Court Holds that Claimant Waived Right to Recover Attorneys’ Fees
A Texas Court of Appeals has reversed a trial court’s judgment that awarded the claimant fee-shifted attorneys’ fees and has rendered judgment that the claimant and his attorney waived their right to recover those fees. The court also affirmed the trial court’s judgment that the claimant was not intoxicated at the time of his fatal accident.
In Unique Staff Leasing, Ltd., Self-Insured v. Cates, No. 11-14-00309-CV (July 29, 2016), the self-insured carrier filed suit for judicial review of a decision of the Division of Workers’ Compensation that held that the claimant was not intoxicated at the time he fell from a bucket truck and sustained serious, and ultimately fatal, head injuries.
Ultimately, there were two separate jury trials in this case. In the first trial, the sole question presented to the jury was whether the injured worker, Kody Cates, was intoxicated from the voluntary introduction of marihuana into his body when he sustained the injury that caused his death. The jury found that Kody was not intoxicated at that time. Later, in a separate jury trial, a different jury awarded fee-shifted attorney’s fees to the decedent’s beneficiaries. Texas Labor Code § 408.221(c) provides for the recovery of attorneys’ fees on top of the claimant’s recovery rather than out of the claimant’s recovery when a carrier files suit for judicial review and is not successful in reversing the Division’s decision. The trial court entered a judgment in which it incorporated the juries’ findings from the two trials. This included an award of nearly $80,000 in trial and conditional appellate attorneys’ fees.
The self-insurer (carrier) appealed the liability issue on the grounds that the claimant’s evidence that the decedent was not intoxicated at the time of the accident was legally and factually insufficient. The carrier contended that the presumption of intoxication could only be rebutted by competent expert testimony, which the carrier argued, had not been offered and admitted in the trial. The court of appeals rejected the carrier’s arguments.
[W]e hold that expert testimony is not required to rebut the presumption of intoxication under Section 401.013(c) of the Texas Labor Code. We agree with the Hinson court that lay witnesses are competent to testify as to whether an individual acted “normally” based on the witnesses’ observations. Our holding, however, should not be construed to opine one way or the other that lay witnesses are competent to testify as to whether an individual is intoxicated by marihuana or any other specific controlled substance. The evidence that is necessary to show that a person is acting normally, or is not intoxicated, is quite different than the evidence that is required to prove that a person is intoxicated.
The court then turned to the carrier’s argument that the claimant waived the right to recover attorneys’ fees. The court observed that the claimant failed to request that the trial court submit a jury question on attorney’s fees in the trial on Kody’s intoxication. In fact, the claimant failed to present any evidence of attorney’s fees in the first trial. Instead, the claimant filed a post-verdict motion in which she requested attorney’s fees and requested that the trial court enter judgment on the jury verdict. The court granted claimant’s motion and the attorneys’ fee issue was submitted to a second jury, which awarded the fees. The carrier argued that by failing to request jury questions on the attorneys’ fee issue in the first trial, the claimant waived her right to recover them. The court of appeals agreed, beginning its analysis by explaining the general rule.
Rule 279 of the Texas Rules of Civil Procedure provides that a ground of recovery is waived when no element of the ground of recovery is submitted to the jury. TEX. R. CIV. P. 279. Moreover, it is the responsibility of the party with the burden of proof on a ground of recovery to request that the issue be submitted to the jury. See id.; see also Cannon v. Sun-Key Oil Co., 117 S.W.3d 416, 422 (Tex. App.—Eastland 2003, pet. denied).
The claimant responded that several cases support the proposition that the proper appellate remedy is remand, not waiver, where the party with the burden of proof on attorney’s fees fails to present evidence and fails to request the submission of a question on attorney’s fees to the jury. The court distinguished those cases and rejected claimant’s argument.
First, Appellee relies on a case with similar facts to those before us, Commerce & Industry Insurance Co. v. Ferguson-Stewart, in which the First Court of Appeals remanded the attorney’s fees issue to the trial court for a separate jury trial. Commerce & Indus. Ins. Co. v. Ferguson-Stewart, 339 S.W.3d 744, 748–49 (Tex. App.—Houston [1st Dist.] 2011, no pet.). In Ferguson-Stewart, the claimant did not provide evidence or request the submission of a question on attorney’s fees to the jury. Id. at 748. Instead, the claimant, in a post-trial motion, requested that the trial court award attorney’s fees. Id. The First Court of Appeals found that remand was appropriate. Id. at 748–49. However, when the trial court awarded attorney’s fees, the Supreme Court of Texas had yet to decide Transcontinental Insurance Co. v. Crump. See id. at 748 (“CIIC relies on Transcontinental Insurance Co. v. Crump, decided after the conclusion of trial in this case . . . .”). Prior to the decision of the Supreme Court of Texas in Crump, it was unclear whether the jury or the trial court should decide the reasonableness and necessity of attorney’s fees under Section 408.221(c). Crump, 330 S.W.3d at 229 (finding ambiguous the statute that permits attorney’s fees under the Texas Labor Code). The Ferguson-Stewart court noted that “[t]he supreme court’s analysis in Crump shows that its conclusion was not an obvious one.” Ferguson-Stewart, 339 S.W.3d at 749. Consequently, because Crump was available to the court of appeals but not to the trial court and because the claimant attempted to pursue her right to recover attorney’s fees, the court in Ferguson-Stewart found that remand was the appropriate remedy. Id. at 748–49. Here, the parties and the trial court had the benefit of Crump prior to the first jury trial. Therefore, under Crump, Appellee should have presented evidence of and requested a jury question on the issue of attorney’s fees at the first trial.
Second, Appellee relies on Discover Property & Casualty Insurance Co. v. Tate, in which the claimant failed to request the submission of a jury question on attorney’s fees. Discover Prop. & Cas. Ins. Co. v. Tate, 298 S.W.3d 249, 251–52 (Tex. App.—San Antonio 2009, pet. denied). Again, however, the trial court’s judgment in Tate came prior to the decision of the Supreme Court of Texas in Crump. Because the law was unsettled as to whether a jury or the trial court should determine the reasonable amount of attorney’s fees under Section 408.221(c), and “in the interest of justice,” the San Antonio Court of Appeals found that remand was the appropriate remedy. Tate, 298 S.W.3d at 257 (“Tate [did not] waive[] his claim for fees by not submitting a jury issue on fees or objecting to its omission. Instead, in the interest of justice, we remand for a new trial on the amount of attorney’s fees.”).
Finally, Appellee argues that a case cited by Appellant in its brief, Z.A.O., Inc. v. Yarbrough Drive Center Joint Venture, supports her claim that she did not waive her right to recover attorney’s fees. Z.A.O., Inc. v. Yarbrough Drive Ctr. Joint Venture, 50 S.W.3d 531 (Tex. App.––El Paso 2001, no pet.). However, Z.A.O. is distinguishable from the case before us as well. In Z.A.O., the prevailing party prevailed in a contract dispute. Id. at 550. The problem in Z.A.O. was that the prevailing party failed to segregate the amount of attorney’s fees between its tort and contract causes of action. Id. Because the prevailing party was not entitled to recover attorney’s fees on its tort cause of action, the court remanded the attorney’s fees issue. Id. at 550–51.
We find that these cases do not support Appellee’s argument. Additionally, we have previously found that a party waives its right to recover attorney’s fees when it fails to put on evidence of attorney’s fees and fails to request the trial court to submit a question on attorney’s fees to the jury. Fuqua v. Oncor Elec. Delivery Co., 315 S.W.3d 552, 560 (Tex. App.––Eastland 2010, pet. denied) (holding that Oncor’s request for the trial judge, rather than the jury, to determine the reasonableness of its attorney’s fees and the failure to submit the question of attorney’s fees to the jury resulted in a waiver of Oncor’s claim for the recovery of attorney’s fees). Consequently, we hold that, under Rule 279, Appellee waived her right to recover attorney’s fees.
Although prior to Crump, it may have been routine for a claimant to request recovery of attorney’s fees in a post-trial motion, Crump clarified the insurance carrier’s right to a jury determination of the reasonableness and necessity of attorney’s fees. See Crump, 330 S.W.3d at 232. Because this case was tried approximately three years after the decision in Crump, the court of appeals did not find that justice requires affirmance of the trial court’s award of attorney’s fees after a second, separate jury trial on this issue.
FOLIO
