Court Opinion

ID: 5117912
Source: CourtListenerOpinion
Date Created: 2021-10-13 06:14:49.402533+00
Date Added: 2024-06-11T08:22:04.814770
License: Public Domain

AFFIRMED and Opinion Filed October 11, 2021

                                    S  In The
                             Court of Appeals
                      Fifth District of Texas at Dallas
                                No. 05-20-01116-CV

                   SQUARE 9 SOFTWORKS INC., Appellant
                                 V.
                     SIPS CONSULTS CORP., Appellee

                On Appeal from the 101st Judicial District Court
                             Dallas County, Texas
                     Trial Court Cause No. DC-19-09337

                         MEMORANDUM OPINION
                Before Justices Osborne, Pedersen, III, and Reichek
                            Opinion by Justice Reichek
       Square 9 Softworks Inc. brings this interlocutory appeal challenging the trial

court’s order denying both its special appearance and its motion to compel

arbitration. We affirm the trial court’s order.

       SIPS Consults Corp. filed a third-party petition alleging claims against

Square 9 and others arising out of two contracts for software installation and training

services to be performed by Square 9. In response, Square 9 filed an unverified

special appearance and motion to compel arbitration. As support for the special

appearance and motion to compel, Square 9 attached a sworn declaration signed by

Square 9’s senior vice president, Michael Frattini, copies of Square 9’s contracts
with SIPS, and an unsigned “Professional Services Management Agreement”

containing an arbitration provision. SIPS filed objections to Frattini’s declaration

and the PSMA contending the declaration was irrelevant and conclusory and the

PSMA was hearsay and lacked both authenticity and relevance. Square 9 later filed

an unsworn declaration by Frattini in which he stated only that a man SIPS alleged

to be an agent of Square 9 had “never been an employee or authorized agent” of

Square 9.

      Following a hearing, the trial court signed an order granting SIPS’s

evidentiary objections and struck Frattini’s sworn declaration and the PSMA from

the record. The court additionally denied Square 9’s special appearance and its

motion to compel arbitration. Square 9 then brought this appeal.

      In its first issue, Square 9 contends the trial court erred in denying its special

appearance because SIPS failed to plead sufficient jurisdictional facts and “Square

9 could, and did, meet its burden to negate all bases of jurisdiction by proving that

it does not reside in Texas.” It is well settled that, absent sufficient jurisdictional

allegations, a defendant may defeat jurisdiction simply by proving it is not a Texas

resident. See Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653, 658 (Tex. 2010);

Hotel Partners v. KPMG Peat Marwick, 847 S.W.2d 630, 634 (Tex. App.—Dallas

1993, writ denied) (without jurisdictional allegations by plaintiff, defendant can

negate jurisdiction by presenting evidence it is non-resident). The defendant can

meet this burden by filing an affidavit testifying to its non-residency. See Touradji

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v. Beach Capital P’ship, L.P., 316 S.W.3d 15, 25 (Tex. App.—Houston [1st Dist.]

2020, no pet.) (citing Kelly, 301 S.W.3d at 659). In this case, however, even if we

assume SIPS failed to plead sufficient jurisdictional facts, the only evidence

submitted by Square 9 to prove it was not a Texas resident, and the only evidence it

points to on appeal, is the sworn declaration signed by Frattini that was struck in its

entirety from the record by the trial court.

      Square 9 does not challenge the trial court’s striking of the sworn declaration.

Accordingly, we cannot consider the declaration as part of the evidence to be

considered on appeal. See Walker v. Schion, 420 S.W.3d 454, 457-58 (Tex. App.—

Houston [14th Dist.] 2014, no pet.) (evidentiary ruling must be challenged even in

de novo review); Stone v. Midland Multifamily Equity REIT, 334 S.W.3d 371, 378

(Tex. App.—Dallas 2011, no pet.); Phillips v. Am. Elastomer Prods., L.L.C., 316

S.W.3d 181, 190 (Tex. App.—Houston [14th Dist.] 2010, pet. denied). Neither does

Square 9 provide any argument to show how it could have met its burden to prove

non-residency without the evidence that was struck. Because Square 9 has failed to

show how it met its burden of proof, we cannot conclude the trial court erred in

denying Square 9’s special appearance. We resolve Square 9’s first issue against it.

      Square 9’s second issue is similarly burdened by a lack of evidence. Square

9 contends the trial court abused its discretion by denying its motion to compel

arbitration. The arbitration provision Square 9 relies upon was contained in the

unsigned PSMA submitted as an exhibit to its motion to compel. Square 9 argues

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that SIPS agreed to the terms of the PSMA because the document was included as a

hyperlink in the signed contracts between the parties. SIPS objected to the PSMA

submitted as evidence by Square 9, contending there was no showing the document

accurately reflected the terms of the PSMA on the dates SIPS and Square 9 entered

into the software installation agreements. The PSMA was subsequently struck by

the trial court and Square 9 does not challenge that ruling on appeal.

      Because the trial court struck the PSMA, there is no evidence in the record

that the contracts signed by SIPS incorporated an arbitration provision or the scope

of any such provision. Because there is no evidence SIPS agreed to arbitrate its

claims against Square 9, the trial court did not err in denying Square 9’s motion to

compel. See In re Sthran, 327 S.W.3d 839, 843 (Tex. App.—Dallas 2010, orig.

proceeding) (party seeking to compel arbitration has initial burden to establish

arbitration agreement’s existence). We resolve Square 9’s second issue against it.

      We affirm the trial court’s order.

                                             /Amanda L. Reichek/
                                             AMANDA L. REICHEK
                                             JUSTICE

201116f.p05

                                           –4–
                                   S
                            Court of Appeals
                     Fifth District of Texas at Dallas
                                 JUDGMENT

SQUARE 9 SOFTWORKS INC.,                     On Appeal from the 101st Judicial
Appellant                                    District Court, Dallas County, Texas
                                             Trial Court Cause No. DC-19-09337.
No. 05-20-01116-CV          V.               Opinion delivered by Justice
                                             Reichek. Justices Osborne and
SIPS CONSULTS CORP., Appellee                Pedersen, III participating.

       In accordance with this Court’s opinion of this date, the December 9, 2020
order of the trial court denying the special appearance and motion to compel
arbitration of SQUARE 9 SOFTWORKS INC. is AFFIRMED.

       It is ORDERED that appellee SIPS CONSULTS CORP. recover its costs of
this appeal from appellant SQUARE 9 SOFTWORKS INC.

Judgment entered October 11, 2021

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