GAB Business Services, Inc. v. Moore

• Decision Date: 14 April 1992
• Docket Number: No. 6-91-103-CV,6-91-103-CV
• Citation: 829 S.W.2d 345
• Parties: GAB BUSINESS SERVICES, INC., Appellant, v. Sherry MOORE, Appellee.
• Court: Texas Court of Appeals

Page 345

829 S.W.2d 345

GAB BUSINESS SERVICES, INC., Appellant, v. Sherry MOORE, Appellee.

No. 6-91-103-CV.

Court of Appeals of Texas,

Texarkana.

April 14, 1992.

W. David Carter, Barry Bryant, Smith, Stroud, McClerkin, Dunn, Nutter, Texarkana, Ark., for appellant.

Jim Ammerman, II, Marshall, for appellee.

Before CORNELIUS, C.J., and BLEIL and GRANT, JJ.

OPINION

GRANT, Justice.

GAB Business Services appeals from a judgment in favor of Sherry Moore for insurance bad faith and deceptive trade practices.

GAB contends there was insufficient evidence to support the jury's findings that GAB failed to act fairly and in good faith in handling Sherry Moore's workers' compensation claim, that GAB engaged in an unfair or deceptive act or practice, and that Moore suffered out-of-pocket expenses or mental anguish damages. GAB also contends the trial court erred in refusing to submit GAB's requested jury instructions, in denying GAB's motion for instructed verdict based on sovereign immunity and the Texas Tort Claims Act, and in refusing to allow a deposition excerpt into evidence.

GAB is an insurance adjuster specializing in workers' compensation claims. GAB contracted to handle all workers' compensation claims brought against any of the 850 cities that insure themselves through the Texas Municipal League Intergovernmental Risk Pool (the "Risk Pool"). Marshall, Texas, is one of those cities.

On January 20, 1987, Sherry Moore, an employee of the City of Marshall, slipped and fell at work while carrying a bulky container of mail. Moore's injuries required medical treatment and physical therapy. GAB authorized payment of the medical expenses for this treatment and therapy.

Moore continued to work full time, taking an hour every few days for physical therapy. Then, on July 26, 1987, while she was at home putting on a pair of pants, Moore experienced severe lower back pain and had to be taken to Marshall Memorial Hospital. The hospital stay lasted two weeks. By October 6, 1987, Moore had missed over 190 hours of work, and the City of Marshall ceased to pay her.

Moore requested weekly workers' compensation benefits. GAB denied weekly benefits on the theory that Moore's lower back injury was not connected to her on-the-job fall but was caused solely by the strain she incurred while putting on her pants at home. Moore's numerous requests for weekly benefits were unavailing.

The Industrial Accident Board awarded Moore $5,484.63 for her on-the-job injury. Moore appealed, and in July of 1988, a bench trial was held. The judge found that Moore's back problem was a result of her on-the-job injury and that Moore was totally and permanently incapacitated.

In November of 1988, Moore filed this suit, alleging that the City of Marshall, the Risk Pool, and GAB failed to act in good faith and violated portions of the Insurance Code and the Deceptive Trade Practices Act in handling her claim. A jury trial was held, and the jury found in favor of Moore. The trial court granted the City's and the Risk Pool's motion for judgment non obstante veredicto, finding no evidence that those defendants violated their duty of good faith, and entered judgment only against GAB for $25,000 in actual damages, $75,000 in exemplary damages, and forty percent attorney's fees. GAB appeals from that judgment.

GAB first contends that there was insufficient evidence to support the jury's finding that GAB failed to act fairly and in good faith in providing Moore weekly workers' compensation benefits. When considering an insufficiency of the evidence point, this Court must consider and weigh all of the evidence and should set aside the verdict only if it is so contrary to the overwhelming weight of the evidence as to be clearly wrong. Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986).

Workers' compensation carriers have a duty to deal fairly and in good faith with injured employees. Aranda v. Insurance Co. of North America, 748 S.W.2d 210, 212-13 (Tex.1988). A claimant who asserts that a carrier has breached its duty of good faith and fair dealing must establish (1) the absence of a reasonable basis for denying or delaying payment of the claim, and (2) that the carrier knew or should have known that there was no reasonable basis for denying or delaying payment of the claim. Aranda, 748 S.W.2d at 213.

Patricia Strobel, the GAB employee who handled the case, testified that the medical reports in GAB's file indicated that Moore's on-the-job accident had injured her shoulder, elbow, and wrist. Strobel and her supervisor, Mike Bratcher, both testified that GAB was willing to pay any expenses related to Moore's shoulder, elbow, and wrist. But they took the position that Moore's back problem was caused by a separate, intervening accident which happened at home and therefore was not compensable.

The initial report of injury filed by the City, however, indicated that Moore suffered injury to her left shoulder, left leg, and the left side of her back. Moreover, GAB had medical reports indicating that Moore was having back problems in the Spring of 1987, after her on-the-job injury but before the alleged intervening incident on July 26, 1987. GAB had a hospital report dated March 26, 1987 indicating that Dr. Douglas Duncan had ordered a CT-scan of Moore's lumbar spine. GAB also had a report from Dr. David Adams dated March 26, 1987, stating, "This 38-year-old lady gives a history of falling at work two months ago injuring her left upper extremity and low back. She complains of paresthesia of her left hand with frequent nocturnal hand pain. She also complains of severe low back pain radiating into the left lower extremity." (Emphasis added.) GAB had a medical history from Dr. Jorge Martinez indicating that Moore's back had been injured by the January fall.

GAB filed a statement of controversion on October 30, 1987, listing its reasons for denying the claim. According to the statement, GAB's investigation did not indicate that Moore's disability was due to her January injury.

On November 12, Dr. Bob Herrin, who had been treating Moore's back, wrote GAB stating, "It is my opinion that Mrs. Moore's problems with her back originated on January 20, 1987, as a result of her fall." A few days later, GAB was forwarded a report from the physical therapy department of Marshall Memorial Hospital indicating that the therapy Dr. Duncan had prescribed in March included therapy to the left arm, shoulder, neck, and lower back. GAB also received an employer's supplemental injury report indicating that, as of October 6, 1987, Moore was off the job as a result of her January injury.

Despite this additional documentation, GAB refused to reconsider its statement of controversion and would not begin weekly benefits. Ken Hargrove, who had worked as a claims adjuster for twenty years, testified that he would have started benefits in this situation and that GAB unreasonably delayed payment.

Two witnesses testified that Sherry Moore's husband, William Moore, told them that Moore's back pain was due to her putting on her pants at home. There was testimony, however, that it is not uncommon for a person to incur an injury and then later, while performing some ordinary task, feel the effects of that injury.

There was sufficient evidence for the jury to find that there was no reasonable basis to deny Moore's claim and that GAB knew or should have known that there was no reasonable basis to deny the claim. The point of error is overruled.

GAB next contends there was insufficient evidence to support the jury's finding that GAB engaged in any unfair or deceptive act or practice. An insurer's lack of good faith in processing a claim is an unfair or deceptive act and can be the basis of a cause of action under the Deceptive Trade Practices Act, TEX.BUS. & COM.CODE ANN. § 17.41, et seq. (Vernon 1987 & Supp.1992). Vail v. Texas Farm Bureau Mut. Ins. Co., 754 S.W.2d 129, 135 (Tex.1988); Allied General Agency, Inc. v. Moody, 788 S.W.2d 601, 604 (Tex.App.--Dallas 1990, writ denied).

The evidence shows that even after GAB received medical reports indicating that Moore's back injury was caused by her on-the-job fall, GAB refused to reconsider its position, offer a reasonable settlement amount, or begin weekly benefit payments. There was sufficient evidence for the jury to find that GAB engaged in an unfair or deceptive act or practice. The point is overruled.

GAB next urges that the trial court erred in refusing to submit GAB's requested jury instructions. When a requested instruction is submitted in writing and the trial judge refuses it, the judge shall write "refused" on it and sign or initial it. Such an endorsed, refused instruction serves as a bill of exceptions. TEX.R.CIV.P. 276. Nowhere in the record is there a sheet so marked and endorsed, nor is there a formal bill of exceptions. We therefore conclude that GAB did not comply with Rule 276 and did not preserve error. Templeton v. Unigard Sec. Ins. Co., 550 S.W.2d 267, 269 (Tex.1976); Moffett v. Goodyear Tire & Rubber Co., 652 S.W.2d 609, 612 (Tex.App.--Austin 1983, writ ref'd n.r.e.); Breithaupt v. Navarro County, 675 S.W.2d 335, 339 (Tex.App.--Waco 1984, writ ref'd n.r.e.).

GAB next contends that there was insufficient evidence to support the jury's finding that Moore suffered any out-of- pocket...