Texas Civil Practice and Remedies Code
Sec. § 140.004
Contractual Subrogation Rights Authorized


An issuer of a plan that provides benefits described by Section 140.002 under which the policy or plan issuer may be obligated to make payments or provide medical or surgical benefits to or on behalf of a covered individual as a result of a personal injury to the individual caused by the tortious conduct of a third party may contract to be subrogated to and have a right of reimbursement for payments made or costs of benefits provided from the individuals recovery for that injury, subject to this chapter.
Added by Acts 2013, 83rd Leg., R.S., Ch. 180 (H.B. 1869), Sec. 1, eff. January 1, 2014.
Sec. 140.005. PAYORS RECOVERY LIMITED. (a) If an injured covered individual is entitled by law to seek a recovery from the third-party tortfeasor for benefits paid or provided by a subrogee as described by Section 140.004, then all payors are entitled to recover as provided by Subsection (b) or (c).

(b)

This subsection applies when a covered individual is not represented by an attorney in obtaining a recovery. All payors share under Subsection (a) of a covered individuals recovery is an amount that is equal to the lesser of:

(1)

one-half of the covered individuals gross recovery; or

(2)

the total cost of benefits paid, provided, or assumed by the payor as a direct result of the tortious conduct of the third party.

(c)

This subsection applies when a covered individual is represented by an attorney in obtaining a recovery. All payors share under Subsection (a) of a covered individuals recovery is an amount that is equal to the lesser of:

(1)

one-half of the covered individuals gross recovery less attorneys fees and procurement costs as provided by Section 140.007; or

(2)

the total cost of benefits paid, provided, or assumed by the payor as a direct result of the tortious conduct of the third party less attorneys fees and procurement costs as provided by Section 140.007.

(d)

A common law doctrine that requires an injured party to be made whole before a subrogee makes a recovery does not apply to the recovery of a payor under this section.
Added by Acts 2013, 83rd Leg., R.S., Ch. 180 (H.B. 1869), Sec. 1, eff. January 1, 2014.
Sec. 140.006. ATTORNEYS FEES IN DECLARATORY JUDGMENT ACTION. Notwithstanding Section 37.009 or any other law, if a declaratory judgment action is brought under this chapter, the court may not award costs or attorneys fees to any party in the action.
Added by Acts 2013, 83rd Leg., R.S., Ch. 180 (H.B. 1869), Sec. 1, eff. January 1, 2014.
Sec. 140.007. ATTORNEYS FEES IN RECOVERY ACTION. (a) Except as provided by Subsection (c), a payor of benefits whose interest is not actively represented by an attorney in an action to recover for a personal injury to a covered individual shall pay to an attorney representing the covered individual a fee in an amount determined under an agreement entered into between the attorney and the payor plus a pro rata share of expenses incurred in connection with the recovery.

(b)

Except as provided by Subsection (c), in the absence of an agreement described by Subsection (a), the court shall award to the attorney, payable out of the payors share of the total gross recovery, a reasonable fee for recovery of the payors share, not to exceed one-third of the payors recovery.

(c)

If an attorney representing the payors interest actively participates in obtaining a recovery, the court shall award and apportion between the covered individuals and the payors attorneys a fee payable out of the payors subrogation recovery. In apportioning the award, the court shall consider the benefit accruing to the payor as a result of each attorneys service. The total attorneys fees may not exceed one-third of the payors recovery.
Added by Acts 2013, 83rd Leg., R.S., Ch. 180 (H.B. 1869), Sec. 1, eff. January 1, 2014.
Sec. 140.008. FIRST-PARTY RECOVERY. (a) Except as provided by Subsection (b), a payor of benefits may not pursue a recovery against a covered individuals first-party recovery.

(b)

A payor of benefits may pursue recovery against uninsured/underinsured motorist coverage or medical payments coverage only if the covered individual or the covered individuals immediate family did not pay the premiums for the coverage.
Added by Acts 2013, 83rd Leg., R.S., Ch. 180 (H.B. 1869), Sec. 1, eff. January 1, 2014.
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Dec. 5, 2019