Untitled Texas Attorney General Opinion

July 25, 1988
JIM MATTOX
ATMRNEY O&NERAL

Mr. Joseph C. Gagen Opinion No. JM-931
Chairman
Texas Industrial Accident Re: Authority of the Industrial
Board Accident Board to approve a
200 East Riverside settlement agreement that would
Austin, Texas 78704 terminate liability for future
medical expenses (RQ-1353)

Dear Mr. Gagen:

You ask:

Does the authority of the Industrial
Accident Board over medical expenses incurred
after a final award, judgment, or settlement,
extend to approving compromise settlement
agreements that would terminate all liability
for future medical expenses?

The Industrial Accident Board (the "board") is an adminis-
trative body created by statute and possessing only those
powers conferred on it by statute. mmercial Casualty
Insurance 87 'S.W.2d ::81 (Tex. 1935).
V.T.C.S. artf)'8:;7, § 1.'

We believe that the determination of the board's
authority to approve a compromise settlement agreement
subsequent to a final award of the board or a judgment of a
court is governed by different statutory provisions than
those apposite to the determination of the board's authority
to approve compromise settlement agreements subsequent to an
original compromise settlement agreement. We will therefore
treat these two elements of your question separately.

AUTHORITY OF BOARD TO APPROVE COMPROMISE
SETTLEMENT AGREEMENT REGARDING FUTURE MEDICAL
EXPENSES SUBSEQUENT TO FINAL AWARD OF BOARD
OR JUDGMENT OF COURT.

Attorney General Opinion JM-361 (1985) dealt with the
question of whether the board may approve, while a case is

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Mr. Joseph C. Gagen - Page 2 (JM-931)

--.

pending before the board, a compromise settlement agreement
which terminates liability for future medical expenses, if
the carrier had admitted liability and the injury was one
conclusively held to be total and permanent pursuant to
article 8306, section lla, V.T.C.S.

Noting that section 12 'of article 8307, V.T.C.S.,
authorized the board to approve a compromise settlement
agreement ll[w]here the liability of the association or the
extent of the injury is uncertain," JM-361 concluded that
where the carrier had admitted liability and where the
injury was one for which as a matter of law incapacity was
total and permanent, there was no Wncertaintyl@ as to
liability or extent of injury within the meaning of section
12. The opinion ruled that uncertainty as to amounts of
future medical expenses was not "uncertainty" within the
meaning of section 12 such that the board would be
authorized to approve a compromise settlement agreement
regarding only future medical expenses, where liability and
extent of injury had been established.

In our opinion, it follows from the ruling in JM-361
that the board has no authority to approve a compromise
settlement agreement that would terminate liability for
future medical expenses after a final award of the board or
a judgment of a court, because the proceedings of the board
or a court in rendering a final award or judgment would
necessarily have determined "liabilityql and "extent of
injury" such that there would be no remaining "uncertainty"
within the meaning of section 12 which would authorize the
board to approve a compromise settlement agreement regarding
future medical expenses.. That a final award by the board or
a judgment of a court1 would have resolved uncertainty as to
liability or extent of injury is apparent from a reading of
pertinent parts of section 5 of article 8307:

fill questions arisins under this law. if
not settled bv aoreement of the varties
interested therein and within the vrovisions
of this law, shall. extent as otherwise
provided. be determined by the Board. Any
interested party who is not willing and does
not consent to abide by the final ruling and
decision of said Board shall, within twenty

1. Of course, an award or judgment is not final until
all appellate remedies have been exhausted.

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Mr. Joseph C. Gagen - Page 3 (JM-931)

(20) days after the rendition of said final
ruling and decision by said Board, file with
said Board notice that he will not abide by
said final ruling and decision. And he shall
within twenty (20) days after giving such
notice bring suit in the county where the
injury occurred, or in the county where the
employee resided at the time the injury
occurred (or, if such employee is deceased,
then in the county where the employee resided
at the time of his death), to set aside said
final ruling and decision, and said Board
shall proceed no further toward the
adjustment of such claim, other than
hereinafter provided. . . . Whenever .such
*
rouoht. the riohts and liau
of the narties thereto shall b determined
bv the orovisions of this la:. (Emphasis
added.)

The liability of the association and the extent of the
injury are the two key issues to be determined by the board
or by a court in a worker's compensation case. We find no
provision of law relieving the board or a court from the
duty to determine liability and extent of injury in render-
ing a final award or judgment. Once liability and extent of
injury are finally determined by the board or by a court,
there would remain no uncertainty as to the liability or
extent of injury that would authorize the board under
section 12 to approve a subsequent compromise settlement
agreement regarding future medical expenses.

Moreover, section 5 makes the only specific provision
for the board's handling of medical expense claims after a
final award by the board or a judgment of a court.

Notwithstanding any other provision of
this law, as amended, no award of the Board,
and no judgment of the court, having juris-
diction of a claim against the association
for the cost or expense of items of medical
aid, hospital services, nursing, chiropractic
services, medicines or prosthetic appliances
furnished to an employee under circumstances
creating a liability therefor on the part of
the association under the provisions of this
law, shall include in such award or judgment
any cost or expense of any such items not
actually furnished to and received by the
employee prior to the date of said award or

p. 4674
Mr. Joseph C. Gagen - Page 4 (JM-931)

judgment. The first such final award or
judgment rendered on such claim shall be res
judicata of the liability of the association
for all such cost or expense which could have
been claimed up to the date of said award or
judgment and of the issue that the injury of
said employee is subject to the provisions of
this law with respect to such items, but
shall not be res judicata of the obligation
of the association to furnish or pay for any
such items after the date of said award or
nt. After the first such final award
oment. the Board shall have continuinq
iurisdiction in the same case to render
successive awards to determine the liabilitv
gf the association for the cost or exoense of
w such items actuallv furnished to and
received bv said emulov e not more than six
(6) months orior to tze date of each such
successive award, until the association shall
have fullv discharaed its oblicration under
this law to furnish all such medical aid,
hosnital services. nursina. ChirODraCtiC
. .
services. medicines or DrOSthetiC aDDliance
$0 hich said emulovee mav be entitled:
provyded, each such successive award of the
Board shall be subject to a suit to set aside
said award by a court of competent
jurisdiction, in the same manner as provided
in the case of other awards under this law.
(Emphasis added.)

The board possesses only those powers conferred on it by
statute. We have found no provisions authorizing the board
to approve compromise settlements subsequent to board awards
or court judgments, or to take other action regarding future
medical expenses. Section 5 provides a procedure the board
may utilize for the disposition of claims for medical
expenses incurred subsequent to a board award or court
judgment.

AUTHORITY OF THE BOARD TO APPROVE COMPROMISE
SETTLEMENT AGREEMENTS REGARDING FUTURE
MEDICAL EXPENSES SUBSEQUENT TO AN ORIGINAL
COMPROMISE SETTLEMENT AGREEMENT.

We note at the outset that we have found no reported
cases dealing with a compromise settlement agreement made
subsequent to an original compromise settlement agreement.
Many courts have stated that once an original compromise

p. 4675
 Mr. Joseph C. Gagen - Page 5 (JM-931)

settlement agreement is approved by the board, the agreement
is binding on the parties until the original settlement
agreement is lawfully set aside by a court. See. e.cr.,
Luersen v. Trawerica Insurance Co, 550 S.W.2d 171 (Tex.
Civ. App. - Austin 1977, writ ref'd n1r.e.); Pearce v. Texas
EmoloversJnsurance Association 403 S.W.2d 493 (Tex. Civ.
APP. - Dallas 1966, writ ref'd' n.r.e.), reh*a denied, 412
S.W.Zd 647 (Tex. 1967), and the authorities cited therein.

In this vein, section 12b of article 8307, V.T.C.S.,
now specifically provides that the board "shall have no
jurisdiction to rescind or set aside any compromise
settlement agreement approved by the board or any agreed
judgment approved by the court." Acts 1983, 68th Leg., ch.
501, section 1.

Section 12b now also provides a specific procedure for
the board's resolving disputes as to' medical expenses
arising pursuant to compromise settlement agreements
approved by the board or agreed judgments approved by the
court :

Whenever in any compromise settlement
-.. agreement approved by the board or in any
agreed judgment approved by the court, any
dispute arises concerning the payment of
medical, hospital, nursing, chiropractic or
podiatry services or aids or treatment, or
for medicines or prosthetic appliances for
the injured employee as provided in Section
7, Article 8306, Revised Statutes,
amended, or as provided in such compromizi
settlement agreements or agreed judgments,
all such disputes concerning the payment
thereof shall be first presented by any party
to the Industrial Accident Board within six
months from the time such dispute has arisen
(except where 'good cause' is shown for any
delay) for the board's determination. . . .

It is our opinion that approval of a compromise
settlement agreement regarding medical expenses subsequent
to an original approved compromise settlement agreement
would necessarily have the effect of rescinding or setting
aside, at least to some extent, the original compromise
settlement agreement and would thus be barred by section
12b. Section 12b provides a procedure for the board's
dealing with questions of medical expenses pursuant to a
compromise settlement agreement or agreed judgment approved
by a court.

p. 4676
Mr. Joseph C. Gagen - Page 6 (JM-931)

-.

SUMMARY

After a final award of the board, court
judgment, or compromise settlement agreement
which has not been lawfully set aside, the
Industrial Accident Board has no authority to
approve a compromise settlement agreement to
terminate liability for future medical
expenses.

JIM MATTOX
Attorney General of Texas

MARYRELLER
First Assistant Attorney General

MU MCCREARY
Executive Assistant Attorney General

JUDGE ZOLLIE STBARLBY
Special Assistant Attorney General

RICK GILPIN
Chairman, Opinion Committee

Prepared by William Walker
Assistant Attorney General

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