Shafqat ALI a/k/a Michael Ali, Individually and as First Alternate Independent Executor of the Estate of Amjad "A.J." Sultan, Deceased, Appellant v. Darlene Payne SMITH, Successor Administrator with will Annexed of the Estate of Amjad "A.J." Sultan, Deceased, Appellee

NO. 14-18-00003-CV

Court of Appeals of Texas, Houston (14th Dist.).

Opinions filed July 10, 2018

James E. Doyle, Andrea Barr, Houston, TX, for Appellant.

C. Henry Kollenberg, David Polsinelli, Darlene Payne Smith, Houston, TX, for Appellee.

Panel consists of Justices Jamison, Wise, and Jewell.

Ken Wise, Justice

This is an appeal from the denial of a motion to compel arbitration based on an arbitration clause contained in a will. Darlene Payne Smith is the successor administrator with will annexed for the estate of Amjad "A.J." Sultan. Smith brought this underlying action against Shafqat "Michael" Ali, the former independent executor for the estate, alleging that Ali failed to responsibly handle the finances of the estate, converted assets of the estate, and used estate funds in violation of his fiduciary duties.

Ali filed a motion to compel arbitration based on an arbitration provision contained in Sultan's will. The trial court denied the motion, and Ali brings this interlocutory appeal.

In this appeal, we assume that courts must enforce a testator's intent, as reflected in the will, that "all disputes" between executors and their successors be resolved through binding arbitration. But, because the Texas Arbitration Act requires the party seeking to compel arbitration to show the existence of an "agreement" to arbitrate, courts may not compel arbitration under the Act unless the will is "supported by the mutual assent required to render the [will] an agreement and the arbitration provision valid." *See**Rachal v. Reitz* , 403 S.W.3d 840, 845 (Tex. 2013) (enforcing arbitration provision in a trust based on theory of direct-benefits estoppel).

We hold that Ali failed to meet his burden to show the existence of a valid arbitration agreement amongst non-signatories based on a theory of direct-benefits estoppel.

*758Thus, the trial court did not err, and we affirm.

**Background**

In the will, Sultan appointed Ali as one of several alternate independent executors. After Sultan's death, the trial court appointed Ali as the independent executor. Ali resigned from the position after Sultan's adult son applied for a temporary restraining order and injunction against Ali for alleged mismanagement of the estate, breaches of fiduciary duties, failures to distribute estate property, and a failure to establish a testamentary trust for Sultan's minor children. The trial court signed an order stating that Ali resigned as the independent executor, that no subsequent named executors were suitable to serve, and that the parties agreed to the appointment of a third party as a successor administrator with will annexed. The court appointed Smith as the administrator.

Smith then brought this underlying action against Ali. Under the heading "facts" in the petition, Smith alleges that Ali (1) "failed to responsibly handle the finances of the estate"; (2) "caused the Estate to be damaged and caused unnecessary expenses"; and (3) "refused to produce or file an accounting in the estate, in any form." Smith also alleges that assets of the estate that came into Ali's possession "have been wasted, misappropriated, converted or otherwise disposed of inappropriately by Defendant Ali."

Under the heading "declaratory judgment," Smith requests a declaratory judgment as follows:

> Darlene Payne Smith, as Successor Administrator with Will Annexed, seeks a declaratory judgment against Defendant Ali, as former Independent Executor of the Estate, for a finding that he has failed to perform or has committed the following acts:

> 1. Failed to responsibly handle the finances of the estate and related entities;

> 2. Converted assets of the Estate to his own personal use; and

> 3. Used estate funds in violation and dereliction of his fiduciary duties;

> The above described acts of Defendant Ali constitute failure on his part to carry out the duties and responsibilities of his position as former Independent Executor of the Estate. By his actions, Defendant Ali has failed to well and truly perform his duties and obligations as Independent Executor, thereby causing damage to the Estate in the amount of at least $250,000.00.

Ali filed a motion to compel arbitration based on the following provision in the will:

> If a dispute arises between or among any of the beneficiaries of my estate, the beneficiaries of a trust created under my Will, the Executor of my estate, or the Trustee of a trust created hereunder, or any combination thereof, such dispute shall be resolved by submitting the dispute to binding arbitration. It is my desire that all disputes between such parties be resolved amicably and without the necessity of litigation.

Ali argued that the Texas Arbitration Action, Tex. Civ. Prac. & Rem. Code §§ 171.001 -.098, required arbitration although the parties were non-signatories to the will.

Ali referred to the doctrine of direct-benefits estoppel in the motion and elaborated in his later reply in support of his motion that Smith "accepted benefits under the Will, including her claims, compensation and payment of attorneys' fees." Ali attached the trial court's "order authorizing appointee fees," in which the trial court authorized Smith to collect $51,777.07 from *759the funds of the estate for reasonable compensation of necessary services in her position as successor administrator with will annexed.

Ali also argued in the reply in support of his motion that Smith's claim was within the scope of the arbitration provision because the will defines "Executor" broadly to include "successors" such as Smith. The will provides:

> Unless another meaning is clearly indicated or required by context or circumstances, the term "Executor" or "Trustee" shall also mean and include any Co-Executors, Co-Trustees, alternates, or successors.

After a hearing, at which the trial court took judicial notice of the court's file, the trial court signed an order denying Ali's motion to compel arbitration. Ali brings this appeal with the following issues presented:

> 1. Does the Texas General Arbitration Act or any other statute or case precedent bar arbitration clauses in a will, which governs fiduciary duties, and successor administrators or executors, and does the Successor cite any law to support her position in the Court Record of the Underlying Suit?

> 2. Can the successor administrator of the Estate of Amjad "A.J." Sultan receive compensation under the Will, bring claims under the Will of Amjad "A.J." Sultan, and enforce the provisions of the Will while simultaneously refusing to comply with its arbitration provision?

> 3. Are the claims raised within the arbitration provision's scope when the Will provides that executor includes alternates and successors and the claim is "by or among" the Successor and the Former Executor?

> 4. Did the Court abuse its discretion in denying the Appellant's Motion?

**Direct-Benefits Estoppel**

Ali's second issue is dispositive, so we need not address whether there is any categorical bar to arbitration provisions in wills, or whether Smith's claims are within the scope of the arbitration provision. *See* Tex. R. App. P. 47.1

In his second issue, Ali contends that the trial court erred by not enforcing the will's arbitration clause under the Texas Arbitration Act amongst non-signatories. He contends that the arbitration clause is enforceable under the doctrine of direct-benefits estoppel because Smith has (1) "enforced the will" and brought claims against Ali "for failing to comply with the will" and (2) "received appointee fees."

**I. Standard of Review and Legal Principles**

Ali, as the party seeking to compel arbitration, has the burden to show the existence of (1) a valid arbitration agreement and (2) a dispute within the scope of the agreement. *See**Rachal v. Reitz* , 403 S.W.3d 840, 843 (Tex. 2013). We review de novo whether an arbitration agreement is enforceable. *Id.* No presumption in favor of arbitration arises until the party seeking to compel arbitration proves that a valid arbitration agreement exists. *J.M. Davidson, Inc. v. Webster* , 128 S.W.3d 223, 227 (Tex. 2003). Whether an arbitration agreement is binding on a non-signatory implicates the issue of whether there is a valid arbitration agreement. *See**ENGlobal U.S., Inc. v. Gatlin* , 449 S.W.3d 269, 274 (Tex. App.-Beaumont 2014, no pet.) (citing *In re Weekley Homes, L.P.* , 180 S.W.3d 127, 130 (Tex. 2005) ); *see also**Rachal* , 403 S.W.3d at 849-50 (determining first whether the arbitration provision was enforceable against a non-signatory, and then *760whether the dispute was within the scope of the agreement).

The language of the Texas Arbitration Act indicates a legislative intent to enforce arbitration provisions in "agreements." *Rachal* , 403 S.W.3d at 845. An agreement is a manifestation of mutual assent by two or more persons. *Id.* "Typically, a party manifests its asset by signing an agreement." *Id.* ; *see also**In re Rubiola* , 334 S.W.3d 220, 224 (Tex. 2011) (noting that generally "parties must sign arbitration agreements before being bound by them").1 Ali and Smith agree that they are not signatories to the will.

But the Texas Supreme Court has "found assent by nonsignatories to arbitration provisions when a party has obtained or is seeking substantial benefits under an agreement under the doctrine of direct benefits estoppel." *Rachal* , 403 S.W.3d at 845-46. *See generally**Jody James Farms, JV v. Altman Grp.* , 547 S.W.3d 624, 632-33 (Tex. 2018) (reciting various theories for non-signatories to be bound by arbitration agreements). This doctrine precludes a plaintiff from seeking to hold a defendant liable based on the terms of an agreement that contains an arbitration provision while simultaneously asserting the provision lacks force because the plaintiff or defendant is a non-signatory. *See**Jody James Farms* , 547 S.W.3d at 37 (defendant non-signatory); *see also**In re Weekley Homes* , 180 S.W.3d at 131-32 (plaintiff non-signatory). "When a claim depends on the contract's existence and cannot stand independently-that is, the alleged liability arises solely from the contract or must be determined by reference to it-equity prevents a person from avoiding the arbitration clause that was part of that agreement." *Jody James Farms* , 547 S.W.3d at 637 (footnote and quotation omitted). On the other hand, "when the substance of the claim arises from general obligations imposed by state law, including statutes, torts and other common law duties, or federal law, direct-benefits estoppel is not implicated even if the claim refers to or relates to the contract or would not have arisen but for the contract's existence." *Id.* (quotation omitted).

Additionally, a non-signatory may be compelled to arbitrate if they deliberately seek or obtain substantial benefits from the contract by a means other than the lawsuit itself. *See**In re Weekley Homes* , 180 S.W.3d at 132 ; *see also**D.R. Horton-Emerald, Ltd. v. Mitchell* , No. 01-17-00426-CV, 2018 WL 542403, at *8 (Tex. App.-Houston [1st Dist.] Jan. 25, 2018, no pet.) (mem. op.) (referring to this principle as the "second avenue" for binding a non-signatory to an arbitration agreement through direct-benefits estoppel). This analysis focuses on the non-signatory's "conduct during the performance of the contract." *In re Weekley Homes* , 180 S.W.3d at 132-35 (applying direct-benefits estoppel to a non-signatory because, although her personal injury claim was not based on the contract, she consistently and knowingly exercised other rights emanating from the contract). This doctrine will not apply if the benefits are either insubstantial or indirect. *Id.* at 134.

**II. Application of Direct-Benefits Estoppel to Smith**

The parties do not cite any Texas case addressing arbitration in the context of administering a will.2 The most instructive *761case from the Texas Supreme Court is *Rachal v. Reitz* , in which direct-benefits estoppel applied to a beneficiary of a trust who sued the trustee. *See*403 S.W.3d at 847-48. The court held that a non-signatory "who attempts to enforce rights that would not exist without the trust manifests her assent to the trust's arbitration clause." *Id.* at 847.

In particular, the *Rachal* court considered the fact that the beneficiary did not disclaim an interest in the trust and that he claimed he was entitled to profits that would accrue to the trust estate. *Id.* The *Rachal* court looked further to the beneficiary's allegations in the lawsuit. *See id.* The beneficiary claimed that the trustee had "materially violated the terms of the Trust and his fiduciary duty by failing to account to the beneficiary and ... ha[d] materially violated th[e] terms of the Trust by his conversion of the Trust assets which has resulted in material financial loss to the Trust." *Id.* (omission in original). The court held that the beneficiary accepted the benefits of the trust and sued to enforce the terms of the trust; thus, he accepted the terms and validity of the trust, including the arbitration clause. *See id.* The non-signatory beneficiary was compelled to arbitrate under the theory of direct-benefits estoppel. *See**id.* at 842.

In this case, however, Smith contends that her claims against Ali derive from statutes and common law, irrespective of the will. And Smith contends that, to the extent her claims theoretically could be determined by reference to the will, Ali failed to meet his burden to prove direct-benefits estoppel. We agree with Smith.

As noted above, Smith alleges in the petition that Ali (1) "Failed to responsibly handle the finances of the estate"; (2) "Converted assets of the Estate to his own personal use"; and (3) "Used estate funds in violation and dereliction of his fiduciary duties." Unlike the beneficiary in *Rachal* who alleged violations of the trust terms, Smith does not allege in the petition that Ali violated any terms of the will. Rather, Smith contends that her claims are based on common law and statutory provisions such as Sections 351.001 and 351.101 of the Estates Code :

> The rights, powers, and duties of executors and administrators are governed by common law principles to the extent that those principles do not conflict with the statutes of this state.

Tex. Estates Code § 351.001.

> An executor or administrator of an estate shall take care of estate property as a prudent person would take of that person's own property....

*762*Id.* § 351.101. An executor such as Ali also has a statutory duty to deliver the property of the estate to a successor representative such as Smith. *See id.* § 351.102(b). And, Smith alleges in the petition that this action was brought pursuant to Section 361.153, which provides that a successor representative is "entitled to any order or remedy that the court has the power to give to enforce the delivery of the estate property" to the successor representative. *See id.* § 361.153(b); *see also id.* § 361.153(c) (granting successor representative the power to make himself or herself a party to a suit prosecuted against the successor's predecessor and to settle with the predecessor).

The fiduciary duty that an executor or administrator owes to the estate is derived from the statutes and common law. *See**Mohseni v. Hartman* , 363 S.W.3d 652, 656-57 (Tex. App.-Houston [1st Dist.] 2011, no pet.) (citing predecessor statute); *see also**Humane Soc'y of Austin & Travis Cty. v. Austin Nat'l Bank* , 531 S.W.2d 574, 577 (Tex. 1975) ("As trustee of the property of the estate, the executor is subject to the high fiduciary standards applicable to all trustees."). As the Texas Supreme Court explained when it rejected the defendant's assertion of direct-benefits estoppel in *Jody James Farms* , "A fiduciary duty generally arises from the relationship of the parties and not from the contract." 547 S.W.3d at 638 (holding that direct-benefits estoppel did not apply to breach of fiduciary duty claim brought by an insured against an insurance agent when the insurance policy contained an arbitration clause because, although the claim referred to the insurance policy, liability was not determined by reference to the policy)

The plain language of the statutes impose duties on both executors and administrators, but executors and administrators are not the same. An executor is named in a will, while an administrator with will annexed is not. The source of the executor's power to act is the will. The source of an administrator's power to act is the statutes and the court. *See**Loewenstein v. Watts* , 119 S.W.2d 176, 184-85 (Tex. Civ. App.-El Paso 1938) (op. on reh'g) (reasoning that an administrator with will annexed does not have the powers conferred upon an independent executor named in the will, and that administrators do not resort to the will for the source of their power to act, but "they, being creatures of the statutes, have no powers except those conferred by statutes"), *aff'd* , 134 Tex. 660, 137 S.W.2d 2 (1940) ; *see also**Frisby v. Withers* , 61 Tex. 134, 138 (Tex. 1884) (noting that an executor may have discretionary powers under a will that are personal to the named executor, which cannot be exercised by a successor administrator with will annexed).

Nothing in Smith's petition indicates that Ali's liability need be determined by reference to the will, even though he would not have been an executor "but for" the will. The substance of the claims arise from general duties imposed by statutes and the common law. *See**Jody James Farms* , 547 S.W.3d at 637 ; *see also**Mohseni* , 363 S.W.3d at 656-57. Smith has not alleged that Ali violated any terms of the will, so this theory of direct-benefits estoppel is inapplicable. *Cf.**Rachal* , 403 S.W.3d at 847-48 (direct-benefits estoppel applied to fiduciary duty claim because the non-signatory alleged violations of the terms of the trust).

Furthermore, if Smith's petition is unclear about whether Ali's liability will be determined by reference to the will, the trial court did not err by concluding that Ali failed to meet his burden to show the existence of an arbitration agreement that is enforceable against Smith. *See**763*D.R. Horton-Emerald, Ltd. v. Mitchell* , No. 01-17-00426-CV, 2018 WL 542403, at *6-8 (Tex. App.-Houston [1st Dist.] Jan. 25, 2018, no pet.) (mem. op.) (holding that the defendant failed to prove arbitrability based on direct-benefits estoppel when the plaintiffs' petition did not specify a particular cause of action, and the defendant did not file special exceptions to request greater specificity or otherwise show that the plaintiffs' construction-defect claim relied on a duty found in the building contract); *ENGlobal U.S., Inc. v. Gatlin* , 449 S.W.3d 269, 277-78 (Tex. App.-Beaumont 2014, no pet.) (holding that a the defendant failed to prove arbitrability based on direct-benefits estoppel when the plaintiff's premises liability claim against the defendant depended on proof that the defendant controlled the premises, and the defendant claimed that the plaintiff's proof of control was based on a contract containing an arbitration provision; but the petition did not allege that control was based on the contract rather than actual control, and the defendant did not file special exceptions to request greater specificity); *Glassell Producing Co. v. Jared Res., Ltd.* , 422 S.W.3d 68, 83 & n.13 (Tex. App.-Texarkana 2014, no pet.) (holding that the defendants did not prove arbitrability based on direct-benefits estoppel for various claims sounding in tort and contract when the plaintiff's pleadings were vague, the source of the obligations for the claims was not clear, and the defendants failed to file special exceptions to request greater specificity).

Under the second avenue for proving direct-benefits estoppel, Ali contends that Smith has obtained a benefit from the will by collecting "appointee fees" from the estate. Smith contends that she was entitled to the fees by statute, not the will. *See* Tex. Estates Code § 352.051 (entitling a "personal representative" to necessary and reasonable expenses and attorney's fees). We agree with Smith.

The trial court's order authorizing Smith to collect appointee fees does not state that Smith collected a benefit under the will. And, the authorizing statute does not make a distinction based on the existence of a will. *See id.* ; *see also id.* § 22.031(a) (defining "personal representative" as including "(1) an executor and independent executor; (2) an administrator, independent administrator, and temporary administrator; and (3) a successor to an executor or administrator listed in Subdivision (1) or (2).").

Because the trial court awarded fees and expenses to Smith without reference to the will, Ali has not shown that Smith deliberately sought or obtained substantial benefits from the will by a means other than the lawsuit. *See**In re Weekley Homes* , 180 S.W.3d at 132.

Ali's second issue is overruled.3

**Conclusion**

Having overruled Ali's dispositive issue, we affirm the trial court's order denying Ali's motion to compel arbitration.

( Jamison, J., dissenting).

*764**DISSENTING OPINION**

Martha Hill Jamison, Justice

***Smith is a party to the arbitration provision.***

It is self-evident that neither Ali nor Smith physically signed Sultan's will at the time it was executed. However, it can hardly be said that they are strangers to the will. Their acceptance of appointments to serve as executors of the will (and all its provisions) constitutes the assent required to form an enforceable agreement to arbitrate under the Texas Arbitration Act. *See**Rachal v. Reitz* , 403 S.W.3d 840, 841 (Tex. 2013). Texas jurisprudence regarding non-signatories to an arbitration agreement, therefore, should not be applied to this dispute.1 Because the majority has done so, I respectfully dissent.

In his fourth issue, which is dispositive, Ali argues that the trial court erred in denying his motion to compel arbitration because the arbitration provision is valid.2 I agree. There is nothing in the record to suggest that the arbitration provision is unconscionable or was the result of undue influence, fraud, or duress. Smith argues only that she is not a party to the provision.

As noted by the majority, the arbitration provision in Sultan's will states:

> If a dispute arises between or among any of the beneficiaries of my estate, the beneficiaries of a trust created under my Will, the **Executor** of my estate, or the Trustee of a trust created hereunder, **or any combination thereof** , such dispute shall be resolved by submitting the dispute to binding arbitration. It is my desire that **all disputes between such parties** be resolved amicably and without the necessity of litigation.

(Emphasis added). As the majority mentions, Ali argues that Sultan intended for persons such as Smith and himself to be bound by the arbitration provision.

Both parties to this dispute are or have functioned as executors of Sultan's estate, although Smith's title, successor administrator with will annexed, is a bit different. *See* Tex. Est. Code § 306.002. The term "Executor" is not a defined term in Sultan's will, and certainly is not defined to exclude Smith. Further, article VI.F. of the will states, "[U]nless another meaning is clearly indicated or required by context or circumstances, the term 'Executor' ... shall also mean and include ... successors."

Smith concedes that "it would be much more likely" that she would have to arbitrate if she were a successor executor specifically named in the will, citing *In re Rubiola* , 334 S.W.3d 220, 224 (Tex. 2011). In *Rubiola* , a non-signatory moved to compel a signatory to arbitration. The non-signatory was held to be included in the definition of "party" in the arbitration agreement and, thus, permitted to compel arbitration. The non-signatory was not specifically named in the agreement. Here, it is disingenuous for Smith to maintain that, though she carries out all the responsibilities of an executor (albeit with court supervision), she is not an executor-or a successor to an executor-for the purpose *765of the arbitration provision. "Who is actually bound by an arbitration agreement is a function of the intent of the parties, as expressed in the terms of the agreement." *Bridas S.A.P.I.C. v. Gov't of Turkm.* , 345 F.3d 347, 355 (5th Cir. 2003) ; *see also**Sherer v. Green Tree Servicing LLC* , 548 F.3d 379, 382 (5th Cir. 2008) (holding that equitable estoppel need not be applied to determine whether party identified in the agreement should be compelled to arbitrate). The arbitration provision clearly tells us who the parties are. Smith is one.

Smith agreed to her appointment, which was to carry out Sultan's clearly expressed intent in his will, including the intention for disputes to be arbitrated. As Smith's counsel stated in oral argument, "[The administrator] does not get to re-write the will." Exactly.

***Sultan intended this dispute to be resolved pursuant to the arbitration provision.***

The cardinal rule of will construction is to ascertain the testator's intent and to enforce that intent to the extent allowed by law. *Knopf v. Gray* , 545 S.W.3d 542, 545 (Tex. 2018). The guiding principle for courts in will-construction disputes is to discern and give effect to the testator's intent as expressed in the will's four corners. *See**Hysaw v. Dawkins* , 483 S.W.3d 1, 4 (Tex. 2016). Sultan clearly expressed his intent that disputes arising under the will between those acting as executors (which, reading the will as a whole, clearly includes predecessor executors and successor executors, despite their actual titles) be handled in arbitration proceedings. *Compare* Tex. Est. Code § 305.051 and § 305.052 (providing practically identical forms of oath for executor and administrator with will annexed).

We know from the text of his will that Sultan wanted "all disputes" to be "resolved amicably and without the necessity of litigation."

***Even as an administrator with will annexed, Smith must comply with Sultan's intent.***

Smith does not argue that Sultan did not express an intent to arbitrate this dispute, but argues that, as a successor administrator with will annexed, she does not have to follow any of the provisions of the will other than its distributive provisions, citing *Langley v. Harris* , 23 Tex. 564 (Tex. 1859). Smith argues that the trial court that appointed her is free to disregard the provisions in the will: "whether [I have] to follow any other provisions in the will is completely up to the probate court."

However, this is not the holding of *Langley* , in which the supreme court discussed the inability of an administrator with will annexed that succeeded an independent executor to act "independently." The court did not distinguish between distributive provisions of the will (which were the subject of that case) and other provisions. It held that the "right to obey the will" including all its provisions, is derived from the court, to whom the administrator must account. In other words, Smith cannot act absent the court's appointment and approval for certain actions. *Langley* does not permit the trial court to disregard the testator's clearly expressed intent.

Smith also cites *Frisby v. Withers* , 61 Tex. 134 (Tex. 1884), for the proposition that her appointment as administrator with will annexed did not carry with it the right to exercise the "discretionary powers" conferred alone upon the executors named in the will. Notwithstanding its dicta, the *Frisby* court affirmed a transfer by deed by a successor administrator with will annexed that was not authorized by a court order, a power reserved for independent executors. There is nothing in the provision "such dispute *shall* be resolved *766by submitting the dispute to binding arbitration" that indicates it is discretionary (emphasis added).3 Here, Sultan did not confer the responsibility to arbitrate disputes solely upon those carrying the title of executor, but compelled successors as well. Smith is not prevented from carrying out Sultan's intent in that regard.

Smith argues that if there is no named executor available-begging the question of why all the other family members named in Sultan's will were found by the trial court to be unsuitable-*all* the provisions in the will relating to independent executors and how they must administer the estate are effectively nullified, citing *In Re Grant's Estate,*53 S.W. 372 (Tex. 1899), and other cases. However, the *Grant* court was dealing with the conundrum created in the statute in effect at the time that did not give the trial court the authority to appoint an administrator when the named independent executors were unable to serve. That issue has been resolved in the current Estates Code in sections 304.001 and 361.152, among other provisions.

The cases cited by Smith stand for the proposition that provisions in a will for independent administration of an estate by its executors will not permit a successor administrator with will annexed to perform her duties independently of the trial court's supervision. However, the cases do not stand for the proposition that the successor, with the approval of the trial court, may disregard the expressed intent of the testator.4

Smith is required to arbitrate her claims. To the extent it was convinced otherwise, the trial court abused its discretion.

***An arbitration proceeding does not deprive the probate court of its ability to supervise a dependent administration.***

Smith argues as a matter of public policy that the trial court would be deprived of its ability to supervise the administration of Sultan's estate if the arbitration provision were honored. *See* Tex. Est. Code § 351.352 ("[P]robate court shall use reasonable diligence to see that [Smith] perform[s] [her] duties."). However, the trial court retains its ability to consider a motion to compel arbitration and a motion to confirm the arbitration award, among others, therefore discharging its responsibility.

***Claims against Ali as predecessor executor are within the scope of the arbitration provision.***

Smith also argues that her initial claims, against Ali for a declaratory judgment, arise not from the will but from the Estates Code. *See* Tex. Est. Code § 351.153 (authorizing successor executor or administrator to sue predecessor).5 The will however, provides that

> Each Executor ... shall have ... all powers ... conferred by statute or common law ... except for any instance in which such power ... may conflict with the express provisions of this Will, in which case the express provision of this Will shall control.

*767Smith invoked the will in her original petition. Whether or not Smith would have standing to sue Ali under the Estates Code without also invoking Sultan's will, and whether or not Ali would have liability as a fiduciary to the estate under the code without also invoking the will, the claim is nevertheless a "dispute arising" under the terms of the will.

I would sustain Ali's dispositive issue, reverse the trial court and remand with order to grant the motion to compel arbitration.

1

We refer to cases concerning the Federal Arbitration Act in this case involving the Texas Arbitration Act because state law governs whether a litigant has agreed to arbitrate. *See**In re Weekley Homes, L.P.* , 180 S.W.3d 127, 130 (Tex. 2005).

2

Smith contends that due to the lack of Texas authority, it is an "unsettled question of whether arbitration should be applied in the context of a will." We assume without deciding that arbitration clauses within wills are generally enforceable, and we decide only the narrower issue of whether Ali has proven arbitrability as to a non-signatory administrator under a theory of direct-benefits estoppel. Despite the dearth of authority, the inclusion of an arbitration clause in a will is nothing new. *See* George Washington, *George Washington's Last Will and Testament* (July 9, 1799), *in* 4 The Papers of George Washington, Retirement Series, 20 April 1799-13 December 1799, at 479-511 (W. W. Abbot ed., 1999) ("My Will and direction expressly is, that all disputes (if unhappily any should arise) shall be decided by three impartial and intelligent men, known for their probity and good understanding; two to be chosen by the disputants-each having the choice of one-and the third by those two. Which three men thus chosen, shall, unfettered by Law, or legal constructions, declare their sense of the Testators intention; and such decision is, to all intents and purposes to be as binding on the Parties as if it had been given in the Supreme Court of the United States."), *available at* http://founders.archives.gov/documents/Washington/06-04-02-0404-0001.

3

In his reply brief on appeal and at oral argument, Ali suggested that the administrator's taking of the oath under Section 305.051 of the Estates Code showed assent or amounted to "ratification" of the will. *See* Tex. Estates Code § 305.051. This argument was not presented to the trial court and is not preserved. *See**Santander Consumer USA, Inc. v. Mata* , No. 03-14-00782-CV, 2017 WL 1208767, at *3 (Tex. App.-Austin Mar. 29, 2017, no pet.) (mem. op.) (party seeking to compel arbitration failed to preserve error from trial court's denial of motion to compel when argument on appeal did not comport with argument to the trial court); *see also* Tex. R. App. 33.1; *Bruce v. Cauthen* , 515 S.W.3d 495, 511 (Tex. App.-Houston [14th Dist.] 2017, pet. denied).

1

There also is no need to analyze direct benefits estoppel.

2

Under the Texas Arbitration Act, a party seeking to compel arbitration must establish the existence of a valid, enforceable arbitration agreement and that the claims asserted fall within the scope of that agreement. *TMI, Inc. v. Brooks* , 225 S.W.3d 783, 791 (Tex. App.-Houston [14th Dist.] 2007, pet. denied). Here, neither party has argued that the claims asserted in Smith's petition against Ali are not within the scope of the arbitration provision. Smith claims that the provision is not valid because she is not a party to it.

3

The distinction between discretionary and mandatory powers is a false argument, as the courts have spoken only to the power to act, not the power to pick and choose what actions to take.

4

Likewise, the case cited by the majority makes the same holding. *See**Loewenstein v. Watts* , 119 S.W.2d 176, 184-85 (Tex. App.-El Paso 1938) (op. on reh'g) (reversing holding in original opinion that administrators with will annexed might exercise powers of independent executors), *aff'd* , 134 Tex. 660, 137 S.W.2d 2 (1940).

5

It is unclear whether Smith intended this argument to be analyzed only if direct benefits estoppel is applied.