### T E X A S C O U R T O F A P P E A L S , T H I R D D I S T R I C T , A T A U S T I N

NO. 03-09-00682- CV

Austin IS D, Self-In sured, Appellan t

v. Charles M. M anbeck, App ellee

F ROM TH E DISTRI CT COURT O F TRAVIS CO UNTY, 200 TH JUDICI AL DISTRICT NO. D-1 -GN-0 6-0 0138 6, H ONO RAB LE ERIC SH EP P ERD, JUDGE P RESIDING

O P I N I O N

This cause orig inated as a suit for judicial revie w broug ht by a self-insure d g overnme ntal entity

—the Austin I ndepende nt School District (AI SD), appellant—f rom a final decision and order of the Texas Depa rtment of I ns u rance Division of Workers’ Compensation (the Division) in an extent-of-injury dispute under the Workers’ Compensation Act. The claimant, Charles M. Manbec k, appellee , filed a counter claim seeking attorney s’ fee s under section 408.221, subsection (c) , of the L abor Code. Subsequently , AI SD non-suited its judicial-re view claim, and the parties proce eded to jury trial solely on Manbec k’s attorney s’-fe es counter claim. Ba sed on the jury ’s finding s, the di strict court awarde d Manbec k $36,000 for trial-level attorney s’ fees i ncurr ed up to the time of AI SD’s non-suit, an additional $17,415 for trial-leve l a ttorney s’ fe es incurr ed af

ter the non-suit, plus continge nt appellate attorney s’ fe es.I n two issues on appea l, AI SD argues that the distr i ct co u rt erred in its judgme nt

beca use (1) L abor Code section 408.221, subsection (c) , does not authorize worke rs’ compensa tion claimants to rec over “ fee s for fe es”—attorney s’ fee s incurre d solely to r ecove r any attorney s’ fe es otherwise authorized by that provision—and t hus did not authorize rec overy of t he fees M an b eck incurre d afte r AI SD non-suited its judi ci al re v i ew claim; and (2) the evidenc e was leg ally and fac tually insufficient to support t he jury ’s awa rd of the a

ttorney s’ fe es that Manbe ck wa s found t o have incurre d befor e AI SD non-suited its claim. We a g ree with AI SD’s former contention but not the latter. Consequently , we will aff irm the di strict court’s judgment awarding Manbec k $36,000 fo r t ri al -l ev el attorney s’ fee s incurre d up to the time of AI SD’s non-suit, but reve rse and rende r judgme nt that Manbec k take nothing on his claim for fe es incurr ed af ter the non- suit.

BACK GR OUND Appellant AI SD is a self-insure d g overnme ntal entity under the Workers’ Compensation Act. Appellee Manbec k was employ ed by AI SD at rele vant times. I n Marc h 2004, while on the job, Manbec k was tightening a door closer when his rig ht shou l d er p o pped and his hand went numb. Following the incident, Manbec k obtained medical trea tment which, he claimed, ag g rava ted a pree x isting condition in his lower back. He was ultimately diag nosed with injuries both
to his rig ht shoulder—“impingem ent sy ndrome rig ht shoulder with subacr omial tendonitis and

acr ominoclavicular joint arthri ti s ”

— a n d to h is lo w e r b a c k

— “ r u p tu r e d in te r v e r te b r a l d is c p o s t- lu

mb a r diskectomy with repe at lumbar fusion.” Although ack n owledg ing that Manbec k had suffe red a compensa ble injury to the extent of a sprain or strain to his rig ht shoulde r, AI SD disputed whether

2the compensa ble injury extended to his back or included the additional rig ht shoulder maladies with which he ha d been dia g nosed.

After a b en ef

i t revie w confe renc e that failed to resolve the dispute, see generally Tex. L ab. Code Ann. §§ 410.021-.34 (West 2 0 0 6 ), AIS D and Manbec k proce eded to a benef its contested case hear ing befor e a Divisio n h ea ri n g office r. See id. § 410.151 (West 2006). The decision and or der r efle cts that the following “disputed issue” w as pre sented for decision:

Does the compe n s ab l e injury of 03/30/04 extend to include: 1) ruptured interver t eb ra l d isc post-lumbar disketomy with repe at lumbar fusion and/or 2) impingeme nt sy

ndrome rig ht shou lder with subacr omial tendonitis and acr ominoclavicular

joint arthritis?

The hear ing office r found that both of Manbec k’s conditions “ar ose out of or natura lly flowed from” the compensa

ble injury and that the compensa ble injury was “a producing cause ” of both conditions. The office r rende red a decision that Manbec k’s compensa ble injury extended to both conditions, and order ed AI SD to pay benef its in acc ordanc e with that decision. See id. § 410.168(a) (West 2006). AI SD unsucce ssfully soug ht revie w befor e the Division’s appea ls panel, which had the eff ect of making the hear ing office r’s decision and order final. See id. § 410.204(c) (West 2006). Having exhausted its adminis trative re medies, AI SD timely broug ht suit for judicial review of the Division’s order in April 2006. See id. § 410.251 (West 2006). I n its petition, AI SD complained solely of the Division’s decision reg arding the extent-of-injury dispute, and it attache d a copy of the hear ing office r’s final decisi o n and order

. See id. § 410.302(b) (West 2006) (“A trial under this

s u b ch ap t er [G] is limit ed to issues decide d by the appea ls panel and on which judicial revie w i s

3soug ht” and “ [t ]he ple ading s must spec ifically set forth the deter minations of the appea ls panel by which the pa

rty is ag g rieve d.”). Although Manbec k was serve d with proce ss shortly there afte r, he did not file

an answe r until afte r AI SD soug ht a no-answe r defa ult judgme nt in J anuar

y 2007. At that juncture, Manbec k reta ined two lawy ers—Chadw ick L ee , wh o h ad repr esente d him befor e the Division; and Wade Stewart. Stewart and L ee filed an answe r containing a gener al denial and a pray er for attorney s’ fee s. The parties subsequently ex ch an g ed written discovery

. I n J une 2008, Manbec k filed a supplemental answe r wi t h a co unterc laim for attorney s’ fee s that specific ally invoked section 408.221, subsec tion (c), of the L abor Code. See id. § 408.221(c) (West 2006). Ultimately , in Dec ember 2008, AI SD non-suited its claim for judicial revie w of the Division’s decision and order , leaving pending only Manbec k’s co u n t er claim for attorney s’ fees. T h e case proce eded toward trial on that claim alone. Shortly befor e trial, Manbec k reta ined a third attorney , Br ad McClellan, who w as also desig nated a s an expert witness on attorne y s’ fe es.

Manbec k’s attorney s’-fe es counter claim was tried to a jury in J une 2009. Manbec k prese nted three witnesses—L ee, S t ew art, and McClellan—and AI SD prese nted the testimony of its trial counsel, Ronald M. J ohnson. Fo l l o wi ng the prese ntation of evidenc e, the district court submitt ed a single question to the jury inquiring as to the amount of a rea sonable fee for the

nece ssary service s of Manbe ck’s a

ttorney s for e ach of

(1) pr epar ation and trial at the district court level until the date of AI SD’s non-suit, Dec ember 12, 2008; (2) prepa ration and t ri al at the d istrict court level afte r Dec ember 12, 2008; (3) an appea l to this Court; and (4) an app ea l t o t h e Supreme Court of Te x as. The jury found that a rea sonable fee for nece ssary trial-leve l service s of

4Manbec k’s attorne y s prior to AI SD’s non-suit w as $36,000, that such a fee for his attorney s’ triallevel services thereaf

ter was $17,415, and that such a fee for a ppellate- level ser

vices wa s $38,000 in the event of an appea l to this Court and another $38,000 for an appea l to the supreme court. The district court rende red judgme nt consistent with the jury ’s finding s. After its motion to modify the judgme nt or for ne w trial wa s overr uled by operation of law, AI SD perfe cted this appe al.

ANALYSIS I n its second issue on appea l, AI SD argue s that the di strict court erre d in awa rding Manbec k attorney s’ fe es t h at he incurre d afte r it non-suited its judicial-re view claim beca use the non-suit left his attorney s’-fe es counter claim as the sole pending claim and L abo r C ode

s e c ti o n 4 0 8

. 2 2 1 , subsection (c) , does not authorize worke rs’ compensa tion claimants to r e c o v e r “ f e e s for fee s”—attorne y s’ fee s incurre d solely to rec over the attorney s’ fee s otherwise authorized under
t h at provision. I n its first issue on appea l, AI SD urg es that Manbec k failed to prese nt leg ally or fac tually sufficie nt evidenc e to support the jury ’s finding that he incurre d $36,000 in rea sonable and

nece ssary trial-leve l attorney s’ fe es prior to AI SD’s non-suit.

F ees for fees Our analy sis of AI SD’s second issue beg ins with the established principle—so well established, in fac t, that it’s long been termed the “Amer ican Rule”—that parties to litigation must bear their own attorney s’ fee s and cannot rec over them from the opposing party unless specific ally authorized by

statute or contra ct. MBM Fin. Corp. v. The W oodlands Operating Co. , 292 S.W .3d 660, 669 (Tex. 2009) (citing Tony Gullo Motors I, L.P. v. Chapa , 212 S.W .3d 2 9 9 , 3 1 0 -11

5(Tex. 2006)) (“Te x as has long follo we d t h e ‘American Rule’ prohibiting [attorney s’] fee awa rds unless specific ally provided by contra ct or statute.”). Manbec k’s attorney s’ fee awa rds in this case

are eac h predic ated on section 408.22 1 o f the L abor Code, and AI SD’s contentions require us to construe that provision.

Statutory construction prese nts a question of law that we revie w de novo. See State v. Shumake , 199 S.W .3d 279, 284 (Tex. 2006). Our pr imary objective in statutory

construction is
to g ive eff

ect to the L eg islature’s intent. See id. We seek that intent “first and fore most” in the statutory text

. Lexingto n In s . Co. v. Strayhorn , 209 S.W .3d 83, 85 (Tex. 2006). “Where text is clea r, text i s determinative of that intent.” Entergy Gulf States, Inc. v. Summers , 282 S.W .3d 433, 437 (Tex. 2009) (op. on reh’ g ) (citing Shumake , 199 S.W .3d at 284; Alex Sheshunoff Mgmt. Servs.

v. Johnson , 209 S.W .3d 64 4 , 651-52 (Tex. 2006)). We consider the words in context, not in isolation. State v. Gonzalez , 82 S.W .3d 322, 327 (Tex. 2002). We rely on the plain meaning of the
text , unless a differ ent meaning is supplied by leg islative definition or is a ppare nt f rom context, or unless such a construction leads to absurd results. See Entergy Gulf States, Inc ., 282 S.W .3d at 437; City of Rock

wall v. Hughes , 246 S.W .3d 621, 625-26 (Tex. 2008) ; see also Tex. Gov’ t Code Ann. § 311.011 (West 2005) (“Words and phrase s shall be rea d in context and construed acc ording to the rules of g rammar and common usag e,” but “ [w] ords and phr ases that ha ve ac quired a

technica l or particula r meaning , whether by leg islative definition or otherwise, shall be construed acc ording ly .”). We also presume that the L eg islature was awa re of the backg round law and acte d with ref ere nce to it. See Ack er v. Texas W

ater Comm’n , 790 S.W .2d 299, 301 (Tex. 1990). We further p re s u m e that the L eg islature selec ted statutory words, phrase s, and expressions deliberately and purposef ully

. See

6Texas L ottery Comm’n v. First State Bank of DeQue en , 325 S.W .3d 628, 635 (Tex. 2 010); Shook

v. W alden , 304 S.W .3d 910, 917 (Tex. A pp.—Austin 2010, no pet.). Our a naly sis of the statutory
text may also be informed by the pre s u m p t ions that “the entire st atute is intended to be effec tive” and that “a just and rea sonable result is intended,” Tex. Gov ’t Code Ann. § 311.021(2), (3) (West 2005), and consideration of such matters as “the object soug ht to be attained,” “cir cumstance s under which the s t atut e was enac ted,” leg islative history , “common law or former statutory provisions, including laws on the same or simil ar subjects,” “conse quenc es o f a particula r construction,” and t he enactment’s “title.” Id. § 311.023(1 )- (5), (7) (West 2005). Howeve r, onl y when the statutory text is ambig uou s “do we ‘re sort to rules of construction or extrinsi c aids.’” Entergy Gulf States, Inc ., 282 S.W .3d at 437 (quoting In r e E s t a te of Nash , 220 S.W .3d 914, 917 (Tex. 2007)). L abor Code section 408.221 regulates the aw ard of attorney s’ fee s to counsel who repr esent claimants befor e the Division or a court in disputes under the Workers’ Compensation Act. See Tex. L ab. Code Ann. § 408.221 (West 2006). Among other regul ations and restric tions, section 408.221 g ener ally require s that any fee s paid by a claimant to his counsel for repr esentation befor e the Division or a court must come out of the claimant’s rec overy , see id. § 408.221(b), caps such fee s at twenty -five perc ent of that rec overy , see id. § 408.221(i), and require s that the Division

or court (as ap p l icable) approve such fee s, see id. § 408.221(a) , considering the fac tors listed in subsection (d) of

section 408.221. See id. § 408.221(d). Those fac tors are : (1) the time and labor require d; (2) the novelty

and diffic ulty

of the que stions invol ved;
7(3) the skill required to pe rfor m the leg al servic es prope rly ; (4) the fe e customar ily char g ed in the loca lity

for similar leg al servic es; (5) the amount involved in the controve rsy ; (6) the benef

its to the claimant that the attorney is responsible for se curing ; and (7) the experienc e and a bility of the a ttorney

perf orming the servic es.

Id .; see also Arthur Andersen & Co. v. Perry Equip. Corp. , 945 S.W .2d 812, 818 (Tex. 1997) (citing

eac h of these fac tors within broade r list of “[f]actors that a fac t fi n der should consider when deter mining the r easona

bleness of a

fee ” g ener ally

). Howeve r , s u

b s e c ti o n ( c ) o f section 408.221 contains a fee -shifting provision wher eby claimants may rec over additional attorney s’ fees from insurance car riers in c erta in circumstanc es. Subsection (c) provides, in re levant par t:

An insurance car

rier that seeks judicial revie w under Subchapter G, Chapter 410, of a final decision of the appea ls panel reg arding compensa bility or elig ibilit y for, or the amount of, income or death benef its is liable for rea sonable and nece ssary attorney ’s fee s as provided b y S u b s ec t i o n (d) incurre d by the claimant as a result of the insurance car

rier’ s appea l i f the claimant preva ils on an issue on which judicial revie w is soug ht by the insurance car rier in acc ordanc e with the limit ation of issues contained in Section 410.302. I f the car rier appea ls multipl e issues and the claimant preva ils on some, but not all, of the issue s ap p ea l ed , the court shall apportion and aw ard f

ees to the claimant’s attorne y only for the issues on w hich the cla imant preva ils. I n maki n g that apportionment, the court shall consider the fac tors presc ribed by

Subsection (d).

Id. § 408.221(c)

. The provisions of subsection (c) that are direc tly applicable to this case appea r in its rather le ng thy

first sentenc e, which c an be r estated f or cla rity as follows:

8(1) I f “[a]n insurance car rier

. . . seeks judi ci al re v i ew under Subchapter G, Chapter 410, of a final decision of the appea ls panel reg a r d in g compensa

bility or elig ibilit y

for, or the amount of, income or death benef its,” (2) such a car

rier “is liable fo r re as o n able and nece ssary attorney ’s fee s as provided by

Subsection (d) [that are ] i ncurr ed by the claimant as a r esult of the insuranc e ca

rrier ’s appe al” (3) “if the claimant preva ils on an issue on which judicial revie w is soug ht by the i n s u rance car

rier in acc ordanc e with the limit ation of issues contained i n Section 410.302.”

There is n o d i s p u t e t h at AI SD, as a self-insure d g overnme ntal entity , is an “insurance car rier” for purposes of subsection (c) and that it soug ht “judicial revie w under Subchapter G, Chapter 410, of 1

a final decision of the appea ls panel reg arding comp en sability or elig ibilit y for, or the amount of, income or de ath bene fits.” Consequently , the first set of r equire ments listed above is satisfied.

AI SD likewise acknow ledg es that Manbec k “pre vailed” on “an issue on which judicial revie w is sough t b y t h e insurance car rier in acc ordanc e with the limit ation of issues contained in Section 410.302,” there by satisfy ing the third set of require ments lis t ed above. The “limitation of issues contained i n Section 410.302” ref ers to the require ments in L abor Code section 410.302 that “[a] trial under this subcha pter [G] is limited to issues decide d by the appea ls panel a nd on which judi cial review is soug ht” and that “[t ]he pleading s must specifically set forth the determinations of t he appeals panel by which the pa

rty is ag g rieve d.” Id. § 410.302(b). He re, the “issue on which judicial relief [was] soug ht by [AI SD] in acc ordanc e with the limit ation of issues contained in Section 410.302” was the extent- o f- i n j u ry d ispute that had been the focus of the

See Tex. L ab. Code Ann. § 401.011( 27) (West 2006). 1 9Division’s decision and AI SD’s petition. There appea rs to be no dispute that Manbec k “pre vailed”

on that i ssue, within the meaning of section 408.221, subsection (c) , inasmuch as AI SD’s nons u i t h ad the eff

ect of placing the parties in the same leg al position with respe ct to that is s u e

as if Manbec k had wo n o n t h at i s s ue at trial. See, e.g. , Twi n City Fire Ins. Co. v. Vega-G arcia , 223 S.W .3d 762, 767-69 (Te x . App.—Dallas 2007, pe t. denied). 2

AI SD instead focuse s its contentions on the second set of require ments listed above. I t argues that any attorney s’ fee s Manbec k incurre d afte r it non-suited its judicial-re view claim could

n o t h ave been “incur

red by the claimant as a result of the insurance car rier’ s appea l” wit h i n t h e meaning of section 408.221, subsection (c). AI SD urg es that subsec tion (c) c ontemplates that the
attorn ey s ’ fee s a claimant incurs “as a result of the insurance car rier’ s appea l” are only those it incurs in pre vailing on “ an issue on which judicia l review is sought by

the insurance car

rier.” See Tex. L ab. Code Ann. § 408.221(c)

. Once it non-suit ed i t s judicial-re view claim, AI SD observe s, the sole issue that rema ined for judicial resolution was Manbec k’s counter claim for attorney s’ fee s under section 408.221, subsection (c)

. Whether Manbec k was entitled to a ttorney s’ fee s under the provis i on, AI SD rea sons, was not in itself an “issue on which judicial revie w [was] soug ht by [AI SD] ,” so none of the fee s he incurre d in pursuing that claim would “re sult from” AI SD’s appea l. AI SD disputes, in other words, whether subsection (c) authorizes rec overy of attorney s’ fee s that a claimant incurs in rec overing the attorney s ’ fe es h e incurs in preva iling on “issue[s] on which judicial revie w is sought by the insuranc e ca

rrier .”

Nor does AI SD dispute that Manbec k’s attorney s’ fee counter claim survived its non-suit. 2 See Twi n City Fire Ins. Co. v. Vega-G arcia , 223 S.W .3d 762, 768 (T ex . App.—Dallas 2007, pet. denied)

. 10I n response , Manbec k argues that the phrase “an issue on which judic i al re l ief is

soug ht by [AI SD] ” (in the third set of require ments listed above) i n cl u d ed n o t only the g rounds raised in AI SD’s suit, but his claim for attorney s’ fee s under subsection (c ). He u rges that his ultimate entitlement to attorney s’ fee s under subsection (c) was n ec es s arily “an issue on which judicial relief is soug ht by [AI SD] ” both at the t ime of fili ng , beca use AI SD’s act of filing its suit implicated that statute’s fee -shifting reg ime, and as the case prog resse d. But Manbec k’s proposed construction of “issue on which judicial revie w is soug ht” overlooks the rema inder of the sentenc e in which that phrase appea rs—“a n issue on which judicial revie w is soug ht by the insurance car rier in accordanc e with the limitati on of issues contained in Section 410.302 .” By expli citly ty ing “issue

on which judicial revie w is soug ht” to the specific proce dural framework o f s ec t i o n 410.302, the L eg islature evidenc ed i t s intent to define or limit such “issues” to those identified throug h section 410.302’s “limi t ati on of issues.” Consequently , the “issue on which judicial relief [was] soug ht by [AI SD] in acc ordanc e with the limit ati o n o f i s sues contained in Section 410.302,” as previously

indicated, was the parties’ extent-of-injury dispute, and could not include a ny future or potential claim or dispute reg arding Manbec k’s entitlement to attorney s’ fee s under subsection (c)

.

Manbec k also disputes that the “re asonable and nece ssary attorney ’s fee s . . . incurre d by the claimant as a result of the insurance carrier’s appeal ” (in the second set of require ments listed above) are limit ed or linked solely to those incurr ed in preva iling on the “issue[ s] on which judicial revie w is soug ht by the insurance car rier” (in the third set of require ments). In Manbec k’s view, the ph ra s e “ i

f t h e claimant preva ils on an issue on which judicial revie w is soug ht” is the predic ate for the award o f att orney s’ fee s under subsection (c) , while “re asonable and nece ssary

11attorney ’s fees .

. . incurre d by the claimant a s a re sult of the insurance car rier’ s appea l” describes the fees t hat m ay be awarde d once that predic ate is met. And fees “i n cu rr ed

. . . as a result of the insurance car

rier’ s appea l,” Manbec k further sug g ests, denotes any that can be said to “re sult from” the car rier’ s suit, which would exten d b ey o n d t h ose the claimant incurs in preva iling on the

car rier’ s issues to include those incurr ed in litigating the claimant’ s entitlement to attorney s’ fees. I n further support of that conce pt, Manbec k cites Texas case s that have construed chapte r 38 of the Civil Practi ce an d R emedies Code to allow rec overy of attorney s’ fee s incurre d in disputes over

a party ’s entitlement to att orney s’ fee s under the statute, as well as a number of fede ral case s 3 approvingsimil ar a

war ds of “f

ees f or fe es” unde r the U.S. Code. 4 Although the structure and wording of subsection (c) ’s first sentenc e might otherwis e prese nt a close question as to whether the L eg islature intended to limit claimants ’ at t o rney s’ fee

rec overie s solely to those incurre d in preva iling on issues appea led by the car ri er , we b eli eve the provision ’s s econd sentenc e plainly answe rs that question. I n the second sentenc e, as previously noted, the L eg islature provide d:

I f the car rier appea ls multiple issues and the claimant preva ils on some, but not all, of the issues appea led, the court shal l ap p o rt i o n and awa rd fee s to the claimant’s attorney o n l y for the issues on which the claimant preva ils. I n making that apportionment, the c ourt shall consider the fac tors presc ribed by Subsection (d).

See, e.g. , Bec kstrom v. Gilmore , 886 S.W .2d 845, 847 (Tex. App.—Eastland 1994, 3 writ denied)

. See, e.g. , INS v. Jean , 496 U.S. 154, 163-64 (1990) (allowing rec overy o f fe es fo r fe es 4 under 28 U .S.C. § 2412(d)(1)(A ) (2011) ). 12Tex. L ab. Code Ann. § 408.221(c)

. The “ issues” that a c arr ier would “ appea l” under the meaning of subsection (c) , as previously sug g ested, would not include a cla i m an t ’s u ltimate entitlement
to attorney s’ fe es under

that provision. Thus, by limit ing c laimants’ entitlement to attorney s’ fee s solely to those incurre d in connec tion with the “issues” “appe al ed ” by the car rier on which the claimant preva iled, the L eg islature in the second sentenc e of subsection (c) nece ssarily prec luded the awa rd of attorney s’ fee s incurre d by claimants solely in pursuit of fee s otherwise authorized by that provision. And this lang uag e, further more, sheds light on the nature of “fe es . . . incurre d by the claimant as a result o f t h e i n s uranc e car rier’ s appea l” that the L eg islature contemplated in subsection (c) ’s first sentenc e. Reading subsection (c) as a whole, we conclude that the L eg islature

nece ssarily inten d ed to authorize claimants to rec over attorney s’ fee s incurre d in preva iling on the issues on which the car rier soug ht judicial revie w, but not fee s incurre d in pursuit of those fee s. See Harris County Hosp. Dist. v. Tomball Reg’l Hosp. , 283 S.W .3d 838, 842 (Tex. 2 0 0 7 ) (“ W e deter mine leg islative intent from the statute as a whole and not from is olated portions.”) ; see also Vega-G arcia , 223 S.W .3d at 769-70.

Manbec k sug g ests that this construction of subsection (c) y ields an absurdity that the L eg islature could not possibly have intended. Unless car riers are held liable for the attorney s’ fee s claimants expend in litigating their entitlement to attorney s’ fee s under subsect i o n (c ), Manbec k insists , car

riers will have incentives to delay and obstruct claimants’ rec overie s of those fee s to run up claimant’s leg al expenses, reduc e or eliminate the value of their potential fee rec overy , and g ain

coer cive settlement lever ag e. Such a result, Manbec k complains, would subvert the L eg islature’s manifest intent in subsectio n (c ) t o awa rd attorney s’ fee s to claimants when car riers seek judicial

13re view and lose. We cannot ag ree that any potential for the sharp tactics Manbec k decri es b el i es

the leg islative intent we have asce rtained from the words the L eg islature has chosen. Although we should not lightly p re s u m e t hat the L eg islature has done a useless act, see DeQue en , 325 S.W .3d
at 637, our construction of subsection (c) plainly does not deprive it of any eff ect or opera

tion—and, in any event, t h e s t at u t o ry text controls. See id. at 638. Nor can we assume that the L eg islature did not intend to balance the respe ctive interests of claimants, ca rrier s, and employ ers in pre cisely this way . See Mid-Century Ins. Co. v. Texas W orkers’ Comp. Comm’n , 187 S.W .3 d 7 54, 758 (Tex. App.—Austin 2006, no pet.) (citing Texas W orkers’ Comp. Comm’n v. G arcia , 893 S.W .2d 504, 521 (Tex. 1995) (obser ving that “the leg islature

. . . car efully balanc ed the competing interests of injured employ ees, employ ers, and insurance car ri er s in an attempt to cre ate a viable compensa tion sy stem, all within constitutional limit ations”). A primary leg islative g oal underlying
t h e 1989 Workers’ Compensation Act was to reduc e the costs and ineffic iencies of litigation as

a means of resolving disputes in the worke rs’ compensa tion sy stem. See Garcia , 893 S.W .2d at 512- 13, 515, 533 (desc ribing how L eg islature soug ht to reduc e delay and costs associate d with de novo trials under prior act throug h, among other t h i n g s, g reater relianc e on administrative proce eding s and strong er regulation of attorney s’ fee awards); see also Transcontinental Ins. Co. v. Crump , No. 09-0005, 53 Tex. Sup. J

. 1124, 2010 Tex. L EXI S 616 at * 5 8 -5 9 n.2 (Tex. Aug

. 27, 2010) (Johns on, J ., concur

ring ) (“The 1989 ref

ormation of the T ex as wo rk ers’ compensa tion sy stem attempted to minimi ze controve rsy and litigation, in part by instit uting a multi-level administrative dispute resolution.”). Especia lly g iven this policy context, it is not inconce ivable that the L eg islature intended to strike a balanc e in subsection (c) by g ranting claimants a limit ed ability to rec over fee s

14incurre d in defe ating car rier’ s suits for judicial revie w, there by indemnify ing the m to some ex tent and deter ring car riers somewhat from pursuing suits that lack merit, while also attempting to limi t incentives for claimants or their lawy ers to pursue protrac ted satellite litigation over attorney s’ fee s. We c onclude that Manbec k’s complaints about potential litigation tactics by car riers ultimately lie with the policy choice s the L eg islature has made in subsection (c) , and are proper ly direc ted to that branc h of g overnme nt r ather than the judiciar y . See D eQue en , 325 S.W .3d at 640 (“ But whe n the lang uag e of a statute is c lear , it is not the judicial prer og ative to g o behind or around that lang uag e throug h the g uise of construing it to rea ch what the parties or we might believe is a better result.”) ; Simmons v. Arnim , 220 S

. W

. 6 6 , 7 0 (Tex. 1920) (“Courts

. . . must take statutes as they find them.

. . . They are not the law-making body

. They are not responsible for omissions in leg islation. They are responsible for

a true and fa ir interpre tation of the written law . . . .”). We also observe that three of our sister courts have previously addre ssed s i m i l ar issues conce rning the proper construction of subsection (c) , and two have rea ched the same conclusions as we do. I n Twi n City Fire Insurance Co. v. Vega-G arcia , the Fifth Court of Appea ls deter mined that subsection (c) “cle arly limit s rec overy of attorney ’s fe es to those fe es incurre d

. . . in p re v ai l i n g o n the issue on which judicial revie w was soug ht” and there by does not authorize the awa rd of fe es i n cu rr ed in pursuing fee s. 223 S.W .3d at 769. The Four th Court of Appea ls subsequently followed the rea soning of Vega -G a rcia and held that “the ‘as a result of’ lang uag e used in section 408.221(c ) re quires the attorney ’s fe es t o have been incurred on judicial revie w of

an issue on which the claimant preva iled.” Discove r Prop. & Cas. Ins. Co. v. Tate , 298 S.W .3d 249, 260 (Tex. App.—San Antonio 2009, pet. denied)

. I n the third case , the Four teenth Court of Appea ls

15rea soned that “if the claimant succe ssfully perf orms the predic ate

—

preva iling on an issue on which the car

ri er s o ug ht judicial revie w—the claimant is entitled to attorney ’s fee s incurre d as a result o f the appea l”—and that attorney ’s fee s incurre d in pursuing an attorney ’s fee claim under subsection (c) , in the court’s vie w, wer e “a result of the appeal.” Transcontinental Ins. C o.

v. Crump , 274 S.W .3d 86 , 1 04 (Tex. App.—Houston [14t h Dist.] 2008), rev’ d on other grounds , No. 09-0005, 53 Tex. Sup. J

. 1124, 2010 Tex. L EXI S 616 (Tex. Aug

. 27, 2010). The court distinguished Vega-G arcia on the basis that “the i n s u rance car rier non-suited its judicial revie w proce eding .” Id. We ag ree with the subsequent observation in Tate (which did not involve a car rier non-suit) that Crump ’s proposed distinction based on whether the car rier had non-suited ultimately fails and that Crump is logic ally inconsistent with both Tate and Vega-G arcia

. For rea sons we have explained, however , we f ind the rea soning of Tate and Vega-G arcia more pe rsuasive. Whil e the Workers’ Compensation Act is to be “libera lly construed” in favor of the injured worke r, Kroger Co. v. Keng , 23 S.W .3d 347, 349 (Tex. 2000), a statutory awa rd of attorney s’ fee s—a depar

ture from the established “Amer ican Rule”—“‘ may not be supplied by implication but
must be provided for by the express terms of the statute in question.’” Holland v. W al-Mart Stores, Inc. , 1 S.W .3d 91, 95 (Tex. 1999) (quoting First City Bank-F armers Branch v . Guex , 677 S.W .2d 25, 30 (Tex. 1984) ). Although subsection (c) of L abor Code section 408.221 expressly authorizes

awa rds of attorney s’ fee s that worke rs’ com p en s at ion claimants incur in preva iling on issues on which car riers have soug ht judicial revie w, it does not authorize the awa rd of fee s incurre d solely in pursuing the fee s themselves. Be cause AI SD’s non-suit of its judicial-re view claim left Manbec k’s
counter claim for atto rn ey s ’ fe es as the sole rema ining issue in the case , subsection (c) did not

16authorize an aw ard f or the attorney s’ fees M anbec k incurre d from that point forwa rd. We sustain AI SD’s second issue.

Attor neys’ fees incurred prior t o non-su it

AI SD’s first issue conce des that subsection (c) of L abor Code section 408.221 would entitle Manb ec k t o “r easonable and nece ssary attorney ’s fee s as provided by Subsection (d)” that he incurred in the di strict court prior to AI SD’s non-suit. AI SD disputes, howeve r, t hat M anbec k prese nted either leg ally or fac tually sufficie nt evidenc e to support the jury ’s finding that he incurre d $36,000 in such fee s.

To establish the amount of attorney s’ fee s he incurr ed in the district court prior to AI SD’s non-suit, Manbec k relied on tes t i m o ny and documentar y evidenc e conce rning service s provided by two of his three attorney s, L ee and Stewart. The third, McClellan, was not reta ined until afte r AI SD’s non-suit, althoug h he offe red expert opinions reg ard i n g t h e rea sonablene ss and

nece ssity of L ee and Stew ar t ’s fees. L ee had repr esente d Manbec k in his proce eding s befor e the Division, a

nd was reta ined ag ain, along with Stewa rt, in e arly 2007. Manbec k prese nted evidenc e that, prior to the non-suit, L ee billed for 21.25 hours of work at an hourly rate of $300 ($6,375 total) and that Stewar

t billed for 90.25 hours at an hourly rate of $350 ($31,587.50 total), plus $1,523 in expe n ses, for an agg reg ate total of $39,485.50, an amount that exceede d the $36,000 that the j ury ultimately

awa rded. I n contending that the evidenc e was leg ally and fac tually insufficient to suppor t the

awa rd of attorney s’ fee s for L ee’ s service s, AI SD focuse s on evidenc e that L ee billed in quarte r-hour incre ments, a prac tice that could have resulted in L ee “rounding up” individual char g es by as much
17as four

teen minutes ea ch. I t asser ts that L ee may have done precisely this on as m any as eightee n

occa sions, potentially resulting in up to $1,260 in f ees being char g ed for minutes in which L ee did
not actua lly provide service s. AI SD also takes issue with L ee’ s $300 hourly rate , emphasizing that 5 the rate was twice the $150/hr rate L ee had char g ed Manbec k for L ee’ s service s in the administrative proce eding s. AI SD questions the rea sonablene ss and nece ssity of the highe r rate g iven that (1) L ee, whom the evidenc e ref

lects was a six teen- y ear lawy er with a prac tice focuse d on the administrative aspec ts of worke rs’ c ompensation claims, brought i n Stewart to assist with the trial and discove ry aspec ts of the case , (2) once in the district court, Manbec k enjoy ed advanta g es that he did not possess at the administrative level, including AI SD bear ing the burden of proof and the ability to make the 6 fac t-finder

awa re of his favora

ble outcome be fore the Division. 7 As for Stewart , AIS D p o i nts to what it contends are three occa sions in which he billed for “unnec essar

y ” trave l betwee n his office in H ouston and Austin to meet fac e-to-f ace with Manbec k (totaling $5,250) and a fourth trip in which he met with a doctor ($1,400). AI SD questions
t h e n ec essity of these fac e-to-f ace meeting s g iven L ee’ s continued involvement in the case , “the convenie nce of communications by telephone or over t h e internet,” and that neither depositions

nor trial had been schedule d at the time. AI SD also chides Stewart, a board- cer tified persona l injury attorney , for billing $350 per hour for tasks that, in AI SD’s view, wer e more appropr iate for a para leg al or secr etar

y to perf orm, such as ty

ping or sending pleading s or discovery reque sts. I t also

14 minutes x 18 = 252 minutes, which is 4.2 hours, x $300/hr.= $1,260. 5 See Tex. L ab. Code Ann. § 410.303 ( West 2006). 6 See id. §§ 410.304, .306(b) ( West 2006). 7 18criticizes the amount of time Stewart attributed to such tasks. Fo r ex ample, AI SD complains

that Stewart billed 1.0 for draf ting a reque st f

or disclosure and a total of 2.5 hours for draf ting and forwa rding Manbec k’s answe rs and counter claim. AI SD specific ally identifies a total of $3,080 of Stewart’s f

ees that it believes should have be en per formed by someone e lse for le ss money . A party challeng ing t h e leg al sufficie ncy of the evidenc e supporting an adver se finding on an issue on which an opposing party has the burden of proof will preva il if (1) there is a complete absenc e of evidenc e of a vital fac t, (2) the court is barr ed by rules of law or evidenc e from g iving weig ht to the only evidenc e offe red to pr ove a vital f act, (3) the evidenc e offe red to pr ove a vital fac t is no more than a mere scintilla, (4) the evidenc e concl u s i v ely establishes the opposite of t he vit al fact. See Cit

y of Keller v. W

ilson , 168 S.W 3d 802, 810 (Tex. 2005); King Ranch, Inc.

v. Chapman , 118 S.W .3d 742, 751 (T ex . 2 0 0 3 ). “More than a scintilla of evidenc e exis ts when the evidenc e supporting the finding , as a whole, ‘ would enable rea sonable and fair- minded people
t o d iffer in their conclusions.’” Merre ll Dow Pharms., Inc. v. Havne r , 953 S.W .2d 706, 711 (Tex. 1997) (quoting Burroughs W ellcome Co. v. Crye , 907 S.W .2d 497, 499 (Tex. 1995) (interna l q u otes omitted)). But if the evidenc e is so weak that it does no more than cre ate a mere surm i s e

or suspicion of its exis tence , its leg al eff ect is that it is no evidenc e. Hayne s & B oone v. Bowser Bouldin, Lt d. , 896 S.W .2d 179, 182 (Tex. 1995).

When conducting a leg al-suff iciency revie w, we view the evidenc e in the light most favor able t o t h e trial court’s finding s, “cr editing favor able evidenc e if rea sonable jurors could, and disreg arding contra

ry evidenc e unless rea sonable jurors could not.” City of Keller , 168 S.W .3d
at 807. We indulge ever y rea sonable infere nce that would support the trial court’s findi ng s. Id.

19at 822. “The final test for leg al sufficie ncy must alway s be whether the evidenc e at t ri al wo u l d

enable rea sonable a

nd fair- minded people to re ach the verdic t under re view.” Id. at 827. When r eviewing a jury verdic t to deter mine the fa ctual sufficie ncy of the evidenc e, courts must consider and weig h all the evidenc e, and s et as i d e t h e verdic t only if it is so contra ry t o t h e o v erwhelming weig ht of the evidenc e as to be clea rly wrong and unjust. Cain v. Ba i n , 709 S.W .2d 175, 176 (Tex. 1986).

As the Texas S u p reme Court has continued to emphasize, “[i] n g ener al, the

rea sonablene ss of statutory attorney ’s fee s is a jury question.” Crump , 2010 Tex. L EXI S 616 at *54 (quoting City of Garland v. Dallas Morni n g N ew s , 22 S.W .3d 351, 367 (Tex. 2000) (interna l quotation marks omitted)). The char g e instructed the jury that, when deter mining the amount of “a

rea sonable fee for the nece ssary service s” of Manbec k’s attorney s, it wa s to consider seven fac tors that prec isely trac ked those listed in subsection (d) of section 408.221. Consequently , to deter mine whether leg ally and fac tually sufficie nt evidenc e supported the awa rd of pre- non-suit attorney s ’ fee s,

we m u s t ev al uate the evidenc e in light of those seven fac tors. See Golden Eagle Archery , Inc.

v. Jack son , 116 S.W .3d 757, 762 (Tex. 2003) (cha rg e as submitt ed is g ener ally “starting point” for fac tual-suffic iency revie w); Osterberg v. Pec a , 12 S.W .3d 31, 55 (Tex. 2000) (same is true for leg alsufficie ncy revie w). Howeve r, the ultimate inquiry is whether the fee s awa rded wer e rea son able

an d nece ssary . See Tex. L ab. Code Ann.§ 408.221(c) ; Arthur Andersen , 945 S.W .2d at 818-1 9 ; see also Tate , 298 S.W .3d at 255-56.

20Experience and ability of the attorn eys AI SD does not appea

r to question that both L ee and Stewart are experience d and able attorney s. L ee testified that he has been licensed to prac tice in Texas for six teen y ear s, and that his prac tice has be en devote d primarily to worker s’ compensation case s for a t least thirteen year s, the last ten of which have been in Austin. He further indicated that he has handled over 1,000 worke rs’ compensa tion claims, mostly at the administrative level. Stewart testified that he has been licensed

as an attorney for over twenty y ear s, is board cer tified in persona l injury law, and had tried seven worke rs’ compensation case s in Travis Count y . Although S t ew ar t acknowledg ed that he was not board cer tified in worke rs’ compensation law, he explained that he was ineligible at the prese nt time beca use he had serve d on that s p ec i al t y ’s orig inal exam commission and for a few y ear s helped write the e x am. The fee custom arily charged in th e locality for sim ilar legal services The jury hear d conflicting evidenc e reg arding the rea sonable hourly rate char g ed by worke rs’ compensation attorney s prepa ring case s for trial in district court. AI SD’s trial counsel, J ohnson, testified that the rea sonable hourly rate for worke rs’ compensa tion attorney s was betwee n $100 and $250 per hour, based on his experience in the field and what he knew about other attorney s handling worke rs’ compensation claims. Howeve r, he acknow ledg ed t hat he had never hear d of 8

an attorney billing at less than $250 for work in district court. Manbec k, by co n t ra s t, prese nted evidenc e that the aver ag e billing rate for attorney share holders in Austin in 2008 was $329 per hour,

J ohns o n d i d n o t , h o wever, purport to testify as an expert, as he had not been desig nated 8 as one. 21and that rate s near o r in excess of the aver ag e wer e customarily char g ed in litigating worke rs’

compensa tion claims in district court. McClellan added that, in fac t, some defe nse attorney s char g e over

$500 per hour

. As noted, L ee billed his time at a rate of $300 per

hour and Stewa

rt at $350 per hour

.
Nove lty and difficulty of the question s involved The jury also hear d conflicting evidenc e reg arding the rela tive novelty and difficulty of the questions prese nted by the extent-of-injury dispute. Whil e AI SD’s J ohnson dismiss ed the dispute as “a plain vanilla Workers’ Comp case ,” M an beck’ s witnesses depicted it as involving complex or unique medical and leg al issues. L ee and Stewart testified that the extent-of-injury issues in this case wer e com p l i ca t ed by the fac t that, in addition to seeking compensa tion for his initial shoulder injury , Manbec k soug ht cover ag e for injuries—rig ht shoulder impingeme nt sy ndrome and interver tebra l disc d am age —incurre d while he was rec eiving phy sical thera py for his shoulder. Stewart testified that he had to find and reta in two experts with differ ent specia lties, one to discuss the additional damag e to Manbec k’s shoulder and another doctor to testify reg arding the ag g ravation of Manbe ck’s ba ck injury

. The skill requi red to perform th e legal serv ices properly Simi larly , the jury hear d competing co n t entions reg arding the rela tive skill level require d of Manbec k’s attorney s to preva il. AI SD emphasized the proce dural advanta g es that Manbec k possessed in the district court and that, unlike the ty pical per s o n al injury case , Manbec k would not be require d to prove damag es, per se. J ohnson also maintained essentially that

22beca

use Stewart was well qualified, no other attorney s neede d to be working on the case . I n addition
to evidenc e conce rning the relative complexit y of the leg al issues prese nted, Manbec k prese nted evidenc e that while L ee and Stewart wer e eac h i m m i n en tly qualified to handle worke rs’ compensa tion case s, th e tw o c o mp le mented eac h other, with Stewart contributing his more extensive experience and skills in district court litigation and L ee continuing to assist with cer tain tasks so as to reduc e Stewar

t’s overa ll work load.

Am ount in contr oversy

and benefits secured for the claiman t AI SD boldly claims that “ther e is no evidenc e in this rec ord that Manbec k’s attorney s

secur ed any benef

it for him as the result of this litigation.” Manbec k responds that his attorney s

secur ed benef

its that included preve nting AI SD from obtaining a defa ult judgme nt ag ainst him and by g uara nteeing that AI SD would be liable for any future rea sonable and nece ssary medical car e for Manbec k’s compen s ab l e i n jury , which extended to include the rig ht shoulder impingeme nt and lumbar injury

. Manbec k’s attorney s testified to the se benef its, and L ee testified without objec tion that Manbec k was likely to have problems with his back in the future. AI SD did not prese nt contra ry evidenc e, althoug h it downplay s such future benef its as merely

“theor etical.”

Tim e and labor required AI SD’s complaints reg arding L ee and Stewart’s billings, as previously summarized,

are addre ssed primarily to the “time and labor require d” fac tor. I n response to AI SD’s contentions reg arding his “doubled” hourly rate , L ee explai n ed t h at t he $150 per hour rate he char g es for repr esentation befor e the Division is a function of L abor C ode section 408.221’s cap on

23attorney s’ fee s to twenty -five perc ent of a p l ai n t i ff ’s rec overy . As for the possibili ty that L ee’ s

billing in fiftee n-minute incre ments resulted in some “over char g es,” AI SD ref ers us to no authority holding that billing by this method re n d er s t h e ultimate fee char g ed per se unrea sonable. See Lewallen v. City of Beaumont , No. 1:05-CV-733-TH , 200 9 U. S

. Di s t

. L EXI S 62503 at *13 (E.D. Tex. J ul y 2 0 , 2 0 09) (whe re defe ndant challeng ed use of fiftee n-minute billing incre ments, observing that no fede ra l o r l ocal rule disallowed them and that the ultimate inquiry rema ins whether the fee s are rea sonable), aff’d in part and rev’ d and rendere d in par t o n o t h er g r o unds , No. 09-40337 c/w 09-4082, 2010 U.S. App. L EXI S 17613 (5th Cir. Aug

. 23, 2010). And, with respe ct to L ee’ s having continued to pa rticipate in the repr esenta tion, L ee te stified that his rapport with Manbec k and familiarity with what transpire d at the administrative level made it rea sonable for him to remain on the ca se and r eview the pleading s and discover y . More g ener ally , we conclude that AI SD’s complaints with L ee and Stewart’s char g es

are of a nature and conce rn amounts that, when considere d in the context of the fore g oing evidenc e and section 408.221, subsection (d)’ s fac tors as a whole, g o to the weig ht of the evidenc e reg arding

a rea sonable amount of time to bill or a rea sonable rate to char g e—and, as such, are matters for the jury to decide

. See Priestwood v. Settle , No. 03-07-00111- CV, 2008 Tex. App. L EXI S 1458 at *22- 23 (Tex. App.—Austin 2008, pet. den i ed). We also observe that Stewart and McClellan opined that b o t h L ee an d Stewart’s time and labor was rea sonable. I n sum, we cannot conclude that no

rea sonable fa ct finder

could have found that Manbe ck incur red at least $36,000 in rea sonable fe es for the nece ssary service s of L ee and S tewar t prior to AI SD’s non-suit, nor can we conclude the
amount of the awa

rd is so contra

ry to the overw helming we i gh t o f the evidenc e as to be clea rly

24wrong and manifestly unjust. Cf. Dean Foods Co. v. Anderson , 178 S. W

. 3 d 449, 456

(Tex. App.—Amar illo 2005, pet. denied) (aw arding claimant $100,167.86 in attorney s’ fee s wher e

car rier non-suited its claims one y ear afte r filing suit for judicial revie w challeng ing Commi ssion’s finding of compensa

ble injury); Texas Mut. Ins. Co. v. Durst , No. 04-07-00862- CV, 2009 Tex. App. L EXI S 1266 at *14 (Tex. App.—San Antonio Fe b. 25, 2009, no pet.) (aw ar ding $160,000 in attorney s’ fee s for trial on merits wher e five attorney s char g ed from $235 per hour to $395 per hour). Acc ording ly , we ove rrule the AI SD’s first issue.

CONCLUSION Be cause they lack ei t h er a statutory or contra ctual basis, we must reve rse the district court’s judgme nt awa rd of $17,415 for attorney s’ fees Manbec k incurre d at the trial level following AI SD’s non-suit, as well as its awa rds of conting ent appellate attorney s’ fee s, and rende r judgme nt that Manbec k take nothing on those claims. Howeve r, ha v i n g conclude d that Manbec k prese nted leg ally and fac tually sufficie nt evidenc e to support an awa rd of $36,000 for the rea sonable and nece ssary trial-leve l attorney s’ fee s he incurre d prior to AI SD’s non-suit, we aff irm the judgme nt

awa rd of those f

ees.

__________________________________________ Bob Pembe rton, J ustice Be fore J ustices Pury ear , Pemberton and Rose Affir med in part; Rever sed and Rende red in pa rt Filed: Mar ch 23, 2011
25