See Tex. L ab. Code Ann. § 402.001 ( West S upp. 2005). 1 

### TEXA S C OU R T OF A PPEAL S, THIR D DIST R ICT , AT AU STIN

NO. 03-05-00494- CV

M id- Ce nt ur y I nsur anc e Co m pany , A ppe lla nt

v. Texas Workers’ Com pensation Comm ission , Appellee

F ROM THE DISTRICT CO URT OF TRAVIS COUNTY , 261ST JUDICI AL DISTRICT NO. GN400059 , HO NORAB LE LORA J. LIVINGSTO N, JUDGE PRESIDI NG

O P I N I O N
I n 2001, appellee , the Texas Workers’ Compensation Comm ission (now the Texas De pa rtme nt o f I

ns ur anc e , D ivi sio n o f Wo rk e rs ’ C omp e ns a tio n) (t he Di vis ion ), a me nd e d it s 1 administrative rules to require that lifetime income benefits under w orker s’ compensation (L I Bs) be paid retroa ctively from the orig inal date of disability
. See 26 Tex. Reg. 10933 ( 2001) (c odified at 28 Tex . Ad mi n. Co de § 13 1. 1(b ) (200 1))
. Co nt end in g th at th e ame nd ed rul e mad e it li abl e for L I Bs
mon ths or

e ve n y e ars be fo re so me inj ur e d e mpl oy ees beco me elig ibl e to r e c e ive the be ne fi ts, appellant Mid-Century

I nsuranc e C o mp a

ny ( M id

- Ce ntu

r y ) s o u ght a dec laration that this rule e x cee ds the Division’s statutory

power s and is thus invalid. See Tex. Civ. Prac. & Rem. Code Ann. § 37.0042

(We st 1 99 7) . A ft e r a be nc h tr ia l, t he dis tr ic t c ourt

re nd e re d ju dg me nt a g a ins t Mi d- Ce ntu ry . B e c a us e
we c onclude that the r

ule exceeds the Division’s statutory authority , we w i l l reverse a nd rende r j u d g m e n tf

o r M i d

- C e n tu r

y.
BACK GR OUND Workers’ com pensation an d lif etim e incom e benefits The Te x as Workers’ Compensation A ct (the Act) pr ovides four se parate categ ories of bene fits for injured e mploy ees: medic al, income, de ath, a n d b u rial. See Tex. L ab. Code Ann. § 401.011(5) ( West 1996). The categ o ry of income be nefits is itself divided into four parts: (1) temporar y income bene fits; (2) impairment income be nefits; (3) suppleme ntal income bene fits; and (4) L I Bs. See ge nerally id. §§ 40 8. 10 1- .1 62 (We st 19 96 & Sup p. 20 05 ). Th e se fo ur ty pe s o f i nc ome benef its are distinct from one another and ar e discussed in sepa rate subchapte rs of the A ct. Texas Gen. I ndem. Co. v. Tex as W

orkers’ Comp. Comm’n , 36 S.W .3d 635, 640 (Tex. App.—Austin 2003, no pet.). T h e l egi s l at u re p ro v i d ed t h at L I Bs ar e e qu al t o 7 5 p er ce n to f t h e e mp l o y ee ’s av er age
wee kly wag e, with t hree -per cent annual i ncre ases, and are “paid until the death of the e mploy ee.” Tex. L ab. Code Ann. § 408.161( a) & (c)
. Such benef its a re pa y able f or ce rtain enume rate d classes of se ve re inj ur ie s tha t ar e pe rm ane nt in na tur e , inc lud ing tot a l and pe rm ane nt los s o f s ig ht i n b oth ey es; loss of both fee t, both hands, or one f oot and one hand; a spinal injury that results in permane nt and complete para ly sis of both arms, both leg s, or one a rm and one leg ; and third-deg ree burns that
cover at l east 40 perc ent of the body and require gr afting or cove r the majority of either both handsThe Te x as Reg ister, althoug h listi ng sever al intere sted parties that commented on the r ule, 2 did no t id e nti fy

wh ic h part

y ma de e a c h co mme nt. Th e pa rt ie s tha t re c omm e nd e d ch ang e s to the ru le wer e t h e Texas A&M U niversity Sy stem, Absolute Danc e Studio, and Texas Mutual I nsuranc e Company
. Id . at 10933. 3 or one ha nd and the f

ace . Id . § 408.161(a) . The leg islature fur ther provide d t hat for pur poses of deter mining elig ibilit y

for L I Bs, “ the total and per manent loss of use of

a body part is the loss of that body part.” Id . § 408.161(b).
Rule 131.1 I n 20 01 , the Di vis ion a me nd e d ru le 13 1. 1 to p ro vid e , in re le va nt p art , th a t “ [l]if

e tim e income bene fits beg in to accr ue as pr ovided by

the Texas Workers’ Compensa tion Act (the Ac t), § 408.082, and ar e payable retroa ctively from the date of disability .” See 26 Tex. Reg. 10933 ( 2001) (codifie d at 28 Tex. Admin. Code § 131.1(b) (2001)) . When m ak i n g this chang e, the Division
re je c te d s ug g e sti on s th a t L I B s sh ou ld in st ead bec ome pa y a ble on ly a ft e r t he e mpl oy e e a c tua lly b e c o me s e li g ib le to r e ceive L I Bs. S ee 26 Tex . R eg. 10 93 3, 10 93 4 (2 00 1). W it h m any L I Bqualifying c ompensable injuries, the date of L I B e ligibility and disability are the same, such a s when
an empl oy ee lose s an ey e and the loss impacts their ear ning c apac ity . Howeve r, amongother comments to the proposed r ule was a

n observation that some compensable injuries may not immediately be severe enoug h to qualify for L I Bs, but would qualify at a later point in time ( e.g. , an inj ur y to an e mpl oy e e ’s ha

nd s th a t g ra du a lly

de te ri or a te s unti l he or

sh e c omp le te ly

and pe rm ane ntl y loses their use). Id
. I t wa s su g g e ste d that the inj ur e d e mpl oy e e c ou ld dr aw oth e r fo rm s o f w or ke rs ’ 2
com pen s a t i o n in com e ben efi ts , an d ev en re tu rn t o wo rk, befo re t he i nj ury wor sen ed i nt o an L I B-4

qualifying c ondition mont hs or eve n y ear s later, y et would be e ntitled to L I Bs f or the e ntire per iod
s in c e th e o r ig in a l d is a

b il it y . Id
. The Division declined to modify rule 131.1’s pr ovision making L I Bs r etroa ctive, althoug h it did st ate that a ny previous amount alr eady

paid by car rier a s other ty

pes of income be nefits would be r edesig nated as L I Bs and cr edited ag ainst the total L I Bs then retroa ctively

due. Id
. On J an u ary

8 , 2 0 0 4 , M i d -C en tu ry

fi l ed a s u i taga i n s tt h e D i v i s i o ns ee k i n g a decl arat ory

ju dgmen t t hat rul e 13 1. 1 b e decl aredin val idto th e ex ten t i t requ ir es ca rri ers to pay L I Bs
re tr oa c tiv e ly

fr om t he da te of an e mpl oy e e ’s dis a

bil ity rathe r t ha n f ro m th e date the e mpl oy e e fi rs t qualified for

those bene fits. On J une 20, 2005, af t er a b ench trial, the district court re ndere d judgme nt in favor of

the Division. This appeal followe d.

DI SCU SSIO N Mid-C en t ury

prese nts one issue on appe al, contendingthat the Division ex cee ded its statutory

authority in adopting r

ule 131.1(b). We a g ree . Stand ard of review

Th e Di vis ion may e xer c ise on ly tho se po we rs that the le g isl a tur e c on fe rs up on it i n clea r and e x p ress languag e and c annot exercise w hat re ally amounts to a new or

additional power for the pur

pose of a dmini s t ra t i v e expediency
. Texas Natural Res. Conservation Comm’n v. Lakeshore Util. Co. , 1 64 S.W. 3d 36 8, 37 7 ( Te x. 20 05 ); Public Util. Comm’n v. Cit y Pub. Se rv. Bd. of S an An ton io , 53 S.W .3d 310, 316 (Tex. 2001). This is beca use t he Divis ion is a creature of the leg islature with no inhere nt authority of its own. Lakeshore Util. Co. , 164 S.W .3d at 377. Howe ver,5

“[w]hen the L eg islature expressly confe rs a powe r on an ag ency , it a lso impl iedly intends that the ag ency have w hateve r powers are rea sonably nece ssary to fulfill its express functions or duties.” Id
. at 378. An ag ency

cre ated to ce ntralize expertise in a ce rtain re g ulatory are a is ordinar ily

“g iven a larg e deg ree of latitude in the methods it use s to acc omplish i ts reg ulatory function.” Texas Mun. Power Agenc

y v. P ublic Util. Comm’n , 15 0 S .W. 3d 57 9, 58 6 ( Te x. Ap p. —A us tin 20 04 , p e t. g ra nte d). Nonethe le ss, a n a g e nc y may no t, i n th e g uis e of

imp lie d p ow e rs , e xer c ise wh a t is eff ectively a new power , or a power contra

ry to statute, on the t heory that such exercise is ex pedient for the a g ency ’s purpose, City of Austi n v. S o u t h western Bell Tel. Co. , 9 2 S. W. 3 d 4 3 4 , 4 4 1 ( T e x. 2002), nor may

it contrave ne spec ific statutory lang uag e, run counter to the g ener al objectives of the statute, or im pose additi onal burdens, conditions, or restrictions in excess of or inconsistent with the rele vant statutory

prov i s i o n s . State v. Public Util. Comm’n of Tex. , 1 3 1 S. W. 3 d 3 1 4 , 3 2 1 ( T e x. App.—Austin 2004, pet. denied)
.

I n a fa cial cha lleng e to a r

ule, we do not c onsider the mer its of the Division’s rule on
a ca se-by -ca se basis. City of Garland v. Public Util. Comm’n of Tex., 1 6 5 S. W. 3 d 8 1 4 , 8 1 9 ( T e x. Ap p. —A us tin

20 05 , p e t. f

ile d) . Rathe r, we c on sid e r w he the r t he ru le: (1) c on tr a ve ne s sp e c if ic statutory lang uag e; (2) r

uns counter to the gene ral objectives of t he st atute; or (3) imposes additional burd e ns , co nd iti on s, or

re str ic tio ns in e xce ss o f o r i nc on sis te nt w iththe re le va nt s ta tut or y pr ov isi on s. Public Util. Comm’n of Tex., 131 S.W .3d at 321.

Statutory construction presents a question of l aw that we revie w de novo
. Johnson v. City of Fort W

orth, 774 S.W .2d 653, 656 (Tex. 1989). We construe statutory provisions in order to asce rtain and e ffe ctuate le g islative intent. Texas Dep’ t of Protective& Regulatory Serv s. v. Me ga6

Child C are, Inc ., 145 S.W .3d 170, 176 (Tex. 2004). I n as ce rtaining leg islative intent, we may consider the evil soug ht to be reme died, t he leg islative history , and the c onsequenc es of a particula r construction. See Liberty Mut. Ins. Co. v. Garrison Contractors, Inc., 9 6 6 S. W. 2 d 4 8 2 , 4 8 4 ( T e x. 1 9 9 8 )
. F u rt h e r , w e r e a d e v e r y w o r d , p h r a s e , an d e xp r e s s i o n i n a s t a tu t e a s i f i t w e r e de lib e ra te ly chosen a nd presume t h e wor ds excluded from the statute a re done so purposefully
. See G ables Realty L td. P’ship v. T

ravis Cent. Appraisal Dist., 81 S.W .3d 869, 873 (Tex. App.—Austin 2002, pet. d e n ie d )
. I n th e c a s e o f th e Wo r k e r s ’ Co mp e n s a ti o n A c t, th is is n o t o n ly a p r e s u mp ti o n : the leg islature, in fa ct, caref

ully balanc ed the c ompeting inter ests of injured e mploy ees, e mploy ers, a nd insurance car

ri er s i n an att empt to cre ate a viable compe nsation sy stem, all within constitut ional limit ations. Se e Te

x as W or k e rs’ Com p. Com m’n v . G ar c ia , 893 S.W .2d 504, 521 (Tex. 1995). Gene rally , we will ac cept the wo rd s u s ed in a statute a ccor ding to their ordinary meaning , unless g iven a specific statutory definition. City

of A us tin , 9 2 S. W.3 d at 44 2; s e e als o T e x. Go v’ t Co de Ann. § 3 11 .0 11 (a ) ( Wes t 20 05 ) ( pr ov idi ngthat “ wo rd s a nd ph ra se s sh ou ld b e re a d in context and construed a cco rding to the rules of g rammar and usag e”) . Finally , while we ha ve acknow ledg ed that an ag ency ’s construction of a statute within its are a of e x pertise should be g iven serious consider ation, this ax iom applies onl y as l ong as t he construction is reasona ble and doe s not contra dict the statute’s plain languag e. Se e AT& T Com mu nic ati on s of Tex . L.P. v . S ou thw este rn Be ll T el. Co. , N o . 0 3

- 0 7 8 9 , s li p o p in io n a t 1 9 , 2 0 0 6 T e x. L E X I S 9 3 , a t * 3 3

- 3 4 ( T e x. Ja n. 27, 2006) (stating that an age ncy is entitled to “some defer ence ” in construingstatutes aff ectingits jurisdi ction
as l o n g as t h e c o n s t ru ct i o ni s re as o n ab l e); Southwestern Lif e Ins. Co. v. M

ontemayor , 24 S.W .3d 581,7

58 5 (T e x. Ap p. —A us tin

20 00 , p e t. d e nie d) ; see also Texas Gen. Indem

. Co. v. Eisler , 981 S.W .2d 744, 747 n.2 (Tex. App.—Houston [1s t Dist.] 1998, no pet.). Appli cation L abor c ode sec tion 408.161 addresse s L I Bs. In its corre sp o n ding pr ovisions g overningthe three other ty pes of income bene fi t s , the leg islature stated a specific date on whic h
eac h class of inc ome bene fit would become pay able. See Tex. L ab. C ode Ann. §§ 408.082 & .101 (employee e nt i t l edt o t em p o ra ry i n co m e b en ef

i t s b egi n n i n g o nei gh t h d ay o f d i s ab i l i t y

an d continuing until e mp lo y e e r e a c h e s maxim u m m e d ic a l i mp r o v e me n t) , . 1 2 1 ( e mp lo y e e e n ti tl e d to im p a ir ment income bene fits from day

afte r date employ ee r eac hes maxim um medical improvement until earlier of employ ee’ s death or e x piration of period based on pe rce ntag e of impairme nt), .142 (employ ee entitle d to s u

p p le me n ta l in c o me b e n e f it s if h e o r s h e me e ts c e rta in qu a li f y in g c o n d it ions upon expiration of impairment income bene fits). I n section 408.161, t he leg islature stated simply that “lifetime income benef

its are pa id until t he death of the employ ee for ” the se ven categ ories of se vere , perma nent injuries enumer ated in that sec tion. Id
. § 408.161 (empha sis added) . Whil e seve ral of thes e c a te g o r ie s in c lu d e in ju r ie s th a t w o u ld o b v io u s ly an d im me d iate ly qu a li f y an e mp lo y e e for lifetime income be nefits, id. § 408.161(a) (1)- (4), ( 7), others e mbrac e qualify ing injurious conditions that co u l d be deg ener ative or slowe r-de veloping
. Id . § 40 8. 16 1( a )( 5) (s pin a l in jur ie s r e su lti ngin p ar a ly s is ) , ( b ) ( to ta l a

n d p e r ma n e n t l o s s o f u s e o f b o dy p art c o n s ti tute s lo s s o f th a t bo dy p art)
. We
mus t a ssume that th e le g i s l a t u r e c o nt e mpl a te d th e pr os pe c t of the se slo we r- de ve lop ingbu t ul tim a te ly L I B- qualifying c onditions when cra fting the statute. Se e Ga ble s R e alt yLtd . P ’s hip , 81 S.W .3d at8

873 (s tati n g th a t e v e r

y w o r d , p h r a s e , an d e xp r e s s io n in s tatute s h o u ld b e r e a d a s if it were deliberately

chosen)
. The Division char acte rizes section 408.161 as “silent” conce rning the time at which L I Bs be come pa

y able. We disag ree . The leg islature spec ifically rese rved L I Bs f

or seve n e n u me r a ted
c a te g or ie s o f i nju

ri ou s c on dit ion s th a t in c lud e bo th i mmediat ely qu a lif y inginj ur ie s and

tho se
e vo lvi ngor

de te ri or a tin g ov e r t ime . I t fu rt he r pr ov ide d that L I B s are pa y a ble “ fo r” tho se c on dit ion s. We conclude that the leg islat u re i n t en d ed for L I Bs to bec ome pay able if a nd when a

n employ ee become s elig ible to rec eive them—not bef ore. An employ ee is e ligible to re ceive L I Bs on the date that employ ee suf fer s from one of t he co nd it io ns sp eci fi ed i n s e cti on 40 8. 16 1. S ect io n 4 08 .1 61 do es n ot perm it pay men t o f L I Bs pr ior to t hat date . O nc e an e mpl oy e e is ad jud ic a te d eli g ibl e to re c e ive L I B s, ho we ve r, L I B s sh ou ld be paid r etroa ctively

to the date the e mploy ee f irst became elig ible. No thi nge lse wh e re in the Ac t sug g e sts a c on tr ary int e nt. Th e Di vis ion

re lie s c hie fl y up on se c tio n 4 08 .0 82 of

the Ac t, w hic h p ro vid e s in re le va nt p art :
ACCRUALOF RI GHT TO I NCOME BENEF I TS (a) I ncome be nefits may not be paid under

this subti tle for a

n injury that does not result in disability

for at least one we ek. (b ) I f t he dis a bil ity con tinue s f

or lon g e r t ha n o ne we e k, we e kly

inc ome be ne fi ts be g in t o a c c ru e on

the eighthda

y a ft e r t he date of the inj ur y . I f t he dis a bil ity do es n o t b egin at once afte r the injury occur s or within eig ht day s of the occur renc e but does re sult subsequently , wee kly income benefits acc rue on the eig hth day

afte r the date on which the disa bility beg an.Th e c ourt a lso a c kn ow le dg e d th e a xiom that c ourt s sh ou ld giv e se ri ou s c on sid e ra tio n to 3 an ag ency construction of a

statute within the ag ency ’s ar ea of expertise. See Tex as Gen. Inde m. Co. v. Eisler , 981 S.W .2d 744, 747 n.2 (Tex. App.—Houston [1s t Dist.] 1998, no pet.). 9 (c ) I f the dis a

bil ity c on tin

ue s fo r fo ur we e ks or lon g e r a ft e r the dat e it begin s, c omp e ns a tio n s ha ll b e c omp ute d f ro m th e date the dis a

bil ity be g ins
. Tex. L ab. Code Ann. § 408.82. We conclude, for two principal reasons, that sec tion 408.082 does not addre ss when L I Bs be come pa y able. F ir st, se c tio n 4 08 .0 82 ha s b e e n he ld to a pp ly so le ly to the te mpo ra ry inc ome be ne fi ts g overne d by

section 408.101, not other ty pes of income benef

its. See E isler , 981 S.W .2d at 746-47. The Eisler

c ourt a c kn ow le dg e d th at se c tio n 4 08 .0 82 re fe re nc e s “ inc ome be ne fi ts” (w hic h w ou ld literally include not only

temporar y income bene fits, but impairme nt inc ome bene fits, supplemental income bene fits, and L I Bs) and appea rs in a subsection titled “ I ncome Be nefits in Gene ral.” Id. ; see Tex. L ab. Code Ann. § 401.011( 25) (def ining “income be nefit” a s “a pa y ment made to an e mploy ee for a compensa

ble injury ” that is not “a medical be nefit, death benef it, or burial bene fit.”). 3 No ne the le ss, the c ou rtcon clu dedth at s ect io n 4 08 .0 82 cou ldno t ap pl y to im pai rm ent in com e benef its beca use sec tion 408.121 provided that an e mploy ee’ s entitlement to those benef its beg an on the da

y afte r t he employ ee rea ched max imum medical improvement. Eisler , 981 S.W .2d at 746-47. In light of sec tion 4 0 8
. 1 2 1 , t h e court conclude d that “the leg islature intended that an injured wor ker w ho
rea ches ma x imum medical improvement is entitled to impairment income benef its whe ther or not the injured worke r was disabled for at least seven da y s.” Id. We find Eisler ’s re asoning persua sive, andsi mi lar ly

con clu de t hat sect io n 4 08 .1 61 , n ot sect io n 40 8. 08 2, est abl is hes th e ti me a t w hi ch L I BsTh e Di vi si on als o co nfu ses th e po in t i n t im e wh en em pl oy ees b ecom e e l i gi b l e f or L I Bs 4 with the time at which such eligibility is administratively or j udicially deter mined to exis t. I t urg es that our conclusion would deprive injured worke rs of L I Bs dur ing the period in which a claim for L I B s is pe nd ingin t

he De pa rt men t or th e court s. As pr e vio us ly e xpla ine d, on c e L I B e lig ibi lity is 10 b e c o me p ay able. See als o G ar c ia , 893 S.W .2d at 513 (c hara cter izi ng income bene fits as four separ ate “ tiers”)
.

Our conclusion is f

urther supported by the fac t that section 408.082 addre sses ac crua l of “inc ome bene fits” solely in relation to “disability ,” see Tex. L ab. Code Ann. § 408.082, y et
s e c t i o n4 0 8
. 1 6 1 d e f

i n e s L IB e l i g i b i l i t y w i t h o u t r e g ar d t o t h e e x i s t e n c e o f a d i s a b i l i t y. “ D i s a

b i l i t y” is not mentioned in s ec t i o n 4 08.161, nor do the e numerated injurious conditions in t hat provision
ne c e ssa ri ly c on sti tut e dis a

bil iti e s in a ll c a se s. “ Di sa

bil ity” is d e fi ne d b y

the Ac t a s “ the ina

bil ity beca use of a compensa

ble injury to obtain and re tain employ m en t at wag es equiva lent to the preinjury wag e.” Id
. § 401.011(16). As both parties a cknowledg e, whe ther a condition qualifying
an employ ee for L I Bs is also a disa bility would depend upon the nature of the e mploy ee’ s pre- injury job. These diff

ere nces indicate t hat t he legislature did not intend for section 408.082 to gove rn whe n L I Bs be come pa

y able. I n a dd iti on

to r e lyingup on

se c tio n 4 08 .0 82, the Di vis ion e mph a size s it s d e sir e to
awa rd L I Bs r etroa ctively

so that employ ees who do not qualify for suc h benef

its im mediately

upon i n jury can r ece ive the bene fit of the annua l three- perc ent compensation increa ses for e ach intervening y ear following the injury
. Id
. § 408.161(c)
. I t f urther note s that we a

re to c onstrue the Act li ber a ll y

to e f f e c tu a te th e le g is latu

r e ’ s e v id e n t g o a l o f

e n s u r in g c o mp e n s a ti o nf o r w o r k p la ce inj ur ie s. See Barchus v. State Farm Fire &Cas. Co. , 167 S.W .3d 575, 578 (Tex. App.—Houston

4judicially

or administratively deter

mined, the employ ee would be entitled to such bene fits from the time at which the injurious condition first entitled the employ ee f or L I Bs. 11 [14 t h Dist.] 2005, pet. denied) . Howeve r salutar y a policy g oal this mig ht be , neither the Division
no r t his Court c an e ith e r d e c re a se or

inc re a se c omp e ns a tio n in a mann e r inc on sis te nt w iththe Ac t. F u lto n v . A s s o c ia te d I

n d e m . Corp. , 46 S.W .3d 364, 369 (Tex. App.—Austin 2001, pet. denied); Eisler , 981 S.W .2d at 746-47.

We sustain Mid-Century ’s issue on appe al.
CO NC LU SION Havingsustained Mid-Century ’s issue on appe al, we r ever se the judg ment of the district court and r ender

j u d gm en t t h at s u bsection (b) of rule 131.1 is invalid and in e x cess of the D i v i s i o n ’ s s t a tu t o r

y a u t h o r i t y.

Bob Pembe rton, J ustice Be fore Chief J ustice L aw, Justi ces Pembe rton and Waldrop Reverse d and Rende red Filed: F ebrua

ry 24, 2006