Court Opinion

ID: 3089861
Source: CourtListenerOpinion
Date Created: 2015-10-16 03:51:27.809651+00
Date Added: 2024-06-11T11:50:56.858516
License: Public Domain

NUMBER 13-12-00166-CV

                           COURT OF APPEALS

                THIRTEENTH DISTRICT OF TEXAS

                   CORPUS CHRISTI – EDINBURG

EDWARD D. JONES, L.P.,                                                   Appellants,
GEOFFERY L. HALL AND AMY S. HALL,

                                          v.

EVERARDO VILLAREAL,                                                        Appellee.

              On appeal from the County Court of Law No. 7
                       of Hidalgo County, Texas.

                        MEMORANDUM OPINION
    Before Chief Justice Valdez and Justices Rodriguez and Garza
               Memorandum Opinion by Justice Garza

      This is an interlocutory appeal from the trial court’s order denying the motion of

appellant, Edward D. Jones, L.P. (“Edward Jones”), to compel arbitration under the
Federal Arbitration Act (“FAA”). See TEX. CIV. PRAC. & REM. CODE ANN. § 51.016 (West

Supp. 2011); 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.”). Appellants, Geoffrey L. Hall (“Hall”) and

Amy S. Hall, also appeal from the trial court’s order. By five issues, appellants contend

the trial court erred in: (1) denying their motion to compel arbitration because Edward

Jones and appellee, Everardo Villareal,1 agreed to arbitration under the FAA; (2) finding

that Villareal’s claims were outside the scope of the arbitration agreement; (3) finding

that the agreement containing the arbitration clause was a unilateral agreement; (4)

finding that Villareal’s claims can be enforced without reference to the agreement; and

(5) finding that Edward Jones waived its right to compel arbitration. Because Villareal’s

claims do not fall within the scope of the arbitration agreement and can be enforced

without reference to the agreement, the trial court did not err in refusing to compel

arbitration, and we affirm the trial court’s order.

                                           I. BACKGROUND

        On March 2008, Villareal and his wife, Ruth, opened a brokerage account with

Hall, then a financial advisor with Edward Jones.                    The Edward Jones account

agreement (“the Agreement”) contains an arbitration provision. Pursuant to opening the

account, Villareal and Ruth signed an Edward Jones Account Authorization and

Acknowledgment Form, which contained the following statement referencing the

arbitration provision:        “The Edward Jones Account Agreement and Disclosure

        1
           We note that, throughout the record, appellee’s surname is spelled variously as “Villareal” and
“Villarreal.” We use the spelling that appears below appellee’s signature on documents in the record.

                                                    2
Statement contains, on page 19, paragraph 1, a binding arbitration provision which may

be enforced by the parties.” The Agreement on page 19, states, in relevant part:

      This Agreement contains a predispute arbitration clause. By signing an
      arbitration agreement the parties agree as follows:

      1. All parties to this Agreement are giving up the right to sue each other in
         court, including the right to a trial by jury, except as provided by the
         rules of the arbitration forum in which a claim is filed.

             ....

      Any controversy arising out of or relating to any of my accounts or
      transactions with you, your officers, directors, agents, and/or employees
      for me, to this Agreement, or to the breach thereof, or relating to
      transactions or accounts maintained by me with any of your predecessor
      or successor firms by merger, acquisition or other business combinations
      from the inception of such accounts shall be settled by arbitration in
      accordance with the rules then in effect of the Board of Directors of the
      New York Stock Exchange, Inc. or the National Association of Securities
      Dealers, Inc. as I may elect.

      Almost a year later, on February 25, 2009, Villareal loaned Hall $52,850 and Hall,

in exchange, signed a promissory note. The promissory note is typewritten on plain

paper with no letterhead. The note does not mention Edward Jones or reflect that

Edward Jones is a party to the note. The note states:

      Geoffrey L. Hall, “MAKER,” agrees to pay to Everardo Villareal,
      “HOLDER,” the sum of $52,850.00 (fifty-two thousand eight-hundred fifty
      and no/100s Dollars), at 3601 North Bryan Road, Mission, Texas, with
      interest thereon from the date any portion is advanced to MAKER, at the
      rate of eight percent (8%) per annum, simple interest.

      A full payment of all principal outstanding plus interest accrued thereon
      will be payable on December 31, 2010. This note may be paid in whole or
      in part prior to maturity. Payments shall be applied first to accrued
      interest, with the balance of payment applied to outstanding principal.

      This note is payable in U.S. Dollars. At any time the maximum rate of
      interest applicable to this transaction shall not exceed the legal maximum
      rate of interest for a note of this type. Any sums paid in excess of any

                                           3
       lawful limitation shall be applied to principal. This note and amounts due
       hereunder are not assignable.

       After default herein, this note will bear interest at the highest legal rate for
       this type of note until paid in full. Upon any default, MAKER agrees to pay
       a reasonable attorney’s fee for any and all services of an attorney,
       whether in or out of court, and for appeal and post-judgment collection
       legal services.

The note is signed by both parties.

       Hall allegedly failed to repay Villareal pursuant to the note.              Accordingly, on

January 19, 2011, Villareal sued the Halls and Edward Jones, alleging breach of

contract, fraud, conversion, and theft. Villareal filed an amended petition on May 25,

2011. On June 15, 2011, Edward Jones filed an answer, subject to its right to compel

Villareal’s claims to arbitration. On August 15, 2011, Edward Jones filed its motion to

compel arbitration.2 On January 23, 2012 and February 1, 2012, the trial court held a

hearing on the motion to compel. Edward Jones presented the testimony of Eva Mullis,

an Edward Jones financial advisor that succeeded Hall. The Halls presented Hall’s

testimony.

       At the conclusion of the hearing, the trial court denied the motion to compel

arbitration. On February 28, 2012, the trial court signed an order denying the motion,

which contained the following “findings”:3

       1. The Promissory Note which is the subject of Plaintiff’s cause of action
          does not contain an arbitration agreement within it’s [sic] four corners;

       2. The Promissory Note which is the subject of Plaintiff’s cause of action
          is clear and unambiguous.

       2
           The Halls joined in Edward Jones’s motion to compel arbitration.
       3
         We note that only “finding” number one is a finding of fact; “findings” two through seven are
conclusions of law, which we review de novo. In re Labatt Food Serv., L.P., 279 S.W.3d 640, 643 (Tex.
2009).

                                                     4
      3. As presented, the Securities Account Agreement, which Defendant,
         Edward D. Jones, relies upon on [in its] Motion to Compel Arbitration
         and Stay all Proceedings[,] is a unilateral agreement[,] and there was
         no evidence presented to demonstrate a meeting of the minds, or that
         the contract was accepted by both parties to the proposed contract.

      4. The Securities Account Agreement, which Defendant, Edward D.
         Jones[,] relies upon on [in its] Motion to Compel Arbitration and Stay all
         Proceedings, contains an Arbitration clause on page 19, which clearly
         and unambiguously limits its scope to disputes arising out of the
         Securities Account Agreement.

      5. The Promissory Note and disputes arising out of said Promissory Note,
         do not fall within the scope of the The [sic] Securities Account
         Agreement, which Defendant, Edward D. Jones, relies upon on [in its]
         Motion to Compel Arbitration and Stay all Proceedings.

      6. The Promissory Note which is the subject of Plaintiff’s cause of action
         is capable of enforcement without reference to the Securities Account
         Agreement[,] which Defendant, Edward D. Jones[,] relies upon on [in
         its] Motion to Compel Arbitration and Stall all Proceedings.

      7. The Defendant has waived the right to compel arbitration by allowing
         discovery and making judicial admissions without seeking a hearing on
         a motion for protection prior to the date of the said admissions being
         made. Compelling arbitration at this stage would cause Plaintiff undue
         hardship, by forcing him to relitigate matters in arbitration that are
         settled under this cause of action.

This appeal followed.

                        II. STANDARD OF REVIEW AND APPLICABLE LAW

      “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.

                                           5
“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 Jones. “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

                                             6
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

                                            7
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. op.).

                                       III. DISCUSSION

       The issue we must resolve is whether Villareal’s claims fall within the scope of

the Agreement’s arbitration provision.

   A. Whether Claims are Outside the Scope of the Agreement

       By their second issue, appellants contend the trial court erred in finding that

Villareal’s claims are outside the scope of the Agreement. Appellants argue that the

dispute falls within the scope of the Agreement’s arbitration provision—even if the

dispute does not relate to or arise out of the Agreement for brokerage services—

because the promissory note is a “transaction” between Villareal and Hall, an Edward

Jones “agent” or “employee.” Villareal argues that the Agreement limits its scope to

disputes arising out of the Agreement, and that the dispute regarding the promissory

note does not fall within the scope of the Agreement.

       We begin by examining Villareal’s live pleading. See In re Rubiola, 334 S.W.3d

at 225. The factual allegations in Villareal’s complaint center on his allegation that

under the promissory note, Hall agreed to repay the sum of $52,850 and has failed to

do so. Specifically, Villareal alleges, in pertinent part:

     9.   On or about February 25th 2009[,] Defendants entered into a
          promissory note with the Plaintiff. The agreement, which is attached
          and incorporated herein as EXHIBIT “A”, Defendant agreed to repay the
          sum of $52,850.00 with interest by December 31st, 2010.

                                               8
   10.        Demand was made for payment on and after the date of the maturity of
              the debt. No payments have been made and Defendant has verbally
              stated that he will not pay the debt. A demand letter was sent on
              January 4th 2010 a copy of which is attached and incorporated herein
              as EXHIBIT “B”.

    12. Defendant took possession of the money from Plaintiff on the pretense
        that it was for the use of his business. Plaintiff relied on Defendant’s
        assertion that the loaned money would be used for his business which
        is part of a nation wide financial planning company.[4]

              ....

    14. Several attempts were made by Plaintiff to discuss the payment of the
        debt with Defendant. The Defendant stopped communication with the
        Plaintiff and refused to pay the debt.

    15. The Defendants have failed and refused to fulfill their obligations under
        the promissory note. Defendants materially mislead Plaintiffs [sic] into
        lending a substantial sum of money. Defendant have [sic] used the
        money intend[ed] for use by Edward Jones and utilized it for other
        business ventures and personal spending.

              ....

    31. The evidence will show that Defendant fraudulently entered into the
        agreement in question by never intending to pay the loan he secured
        from the Defendant. [sic] Defendant used the name and reputation of
        his Company, Edward Jones, to convince Plaintiff that the loan was a
        good investment. The evidence will show that the Defendant pleaded
        for more time and stated that his wife’s new business would make
        Money to cover the cost of the loan. Subsequently Defendant informed
        Plaintiff that he would not repay the loan.

         We construe the petition to allege that Hall breached the promissory note and

fraudulently represented to Villareal that the $52,850 loan would be used to further

Hall’s business as a broker with Edward Jones and was therefore a good investment,

but that Hall subsequently used the loan proceeds for other business ventures and

         4
             We note that the paragraphs in the petition are not numbered sequentially.

                                                       9
personal expenditures. The petition does not allege any acts by Edward Jones, except

insofar as Hall was acting as an agent or principal of Edward Jones.5

        To determine whether the facts alleged in the petition “touch matters covered by

the underlying arbitration agreement,” see In re Stanford Group, 273 S.W.3d at 813, we

review the services provided under the Agreement. The “General Account Provisions”

of the Agreement describes the services provided to Villareal by Edward Jones:

        Services Provided by Edward Jones Under the Terms of this
        Agreement

        I understand that the account I establish with Edward Jones pursuant to
        the terms of this Agreement is for brokerage services.          I further
        understand that you [Edward Jones] will facilitate and execute securities
        transactions on my behalf and provide custody services for my securities
        and other financial instruments. You may also provided [sic] me with
        related services and information, such as investment research, investor
        education, financial tools (including financial calculators and asset
        allocation analysis), recommendations about whether to buy, sell, or hold
        securities, as well as other information about financial products and
        services. I understand that you will not charge a separate fee for these
        services and that they are part of your brokerage services. I understand
        that your brokerage and related services do not constitute financial
        planning or any other investment advisory service.

        The facts alleged in the petition—Hall’s alleged representation that the loan was

for his business as an Edward Jones broker and was a good investment, and his failure

to pay the promissory note—do not appear to “touch matters covered by the underlying

arbitration agreement.” See id. The “recommendations” regarding buying and selling

are limited to the purchase and sale of securities.                 We have examined the entire

Agreement.        Although the Agreement envisions that Edward Jones may, at its

discretion, make loans to a customer, it does not envision or discuss the circumstances

        5
          We note that although Villareal’s brief asserts that Edward Jones is vicariously liable for Hall’s
actions because Hall was acting as Edward Jones’s agent, Villareal’s live petition makes no such
allegation. We also note that at the evidentiary hearing, Hall testified that he did not have authority to
sign documents on behalf of Edward Jones.

                                                    10
at issue here, in which a customer (Villareal) loaned money to an Edward Jones

employee or broker. Accordingly, the claims do not “arise out of,” nor are they “related

to” the Agreement.

       We turn next to the language of the arbitration provision.       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).

                                            11
       Here, appellants argue that the arbitration provision applies to “[a]ny controversy

. . . relating to any of [Plaintiff’s] accounts or transactions with [Edward Jones] . . . .”

According to appellants, “Plaintiff’s claims against Edward Jones under the promissory

note ‘relate to’ an alleged ‘transaction’ between Plaintiff and Edward Jones and

therefore, they are within the scope of the arbitration agreement.” Villareal argues that

appellants’ characterization of the arbitration provision “omit[s] the language, ‘for me, to

this Agreement, or the breach thereof,’ which limits the scope of the provision.”

According to Villareal, (1) the arbitration provision ties the arbitrable controversy “to this

Agreement,” which was for “brokerage services”; and (2) because his claim involves the

failure to pay a promissory note, which does not involve brokerage services, the claim

therefore does not fall within the scope of the Agreement. Villareal argues that, “[t]he

problem with [appellants’] argument is the subject promissory note is not a transaction

that Edward Jones offers, is not covered by the Account Agreement, and the arbitration

provision limits itself to the Account Agreement and its breach.”

       To determine whether, as appellants argue, the arbitration provision covers any

controversy relating to any transaction with any Edward Jones employee, we must

decide what the parties intended by inserting the phrase “to this Agreement.” As noted

above, we are to determine whether it is possible to enforce the Agreement as written,

and our primary concern is to ascertain the intentions of the parties as expressed in

their contract. See J.M. Davidson, 128 S.W.3d at 229. The arbitration provision states:

       Any controversy arising out of or relating to any of my accounts or
       transactions with you, your officers, directors, agents, and/or employees
       for me, to this Agreement, or to the breach thereof, . . . shall be settled by
       arbitration . . . .

                                             12
        We conclude that we cannot give the arbitration provision a definite or certain

legal meaning because it is unclear whether (1) “to this Agreement” restricts the scope

of the arbitration provision to controversies relating to Villareal’s transactions with

Edward Jones under the Agreement, or (2) “to this Agreement” is a separate

independent category of arbitrable disputes—meaning that any controversy relating to

any transaction with an Edward Jones employee (even if not a transaction under the

Agreement) is subject to arbitration. See id. We note that if the second interpretation is

proper, “or to the breach thereof” is also a separate independent category of arbitrable

disputes and should properly read, “or to the breach of this Agreement.” We hold that

the arbitration provision is subject to two or more reasonable interpretations, and is

therefore ambiguous.         See id.     Therefore, we next consider parol evidence of the

parties’ intent. See New Concept Const. Co. v. Kirbyville Consol. Indep. Sch. Dist., 119
S.W.3d 468, 470 (Tex. App.—Beaumont 2003, pet. denied) (“Only when the court finds

the contract ambiguous may the court consider parol evidence of the parties’

intentions.”) (citing Nat’l Union Fire Ins. Co. v. CBI Indus., Inc., 907 S.W.2d 517, 520

(Tex.1995)).

        At the evidentiary hearing, Eva Mullis testified that the promissory note between

Hall and Villareal was “not a normal part of the transactions” handled at Edward Jones.

She also testified that she understood the arbitration clause in the Agreement to cover

disputes arising from a client’s investments with Edward Jones.

        Hall testified that he drafted the promissory note and that it was a “completely

independent separate agreement” and not part of the Agreement. 6 He testified that he

        6
          In the promissory note, Hall agrees, in the event of default, to pay reasonable attorney’s fees
“whether in or out of court.”

                                                   13
did not have authority to sign contracts on Edward Jones’s behalf.            On cross-

examination, the following exchange occurred:

      Q [Villareal’s counsel]: When you signed that promissory note, did you
                               include it in the transactions that are under this
                               account agreement?

      A [Hall]:                No, sir.

      Q:                       Did you ever list it under the assets or debts or
                               liabilities assets of Mr. Villareal in his portfolio
                               with Edward Jones?

      A:                       Of course not.

      Q:                       Why not?

      A:                       Because it was not an asset under his Edward
                               Jones account.

      Q:                       But it was money owed to him?

      A:                       It was owed by the individual who signed the
                               promissory note which is me, personally.

                               ....

      Q:                       Is the account agreement part of the promissory
                               note?

      A:                       No, sir.

      Q:                       Okay. When you drafted the promissory note,
                               did you ever mention the account agreement to
                               Mr. Villareal?

      A:                       No, sir.

      Q:                       Did you ever tell him that the promissory note
                               was affected by the account agreement?

      A:                       No, sir.

      Q:                       Is it your opinion that the promissory note is
                               affected by the account agreement?

                                          14
A:                      I’m not—I’m not qualified to give you that. I think
                        that’s a legal—

Q:                      From your understanding since you’re the one
                        that drafted the account agreement, the
                        promissory note, I’m sorry, was it your
                        understanding that the promissory note fell under
                        the purview of the account agreement?

A:                      No, sir.

                        ....

Q:                      I’m going to have you, I believe it’s Defendant’s
                        Exhibit 1, page 19, Could you read the second
                        paragraph—the second sentence of the second
                        paragraph? Starting with “any controversy.”

A:                      Any controversy arising out of or relating to any
                        of my accounts or transactions with you, your
                        officers, directors, agents, and/or employees for
                        me, to this [A]greement, or to the breach thereof,
                        or relating to transactions or accounts
                        maintained by me with any of your predecessor
                        or successor firms by merger, acquisition or
                        other business combinations from the inception
                        of such accounts shall be settled by arbitration in
                        accordance with the rules then in effect of the
                        Board of Directors—

Q:                      That’s sufficient for our purpose right now. Right
                        there on the fourth line on that run[-]on sentence
                        of that paragraph, there is a clause. It says, “to
                        this [A]greement.” What does that mean?

[E. Jones’s counsel]:   Checked [sic] to the characterization of the
                        agreement. That’s a run[-]on sentence. He
                        wants to ask a question about the agreement—

Q:                      It grammatically is a run[-]on sentence.

[the Court]:            Overruled.

Q:                      What does it mean “to this [A]greement”?

                                     15
       A:                       Well, I think it says any complaints or
                                controversies arising out of the client’s
                                agreement with the firm.

       We conclude that Hall’s testimony established that the parties intended for the

arbitration clause to apply only to disputes arising out of or related to the Agreement.

See id.; J.M. Davidson, 128 S.W.3d at 229. Accordingly, we hold that Villareal’s claims

do not fall within the scope of the Agreement. We overrule appellants’ second issue.

   B. Whether Claims are Enforceable Without Reference to the Agreement

       By their fourth issue, appellants contend the trial court erred in finding that

Villareal’s claims can be enforced without reference to the Agreement. As noted, the

trial court specifically found that the promissory note was enforceable without reference

to the Agreement.

       “[I]f 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.”   Osornia, 367 S.W.3d at 714 n.4

(quoting AutoNation USA Corp., 105 S.W.3d at 195); Lopez, 162 S.W.3d at 810 (same);

In re Nestle USA–Bev. Div., Inc., 82 S.W.3d 767, 776 (Tex. App.—Corpus Christi 2002,

orig. proceeding) (same). Here, the facts alleged in support of Villareal’s claim—that

Hall agreed to repay $52,850.00 plus interest by December 31, 2010 and has failed to

do so—are completely independent of the Agreement and the claim can be maintained

without reference to the Agreement. We hold that the trial court did not abuse its

discretion in denying appellants’ motion to compel arbitration on the ground that

Villareal’s claims are enforceable without reference to the Agreement, and we overrule

appellants’ fourth issue.

                                           16
                                          IV. CONCLUSION

        “An order denying arbitration must be upheld if it is proper on any basis

considered by the trial court.” In re Weeks Marine, Inc., 242 S.W.3d 849, 854 (Tex.

App.—Houston [14th Dist.] 2007, orig. proceeding). We have found that two of the

bases considered by the trial court were proper. We hold that the trial court did not err

in denying appellants’ motion to compel arbitration and affirm the trial court’s judgment.7

                                                        DORI CONTRERAS GARZA,
                                                        Justice

Delivered and filed the
21st day of February, 2013.

        7
         Because we have found the trial court did not err in refusing to compel arbitration, we need not
address appellants’ remaining challenges to the trial court’s order. See TEX. R. APP. P. 47.1.

                                                   17