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Worker's Compensation Lifetime Income Benefits Awards

By: Kristin Marker

On August 28, 2015, the Texas Supreme Court issued an opinion in Case No. 13-0814, Dallas National Insurance Company v. Gloria De La Cruz, clarifying the state of Texas law regarding the scope of worker's compensation lifetime income benefits.  See Dallas Nat'l Ins. Co. v. De La Cruz, ___ S.W.3d ___ (2015).

The claimant in this matter was a restaurant worker who fell on the job, injuring her left knee and back. Id. at *1. Her condition continued to deteriorate until she eventually lost total use of both her feet at or above the ankle.  Id. at *1-2. Her knee and back injuries were undeniably compensable under worker's compensation insurance. Id. at *2. However, she requested and was denied an award of lifetime income benefits (LIBs) by the Worker's Compensation Board for her permanent loss of the use of her feet. Id. She appealed the decision to the district court which found her injury resulted in total and permanent loss of her feet and awarded her LIBs. Dallas National Insurance Company appealed the award of LIBs up to the Texas Supreme Court. Id.

The pertinent question in this case is whether worker's compensation LIBs encompass injury to a body part that was not initially injured in the workplace, but allegedly developed as a result of the initial workplace injury.  Texas Labor Code Section 401.011(26) defines injury as "damage or harm to the physical structure of the body and a disease or infection naturally resulting from the damage or harm." Tex. Lab. Code S 401.011(26). Texas Worker's Compensation Act Section 408.161 sets forth seven categories of specific injuries which entitle a claimant to LIBs, one of which is "loss of both feet at or above the ankle," and for the purposes of this section, "the total and permanent loss of use of a body part is the loss of that body part."  Tex. Lab. Code S 408.161(a-b). The court's decision in such proximate injury cases hinges on the causal connection between the initial injury and the eventual injury at the heart of the LIB claim.

The Texas Supreme Court previously took up the issue of LIB awards in worker's compensation for indirect injury in 2011.  See Insurance Company of the State of Pennsylvania v. Carmen Muro, 347 S.W.3d 268 (Tex. 2011). In Muro, the claimant requested an LIB award for indirect injury to her hand and feet caused by a direct workplace injury to the hip, which does not fall into one of the seven enumerated categories of injury under Texas Labor Code section 408.161. Id. at 272. The opinion in Muro, denying the claimant's award of LIBs, narrowly read Tex. Lab. Code S 408.161(a) as limiting awards of LIBs to injury to the specifically enumerated body parts. Id. at 277. As the Muro claimant did not put on sufficient evidence of injury (direct or indirect) to a body part listed in the statute, she was not entitled to an award of LIBs.  Id. Put differently, an injured worker can only recover LIBs under Muro if the injury sustained in the workplace falls under the statutorily defined categories of injury.

De La Garza further narrows the interpretation of the Texas Labor Code section 408.161 outlined in Muro.  In De La Garza, even though the initial injury to claimant's back allegedly caused indirect injury to her feet, which is one of the statutorily enumerated body parts, the medical records and expert testimony did not adequatetly demonstrate sufficient physical and structural damage to the feet to qualify as "total and permanent loss of use" under Texas Labor Code section 408.161. De La Garza at *5. Where the decision in Muro was driven by lack of causation, De La Garza focuses on the degree of injury sustained.  The Supreme Court distinguished Burdine, wherein the employee's work-related back injury directly resulted in nerve root damage that caused the employee's inability to lift her feet.  See id. (discussing Hartford Underwriters Insurance Co. v. Burdine, 34 S.W.3d 700 (Tex. App. -- Fort Worth 2000, no pet.)). The De La Garza claimant failed to demonstrate that she suffered "total and permanent loss of use" of her feet, so unlike the Burdine claimant, she was ultimately denied LIBs. Id.