IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_____________________
No. 99-51002
_____________________
B. J. HALL,
Plaintiff-Appellant,
versus
WHITE, GETGEY, MEYER & CO., LPA,
Defendant-Appellee.
_________________________________________________________________
Appeal from the United States District Court for the
Western District of Texas, San Antonio
USDC No. SA-97-CV-320
_________________________________________________________________
February 20, 2001
Before JOLLY, JONES, and SMITH, Circuit Judges.
E. GRADY JOLLY, Circuit Judge:*
In this legal malpractice case, B. J. Hall contends that the
law firm of White, Getgey, Meyer & Co., LPA (“White/Getgey”)
negligently represented him in a suit in which Hall sought
disability benefits from an insurance company. Hall alleges that
the firm’s failure to supplement interrogatory answers led to the
exclusion of Hall’s medical expert witnesses at trial. In this
ensuing legal malpractice suit, the magistrate judge granted
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
White/Getgey’s motion for summary judgment and dismissed Hall’s
complaint because she concluded that the underlying lawsuit was
without merit and, consequently, that White/Getgey’s negligence
could not have been the proximate cause of Hall’s failure to
collect under the insurance policy. Specifically, the magistrate
judge found that Hall could not have recovered on the disability
insurance policy because he had presented no evidence that he was
“totally disabled” during the time that he was covered by the
policy. Hall argues that he had presented sufficient evidence of
his disability to withstand summary judgment. We agree. We
therefore reverse the magistrate judge’s order and remand the case
for further proceedings.
I
B. J. Hall was the executive vice president and chief
operating officer of Incarnate Word Health Services from July 5,
1989 to May 18, 1990. The magistrate judge found that Hall’s
duties as Incarnate Word’s vice-president included developing long-
term plans and preparing reports, coordinating programs and
services within Incarnate Word’s multi-hospital system, attending
all corporate board meetings, and attending “key meetings,
institutes, etc., on local, state, and national levels to keep
abreast of various trends” in the health care industry. The
record indicates that Hall’s position required him to travel often
and to work up to ten to twelve hours a day.
2
As an employee of Incarnate Word, Hall was covered by a group
disability policy issued by Hartford Life & Accident Insurance
Company. Under this policy, Hall was eligible for benefits if he
became “totally disabled” while employed at Incarnate Word. The
policy defines “totally disabled” as being “prevented by disability
from doing all the material and substantial duties of your own
occupation.” “Disability” includes accident, bodily injury, and
sickness. The term “occupation” is not defined in the policy.
Hall suffered from a pre-existing condition: He had contracted
polio as a child and suffered from “post-polio syndrome.” There is
undisputed medical testimony that Hall never fully recovered from
his childhood bout with polio, that his level of physical
performance ranged from 25% to 40%, and that his physical
performance was gradually deteriorating as he aged.
On May 7, 1990, Hall was involved in an automobile accident.
As a result, he suffered whiplash, numbness in his extremities,
loss of balance, and fatigue. After the accident, Hall attended
one staff meeting but did not otherwise return to work. On May 11,
1990, Incarnate Word notified Hall that his employment would be
terminated effective May 18, 1990.
After losing his job at Incarnate Word, Hall searched
unsuccessfully for hospital management positions that required less
travel and physical exertion. He worked for one month for a job
placement agency before resigning for health reasons.
3
During l990 and 1991, Hall consulted two physicians, Dr. Grimm
and Dr. Vallbona, both of whom “suggested” (as the magistrate judge
put it) that Hall had become totally disabled on May 7, 1990, as a
result of the automobile accident. In April 1991, Hall submitted
a claim for disability benefits under the Hartford policy.
The insurance company denied his claim. Hall then retained an
attorney to represent him against Hartford. In early 1995, just a
few months before the trial date, Hall changed attorneys and
substituted the White/Getgey firm.1 Unfortunately, White/Getgey
failed to supplement their responses to interrogatories concerning
the identity of medical expert witnesses who would testify at
trial, and as a result, Hall’s expert witnesses were excluded.
Without medical experts, Hall had no possibility of winning his
case and settled with Hartford for a nominal amount.
II
Thus, we come to this legal malpractice suit, which Hall has
filed against White/Getgey, alleging the firm’s failure to
supplement its responses to interrogatories. To prevail, Hall must
prove by a preponderance of the evidence that, but for the
negligence of his attorneys, he would have recovered damages from
Hartford on the disability insurance claim. See, e.g., Mackie v.
McKenzie, 900 S.W.2d 445, 448-49 (Tex.App.–Texarkana 1995).
1
At the time, an attorney from the White/Getgey firm estimated
that Hall’s suit had a settlement value of $300,000 to $500,000.
4
The case involves a procedural snag or two. The defendant,
White/Getgey, an Ohio-based law firm, removed the case to federal
court based on diversity jurisdiction. The case was assigned to
the United States District Court for the Western District of Texas,
which denied the firm’s first motion for summary judgment. The
parties then consented to magistrate jurisdiction pursuant to 28
U.S.C. § 636(c): “Upon the consent of the parties, . . . [a
magistrate] may conduct any or all proceedings in a jury or nonjury
civil matter and order the entry of judgment in the case, when
specially designated to exercise such jurisdiction by the district
court or courts he serves.” The district judge randomly assigned
the case to a magistrate judge. White/Getgey then filed a second
motion for summary judgment. Although the second motion was
substantially the same motion that the district judge had denied,
the magistrate judge concluded that she was not bound by the
district judge’s denial of the first motion. On September 13,
1999, the magistrate judge issued an order granting White/Getgey’s
motion for summary judgment and dismissing Hall’s claims. The
magistrate judge concluded that Hall had “failed to submit evidence
creating a fact issue” that he was “totally disabled,” as defined
by the policy, prior to May 18, 1990. Because Hall had failed to
create a fact issue regarding the merit of his underlying lawsuit,
he thus could not show that White/Getgey’s negligence was the
proximate cause of his failure to collect under the Hartford
disability policy.
5
III
Hall raises two issues on appeal. The first issue concerns
the scope of a magistrate judge’s authority under 28 U.S.C.
§ 636(c). The second issue concerns the sufficiency of Hall’s
summary judgment evidence on the question whether, prior to the
termination of his employment with Incarnate Word, he was “totally
disabled” within the meaning of his insurance policy. Both
questions are reviewed de novo. See generally CHILDRESS & DAVIS,
FEDERAL STANDARDS OF REVIEW § 2.13 (3d ed. 1999) (“purely legal”
conclusions, such as the meaning of a statute conferring
jurisdiction, are reviewed de novo); Horton v. City of Houston, 179
F.3d 188, 191 (5th Cir. 1999) (explaining that this court reviews
a district court’s grant of summary judgment de novo, applying the
same substantive test set forth in Federal Rule of Civil Procedure
56).
A
Hall contends that under 28 U.S.C. § 636(c), a magistrate
judge does not have the authority to grant a motion for summary
judgment if a district judge has already denied a substantially
equivalent motion. We conclude that this argument, that the
magistrate judge improperly “overruled” the district judge’s prior
order, is without merit. As we have stated before,
when (1) both parties consent to the jurisdiction of the
magistrate judge and (2) the district judge specifically
designates the magistrate judge to conduct civil
proceedings, the magistrate judge "may act in the
6
capacity of a district court judge" and is not bound by
prior opinions expressed by the district judge.
Cooper v. Brookshire, 70 F.3d 377, 378 n.6 (5th Cir. 1995);
see also W RIGHT, MILLER, & MARCUS, FEDERAL PRACTICE AND PROCEDURE: CIVIL 2D
§ 3072.
B
We now turn to the second issue: whether the magistrate judge
erred in granting White/Getgey’s motion for summary judgment.
(1)
In its second motion for summary judgment, White/Getgey argued
that Hall had not presented evidence that, on or before May 18,
1990, he had been prevented by injury and sickness from performing
all the material duties of his occupation. The firm focused on
Hall’s behavior following his automobile accident. The firm noted
that Hall could have performed at least some of his duties, that he
continued to seek employment after May 1990, and that he did not
file for disability benefits until April 1991. Hall could not have
been totally disabled, the firm seems to argue, because Hall did
not consider himself totally disabled in May 1990, the point at
which his relationship to Incarnate Word was severed.
In the magistrate judge’s opinion and order granting the
motion for summary judgment, the magistrate judge relied on two
arguments that had not been advanced before. First, she stated
that Hall had not produced necessary evidence of his occupational
duties. Her explanation is as follows:
7
To establish a fact issue that he should have prevailed
in the underlying lawsuit and was totally disabled under
the terms of the policy, plaintiff must produce evidence
that he was “prevented by disability from doing all the
material and substantial duties of [his] occupation.”
Plaintiff has failed to introduce any evidence relating
to his occupation and what the material and substantial
duties actually were. Instead, he produced the job
requirements for his specific position as the Executive
Vice President and Chief Operating Officer of Incarnate
Word Health Services. However, nowhere in the record
does plaintiff discuss his occupation generally.
Second, the magistrate judge concluded that Hall’s medical
expert testimony was “not sufficient to even establish that [he]
was disabled for his position at Incarnate Word, much less his
occupation, because there is no evidence that Dr. Grimm was aware
of plaintiff’s job responsibilities.”
In sum, these are the three principal arguments supporting
summary judgment for White/Getgey: Hall’s behavior after the
accident, the lack of evidence regarding his general occupation,
and the insufficiency of the medical testimony. For the reasons
set forth below, we do not find any of these arguments persuasive.
(2)
As the magistrate judge recognized, however, before we may
address any of these arguments, we must ascertain the meaning of
several terms in the insurance policy. We begin with the meaning
of “occupation,” a term not defined in the Hartford policy.
The magistrate judge’s order granting summary judgment for
White/Getgey is predicated on a sharp distinction between Hall’s
general “occupation” and his “specific position” at Incarnate Word.
8
We find this distinction problematic here because the court’s order
cites no language from the Hartford policy and no relevant legal
authority that would support the distinction between Hall’s
occupation and the particular position that he occupied when the
policy was in force.2 And in the course of this appeal, neither
White/Getgey nor this court has uncovered any precedent supporting
the distinction. We can only assume, then, that the district court
applied the accepted rules of contract interpretation and
construction and found the meaning of the term “occupation” to be
unambiguous.
Whether a contract term is ambiguous is a question of law that
appellate courts review de novo. See National Union Fire Ins. Co.
v. CBI Industries, Inc., 907 S.W.2d 517, 520 (Tex. 1995). When
deciding whether a contract term is ambiguous, a court is not
confined to the four corners of the instrument: “Evidence of
surrounding circumstances may be consulted . . . . to determine
whether or not the contract is ambiguous.” Sun Oil v. Madeley, 626
S.W.2d 726, 731 (Tex. 1981).3 These “surrounding circumstances”
2
Because White/Getgey had not raised this argument in its
motion for summary judgment, the precise meaning of “occupation”
had not been argued by the parties in the district court.
3
See also Columbia Gas Transmission Corp. v. New Ulm Gas,
Ltd., 940 S.W.2d 587, 591 (Tex. 1996); City of Pinehurst v. Spooner
Addition Water Co., 432 S.W.2d 515, 518 (Tex. 1968)(“Where a
question relating to the construction of a contract is presented,
. . . we are to take the wording of the instrument, considering the
same in the light of the surrounding circumstances, and apply the
pertinent rules of construction thereto and thus settle the meaning
of the contract.”)(emphasis added). Thus, the general rule is that
9
include trade usage and the course of the parties’ performance of
the contract.4
In this case, the most compelling evidence of “surrounding
circumstances” is the Hartford insurance company’s claim form,
which both parties submitted as an exhibit. The claim form
includes sections to be filled out by the employer, the employee,
and the employee’s physician. Both Incarnate Word and Hall listed
his “occupation” as “Executive Vice-President.” More importantly,
one part of the claim form instructs the employer to “Describe
exact duties of Employee’s Occupation or attach copy of job
description.” Incarnate Word complied by attaching a document
entitled “position analysis” that listed Hall’s duties as the
company’s executive vice-president.5 From a review of the claim
form, we believe it is clear that Hall, Incarnate Word, and
Hartford all treated Hall’s “occupation” and his “specific
position” at Incarnate Word as interchangeable or synonymous terms.
This is the meaning that we must assign to “occupation,” inasmuch
a court “may (1) hear and consider evidence of the circumstances
surrounding the formation and execution of the contract and (2)
apply the rules of construction whenever the parties disagree as to
the proper construction of a writing. Neither a pleading nor a
finding of ambiguity is required.” Mark K. Glasser & Keith A.
Rowley, On Parol: The Construction and Interpretation of Written
Agreements and the Role of Extrinsic Evidence in Contract
Litigation, 49 BAYLOR L. REV. 657, 701 (1997).
4
See Glasser & Rowley, 49 BAYLOR L. REV. at 667.
5
Incidentally, the magistrate judge relied on this “position
analysis” in her description of Hall’s job duties.
10
as the court’s duty is to give effect to the intent of the
contracting parties. See Lenape Resources Corp. v. Tennessee Gas
Pipeline Co., 925 S.W.2d 565, 574 (Tex. 1996).
Considering the circumstances surrounding the formation and
execution of this insurance contract, we conclude that there is
only one reasonable interpretation of the term “occupation.” Thus,
Hall’s evidence of his duties as executive vice-president of
Incarnate Word is sufficient evidence of his occupation, as that
term is used in the insurance policy.
(3)
We now turn to the meaning of “totally disabled,” another
disputed contract term. As noted above, Hall could recover on the
Hartford policy only if he had suffered a “total disability,” that
is, if he had been “prevented by disability from doing all the
material and substantial duties of [his] own occupation.”
The magistrate judge found that Hall’s duties at Incarnate
Word required him to develop plans, prepare reports, and coordinate
programs and services within the company’s multi-hospital system,
and to attend corporate board meetings and conferences in order to
“keep abreast of various trends” in the health care industry. At
least some of these duties required Hall to travel extensively and
work long hours. The scope and nature of Hall’s duties at
Incarnate Word are not in dispute.
The parties do disagree, however, on the meaning of the phrase
“all the material and substantial duties.” Hall argues that he is
11
totally disabled because he was unable to perform “every aspect of
[his] principal work” as Incarnate Word’s vice-president.
White/Getgey argues that Hall was not “totally disabled” because he
could still “perform some of his duties as an executive vice-
president.”
We have considered the arguments of both parties and have
reviewed all the disability clauses in the insurance policy.
However, we have been unable to determine the precise meaning of
the disputed phrase. We therefore conclude that the phrase “all
the material and substantial duties” is ambiguous in the sense that
it is “reasonably susceptible” to either of the proposed
interpretations. Harris v. Rowe, 593 S.W.2d 303, 306 (Tex. 1979).
In a typical contract case, ambiguity creates a fact question
as to the parties’ intent. See Lenape Resources, 925 S.W.2d at
574. Here, however, the parties have offered no evidence that
creates a dispute of fact on this question. And, more importantly,
in the specific context of insurance contract cases, Texas courts
resolve ambiguities against the carrier and in favor of the
insured.6 See State Farm Fire & Cas. Co. v. Reed, 873 S.W.2d 698,
701 (Tex. 1993) (“Based upon an examination of the text . . . and
considering other possible reasonable interpretations, we conclude
6
This rule governing insurance contracts is a more specific
application of the rule contra proferentem: Under Texas law, “a
writing is generally construed most strictly against its author.”
Addison Bank v. Temple-Eastex, Inc., 672 S.W.2d 793, 798 (Tex.
1984).
12
that the provision is ambiguous. Therefore, strictly construing
the policy language against the insurer and adopting the
interpretation most favorable to the insured, we hold that coverage
exists under the policy. . . .”). Thus, if both the insurer and
the insured offer reasonable interpretations of an ambiguous term
in the policy, we resolve the ambiguity in favor of the insured.
See Barnett v. Aetna Life Ins. Co., 723 S.W.2d 663, 666 (Tex.
1987).
In the light of this presumption in favor of coverage, Hall’s
interpretation of “all the material and substantial duties” must be
favored. Therefore, under this policy, an employee such as Hall is
deemed “totally disabled” if he is unable to perform the entire set
of his material duties.
(4)
The next step is to determine whether, in order to survive
summary judgment, Hall presented sufficient medical testimony of
total disability at the time he left Incarnate Word in May 1990.
In 1990 and 1991, Hall was examined by two physicians: Dr.
Grimm, a neurologist; and Dr. Vallbona, a specialist in post-polio
syndrome. In their depositions, both doctors described Hall’s
physical condition and his deterioration after the May 1990
accident. And, as the magistrate judge correctly observed, both
doctors concluded that Hall probably became disabled on May 7,
1990, as a result of the automobile accident that aggravated the
symptoms of his post-polio syndrome. Dr. Grimm stated in his
13
deposition that Hall’s “motor vehicle accident added enough to his
difficulties that [it] really disabled him for the kind of work
that he was doing.” Dr. Vallbona declined to set the date of
disability with certainty, but he said that “May 1990 may have been
the date when I would consider him likely to have become
permanently disabled.”
The magistrate judge found the expert medical testimony
unsatisfactory for the sole reason that neither physician was fully
aware of Hall’s occupational duties. Consequently, neither
physician could definitively say that Hall was “totally disabled”
within the meaning of the insurance policy. However, we see no
reason to disregard the medical testimony merely because the
physicians had not been made fully aware of Hall’s specific duties
at Incarnate Word. The ultimate issue, of course, is whether
Hall’s medical condition on May 18, 1990, prevented him from
performing all the material duties of his occupation. And while
Federal Rule of Evidence 704 permits the medical expert to offer
his opinion on the ultimate issue, Rule 704 does not require the
expert to do so. As long as (a) the physicians testify to Hall’s
medical condition in May 1990 (including their estimation of Hall’s
capacity to work long hours and to travel), and (b) Hall presents
evidence of his occupational duties at Incarnate Word, the trier of
fact may determine the ultimate issue.
(5)
14
Our final consideration is White/Getgey’s principal argument
that Hall’s behavior after the May 1990 accident proves that he was
not totally disabled during the relevant time period. White/Getgey
points to the facts that Hall traveled during the summer of 1990
and even took a family vacation to Europe, that Hall continued to
search for similar employment, and that Hall did not believe he was
totally disabled until sometime in 1991. These facts are indeed
relevant to the question of Hall’s disability, and the trier of
fact will need to weigh this evidence against the testimony of Hall
and his medical expert witnesses. Even so, this evidence of Hall’s
subsequent behavior is clearly insufficient to warrant summary
judgment for White/Getgey under Rule 56 of the Federal Rules of
Civil Procedure.
IV
Considering all of the evidence in the record, a jury
reasonably could conclude, first, that Hall’s duties at Incarnate
Word Health Services (such as attending national conferences and
coordinating activities in a multi-hospital system) demanded a high
tolerance for stress, long and uninterrupted working hours, and
considerable travel; and, second, that after his May 1990
automobile accident that aggravated his post-polio syndrome, Hall
was no longer capable of performing those occupational duties.
We conclude that the magistrate judge erred in concluding that
the underlying lawsuit is without merit. The summary judgment for
15
White/Getgey is therefore REVERSED, and the case is REMANDED for
proceedings not inconsistent with this opinion.
REVERSED and REMANDED.
16