ACE American Insurance Company v. Clayton D. Elmer

Affirm and Opinion Filed September 15, 2020
In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-19-00386-CV
ACE AMERICAN INSURANCE COMPANY, Appellant
V.
CLAYTON D. ELMER, Appellee
On Appeal from the 14th Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-17-06888
MEMORANDUM OPINION
Before Chief Justice Burns, Justice Molberg, and Justice Carlyle
Opinion by Justice Molberg
Ace American Insurance Company (Ace) appeals the judgment for Clayton
D. Elmer in its suit for judicial review of a Decision and Order (Decision) issued in
favor of Elmer by the Texas Department of Insurance, Division of Workers’
Compensation Division (Division), after a contested case hearing regarding injuries
sustained by Elmer while working as a truck driver for Heartland Express.1
1
Elmer was not represented by counsel at the Division proceedings. Instead, he utilized the free
ombudsman assistance provided for pro se claimants in administrative disputes.
Following a bench trial, the trial court entered judgment in favor of Elmer and
awarded attorney’s fees.
Ace raises four issues on appeal: (1) the trial court erred by finding Elmer’s
work injury extends to and includes depression, anxiety disorder, and chronic pain
syndrome; (2) the trial court erred by finding Elmer’s date of maximum
improvement is June 21, 2016, with an impairment rating of forty-five percent;
(3) the trial court erred by awarding attorney’s fees because Elmer should not have
prevailed at trial, or, alternatively, Elmer waived his fees by presenting no
supporting evidence; and (4) the trial court entered an invalid judgment because it
neither conformed with the evidence at trial nor complied with Texas Labor Code
section 410.258. TEX. LAB. CODE § 410.258. Elmer did not file a response brief.
We affirm the trial court’s judgment.
BACKGROUND
On June 16, 2014, Elmer injured himself at work when his foot slipped while
stepping out of a tractor-trailer (the work injury). He reported the incident
approximately an hour-and-a-half later when he checked in with his dispatcher
regarding his route to Waco. Elmer stopped several times along his route to get ice
to relieve pain in his shoulder and knee. After finishing his route and dropping off
the truck, his wife took him to the emergency room. Elmer eventually required
surgeries on his left knee and left shoulder.
–2–
Due to post-injury pain, Elmer was able to engage only in limited physical
activity. In February 2016, the parties agreed Elmer’s defined compensable injury
included a left-knee medial meniscus tear, a left-knee lateral meniscus tear, a left-
shoulder rotator cuff tear (original and recurrent), and left-shoulder bicipital
tenosynovitis. At that time, Elmer did not claim he suffered chronic pain, anxiety,
or depression related to the work injury.
On January 30, 2017, the Division held a contested case hearing. Elmer was
the only witness, but he presented multiple reports from workers’ compensation
doctors and medical care providers who had examined him and determined he
suffered from chronic pain syndrome, depression, and anxiety as a direct result of
the effects of the compensable injury. Elmer was treated for chronic pain syndrome,
depression, and anxiety by several medical providers. Experts who opined in favor
of Elmer included Dr. Maggie Perish, Dr. Tommy Overman, Dr. Robert Panzarella,
and Marce Hufnagel, M.Ed., LPC.
Dr. Panzarella—the Division-appointed designated doctor—opined that
Elmer’s compensable injury extended to and included chronic pain syndrome,
depression, and anxiety, which arose from and were directly related to the work
injury. According to Dr. Panzarella, Elmer reached maximum medical improvement
(MMI) on June 21, 2016, with a whole person impairment rating of forty-five
percent. The insurance carrier’s expert witness, Dr. Andrew Brylowski, who had
examined and talked with Elmer for approximately three hours, determined Elmer
–3–
reached MMI on June 2, 2016, with a whole person impairment rating of eleven
percent.
Finding in favor of Elmer, the Division’s Decision noted Elmer “presented
multiple reports from multiple care providers who have determined that [Elmer] is
experiencing chronic pain syndrome, depression, and anxiety as a direct result of the
effects of the compensable injury.” Dr. Brylowski, the “carrier-selected post-
designated doctor,” was the “only doctor who did not believe that [Elmer] sustained
the disputed conditions,” i.e., chronic pain syndrome, depression, and anxiety
(emphasis added). According to the Division, Dr. Brylowski’s “analysis of the
results of his testing was contradictory.” The Decision observed:
On the one hand, [Dr. Brylowski] stated that his testing showed
that [Elmer] was not overreporting his symptoms and that the tests
reflected a technical validity of the results. Then, in the same
report, he maintained that the testing was consistent with
overreporting that allegedly invalidated a mental and behavioral
impairment rating. Yet Dr. Brylowski also stated that people with
some of the test results he obtained tended to experience anxiety,
depression, and withdrawal from every day activities.
The Decision further stated that “Dr. Brylowski’s opinion was, at best, much less
persuasive than the rest of the medical record” and was “contrary to [Elmer’s]
testimony and all of the other medical evidence in the record.”
The Division concluded Elmer’s chronic pain syndrome, anxiety disorder, and
depression were caused or aggravated by, and did arise out of or naturally flow from,
the work injury. It further concluded the MMI date was June 21, 2016, with an
impairment rating of forty-five percent. Ace was ordered to pay benefits in
–4–
accordance with the Division’s Decision. After exhausting its administrative
remedies, Ace appealed the adverse determination in district court.
The only evidence presented during the bench trial was Elmer’s live testimony
and Dr. Brylowski’s expert report and deposition testimony. At trial, Elmer testified
that prior to the work injury, he was not being treated for depression, anxiety, or
chronic pain; and his chronic pain developed after the injury and “limited his ability
to do physical activities.” Elmer told the trial court he received both medical and
psychological treatment as a result of the work injury. Over Ace’s objection, Elmer
testified he was “first diagnosed with depression or anxiety” in “[m]id 2015” by
Dr. Perish, who gave him “psychological testing” and treatment; “[Dr. Perish’s]
records were in evidence at the Contested Case Hearing”; other counselors also
treated Elmer and “[a]s part of the Workers’ Comp process [he was] requested or
ordered to go to examinations by [three] doctors other than [his] treating doctors”;
and he received treatment with counselors for anxiety, depression, and chronic pain.
The trial court overruled Ace’s hearsay objection on the grounds that statements
made for the purpose of medical treatment are an exception to the hearsay rule. See
TEX. R. EVID. 803(4). Elmer testified that for and during the course of his medical
treatment:
Things we spoke about was my love to work, my love of family
and how it’s diminished of where I don’t see my family hardly any
more; the difficulties of just daily living and self-care; and just
empty and worthless feeling; not being able to be a provider.
–5–
The trial court found in favor of Elmer and entered findings of fact and
conclusions of law. In its Final Judgment, the trial court stated:
Defendant Clayton Elmer credibly testified as to his treatment of
chronic pain, depression and anxiety as part of his workers’
compensation injury, and of examples of pain interfering with acts
of daily living, as well as difficulties with his left shoulder and left
knew. He testified he was diagnosed and treated for these
conditions after his 2014 compensable injury by his workers
compensation doctors, and before a subsequent injury in 2015 at
physical therapy.
ANALYSIS
Sufficiency of the Evidence
Ace’s first and second issues and the first part of his fourth issue challenge
the sufficiency of the evidence to support the trial court’s judgment. In its first issue,
Ace argues, “[t]he trial court erred in finding Elmer’s work injury extends to and
includes depression, anxiety disorder, and chronic pain syndrome, as the only expert
evidence offered at trial found those conditions were not related, the trial court relied
on information not admitted during trial, and the trial court held ACE to the incorrect
burden of proof.” Ace’s second issue contends “[t]he trial court erred in finding
Elmer’s date of maximum medical improvement is June 21, 2016 with an
impairment rating of 45% as it failed to adopt the only valid impairment rating
submitted into evidence . . . .” And the first part of Ace’s fourth issue argues the
–6–
trial court’s judgment was not valid because it “fail[ed] to conform to the evidence
presented at trial.”2
Standard of Review
We apply a “modified de novo review” standard to a judicial review of a Texas
Workers’ Compensation Commission Appeals Panel’s final decision. Tex. Workers’
Comp. Comm’n v. Garcia, 893 S.W.2d 504, 530 (Tex. 1995). Under this standard,
a trial court may review “only those issues finally decided by the Division’s Appeals
Panel.” Tex. Dept. of Ins., Workers’ Comp. Div. v. De Los Santos, 446 S.W.3d 800,
806 (Tex. App.—San Antonio 2014, no pet.). The party seeking judicial review of
an appeals panel decision bears the burden of proof by a preponderance of the
evidence. Id.; TEX. LAB. CODE § 410.303. In a bench trial, the trial court “shall
consider the decision of the appeals panel” in rendering its judgment. 3 TEX. LAB.
CODE § 410.304(b) (emphasis added); see also De Los Santos, 446 S.W.3d at 806
(“When a court is the trier of fact, it is to consider the decision of the Division’s
Appeals Panel.”); Tex. Workers’ Comp. Ins. Fund v. Simon, 980 S.W.2d 730, 737 at
n.4 (Tex. App.—San Antonio 1998, no pet.).
2
The second part of Ace’s fourth issue contends “the Texas Department of Insurance was not informed
of the proposed judgment 30 days prior the entry [sic] of a final order as required by the Texas Labor Code
§ 410.258.”
3
The fact finder, however, is not required to accord the decision any special weight. See Bruno v.
Trinity Univ. Ins. Co. of Kan., No. 13-03-038-CV, 2004 WL 2904308, at *1 (Tex. App.—Corpus Christi,
Dec. 16, 2004, no pet.) (mem. op.).
–7–
Following a bench trial, a trial court’s findings are reviewed according to the
legal sufficiency standards by which jury findings are measured. Catalina v.
Blasdel, 881 S.W.2d 295, 297 (Tex. 1994). In determining whether the evidence is
legally sufficient to support a finding, we consider the evidence in the light most
favorable to the judgment and indulge every reasonable inference that would support
it. See City of Keller v. Wilson, 168 S.W.3d 802, 826–27 (Tex. 2005). We credit
favorable evidence if a reasonable fact finder could and disregard contrary evidence
unless a reasonable fact finder could not. Id. at 827. When the evidence offered to
prove a vital fact is so weak as to do no more than create a mere surmise or suspicion
of its existence, the evidence is less than a scintilla and, in legal effect, is no
evidence. See Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 601 (Tex. 2004) (citing
Kindred v. Con/Chem., Inc., 650 S.W.2d 61, 63 (Tex. 1983)). More than a scintilla
of evidence exists if the evidence rises to a level that would enable reasonable and
fair-minded people to differ in their conclusions. Ford Motor Co., 135 S.W.3d at
601 (citing Merrell Dow Pharm., Inc. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997)).
The fact finder is the sole judge of the credibility of the witnesses and the weight
give their testimony. City of Keller, 168 S.W.3d at 819. It is the province of the fact
finder to resolve any conflicts in the evidence. Id. at 820. So long as the evidence
falls within a zone of reasonable disagreement, we may not substitute our judgment
for that of the fact finder. Id. at 822.
–8–
Section 410.258’s Notice Requirement Does Not Apply
To The Trial Court’s Judgment In This Case
We first address Ace’s argument in the second part of its fourth issue that the
trial court’s failure to file any proposed judgment with the Division not later than the
thirtieth day before the date on which the court is scheduled to enter the judgment
renders the judgment void. We disagree with Ace. Section 410.258 would have
required Ace—as the party initiating the proceeding—to give the Division advance
notice of a “proposed default judgment” or “proposed agreed judgment.” TEX. LAB.
CODE § 410.258(a). Here, the trial court’s judgment followed a contested trial.
Thus, section 410.258’s notice requirement did not apply to the trial court’s
judgment. Clewis v. Safeco Ins. Co. of America, 287 S.W.3d 197, 202–203 (Tex.
App.—Fort Worth 2009, no pet.) (concluding section 410.258(a)’s notice
requirement only applies to “judgments entered apart from completed adversarial
proceedings” and not judgments following a contested trial); see also Tex. Prop. &
Cas. Ins. Guar. Ass’n for Petrosurance Cas. Co. v. Brooks, 269 S.W.3d 645, 649–
50 (Tex. App.—Austin 2008, no pet.) (concluding section 410.258(a) does not apply
to judgments “entered by the trial court that were not submitted or proposed to the
court by agreement of the parties or the result of a default by the defendant”). We
resolve the second part of Ace’s fourth issue against it.
–9–
Ace Failed to Provide A Complete Record On Appeal
It is the appellant’s burden to supply an appellate court with a complete record
demonstrating why the trial court reversibly erred. Christiansen v. Prezelski, 782
S.W.2d 842, 843 (Tex. 1990). Ace did not do so in this case.
The trial transcript reflects that during his direct examination of Elmer, Ace’s
counsel directed Elmer and the trial court to the records and transcript of the case
hearings before the administrative agency.
The Court: Identify the records for [Elmer’s attorney], please.
[Ace’s attorney]: Prior sworn testimony.
The Court: In what matter, please?
[Ace’s attorney]: In this matter before the administrative agency.
The Court: Okay.
[Ace’s attorney]: Page 34
....
[Elmer’s attorney]: There were three different contested case
hearings in this case on different issues.
The Court: Will you identify—
....
[Ace’s attorney]: Transcript January 30th of 2017.
Ace’s counsel proceeded to question Elmer, without objection, about his testimony
in the January 30, 2017, administrative agency hearing. Because the parties and the
trial court treated the hearing transcript—which was raised and discussed by Ace’s
–10–
counsel at trial—as if it had been admitted into evidence, we conclude it was “for all
practical purposes, admitted.” Schott Pelley P.C. v. Wynne, 578 S.W.3d 694, 703
(Tex. App.—Dallas 2019, pet. denied) (quoting Travelers Indem. Co. of R.I. v.
Starkey, 157 S.W.3d 899, 904 (Tex. App.—Dallas 2005, pet. denied)). Ace,
however, did not include the transcript or record from that hearing in the record on
appeal.
Because the burden was on Ace to ensure the record on appeal is complete, it
is presumed that the omissions support the trial court’s judgment. On that basis
alone, we must affirm the trial court’s judgment. See Starkey, 157 S.W.3d at 904–
05; Sandoval v. Comm’n for Lawyer Discipline, 25 S.W.3d 720, 722 (Tex. App.—
Houston [14th Dist.] 2000, pet. denied).
The Evidence Was Sufficient To Support The Judgment
Even if Ace had not failed to provide a complete record on appeal, the trial
court still did not err because the evidence was sufficient to support the judgment.
In a workers’ compensation case, the party seeking judicial review of an appeals
panel decision has the burden of proof by a preponderance of the evidence. TEX.
LAB. CODE § 410.303. While Ace concedes that—as the party appealing the
administrative findings—it had the burden of proof in the trial court, it argues that
after it presented Dr. Brylowski’s expert report and deposition testimony, the burden
shifted back to Elmer to present expert testimony to contradict Dr. Brylowski and
establish a positive connection between the work injury and Elmer’s depression,
–11–
anxiety disorder, and chronic pain syndrome. According to Ace, because Elmer did
not present contradictory expert testimony, its expert witness conclusively
established the lack of causation. We disagree.
Under a sufficiency analysis, Ace’s expert testimony “must be examined in
the context of asking whether” a reasonable fact finder could have “disregarded it or
reached a contrary result” or whether a reasonable fact finder could have “believed
the evidence favorable to” Elmer. See State Office of Risk Management v. Ribble,
No. 03-12-00084-CV, 2014 WL 4058936, at *2 (Tex. App.—Austin Aug. 13, 2014,
no pet.) (mem. op.). “The final test for legal sufficiency must always be whether the
evidence at trial would enable reasonable and fair-minded people to reach the verdict
under review.” City of Keller, 168 S.W.3d at 827.
We reject Ace’s argument the trial court erred by considering the Decision in
reaching its judgment. To the contrary, the trial court properly considered the
Decision, which was attached to Elmer’s trial brief on judicial review of the
Decision, and part of the trial court’s record. TEX. LAB. CODE § 410.304(b); Simon,
980 S.W.2d at 737 n.4 (“A trial court must consider the Appeals Panel decision in
reaching a judgment.”).
The circumstances in this case are remarkably similar to those in Liberty
Mutual Insurance Co. v. Burk, 295 S.W.3d 771 (Tex. App.—Fort Worth 2009, no
pet.). In Burk, Liberty Mutual had attached the appeals panel decision to its original
petition, but the decision was not admitted into evidence at trial. Only Roy Burk
–12–
(the injured worker) and Dr. Leonard Hershkowitz (Liberty Mutual’s retained expert
witness) testified at trial. Liberty Mutual argued—as Ace does here—that:
(1) because the appeals panel decision was not admitted into
evidence, it was “not evidence that can support the trial court’s
judgment,”
(2) because “Dr. Hershkowitz’s testimony was uncontroverted [it
was] therefore conclusive,”
(3) “there [was] no evidence to support the trial court’s judgment
because Burk did not offer testimony from a medical expert at trial
. . . [and] expert medical testimony is required where the injury or
condition is beyond the scope of common knowledge and
experience of the fact finder,” and
(4) the evidence therefore was insufficient to support the trial
court’s finding that Burk’s work-related injury caused his
polyneuropathy and foot ulcerations.
Rejecting Liberty Mutual’s arguments and concluding the evidence was
legally sufficient to support the trial court’s finding that Burk’s work-related injury
caused his polyneuropathy and foot ulceration, the Forth Worth court of appeals
stated:
“It is well recognized that a trial court may take judicial notice of
its own records in a cause involving the same subject matter
between the same, or practically the same, parties.” Sierad v.
Barnett, 164 S.W.3d 471, 481 (Tex. App.—Dallas 2005, no pet.)
. . . . Once the trial court took judicial notice of the appeals panel
decision, it was evidence in the case that could potentially support
the trial court’s judgment. . . .
Burk, 295 S.W.3d at 779.
–13–
The Burk court also rejected the exact argument made by Ace in this case—
that because Dr. Hershkowitz’s testimony was uncontroverted by opposing expert
testimony, it was conclusive:
As the party appealing the appeals panel decision, Liberty Mutual
had the burden to prove by a preponderance of the evidence that
Burk’s work-related injury did not cause his polyneuropathy and
foot ulceration. Despite Liberty Mutual’s burden of proof, Liberty
Mutual argues there is no evidence to support the trial court’s
judgment because Burk did not offer testimony from a medical
expert at trial. In doing so, Liberty Mutual cites cases for the
proposition that expert medical testimony is required where the
injury or condition is beyond the scope of common knowledge and
experience of the fact finder. While the legal proposition is
facially correct, Liberty Mutual appears to ask us to apply the
proposition against Burk, who did not have the burden of proof at
trial, and hold that Burk presented no evidence that his work-
related injury caused his polyneuropathy and foot ulceration.
This we cannot do. Instead, our inquiry must focus on whether
there is any evidence in the record to support the trial court’s
finding that Burk’s work-related injury caused his polyneuropathy
and foot ulceration.
Id. at 778 (emphasis added). See also Hunter v. Ford Motor Co., Inc., 305 S.W.3d
202, 207 (Tex. App.—Waco 2009, no pet.) (“In this case Ford did not have the
burden of proof; it was not required to prove there was no defect.”). Observing that
“an expert’s testimony may be contradicted by the testimony of other witnesses or
by cross-examination of the expert witness,” the Burk court concluded,
“Dr. Hershkowitz’s testimony was internally inconsistent” and therefore not
conclusive. Burk, 295 S.W.3d at 779–80.
In this case, at the beginning of trial, the parties and the trial court explicitly
acknowledged “the important thing in this case and what this trial is over is a judicial
–14–
review of a Workers’ Compensation decision.” The Decision was the result of the
three administrative hearings raised by Ace’s counsel during trial. Section 410.304
of the labor code required the trial court to consider the Decision. TEX. LAB. CODE
§ 410.304(b). And, the Decision was part of the trial court’s record.4 The trial court
thus properly considered the Decision before rendering its judgment.
Ace also argues that Dr. Brylowski’s expert report was uncontroverted and
therefore conclusive. However, Elmer did not have the burden of proof, and our
review must focus on whether there is any evidence in the record to support the trial
court’s judgment. Burk, 295 S.W.3d at 778. Moreover, Dr. Brylowski’s expert
reports admitted into evidence in the trial court refer to and/or discuss the reports
and/or findings by Dr. Perish, Dr. Overman, Dr. Pazarella, and/or Ms. Hufnagel,
placing their findings in favor of Elmer squarely before the trial court.5
Dr. Brylowski’s expert report states:
 “There is a neuropsychological diagnostic interview by
Tommy Overman. He opined there is a pain disorder associated
with psychological factors and a general medical condition . . . .”
 “There is a reference to recommendation for psychiatric
referral because Tommy Overman agrees that his depression is
caused by his injury related issues (PDF page 56/96). However,
review of systems states ‘no anxiety and no depression’.
4
“A trial court may take judicial notice of the records in its own court filed in the same case, with or
without the request of a party.” In re K.F., 402 S.W.3d 497, 505 (Tex. App.—Houston [14th Dist.] 2013,
pet. denied). Here, we may presume the trial court took judicial notice of the Decision, which was part of
the record in this case. Id.
5
Dr. Perish, Dr. Overman, Dr. Pazarella, and Ms. Hufnagel are referenced in the “SUMMARY OF
RECORDS” section of Dr. Brylowski’s expert report.
–15–
Examiner comment: Inconsistency not explained. Nonetheless,
there is psychiatry referral.”
 “There is an LPC evaluation that is reviewed. Chronic pain,
depression, and anxiety are opined on Axis I.”
 “There is reference to being referred to pain management
because of ongoing pain complaints by Dr. Zavala. . . . Pain again
is rated at 9/10 by the physical therapist.”
 “After the designated doctor examination, physician at
Concentra shows blood pressure at 152/110. There is reference to
major depressive disorder, status post rotator cuff surgery. There
is reference to awaiting impairment rating and psych referral.”
 “The claimant reports he is up and down all night. He reports
he wakes up sweating. He reports he typically wakes with
stabbing pain in both shoulders. He reports he does snore and his
wife wakes him up. He reports it is not often, primarily when he
is restless. He reports his weight has increased. He is gaining
weight. He eats more when he is depressed an anxious. He reports
that riding his bike helped him but he cannot do that now without
his pain medicines. He reports that biking helps still his mind.”
Dr. Brylowski’s expert report noted the “DESIGNATED DOCTOR EXAMINER
DEFINED INJURY; CONDITIONS; DIAGNOSES” included “Anxiety disorder[,]
Chronic Pain syndrome[, and] Depression.”
In fact, Ace’s counsel himself raised Dr. Panzarella’s findings at trial. For
example, Ace’s attorney stated during trial:
 “The DWC appointed a doctor, he assigned an impairment
rating which was disputed, which is why we’re here in court.”
 “[Elmer] had a knee surgery and shoulder surgery and then
went in January 2015 to a designated doctor from the Division to
get a certified Maximum Medical Improvement and an
impairment rating signed.”
–16–
Moreover—as was the case in Burk—Dr. Brylowski’s expert report was
internally inconsistent. While his expert report stated that his testing showed Elmer
was not overreporting his symptoms and some people with similar testing results
tended to experience anxiety, depression, and withdrawal from every day activities,
it also stated his testing was consistent with overreporting by Elmer which therefore
invalidated a mental and behavioral impairment rating. Dr. Brylowski’s expert
report conceded his testing results on depression and anxiety were “consistent with
multiple possibilities.” It also stated that Elmer’s clinical syndromes “included
anxiety,” “posttraumatic stress,” “thought disorder and major depression,” and
observed:
The F, FB, and FP scores were 102, 107, 64 respectively. In
general, F-scale scores over 65 are seen in people with emotional
turmoil including anxiety and depression, feelings of sadness and
hopelessness and a self-perception of being unable to cope with
the stresses and strains of life.”
Dr. Brylowski’s opinion that although Elmer “has significant degenerative
changes in his knee and bilateral shoulders,” which are “painful conditions,” he has
a zero percent mental and behavioral impairment was contrary to other experts’
findings as described in Dr. Brylowski’s expert report and to Elmer’s trial testimony.
To the extent the trial court was presented with conflicting evidence, it was free to
believe one witness and disbelieve others and resolve conflicts in testimony of any
witness. See McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986).
–17–
In its second issue, Ace argues the trial court erred in finding Elmer’s date of
MMI is June 21, 2016, with an impairment rating of forty-five percent because the
trial court failed to adopt the only valid impairment rating submitted into evidence
as mandated by the labor code. In a judicial review case, the court or jury must adopt
the specific impairment rating of one of the physicians in the underlying
administrative case. See TEX. LAB. CODE § 410.306(c); Ballard v. Arch Ins. Co.,
478 S.W.3d 950, 959 (Tex. App.—Houston [14th Dist.] 2015, no pet.); Bell v. Zurich
Am. Ins. Co., 311 S.W.3d 507, 511 (Tex. App.—Dallas 2009, pet. denied). In other
words, the requirement that the impairment rating match one of the physicians’
findings is part of the substantive statutory scheme. Bell, 311 S.W.3d at 511. Thus,
the fact finder must adopt the specific rating of one of the physicians in the case.
TEX. LAB. CODE § 410.306(c). Evidence of extent of impairment is limited to that
presented to the Division, unless the court makes a threshold finding that the
claimant’s condition has changed substantially, in which case new evidence may be
introduced. Ballard, 478 S.W.3d at 959. Here, the trial court adopted the
impairment rating and opinions of Dr. Panzarella, as expressed in the Decision. For
the reasons stated above, the evidence supports the trial court’s conclusion that the
date of MMI is June 21, 2016, and the impairment rating certified for the entire
injury is forty-five percent.
In the first part of its fourth issue, Ace argues the trial court did not enter a
valid judgment because it was based on facts not in evidence and with “no clear
–18–
rationale or justification.” For the reasons stated above, we conclude the trial court’s
judgment was based on facts in evidence and with clear rationale and justification,
and therefore the judgment was valid.
Viewing the evidence in the light most favorable to the trial court’s verdict,
we conclude there was more than a scintilla of evidence supporting the trial court’s
findings. See City of Keller, 168 S.W.3d at 826–27. We resolve Ace’s first and
second issues, and the first part of Ace’s fourth issue, against it.
Attorney’s Fees
In its third issue, Ace challenges the trial court’s award of attorney’s fees
because Elmer should not have prevailed at trial. Because we affirm the trial court’s
judgment, we need not address this argument. Alternatively, Ace contends Elmer
waived attorney’s fees by not presenting any evidence of fees at trial, by requesting
fees in a post-judgment motion, and by failing to designate an expert on attorney’s
fees during the discovery period; and the trial court erred by awarding attorney’s
fees without holding a hearing and by failing to give Ace notice of the order
awarding attorney’s fees.
Analysis
The Texas Labor Code makes the insurer liable for the claimant’s attorney’s
fees when the insurer seeks judicial review of compensability or eligibility issues
and the claimant prevails. TEX. LAB. CODE § 408.221(c) (“an insurance carrier that
seeks judicial review . . . of a final decision of the appeals panel regarding
–19–
compensability or eligibility for, or the amount of, income or death benefits is liable
for reasonable and necessary attorney’s fees . . . incurred by the claimant . . . if the
claimant prevails on an issue on which judicial review is sought by the insurance
carrier”) (emphasis added); see also Commerce & Indus. Ins. Co. v. Ferguson-
Stewart, 339 S.W.3d 744, 747 (Tex. App.—Houston [1st Dist.] 2011, no pet.)
(“Under section 408.221(c) of the Labor Code, an insurance carrier that seeks
judicial review of an appeals panel decision is liable for a claimant’s reasonable and
necessary attorneys’ fees as a result of the appeal if the claimant prevails on an issue
on which the carrier seeks judicial review.”). In awarding attorney’s fees, the trial
court must consider:
(1) the time and labor required;
(2) the novelty and difficulty of the questions involved;
(3) the skill required to perform the legal services properly;
(4) the fee customarily charged in the locality for similar legal
services;
(5) the amount in controversy;
(6) the benefits to the claimant that the attorney is responsible for
securing; and
(7) the experience and ability of the attorney performing the
services.
TEX. LAB. CODE § 408.221(d).
In his “Original Answer Counter-Claim and Request for Disclosures,” Elmer
pleaded for attorney’s fees, costs of court, and expenses through trial and appeal.
–20–
Elmer did not, however, designate Kay Goggin, his attorney, as an expert witness.
In his trial brief, filed in the trial court on December 17, 2018, Elmer asserted Ace
was liable for his attorney’s fees should he prevail in this case, stating, “If the
claimant prevails in this case, liability for payment of fees is shifted to the Insurance
Carrier. Claimant filed a Counter-Claim for such action.”
The trial court’s January 3, 2019 judgment awarded Elmer unspecified
attorney’s fees and costs of court and stated, “Attorney fees are due and payable to
attorney Kay E. Goggin within 30 days of the finality of this judgment.” On January
11, 2019, Goggin filed an affidavit in the form of a verified motion for statutory
attorney’s fees which:
 swore that the facts stated in the application for attorney’s fees
were correct;
 described reason for and amount of expenses incurred;
 stated she expended 58 hours from June 26, 2017, through
January 11, 2019, on Elmer’s case;
 described with specificity the tasks she performed for Elmer’s
case, and addressed the novelty and difficulty of the questions
involved, the skill required to perform the legal services, and her
qualifications to handle the issues in this case;
 stated her hourly rate is $350, described the fee customarily
charge in Texas for similar legal services, explained with
specificity why her hourly rate was a reasonable fee in Texas and
in Dallas County, described her experience and abilities, and
attached a curriculum vitae; and
 addressed the amount involved in the controversy and the
benefits to Elmer that she secured.
–21–
Goggin’s application requested an attorney’s fee award in the amount of $20,400;
an additional $7,500 in the event Ace unsuccessfully appealed this matter to this
Court; and an additional $7,500 for an appeal to the Texas Supreme Court with an
additional $7,000 for oral argument and “for whatever else” she and Elmer were
“justly entitled.”
Despite that the trial court’s judgment ordered Ace to pay attorney’s fees to
Goggin, Ace did not file response to Goggin’s verified motion for attorney’s fees, a
motion for continuance, or a motion to exclude Goggin on the grounds of surprise,
prejudice or failure to provide underlying data as to attorney’s fees. Nor did Ace
request findings on the amount of fees. On January 15, 2019, before expiration of
its plenary power,6 the trial court awarded Goggin the attorney’s fees requested in
her verified motion “[a]fter consideration of the written evidence of time and
expenses, with support of the factors under Texas Labor Code § 408.221.” On
February 14, 2019, Ace filed a motion to modify the order on attorney’s fees, which
was overruled by operation of law.
Goggin submitted evidence on the issue of statutory attorney’s fees by filing
an affidavit in the form of a verified motion.7 See Bullet Concrete Materials, Inc. v.
TexogaTechs. Corp., No. 09–11–00162–CV, 2012 WL 586676, at *3 (Tex. App.—
6
See TEX. R. CIV. P. 329b.
7
Because this was a bench trial and not a jury trial, Ace was not entitled to have the attorney’s fees
issue determined by a jury.
–22–
Beaumont, Feb. 23, 2012, no pet.) (quoting Cochran v. Wool Growers Cent. Storage
Co., 166 S.W.2d 904, 908 (Tex. 1942)) (generally, “[W]here the testimony of an
interested witness is not contradicted by any other witness, or attendant
circumstances, and the same is clear, direct, and positive, and free from
contradiction, inaccuracies, and circumstances tending to cast suspicion thereon, it
is taken as true, as a matter of law.”). We conclude Ace’s complaint that Elmer did
not submit evidence or expert witness testimony on the issue of attorney’s fees fails.
Ace also complains Goggin was not designated as an expert witness prior to
trial. In this case, the trial court’s consideration of Goggin’s affidavit did not result
in unfair surprise or prejudice to Ace because section 408.221(c) of the labor code
makes the insurer liable for the claimant’s attorney’s fees when the insurer seeks
judicial review of compensability or eligibility issues and the claimant prevails;
Elmer’s pleadings included a request for attorney’s fees from the lawsuit’s inception;
the trial court’s judgment ordered Ace to pay attorney’s fees to Goggin in an
unspecified amount “within 30 days of the finality of this judgment”; Ace did not
object to the trial court’s attorney’s fees award in the judgment or file a motion for
continuance; and Ace did not file a motion to exclude Goggin’s affidavit on
attorney’s fees. See Beard Family P’ship v. Commercial Indem. Ins. Co. 116 S.W.3d
839, 850 (Tex. App.—Austin 2003, no pet.). We conclude Ace waived this issue
for review.
–23–
The final judgment was entered on January 3, 2019. Ace did not object to or
otherwise complain about the inclusion of the fee in the judgment. On January 11,
2019, Goggin’s filed her verified motion for attorney’s fees. Even after the trial
court entered its order on Elmer’s attorney’s fees on January 15, 2019, Ace did not
respond until February 14, 2019. In its motion to modify order on attorney’s fees,
Ace did not complain the fees awarded were not necessary or unreasonable. The
record on appeal does not show Ace presented any evidence rebutting the
reasonableness of the fees. We conclude that under the circumstances of this case,
the trial court did not abuse its discretion by considering Goggin’s affidavit and
ordering Ace to pay attorney’s fees directly to Goggin. See Holland v. Fidelity &
Dep. Co. of Md., 623 S.W.2d 469, 471 (Tex. App.—Corpus Christi 1981, no pet.).
We resolve Ace’s third issue against it.
We affirm the trial court’s judgment.
/Ken Molberg//
KEN MOLBERG
JUSTICE
190386f.p05
–24–
Court of Appeals
Fifth District of Texas at Dallas
JUDGMENT
ACE AMERICAN INSURANCE On Appeal from the 14th Judicial
COMPANY, Appellant District Court, Dallas County, Texas
Trial Court Cause No. DC-17-06888.
No. 05-19-00386-CV V. Opinion delivered by Justice
Molberg. Chief Justice Burns and
CLAYTON D. ELMER, Appellee Justice Carlyle participating.
In accordance with this Court’s opinion of this date, the judgment of the trial
court is AFFIRMED.
It is ORDERED that appellee CLAYTON D. ELMER recover his costs of
this appeal from appellant ACE AMERICAN INSURANCE COMPANY.
Judgment entered this 15th day of September, 2020.
–25–