Nexion Health at Omaha, Inc., D/B/A Omaha Healthcare Center v. Virgie M. Martin ( 2010 )

In The
Court of Appeals
Sixth Appellate District of Texas at Texarkana
______________________________
No. 06-10-00017-CV
______________________________
NEXION HEALTH AT OMAHA, INC., D/B/A OMAHA HEALTHCARE
CENTER, Appellant
V.
VIRGIE M. MARTIN, Appellee
On Appeal from the 276th Judicial District Court
Morris County, Texas
Trial Court No. 24,199
Before Morriss, C.J., Carter and Moseley, JJ.
Memorandum Opinion by Chief Justice Morriss
MEMORANDUM OPINION
Virgie M. Martin was injured while working for her employer, Nexion Health at Omaha,
Inc., d/b/a Omaha Healthcare Center (Nexion). Martin sued Nexion for negligence. Nexion
denied the claims and moved to compel arbitration of Martin‘s claims under the terms of its
Employee Accident Plan (Plan). The trial court denied the motion to compel arbitration.
On appeal, Nexion argues that the trial court abused its discretion by failing to enforce the
arbitration clause. We reverse the trial court‘s order denying arbitration because (1) the Injury
Benefits Agreement (Agreement) was not fraudulently induced, (2) the Agreement is not
unconscionable, and (3) the Agreement is supported by adequate consideration.
Nexion does not subscribe to the Texas Workers‘ Compensation System; instead, it
provides benefits for on-the-job injuries under its own Plan. Employees could opt whether to
participate in the Plan by executing the Agreement, which incorporated the Plan by reference.
The Agreement includes mandatory binding arbitration ―for any and all disputes arising out of a
Bodily Injury, Accident . . . [and] any claim of negligence brought by an [e]mployee . . .,‖ as well
as ―any claim for benefits under the Plan . . ., any claim for wrongful discharge, any claim of
negligence brought by an employee, and any claim or action relating to the interpretation or
enforcement‖ of the Agreement. Under the terms of the Plan, Nexion reserved the ―right to
amend, modify, or terminate the Plan at any time.‖ Nexion employees could either accept and
―participate in and receive benefits under the Plan‖ or they could refuse to participate in the Plan
2
with the understanding that they would ―not receive any benefits (including payment of [their]
medical expenses) in the event of an on-the-job injury.‖
On February 22, 2007, believing that, if she declined to participate in the Plan, she would
have no legal remedies or recourse if injured on the job, Martin executed the Agreement, agreeing
to the terms of the Plan. Martin testified that she had to sign the Agreement in order to keep her
job, a claim that Nexion denies and the express terms of the Agreement contradict. She testified
that she read the Agreement, but did not have an opportunity to review it with an attorney.
About two years later, in January 2009, Martin sustained a work-related injury and filed
suit against Nexion, alleging that Nexion‘s negligence proximately caused her injuries. Nexion
denied the allegations of Martin‘s petition and moved to compel arbitration under the terms of the
Plan.
In response to the motion to compel arbitration, Martin argued that the arbitration
Agreement was invalid or unenforceable because it was a misleading and incorrect statement of
the law, lacked consideration, was unconscionable and unenforceable because the Plan‘s benefits
were substantially less generous than those available under the Texas Workers‘ Compensation
Act, and was an adhesion contract where Nexion had superior knowledge and bargaining power.
Nexion argued that the Agreement does not violate public policy, that the Agreement was
supported by consideration in that both parties gave up their right to a jury trial, that Martin
received medical treatment, and that she received $23,531.46 in medical benefits and wage
3
replacement benefits under the terms of the Plan. Martin does not deny receiving or accepting
those benefits. Nexion argued that, by accepting the benefits of the Agreement, Martin
acquiesced to the Agreement‘s provisions, including mandatory arbitration.
The trial court denied the motion to compel arbitration. No findings of fact or conclusions
of law were requested or filed.
In an accelerated appeal of an interlocutory order denying a motion to compel arbitration,
we review de novo the trial court‘s legal determinations and review its factual determinations
under a ―no evidence‖ standard. Trammell v. Galaxy Ranch School, L.P., (In re Trammell), 246
S.W.3d 815, 820 (Tex. App.—Dallas 2008, orig. proceeding); Dallas Cardiology Assocs. v.
Mallick, 978 S.W.2d 209, 212 (Tex. App.—Texarkana 1998, pet. denied). In reviewing the trial
court‘s factual determinations, we must credit favorable evidence if a reasonable fact-finder could
and disregard contrary evidence unless a reasonable fact-finder could not. Mallick, 978 S.W.2d at
212 (citing Kroger Tex. Ltd. P’ship v. Suberu, 216 S.W.3d 788, 793 (Tex. 2006); City of Keller v.
Wilson, 168 S.W.3d 802, 807 (Tex. 2005)). However, when the facts relevant to the arbitration
issue are not disputed, we are presented only with issues of law, and therefore, review de novo the
trial court‘s order. Trammell, 246 S.W.3d at 820. A ―no evidence‖ point requires the appellate
court to consider only the evidence and inferences tending to support the finding under attack and
to disregard all evidence and inferences to the contrary. Id.; Wetzel v. Sullivan, King & Sabom,
P.C., 745 S.W.2d 78, 79 (Tex. App.—Houston [1st Dist.] 1988, no writ) (citing Garza v. Alviar,
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395 S.W.2d 821, 823 (Tex. 1965)). Because no findings of fact or conclusions of law were filed,
we must uphold the trial court‘s decision if there is sufficient evidence to support it on any legal
theory asserted. Wetzel, 745 S.W.2d at 81.
The party seeking arbitration has the initial burden to establish his or her right to the
remedy under the contract; that is, to establish that a valid arbitration agreement exists. Cantella
Co. v. Goodwin, 924 S.W.2d 943, 945 (Tex. 1996) (per curiam); City of Alamo v. Garcia, 878
S.W.2d 664, 665 (Tex. App.—Corpus Christi 1994, no writ). In applying the law to the Federal
Arbitration Act, Texas courts have concluded that, once the existence of an arbitration agreement
has been established, then a presumption attaches favoring arbitration. Mallick, 978 S.W.2d at
212. At this point, the burden of proof shifts to the party seeking to avoid the arbitration
agreement to show that some grounds exist in law or in equity for the revocation, invalidation, or
avoidance of the contract. Id. Such grounds could include fraud, waiver, unconscionability, or
that the dispute was not within the scope of the agreement. Id. This is a proper placement of the
burden under Texas law, given the strong Texas presumption in favor of arbitration. See Brazoria
County v. Knutson, 142 Tex. 172, 176 S.W.2d 740, 743 (1943); Wetzel, 745 S.W.2d at 81.
In determining whether to compel arbitration, the court must decide two issues:
(1) whether a valid, enforceable arbitration agreement exists, and (2) if so, whether the claims
asserted fall within the scope of the agreement. BDO Seidman v. Miller, 949 S.W.2d 858, 860
(Tex. App.—Austin 1997, writ dism‘d w.o.j.); Nationwide of Fort Worth, Inc. v. Wigington, 945
5
S.W.2d 883, 884 (Tex. App.—Waco 1997, writ dism‘d w.o.j.). The court has no discretion and
must compel arbitration if the answer to both questions is affirmative. Merrill Lynch, Pierce,
Fenner & Smith v. Eddings, 838 S.W.2d 874, 878 (Tex. App.—Waco 1992, writ denied). Doubts
regarding the scope of arbitration agreements are resolved in favor of arbitration. Id. at 880.
In this case, neither party disputes that the Federal Arbitration Act governs the Agreement
in dispute, and Martin does not dispute that the Agreement existed or that her claims are covered
by it if the arbitration clause is valid and enforceable.1 Therefore, the trial court was required to
compel arbitration unless Martin proved that the Agreement was invalid or unenforceable. See
Canatella Co., 924 S.W.2d at 944. The trial court‘s order in the underlying case does not specify
the grounds for denying arbitration. Because an order denying arbitration must be upheld if it is
proper on any basis considered by the trial court, we will address all of Martin‘s defenses to the
Agreement. See Garcia, 878 S.W.2d at 665. At trial, Martin argued that the arbitration clause
was unenforceable because it was misleading, unconscionable, and illusory for lack of mutual
consideration.2 We address these arguments in turn.
1
Martin did not contest the existence and applicability of the arbitration provision at trial. Rather, Martin argued that
the arbitration provision was unenforceable and/or invalid.
2
Here, it is not argued that the attacks on the enforceability of the Agreement must be arbitrated. There are two types
of challenges to an arbitration provision: (1) a specific challenge to the validity of the arbitration agreement or clause,
and (2) a broader challenge to the entire contract, either on a ground that directly affects the entire agreement, or on the
ground that one of the contract‘s provisions is illegal and renders the whole contract invalid. Buckeye Check Cashing,
Inc. v. Cardegna, 546 U.S. 440, 444 (2006); In re Labatt Food Service, L.P., 279 S.W.3d 640 (Tex. 2009). A court
may determine the first type of challenge, but a challenge to the validity of the contract as a whole, and not just to the
arbitration clause, must go to the arbitrator. Cardegna, 546 U.S. at 448–49; see Prima Paint Corp. v. Flood &
Conklin Mfg. Co., 388 U.S. 395, 403–04 n.12 (1967) (claim of fraud in inducement of arbitration clause itself may be
6
(1) The Agreement Was Not Fraudulently Induced
At trial, Martin argued that the language of the option not to participate in the Plan was
misleading ―on its face‖ and that it misled her into believing that, if she rejected the Plan, she
would not receive any benefits and would have no recourse or remedies if she were injured on the
job. She asserted that she would not have agreed to participate in the Plan had she known that
opting not to participate in the Plan would enable her to sue Nexion in a court of law for any
on-the-job injuries she sustained. Because a claim that a contract term is ―misleading‖ does not
set up a defense to the contract, this point appears to claim, if anything, fraud in the inducement.
To prove fraudulent inducement, Martin had to show: (1) that Nexion made a material
misrepresentation, (2) that it was either known to be false when made or was asserted recklessly
without knowledge of its truth, and (3) that it was intended to be acted on, was relied on, and
caused injury. Formosa Plastics Corp. USA v. Presidio Eng’rs & Contractors, Inc., 960 S.W.2d
41, 47 (Tex. 1998). The issue here is whether the option not to participate is a misrepresentation.
Courts cannot determine the meaning of a contract‘s terms without examining them in the
context of the entire Agreement. See Tower Contracting Co. v. Flores, 157 Tex. 297, 302 S.W.2d
396, 399 (1957) (contractual meaning not derived from piecemeal portions of contract); see also
adjudicated by court, but court may not consider claim of fraud in inducement of contract generally). Similarly,
arbitrators generally must decide defenses that apply to the whole contract, while courts decide defenses relating
solely to the arbitration clause. Perry Homes v. Cull, 258 S.W.3d 580, 589 (Tex. 2008); see also In re FirstMerit
Bank, 52 S.W.3d 749, 756 (Tex. 2001) (defenses of unconscionability, duress, fraudulent inducement, and revocation
must specifically relate to arbitration part of contract, not contract as whole, if they are to defeat arbitration; validity of
arbitration provision is separate issue from that of whole contract). Because no claim is made that Martin‘s attacks on
the Agreement must, themselves, be arbitrated, we do not address such an issue.
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Crawford v. Pullman, Inc., 630 S.W.2d 377, 379–80 (Tex. App.—Houston [14th Dist.] 1982, no
writ).
Here, the Agreement is a mere two pages long, and an employee may choose either of the
following two options:
I accept this opportunity to participate in and receive benefits under the Plan.
OR
I reject this opportunity to participate in the Plan and understand that I will not
receive any benefits (including payment of my medical expenses) in the event of an
on-the-job injury.
Other than the option not to participate, the word ―benefit‖ or ―benefits‖ appears five times in the
Agreement,3 and every time, it directly references the Plan as the source of the benefits:
1. ―Nature of Injury Benefit Plan Payments‖
2. ―Plan benefit payments are not an admission of liability . . . by the
Company.‖
3. ―. . . any claim for benefits under the Plan . . . ‖
4. ―. . . the Plan‘s medical, disability, dismemberment, death and burial
benefits.‖
5. ―I accept this opportunity to participate in and receive benefits under
the Plan.‖
Specifically, the option to participate in the Plan directly references benefits ―under the Plan‖ and
that sentence is located immediately above the option to reject participation. The Agreement‘s
3
In contrast, the word ―damages‖ appears only once: ―when an employer does not have workers‘ compensation
insurance, an employee injured on the job can sue his employer and recover damages if the employer‘s negligence
caused the injury.‖
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text does not suggest that ―benefits‖ in the rejection clause should mean anything other than
―benefit‖ or ―benefits‖ as used in other places in the Agreement, that is, ―benefits under the Plan.‖
Also, the Agreement plainly informed Martin that (a) Nexion did not have Texas workers‘
compensation insurance, (b) ―when an employer does not have workers‘ compensation insurance,
an employee injured on the job can sue his employer and recover damages if the employer‘s
negligence caused the injury,‖ and (c) in exchange for the Plan‘s benefits, the signor agrees to
binding arbitration for, and is ―giving up the right to a jury trial on all of the claims‖ for, ―wrongful
discharge, any claim of negligence brought by an employee, and any claim or action relating to the
interpretation or enforcement of [the Agreement].‖ Those parts of the Agreement, and the
Agreement in general, serve to supply meaning to the word ―benefits‖ as used in the rejection
clause.
When read in the context of the entire Agreement, the phrase ―I . . . understand that I will
not receive any benefits (including payment of my medical expenses) in the event of an on-the-job
injury‖ unambiguously refers to benefits under the Plan, rather than all possible benefits, damages,
or other legal remedies. Therefore, the option to reject is neither misleading nor a material
misrepresentation.
(2) The Agreement Is Not Unconscionable
Martin also argued that the Agreement was unenforceable because it was unconscionable.
Unconscionable contracts are not enforceable under Texas law. In re Poly-America, L.P., 262
9
S.W.3d 337, 348 (Tex. 2008). However, according to the Texas Supreme Court, arbitration
agreements are not inherently unconscionable. In re Palm Harbor Homes, Inc., 195 S.W.3d 672,
678 (Tex. 2006). ―Because the law favors arbitration, the party opposing arbitration bears the
burden to prove unconscionability.‖ TMI, Inc. v. Brooks, 225 S.W.3d 783, 792 (Tex.
App.—Houston [14th Dist.] 2007, orig. proceeding) (citing FirstMerit Bank, 52 S.W.3d at 756).
The law recognizes two classes of unconscionability, each of which we will address.
―Procedural unconscionability‖ refers to the fairness of the circumstances surrounding adoption of
the arbitration provision, whereas ―substantive unconscionability‖ refers to the general fairness of
the arbitration provision itself. Palm Harbor Homes, 195 S.W.3d at 677.
The Agreement was not procedurally unconscionable.
At trial, Martin argued that the Agreement was unconscionable because it was an adhesion
contract in that Nexion had superior knowledge, because Nexion failed to explain the Plan,
because Nexion failed to disclose to Martin her right to sue Nexion as a nonsubscriber to workers‘
compensation, because Nexion failed to disclose the consequences of agreeing to binding
arbitration, because Nexion did not encourage her to consult with an attorney before agreeing to
the terms of the Agreement, and because agreeing to participate in the Plan was a condition of her
continued employment.
―Adhesion contracts are not automatically or per se unconscionable, and there is nothing
per se unconscionable about arbitration agreements.‖ In re Lyon Fin. Servs., 257 S.W.3d 228,
10
233 (Tex. 2008); In re AdvancePCS Health L.P., 172 S.W.3d 603, 608 (Tex. 2005). The Texas
Supreme Court has held that ―[t]he principles of unconscionability do not negate a bargain because
one party to the agreement may have been in a less advantageous bargaining position.‖ Palm
Harbor Homes, 195 S.W.3d at 679. Further, the Texas Supreme Court has held that it is not
unconscionable for Texas employers to offer at-will employees a take-it-or-leave-it agreement that
includes binding arbitration. In re Halliburton Co., 80 S.W.3d 566, 572 (Tex. 2002). The
take-it-or-leave-it agreement in this case is very similar to that in Halliburton; therefore, the
Agreement is not an unconscionable adhesion contract.
Absent a duty to disclose, such as in a confidential or fiduciary relationship, an agreement
is not unconscionable or fraudulent merely because one party was not informed as to the
arbitration provisions. See In re Green Tree Servicing LLC, 275 S.W.3d 592 (Tex.
App.—Texarkana 2008, orig. proceeding); see Emerald Tex., Inc. v. Peel, 920 S.W.2d 398,
402–03 (Tex. App.—Houston [1st Dist.] 1996, no writ). Here, there is no allegation in this case
that Nexion is in a fiduciary relationship with Martin; therefore, Nexion had no duty to explain the
Agreement‘s provisions to her. Even if Nexion were under a duty to disclose, the Agreement
informed Martin, as we have noted, that Nexion did not have workers‘ compensation insurance;
that, as such, Martin, if injured on the job, could sue for damages caused by Nexion‘s negligence;
and that Martin, to get Plan benefits, agreed to arbitration and gave up the right to a jury trial for
wrongful discharge, for negligence, or to interpret the Agreement.
11
As to Martin‘s claims that Nexion failed to encourage her to review the documents with an
attorney, and disclose and explain the Plan, the arbitration Agreement and Martin‘s rights, the
unambiguous language of the Agreement directly contradicts her argument. The Agreement
states, in part:
I acknowledge and understand that by signing this Agreement I am giving up the
right to a jury trial on all of the claims covered by this Agreement in exchange for
eligibility for the Plan‘s medical, disability, dismemberment, death and burial
benefits . . . .
....
I acknowledge that I have carefully read this Agreement, that I understand its terms,
and that this is our entire agreement on the subjects covered in this Injury Benefits
Agreement . . . I am aware of the consequences of signing this Agreement and, to
the extent that I deem necessary, I have consulted or will consult with an attorney.
Finally, I agree and acknowledge that signing this Agreement is not a condition of
my employment.
―The only cases under Texas law in which an agreement was found procedurally
unconscionable involve situations in which one of the parties appears to have been incapable of
understanding the agreement.‖ Fleetwood Enters., Inc. v. Gaskamp, 280 F.3d 1069, 1077 (5th
Cir. 2002). Under the general rule, every person who has the capacity to enter into a contract4 is
held to know what words were used in the contract, to know their meaning, and to understand their
legal effect. Indem. Ins. Co. of N. Am. v. W.L. Macatee & Sons, 129 Tex. 166, 101 S.W.2d 553,
556 (1937); In re Media Arts Group, 116 S.W.3d 900, 908 (Tex. App.—Houston [14th Dist.]
2003, orig. proceeding) (absent fraud, party to contract may not successfully claim belief that
4
There are no allegations that Martin lacked the capacity to enter into a contract.
12
provisions of contract were different from those plainly set out in contract or that he or she did not
understand language used); Amouri v. Sw. Toyota, Inc., 20 S.W.3d 165, 169 (Tex.
App.—Texarkana 2000, pet. denied). Moreover, ―a party to a written agreement is charged as a
matter of law with knowledge of its provisions . . . unless he can demonstrate that he was tricked
into its execution.‖ Town N. Nat’l Bank v. Broaddus, 569 S.W.2d 489, 492 (Tex. 1978) (quoting
Tex. Export Dev. v. Schleder, 519 S.W.2d 134, 139 (Tex. Civ. App.—Dallas 1974, no writ)).
Here, there is no evidence that Martin was incapable of reading or understanding the
Agreement; therefore, she is deemed by the law to have understood the consequences of signing
the Agreement, acknowledged that she was giving up her right to jury trial in exchange for benefits
under the Plan, and decided that she would consult with an attorney if she deemed it necessary.
Martin also contends that the Agreement was unconscionable because agreeing to the
terms of the Agreement was a condition of her employment. On direct examination, she was
asked, ―[W]ere you asked to sign this [Agreement] form as well as some others to keep your job at
Nexion?‖ Martin responded, ―Yes.‖ However, the express terms of the Agreement contradict
Martin‘s testimony. The Agreement unambiguously states, ―I agree and acknowledge that
signing this Agreement is not a condition of my employment.‖ (Emphasis added.)
Because an employer has a general right under Texas law to discharge an at-will employee,
it cannot be unconscionable, without more, merely to premise continued employment on
acceptance of new or additional employment terms. Halliburton, 80 S.W.3d at 572 (citing Smith
13
v. H.E. Butt Grocery Co., 18 S.W.3d 910, 912 (Tex. App.—Beaumont 2000, pet. denied)
(rejecting argument that arbitration provision is unconscionable merely because parties did not
negotiate its terms)). In the only case Martin cites in support of her argument, Halliburton, 80
S.W.3d at 567, the Texas Supreme Court held that an arbitration provision imposed as a condition
of employment was not unconscionable. In In re Poly-America, L.P., 262 S.W.3d 337, 360–61
(Tex. 2008), the court found limited-liability provisions within the contract unenforceable, but
upheld the trial court‘s order compelling arbitration despite the agreement being a condition of
employment. Based on the analysis in Poly-America and Halliburton, even the imposition of an
arbitration provision as a condition of employment would not have violated public policy. See
also DRC Parts & Accessories, L.L.C. v. VM Motori, S.P.A., 112 S.W.3d 854, 858 (Tex.
App.—Houston [14th Dist.] 2003, pet. denied) (to give purpose and effect to written contracts,
party may not justifiably rely on oral representation directly contradicting unambiguous contract
terms).
The Agreement is not procedurally unconscionable. But Martin claims also that it is
substantively unconscionable.
―The test for substantive unconscionability is whether, ‗given the parties‘ general
commercial background and the commercial needs of the particular trade or case, the clause
involved is so one-sided that it is unconscionable under the circumstances existing when the
parties made the contract.‘‖ Palm Harbor Homes, Inc., 195 S.W.3d at 678 (quoting FirstMerit
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Bank, 52 S.W.3d at 757). It is well-settled law that, alone, an employee‘s preinjury waiver of the
right to sue under a nonsubscriber‘s voluntary benefit plan does not violate public policy. See
Halliburton, 80 S.W.3d at 567, 572; see also Poly-America, 262 S.W.3d at 360–61. An
agreement to arbitrate is not substantively unconscionable if the employee did not waive any
substantive rights and simply agrees to have those rights determined in a different forum.
Halliburton, 80 S.W.3d at 572 (citing Beauchamp v. Great W. Life Assurance Co., 918 F. Supp.
1091, 1098 (E.D. Mich. 1996)). Here, as in Halliburton, Martin did not waive her rights to bring
suit against Nexion; rather, she merely agreed to have those claims heard by an arbiter.
Therefore, the Agreement is not substantively unconscionable.
We overrule Martin‘s claims that the Agreement is unconscionable.
(3) The Agreement Is Supported by Adequate Consideration
Martin also argued that the Agreement was illusory due to a lack of mutual consideration,5
because Nexion could terminate or amend the Agreement at any time.6 We disagree.
Mutual promises to submit employment disputes to arbitration are sufficient consideration.
J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 228 (Tex. 2003). An arbitration agreement is
5
Martin also claimed that the illusory nature of the Agreement rendered it unconscionable.
6
Some discussion at the hearing and in Martin‘s brief implies that the validity of the agreement is affected by whether
Martin signed it during, or at the outset of her employment with Nexion. An employer may enforce an arbitration
agreement entered into during an at-will employment relationship if the employee received notice of the employer‘s
arbitration policy and accepted it by continued employment. In re Dillard Dep’t Stores, Inc., 181 S.W.3d 370, 375
(Tex. App.— El Paso 2005, orig. proceeding) (per curiam) (citing Halliburton, 80 S.W.3d at 568). Here, it is
undisputed that Martin knew of, read, and agreed to the terms of the Agreement, including the arbitration clause. We
conclude that whether the Agreement was signed before or during Martin‘s employment is irrelevant because, as a
matter of law, neither Martin‘s hiring nor her continued employment was consideration for the Agreement.
15
not illusory unless one party can avoid its promise by amending or terminating the arbitration
provisions. Halliburton, 80 S.W.3d at 570. In Halliburton, the Texas Supreme Court considered
and upheld an arbitration clause which provided that ―no amendment shall apply to a Dispute of
which the Sponsor [Halliburton] had actual notice on the date of amendment‖ and that
―termination shall not be effective until 10 days after reasonable notice of termination is given to
Employees or as to Disputes which arose prior to the date of termination.‖ Id. at 569–70.
Here, the right to amend or terminate is similar to the right in Halliburton. The
Agreement provided that Nexion reserved ―the right to amend, modify, or terminate the Plan at any
time.‖ The Agreement, however, went further:
No amendment or termination of the Plan will reduce the amount of any benefit
then due and payable under the Plan to or with respect to a participant in connection
with an Injury occurring prior to the date of such amendment or termination. If
you have chosen to ―accept‖ Plan benefits and [Nexion] ever amends the Plan to
reduce those benefits, then you will have an opportunity to revoke your benefits
election with respect to any later on-the-job injury.
Therefore, Nexion‘s right to amend or terminate the Plan does not deprive an employee of rights
and benefits already accrued under the Plan before the amendment or termination. Id. If the
Plan‘s benefits are ever reduced, employees will have an opportunity to revoke their acceptance; if
the Plan is ever terminated, it will leave the employees with all of their common-law rights against
16
Nexion as a nonsubscriber. See id.; see also TEX. LABOR CODE ANN. § 406.033(a) (Vernon
2006).7 Therefore, the Agreement is supported by adequate consideration.
For the foregoing reasons, the Agreement to submit the parties‘ dispute to arbitration is
binding, and we reverse the trial court‘s order denying arbitration and remand the case to the trial
court for further proceedings consistent with this opinion. See Meyer v. WMCO-GP, LLC, 211
S.W.3d 302, 308 (Tex. 2006).
Josh R. Morriss, III
Chief Justice
Date Submitted: June 17, 2010
Date Decided: July 7, 2010
7
In 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 the employment, it is not a defense
that:
(1) the employee was guilty of contributory negligence;
(2) the employee assumed the risk of injury or death; or
(3) the injury or death was caused by the negligence of a fellow servant.
17