Court Opinion

ID: 9639710
Source: CourtListenerOpinion
Date Created: 2023-08-22 16:45:44.978342+00
Date Added: 2024-06-11T18:10:21.190541
License: Public Domain

HOWELL, Justice,
dissenting.
I dissent. This case, insofar as Carrier is concerned, is controlled by Cox v. Realty Development Corp., 748 S.W.2d 492 (Tex.App.—Dallas 1988, no writ). The majority has not distinguished Cox, which is directly on point, and which holds that sanctions imposed for discovery abuse by one party cannot be imposed against another party committing no discovery abuse. Furthermore, the trial court abused its discretion in dismissing Worker’s suit on the basis of his original attorney’s omission. The entire case should be reversed and remanded.
CARRIER’S CAUSE OF ACTION
The issue has already been decided previously by this court. Cox held that once an insurance carrier has paid a claim and as a result is subrogated to the rights of its insured against a third party, the carrier becomes a pro tanto owner of the insured’s cause of action. Therefore, we held that it was an abuse of discretion for the trial court to dismiss the carrier’s cause of action because of the insured’s discovery violations. Cox, 748 S.W.2d at 494. Atrial court cannot dismiss a party’s case without *616sanctionable misconduct on the part of that party. Id.
It is to be noted that the majority has cited only worker’s compensation cases in support of its ruling against Carrier — no discovery/sanction cases. Possibly, the majority has some notion that Carrier’s case is subject to a different rule because its subrogation rights are regulated by the Worker’s Compensation Act. Any such holding would be a distinction without a difference.
Just as provided by decisions under the Act, including our majority’s citations, it is a well recognized principle of decisional law that a subrogee possesses but a derivative cause of action. See Fox v. Kroeger, 119 Tex. 511, 517, 35 S.W.2d 679, 681 (1931) (subrogee “stands in the shoes” of his sub-rogor). A subrogee can rise no higher than his source: he can assert no right greater than his subrogor; Platte v. Securities Inv. Co., 55 S.W.2d 551, 553 (Tex.Comm’n App.1932, judgm’t adopted); Anchor Casualty Co. v. Robertson Transport Co., 389 S.W.2d 135, 139 (Tex.Civ.App.-Corpus Christi 1965, writ ref’d n.r.e.); he is subject to all defenses that could have been asserted against his subrogor, Platte, 55 S.W.2d at 553; see Hicks v. Wright, 564 S.W.2d 785, 797-98 (Tex.Civ.App.-Tyler 1978, writ ref’d n.r.e.).
Likewise, it is also a well established principle of the general law that a partial assignment or partial subrogation of a claim does not create a separate and independent cause of action. Traders & General Ins. Co. v. Richardson, 387 S.W.2d 478, 479 (Tex.Civ.App.-Beaumont 1965, writ ref’d) (insurer paid insured for property damage; insured sued third-party tort-feasor for personal injuries, but settled, and agreed judgment was entered; payment of money by insurer did not split insurer’s cause of action; thus, judgment in insured’s suit was a bar in insurer’s suit against third-party). Again, that principle has no application to the problem before us: May a trial court dismiss the action of a separately represented subrogee worker’s compensation insurance carrier on account of the failure of the worker and his attorney, if any, to properly respond to discovery? Cox requires a negative answer.
As a matter of fact, the inevitable conclusion to be reached from the majority’s reasoning is that, following the dismissal of Worker’s action, our trial court had no power except to dismiss Carrier’s action. Our majority necessarily holds that a carrier’s cause of action automatically perishes when a worker’s cause of action perishes— that our trial court was possessed of no other possible recourse after dismissing Worker’s action. Such conclusion is not in harmony with the Act; rather, it is out of harmony with the provision of the Act allowing Carrier to independently bring suit in the name of Worker to protect its subro-gation rights. Tex.Rev.Civ.Stat.Ann. art. 8307, § 6a (Vernon Supp.1989). It is clear from the statute that had Worker failed or refused to institute suit, Carrier could have done so. Is a carrier in any less position when the worker does bring suit and the carrier intervenes? There is no reason to so hold. Assume for a moment that having filed suit, and Carrier having intervened, as did happen here, Worker’s attorney concluded that he could more profitably expend his time on other matters than upon the response to third party defendant’s discovery, as perhaps he did. Assume however, that instead of withdrawing, counsel non-suited Worker’s action. If our majority be correct, the only logical conclusion would be that the same fate must befall Carrier’s subrogation action; it also had to be non-suited. However, any such result would fly in the face of the statutory provision expressly allowing Carrier to independently prosecute an action in Worker’s name. Likewise any ruling that a carrier’s action for subrogation is necessarily and automatically forfeited whenever a worker’s action is dismissed as a discovery sanction, also flies in the face of the statutory provision allowing a carrier to proceed independently when the worker fails or refuses to do so.
On analysis, such is exactly what happened in the case at hand. Through his original attorney, Worker timely filed his lawsuit. However, Worker, through his *617original attorney, failed to prosecute his lawsuit with reasonable diligence. Such a holding by the trial court was the essence of the dismissal order. The statute expressly protects Carrier from any omission of Worker in failing to diligently bring suit. By implication, it protects Carrier from any omission of Worker in failing to diligently prosecute the action.
However, the foregoing discussion really misses the mark. The ultimate ground for refusing to sanction the dismissal of Carrier’s action is the fact that we are dealing with punishment. It is fundamental, almost trite, to point out that punishment is for the guilty, not the innocent. The trial Court found no sanctionable conduct on behalf of Carrier. Without a basis for punishment, it was without authority to punish. See Bodnow Corp. v. City of Hondo, 721 S.W.2d 839, 840 (Tex.1986) (trial court abused its discretion when it made party liable for discovery expenses caused by misconduct of another). The rules relating to discovery sanctions must be flexible; the trial courts must be free to apply the proper sanctions where they are merited. On the other hand, the law relating to sanctions must be free from the type of mechanical approach manifested by our majority where the shortcomings of one litigant are attributed to another. Every party to litigation who engages in discovery violations must be held fully answerable for his own misconduct but never for the misconduct of others where he bears no fault. The sanctions against Carrier must be reversed.
WORKER’S CAUSE OF ACTION
Furthermore, insofar as Worker is concerned, the trial court imposed the maximum penalty, dismissal with prejudice, without an adequate showing of fault. In doing so, it abused its discretion.
A trial court abuses its discretion if the sanction it imposes does not further one of the purposes that discovery sanctions were intended to further. Bodnow, 721 S.W.2d at 840. The sanctions must be “just.” Tex.R.Civ.P. 215(2)(b); Bodnow, at 840; Ray v. Beene, 721 S.W.2d 876, 879 (Tex.App.-Houston [1st Dist.] 1986, writ ref’d n.r.e.). It cannot be argued that any legitimate objective was served by imposing the severest of all sanctions in this case, and for such reason, the dismissal of Worker’s cause must be reversed.
The reason why the sanctions against Worker must also fall is similar to the reason why the sanctions against Carrier must fall. To the farthest extent possible, sanctions must be imposed against the actual offender. See Bodnow, 721 S.W.2d at 840 (Making a party liable for discovery expenses that are caused by another party’s misconduct does not further any of the purposes that discovery sanctions were intended to further.). No other approach will meet the only legitimate goal of sanctions, to punish offenders and to secure compliance with the discovery rules. See Id.
The principal offender in this case was Worker’s original attorney who failed for an extended time to respond to the third party defendant’s discovery and who, rather than do so, finally chose to withdraw thereby precipitating further delay while worker searched for substitute counsel. However, it is too late to punish the withdrawing attorney through dismissal of the case. By withdrawing, he had already, in effect dismissed himself from the case. By doing so, he had already imposed upon himself a sanction. He thereby deprived himself of any right to be compensated for the time that he had already spent in the prosecution of the action. In making this statement, it is to be judicially noticed that almost all worker’s compensation claims are prosecuted on a contingent fee basis. However, even a time-and-effort-fee attorney, by withdrawing, forfeits the right to earn additional compensation, and often leaves behind a dissatisfied client who will neither patronize nor recommend him in the future.
Our trial court, being impotent to punish or further punish the real offender, the withdrawing attorney, has proceeded to punish a party who had little or no culpability, the client himself. In making this statement, the writer readily concedes that it is commonplace for the courts to punish *618clients for the shortcomings of the attorney. Countless times, the courts have held that the client has forfeited (the euphemism of “waiver” is generally employed) the right to complain because his lawyer, certified by his government to be competent, has failed to present a timely and proper objection. However, we must be ever mindful that clients are punished for the shortcomings of lawyers out of necessity. Our courts have thus far failed to devise a means to secure diligence and competency or to maintain an orderly procedure, without visiting the shortcomings of lawyers onto hapless clients.
Inasmuch as the rule is rooted in necessity, it must be limited by necessity. What was the necessity of assessing punishment against our worker for the shortcomings of a lawyer who had already forfeited his interest in the case? Had some great and demonstratable imposition upon the third party defendant been shown, necessity would have required the ultimate sanction of dismissal. However, the record only reflects the frustrations and delay that are commonplace to litigation. Under these circumstances, it was an abuse of discretion to impose the ultimate sanction upon a client who was left to fend for himself by an attorney who chose to go on to other (and presumably more remunerative) endeavors.
Our majority’s authorities of Stein and Bailey have no application because the litigants in those cases chose to represent themselves. See Stein, 481 S.W.2d at 439; Bailey, 631 S.W.2d at 786-87. Worker did not choose to represent himself. Rather, Worker’s attorney withdrew; it was several months before Worker was able to secure the services of another attorney, possibly because there was a “right of first money” claim against any judgment or settlement that Worker might receive. Worker’s substitute attorney may not have been as diligent as he should have been, but he had reason to believe that the interrogatories had been answered, he appeared at the hearing, he presented a partial response, and he made an offer to obtain the other answers within a reasonable time.
In Bodnow, the Supreme Court held that the trial court had abused its discretion by “[mjaking a party liable for discovery expenses that [were] caused [solely] by another party’s misconduct....” Bodnow, 721 S.W.2d at 840. The Court declared that such action “does not further any of the purposes that discovery sanctions were intended to further,” and that the sanctions were therefore an abuse of discretion. Id. The identical reasoning is here applicable. That reasoning requires that Worker’s cause of action also be reversed.
I therefore dissent. Both the dismissal of Carrier’s case and the dismissal of Worker’s ease must be reversed. This action must be remanded to the trial court for further proceedings.