Source: http://texas-arbitration-case-law.blogspot.com/2013/
Timestamp: 2017-06-23 22:23:30
Document Index: 474004703

Matched Legal Cases: ['§ 51', '§ 16', '§ 16', '§ 51', '§\n16', '§ 51', '§ 3', '§ 171', '§\n171', '§ 51', '§ 16', '§\n51', '§ 16', '§ 1', '§ 2', '§\n51', '§ 51', '§ 51', '§ 51', '§\n16', '§ 263', '§ 51', '§ 51', '§\n51', '§ 16', '§ 16', '§ 51']

ADR LAW TEXAS: 2013
Lack of Consideration argument with respect to arbitration agreement
The mutual surrender of the right to trial by jury that is necessarily part of an agreement to arbitrate disputes suffices as consideration under contract law. Regarding any lack-of-consideration
argument, it is well-settled in Texas that "[a] mutual agreement to
arbitrate claims provides sufficient consideration for an arbitration
agreement." Sun Fab Indus.
Contracting Inc. v. Lujan, 361 S.W.3d 147, 152 (Tex. App.-El Paso 2011, no
pet.) (citing In re U.S. Home Corp.,
236 S.W.3d 761, 764 (Tex. 2007) (orig. proceeding) (per curiam)); see In re Tenet Healthcare, Ltd., 84
S.W.3d 760, 767 (Tex. App.-Houston [1st Dist.] 2002, orig. proceeding) (holding
arbitration agreement was supported by consideration where "the parties'
agreement created mutual promises by both to forego their right to a jury
trial"); In re Alamo Lumber Co.,
23 S.W.3d 577, 579-80 (Tex. App.-San Antonio 2000, orig. proceeding)
("Since the parties surrendered their rights to trial by jury, these
mutual promises supply valid consideration."). SOURCE: CORPUS CHRISTI COURT OF APPEALS
- Nos. 13-12-00564-CV AND 13-12-00620-C - 6/27/2013 Posted by
waiver-of-right-to-jury-trial
Effect of interlocutory appeal on case pending the trial court Can you stop the trial court from taking any further action in the case by filing an interlocutory appeal to challenge the denial of a motion to compel arbitration? The appeal does not stop the trial court in its tracks. Abatement may be sought, but is not automatic, as explained by Justice Karen Angelini of the San Antonio Court of Appeals in an August 15, 2013 order. 4th Court of Appeals
in San Antonio ORDER Appellants seek to appeal from an interlocutory order denying a motion to compel arbitration. See TEX. CIV. PRAC. & REM. CODE ANN. 51.016 (West Supp. 2012) (providing that in a matter subject to the Federal Arbitration Act, a person may take an appeal from an interlocutory order under the same circumstances that an appeal from a federal court's order would be permitted). On August 6, 2013, appellants filed a motion to stay all trial court proceedings, including discovery and motion practice, until this appeal is resolved. On August 13, 2013, appellees filed a response to appellants' motion to stay all trial court proceedings. This response also contains a request that this appeal be dismissed for lack of jurisdiction.
While an appeal from an interlocutory order is pending, the trial court retains jurisdiction over the case and, unless prohibited by statute, may make further orders. TEX. R. APP. P. 29.5. If permitted by law, the trial court may even proceed with a trial on the merits. Id. However, the trial court must not make an order that interferes with or impairs the jurisdiction of the appellate court, or the effectiveness of any relief sought or that may be granted on appeal. Id.
In their notice of appeal, appellants claim they are entitled to an appeal of the trial court's interlocutory order based on section 51.016 of the Texas Civil Practice and Remedies Code. This statute, however, does not expressly require a stay of the trial court proceedings during the pendency of an appeal from an interlocutory order. See TEX. CIV. PRAC. & REM. CODE ANN. 51.016. Moreover, nothing indicates the appellants asked the trial court to stay its proceedings before asking this court to stay the trial court's proceedings. See id.; see also TEX. R. APP. P. 29.2 (providing that the trial court may permit an order granting interlocutory relief to be superseded and, if the trial court refuses, the appellate court may review the decision for an abuse of discretion).
Appellants' motion to stay all trial court proceedings is therefore DENIED. It is FURTHER ORDERED that appellees' request to dismiss this appeal for lack of jurisdiction is CARRIED WITH THIS APPEAL.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the said court on this 15th day of August, 2013. SOURCE: SAN ANTONIO COURT OF
APPEALS - Order in Cause No. 04-13-00525-CV issued 2013-08-15 Posted by
motion to abate,
Exceptions to deadline for appealing denial of motion to compel arbitration - Don't count on them
The trial court's denial of a motion to compel arbitration can be appealed immediately, but the right to appeal expires faster than is the case for an appeal from a final judgment because such appeals are accelerated interlocutory appeals. There may be exceptions, but benefiting from them can get pretty tricky, as the following excerpt from the Dallas Court of Appeals in Pilot Travel Centers, LLC v. McCray illustrates. The lesson: Don't take any chances. Appeal within 20 days, or better still, less than 20 days. The clock keeps ticking Section 51.016 of the civil practice and remedies code provides that in a matter subject to the Federal Arbitration Act (FAA), a party may appeal from an interlocutory order of a district court "under the same circumstances that an appeal from a federal district court's order . . . would be permitted by 9 U.S.C. Section 16. TEX. CIV. PRAC. & REM. CODE ANN. § 51.016 (West Supp. 2012); see CMH Homes v. Perez, 340 S.W.3d 444, 448-49 (Tex. 2011) (explaining that section 51.016 of the civil practice and remedies code provides for interlocutory appeals in FAA cases so long as "it would be permitted under the same circumstances in federal court under [9 U.S.C.] section 16"). Section 16 of the FAA provides an appeal may be taken from an order "denying an application under section 206 of this title to compel arbitration." 9 U.S.C.A. § 16(a)(1)(C) (West 2009); Austin Commercial Contractors, L.P. v. Carter & Burgess, Inc., 347 S.W.3d 897, 900 (Tex. App.-Dallas 2011, pet. denied); Texas La Fiesta Auto Sales, LLC v. Belk, 349 S.W.3d 872, 877 (Tex. App.-Houston [14th Dist.] 2011, no pet.).
An appeal from an interlocutory order denying a motion to compel arbitration is an accelerated appeal. See TEX. R. APP. P. 28.1 ("Appeals from interlocutory orders (when allowed by statute) . . . are accelerated appeals."). In an accelerated appeal, the notice of appeal must be filed within twenty days after the judgment or order is signed. TEX. R. APP. P. 26.1(b); see also Iron Mountain Bison Ranch, Inc. v. Easley Trailer Mfg., Inc., 964 S.W.2d 762, 763 (Tex. App.-Amarillo 1998, no pet.) (interlocutory appeal is perfected by filing notice of appeal with trial court within twenty days after judgment or order is signed).
The record contains a November 12, 2012 Order denying Pilot Travel's motion to compel arbitration. The notice of accelerated appeal of the November 12, 2012 Order denying Pilot Travel's motion to compel arbitration had to be filed within twenty days after the date the order was signed. Because the twentieth day after the November 12, 2012 Order fell on Sunday, December 2, 2012, Pilot Travel's deadline for perfecting the appeal from that order fell on the following day, Monday, December 3, 2012. See TEX. R. APP. P. 4.1(a).[3] Pilot Travel filed its notice of appeal on December 28, 2012, beyond the twenty-day deadline for perfecting appeal of the interlocutory November 12, 2012 Order.
In an accelerated appeal, absent a rule of civil procedure 26.3 motion, the deadline for filing a notice of appeal is strictly set at twenty days after the appealable interlocutory order is signed. See In re K.A.F., 160 S.W.3d 923, 927 (Tex. 2005). However, if applicable, rule of civil procedure 306a may operate to extend the deadline for filing a notice of appeal of an interlocutory order. See TEX. R. CIV. P. 306a; see also John v. Marshall Health Servs., Inc., 58 S.W.3d 738, 740 (Tex. 2001). If a party affected by an appealable order has not, within twenty days after the order was signed, either received notice required by rule of civil procedure 306a(3) or acquired actual knowledge of the signing, then any period that, under the rules of appellate procedure, runs from the signing of the order will begin on the earlier of the date when the party receives notice or acquires actual knowledge of the signed order; however, no such period may begin to run more than ninety days after the judgment or order was signed. TEX. R. APP. P. 4.2(a)(1); see also TEX. R. CIV. P. 306a(4).
However, rule of civil procedure 306a(4) is not self-executing. Subsection (5) of rule of civil procedure 306a provides a procedure that enables the trial court to change the date the appellate timetable begins to run from the actual date of the interlocutory order to the date on which the party received the clerk's notice or acquired actual knowledge that the trial court signed the order, whichever occurs first, as long as that date is not more than 90 days after the trial court signed the interlocutory order. TEX. R. CIV. P. 306a(5). "The party adversely affected is required to prove in the trial court, on sworn motion and notice, the date on which the party or his attorney first either received a notice of the judgment or acquired actual knowledge of the signing and that this date was more than twenty days after the judgment was signed." Id.; see Hone v. Hanafin, 105 S.W.3d 15, 18 (Tex. App.-Dallas 2002) (party must obtain order from trial court that reflects date the party or party's attorney first either received notice or acquired actual knowledge that the order was signed), rev'd on other grounds, 104 S.W.3d 884 (Tex. 2003) (per curiam). A parallel provision of the rules of appellate procedure affords additional time for filing documents related to the appeal under the same time parameters and in accordance with the procedures set out in rule of civil procedure 306a(5). TEX. R. APP. P. 4.2(b); see also TEX. R. CIV. P. 306a(5). After conducting the hearing contemplated by rule of civil procedure 306a(5), the trial court "must sign a written order that finds the date when the party or the party's attorney first either received notice or acquired actual knowledge that the judgment or order was signed." TEX. R. APP. P. at 4.2(c); Moore Landrey, L.L.P. v. Hirsch & Westheimer, P.C., 126 S.W.3d 536, 540 (Tex. App.-Houston [1st Dist.] 2003, no pet.). The requirements of rule 306a(5) are jurisdictional. Mem'l Hosp. of Galveston Cnty. v. Gillis, 741 S.W.2d 364, 365 (Tex. 1987) (per curiam); Nedd-Johnson v. Wells Fargo Bank, N.A., 338 S.W.3d 612, 613 (Tex. App.-Dallas 2010, no pet.).
Here, Pilot Travel asserted reliance on rule of civil procedure 306a in its objection and verified motion to vacate the January 16, 2013 Order. The sworn 306a motion served the purpose of establishing a prima facie case of lack of timely notice of the November 12, 2012 Order. See TEX. R. CIV. P. 306a(5). For purposes of appellate jurisdiction, rule of appellate procedure 4.2(c) requires that the trial court sign a written order, pursuant to rule of civil procedure 306a, that finds the date when Pilot Travel or Pilot Travel's attorney first either received notice or acquired actual knowledge that the November 12, 2012 Order denied Pilot Travel's motion to compel arbitration. See TEX. R. APP. P. at 4.2(c); see also Nedd-Johnson, 338 S.W.3d at 613; see also Gillis, 741 S.W.2d at 366 ("Rule 306a plainly requires that this proof be made in the trial court, not the court of appeals."). Without a finding of the date Pilot Travel or its attorney first received notice or actual knowledge of the November 12, 2012 Order, there can be no extension of the appellate timetable for Pilot Travel's notice of appeal of the denial of its motion to compel arbitration. See TEX. R. APP. P. 4.2(c); see also Nedd-Johnson, 338 S.W.3d at 613.
Pilot Travel cites In re C.L.C., No. 12-02-00348-CV, 2003 WL 252139 (Tex. App.-Tyler Feb. 5, 2003, no pet.) (mem. op. on reh'g) in support of its argument that, because the December 12, 2012 Order was the only order denying its motion to compel arbitration that it received, the December 28, 2012 notice of appeal was timely as filed within twenty days of December 12, 2012. However, unlike this case, in In re C.L.C., the trial judge signed an order that included a finding of the earliest date upon which either appellant or appellant's attorney received notice or actual knowledge of the judgment, and appellant's notice of accelerated appeal was timely as filed within twenty days of the date found by the trial judge. In re C.L.C., 2003 WL 252139, at *1.
Rule of appellate procedure 27.3 provides that after an order in a civil case has been appealed, if the trial court modifies the order, the appellate court must treat the appeal as from the subsequent order and may treat actions relating to the appeal of the first order as relating to the appeal of the subsequent order. TEX. R. APP. P. 27.3. While rule 27.3 contemplates the trial court's ability to modify or amend orders that have been appealed, neither the December 12, 2012 Order nor the May 1, 2013 Order modified or amended the trial court's November 12, 2012 Order. By denying Pilot Travel's motion to compel arbitration, the December 12, 2012 Order and the May 1, 2013 Order provided the same substantive ruling contained in the trial court's November 12, 2012 Order. Rule of appellate procedure 29.6 governs our jurisdiction to review "a further appealable interlocutory order concerning the same subject matter." See TEX. R. APP. P. 29.6. Because the December 12, 2012 Order and May 1, 2013 Order are substantively identical to the trial court's November 12, 2012 Order, neither order may be considered a further order of the trial court concerning Pilot Travel's motion to compel arbitration. See TEX. R. APP. P. 29.6(a)(1). To conclude otherwise would enable a trial court to alter an appellate timetable, and render an otherwise untimely appeal timely, simply by signing a subsequent order affording the same relief.
Pilot Travel acknowledged at submission that the trial court's May 1, 2013 Order denying Pilot Travel's motion to compel arbitration made no substantive change to the prior November 12, 2012 Order and December 12, 2012 Order denying Pilot Travel's motion to compel arbitration, and that it was not relying on the May 1, 2013 Order to restart the appellate timetable for filing this interlocutory appeal. Pilot Travel acknowledged it could offer no authority in support of a contention that a trial court can affect or extend the appellate timetable by signing a subsequent order containing the same denial of a motion to compel arbitration contained in the November 12, 2012 Order. See City of Houston v. Estate of Jones, 388 S.W.3d 663, 667 (Tex. 2012) (permitting interlocutory appeal of a denial of a motion to reconsider a plea to jurisdiction "would effectively eliminate the requirement that appeals from interlocutory orders must be filed within twenty days after the challenged order is signed," and "[t]hat would work against the main purpose of the interlocutory appeal statute, which is to increase efficiency of the judicial process."); Bally Total Fitness Corp. v. Jackson, 53 S.W.3d 352, 358 (Tex. 2001) ("Allowing interlocutory appeals whenever a trial court refuses to change its mind . . . would invite successive appeals and undermine the [interlocutory appeal] statute's purpose of promoting judicial economy."). However, according to Pilot Travel, even though the December 12, 2012 Order made no change to the trial court's November 12, 2012 denial of Pilot Travel's motion to compel arbitration other than crossing out the date of November 12, 2012 and writing in the date of December 12, 2012, Pilot Travel contends its notice of appeal was timely because it received notice only of the December 12, 2012 Order, and, therefore, the appellate timetable did not begin to run until it received notice of the December 12, 2012 Order.
Pilot Travel's contention that under rule of civil procedure 306a, its appellate timetable for perfecting its interlocutory appeal ran from the date it or its attorney received notice or actual knowledge of the November 12, 2012 Order fails. Pilot Travel did not establish in the trial court the specific date it or its attorney received notice or actual knowledge of the November 12 Order, and Pilot Travel did not obtain a signed written order from the trial court that recites that specific date. See TEX. R. CIV. P. 306a(5); TEX. R. APP. P. 4.2(b), (c). Because Pilot Travel did not comply with rule of civil procedure 306a(5), it is not entitled to receive an extension of time for perfecting its appeal under rule 4.2. See TEX. R. APP. P. 4.2(b), (c).
Pilot Travel's notice of interlocutory appeal was due, but not filed, within twenty days after the November 12, 2012 appealable interlocutory order was signed. To conclude otherwise would defeat the purpose of the interlocutory appeal statute. Thus, Pilot Travel's notice of appeal was not timely perfected under rule of appellate procedure 26.1(b). See Tex. R. App. P. 26.1(b).
Without a timely filed notice of appeal, this Court lacks jurisdiction. See TEX. R. APP. P. at 25.1. Although the Texas Supreme Court has directed us to construe the rules of appellate procedure reasonably and liberally so that the right to appeal is not lost by imposing requirements not absolutely necessary to effectuate the purpose of a rule, see Verburgt v. Dorner, 959 S.W.2d 615, 616-17 (Tex. 1997), we are prohibited from expanding the scope of our jurisdiction by enlarging the time for perfecting an appeal in a civil case in a manner not provided for by rule. See TEX. R. APP. P. 2; see also In re T.W., 89 S.W.3d 641, 642 (Tex. App.-Amarillo 2002, no pet.). Rule of appellate procedure 2 expressly prohibits this Court from suspending the requirements of the appellate rules in a manner which will "alter the time for perfecting an appeal in a civil case."
Consequently we do not address the merits of this interlocutory appeal. We dismiss this interlocutory appeal for want of jurisdiction. See TEX. R. APP. P. at 42.3(a).
In accordance with this Court's opinion of this date, the appeal is DISMISSED. It is ORDERED that appellees Joan McCray, James McCray, and Shamekia Gullatte, as Next Friend of Brandon Gullate, recover their costs of this appeal from appellant Pilot Travel Centers, LLC.
SOURCE: Pilot Travel Centers, LLC v. McCray, No. 05-13-00002-CV (Tex.App.- Dallas, July 10, 2013)
[1] The January 16, 2013 Order states the trial court considered appellees' "Motion for Judgment Nunc Pro Tunc, and the response thereto." However, the record contains no motion for judgment nunc pro tunc, nor any response by Pilot Travel to such a motion. See TEX. R. CIV. P. 316 (permits trial court to correct mistakes and incorrect recitals in judgments but only after reasonable notice of any application for correction is given to opposing party).
[2] In its objection to the January 16, 2013 order and motion to vacate that order, Pilot Travel stated it was never served with a motion for judgment nunc pro tunc.
[3] On appeal, the parties do not dispute the trial court conducted a hearing on Pilot Travel's motion to compel arbitration on November 16, 2012. However, no reporter's record containing a transcript of the November 16, 2012 hearing has been filed with this Court. Even assuming the November 12, 2012 date of signature on the order was incorrect and should have been November 16, 2012, the deadline for filing an accelerated appeal of a November 16, 2012 denial of Pilot Travel's motion to compel arbitration would have been December 6, 2012.
Under rule of appellate procedure 26.3, an appellate court may extend the time to file a notice of appeal if, within fifteen days after the deadline for filing the appeal notice, the party files a notice of appeal in the trial court and a motion for extension of time complying with rule of appellate procedure 10.5(b) in the court of appeals. See TEX. R. APP. P. 26.3. In Verburgt v. Dorner, 959 S.W.2d 615, 617 (Tex. 1997), the Texas Supreme Court held that a motion for extension of time is implied when a party, acting in good faith, files a cost bond within the fifteen-day period in which the party would be entitled to move to extend the filing deadline under the rules of appellate procedure. To be entitled to an implied fifteen-day extension to file its notice of appeal under rule of appellate procedure 26.3 from the November 12, 2012 Order, Pilot Travel would have had to file its notice of appeal by December 18, 2012. To be entitled to an implied fifteen-day extension to file its notice of appeal under rule of appellate procedure 26.3 from November 16, 2012, Pilot Travel would have had to file its notice of appeal by December 21, 2012.
accelerated appeals,
appellate deadline,
appellate jurisdiction,
interlocutory appeal dismissed,
Trial court order compelling arbitration not immediately appealable
Can an order compelling arbitration signed by a trial judge be challenged in an immediate appeal so as to avoid the need to arbitrate? Generally no. Arbitration is favored. An order denying arbitration is a
different matter. Texas statute authorizing interlocutory appeal tracks federal
provision for such appeals. Under the Federal Arbitration Act (FAA),
an order compelling arbitration and granting a stay is not immediately
reviewable. In re Gulf Exploration, LLC,
289 S.W.3d at 842; see 9 U.S.C.A. § 16(b)(1),(3)(West 2009)(interlocutory
orders compelling arbitration and staying proceeding are not immediately
reviewable under the FAA). Because such an order is not appealable under the
FAA, it is not appealable under Section 51.016 of the Texas Civil Practice and
Remedies Code. See TEX. CIV. PRAC.
& REM. CODE ANN. § 51.016 (West Supp. 2012)(in matters subject to the FAA,
an appeal is available only under the same circumstances that an appeal from
federal district court's order would be permitted). MEMORANDUM OPINION FROM EL PASO In this employment-discrimination and
-retaliation case, Benjamin Tice, Jr. appeals from the trial court's order
granting El Paso Education Initiative, Inc. d/b/a Burnham Wood Charter School
District's motion to compel arbitration and stay the proceedings. El Paso
Education Initiative now moves to dismiss the appeal for want of
jurisdiction.[1] Concluding that we lack jurisdiction over this appeal, we
It is well settled that appellate courts
have jurisdiction over final judgments. Lehmann v. Har-Con Corp., 39 S.W.3d
191, 195 (Tex. 2001). A judgment is final if it disposes of all pending parties
and claims. Id. An order compelling arbitration and staying proceedings pending
arbitration does not dispose of all claims and parties. In re Gulf Exploration,
LLC, 289 S.W.3d 836, 840-41 (Tex. 2009)(orig. proceeding). Thus, the trial
court's order at issue here is interlocutory.
Appellate courts have jurisdiction to
consider immediate appeals of interlocutory orders only if a statute explicitly
confers appellate jurisdiction. See Stary v. DeBord, 967 S.W.2d 352, 352-53
(Tex. 1998). If a statute authorizes an interlocutory appeal, we strictly
construe it. CMH Homes v. Perez, 340 S.W.3d 444, 447-48 (Tex. 2011); Nazareth
Hall Nursing Ctr. v. Castro, 374 S.W.3d 590, 593 (Tex.App.-El Paso 2012, no
pet.); Lucchese, Inc. v. Solano, 388 S.W.3d 343, 348 (Tex.App.-El Paso 2012, no
pet.). The substance and function of the interlocutory order from which an
appeal is taken controls our interlocutory jurisdiction. Castro, 374 S.W.3d at
593; Solano, 388 S.W.3d at 348; Texas La Fiesta Auto Sales, LLC v. Belk, 349
S.W.3d 872, 878 (Tex.App.-Houston [14th Dist.] 2011, no pet.). When a party
attempts to appeal a non-appealable interlocutory order, we have no
jurisdiction except to dismiss the appeal. Cantu Servs., Inc. v. United Freedom
Assoc., Inc., 329 S.W.3d 58, 63 (Tex.App.-El Paso 2010, no pet.) [Quotation
marks omitted].
Under the Federal Arbitration Act (FAA),
reviewable. In re Gulf Exploration, LLC, 289 S.W.3d at 842; see 9 U.S.C.A. §
16(b)(1),(3)(West 2009)(interlocutory orders compelling arbitration and staying
proceeding are not immediately reviewable under the FAA). Because such an order
is not appealable under the FAA, it is not appealable under Section 51.016 of
the Texas Civil Practice and Remedies Code. See TEX. CIV. PRAC. & REM. CODE
ANN. § 51.016 (West Supp. 2012)(in matters subject to the FAA, an appeal is
available only under the same circumstances that an appeal from federal
district court's order would be permitted). Here, both parties agreed at trial that
the arbitration agreement was governed by the FAA, not the Texas General
Arbitration Act (TAA).[2] The trial court's order compelling arbitration and
staying the proceedings pending arbitration is therefore not reviewable by
interlocutory appeal. We thus lack jurisdiction to consider Tice's appeal.
Appellee's motion to dismiss the appeal for want of jurisdiction is hereby
granted. Accordingly, we dismiss the appeal for want of jurisdiction. SOURCE: EL PASO COURT OF APPEALS - No.
08-13-00014-CV – 1/13/2013
When should a motion to compel arbitration be granted, when not? General principles of determining arbitrability as articulated by the Corpus Christi Court of Appeals in a recent appellate opinion.
"We review a trial court's denial
on a motion to compel arbitration for an abuse of discretion." Nazareth
Hall Nursing Ctr. v. Melendez, 372 S.W.3d 301, 304 (Tex. App.-El Paso 2012, no
pet.) (citing Sidley Austin Brown & Wood, LLP v. J.A. Green Dev. Corp., 327
S.W.3d 859, 862-63 (Tex. App.-Dallas 2010, no pet.)). Under that standard,
"we defer to the trial court's factual determinations if they are
supported by evidence, but we review the trial court's legal determinations de
novo." In re Labatt Food Serv., L.P., 279 S.W.3d 640, 643 (Tex. 2009); see
Melendez, 372 S.W.3d at 305. "Whether an arbitration clause imposes a duty
to arbitrate is a matter of contract interpretation and a question of law for
the Court to review de novo." Ascendant Anesthesia PLLC v. Abazi, 348
S.W3d 454, 458 (Tex. App.-Dallas 2011, no pet.). "In a de novo review, the
trial court's decision is given absolutely no deference." Id.
Although Villareal opposes arbitration,
he does not contest that the FAA applies to the Account Agreement with Edward
"A party seeking to compel arbitration under the FAA must establish
that (1) there is a valid arbitration clause, and (2) the claims in dispute
fall within that agreement's scope." In re Rubiola, 334 S.W.3d 220, 223
(Tex. 2011) (orig. proceeding); see In re East Rio Hondo Water Supply Corp.,
No. 13-12-538-CV, 2012 Tex. App. LEXIS 9098, at *10 (Tex. App.-Corpus Christi
Oct. 29, 2012, orig. proceeding) (mem. op.). "When deciding whether claims
fall within an arbitration agreement, courts employ a strong presumption in favor
of arbitration." In re Rubiola, 334 S.W.3d at 225. "Nonetheless, the
strong policy in favor of arbitration cannot serve to stretch a contractual
clause beyond the scope intended by the parties or to allow modification of the
unambiguous meaning of the arbitration clause." Osornia v. AmeriMex Motor
& Controls, Inc., 367 S.W.3d 707, 712 (Tex. App.-Houston [14th Dist.] 2012,
no pet.).
"To determine whether a claim falls
within the scope of the agreement, courts must `focus on the factual
allegations of the complaint, rather than the legal causes of action
asserted.'" In re Rubiola, 334 S.W.3d at 225 (quoting Prudential Sec. Inc.
v. Marshall, 909 S.W.2d 896, 900 (Tex. 1995)); In re Stanford Group, 273 S.W.3d
807, 813 (Tex. App.-Houston [14th Dist.] 2008, orig. proceeding) ("We look
at the facts alleged, rather than the legal causes of actions presented, and
consider whether the facts touch matters covered by the underlying arbitration
agreement.") Generally, under the FAA, state law governs whether the contracting
parties agreed to arbitrate and federal law determines the scope of the
arbitration clause. In re Weekley Homes, L.P., 180 S.W.3d 127, 130 (Tex. 2005)
(orig. proceeding); see In re Rubiola, 334 S.W.3d at 224 ("Under the FAA,
ordinary principles of state contract law determine whether there is a valid
agreement to arbitrate.").
Arbitration agreements containing
phrases such as "relating to" are interpreted broadly. In re
Guggenheim Corporate Funding, LLC, 380 S.W.3d 879, 887-88 (Tex. App.-Houston
[14th Dist.] 2012, orig. proceeding) (citing In re Bank One, N.A., 216 S.W.3d
825. 826-27 (Tex. 2007) (resolving doubt as to scope of arbitration agreement
covering disputes "arising from or relating in any way to this
Agreement" in favor of coverage); 950 Corbindale, L.P. v. Kotts Capital
Holdings Ltd. P'ship, 316 S.W.3d 191, 196-97 (Tex. App.-Houston [14th Dist.]
2010, no pet.) (holding that broad arbitration provision defining
"disputes" as "any dispute under or related to the partnership
agreement or any document executed pursuant to the partnership agreement or any
of the transactions contemplated by the partnership agreement shall be subject
to arbitration" applied to all claims); TMI Inc. v. Brooks, 225 S.W.3d
783, 791 n.7 (Tex. App.-Houston [14th Dist.] 2007, orig. proceeding) (holding
that phrase "arising out of and/or related to" in arbitration
agreement is "broad form in nature, evidencing the parties' intent to be
inclusive rather than exclusive")). "
However, if the facts alleged in
support of the claim stand alone, are completely independent of the contract,
and the claim could be maintained without reference to the contract, the claim
is not subject to arbitration." Serv. Corp. Int'l v. Lopez, 162 S.W.3d
801, 810 (Tex. App.-Corpus Christi 2005, no pet.); see Osornia, 367 S.W.3d at
714 n.4.; AutoNation USA Corp. v. Leroy, 105 S.W.3d 190, 195 (Tex. App.-Houston
[14th Dist.] 2003, orig. proceeding); see also In re Estate of Rowan, No.
05-06-681-CV, 2007 Tex. App. LEXIS 4466, at *8-9 (Tex. App.-Dallas June 7, 2007,
no pet.) (mem. In construing the arbitration provision, we first determine
whether it is possible to enforce the contract as written, without resort to
parol evidence. J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 229 (Tex.
2003). In construing a written contract, the primary concern of the court is to
ascertain the true intentions of the parties as expressed in the instrument. In
re Guggenheim Corporate Funding LLC, 380 S.W.3d at 887 (citing J.M. Davidson,
128 S.W.3d at 229). In the arbitration context, we must give effect to the
parties' intent, whether enforcing an agreement to arbitrate or construing an
arbitration clause. Id. Following arbitration jurisprudence, we apply a
common-sense examination of the underlying claim and the forum-selection clause
to determine if the claim comes within the scope of the clause. Id. (citing In
re Lisa Laser USA, Inc., 310 S.W.3d 880, 884 (Tex. 2010) (orig. proceeding)
(per curiam)). "A contract is unambiguous if it can be given a definite or
certain legal meaning." J.M. Davidson, 128 S.W.3d at 229. "On the
other hand, if the contract is subject to two or more reasonable
interpretations after applying the pertinent rules of construction, the contract
is ambiguous, creating a fact issue on the parties' intent." Id. A
contract is not ambiguous merely because the parties disagree on its meaning.
Seagull Energy E & P, Inc. v. Eland Energy, Inc., 207 S.W.3d 342, 345 (Tex.
2006). The issue of contractual ambiguity may be considered sua sponte by a
reviewing court. See Progressive Cnty. Mut. Ins. Co. v. Kelley, 284 S.W.3d 805,
808 (Tex. 2009). op.).
SOURCE: CORPUS CHRIST-EDINBURG COURT OF APPEALS - 13-12-00166-CV – 2/21/2013 Posted by
Undue delay renders mandamus relief unavailable Due diligence is required in seeking mandamus relief. That alone will not guarantee success, of course; but if you wait too long before deciding to complain about the trial court judge in the court of appeals, you may as well forget it. PER CURIAM MEMORANDUM OPINION FIRST COURT OF APPEALS IN HOUSTON
By petition for writ of mandamus,
relator, Cox Ventures, Inc. d/b/a Media Ink, seeks mandamus relief compelling
the trial court to vacate its order granting Real Party in Interest, KNG L.L.C.
d/b/a Texas Direct Bindery & Letterpress's application to compel
arbitration and motion to sever.[1] We deny Cox's petition for writ of
On October 4, 2011, KNG sued Cox
alleging claims based on a sworn account, breach of contract, quantum meruit,
and unjust enrichment. Following the filing of its original answer, Cox
asserted a counterclaim against KNG alleging breach of contract and conversion.
KNG timely filed its answer.
KNG subsequently filed an application to
compel arbitration of Cox's counterclaim and a motion to sever it from KNG's
claims. Cox filed its response and a counter-motion to compel arbitration of
all of the parties' claims. On April 9, 2012, the trial court signed an order
granting KNG's application to compel arbitration of Cox's counterclaim and its
On September 28, 2012, Cox filed this
petition for writ of mandamus. In its petition, Cox complains that the trial
court abused its discretion by compelling arbitration of Cox's counterclaim and
severing it from KNG's claims rather than compelling arbitration of all of the
Mandamus is an extraordinary remedy; it
is not issued as a matter of right but rather at the discretion of the court.
Rivercenter Assocs. v. Rivera, 858 S.W.2d 366, 367 (Tex. 1993). Mandamus relief
is not an equitable remedy but its issuance is largely controlled by equitable
principles. Id. One such principle is that "[e]quity aids the diligent and
not those who slumber on their rights." Id. (quoting Callahan v. Giles,
155 S.W.3d 793 (1941)).
Here, Cox filed its petition for writ of
mandamus nearly six months after the court signed its April 9 order.[2] Cox
offers no justification for its delay in seeking mandamus relief and the record
reveals none. Delay alone provides ample ground to deny mandamus relief. See
International Awards, Inc. v. Medina, 900 S.W.2d 934, 936 (Tex. App.-Amarillo
1995, orig. proceeding) (finding four-month delay between court's severance
order of counterclaim and relator's petition for writ of mandamus provided
grounds to deny requested relief); Furr's Supermarkets, Inc. v. Mulanax, 897
S.W.2d 442, 443 (Tex. App.-El Paso 1995, orig. proceeding) (denying relator's
motion for leave to file petition for writ of mandamus filed four months after
court's oral discovery ruling and one month after written order was signed and
where relator offered no explanation for delay); Bailey v. Baker, 696 S.W.2d
255, 256 (Tex. App.-Houston [14th Dist.] 1985, orig. proceeding) (denying
motion for leave to file petition for writ of mandamus where relator waited
nearly four months to file motion and provided no justification for delay). Accordingly, we deny Cox's petition for writ of mandamus and lift the stay
entered on September 26, 2012.
SOURCE: HOUSTON COURT OF APPEALS FIRST DISTRICT - No. 01-12-00879-CV - 3/7/2013
[1] The underlying case is KNG, L.L.C.
d/b/a Texas Direct Bindery & Letterpress v. Cox Ventures, Inc. d/b/a Media
Ink, Cause No. 1002161, pending in County Civil Court at Law No. 1 of Harris
County, Texas, the Honorable Debra Ibarra Mayfield, presiding. Posted by
mandamus denied,
undue-delay
What happens to additional parties in the same lawsuit that are not required to arbitrate when others are sent to arbitration?
Fort Worth Court of Appeals says when arbitration stay kicks in, it also affects other parties in the lawsuit that are not required to submit to arbitration, i.e. the entire action is stayed. The appellate panel opinion does not discuss whether a motion to sever the portion of the case not subject to arbitration would be appropriate. Whether Suit Must Be Abated Pending Arbitration
In their second issue, appellants contend the trial court also erred by
failing to stay the underlying proceedings pending resolution of arbitration.
Federal law requires courts to stay litigation of claims that are subject to
arbitration until arbitration is completed. 9 U.S.C.A. § 3; In re Merrill Lynch
Trust Co. FSB, 235 S.W.3d 185, 195-96 (Tex. 2007) (orig. proceeding). Even when
a party has brought arbitrable claims against one party and claims not subject
to arbitration against another party in the same lawsuit, courts should stay
all litigation. See In re Merrill Lynch Trust Co., 235 S.W.3d at 195-96.
Accordingly, because we have determined that appellees' claims against
appellants are subject to arbitration, we conclude and hold that the litigation
must be stayed pending arbitration. See In re Helix Energy Solutions Group,
Inc., 303 S.W.3d 386, 403 (Tex. App.-Houston [14th Dist.] 2010, orig.
proceeding). We sustain appellants' second issue.
SOURCE: FORT WORTH COURT OF APPEALS - No. 02-12-00276-CV – 2/14/2013 Posted by
arbitration-stay,
Trial court judge strayed beyond the gateway area - mandamus granted
Houston Court of Appeals holds that trial court went beyond its limited role of determining gateway matters and strayed into arbitrators' territory by taking up issues of manner and procedure relating to the arbitration process. OPINION BY JANE BLAND
This is an interlocutory appeal and a
companion petition for a writ of mandamus that challenge the trial court's
order designating an arbitral forum. Donna Miller, both individually and as the
executor of her deceased husband's estate, has sued her husband's former
employers, Academy, Ltd. and Academy Managing Co., L.L.C. (Academy), contending
that Academy breached its agreement, pursuant to its executive compensation
plan, to pay the estate $2.4 million if Academy underwent a change of control
within a three-year period.
Academy invoked the agreement's
arbitration provision and moved in the trial court to compel arbitration, which
it did. Then, in a motion to clarify that ruling, Miller asked the trial court
to interpret the arbitration provision as not requiring administration by the
American Arbitration Association. In its order granting Miller's motion, the
trial court declared that "the previously ordered arbitration of this
cause shall be conducted privately and without having to file and administer
the arbitration with the American Arbitration Association."
Academy seeks either appellate or
mandamus relief from the trial court's order granting Miller's motion to
clarify and supplementing its prior order compelling arbitration. We hold that
we lack jurisdiction over Academy's appeal, but we exercise our mandamus
jurisdiction to correct the trial court's error in interpreting a contract
issue that properly belongs to the arbitrators. We therefore conditionally
grant the writ.
In 2007, Academy established an
executive compensation plan, named "Plan I," for certain employees,
including the decedent. Plan I contains the following arbitration provision:
Section 14. Dispute Resolution;
(a) The exclusive venue for any action
in respect of Section 13 of this Retention Plan shall be the state and Federal
courts located in Harris County, Texas.
(b) Except as provided in Section 14(a)
above, any controversy or claim arising out of or relating to this Retention
Plan Shall be settled by arbitration in Harris County, Texas by three
arbitrators appointed by the parties. If the parties cannot agree within 30
days on the appointment of arbitrators, one shall be appointed by the Company
and one by the applicable Participant, and the third shall be appointed by the
first two arbitrators. The arbitration shall be conducted in accordance with
the rules of the American Arbitration Association for resolution of commercial
disputes, except with respect to the selection of arbitrators, which shall be
as provided in this paragraph. Any award entered by the arbitrators shall be
final, binding and nonappealable and judgment may be entered thereon by either
party in accordance with applicable law in any court of competent jurisdiction.
This arbitration provision shall be specifically enforceable. The arbitrators
have no authority to modify any provision of this Retention Plan other than a
benefit specifically provided under or by virtue of the Retention Plan. If a
Participant substantially prevails on at least one material issue which is the
subject of such arbitration, the Company shall be responsible for all of the
fees and expenses of the American Arbitration Association and the arbitrators.
Otherwise, each party shall share the fees and expenses of the American
Arbitration Association and the arbitrators equally.
The parties do not contend that their
arbitration agreement is governed exclusively by either the Federal Arbitration
Act or the Texas General Arbitration Act, and Academy has invoked both sections
51.016 and 171.098 of the Texas Civil Practice and Remedies Code as the basis
for our jurisdiction over its appeal. As a threshold issue, Miller challenges
whether appellate jurisdiction exists, contending that Academy's challenge to
the trial court's order requiring a non-AAA-administered arbitration does not fall
within any of the specific grounds for appeal that either of these sections
authorizes.
Section 171.098(a)(1), the appeal
provision of the state arbitration statute, requires, as a predicate to our
interlocutory appellate jurisdiction, the filing of "an application to
compel arbitration made under Section 171.021" and an order denying that
application. TEX. CIV. PRAC. & REM. CODE ANN. § 171.098 (West 2012). To
prevail under Section 171.021, such a motion must show the existence of an
agreement to arbitrate that applies to the parties' dispute and that the
opposing party has refused to arbitrate. TEX. CIV. PRAC. & REM. CODE ANN. §
171.021(a) (West 2012). Section 51.016 allows for state court appeals in
agreements governed by the FAA. TEX. CIV. PRAC. & REM. CODE ANN. § 51.016
(West 2012). Pertinent to this case, a party may appeal (1) an order refusing
to stay litigation pending arbitration of its subject matter, (2) denial of a
petition to order arbitration, and (3) an order denying an application to compel
arbitration. Id. (incorporating grounds set forth in 9 U.S.C. § 16).
The appealed order, purporting to
clarify the parties' rights under the arbitration agreement, does not fall
within any of the types of appealable orders identified under either the state
or federal statutes. We therefore lack appellate jurisdiction over Academy's
attempted interlocutory appeal.
II. Mandamus Jurisdiction
Academy alternatively seeks mandamus
relief, complaining that the trial court abused its discretion in signing the
order, because it effectively denies Academy's right to arbitrate the
underlying dispute according to the arbitration agreement's terms. A writ of
mandamus issues to correct a clear abuse of discretion when no adequate remedy
at law exists. Walker v. Packer, 827 S.W.2d 833, 839 (Tex. 1992). A trial court
has no discretion to apply the law incorrectly. Id. at 840. A party seeking
relief from the failure to enforce a valid arbitration agreement, according to
its terms, has no adequate remedy at law and is entitled to mandamus relief to
correct the trial court's error. See In re Serv. Corp. Int'l, 355 S.W.3d 655,
657 (Tex. 2011) (orig. proceeding) (holding that mandamus relief is available
from trial court's appointment of arbitrator in contravention of parties'
agreement that they would select arbitrator by mutual agreement or, if unable
to agree, seek appointment by AAA); see Aspen Tech., Inv. v. Shasha, 253 S.W.3d
857 (Tex. App.-Houston [14th Dist.] 2008, orig. proceeding) (granting relief
from trial court's order compelling arbitration under clause in parties' 2006
agreement instead of under parties' 2008 agreement, which had valid arbitration
clause that supplanted earlier one); accord BP Exploration Libya Ltd. v.
ExxonMobil Libya Ltd., 689 F.3d 481, 496-97 (5th Cir. 2012) (vacating district
court's order requiring parties to proceed to arbitration before five
arbitrators, where parties had expressly agreed to arbitrate before
three-member panel).
The parties' arbitration agreement
provides that they are to select three arbitrators by mutual agreement, or, if
they "cannot agree within 30 days on the appointment of arbitrators, one
shall be appointed by the Company and one by the applicable Participant, and
the third shall be appointed by the first two arbitrators." The parties
apparently have no quarrel over this selection method, and they can comply with
it before determining whether the arbitration is subject to formal AAA
Because no obstacle to the appointment
of the arbitrators exists, we next consider if the question decided by the
trial court—whether the arbitration agreement requires the parties to file and
administer the arbitration through the American Arbitration Association or
merely requires that the arbitrators use the rules set forth by the AAA—is for
the courts or the arbitrators to decide. In Green Tree Financial Corp. v.
Bazzle, the United States Supreme Court explained the narrow scope of the
judicial role in interpreting arbitration agreements:
In certain limited circumstances, courts
assume that the parties intended courts, not arbitrators, to decide a
particular arbitration-related matter (in the absence of "clea[r] and
unmistakabl[e]" evidence to the contrary). AT&T Technologies, Inc. v.
Communications Workers, 475 U. S. 643, 649 (1986). These limited instances
typically involve matters of a kind that "contracting parties would likely
have expected a court" to decide. Howsam v. Dean Witter Reynolds, Inc.,
537 U. S. 79, 83 (2002). They include certain gateway matters, such as whether
the parties have a valid arbitration agreement at all or whether a concededly
binding arbitration clause applies to a certain type of controversy. See
generally Howsam, supra. See also John Wiley & Sons, Inc. v. Livingston,
376 U. S. 543, 546-547 (1964) (whether an arbitration agreement survives a
corporate merger); AT&T, supra, at 651-52 (whether a labor-management
layoff controversy falls within the scope of an arbitration clause).
539 U.S. 444, 452 (2003); see also
Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 82-83, 123 S. Ct. 588, 591
(2002) (holding that applicability of NASD time limit rule is matter
presumptively for arbitrator, not for judge). The question of whether the
parties agreed to formal AAA administration in this case concerns neither the
validity nor the scope of the arbitration agreement. Consequently, the issue
belongs to the arbitrators, not to the courts. See Howsam, 537 U.S. at 83; In
re D. Wilson Constr. Co., 196 S.W.3d 774, 780-81 (Tex. 2006) (orig. proceeding);
see also Austin Commercial Contractors, L.P. v. Carter & Burgess, Inc., 347
S.W.3d 897, 902 (Tex. App.-Dallas 2011, pet. denied) (holding that challenge to
Civilian Board of Contract Appeals' [CBCA] jurisdiction as arbitrator of
dispute, as well as waiver and election-of-remedies complaints, "are
matters of procedure that are for the arbitrator and not for the court,"
and conditionally granting writ of mandamus directing trial court to vacate
portion of order requiring arbitration to proceed under AAA instead of CBCA);
Am. Realty Trust, Inc. v. JDN Real Estate—McKinney, L.P., 74 S.W.3d 527, 531
(Tex. App.-Dallas 2002, pet. denied) (citing John Wiley & Sons v.
Livingston, 376 U.S. 543, 557, 84 S. Ct. 909, 918 (1964) ("[I]f a court
determines the parties have an obligation to submit the subject matter of a
dispute to arbitration, `procedural' questions concerning the dispute . . . are
left to the arbitrator.")). We hold that the trial court erred in straying
past the gateway and into the arbitrators' presumptive arena by addressing
whether the parties agreed to formal AAA administration and ordering that they
We dismiss Academy's appeal for lack of
jurisdiction. We conditionally grant mandamus relief to Academy and direct the
trial court to vacate its March 5, 2012 order supplementing its earlier order
compelling arbitration. We are confident the trial court will comply, and the
writ will issue only if it fails to do so.
SOURCE: HOUSTON COURT OF APPEALS - Nos. 01-12-00293-CV & 01-12-00356-CV – 2/21/2013
gateway issues,
First Court of Appeals (Houston) denies mandamus petition of a defendant who lost on a motion to compel arbitration under the FAA in the trial court, but did not avail
itself of interlocutory appeal, which the Texas legislature authorized to obviate
the need for the court of appeals to entertain mandamus petitions as a gap-filler mechanism. But the
majority on the panel stops short of announcing a bright-line rule to the effect that mandamus
is no longer available at all under these circumstances, based on the remedy of accelerated
appeal having been created by statute. One panel member only concurred in the result. IN RE SANTANDER CONSUMER USA, INC ,
No. 01-12-00728-CV (Tex.App.- Houston [1st
Dist.] Feb. 21, 2013) (majority opinion by Justice Harvey Brown) COMMENT: By failing to hold that an interlocutory appeal always constitutes an adequate remedy precluding mandamus relief (which is supposed to be extra-ordinary), the panel is only inviting more mandamus petitions by counsel for defendants who would rather arbitrate, but aren't diligent in bringing an immediate appeal, or are simply not up-to-speed on the change in the law, which has now been on the books for more than two years. A clear precedent ruling out mandamus relief would have been more useful, and would no doubt have prevented energy and time being spent on excursions to the courts of appeals in at least some subsequent cases in which a denial of arbitration was not timely appealed, since a mandamus petition would have been rendered an exercise in futility. OPINION BY HARVEY BROWN The trial court denied Santander Consumer USA, Inc.'s motion to compel
arbitration pursuant to the Federal Arbitration Act.[1] Although the Civil
Practice and Remedies Code provides for immediate, interlocutory review of the
denial of a motion to compel arbitration under the FAA, Santander did not
appeal the trial court's order. See TEX. CIV. PRAC. & REM. CODE ANN. §
51.016 (West Supp. 2011) ("In a matter subject to the [FAA], a person may
take an appeal . . . to the court of appeals from the judgment or interlocutory
order of a district court, county court at law, or county court under the same
circumstances that an appeal from a federal district court's order or decision
would be permitted by 9 U.S.C. Section 16."); 9 U.S.C. § 16(a)(1)(C)
(2006) (FAA provision permitting appeals of orders denying application to
compel arbitration); CMH Homes v. Perez, 340 S.W.3d 444, 448-49 (Tex. 2011)
(explaining that section 51.016 provides for interlocutory appeals in FAA cases
so long as "it would be permitted under the same circumstances in federal
court under section 16"). Instead, after the expiration of the time for
filing an interlocutory appeal, Santander challenged the trial court's order by
petition for writ of mandamus. We conclude that the writ should not issue under
the circumstances of this case, and we therefore deny Santander's petition.
Jan Bonner executed a retail installment contract and security
agreement with Ron Hoover RV and Marine for the purchase of boating equipment.
An assignment from Ron Hoover to GEMB Lending, Inc. appears on the face of the
contract. Santander alleges that it later acquired the contract from GEMB. When
Santander attempted to collect amounts due under the contract from Bonner,
Bonner filed the underlying lawsuit alleging that he was not liable to
Santander on the contract and that Santander's collection efforts violated the
Texas Fair Debt Collection Practices Act and the Texas Deceptive Trade
Practices Act. Santander answered the lawsuit and moved to compel arbitration
pursuant to an arbitration clause in the contract providing in pertinent part:
[A]ny claim or dispute in contract, tort, statute or otherwise . . .
that arises out of or relates to your credit application, this Contract or any
resulting transaction or relationship, including those with third parties who
do no sign this Contract, is to be decided by neutral binding arbitration. . .
. The Federal Arbitration Act (9 U.S.C. § 1 et seq.) governs this arbitration
agreement and not any state law concerning arbitration, including state law
arbitration rules and procedures.
Bonner opposed the motion to compel on the ground that Santander failed
to establish that it had properly acquired the contract from GEMB. The trial
court denied Santander's motion.
Rather than file a timely notice of interlocutory appeal from the trial
court's order denying the motion to compel arbitration, Santander filed this
petition for writ of mandamus more than forty days after the time for taking an
interlocutory appeal had expired.
Mandamus Standard
The standard for the issuance of a writ of mandamus is well
established. The writ will issue only if the trial court clearly abused its
discretion and, relevant here, the relator has no adequate remedy by appeal. In
re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135-36 (Tex. 2004) (orig. proceeding);
Walker v. Packer, 827 S.W.2d 833, 839 (Tex. 1992) (orig. proceeding). Although
"the standard's `operative word, "adequate", has no
comprehensive definition' and demands a `careful balance of jurisprudential
considerations that determine when appellate courts will use original mandamus
proceedings to review the actions of lower courts,' mandamus will not issue
when the law provides another plain, adequate, and complete remedy." In re
Tex. Dep't of Family & Protective Servs., 210 S.W.3d 609, 613 (Tex. 2006)
(orig. proceeding) (quoting In re Prudential, 148 S.W.3d at 135-36); see also
In re Columbia Med. Ctr. of Las Colinas, Subsidiary, L.P., 290 S.W.3d 204, 207
(Tex. 2009) (orig. proceeding) ("Mandamus should not issue to correct
grievances that may be addressed by other remedies."); State v. Walker,
679 S.W.2d 484, 485 (Tex. 1984) (orig. proceeding) (holding mandamus will not
issue where there is "a clear and adequate remedy at law, such as a normal
appeal").
Santander has not established its entitlement to mandamus relief
According to Santander, the Texas Supreme Court has determined that
mandamus is the appropriate remedy for the wrongful denial of a motion to
compel arbitration under the FAA without the necessity of demonstrating the
lack of an adequate appellate remedy on a case-specific basis. See, e.g., In re
Dillard Dept. Stores, Inc., 198 S.W.3d 778, 782 (Tex. 2006) (orig. proceeding,
per curiam) (granting writ of mandamus and ordering trial court to vacate its
order denying motion to compel arbitration without reviewing whether an
adequate remedy existed); In re Vesta Ins. Group, Inc., 192 S.W.3d 759, 763-64
(Tex. 2006) (orig. proceeding, per curiam) (same). The Court first addressed
the issue of whether to grant mandamus relief to a party denied arbitration
under the FAA in Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 269, 272 (Tex.
1992) (orig. proceeding). There, the Court determined that a party improperly
denied the benefit of arbitration under the FAA had no right to an
interlocutory appeal and "urge[d] the legislature to consider amending the
Texas [Arbitration] Act to permit interlocutory appeals of orders issued
pursuant to the Federal Act." Id. at 272. The Court stated, "Such a
procedure, already available for orders under the Texas Act, [would be]
preferable to reliance on the writ of mandamus to fill this gap in appellate
jurisdiction." Id. Until such time as the legislature acted, the Court
determined that a party could seek mandamus relief or else the very subject of
an appeal—the right not to litigate but to arbitrate as contracted for by the
parties—would be rendered illusory. Id. Absent mandamus relief, the party
seeking arbitration —would be deprived of the benefits of the arbitration
clause it contracted for, and the purpose of providing a rapid, inexpensive
alternative to traditional litigation would be defeated." Id. at 272-73.
The legislature responded to the Court's request and closed the gap in
appellate jurisdiction by enacting section 51.016 of the Civil Practice and Remedies
Code, which authorizes interlocutory appeals under the FAA in suits filed after
September 1, 2009. See Act of June 19, 2009, 81st Leg., R.S., ch. 820, § 2,
2009 Tex. Gen. Laws. 2061 (codified at TEX. CIV. PRAC. & REM. CODE ANN. §
51.016 (West Supp. 2011)); CMH Homes, 340 S.W.3d at 448-49.
Santander does not dispute that section 51.016 confers a right to
prosecute an accelerated, interlocutory appeal of the trial court's order
denying the motion to compel arbitration in this case. This is not a case in
which the parties are uncertain whether the FAA applies—they have expressed
agreement on that matter.[2] And the underlying case was filed in December
2011, more than two years after section 51.016's effective date. See TEX. CIV.
PRAC. & REM. CODE ANN. § 51.016. Yet Santander does not offer any
explanation for its failure to timely appeal the trial court's order. Instead,
Santander argues that because section 51.016 uses permissive language—a party
"may" appeal a judgment or interlocutory order that would be
appealable under the FAA—its failure to exercise the appellate remedy provided
therein does not constitute a waiver of the right to challenge the trial
court's order by petition for writ of mandamus.[3] Id. Stated differently,
Santander argues that because section 51.016 does not require an interlocutory
appeal of the trial court's order as the sole means of challenging such an
order, Santander may pursue mandamus relief under Texas Supreme Court authority
predating the enactment of section 51.016. See, e.g., In re D. Wilson Constr.
Co., 196 S.W.3d 774, 780 (Tex. 2006) (orig. proceeding); Jack B. Anglin, 842
S.W.2d at 272. Thus, Santander essentially contends that a party improperly
denied arbitration may always either take an interlocutory appeal or request
mandamus relief and if it chooses mandamus, that party need not demonstrate any
case-specific reason why an appeal was not adequate. Bonner, on the other hand,
contends that because an avenue for immediate review exists through
interlocutory appeal, a party may never obtain mandamus relief.
Santander's argument relies on Hernandez v. Ebrom, a case in which the
Texas Supreme Court determined that a defendant's failure to challenge the
adequacy of an expert report by interlocutory appeal under section 51.014(a)(9)
of the Civil Practice and Remedies Code did not bar the defendant from
challenging the report by appeal from a final judgment. 289 S.W.3d 316, 318-19
(Tex. 2009); see TEX. CIV. PRAC. & REM. CODE ANN. § 51.014(a)(9) (West
Supp. 2011) (authorizing interlocutory appeal of orders denying all or part of
challenge to expert reports in health-care-liability claims). The Court
reasoned, "The Legislature authorized health care providers to pursue
interlocutory appeals from trial court denials of challenges to plaintiffs'
expert reports, but we see no indication that the Legislature effectively
mandated interlocutory appeals by providing that if no appeal was taken, then
the health care provider waived the right to challenge the report under all
circumstances." Id. at 319. While Hernandez supports Santander's assertion
that a challenge to the trial court's denial of arbitration under the FAA is
not waived by Santander's failure to pursue an interlocutory appeal, Hernandez
does not clarify whether Santander may have immediate review of its challenge
by petition for writ of mandamus. Hernandez merely protects Santander's right
to assert his complaint at some later time, specifically, on appeal from a
final judgment.[4] See id.
In the cases cited by Santander, which predate section 51.016's
enactment, the Texas Supreme Court recognized mandamus as the appropriate
remedy for the wrongful denial of motions to compel arbitration under the FAA
only because there was no alternative appellate remedy at the time. See In re
D. Wilson Constr. Co., 196 S.W.3d at 780; Jack B. Anglin, 842 S.W.2d at 272-73.
Mandamus functioned as a "statutory `gap-filler.'"[5] In re Reece,
341 S.W.3d 360, 395 (Tex. 2011) (Willett, J., dissenting).
This case, however, is distinguishable from the cases in which parties
challenging the denial of a motion to compel arbitration under the FAA were
granted mandamus relief in the past because the statutory gap with respect to
the availability of immediate appellate review no longer exists. See TEX. CIV.
PRAC. & REM. CODE ANN. § 51.016. Thus, unlike the parties seeking relief
before section 51.016's enactment, Santander had an avenue for immediate
appellate review of the trial court's order denying its motion to compel
arbitration under the FAA. See id. ("In a matter subject to the [FAA], a
person may take an appeal . . . to the court of appeals from the judgment or
interlocutory order of a district court, county court at law, or county court
under the same circumstances that an appeal from a federal district court's
order or decision would be permitted by 9 U.S.C. Section 16."); 9 U.S.C. §
16(a)(1)(C) (permitting appeals of orders denying application to compel
arbitration); see also TEX. R. APP. P. 29.3 (authorizing appellate courts to "make
any temporary orders necessary to preserve the parties' rights until
disposition of the [interlocutory] appeal. . . .").
This case could potentially raise the question of whether Santander's
petition must be categorically denied because section 51.016 would have
afforded Santander a remedy by appeal had Santander timely availed itself of
the statute, as mandamus is not ordinarily available if another remedy, though
it would have been adequate and complete, was not exercised. See In re Tex.
Dep't of Family & Protective Servs., 210 S.W.3d at 613 ("[M]andamus
will not issue when the law provides another plain, adequate, and complete
remedy."); see also In re Columbia Med. Ctr., 290 S.W.3d at 207
("Mandamus should not issue to correct grievances that may be addressed by
other remedies."). But we need not decide that issue for every future case
by announcing a rule applicable to all cases; instead we limit ourselves to the
record presented here.
The Texas Supreme Court demonstrated judicial restraint in the application
of mandamus principles in In re Texas Department of Family & Protective
Services. There, the trial court abused its discretion by failing to dismiss a
suit affecting the parent-child relationship within the statutory deadline. 210
S.W.3d at 613; see also TEX. FAM. CODE ANN. § 263.401(a) (West 2011)
("Unless the court has commenced the trial on the merits or granted an
extension . . ., on the first Monday after the first anniversary of the date
the court rendered a temporary order appointing the department as temporary
managing conservator, the court shall dismiss the suit affecting the
parent-child relationship. . . ."). The Court, after acknowledging the
special need for accelerated disposition of cases involving child custody,
concluded that, nevertheless, mandamus was not available because "an
accelerated appeal provided an adequate remedy." In re Tex. Dep't of
Family & Protective Servs., 210 S.W.3d at 613-14. The Court made clear that
the scope of its holding was narrow, declining to foreclose mandamus relief
from a trial court's failure to dismiss a SAPCR within the statutory deadline
in all cases and stating that, "under the facts of this case, [the Court
cannot] conclude that an accelerated appeal was not an adequate remedy."
Following the Court's cautious approach in In re Texas Department of
Family & Protective Services, we decline to announce a broad rule applying
in all cases. Rather than state a blanket rule that mandamus is never available
when a party does not take an interlocutory appeal from an order denying a
motion to compel arbitration under the FAA (as suggested by Bonner and as the
concurrence would hold), we conclude that judicial restraint requires us to
consider only the circumstances presented by this case and to make a narrow
holding that Santander has not demonstrated its entitlement to the writ
here.[6]
First, Santander has not demonstrated that a timely filed, accelerated
appeal would not have afforded it a complete and adequate remedy. It is
unnecessary to determine whether, by creating an avenue of appeal under section
51.016, the Legislature has by implication negated one of the elements of
obtaining mandamus relief (no adequate remedy by appeal) in other cases.[7] It
is sufficient here to decide that under the facts of this case Santander has
not demonstrated that the benefits of proceeding by mandamus outweigh the
detriments. See In re Prudential, 148 S.W.3d at 136 (requiring "careful
balance" of "jurisdprudential concerns" in determining whether
"any benefits to mandamus review are outweighed by the detriments").
Prudential provides that the requirement of an "adequate" remedy on
appeal is not subject to simple categories or bright-line rules and instead
"is simply a proxy for the careful balance of jurisprudential
proceedings to review the actions of lower courts." Id. The test "is
practical and prudential." Id. A complete analysis of the adequacy of
appellate remedies requires consideration of the degree to which
"important substantive and procedural rights" are subject to
"impairment or loss" as one of the factors affecting the adequacy of
appeal,[8] none of which is discussed by Santander.
Without briefing on the benefits and detriments of mandamus review, we
conclude that it would be unnecessary and advisory to announce a bright-line
rule that a party who fails to exercise its statutory remedy of interlocutory
appeal has an adequate remedy in every circumstance.[9] We therefore refuse to
speculate on whether a remedy that in fact existed through interlocutory
appeal, but was not exercised, is always "adequate." Furthermore, it
is unnecessary for us to decide whether practical or prudential concerns
countenance ever permitting a party to proceed in an original proceeding or
whether the balancing of such concerns would only create an impermissible
end-run around the rules for filing interlocutory appeals. See, e.g., TEX. R.
APP. P. 26.1(b) (requiring notice of accelerated appeal to be filed within
twenty days after the judgment or order is signed). Nor will we speculate
whether any exceptional circumstances exist here that would excuse Santander's
failure to pursue an interlocutory appeal or otherwise warrant the issuance of
mandamus relief in this case.
In refusing to engage in such speculation—without the benefit of any
briefing pertinent to the issue—we are not, as our concurring colleague
suggests, expressing an opinion that there could be circumstances under which
section 51.016 might fail to provide a complete remedy. We merely decline to
give an advisory opinion on that issue in this case. We conclude instead that
Santander has not carried its burden to establish the inadequacy of its
remedies on appeal, and therefore it has not established its entitlement to
mandamus relief. See In re Reece, 341 S.W.3d at 374 (observing that mandamus is
extraordinary remedy issued not as matter of right but at court's
discretion).[10]
Having concluded that Santander has not established its entitlement to
mandamus relief, we deny the petition. All outstanding motions are overruled as
adequate remedy,
Trial court's order permitting arbitration-related discovery not reviewable by interlocutory appeal
Texas Court of Appeals in El Paso dismisses attempted
appeal from order that postponed ruling on arbitrability pending arbitration-related
discovery as unappealable by interlocutory appeal given that the order did not
effectively deny arbitration and did not fit any of the categories of
arbitration-related orders for which statute authorizes an immediate complaint
to the appellate courts by an aggrieved party. ReadyOne Industries, Inc. v. Simental (Tex.App.- El Paso, Dec. 21, 2012) OPINION BY JUSTICE ANTCLIFF
In this non-subscriber negligence case, ReadyOne Industries, Inc. brings
an interlocutory appeal from the trial court's order permitting
arbitration-related discovery.[1]
Because the trial court did not rule on the merits of ReadyOne's motion to
compel arbitration, but rather expressly postponed its ruling on the motion
until after the discovery it had ordered was completed, we dismiss the appeal
for want of jurisdiction.
Alleging that she sustained an on-the-job injury, Margarita Simental sued
ReadyOne for negligence. After filing an answer, ReadyOne moved to compel
arbitration pursuant to an agreement requiring claims of on-the-job injuries to
be submitted to binding arbitration. In response, Simental moved for limited
discovery on the issue of arbitrability to "develop [her] case, and defend
against [ReadyOne's] contentions that a valid arbitration agreement exists[,] .
. . [and]. . . to develop or inquire into any factual issues that may preclude
or discredit the existence of a valid arbitration agreement."
At the hearing on these matters, Simental argued that because her
affidavit, attached to the response to ReadyOne's motion to compel arbitration,
raised concerns about fraudulent inducement and no meeting of the minds,
discovery on the validity of the arbitration agreement was required.[2]
Simental also argued that her claims against ReadyOne are not arbitrable
because the Franken Amendment[3] prevents federal contractors from enforcing
agreements to arbitrate tort claims related to or arising out of negligent
hiring, supervision, or retention.[4] After considering the parties' arguments,
the trial court ordered limited discovery on the applicability of the Franken
Amendment and on Simental's claims of fraudulent inducement and no meeting of
the minds. In its order, the trial court made clear that "[it] has not
provided a final ruling on Defendant's Motion to Compel Arbitration and will
not provide such ruling until . . . the . . . discovery [ordered] should be
ReadyOne contends that the trial court's order is reviewable by
interlocutory appeal pursuant to Section 51.016 of the Texas Civil Practice and
Remedies Code. See TEX.CIV.PRAC.&REM.CODE ANN. § 51.016 (West Supp.
2012). Simental, on the other hand, argues that ReadyOne cannot bring an
interlocutory appeal of the trial court's order under Section 51.016 because
the trial court did not rule on the merits of ReadyOne's motion to compel
arbitration. We agree.
Appellate courts have
jurisdiction over interlocutory orders permitted by statute. See
TEX.CIV.PRAC.&REM.CODE ANN. §§ 51.012 and 51.014 (West Supp. 2012). We
strictly construe such statutes because interlocutory orders are a narrow
exception to the general rule that interlocutory orders are not immediately appealable.
CMH Homes v. Perez, 340 S.W.3d 444, 447-48 (Tex. 2011); Nazareth Hall Nursing
Ctr. v. Castro, 374 S.W.3d 590, 593 (Tex.App.-El Paso 2012, no pet.); Lucchese,
Inc. v. Solano, 08-11-00101-CV, 2012 WL 2409659, *2 (Tex.App.-El Paso 2012, no
593; Solano, 2012 WL 2409659, at *3; Texas La Fiesta Auto Sales, LLC v. Belk,
349 S.W.3d 872, 878 (Tex.App.-Houston [14th Dist.] 2011, no pet.). When a party
Assoc., Inc., 329 S.W.3d 58, 63 (Tex.App.-El Paso 2010, no pet.) (quotation
Section 51.016 of the Texas Civil Practice and Remedies Code provides
that in a matter subject to the Federal Arbitration Act (FAA), a party may
appeal from an interlocutory order of a district court "under the same
circumstances that an appeal from a federal district court's order . . . would
be permitted by 9 U.S.C. Section 16." TEX.CIV.PRAC.&REM.CODE ANN. §
51.016 (West Supp. 2012). Section 16 of the FAA identifies the types of orders
from which an appeal may be taken. Pursuant to Section 16, an appeal may be
(B) denying a petition under section 4 of this title to order
arbitration to proceed,
(C) denying an application under section 206 of this title to compel
(2) an interlocutory order granting, continuing, or modifying an
injunction against an arbitration that is subject to this title; or
(3) a final decision with respect to an arbitration that is subject to
9 U.S.C.A. § 16(a)(West 2009).
When strictly construed, Section 51.016 of the Texas Civil Practice and
Remedies Code does not permit an interlocutory appeal from a trial court's
order deferring ruling on a motion to compel arbitration. As established above,
Section 16 of the FAA refers only to orders denying an application to compel
arbitration and not to orders postponing a ruling on a motion to compel
arbitration. See 9 U.S.C.A. § 16 (no express provision authorizing
appeal from trial court's postponement of ruling on a motion to compel
arbitration under the FAA). Accordingly, an order deferring a ruling on a
motion to compel arbitration is not appealable under Section 16. Because such
an order is not appealable under the FAA, it is not an appealable order under
Section 51.016. See TEX.CIV.PRAC.&REM.CODE ANN. § 51.016 (in matters
subject to the FAA, an appeal is available only under the same circumstances
that an appeal from federal district court's order would be permitted). We
therefore conclude that the trial court's order permitting arbitration-related
discovery is not reviewable by interlocutory appeal.
ReadyOne argues that Section 16 "allow[s] an interlocutory appeal
from a district court order that postpones a ruling on a motion to compel
arbitration pending further discovery." In support of its argument,
ReadyOne points us to several decisions from various intermediate federal
appellate courts that stand for the proposition that if the substance of the
order effectively denies a motion to compel arbitration, it is an appealable
order under Section 16, even if the order does not determine conclusively
whether the dispute should be referred to an arbitrator. [5] Although we may
rely on decisions from intermediate federal appellate courts as persuasive
authority, we are not persuaded by those relied upon by ReadyOne. See Penrod
Drilling Corp. v. Williams, 868 S.W.2d 294, 296 (Tex. 1993)(stating that
opinions from any federal or state court may be relied on a persuasive
authority, but Texas appellate courts are obligated to follow only higher Texas
courts and the United States Supreme Court). Here, unlike in the cases on which
ReadyOne relies, the substance of the trial court's order did not effectively
deny ReadyOne's motion to compel arbitration. Moreover, our sister court
considered this identical issue in In re F.C. Holdings, Inc. and held
that, "[r]egardless of whether arbitration is sought under the [FAA] or
the Texas Arbitration Act, appeal is not available when a trial court defers
ruling on a motion to compel arbitration." 349 S.W.3d 811, 815
(Tex.App.-Tyler 2011, orig. proceeding)(citations omitted). We are thus more
persuaded by our reasoning and that of our sister court in In re F.C.
Holdings, Inc. than by the reasoning of the federal appeals courts in the
cases relied upon by ReadyOne.
Because the trial court's order permitting arbitration-related discovery
and deferring ruling on ReadyOne's motion to compel arbitration is not an
appealable order under Section 16 of the FAA, and thus, is not an appealable
order under Section 51.016 of the Texas Civil Practice and Remedies Code, we do
not have jurisdiction to consider ReadyOne's appeal. Accordingly, we dismiss
the appeal for want of jurisdiction.
[1] ReadyOne also filed a companion petition for writ of mandamus
seeking to compel the trial court to vacate its order.
[2] Simental's response to ReadyOne's motion to compel arbitration is
not in the record. However, there is no doubt that ReadyOne was aware of its
existence. At the hearing, counsel for ReadyOne acknowledged receiving Simental's
response that day and, despite receiving it then, argued that Simental's
affidavit was insufficient to require discovery on the issues of fraudulent
inducement and no meeting of the minds. In any event, neither party complains
about the absence of the response from the record, and more importantly, the
response is unnecessary for the resolution of this appeal.
[3] Section 8116 of the Department of Defense Appropriations Act of 2010
is known as the Franken Amendment because of its author, Senator Al Franken of
"Saturday Night Live" fame.
[4] Counsel for Simental informed the trial court that he had briefed
this issue in the response to ReadyOne's motion to compel arbitration. As noted
above in footnote two, the response is not in the record.
[5] See, e.g., Madol v.
Dan Nelson Auto. Grp., 372 F.3d 997, 998-99 (8th Cir. 2004)(concluding that the
district court's order that did not determine conclusively whether the dispute
should be referred to an arbitrator, but rather rejected the magistrate judge's
order compelling arbitration, stayed proceedings, and reopened discovery, was
an appealable order under Section 16 because the order refused a stay and
directed that the litigation proceed); Boomer v. AT&T Corp., 309 F.3d 404,
411-12 (7th Cir. 2002)(concluding that the district court's order explicitly
denying a motion to compel arbitration was immediately appealable under Section
16, notwithstanding the issuance of a subsequent minute order directing the
parties to confer and advise it regarding whether a separate trial on
arbitrability of the claims was warranted).
interlocutory appeal dismissed
[image: Fountain Place Tower with American flag in foreground] May 8, 2015, 12:57 a.m. 2 years ago
Lack of Consideration argument with respect to arb...
Effect of interlocutory appeal on case pending the...
Exceptions to deadline for appealing denial of mot...
Trial court order compelling arbitration not immed...
When should a motion to compel arbitration be gran...
Undue delay renders mandamus relief unavailable
What happens to additional parties in the same law...
Trial court judge strayed beyond the gateway area ...
Don’t miss the deadline for interlocutory appeal, ...
Trial court's order permitting arbitration-related...