The personal injury law firm of Glasheen, Valles & Inderman secured a major victory for a client when the Texas Supreme Court delivered its opinion in the case of Wausau Underwriters Insurance Company vs. James Wedel and Mechelle Wedel on Friday, June 8, 2018. The issue in the case was whether a clause in an insurance policy that waived the insurance carrier’s right to subrogation also meant the carrier could not seek reimbursement from our client after the carrier had paid him benefits.
The Texas Supreme Court opinion can be viewed here.
Our client, James Wedel, worked for Cactus Transport, Inc. Wedel was injured while loading materials at Western Refining Company, L.P. Western Refining required Cactus to carry worker’s compensation insurance in order to access Western’s docks. Cactus purchased a worker’s comp policy from Wausau Underwriters Insurance Company. That policy had a clause that stated in part:
We have the right to recover our payments from anyone liable for an injury covered by this policy. We will not enforce our right against the person or organization named in the Schedule [Western Refining], but this waiver applies only with respect to bodily injury arising out of the operations described in the Schedule where you are required by a written contract to obtain this waiver from us. This endorsement shall not operate directly or indirectly to benefit anyone not named in the schedule.
In exchange for waiving it’s right of recovery, Wausau also received a higher premium for the policy. After Wedel’s injury, Wausau paid him benefits under the worker’s compensation insurance policy. Separately, Wedel sued Western Refining for causing his injuries. As settlement negotiations were taking place between Wedel and Western Refining, Wausau claimed it had a subrogation interest that entitled it to be repaid for benefits previously paid to Wedel. Wedel disagreed stating that Wausau had waived it’s right to repayment.
The trial court dismissed Wausau’s claim, and the appellate court affirmed the trial court’s dismissal. Last week, the Texas Supreme agreed with the two lower courts and Wedel, holding that the clause in the worker’s compensation insurance policy did, in fact, prevent Wausau from being able to seek repayment from Wedel.