Justice GREEN delivered the opinion of the Court, in which Justice WAINWRIGHT and Justice BRISTER joined, and in Parts I, II, III, IV, V, VI, VIII and IX of which Justice HECHT joined, and in Parts I, II, III, IV, V, VI, VII, and IX of which Justice JOHNSON joined, and in Parts I, II, III, VI, VII, and IX of which Justice WILLETT joined.
Rehearing was granted in this case and our previous opinion was withdrawn. We now substitute the following in its place. The judgment remains unchanged.
In this workers' compensation case, we decide whether a premises owner that contracts for the performance of work on its premises, and provides workers' compensation insurance to the contractor's employees pursuant to that contract, is entitled to the benefit of the exclusive remedy defense generally afforded only to employers by the Texas Workers' Compensation Act. While the Act specifically confers statutory employer status on general contractors who qualify by providing workers' compensation insurance for their subcontractors' employees, it says nothing about whether premises owners who act as their own general contractor are also entitled to employer status, and thus the exclusive remedy defense. We hold that the exclusive remedy defense for qualifying general contractors is, likewise, available to premises owners who meet the Act's definition of "general contractor," and who also provide workers' compensation insurance to lower-tier subcontractors' employees. Because we conclude that Entergy Gulf States, Inc. meets the definition of "general contractor" under the Act, and because Entergy otherwise qualifies under the Act as having provided workers' compensation insurance under its written agreement with International Maintenance Corporation (IMC), it is entitled to the exclusive remedy defense against the negligence claims brought by IMC's employee, John Summers. We reverse the court of appeals' judgment and render judgment for Entergy.
I
Entergy contracted with IMC to assist in the performance of certain maintenance, repair and other technical services at its
II
The Act outlines a process by which a general contractor qualifies for immunity from common-law tort claims brought by the employees of its subcontractors.
Summers first argues that Entergy failed to establish as a matter of law that Entergy and Summers executed a written agreement under which Entergy would provide workers' compensation coverage. See TEX. LAB.CODE § 406.123(a). Summers' chief argument is that the contract for maintenance, construction, and general services was between IMC and another Entergy company, Entergy Services, Inc., as opposed to Entergy Gulf States, Inc. However, the contract stated that Entergy Services, Inc. acted for itself and as agent for other Entergy Companies, defined to include the Entergy petitioner here. Summers also admitted in his response to Entergy's summary judgment motion that the
III
The meaning of a statute is a legal question, which we review de novo to ascertain and give effect to the Legislature's intent. F.F.P. Operating Partners., L.P. v. Duenez, 237 S.W.3d 680, 683 (Tex. 2007). Where text is clear, text is determinative of that intent. State v. Shumake, 199 S.W.3d 279, 284 (Tex.2006) ("[W]hen possible, we discern [legislative intent] from the plain meaning of the words chosen."); see also Alex Sheshunoff Mgmt. Servs., L.P. v. Johnson, 209 S.W.3d 644, 651-52 (Tex.2006). This general rule applies unless enforcing the plain language of the statute as written would produce absurd results. Fleming Foods of Tex., Inc. v. Rylander, 6 S.W.3d 278, 284 (Tex.1999). Therefore, our practice when construing a statute is to recognize that "the words [the Legislature] chooses should be the surest guide to legislative intent." Fitzgerald v. Advanced Spine Fixation Sys., Inc., 996 S.W.2d 864, 866 (Tex.1999). Only when those words are ambiguous do we "resort to rules of construction or extrinsic aids." In re Estate of Nash, 220 S.W.3d 914, 917 (Tex.2007).
With these principles in mind, we examine what the Legislature meant by the term "general contractor" in the workers' compensation statute. We do not look to the ordinary, or commonly understood, meaning of the term because the Legislature has supplied its own definition, which we are bound to follow. TEX. GOV'T CODE § 311.011(b). The Legislature defines "general contractor" as:
TEX. LAB.CODE § 406.121(1). That a premises owner can be a "person" within the meaning of the statute is not challenged. The dispute, instead, centers on whether one who "undertakes to procure the performance of work" can include a premises owner, or whether that phrase limits the definition of general contractor to non-owner contractors downstream from the owner.
Since the words contained within the definition are not themselves defined, we apply a meaning that is consistent with the common understanding of those terms. According to Black's Law Dictionary, "undertake" generally means to "take on an obligation or task," and "procurement"
IV
The dissent, and some amici, contend that our reading of the statute constitutes a major change in the law that, for the first time, would enable premises owners to become statutory employers entitled to the exclusive remedy defense—a result they say the Legislature never intended. 282 S.W.3d 511. However, the Legislature enacted the section that established "deemed employer" status in 1917, the very first provision to address a subscriber's coverage of subcontractors' employees. See Act of Mar. 28, 1917, 35th Leg., R.S., ch. 103, § 1, Part II, sec. 6, 1917 Tex. Gen. Laws 269, 284-85. Since then, subsequent revisions have not indicated an intent to create the kind of exception for owner-subscribers the dissent would now recognize. Indeed, when the "deemed employer" statute was first enacted, the Act made no reference at all to "general contractors." Instead, the provision applied only to "subscribers," a general term that included all purchasers of workers' compensation insurance.
V
The dissent contends that the Act never covered premises owners in the first place, and that owners were not included within the definition of general contractors in the 1989 amendment. We disagree. The originating statute applied to "any subscriber," which necessarily means that, under the old version of the Act, a subscriber who also happened to be a premises owner would not be permitted to escape liability to a worker by contracting out the work. By operation of the statute, then, the owner-subscriber who contracted out work to avoid liability for its workers' injuries would nevertheless be considered the employer, the injured worker would be entitled to benefits under the owner's workers' compensation policy, and the owner would be entitled to assert the exclusive remedy defense. See Act of Mar. 28, 1917, 35th Leg., R.S., ch. 103, § 1, Part II, sec. 6, 1917 Tex. Gen. Laws 269, 284-85. So while the provision may have been enacted for the purpose of preventing employers from trying to avoid liability, the scope of its application did not exclude premises owners.
In 1983, however, an amendment provided, for the first time, for voluntary employer status for upstream entities in the contracting chain through the use of written agreements between parties. Act of May 28, 1983, 68th Leg., R.S., ch. 950, § 1, sec. 6, 1983 Tex. Gen. Laws 5210, 5210-11. More specifically, a general contractor was permitted to enter into a written agreement to provide workers' compensation insurance coverage to its subcontractors and its subcontractors employees and, upon doing so, the "prime contractor"
There can be no doubt that premises owners can be, and often are, employers who carry workers' compensation insurance. It is also true that owners frequently contract with others to perform work on their premises. But there has never been a requirement that an owner must first engage a general contractor to have work done on its premises. The owner is free to do the work with its own employees, to directly contract with others to do the work, or to do the work using some combination of the two. The dissent says an owner can be an employer, but cannot be a general contractor. However, we can find nothing in the statute specifying that an owner who also wears the hat of a general contractor is disqualified from coverage under the Workers' Compensation Act simply because it chooses to contract directly for work on its premises.
Entergy did the very thing the Legislature has long tried to encourage; that is, Entergy became a subscriber by taking out a workers' compensation policy for the entire work site. It would be an odd result, indeed, if this premises owner, acting as its own general contractor, and further acting in accordance with the State's strong public policy interest of encouraging workers' compensation insurance coverage for workers, was now to be excluded from the Act's protections. See Tex. Workers' Comp. Comm'n v. Garcia, 893 S.W.2d 504, 510-16 (Tex.1995). Whether a premises owner, general contractor, prime contractor, or subcontractor, Entergy is a "subscriber" of a workers' compensation policy and therefore satisfies the Legislature's intent to ensure consistent and reliable coverage to all employees.
VI
The dissent and the court of appeals contend that the only way to qualify as a "general contractor" is to be included in a "tripartite" relationship in which a general contractor in the middle of the transaction has, first, undertaken to perform work for an owner, and second, contracted part of that work to a subcontractor. 282 S.W.3d 511. But the statute is not written so restrictively as to encompass only a three-party relationship, for several reasons. First, such a construction ignores the single exception found in the last sentence of the definition: "The term does not include a motor carrier that provides a transportation service through the use of an owner operator." TEX. LAB.CODE § 406.121(1). Here, the inclusion of an "owner operator" in the definition's only exception indicates that the Legislature intended for some owners to qualify as general contractors, while carving out only a narrow class of owners excluded from the term. Id. Since the Legislature clearly specified that the exception apply only to a very narrow class, we decline to read this narrow exception broadly to include all premises owners.
Second, the definition is not as restrictive as the dissent supposes because the second sentence of the definition, which specifies types of contractors to be included within the definition, specifically provides that the list is non-exhaustive. Id. ("The term includes a `principal contractor,' "original contractor,' `prime contractor,' or other analogous term."). If we held that an "owner contractor" is not analogous to a "principal contractor," "original contractor," or "prime contractor," we would essentially be strictly construing a sentence that is explicitly non-exhaustive, as even the dissent concedes. 282 S.W.3d 511. Inasmuch as we have been instructed that "`[i]ncludes' and `including'
Additionally, such a reading renders meaningless the part of the definition that qualifies how a general contractor "undertakes to procure the performance of work." TEX. LAB.CODE § 406.121(1) (a general contractor "undertakes to procure the performance of work or a service, either separately or through the use of subcontractors") (emphasis added). A reasonable reading of the words, "either separately or through the use of subcontractors," recognizes the distinction between the owner who takes it upon himself "separately" to procure the performance of work from subcontractors, and the owner who undertakes with a middleman "general contractor" to procure the performance of work "through the use of subcontractors." See id.; see also BLACK'S LAW DICTIONARY 1099 (7th ed. 2000) ("Separate" is defined as "individual; distinct, particular; disconnected"). Certainly, one can hire a bricklayer, electrician, or cabinet maker to remodel his own office building— thereby acting "separately"—or, he can hire a general contractor to do the same thing—thereby acting "through the use of subcontractors." This qualifier suggests that the Legislature at least contemplated the existence of a premises owner who may want to act as its own general contractor—an outcome that is by no means uncommon.
Finally, we address Williams v. Brown & Root, Inc., the case relied on by the court of appeals in reaching its conclusion that a premises owner is excluded from the Act's definition of "general contractor." 947 S.W.2d 673 (Tex.App.-Texarkana 1997, no writ). In Williams, a premises owner, Eastman, contracted with Brown & Root to provide occasional construction services. Id. at 675. Brown & Root subcontracted part of the work to Tracer. Id. Tracer's employee, Williams, was injured on Eastman's jobsite, so he applied for and received benefits from Eastman's workers' compensation policy covering Tracer. Id. After Williams sued Eastman and Brown & Root for his injuries, the trial court granted summary judgment for both defendants, in part because the exclusive remedy was workers' compensation insurance, which had already been provided. Id. On appeal, the court of appeals rejected the argument that the predecessor to this section of the Act
VII
We granted rehearing to address several supplemental arguments made by the respondent and by a number of amici, many of which urge us to address the issue before us by going beyond the statutory text and looking to extrinsic aides such as the Act's legislative history. But we have been clear that we do not resort to such extrinsic aides unless the plain language is ambiguous. See, e.g., Nash, 220 S.W.3d at 917 ("If a statute is clear and unambiguous, we apply its words according to their common meaning without resort to rules of construction or extrinsic aides."); Sheshunoff, 209 S.W.3d at 652 n. 4.
Even if we assume the definition of "general contractor" is ambiguous, the legislative history of the bill's passage favors Entergy, not Summers. The legislative history that supports Summers' outcome is
As for the legislative history of what did pass, the 1989 overhaul of the Workers' Compensation Act amended the statutory definition of "subcontractor." Under the pre-1989 definition, a subcontractor was defined as "a person who has contracted to perform all or any part of the work or services which a prime contractor has contracted with another party to perform." Act of May 28, 1983, 68th Leg. R.S., ch. 950, § 1, 1983 Tex. Gen. Laws 5210, 5210, amended by Act of Dec. 11, 1989, 71st Leg.2d C.S., ch.1, § 3.05(a)(5), 1989 Tex. Gen. Laws 1, 15 (emphasis added). The Act, as amended, deleted "with another party," which is the very phrase that Summers argues prevents a premises owner from also being the general contractor. See Wilkerson v. Monsanto Co., 782 F.Supp. 1187, 1188-89 (E.D.Tex.1991) (interpreting "contracted with another party" in the pre-1989 definition to mean the prime contractor and premises owner must be distinct entities). We give weight to the deletion of the phrase "with another party" from the amended definition since we presume that deletions are intentional and that lawmakers enact statutes with complete knowledge of existing law. See Acker v. Tex. Water Comm'n, 790 S.W.2d 299, 301 (Tex. 1990). It is, of course, axiomatic that the deletion of language better indicates the Legislature's intent to remove its effect, rather than to preserve it. Thus, the removal of the phrase "with another party" from the subcontractor definition favors, rather than argues against, an interpretation allowing premises owners to act as their own general contractors for the purpose of workers' compensation laws. TEX. LAB.CODE § 406.121(5). Enforcing the law as written is a court's safest refuge in matters of statutory construction, and we should always refrain from rewriting text that lawmakers chose, but we should be particularly unwilling to reinsert language that the Legislature has elected to delete. See Simmons v. Arnim, 110 Tex. 309, 220 S.W. 66, 70 (1920) ("Courts must take statutes as they find them.").
Amici cite to statements by some lawmakers that the Act, and particularly the 1989 amendment, was never intended to provide statutory employer status to premises owners. Just as we decline to consider failed attempts to pass legislation, we likewise decline consideration of lawmakers'
VIII
Excluding a premises owner who acts as a general contractor also fails to serve the public policy of encouraging workers' compensation coverage for all workers. See Wingfoot Enters. v. Alvarado, 111 S.W.3d 134, 140, 142 (Tex.2003); Garcia, 893 S.W.2d at 521. As noted, the Act offers incentives to general contractors to provide workers' compensation coverage broadly to work site employees. In exchange, the Act specifically protects general contractors—who are not direct employers of subcontractors' employees—by allowing them to assert as a statutorily deemed employer the exclusive remedy defense. In light of this statutory protection, it would seem to be contrary to the state's public policy to read out of the Act's protections those premises owners who have otherwise qualified under the Act by purchasing workers' compensation coverage for their work site employees, but who have chosen to act as their own general contractor.
In the dissent's view, a premises owner who, in complying with the Act, enters into a written agreement to provide workers' compensation coverage to all contractors and contractors' employees at its work site would be the only contractor-employer in the contracting chain not afforded the exclusive remedy defense. Presumably, in that event all the downstream contractors would be considered subscribers under the premises owner's OPIP, thereby qualifying as statutory employers by virtue of their written agreements. See TEX. LAB.CODE § 406.123(a). But the dissent would disqualify the premises owner—the one who secured and actually paid for the policy— from being a statutory employer of his subcontractors' employees. As a result, the premises owner's own employees, working side-by-side with the other contractors' employees, would be limited to workers' compensation benefits for their injuries while the other contractors' employees injured in the same accident would be permitted to seek tort remedies against the premises owner in addition to the workers' compensation benefits provided by the premises owner. Unless the statute directs such a result, it makes no sense to read the statute in such an unreasonable manner. The dissent contends that this outcome is a policy choice made by the Legislature, but we interpret the statute in the context of a policy that encourages the provision of workers' compensation coverage to all workers on a given work site, not discouraging it by denying the statute's protections to the owner who enters into just such a plan.
IX
We conclude that Entergy qualifies under the Act's definition as a "general contractor" and, as a statutory employer, is entitled to assert the exclusive remedy defense. TEX. LAB.CODE § 408.001. The judgment of the court of appeals is reversed
Justice HECHT filed a concurring opinion.
Justice HECHT, concurring.
I think the Court's construction of the statutory text is reasonable, but so is the dissent's (though I disagree with much of its analysis), which means that the provisions are ambiguous and can be understood correctly only in the context of the Texas Workers' Compensation Act as a whole. I join in all but Part VII of the Court's opinion and write separately to explain my reasons for doing so, which come down to this: the Act encourages coverage, as does the Court's construction, but the dissent's does not.
I
Ascertaining the meaning of a statutory text (or any text for that matter) begins with the language used, and if that language is plain enough, absent some obvious error or an absurd result, that is where the task ends.
But that principle is undermined when it is invoked where it does not apply—that is, when the language of the text is not, in fact, plain. To find plain meaning where it is missing suggests at best that the investigation is insincere or incompetent, at worst that the search is rigged, that the outcome, whatever it is, will always come out to be "plain". Fidelity to plain meaning is important only if the word "plain" has itself a plain meaning.
I fear the phrase "plain language" has been overworked to the point of exhaustion. It has appeared in published Texas cases more often in the past decade than in the prior fifteen,
Only every so often do we come right out and brand a text with the a-word,
Rather than struggle to understand and explain a difficult text, it might seem easier to fall back on a simple insistence that all language have a plain meaning, but doing so risks leaving the impression that the court is not being entirely honest. Courts must scrupulously guard against both evils, but in doing so, cannot ignore a statute's context that may illumine its meaning. Years ago Special Chief Justice Samuels
II
The Workers' Compensation Act provides that a general contractor who agrees to furnish workers' compensation insurance coverage to a subcontractor and its employees becomes their employer for purposes of the Act—their statutory employer, if you will—so that their exclusive remedy against the general contractor for on-the-job injuries is compensation benefits. Specifically, the relevant provisions of the Labor Code state:
The question is whether a person who subcontracts work to be done on his own property is a general contractor for purposes of these provisions. In the Court's first opinion, we all thought from the "plain and ordinary meaning" of the provisions the answer was clearly yes.
Scrutinizing the text does not resolve the difficulty. The statutory definition of "general contractor" has three components. The first is this prescription: "`General contractor' means a person who undertakes to procure the performance of work or a service, either separately or through the use of subcontractors." A premises owner who undertakes to procure the performance of work or service on his property would appear to fit this definition of general contractor. A premises
The second component of the statutory definition is a non-exclusive list of examples: "The term includes a `principal contractor,' `original contractor,' `prime contractor,' or other analogous term." The dissent asserts that "we have for decades defined a contractor as `any person who, in the pursuit of an independent business, undertakes to do a specific piece of work for other persons ....'", quoting a 1942 decision of this Court, Industrial Indemnity Exchange v. Southard,
The issue was the same in Shannon, a case decided by the commission of appeals. Certainly, a person could not act as his own independent contractor; his independence would be severely compromised. But nothing in either case suggests that an owner cannot act as his own general contractor. The dissent points out correctly that the Legislature has sometimes used "general contractor" in a way that excludes a premises owner.
The list of examples is specifically non-exclusive but obviously intended to illustrate similarities.
The definitions describe someone who might or might not be the owner of the jobsite. The same dictionary gives this definition of "general contractor":
It defines "prime contractor" thusly:
Neither of these definitions excludes a jobsite owner from acting as his own general contractor. Other dictionaries are similarly inconclusive.
The third component of the statutory definition is an exclusion: "The term does not include a motor carrier that provides a transportation service through the use of an owner operator." The Court argues that expressing only one exclusion suggests that no others exist.
The statutory definition of "subcontractor" —"a person who contracts with a general contractor to perform all or part of the work or services that the general contractor has undertaken to perform"—does not help clarify the matter. A premises owner may be a general contractor who "undertake[s] to perform" work by contracting with subcontractors.
Examined with precision, the statutory text can reasonably be read to provide that a person who undertakes to procure work or service is no less a general contractor because he also happens to own the premises where the job is to be done, and no less a statutory employer when he provides workers' compensation insurance coverage for subcontractors and their employees. That, of course, is why the Court was unanimous in its first opinion. The dissenters too quickly dismiss a position they so recently embraced unreservedly; sometimes wrong, they are never in doubt. But their basic argument has weight: general contractor often refers to someone who works for the job owner. This reading of the statute is a reasonable one, in my view, but it is not the only reasonable one.
III
The disagreement in this case is not over words and cannot be resolved with dictionaries. It is over consequences and can only be settled by examining how the statutory provisions fit in the context of the Workers' Compensation Act as a whole. The issue for the Court is not whether it is good policy to treat a person who arranges for work to be done on his property as a general contractor, something we cannot decide, but whether such treatment is most consistent with the policies embedded in the Act. For four reasons, I believe it is.
First: The Act's "decided bias" is for coverage.
Second: Since 1917, the Act has expressly prohibited a subscriber from using a subcontractor to circumvent coverage.
Third: Since 1963, the Act has provided that a subscribing employer may agree in writing, before a worker has been injured, to assume a third party's liability for the injury.
Fourth: The Act creates a comprehensive system,
The Act, first passed in 1913, provides an injured worker guaranteed but limited wage and medical benefits quickly and without regard to fault, in exchange for which the worker foregoes common law damage claims against his employer.
An owner-run jobsite is not uncommon. No one has suggested a reason why a general contractor who works for an owner can submit to the obligations and protections of the workers' compensation system as a statutory employer for all the workers on the job, while the owner himself cannot, other than to subvert the system. Of course, the Legislature needs no reason to differentiate between general contractors who do not own the jobsite and those who do. But we are required to presume that
IV
The argument is made, however, that the Legislature is not likely to have intended by its definition of "general contractor" to include a person who has work done on his own property because that would have been a major change in the law that would have drawn attention when in fact it was enacted without note. The Court followed the same line of reasoning in Energy Service Co. of Bowie, Inc. v. Superior Snubbing Services, Inc.,
Before 1983, the only provision in the Workers' Compensation Act relating to coverage of a subcontractor was article 8307, section 6, which, as noted above, was enacted in 1917 and prohibited a subscriber from subcontracting work "with the purpose and intention" of avoiding the liability for workers' compensation benefits he would have if his own employees were injured doing the work.
In three consecutive legislative sessions beginning in 1977, six bills were introduced, the ostensible purpose of which was to eliminate section 6's subjective "purpose and intention" trigger and provide greater certainty in determining whether a subscriber should be treated as the statutory employer of his subcontractors and their employees. The premise of the bills was that subscribers were being treated as statutory employers already, but not always predictably or consistently. The bills proposed to amend or replace section 6 and provide, variously, either that coverage extended to subcontractors unless otherwise agreed, that coverage did not extend unless otherwise agreed, or something in between. In brief:
None of these bills defined a general contractor or distinguished between one who owned the jobsite and one who worked for the owner. All seemed to treat any subscriber who engaged a subcontractor as a general contractor, though none specifically said so. Nothing in any of the bills suggested that a subscriber who engaged
In 1983, HB 1852 as introduced, like the bills the prior session, would have deleted existing section 6 and provided that a prime contractor's workers' compensation insurance coverage would not extend to a subcontractor or his employees except by agreement.
And section 6(b) defined "subcontractor" to mean "a person who has contracted to perform all or any part of the work or services which a prime contractor has contracted with another party to perform."
By referring to a prime contractor as someone who works for another, the definition of "subcontractor" would exclude an owner. But if the meaning of "prime contractor" defined in section 6(c) is to be informed by the definition of "subcontractor" in section 6(b), it must also be informed by section 6(d), which refers to the person who engages a subcontractor as a subscriber, a term that includes an owner acting as his own general contractor. Section 6(d) applies to all subscribers. If sections 6(a)-(c) were read to address only the situation in which the subscriber and prime contractor is not the owner, no ambiguity in the meaning of "prime contractor" would exist. Section 6(d) would have general application, while the other sections would not. The effect of HB 1852 was to provide greater certainty in one area, even if a comprehensive solution remained beyond reach. But if sections 6(a)-(c) were also of general application and prescribed the requirements for considering any prime contractor to be the statutory employer of subcontractors and their employees, then the ambiguity in the meaning of "prime contractor" would be unavoidable. Moreover, that construction of the statute would raise the question why a prime contractor who owns the jobsite should, like all other prime contractors, be prohibited from trying to avoid liability for workers' compensation benefits, but unlike all other prime contractors, not be allowed to provide such benefits.
In any event, the law regarding statutory employers was not clear before 1983, as evidenced by the variety of efforts to clarify it, and it was not much clearer after 1983.
I do not mean to suggest for a moment that the drafting history of the 1983 statute is relevant in determining the Legislature's intent by enacting it. The various bills and amendments do not reveal even the sponsors intentions, let alone the Legislature's. But the history of the legislation
Thus, the argument that the 1989 change in the definition of "subcontractor" was not substantive because it was made without comment could be correct, but it is not clear what the law was before the change. The 1983 definition referred to "work or services which a prime contractor has contracted with another party to perform". The 1989 definition referred to "work or services which a prime contractor has undertaken to perform". The dissent argues that the Legislature used "undertaken" to mean the same thing as "contracted with another party", but it is just as likely that the Legislature used "undertaken" because it was more accurate and removed an ambiguity in the 1983 statute. The point is that the argument that the 1989 change was not substantive because it was not controversial proves nothing because the backdrop against which it appeared was itself unclear.
Finally, a number of bills introduced between 1995 and 2005 would have clarified who is a statutory employer on construction jobsites.
* * *
Respondent and the amici curiae that support his position argue that the statutory construction urged by petitioner is bad policy. We have no way to judge such matters and do not do so. Underlying many of their arguments is a conviction that the workers' compensation system is basically unfair. That issue also is not ours to judge. We must presume that the system is just and reasonable.
Justice WILLETT filed a concurring opinion.
Justice WILLETT, concurring.
In times of political rancor, vengeful motives are swiftly attributed (and swiftly believed). This is unfortunate, but also unaffecting. The judiciary, rightly understood, is not a political institution but a legal one, meaning we must decide cases on the basis of principled legal points, not political talking points.
This appeal constitutes something of a legal Rorschach test: People see in it what they wish, and one person's commendable restraint is another's condemnable activism. Here, one side (Entergy) contends that judicial restraint requires a plain-language reading of the statute, that the surest manifestation of legislative will is found in legislative text. The other side (Summers)
My view is uncomplicated: The law begins with language, and it smacks of Lewis Carroll when critics, voices raised high in derision, inveigh against "judicial activism" because judges refrain from rewriting the text lawmakers chose. This side of the looking glass, reading a statute as enacted is the nadir of activism, not its zenith. It must be stressed that even one of Summers' amicus supporters concedes the statute can be read in Entergy's favor
I agree with the Court's bottom-line result (and a good deal, though not all, of its analysis), but I write separately because this case raises important issues regarding statutory construction, and the judicial role more generally, that deserve fuller, more head-on treatment.
I. Introduction — Whether Entergy Can Qualify As a "General Contractor"
Today's issue is simply stated but sharply disputed: Can a premises owner qualify as a "general contractor" under the Texas Workers' Compensation Act? Amid the spirited debate, two preliminary matters are unchallenged: (1) premises owners who provide workers' compensation insurance coverage to their own employees are statutorily immune from tort suits over work-related injuries; and (2) general contractors who cover their subcontractors' employees are also immune. Today's case presents a hybrid — whether a premises owner can serve as its own general contractor and assert the same exclusive-remedy defense as a contract employer that it asserts as a direct employer.
Two things should drive our analysis — the Legislature's language, which is open-ended, and this Court's role, which is not. We must respect policy-laden statutes as written and give wide leeway to the innumerable trade-offs reflected therein. The Act's definition of "general contractor" is sweeping ("a person who undertakes to procure the performance of work") and carves out only one narrow exclusion ("a motor carrier that provides a transportation service through the use of an owner operator"). The wording is inclusive in
I agree with the Court. By "undertak[ing] to procure the performance of work," Entergy meets the Legislature's brief-but-broad definition. This, coupled with Entergy's provision of workers' comp coverage, confers statutory-employer status.
II. The Legislature's Chosen Words Dictate the Outcome
The Act's controlling provisions are straightforward:
A. Legislative intent is revealed by legislative language
There is one building-block principle this Court has declared repeatedly and emphatically: the "surest guide" to what lawmakers intended is what lawmakers enacted.
Consequently, we must focus on what a statute says and, just as attentively, on what it does not say, taking care to honor substantive changes, both additions and deletions, made over the years, and always presuming that the Legislature chose its language carefully.
B. The court of appeals disregarded the Act's key provisions
1. it ignored the specific definition of "general contractor"
The court of appeals held "Entergy did not establish it had undertaken to perform work or services and then subcontracted part of that work to IMC, as a general contractor would have done."
Contrary to the suggestion in Williams that an owner cannot double as a general contractor because it cannot contract with itself, the statute does not blanketly exclude premises owners who otherwise meet the Act's undemanding criteria.
The legal test for determining whether Entergy can invoke the exclusive-remedy defense is not whether the statute explicitly includes "owners." The test is a simple one: Does Entergy meet Chapter 406's eligibility criteria? The record shows clearly that Entergy "[undertook] to procure the performance of work" from IMC.
2. it utilized a long-discarded definition of "subcontractor"
The court of appeals in this case (and the Williams court) also erred in relying on Wilkerson v. Monsanto Co., a federal district court decision holding that a premises owner cannot be a statutory employer (because it cannot be a general contractor).
Assuming Wilkerson was correctly decided, it lacks any interpretive force today, for a simple reason: Wilkerson turned entirely on four words the Legislature removed during its 1989 substantive rewrite.
prime/general contractor subcontractor
---------------------------------------------------------------------------------------------------------------
pre-1989 "the person who has undertaken to procure "a person who has contracted to perform
the performance of work or services" and all or any part of the work or services
"`prime contractor' includes `principal contractor,' which a prime contractor has contracted
`original contractor,' or `general with another party to perform"109
contractor' as those terms are commonly
used"110
-------------------------------------------------------------------------------------------------------------- current "a person who undertakes to procure the "a person who contracts with a general performance of work or a service.... The contractor to perform all or part of the term includes a `principal contractor,' `original work or services that the general contractor contractor,' `prime contractor,' or other has undertaken to perform"111 analogous term. The term does not include a motor carrier that provides a transportation service through the use of an owner operator"112 --------------------------------------------------------------------------------------------------------------key change current definition excludes a single class of current definition no longer imposes an otherwise eligible persons: certain motor "upstream contract" condition on general carriers, nobody else contractors --------------------------------------------------------------------------------------------------------------
As seen above, the 1989 reform bill deleted "contracted with another party," the critical upstream-contract phrase that anchored Wilkerson and suggested a premises owner could not wear the hat of general contractor. The before-and-after comparison is difficult to brush aside. While the 1983-1989 Act indicated that a contractor undertook action on behalf of someone else (the owner), the Legislature in 1989 removed that upstream inference. Our cases require us to treat such omissions as meaningful and not meaningless,
Summers urges a construction rooted in now-repealed language. While conceding that "contracted with another party" appears nowhere in the current statute, Summers insists the upstream-contract notion was not deleted but transplanted, subsumed now by the phrase "undertakes to procure" in the definition of "general contractor." This contention — that the upstream-contract condition was moved but not removed — is facially counterfactual, betrayed by this inconvenient truth: "undertake[ ] to procure" also appeared in the pre-1989 definition. Even though this phrase predated the 1989 overhaul, Summers argues it became implicitly freighted with what was once explicitly stated (in a different definition). This argument is unpersuasive. Updated criteria require updated analysis. It is untenable that the four words so important in Wilkerson were, though deleted, imported into three words that predated Wilkerson. Summers' argument would reinsert what lawmakers took out and declare this part of a massive modernization bill — the part that anchors the precedent upon which Summers
We cannot treat the upstream-contract language in the 1983-1989 Act as mere surplusage and its 1989 deletion a nullity. Nor does the dissent pivot on Summers' argument that "undertakes to procure" necessarily implies an upstream obligation and must be read as "undertakes to procure for someone else." The deletion of something explicit means more than the retention of something implicit. Indeed, several Texas statutes use "undertake" to describe a person acting to benefit himself.
III. Settled Precedent Bars Summers' Extratextual Arguments
Summers and his aligned amici contend that several factors outside the Act's actual language support a more flexible statutory reading. The Court correctly rejects these arguments, and notably the dissent implicitly does likewise.
A. Failed bills predating and postdating the Act's 1989 overhaul carry no interpretive force
Summers and various amici exhort us to construe language that passed in light of language that failed to pass. As the Court makes clear, we cannot. Precedent from both the United States Supreme Court and from this Court counsel against supplanting unequivocal enacted text with equivocal unenacted inferences drawn from failed legislation.
First, counsel supporting Summers direct us to the 1989 overhaul effort itself. It is undisputed that the 71st Legislature was consumed with the task of restructuring the State's then-76-year-old workers' compensation system.
This argument is unavailing, as the United States Supreme Court recently explained: "It is always perilous to derive the meaning of an adopted provision from another provision deleted in the drafting process."
Second, counsel supporting Summers ask us to examine post-1989 legislative efforts and conclude that intent to bar premises owners from invoking statutory-employer immunity is implicit in the Legislature's consideration, but not adoption, of various bills since 1989 related to premises-owner liability.
We cannot draw such an inference for two reasons. First, the Act itself controls, and its definitions include no such exclusion. Far more probative than proposed legislation is passed legislation, what the people's elected representatives actually enacted as a collective body. The Legislature's "broad definition, narrow exception" approach to "general contractor" and deletion of the upstream-contract language constitute dual reasons for not barring dual roles for those meeting the Act's liberal definitional criteria.
Second, we eschew guesswork, and a bill's failure to pass sheds no light because, as even casual Capitol observers know, bills fall short for countless reasons, many of them "wholly unrelated" to the bill's substantive merits or "to the Legislature's view of what the original statute does or does not mean."
Even if our precedent allowed us to conflate inaction with intention, the bills, as the Court notes, were not only unsuccessful but immaterial. The bill that comes closest, Senate Bill 1404 from the 76th Legislature in 1999, would have amended "general contractor" to include "an owner or lessor of real property."
As for Senate Bill 1404, the legislative record is completely bare as to the individual sponsor's (or anyone else's) objective. The bill was referred to committee and then left pending; no hearing, no testimony, no bill analysis, no action whatsoever. Even if the bill were on all fours, a single bill — filed the day before the filing deadline
B. Neither purposive analysis nor off-the-mark representations regarding legislative history can trump the Legislature's enacted text
On a related front, amici supporting Summers exhort us to throw off our interpretive "shackles" and embrace a "thorough" and "expansive methodology" that relies on various interpretive tools that look beyond the Legislature's chosen language. Given the lack of textual ambiguity, I reject this eclectic approach.
Notably, the dissent, while siding with Summers, also declines this nontextual approach. True, we periodically consult external materials when text is nebulous and susceptible to varying interpretations, but
Indeed, this case demonstrates vividly the perils of uncritical reliance on legislative history. It is distressing that those citing the legislative record in this case sometimes do so:
C. The Act is not "absurd" if injured deemed employees receive the same relief as injured direct employees
Summers insists we must adopt a relaxed interpretation more consonant with fairness because reading "general contractor" to limit contract workers to the same recovery that direct workers receive would render the term "meaningless and absurd."
Under Summers' reading, a separate contractor would escape tort liability, but a premises owner who performs every contracting-related chore the separate contractor would perform would not. More to the point, a general contractor that oversees work on its own property could not qualify as a general contractor under the Act. That was perhaps true in the 1983-1989 Act, as Wilkerson held, but the Legislature's top-to-bottom rewrite amended the law.
One can complain that current comp benefits are inadequate, but it is unpersuasive to equate equality — direct and contract employees receiving the same benefits when the employer owns the jobsite — with absurdity.
D. Judges have no authority to second-guess the myriad policy judgments codified in the Workers' Compensation Act
The 1989 restructuring of the Texas workers' compensation scheme — labeled "the most divisive legislative endeavor in contemporary Texas politics"
Laid bare, Summers' core complaint is that benefits under the Act are too stingy. We are ill-equipped to assess this charge. The Act, whatever its alleged shortcomings, embodies century-old public policy, and courts must read the Legislature's words as enacted, not revise them as desired. "The wisdom or expediency of the law is the Legislature's prerogative, not ours"
It may be correct that lawmakers in 1989 did not intend to permit a dual-hat role for premises owners. Workers' comp reform was a Herculean, multiple-session undertaking, one made tougher with short deadlines for drafting and short fuses for drafters. Heaven knows laws sometimes pass quickly amid urgent circumstances with scant discussion, yielding untoward ramifications over time. Recent examples of voting-without-reading abound, including the newly passed $789,000,000,000 (and 1,073-page) American Recovery and Reinvestment Act of 2009, which provided "a
Even when laws are meticulously drafted and thoughtfully debated, legislative handiwork must often bend to a still more powerful force: the law of unintended consequences.
Legislative text is often elastic, like the "general contractor" definition in this case, but the judicial role is not. When divining what lawmakers intended to do, we must focus on what they in fact did do and presume they meant what their words mean. Where language is not unclear, a judge's doctrinal toolbox is limited. I do not share the view that reliance on text is pretext, that reading laws as written is mere figleafing to disguise judicial willfulness aimed at imposing ideologically congenial results. Purposive decisionmaking is achieved more readily (and easily) by straying from text than by sticking to it, and hewing to the Legislature's as-written language has repeatedly led me to results I strongly dislike.
Obviously, if lawmakers in 2009 (or later) dislike the Court's interpretation of the words their 1989 predecessors chose — or believe their predecessors drafted with imprecision — the remedy, and it is a simple one, rests wholly with them. This is precisely how the separation of powers works among co-equal branches of government. The presumption that lawmakers intended what they enacted is not just required and well-settled but desired and well-founded. It is an accommodation rooted in carefulness, not certitude. The Legislature can easily reinsert an upstream-contract
IV. A Brief Take on the Dissent
The Court briefly addresses the dissent's arguments, but more can be said. The dissent's chief contention is that lawmakers "expressly tethered" general contractor to other terms that are "commonly understood to mean a person who has contracted with an owner"
Like the Court, I find the dissent's argument unpersuasive, for several reasons. First, the dissent cites the "common usage" provision of the Code Construction Act
Second, the dissent looks for support in statutory definitions of "contractor" outside the Workers' Compensation Act that explicitly mention a third-party requirement.
Third, the dissent relies on two of our prior cases to assert we have "recognized for almost a century that a contractor" has a third-party requirement.
Finally, the absence of "owner contractor" from a list the dissent concedes is nonexhaustive
V. A Brief Take on JUSTICE HECHT'S Concurrence
If my understanding is correct, the dissenters reject their original view of the case and now insist a premises owner has never been entitled to statutory-employer status by providing comp coverage to subcontractors and their employees. Conversely, the Court and JUSTICE HECHT apparently believe that access to the exclusive-remedy defense by providing such coverage has been available perhaps since 1917, when a provision was added that is now section 406.124 of the Labor Code, and is certainly available today. My position, detailed above, is that the defense was made available in 1989, when lawmakers removed third-party language from the Act.
The Court's and JUSTICE HECHT'S attention to section 406.124 and its earlier enacted versions is unhelpful (and unnecessary in my view given the deletion in 1989 of the upstream-contract language). Section
Section 406.124 is a rarely employed subterfuge provision intended to thwart sham attempts by an employer to mischaracterize an employee as a subcontractor and thereby avoid comp liability. It says as much — applying to all statutory employers and targeting efforts to evade liability. The general-contractor provision at issue in today's case, currently section 406.123, addresses the separate matter of extending statutory-employer status to a general contractor who retains a legitimate, independent subcontractor and wishes to cover the subcontractor's employees. The general-contractor provision was added in 1983, and substantively rewritten in 1989, as I discuss above.
I essentially agree with JUSTICE O'NEILL on this point. None of the parties rely on section 406.124, and it is irrelevant to the key inquiry: whether a premises owner can be a general contractor under section 406.123. The latter provision has never applied to all subscribers, but is limited to general contractors. Today's issue is whether a premises owner can fall within the definition of "general contractor," a subset of all subscribers.
So while I agree with the Court's result and most of its reasoning, I part company with the Court and JUSTICE HECHT on the relevance of the subterfuge provision and its history, even though the changes to this provision and the eventual enactment of the general-contractor provision share a common legislative ancestry to some extent. In short, I see less ambiguity than JUSTICE HECHT does in the general-contractor and subcontractor definitions. (Interestingly, he attaches no significance to the Legislature's 1989 deletion of "contracted with another party.") If anything, his meticulous effort to lay out the history of sections 406.123 and 406.124 and their interplay convinces me, more than ever, that we should focus on the text as enacted (and amended) and resist entreaties to meditate on the varying motives and atmospherics that may have spurred the thousand-plus Texas legislators who have dealt with workers' compensation over the past ninety-six years. I simply do not share JUSTICE HECHT'S "ambiguity" diagnosis,
For the reasons discussed in Parts I-IV above, I disagree that the Act can be read either way and thus requires a gestalt examination of a near-century of legislative machinations for whatever authoritative lessons can be gleaned from that odyssey, interesting though it may be.
VI. Conclusion
Courts are charged with exercising judgment, not will,
The Court has reached the correct result, and for the reasons discussed above, I join all but Parts IV, V, and VIII of its decision.
Justice O'NEILL, filed a dissenting opinion in which Chief Justice JEFFERSON and Justice MEDINA joined.
Justice O'NEILL, dissenting, joined by Chief Justice JEFFERSON and Justice MEDINA.
The Court today concludes that premises owners who pay (and recoup) their subcontractors' workers' compensation premiums are, and have always been, entitled to the Workers' Compensation Act's exclusive-remedy defense against their subcontractors' injured employees. The Court pins its analysis on a 1917 provision that was designed to prevent "subscribers" from creating sham subcontractor relationships in order to avoid covering their own injured employees. Remarkably, neither the parties nor the dozens of amici curiae in this case have proffered such an interpretation. Although the Court concludes that the law in this regard has remained essentially the same since 1917, the Legislature first afforded a general contractor that "ha[d] contracted with another party to perform" work the right to voluntarily assume statutory employer status in 1983. Had all "subscribers" always been statutory employers of subcontractors' employees, this statutory revision and its 1989 iteration would make no sense.
The parties and amici appear to agree, as do I and Justice Willett, that before 1989 premises owners were not "general contractors" under the Act. The appropriate inquiry, then, is not whether the 1989 "general contractor" definition excludes premises owners, as the Court posits, but whether the Legislature intended to change prior law by expanding the definition to include premises owners when it rewrote the Act in 1989 and expressly tethered the term to others commonly understood to mean a person who has contracted with an owner. Had the Legislature intended to change the law in 1989 and for the first time afford premises owners the exclusive-remedy defense against subcontractors and their employees, it would surely have been simpler to say so by using the broader term "subscriber," or by including the term "owner contractor"
A few points bear noting at the outset. First, whether workers' potential recovery is greater under the common law or the Workers' Compensation Act, and whether one scheme promotes workplace safety over the other, is a legislative call, not ours. Second, one cannot contract into the Act's protections if the Legislature did not intend to allow it; accordingly, that Entergy reserved any right it might have to assert a statutory-employer defense against IMC's employees, or that Summers accepted workers' compensation benefits paid for by Entergy (and deducted from the contract price), does not inform the statutory analysis. And finally, whether premises owners should be afforded the Act's protections by paying their general contractor's workers' compensation premiums, as general contractors are by paying the premiums of their subcontractors, is a policy choice we are not at liberty to make.
As the Court notes, this case has drawn much attention since our initial opinion, and numerous amici have weighed in. When this case was first presented, Summers' emphasis was on Entergy's proof regarding the existence of a written agreement and mistaken reliance on the Legislature's 1993 nonsubstantive recodification of the Labor Code. On rehearing, a more focused analysis of the applicable statutory text convinces me that the Legislature, in rewriting the Act in 1989, did not intend to change the general-contractor definition to include premises owners; to the contrary, it tied the definition to terms commonly understood to mean a person who has contracted with an owner. It might well represent sound policy to allow premises owners to become statutory employers of their contractors' employees by providing workers' compensation coverage, potentially expanding the number of employees eligible to receive benefits under the Act.
I.
A. The Statutory Text
Under section 406.123 of the Act, "a general contractor and a subcontractor may enter into a written agreement under which the general contractor provides workers' compensation insurance coverage to the subcontractor and the employees of the subcontractor." TEX. LAB.CODE § 406.123(a). If such an agreement is reached and properly filed, the general contractor may deduct premiums from the amount owed the subcontractor without incurring penalties under section 415.006
Id. § 406.121(1). A subcontractor, in turn, is "a person who contracts with a general contractor to perform all or part of the work or services that the general contractor has undertaken to perform." Id. § 406.121(5). A close analysis of these definitions, particularly viewed in light of controlling statutory construction principles, compels the conclusion that the Legislature did not intend to allow a premises owner to assume general-contractor status and assert the Act's exclusive-remedy defense against subcontractors and their employees at no additional cost to itself.
In construing a statute, our overarching purpose is to determine and effectuate the Legislature's intent. State v. Shumake, 199 S.W.3d 279, 284 (Tex.2006) (citing City of San Antonio v. City of Boerne, 111 S.W.3d 22, 25 (Tex.2003)). The surest guide to that intent is, of course, the plain and common meaning of the language the Legislature has employed. City of Houston v. Clark, 197 S.W.3d 314, 318 (Tex. 2006) (citing McIntyre v. Ramirez, 109 S.W.3d 741, 745 (Tex.2003)). Treating premises owners who provide workers' compensation coverage to subcontractors and their employees as "general contractors" is inconsistent with the common meaning associated with the terms to which the definition is tied.
Throughout Texas statutory and common law, a contractor is generally understood to be a person or entity that enters into a contract with another for compensation. In interpreting the Act and its predecessors, we have for decades defined a contractor as "`any person who, in the pursuit of an independent business, undertakes to do a specific piece of work for other persons ....'" Indus. Indem. Exch. v. Southard, 138 Tex. 531, 160 S.W.2d 905, 907 (1942) (quoting Shannon v. W. Indem. Co., 257 S.W. 522, 524 (Tex. Comm'n App. 1924, judgm't adopted)) (emphasis added).
The illustrative language the Legislature included in the Workers' Compensation Act's "general contractor" definition is consistent with that general understanding: "principal contractor," "original contractor," and "prime contractor" are all terms that envision a tripartite relationship in which one entity enters into a contract to perform work for another and then retains subcontractors or independent contractors to do all or part of the work. See, e.g., TEX. PROP.CODE § 53.001(7), (13) ("`Original contractor' means a person contracting with an owner either directly or through the owner's agent," and "`[s]ubcontractor' means a person who has furnished labor or materials to fulfill an obligation to an original contractor or to a subcontractor to perform all or part of the work required by an original contract."); Interstate Contracting Corp. v. City of Dallas, 135 S.W.3d 605, 611-12 (Tex.2004) (using the term "prime contractor" interchangeably with "general contractor" in discussing pass-through claims); Page v. Structural Wood Components, Inc., 102 S.W.3d 720, 721-22 (Tex.2003) (using the term "general contractor" interchangeably with "original contractor" in interpreting chapter 53 of the Property Code);
The Court insists that the statutory definition controls over what it tacitly acknowledges is the commonly understood meaning of the term "general contractor." But the Legislature itself has mandated that "[w]ords and phrases shall be ... construed according to ... common usage," and that "[w]ords and phrases that have acquired a technical or particular meaning, whether by legislative definition or otherwise, shall be construed accordingly." TEX. GOV'T CODE § 311.011(a), (b). In this instance, common usage, the common law, and a host of legislative pronouncements are contrary to the meaning the Court attaches to the term. More importantly, the statutory language itself comports with, and is tied to, the general understanding of the term's meaning. When the Legislature enacted section 406.121, we had long defined a contractor as one who "`undertakes to do a specific piece of work for other persons....'" Southard, 160 S.W.2d at 907 (quoting Shannon, 257 S.W. at 524 (emphasis added)). And Black's Law Dictionary, at the time the Legislature adopted the general-contractor definition, similarly defined a contractor as "a person who, in the pursuit of any independent business, undertakes to do a specific piece of work for other persons...." BLACK'S LAW DICTIONARY 295 (5th ed.1979). It also stated that "[t]his term is strictly applicable to any person who enters into a contract, but is commonly reserved to designate one who, for a fixed price ... undertakes to procure the performance of works or services ... for the public or a company or individual." Id. (emphasis added). In other words, a contractor is someone who receives payment for performing work for another. Section 406.121(1) precisely tracks these definitions by describing a general contractor as one who "undertakes to procure the performance of work or a service, either separately or through the use of subcontractors." TEX. LAB.CODE § 406.121(1). In light of this longstanding commonly understood usage, the Legislature could easily have defined "general contractor" to include premises owners if that was its intent, but it did not. Had the Legislature intended the term to be as conceptually broad as the Court and Justice Hecht today say it is, it could simply have written that "a subscriber and a subcontractor may enter into an agreement," but again, it did not.
The Court attaches a similarly strained meaning to the term "separately" within the general-contractor definition. ("`General contractor' means a person who undertakes to procure the performance of work or a service, either separately or through the use of subcontractors.") Id. That is, the Court says that a premises owner acts "separately" when it engages subcontractors directly rather than through a general contractor. 282 S.W.3d at 441. But "separately" far likelier alludes to independent contractors, as opposed to subcontractors, terms which the Legislature defined differently in the same bill that introduced the "separately" language. See Act of Dec. 12, 1989, 71st Leg., 2d C. S., ch. 1, § 3.05, 1989 Tex. Gen. Laws 1, 15 (codified at TEX. LAB.CODE § 406.121(2)).
Significantly, the Legislature used almost identical "undertake to procure" language in the prior version of the statute when conferring statutory-employer status on prime contractors who provided workers' compensation coverage to their subcontractors. Act of May 28, 1983, 68th Leg., R. S., ch. 950, § 1, 1983 Tex. Gen. Laws 5210, 5210, amended by Act of Dec. 12, 1989, 71st Leg., 2d C.S., ch. 1, § 3.05(a)(5), 1989 Tex. Gen. Laws 1, 15. The prior statute equated the term "prime contractor" with "general contractor," and defined it to mean "the person who has undertaken to procure the performance of work or services." Id. The definition of "subcontractor" in the same legislation left no doubt that the language embraced the commonly understood meaning of a contractor as one who has agreed with another to perform work or services in exchange for compensation. "[S]ub-contractor" was defined as a person who has contracted to perform all or part of work or services that "a prime contractor has contracted with another party to perform." Id. (emphasis added). Despite the clarity of that language, the Court and Justice Hecht conclude that the 1983 general-contractor definition could be read to encompass premises owners who have not contracted with other persons to perform work. Apparently, they believe only third-party language within the general-contractor definition itself would demonstrate legislative intent to exclude premises owners.
Justice Willett, and the Court to some extent, make much of the Legislature's omission in 1989 of the third-party language, concluding that the Legislature meant to abolish the "`upstream contract' condition." It is hard to fathom that such a sweeping and deliberate change in the law would be so subtly effected. But if that had been the Legislature's intent, it would not have substituted "undertaken to perform" language that had long been recognized in the general-contractor definition as imposing a third-party obligation. The Legislature's use of the same language in the old and new general-contractor definitions strongly indicates it intended the same meaning in each version.
Reliance on omission of the third-party language in the subcontractor definition is misplaced for yet another reason. It is true that the Legislature is presumed to act with knowledge of existing laws, Acker v. Tex. Water Comm'n, 790 S.W.2d 299, 301 (Tex.1990), and that deletions in existing laws are presumed to be intentional. In re Ament, 890 S.W.2d 39, 42 (Tex.1994). But the 321-page workers' compensation bill enacted in 1989 did not merely amend prior laws, it massively overhauled the entire workers' compensation scheme. While portions of the bill amending the Insurance Code, the Government Code, and other measures related to workers' compensation indicated deletions with bracketed strikeouts, articles 1 through 11 of the bill comprising the Workers' Compensation Act itself contained no such indications of omissions. See Tex. S.B. 1, art. 1-11, 71st Leg., 2d C.S. (1989) (codified as amended at TEX. LAB. CODE, Title 5, Subtitle A); see also Tex. Legislative Council Drafting Manual 35-36 (2008), available at http://www.tlc.state.tx.us/legal/dm/draftingmanual.pdf. Thus, omission of the third-party language from the subcontractor definition does not merit the weight the Court and Justice Willett afford it. Because "contract[ing] with another party" is inherent in the nature of general contractors and analogous terms, and because the concept had been subsumed in the definition of "prime contractor" and "general contractor" as "the person who has undertaken to procure the performance of work or services," the third-party
Giving virtually no effect to the Legislature's restriction of "general contractor" to terms analogous to "principal contractor," "original contractor," and "prime contractor," the Court and Justice Willett attach great significance to the sentence excluding motor carriers that provide transportation services through the use of owner-operators. But when that exclusion is viewed in the context of the entire statutory scheme and other law applicable to motor carriers, the reason for the exclusion becomes clear: in the 1989 rewrite of the Act, the Legislature made some, but not all, of section 406.123 applicable to motor carriers. Like general contractors and subcontractors, motor carriers and owner-operators (which are deemed independent contractors under section 406.121(4)) may enter into an agreement under which the motor carrier provides workers' compensation coverage to an owner-operator and its employees. TEX. LAB.CODE § 406.123(c). And like a general contractor, a motor carrier that provides workers' compensation coverage to its independent contractor may deduct the premium from the contract price without incurring penalties under section 415.006 of the Act. Id. § 406.123(d). But unlike general contractors, a motor carrier that provides coverage to its independent-contractor owner-operator does not become the statutory employer of the owner-operator or the owner-operator's employees — there is no provision equivalent to section 406.123(d) that applies to motor carriers. This differing treatment of motor carriers is consistent with section 5.001(a)(2) of the Transportation Code, which restricts the ability of common carriers to limit their common law liability. It may also be attributable to the heightened standard of care imposed upon common carriers in light of their potential impact on public safety and their highly regulated status. See Speed Boat Leasing, Inc. v. Elmer, 124 S.W.3d 210, 212 (Tex.2003); S. States Transp., Inc. v. State, 774 S.W.2d 639, 642 (Tex.1989) (GONZALEZ, J., dissenting). One could argue that motor carriers are analogous to general contractors, in that they frequently contract with third parties to provide transportation services and then subcontract with owner-operators to actually perform those services. Thus, the Legislature likely expressly excluded motor carriers from the general-contractor definition to make it clear that, even though they might otherwise fit the general-contractor construct, they are to be treated differently.
C. Justice Hecht's Policy-Based Interpretation
Noting that a property owner may act as its own general contractor, but acknowledging that the term is more generally understood to mean one who contracts with a property owner and then subcontracts parts of the job to others, Justice Hecht concludes that we just can't tell from the statutory language what the Legislature meant. Finding the text elusive, Justice Hecht discerns "policies embedded in the Act" which he believes tip the scales in favor of treating a premises owner as a general contractor. There are several problems with this approach. First, while the definition of a "general contractor" as one who "undertakes to procure the performance of work" may in isolation appear open-ended, the definition's second sentence ties the term to its commonly understood meaning. Second, if indeed the text is ambiguous as Justice Hecht claims, we have clearly said that statutes in derogation of common law rights should not be "`applied to cases not clearly within [their] purview.'" See Energy Serv. Co. of Bowie,
The first policy that Justice Hecht believes sweeps premises owners into the general-contractor definition is the Act's "decided bias" for coverage. See Wingfoot Enters. v. Alvarado, 111 S.W.3d 134, 140 (Tex.2003). But the Act's bias is in favor of employers electing to provide coverage for their employees; we have never read a bias into the Act that would confer its protections on third parties absent clear statutory authorization or any indicia of an employer/employee relationship. The Act's general policy that favors employers covering employees cannot expand the category of persons considered "general contractors" beyond the statutory definition; invoking that policy here is particularly unwarranted when the Legislature could so easily have defined the term as expansively as the Court and Justice Hecht do today.
The second policy Justice Hecht cites is the sham-subcontractor provision. See TEX. LAB.CODE § 406.124. If the Act prohibits subscribers from utilizing subcontractors to avoid coverage, he posits, it surely would not discourage coverage by denying subscribers the exclusive-remedy defense. But the sham-contractor provision was never intended to impute coverage to true third parties as Justice Hecht seems to imply; it simply prohibits a person who has workers' compensation coverage from subcontracting the work with the intent and purpose of avoiding liability as an employer. See id. In other words, an employer cannot designate its employee a subcontractor in order to avoid paying benefits under the Act. No one claims that IMC was hired by Entergy as a sham to avoid paying its own employees workers compensation benefits; the provision is simply irrelevant to analysis of the general-contractor definition.
Justice Hecht next charges that my reading of the statute would have "perverse" results because the contractual indemnity allowed under section 417.004 and provided for in Entergy's contract with IMC would permit Summers to recover common law damages from Entergy, which Entergy could in turn recoup from IMC. Justice Hecht suggests that in such a scenario, "the workers' compensation system provides nothing to any employer." Of course the pre-1989 Act, at least according to my reading (and that of the litigants, amici and Justice Willett), had the same effect, which is a policy choice the Legislature made. The question is whether in 1989 the Legislature intended to change that policy. In addition, several factors undermine Justice Hecht's point. One, while Entergy paid IMC's premiums for Summers' benefits under its owner-provided insurance plan (OPIP), that cost was deducted from the contract price paid to IMC, so Entergy effectively paid nothing for the additional protection Justice Hecht's reading would afford Entergy. Two, owners receive significant economic benefits from OPIPs like Entergy's apart from tort immunity. OPIPs allow owners to secure coverage for all their contractors at a lower overall price than the cost of workers' compensation insurance that subcontractors would normally incorporate into their contract prices, thereby lowering owners' overall costs. Howrey LLP, Owner Controlled Insurance Programs (OCIPs): Why Owners Like Them and Why Contractors May Not, CONSTRUCTION WEBLINKS, July 14, 2003, http://www.
The fourth policy reason Justice Hecht cites is that the Act was intended to be comprehensive. But again, it can only be comprehensive to the extent that the Legislature intended, and there is nothing in the 1989 revision that would indicate the Legislature's intent suddenly changed. Underlying Justice Hecht's analysis is an apparent assumption that Summers might recover a windfall against Entergy on his common law claims. But if Entergy is not Summers' employer under the Act, it retains the full panoply of defenses available to it under the common law, and Summers shoulders the burden of establishing the company's negligence with the consequent uncertainties of litigation. Should Summers prevail on his common law claims, which is far from certain, he would forfeit any benefits that he has received under the Act. Irrespective of the workers' compensation system's relative merits, which is not ours to decide, it has operated this way at least until the statutory revision in 1989; there is nothing to indicate the Legislature's revision was intended to effect a change.
D. Statutory Construction Principles
As I read the statutory language, it seems clear that the Legislature did not intend to transform premises owners who contract for third-party services into general contractors entitled to assert the Act's exclusive-remedy defense. But even if the language were less than clear, well-established statutory construction principles lead to the same conclusion. In a decision issued a week before the Court's original opinion in this case, we considered whether an indemnification agreement between a subscribing employer and another party could be enforced by that party's contractor even though the contractor had not executed the agreement. Superior Snubbing, 236 S.W.3d 190. The statute had formerly required only that such an agreement be "`executed by the subscriber'" to be enforceable, but in 1989 the Legislature changed the statutory language to require a written agreement "`executed ... with the third party.'" Id. at 191 (quoting TEX. LAB.CODE § 417.004). Although the revision appeared to require the signature of both parties, we concluded that the Legislature intended no change in the law and that the nonsignatory contractor could seek indemnification as an intended beneficiary of the agreement. Id. at 195. In concluding that the Legislature intended no substantive change in the law, despite the change in the statute's language, we relied largely on two statutory construction principles. First, we noted that the common law allows the intended beneficiary of a contract to enforce it, and that statutes in derogation of common law
The application of those same principles in this case demonstrates that the Legislature did not intend to expand the class of contractors entitled to claim statutory-employer status to include premises owners when it rewrote the Act in 1989. Nothing in the Act's legislative history suggests that the Legislature perceived an "evil" in the then-existing requirement that a person must have contracted to perform services for another to be a general or prime contractor. See Joint Select Committee on Workers' Compensation Insurance, A Report to the 71st Legislature (1988); Tex. Workers' Comp. Comm'n v. Garcia, 893 S.W.2d 504, 512-13 (Tex.1995) (discussing report). And to the extent the statute's language does not plainly entitle premises owners to assume statutory-employer status under these circumstances, Superior Snubbing counsels against that construction, as it would be in derogation of Summers' common law rights. 236 S.W.3d at 194 n. 17; see also Kroger Co. v. Keng, 23 S.W.3d 347, 349 (Tex.2000) ("[I]t would be injudicious to construe the statute in a manner that supplies by implication restrictions on an employee's rights that are not found in section 406.033's plain language.") (citing Miears v. Indus. Accident Bd., 149 Tex. 270, 232 S.W.2d 671, 675 (1950)).
The Court may perceive that it has managed to blur the inconsistency between its decision today and Superior Snubbing by proclaiming that the law has remained unchanged since 1917. 282 S.W.3d at 490. But its own analysis shows how hollow that statement is. The Court acknowledges that an entirely new provision was introduced in 1983, and then amended in 1989. And the Court attaches some significance to the omission of the phrase "with another party" from the subcontractor definition in 1989. 282 S.W.3d at 473. In Superior Snubbing, the Court concluded that the Legislature's insertion of a phrase failed to demonstrate legislative intent to change the law absent a showing of any specific motivation. Here, the record is similarly devoid of any showing of an "evil" in need of remedy, yet the Court concludes that the omission of the "with another party" language effected a sweeping change in the law.
Justice Hecht recognizes the tension between today's decision and Superior Snubbing, but brushes it aside because "it has never been clear when a person is considered the statutory employer of a subcontractor or his employees...."
The Court's conclusion that premises owners are subsumed within the general-contractor definition is also inconsistent with another statutory construction principle we have frequently employed. Just four months ago, we analyzed section 101.022(b) of the Texas Civil Practice and Remedies Code to determine whether loose gravel on a road amounted to a special defect. Tex. Dep't of Transp. v. York, 2008 WL 5105254 (Tex.2008). The statute we evaluated imposed a heightened duty on governmental units to warn of special defects "such as excavations or obstructions on highways, roads, or streets" of which they should have been aware. TEX. CIV. PRAC. & REM.CODE § 101.022(b). We explained that while the statute did not define "special defect," it did give examples:
York. Because loose gravel did not share the characteristics of an obstruction or excavation, we held that it was not a special defect. Id. The application of York's principles in this case demonstrates that the Legislature did not intend to include premises owners within the Act's general-contractor definition. As already explained, a premises owner who is not performing work for another does not share the characteristics of a general contractor, a principal contractor, an original contractor, or a prime contractor. See also U.S. Fid. & Guar. Co. v. Goudeau, 272 S.W.3d 603, 606 (Tex.2008) ("Under the traditional canon of construction noscitur a sociis (`a word is known by the company it keeps'),
In support of its construction, the Court posits two workers injured in the same industrial accident receiving different compensation. The Court apparently considers it anomalous that a worker employed by the premises owner working side-by-side with a subcontractor's employee might be limited to workers' compensation benefits, while another employed by an independent contractor would be able to seek the full range of damages under the common law. First, to the extent such an anomaly exists under my reading of the statute, it is the result of policy choices made by the Legislature that long pre-existed the 1989 revision. Moreover, in implying that the result is somehow unfair to the premises owner's injured employee, the Court overlooks the option the Act provides employees of subscribing employers to elect not to be covered by workers' compensation. TEX. LAB.CODE § 406.034. It also overlooks the quid pro quo, being the relinquishment of uncertain common law recovery in exchange for the prompt receipt of defined benefits, that has insulated the Act from constitutional challenge under the Open Courts provision of the Texas Constitution. Garcia, 893 S.W.2d at 521.
II.
Because I do not believe that the Legislature in the 1989 Act intended to change prior law and confer statutory-employers status on premises owners, I respectfully dissent.
FootNotes
Act of Mar. 28, 1917, 35th Leg., R.S., ch. 103, § 1, Part II, sec. 6, 1917 Tex. Gen. Laws 269, 284-85. In 1983, HB 1852 amended the statute by adding a different provision using the term "prime contractor," defined to mean "the person who has undertaken to procure the performance of work or services." Act of May 28, 1983, 68th Leg., R.S., ch. 950, § 1, sec. 6, 1983 Tex. Gen. Laws 5210, 5210-11. Then, in 1989, the last major overhaul of the Act kept the "undertaken to" definition, but substituted the term "prime contractor" for "general contractor" and defined that person with the same language: "a person who has undertaken to procure the performance of work or services, either separately or through the use of subcontractors." Act of Dec. 12, 1989, 71st Leg., 2d C.S., ch. 1, § 3.05, 1989 Tex. Gen. Laws 1, 15. The 1917 "deemed employer" provision remains virtually unchanged in the current Labor Code, except the term "subscriber" has been replaced by the term, "person who has workers' compensation insurance coverage." Act of May 12, 1993, 73rd Leg., R.S., ch. 269, § 1, 1993 Tex. Gen. Laws 987, 1159 (current version at TEX. LAB.CODE § 406.124).
"(a) As used in this Act, the term sub-contractor means a person, firm, corporation or any other legal entity recognized under Texas law, contracting with the principal, original or prime contractor for the performance of all or any part of the work or services which such principal, original or prime contractor has contracted to perform.
"(b) Neither the sub-contractor nor the employees of the subcontractor shall be deemed employees of the principal, original or prime contractor for whom such sub-contractor is to perform work or services unless, prior to beginning the performance of any work or services to be performed under such sub-contract, subscriber and subcontractor have entered into a bona fide written contract expressly providing that the subscriber shall provide workers' compensation benefits to the sub-contractor or the employees of the sub-contractor while performing such work or services as if they were direct employees of the subscriber. The amount of the actual premiums paid or incurred by the subscriber for workers' compensation insurance coverage on such sub-contractor or the employees of the sub-contractor may be deducted from the contract price or any other monies due the sub-contractor.
Id.
Nor, as the Court stresses, 282 S.W.3d 433, can post-hoc statements by legislators shed light on what a statute means. See Consumer Prod. Safety Comm'n v. GTE Sylvania, Inc., 447 U.S. 102, 117-18, 100 S.Ct. 2051, 64 L.Ed.2d 766 (1980) (disregarding such statements about an earlier-passed statute: "the views of a subsequent Congress form a hazardous basis for inferring the intent of an earlier one"). The Legislature is composed of 181 diverse members representing diverse areas with diverse priorities; one lawmaker's perspective may be radically different than that of his or her 180 colleagues. See AIC Mgmt. v. Crews, 246 S.W.3d 640, 650 (Tex. 2007) (Willett, J., concurring) ("The statute itself is what constitutes the law; it alone represents the Legislature's singular will, and it is perilous to equate an isolated remark or opinion with an authoritative, watertight index of the collective wishes of 181 individual legislators, who may have 181 different motives and reasons for voting the way they do."); Gen. Chem. Corp. v. De La Lastra, 852 S.W.2d 916, 923 (Tex.1993) ("[T]he intent of an individual legislator, even a statute's principal author, is not legislative history controlling the construction to be given a statute."). This explains our consistent view — reinforced by the U.S. Supreme Court, see, e.g., Heller, 128 S.Ct. at 2805 — that post-passage actions and comments are immaterial:
In re Doe, 19 S.W.3d 346, 352 (Tex.2000) (quoting C & H Nationwide, Inc. v. Thompson, 903 S.W.2d 315, 328-29 (Tex.1994) (Hecht, J., concurring and dissenting) (citations omitted)). The very notion of "subsequent legislative history" is oxymoronic. After-the-fact comments may constitute history, and they may concern legislation, but they are not part of the legislative history of the original enactment. See Rogers v. Frito-Lay, Inc., 611 F.2d 1074, 1082 (5th Cir.1980). Judge Posner offers a grave caution: Judges who credit "subsequent expressions of intent not embodied in any statute may break rather than enforce the legislative contract." RICHARD A. POSNER, THE FEDERAL COURTS 270 (1985). Judges also risk getting snookered. See, e.g., Am. Hosp. Ass'n v. NLRB, 899 F.2d 651, 657 (7th Cir.1990) ("Post-enactment legislative history ... is sometimes a sneaky device for trying to influence the interpretation of a statute, in derogation of the deal struck in the statute itself among the various interests represented in the legislature. Courts must be careful not to fall for such tricks and thereby upset a legislative compromise.") (citations omitted). Finally, even proponents of legislative history, even those proponents willing to consider legislators' post-enactment comments, disregard statements from legislators who did not hold office when the disputed statute was enacted.
Another amicus brief contains at least two factual missteps in recounting the Legislature's 1989 deliberations. First, the brief inaccurately states, "In the draft bill considered during the regular session, immunity was extended to owners, as well as general contractors." The word "owner" never appeared during the regular session; it appeared in a House revision during the first-called special session. Tex. S.B. 1, 71st Leg., 1st C.S. (1989); see also H.J. of Tex., 71st Leg., 1st C.S. 76 (1989). The brief then errs again, stating "in the subsequent special session [the Legislature] removed premises owners from the list of actors granted immunity." Nobody in either chamber removed "owner" in the first-called special session; just the opposite, "owner" was momentarily added during this special session (and was absent from the bill adopted during the next session several months later). Id. Unless challenged by opposing counsel, such inaccuracies, however inadvertent, carry real potential to mislead judges and skew judicial decisionmaking.
Another brief follows suit, stating that during the first special session, after the House passed a bill that contained "owner," the Senate "refused to concur in the House amendments." While literally true — the Senate did in fact reject House changes — it suggests senators balked specifically at "owner." Not exactly. After the Senate passed Senate Bill 1, the House struck everything below the enacting clause, substituted an earlier House-passed version (which differed markedly from the Senate version) and sent it back across the rotunda. See H.J. of Tex., 71st Leg., 1st C.S. 76 (1989). Nothing suggests the Senate refused to concur because of "owner." In fact, a treatise (co-authored by the lead Senate sponsor) states the Senate's refusal rested on entirely separate issues. See MONTFORD, supra note 42, at 3 (noting consensus stalled due to "colossal differences in the dispute resolution and benefits proposals"). Still another brief asserts that "efforts in prior drafts to include the term `owner' were rejected." This wording suggests multiple targeted efforts to erase "owner" from pending drafts, but the lone mention of "owner" came in the first special session, in a bill that died over unrelated issues. The brief states a House amendment "specifically included the word `owner'" and the Senate "refused to concur in the House amendment, and the bill failed." The inference is misleading: the House amendment was not a rifle-shot inclusion of "owner" but a wholesale substitution of its earlier bill, with all the "colossal differences" noted by Senator Montford.
Senator Edwards: So in a case like the Phillips refinery explosion, if Phillips had been negligent and your amendment wasn't law, even though dozens of people were killed, Phillips wouldn't be liable in any way for their negligence?"
Senator Dickson: He would be immune. Would not be liable according to Senator Glasgow's construction and my reading of this new statute.
Id. Senator Dickson's pro-plaintiff amendment was later removed. This colloquy did not address whether "general contractor" included owners, but it is notable that Senator Edwards's hypothetical presumed the owner and the general contractor were one and the same. If that contradicted the Senate's collective intent, no senator rose to correct it. As Senator Dickson described his own amendment, it was to ensure that an owner's injured contract worker would not be limited to comp benefits. Summers says Senator Dickson was "simply confused" and later "got sort of educated" that the bill did not contemplate owners doubling as general contractors. The floor transcript reveals no such enlightenment.
While this discussion is not dispositive (or even relevant) — Senator Dickson's view is merely his alone, not fairly attributable to his 180 colleagues — it posed the issue presented here: a premises owner acting as a general contractor. If Senator Dickson was off-target because the Legislature never intended to let owners claim general-contractor status, no senator called it to the Senate's attention. The only reason I mention it is to stress how manipulable legislative history can be (by lawyers and judges alike), and that its indeterminacy is only made worse by the selectivity with which it is utilized.
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