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In The

Court of Appeals

Ninth District of Texas at Beaumont

___________________

NO. 09-17-00248-CV

___________________

THE SINCLAIR GROUP, LTD., H.L. SINCLAIR 

AND WHITNEY FOX, Appellants

V.

HENRI HAGGBLOM, Appellee 

__________________________________________________________________

On Appeal from the 284th District Court

Montgomery County, Texas

Trial Cause No. 17-04-04582-CV

__________________________________________________________________

OPINION

In this interlocutory appeal, The Sinclair Group, Limited, H.L. Sinclair and 

Whitney Fox (collectively, Sinclair) appeal from an order denying their joint motion 

to compel arbitration of their claims, which relate to their dispute with Henri 

Haggblom, an individual who was employed as the manager of The Sinclair Group, 

Limited (The Sinclair Group) and the Sinclair Group Texas, LLC (the LLC). See
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Tex. Civ. Prac. & Rem. Code Ann. § 171.098(a)(1) (West 2011) (authorizing 

interlocutory appeals from rulings on applications to compel arbitration subject to 

the Texas Arbitration Act). The claims Sinclair asked the trial court to refer to 

arbitration concerned primarily whether the appraiser who was employed by the 

parties to evaluate the fair market value of Haggblom’s membership interest in The 

Sinclair Group followed the method of appraisal set out in the written agreements

that he had with The Sinclair Group and the LLC. The record reflects that the written 

agreements relevant to Haggblom’s employment included arbitration provisions, 

which required the parties to arbitrate “[a]ny and all disputes, controversies, or 

claims arising out of or relating to this Agreement, including without limitation, 

claims based on contract, tort, or statute[.]”

We hold the trial court erred by denying Sinclair’s motion to compel 

arbitration regarding the parties’ dispute. Accordingly, we reverse the trial court’s 

order and remand the cause to the trial court, with instructions ordering the parties 

to resolve through arbitration their dispute over whether the appraiser followed the 

method of appraisal that is required in the parties’ written agreements, which 

specifically addressed the method to be used in valuing a limited partner’s 

membership interest in The Sinclair Group.
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Background

Haggblom signed a “Company Agreement” when he began employment to be 

one of two managers of the LLC, which is the general partner of The Sinclair Group.

The Company Agreement includes a provision restricting the rights of a member 

owning an interest in The Sinclair Group from disposing of that interest through a 

method other than the one that is provided under the Company Agreement. Under 

the Company Agreement, The Sinclair Group had a five-year period from the date 

Haggblom signed the agreement to purchase the interest of any member with an 

ownership interest in The Sinclair Group who no longer worked there. The Company 

Agreement included a provision containing a formula to be used to calculate the 

value of a limited partner’s interest in The Sinclair Group. The Company Agreement

required that the parties select an “accredited Business Valuator” (appraiser), and 

required the appraiser to then calculate the fair market value of the limited partner’s 

interest in The Sinclair Group by using a specific formula that included criteria 

allowing the appraiser to consider certain matters but preventing the appraiser from 

considering others. The Company Agreement includes an arbitration provision, 

which provides that the parties shall arbitrate “[a]ny and all disputes, controversies, 

or claims arising out of or relating to this Agreement, including without limitation, 

claims based on contract, tort, or statute[.]”
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Approximately eight months after signing the Company Agreement, 

Haggblom signed an “Employment Agreement” with The Sinclair Group. Under the 

Employment Agreement, Haggblom acquired a “5% Partnership Interest” in The 

Sinclair Group. The Employment Agreement reflects that Haggblom was being 

employed to manage the business of the LLC. The Employment Agreement also has 

an arbitration provision that is identical to the one in the Company Agreement.

In 2015, Sinclair terminated Haggblom’s contracts. At that time, The Sinclair 

Group exercised its right to purchase Haggblom’s partnership interest in The Sinclair 

Group. The record that was before the trial court when it ruled on Sinclair’s motion 

to compel arbitration shows that after Haggblom was terminated, the parties retained 

a consulting firm to appraise “the fair market value” of Haggblom’s five percent 

limited partnership interest in The Sinclair Group, as of December 31, 2015. In April 

2016, the appraiser provided the parties with a draft of his appraisal on Haggblom’s 

partnership interest in The Sinclair Group, which placed a fair market value on 

Haggblom’s interest at an amount exceeding $1,000,000. 

In June 2016, Sinclairsent the appraiser’s consulting firm a letter complaining 

the appraiser had failed to follow “the agreements of Sinclair Group and Mr. 

Haggblom relative to [valuing Haggblom’s interest].” Sinclair demanded that the 

consulting firm “withdraw from this engagement without issuing any further draft 
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reports or opinions or any final reports or opinions.” The record does not show that 

the appraiser ever finalized his April 2016 draft report or issued a final report. 

In April 2017, Haggblom sued Sinclair in Montgomery County, Texas,

seeking to recover a judgment against Sinclair based on the value of his interest as 

determined by the appraiser in his April 2016 draft report. In the suit, Haggblom 

asked the trial court to confirm the appraiser’s determination and render a judgment 

against Sinclair based on the opinion regarding the value expressed by the appraiser. 

Haggblom’s petition alleges the appraiser’s opinion regarding value was final 

because the Company Agreement states that the appraiser’s determination “shall be 

binding upon the parties.” Haggblom also asked the trial court to declare that 

Sinclair’s complaints about the appraiser’s method was not arbitrable and that the 

appraiser’s “award” was final. 

In May 2017, when Sinclair responded to Haggblom’s suit, it filed a motion 

to compel arbitration. Additionally, Sinclair asked the trial court to stay all judicial 

proceedings, pending the arbitration of its claim alleging the appraiser had not 

followed the method of appraisal required by the parties’ written agreements.

Sinclair’s motion to compel arbitration alleges that the appraiser the parties selected 

to appraise the value of Haggblom’s partnership interest “failed to follow the 

instructions contained in the controlling agreements.” According to Sinclair, its 
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dispute regarding whether the appraiser followed the correct method when he 

appraised Haggblom’s partnership interest is an arbitrable claim, given the broad

scope of the arbitration agreements in the Company Agreement and the Employment 

Agreement.

In early June 2017, Haggblom filed his response to Sinclair’s motion to 

compel arbitration. In his response, Haggblom argued that his written agreements

with Sinclair provide “for a separate, binding mechanism by which to determine the 

value of [his] interest in the Sinclair Group[,]” and he suggested the “parties intended 

and agreed to except the valuation process from arbitration.”

After conducting a non-evidentiary hearing on Sinclair’s motion, the trial 

court took the case under advisement. Approximately one week later, the court 

denied Sinclair’s motion. The trial court did not explain in the hearing or in its order 

the basis for its ruling. Subsequently, Sinclair pursued an interlocutory appeal and 

seeks an order to compel the parties to arbitrate their dispute.

Standard of Review

Under Texas law, a written agreement to arbitrate is valid and enforceable if 

an arbitration agreement exists and the claims a party seeks to have arbitrated are 

claims that fall within the scope of parties’ arbitration agreement. Tex. Civ. Prac. & 

Rem. Code Ann. §§ 171.001, 171.021 (West 2011). “To determine whether a party’s 
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claims fall within an arbitration agreement’s scope, we focus on the complaint’s 

factual allegations rather than the legal causes of action asserted.” In re FirstMerit 

Bank, N.A., 52 S.W.3d 749, 754 (Tex. 2001) (orig. proceeding). Because the public 

policy of the State strongly favors arbitration, a court should not deny a request to 

order the parties to arbitrate when a valid agreement to arbitrate exists unless the 

arbitration clause is not susceptible to being interpreted in a manner that would 

require the parties to arbitrate their dispute. See Williams Indus., Inc. v. Earth Dev. 

Sys. Corp., 110 S.W.3d 131, 137 (Tex. App.—Houston [1st Dist.] 2003, no pet.) 

(applying the Texas Arbitration Act).

A party seeking to compel arbitration must show that “(1) there is a valid 

arbitration agreement and (2) the claims raised fall within that agreement’s scope.”

Granite Re Inc. v. Jay Mills Contr. Inc, No. 02-14-00357-CV, 2015 Tex. App. 

LEXIS 4182, *7 (Tex. App.—Fort Worth 2015, no. pet.) (mem. op.) (citing In re 

Kellogg, Brown & Root, Inc., 166 S.W.3d 732, 737 (Tex. 2005) (orig. proceeding)); 

see also Valero Energy Corp. v. Teco Pipeline Co., 2 S.W.3d 576, 581 (Tex. App.—

Houston [14th Dist.] 1999, no pet.); Tex. Civ. Prac. & Rem. Code Ann. § 171.001(a).

Once the party moving for arbitration establishes that a valid arbitration agreement 

exists, the burden of showing that the dispute is one that is not arbitrable falls on the 

party opposed to referring the matter to arbitration. Prudential Sec. Inc. v. Marshall, 
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909 S.W.2d 896, 900 (Tex. 1995) (orig. proceeding) (applying the Federal 

Arbitration Act); McReynolds v. Elston, 222 S.W.3d 731, 740 (Tex. App.—Houston 

[14th Dist.] 2007, orig. proceeding) (applying the Texas Arbitration Act). To 

determine whether the dispute at issue falls within the scope of arbitration, courts

are required to focus on the factsthat are alleged in the pleadings, not the legal causes 

of action that have been pleaded. McReynolds, 222 S.W.3d at 740. A strong 

presumption exists favoring arbitration, so courts are required to resolve doubts 

regarding arbitrability in favor of referring the dispute to arbitration. Ellis v. 

Schlimmer, 337 S.W.3d 860, 862 (Tex. 2011) (per curiam).

When reviewing a trial court’s decision on a motion to compel arbitration, the 

ruling is reviewed under a de novo standard. Lexington Ins. Co. v. Exxon Mobil 

Corp., No. 09-16-00357-CV, 2017 Tex. App. LEXIS 3819, *11 (Tex. App.—

Beaumont 2017, no pet.) (mem. op.) (citing Tex. Petrochemicals LP v. ISP Water 

Mgmt. Servs. LLC, 301 S.W.3d 879, 884 (Tex. App.—Beaumont 2009, no pet.)); 

McReynolds, 222 S.W.3d at 740.

Is Sinclair’s Claim Arbitrable?

In the trial court, Haggblom and Sinclair agreed the arbitration agreements

they signed were valid. Given the agreement that a valid arbitration agreement 

existed, the trial court was required to resolve “any doubts as to the agreement’s 
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scope, waiver, and other issues unrelated to [the arbitration agreement’s validity] in 

favor of arbitration.” Ellis, 337 S.W.3d at 862. And, where the disputed matter falls 

within the scope of the matters the parties agreed to arbitrate, a “‘court has no 

discretion but to compel arbitration and stay its own proceedings.’” Forest Oil Corp. 

v. McAllen, 268 S.W.3d 51, 56 (Tex. 2008) (quoting In re FirstMerit Bank, 52 

S.W.3d at 753-54) (explaining the process that is required to resolve an appeal 

involving a contract governed by the Texas Arbitration Act)).

With respect to the arbitration clauses in the written agreements before the 

trial court in this case, both agreements required the parties to arbitrate “[a]ny and 

all disputes, controversies, or claims arising out of or relating” to the Agreements.

Broad arbitration provisions, like the arbitration provisions before us in this appeal,

required the trial court to favor ordering the dispute, which concerns whether the 

appraiser followed the appraisal method in the agreements, into arbitration. See

Dewey v. Wegner, 138 S.W.3d 591, 602-603 & n.20 (Tex. App.—Houston [14th 

Dist.] 2004, orig. proceeding) (citing AutoNation USA Corp. v. Leroy, 105 S.W.3d 

190, 196 (Tex. App.—Houston [14th Dist.] 2003, no pet.)); see also In re Jim Walter 

Homes, Inc., 207 S.W.3d 888, 895 (Tex. App.—Houston [14th Dist.] 2006, orig.

proceeding).
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In Haggblom’s case, the heart of the parties’ dispute concerns whether the 

appraiser complied with the appraisal method established in the parties’ written 

agreements. The written agreements specify the criteria the parties expected the 

appraiser to use in appraising the value of a partner’s interest, and both Haggblom 

and Sinclair, as a matter of contract law, had the right to expect the appraiser to 

comply with the method the parties outlined in their agreements. Given the broad 

language in the arbitration agreements, the dispute falls clearly within the scope of 

the disputes the parties chose to arbitrate. 

In his brief, Haggblom suggests the appraiser’s opinion was final and that it 

could not be attacked for the reason Sinclair suggests. To support this argument, 

Haggblom relies on a provision in the appraisal provision that states the appraiser’s 

“determination of the [fair market value] . . . shall be binding upon the parties.” 

While the term “binding” indicates the parties intended the process to be one that 

could not be broken, thatsame expectation exists whenever a party enters into a legal 

agreement. While the parties to contracts generally always intend their agreements 

to be binding, such agreements may prove not to be binding on the parties for 

numerous reasons, including when one of the parties breaches a term that is material 

to the agreement. 
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In this case, the “binding” nature of the appraisal process presumed that the 

appraiser would follow the appraisal method imposed on the appraisal process by 

the parties’ written agreements. And, this is the matter in dispute, since Sinclair 

alleges that the appraiser failed to comply with the method established by the parties 

in their written agreements. Importantly, the language the parties chose to use in 

their arbitration agreements also contains no language that expressly excludes this 

type of dispute from the express requirement that all disputes be arbitrated. 

“Generally, if the facts alleged in a claim ‘touch matters’ that are covered by, 

have a ‘significant relationship’ to, are ‘inextricably enmeshed’ with, or are 

‘factually intertwined’ with the contract that contains the arbitration agreement, the 

claims are arbitrable.” Tex. Petrochemicals LP, 301 S.W.3d at 885 (citing In re Bath 

Junkie, 246 S.W.3d 356, 366 (Tex. App.—Beaumont 2008, orig. proceeding)).

While some tension exists between the “shall be binding” language that is in the 

appraisal provision and the “any and all disputes” language found in the arbitration 

agreements, Texas law requires that we resolve all doubts about whether a dispute 

is arbitrable in favor of requiring the parties to arbitrate their dispute. See Ellis, 337 

S.W.3d at 862.

Given the scope of the arbitration agreement, whether the appraiser followed 

the method called for by the parties’ written agreements is a dispute that must be 
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decided in arbitration. Depending on the arbitrator’s resolution of that dispute, 

Sinclair might ask the arbitrator to require an appraisal that employs the method of 

appraisal found in the parties’ written agreements. Should Haggblom prevail, he 

might ask the arbitrator to accept the draft report. Regardless of the arbitrator’s 

resolution of that dispute, the parties’ claims are arbitrable in light of the broad and 

inclusive language that Sinclair and Haggblom used in the arbitration provisions 

they chose to include in both their Employment and Company Agreements.

Conclusion

We conclude the trial court erred when it denied Sinclair’s motion to compel 

arbitration. See Hoskins v. Hoskins, 497 S.W.3d 490, 494 (Tex. 2016) (noting that 

Texas law favors arbitration); G.T. Leach Builders, LLC v. Sapphire V.P., LP, 458 

S.W.3d 502, 521 (Tex. 2015) (noting that both Texas and federal law recognize a 

strong presumption favoring the arbitration of disputes). Considering the broad 

scope of the language in the parties’ arbitration agreements, we conclude that the 

dispute over whether the appraiser failed to follow the appraisal method established 

by the parties in their written agreements is an arbitrable issue.

We reverse the trial court’s order denying Sinclair’s motion to compel 

arbitration, and we remand the cause to the trial court with instructions to render an 

order compelling Sinclair and Haggblom to arbitration to resolve their dispute about
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whether the appraiser failed to follow the appraisal method that the parties created 

under their written agreements.

REVERSED AND REMANDED.

_________________________

HOLLIS HORTON

Justice

Submitted on December 20, 2017

Opinion Delivered April 12, 2018

Before Kreger, Horton and Johnson, JJ.