In a case stemming from a 2019 fire and explosion at ExxonMobil’s Baytown Olefins Plant, the Houston [14th] Court of Appeals has reversed a trial court order denying Exxon’s motion for summary judgment based on the exclusive remedy defense.
ExxonMobil Corporation v. Jon Alvarez, et al.; Carlos Burgoin, et al.; and Efrain Flores-Rodriguez, et al. (No. 14-22-00863-CV; No. 14-22-00872-CV; No. 14-23-00013; February 29, 2024) involved personal injury claims asserted by 23 employees of four subcontractors who worked at the Baytown Plant. Exxon moved for summary judgment, asserting the exclusive-remedy defense under the Texas Workers’ Compensation Act. The trial court denied summary judgment but authorized a permissive appeal, which the court of appeals accepted.
In an opinion by Chief Justice Christopher, the court of appeals reversed and rendered judgment for Exxon. In order to establish the exclusive-remedy defense, Exxon had to show that “(1) the defendant was the plaintiff’s employer within the meaning of the Act, and (2) the defendant subscribed to workers’ compensation insurance” (citation omitted). Though not the direct employer, Exxon asserted statutory employer status by virtue of § 406.123(a), (e), Labor Code, which permits a general contractor to be deemed the employer of a subcontractor’s employees if there is a “written agreement under which the general contractor provides workers’ compensation insurance coverage to the subcontractor and the employees of the subcontractor.” For each of the four subcontractors, Exxon produced a Standard Procurement Agreement (SPA) permitting Exxon to furnish workers’ compensation insurance for the subcontractor’s services performed at the site. Exxon followed up the SPAs with notice to the subcontractors of coverage under Exxon’s OCIP, naming the subcontractors as insureds under the policy.
Plaintiffs, some of whom were represented by Arnold & Itkin and some by Abraham Watkins or other firms, attempted to evade the defense by trying to delink the SPA from the OCIP because they were executed at different times. The court flatly rejected this argument, holding that nothing in the Act “conditions the exclusive-remedy defense on a particular sequence of doumentation,” on that it “requires a written agreement that provides for workers’ compensation insurance coverage.” Plaintiffs further tried to argue that Exxon’s secondary documentation contained discrepancies in contract numbers, which somehow invalidated coverage. The court didn’t fall for this either, holding that even if the contract numbers changed along the way, it wasn’t material to whether coverage existed. Next, Plaintiffs contended that since the SPAs merely gave Exxon the option to provide coverage, they didn’t constitute a written agreement to providecoverage. The court acidly noted that its own precedent had already rejected that argument. There were other arguments as well, such as that the SPA was invalidated by prior mergers between subcontractors or that Exxon hadn’t proved that it paid premiums for the furnished coverage. In short, everything Plaintiffs threw at the wall failed to stick, or even to leave a stain. Indeed, Chief Justice Christopher’s clipped language in the opinion as to the quality of Plaintiffs’ arguments must be read to be appreciated.
We applaud the court for accepting the permissive appeal and doing the trial court’s work for it, but that leaves us wondering why the trial court didn’t simply apply the law in the first place and save the trouble.
