The Eastland Court of Appeals has reversed a judgment against a workers’ compensation carrier for bad faith and DTPA violations arising out of a dispute over the terms of a comprehensive settlement agreement (CSA) executed under the pre-1989 workers’ compensation statute.
The circumstances surrounding Sentry Insurance, A Mutual Company v. Donald Bristow (No. 11-23-00016-CV; July 24, 2025) are unfortunate. Donald Bristow was permanently paralyzed in a motor vehicle accident while employed by Nunn Manufacturing Company, who carried worker’s compensation insurance through Sentry. The accident occurred in 1993, and for the next several years, Mr. Bristow received supplemental income payments, medical benefits, and $3,650 a month for home health care.
In 2018, Sentry filed suit in Nolan County to terminate home health care services, alleging that Bristow no longer needed them. It also filed a motion to abate these payments, alleging that “overpayments” should be withheld until future home health care expenses balanced them out. The trial court denied this motion and awarded attorney fees to Bristow. Bristow sought relief from the Texas Division of Workers Compensation (DWC) regarding Sentry’s efforts to abstain from payments, but the Division declined to intervene. Bristow then filed a counterclaim in 2020, asserting that: 1) Sentry improperly allocated attorney fees to Bettie Francis, a non-attorney and widow of Bristow’s former attorney; 2) Sentry had delayed and failed to pay medical bills associated with ulcers Bristow had developed; and 3) Sentry wrongfully attempted to avoid payments for his home health care as stipulated by the CSA. Additionally, he alleged Sentry had acted in bad faith, violating the Texas Insurance Code.
Sentry filed a plea to the jurisdiction, arguing that DWC had exclusive jurisdiction over the matter, which the trial court denied. Sentry sought mandamus, claiming that under the CSA Sentry was not required to pay for these expenses, and that enforcement of the monthly payments should cease. The court of appeals conditionally granted relief on the basis that Bristow failed to exhaust administrative remedies with respect to his claims for unpaid medical expenses. Those claims were remanded back to trial courtand dismissed. However, the court denied relief for in connection with Bristow’s claims arising out of the enforcement of monthly payments. Sentry commenced an administrative proceeding in the DWC, seeking a determination that it was entitled to a credit or offset in connection with its previous payments under the CSA. DWC rejected the claim and issued an award in favor of Bristow.
Sentry appealed in Randall County, where Bristow now lived, which abated the matter in deference to the action which was still pending in Nolan County. Sentry sought mandamus relief from the Amarillo Court of Appeals to compel the trial court in Randall County to vacate its order to abate. The court denied relief, concluding that the court in Nolan County had dominant jurisdiction. While this was going on, Bristow filed an amended answer and counterclaim in Nolan County, reasserting the claims that had been dismissed as a result of Sentry’s first mandamus petition. Once again Sentry sought mandamus relief from the Eastland court seeking dismissal of claims arising out of Sentry’s failure to pay medical benefits. As it did the first time, the court granted relief. Not yet satisfied, Sentry filed a fourth mandamus request, asking the court of appeals to compel the trial court to render partial summary judgment in its favor. Sentry contended that Russel Bowman, Sentry’s attorney, was at risk of becoming a material witness and would therefore have to withdraw from representation of Sentry prior to trial.
The court denied mandamus, and the case proceeded to trial. The jury reached a verdict against Sentry, finding that it had intentionally violated the Texas Insurance Code and the DTPA. The jury awarded Bristow $250,000 in mental anguish and $500,000 in statutory damages, plus $75,950 for attorney fees. Sentry appealed.
In an opinion by Chief Justice Bailey, the court of appeals affirmed in part and reversed and rendered in part. Sentry claimed in this appeal that the trial court lacked subject matter jurisdiction over Bristow’s claims, Bristow’s claims were barred by SCOTX’s holding in Texas Mutual Insurance Company v. Ruttiger, 381 S.W.3d 430 (Tex. 2012). The trial court failed to find that Sentry engaged in an “extreme act” that led to an independent injury, the trial court erred in awarding Bristow attorney’s fees, and the trial court erred in failing to submit Sentry’s requested question to the jury.
As to subject matter jurisdiction, the court reiterated its holdings in the previous mandamus cases, in which the court distinguished between claims arising out of Sentry’s alleged failure to pay medical benefits and those arising out of monthly payments due under the CSA. In those cases, the court determined that the trial court did not have jurisdiction over the first category because Bristow did not exhaust administrative remedies. The trial court duly dismissed those claims, and Bristow did not reassert them or attempt to introduce evidence of unpaid medical benefits during trial. Sentry’s complaint as to failure to pay benefits thus had no basis. Regarding the second category, the court previously determined that the trial court had jurisdiction because the DWC didn’t have statutory authority to rescind or set aside a CSA that had been approved under the workers’ compensation law as it existed in 1993. The court further observed that in 2019, when Bristow requested a prehearing conference relating to claims under the CSA, the DWC issued an opinion letter stating that any dispute as to home health care must be submitted to a court under the terms of the CSA. The trial court thus had jurisdiction over the CSA-related claims.
Turning to Ruttiger, the court observed that Bristow’s case, which arose in 1993, was governed by the pre-Ruttiger regime. Recounting the history prior to Ruttiger, the court noted SCOTX’s opinion in Aranda v. Insurance Company of North America, 748 S.W.2d 210 (Tex. 1988), which recognized “a duty on the part of workers’ compensation carriers to deal fairly and in good faith with injured employees in the processing of compensation claims.” Injured employees could also assert claims against carriers for Insurance Code and DTPA violations, including claims arising out of a carrier’s obligations under the parties’ settlement agreement. Aetna Casualty & Surety Company v. Marshall, 724 S.W.2d 770 (Tex. 1987)
Along came the 1989 workers’ compensation reforms, which substantially changed the landscape and set the stage for Ruttiger. In that case SCOTX held that the 1989 statute precluded an injured employee from bringing actions for unfair settlement practices under § 541.060, Insurance Code, and for breach of duty of good faith and fair dealing. Shortly after deciding Ruttiger, SCOTX held that an injured employee could not pursue a DTPA claim based on the carrier’s claims handling practices, either. In re Crawford & Company, 458 S.W.3d 920 (Tex. 2015). Based on this precedent (which applied to Sentry’s alleged conduct in 2018, although the CSA was entered into at an earlier date), the court sustained Sentry’s second issue because the trial court improperly charged the jury with questions regarding Sentry’s bad faith. This holding allowed the court to dispense with Sentry’s third and fifth issues as well.
In Sentry’s fourth issue, which challenged the trial court’s decision to order Sentry to pay Bristow’s attorney fees, the court observed that § 38.001, CPRC, states that a person may recover attorney fees in addition to the amount of a valid claim and costs if the claim is for an oral or written contract. Here Bristow defeated Sentry’s jurisdictional claim, but did not prosecute his own breach of contract claim. Consequently, the court ruled that he was not entitled to attorney fees. The trial court’s decision was reversed and the appellate court rendered a take nothing judgment in connection with Bristow’s claims. Additionally, the court reversed the trial court’s award of attorney’s fees to Bristow. Otherwise the judgment of the trial court was affirmed.
This case should remind us all that the 1989 workers’ compensation reforms were probably the most important achievement of the civil justice reform era in Texas. If the effort had failed, there would be no workers’ compensation system in Texas at all (at least none that any business could afford). All workplace injury cases would look a lot like this one, with juries deciding not only common-law and statutory damages but levels of benefits as well. In particular, this case demonstrates why recent legislative efforts to reintroduce compromise settlement agreements are fundamentally misguided and would eventually undermine the system put in place in 1989. Here Plaintiff attempted to re-litigate the terms of a CSA entered into under the old law by way of bad faith and DTPA claims. That’s precisely what would happen over and over again if we let CSAs back into the system. We can’t let that happen, and we applaud the Eastland Court of Appeals for its deliberate, thorough, and scholarly analysis of that issue in this case.
TCJL Intern Satchel Williams researched and prepared the first draft of this article.
