Liberty Mutual Insurance Company v. Transit Mix Concrete & Materials Company ( 2013 )

In The
Court of Appeals
Sixth Appellate District of Texas at Texarkana
No. 06-12-00117-CV
LIBERTY MUTUAL INSURANCE COMPANY, Appellant
V.
TRANSIT MIX CONCRETE & MATERIALS COMPANY, Appellee
On Appeal from the 102nd District Court
Bowie County, Texas
Trial Court No. 10C0001-102
Before Morriss, C.J., Carter and Moseley, JJ.
Memorandum Opinion by Justice Moseley
MEMORANDUM OPINION
Robert Smith, an employee of Texarkana Construction Company (Texarkana
Construction), was injured January 4, 2008, while working on a construction job at the
Texarkana Regional Airport, which is located in Arkansas, just across the Texas border. The
injury to Smith, a concrete finisher, occurred as he was holding the chute of a concrete mixer
truck owned and operated by Transit Mix Concrete and Materials Company (Transit Mix), which
was delivering concrete to the job site. Smith indicated that the driver of the truck negligently
caused his injuries when the driver failed to signal Smith before he unlocked the chute. Upon
being unlocked, the chute swung into Smith, dragging him into a nearby “concrete lay-down
machine,” causing injury to Smith’s back and left leg. At the time the injury occurred, Smith
was a Texas resident and Texarkana Construction Company was a Texas entity. Liberty Mutual
Insurance Company (Liberty Mutual), Texarkana Construction’s worker’s compensation insurer,
paid $91,155.39 in medical bills incurred by Smith as a result of the injuries he sustained.
Two lawsuits were filed against Transit Mix. One was filed January 4, 2010, by Liberty
Mutual in Bowie County, Texas. 1 Subsequent to the filing of the suit by Liberty Mutual (after
the suit might have been barred by the applicable Texas statute of limitations but before recovery
would have been barred under Arkansas law), Smith filed a lawsuit in Miller County, Arkansas,
the county of the accident site where he was injured. 2 In March 2011, Transit Mix filed a motion
1
In Texas, subrogation claims accrue “at the same time the employee’s action against the third party accrues.”
Guillot v. Hix, 838 S.W.2d 230, 235 (Tex. 1992). We do not express any opinion concerning when the subrogation
claim accrues under Arkansas law.
2
We note Smith, faced with the denial of a continuance, later filed a non-suit and then refiled the lawsuit within a
year. The parties agree that Smith has complied with Arkansas procedural law including the statute of limitations
and the permissible refiling within a year after a nonsuit.
2
in Liberty Mutual’s Texas suit seeking to have the suit dismissed pursuant to the doctrine of
forum non conveniens. After pleading responses and after a hearing, the trial court granted
Transit Mix’s motion and dismissed Liberty Mutual’s suit. It is from that order of dismissal that
Liberty Mutual has appealed.
“‘The doctrine of forum non conveniens is an equitable doctrine exercised by courts to
resist imposition of an inconvenient jurisdiction on a litigant, even if jurisdiction . . . would not
violate due process.’” Exxon Corp. v. Choo, 881 S.W.2d 301, 302 n.2 (Tex. 1994) (quoting
Sarieddine v. Moussa, 820 S.W.2d 837, 839 (Tex. App.—Dallas 1991, writ denied)).
On appeal, Liberty Mutual maintains that the dismissal of its lawsuit was error claiming
that (1) Transit Mix’s motion to dismiss was not timely, (2) Arkansas does not provide an
adequate forum to adjudicate the claims, (3) Texas has the most significant contacts with the case
and is, therefore, the proper forum, (4) Bowie County, Texas, (not Miller County, Arkansas) has
the dominant jurisdiction, and (5) Texas Civil Practice and Remedies Code Section 71.051(b)
prohibits the dismissal.
I. Do Statutory or Common Law Rules Dictate Application of Forum Non
Conveniens?
The parties disagree as to the rules which govern the disposition of the question in this
case. One side claims that statutory rules govern the forum non conveniens issue while the other
maintains that common law rules apply. 3 Section 71.051 of the Texas Practice and Remedies
Code applies to personal injury and wrongful death actions. TEX. CIV. PRAC. & REM. CODE ANN.
3
As noted by the Texas Supreme Court, Texas statutory forum non conveniens has “‘deep roots in the common
law.’” Quixtar Inc. v. Signature Mgmt. Team, LLC, 315 S.W.3d 28, 32 (Tex. 2010) (per curiam) (quoting In re
Pirelli Tire, L.L.C., 247 S.W.3d 670, 675 (Tex. 2007) (orig. proceeding) (plurality opinion)).
3
§ 71.051 (West 2008). On the one hand, Liberty Mutual argues that this claim should be
governed by Section 71.051 because the underlying claim is a personal injury claim; on the other
hand, Transit Mix argues that since the personal injury claim has been filed in Arkansas, this
lawsuit does not concern a personal injury and the common law should apply.
Transit Mix concedes that Liberty Mutual’s claim is a derivative claim. “There is but one
cause of action for an employee’s injuries . . . .” Franks v. Sematech, Inc., 936 S.W.2d 959, 960
(Tex. 1997) (per curiam) (concluding employee could intervene even after limitations had run).
Although the insurance carrier can assert its subrogation claim independently of the employee,
its claim is still derivative of the employee’s claim. Id. Thus, in this case, there is only one
cause of action: Smith’s personal injury cause of action. Although Liberty Mutual’s subrogation
claim can be brought independently, its claim would not exist apart from the injury and its ability
to recover is derivative of the personal injury cause of action.
Because Liberty Mutual’s subrogation claim is derivative of Smith’s personal injury
cause of action, this lawsuit is a personal injury lawsuit and is subject to the rules promulgated
by statute, 4 not by common law rules.
II. Findings of Fact Are Implied
We note that although Section 71.051 requires the trial court to issue findings of fact and
conclusions of law, see TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(f), the record provided to
us contains no such findings and conclusions. It also appears that neither a request for findings
4
TEX. CIV. PRAC. & REM. CODE ANN. § 71.051.
4
of fact nor a request for past-due findings of fact was filed. 5 Therefore, any error regarding the
trial court’s failure to file findings of fact has been waived. See Curtis v. Comm’n for Lawyer
Discipline, 20 S.W.3d 227, 232 (Tex. App.—Houston [14th Dist.] 2000, no pet.); Betts v. Reed,
165 S.W.3d 862, 867 (Tex. App.—Texarkana 2005, no pet.). In the absence of findings of fact
and conclusions of law, we imply that the trial court found all facts necessary to support its
decision so long as they are also supported by the evidence. BMC Software Belg., N.V. v.
Marchand, 83 S.W.3d 789, 795 (Tex. 2002); see Betts, 165 S.W.3d at 867. Even so, the validity
of implied findings may still be challenged on appeal for want of legal and factual sufficiency
when the appellate record includes the reporter’s and clerk’s records. BMC Software, 83 S.W.3d
at 795; Betts, 165 S.W.3d a 867.
III. The Timeliness of Transit Mix’s Motion to Dismiss Was Not Preserved for Review
Liberty Mutual complains, in its first issue, that Transit Mix failed to file its motion to
dismiss based on forum non conveniens in a timely manner, claiming that Texas Civil Practice
and Remedies Code Section 71.051(d) and Rule 86 of the Texas Rules of Civil Procedure
mandate that Transit Mix’s motion be filed within 180 days of Transit Mix’s answer. Transit
Mix responds that any such error has not been preserved for appellate review. 6 Because Liberty
Mutual failed to raise this issue at the trial level, we determine that it failed to preserve this error
for our review.
5
To the extent the trial court’s order can be construed as containing findings of fact and conclusions of law, we
cannot consider them. Findings of fact rendered in the body of a judgment cannot be considered on appeal. See
TEX. R. CIV. P. 299a (“Findings of fact shall not be recited in a judgment.”); Sherer v. Sherer, 393 S.W.3d 480, 484
n.7 (Tex. App.—Texarkana 2013, pet. denied).
6
Transit Mix argues further that because the motion was brought under the common law, the motion is timely. As
discussed above, the motion was governed by statutory law.
5
In its reply brief, Liberty Mutual argues that its failure to perfect error is not fatal to its
complaint because the error is “systemic.” It goes on to urge our adoption of the three categories
of error preservation adopted by the Texas Court of Criminal Appeals in Marin v. State, 851
S.W.2d 275, 279 (Tex. Crim. App. 1993), modified on other grounds by Cain v. State, 947
S.W.2d 262, 264 (Tex. Crim. App. 1997) (Except for structural errors, “no error . . . is
categorically immune to a harmless error analysis.”). Liberty Mutual espouses the proposition
that this Court applied criminal error preservation standards to a civil case in Suggs v. Fitch, 64
S.W.3d 658 (Tex. App.—Texarkana 2001, no pet.), wherein this Court held that the failure to
request the jury to be polled waived the error. Liberty Mutual, based on its interpretation of
Suggs, argues that timeliness is a waivable-only right because it is a mandatory statutory
requirement. 7
We disagree that Suggs purports to adopt standards set out by the Texas Court of
Criminal Appeals for criminal cases. Suggs relies entirely on civil cases and applies civil
standards, the only support to Liberty Mutual’s argument being that this Court in Suggs used the
word “waiver.” Courts, when discussing error preservation, sometimes employ the word
“waiver” as a synonym for both “forfeit” and the phrase “failure to preserve error.” Whereas
Marin assigned specific and distinct meanings to waiver and forfeit, courts still occasionally use
the words synonymously—particularly in the context of civil cases where the Marin categories
7
We note that many mandatory statutory requirements can be forfeited under the Marin error preservation rules. See
Marin, 851 S.W.2d at 279 (“All but the most fundamental rights are thought to be forfeited if not insisted upon by
the party to whom they belong” including “[m]any constitutional rights.”). In the criminal context, absolute or
“systemic” rights are generally limited to such issues as legal sufficiency, jurisdictional errors, and separation of
powers issues. See Saldano v. State, 70 S.W.3d 873, 888 (Tex. Crim. App. 2002); see also Moff v. State, 131
S.W.3d 485, 489 (Tex. Crim. App. 2004).
6
are inapplicable. In Suggs (as well as the cases cited as authority in it), the Court merely uses
“waiver” as a synonym for “forfeit.” See id. at 660. We decline to extend the Marin categories
of error preservation to civil cases not involving juvenile delinquency determinations. 8
Liberty Mutual alternatively argues that the error is fundamental. We note that Texas
jurisprudence significantly limits the fundamental error doctrine. Rittenhouse v. Sabine Valley
Ctr. Found., Inc., 161 S.W.3d 157, 166 (Tex. App.—Texarkana 2005, no pet.). “Fundamental
error survives today in those rare instances in which the record shows the court lacked
jurisdiction or that the public interest is directly and adversely affected as that interest is declared
in the statutes or the Constitution of Texas.” Pirtle v. Gregory, 629 S.W.2d 919, 920 (Tex. 1982)
(per curiam); see Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 577 (Tex. 2006). Liberty
Mutual’s complaints regarding this issue fail to affect a public interest so significant that
fundamental error review has been recognized. See Ramsey v. Dunlop, 205 S.W.2d 979, 984
(Tex. 1947) (recognizing election contest as example of error directly and adversely affecting
interest of public generally). “Defects in procedure will rarely constitute fundamental error . . .
.” Estate of Pollack v. McMurrey, 858 S.W.2d 388, 395 (Tex. 1993) (Gonzalez, J., concurring).
Because the face of the record reflects neither a lack of jurisdiction nor a direct and adverse
effect on a significant public interest, we reject Liberty Mutual’s argument that the error was
fundamental.
8
We note that the Texas Supreme Court has utilized the Marin error preservation categories in juvenile delinquency
cases characterized as quasi-criminal. See In re C.O.S., 988 S.W.2d 760, 765 (Tex. 1999).
7
Liberty Mutual failed to preserve error, if any, for appellate review concerning whether
the motion for forum non conveniens was timely filed. See TEX. R. APP. P. 33.1. We overrule
Liberty Mutual’s first issue.
IV. Arkansas Has the Most Significant Relationship
In its third issue, Liberty Mutual argues that Texas Law should apply because at the time
that Smith suffered the injury giving rise to these claims, all of the interested parties were Texas
residents. Transit Mix, consistent with its trial argument, insists that a forum non conveniens
argument does not require a decision regarding which State’s law applies to this case, but it
argues alternatively that Arkansas has a greater interest than Texas. Transit Mix emphasizes that
the injury occurred in Arkansas and that Smith is now an Arkansas resident having moved from
Texas since the incident occurred. Neither party argues that Texas law should apply to only part
of the lawsuit while Arkansas law applies to the rest of the lawsuit. Therefore, we will limit our
analysis to whether Texas law should govern the entire case.
We disagree with Transit Mix that this issue is a non sequitor that does not require
resolution in a forum non conveniens analysis. The Texas Supreme Court has recognized a
relationship between choice of law, on the one hand, and forum non conveniens, on the other.
See Coca-Cola Co. v. Harmar Bottling Co., 218 S.W.3d 671, 680–82 (Tex. 2006) (“On occasion,
comity and choice of law may suggest that a Texas court should dismiss a claim in favor of a
foreign forum under principles of forum non conveniens.”). Further, the fifth statutory factor of
Section 71.051 requires consideration of whether the forum is at home with the law that governs
the case and, therefore, whether a choice of law analysis is necessary. See Schippers v. Mazak
8
Props., Inc., 350 S.W.3d 294, 300 (Tex. App.—San Antonio 2011, pet. denied); see also TEX.
CIV. PRAC. & REM. CODE ANN. § 71.051(b)(5).
Unless the contacts raise disputed issues of fact, a choice of law analysis is a question of
law to be reviewed de novo. Sonat Exploration Co. v. Cudd Pressure Control, Inc., 271 S.W.3d
228, 231 (Tex. 2008); see Minnesota Mining & Mfg. Co. v. Nishika Ltd., 955 S.W.2d 853, 856
(Tex. 1996) (per curiam) (question of law to be reviewed de novo); Vanderbilt Mortg. & Fin.,
Inc. v. Posey, 146 S.W.3d 302, 313 (Tex. App.—Texarkana 2004, no pet.). Giving deference to
any implied findings of fact, we review this issue de novo.
Despite the fact that the injuries were sustained in another state, a personal injury lawsuit
can be tried in Texas. The Texas Civil Practice and Remedies Code specifically permits such a
lawsuit if the law of Texas or the foreign state provide a cause of action, the action is begun
within the time provided by Texas law, and the action is begun within the time provided by the
laws of the foreign state. TEX. CIV. PRAC. & REM. CODE ANN. § 71.031 (West 2008); Owens
Corning v. Carter, 997 S.W.2d 560, 573 (Tex. 1999) (Section 71.031 is “essentially a codified
choice-of-law rule governing the timeliness of actions.”). In deciding which state’s law should
apply, we apply Texas’ choice of law rules. See TEX. CIV. PRAC. & REM. CODE ANN.
§ 71.031(b).
Historically, a jurisdiction’s body of laws was thought to have no effect outside its own
territory, but courts would recognize foreign law, either under the doctrine of comity or through
a theory of “vested rights.” See Slater v. Mexican Nat’l R.R. Co., 194 U.S. 120, 126 (1904); Cal.
v. Copus, 309 S.W.2d 227, 229–33 (Tex. 1958). Texas courts have abandoned the lex loci
9
delecti (application of the law prevailing where the injury occurred) approach in favor of the less
restrictive approach combining the methodologies of a governmental policy analysis and the
“most significant relationship” approach embodied in the Second Restatement of Conflict of
Laws. See Gutierrez v. Collins, 583 S.W.2d 312, 314 (Tex. 1979); RESTATEMENT (SECOND) OF
CONFLICT OF LAWS § 6 (1971); see also Torrington Co. v. Stutzman, 46 S.W.3d 829, 848 (Tex.
2000).
A preliminary step in deciding choice of law is to determine whether the laws of the
various jurisdictions conflict. Posey, 146 S.W.3d at 313; see Sonat Exploration Co. v. Cudd
Pressure Control, Inc., 202 S.W.3d 901, 905 (Tex. App.—Texarkana 2006), aff’d by, 271
S.W.3d 228, 231 (Tex. 2008). Liberty Mutual and Transit Mix agree that there is a difference in
the laws of the two states because Arkansas courts apply the “made whole” doctrine to all
subrogation claims 9 while Texas worker’s compensation claims are governed by statutes which
provide that the insurance carrier’s subrogation interest will be paid first and the injured worker
receives the remainder. See TEX. LAB. CODE ANN. § 417.001(b) (West 2006). We agree with
the parties that the laws of Texas and Arkansas differ to the effect that the outcome to the parties
could be substantially different from one state to the other.
9
The parties agree that Arkansas applies the “made whole” doctrine to subrogation claims. See Riley v. State Farm
Mut. Auto. Ins. Co., 2011 Ark. 256 at 12, 381 S.W.3d 840, 848 (“Absent an agreement or settlement between the
parties, an insurer’s right to subrogation does not accrue until there has been a legal determination by a court that the
insured has been made whole.”); Franklin v. Healthsource of Ark., 328 Ark. 163, 169, 942 S.W.2d 837, 840 (1997)
(“no distinction need be made between equitable and conventional rights of subrogation”); Shelter Mut. Ins. Co. v.
Bough, 310 Ark. 21, 28, 834 S.W.2d 637, 641 (1992) (“[W]hile the general rule is that an insurer is not entitled to
subrogation unless the insured has been made whole for his loss, the insurer should not be precluded from
employing its right of subrogation when the insured has been fully compensated and is in a position where the
insured will recover twice for some of his or her damages.”).
10
Next, we should determine whether the “most significant relationship” lies with Texas or
with Arkansas. For personal injury lawsuits, the “most significant relationship” test involves
three levels. The first level, as stated in Section 6 of the Restatement of Conflict of Laws,
involves the general test: the weighing of the competing policy interests of the different
jurisdictions. Posey, 146 S.W.3d at 314. Section 6 requires consideration of
(a) the needs of the interstate and international systems,
(b) the relevant policies of the forum,
(c) the relevant policies of other interested states and the relative interests of
those states in the determination of the particular issue,
(d) the protection of justified expectations,
(e) the basic policies underlying the particular field of law,
(f) certainty, predictability and uniformity of result, and
(g) ease in the determination and application of the law to be applied.
RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 6) (1971); see Gutierrez, 583 S.W.2d at 319
(adopting RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 6).
The second level of analysis 10 provides additional guidance concerning a specific area of
law. Posey, 146 S.W.3d at 314. The case before us would involve the law of torts. While
Section 6 “sets out the general principles by which the more specific rules are to be applied,”
Section 145 provides a more specific rule applicable to a tort case. Gutierrez, 583 S.W.2d at
318–19. Section 145 emphasizes the following four factors:
(a) the place where the injury occurred,
(b) the place where the conduct causing the injury occurred,
(c) the domicil[e], residence, nationality, place of incorporation and place of
business of the parties, and
10
Although Liberty Mutual is a worker’s compensation carrier, Liberty Mutual has not argued employer immunity is
an issue. See Hughes Wood Prods., Inc. v. Wagner, 18 S.W.3d 202, 206 (Tex. 2000) (considering Section 184 of the
Second Restatement of Conflict of Laws when employer immunity was an issue). Although Liberty Mutual cites
Hughes, it only cites Hughes for the Section 6 general factors and does not discuss the worker’s compensation
section of the Hughes opinion.
11
(d) the place where the relationship, if any, between the par[ties] is centered.
Id. at 319 (quoting RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 145).
Another level of analysis provides guiding principles for a specific context within the
area of law. For personal injury lawsuits, this level is governed by Section 146 of the
Restatement. See Enter. Prods. Partners, L.P. v. Mitchell, 340 S.W.3d 476, 480 (Tex. App.—
Houston [1st Dist.] 2011, pet. abated); Ford Motor Co. v. Aguiniga, 9 S.W.3d 252, 260 (Tex.
App.—San Antonio 1999, pet. denied). Section 146 provides:
In an action for a personal injury, the local law of the state where the injury
occurred determines the rights and liabilities of the parties, unless, with respect to
the particular issue, some other state has a more significant relationship under the
principles stated in § 6 to the occurrence and the parties, in which event the local
law of the other state will be applied.
RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 146.
While Liberty Mutual stresses that the place the injury occurred is the sole contact with
Arkansas, Transit Mix contravenes that by urging us to consider the fact that Smith, the injured
party, now resides in Arkansas. We disagree with Transmit Mix on this point. “[I]t is the
plaintiff’s residence at the time of the injury, not the time of filing, that is relevant.” Tullis v.
Georgia-Pacific Corp., 45 S.W.3d 118, 127 (Tex. App.—Fort Worth 2000, no pet.). At the time
of the injury, Smith was a Texas resident and Texarkana Construction was a Texas corporation.
Transit Mix had a place of business in Texas. Finally, as noted by Liberty Mutual, the injury
occurred while Smith was working for a Texas company and Smith obtained benefits under a
Texas worker’s compensation policy which was administered in Texas. 11 We agree with Liberty
11
We do note that Smith received medical treatment in both Texas and Arkansas.
12
Mutual that the conduct causing the injury and the injury itself were the sole contacts with
Arkansas.
In Gutierrez, the Texas Supreme Court observed that when two residents of Texas are
involved in an accident in another state, the law of Texas may apply. Gutierrez, 583 S.W.2d at
319 (remanding personal injury suit for accident in Mexico between two Texas residents for
consideration of the most significant relationship test); see also Robertson v. Estate of McKnight,
609 S.W.2d 534, 537 (Tex. 1980) (concluding New Mexico law should apply although accident
occurred in Texas). More recently, the Texas Supreme Court has noted that Texas has an interest
in protecting resident defendants from “undue liability and excessive litigation.” Torrington Co.,
46 S.W.3d at 849–50 (Texas law should apply to military helicopter crash).
Nevertheless, the Texas Supreme Court has observed that “the number of contacts with a
particular state is not determinative.” Duncan v. Cessna Aircraft Co., 665 S.W.2d 414, 421
(Tex. 1984). The analysis of the contacts should be qualitative rather than quantitative. Minn.
Mining & Mfg. Co., 955 S.W.2d at 856; see Duncan, 665 S.W.2d at 421; Posey, 146 S.W.3d at
316. As noted by the Texas Supreme Court in Gutierrez, the application of Texas law whenever
Texas residents are involved is not a foregone conclusion. Gutierrez, 583 S.W.2d at 319.
While the only two contacts with Arkansas are the place of the injury and the conduct
causing the injury, Section 146 demonstrates that these are quite important factors. The Texas
Supreme Court recognized in Gutierrez that the presumption of Section 146 can be overcome
when both parties are Texas residents, but the Supreme Court prescribed no bright-line rule to
follow.
13
Although Liberty Mutual argues that everyone involved in the controversy was a Texas
resident at the time of the injury, the record does not entirely support this claim. The record
supports that at that time, Smith was a Texas resident and Texarkana Construction was a Texas
corporation with a primary place of business in Texas. In contrast, although both are authorized
to conduct business in the State of Texas, Liberty Mutual and Transit Mix 12 are both Delaware
corporations. While Texas has an interest in protecting foreign corporations with places of
business in Texas, such an interest may not be as intense as the desire to provide protection to
native Texas corporations as expressed in Torrington, 46 S.W.3d at 850. The fact that Liberty
Mutual and Transit Mix are Delaware corporations decreases Texas’ interest to some small
degree.
Unlike the automobile accident in Gutierrez, 583 S.W.2d at 319, the airplane crash in
Robertson, 609 S.W.2d at 537, or the helicopter crash in Torrington, 46 S.W.3d at 850, the
injury-causing accident in this case occurred during construction work on a public facility. A
state’s interest in car and airplane accidents which do not involve any of that state’s citizens will
be fleeting and fortuitous at best and are somewhat transient in nature. A state’s interest in an
accident at a permanently based public facility that will service thousands of that state’s citizens
may be more profound and permanent. Because this accident occurred during construction on
the Texarkana Regional Airport on the Arkansas side of the State border, Arkansas will likely
have a greater interest in its disposition than it would in a car accident or aircraft crash.
12
At the hearing, the parties argued Transit Mix was “situated in Dallas,” was “[a] Texas defendant,” and “is a Texas
corporation.” The pleadings, though, establish that both Liberty Mutual and Transit Mix are Delaware corporations
authorized to conduct business in Texas.
14
While Arkansas public policy in this area differs from Texas public policy, we note that
the difference is not severe. Texas recognizes three varieties of subrogation: equitable,
contractual, and statutory. Fortis Benefits v. Cantu, 234 S.W.3d 642, 648 (Tex. 2007). Texas
applies the “made whole” rule to equitable subrogation. Id. at 650 (the terms of the contract
govern contractual subrogation). The Texas Legislature recently enacted a law which governs
the apportionment of recovery between the injured party and the insurance subrogee when the
recovery is insufficient to make the injured party whole. See Act of May 17, 2013, 83d Leg.,
R.S., H.B. 1869, § 1 (to be codified at TEX. CIV. PRAC. & REM. CODE ANN. § 140). While we
note that this bill exempts worker’s compensation claims, under certain circumstances, this bill
will bring Texas’ subrogation recoveries closer to the “made whole” doctrine. Because the
differences between each state’s public policy are not profound, the Texas interest in protecting
Texas companies from undue liability is not terribly compelling.
Additionally, Section 6 recognizes the protection of justified expectations as a factor to
be considered. Texarkana is a community which lies astride the Texas/Arkansas border; in such
a community, there is a reasonable expectation that most companies will conduct business in
both states. 13 Thus, any reasonable insurance carrier could foresee the possibility that its client
would conduct business in multiple states and adjust rates or terms accordingly. Due to the
nature of a border community such as Texarkana, we do not believe that this case presents a
circumstance where the application of Arkansas law will expose a Texas resident to undue
liability. Because this liability would be a reasonable expectation, it is not an undue liability.
13
We take further judicial notice of Texarkana’s close proximity to the Oklahoma and Louisiana borders.
15
As recognized by Section 146 of the Second Restatement of Conflict of Laws, Arkansas
(as the place of the injury and where it is alleged that tortious conduct giving rise to the injury
occurred) has a significant interest. This interest is sufficient to counteract the Texas interest in
protecting one Texas corporation and two foreign corporations conducting business in a Texas
border community. We conclude that Arkansas law should apply.
V. No Abuse of Discretion in Dismissal
In its second issue, Liberty Mutual argues that the trial court erred in granting the forum
non conveniens motion because Arkansas is not an adequate forum. Since 1993, personal injury
lawsuits have been governed by a forum non conveniens statute that requires a trial court to
consider the following six factors:
(1) an alternate forum exists in which the claim or action may be tried;
(2) the alternate forum provides an adequate remedy;
(3) maintenance of the claim or action in the courts of this state would
work a substantial injustice to the moving party;
(4) the alternate forum, as a result of the submission of the parties or
otherwise, can exercise jurisdiction over all the defendants properly joined to the
plaintiff’s claim;
(5) the balance of the private interests of the parties and the public
interest of the state predominate in favor of the claim or action being brought in
an alternate forum, which shall include consideration of the extent to which an
injury or death resulted from acts or omissions that occurred in this state; and
(6) the stay or dismissal would not result in unreasonable duplication
or proliferation of litigation.
TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(b). “The statute does not mandate that a movant
prove each factor or that each factor must weigh in favor of dismissal to require a motion to be
granted.” In re Gen. Elec. Co., 271 S.W.3d 681, 687 (Tex. 2008).
16
We note there is a substantial overlap between statutory forum non conveniens caselaw
and common law forum non conveniens caselaw, despite the fact that the statute has “‘deep roots
in the common law.’” Quixtar, 315 S.W.3d at 32 (quoting Pirelli Tire, 247 S.W.3d at 675).
Further, Texas Courts “regularly consider United States Supreme Court precedent in both our
common law and statutory forum non conveniens cases.” Id.
The Texas Supreme Court has “decline[d] to establish a formulaic application for a trial
court’s forum non conveniens determination.” Id. at 35. A trial court’s decision about whether
to dismiss a case on forum non conveniens grounds is reviewed for an abuse of discretion. Gen.
Elec., 271 S.W.3d at 685. A trial court “abuses its discretion if its decision is arbitrary,
unreasonable, or without reference to guiding principles.” Id.
Both Transit Mix and Liberty Mutual erroneously argue that Transit Mix had the burden
of proof on a forum non conveniens. As noted below, Transit Mix argues this burden shifted to
Liberty Mutual concerning whether Arkansas was an adequate forum. All of the cases cited are
common law forum non conveniens cases and are, therefore, clearly distinguishable. 14 The
Texas Supreme Court has held that, unlike the version of the statute in effect prior to 2003, the
current version of the forum non conveniens statute “does not contain language placing the
burden of proof on a particular party in regard to the factors.” Id. at 687; see In re Ensco
Offshore Int’l Co., 311 S.W.3d 921, 927 (Tex. 2010) (per curiam). The court explained:
[t]he statute simply requires the trial court to consider the factors, and it must do
so to the extent the factors apply. To the extent evidence is necessary to support
14
Transit Mix cites Quixtar, 315 S.W.3d at 31 (noting general common law rule is movant has a “heavy burden” but
that a nonresident plaintiff’s choice of forum deserves less deference). Liberty Mutual cites Sinochem International
Co. v. Malaysia International Shipping Corp., 549 U.S. 422, 430 (2007), and Moussa, 820 S.W.2d at 841.
17
the positions of the parties, the trial court must base its findings and decision on
the weight of the evidence, and certainly is entitled to take into account the
presence or absence of evidence as to some issue or position of a party.
Gen. Elec., 271 S.W.3d at 687. We conclude that neither party had the burden of proof.
We note that at the hearing, the trial court’s stated reason for granting the motion was that
Smith “chose Arkansas for whatever reason.” Even so, the discussion at the hearing, while not
specifically referencing the factors, included issues pertinent to most of the factors. Although a
trial court has no discretion in determining what the law is or applying the law to the undisputed
or conclusively established facts, 15 a trial court does not abuse its discretion, even when the
court’s stated reason for the decision is wrong, if the result is correct under any theory of law. 16
We further note that in its written order, the trial court referenced balancing the parties’ private
interests and the state’s public interests.
Although Liberty Mutual only explicitly challenges the Second and Fifth factors, there is
no requirement that every factor weigh in favor of dismissal. Since all factors must be
considered by the trial court, we will consider all of the factors in determining whether the trial
court abused its discretion.
15
See In re Dillard Dep’t Stores, Inc., 198 S.W.3d 778, 781 (Tex. 2006) (orig. proceeding) (per curiam); Griffin v.
Birkman, 266 S.W.3d 189, 196 (Tex. App.—Austin 2008, pet. denied); Landon v. Jean-Paul Budinger, Inc., 724
S.W.2d 931, 935 (Tex. App.—Austin 1987, no writ).
16
Columbia Med. Ctr. Subsidiary, L.P. v. Meier, 198 S.W.3d 408, 411 (Tex. App.—Dallas 2006, pet. denied);
Landon, 724 S.W.2d at 935.
18
VI. Statutory Forum Non Conveniens
A. Factors 1 and 2:
The first two statutory factors concern whether Arkansas is an adequate forum. Gen.
Elec., 271 S.W.3d at 687. Liberty Mutual does not contest that this action can be tried in
Arkansas. “An alternate forum is one where the defendant is amenable to process.” Ensco
Offshore Int’l Co., 311 S.W.3d at 924. It is uncontested that Transit Mix is amenable to process
in Arkansas and has appeared in Smith’s lawsuit pending in Arkansas.
Transit Mix argues that Liberty Mutual had the burden to establish that Arkansas was not
an adequate forum. 17 We have not been directed to any authority, nor are we aware of any,
holding that the non-movant has the burden to prove the alternative forum is inadequate. As
discussed above, the Texas Supreme Court has held that neither party bears the burden in
statutory forum non conveniens cases. See Gen. Elec., 281 S.W.3d at 687.
A forum is not inadequate merely because the law is less favorable to one party or the
other. Piper Aircraft Co. v. Reyno, 454 U.S. 235, 254 n.22 (1981). Because of the complexity of
a “comparative analysis of the procedures, rights, and remedies” available in two forums, the
Texas Supreme Court has held such an analysis should only be given weight when the alternative
17
Transit Mix cites Direct Color Services, Inc. v. Eastman Kodak Co., 929 S.W.2d 558, 564 (Tex. App.—Tyler
1996, writ denied), superseded by statute as stated in Adams v. Baxter Healthcare Corp., 998 S.W.2d 349, 356 (Tex.
App.—Austin 1999, no pet.) (noting Direct Color Services predates the 1993 adoption of Section 71.051),
Vaz Borralho v. Keydril Co., 696 F.2d 379, 391 (5th Cir. 1983), overruled on other grounds by In re Air Crash
Disaster near New Orleans, 821 F.2d 1147, 1163 n.25 (5th Cir. 1987), and Yoroshii Investments (Mauritius) PTE.
Ltd. v. BP International Ltd., 179 S.W.3d 639, 643 (Tex. App.—El Paso 2005, pet. denied) (citing Sarieddine, 820
S.W.2d at 841). Regardless of the extent these cases support Transit Mix’s position, all of these cases are common
law forum non conveniens rather than statutory forum non conveniens. Because the Texas Supreme Court has
explicitly held neither party has a burden of proof in statutory forum non conveniens cases, we decline to adopt any
common law standard imposing a burden on Liberty Mutual.
19
forum “would in substance provide no remedy at all.” Gen. Elec., 271 S.W.3d at 688; see Ensco
Offshore Int’l Co., 311 S.W.3d at 924.
According to Liberty Mutual, Arkansas is not an adequate forum because it applies the
“made whole” rule to contractual subrogation. Liberty Mutual argues, citing Section 417.001(b)
of the Texas Labor Code, that the first-money reimbursement scheme is crucial to the Texas
worker’s compensation system because it reduces costs for carriers. Going further, Liberty
Mutual asserts that the Arkansas “made whole” doctrine prevents it from having any remedy in
Arkansas courts. Liberty Mutual believes that Arkansas law would permit Smith to settle for an
amount less than his actual damages and thereby avoid having to reimburse Liberty Mutual for
his medical bills. 18 Because Arkansas provides some remedy, it is not necessary for us to
conduct a comprehensive analysis.
While Arkansas law may be less favorable to Liberty Mutual than Texas law, Arkansas
law does provide a remedy. If the recovery is sufficient to make Smith whole, Liberty Mutual
can recover under Arkansas law. The mere fact that the alternative forum would provide a lesser
recovery does not prevent the alternative forum from providing an adequate remedy. See Berg v.
AMF Inc., 29 S.W.3d 212, 217 (Tex. App.—Houston [14th Dist.] 2000, no pet.) (factor not given
substantial weight when foreign law provides “some recovery”). We conclude that Arkansas is
an adequate forum.
18
Transit Mix argues Liberty Mutual has greatly exaggerated the differences between Texas and Arkansas
subrogation law. We do not express any opinion concerning whether Liberty Mutual’s interpretation is a correct
interpretation of Arkansas law.
20
B. Factor 3: Trial in Arkansas Causes No Substantial Injustice to Liberty
Mutual
Liberty Mutual does not contest this factor. In deciding this factor, the Texas Supreme
Court has considered increased travel time, the availability of witnesses, and whether there is
compulsory process to secure the attendance of witnesses. See Ensco Offshore Int’l Co., 311
S.W.3d at 925; Gen. Elec., 271 S.W.3d at 689. Unlike Ensco Offshore International, 311
S.W.3d at 926 (considering travel time between Australia, Singapore, and Dallas), this is not a
case that would force Liberty Mutual to travel a significant distance to litigate in the alternative
forum. We take judicial notice that Bowie County, Texas, and Miller County, Arkansas, are
adjacent counties. 19 Liberty Mutual concedes the costs of litigating in Miller County, Arkansas,
will not significantly differ from the cost of litigating only a few miles away in Bowie County,
Texas. It is uncontested that witnesses will be available in Arkansas and a compulsory process
can secure their attendance.
C. Factor 4: Arkansas Can Exercise Jurisdiction Over All the Defendants
It is uncontested that Arkansas can exercise jurisdiction over all the defendants. Transit
Mix has appeared in the Arkansas suit and at least some discovery has been conducted in that
suit.
19
We also take judicial notice that the City of Texarkana is located in both Bowie County, Texas, and Miller County,
Arkansas.
21
D. Factor 5: Arkansas’ Interests Predominate
Liberty Mutual claims that Texas has a greater public interest in this litigation than
Arkansas. In deciding which State’s interests predominate, the Texas Supreme Court has adopted
the common law Gulf Oil 20 factors:
Generally, the public interest factors to be considered are administrative
difficulties related to court congestion, burdening the people of a community with
jury duty when they have no relation to the litigation, local interest in having
localized controversies decided at home, and trying a case in the forum that is at
home with the law that governs the case. See Gulf Oil, 330 U.S. at 508–09. The
private interest considerations generally are considered to be the ease of access to
proof, the availability and cost of compulsory process, the possibility of viewing
the premises, if appropriate, and other practical problems that make trial easy,
expeditious, and inexpensive. Id. at 508; see Pirelli, 247 S.W.3d at 676.
Gen. Elec., 271 S.W.3d at 691 (statutory forum non conveniens); see Quixtar, 315 S.W.3d at 32
(applying Gulf Oil factors to common law forum non conveniens).
The first three public interest factors weigh neither for nor against dismissal. The record
contains no evidence or arguments concerning court congestion or burdening the people of a
community with jury duty when they have no relation to the litigation. As judicially noted
above, Bowie County and Miller County are adjacent counties. The largest city in both counties
is Texarkana, which (though having separate municipal governments) is a single city straddling
the border between the two States. Since both forums are essentially part of the same
community, the local interest factor weighs neither for nor against dismissal.
Liberty Mutual argues that this lawsuit should be litigated in Texas courts because Texas
law should apply. As discussed above, we have determined Arkansas law should apply to this
20
Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508 (1947).
22
case. Therefore, the factor that the court trying a case is at home with the law that governs the
case favors dismissal.
The private interest considerations weigh slightly in favor of dismissal. Liberty Mutual
concedes that the Bowie County and Miller County Courthouses are located only a few miles
apart 21 and that the costs of litigation will be identical. Liberty Mutual does argue that
enforcement of the judgment will be easier in Texas because Transit Mix is a Texas corporation.
At trial, Transit Mix argued that the enforcement in “Arkansas is as good as in Texas.” The
record is devoid of any evidence supporting either claim. As noted above, neither party has the
burden in a statutory forum non conveniens motion.
The trial court did not abuse its discretion in concluding Arkansas’ interests predominate.
E. Factor 6: The Dismissal Would Prevent Duplication of Litigation
Transit Mix emphasizes in its brief that, unless the motion is granted, it will be required
to defend two lawsuits concerning the same subject matter. Liberty Mutual argues that
subrogation claims, while derivative, can be asserted independently, see Franks v. Sematech,
Inc., 936 S.W.2d 959, 960 (Tex. 1997) (per curiam), and that it has a right to bring its
subrogation claim independently in Texas.
Liberty Mutual cites In re CVA General Contractors., Inc., 267 B.R. 773, 782 (Bankr.
W.D. Tex. 2001), for the proposition that “the subrogee assumes the status as the real party in
interest while the subrogor’s interest becomes nominal.” In that case, the court was not deciding
21
We take judicial notice that the Bowie County District Court handles some nonjury matters in the Bi-State Justice
Building located approximately four blocks from the Miller County Courthouse. In fact, the Bi-State Justice
Building, the building in which this Court sits, is located partially in Bowie County, Texas, and partially in Miller
County, Arkansas.
23
a dispute concerning whether the subrogee or the subrogor could control the course of the
litigation. Rather, the court was merely holding that the subrogee could proceed despite the
subrogor no longer existing, having been dissolved by virtue of the Chapter 7 bankruptcy
proceeding. Id. Such a situation is clearly distinguishable from a disagreement between the
subrogee and subrogor concerning the course of litigation.
The Texas Supreme Court has held that “[t]here is but one cause of action for an
employee’s injuries, and it belongs to the employee.” Franks, 936 S.W.2d at 960 (concluding
employee could intervene even after limitations had run). Liberty Mutual has provided us with
no authority that the injured worker is required to respect the worker’s compensation carrier’s
choice of forum. It is not necessary for us to determine the extent to which an injured employee
can disregard the wishes of the worker’s compensation carrier. We reject Liberty Mutual’s
argument that an injured employee must file his or her lawsuit in the forum desired by the
worker’s compensation carrier.
The Texas Supreme Court has recognized that the ability to resolve all claims in one trial
favors the granting of a forum non conveniens motion. See Ensco Offshore Int’l Co., 311
S.W.3d at 925. The trial court emphasized duplication of litigation at the hearing, and we concur
with the opinion of the trial court that this factor is significant. Transit Mix should not be forced
to undergo two discovery processes and two trials or be exposed to potentially inconsistent
verdicts in two different states. The last factor favors a dismissal.
The doctrine of forum non conveniens is intended to prevent the imposition of an
inconvenient jurisdiction on a litigant when the public and private interests at issue warrant a
24
different forum. See Yoroshii Invs. (Mauritius) PTE. Ltd., 179 S.W.3d at 643. All of the factors
which are considered are deemed to be either neutral or weigh in favor of a dismissal. As argued
by Transit Mix, this balancing is not formalistic, and we must grant deference to the trial court.
The accident occurred in Arkansas, Arkansas is an adequate forum, and Arkansas can assert
jurisdiction over the entire suit. In Arkansas, there can be one fact-finder, one verdict, and one
judgment. The balancing of the public and private interests favors dismissal. Most importantly,
we are not reviewing this decision de novo—our standard of review is for an abuse of discretion.
We conclude the trial court did not abuse its discretion in dismissing the lawsuit.
VI. Whether the Doctrine of Dominant Jurisdiction Is Applicable Has Not Been
Preserved for Appellate Review
In its fourth issue, Liberty Mutual argues that the trial court erred because Bowie County
acquired dominant jurisdiction. Although the doctrine of dominant jurisdiction 22 applies when
two courts have concurrent jurisdiction, several Texas courts have noted that the doctrine is
confined to two courts with concurrent jurisdiction located within the same state. See Ashton
Grove L.C. v. Jackson Walker L.L.P., 366 S.W.3d 790, 794 (Tex. App.—Dallas 2012, no pet.);
Griffith v. Griffith, 341 S.W.3d 43, 54 (Tex. App.—San Antonio 2011, no pet.); Ex parte Jabara,
556 S.W.2d 592, 596 (Tex. Civ. App.—Dallas 1977, no pet.) (“We conclude that the doctrine of
22
“Dominant jurisdiction is a common law concept which is not based upon lack of jurisdiction, but on the grounds
of comity, vexatious litigation, or the avoidance of a multiplicity of suits.” Ault v. Mulanax, 724 S.W.2d 824, 828
(Tex. App.—Texarkana 1986, orig. proceeding); see In re Puig, 351 S.W.3d 301, 305 (Tex. 2011) (orig. proceeding)
(per curiam) (noting Texas Supreme Court never held dominant jurisdiction results in exclusive jurisdiction). Under
the common law doctrine of dominant jurisdiction, the court that first exercises jurisdiction, normally the court in
which suit is first filed, acquires dominant jurisdiction to the exclusion of all other courts with concurrent
jurisdiction over the subject matter. See, e.g., Perry v. Del Rio, 66 S.W.3d 239, 252 (Tex. 2001) (orig. proceeding);
Curtis v. Gibbs, 511 S.W.2d 263, 267 (Tex. 1974) (orig. proceeding); Finlan v. Peavy, 205 S.W.3d 647, 651 (Tex.
App.—Waco 2006, no pet.); Gordon v. Jones, 196 S.W.3d 376, 385 (Tex. App.—Houston [1st Dist.] 2006, no pet.).
25
dominant jurisdiction does not apply to suits pending in other states. Texas courts may recognize
prior proceedings in other states as a matter of comity, but pendency of a proceeding in another
state does not oust the jurisdiction of Texas courts to entertain the same controversy.”). It is not
necessary, though, for us to determine whether the doctrine of dominant jurisdiction is applicable
to the facts of this case. 23 It does not appear that Liberty Mutual presented this argument to the
trial court. The error, if any, has not been preserved for appellate review. See TEX. R. APP. P.
33.1.
VII. Whether Section 71.051(e) Prohibits the Dismissal Has Not Been Preserved
In its final issue, Liberty Mutual argues that the trial court erred because Section
71.501(e) of the Texas Civil Practice and Remedies Code prohibits the dismissal of a personal
injury lawsuit filed by a Texas plaintiff. Section 71.051(e) states that a court “may not stay or
dismiss” a lawsuit if the plaintiff or some of the plaintiffs (provided they are properly joined and
the action arose from a single occurrence) are legal Texas residents. TEX. CIV. PRAC. & REM.
CODE ANN. § 71.051(e). To the best we can discern, Liberty Mutual is claiming it is a Texas
resident because its claim is derivative of Smith’s claim and Smith was a Texas resident at the
time the injury occurred. Transit Mix responds that this error has not been preserved and,
alternatively, that Liberty Mutual is not the plaintiff. Transit Mix argues that Smith is the
plaintiff as contemplated by the statute and Smith did not file the lawsuit in question.
23
We note Liberty Mutual raises the doctrine of comity in its reply brief. An appellant is prohibited from raising
new issues in a reply brief. See, e.g., Martin v. Martin, 363 S.W.3d 221, 237 (Tex. App.—Texarkana 2012, pet.
dism’d by agr.). We will not consider Liberty Mutual’s comity arguments.
26
Liberty Mutual has not directed us to any place in the record showing that this argument
was presented to the trial court. As argued by Transit Mix and conceded by Liberty Mutual,
Liberty Mutual did not direct the trial court to Section 71.051(e). Although Liberty Mutual
argued at the dismissal hearing that Smith was a Texas resident at the time Liberty Mutual filed
the lawsuit, Liberty Mutual merely advanced this reason as a factor opposing dismissal. Liberty
Mutual did not inform the trial court that the Texas forum non conveniens statute prohibits
transfer if a properly-joined plaintiff is a Texas resident. Liberty Mutual’s arguments to the trial
court were insufficient to make the trial court aware of any complaint under Section 71.051(e).
In order to preserve a complaint for appellate review, a party must present to the trial court a
timely request, objection, or motion “with sufficient specificity to make the trial court aware of
the complaint, unless the specific grounds were apparent from the context . . . .” TEX. R. APP. P.
33.1.
In its reply brief, Liberty Mutual argues that this issue is systemic error because it
violates a mandatory statute. As noted above, violation of a mandatory statute is often not
systemic error under Marin, and we are not willing to adopt the Marin error preservation
categories for civil cases not involving juvenile delinquencies. To the extent Liberty Mutual’s
argument can be interpreted as arguing the error is fundamental, we conclude the error is not
fundamental. See Pirtle, 629 S.W.2d at 920.
Liberty Mutual has not preserved this issue for our review.
27
VIII. Conclusion
Liberty Mutual’s subrogation claim, as a derivative claim, is a personal injury cause of
action and is governed by the Texas forum non conveniens statute. We conclude that Arkansas
law should apply to the facts of this case and that the trial court did abuse not its discretion in
dismissing Liberty Mutual’s lawsuit. 24 Liberty Mutual’s remaining issues are not preserved for
appellate review.
For the reasons stated, we affirm.
Bailey C. Moseley
Justice
Date Submitted: May 24, 2013
Date Decided: June 28, 2013
24
We note abatement is an option under forum non conveniens. Liberty Mutual argued, though, against abatement
in the trial court and has not requested abatement on appeal. We do not express any opinion concerning whether an
abatement might have been an appropriate remedy under the facts of this case.
28