Entergy Gulf States, Inc. v. Summers
Full Opinion (html_with_citations)
delivered the opinion of the Court, in which
Rehearing was granted in this case and our previous opinion was withdrawn. We now substitute the following in its place. The judgment remains unchanged.
In this workersâ compensation case, we decide whether a premises owner that contracts for the performance of work on its premises, and provides workersâ compensation insurance to the contractorâs employees pursuant to that contract, is entitled to the benefit of the exclusive remedy defense generally afforded only to employers by the Texas Workersâ Compensation Act. While the Act specifically confers statutory employer status on general contractors who qualify by providing workersâ compensation insurance for their subcontractorsâ employees, it says nothing about whether premises owners who act as their own general contractor are also entitled to employer status, and thus the exclusive remedy defense. We hold that the exclusive remedy defense for qualifying general contractors is, likewise, available to premises owners who meet the Actâs definition of âgeneral contractor,â and who also provide workersâ compensation insurance to lower-tier subcontractorsâ employees. Because we conclude that Entergy Gulf States, Inc. meets the definition of âgeneral contractorâ under the Act, and because Entergy otherwise qualifies under the Act as having provided workersâ compensation insurance under its written agreement with International Maintenance Corporation (IMC), it is entitled to the exclusive remedy defense against the negligence claims brought by IMCâs employee, John Summers. We reverse the court of appealsâ judgment and render judgment for Entergy.
I
Entergy contracted with IMC to assist in the performance of certain maintenance, repair and other technical services at its
II
The Act outlines a process by which a general contractor qualifies for immunity from common-law tort claims brought by the employees of its subeon-tractors.
Summers first argues that Entergy failed to establish as a matter of law that Entergy and Summers executed a written agreement under which Entergy would provide workersâ compensation coverage. See Tex. Lab.Code § 406.123(a). Summersâ chief argument is that the contract for maintenance, construction, and general services was between IMC and another Entergy company, Entergy Services, Inc., as opposed to Entergy Gulf States, Inc. However, the contract stated that Entergy Services, Inc. acted for itself and as agent for other Entergy Companies, defined to include the Entergy petitioner here. Summers also admitted in his response to En-tergyâs summary judgment motion that the
Ill
The meaning of a statute is a legal question, which we review de novo to ascertain and give effect to the Legislatureâs intent. F.F.P. Operating Partners., L.P. v. Duenez, 237 S.W.3d 680, 683 (Tex.2007). Where text is clear, text is determinative of that intent. State v. Shumake, 199 S.W.3d 279, 284 (Tex.2006) (â[W]hen possible, we discern [legislative intent] from the plain meaning of the words chosen.â); see also Alex Sheshunoff Mgmt. Sens., L.P. v. Johnson, 209 S.W.3d 644, 651-52 (Tex.2006). This general rule applies unless enforcing the plain language of the statute as written would produce absurd results. Fleming Foods of Tex., Inc. v. Rylander, 6 S.W.3d 278, 284 (Tex.1999). Therefore, our practice when construing a statute is to recognize that âthe words [the Legislature] chooses should be the surest guide to legislative intent.â Fitzgerald v. Advanced Spine Fixation Sys., Inc., 996 S.W.2d 864, 866 (Tex.1999). Only when those words are ambiguous do we âresort to rules of construction or extrinsic aids.â In re Estate of Nash, 220 S.W.3d 914, 917 (Tex.2007).
With these principles in mind, we examine what the Legislature meant by the term âgeneral contractorâ in the workersâ compensation statute. We do not look to the ordinary, or commonly understood, meaning of the term because the Legislature has supplied its own definition, which we are bound to follow. Tex. Govât Code § 311.011(b). The Legislature defines âgeneral contractorâ as:
[A] person who undertakes to procure the performance of work or a service, either separately or through the use of subcontractors. The term includes a âprincipal contractor,â âoriginal contractor,â âprime contractor,â or other analogous term. The term does not include a motor carrier that provides a transportation service through the use of an owner operator.
Tex Lab.Code § 406.121(1). That a premises owner can be a âpersonâ within the meaning of the statute is not challenged. The dispute, instead, centers on whether one who âundertakes to procure the performance of workâ can include a premises owner, or whether that phrase limits the definition of general contractor to non-owner contractors downstream from the owner.
Since the words contained within the definition are not themselves defined, we apply a meaning that is consistent with the common understanding of those terms. According to Blackâs Law Dictionary, âundertakeâ generally means to âtake on an obligation or task,â and âprocurementâ
IV
The dissent, and some amici, contend that our reading of the statute constitutes a major change in the law that, for the first time, would enable premises owners to become statutory employers entitled to the exclusive remedy defense â a result they say the Legislature never intended. 282 S.W.3d 511. However, the Legislature enacted the section that established âdeemed employerâ status in 1917, the very first provision to address a subscriberâs coverage of subcontractorsâ employees. See Act of Mar. 28, 1917, 35th Leg., R.S., ch. 103, § 1, Part II, sec. 6, 1917 Tex. Gen. Laws 269, 284-85. Since then, subsequent revisions have not indicated an intent to create the kind of exception for owner-subscribers the dissent would now recognize. Indeed, when the âdeemed employerâ statute was first enacted, the Act made no reference at all to âgeneral contractors.â Instead, the provision applied only to âsubscribers,â a general term that included all purchasers of workersâ compensation insurance.
V
The dissent contends that the Act never covered premises owners in the first place, and that owners were not included within the definition of general contractors in the 1989 amendment. We disagree. The originating statute applied to âany subscriber,â which necessarily means that, under the old version of the Act, a subscriber who also happened to be a premises owner would not be permitted to escape liability to a worker by contracting out the work.
By operation of the statute, then, the owner-subscriber who contracted out work to avoid liability for its workersâ injuries would nevertheless be considered the employer, the injured worker would be entitled to benefits under the ownerâs workersâ compensation policy, and the owner would be entitled to assert the exclusive remedy defense. See Act of Mar. 28, 1917, 35th Leg., R.S., ch. 103, § 1, Part II, sec. 6, 1917 Tex. Gen. Laws 269, 284-85. So while the provision may have been enacted for the purpose of preventing employers from trying to avoid liability, the scope of its application did not exclude premises owners.
In 1983, however, an amendment provided, for the first time, for voluntary employer status for upstream entities in the contracting chain through the use of written agreements between parties. Act of May 28, 1983, 68th Leg., R.S., ch. 950, § 1, sec. 6, 1983 Tex. Gen. Laws 5210, 5210-11. More specifically, a general contractor was permitted to enter into a written agreement to provide workersâ compensation insurance coverage to its subcontractors and its subcontractors employees and, upon do-, ing so, the âprime contractorâ
There can be no doubt that premises owners can be, and often are, employers who carry workersâ compensation insurance. It is also true that owners frequently contract with others to perform work on their premises. But there has never been a requirement that an owner must first engage a general contractor to have work done on its premises. The owner is free to do the work with its own employees, to directly contract with others to do the work, or to do the work using some combination of the two. The dissent says an owner can be an employer, but cannot be a general contractor. However, we can find nothing in the statute specifying that an owner who also wears the hat of a general contractor is disqualified from coverage under the Workersâ Compensation Act simply because it chooses to contract directly for work on its premises.
Entergy did the very thing the Legislature has long tried to encourage; that is, Entergy became a subscriber by taking out a workersâ compensation policy for the entire work site. It would be an odd result, indeed, if this premises owner, acting as its own general contractor, and further acting in accordance with the Stateâs strong public policy interest of encouraging workersâ compensation insurance coverage for workers, was now to be excluded from the Actâs protections. See Tex. Workersâ Comp. Commân v. Garcia, 898 S.W.2d 504, 510-16 (Tex.1995). Whether a premises owner, general contractor, prime contractor, or subcontractor, Entergy is a âsubscriberâ of a workersâ compensation policy and therefore satisfies the Legislatureâs intent to ensure consistent and reliable coverage to all employees.
VI
The dissent and the court of appeals contend that the only way to qualify as a âgeneral contractorâ is to be included in a âtripartiteâ relationship in which a general contractor in the middle of the transaction has, first, undertaken to perform work for an owner, and second, contracted part of that work to a subcontractor. 282 S.W.3d 511. But the statute is not written so restrictively as to encompass only a three-party relationship, for several reasons. First, such a construction ignores the single exception found in the last sentence of the definition: âThe term does not include a motor carrier that provides a transportation service through the use of an owner operator.â Tex. Lab.Code § 406.121(1). Here, the inclusion of an âowner operatorâ in the definitionâs only exception indicates that the Legislature intended for some owners to qualify as general contractors, while carving out only a narrow class of owners excluded from the term. Id. Since the Legislature clearly specified that the exception apply only to a very narrow class, we decline to read this narrow exception broadly to include all premises owners.
Second, the definition is not as restrictive as the dissent supposes because the second sentence of the definition, which specifies types of contractors to be included within the definition, specifically provides that the list is non-exhaustive. Id. (âThe term includes a âprincipal contractor,â âoriginal contractor,â âprime contractor,â or other analogous term.â). If we held that an âowner contractorâ is not analogous to a âprincipal contractor,â âoriginal contractor,â or âprime contractor,â we would essentially be strictly construing a sentence that is explicitly non-exhaustive, as even the dissent concedes. 282 S.W.Bd 511. Inasmuch as we have been instructed that â â[ijncludesâ and âin-
Additionally, such a reading renders meaningless the part of the definition that qualifies how a general contractor âundertakes to procure the performance of work.â Tex. Lab.Code § 406.121(1) (a general contractor âundertakes to procure the performance of work or a service, either separately or through the use of subcontractors â) (emphasis added). A reasonable reading of the words, âeither separately or through the use of subcontractors,â recognizes the distinction between the owner who takes it upon himself âseparatelyâ to procure the performance of work from subcontractors, and the owner who undertakes with a middleman âgeneral contractorâ to procure the performance of work âthrough the use of subcontractors.â See id.; see also Blaokâs Law DICTIONARY 1099 (7th ed. 2000) (âSeparateâ is defined as âindividual; distinct, particular; disconnectedâ). Certainly, one can hire a bricklayer, electrician, or cabinet maker to remodel his own office buildingâ thereby acting âseparatelyâ â or, he can hire a general contractor to do the same thing â thereby acting âthrough the use-of subcontractors.â This qualifier suggests that the Legislature at least contemplated the existence of a premises owner who may want to act as its own general contractor â an outcome that is by no means uncommon.
Finally, we address Williams v. Brown & Root, Inc., the case relied on by the court of appeals in reaching its conclusion that a premises owner is excluded from the Actâs definition of âgeneral contractor.â 947 S.W.2d 673 (Tex.App.-Texarkana 1997, no writ). In Williams, a premises owner, Eastman, contracted with Brown & Root to provide occasional construction services. Id. at 675. Brown & Root subcontracted part of the work to Tracer. Id. Tracerâs employee, Williams, was injured on Eastmanâs jobsite, so he applied for and received benefits from Eastmanâs workersâ compensation policy covering Tracer. Id. After Williams sued Eastman and Brown & Root for his injuries, the trial court granted summary judgment for both defendants, in part because the exclusive remedy was workersâ compensation insurance, which had already been provided. Id. On appeal, the court of appeals rejected the argument that the predecessor to this section of the Act
âArguably,â the court observed, âbecause Eastman did not contract with the owner, but instead was the owner, Eastman was not protected [by the statute].â Id. Not only was the courtâs observation here unnecessary to the decision in the case, it was also erroneous. The court erred by subordinating the statuteâs specific definition of âgeneral contractorâ in favor of a generic definition outside the statute. Id. at 677 (âA general contractor is any person who contracts directly with the owner ....â) (internal citations and quotations omitted). Since the Legislature provided its own definition for âgeneral contractor,â we elevate the Legislatureâs substituted meaning even when it departs from the termâs ordinary meaning. Tex. Govât Code § 311.011(b).
VII
We granted rehearing to address several supplemental arguments made by the respondent and by a number of amici, many of which urge us to address the issue before us by going beyond the statutory text and looking to extrinsic aides such as the Actâs legislative history. But we have been clear that we do not resort to such extrinsic aides unless the plain language is ambiguous. See, e.g., Nash, 220 S.W.3d at 917 (âIf a statute is clear and unambiguous, we apply its words according to their common meaning without resort to rules of construction or extrinsic aides.â); Sheshunoff, 209 S.W.3d at 652 n. 4.
Even if we assume the definition of âgeneral contractorâ is ambiguous, the legislative history of the billâs passage favors Entergy, not Summers. The legislative history that supports Summersâ outcome is
As for the legislative history of what did pass, the 1989 overhaul of the Workersâ Compensation Act amended the statutory definition of âsubcontractor.â Under the pre-1989 definition, a subcontractor was defined as âa person who has contracted to perform all or any part of the work or services which a prime contractor has contracted with another party to perform.â Act of May 28, 1983, 68th Leg. R.S., ch. 950, § 1, 1983 Tex. Gen. Laws 5210, 5210, amended by Act of Dec. 11, 1989, 71st Leg.2d C.S., ch.l, § 3.05(a)(5), 1989 Tex. Gen. Laws 1, 15 (emphasis added). The Act, as amended, deleted âwith another party,â which is the very phrase that Summers argues prevents a premises owner from also being the general contractor. See Wilkerson v. Monsanto Co., 782 F.Supp. 1187, 1188-89 (E.D.Tex.1991) (interpreting âcontracted with another partyâ in the pre-1989 definition to mean the prime contractor and premises owner must be distinct entities). We give weight to the deletion of the phrase âwith another partyâ from the amended definition since we presume that deletions are intentional and that lawmakers enact statutes with complete knowledge of existing law. See Acker v. Tex. Water Commân, 790 S.W.2d 299, 301 (Tex.1990). It is, of course, axiomatic that the deletion of language better indicates the Legislatureâs intent to remove its effect, rather than to preserve it. Thus, the removal of the phrase âwith another partyâ from the subcontractor definition favors, rather than argues against, an interpretation allowing premises owners to act as their own general contractors for the purpose of workersâ compensation laws. Tex. Lab.Code § 406.121(5). Enforcing the law as written is a courtâs safest refuge in matters of statutory construction, and we should always refrain from rewriting text that lawmakers chose, but we should be particularly unwilling to reinsert language that the Legislature has elected to delete. See Simmons v. Arnim, 110 Tex. 309, 220 S.W. 66, 70 (1920) (âCourts must take statutes as they find them.â).
Amici cite to statements by some lawmakers that the Act, and particularly the 1989 amendment, was never intended to provide statutory employer status to premises owners. Just as we decline to consider failed attempts to pass legislation, we likewise decline consideration of law
VIII
Excluding a premises owner who acts as a general contractor also fails to serve the public policy of encouraging workersâ compensation coverage for all workers. See Wingfoot Enters, v. Alvarado, 111 S.W.3d 134, 140, 142 (Tex.2003); Garcia, 893 S.W.2d at 521. As noted, the Act offers incentives to general contractors to provide workersâ compensation coverage broadly to work site employees. In exchange, the Act specifically protects general contractors â who are not direct employers of subcontractorsâ employees â by allowing them to assert as a statutorily deemed employer the exclusive remedy defense. In light of this statutory protection, it would seem to be contrary to the stateâs public policy to read out of the Actâs protections those premises owners who have otherwise qualified under the Act by purchasing workersâ compensation coverage for their work site employees, but who have chosen to act as their own general contractor.
In the dissentâs view, a premises owner who, in complying with the Act, enters into a written agreement to provide workersâ compensation coverage to all contractors and contractorsâ employees at its work site would be the only contractor-employer in the contracting chain not afforded the exclusive remedy defense. Presumably, in that event all the downstream contractors would be considered subscribers under the premises ownerâs OPIP, thereby qualifying as statutory employers by virtue of their written agreements. See Tex. Lab.Code § 406.123(a). But the dissent would disqualify the premises owner â the one who secured and actually paid for the policyâ from being a statutory employer of his subcontractorsâ employees. As a result, the premises ownerâs own employees, working side-by-side with the other contractorsâ employees, would be limited to workersâ compensation benefits for their injuries while the other contractorsâ employees injured in the same accident would be permitted to seek tort remedies against the premises owner in addition to the workersâ compensation benefits provided by the premises owner. Unless the statute directs such a result, it makes no sense to read the statute in such an unreasonable manner. The dissent contends that this outcome is a policy choice made by the Legislature, but we interpret the statute in the context of a policy that encourages the provision of workersâ compensation coverage to all workers on a given work site, not discouraging it by denying the statuteâs protections to the owner who enters into just such a plan.
IX
We conclude that Entergy qualifies under the Actâs definition as a âgeneral contractorâ and, as a statutory employer, is entitled to assert the exclusive remedy defense. Tex. Lab.Code § 408.001. The judgment of the court of appeals is re
. Such immunity arises when the statutory employer invokes the "exclusive remedyâ defense, which limits the employee's "exclusive remedyâ to recovery of workers' compensation benefits. Tex. Lab.Code § 408.001(a).
. "A general contractor and a subcontractor may enter into a written agreement under which the general contractor provides workersâ compensation insurance coverage to the subcontractor and the employees of the subcontractor.â Tex. Lab.Code § 406.123(a).
. "An agreement under this section makes the general contractor the employer of the subcontractor and the subcontractor's employees only for purposes of the workersâ compensation laws of this state.â Id. § 406.123(e).
."Recovery of workersâ compensation benefits is the exclusive remedy of an employee covered by workersâ compensation insurance coverage or a legal beneficiary against the employer or an agent or employee of the employer for the death of or a work-related injury sustained by the employee.â Id. § 408.001(a).
. It has long been the policy of this State, expressed in every version of the Act, that no subscriber can avoid covering an injured worker merely because he was employed by a subcontractor. The 1917 version of the Act created a "deemedâ employer status to address this concern:
If any subscriber to this Act with the purpose and intention of avoiding any liability imposed by the terms of the Act sublets the whole or any part of the work to be performed or done by said subscriber to any sub-contractor, then in the event any employe[e] of such sub-contractor sustains an injury in the course of his employment he shall be deemed to be and taken for all purposes of this Act to be the employe[e] of the subscriber, and in addition thereto such employe[e] shall have an independent right of action against such sub-contractor, which shall in no way be affected by any compensation to be received by him under the terms and provisions of this Act.
Act of Mar. 28, 1917, 35th Leg., R.S., ch. 103, § 1, Part II, sec. 6, 1917 Tex. Gen. Laws 269, 284-85. In 1983, HB 1852 amended the statute by adding a different provision using the term "prime contractor," defined to mean "the person who has undertaken to procure the performance of work or services.â Act of May 28, 1983, 68th Leg., R.S., ch. 950, § 1, sec. 6, 1983 Tex. Gen. Laws 5210, 5210-11. Then, in 1989, the last major overhaul of the Act kept the "undertaken toâ definition, but substituted the term âprime contractorâ for "general contractorâ and defined that person with the same language: "a person who has undertaken to procure the performance of work or services, either separately or through the use of subcontractors.â Act of Dec. 12, 1989, 71st Leg., 2d C.S., ch. 1, § 3.05, 1989 Tex. Gen. Laws 1, 15. The 1917 "deemed employerâ provision remains virtually unchanged in the current Labor Code, except the term "subscriberâ has been replaced by the term, "person who has workersâ compensation insurance coverage.â Act of May 12, 1993, 73rd Leg., R.S., ch. 269, § 1, 1993 Tex. Gen. Laws 987, 1159 (current version at Tex. Lab.Code § 406.124).
. "Prime contractorâ was later replaced by the current term, "general contractor,â but the definition remained substantively verbatim. Act of May 28, 1983, 68th Leg., R.S., ch. 950, § 1, sec. 6(c), 1983 Tex. Gen. Laws 5210, 5210-11 amended by Act of Dec. 12, 1989, 71st Leg., 2d C.S., ch. 1, § 3.05(a)(2), 1989 Tex. Gen. Laws 1, 15 (current version at Tex Lab.Code § 406.121(1)).
. Act of May 28, 1983, 68th Leg., R.S., ch. 950, § 1, sec. 6(d), 1983 Tex. Gen. Laws 5210, 5211 (current version at Tex. Lab.Code § 406.124).
. See, e.g., CLDC Mgmt. Corp. v. Geschke, 72 F.3d 1347, 1349 (7th Cir.1996) (noting that "the Geschkes chose to act as their own general contractor on the jobâ); Milwaukee & Southeast Wisconsin Dist. Council of Carpenters v. Rowley-Schlimgen, Inc., 2 F.3d 765, 767-68 (7th Cir.1993) ("[T]he Board held that Churchâs Fried Chicken ... functioned as its own general contractor in the 'continuing operation of building stores.â â); Applewood Landscape & Nursery Co., Inc. v. Hollingsworth, 884 F.2d 1502, 1503 (1st Cir.1989) (noting that appellant who built house for himself "decided to act as his own general contractor, at least in respect to landscapingâ); Lazar Bros. Trucking, Inc. v. A & B Excavating, Inc., 365 Ill.App.3d 559, 302 Ill.Dec. 778, 850 N.E.2d 215, 217 (2006) (noting that appellee "sought to develop land it ownedâ and "decided to act as its own general contractor for the projectâ); 1000 Va. Ltd. P'ship v. Vertecs Corp., 158 Wash.2d 566, 146 P.3d 423, 426 (2006) (noting that partnership, "acting as its own general contractor, built an apartment complexâ); Waggoner Motors, Inc. v. Waverly Church of Christ, 159 S.W.3d 42, 47 (Tenn.Ct.App.2004) (noting that appellant "church, acting as its own general contractor, began constructing a 9,000-square-foot general purpose building in back of its existing buildingâ); Mortenson v. Leatherwood Constr., Inc., 137 S.W.3d 529, 531 (Mo.Ct.App.2004) (noting that school district "acted as its own general contractorâ on project to construct addition to school); Wheeler v. T.L. Roofing, Inc., 74 P.3d 499, 501 (Colo.Ct.App.2003) (noting that, on roofing job, â[p]laintiff acted as his own general contractorâ); Cuero v. Ryland Group, Inc., 849 So.2d 326, 329 (Fla.Dist.Ct.App.2003) ("Ryland undertook to develop its own property acting as it own general contractor.â); Harris v. Rio Hotel & Casino, Inc., 117 Nev. 482, 25 P.3d 206, 207-08 (2001) (holding that landowner could be deemed a statutory employer entitled to workersâ compensation immunity).
. Act of Dec. 12, 1989, 71st Leg., 2d C.S., ch. 1, § 3.05, 1989 Tex. Gen. Laws 1, 15, repealed by Act of May 22, 1993, 73rd Leg., R.S., ch. 269, § 5, 1993 Tex. Gen. Laws 987, 1273 (current version at Tex Lab.Code § 406.121).
. Summers and amici point to nine failed bills as evidence the Legislature has ârepeatedlyâ rejected efforts to let premises owners assert the exclusive remedy defense. Chronologically, the bills are HB 2279 from the 74th Legislature (1995), HBs 2630 and 3024 from the 75th Legislature (1997), SB 1404 from the 76th Legislature (1999), HBs 3120 and 3459 from the 77th Legislature (2001), HB 2982 and SB 675 from the 78th Legislature (2003), and HB 1626 from the 79th Legislature (2005).
. Even if we were to consider failed bills, these cited bills were not only unsuccessful but, with one possible exception, unrelated to this case. See SB 1404 from the 76th Legislature (1999) (amending âgeneral contractor" to include "an owner or lessor of real propertyâ)-