Opinion ID: 2828999
Heading Depth: 1
Heading Rank: 2

Heading: The Court’s holding conflicts with the majority of courts to examine the issue.

Text: The TAA requires Texas courts to construe the act to “effect its purpose and make uniform the construction of other states’ law applicable to an arbitration.” Tex. Civ. Prac. & Rem. Code § 171.003. Section 171.098 is identical to section 19 of the Uniform Arbitration Act, so we look not only to Texas cases but also to those from courts in other states that have adopted section 19. Compare id . § 171.098(a), with Unif. Arbitration Act § 19, 7 U.L.A. 739 (1956). The majority of Texas courts of appeals that have considered the issue have concluded that an order denying confirmation of an award, while also vacating and directing a rehearing, is not appealable. See Thrivent Fin. for Lutherans v. Brock , 251 S.W.3d 621, 627 (Tex. App.—Houston [1st Dist.] 2007, no pet.); Prudential Sec., Inc. v. Vondergoltz , 14 S.W.3d 329, 331 (Tex. App.—Houston [14th Dist.] 2000, no pet.). But see 209 S.W.3d 888, 895. This is the identical conclusion reached by the state supreme courts that have considered the question. See, e.g., Me. Dep't of Transp. v. Me. State Employees Ass'n , 581 A.2d 813, 815 (Me. 1990) (stating that “[t]o allow a party to appeal before the rehearing by simply filing a motion to confirm, a motion that would be denied by the court in conjunction with its order vacating the award and directing a rehearing, would be to circumvent [provisions equivalent to TAA (a)(5)]”); Karcher Firestopping v. Meadow Valley Contractors, Inc. , 204 P.3d 1262, 1265-66 (Nev. 2009) (holding that such an order is not “sufficiently final to be suitable for appellate review”); Double Diamond Constr. v. Farmers Coop. Elevator Ass’n of Beresford , 656 N.W.2d 744, 746 (S.D. 2003) (noting that the language “without directing a rehearing” in the Nebraska statute is “meaningful and not superfluous” (internal quotations omitted)). Intermediate appellate courts in other UAA jurisdictions have come to the same conclusion. See, e.g., Connerton, Ray & Simon v. Simon , 791 A.2d 86, 88 (D.C. 2002) (holding that “[w]hen it is apparent that an order confirming or denying confirmation of an arbitration award does not represent the conclusion of the proceeding on the merits, it lacks the quality of finality . . . and is not appealable”); Kowler Assocs. v. Ross , 544 N.W.2d 800, 802 (Minn. Ct. App. 1996) (ruling that “when a rehearing is directed, appellate review is premature because the arbitration process has not been completed”) . The Nevada Supreme Court examined the caselaw on both sides of the issue and held: [W]e find the decisions concluding that appellate courts lack jurisdiction to review orders denying confirmation of an arbitration award and vacating the award while directing a rehearing better reasoned and more persuasive. In particular, we agree with the various courts that have concluded that the plain language of their version of [the UAA], which provides for an appeal from orders vacating an arbitration award without directing a rehearing, bars appellate review of orders vacating an award while directing a rehearing, even if the order also denies confirmation of the award, which, on its own, would be appealable under a statute analogous to [the UAA]. As noted in these decisions, because in this matter the district court directed a rehearing, permitting appellate review at this point would render [the UAA’s] “without directing a rehearing” language superfluous. Further, we agree with the conclusion reached by several courts that the statutory structure providing for appeals from arbitration-related orders, when read as a whole, is designed to permit appeals only from orders that bring an element of finality to the arbitration process. Here, the district court's order vacating the arbitration award and remanding for supplemental proceedings extended, rather than concluded, the arbitration process, and has not been identified by [the UAA] as sufficiently final to be suitable for appellate review. Accordingly, finding no statutory basis for an appeal from the district court order, we conclude that this court lacks jurisdiction over this appeal. Karcher , 204 P.3d at 1265-66. The Court asserts that “jurisdictions, other than Texas, that have considered whether to allow appeal in a situation like the one in this case appear about evenly divided on the issue,” ___ S.W.3d at ___, but the case law in fact leans the other way. See Stephen K. Huber, State Regulation of Arbitration Proceedings: Judicial Review of Arbitration Awards by State Courts , 10 Cardozo J. Conflict Resol . 509, 576 (2009) (noting that states may require re-arbitration with an appeal of the initial order awaiting completion of the arbitration process and observing that “most states have in fact adopted precisely this approach”). Of the cases enumerated by the Court, almost all are distinguishable and most were decided a decade or more ago. The Court’s reliance on a New York case, In re Baar & Beards, Inc. , is beside the point, because New York has no statute governing appeals in arbitration cases. The court in Baar turned to state common law to resolve the issue, and its analysis is therefore inapplicable for our purposes. See In re Baar & Beards, Inc. , 282 N.E.2d 624, 625 (N.Y. 1972). The Arizona and Missouri cases are also inapposite because both of those states, by statute, authorize general appeals from orders granting new trials, which is not so in Texas. Compare Fruehauf Corp. v. Carrillo , 848 S.W.2d 83, 84 (Tex. 1993) (“An order granting a new trial is an unappealable, interlocutory order.”), with Wages v. Smith Barney Harris Upham & Co. , 937 P.2d 715, 719 (Ariz. Ct. App. 1997), and Nat’l Ave. Bldg. Co. v. Stewart , 910 S.W.2d 334, 338 (Mo. Ct. App. 1995) (noting that Missouri practice is distinguishable because “[The Missouri statute] specifically authorizes an appeal ‘from any order granting a new trial’ in any civil case”). Furthermore, as noted by the Court, Missouri case law has in fact come out both ways. See, e.g. , Crack Team USA, Inc. v. Am. Arbitration Ass’n , 128 S.W.3d 580, 583 (Mo. Ct. App. 2004) (dismissing appeal). Although the Court cites a Massachusetts case that appears to allow an appeal from an order that denies confirmation and directs a rehearing, the case never discusses the nature of the interlocutory order, or the authority on which it grants the appeal. See Fazio v. Employers’ Liab. Assurance Corp. , 197 N.E.2d 598, 600 (Mass. 1964). More recent Massachusetts decisions have directly addressed the issue of orders to vacate with a rehearing (without denying confirmation), and have denied the right of appeal—without even citing Fazio . See Suffolk County Sheriff's Dep't v. AFSCME Council 93 , 737 N.E.2d 1276, 1277 (Mass. App. Ct. 2000) (holding that the ordering of a rehearing caused the judgment to not be final and appealable); School Comm. of Quincy v. Quincy Educ. Ass’n , 491 N.E.2d 672, 673-74 (Mass. App. Ct. 1986) (“Since the order was one which contemplated a further hearing, it was not appealable.”). The Court also points to a recent Utah court of appeals decision allowing for appeal. However, in that case, the court was required to do so because of state precedent interpreting the Utah constitutional provision authorizing appeals, not because the UAA mandated such a result. See Hicks v. UBS Fin. Servs . , Inc. , No. 20080950-CA, 2010 Utah App. LEXIS 20, at - (Utah Ct. App. Feb. 4, 2010) (noting that a “majority” of courts have dismissed such appeals, while a “minority” have allowed them). A few cases do, in fact, support the Court’s interpretation: an unpublished appellate case out of Tennessee, which provides no jurisdictional analysis, Boyle v. Thomas , No. 02A01-9601-CV-00022, 1997 Tenn. App. LEXIS 807, at  (Tenn. Ct. App. Nov. 14, 1997); and a Minnesota decision which, as noted by the Court, ___ S.W.3d at ___, is one of two Minnesota cases that come to opposite conclusions: one permitting appeal without discussing jurisdiction, Safeco Ins. Co. v. Goldenberg , 435 N.W.2d 616, 621 (Minn. Ct. App. 1989), and the other disallowing appeal because it “would be inconsistent with the rules of statutory interpretation and the statutory prohibition against appeals from orders directing a rehearing,” Kowler , 544 N.W.2d at 801 . Thus, it is accurate to say that the majority of states that have arbitration statutes comparable to ours have concluded that there is no appeal from an order that vacates an award, directs a rehearing, and denies confirmation. Even more compelling is the fact that every other Texas appellate decision concerning this issue, with the exception of the court of appeals’ opinion in this case, has interpreted it the same way. See Thrivent , 251 S.W.3d at 627; Stolhandske v. Stern , 14 S.W.3d 810, 813 (Tex. App.—Houston [1st Dist.] 2000, pet. denied); Vondergoltz , 14 S.W.3d at 331. The TAA directs us to construe its provisions so as to “make uniform the construction of other states’ law applicable to an arbitration”; we come closer to that mandate by holding that an interlocutory order that directs a rehearing may not be appealed.