Supreme Court of Texas

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No. 21-0028

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TotalEnergies E&P USA, Inc.,

Petitioner,

v.

MP Gulf of Mexico, LLC, 

Respondent

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On Petition for Review from the

Court of Appeals for the Twelfth District of Texas

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JUSTICE BUSBY, dissenting.

Contracting parties beware: According to the Supreme Court of 

Texas, if you agree to arbitrate a limited set of disputes under the Rules 

of the American Arbitration Association (AAA), you are stripping courts 

of power to decide whether a particular dispute falls outside the scope of 

that agreement. And you are agreeing in advance to whatever the AAA 

may choose to say in the future about the arbitrators’ power to decide 

that issue. 

No matter how clearly you attempt to restrict both what types of 

disputes will be arbitrated and when the AAA rules apply, courts will 

force you to arbitrate under the AAA rules without even considering 
2

those restrictions. Like glitter, the AAA rules cannot be constrained if 

the parties use them to any extent. Even if you say in a single sentence 

that certain scope requirements are substantive preconditions to 

arbitration, which shall be conducted under the AAA rules, an arbitrator 

will decide under the AAA rules whether your dispute meets those 

express preconditions. Because this surprising rule—which has evenly 

split courts nationwide—turns on its head the U.S. Supreme Court’s 

admonition that any contractual delegation of power to arbitrators to 

decide such “arbitrability” questions must be “clear and unmistakable,” 

I respectfully dissent.

Whether a party has given up the “right to a court’s decision about 

the merits of its dispute” in favor of private arbitration is a “matter of 

contract”: “a party can be forced to arbitrate only those issues it 

specifically has agreed to submit to arbitration.” First Options of Chi., 

Inc. v. Kaplan, 514 U.S. 938, 942-43, 945 (1995). Because arbitrators 

“derive their authority to resolve disputes” from the parties’ advance 

agreement, it is ordinarily for courts—not arbitrators—to decide 

whether a particular dispute falls within the scope of the parties’ 

agreement empowering the arbitrators. AT&T Techs. v. Commc’ns

Workers of Am., 475 U.S. 643, 648-49 (1986); see also BG Grp. PLC v. 

Republic of Argentina, 572 U.S. 25, 34 (2014). Any agreement to assign 

the decision of this so-called “arbitrability” question to the arbitrators 

themselves must be “clear and unmistakable” to avoid “forc[ing]

unwilling parties to arbitrate a matter they reasonably would have 

thought a judge . . . would decide.” First Options, 514 U.S. at 944-45; see 
3

id. (noting a party “might not focus upon . . . the significance of having 

arbitrators decide the scope of their own powers”).

When applying this legal framework to a particular contract, the 

words chosen by the parties should be the beginning and end of the 

inquiry. Unlike the Court, I begin by analyzing that article.

I.

Article 16.16 of the parties’ System Operating Agreement adopts 

a “Dispute Resolution Procedure.” It begins by providing that 

[a]ny dispute between the Parties concerning this 

Agreement (other than Claims by a third party under 

which a Party hereto is claiming indemnity, and such third 

party claim is in litigation) shall be resolved under the 

mediation and binding arbitration procedures of this 

Article 16.16. 

Thus, the parties begin by carving out certain disputes from the scope of 

their procedure, which has both mediation and arbitration components. 

As explained below, the arbitration component of the procedure further 

limits its own scope.

Article 16.16 goes on to say that the parties “will first attempt in 

good faith to resolve all disputes” through management-level 

negotiations. “If any party believes further negotiations are futile, such 

Party may initiate the mediation process by so notifying the other 

Parties to the dispute . . . in writing.” Those parties “shall then attempt 

in good faith to resolve the dispute by mediation” under the AAA’s 

“Commercial Rules.” “If the dispute has not been resolved pursuant to 

mediation within sixty (60) days after initiating the mediation process, 
4

the dispute shall be resolved through binding arbitration, as follows:

. . . .”

What follows is article 16.16.1, which is—or should be—at the 

heart of this case. That article provides:

If any dispute or controversy arises between the parties out 

of this Agreement, the alleged breach thereof, or any tort 

in connection therewith, or out of the refusal to perform the 

whole or any part thereof, and the Parties are unable to 

agree with respect to the matter or matters in dispute or 

controversy, the same shall be submitted to arbitration

. . . in accordance with the rules of the AAA and the 

provisions in this Article 16.16. (emphases added)

Viewed as a whole, the parties’ chosen words create a substantive 

condition that narrows the agreement to arbitrate—similar to what the 

Court calls a “limited arbitrability” clause: “If” certain conditions are 

met, including that the parties’ dispute falls within the agreed scope, 

then that dispute “shall be submitted to arbitration” under the AAA 

Rules and the provisions of the Agreement. In turn, AAA Commercial 

Rule 7(a) provided at the relevant time that an arbitrator “shall have 

the power to rule on his or her own jurisdiction, including any objections 

with respect to the existence, scope, or validity of the arbitration 

agreement or to the arbitrability of any claim or counterclaim.” AM. ARB.

ASS’N, Commercial Arbitration Rules and Mediation Procedures 13 

(2013).

The question before us is whether this language as a whole clearly

and unmistakably provides that an arbitrator, not a court, will decide 

whether the conditional “if” clause has been satisfied—in other words, 

decide whether the dispute “arises . . . out of this Agreement” and 

otherwise meets the agreement’s specified conditions. The answer is no 
5

because as a matter of text and logic, the “if” clause is a substantive 

condition precedent to arbitrators acquiring the power to decide 

anything at all. It is only “if” the specified conditions are met 

(antecedent) that the parties have agreed to allow arbitrators to decide 

their dispute (consequent), including any issues that may then arise 

regarding the arbitrators’ jurisdiction and any questions the parties 

may choose to submit to the arbitrators regarding the scope of the 

agreement. 

Respondent MP Gulf urges us to overlook this structure and 

compel arbitration without deciding ourselves whether the “if” clause 

has been satisfied. But in doing so, MP Gulf commits the logical error 

of using the consequent to determine the antecedent—that is, it puts the 

cart before the horse. 

Any other reading makes this agreement a self-contradictory 

muddle. As just discussed, the agreement’s plain text provides that a 

dispute shall be submitted to arbitration in accordance with the AAA 

rules only “if” that dispute is within the agreed scope. But if the Court 

is correct about what AAA Rule 7(a) means (which it is not as I explain 

in Part II.B.), then the agreement also says by incorporation that the 

arbitrators have the exclusive power to determine if a dispute is within 

the agreed scope. That reading of the rule is obviously inconsistent with 

the agreement’s directive that a disagreement about arbitrability needs 

to be resolved in favor of the parties’ dispute falling within the scope of 

the agreement to arbitrate before that dispute will even be submitted to 

arbitrators under the AAA rules. These conflicting signals about “who 

decides what” fail to satisfy the First Options test of clearly and 
6

unmistakably assigning questions of arbitrability to the arbitrator for 

decision.

The Court relegates to a footnote its thoughts about this central 

contract-interpretation question: did the parties agree to substitute 

arbitrators for courts as the decisionmakers regarding whether the “if” 

clause of this particular agreement has been satisfied? See ante at 42

n.30. In addition, the Court does not examine how other decisions have 

analyzed the effect of similar conditional language. Rather, its footnote 

speculates that certain decisions would have come out the same way if 

the carve-out agreements in those cases had been written more like the 

expressly conditional agreement here. See id. 

I disagree because the interpretive question as framed by the U.S. 

Supreme Court is whether the language chosen by the parties shows 

that they “clearly and unmistakably” intended to delegate arbitrability 

questions to the arbitrator. AT&T Techs., 475 U.S. at 649; see also First 

Options, 514 U.S. at 944. And their choice here to use expressly 

conditional language (“If XYZ, then arbitrate under the AAA rules”) 

rather than a limitation (“Arbitrate XYZ under the AAA rules”) or a 

carve-out (“Arbitrate all disputes except ABC under the AAA rules”) is 

an even clearer method of signaling that the parties did not intend to 

empower an arbitrator to decide under the AAA rules whether the 

conditions—XYZ—have been satisfied.

II.

Rather than focusing on the contract, the Court poses and 

answers a different set of questions informed by extensive taxonomies 

of cases that bear little relationship to the wording and structure of this 
7

particular agreement. Not only is exploring those questions 

unnecessary to our decision, it obscures that courts nationwide are 

actually quite closely divided on the very issue presented here: does an 

agreement to arbitrate fewer than “all” disputes under the AAA rules 

make arbitrators the sole decisionmakers regarding whether a 

particular dispute must be arbitrated? Moreover, the Court’s proposed 

answers conflict with decisions of the U.S. Supreme Court and our own 

federal circuit as explained below, and they knee-cap our Court’s recent 

precedent along the way.1 

Specifically, the Court begins by advising that an agreement to 

arbitrate “any and all disputes” in accordance with the AAA rules would 

establish a clear and unmistakable agreement to delegate arbitrability 

decisions to the arbitrator, and it explores how reams of cases bear on 

that conclusion. The Court’s conclusion is an interesting one, and it is 

significant given its impact on our other cases as just noted. I address 

one key aspect of this advisory conclusion in Part II.B. below: whether 

AAA Rule 7(a) is in fact an exclusive delegation of power to arbitrators 

to determine arbitrability. 

But assuming its correctness for the moment, the Court’s 

conclusion is also an unnecessary one that does not apply here because 

this particular agreement is not to arbitrate “any and all disputes.” 

1 See ante at 13 n.11 (recognizing the tension between its holding and 

our recent decision in Jody James Farms, JV v. Altman Group, Inc., 547 

S.W.3d 624, 633 (Tex. 2018), that incorporation of the AAA rules does not 

delegate to the arbitrator questions regarding the arbitrability of claims 

involving a non-signatory), 22 n.16 (limiting our recent decision in Robinson v. 

Home Owners Management Enterprises, Inc., 590 S.W.3d 518, 531 (Tex. 2019), 

regarding arbitration of class-wide claims).
8

Rather, the agreement contains both (in the Court’s terminology) a 

“carve-out” clause from the overall dispute-resolution procedure in 

Article 16.16 as well as a substantive precondition similar to a “limited 

arbitrability” clause in Article 16.16.1. I consider what other courts 

have said about the effect of such clauses next.

A.

The Court holds that its interpretation of Rule 7(a) as an 

exclusive delegation of power to arbitrators to determine arbitrability 

does not change when the scope of the arbitration clause chosen by the 

parties is narrower than “any and all possible disputes.” Ante at 31-32. 

This holding is incorrect and creates a split between our jurisprudence 

and that of the Fifth Circuit.

As the Court acknowledges earlier in its opinion (at 15), the Fifth 

Circuit held in Henry Schein (following a remand from the U.S. Supreme 

Court) that an agreement to AAA arbitration for some types of claims 

but not others “incorporates the AAA rules—and therefore delegates 

arbitrability [to the arbitrator]—for all disputes except those under the 

carve-out.” Archer & White Sales, Inc. v. Henry Schein, Inc., 935 F.3d 

274, 281 (5th Cir. 2019). Thus, the court had the power to determine 

whether the carve-out applied. Id. at 282.

The Second Circuit agrees and has explained the logic and 

contours of this position. “Where . . . the arbitration agreement is 

narrower, vague, or contains exclusionary language suggesting that the 

parties consented to arbitrate only a limited subset of disputes, 

incorporation of rules that empower an arbitrator to decide issues of 

arbitrability, standing alone, does not suffice to establish the requisite 
9

clear and unmistakable inference of intent to arbitrate arbitrability.” 

DDK Hotels, LLC v. Williams-Sonoma, Inc., 6 F.4th 308, 319 (2d Cir. 

2021). As the court observed, “whether the AAA rules, including Rule 

7(a), apply turns on the conditional premise that the dispute falls within 

the [scope of the agreement]. If it does not, then the AAA rules do not 

govern and no delegation of authority to the arbitrator to resolve 

questions of arbitrability arises.” Id. at 321. The Delaware and 

Mississippi Supreme Courts also agree, as do many of our Texas 

appellate courts.2 

I would join the Second and Fifth Circuits and the Delaware and 

Mississippi Supreme Courts in holding that a limited agreement to 

arbitrate under the AAA rules does not alone empower arbitrators to 

decide whether the dispute falls within the agreed limits.3 The Court 

rejects this position, agreeing instead with the Sixth, Ninth, and 

Eleventh Circuits and the Kentucky Supreme Court that when the 

parties agree to a carve-out arbitration clause and select the AAA rules 

(e.g., “Arbitrate all disputes except ABC under the AAA rules”), they 

2 See James & Jackson, LLC v. Willie Gary, LLC, 906 A.2d 76, 80-81 

(Del. 2006) (“Since this arbitration clause does not generally refer all 

controversies to arbitration, the federal majority rule does not apply, and 

something other than the incorporation of the AAA rules would be needed to 

establish that the parties intended to submit arbitrability questions to an 

arbitrator. There being no such clear and unmistakable evidence of intent, the 

trial court properly undertook the determination of substantive arbitrability.”);

Nethery v. CapitalSouth Partners Fund II, L.P., 257 So. 3d 270, 274-75 (Miss. 

2018); see also ante at 23 nn.19-20 (collecting cases from the Texas courts of 

appeals).

3 Cf. Jody James Farms, 547 S.W.3d at 633 (“The insurance policy 

directly incorporates the AAA rules only for these disputes, not for disputes 

between Jody James and unspecified third parties.” (emphasis added)).
10

delegate to the arbitrator the question whether the dispute falls within 

the carve-out. Ante at 35-40. 

But all of those cases are distinguishable because they involved a 

different kind of agreement: an arbitration clause with a carve-out. 

Their reasoning does not apply to an arbitration clause with express 

preconditions to arbitration under the AAA rules like the one we have 

here. For example, the Court explains that in a carve-out case, “the 

parties [have] agreed (by incorporating the AAA rules) that all disputes 

over arbitrability would be resolved by the arbitrators, and ‘the effect of 

the carve-out provision is to state that if an arbitrator determines that 

[a party has asserted a carved-out claim], then the arbitrator must refer 

that claim to a court if [the party] desires.” Ante at 37 (quoting Ally

Align Health, Inc. v. Signature Advantage, LLC, 574 S.W.3d 753, 758 

(Ky. 2019)).

In this case, however, the parties have not agreed that “all” 

disputes over arbitrability will be resolved by arbitrators. Thus, unlike 

in those cases, there is no conflation of “the two separate and distinct 

questions of (1) who decides what claims are arbitrable with (2) what 

claims are arbitrable.” Ally Align Health, 574 S.W.3d at 758. The 

parties here agreed that if certain express preconditions are met, 

including that the claim falls within a specified scope of what claims are 

arbitrable, the arbitrators are then empowered to decide that claim 

under the AAA rules “and the provisions in this Article.” Under the 

Article, that power to decide—including the power to decide what claims 

are arbitrable—only belongs to arbitrators “if” the substantive 

preconditions are met. The parties did not clearly and unmistakably 
11

delegate to arbitrators the power to decide whether the preconditions 

are met. 

As a matter of black-letter contract law, “[w]hen an arbitration 

agreement incorporates by reference outside rules, the specific 

provisions in the arbitration agreement take precedence and the 

arbitration rules are incorporated only to the extent that they do not 

conflict with the express provisions of the arbitration agreement.” 

Americo Life, Inc. v. Myer, 440 S.W.3d 18, 24 (Tex. 2014) (quotation 

marks omitted). Applying this principle does not “render the AAA’s 

jurisdictional rule [7(a)] superfluous,” Blanton v. Domino’s Pizza 

Franchising LLC, 962 F.3d 842, 847 (6th Cir. 2020), as the Sixth Circuit 

and its aligned courts have concluded. Instead, it recognizes that the 

agreement’s substantive preconditions on use of the AAA rules should 

take precedence over the application of particular rules. In cases where 

the preconditions are met, the arbitrators are empowered to use Rule 

7(a) to decide any questions of jurisdiction that the parties may raise 

during the arbitration.

The Court also contends that the U.S. Supreme Court’s decision 

in Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63 (2010), requires 

courts to distinguish between the scope of an agreement to arbitrate and 

a separate provision of the same contract that delegates the arbitrability 

question to arbitrators. See ante at 41-42. But it is far from apparent 

that an average contracting party would understand that sort of multilayered severability distinction—which the Court tries to illustrate by 

citing an article’s abstruse analogy to a hole in a doughnut hole, ante at 

45 n.31—with the clarity and unmistakability First Options requires. 
12

Moreover, an examination of Rent-A-Center reveals that it was 

addressing a far different contract and arbitration challenge than the 

one at issue here and in Henry Schein. The parties in Rent-A-Center

entered into a stand-alone agreement to arbitrate employment disputes. 

One provision in the agreement provided for arbitration of all disputes 

arising out of the plaintiff’s employment, while a separate provision 

provided that the arbitrator—and not any court—had exclusive 

authority to resolve any dispute relating to the applicability or 

enforceability of the agreement. 561 U.S. at 65. The agreement did not 

reference the AAA rules.

The plaintiff employee sued for employment discrimination and 

Rent-A-Center moved to compel arbitration. The employee argued that 

a court should determine whether enforcing the arbitration agreement 

would be unconscionable, but the Supreme Court disagreed. It observed 

there was no dispute that the delegation provision clearly and 

unmistakably provided the arbitrator with exclusive authority to decide 

whether the agreement was enforceable. See id. at 69 n.1. Nor was 

there any disagreement that the employee’s discrimination suit as well 

as his claim that the agreement was unconscionable were within the 

scope of the agreement’s broad promise to arbitrate all disputes arising 

out of his employment. 

Instead, the only question in dispute was whether the plaintiff’s 

claim of unconscionability challenged the validity of the contract as a 

whole or of the delegation provision specifically. Id. at 70-72. The 

Supreme Court concluded that the plaintiff was challenging the 

unconscionability of the contract and of particular procedural provisions 
13

regarding fee-splitting and discovery limits in arbitration. Id. at 72-75. 

It therefore treated the separate delegation and scope-of-arbitration 

provision as valid and enforced it, leaving the validity challenges for the 

arbitrator to decide. Id. at 72.

The routine severability analysis in Rent-A-Center does not shed 

any light on the proper decision in this case, which involves no validity 

challenges to all or any part of the agreement. Here, the agreement 

includes a single combined sentence that addresses the scope of the 

agreement to arbitrate, incorporates the AAA rules including Rule 7(a) 

regarding the arbitrator’s power to decide arbitrability, and uses 

expressly conditional language (absent in Rent-A-Center) to describe the 

relationship between the two. Although I agree with my colleagues in 

the majority that the scope of the arbitrator’s authority to decide 

questions of arbitrability can be a distinct inquiry from the scope of the 

agreement to arbitrate, the results of those separate analyses should 

nonetheless be identical when the phrase that incorporates the AAA 

rules is grammatically subject to the same textual limitations the 

parties expressed regarding their agreement to arbitrate. 

To the extent that reconciling the two analyses “might seem like 

a chicken-and-egg problem,” that tension “is resolved by application of 

the presumption favoring a judicial determination.” Jody James Farms, 

547 S.W.3d at 633. “After all, the basic objective in this area is not to 

resolve disputes in the quickest manner possible, no matter what the 

parties’ wishes . . . , but to ensure that commercial arbitration 

agreements, like other contracts, are enforced according to their terms.” 

First Options, 514 U.S. at 947 (quotation marks omitted).
14

Finally, unlike in Rent-A-Center, the parties here disagree about 

(1) whether their dispute falls within the scope of the promise to 

arbitrate, (2) whether the AAA rules come into play in deciding that 

scope issue given the conditional structure of the combined sentence, 

and (3) even if the AAA rules apply, whether the Rule 7(a) arbitrability 

provision—which (unlike the Rent-A-Center agreement) does not 

reference an exclusive delegation to the arbitrator—prevents courts 

from deciding the scope issue.

In summary, I conclude regarding the second issue that an 

affirmative answer to the first (scope) issue is a condition precedent to 

the application of the AAA rules under the particular language of this 

agreement, so that answer must be given by a court. As explained in 

Part II.B. below, I also conclude regarding the third issue that even if 

the AAA rules apply, Rule 7(a)’s delegation language is not exclusive 

and thus does not deprive courts of the power to address the scope issue. 

For either of those independent reasons (or both together), I would hold 

that the court of appeals erred by failing to address the first issue 

regarding scope before compelling arbitration, and I would reverse and 

remand for it to do so. 

B.

The Court’s holding that the AAA rules clearly and unmistakably 

delegate arbitrability decisions to arbitrators in place of courts is 

founded on its interpretation of Rule 7(a). It characterizes Rule 7(a)’s 

statement that the arbitrator “shall have the power to rule on” the 

arbitrability of a claim as “mandatory and exclusive language” that 

“clearly and unmistakably delegate[s] that decision exclusively to the 
15

arbitrator,” thereby depriving courts of the power to address it. Ante at 

28-29. That view is flatly contrary to federal law and U.S. Supreme 

Court precedent. 

As First Options explains, an arbitration clause can grant 

arbitrators at most “primary authority to decide whether a party has 

agreed to arbitrate.” 514 U.S. at 942 (emphasis added). Under the 

Federal Arbitration Act, courts still retain the ability to vacate an 

arbitration award “where the arbitrators exceeded their powers.” 

9 U.S.C. § 10(a)(4).4 Thus, as a matter of law, Rule 7(a) cannot mean 

what the Court says; the authority that the rule gives arbitrators to 

decide the scope of their own powers does not exclude courts from 

policing the limits on those powers drawn by the arbitration agreement’s 

unambiguous language. 

In addition, the AAA itself acknowledged Rule 7(a)’s nonexclusive nature in its September 2022 amendment. The rule now 

provides that “[t]he arbitrator shall have the power to rule on his or her 

own jurisdiction, including any objections with respect to the existence, 

scope, or validity of the arbitration agreement or to the arbitrability of 

any claim or counterclaim, without any need to refer such matters first 

to a court” (emphasis added). AM. ARB. ASS’N, Commercial Arbitration 

4 By way of illustration, Jody James Farms involved an appeal of the 

trial court’s final judgment denying Jody James’s motion to vacate an 

arbitration award and confirming the arbitration award against Jody James. 

547 S.W.3d at 630. In reviewing that determination, this Court did not 

approach the inquiry through the lens of whether the arbitrator had exceeded 

its powers under section 10(a)(4), instead identifying the relevant question as 

“whether a binding arbitration agreement exist[ed]” in the first place. Id. at 

633.
16

Rules and Mediation Procedures 14 (2022). Although the amendment is 

not applicable here, it confirms that the function of Rule 7(a) is to give 

arbitrators non-exclusive power to address any arbitrability issues that 

may arise during an arbitration, while not disturbing the court’s role as 

an available decisionmaker for arbitrability issues that may come before 

it in a motion to compel. By indicating that arbitrability matters can 

be—but need not be—referred to a court, the AAA shows its 

understanding that both courts and arbitrators have the power to decide 

arbitrability issues under its rules. 

The Court does not engage with this new language. But the 

Court’s reasoning depends on arbitrators having exclusive power to 

decide arbitrability, which suggests that its decision today will not apply 

to arbitrations governed by the new rule. 

The 2022 amendment recognizing that both courts and 

arbitrators have a role to play in deciding arbitrability questions also 

shows why the Florida Supreme Court’s recent decision on this issue is 

wrong. According to that court, “[t]he question of whether a claim is 

arbitrable must, by necessity, be determined before the commencement 

of arbitration”; thus, recognizing courts’ continued power to decide 

questions of arbitrability when the parties have incorporated the AAA 

rules would render Rule 7(a) meaningless. Airbnb, Inc. v. Doe, 336 

So. 3d 698, 705 (Fla. 2022) (emphasis added). Not so. 

Whether parties commence an arbitration by agreement or as a 

result of a court’s ruling on a motion to compel, arbitrators can and 

frequently do decide issues regarding their jurisdiction—including the 

arbitrability of a claim as permitted by Rule 7(a)—that arise in that 
17

arbitration proceeding. That role is the very one contemplated by the 

amended rule as well as the cases on which the Court relies. See, e.g.,

Ally Align Health, 574 S.W.3d at 758 (“[I]f an arbitrator determines that 

[a party has asserted a carved-out claim], then the arbitrator must refer 

that claim to a court if [the party] desires.”).

On the other hand, arbitrability disputes must necessarily be 

resolved by a court in some cases, and practical difficulties are sure to 

flow from the Court’s holding that the AAA rules oust courts from this 

role entirely. For example, in addition to filing this suit for declaratory

judgment, Total also filed an arbitration claim with the International 

Institute for Conflict Prevention and Resolution (IICPR) as required by 

the parties’ separate Cost Sharing Agreement. Under the Court’s 

decision today, if Total had moved to compel arbitration of its IICPR 

claim—as MP Gulf did with respect to its AAA claim under the System 

Operating Agreement—the trial court would likewise be bound to refer 

any questions concerning the arbitrability of that claim to the 

arbitrators in the IICPR proceeding. And while each organization’s 

rules may provide authority for its arbitrators to determine their own

jurisdiction, it is not clear how such a finding would bind the trial court 

with respect to other pending proceedings (before a separate 

organization under a separate agreement) without begging the very 

same question the Court confronts at the outset: whether courts retain 

any authority to determine de novo the scope of either agreement’s 

incorporation of arbitral rules.

Finally, the approach the Court follows in parsing Rule 7(a)’s 

phrase “shall have the power” is linguistically flawed. The word “shall” 
18

in grants of jurisdiction does not signal exclusivity. For example, 

although federal district courts “shall have original jurisdiction of all 

civil actions arising under” federal law, 28 U.S.C. § 1331, that grant does 

not oust state courts of concurrent jurisdiction. See Tafflin v. Levitt, 493 

U.S. 455, 458-59 (1990). And the definite article “the” is “used to 

designate a particular person or thing, or a particular class of persons 

or things.”5 Although it can be a word of limitation, as the Court 

explains, that does not mean it is a word of exclusion—particularly when 

the thing specified is capable of being shared with other people or things 

not mentioned in the sentence. In particular, any limitation indicated 

by using “the” in referring to a thing that is the object of a sentence 

would naturally apply to that sentence’s subject, not to another noun not 

mentioned.6 So at most, Rule 7(a)’s statement that the arbitrator “shall 

have the power to” do certain things introduces a specified (or perhaps 

limited) list of powers possessed by the sentence’s subject: the arbitrator. 

It suggests nothing about whether other unmentioned people—such as 

judges—shall also have some of those powers.

Because Rule 7(a)—both before and after its amendment—does 

not clearly and unmistakably vest decisionmaking power over 

arbitrability in arbitrators alone, it does not deprive Texas courts of 

their ability to resolve the parties’ disagreement regarding whether 

their dispute falls within the scope of the arbitration clause. 

5 Webster’s New International Dictionary 688 (2d ed. 1934).

6 For example, if I said “he shall wash the red car,” that statement 

designates what he will wash and may be limiting if cars of other colors are 

also waiting to be washed. But the statement does not exclude an unmentioned 

third party from also washing the red car.
19

Accordingly, I would hold that the court of appeals erred in failing to 

reach that issue and reverse and remand for it to do so. 

C.

I conclude with a brief response to the concurring opinion, which 

suggests that we need not resolve whether a trial court or an arbitrator 

is the correct entity to decide whether this dispute falls within the scope 

of the Cost Sharing Agreement’s arbitration clause. Instead, we can 

decide that question ourselves whenever the clause unequivocally 

applies to the dispute and that answer is consistent with a judgment 

below compelling arbitration. Ante at 8-10 (Bland, J., concurring). I 

agree with the Court (ante at 49 n.34), however, that this reasoning does 

not provide an alternative ground for affirmance.

The Court and this dissent start with the question of who decides 

arbitrability for an important reason: if the parties’ agreement provides 

that the arbitrability issue is for the arbitrator to decide (as the Court 

holds), we should not issue an advisory opinion telling the arbitrator 

how to do the job that the parties deliberately assigned to him or her. 

The concurrence’s certainty that the arbitrator would inevitably 

determine that the arbitration agreement applies anyway is the mirror 

image of the practice the U.S. Supreme Court rejected in Henry Schein, 

in which some courts “short-circuit[ed] the process and decide[d] the 

arbitrability question themselves if the argument that the arbitration 

agreement applies to the particular dispute [was] ‘wholly groundless.’” 

139 S. Ct. 524, 527-28 (2019). As the Supreme Court explained, “[w]hen 

the parties’ contract delegates the arbitrability question to an arbitrator, 
20

. . . a court possesses no power to decide the arbitrability issue.” Id. at 

529.

Second, in my view, the arbitrability issue is even more complex 

than the concurrence suggests. As the Court notes, Total’s request for a 

declaratory judgment construing the Cost Sharing Agreement 

potentially implicates three agreements: not only the Cost Sharing 

Agreement itself (which has a forum selection clause choosing litigation 

in Harris County) but also the System Operating Agreement (which MP 

Gulf argues requires AAA arbitration) and the Chinook Operating 

Agreement (which Total argues requires IICPR arbitration). Ante at 2-

3. The concurrence addresses part of this tangled web, concluding that 

the System Operating Agreement’s arbitration clause trumps the Cost 

Sharing Agreement and encompasses this dispute. 

As the Court points out, the parties’ arguments on this issue are 

extensive and detailed. Ante at 46 & n.32. I express no view on whether 

the concurrence’s analysis is correct as far as it goes, as we have no 

power to do so under the Court’s holding that the arbitrability question 

is for the arbitrators to resolve. But I believe it is important to note for 

completeness that other arguments not addressed by the Court or the 

concurrence will presumably be before the arbitrators as well, including 

Total’s arguments that this cost-sharing dispute is more closely related 

to the Cost Sharing Agreement and the Chinook Operating Agreement 

and that its Harris County suit and IICPR arbitration were filed first 

and involve logically antecedent issues so they should proceed first 

under principles of dominant jurisdiction. Because I would hold that 
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these arguments should be addressed by courts rather than arbitrators, 

I respectfully dissent.

 

 J. Brett Busby

 Justice

OPINION FILED: April 14, 2023