Affirmed and Memorandum Opinion filed November 26, 2013.

In The

Fourteenth Court of Appeals

NO. 14-11-00577-CV

ALPER T. KARAALI, Appellant

V.

PETROLEUM WHOLESALE, L.P., Appellee

On Appeal from the 333rd District Court

Harris County, Texas

Trial Court Cause No. 2007-46858

M E M O R A N D U M O P I N I O N

Appellant Alper T. Karaali1appeals from the trial court’s final judgment in 

favor of Petroleum Wholesale, L.P., which was based on an arbitration award. He 

 

1 Both Karaali and Tien Shan, Inc., the other maker on the note that forms the basis of the 

suit underlying this appeal, filed a notice of appeal. Their attorney was permitted to withdraw 

while this appeal was pending. Karaali then appeared pro se. On January 15, 2013, we notified 

the parties that unless counsel appeared on behalf of Tien Shan, Inc. on or before January 28, 

2013, we would dismiss the corporation’s appeal. Because no counsel appeared on behalf of 

Tien Shan, Inc., we ordered its appeal dismissed on February 12, 2013. See Kunstoplast of Am., 

Inc. v. Formosa Plastics Corp., U.S.A., 937 S.W.2d 455, 456 (Tex. 1996).
2

raises five issues, but three were not preserved in the trial court so we do not reach 

them. An additional issue regarding the scope of the arbitrator’s authority was not 

adequately briefed in this Court, and in any event it fails on the merits. Kaarali 

also challenges the sufficiency of the evidence supporting the arbitration award, 

but a court may not set aside an arbitration award on that basis. Accordingly, after 

carefully reviewing the record and briefs, we affirm the trial court’s judgment.

BACKGROUND

Petroleum Wholesale is the assignee and holder of a real estate lien note (the 

―Note‖) between Tien Shan, Inc. and Karaali2as maker and Craig C. Stavinoha, 

Inc./Craig C. Stavinoha, individually as payee. In August 2007, Tien Shan and 

Karaali sued Petroleum Wholesale after a dispute arose regarding calculation of the 

interest rate and the remaining amount due under the Note. The Note provided for 

interest calculated at prime plus two percent, which, at the time Petroleum 

Wholesale acquired it, was six percent. The Note further provided for adjustment 

of the interest rate on a quarterly basis on January 6, April 6, July 6, and October 6 

of each year in which the Note remained outstanding. 

Petroleum Wholesale answered and later filed a counter-claim seeking a 

declaratory judgment regarding the adjustable interest rate provision.3 The trial 

court signed an order referring the parties to mediation with Stuart Wilson pursuant

to chapter 154 of the Texas Civil Practice & Remedies Code.

The parties mediated this dispute in early May 2009. They entered into a 

Binding Settlement Agreement, in which they agreed to settle their entire dispute

 

2 Karaali signed the note in his individual capacity and also on behalf of Tien Shan, as 

―Shareholder, Director and Officer of Tien Shan, Inc.‖ 

3 Before the counterclaim was filed, the trial court signed a partial summary judgment in 

favor of Tien Shan and Karaali, declaring that as of May 6, 2004, the principal balance of the 

Note was $1,438,381.62. 
3

and release each other from all claims in the suit. Under the terms of the 

Agreement, Tien Shan and Karaali agreed to pay Petroleum Wholesale $1,225,000 

for full and final payment of the Note. Petroleum Wholesale agreed to pay 

$52,000 to Tien Shan and Karaali to reimburse them for overpayments on the 

Note. 

The transaction was scheduled to occur contemporaneously on or before 

August 12, 2009. Tien Shan and Karaali were to obtain refinancing of their 

portion of the settlement funds; the title company closing the refinancing loan 

would establish an escrow agreement whereby Petroleum Wholesale would deposit

$52,000, to be released to Tien Shan and Karaali upon Petroleum Wholesale’s 

receipt of the $1,225,000. If the refinancing transaction did not close by August 

12, 2009, the title company was authorized to return the $52,000 to Petroleum 

Wholesale on or before August 19, without permission of Tien Shan or Karaali. 

Tien Shan and Karaali were required to make monthly payments of $9,554 to 

Petroleum Wholesale for the months of June, July, and August 2009; however, 

they were not entitled to any credit for these payments against the settlement 

amount or, if the refinance did not close, against the remaining principal and 

interest due and owing. If the transaction did not close, Tien Shan and Karaali 

were still required to make payments under the terms of the Note, with the monthly 

payments after August 2009 credited against the remaining principal and interest 

due and owing.

The Settlement Agreement also contained the following arbitration clause:

If one or more disputes arise with regard to the interpretation and/or 

performance of this agreement or any of its provisions, the parties 

agree and designate Stuart N. Wilson as . . . binding arbitrator of any 

disputes in the language of this Settlement Agreement or release, or 

other closing documents executed in accordance with this Agreement, 
4

and the parties agree that the part[ies] shall pay their pro rata share of 

the arbitrator’s fee upon receipt of an invoice from Stuart N. Wilson.

The Settlement Agreement stated that the parties had entered into it freely and 

without duress after consulting with the professional of the party’s choice. It was 

signed by Karaali, both individually and on behalf of Tien Shan, Inc., a 

representative of Petroleum Wholesale, counsel for each party, and the mediator.

In June 2010, Petroleum Wholesale filed a motion to compel arbitration.4 In 

this motion, Petroleum Wholesale stated that the parties reached a Binding 

Settlement Agreement in May 2009, but since that time, they have ―disputed the 

effect of the Agreement since the Agreement was not performed as anticipated.‖ 

According to this motion, the parties agreed to submit all disputes under the 

agreement to arbitration with Stuart Wilson. Petroleum Wholesale stated that the 

parties and the arbitrator had had scheduling problems until a date was scheduled 

in March 2010. According to Petroleum Wholesale’s motion, at that time, Tien 

Shan and Karaali stated they did not want to attend arbitration. Petroleum

Wholesale requested an order compelling Tien Shan and Karaali to submit to 

arbitration with Wilson as agreed by the parties. The motion to compel arbitration 

was set for oral hearing on June 25, 2010. On that date, the trial court granted 

Petroleum Wholesale’s motion and signed an order compelling ―the cause‖ to

arbitration. The parties were ordered to submit ―the cause‖ to arbitration with 

Wilson on or before September 24, 2010, and to pay fifty percent of Wilson’s fees 

on or before July 16, 2010.

In August 2010, Tien Shan filed a motion to extend the deadlines set forth in 

the trial court’s order compelling arbitration. In this motion, it asserted it was 

 

4

Petroleum Wholesale attached a copy of the Settlement Agreement to its motion to 

compel arbitration.
5

financially unable to afford arbitration at this time. It further stated, ―Although 

[Tien Shan] made diligent efforts to arbitrate, the arbitration was postponed or 

rescheduled several times and [Tien Shan]’s financial condition has since changed 

for the worse and the cost associated with arbitrating this claim has become 

otherwise unaffordable at this time.‖ Tien Shan sought an extension of the 

deadline for arbitration until November 2010 to allow it to obtain the necessary 

funds to pay the arbitration fees. 

The trial court signed an agreed order extending arbitration deadlines on 

October 22, 2010. In this order, the court stated that the parties had agreed to Tien 

Shan’s motion to extend the arbitration deadlines. The court ordered the parties to 

submit ―the cause‖ to arbitration with Stuart Wilson on November 17, 2010, and to 

pay fifty percent of their arbitration fees on or before that date. Counsel for both 

parties signed this order as ―Agreed, Approved and Entry Requested.‖

The arbitrator made an arbitration award setting forth his findings and filed 

his award with the trial court on December 6, 2010. On December 30, Petroleum 

Wholesale filed a verified motion to confirm the arbitration award. Petroleum 

Wholesale attached to its motion the Settlement Agreement, the order compelling 

arbitration, the agreed order extending the arbitration deadlines, and the arbitration 

award. In pertinent part, the arbitration award provided as follows:

The case was called to arbitration before Stuart N. Wilson on November 

17, 2010, pursuant to an agreed order signed by counsel for all parties 

and the trial court on October 22, 2010. 

Petroleum Wholesale appeared at the arbitration hearing, but although 

duly noticed and ordered to appear by agreement, Tien Shan, Inc. and 

Karaali failed to appear. 

The arbitrator contacted Karaali and again notified him to attend pursuant 

to the agreed order. Karaali advised the arbitrator that he would not 

attend, without good cause. 
6

The arbitration was convened in the absence of Karaali.

The award reflects that, after hearing sworn testimony and accepting 

documentary evidence from Petroleum Wholesale, the arbitrator made the 

following relevant findings by a preponderance of the evidence submitted:

The Note provides that for all unpaid principal and mature, 

unpaid amounts, ―the applicable interest rate is the prime 

interest rate . . . plus two percentage points. This interest rate of 

prime plus two percent is adjustable on a quarterly basis . . . and 

. . . will be adjusted at the next quarterly interest computation 

date . . . [.]‖ (Emphasis added.)

The Note proves that ―Maker and each . . . guarantor waive all 

demands for payment, [and] presentations for payment. . . []‖

The terms of the Note and the Note payment history provide 

that the Note balance as of this date and including through 

December 5, 2010 is $1,258,227.96.

The terms of the Note and the current Note balance provide that 

the current monthly payment amount is $11,350.47.

The Binding Settlement Agreement between the parties was 

breached by KARAALI’s failing to pay off the Note by August 

12, 2009. There is a failure of consideration for [Petroleum 

Wholesale]’s agreement to accept on or before August 12, 2009 

a reduced payoff of the Note and ―reimbursement‖ to 

KARAALI for alleged ―overpayment‖. KARAALI’s payments 

made outside the Note in June, July, and August 2009 were in 

consideration of [Petroleum Wholesale]’s passing the then 

pending trial date and waiting 3 months for payoff of the Note.

Based on his findings, the arbitrator decreed that (1) Petroleum Wholesale was the 

holder of the Note signed by Tien Shan, Inc. and Karaali as makers, and that its 

balance as of December 6, 2010 was $1,258,227.96, with a current monthly 

payment of $11,350.47; (2) Tien Shan and Karaali take nothing from Petroleum 

Wholesale; and (3) Petroleum Wholesale recover from Tien Shan and Karaali, 

jointly and severally, attorney’s fees of $42,550, as well as its costs, including the 
7

mediation fee of $650 and the arbitration fee of $4,250.5 The motion to confirm 

the arbitration award was set for hearing on January 14, 2011.

On January 10, Tien Shan and Karaali responded to Petroleum Wholesale’s 

motion to confirm the arbitration award and moved to modify or vacate the award. 

They also requested an evidentiary hearing, asserting that an application to modify 

or correct an arbitration award may be joined in the alternative with an application 

to vacate the award. In this filing, they asserted that they never agreed to arbitrate 

the merits of this case, which was arbitrated in their absence.6 They asserted that 

the arbitrator exceeded his authority in making the award because the arbitration 

clause in the Settlement Agreement provided that the parties agreed to arbitrate 

―[i]f . . . disputes ar[o]se with regard to the interpretation and/or performance of 

this agreement or any of its provisions.‖ They sought, as relevant to this appeal, to 

modify or vacate the arbitration award because disputes related to the interest rate 

and the current balance of the Note were not disputes regarding interpretation or 

performance of the Settlement Agreement. 

Petroleum Wholesale replied to this response on January 13, asserting that 

because the parties settled the entire dispute through the Settlement Agreement, by 

necessary implication, the parties agreed to arbitrate all issues regarding settlement

of the dispute. Petroleum Wholesale further argued that by failing to object to the 

trial court’s order compelling the parties to arbitrate the cause, agreeing to the trial 

court’s order extending the deadlines to arbitrate the cause, and failing to attend 

 

5

The arbitrator also ordered that Tien Shan and Karaali, jointly and severally, pay their 

arbitration fee of $4,250 to Stuart N. Wilson & Associates, P.C.

6

They alleged in a footnote that they dismissed their counsel ―when they learned for the 

first time on November 16, 2010 that an arbitration had been set for November 17, 2010. The 

arbitrator refused to reset the arbitration to allow [them] to obtain new counsel.‖ 
8

the agreed-upon arbitration without good cause, Tien Shan and Karaali waived any 

complaint about the scope of the arbitration award. 

Tien Shan and Karaali responded to this reply on January 14, arguing that 

Petroleum Wholesale’s motion to compel arbitration—upon which the agreed 

order extending the deadlines was based—specifically referred to the arbitration 

clause contained in the Settlement Agreement. Thus, they asserted that the context 

of the order compelling arbitration made it clear that Petroleum Wholesale was 

seeking arbitration of issues related to the agreement, not arbitration of issues in 

the underlying case.7

On May 17, 2011, the trial court signed an order confirming the arbitration 

award and holding that any complaint regarding the scope of the arbitration had 

been waived.

8

 That same day, the court signed a final judgment incorporating the 

arbitrator’s award described above, confirming the balance of the Note and the 

current monthly payment due on it, rendering a take-nothing judgment against Tien 

Shan and Karaali, and awarding Petroleum Wholesale attorney’s fees and costs. 

 

7

Tien Shan and Karaali filed a memorandum of law concerning waiver on March 7, 

2011. This memorandum reflects that the trial court instructed counsel for both parties to file 

memoranda regarding whether they had waived their complaints that the arbitrator rendered an 

award outside the scope of the written arbitration agreement by not attending the arbitration. The 

record does not contain Petroleum Wholesale’s memorandum.

8

In this order, the trial court noted:

As part of its review (but not by way of limitation), the Court notes not only the 

language of the settlement agreement, but the Court’s prior orders of June 25, 

2010 and October 20, 2010, which by agreement requested the Court submit ―this 

cause‖ to the arbitrator. No restriction on the submission to arbitration was 

requested by the parties or ordered by the Court. Moreover, there is no evidence 

that either party made any complaint to the arbitrator regarding the scope of 

arbitration or requested him to modify the arbitration award. To the contrary, 

although duly ordered and noticed to appear, Plaintiffs wholly failed to appear or 

participate in arbitration. Hence, any complaint has been waived.
9

Tien Shan and Karaali filed a motion for new trial asserting that they were 

entitled to an evidentiary hearing, as requested in their response and motion to 

modify or vacate the arbitration award. They further argued that they had not 

waived their complaint that the arbitrator decided matters outside the scope of the 

arbitration agreement. This motion was overruled by operation of law, and Tien 

Shan and Karaali timely noticed their appeal.9

ANALYSIS

Karaali challenges the trial court’s judgment in five issues.10 First, he 

asserts that Petroleum Wholesale is not a correct party to this proceeding because it 

fraudulently claimed assignment of the Note. Second, Karaali claims that when he 

objected to Petroleum Wholesale’s status as an assignee of the Note, he and 

Petroleum Wholesale entered into a new financing agreement that provided for a 

fixed interest rate of six percent. In issue three, he contends that the arbitrator 

exceeded his authority and the scope of the Settlement Agreement because the 

arbitration award does not reflect the settlement amount agreed upon, the amount 

Karaali originally was determined to owe, or the amount Petroleum Wholesale 

claimed he owed. Karaali complains in his fourth issue that the trial court lacked 

evidence upon which to base its judgment stating the amount due on the Note. 

Finally, in his fifth issue, he argues that his debt was fraudulently inflated by 

 

9

This appeal was abated in September 2011 because Tien Shan, Inc. petitioned for 

voluntary bankruptcy protection. Karaali later sought voluntary bankruptcy protection for 

himself. Karaali provided this court with copies of the bankruptcy court’s orders dismissing both 

bankruptcy proceedings, and this appeal was reinstated on January 15, 2013. As noted above, 

however, Tien Shan was dismissed from this appeal because it failed to obtain legal 

representation.

10 In support of some of these issues, Karaali attached numerous documents as exhibits to 

his brief. Many of Karaali’s exhibits are not part of our appellate record, including his exhibits 

2, 6, 9, 11, 12, 15, 16, 20, 21, 23, 24, 25, and 26. We have not considered any of those 

documents in addressing Karaali’s issues. See Bencon Mgmt. & Gen. Contracting, Inc. v. Boyer, 

Inc., 178 S.W.3d 198, 210–11 (Tex. App.—Houston [14th Dist.] 2005, no pet.). 
10

Petroleum Wholesale and further inflated by the arbitration award. Petroleum 

Wholesale responds that Karaali’s first, second, fourth, and fifth issues were not 

properly preserved for our review. We agree that Karaali failed to preserve his 

first, second, and fifth issues.

I. Preservation of error

Generally, to present a complaint for appellate review, the record must show 

that the complaint was made to the trial court by a timely request, objection, or 

motion stating with sufficient specificity the grounds for relief sought and that the 

trial court ruled on the complaint, either expressly or implicitly. See TEX. R. APP.

P. 33.1(a); see also In re A.L.S., 338 S.W.3d 59, 70 (Tex. App.—Houston [14th 

Dist.] 2011, pet. denied) (―Brown did not raise this argument at any time below; 

therefore, she has preserved nothing for review.‖); Fontenot v. Stinson, 369 S.W.3d 

268, 276 n.10 (Tex. App.—Houston [14th Dist.] 2011, pet. filed) (noting that 

appellant’s constitutional claims that were not presented to trial court would not be 

addressed on appeal). Important prudential considerations underlie error 

preservation rules. In re B.L.D., 113 S.W.3d 340, 350 (Tex. 2003). Our error 

preservation rules promote such important concerns as conserving judicial 

resources by permitting trial courts the opportunity to correct error before an 

appeal proceeds; encouraging fairness among litigants by preventing a party from 

unfairly surprising his opponent on appeal by stating his complaint for the first 

time; increasing accuracy in judicial decision-making by giving lower courts the 

chance to first consider and rule on error; and providing the parties the chance to 

develop and refine their arguments so that courts of appeal may focus on and 

analyze the key issues at issue. See id. (citations omitted). 

After carefully reviewing the record, we have determined that Karaali never 

presented the following arguments to the trial court: that Petroleum Wholesale is 
11

not a proper party to these proceedings or that it ―fraudulently‖ claimed assignment 

of the Note; that Karaali and Petroleum Wholesale entered into a ―new‖ financing 

agreement with a fixed six-percent interest rate; or that Petroleum Wholesale 

―fraudulently‖ inflated his debt and that the arbitration award further inflated his 

debt. Because Karaali failed to present these arguments to the trial court, he has 

not preserved them for our review. See TEX. R. APP. P. 33.1(a). Accordingly, we 

overrule these arguments, which comprise Karaali’s first, second, and fifth issues.

II. The arbitrator’s authority

In his third issue, Karaali asserts that the arbitrator exceeded his authority 

and exceeded the scope of the arbitration agreement. Specifically, he claims that 

the arbitration award does not reflect the settlement amount, the amount owed by 

Karaali and Tien Shan originally, or the amount Petroleum Wholesale claimed it 

was owed by Karaali and Tien Shan. We conclude that Karaali waived this issue 

by failing to brief it properly.

We begin by noting that Karaali, who filed his appellate briefs pro se, is held 

to the same standard as a licensed attorney and must comply with all applicable 

rules of procedure. Canton-Carter v. Baylor Coll. of Med., 271 S.W.3d 928, 930 

(Tex. App.—Houston [14th Dist.] 2008, no pet.). A pro se litigant must properly 

present his case on appeal; if this were not the rule, pro se litigants would benefit 

from an unfair advantage over those parties who are not represented by counsel. 

Id. We will not make allowances for or apply different standards because a case is 

presented by a pro se litigant. Id. 

Although Karaali identifies his third issue as a challenge to the arbitrator’s 

authority to determine the amount owed on the Note, it is difficult to discern the 

argument in support of this issue. The entire argument section of his brief is 

contained in a single page. Appellant seemingly attempts to incorporate by 
12

reference the argument and authorities provided in his response to Petroleum 

Wholesale’s motion to confirm the arbitration award and motion to modify or 

vacate the award, which is attached to his brief as Exhibit 19.11 But the Rules of 

Appellate Procedure require that the brief contain a clear and concise argument for 

the contentions made, with appropriate citations to authorities and to the record. 

TEX. R. APP. P. 38.1(i). Karaali makes several conclusory statements and cites 

three cases, but he does not apply these cases or provide any analysis in support of 

this issue. Appellant provides no record references in his argument section.12 

Brief conclusory statements unsupported by legal authority do not suffice to 

meet the requirements of our briefing rules. See Collins v. Walker, 341 S.W.3d 

570, 575 (Tex. App.—Houston [14th Dist.] 2011, no pet.) (citing Tex. R. App. P. 

38 and Valadez v. Avitia, 238 S.W.3d 843, 845 (Tex. App.—El Paso 2007, no 

pet.)). Even construing Karaali’s appellate brief liberally, we cannot conclude that 

he has briefed this issue adequately. See Tex. R. App. P. 38.1(i); see also San 

Saba Energy L.P. v. Crawford, 171 S.W.3d 323, 338 (Tex. App.—Houston [14th 

Dist.] 2005, no pet.). Because of this inadequate briefing, Karaali has waived his 

third issue. See TEX. R. APP. P. 38.1(i); Collins, 341 S.W.3d at 575; CantonCarter, 271 S.W.3d at 930–32; Valadez, 238 S.W.3d at 845; San Saba Energy 

L.P., 171 S.W.3d at 338.

In any event, the challenge Kaarali appears to be making to the arbitrator’s 

authority fails on the merits. An arbitrator’s authority is derived from the 

 

11 Although our rules of appellate procedure allow a party to adopt by reference another 

document filed by ―another party in the same case,‖ this rule does not apply to a party’s attempt 

to incorporate into a brief a motion filed in the trial court by the same party. See TEX. R. APP. P.

9.7 (―Any party may join in or adopt by reference all or any part of a brief, petition, response, 

motion, or other document filed in an appellate court by another party in the same case.‖ 

(emphasis added)).

12 Karaali also provides no record reference in the facts section of his brief.
13

arbitration agreement and is limited to a decision of the matters contained therein, 

either expressly or by necessary implication. Baker Hughes Oilfield Operations, 

Inc. v. Henning Prod. Co., 164 S.W.3d 438, 443 (Tex. App.—Houston [14th Dist.] 

2005, no pet.). The arbitration clause of the Settlement Agreement applies to 

―disputes [arising] with regard to the interpretation and/or performance of this 

agreement or any of its provisions[.]‖ 

As described above, the Settlement Agreement provided that if Tien Shan 

and Karaali failed to obtain refinancing to pay $1,225,000 in full and final payment 

of the Note by August 12, 2009, they were required to make payments under the 

terms of the Note. Thus, when Karaali failed to make this payment, the terms of 

the Note—including the balance owing and the applicable interest rate—became 

relevant to performance of the Agreement. Because the Note provided for an 

adjustable interest rate based on the prime rate plus two percent, it was necessary 

for the arbitrator to resolve the parties’ disputes regarding the balance owing and 

the interest rate so he could calculate Tien Shan and Karaali’s proper monthly 

payments. The arbitrator did not exceed his authority by resolving these disputes 

in order to determine the payments due under the Note—a matter expressly 

contained in the Agreement. Accordingly, we overrule Karaali’s third issue.

III. Lack of “documents” to support trial court’s determination of balance 

due on note

In Karaali’s fourth issue, he asserts that the trial court did not have 

―documents‖ to make a decision regarding the remaining balance on the Note. We 

construe this issue as a challenge to the sufficiency of the evidence to support the 

trial court’s judgment.

The parties do not dispute that they entered into a valid, binding arbitration 

agreement. Texas law favors arbitration. Id. at 442; IPCO-G.&C. Joint Venture v. 
14

A.B. Chance Co., 65 S.W.3d 252, 255–56 (Tex. App.—Houston [1st Dist.] 2001, 

pet. denied). An arbitration award has the same effect as the judgment of a court 

of last resort; a reviewing court may not substitute its judgment for that of the 

arbitrator merely because it would have reached a different result. Baker Hughes 

Oilfield Operations, Inc., 164 S.W.3d at 442. A reviewing court also may not set 

aside an arbitration award for a mistake of fact or law. Id. Indeed, our review of 

an arbitration award is extremely limited, and we lack authority to review 

complaints unless they concern statutory, common law, or public policy grounds to 

vacate or modify the award. See id. Sufficiency of the evidence to support the 

award is neither a statutory nor a common-law ground for vacating or modifying 

an arbitration award. See IPCO-G.&C. Joint Venture, 65 S.W.3d at 256. 

Accordingly, we lack authority to review Karaali’s fourth issue, and it is overruled.

CONCLUSION

For the foregoing reasons, we have overruled all five of Karaali’s appellate 

issues. We therefore affirm the trial court’s judgment.

/s/ J. Brett Busby

Justice

Panel consists of Chief Justice Frost and Justices Busby and Donovan.