El Paso Tool & Die Co., Inc. v. Carlos Mendez

COURT OF APPEALS
EIGHTH DISTRICT OF TEXAS
EL PASO, TEXAS
EL PASO TOOL AND DIE §
COMPANY, INC.,
No. 08-19-00087-CV
Appellant, §
Appeal from the
v. §
County Court at Law Number Three
§
CARLOS MENDEZ of El Paso County, Texas
§
Appellee. (TC# 2017-DCV0027)
§
OPINION
We granted El Paso Tool and Die Company, Inc. (El Paso Tool) the right to pursue a
permissive appeal from the denial of a motion for summary judgment. See TEX.CIV.PRAC. &
REM.CODE ANN. § 51.014(d) and (f) (authorizing and setting forth standards for permissive
appeals). The controlling legal issue that El Paso Tool advances is “[w]hether a general employee
of a temporary staffing agency may also be an employee of the staffing agency's client company
for purposes of the workers' compensation exclusive remedy provision.” The answer to that
question is undoubtedly “yes” under existing Texas Supreme Court precedent. But more
specifically, El Paso Tool contends that the trial court applied the wrong legal standard to answer
that question by looking to case law under the respondeat superior and borrowed servant doctrines,
rather than the standard developed under the Texas Labor Code for determining who is the
“employer” of an injured worker. On closer examination of the record, it is not clear to us that the
1
trial court in fact applied the wrong standard. Rather, it may have simply found a genuine issue
of material fact which precluded summary judgment. Accordingly, we conclude that the petition
for permissive review was improvidently granted and remand the case to the trial court.
I. BACKGROUND
Carlos Mendez lost all or parts of two fingers in an industrial accident on March 16, 2015.
According to the allegations in his lawsuit, he was employed by Elwood Staffing at the time of the
accident. He alleged that he was working as an independent contractor at El Paso Tool’s facility.
Specifically, he was working on a machine press that stamps out metal parts. When his hand was
in the working area of the machine, the stamping press unexpectedly came down and crushed
several of his fingers. His suit asserts common law negligence claims against El Paso Tool, and
product liability claims against the alleged manufacturer of the machine press. Only the claims
against El Paso Tool are before us.
El Paso Tool filed a motion for summary judgment, supported by the affidavit of its
President and sole shareholder, Salvador Robles. The affidavit claimed that Mendez was a
temporary laborer supplied to El Paso Tool under a contract with Elwood Staffing. His affidavit
stated that Mendez’s duties required him to operate metal press machines, and that he was injured
on one of those machines. The affidavit further claims that El Paso Tool was solely responsible
for scheduling hours, assigning work, and supervising Mendez’s daily activities. Robles also
averred that Mendez was: (1) supervised only by El Paso Tool, and not Elwood Staffing at the
time of the accident; (2) he was working at El Paso Tool’s facility; and (3) using a machine press
that it owned. Finally, the affidavit states that El Paso Tool had its own workers’ compensation
policy. From this, El Paso Tool urged that it was entitled to judgment as a matter law under the
2
exclusive remedy defense found in the Texas Labor Code. (hereinafter “the Act”)1 The motion
was based on El Paso Tool being a subscriber under the Act, and not that Elwood Staffing as a
temporary employment agency provided workers’ compensation insurance to all the employees
that it sent to client companies.2
Mendez’s response to the summary judgment alleged that El Paso Tool did not control the
specific details of his work at the time of his injury. Consequently, he asserted that he was not a
“borrowed servant” or an “employee” of El Paso Tool at the time of the accident. Alternatively,
he claimed that the evidence at least created a fact question on that issue. From the summary
judgment evidence, we gather that there was no signed contract between El Paso Tool and Elwood
Staffing, thus no written contractual term between those parties that defined Mendez’s
employment status. Rather, the parties relied only on affidavits and deposition testimony, either
from Mendez or El Paso Tool witnesses.
Mendez attached his own affidavit which states that no one from El Paso Tool “controlled
the specific details of the work I was performing at the time of the incident[.]” El Paso Tool had
indicated that Javier Berumen, Jr. was supervising Mendez’s work. Mendez’s affidavit, however,
states that Berumen did not “supervise my work in any way and was not even present when the
incident took place.” Other than showing him how to turn the machine press on or off, he swore
that no one from El Paso Tool trained him on how to do the job. Mendez also attached several
depositions to his response that we describe in more detail below.
1
TEX.LAB.CODE ANN. § 408.001(a) provides:
Recovery of workers' compensation benefits is the exclusive remedy of an employee covered by
workers' compensation insurance coverage or a legal beneficiary against the employer or an agent
or employee of the employer for the death of or a work-related injury sustained by the employee.
2
Contrast Robles v. Mt. Franklin Food, L.L.C., No. 08-18-00170-CV, 2019 WL 3812375, at *6 (Tex.App.--El Paso
Aug. 14, 2019, reh’g pending).
3
The trial court denied El Paso Tool’s motion. Its order states: “The Court finds that
TEX.LAB.CODE ANN. § 408.001 does not apply to the facts in this case because [Mendez] was
working as an independent contractor and not an employee of [El Paso Tool] at the time of
[Mendez’s] accident.” The order further finds that an interlocutory appeal would materially
advance the ultimate termination of the lawsuit, and that the trial court’s ruling turned on a
controlling issue of law: whether the exclusive remedy defense under Section 408.001 “applies
under the facts in this case.” El Paso Tool then asked this Court for permission to appeal under
TEX.CIV.PRAC. & REM.CODE ANN. § 51.014(d) and (f) which we granted.
II. DISCUSSION
A. The Exclusive Remedy Defense and Temporary Workers.
As the Texas Supreme Court has observed, Texas has stood alone in not requiring private
employers to provide workers’ compensation insurance. Port Elevator-Brownsville v. Casados,
358 S.W.3d 238, 241 (Tex. 2012). Texas does, however, encourage private employers to secure
coverage by (1) abolishing many common-law defenses in work-injury lawsuits if they do not
subscribe, and (2) providing a bar to ordinary negligence suits if they do. TEX.LAB.CODE ANN.
§ 406.033 (abolishing common-law defenses); Id. at § 408.001(a) (codifying exclusive remedy
defense). Thus, an employer who subscribes to workers' compensation insurance may raise the
exclusive remedy provision as a bar to a negligence claim filed against it. Casados, 358 S.W.3d
at 241.3
To invoke the exclusive remedy provision, a defendant must generally show that: (1) the
injured worker was an employee of the defendant at the time of the work-related injury, and (2)
3
The Act includes two notable exceptions to the exclusive remedy defense: (1) when an employee's death is “caused
by an intentional act or omission of the employer or by the employer's gross negligence[;]” or (2) when the employee
has validly opted out of the system prior to starting employment. TEX.LAB.CODE ANN. § 408.001(b) (intentional or
grossly negligent acts); TEX.LAB.CODE ANN. § 406.034 (opt-out provisions).
4
the injured worker was covered by workers' compensation insurance. See TEX.LAB.CODE ANN.
§ 408.001(a). An employee, however, may have more than one employer at the time of an injury
for the purposes of the exclusive remedies defense. In Wingfoot Enterprises v. Alvarado, for
instance, an injured worker sued both his employee leasing company and its client company
following the worker’s on-the-job-injury. 111 S.W.3d 134, 135 (Tex. 2003). The leasing company
obtained a summary judgment based on the exclusive remedy defense because it had provided
workers’ compensation insurance. Id. at 136. The case proceeded to trial against the client
company. The jury found that the worker was the “borrowed servant” of the client company,
which entitled the client company to the exclusive remedy defense. Id. The worker then
challenged on appeal the summary judgment in favor of the leasing company, contending that
there could be only one employer. The Texas Supreme Court disagreed: “[W]e conclude that the
Act's decided bias in favor of employers electing to provide coverage for their employees supports
our conclusion that the Act permits more than one employer for workers' compensation purposes.”
Id. at 140. Wingfoot’s holding protects temporary workers who have one general employer but
may move around to different worksites for different client companies. “[A]n employee should
not be placed in the position of trying to determine . . . which of two entities was his or her
employer on any given day[.]” Id.
The flipside--and thus the issue presented here--arose in Garza v. Excel Logistics, Inc., 161
S.W.3d 473 (Tex. 2005). In Garza, the client company sought to raise the exclusive remedy
defense. Id. at 476. That court first had to decide if the worker was the “employee” of the client
company. Id. The Labor Code defines an “employee” as “each person in the service of another
under a contract of hire, whether express or implied, or oral or written.” TEX.LAB.CODE ANN.
§ 401.012(a). The Garza court formulated this test for determining employee status:
5
[I]n determining if a general employee of a temporary employment agency is also
an employee of a client company for purposes of the Act, we consider traditional
indicia, such as the exercise of actual control over the details of the work that gave
rise to the injury.
Garza, 161 S.W.3d at 477; see also Wingfoot, 111 S.W.3d at 139 (the client company “become[s]
an employer by controlling the details of a worker’s work at the time of injury”). Garza held that
the temporary employee in that case was the client’s employee as a matter of law because, the
“undisputed evidence” showed that at the time of injury, Garza was (1) working on the client’s
premises, (2) in the furtherance of the client’s day-to-day business, and (3) the details of his work
that caused his injury were specifically directed by the client. Garza, 161 S.W.3d at 477.
The second issue before the Garza court was whether the client company proved that it had
a workers’ compensation policy. Id. at 477-78. It concluded that the client company failed to
conclusively prove the existence of a policy and remanded the case for that reason. Id. There is
no dispute here that El Paso Tool has such a policy. Instead, the only issues before us are whether
the trial court applied the Garza test (as opposed to some other test for employment), and second,
was the evidence similarly undisputed so as to provide only one clear answer to El Paso Tool’s
status as the employer.
B. Standard of Review
Two standards of review are relevant to this appeal. The first pertains to the summary
judgment motion filed below. We review a trial court's decision to grant summary judgment de
novo. Travelers Ins. Co. v. Joachim, 315 S.W.3d 860, 862 (Tex. 2010). Under a traditional motion
for summary judgment, the moving party carries the burden of showing that there is no genuine
issue of material fact and that it is entitled to judgment as a matter of law. TEX.R.CIV.P. 166a(c);
Helix Energy Sols. Group, Inc. v. Gold, 522 S.W.3d 427, 431 (Tex. 2017). Stated otherwise, El
Paso Tool must have conclusively negated one of the elements of Mendez’s claim, or as here,
6
conclusively established as a matter of law all the elements of an affirmative defense. Frost Nat'l
Bank v. Fernandez, 315 S.W.3d 494, 508 (Tex. 2010). Evidence is conclusive if reasonable people
could not differ in the conclusions drawn from it. Gold, 522 S.W.3d at 431. Once the movant
establishes its right to summary judgment, the burden then shifts to the non-movant to present
evidence which raises a genuine issue of material fact. See City of Houston v. Clear Creek Basin
Authority, 589 S.W.2d 671, 678 (Tex. 1979).
Evidence favorable to the non-movant is taken as true in deciding whether there is a
disputed issue of material fact. Fort Worth Osteopathic Hospital, Inc. v. Reese, 148 S.W.3d 94,
99 (Tex. 2004); Tranter v. Duemling, 129 S.W.3d 257, 260 (Tex.App.--El Paso 2004, no pet.). All
reasonable inferences, including any doubts, must be resolved in favor of the non-movant. Fort
Worth Osteopathic Hospital, 148 S.W.3d at 99.
We also deal here with a permissive appeal. Section 51.014(d) of the Texas Civil Practices
and Remedies Code permits an interlocutory appeal of an otherwise unappealable order, including
the denial of a summary judgment motion, if several predicates are met. See TEX.CIV.PRAC. &
REM.CODE ANN. § 51.014(d). To qualify, the trial court must first certify that the order is
immediately appealable, and expressly identify a controlling question of law on which there is
substantial ground for disagreement. Id.; see also TEX.R.CIV.P. 168 (requirement that trial court’s
order identifies a “controlling question of law as to which there is a substantial ground for
difference of opinion[.]”). Next, the trial court’s order must also explain why an immediate appeal
may materially advance the ultimate resolution of the case. TEX.CIV.PRAC. & REM.CODE ANN.
§ 51.014(d). Moreover, this Court must agree to hear the appeal. Id. at § 51.014(f).
Our procedural rules make it clear that we have the discretion to accept or deny a
permissive interlocutory appeal. Sabre Travel Int’l., Ltd. v. Deutsche Lufthansa AG, 567 S.W.3d
7
725, 732 (Tex. 2019) citing TEX.R.CIV.P. 168 and TEX.R.APP.P. 28.3. We exercise that discretion,
however, with an eye toward sparing parties “the inevitable inefficiencies of the final judgment
rule” when we can quickly and efficiently resolve “controlling, uncertain issues of law that are
important to the outcome of the litigation.” Id. But to that end, the controlling issue needs to be
solely a question of law unconstrained by procedural or factual issues. See Diamond Prods. Int'l,
Inc. v. Handsel, 142 S.W.3d 491, 494 (Tex.App.--Houston [14th Dist.] 2004, no pet.) (“The statute
does not contemplate permissive appeals of summary judgments where the facts are in dispute.
Instead, permissive appeals should be reserved for determination of controlling legal issues
necessary to the resolution of the case.”); College Station Med. Ctr., LLC v. Kilaspa, 494 S.W.3d
307, 313 (Tex.App.--Waco 2015, pet. denied) (“In a permissive interlocutory appeal, the issue
should be framed solely as a question of law that needs to be resolved that disposes of the case.”).
C. Application
We conclude that the permissive appeal should be dismissed as improvidently granted for
two reasons. First, it is not clear that the trial court applied the wrong legal test in deciding if
Mendez was El Paso Tool’s employee at the time of the accident. Thus, we cannot identify a
controlling issue of law that governs the outcome of the appeal. Second, and somewhat related,
the record contains disputed evidence over who controlled the details of the work that gave rise to
the injury and we cannot conclude this case can be resolved by applying an undisputed set of facts
to the prevailing law.
El Paso Tool argues that the trial court improperly applied the respondeat superior and
borrowed servant doctrines to decide this case. At the outset, the test for employee status under
the Act, and the tests for both borrowed servant and respondeat superior each include some
formulation for the “right of control.” Garza, 161 S.W.3d at 477 (employee status under the Act
8
determined by traditional indicia, such as actual right of control over details of work causing
accident); Limestone Products Distribution., Inc. v. McNamara, 71 S.W.3d 308, 312 (Tex. 2002)
(setting out factors for right of control in determining if company was responsible for driver’s
conduct); Sparger v. Worley Hosp., Inc., 547 S.W.2d 582, 583 (Tex. 1977) (stating that under the
borrowed servant doctrine the essential inquiry would be whether or not one party had the right to
control the other party in the details of the specific act raising the issue of liability). However, the
trial court’s order does not state that it used any particular formulation of the right of control test.
While the trial court found that Mendez was an “independent contractor,” that finding alone
does not direct us to any particular legal standard that the trial court used to resolve the case. The
fact-finder in this case will have to determine Mendez’s status while at El Paso Tool to determine
what duty, if any, was owed him (or what defenses may apply). He might be an “employee” of El
Paso Tool, but if not that, he might wear some other hat, like that of an “independent contractor.”
See Thompson v. Travelers Indem. Co. of Rhode Island, 789 S.W.2d 277, 279 (Tex. 1990) (finding
that evidence did not conclusively establish that jockey was employee of racetrack as distinct from
an independent contractor for purposes of Workers’ Compensation Act). The mere reference to
Mendez being an independent contractor does not instruct us that the trial court used an incorrect
legal standard.4
Neither does El Paso Tool identify what specific aspects of the respondeat superior or
borrowed servant doctrines were applied here that would be outcome determinative. The Texas
Supreme Court in Garza instructed that courts look to “traditional indicia” of employment, “such
4
We would take issue with the trial court making an affirmative finding that Mendez was an independent contractor.
Mendez did not move for summary judgment seeking that finding, and as we discuss above, and below, the evidence
on the right of control was conflicting. Given that procedural posture, the most the trial court could have done would
be to deny El Paso Tool’s summary judgment because it had not conclusively proved all the elements of its defense.
Mendez’s counsel conceded at oral argument that Mendez’s status is a disputed fact question that, based on this record,
must be decided by the fact-finder. Based on that concession, we find it unnecessary to accept the case to address the
independent contractor finding.
9
as the exercise of actual control over the details of the work that gave rise to the injury.” Garza,
161 S.W.3d at 477. The court ended its opinion by emphasizing that it was construing the Act and
“not applying general common-law principles regarding vicarious liability for injuries to third
parties.” Id. at 481. The court then restated what it said in Wingfoot:
The common-law principles that define when there will be vicarious liability are
designed to assign liability for injury to third parties to the party who was directing
the details of the negligent actor's conduct when that negligence occurred. The
Workers' Compensation Act was not.
Id., quoting in part Wingfoot, 111 S.W.3d at 146. And we certainly agree that not every aspect of
respondeat superior analysis should apply in this case. Respondeat superior seeks to make one
party pay for the acts of another. It would be relevant here if some third person was seeking to
make El Paso Tool responsible for some action of Mendez that, for instance, injured the third
person. At its heart, this is a public policy question of whether one party should be responsible for
another’s conduct based on having “such a degree of express or implied control over the actor to
justify imposing on him the consequences of the actor's wrongful conduct.” St. Joseph Hosp. v.
Wolff, 94 S.W.3d 513, 542 (Tex. 2002). Because we deal here with only the statutory dictates of
the Act, public policy does not factor into the equation. But neither is it clear that the trial court
used any public policy analysis to arrive at its decision. There may be other distinctions between
how right of control applies here and in common law applications. Our problem is that the trial
court’s order does not suggest that any of those distinctions made a difference in this case.
Similarly, we cannot tell whether the trial court misapplied any aspect of the borrowed
servant doctrine. The right of control test is at the heart of the borrowed servant doctrine and has
often been raised by client companies to bar claims by temporary workers through the exclusive
remedy defense. See Wesby v. Act Pipe & Supply, Inc., 199 S.W.3d 614, 619 (Tex.App.--Dallas
2006, no pet.) (holding that the client company was entitled to the exclusive remedy defense under
10
the borrowed servant doctrine); Flores v. N. Am. Techs. Group, Inc., 176 S.W.3d 442, 448
(Tex.App.--Houston [1st Dist.] 2004, pet. denied) (client company prevailed in summary judgment
claiming it was a borrowing employer of the temporary worker under the right to control test);
Richmond v. L.D. Brinkman & Co. (Texas) Inc., 36 S.W.3d 903, 905 (Tex.App.--Dallas 2001, pet.
denied) (client company entitled to exclusive remedy defense against injury claim of temporary
worker under borrowed servant doctrine); see also Phillips v. Am. Elastomer Products, L.L.C., 316
S.W.3d 181, 187 (Tex.App.--Houston [14th Dist.] 2010, pet. denied) (in claim by staffing agency
employee, court notes that “[w]hen there is a question as to whether one is an ‘employer’ under
the TWCA, Texas courts turn to the borrowed servant doctrine.”); Lockett v. HB Zachry Co., 285
S.W.3d 63, 75 (Tex.App.--Houston [1st Dist.] 2009, no pet.) (noting, in the workers' compensation
context, that “[b]orrowed employee status hinges on whether the other employer or its agents have
the right to direct and control the employee with respect to the details of the particular work at
issue”). So, while El Paso Tool faults the trial judge for relying on the right of control analysis
from borrowed servant doctrine cases, we are unable to say that (1) the trial court did so, or (2) if
it did, it did so in a way that was erroneous.
Our second issue with the appeal is the conflicting evidence on right of control. The trial
court’s order identifies the legal issue in this case as whether Section 408.001 precludes El Paso
Tool’s liability “under the facts of this case.” But the facts of this case appear to be disputed.
While El Paso Tool offered evidence that it controlled all the details of Mendez’s work, Mendez
stated just the opposite in his affidavit:
No one from El Paso Tool . . . controlled the specific details of the work I was
performing at the time of the incident, including Javier Berumen, Jr. -who did not
supervise my work in any way and was not even present when the incident took
place that caused me to suffer my injuries. No one from El Paso Tool . . . had the
right to control the progress, details, and methods of operation of the work I
performed, and I used my own means and methods without submitting myself to
11
the control of any other person from El Paso Tool . . . in performing the work. No
one from El Paso Tool . . . trained me on how to perform the work on the industrial
machine press. Manuel Castro only showed me how to turn the machine on and
off. No one from El Paso Tool . . . was supervising me or working with me when
the incident took place. No one from El Paso Tool . . . controlled the means and
details of the work that I performed while at the facility located at 10859 Pellicano
Drive.5
Other testimony from the summary judgment record indicated that if El Paso Tool needed
an additional press operator, it called Elwood Staffing and asked that one be sent over. Berumen,
the production control manager, described himself as Mendez’s supervisor for the whole time
Mendez was working there. Berumen gave out “job assignments” to the workers, including
Mendez, but he agreed that he did not give any directions to Mendez on how to operate the machine
press. Berumen admitted that during the entire time Mendez worked with the machine press, he
never went to oversee or supervise Mendez’s work to make sure he was operating the machine
correctly and he “didn’t know” if anyone else with El Paso Tool had done so. Instead, he believed
that Castro had trained Mendez on the machine. Yet Mendez swore that Castro only showed him
“how to turn the machine on and off.”
El Paso Tool responds that these factual disputes are not material. Instead, it argues that
because it assigned Mendez to the machine, and because the accident is tied to a claim that the
machine was defective, those two facts standing alone establish employer status under the Act. El
Paso Tool analogizes these facts to those in Garza, where the client company’s supervisor told the
temporary worker to walk across a moving conveyor belt that led to the injury producing event.
Garza, 161 S.W.3d at 477. The injured worker in Garza stated that he would have walked around
5
There are other parts of Mendez affidavit that we do not consider because they were struck by the trial court. Mendez
had also stated in his affidavit that he was an independent contractor. El Paso Tool objected to that statement as it
was conclusory, a legal conclusion, and beyond the witness’s qualifications. El Paso Tool objected to one other
sentence of the affidavit because it stated an opinion using “and/or” which made the conclusion ambiguous. The trial
court sustained these objections, eliminating these specific parts of the affidavit from the summary judgment record.
12
the conveyor belt, but for the instruction from the client company’s supervisor. Id. This case,
however, is not as clear. First, while El Paso Tool conceded they assigned Mendez to the machine,
everything else about who gave him instructions and training on the machine is disputed. Second,
while some of Mendez’s evidence and allegations focus on defects in the machine (its lack of
guards and a misplaced foot pedal), other allegations raised a variety of claims tied to how the
machine was used. He claims and presented some evidence, for instance, that El Paso Tool failed
to enforce safety rules, failed to warn of dangers, was negligent in its supervision, and failed to
train him in the operation of the machine. El Paso Tool’s accident report largely attributes the
accident to Mendez’s failure to use a metal hook to retrieve parts from the stamping area, and not
a defect in the machine. So, while it may be undisputed that El Paso Tool assigned Mendez to the
machine, what happened beyond that point, and what caused the accident, are not clearly
established by the summary judgment record.
Because we find some disputes as to who actually controlled the details of the work that
gave rise to the injury, this case is different from Garza where the relevant facts were undisputed,
and the client company specifically directed the very act that caused the injury. Id. And because
permissive appeals should be limited to those cases where we can resolve controlling legal issues
necessary to the resolution of the case, Handsel, 142 S.W.3d at 494, we exercise our discretion to
decide the permission to appeal was improvidently granted.
JEFF ALLEY, Chief Justice
December 4, 2019
Before Alley, C.J., Rodriguez, and Palafox, JJ.
Alley, C.J., Concurring
13