IN THE SUPREME COURT OF TEXAS

444444444444

No. 10-0734

444444444444

AMERICO LIFE, INC., AMERICO FINANCIAL LIFE AND ANNUITY INSURANCE

COMPANY, GREAT SOUTHERN LIFE INSURANCE COMPANY, THE OHIO STATE LIFE

INSURANCE COMPANY, AND NATIONAL FARMERS’ UNION LIFE INSURANCE

COMPANY, PETITIONERS,

v.

ROBERT L. MYER AND STRIDER MARKETING GROUP, INC., RESPONDENTS

4444444444444444444444444444444444444444444444444444

ON PETITION FOR REVIEW FROM THE

COURT OF APPEALS FOR THE FIFTH DISTRICT OF TEXAS

4444444444444444444444444444444444444444444444444444

PER CURIAM

This case concerns an arbitration provision that allows each party to appoint one arbitrator

to a panel, subject to certain requirements. At issue is whether Americo Life, Inc. waived its

objection to the removal of the arbitrator it selected. The underlying dispute concerned the financing

mechanism for Americo’s purchase of several insurance companies from Robert Myer.1

 Pursuant

to the financing agreement, Americo and Myer submitted their dispute to arbitration under American

Arbitration Association (AAA) rules. The arbitrators found in favor of Myer, and Americo filed a

1

 Petitioners Americo Life, Inc., Americo Financial Life and Annuity Insurance Company, Great Southern

Life Insurance Company, the Ohio State Life Insurance Company, and National Farmers’ Union Life Insurance

Company are referred to as Americo. Respondents Robert L. Myer and Strider Marketing Group, Inc. are referred to

as Myer.
motion to vacate the award. The trial court granted the motion. It held that Americo was entitled

to any arbitrator that met the requirements set forth in the financing agreement and that the arbitrator

removed by the AAA met those requirements. The court of appeals reversed, holding that Americo

had waived these arguments by not presenting them to the AAA. Because the record demonstrates

otherwise, we reverse the court of appeals’ judgment and remand the case to the court of appeals for

further proceedings. 

The parties entered into a financing agreement for Americo’s purchase of several insurance

companies from Myer. This agreement provides that any disputes “shall be referred to three

arbitrators.” It further provides that “Americo shall appoint one arbitrator and Myer shall appoint

one arbitrator and such two arbitrators to select the third.” The financing agreement provides that

each arbitrator “shall be a knowledgeable, independent businessperson or professional.” 

However, the contract also provides that, subject to exceptions not at issue here, the

proceedings “shall be conducted in accordance with the commercial arbitration rules of the

American Arbitration Association.” At the time the parties entered into the financing agreement,

the AAA rules provided that its “rules and any amendment of them shall apply in the form in effect

at the time the administrative filing requirements are met for a demand for arbitration or submission

agreement received by the AAA.” At the time of the demand for arbitration between the parties, the

AAA rules provided that “[a]ny arbitrator shall be impartial and independent . . . and shall be subject

to disqualification for (i) partiality or lack of independence . . . .”

Here, Myer argued to the AAA that Americo’s selected arbitrator, Ernest Figari, Jr., was not

impartial and therefore should be removed. Americo responded that Figari was, in fact, impartial. 

2
The parties dispute whether Americo additionally responded that its selected arbitrator need only

meet the “independent” and “knowledgeable” requirements from the financing agreement. 

The AAA agreed with Myer and removed Figari from the arbitration panel. Americo

asserted a standing objection to the continuation of the arbitration without Figari. Americo also

stated that it would proceed to arbitrate without waiving its objection and without waiver of the right

to appeal any decision based on the removal of Figari. Americo subsequently selected another

arbitrator. 

The arbitration panel rendered a unanimous decision awarding Myer declaratory relief,

breach of contract damages of $9.29 million, $15.8 million in damages for wrongfully withheld

payments under the financing agreement, and $1.29 million in attorney’s fees and costs. Myer filed

a petition to confirm the award in the district court and Americo filed a motion to vacate or modify

the award. Americo argued that, inter alia, the award was not made by arbitrators selected under

the financing agreement’s requirements and was therefore void.2

 The court granted Americo’s

motion to vacate and found that the AAA failed to follow the arbitration selection method contained

in the financing agreement, that the AAA had no authority to strike Figari, and that the award was

void because it was issued by an improperly appointed panel. 

The court of appeals reversed. It held that: 

After arbitration, appellees argued to the trial court the award should be

vacated under section five of the Federal Arbitration Act because the award was not

made by arbitrators who were appointed under the method provided in the

2

 Americo’s motion to vacate or modify the award was pursuant to section five of the Federal Arbitration

Act (FAA), which provides: “If in the agreement provision be made for a method of naming or appointing an

arbitrator or arbitrators or an umpire, such method shall be followed . . . .” 9 U.S.C. § 5.

3
[financing] agreement. In their brief in support of their motion to vacate the

arbitration award, appellees further explained their argument to mean the [financing]

agreement did not require the party-appointed arbitrators to be “independent and

impartial. Nor does the Agreement allow the AAA to disqualify a party’s appointed

arbitrator for partiality, bias, or any other basis.” They continued to argue that

because their right to select an arbitrator was governed by the standards in the

[financing] agreement, the impartiality standard set out in the AAA rules was

inapplicable. Essentially, appellees argued to the trial court they had a right to a

non-neutral arbitrator. This, however, is not the argument they raised to the AAA

in response to appellants’ objection to Figari.

315 S.W.3d 72, 75 (Tex. App.—Dallas 2009, pet. filed) (emphasis in original) (footnote omitted). 

We have held that “appellate courts should reach the merits of an appeal whenever

reasonably possible.” Perry v. Cohen, 272 S.W.3d 585, 587 (Tex. 2008) (citing Verburgt v. Dorner,

959 S.W.2d 615, 616 (Tex. 1997)). Here, the record demonstrates that Americo argued to both the

AAA and the district court that it was entitled to any arbitrator who met the requirements set forth

in the financing agreement, regardless of the AAA’s requirements.

In response to Myer’s objection to Figari, Americo argued to the AAA that Figari was

neutral. However, Americo also asserted:

Finally, an argument can be made that the AAA rules do not govern the

selection of and qualifications for arbitrators in this proceeding. . . . The Agreement

states that “[e]ach arbitrator shall be a knowledgeable, independent businessperson

or professional.” . . .

As long as Mr. Figari is “a knowledgeable, independent businessperson or

professional,” he is an acceptable designee for the arbitration panel hearing this

matter, irrespective of the AAA rules. . . . Here, the parties’ arbitration agreement

plainly provides the method for selecting arbitrators for the three-person panel and

establishes the qualifications for serving on the panel. . . . Mr. Figari possesses the

requisite qualifications and the fact that he has served previously and is now serving

as a member of a panel considering a dispute between some of these same parties

does not change that fact. There has been—and can be—no allegation that Mr.

Figari has been anything but knowledgeable and independent in his performance on

the panels in Myer I and Myer II.

4
Furthermore, Americo wrote the AAA again after the AAA removed Figari but before the

arbitration, stating: 

[T]he AAA Commercial Arbitration Rules do not govern the selection of and

qualifications for arbitrators to hear disputes between Americo and Myer. . . . The

Agreement states that “[e]ach arbitrator shall be a knowledgeable, independent

businessperson or professional.” . . . 

Mr. Figari is “a knowledgeable, independent businessperson or professional”. 

Therefore, he is a proper designee for the Panel to hear this matter. 

In addition, Americo’s letter to the AAA cited Brook v. Peak International, Ltd., which discusses

the vacation of arbitration awards by arbitrators not appointed under the method provided by a

contract and the preservation of such a complaint by presenting it during arbitration. 294 F.3d 668,

673 (5th Cir. 2002). Americo reiterated this argument in the district court, stating that “the Award

must be vacated under FAA § 5 and applicable law, because the Award was not made by arbitrators

who were appointed under the method provided in the Agreement.” 

The court of appeals is correct that Americo did not expressly state that arbitrators were not

required to be neutral. 315 S.W.3d at 75–76. However, Americo argued that the AAA requirements

did not apply, that the only applicable requirements were that they be knowledgeable and

independent businesspersons or professionals, and that Figari met these qualifications. Americo

properly preserved this argument. Therefore, without hearing oral argument, TEX. R. APP. P. 59.1,

we reverse the court of appeals’ judgment and remand the case to the court of appeals for further

proceedings consistent with this opinion. 

OPINION DELIVERED: December 16, 2011

5