Court Opinion

ID: 2865845
Source: CourtListenerOpinion
Date Created: 2015-09-06 01:00:20.239799+00
Date Added: 2024-06-11T11:31:34.427557
License: Public Domain

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-
01-00326-CV

Sunbeam Environmental Services, Inc. and Alphonso Solomon
and Company, Inc., Appellants

v.

Texas Workers' Compensation Insurance Facility, succeeded by the Facility

Insurance Corporation, Appellee

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 250TH JUDICIAL DISTRICT

NO. 97-0115, HONORABLE SCOTT JENKINS, JUDGE PRESIDING

	Appellants Sunbeam Environmental Services, Inc. (Sunbeam) and Alphonso Solomon
and Company, Inc. (ASC) challenge a judgment favoring the Texas Workers' Compensation
Insurance Facility (the Facility). (1)  The district court found appellants jointly and severally liable to
the Facility for unpaid premiums, interest on those premiums, and attorney's fees.  Because we find
this cause is not barred by the statute of limitations and the evidence is sufficient to support the
award, we affirm the district court's judgment.

BACKGROUND

	Sunbeam and ASC are both Texas corporations wholly owned by Alphonso Solomon
(Solomon).  Sunbeam received workers' compensation insurance coverage through the Facility.
The Facility was "a private, non-profit, unincorporated association of insurers authorized to write
workers' compensation insurance in Texas for employers who are unable to obtain coverage through
private insurance companies."  See All Star Sheet Metal & Roofing, Inc. v. Texas Dep't of Ins., 935
S.W.2d 186, 189 (Tex. App.--Austin 1996, no writ).
	This dispute concerns premiums on policies in effect in 1992 and 1993.  Workers'
compensation insurance premiums are based on payroll expenditures.  Insureds are required to pay
premiums based on their estimated payroll, but the final premium cannot be calculated until all
salaries and wages for the coverage period have been disbursed.  Part five of the standard workers'
compensation insurance policy calls for a payroll audit to calculate the final premium within three
years of the end of the coverage period.  Coverage for Sunbeam under the first policy in this case
began January 29, 1992.  Upon learning that Sunbeam was a "combinable" risk with ASC because
Solomon wholly owned both companies, the Facility required ASC to apply for coverage or the
Facility would cancel Sunbeam's policy.  ASC applied and, on February 21, 1992, was added as an
insured through an endorsement on the first policy issued to Sunbeam.  The two companies renewed
coverage under the second policy for the year beginning January 29, 1993.  The Facility canceled the
second policy on June 8, 1993, for nonpayment of premiums and failure to make required reports.
	The district court found that appellants owed the Facility for unpaid premiums on
these policies, less an offset due for a refund of a maintenance tax.  Audits showed that appellants
owed $7,520.13 in additional premium on the first policy and $5,808.33 in premium on the second
policy, less the credit of $871.47, yielding a total due of $12,456.99; the court also assessed
prejudgment interest of $6,223.27, court costs, and postjudgment interest.  The court awarded
attorney's fees of $3114 plus additional amounts for appeals.

DISCUSSION

	Appellants raise eight issues on appeal.  They assert that limitations bars the Facility
from recovering on the first policy.  By five issues, they complain about various aspects of the
evidence admitted in support of the judgment, including the sufficiency of the evidence.  They
further complain that the Facility did not give pre-suit notice sufficient to empower the court to
award attorney's fees and that attorneys not designated as the attorney in charge purported to act for
the Facility.

Limitations
	Appellants contend that the statute of limitations bars the Facility's claims for
premiums owed on the policy that expired at 12:01 a.m. on January 29, 1993.  Because this is a suit
for debt based on a breach of contract, a four-year statute of limitations applies.  See Tex. Civ. Prac.
& Rem. Code Ann. § 16.004 (West Supp. 2002).  Appellants contend that the suit was filed too late
because it was filed hours after the four-year period expired at 12:01 a.m. on January 29, 1997.
	We find no authority to support appellants' assertion that limitations periods are
computed on any unit of time shorter than a day.  The Facility's cause of action was thus timely filed
even if the limitations period began running on January 29, 1993.
	The limitations period did not begin running on January 29, 1993, however.  Part five
of the workers' compensation policy states that, because the final premium is based on the actual
payroll disbursed, the final premium cannot be determined until after the end of the policy term; the
policy specifies that the audit will occur within three years of the end of the policy term.  Here, the
auditors sent an invoice on May 28, 1993 for the additional $7520.13 they determined appellants
owed in premiums on the first policy.  This suit for collection of this amount, filed less than four
years after the date of this invoice, was timely.

Sufficiency of the evidence
	Appellants raise five issues that essentially challenge the sufficiency of the evidence
to support the judgment.  When reviewing no-evidence challenges, we will consider all the evidence
in the light most favorable to the judgment, making every reasonable inference in its favor.  See
Associated Indem. Corp. v. CAT Contracting, Inc., 964 S.W.2d 276, 285-86 (Tex. 1998);
Transportation Ins. Co. v. Moriel, 879 S.W.2d 10, 25 (Tex. 1994).  We will uphold the jury's finding
if more than a scintilla of evidence supports it.  Burroughs Wellcome Co. v. Crye, 907 S.W.2d 497,
499 (Tex. 1995); Seideneck v. Cal Bayreuther Assocs., 451 S.W.2d 752, 755 (Tex. 1970); In re
King's Estate, 244 S.W.2d 660, 661 (Tex. 1951).  The evidence supporting a finding is more than
a scintilla if reasonable minds could arrive at the finding given the facts proved in the particular case. 
See Crye, 907 S.W.2d at 499; Moriel, 879 S.W.2d at 25.  When reviewing factual-sufficiency
challenges, we consider all the evidence and uphold the jury's verdict unless we find that (1) the
evidence is too weak to support the finding, or (2) the finding is so against the overwhelming weight
of the evidence as to be manifestly unjust.  Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex. 1996); Cain
v. Bain, 709 S.W.2d 175, 176 (Tex. 1986).
	Appellants complain that the Facility did not provide "complete documents as
evidence to show the court that a contract was violated."  They point to the sole witness's testimony
that she did not know whether appellants had received any of the insurance documents.  Appellants'
argument regarding receipt of the contract is made for the first time on appeal.  The witness was an
employee of the Facility, not the servicing company or any of the appellants, and so did not have
direct knowledge of what the servicing company sent or what the appellants received.  She testified
that the standard procedure would be for the servicing company to send to the insured a standard
policy with boilerplate language dictated by the State.  The policy's boilerplate language explains
the process of estimating premiums and calculating them within three years after the coverage period
based on actual payroll.  Though the Facility did not introduce a copy of a policy contained in
appellants' files, there was no evidence that the appellants' contract differed in any material respect
from the contracts in evidence used to illustrate the terms of appellants' contract.  Further,
appellants' attorney effectively conceded receipt and coverage at trial, stating that "no one is arguing
that they're not covered by insurance."  The evidence admitted was sufficient to show the terms of
the contracts.
	Appellants next contend that ASC was only an additional named insured and not
liable for premiums on Sunbeam's policies.  They contend that ASC never had an account or policy
with the Facility, that a policy was never issued to ASC, and that ASC never received a policy or
endorsement.  Appellants do not cite to any evidence from the trial record supporting these claims.
Appellants' argument that ASC had no liability for premiums is premised on the fact that ASC did
not voluntarily apply for the insurance policy.  The Facility did not mandate that ASC request
coverage; Solomon could have chosen to forego workers' compensation insurance for both
companies, but chose to apply for coverage for ASC to preserve coverage for Sunbeam.  The only
evidence is that ASC applied for and received coverage on equal footing with Sunbeam--ASC was
"combined" with Sunbeam for purposes of workers' compensation insurance--rather than passively
receiving coverage under Sunbeam's policy.  The January 1993 application for insurance lists both
Sunbeam and ASC as names of the applicant, as does the binder issued for that policy.  Both
companies were wholly owned by Solomon and received their mail at the same address.  The only
evidence is that both were insureds, and thus that they were both liable for premiums owed on the
coverage provided to both companies.  The evidence supports the finding that ASC shared liability
for premiums for the coverage provided.
	Appellants contend for the first time on appeal that the Facility miscalculated the
premiums due on both policies.  They contend that they were erroneously charged the same rate for
supervisory employees as for janitorial workers, causing overcharges because the rate for supervisory
employees was lower.  The affidavits attached to appellants' brief were not offered or admitted at
trial and do not bear file stamps indicating that they were filed with the district court.  Some of the
exhibits attached to the affidavits are the same as documents admitted at trial, but they do not require
us to find that the Facility miscalculated the premiums due.  Appellants neither preserved this
argument nor presented a record requiring reversal.

Attorney's fees
	Appellants contend that the Facility cannot recover attorney's fees because it did not
give proper notice before filing suit.  They also contend that bills sent do not satisfy the statute
permitting attorney's fees.  See Tex. Civ. Prac. & Rem. Code Ann. § 38.002 (West 1997). (2) 
Appellants contend the bills do not satisfy the statute because they were not issued by the Facility's
attorney.  Appellants misread section 38.002; though the party requesting attorney's fees must both
make demand for payment (to ensure that the debtor is aware of the debt being sued upon) and be
represented by counsel (so that there is an attorney who is due the fees requested), there is no
requirement that the demand must be made by counsel.  See id.  The only evidence in the record is
that the Facility sent invoices to the appellants for premiums due on each of the policies; there is no
evidence in the trial record that the appellants did not receive the bills.  The only evidence is that
appellants failed to pay the amounts the Facility billed them and that the Facility was represented by
counsel.  The record supports the conclusion that the Facility satisfied section 38.002.  Id.
	In their reply brief, appellants for the first time challenge their liability for $350 in
attorney's fees awarded to the Facility for filing a motion to compel them to respond to
interrogatories.  A reply brief is limited in scope to responding to matters in an appellee's brief.
Tex. R. App. P. 38.3.  The Facility did not mention the $350 award.  Appellants waived this
complaint by failing to raise it in their initial brief.

Authorization of attorneys
	Appellants contend that all pleadings and documents filed by attorneys other than
David Dillon were unauthorized.  Appellants correctly assert that, by signing the Facility's original
petition, Dillon became the Facility's attorney in charge.  See Tex. R. Civ. P. 8.  The record plainly
shows that attorneys other than Dillon signed and filed documents without being designated as
attorneys in charge.  All attorneys signing and filing documents on the Facility's behalf were from
the same firm as Dillon.  Though appellants were entitled to continue to correspond with the attorney
in charge, they cite no authority for the proposition that documents filed by other attorneys from his
firm were invalidly filed.  Most important, appellants have not shown how they were harmed by the
filing of documents by co-counsel in the firm of the attorney in charge.  See Tex. R. App. P. 44.1;
see also Spellmon v. Collins, 970 S.W.2d 578, 580 (Tex. App.--Houston [14th Dist.] 1998, no pet.). 
We resolve this issue in favor of the judgment.

CONCLUSION

	Having resolved all issues in favor of the judgment, we affirm the district court's
judgment.

  
					Bea Ann Smith, Justice
Before Chief Justice Aboussie, Justices B. A. Smith and Puryear
Affirmed
Filed:   February 22, 2002
Do Not Publish Released for publication April 18, 2002.  Tex. R. App. P. 47.3(c).
1.   According to testimony at trial and appellate briefs, the Facility Insurance Corporation
succeeded the Texas Workers' Compensation Insurance Facility.  The succession had occurred by
time of trial and had no known effect on this case; we will refer to appellee simply as the Facility.
2.   This statute requires that "(1) the claimant must be represented by an attorney; (2) the
claimant must present the claim to the opposing party or to a duly authorized agent of the opposing
party; and (3) payment for the just amount owed must not have been tendered before the expiration
of the 30th day after the claim is presented."  Tex. Civ. Prac. & Rem. Code Ann. § 38.002 (West
1997).