Court Opinion

ID: 9634264
Source: CourtListenerOpinion
Date Created: 2023-08-22 13:07:54.385263+00
Date Added: 2024-06-11T09:43:59.074208
License: Public Domain

Fourth Court of Appeals
                                      San Antonio, Texas
                                  MEMORANDUM OPINION

                                          No. 04-22-00429-CV

                                  TEXAS FIRST RENTALS, LLC,
                                           Appellant

                                                     v.

                  MONTAGE DEVELOPMENT CO., LLC and Derick Murway,
                                  Appellees

                     From the 285th Judicial District Court, Bexar County, Texas
                                  Trial Court No. 2022-CI-08101
                              Honorable Tina Torres, Judge Presiding

Opinion by:      Rebeca C. Martinez, Chief Justice

Sitting:         Rebeca C. Martinez, Chief Justice
                 Beth Watkins, Justice
                 Sandee Bryan Marion, Chief Justice (Retired) 1

Delivered and Filed: August 16, 2023

DISMISSED IN PART; AFFIRMED IN PART; REVERSED IN PART; REMANDED

           Texas First Rentals, LLC (“TFR”) appeals from an order denying its motion to compel

arbitration and from an order denying its motion for reconsideration. We hold the trial court erred

by denying TFR’s motion to compel arbitration as to its claims against Montage Development Co.,

LLC (“Montage”) related to a single rental contract. Accordingly, we reverse the trial court’s

order and remand with instructions to compel arbitration and stay proceedings as to those claims.

1
 Retired Fourth Court of Appeals Chief Justice Sandee Bryan Marion sitting by assignment. See TEX. GOV’T CODE
ANN. § 74.003.
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We otherwise affirm the trial court’s order denying TFR’s motion to compel arbitration.

Additionally, we dismiss the portion of TFR’s appeal challenging the trial court’s order denying

its motion for reconsideration because we lack jurisdiction over that part of the appeal.

                                          BACKGROUND

       On November 6, 2019, Montage submitted an “Application for Credit” with TFR, a

company which rents construction equipment. The Application lists Derick Murway as Montage’s

“owner or president,” and Murway signed the Application as Montage’s “principal” and

“managing member.” According to an Application term, Murway, by signing, recognized that his

credit history could be used as a factor in TFR’s credit evaluation.

       The Application for Credit states that Montage,

       acknowledges and agrees to the following:

       1. . . . (a) all purchases/rentals made by [Montage] from [TFR] are subject to the
       Terms and Conditions contained herein; (b) [Montage] has received, read,
       understands and accepts all of the terms and conditions of TFR’s Rental Contract;
       ....

       2. . . . Rentals by TFR to [Montage] made subsequent to the acceptance of this
       application by TFR shall be governed by the Rental Contract pertaining to such
       rental and by this Agreement. In the event that any provisions of the Rental
       Contract shall conflict with any provision of this Agreement, the Rental Contract
       shall control.

The Application does not define “Rental Contract,” and no contract is attached.

       In 2022, TFR sued Montage and Murway, alleging they failed to pay for equipment rented

in 2021. TFR asserted a breach of contract claim against Montage and filed its claim as a suit on

a sworn account. See TEX. R. CIV. P. 185. TFR also asserted a claim against both Montage and

Murway for violations of the Texas Trust Fund Act. See TEX. PROP. CODE ANN. §§ 162.001–.033.

In its breach of contract claim, TFR alleged that the amount due at the time of filing was

$48,789.63. In its Texas Trust Fund Act claim, TFR alleged that Murway, in his management

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capacity, received and controlled funds received by Montage for the use of TFR’s equipment and

that Murway failed to remit the funds to TFR. TFR attached to its petition an affidavit by Corey

Woods, its Financial Services Manager, verifying the amount it alleged was owed.

        Montage and Murway filed a motion to transfer venue and an original answer, and TFR

filed a motion to compel arbitration and to stay proceedings. Attached to TFR’s motion is an

affidavit by Woods in support. The affidavit authenticates a copy of the Application for Credit

and “true and correct cop[ies] of the Rental Agreements,” which are attached as Exhibits A-1 to

A-5. Woods avers: “The Rental Agreements contain an arbitration provision, which provides, in

part, that the parties shall submit to binding arbitration any ‘any [sic] dispute arising out of or

relating to this transaction.’”

        Attachments A-1 to A-5 of Woods’s affidavit include some or all of the following

documents: a “Rental Out,” a “Pickup Ticket,” a “4 Week Bill,” and a “Rental Invoice.” Each

exhibit, A-1 to A-5, relates to one of five specific contracts for equipment rentals:

        •       Contract 1161827—Attachment A-1 includes a Rental Invoice (1 page),

                another Rental Invoice (1 page), a Rental Out (2 pages), another Rental Out

                (1 page), a 4 Week Bill (1 page); and another 4 Week Bill (1 page).

        •       Contract 1161701—Attachment A-2 includes a Rental Invoice (1 page), and

                a Pickup Ticket (2 pages).

        •       Contract 1162465—Attachment A-3 includes a Rental Invoice (1 page), a

                Rental Out (1 page), another Rental Out (2 pages), a 4 Week Bill (1 page),

                and a Pickup Ticket (2 pages).

        •       Contract 1164701—Exhibit A-4 includes a Rental Invoice (1 page), another

                Rental Invoice (1 page), another Rental Invoice (1 page), another Rental

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                    Invoice (2 pages); a Rental Out (2 pages), another Rental Out (2 pages), a 4

                    Week Bill (1 page); another 4 Week Bill (1 page), another 4 Week Bill (1

                    page), a Pickup Ticket (2 pages), and another Pickup Ticket (2 pages).

           •        Contract 1170368—Exhibit A-5 includes a Rental Invoice (1 page), and a

                    Pickup Ticket (2 pages).

           The Rental Outs, Pickup Tickets, 4 Week Bills, and Rental Invoices include specific

contract numbers, customer information, and rental information on their first pages. Based on how

these forms have been filled out, it appears that the Rental Out form is used when TFR releases

equipment to a customer, and the Pickup Ticket form is used when equipment is returned to TFR.

The 4 Week Bill form and the Rental Invoice form reflect, respectively, installment billing and

billing after equipment has been returned. 2 At the bottom of each of the four forms is the statement:

“Conditions of Rental, Read Front & Reverse Side.” In the bullet points above, if a form is shown

as comprising two pages, then it includes a second page containing “Additional Terms and

Conditions.” This second page is identical across the four forms whenever it is included.

However, as reflected in the paragraph above, when a form is shown as comprising a single page,

it does not have a reverse side. Most of the forms are unsigned. Additionally, as reflected above,

Exhibits A-2 and A-5 do not include a Rental Out form. Moreover, some of the Rental Out forms

state a printing date that is after the date the equipment is listed as being delivered to Montage.

Only one of the Rental Out forms — a Rental Out form in Exhibit A-4 — is both signed and printed

on the date listed as the date the equipment was delivered.

2
    TFR’s counsel confirmed this understanding of the forms at the hearing on the motion for reconsideration:

           Now, rental invoices are invoices. Those are not rental contracts. The rental out documents
           . . . those have terms and conditions. They say a contract date, they say a contract number,
           they say additional terms of that contract. Those are the contracts we are talking about.

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       When included, the second/reverse page comprising Additional Terms and Conditions

includes the following language:

       ARBITRATION: Parties agree to submit to binding arbitration for any dispute
       arising out of or relating to this transaction. Either party may initiate arbitration
       which shall be conducted in accordance with commercial arbitration rules of the
       American Arbitration Association, in San Antonio, Bexar County, Texas. Each
       party shall bear its own costs and attorney’s fees unless the arbitrators award such
       fees to a party, each party shall share equally the cost of the arbitration.

       Montage and Murway filed a response opposing arbitration. They argued there is no

enforceable agreement to arbitrate because the “documents in place at the time of the purported

rentals that are attached to [TFR’s] Arbitration/Stay Motion do not contain an arbitration clause.”

At the hearing on TFR’s motion, Montage and Murway’s counsel stated there was no arbitration

term in the Application for Credit. As to Exhibits A-1 to A-5, counsel argued the documents do

not reflect a rental agreement because the Rental Outs, Pickup Tickets, 4 Week Bills, and Rental

Invoices were not signed and were printed after the date the equipment was released to Montage.

Montage and Murway’s counsel argued that Exhibits A-1 to A-5 reflect an unsuccessful attempt

by TFR to impose additional terms or modifications after rental contracts had been formed when

the equipment was delivered to Montage. Counsel, however, did not review all of the Rental

Agreements separately.

       The trial court denied TFR’s motion, and TFR filed a motion to reconsider, including the

same exhibits and providing new authority regarding incorporation by reference. TFR argued that

Montage agreed to arbitration when it signed the Application for Credit, which, according to TFR,

incorporated the arbitration provision within the Additional Terms and Conditions contained in

some of the forms attached as Exhibits A-1 to A-5.           At the hearing on the motion for

reconsideration, Montage and Murway’s counsel made the same arguments as previously, but this

time, he went through all five exhibits separately. Counsel argued that only the fourth contract,

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reflected in Exhibit A-4, includes a signed Rental Out form that was printed on the same date that

the equipment was released to Montage. Therefore, according to counsel, “The best they do is one

out of five,” in terms of Rental Agreements with an arbitration provision.

       The trial court denied TFR’s motion to reconsider, and TFR appealed both from the denial

of its motion to compel arbitration and from the denial of its motion for reconsideration.

                                           DISCUSSION

I. Jurisdiction

       We must first consider our jurisdiction, sua sponte. See M.O. Dental Lab v. Rape, 139

S.W.3d 671, 673 (Tex. 2004). To begin, we note that our jurisdiction determination is not

controlled by whether the Federal Arbitration Act (“FAA”), the Texas Arbitration Act (“TAA”),

or both apply; therefore, we do not resolve the matter. See Allegheny Millwork, Inc. v. Honeycutt,

No. 05-21-00113-CV, 2022 WL 2062876, at *3 n.3 (Tex. App.—Dallas June 8, 2022, pet. denied)

(mem. op.) (not resolving matter of whether FAA or TAA applies because resolution would not

affect outcome).

       TFR asserts that the Additional Terms and Conditions page, which is included on some,

but not all of the Rental Out forms, includes a binding arbitration provision. This provision does

not specify whether the Federal Arbitration Act (“FAA”) or the Texas Arbitration Act (“TAA”)

applies, and TFR has sought to enforce arbitration under both acts. The FAA and TAA are not

mutually exclusive, and the FAA only preempts the TAA in situations in which the TAA would

refuse enforcement of an arbitration agreement that the FAA would enforce. See In re D. Wilson

Constr., 196 S.W.3d 774, 779 (Tex. 2006); see also In re Devon Energy Corp., 332 S.W.3d 543,

547 (Tex. App.—Houston [1st Dist.] 2009, no pet.).          Neither party specifically argues for

preemption nor asserts the application of one act to the exclusion of the other. Our analysis below

concerns whether the parties agreed to an arbitration provision, and, under both the FAA and TAA,

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we apply ordinary state contract law principles to reach our decision. See In re D. Wilson Constr.

Co., 196 S.W.3d at 781; Sporran Kbusco, Inc. v. Cerda, 227 S.W.3d 288, 291 (Tex. App.—San

Antonio 2007, pet. denied). Consequently, we need not resolve whether one or both acts apply.

       Regardless, we do not have jurisdiction over TFR’s appeal from the trial court’s denial of

its motion for reconsideration. The FAA allows for interlocutory appeals from an order denying

a motion to compel arbitration. See 9 U.S.C. § 16(a)(1)(B); TEX. CIV. PRAC. & REM. CODE ANN.

§ 51.016; SK Plymouth, LLC v. Simmons, 605 S.W.3d 706, 713 (Tex. App.—Houston [1st Dist.]

2020, no pet.). However, there is no statutory authority for an interlocutory appeal from an order

denying a motion to reconsider the denial of a motion to compel arbitration. SK Plymouth, 605

S.W.3d at 713; Hydro Mgmt. Sys., LLC v. Jalin, Ltd., No. 04-09-00813-CV, 2010 WL 1817813,

at *2 (Tex. App.—San Antonio May 5, 2010, no pet.). Likewise, under the TAA, the denial of a

motion to compel arbitration is immediately appealable, but the denial of a motion to reconsider

the denial of a motion to compel arbitration is not. See TEX. CIV. PRAC. & REM. CODE ANN.

§ 171.098(a)(1); Brand FX, LLC v. Rhine, 458 S.W.3d 195, 201 (Tex. App.—Fort Worth 2015, no

pet.). TFR does not contend that its motion for reconsideration is a new motion to compel

arbitration. Cf. Branch Law Firm L.L.P. v. Osborn, 532 S.W.3d 1, 11–12 (Tex. App.—Houston

[14th Dist.] 2016, pet. denied) (concluding court had jurisdiction over interlocutory appeal from

denial of third motion to compel arbitration, which was distinct from second motion). Therefore,

we dismiss the portion of TFR’s appeal challenging the denial of the motion for reconsideration

because no statute authorizes our jurisdiction. See SK Plymouth, 605 S.W.3d at 714; Hydro Mgmt.

Sys., 2010 WL 1817813, at *2.

       We, however, have jurisdiction over TFR’s interlocutory appeal from the denial of its

motion to compel arbitration. See 9 U.S.C. § 16(a)(1)(B); TEX. CIV. PRAC. & REM. CODE ANN.

§ 51.016; TEX. CIV. PRAC. & REM. CODE ANN. § 171.098(a)(1). TFR timely filed a notice of appeal

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within twenty days after the trial court signed its order denying TFR’s motion to compel. See TEX.

R. APP. P. 26.1(b); Brand FX, 458 S.W.3d at 201.

II. Existence of a Valid, Enforceable Arbitration Agreement

       We review a trial court’s denial of a motion to compel arbitration for an abuse of discretion.

Henry v. Cash Biz, LP, 551 S.W.3d 111, 115 (Tex. 2018). A party seeking to compel arbitration

must establish: (1) the existence of a valid, enforceable arbitration agreement and (2) that the

claims at issue fall within that agreement’s scope. Bonsmara Nat. Beef Co. v. Hart of Tex. Cattle

Feeders, LLC, 603 S.W.3d 385, 397 (Tex. 2020). In this appeal, the parties’ dispute whether TFR

has established a valid, enforceable arbitration agreement through the exhibits attached to its

motion to compel arbitration. Murway also contends that he is not a party to any arbitration

agreement, even if Montage is.

       The existence of a valid arbitration agreement is a legal question. In re D. Wilson Constr.,

196 S.W.3d at 781. In interpreting an agreement to arbitrate, we apply ordinary contract principles.

J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 227 (Tex. 2003); Valerus Compr’n Servs., 417

S.W.3d 202, 208 (Tex. App.—Houston [1st Dist.] 2013, no pet.). “[W]hen we are called upon to

decide whether the parties have agreed to arbitrate, we do not resolve doubts or indulge a

presumption in favor of arbitration, because no party may be forced to submit to arbitration in the

absence of sufficient showing that the parties entered into a valid and binding arbitration

agreement.” Wright v. Hernandez, 469 S.W.3d 744, 751 (Tex. App.—El Paso 2015, no pet.). The

initial evidentiary burden for proving the existence of an arbitration agreement is held by the

movant. See In re Weekley Homes, L.P., 180 S.W.3d 127, 130 (Tex. 2005) (orig. proceeding);

Kmart Stores of Tex., L.L.C. v. Ramirez, 510 S.W.3d 559, 565 (Tex. App.—El Paso 2016, pet.

denied). “This evidentiary burden encompasses threshold evidentiary issues such as authenticity

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and evidence of mutual assent.” Ridge Nat. Res., L.L.C. v. Double Eagle Royalty, L.P., 564 S.W.3d

105, 122 (Tex. App.—El Paso 2018, no pet.).

       The evidentiary standards for a motion to compel arbitration are the same as for a motion

for summary judgment. In Estate of Guerrero, 465 S.W.3d 693, 703 (Tex. App.—Houston [14th

Dist.] 2015, pet. denied) (en banc). A trial court “may summarily decide whether to compel

arbitration on the basis of affidavits, pleadings, discovery, and stipulations.” Jack B. Anglin Co.

v. Tipps, 842 S.W.2d 266, 269 (Tex. 1992). “However, if the material facts necessary to determine

the issue are controverted, by an opposing affidavit or otherwise admissible evidence, the trial

court must conduct an evidentiary hearing to determine the disputed material facts.” Id.

       TFR contends that the arbitration provision on page two of some of the Rental Out forms

— the Additional Terms and Conditions page — was incorporated into the Application for Credit

on the date that the Application was signed in 2019. TFR also contends that it established that the

arbitration provision was applicable to each of the parties’ transactions through Woods’s affidavit

and Exhibits A-1 to A-5. Montage and Murway contend there is no evidence of a contract

containing an arbitration clause. In their brief, they review each of the five Rental Agreements

and assert the forms do not include an Additional Terms and Conditions page, or, if the page is

included, the forms do not comprise contracts because they suffer defects, such as lack of

signatures or printing after contract formation.

       We hold TFR has not carried its evidentiary burden to establish that the Application for

Credit incorporated an arbitration agreement by reference. We also hold, after reviewing all five

rental contracts individually, that TFR has established a binding arbitration agreement in only one

of the rental contracts — contract number 1164071, reflected in Exhibit A-4 — and only as to

Montage.

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        A. Incorporation by Reference

        Initially, we reject TFR’s contention that it has established the incorporation by reference

of an arbitration provision into the Application for Credit on the date the Application was signed

in 2019. TFR argues the Additional Terms and Conditions page, which is included on some of the

forms in Exhibits A-1 to A-5, was incorporated by reference into the Application for Credit when

Montage signed the Application in 2019. This Additional Terms and Conditions page includes

the arbitration provision TFR wishes to enforce. For its argument, TFR looks to the following

language in the Application for Credit:

        [Montage] in consideration of [TFR] extending commercial credit based upon the
        information furnished herein, warrants and agrees that by executing this
        Agreement: . . . . (b) [Montage] has received, read, understands and accepts all of
        the terms and conditions of TFR’s Rental Contract . . . .

        We agree that this language could incorporate terms in TFR’s Rental Contract on the date

the Application was signed in 2019. See, e.g., LDF Constr., Inc. v. Tex. Friends of Chabad

Lubavitch, Inc., 459 S.W.3d 720, 726–30 (Tex. App.—Houston [14th Dist.] 2015, no pet.)

(holding contract incorporated separate document with arbitration clause, even though separate

document was not attached to contract, was unsigned, and party opposing arbitration averred it

had not received a copy of, known about, or read separate document); Bob Montgomery Chevrolet,

Inc. v. Dent Zone Cos., 409 S.W.3d 181, 189 (Tex. App.—Dallas 2013, no pet.) (“The language

used to refer to the incorporated document is not important as long as the signed document ‘plainly

refers’ to the incorporated document.” (quoting Owen v. Hendricks, 433 S.W.2d 164, 166 (Tex.

1968))). However, TFR did not provide the trial court with an authenticated copy of the Rental

Contract to which the Application refers. 3

3
 TFR cites numerous cases in support of its argument for incorporation by reference, but each case is distinguishable
by the fundamental difference that the issue of authentication was not discussed. See, e.g., In re Raymond James &
Assocs., Inc., 196 S.W.3d 311, 315–16 (Tex. App.—Houston [1st Dist.] 2006, no pet.); LDF Constr., Inc., 459 S.W.3d

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         A party can satisfy its evidentiary burden to prove the existence of an arbitration agreement

by submitting an authenticated copy of an agreement containing an arbitration clause. DISH

Network L.L.C. v. Alexander, No. 13-20-00240-CV, 2021 WL 3085763, at *3 (Tex. App.—Corpus

Christi–Edinburg July 22, 2021, pet. denied) (mem. op.); ReadyOne Indus., Inc. v. Casillas, 487

S.W.3d 254, 258 (Tex. App.—El Paso 2015, no pet.). A document is considered authentic if a

witness vouches for its authenticity or if the document meets the requirement of self-

authentication. TEX. R. EVID. 901(a), 902. Testimony of a witness with knowledge is one way to

prove authenticity. See id. R. 901(b)(1). In a summary proceeding, “[a] properly sworn affidavit

stating that the attached documents are true and correct copies of the original authenticates the

copies so they may be considered as . . . evidence.” In Estate of Guerrero, 465 S.W.3d at 704.

         Here, TFR has not provided an affidavit from a person with knowledge that authenticates

the Rental Contract referenced in the 2019 Application for Credit. Woods’s affidavit provides as

follows:

         2. In April and May, 2021, TFR and Montage Development Company, LLC
         (“MONTAGE”), entered into numerous Rental Agreements (the “Agreements”)
         whereby TFR agreed to rent equipment to MONTAGE. A true and correct copy of
         the Application for Credit is attached hereto as Exhibit A-6. A true and correct
         copy of the Rental Agreements are attached hereto as Exhibits A-1-A-5.

         3. The Rental Agreements contain an arbitration provision, which provides, in part,
         that the parties shall submit to binding arbitration any “any [sic] dispute arising out
         of or relating to this transaction.”

         From these averments, TFR has not established that the authenticated Rental Agreements,

which TFR and Montage purportedly entered into in 2021, and the Rental Contract, referenced in

at 729 (not discussing authentication and noting, “[T]he incorporated A201–1997 is a standard AIA form readily
identifiable from the contract and available from the AIA.”). Here, Montage and Murway contest whether any exhibit
to TFR’s motion to compel arbitration includes a binding arbitration clause, and they specifically contest whether the
arbitration clause in the Additional Terms and Conditions page, found on some of the 2021 forms, modified earlier-
formed contracts.

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the 2019 Application, are the same. Woods does not aver that the Rental Agreements are true and

correct copies of the Rental Contract, or that the Additional Terms and Conditions page, found in

some of the Rental Agreements, comprise the Rental Contract. Additionally, Woods does not aver

that the Additional Terms and Conditions remained the same between 2019 and 2021, such that

an arbitration term reflected in the 2021 forms could accurately portray any such term purportedly

incorporated into a document signed in 2019. Cf. In re Raymond James & Assocs., Inc., 196

S.W.3d 311, 315–16 (Tex. App.—Houston [1st Dist.] 2006, no pet.) (noting incorporated “Client

Agreement was revised and updated periodically, with the result that there were seven versions of

the Client Agreement over the [relevant] period of time”). The Rental Agreements, moreover, do

not facially show that they existed in 2019 and remained unchanged from 2019 to 2021. Cf. LDF

Constr., 459 S.W.3d at 730–31 (looking to copyright date on incorporated form to establish

existence at time of contract formation). The most that can be said from the affidavit and exhibits

is that TFR has established that an arbitration provision was among the Additional Terms and

Conditions in the 2021 Rental Agreements, and that the provision remained unchanged across

forms comprising the Rental Agreements whenever it was included. In other words, TFR has not

established that an arbitration provision was among the Additional Terms and Conditions in 2019,

or that an arbitration provision was included within the Rental Contract, referenced by the

Application for Credit. Consequently, TFR has not satisfied its evidentiary burden to establish a

valid arbitration provision through incorporation by reference. See In re Weekley Homes, 180

S.W.3d at 130; In Estate of Guerrero, 465 S.W.3d at 705 (“Because Champion has not

authenticated the Arbitration Agreement or any of the sales documents it attached to its motions

to compel arbitration, there is no competent evidence of an agreement to arbitrate.”).

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       B. Individual Rental Agreements

       The Application for Credit also stipulated:

       Rentals by TFR to [Montage] made subsequent to the acceptance of this application
       by TFR shall be governed by the Rental Contract pertaining to such rental and by
       this Agreement. In the event that any provisions of the Rental Contract shall
       conflict with any provision of this Agreement, the Rental Contract shall control.

Woods avers that Montage entered into the Rental Agreements in 2021. The 2019 Application for

Credit explicitly requires subsequent rentals to be governed by the “Rental Contract[s] pertaining

to such rental[s].” Therefore, we must look to whether these subsequent Rental Agreements

contain valid arbitration provisions.

       We determine the matter by again carefully reviewing the record. Woods states that he has

personal knowledge, and he avers that Exhibits A-1 to A-5, are “true and correct cop[ies] of the

Rental Agreements.” See Mackey v. Great Lakes Invs., Inc., 255 S.W.3d 243, 252 (Tex. App.—

San Antonio 2008, pet. denied) (“A properly sworn affidavit . . . stating the attached documents

are true and correct copies of the originals authenticates the copies so that they may be considered

as summary judgment evidence.”). Woods does not indicate that any pages are missing from the

Rental Agreements, and Montage has not provided any controverting affidavit. Therefore, we

review each Rental Agreement as the “true and correct copy” of the agreement that Woods asserts

it to be. See TEX. R. EVID. 901(a) (“To satisfy the requirement of authenticating or identifying an

item of evidence, the proponent must produce evidence sufficient to support a finding that the item

is what the proponent claims it is.”).

       Exhibit A-1 consists of Rental Outs, Rental Invoices, and 4 Week Bills relating to Contract

1161827, all of which are unsigned by Montage. As TFR’s counsel asserted, “The [R]ental [O]ut

documents . . . are the contracts.” One of the Rental Out forms in Exhibit A-1 is only a single page

without an arbitration term. The other Rental Out form is two pages and contains an arbitration

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provision on the reverse side. However, the two-page Rental Out form is unsigned and indicates

that it was printed after the date the rental equipment was released to Montage. In his affidavit,

Woods avers that TFR and Montage “entered into” the Rental Agreements, but this statement is

conclusory as to the Exhibit A-1. “A conclusory statement is one that does not provide the

underlying facts to support the conclusion[.]” Cnty. of El Paso v. Aguilar, 600 S.W.3d 62, 77

(Tex. App.—El Paso 2020, no pet.) (citation omitted). Woods has not provided a factual basis to

support his conclusion that Montage entered into this unsigned contract that was printed after the

date stated for equipment delivery. Additionally, Woods asserts: “The Rental Agreements contain

an arbitration provision, which provides, in part, that the parties shall submit to binding arbitration

any ‘any [sic] dispute arising out of or relating to this transaction.’” Woods does not provide a

basis for this statement, other than the forms attached as Exhibits A-1 to A-5. His statement is

conclusory to the extent it attempts to modify or add to the terms reflected on Exhibits A-1 to A-

5. Accordingly, TFR has not provided probative evidence to establish a valid, binding arbitration

provision as to Exhibit A-1 and Contract 1161827. See Serafine v. Blunt, 466 S.W.3d 352, 358

(Tex. App.—Austin 2015, no pet.) (“Conclusory statements are not probative and accordingly will

not suffice to establish a prima facie case.”) (citation omitted). 4

         As to Exhibit A-2, the Rental Agreement does not include a Rental Out form; it includes

only a Rental Invoice and a Pickup Ticket, both of which are unsigned by Montage. We conclude

that TFR has not provided probative evidence to establish a valid, binding arbitration provision as

to Exhibit A-2 and Contract 1161701.

4
  TFR, moreover, does not provide a legal argument for contract formation based on the unsigned documents which
state printing dates after delivery. In its brief, it asserts: “[W]hether anyone signed the separate rental agreements —
and whether they were printed out or delivered to Montage after it received the equipment — are issues of distraction.”

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       Exhibit A-3 includes a Rental Invoice, a 4 Week Bill, and a Pickup Ticket, all of which are

unsigned by Montage. The exhibit also includes two Rental Out forms. One of these Rental Out

forms is signed by a Montage representative and was printed on the date reflected as the equipment

delivery date; however, this Rental Out form does not include an Additional Terms and Conditions

page or otherwise include an arbitration provision. The other Rental Out form is unsigned and

printed after the date reflected as the delivery date. We conclude TFR has not provided probative

evidence to establish a valid, binding arbitration provision as to Exhibit A-3 and Contract 1162465.

       In contrast, TFR has provided probative evidence of the existence of a valid arbitration

provision as to the Rental Agreement reflected in Exhibit A-4 for Contract 1164071. This exhibit

includes a Rental Out form, printed on the date stated as the equipment delivery date and which is

signed by a Montage representative. The Rental Out form includes an Additional Terms and

Conditions page, which includes the arbitration provision that TFR seeks to enforce. In their brief,

Montage and Murway speculate that the second page could have been included in error; however,

Woods averred, based on personal knowledge, that the document was “true and correct.” Montage

and Murway also assert that the signature concerns a “Loss Damage Waiver;” however, the Rental

Out form reflects both a signature at the bottom of the first page and initials in a Loss Damage

Waiver section. Last, Montage and Murway argue there is no indication that the person who signed

the form was authorized to enter into contracts on Montage’s behalf; however, Montage and

Murway did not file a controverting affidavit to support their contention. See TEX. R. CIV. P. 93(7)

(party challenging execution of written instrument as made without authority must file verified

pleading); Lissiak v. SW Loan OO, L.P., 499 S.W.3d 481, 494 (Tex. App.—Tyler 2016, no pet.)

(“Absent a verified denial [filed pursuant to Rule 93(7)], the document is received into evidence

as fully proved.”). Consequently, we conclude that TFR has established the existence of a valid,

binding arbitration provision as to Montage with respect to the Rental Agreement reflected in

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                                                                                     04-22-00429-CV

Exhibit A-4 — contract number 1164071. Montage and Murway do not contest that the scope of

the arbitration provision covers TFR’s claims.

       The final Rental Agreement reflected in Exhibit A-5 does not include a Rental Out form;

it includes only a Rental Invoice and a Pickup Ticket, both of which are unsigned by Montage.

We conclude that TFR has not provided probative evidence to establish a valid, binding arbitration

provision as to Exhibit A-5 and Contract 1170368.

III. Murway Is Not Bound by the Arbitration Agreement

       Having determined that Exhibit A-4 reflects a Rental Agreement with a binding arbitration

provision as to Montage, we must now consider whether Murway, a nonsignatory, can be

compelled to arbitrate. TFR argues that Murway can be compelled based on the equitable theory

of agency and the intertwined-claims theory. We conclude TFR has not established that either

theory applies.

       Whether a nonsignatory can be compelled to arbitrate is a question of law. In re Labatt

Food Serv., L.P., 279 S.W.3d 640, 643 (Tex. 2009) (orig. proceeding). “Nonparties may be bound

to an arbitration clause when the rules of law or equity would bind them to the contract generally.”

Taylor Morrison of Tex., Inc. v. Ha, 660 S.W.3d 529, 532 (Tex. 2023) (citation and brackets

omitted). Courts have articulated six scenarios in which arbitration with nonsignatories may be

required: (1) incorporation by reference, (2) assumption, (3) agency, (4) alter ego, (5) equitable

estoppel, and (6) third-party beneficiary. Jody James Farms, JV v. Altman Grp., Inc., 547 S.W.3d

624, 633 (Tex. 2018).

       TFR asserts: “Murway is an agent of Montage; and TFR’s claims relate to his status as an

agent.” Assuming that to be true, TFR has not provided us with legal authority pursuant to which

a signatory could compel a nonsignatory agent to arbitrate. The authority TFR cites in its favor is

inapposite because it concerns the reverse situation to here — i.e, a nonsignatory agent compelling

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                                                                                                    04-22-00429-CV

a signatory to arbitrate. See, e.g., McMillan v. Comput. Transl’n Sys. & Support, Inc., 66 S.W.3d

477, 481 (Tex. App.—Dallas 2001, no pet.). In this reverse situation, a nonsignatory agent looks

to equity to compel arbitration, and arbitration is equitable because it prevents a signatory from

avoiding arbitration with another signatory by suing only a nonsignatory agent. See In re Kaplan

Higher Educ. Corp., 235 S.W.3d 206, 209 (Tex. 2007) (orig. proceeding); see also Roe v.

Ladymon, 318 S.W.3d 502, 520–21 (Tex. App.—Dallas 2010, no pet.).

         The instant case, instead, is similar to DK Joint Venture 1 v. Weyand, 649 F.3d 310, 314

(5th Cir. 2011), in which a signatory sought to compel nonsignatories to arbitrate. In DK, the

plaintiffs alleged that two nonsignatory corporate officers and fifteen “corporations controlled by

them” had committed fraud, breach of contract, breaches of fiduciary duty, and other wrongs. Id.

at 313. The court held: “Under general principles of contract and agency law, the fact that the

defendant corporations entered into the Subscription Agreements[, which included arbitration

provisions,] did not cause their agents, . . . who acted only as officers on behalf of the corporations,

to be personally bound by those agreements.” Id. at 314. The court concluded: “[B]oth the Texas

and federal courts have recognized that ‘it matters whether the party resisting arbitration is a

signatory or not.’” Id. at 317 (citing Merrill Lynch Inv. Mgrs v. Optibase, Ltd., 337 F.3d 125, 131

(2d Cir. 2003)). 5

         TFR also argues the intertwined-claims theory allows it to compel Murway to arbitrate.

The intertwined-claims theory, also known as the alternative-estoppel theory, would allow a

nonsignatory to compel arbitration when (1) it has a “close relationship” with a signatory to a

contract with an arbitration agreement and (2) the claims are “intimately founded in and

5
 TFR tries to distinguish DK on the basis that the corporate officers in DK “merely signed the agreement on behalf
of a disclosed principal,” but the allegations in DK do not support this reading. See DK, 649 F.3d at 313 (allegations
corporate officers controlled companies and committed fraud, breach of contract, breaches of fiduciary duty, and other
wrongs).

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                                                                                     04-22-00429-CV

intertwined with the underlying contract obligations.” Jody James Farms, 547 S.W.3d at 639

(quoting Thomson-CSF, S.A. v. Am. Arbitration Ass’n, 64 F.3d 773, 779 (2d Cir. 1995)). The

Texas Supreme Court has considered but never accepted the theory as valid. See id.

       Even if valid, TFR has not established that the theory applies here. To begin, it is not

apparent that the theory could apply to a nonsignatory, such as Murway. See Bridas S.A.P.I.C. v.

Gov’t of Turkmenistan, 345 F.3d 347, 361 (5th Cir. 2003) (“The Second Circuit has expressly

stated that the [alternative-estoppel theory] applies only to prevent ‘a signatory from avoiding

arbitration with a nonsignatory when the issues the nonsignatory is seeking to resolve in

arbitration are intertwined with the agreement that the estopped party has signed.’”) (quoting

Thomson-CSF, 64 F.3d at 779 (emphasis added)); see also Jody James Farms, 547 S.W.3d at 629

(considering whether “a person who has agreed to arbitrate disputes with one party may be required

to arbitrate related disputes with non-parties”). Assuming the theory could apply, “alternative

estoppel requires not only a dispute intertwined with the contract but also a relationship between

the parties that developed in a manner that makes it ‘unfair’ not to compel arbitration.” Jody James

Farms, 547 S.W.3d at 639 (quoting Sokol Holdings, Inc. v. BMB Munai, Inc., 542 F.3d 354, 361

(2d Cir. 2008)). Here, the arbitration provision is found in the Rental Agreement reflected in

Exhibit A-4. Murway did not sign this agreement, and there is no indication that he was even

aware of this agreement or the arbitration provision within it. Under these circumstances, we

cannot say that it would be unfair not to compel Murway to arbitrate.

                                          CONCLUSION

       We hold that the trial court abused its discretion by denying TFR’s motion to compel

arbitration as to its claims against Montage related to the Rental Agreement referenced in Exhibit

A-4 of TFR’s motion — contract number 1164071. Therefore, we reverse the trial court’s order

insofar as it denied TFR’s motion to compel arbitration and stay proceedings as to these claims.

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                                                                                                   04-22-00429-CV

We otherwise affirm the trial court’s “Order Denying Plaintiff’s Motion for Referral to Private

Arbitration and Motion to Stay Proceedings,” signed on June 29, 2022. We remand the case with

instructions that trial court proceedings as to TFR’s claims against Montage related to contract

number 1164071 be stayed and that TFR and Montage be compelled to arbitrate these claims. 6

                                                          Rebeca C. Martinez, Chief Justice

6
 TFR asks for rendition but has not provided any authority under which we may partially render judgment in its favor.
When reversing the denial of a motion to compel arbitration, our practice — and that of the Texas Supreme Court —
has been to remand. See, e.g., Taylor Morrison of Tex., Inc., 660 S.W.3d at 535; St. Mary’s Hall, Inc. v. Garcia, No.
04-21-00073-CV, 2022 WL 789498, at *4 (Tex. App.—San Antonio Mar. 16, 2022, no pet.) (mem. op.).

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