff. Sept. 1, 2003.
Sec. 41.002. APPLICABILITY. (a) This chapter applies to any action in which a claimant seeks damages relating to a cause of action.
(b) This chapter establishes the maximum damages that may be awarded in an action subject to this chapter, including an action for which damages are awarded under another law of this state. This chapter does not apply to the extent another law establishes a lower maximum amount of damages for a particular claim.
(c) Except as provided by Subsections (b) and (d), in an action to which this chapter applies, the provisions of this chapter prevail over all other law to the extent of any conflict.
(d) Notwithstanding any provision to the contrary, this chapter does not apply to:
(1) Section 15.21, Business & Commerce Code (Texas Free Enterprise and Antitrust Act of 1983);
(2) an action brought under the Deceptive Trade Practices-Consumer Protection Act (Subchapter E, Chapter 17, Business & Commerce Code) except as specifically provided in Section 17.50 of that Act;
(3) an action brought under Chapter 36, Human Resources Code; or
(4) an action brought under Chapter 21, Insurance Code.
Added by Acts 1987, 70th Leg., 1st C.S., ch. 2, Sec. 2.12, eff. Sept. 2, 1987. Amended by Acts 1989, 71st Leg., ch. 380, Sec. 5, eff. Sept. 1, 1989; Acts 1989, 71st Leg., ch. 1129, Sec. 16, eff. Sept. 1, 1989; Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995; Acts 1995, 74th Leg., ch. 260, Sec. 9, eff. May 30, 1995; Acts 1997, 75th Leg., ch. 165, Sec. 4.01, eff. Sept. 1, 1997; Acts 2003, 78th Leg., ch. 204, Sec. 13.03, eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 806 (S.B. 563), Sec. 18, eff. September 1, 2005.
Sec. 41.003. STANDARDS FOR RECOVERY OF EXEMPLARY DAMAGES. (a) Except as provided by Subsection (c), exemplary damages may be awarded only if the claimant proves by clear and convincing evidence that the harm with respect to which the claimant seeks recovery of exemplary damages results from:
(1) fraud;
(2) malice; or
(3) gross negligence.
(b) The claimant must prove by clear and convincing evidence the elements of exemplary damages as provided by this section. This burden of proof may not be shifted to the defendant or satisfied by evidence of ordinary negligence, bad faith, or a deceptive trade practice.
(c) If the claimant relies on a statute establishing a cause of action and authorizing exemplary damages in specified circumstances or in conjunction with a specified culpable mental state, exemplary damages may be awarded only if the claimant proves by clear and convincing evidence that the damages result from the specified circumstances or culpable mental state.
(d) Exemplary damages may be awarded only if the jury was unanimous in regard to finding liability for and the amount of exemplary damages.
(e) In all cases where the issue of exemplary damages is submitted to the jury, the following instruction shall be included in the charge of the court:
“You are instructed that, in order for you to find exemplary damages, your answer to the question regarding the amount of such damages must be unanimous.”
Added by Acts 1987, 70th Leg., 1st C.S., ch. 2, Sec. 2.12, eff. Sept. 2, 1987. Amended by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995; Acts 2003, 78th Leg., ch. 204, Sec. 13.04, eff. Sept. 1, 2003.
Sec. 41.004. FACTORS PRECLUDING RECOVERY. (a) Except as provided by Subsection (b), exemplary damages may be awarded only if damages other than nominal damages are awarded.
(b) Exemplary damages may not be awarded to a claimant who elects to have his recovery multiplied under another statute.
Added by Acts 1987, 70th Leg., 1st C.S., ch. 2, Sec. 2.12, eff. Sept. 2, 1987. Amended by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995; Acts 2003, 78th Leg., ch. 204, Sec. 13.05, eff. Sept. 1, 2003.
Sec. 41.005. HARM RESULTING FROM CRIMINAL ACT. (a) In an action arising from harm resulting from an assault, theft, or other criminal act, a court may not award exemplary damages against a defendant because of the criminal act of another.
(b) The exemption provided by Subsection (a) does not apply if:
(1) the criminal act was committed by an employee of the defendant;
(2) the defendant is criminally responsible as a party to the criminal act under the provisions of Chapter 7, Penal Code;
(3) the criminal act occurred at a location where, at the time of the criminal act, the defendant was maintaining a common nuisance under the provisions of Chapter 125, Civil Practice and Remedies Code, and had not made reasonable attempts to abate the nuisance; or
(4) the criminal act resulted from the defendant’s intentional or knowing violation of a statutory duty under Subchapter D, Chapter 92, Property Code, and the criminal act occurred after the statutory deadline for compliance with that duty.
(c) In an action arising out of a criminal act committed by an employee, the employer may be liable for punitive damages but only if:
(1) the principal authorized the doing and the manner of the act;
(2) the agent was unfit and the principal acted with malice in employing or retaining him;
(3) the agent was employed in a managerial capacity and was acting in the scope of employment; or
(4) the employer or a manager of the employer ratified or approved the act.
Amended by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995.
Sec. 41.006. AWARD SPECIFIC TO DEFENDANT. In any action in which there are two or more defendants, an award of exemplary damages must be specific as to a defendant, and each defendant is liable only for the amount of the award made against that defendant.
Added by Acts 1987, 70th Leg., 1st C.S., ch. 2, Sec. 2.12, eff. Sept. 2, 1987. Renumbered from Civil Practice & Remedies Code Sec. 41.005 by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995.
Sec. 41.007. PREJUDGMENT INTEREST. Prejudgment interest may not be assessed or recovered on an award of exemplary damages.
Added by Acts 1987, 70th Leg., 1st C.S., ch. 2, Sec. 2.12, eff. Sept. 2, 1987. Renumbered from Civil Practice & Remedies Code Sec. 41.006 by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995.
Sec. 41.008. LIMITATION ON AMOUNT OF RECOVERY. (a) In an action in which a claimant seeks recovery of damages, the trier of fact shall determine the amount of economic damages separately from the amount of other compensatory damages.
(b) Exemplary damages awarded against a defendant may not exceed an amount equal to the greater of:
(1)(A) two times the amount of economic damages; plus
(B) an amount equal to any noneconomic damages found by the jury, not to exceed $750,000; or
(2) $200,000.
(c) This section does not apply to a cause of action against a defendant from whom a plaintiff seeks recovery of exemplary damages based on conduct described as a felony in the following sections of the Penal Code if, except for Sections 49.07 and 49.08, the conduct was committed knowingly or intentionally:
(1) Section 19.02 (murder);
(2) Section 19.03 (capital murder);
(3) Section 20.04 (aggravated kidnapping);
(4) Section 22.02 (aggravated assault);
(5) Section 22.011 (sexual assault);
(6) Section 22.021 (aggravated sexual assault);
(7) Section 22.04 (injury to a child, elderly individual, or disabled individual, but not if the conduct occurred while providing health care as defined by Section 74.001);
(8) Section 32.21 (forgery);
(9) Section 32.43 (commercial bribery);
(10) Section 32.45 (misapplication of fiduciary property or property of financial institution);
(11) Section 32.46 (securing execution of document by deception);
(12) Section 32.47 (fraudulent destruction, removal, or concealment of writing);
(13) Chapter 31 (theft) the punishment level for which is a felony of the third degree or higher;
(14) Section 49.07 (intoxication assault);
(15) Section 49.08 (intoxication manslaughter);
(16) Section 21.02 (continuous sexual abuse of young child or children); or
(17) Chapter 20A (trafficking of persons).
(d) In this section, “intentionally” and “knowingly” have the same meanings assigned those terms in Sections 6.03(a) and (b), Penal Code.
(e) The provisions of this section may not be made known to a jury by any means, including voir dire, introduction into evidence, argument, or instruction.
(f) This section does not apply to a cause of action for damages arising from the manufacture of methamphetamine as described by Chapter 99.
Added by Acts 1987, 70th Leg., 1st C.S., ch. 2, Sec. 2.12, eff. Sept. 2, 1987. Renumbered from Civil Practice & Remedies Code Sec. 41.007 and amended by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995. Amended by Acts 2001, 77th Leg., ch. 643, Sec. 3, eff. Sept. 1, 2001; Acts 2003, 78th Leg., ch. 204, Sec. 13.06, eff. Sept. 1, 2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 593 (H.B. 8), Sec. 3.03, eff. September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch. 309 (H.B. 533), Sec. 2, eff. June 19, 2009.
Sec. 41.009. BIFURCATED TRIAL. (a) On motion by a defendant, the court shall provide for a bifurcated trial under this section. A motion under this subsection shall be made prior to voir dire examination of the jury or at a time specified by a pretrial court order issued under Rule 166, Texas Rules of Civil Procedure.
(b) In an action with more than one defendant, the court shall provide for a bifurcated trial on motion of any defendant.
(c) In the first phase of a bifurcated trial, the trier of fact shall determine:
(1) liability for compensatory and exemplary damages; and
(2) the amount of compensatory damages.
(d) If liability for exemplary damages is established during the first phase of a bifurcated trial, the trier of fact shall, in the second phase of the trial, determine the amount of exemplary damages to be awarded, if any.
Amended by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995.
Sec. 41.010. CONSIDERATIONS IN MAKING AWARD. (a) Before making an award of exemplary damages, the trier of fact shall consider the definition and purposes of exemplary damages as provided by Section 41.001.
(b) Subject to Section 41.008, the determination of whether to award exemplary damages and the amount of exemplary damages to be awarded is within the discretion of the trier of fact.
Added by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995. Amended by Acts 2003, 78th Leg., ch. 204, Sec. 13.07, eff. Sept. 1, 2003.
Sec. 41.0105. EVIDENCE RELATING TO AMOUNT OF ECONOMIC DAMAGES. In addition to any other limitation under law, recovery of medical or health care expenses incurred is limited to the amount actually paid or incurred by or on behalf of the claimant.
Added by Acts 2003, 78th Leg., ch. 204, Sec. 13.08, eff. Sept. 1, 2003.
Sec. 41.011. EVIDENCE RELATING TO AMOUNT OF EXEMPLARY DAMAGES. (a) In determining the amount of exemplary damages, the trier of fact shall consider evidence, if any, relating to:
(1) the nature of the wrong;
(2) the character of the conduct involved;
(3) the degree of culpability of the wrongdoer;
(4) the situation and sensibilities of the parties concerned;
(5) the extent to which such conduct offends a public sense of justice and propriety; and
(6) the net worth of the defendant.
(b) Evidence that is relevant only to the amount of exemplary damages that may be awarded is not admissible during the first phase of a bifurcated trial.
Added by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995.
Sec. 41.012. JURY INSTRUCTIONS. In a trial to a jury, the court shall instruct the jury with regard to Sections 41.001, 41.003, 41.010, and 41.011.
Added by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995.
Sec. 41.013. JUDICIAL REVIEW OF AWARD. (a) Except as provided for in Subsection (b), an appellate court that reviews the evidence with respect to a finding by a trier of fact concerning liability for exemplary damages or with respect to the amount of exemplary damages awarded shall state, in a written opinion, the court’s reasons for upholding or disturbing the finding or award. The written opinion shall address the evidence or lack of evidence with specificity, as it relates to the liability for or amount of exemplary damages, in light of the requirements of this chapter.
(b) This section does not apply to the supreme court with respect to its consideration of an application for writ of error.
Added by Acts 1995, 74th Leg., ch. 19, Sec. 1, eff. Sept. 1, 1995.
Sec. 41.014. INTEREST ON DAMAGES SUBJECT TO MEDICARE SUBROGATION. (a) Subject to this section, postjudgment interest does not accrue on the unpaid balance of an award of damages to a plaintiff attributable to any portion of the award to which the United States has a subrogation right under 42 U.S.C. Section 1395y(b)(2)(B) before the defendant receives a recovery demand letter issued by the Centers for Medicare and Medicaid Services or a designated contractor under 42 C.F.R. Section 411.22.
(b) Postjudgment interest under this section does not accrue if the defendant pays the unpaid balance before the 31st day after the date the defendant receives the recovery demand letter.
(c) If the defendant appeals the award of damages, this section does not apply.
(d) This section does not prevent the accrual of postjudgment interest on any portion of an award to which the United States does not have a subrogation right under 42 U.S.C. Section 1395y(b)(2)(B).
Added by Acts 2013, 83rd Leg., R.S., Ch. 870 (H.B. 658), Sec. 1, eff. September 1, 2013.
Williams, McClure & Parmelee is dedicated to high quality legal representation of businesses and insurance companies in a variety of matters. We are experienced Texas civil litigation attorneys based in Fort Worth who know Texas courts and Texas law. For more information, please contact the law firm at 817-335-8800. The firm’s new office location is 5601 Bridge Street, Suite 300, Fort Worth, Texas 76112.
TITLE 10. OFFENSES AGAINST PUBLIC HEALTH, SAFETY, AND MORALS
CHAPTER 46. WEAPONS
Sec. 46.01. DEFINITIONS. In this chapter:
(1) “Club” means an instrument that is specially designed, made, or adapted for the purpose of inflicting serious bodily injury or death by striking a person with the instrument, and includes but is not limited to the following:
(A) blackjack;
(B) nightstick;
(C) mace;
(D) tomahawk.
(2) “Explosive weapon” means any explosive or incendiary bomb, grenade, rocket, or mine, that is designed, made, or adapted for the purpose of inflicting serious bodily injury, death, or substantial property damage, or for the principal purpose of causing such a loud report as to cause undue public alarm or terror, and includes a device designed, made, or adapted for delivery or shooting an explosive weapon.
(3) “Firearm” means any device designed, made, or adapted to expel a projectile through a barrel by using the energy generated by an explosion or burning substance or any device readily convertible to that use. Firearm does not include a firearm that may have, as an integral part, a folding knife blade or other characteristics of weapons made illegal by this chapter and that is:
(A) an antique or curio firearm manufactured before 1899; or
(B) a replica of an antique or curio firearm manufactured before 1899, but only if the replica does not use rim fire or center fire ammunition.
(4) “Firearm silencer” means any device designed, made, or adapted to muffle the report of a firearm.
(5) “Handgun” means any firearm that is designed, made, or adapted to be fired with one hand.
(6) “Illegal knife” means a:
(A) knife with a blade over five and one-half inches;
(B) hand instrument designed to cut or stab another by being thrown;
(C) dagger, including but not limited to a dirk, stiletto, and poniard;
(D) bowie knife;
(E) sword; or
(F) spear.
(7) “Knife” means any bladed hand instrument that is capable of inflicting serious bodily injury or death by cutting or stabbing a person with the instrument.
(8) “Knuckles” means any instrument that consists of finger rings or guards made of a hard substance and that is designed, made, or adapted for the purpose of inflicting serious bodily injury or death by striking a person with a fist enclosed in the knuckles.
(9) “Machine gun” means any firearm that is capable of shooting more than two shots automatically, without manual reloading, by a single function of the trigger.
(10) “Short-barrel firearm” means a rifle with a barrel length of less than 16 inches or a shotgun with a barrel length of less than 18 inches, or any weapon made from a shotgun or rifle if, as altered, it has an overall length of less than 26 inches.
(11) “Switchblade knife” means any knife that has a blade that folds, closes, or retracts into the handle or sheath and that opens automatically by pressure applied to a button or other device located on the handle or opens or releases a blade from the handle or sheath by the force of gravity or by the application of centrifugal force. The term does not include a knife that has a spring, detent, or other mechanism designed to create a bias toward closure and that requires exertion applied to the blade by hand, wrist, or arm to overcome the bias toward closure and open the knife.
(12) “Armor-piercing ammunition” means handgun ammunition that is designed primarily for the purpose of penetrating metal or body armor and to be used principally in pistols and revolvers.
(13) “Hoax bomb” means a device that:
(A) reasonably appears to be an explosive or incendiary device; or
(B) by its design causes alarm or reaction of any type by an official of a public safety agency or a volunteer agency organized to deal with emergencies.
(14) “Chemical dispensing device” means a device, other than a small chemical dispenser sold commercially for personal protection, that is designed, made, or adapted for the purpose of dispensing a substance capable of causing an adverse psychological or physiological effect on a human being.
(15) “Racetrack” has the meaning assigned that term by the Texas Racing Act (Article 179e, Vernon’s Texas Civil Statutes).
(16) “Zip gun” means a device or combination of devices that was not originally a firearm and is adapted to expel a projectile through a smooth-bore or rifled-bore barrel by using the energy generated by an explosion or burning substance.
(17) “Tire deflation device” means a device, including a caltrop or spike strip, that, when driven over, impedes or stops the movement of a wheeled vehicle by puncturing one or more of the vehicle’s tires. The term does not include a traffic control device that:
(A) is designed to puncture one or more of a vehicle’s tires when driven over in a specific direction; and
(B) has a clearly visible sign posted in close proximity to the traffic control device that prohibits entry or warns motor vehicle operators of the traffic control device.
Acts 1973, 63rd Leg., p. 883, ch. 399, Sec. 1, eff. Jan. 1, 1974. Amended by Acts 1975, 64th Leg., p. 917, ch. 342, Sec. 13, eff. Sept. 1, 1975; Acts 1983, 68th Leg., p. 2650, ch. 457, Sec. 1, eff. Sept. 1, 1983; Acts 1983, 68th Leg., p. 4830, ch. 852, Sec. 1, eff. Sept. 1, 1983; Acts 1987, 70th Leg., ch. 167, Sec. 5.01(a)(46), eff. Sept. 1, 1987; Acts 1989, 71st Leg., ch. 749, Sec. 1, eff. Sept. 1, 1989; Acts 1991, 72nd Leg., ch. 229, Sec. 1, eff. Sept. 1, 1991; Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994; Acts 1999, 76th Leg., ch. 1445, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 921 (H.B. 3167), Sec. 12A.001, eff. September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch. 1199 (H.B. 4456), Sec. 1, eff. September 1, 2009.
Acts 2011, 82nd Leg., R.S., Ch. 920 (S.B. 1416), Sec. 1, eff. September 1, 2011.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see H.B. 910, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 46.02. UNLAWFUL CARRYING WEAPONS. (a) A person commits an offense if the person intentionally, knowingly, or recklessly carries on or about his or her person a handgun, illegal knife, or club if the person is not:
(1) on the person’s own premises or premises under the person’s control; or
(2) inside of or directly en route to a motor vehicle or watercraft that is owned by the person or under the person’s control.
(a-1) A person commits an offense if the person intentionally, knowingly, or recklessly carries on or about his or her person a handgun in a motor vehicle or watercraft that is owned by the person or under the person’s control at any time in which:
(1) the handgun is in plain view; or
(2) the person is:
(A) engaged in criminal activity, other than a Class C misdemeanor that is a violation of a law or ordinance regulating traffic or boating;
(B) prohibited by law from possessing a firearm; or
(C) a member of a criminal street gang, as defined by Section 71.01.
(a-2) For purposes of this section, “premises” includes real property and a recreational vehicle that is being used as living quarters, regardless of whether that use is temporary or permanent. In this subsection, “recreational vehicle” means a motor vehicle primarily designed as temporary living quarters or a vehicle that contains temporary living quarters and is designed to be towed by a motor vehicle. The term includes a travel trailer, camping trailer, truck camper, motor home, and horse trailer with living quarters.
(a-3) For purposes of this section, “watercraft” means any boat, motorboat, vessel, or personal watercraft, other than a seaplane on water, used or capable of being used for transportation on water.
(b) Except as provided by Subsection (c), an offense under this section is a Class A misdemeanor.
(c) An offense under this section is a felony of the third degree if the offense is committed on any premises licensed or issued a permit by this state for the sale of alcoholic beverages.
Acts 1973, 63rd Leg., p. 883, ch. 399, Sec. 1, eff. Jan. 1, 1974. Amended by Acts 1975, 64th Leg., p. 109, ch. 49, Sec. 1, eff. April 15, 1975; Acts 1975, 64th Leg., p. 918, ch. 342, Sec. 14, eff. Sept. 1, 1975; Acts 1975, 64th Leg., p. 1330, ch. 494, Sec. 2, eff. June 19, 1975; Acts 1977, 65th Leg., p. 1879, ch. 746, Sec. 26, eff. Aug. 29, 1977; Acts 1981, 67th Leg., p. 2273, ch. 552, Sec. 1, eff. Aug. 31, 1981; Acts 1983, 68th Leg., p. 5113, ch. 931, Sec. 1, eff. Aug. 29, 1983; Acts 1987, 70th Leg., ch. 262, Sec. 21, eff. Sept. 1, 1987; Acts 1987, 70th Leg., ch. 873, Sec. 25, eff. Sept. 1, 1987; Acts 1991, 72nd Leg., ch. 168, Sec. 1, eff. Sept. 1, 1991. Redesignated from Penal Code Sec. 46.02, 46.03 and amended by Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994. Amended by Acts 1995, 74th Leg., ch. 229, Sec. 2, eff. Sept. 1, 1995; Acts 1995, 74th Leg., ch. 318, Sec. 16, eff. Sept. 1, 1995; Acts 1995, 74th Leg., ch. 754, Sec. 15, eff. Sept. 1, 1995; Acts 1995, 74th Leg., ch. 790, Sec. 16, eff. Sept. 1, 1995; Acts 1995, 74th Leg., ch. 998, Sec. 3, eff. Sept. 1, 1995; Acts 1997, 75th Leg., ch. 165, Sec. 10.02, eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch. 1221, Sec. 1, eff. June 20, 1997; Acts 1997, 75th Leg., ch. 1261, Sec. 24, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 693 (H.B. 1815), Sec. 1, eff. September 1, 2007.
Acts 2011, 82nd Leg., R.S., Ch. 679 (H.B. 25), Sec. 1, eff. September 1, 2011.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see H.B. 554, S.B. 11 and H.B. 910, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 46.03. PLACES WEAPONS PROHIBITED. (a) A person commits an offense if the person intentionally, knowingly, or recklessly possesses or goes with a firearm, illegal knife, club, or prohibited weapon listed in Section 46.05(a):
(1) on the physical premises of a school or educational institution, any grounds or building on which an activity sponsored by a school or educational institution is being conducted, or a passenger transportation vehicle of a school or educational institution, whether the school or educational institution is public or private, unless pursuant to written regulations or written authorization of the institution;
(2) on the premises of a polling place on the day of an election or while early voting is in progress;
(3) on the premises of any government court or offices utilized by the court, unless pursuant to written regulations or written authorization of the court;
(4) on the premises of a racetrack;
(5) in or into a secured area of an airport; or
(6) within 1,000 feet of premises the location of which is designated by the Texas Department of Criminal Justice as a place of execution under Article 43.19, Code of Criminal Procedure, on a day that a sentence of death is set to be imposed on the designated premises and the person received notice that:
(A) going within 1,000 feet of the premises with a weapon listed under this subsection was prohibited; or
(B) possessing a weapon listed under this subsection within 1,000 feet of the premises was prohibited.
(b) It is a defense to prosecution under Subsections (a)(1)-(4) that the actor possessed a firearm while in the actual discharge of his official duties as a member of the armed forces or national guard or a guard employed by a penal institution, or an officer of the court.
(c) In this section:
(1) “Premises” has the meaning assigned by Section 46.035.
(2) “Secured area” means an area of an airport terminal building to which access is controlled by the inspection of persons and property under federal law.
(d) It is a defense to prosecution under Subsection (a)(5) that the actor possessed a firearm or club while traveling to or from the actor’s place of assignment or in the actual discharge of duties as:
(1) a member of the armed forces or national guard;
(2) a guard employed by a penal institution; or
(3) a security officer commissioned by the Texas Private Security Board if:
(A) the actor is wearing a distinctive uniform; and
(B) the firearm or club is in plain view; or
(4) a security officer who holds a personal protection authorization under Chapter 1702, Occupations Code, provided that the officer is either:
(A) wearing the uniform of a security officer, including any uniform or apparel described by Section 1702.323(d), Occupations Code, and carrying the officer’s firearm in plain view; or
(B) not wearing the uniform of a security officer and carrying the officer’s firearm in a concealed manner.
(e) It is a defense to prosecution under Subsection (a)(5) that the actor checked all firearms as baggage in accordance with federal or state law or regulations before entering a secured area.
(f) It is not a defense to prosecution under this section that the actor possessed a handgun and was licensed to carry a concealed handgun under Subchapter H, Chapter 411, Government Code.
(g) An offense under this section is a third degree felony.
(h) It is a defense to prosecution under Subsection (a)(4) that the actor possessed a firearm or club while traveling to or from the actor’s place of assignment or in the actual discharge of duties as a security officer commissioned by the Texas Board of Private Investigators and Private Security Agencies, if:
(1) the actor is wearing a distinctive uniform; and
(2) the firearm or club is in plain view.
(i) It is an exception to the application of Subsection (a)(6) that the actor possessed a firearm or club:
(1) while in a vehicle being driven on a public road; or
(2) at the actor’s residence or place of employment.
Acts 1973, 63rd Leg., p. 883, ch. 399, Sec. 1, eff. Jan. 1, 1974. Amended by Acts 1983, 68th Leg., p. 2962, ch. 508, Sec. 1, eff. Aug. 29, 1983; Acts 1989, 71st Leg., ch. 749, Sec. 2, eff. Sept. 1, 1989; Acts 1991, 72nd Leg., ch. 203, Sec. 2.79; Acts 1991, 72nd Leg., ch. 386, Sec. 71, eff. Aug. 26, 1991; Acts 1991, 72nd Leg., ch. 433, Sec. 1, eff. Sept. 1, 1991; Acts 1991, 72nd Leg., ch. 554, Sec. 50, eff. Sept. 1, 1991. Renumbered from Penal Code Sec. 46.04 and amended by Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994. Amended by Acts 1995, 74th Leg., ch. 229, Sec. 3, eff. Sept. 1, 1995; Acts 1995, 74th Leg., ch. 260, Sec. 42, eff. May 30, 1995; Acts 1995, 74th Leg., ch. 318, Sec. 17, eff. Sept. 1, 1995; Acts 1995, 74th Leg., ch. 790, Sec. 17, eff. Sept. 1, 1995; Acts 1997, 75th Leg., ch. 165, Sec. 10.03, 31.01(70), eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch. 1043, Sec. 1, eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch. 1221, Sec. 2, 3, eff. June 20, 1997; Acts 1997, 75th Leg., ch. 1261, Sec. 25, eff. Sept. 1, 1997; Acts 2001, 77th Leg., ch. 1060, Sec. 1, 2 eff. Sept. 1, 2001; Acts 2003, 78th Leg., ch. 1178, Sec. 3, eff. Sept. 1, 2003.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1146 (H.B. 2730), Sec. 4B.21, eff. September 1, 2009.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see H.B. 910, S.B. 11 and S.B. 273, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 46.035. UNLAWFUL CARRYING OF HANDGUN BY LICENSE HOLDER. (a) A license holder commits an offense if the license holder carries a handgun on or about the license holder’s person under the authority of Subchapter H, Chapter 411, Government Code, and intentionally displays the handgun in plain view of another person in a public place.
(b) A license holder commits an offense if the license holder intentionally, knowingly, or recklessly carries a handgun under the authority of Subchapter H, Chapter 411, Government Code, regardless of whether the handgun is concealed, on or about the license holder’s person:
(1) on the premises of a business that has a permit or license issued under Chapter 25, 28, 32, 69, or 74, Alcoholic Beverage Code, if the business derives 51 percent or more of its income from the sale or service of alcoholic beverages for on-premises consumption, as determined by the Texas Alcoholic Beverage Commission under Section 104.06, Alcoholic Beverage Code;
(2) on the premises where a high school, collegiate, or professional sporting event or interscholastic event is taking place, unless the license holder is a participant in the event and a handgun is used in the event;
(3) on the premises of a correctional facility;
(4) on the premises of a hospital licensed under Chapter 241, Health and Safety Code, or on the premises of a nursing home licensed under Chapter 242, Health and Safety Code, unless the license holder has written authorization of the hospital or nursing home administration, as appropriate;
(5) in an amusement park; or
(6) on the premises of a church, synagogue, or other established place of religious worship.
(c) A license holder commits an offense if the license holder intentionally, knowingly, or recklessly carries a handgun under the authority of Subchapter H, Chapter 411, Government Code, regardless of whether the handgun is concealed, at any meeting of a governmental entity.
(d) A license holder commits an offense if, while intoxicated, the license holder carries a handgun under the authority of Subchapter H, Chapter 411, Government Code, regardless of whether the handgun is concealed.
(e) A license holder who is licensed as a security officer under Chapter 1702, Occupations Code, and employed as a security officer commits an offense if, while in the course and scope of the security officer’s employment, the security officer violates a provision of Subchapter H, Chapter 411, Government Code.
(f) In this section:
(1) “Amusement park” means a permanent indoor or outdoor facility or park where amusement rides are available for use by the public that is located in a county with a population of more than one million, encompasses at least 75 acres in surface area, is enclosed with access only through controlled entries, is open for operation more than 120 days in each calendar year, and has security guards on the premises at all times. The term does not include any public or private driveway, street, sidewalk or walkway, parking lot, parking garage, or other parking area.
(2) “License holder” means a person licensed to carry a handgun under Subchapter H, Chapter 411, Government Code.
(3) “Premises” means a building or a portion of a building. The term does not include any public or private driveway, street, sidewalk or walkway, parking lot, parking garage, or other parking area.
(g) An offense under Subsection (a), (b), (c), (d), or (e) is a Class A misdemeanor, unless the offense is committed under Subsection (b)(1) or (b)(3), in which event the offense is a felony of the third degree.
(h) It is a defense to prosecution under Subsection (a) that the actor, at the time of the commission of the offense, displayed the handgun under circumstances in which the actor would have been justified in the use of force or deadly force under Chapter 9.
Text of subsection as added by Acts 2007, 80th Leg., R.S., Ch. 1214 (H.B. 1889), Sec. 2
(h-1) It is a defense to prosecution under Subsections (b) and (c) that the actor, at the time of the commission of the offense, was:
(1) an active judicial officer, as defined by Section 411.201, Government Code; or
(2) a bailiff designated by the active judicial officer and engaged in escorting the officer.
Text of subsection as added by Acts 2007, 80th Leg., R.S., Ch. 1222 (H.B. 2300), Sec. 5
(h-1) It is a defense to prosecution under Subsections (b)(1), (2), and (4)-(6), and (c) that at the time of the commission of the offense, the actor was:
(1) a judge or justice of a federal court;
(2) an active judicial officer, as defined by Section 411.201, Government Code; or
(3) a district attorney, assistant district attorney, criminal district attorney, assistant criminal district attorney, county attorney, or assistant county attorney.
(i) Subsections (b)(4), (b)(5), (b)(6), and (c) do not apply if the actor was not given effective notice under Section 30.06.
(j) Subsections (a) and (b)(1) do not apply to a historical reenactment performed in compliance with the rules of the Texas Alcoholic Beverage Commission.
(k) It is a defense to prosecution under Subsection (b)(1) that the actor was not given effective notice under Section 411.204, Government Code.
Added by Acts 1995, 74th Leg., ch. 229, Sec. 4, eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 165, Sec. 10.04, eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch. 1261, Sec. 26, 27, eff. Sept. 1, 1997; Acts 2001, 77th Leg., ch. 1420, Sec. 14.833, eff. Sept. 1, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 976 (H.B. 1813), Sec. 3, eff. September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1214 (H.B. 1889), Sec. 2, eff. June 15, 2007.
Acts 2007, 80th Leg., R.S., Ch. 1222 (H.B. 2300), Sec. 5, eff. June 15, 2007.
Acts 2009, 81st Leg., R.S., Ch. 687 (H.B. 2664), Sec. 1, eff. September 1, 2009.
Acts 2013, 83rd Leg., R.S., Ch. 72 (S.B. 299), Sec. 1, eff. September 1, 2013.
Sec. 46.04. UNLAWFUL POSSESSION OF FIREARM. (a) A person who has been convicted of a felony commits an offense if he possesses a firearm:
(1) after conviction and before the fifth anniversary of the person’s release from confinement following conviction of the felony or the person’s release from supervision under community supervision, parole, or mandatory supervision, whichever date is later; or
(2) after the period described by Subdivision (1), at any location other than the premises at which the person lives.
(b) A person who has been convicted of an offense under Section 22.01, punishable as a Class A misdemeanor and involving a member of the person’s family or household, commits an offense if the person possesses a firearm before the fifth anniversary of the later of:
(1) the date of the person’s release from confinement following conviction of the misdemeanor; or
(2) the date of the person’s release from community supervision following conviction of the misdemeanor.
(c) A person, other than a peace officer, as defined by Section 1.07, actively engaged in employment as a sworn, full-time paid employee of a state agency or political subdivision, who is subject to an order issued under Section 6.504 or Chapter 85, Family Code, under Article 17.292 or Chapter 7A, Code of Criminal Procedure, or by another jurisdiction as provided by Chapter 88, Family Code, commits an offense if the person possesses a firearm after receiving notice of the order and before expiration of the order.
(d) In this section, “family,” “household,” and “member of a household” have the meanings assigned by Chapter 71, Family Code.
(e) An offense under Subsection (a) is a felony of the third degree. An offense under Subsection (b) or (c) is a Class A misdemeanor.
(f) For the purposes of this section, an offense under the laws of this state, another state, or the United States is, except as provided by Subsection (g), a felony if, at the time it is committed, the offense:
(1) is designated by a law of this state as a felony;
(2) contains all the elements of an offense designated by a law of this state as a felony; or
(3) is punishable by confinement for one year or more in a penitentiary.
(g) An offense is not considered a felony for purposes of Subsection (f) if, at the time the person possesses a firearm, the offense:
(1) is not designated by a law of this state as a felony; and
(2) does not contain all the elements of any offense designated by a law of this state as a felony.
Acts 1973, 63rd Leg., p. 883, ch. 399, Sec. 1, eff. Jan. 1, 1974. Renumbered from Penal Code Sec. 46.05 and amended by Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994. Amended by Acts 2001, 77th Leg., ch. 23, Sec. 2, eff. Sept. 1, 2001; Acts 2003, 78th Leg., ch. 836, Sec. 4, eff. Sept. 1, 2003.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1146 (H.B. 2730), Sec. 11.24, eff. September 1, 2009.
Sec. 46.041. UNLAWFUL POSSESSION OF METAL OR BODY ARMOR BY FELON. (a) In this section, “metal or body armor” means any body covering manifestly designed, made, or adapted for the purpose of protecting a person against gunfire.
(b) A person who has been convicted of a felony commits an offense if after the conviction the person possesses metal or body armor.
(c) An offense under this section is a felony of the third degree.
Added by Acts 2001, 77th Leg., ch. 452, Sec. 1, eff. Sept. 1, 2001.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 473, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 46.05. PROHIBITED WEAPONS. (a) A person commits an offense if the person intentionally or knowingly possesses, manufactures, transports, repairs, or sells:
(1) an explosive weapon;
(2) a machine gun;
(3) a short-barrel firearm;
(4) a firearm silencer;
(5) knuckles;
(6) armor-piercing ammunition;
(7) a chemical dispensing device;
(8) a zip gun; or
(9) a tire deflation device.
(b) It is a defense to prosecution under this section that the actor’s conduct was incidental to the performance of official duty by the armed forces or national guard, a governmental law enforcement agency, or a correctional facility.
(c) It is a defense to prosecution under this section that the actor’s possession was pursuant to registration pursuant to the National Firearms Act, as amended.
(d) It is an affirmative defense to prosecution under this section that the actor’s conduct:
(1) was incidental to dealing with a short-barrel firearm or tire deflation device solely as an antique or curio;
(2) was incidental to dealing with armor-piercing ammunition solely for the purpose of making the ammunition available to an organization, agency, or institution listed in Subsection (b); or
(3) was incidental to dealing with a tire deflation device solely for the purpose of making the device available to an organization, agency, or institution listed in Subsection (b).
(e) An offense under Subsection (a)(1), (2), (3), (4), (6), (7), or (8) is a felony of the third degree. An offense under Subsection (a)(9) is a state jail felony. An offense under Subsection (a)(5) is a Class A misdemeanor.
(f) It is a defense to prosecution under this section for the possession of a chemical dispensing device that the actor is a security officer and has received training on the use of the chemical dispensing device by a training program that is:
(1) provided by the Texas Commission on Law Enforcement; or
(2) approved for the purposes described by this subsection by the Texas Private Security Board of the Department of Public Safety.
(g) In Subsection (f), “security officer” means a commissioned security officer as defined by Section 1702.002, Occupations Code, or a noncommissioned security officer registered under Section 1702.221, Occupations Code.
Acts 1973, 63rd Leg., p. 883, ch. 399, Sec. 1, eff. Jan. 1, 1974. Amended by Acts 1975, 64th Leg., p. 918, ch. 342, Sec. 15, eff. Sept. 1, 1975; Acts 1983, 68th Leg., p. 2650, ch. 457, Sec. 2, eff. Sept. 1, 1983; Acts 1983, 68th Leg., p. 4831, ch. 852, Sec. 2, eff. Sept. 1, 1983; Acts 1987, 70th Leg., ch. 167, Sec. 5.01(a)(47), eff. Sept. 1, 1987; Acts 1991, 72nd Leg., ch. 229, Sec. 2, eff. Sept. 1, 1991; Renumbered from Penal Code Sec. 46.06 and amended by Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994; Acts 2003, 78th Leg., ch. 1071, Sec. 1, eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 1035 (H.B. 1132), Sec. 2.01, eff. September 1, 2005.
Acts 2005, 79th Leg., Ch. 1278 (H.B. 2303), Sec. 7, eff. September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 920 (S.B. 1416), Sec. 2, eff. September 1, 2011.
Acts 2013, 83rd Leg., R.S., Ch. 93 (S.B. 686), Sec. 2.60, eff. May 18, 2013.
Acts 2013, 83rd Leg., R.S., Ch. 960 (H.B. 1862), Sec. 1, eff. September 1, 2013.
Sec. 46.06. UNLAWFUL TRANSFER OF CERTAIN WEAPONS. (a) A person commits an offense if the person:
(1) sells, rents, leases, loans, or gives a handgun to any person knowing that the person to whom the handgun is to be delivered intends to use it unlawfully or in the commission of an unlawful act;
(2) intentionally or knowingly sells, rents, leases, or gives or offers to sell, rent, lease, or give to any child younger than 18 years any firearm, club, or illegal knife;
(3) intentionally, knowingly, or recklessly sells a firearm or ammunition for a firearm to any person who is intoxicated;
(4) knowingly sells a firearm or ammunition for a firearm to any person who has been convicted of a felony before the fifth anniversary of the later of the following dates:
(A) the person’s release from confinement following conviction of the felony; or
(B) the person’s release from supervision under community supervision, parole, or mandatory supervision following conviction of the felony;
(5) sells, rents, leases, loans, or gives a handgun to any person knowing that an active protective order is directed to the person to whom the handgun is to be delivered; or
(6) knowingly purchases, rents, leases, or receives as a loan or gift from another a handgun while an active protective order is directed to the actor.
(b) In this section:
(1) “Intoxicated” means substantial impairment of mental or physical capacity resulting from introduction of any substance into the body.
(2) “Active protective order” means a protective order issued under Title 4, Family Code, that is in effect. The term does not include a temporary protective order issued before the court holds a hearing on the matter.
(c) It is an affirmative defense to prosecution under Subsection (a)(2) that the transfer was to a minor whose parent or the person having legal custody of the minor had given written permission for the sale or, if the transfer was other than a sale, the parent or person having legal custody had given effective consent.
(d) An offense under this section is a Class A misdemeanor, except that an offense under Subsection (a)(2) is a state jail felony if the weapon that is the subject of the offense is a handgun.
Acts 1973, 63rd Leg., p. 883, ch. 399, Sec. 1, eff. Jan. 1, 1974. Amended by Acts 1985, 69th Leg., ch. 686, Sec. 1, eff. Sept. 1, 1985. Renumbered from Penal Code Sec. 46.07 and amended by Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994. Amended by Acts 1995, 74th Leg., ch. 324, Sec. 1, eff. Jan. 1, 1996; Acts 1997, 75th Leg., ch. 1193, Sec. 22, eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch. 1304, Sec. 1, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 62, Sec. 15.02(f), eff. Sept. 1, 1999.
Sec. 46.07. INTERSTATE PURCHASE. A resident of this state may, if not otherwise precluded by law, purchase firearms, ammunition, reloading components, or firearm accessories in another state. This authorization is enacted in conformance with 18 U.S.C. Section 922(b)(3)(A).
Acts 1973, 63rd Leg., p. 883, ch. 399, Sec. 1, eff. Jan. 1, 1974. Renumbered from Penal Code Sec. 46.08 by Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 280 (S.B. 1188), Sec. 1, eff. May 30, 2009.
Sec. 46.08. HOAX BOMBS. (a) A person commits an offense if the person knowingly manufactures, sells, purchases, transports, or possesses a hoax bomb with intent to use the hoax bomb to:
(1) make another believe that the hoax bomb is an explosive or incendiary device; or
(2) cause alarm or reaction of any type by an official of a public safety agency or volunteer agency organized to deal with emergencies.
(b) An offense under this section is a Class A misdemeanor.
Added by Acts 1983, 68th Leg., p. 4831, ch. 852, Sec. 3, eff. Sept. 1, 1983. Renumbered from Penal Code Sec. 46.09 by Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994.
Sec. 46.09. COMPONENTS OF EXPLOSIVES. (a) A person commits an offense if the person knowingly possesses components of an explosive weapon with the intent to combine the components into an explosive weapon for use in a criminal endeavor.
(b) An offense under this section is a felony of the third degree.
Added by Acts 1983, 68th Leg., p. 4832, ch. 852, Sec. 4, eff. Sept. 1, 1983. Renumbered from Penal Code Sec. 46.10 by Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994.
Sec. 46.10. DEADLY WEAPON IN PENAL INSTITUTION. (a) A person commits an offense if, while confined in a penal institution, he intentionally, knowingly, or recklessly:
(1) carries on or about his person a deadly weapon; or
(2) possesses or conceals a deadly weapon in the penal institution.
(b) It is an affirmative defense to prosecution under this section that at the time of the offense the actor was engaged in conduct authorized by an employee of the penal institution.
(c) A person who is subject to prosecution under both this section and another section under this chapter may be prosecuted under either section.
(d) An offense under this section is a felony of the third degree.
Added by Acts 1985, 69th Leg., ch. 46, Sec. 1, eff. Sept. 1, 1985. Amended by Acts 1987, 70th Leg., ch. 714, Sec. 1, eff. Sept. 1, 1987. Renumbered from Penal Code Sec. 46.11 by Acts 1993, 73rd Leg., ch. 900, Sec. 1.01, eff. Sept. 1, 1994.
Sec. 46.11. PENALTY IF OFFENSE COMMITTED WITHIN WEAPON-FREE SCHOOL ZONE. (a) Except as provided by Subsection (b), the punishment prescribed for an offense under this chapter is increased to the punishment prescribed for the next highest category of offense if it is shown beyond a reasonable doubt on the trial of the offense that the actor committed the offense in a place that the actor knew was:
(1) within 300 feet of the premises of a school; or
(2) on premises where:
(A) an official school function is taking place; or
(B) an event sponsored or sanctioned by the University Interscholastic League is taking place.
(b) This section does not apply to an offense under Section 46.03(a)(1).
(c) In this section:
(1) “Premises” has the meaning assigned by Section 481.134, Health and Safety Code.
(2) “School” means a private or public elementary or secondary school.
Added by Acts 1995, 74th Leg., ch. 320, Sec. 1, eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1063, Sec. 10, eff. Sept. 1, 1997.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 91 (S.B. 1303), Sec. 20.002, eff. September 1, 2011.
Sec. 46.12. MAPS AS EVIDENCE OF LOCATION OR AREA. (a) In a prosecution of an offense for which punishment is increased under Section 46.11, a map produced or reproduced by a municipal or county engineer for the purpose of showing the location and boundaries of weapon-free zones is admissible in evidence and is prima facie evidence of the location or boundaries of those areas if the governing body of the municipality or county adopts a resolution or ordinance approving the map as an official finding and record of the location or boundaries of those areas.
(b) A municipal or county engineer may, on request of the governing body of the municipality or county, revise a map that has been approved by the governing body of the municipality or county as provided by Subsection (a).
(c) A municipal or county engineer shall file the original or a copy of every approved or revised map approved as provided by Subsection (a) with the county clerk of each county in which the area is located.
(d) This section does not prevent the prosecution from:
(1) introducing or relying on any other evidence or testimony to establish any element of an offense for which punishment is increased under Section 46.11; or
(2) using or introducing any other map or diagram otherwise admissible under the Texas Rules of Evidence.
Added by Acts 1995, 74th Leg., ch. 320, Sec. 2, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 728 (H.B. 2018), Sec. 16.004, eff. September 1, 2005.
Sec. 46.13. MAKING A FIREARM ACCESSIBLE TO A CHILD. (a) In this section:
(1) “Child” means a person younger than 17 years of age.
(2) “Readily dischargeable firearm” means a firearm that is loaded with ammunition, whether or not a round is in the chamber.
(3) “Secure” means to take steps that a reasonable person would take to prevent the access to a readily dischargeable firearm by a child, including but not limited to placing a firearm in a locked container or temporarily rendering the firearm inoperable by a trigger lock or other means.
(b) A person commits an offense if a child gains access to a readily dischargeable firearm and the person with criminal negligence:
(1) failed to secure the firearm; or
(2) left the firearm in a place to which the person knew or should have known the child would gain access.
(c) It is an affirmative defense to prosecution under this section that the child’s access to the firearm:
(1) was supervised by a person older than 18 years of age and was for hunting, sporting, or other lawful purposes;
(2) consisted of lawful defense by the child of people or property;
(3) was gained by entering property in violation of this code; or
(4) occurred during a time when the actor was engaged in an agricultural enterprise.
(d) Except as provided by Subsection (e), an offense under this section is a Class C misdemeanor.
(e) An offense under this section is a Class A misdemeanor if the child discharges the firearm and causes death or serious bodily injury to himself or another person.
(f) A peace officer or other person may not arrest the actor before the seventh day after the date on which the offense is committed if:
(1) the actor is a member of the family, as defined by Section 71.003, Family Code, of the child who discharged the firearm; and
(2) the child in discharging the firearm caused the death of or serious injury to the child.
(g) A dealer of firearms shall post in a conspicuous position on the premises where the dealer conducts business a sign that contains the following warning in block letters not less than one inch in height:
“IT IS UNLAWFUL TO STORE, TRANSPORT, OR ABANDON AN UNSECURED FIREARM IN A PLACE WHERE CHILDREN ARE LIKELY TO BE AND CAN OBTAIN ACCESS TO THE FIREARM.”
Added by Acts 1995, 74th Leg., ch. 83, Sec. 1, eff. Sept. 1, 1995. Amended by Acts 1999, 76th Leg., ch. 62, Sec. 15.02(g), eff. Sept. 1, 1999.
Sec. 46.14. FIREARM SMUGGLING. (a) A person commits an offense if the person knowingly engages in the business of transporting or transferring a firearm that the person knows was acquired in violation of the laws of any state or of the United States. For purposes of this subsection, a person is considered to engage in the business of transporting or transferring a firearm if the person engages in that conduct:
(1) on more than one occasion; or
(2) for profit or any other form of remuneration.
(b) An offense under this section is a felony of the third degree, unless it is shown on the trial of the offense that the offense was committed with respect to three or more firearms in a single criminal episode, in which event the offense is a felony of the second degree.
(c) This section does not apply to a peace officer who is engaged in the actual discharge of an official duty.
(d) If conduct that constitutes an offense under this section also constitutes an offense under any other law, the actor may be prosecuted under this section, the other law, or both.
Added by Acts 2009, 81st Leg., R.S., Ch. 153 (S.B. 2225), Sec. 1, eff. September 1, 2009.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see H.B. 910, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 46.15. NONAPPLICABILITY.
(a) Sections 46.02 and 46.03 do not apply to:
(1) peace officers or special investigators under Article 2.122, Code of Criminal Procedure, and neither section prohibits a peace officer or special investigator from carrying a weapon in this state, including in an establishment in this state serving the public, regardless of whether the peace officer or special investigator is engaged in the actual discharge of the officer’s or investigator’s duties while carrying the weapon;
(2) parole officers and neither section prohibits an officer from carrying a weapon in this state if the officer is:
(A) engaged in the actual discharge of the officer’s duties while carrying the weapon; and
(B) in compliance with policies and procedures adopted by the Texas Department of Criminal Justice regarding the possession of a weapon by an officer while on duty;
(3) community supervision and corrections department officers appointed or employed under Section 76.004, Government Code, and neither section prohibits an officer from carrying a weapon in this state if the officer is:
(A) engaged in the actual discharge of the officer’s duties while carrying the weapon; and
(B) authorized to carry a weapon under Section 76.0051, Government Code;
(4) an active judicial officer as defined by Section 411.201, Government Code, who is licensed to carry a concealed handgun under Subchapter H, Chapter 411, Government Code;
(5) an honorably retired peace officer, qualified retired law enforcement officer, federal criminal investigator, or former reserve law enforcement officer who holds a certificate of proficiency issued under Section 1701.357, Occupations Code, and is carrying a photo identification that is issued by a federal, state, or local law enforcement agency, as applicable, and that verifies that the officer is:
(A) an honorably retired peace officer;
(B) a qualified retired law enforcement officer;
(C) a federal criminal investigator; or
(D) a former reserve law enforcement officer who has served in that capacity not less than a total of 15 years with one or more state or local law enforcement agencies;
(6) a district attorney, criminal district attorney, county attorney, or municipal attorney who is licensed to carry a concealed handgun under Subchapter H, Chapter 411, Government Code;
(7) an assistant district attorney, assistant criminal district attorney, or assistant county attorney who is licensed to carry a concealed handgun under Subchapter H, Chapter 411, Government Code;
(8) a bailiff designated by an active judicial officer as defined by Section 411.201, Government Code, who is:
(A) licensed to carry a concealed handgun under Chapter 411, Government Code; and
(B) engaged in escorting the judicial officer; or
(9) a juvenile probation officer who is authorized to carry a firearm under Section 142.006, Human Resources Code.
(b) Section 46.02 does not apply to a person who:
(1) is in the actual discharge of official duties as a member of the armed forces or state military forces as defined by Section 437.001, Government Code, or as a guard employed by a penal institution;
(2) is traveling;
(3) is engaging in lawful hunting, fishing, or other sporting activity on the immediate premises where the activity is conducted, or is en route between the premises and the actor’s residence, motor vehicle, or watercraft, if the weapon is a type commonly used in the activity;
(4) holds a security officer commission issued by the Texas Private Security Board, if the person is engaged in the performance of the person’s duties as an officer commissioned under Chapter 1702, Occupations Code, or is traveling to or from the person’s place of assignment and is wearing the officer’s uniform and carrying the officer’s weapon in plain view;
(5) acts as a personal protection officer and carries the person’s security officer commission and personal protection officer authorization, if the person:
(A) is engaged in the performance of the person’s duties as a personal protection officer under Chapter 1702, Occupations Code, or is traveling to or from the person’s place of assignment; and
(B) is either:
(i) wearing the uniform of a security officer, including any uniform or apparel described by Section 1702.323(d), Occupations Code, and carrying the officer’s weapon in plain view; or
(ii) not wearing the uniform of a security officer and carrying the officer’s weapon in a concealed manner;
(6) is carrying a concealed handgun and a valid license issued under Subchapter H, Chapter 411, Government Code, to carry a concealed handgun;
(7) holds an alcoholic beverage permit or license or is an employee of a holder of an alcoholic beverage permit or license if the person is supervising the operation of the permitted or licensed premises; or
(8) is a student in a law enforcement class engaging in an activity required as part of the class, if the weapon is a type commonly used in the activity and the person is:
(A) on the immediate premises where the activity is conducted; or
(B) en route between those premises and the person’s residence and is carrying the weapon unloaded.
(c) The provision of Section 46.02 prohibiting the carrying of a club does not apply to a noncommissioned security guard at an institution of higher education who carries a nightstick or similar club, and who has undergone 15 hours of training in the proper use of the club, including at least seven hours of training in the use of the club for nonviolent restraint. For the purposes of this subsection, “nonviolent restraint” means the use of reasonable force, not intended and not likely to inflict bodily injury.
(d) The provisions of Section 46.02 prohibiting the carrying of a firearm or carrying of a club do not apply to a public security officer employed by the adjutant general under Section 437.053, Government Code, in performance of official duties or while traveling to or from a place of duty.
(e) The provisions of Section 46.02 prohibiting the carrying of an illegal knife do not apply to an individual carrying a bowie knife or a sword used in a historical demonstration or in a ceremony in which the knife or sword is significant to the performance of the ceremony.
(f) Section 46.03(a)(6) does not apply to a person who possesses a firearm or club while in the actual discharge of official duties as:
(1) a member of the armed forces or state military forces, as defined by Section 437.001, Government Code; or
(2) an employee of a penal institution.
(g) The provisions of Sections 46.02 and 46.03 prohibiting the possession or carrying of a club do not apply to an animal control officer who holds a certificate issued under Section 829.006, Health and Safety Code, and who possesses or carries an instrument used specifically for deterring the bite of an animal while the officer is in the performance of official duties under the Health and Safety Code or is traveling to or from a place of duty.
(h) Repealed by Acts 2007, 80th Leg., R.S., Ch. 693, Sec. 3(1), eff. September 1, 2007.
(i) Repealed by Acts 2007, 80th Leg., R.S., Ch. 693, Sec. 3(2), eff. September 1, 2007.
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Vernon’s Texas Statutes and Codes Annotated Transportation Code
Texas Seatbelt Laws
TRANSPORTATION CODE Chapter 545. Operation and Movement of Vehicles § 545.412. Child Passenger Safety Seat Systems; Offense.
(a) A person commits an offense if the person operates a passenger vehicle, transports a child who is younger than eight years of age, unless the child is taller than four feet, nine inches, and does not keep the child secured during the operation of the vehicle in a child passenger safety seat system according to the instructions of the manufacturer of the safety seat system.
(b) An offense under this section is a misdemeanor punishable by a fine of not less than $25 and not more than $250.
(b-1) [Repealed by Acts 2011, 82nd Leg., 1st C.S., ch. 4 (S.B. 1), § 69.01(1), effective September 28, 2011.]
(c) It is a defense to prosecution under this section that the person was operating the vehicle in an emergency or for a law enforcement purpose.
(d) [Repealed by Acts 2003, 78th Leg., ch. 204 (H.B. 4), § 8.01, effective September 1, 2003.]
(e) This section does not apply to a person:
(1) operating a vehicle transporting passengers for hire, excluding third-party transport service providers when transporting clients pursuant to a contract to provide nonemergency Medicaid transportation; or
(2) transporting a child in a vehicle in which all seating positions equipped with child passenger safety seat systems or safety belts are occupied.
(f) In this section:
(1) “Child passenger safety seat system” means an infant or child passenger restraint system that meets the federal standards for crash-tested restraint systems as set by the National Highway Traffic Safety Administration.
(2) “Passenger vehicle” means a passenger car, light truck, sport utility vehicle, passenger van designed to transport 15 or fewer passengers, including the driver, truck, or truck tractor.
(3) “Safety belt” means a lap belt and any shoulder straps included as original equipment on or added to a vehicle.
(4) “Secured,” in connection with use of a safety belt, means using the lap belt and any shoulder straps according to the instructions of:
(A) the manufacturer of the vehicle, if the safety belt is original equipment; or
(B) the manufacturer of the safety belt, if the safety belt has been added to the vehicle.
(g) A judge, acting under Article 45.0511, Code of Criminal Procedure, who elects to defer further proceedings and to place a defendant accused of a violation of this section on probation under that article, in lieu of requiring the defendant to complete a driving safety course approved by the Texas Education Agency, shall require the defendant to attend and present proof that the defendant has successfully completed a specialized driving safety course approved by the Texas Education Agency under the Texas Driver and Traffic Safety Education Act (Article 4413(29c), Vernon’s Texas Civil Statutes) that includes four hours of instruction that encourages the use of child passenger safety seat systems and the wearing of seat belts and emphasizes:
(1) the effectiveness of child passenger safety seat systems and seat belts in reducing the harm to children being transported in motor vehicles; and
(2) the requirements of this section and the penalty for noncompliance.
(h) Notwithstanding Section 542.402(a), a municipality or county, at the end of the municipality’s or county’s fiscal year, shall send to the comptroller an amount equal to 50 percent of the fines collected by the municipality or the county for violations of this section. The comptroller shall deposit the amount received to the credit of the tertiary care fund for use by trauma centers.
Chapter 545. Operation and Movement of Vehicles § 545.4121. Dismissal; Obtaining Child Passenger Safety Seat System.
(a) This section applies to an offense committed under Section 545.412.
(b) It is a defense to prosecution of an offense to which this section applies that the defendant provides to the court evidence satisfactory to the court that:
(1) at the time of the offense:
(A) the defendant was not arrested or issued a citation for violation of any other offense;
(B) the defendant did not possess a child passenger safety seat system in the vehicle; and
(C) the vehicle the defendant was operating was not involved in an accident; and
(2) subsequent to the time of the offense, the defendant obtained an appropriate child passenger safety seat system for each child required to be secured in a child passenger safety seat system under Section 545.412(a).
Chapter 545. Operation and Movement of Vehicles § 545.413. Safety Belts; Offense.
(a) A person commits an offense if:
(1) the person:
(A) is at least 15 years of age;
(B) is riding in a passenger vehicle while the vehicle is being operated;
(C) is occupying a seat that is equipped with a safety belt; and
(D) is not secured by a safety belt; or
(2) as the operator of a school bus equipped with a safety belt for the operator’s seat, the person is not secured by the safety belt.
(b) A person commits an offense if the person:
(1) operates a passenger vehicle that is equipped with safety belts; and
(2) allows a child who is younger than 17 years of age and who is not required to be secured in a child passenger safety seat system under Section 545.412(a) to ride in the vehicle without requiring the child to be secured by a safety belt, provided the child is occupying a seat that is equipped with a safety belt.
(b-1) A person commits an offense if the person allows a child who is younger than 17 years of age and who is not required to be secured in a child passenger safety seat system under Section 545.412(a) to ride in a passenger van designed to transport 15 or fewer passengers, including the driver, without securing the child individually by a safety belt, if the child is occupying a seat that is equipped with a safety belt.
(c) A passenger vehicle or a seat in a passenger vehicle is considered to be equipped with a safety belt if the vehicle is required under Section 547.601 to be equipped with safety belts.
(d) An offense under Subsection (a) is a misdemeanor punishable by a fine of not less than $25 or more than $50. An offense under Subsection (b) is a misdemeanor punishable by a fine of not less than $100 or more than $200.
(e) It is a defense to prosecution under this section that:
(1) the person possesses a written statement from a licensed physician stating that for a medical reason the person should not wear a safety belt;
(2) the person presents to the court, not later than the 10th day after the date of the offense, a statement from a licensed physician stating that for a medical reason the person should not wear a safety belt;
(3) the person is employed by the United States Postal Service and performing a duty for that agency that requires the operator to service postal boxes from a vehicle or that requires frequent entry into and exit from a vehicle;
(4) the person is engaged in the actual delivery of newspapers from a vehicle or is performing newspaper delivery duties that require frequent entry into and exit from a vehicle;
(5) the person is employed by a public or private utility company and is engaged in the reading of meters or performing a similar duty for that company requiring the operator to frequently enter into and exit from a vehicle;
(6) the person is operating a commercial vehicle registered as a farm vehicle under the provisions of Section 502.433 that does not have a gross weight, registered weight, or gross weight rating of 48,000 pounds or more; or
(7) the person is the operator of or a passenger in a vehicle used exclusively to transport solid waste and performing duties that require frequent entry into and exit from the vehicle.
(f) The department shall develop and implement an educational program to encourage the wearing of safety belts and to emphasize:
(1) the effectiveness of safety belts and other restraint devices in reducing the risk of harm to passengers in motor vehicles; and
(2) the requirements of this section and the penalty for noncompliance.
Chapter 545. Operation and Movement of Vehicles § 545.414. Riding in Open Beds; Offense.
(a) A person commits an offense if the person operates an open-bed pickup truck or an open flatbed truck or draws an open flatbed trailer when a child younger than 18 years of age is occupying the bed of the truck or trailer.
(b) An offense under this section is a misdemeanor punishable by a fine of not less than $25 or more than $200.
(c) It is a defense to prosecution under this section that the person was:
(1) operating or towing the vehicle in a parade or in an emergency;
(2) operating the vehicle to transport farmworkers from one field to another field on a farm-to-market road, ranch-to-market road, or county road outside a municipality;
(3) operating the vehicle on a beach;
(4) operating a vehicle that is the only vehicle owned or operated by the members of a household; or
(5) operating the vehicle in a hayride permitted by the governing body of or a law enforcement agency of each county or municipality in which the hayride will occur.
(d) Compliance or noncompliance with Subsection (a) is not admissible evidence in a civil trial.
(e) In this section, “household” has the meaning assigned by Section 71.005, Family Code.
Texas law now requires drivers and all passengers in vehicles to be secured by a safety belt. A safety belt violation can result in fines ranging from $25 to $250, plus court costs.
Safety Seat Guidelines
Safety belts are designed for adults, not children.
Follow these guidelines when buying the proper seat and buckling up children:
Birth-2 Years
All infants and toddlers should ride in a rear-facing car seat until they are at least 2 years of age or until they reach the highest weight or height allowed by their car seat’s manufacturer. (Check labels on seat for this information.)
Secure the chest clip even with your baby’s armpits.
Fasten harness straps snugly against your baby’s body. You should not be able to pinch the slack at the baby’s shoulder.
Use the harness slot at or below the baby’s shoulder for rear-facing.
Over 2 Years
Use a forward-facing seat for as long as the safety seat manufacturer recommends it. (Check labels for maximum height and weight information.)
Fasten harness straps snugly against your child’s body. You should not be able to pinch the slack at the baby’s shoulder.
Secure the chest clip even with your child’s armpits.
Use either seat belt or lower anchors to secure the car seat, not both. Always latch the tether strap to the corresponding anchor if your vehicle has one.
4-8 Years
Use a booster seat to the maximum height or weight limit. (Check labels for information.)
Fasten the lap belt across your child’s thighs and hips, not stomach.
The shoulder belt should rest on the chest, not the neck. Check belt routing on booster for proper placement.
Over 8 Years Old
Always use a lap and shoulder belt for maximum protection.
Anyone under the age of 13 should be restrained in the back seat.
Williams, McClure & Parmelee is dedicated to high quality legal representation of businesses and insurance companies in a variety of matters. We are experienced Texas civil litigation attorneys based in Fort Worth who know Texas courts and Texas law. For more information, please contact the law firm at 817-335-8800. The firm’s new office location is 5601 Bridge Street, Suite 300, Fort Worth, Texas 76112.
In a Texas premises-liability case, a landowner is liable to employees of an independent contractor only for claims arising from a concealed, pre-existing defect rather than from the contractor’s work. Gen. Elec. Co. v. Moritz, 257 S.W.3d 211, 215 (Tex. 2008). “With respect to existing defects, an owner or occupier has a duty to inspect the premises and warn of concealed hazards the owner knows or should have known about.” Id. (quoting Shell Oil Co. v. Khan, 138 S.W.3d 288, 295 (Tex. 2004)).
“Premises Liability” refers to accidents that occur due to the negligent maintenance, operation or design of a property owned by someone other than the accident victim. This includes claims against a landlord on behalf of a tenant or against the landowner for injuries suffered by an individual who was lawfully on the property.
The Texas Legislature has waived sovereign immunity for personal injury claims arising from a premise defect. Tex. Civ. Prac. & Rem. Code § 101.021. Former section 101.022 of the Texas Civil Practices and Remedies Code[2] applied different duties of care to a suit depending on whether the condition was a premise defect or a special defect:
(a) If a claim arises from a premise defect, the governmental unit owes to the claimant only the duty that a private person owes
to a licensee on private property, unless the claimant pays for the use of the premises.
(b) The limitation of duty in this section does not apply to the duty to warn of special defects such as excavations or obstructions
on highways, roads, or streets or to the duty to warn of the absence, condition, or malfunction of traffic signs, signals, or warning
devices as is required by Section 101.060.
Act of May 17, 1985, 69th Leg., R.S., ch. 959, 1985 Tex. Gen. Laws 3242, 3303 (amended 2005) (current version at Tex. Civ.Prac. & Rem. Code § 101.022) (hereinafter § 101.022). If a claim involves a premise defect under section (a), a licensee standard applies. Tex. Civ Prac. & Rem. Code § 101.022(a); see also State Dep’t of Highways & Public Transp. v. Payne, 838 S.W.2d 235, 237 (Tex. 1992). Under a licensee standard, a plaintiff must prove the governmental unit had actual knowledge of a condition that created an unreasonable risk of harm, and also that the licensee did not have actual knowledge of that same
condition. Payne, 838 S.W.2d at 237. But if a claim involves a special defect under section (b), a more lenient invitee standard applies. Tex. Civ. Prac. & Rem. Code § 101.022(b). Under an invitee standard, the plaintiff need only prove that the governmental unit should have known of a condition that created an unreasonable risk of harm. Payne, 838 S.W.2d at 237; see also State Dep’t of Highways & Pub. Transp. v. Kitchen, 867 S.W.2d 784, 786 (Tex. 1993) (per curiam) (“Absent a finding that the State knew of the dangerous condition prior to the accident, it is not liable to plaintiffs unless the condition was a special
defect.”). Whether a condition is a premise defect or special defect is a question of law, which we review de novo. Payne, 838 S.W.2d at 238.
The Civil Practices and Remedies Code does not define exactly what a“special defect” is,but does give guidance by likening special defects to
“excavations or obstructions.” See Tex. Civ. Prac. & Rem. Code § 101.022(b)
The term “Premises Liability” encompasses a wide range of events that cause injury and may give rise to liability. For example, a slip and fall due to a wet or defective floor may be actionable against a landowner or a landlord. Other examples include claims for inadequate security, lighting or the failure to properly maintain railings, porches or stairs. These are examples of premises liability actions. Each set of facts giving rise to an injury on a premises must be individually evaluated.
In Texas, a premises owner does not guarantee the safety of its customers or employees. Consequently, an employee is not automatically entitled to
recover for his injuries merely because the injury occurred on his employer’s property.
To prevail on a premises-liability claim, a Plainiff must prove four essential elements:
(1) Actual or constructive knowledge of a condition on the premises by the
owner or occupier;
(2) That the condition posed an unreasonable risk of harm;
(3) That the owner or occupier did not exercise reasonable care to reduce or eliminate the risk; and
(4) That the owner or occupier’s failure to use such care proximately caused the plaintiff’s injury.
These four elements are typically referred to as: (1) notice; (2) unreasonably dangerous condition; (3) failure to exercise ordinary care; and (4) proximate cause.
As always, it is important to contact a knowledgeable and experienced Texas insurance defense attorney to help you understand your rights as a Defendant in a premises liability case. James L. Williams of Williams, McClure & Parmelee in Fort Worth, Texas is a veteran insurance defense attorney who protects the rights of insurance carriers and businesses in Texas premises liability cases.
Williams, McClure & Parmelee is dedicated to high quality legal representation of businesses and insurance companies in a variety of matters. We are experienced Texas civil litigation attorneys based in Fort Worth who know Texas courts and Texas law. For more information, please contact the law firm at 817-335-8800. The firm’s office location is 5601 Bridge Street, Suite 300, Fort Worth, Texas 76112.
Workers’ compensation is a state-regulated insurance system that ensures medical bills and some lost wages are paid for employees injured on the job. Texas does not require most private employers to have workers’ compensation insurance coverage. Employers not providing workers’ compensation insurance coverage are referred to as non-subscribers.
Non-subscribers lose important legal protections, including immunity from most lawsuits by injured employees. They could also be forced to pay high damage awards if an injured employee can prove in court that the employer was negligent in any way.
If an employer has workers’ compensation insurance coverage, Texas law limits the employer’s liability for work-related injuries. Injured employees may get medical and income benefits set by state law, but generally may not sue their employers.
Texas law requires all employers, with or without workers’ compensation insurance coverage, to comply with reporting and notification requirements under the Texas Workers’ Compensation Act.
When an employer purchases a workers’ compensation policy or is certified to self-insure, the insurance company (or a third-party administrator in the case of self-insurance) pays medical and income benefits. Employers who choose to provide workers’ compensation insurance coverage must do so in one of the following ways:
buy a workers’ compensation insurance policy from an insurance company licensed by the Texas Department of Insurance (TDI);
be certified by the DWC to self-insure workers’ compensation claims;
join a self-insurance group that has received a certificate of approval from TDI; or
be a self-insured governmental entity.
Liability Limits for Workers’ Compensation Subscribers
For employers that provide workers’ compensation insurance coverage, Texas law limits the employer’s liability for work-related injuries of employees. Non-subscribers are not given these legal protections. This means that if an injured employee files suit and is able to prove that the injury was due to the employer’s negligence, the non-subscriber could be subject to high damage awards, including punitive damages and damages for pain and suffering. The employer might also be required to pay defense-related legal expenses, such as attorneys’ fees.
Non-subscribers also lose certain common-law defenses, including:
the injured employee’s negligence caused the injury;
the negligence of fellow employees caused the injury; or
the injured employee knew of the danger and voluntarily accepted it.
Employee Benefits
Employees covered by workers’ compensation insurance coverage receive benefits based on the type and severity of their injuries. Benefits can include:
medical benefits for medically necessary treatment of work-related injuries and illnesses;
disability income benefits for a specified period of time up to a certain dollar limit set by law;
compensation for burial expenses for employees killed on the job;
death benefits for dependents of employees killed on the job.
If there is a workers’ compensation claim for benefits, an employee’s family may be entitled to additional benefits if the employee is killed and the death was caused by the employer’s gross negligence or intentional act or omission.
Alternative Coverages are Not Substitutes for Workers’ Compensation Insurance Coverage
Some employers buy accident and health insurance policies or disability policies or create employer indemnification agreements as less costly alternatives to workers’ compensation insurance coverage. Even though these policies may provide benefits to an injured employee, Texas law does not recognize them as substitutes for workers’ compensation insurance coverage. TDI rules prohibit insurance companies from representing that alternative coverages are substitutes for workers’ compensation insurance coverage.
Unlike workers’ compensation insurance coverage, alternative coverages typically have specific policy limits on medical benefits for each covered employee. In addition, alternative coverages usually have shorter maximum payment periods than those provided by Texas workers’ compensation laws.
Employers that buy alternative coverages do not have workers’ compensation liability protections. They may be sued by their injured employees and lose their right to use key common-law defenses in the suit. Moreover, many alternative coverages do not provide coverage for judgments for pain and suffering, punitive damages, and attorneys’ fees.
A company must be licensed to provide workers’ compensation insurance. Texas law does not recognize insurance policies sold by unlicensed companies, including those legally selling surplus lines insurance. Surplus lines insurance provides coverage for unusual risks that most licensed companies are unwilling to insure. Companies and agents that sell this kind of insurance must be licensed in their home state or country and authorized to sell surplus lines insurance in Texas.
Employers purchasing workers’ compensation insurance from unlicensed companies do not have the liability protections provided to employers purchasing policies from licensed companies. They may be sued by their injured employees and lose their right to use key common-law defenses in the suit. Moreover, unlicensed companies do not provide coverage for judgments for pain and suffering, punitive damages, and attorneys’ fees.
The Texas Property and Casualty Insurance Guaranty Association, which pays policyholder claims against licensed insurance companies that become insolvent, does not cover unlicensed companies. Claims against unlicensed companies will likely go unpaid if the company becomes insolvent. To find out if a company is licensed, call TDI’s Consumer Help Line at 1-800-252-3439 or 512-676-6282 in Austin between 8 a.m. and 5 p.m., or by viewing company profiles on our website at http://www.tdi.texas.gov.
Coverage Comparison
Workers´ Compensation
“Alternative” Policy (Employee Retirement Income Security Act (ERISA) Plan)
Unauthorized Insurance Policy/Surplus Lines
No Coverage
What determines benefit levels?
Texas law
Court/Alternate dispute resolution
Court/Alternate dispute resolution
Court
Who pays medical and lost-income benefits?
Insurance company
Insurance company up to policy limits; employer pays rest
Depends on the policy
Employer
Who pays employer’s legal fees?
Insurance company
Governed by the policy terms
Governed by the policy terms
Employer
Are benefits protected by a guaranty association?
Yes
Limited
No
No
Can an injured employee win judgments for pain and suffering and punitive damages?
No, except in certain circumstances
Yes, up to certain limits
Yes, up to certain limits
Yes, up to certain limits
Note: Policy terms in unlicensed policies may be unenforceable.
For More Information or Assistance
For answers to general insurance questions, for information about filing an insurance-related complaint, or to report suspected insurance fraud, call the Consumer Help Line at 1-800-252-3439 or 512-676-6282 in Austin between 8 a.m. and 5 p.m., Central time, Monday through Friday, or visit our website athttp://www.tdi.texas.gov.
This publication is a summary and is presented for information purposes only. It is not a substitute for current Texas laws or DWC rules. For current information, view our website or call Customer Assistance at 1-800-252-7031. This publication is not an endorsement by DWC of any service, product, or company.
See https://www.tdi.state.tx.us/wc/employer/cb007.html
As always, it is important to contact a knowledgeable and experienced Texas non subscriber law defense attorney to help you understand your rights as an Employer. James L. Williams of Williams, McClure & Parmelee in Fort Worth, Texas is a veteran employment law and workers’ compensation defense attorney who protects the rights of businesses in Texas employment law and non subscriber cases.
Williams, McClure & Parmelee is dedicated to high quality legal representation of businesses and insurance companies in a variety of matters. We are experienced Texas civil litigation attorneys based in Fort Worth who know Texas courts and Texas law. For more information, please contact the law firm at 817-335-8800. The firm’s office location is 5601 Bridge Street, Suite 300, Fort Worth, Texas 76112.
The Texas statutes prevent a hospital lien from attaching to the following:
Claims under the Texas Workers’ Compensation Act, the Federal Employees Liability Act; the Federal Longshoremens’ of Harbor Worker’s Compensation Act, and claims against railroad companies who own the hospital in which the injured person is treated, § 55.003(b);
Claims against the injured worker’s own insurance policy proceeds, such as uninsured/underinsured motorists’ coverage and PIP. §55.003; Members Mutual Insurance Co. v. Hermann Hospital, 664 S.W.2d 325, 28 (Tex. 1984) (uninsured/underinsured motorists benefits are not subject to statutory hospital lien);
Hospital liens do not attach to proceeds from wrongful death actions, but they do attach to survival actions. They attach only in cases where recovery for personal injury is sought; they do not attach to judgments or awards for wrongful death;
Hospital liens do not attach to the expenses of treatment of medical problems that are unrelated to the accident at issue but which are attributed to the negligence of another person;
A hospital may not recover pre-judgment interest on the amount of its hospital lien, and, where it intervenes in a suit in order to recover its lien, it may not recover attorneys’ fees, either. Hermann Hospital v. Vardeman, 775 S.W.2d 866, 867-868 (Tex. App. – Houston [1st Dist.] 1989, no writ).
The text of the relevant statutory language is below:
Texas Property Code CHAPTER 55. HOSPITAL AND EMERGENCY MEDICAL SERVICES LIENS
PROPERTY CODE
CHAPTER 55. HOSPITAL AND EMERGENCY MEDICAL SERVICES LIENS
§ 55.001. DEFINITIONS. In this chapter:
(1) “Emergency medical services” has the meaning
assigned by Section 773.003, Health and Safety Code.
(2) “Emergency medical services provider” has the
meaning assigned by Section 773.003, Health and Safety Code.
(3) “Hospital” means a person or institution
maintaining a facility that provides hospital services in this
state.
(4) “Person” does not include a county, common, or
independent school district.
§ 55.002. LIEN. (a) A hospital has a lien on a cause of
action or claim of an individual who receives hospital services for
injuries caused by an accident that is attributed to the negligence
of another person. For the lien to attach, the individual must be
admitted to a hospital not later than 72 hours after the accident.
(b) The lien extends to both the admitting hospital and a
hospital to which the individual is transferred for treatment of
the same injury.
(c) An emergency medical services provider has a lien on a
cause of action or claim of an individual who receives emergency
medical services in a county with a population of 575,000 or less
for injuries caused by an accident that is attributed to the
negligence of another person. For the lien to attach, the
individual must receive the emergency medical services not later
than 72 hours after the accident.
§ 55.003. PROPERTY TO WHICH LIEN ATTACHES. (a) A lien
under this chapter attaches to:
(1) a cause of action for damages arising from an
injury for which the injured individual is admitted to the hospital
or receives emergency medical services;
(2) a judgment of a court in this state or the decision
of a public agency in a proceeding brought by the injured individual
or by another person entitled to bring the suit in case of the death
of the individual to recover damages arising from an injury for
which the injured individual is admitted to the hospital or
receives emergency medical services; and
(3) the proceeds of a settlement of a cause of action
or a claim by the injured individual or another person entitled to
make the claim, arising from an injury for which the injured
individual is admitted to the hospital or receives emergency
medical services.
(b) The lien does not attach to:
(1) a claim under the workers’ compensation law of this
state, the Federal Employees Liability Act, or the Federal
Longshore and Harbor Workers’ Compensation Act; or
(2) the proceeds of an insurance policy in favor of the
injured individual or the injured individual’s beneficiary or legal
representative, except public liability insurance carried by the
insured that protects the insured against loss caused by an
accident or collision.
(c) A hospital lien described by Section 55.002(a) does not
attach to a claim against the owner or operator of a railroad
company that maintains or whose employees maintain a hospital in
which the injured individual is receiving hospital services.
§ 55.004. AMOUNT OF LIEN. (a) In this section,
“emergency hospital care” means health care services provided in a
hospital to evaluate, stabilize, and treat a serious medical
problem of recent onset or severity, including severe pain that
would lead a prudent layperson possessing an average knowledge of
medicine and health to believe that the condition, illness, or
injury is of such a nature that failure to obtain immediate medical
care would in all reasonable probability:
(1) seriously jeopardize the patient’s health;
(2) seriously impair one or more bodily functions;
(3) seriously harm an organ or other part of the body;
(4) cause serious disfigurement; or
(5) in the case of a pregnant woman, seriously
jeopardize the health of the fetus.
(b) A hospital lien described by Section 55.002(a) is for
the amount of the hospital’s charges for services provided to the
injured individual during the first 100 days of the injured
individual’s hospitalization.
(c) A hospital lien described by Section 55.002(a) may also
include the amount of a physician’s reasonable and necessary
charges for emergency hospital care services provided to the
injured individual during the first seven days of the injured
individual’s hospitalization. At the request of the physician, the
hospital may act on the physician’s behalf in securing and
discharging the lien.
(d) A hospital lien described by Section 55.002(a) does not
cover:
(1) charges for other services that exceed a
reasonable and regular rate for the services;
(2) charges by the physician related to any services
provided under Subsection (c) for which the physician has accepted
insurance benefits or payment under a private medical indemnity
plan or program, regardless of whether the benefits or payment
equals the full amount of the physician’s charges for those
services;
(3) charges by the physician for services provided
under Subsection (c) if the injured individual has coverage under a
private medical indemnity plan or program from which the physician
is entitled to recover payment for the physician’s services under
an assignment of benefits or similar rights; or
(4) charges by the physician related to any services
provided under Subsection (c) if the physician is a member of the
legislature.
(e) A hospital lien described by Section 55.002(a) is not
affected by a hospital’s use of a method of classifying patients
according to their ability to pay that is solely intended to obtain
a lien for services provided to an indigent injured individual.
(f) An emergency medical services lien described by Section
55.002(c) is for the amount charged by the emergency medical
services provider, not to exceed $1,000, for emergency medical
services provided to the injured individual during the 72 hours
following the accident that caused the individual’s injuries.
(g) An emergency medical services lien described by Section
55.002(c) does not cover:
(1) charges for services that exceed a reasonable and
regular rate for the services;
(2) charges by the emergency medical services provider
related to any services for which the emergency medical services
provider has accepted insurance benefits or payment under a private
medical indemnity plan or program, regardless of whether the
benefits or payments equal the full amount of the charges for those
services; or
(3) charges by the emergency medical services provider
for services provided if the injured individual has coverage under
a private medical indemnity plan or program from which the provider
is entitled to recover payment for the provider’s services under an
assignment of benefits or similar right.
(h) If the physician is employed in that capacity by an
institution of higher education, as defined by Section 61.003,
Education Code, and the lien does not include the amount of the
physician’s reasonable and necessary charges described by
Subsection (c), the physician has a lien on the cause of action in
the same manner as a hospital under this chapter. The lien is
subject to provisions of this chapter applicable to a hospital
lien, and the physician or the physician’s employing institution
may secure and enforce the lien in the manner provided by this
chapter.
§ 55.005. SECURING LIEN. (a) To secure the lien, a
hospital or emergency medical services provider must file written
notice of the lien with the county clerk of the county in which the
services were provided. The notice must be filed before money is
paid to an entitled person because of the injury.
(b) The notice must contain:
(1) the injured individual’s name and address;
(2) the date of the accident;
(3) the name and location of the hospital or emergency
medical services provider claiming the lien; and
(4) the name of the person alleged to be liable for
damages arising from the injury, if known.
(c) The county clerk shall record the name of the injured
individual, the date of the accident, and the name and address of
the hospital or emergency medical services provider and shall index
the record in the name of the injured individual.
§ 55.006. DISCHARGE OF LIEN. (a) To discharge a lien
under this chapter, the authorities of the hospital or emergency
medical services provider claiming the lien or the person in charge
of the finances of the hospital or emergency medical services
provider must execute and file with the county clerk of the county
in which the lien notice was filed a certificate stating that the
debt covered by the lien has been paid or released and authorizing
the clerk to discharge the lien.
(b) The county clerk shall record a memorandum of the
certificate and the date it was filed.
(c) The filing of the certificate and recording of the
memorandum discharge the lien.
§ 55.007. VALIDITY OF RELEASE. (a) A release of a cause
of action or judgment to which a lien under this chapter may attach
is not valid unless:
(1) the charges of the hospital or emergency medical
services provider claiming the lien were paid in full before the
execution and delivery of the release;
(2) the charges of the hospital or emergency medical
services provider claiming the lien were paid before the execution
and delivery of the release to the extent of any full and true
consideration paid to the injured individual by or on behalf of the
other parties to the release; or
(3) the hospital or emergency medical services
provider claiming the lien is a party to the release.
(b) A judgment to which a lien under this chapter has
attached remains in effect until the charges of the hospital or
emergency medical services provider claiming the lien are paid in
full or to the extent set out in the judgment.
§ 55.008. RECORDS. (a) On request by an attorney for a
party by, for, or against whom a claim is asserted for damages
arising from an injury, a hospital or emergency medical services
provider shall as promptly as possible make available for the
attorney’s examination its records concerning the services
provided to the injured individual.
(b) The hospital or emergency medical services provider may
issue reasonable rules for granting access to its records under
this section, but it may not deny access because a record is
incomplete.
(c) The records are admissible, subject to applicable rules
of evidence, in a civil suit arising from the injury.
Williams, McClure & Parmelee is dedicated to high quality legal representation of businesses and insurance companies in a variety of matters. We are experienced Texas civil litigation attorneys based in Fort Worth who know Texas courts and Texas law. For more information, please contact the law firm at 817-335-8800. The firm’s office location is 5601 Bridge Street, Suite 300, Fort Worth, Texas 76112.
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