## NO. 12

- 16

- 00126

- CV

IN THE COURT OF APPEALS

TWELFTH COURT OF APPEALS DISTRICT

TYLER, TEXAS

IN RE: RANDY RUTTER , ERIC JOINER, AND ERIC JOINER WHOLESAL E, LLC, RELATORS §
§
§ ORIGINAL PROCEEDING

MEMORANDUM OPINION By petition for writ of mandamus, Randy Rutter
, Eric Joiner, and Eric Joiner Wholesale,
LLC (Relators) challenge the trial court’s order denying their motion to dismiss

. 1 The real parties in interest are John and Beth Anne Miller. We deny the petition.

B ACKGROUND The Miller s purchased a vehicle at an auction

. Mecum Auction, I nc. conducted the auction, and R elators owned the vehicle

. The Millers received representations that they were purchasing a 1970 Chevr olet Chevelle LS6 automobile. After taking possession of the vehicle, the Millers suspected that they had been misled regarding certain aspects of the vehicle

. The Millers sued Mecum Auction and Relators
, alleging violation of the Deceptive Trade Practice s Act through the breach of the implied warranty of merchantability, fraud, negligence, negligent misreprese ntation, and breach of express and implied warranties.
Mecum Auction filed a motion to dismiss the Millers’ claims against it because Mecum
Auctio n and the Millers had entered into a contract that contained a forum selection clause.
R elators filed an answer to the Millers’ claims in which they contended that they were third party
beneficiaries to the contract betwee n Mecum Auction and the Millers. Thus
, they contended, the

1 The respondent is the Honorable Carter Tarrance, Judge of the 392nd Judicial District Court, Henderson County, Texas.2

forum selection clause appl ied to the Millers’ claims against them as well. The Millers filed a response to Me cum Auction’s motion to dismiss, and R elators filed a motion for joinder in Mecum Auction’s motion. Mecum Auction the n filed an amended motion to dismiss.
The trial court instructed R elators to provide additional briefing on the issue of the applicability of the forum selecti on clause to claims against non signatories to the contract.
R elators responded that direct benef its estoppel required all of the M illers’ claims to be
dismissed. The trial court granted Mecum Auction’s motion to dismiss , but denied R elators’
motion to dismiss. This original proceeding followed.

A VAILABILITY OF M ANDAMUS Ordinarily, mandamus will is sue only to correct a clear abuse of discretion where there is no adequate remedy by appeal. In re Cerberus Capital Mgmt., L.P. , 164 S.W.3d 379, 382 (Tex. 2005) (orig. proceeding); Walker v. Packer , 827 S.W.2d 833, 839

- 40 (Tex. 1992) (orig. proceeding)

. When a trial court refuses to enforce a valid forum selection clause, there is no adequate appellate remedy. In re Lyon Fin. Serv s . , Inc. , 257 S.W.3d 228, 231 (Tex. 2008) (orig. proceeding). Thus, when reviewing a trial court’s denial of a motion to dism iss based on a forum selection clause, our focus is whether the trial court clearly abused its discretion. To determine whether the trial court clearly abused its discretion, we consider whether the challenged ruling or order was one compelled by the fac ts and circumstances or was arbitrary, unreasonable, or reached without reference to any guiding rules or principles. In re Huag , 175 S.W.3d 449, 451 (Tex. App.

— Houston [1 st Dist.] 2005, orig. proceeding). A clear failure by the trial court to analyze or apply the law correctly will constitute an abuse of
discretion. Walker , 827 S.W.2d at 840.

D IRECT B ENEFITS E STOPPEL Relators contend that the trial court abused its discretion by denying their motion to
dismiss. They argue that direct benefits estoppel required the trial court to dismiss all of the Millers’ claims against them pursuant to the forum selection clause contained in the contract
between Mecum Auction and the Millers.3

Applicable Law Generally, a forum selection clause must be enforced. In re AIU Ins. Co. , 148 S.W.3d 109, 111

- 12 (Tex. 2004) (orig. proceeding). Under certain limited circumstances, a non signatory to the contract may enforce a forum selection clause against the claims brought by a signatory. Smith v. Kenda Capital, LLC , 451 S.W.3d 453, 458 (Tex. App.

— Houston [14 th Dist.] 2014 , no pet.). One such circumstance is when direct benefits estoppel applies

. Id. Texas courts first applied direct benefits estoppel to arbitration clauses in contracts. See In re Kellogg Brown & Root, Inc. , 166 S.W.3d 732, 739 (Tex. 2005) (orig. proceeding). Arbitration clauses are a specific type of forum selection clause, and thus, direct benefits estoppel can be applied to other
forum selection clauses as well. Smith , 451 S.W.3d at 457.
A claim seeks a direct benefit from a contract if liability under the claim “arises solely from the contract or must be determined by reference to it.” In re Weekley Homes, L.P. , 180 S.W.3d 127, 13 2 (Tex. 2005) (orig. proceeding). By contrast, a claim does not s eek a direct benefit from a contract if liability under the claim “arises from general obligations imposed by state law, including statutes, torts and other common law duties, or federal law.” In re Morgan Stanley & Co., Inc. , 293 S.W.3d 182, 184 n.2 (Tex

. 2009) (orig. proceeding) ; see also Weekley
Homes , 180 S.W.3d at 132 (r ecognizing that arbitration clause cou ld not be applied against a

non signatory when liability arises from general legal obligations )

. A nalysis Relators contend that the Millers’ claim s are based entirely upon representations made
about the Chev elle during the auction. W e agree with Relators’ assertion, but we do not read direct benefits estoppel to reach so far as to require dismissal of the Millers’ claims based solely
on this fact

. Although the conduct of which the Miller s complain occurred at the auction, the Millers’ claims arise from general obligations imposed by state law, rather than from any obligations imposed by Mecum Auction and the Millers’ contract. See id. We recently addressed an assertion of direct benefits estoppel with regard to an
arbitration clause. See Vines v. Durrett , No. 12

- 14

- 00258

- CV, 2015 WL 9591525 (Tex. App.

— Tyler July 1, 2016, pet. denied ) (mem. op.) . In that case, we recognized that the plaintiff’s c laim
that the defendant defrauded him alleged the breach of a common law duty, not a duty arising
under the contractual a greement containing the arbitration clause

. Id. at *3. Accordingly, the plaintiff 's suit d id not rely on any terms of the agreement, hinge on any rights arising from the4

agreement, or seek to enforce any duty created by the agreement. Id. Under those circumstances, we concluded that direct benefits estoppel does not apply. I d.
Because the Millers’ claims in this case likewise do not rely on any terms of the agreement, hinge on any rights arising from the agreement, or seek to enforce any duty created by the agreement, the trial court did not abuse its discretion when it determined that direct benefits estoppel did not apply. See id

.

P OLICY R EASONS FOR D ISMISSAL Relators further contend that two policy reasons require d the trial court to dismiss the Millers’ claims. However, we have reviewed the mandamus record, and we see no indication
that Relators made these policy arguments to t he trial court. Texas Rule of Appellate Procedure 33.1 provides that as a prerequisite to presenting a complaint for appellate review, the reco rd must show that the complaint was made to the trial

court. T EX

. R. A PP

. P. 33.1(a)(1)(A). This rule of error preservation applies to mandamus proceedings. See In re E. Tex. Med. Ctr. Athens , 154 S.W.3d 933, 937 (Tex. App.

— Tyler 2005, orig. proceeding); see also In re Bank of Am. , No. 01

- 02

- 00867

- CV, 2003 WL 22310800, at *2 (Tex. App.

— Houston [1 st Dist.] Oct. 9, 2003, orig. proceeding). Accordingly, we do not address Relators’ policy arguments.

D ISPOSITION Because direct estoppel does not apply, the trial court did not abuse its discretion in denying Relators’ motion to dismiss

. Accordingly, we deny Relators’ p etition for writ of
mandamus

.

B RIAN H OYLE Justic e Opinion delivered August 24 , 2016. Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J.

( PUBLISH )

## COURT OF APPEALS

TWELFTH COURT OF APPEALS DISTRICT OF TEXAS

JUDGMENT

AUGUST 24 , 2016

N O. 12

- 16

- 00126

- CV

RANDY RUTTER , ERIC JOINER, AND ERIC JOINER WHOLESAL E, LLC

Relators V. HON. CARTER TARRANCE ,

Respondent

Appeal from the 392nd District Court of Henderson County, Texas (Tr.Ct.No. CV15

- 0244

- 392) ON THIS DAY came to be heard the petition for writ of mandamus filed by RANDY RUTTER , ERIC JOINER , AND ERIC JOINER WH OLESALE, LLC , who are the relator s in Cause No. CV15

- 0244

- 392 , pending on the docket of the 3 92nd Judicial District
Court of Henderson County, Texas. Said petition for writ of man damus having been filed herein

on April 2 7, 201 6 , and the same having been duly considered, because it is the opinion of this Court that a writ of mandamus should not issue, it is therefore CONSIDERED, ADJUDGED and ORDERED that the said petition for writ o f mandamus be, and the same is, hereby D ENIED

.

B rian Hoyle , Justice

. Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J

.