Zurich American Insurance Co. v. Gill

� Under the facts of this case, although the appellee�s condition was an ordinary disease of life, not incident to a compensable injury or occupational disease, her condition was an "injury" for purposes of the Texas Labor Code �401.011(26).

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Click here for the full text of this decision FACTS:Lauren Gill, who had suffered from allergy problems since she was a child, began experiencing increasing allergy-related symptoms two months after she began working at Professional Employer Services. She soon discovered that the ceiling tiles in her office were contaminated with stachybotrys mold, and Gill was diagnosed with allergic rhinitis and maxillary sinusitis. Gill filed a workers’ compensation claim, of which her employer’s insurer, Zurich American Insurance Co., received notice in May 2001. Zurich did not respond to the claim until Jan. 8, 2002, at which time it contested the compensability of Gill’s alleged injury. At a contested-case hearing on Oct. 31, 2002, the hearing officer found that Gill sustained injuries on June 1, 2000, that were ordinary diseases of life, and that Gill’s allergic rhinitis and maxillary sinusitis were not injuries in the form of an occupational disease. The hearing officer also found, however, that Zurich did not timely contest compensability and therefore could not challenge whether the injury was compensable. On the other hand, Gill did not timely notify her employer of her injury, the hearing officer found. Zurich, therefore, did not have to pay Gill’s claim. Both Gill and Zurich appealed to the Workers’ Compensation Commission Appeals Panel. The panel affirmed the hearing officer’s determination of the day of the injury, but also that Gill did not sustain an injury in the form of an occupational injury and that she did not timely notify her employer of the injury. The panel also agreed with the determination that Zurich had not timely objected; however, the panel disagreed with the hearing judge’s determination that Zurich was relieved of its obligation to pay Gill’s claim. Because Zurich waived its right to contest compensability, Gill had a compensable injury as a matter of law, the panel concluded. Zurich took the case to the trial court, and Gill filed a counterclaim � both cases were based on essentially the same grounds as were brought to the appeals panel. The trial court denied Zurich’s motion, which asked, “whether or not Ms. Gill sustained an injury as outlined in the Texas Labor Code,” and affirmed Gill’s motion, which asked whether Zurich “waived the right to contest compensability of the claimed injury by not timely contesting the injury.” The trial court affirmed the appeals panel’s decision. HOLDING:Affirmed. The court examines the definitions of injury and occupational disease found in Texas Labor Code 401.011, noting that to be “compensable,” the injury must arise out of and in the scope and course of employment for which compensation is payable. The court also confirms that it is not disputed that Zurich did not contest compensability within the 60-day period allowed for such an objection by Labor Code 409.021(c). While Zurich says that as there was no injury, and consequently no compensable injury, then there was no duty to comply with 409.021(c), Gill counters that if such an argument prevailed, insurance companies would never promptly respond to a claim. The court discusses a case both parties bring forward: Continental Casualty Company v. Williamson, 971 S.W.2d 108 (Tex. App. Tyler 1998, no pet.), where the appellate court reversed a trial court’s ruling that if a hearing officer determines that there is no injury, and that finding is not against the great weight and preponderance of the evidence, then the carrier’s failure to contest compensability cannot create an injury as a matter of law. The court points out that the Workers’ Compensation Appeals Panel has said that Williamson is limited to situations where there is a determination by the hearing officer that the claimant did not have an injury, that is, no damage or harm to the physical structure of the body, as opposed to cases where there is an injury or disease determined by the hearing officer not to have been causally related to the employment. The court also reviews Continental Casualty Company v. Downs, 81 S.W.3d 803 (Tex. 2002), in which the Texas Supreme Court agreed with the San Antonio Court of Appeals that, by failing to meet the seven-day deadline contained in former 409.021(a), the insurer no longer had the 60 days allowed by 409.021(c) to investigate compensability. Applying these two cases, the court holds that Gill has an injury that is compensable by Zurich. Because Zurich did not act within the seven-day period, let alone within the 60-day period, it no longer had a right to contest compensability of the injury, a conclusion that Zurich agrees with, though it still argues that the Williamson case allows it to dispute the occurrence of an injury, although not its compensability. Noting again the limited way in which the Workers’ Compensation Appeals Panel has interpreted Williamson, the court finds that because the hearing officer found that Gill had an injury, Williamson does not apply here. The sole issue, the court concludes, is whether Gill had an injury. Because Gill has not pointed to any evidence that her rhinitis and maxillary sinusitis were anything other than ordinary diseases of life, the court agrees with the panel that she has not shown that her condition is an occupational disease. Consequently, to be an injury, Gill’s condition must qualify as damage or harm to the physical structure of the body and a disease or infection naturally resulting from the damage or harm. Gill has established the existence of her symptoms, which caused physical harm or damage to her body. Because Gill’s chronic allergic rhinitis and maxillary sinusitis resulted in the malfunctioning of the physical structure of the body, the panel’s determination that Gill had an injury is supported by the evidence. “Consequently, we hold that, under the facts of this case, although Gill’s condition was an ordinary disease of life, not incident to a compensable injury or occupational disease, her condition was an”injury’ for purposes of section 401.011(26) of the Texas Labor Code. Thus, because Zurich cannot contest the compensability of the injury, it owes medical benefits to Gill.” OPINION:Dauphinot, J.; Livingston, Dauphinot and McCoy, JJ. DISSENT:McCoy, J. “I do not believe that the Legislature intended that an”injury’ encompass the symptoms of an”ordinary disease of life,’ as has been found present here, any more than those from a common cold, a cold sore (a viral infection), or athlete’s foot (a fungal infection).”

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