American Motorists Insurance Company v. Fodge
In American Motorists Insurance Company v. Fodge, 63 S.W.3d 801 (Tex. 2001), the carrier initially denied the claimant compensation benefits. Id. at 802.
However, after an officer at a contested case hearing found that Fodge had suffered a compensable injury, she and the carrier stipulated that her disability lasted 20 days, the hearing officer ordered payment of temporary income benefits, and the carrier complied. Id.
Fodge never sought or complained about the carrier's denial of medical benefits. Id. She then sued the carrier, alleging that the carrier had denied and delayed payment for medical benefits, had underpaid and delayed payment of the awarded income benefits, and had failed to pay her additional income benefits that were never awarded. Id.
The carrier filed a motion to dismiss, arguing that the claims were based on a denial of benefits that only the TWCC has jurisdiction to award. Id. at 803.
The Texas Supreme Court held that, regarding Fodge's claims for "benefits due" and for damages caused by the insurer's bad faith "denial" of additional benefits never awarded, her "failure to obtain a commission ruling entitling her to those benefits was dispostive." Id.
Because the TWCC had paid Fodge all of the benefits awarded to her under the agreement, the trial court had no jurisdiction to hear her claims for additional benefits or for damages caused by a bad faith denial of additional benefits. Id. at 804.
The court explained that because "only the TWCC can determine a claimant's entitlement" to benefits, allowing courts to award damages for wrongful deprivation of benefits to which a claimant was not entitled "would circumvent the TWCC's jurisdiction." Id.
However, regarding the claims for the carrier's bad faith delay in the payment of compensation benefits ultimately stipulated to by the carrier, the court concluded that they were "ripe for adjudication and should not have been dismissed." Id. at 805.