Wednesday, October 22, 2014

Can an order compelling arbitration be challenged by immediate appeal?



No immediate appellate review of trial court order sending parties to arbitration either under the FAA or the TAA. Interlocutory appeal not authorized under such circumstances (as opposed to an order denying a motion to compel arbitration). Bashaw v Republic State Mortgage Co, No 01-14-00427-CV (Tex.App.- Houston [1st Dist.] Sep. 4, 2014) 


FRANCIS BASHAW
v.
REPUBLIC STATE MORTGAGE CO

No. 01-14-00427-CV

Court of Appeals of Texas, First District, Houston.
Opinion issued September 4, 2014.
Panel consists of Chief Justice Radack and Justices Jennings and Keyes.

First Court of Appeals (Old Harris County Courthouse) 
PER CURIAM MEMORANDUM OPINION

Appellant, Francis Bashaw, attempts to appeal from the trial court's April 25, 2014 order staying this case and granting Republic State Mortgage Co.'s motion to compel arbitration. Appellee, Republic State Mortgage Co., has filed a "Motion to Dismiss for Lack of Jurisdiction Pursuant to Rule 42.3(a)." We grant the motion and dismiss this appeal.

Bashaw entered into a "Branch Agreement" with Republic State Mortgage in 2006. On September 22, 2011, Bashaw filed suit against Republic State Mortgage, alleging breach of fiduciary duty, fraud by nondisclosure, and defalcation. On October 25, 2011, Republic State Mortgage filed a motion to dismiss or, in the alternative, to stay and compel arbitration. On September 21, 2012, the trial court granted the motion to stay, referred the case to arbitration, and stayed the case for six months. On June 11, 2013, Republic State Mortgage filed an amended motion to stay and to compel arbitration. The trial court granted the amended motion on April 25, 2014, again staying the case for six months and referring the claims to arbitration. On May 14, 2014, Bashaw filed a notice of appeal from the trial court's April 25, 2014 order.

On July 9, 2014, Republic State Mortage filed a motion to dismiss this appeal for lack of jurisdiction. In the motion, Republic State Mortgage argues that the trial court's April 25, 2014 order is a non-appealable interlocutory order, and that we therefore have no jurisdiction over this appeal. Bashaw has not responded to the motion.

"Whether under the Texas Arbitration Act or the Federal Arbitration Act, there is no interlocutory appeal over an order granting a motion to compel arbitration. As a result, we have no jurisdiction over this appeal and must dismiss it." Koontz v. Citibank (South Dakota), N.A., No. 01-05-01140-CV, 2007 WL 1299674, at *1 (Tex. App.-Houston [1st Dist.] May 3, 2007, no pet.) (mem. op., internal citations omitted); see In re Gulf Exploration, LLC, 289 S.W.3d 836, 839-41 (Tex. 2009) (quoting Perry Homes v. Cull,258 S.W.3d 580, 586 n.13 (Tex. 2008)); Ortiz v. Junell Law Firm, No. 14-11-00805-CV, 2011 WL 5554620, at *1 (Tex. App.-Houston [14th Dist.] Nov. 15, 2011, pet. denied) (mem. op.).

Accordingly, we grant Republic State Mortgage's motion to dismiss and dismiss this appeal for want of jurisdiction. See TEX. R. APP. P. 42.3(a). We dismiss any other pending motions as moot.



Thursday, October 10, 2013

Lack of Consideration argument with respect to arbitration agreement


The mutual surrender of the right to trial by jury that is necessarily part of an agreement to arbitrate disputes suffices as consideration under contract law.  

Regarding any lack-of-consideration argument, it is well-settled in Texas that "[a] mutual agreement to arbitrate claims provides sufficient consideration for an arbitration agreement." Sun Fab Indus. Contracting Inc. v. Lujan, 361 S.W.3d 147, 152 (Tex. App.-El Paso 2011, no pet.) (citing In re U.S. Home Corp., 236 S.W.3d 761, 764 (Tex. 2007) (orig. proceeding) (per curiam)); see In re Tenet Healthcare, Ltd., 84 S.W.3d 760, 767 (Tex. App.-Houston [1st Dist.] 2002, orig. proceeding) (holding arbitration agreement was supported by consideration where "the parties' agreement created mutual promises by both to forego their right to a jury trial"); In re Alamo Lumber Co., 23 S.W.3d 577, 579-80 (Tex. App.-San Antonio 2000, orig. proceeding) ("Since the parties surrendered their rights to trial by jury, these mutual promises supply valid consideration.").

SOURCE: CORPUS CHRISTI COURT OF APPEALS - Nos. 13-12-00564-CV AND 13-12-00620-C  - 6/27/2013  


Wednesday, August 21, 2013

Effect of interlocutory appeal on case pending the trial court


Can you stop the trial court from taking any further action in the case by filing an interlocutory appeal to challenge the denial of a motion to compel arbitration?  

The appeal does not stop the trial court in its tracks. Abatement may be sought, but is not automatic, as explained by Justice Karen Angelini of the San Antonio Court of Appeals in an August 15, 2013 order.  

4th Court of Appeals
in San Antonio 

ORDER 

Appellants seek to appeal from an interlocutory order denying a motion to compel arbitration. See TEX. CIV. PRAC. & REM. CODE ANN. 51.016 (West Supp. 2012) (providing that in a matter subject to the Federal Arbitration Act, a person may take an appeal from an interlocutory order under the same circumstances that an appeal from a federal court's order would be permitted). On August 6, 2013, appellants filed a motion to stay all trial court proceedings, including discovery and motion practice, until this appeal is resolved. On August 13, 2013, appellees filed a response to appellants' motion to stay all trial court proceedings. This response also contains a request that this appeal be dismissed for lack of jurisdiction.

While an appeal from an interlocutory order is pending, the trial court retains jurisdiction over the case and, unless prohibited by statute, may make further orders. TEX. R. APP. P. 29.5. If permitted by law, the trial court may even proceed with a trial on the merits. Id. However, the trial court must not make an order that interferes with or impairs the jurisdiction of the appellate court, or the effectiveness of any relief sought or that may be granted on appeal. Id.

In their notice of appeal, appellants claim they are entitled to an appeal of the trial court's interlocutory order based on section 51.016 of the Texas Civil Practice and Remedies Code. This statute, however, does not expressly require a stay of the trial court proceedings during the pendency of an appeal from an interlocutory order. See TEX. CIV. PRAC. & REM. CODE ANN. 51.016. Moreover, nothing indicates the appellants asked the trial court to stay its proceedings before asking this court to stay the trial court's proceedings. See id.; see also TEX. R. APP. P. 29.2 (providing that the trial court may permit an order granting interlocutory relief to be superseded and, if the trial court refuses, the appellate court may review the decision for an abuse of discretion).

Appellants' motion to stay all trial court proceedings is therefore DENIED. It is FURTHER ORDERED that appellees' request to dismiss this appeal for lack of jurisdiction is CARRIED WITH THIS APPEAL.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the said court on this 15th day of August, 2013.

SOURCE:  SAN ANTONIO COURT OF APPEALS - Order in Cause No. 04-13-00525-CV issued 2013-08-15 

Monday, July 15, 2013

Exceptions to deadline for appealing denial of motion to compel arbitration - Don't count on them


The trial court's denial of a motion to compel arbitration can be appealed immediately, but the right to appeal expires faster than is the case for an appeal from a final judgment because such appeals are accelerated interlocutory appeals. There may be exceptions, but benefiting from them can get pretty tricky, as the following excerpt from the Dallas Court of Appeals in Pilot Travel Centers, LLC v. McCray illustrates. The lesson: Don't take any chances. Appeal within 20 days, or better still, less than 20 days.  



Courthouse Clock Tower
The clock keeps ticking 
Section 51.016 of the civil practice and remedies code provides that in a matter subject to the Federal Arbitration Act (FAA), a party may appeal from an interlocutory order of a district court "under the same circumstances that an appeal from a federal district court's order . . . would be permitted by 9 U.S.C. Section 16. TEX. CIV. PRAC. & REM. CODE ANN. § 51.016 (West Supp. 2012); see CMH Homes v. Perez, 340 S.W.3d 444, 448-49 (Tex. 2011) (explaining that section 51.016 of the civil practice and remedies code provides for interlocutory appeals in FAA cases so long as "it would be permitted under the same circumstances in federal court under [9 U.S.C.] section 16"). Section 16 of the FAA provides an appeal may be taken from an order "denying an application under section 206 of this title to compel arbitration." 9 U.S.C.A. § 16(a)(1)(C) (West 2009); Austin Commercial Contractors, L.P. v. Carter & Burgess, Inc., 347 S.W.3d 897, 900 (Tex. App.-Dallas 2011, pet. denied); Texas La Fiesta Auto Sales, LLC v. Belk, 349 S.W.3d 872, 877 (Tex. App.-Houston [14th Dist.] 2011, no pet.).

An appeal from an interlocutory order denying a motion to compel arbitration is an accelerated appeal. See TEX. R. APP. P. 28.1 ("Appeals from interlocutory orders (when allowed by statute) . . . are accelerated appeals."). In an accelerated appeal, the notice of appeal must be filed within twenty days after the judgment or order is signed. TEX. R. APP. P. 26.1(b); see also Iron Mountain Bison Ranch, Inc. v. Easley Trailer Mfg., Inc., 964 S.W.2d 762, 763 (Tex. App.-Amarillo 1998, no pet.) (interlocutory appeal is perfected by filing notice of appeal with trial court within twenty days after judgment or order is signed).

The record contains a November 12, 2012 Order denying Pilot Travel's motion to compel arbitration. The notice of accelerated appeal of the November 12, 2012 Order denying Pilot Travel's motion to compel arbitration had to be filed within twenty days after the date the order was signed. Because the twentieth day after the November 12, 2012 Order fell on Sunday, December 2, 2012, Pilot Travel's deadline for perfecting the appeal from that order fell on the following day, Monday, December 3, 2012. See TEX. R. APP. P. 4.1(a).[3] Pilot Travel filed its notice of appeal on December 28, 2012, beyond the twenty-day deadline for perfecting appeal of the interlocutory November 12, 2012 Order.

In an accelerated appeal, absent a rule of civil procedure 26.3 motion, the deadline for filing a notice of appeal is strictly set at twenty days after the appealable interlocutory order is signed. See In re K.A.F., 160 S.W.3d 923, 927 (Tex. 2005). However, if applicable, rule of civil procedure 306a may operate to extend the deadline for filing a notice of appeal of an interlocutory order. See TEX. R. CIV. P. 306a; see also John v. Marshall Health Servs., Inc., 58 S.W.3d 738, 740 (Tex. 2001). If a party affected by an appealable order has not, within twenty days after the order was signed, either received notice required by rule of civil procedure 306a(3) or acquired actual knowledge of the signing, then any period that, under the rules of appellate procedure, runs from the signing of the order will begin on the earlier of the date when the party receives notice or acquires actual knowledge of the signed order; however, no such period may begin to run more than ninety days after the judgment or order was signed. TEX. R. APP. P. 4.2(a)(1); see also TEX. R. CIV. P. 306a(4).

However, rule of civil procedure 306a(4) is not self-executing. Subsection (5) of rule of civil procedure 306a provides a procedure that enables the trial court to change the date the appellate timetable begins to run from the actual date of the interlocutory order to the date on which the party received the clerk's notice or acquired actual knowledge that the trial court signed the order, whichever occurs first, as long as that date is not more than 90 days after the trial court signed the interlocutory order. TEX. R. CIV. P. 306a(5). "The party adversely affected is required to prove in the trial court, on sworn motion and notice, the date on which the party or his attorney first either received a notice of the judgment or acquired actual knowledge of the signing and that this date was more than twenty days after the judgment was signed." Id.; see Hone v. Hanafin, 105 S.W.3d 15, 18 (Tex. App.-Dallas 2002) (party must obtain order from trial court that reflects date the party or party's attorney first either received notice or acquired actual knowledge that the order was signed), rev'd on other grounds, 104 S.W.3d 884 (Tex. 2003) (per curiam). A parallel provision of the rules of appellate procedure affords additional time for filing documents related to the appeal under the same time parameters and in accordance with the procedures set out in rule of civil procedure 306a(5). TEX. R. APP. P. 4.2(b); see also TEX. R. CIV. P. 306a(5). After conducting the hearing contemplated by rule of civil procedure 306a(5), the trial court "must sign a written order that finds the date when the party or the party's attorney first either received notice or acquired actual knowledge that the judgment or order was signed." TEX. R. APP. P. at 4.2(c); Moore Landrey, L.L.P. v. Hirsch & Westheimer, P.C., 126 S.W.3d 536, 540 (Tex. App.-Houston [1st Dist.] 2003, no pet.). The requirements of rule 306a(5) are jurisdictional. Mem'l Hosp. of Galveston Cnty. v. Gillis, 741 S.W.2d 364, 365 (Tex. 1987) (per curiam); Nedd-Johnson v. Wells Fargo Bank, N.A., 338 S.W.3d 612, 613 (Tex. App.-Dallas 2010, no pet.).

Here, Pilot Travel asserted reliance on rule of civil procedure 306a in its objection and verified motion to vacate the January 16, 2013 Order. The sworn 306a motion served the purpose of establishing a prima facie case of lack of timely notice of the November 12, 2012 Order. See TEX. R. CIV. P. 306a(5). For purposes of appellate jurisdiction, rule of appellate procedure 4.2(c) requires that the trial court sign a written order, pursuant to rule of civil procedure 306a, that finds the date when Pilot Travel or Pilot Travel's attorney first either received notice or acquired actual knowledge that the November 12, 2012 Order denied Pilot Travel's motion to compel arbitration. See TEX. R. APP. P. at 4.2(c); see also Nedd-Johnson, 338 S.W.3d at 613; see also Gillis, 741 S.W.2d at 366 ("Rule 306a plainly requires that this proof be made in the trial court, not the court of appeals."). Without a finding of the date Pilot Travel or its attorney first received notice or actual knowledge of the November 12, 2012 Order, there can be no extension of the appellate timetable for Pilot Travel's notice of appeal of the denial of its motion to compel arbitration. See TEX. R. APP. P. 4.2(c); see also Nedd-Johnson, 338 S.W.3d at 613.

Pilot Travel cites In re C.L.C., No. 12-02-00348-CV, 2003 WL 252139 (Tex. App.-Tyler Feb. 5, 2003, no pet.) (mem. op. on reh'g) in support of its argument that, because the December 12, 2012 Order was the only order denying its motion to compel arbitration that it received, the December 28, 2012 notice of appeal was timely as filed within twenty days of December 12, 2012. However, unlike this case, in In re C.L.C., the trial judge signed an order that included a finding of the earliest date upon which either appellant or appellant's attorney received notice or actual knowledge of the judgment, and appellant's notice of accelerated appeal was timely as filed within twenty days of the date found by the trial judge. In re C.L.C., 2003 WL 252139, at *1.

Rule of appellate procedure 27.3 provides that after an order in a civil case has been appealed, if the trial court modifies the order, the appellate court must treat the appeal as from the subsequent order and may treat actions relating to the appeal of the first order as relating to the appeal of the subsequent order. TEX. R. APP. P. 27.3. While rule 27.3 contemplates the trial court's ability to modify or amend orders that have been appealed, neither the December 12, 2012 Order nor the May 1, 2013 Order modified or amended the trial court's November 12, 2012 Order. By denying Pilot Travel's motion to compel arbitration, the December 12, 2012 Order and the May 1, 2013 Order provided the same substantive ruling contained in the trial court's November 12, 2012 Order. Rule of appellate procedure 29.6 governs our jurisdiction to review "a further appealable interlocutory order concerning the same subject matter." See TEX. R. APP. P. 29.6. Because the December 12, 2012 Order and May 1, 2013 Order are substantively identical to the trial court's November 12, 2012 Order, neither order may be considered a further order of the trial court concerning Pilot Travel's motion to compel arbitration. See TEX. R. APP. P. 29.6(a)(1). To conclude otherwise would enable a trial court to alter an appellate timetable, and render an otherwise untimely appeal timely, simply by signing a subsequent order affording the same relief.

Pilot Travel acknowledged at submission that the trial court's May 1, 2013 Order denying Pilot Travel's motion to compel arbitration made no substantive change to the prior November 12, 2012 Order and December 12, 2012 Order denying Pilot Travel's motion to compel arbitration, and that it was not relying on the May 1, 2013 Order to restart the appellate timetable for filing this interlocutory appeal. Pilot Travel acknowledged it could offer no authority in support of a contention that a trial court can affect or extend the appellate timetable by signing a subsequent order containing the same denial of a motion to compel arbitration contained in the November 12, 2012 Order. See City of Houston v. Estate of Jones, 388 S.W.3d 663, 667 (Tex. 2012) (permitting interlocutory appeal of a denial of a motion to reconsider a plea to jurisdiction "would effectively eliminate the requirement that appeals from interlocutory orders must be filed within twenty days after the challenged order is signed," and "[t]hat would work against the main purpose of the interlocutory appeal statute, which is to increase efficiency of the judicial process."); Bally Total Fitness Corp. v. Jackson, 53 S.W.3d 352, 358 (Tex. 2001) ("Allowing interlocutory appeals whenever a trial court refuses to change its mind . . . would invite successive appeals and undermine the [interlocutory appeal] statute's purpose of promoting judicial economy."). However, according to Pilot Travel, even though the December 12, 2012 Order made no change to the trial court's November 12, 2012 denial of Pilot Travel's motion to compel arbitration other than crossing out the date of November 12, 2012 and writing in the date of December 12, 2012, Pilot Travel contends its notice of appeal was timely because it received notice only of the December 12, 2012 Order, and, therefore, the appellate timetable did not begin to run until it received notice of the December 12, 2012 Order.

Pilot Travel's contention that under rule of civil procedure 306a, its appellate timetable for perfecting its interlocutory appeal ran from the date it or its attorney received notice or actual knowledge of the November 12, 2012 Order fails. Pilot Travel did not establish in the trial court the specific date it or its attorney received notice or actual knowledge of the November 12 Order, and Pilot Travel did not obtain a signed written order from the trial court that recites that specific date. See TEX. R. CIV. P. 306a(5); TEX. R. APP. P. 4.2(b), (c). Because Pilot Travel did not comply with rule of civil procedure 306a(5), it is not entitled to receive an extension of time for perfecting its appeal under rule 4.2. See TEX. R. APP. P. 4.2(b), (c).

Pilot Travel's notice of interlocutory appeal was due, but not filed, within twenty days after the November 12, 2012 appealable interlocutory order was signed. To conclude otherwise would defeat the purpose of the interlocutory appeal statute. Thus, Pilot Travel's notice of appeal was not timely perfected under rule of appellate procedure 26.1(b). See Tex. R. App. P. 26.1(b).

Without a timely filed notice of appeal, this Court lacks jurisdiction. See TEX. R. APP. P. at 25.1. Although the Texas Supreme Court has directed us to construe the rules of appellate procedure reasonably and liberally so that the right to appeal is not lost by imposing requirements not absolutely necessary to effectuate the purpose of a rule, see Verburgt v. Dorner, 959 S.W.2d 615, 616-17 (Tex. 1997), we are prohibited from expanding the scope of our jurisdiction by enlarging the time for perfecting an appeal in a civil case in a manner not provided for by rule. See TEX. R. APP. P. 2; see also In re T.W., 89 S.W.3d 641, 642 (Tex. App.-Amarillo 2002, no pet.). Rule of appellate procedure 2 expressly prohibits this Court from suspending the requirements of the appellate rules in a manner which will "alter the time for perfecting an appeal in a civil case."

Consequently we do not address the merits of this interlocutory appeal. We dismiss this interlocutory appeal for want of jurisdiction. See TEX. R. APP. P. at 42.3(a).

JUDGMENT

In accordance with this Court's opinion of this date, the appeal is DISMISSED. It is ORDERED that appellees Joan McCray, James McCray, and Shamekia Gullatte, as Next Friend of Brandon Gullate, recover their costs of this appeal from appellant Pilot Travel Centers, LLC.

SOURCE: Pilot Travel Centers, LLC v. McCray, No. 05-13-00002-CV (Tex.App.- Dallas, July 10, 2013)

[1] The January 16, 2013 Order states the trial court considered appellees' "Motion for Judgment Nunc Pro Tunc, and the response thereto." However, the record contains no motion for judgment nunc pro tunc, nor any response by Pilot Travel to such a motion. See TEX. R. CIV. P. 316 (permits trial court to correct mistakes and incorrect recitals in judgments but only after reasonable notice of any application for correction is given to opposing party).

[2] In its objection to the January 16, 2013 order and motion to vacate that order, Pilot Travel stated it was never served with a motion for judgment nunc pro tunc.

[3] On appeal, the parties do not dispute the trial court conducted a hearing on Pilot Travel's motion to compel arbitration on November 16, 2012. However, no reporter's record containing a transcript of the November 16, 2012 hearing has been filed with this Court. Even assuming the November 12, 2012 date of signature on the order was incorrect and should have been November 16, 2012, the deadline for filing an accelerated appeal of a November 16, 2012 denial of Pilot Travel's motion to compel arbitration would have been December 6, 2012.

Under rule of appellate procedure 26.3, an appellate court may extend the time to file a notice of appeal if, within fifteen days after the deadline for filing the appeal notice, the party files a notice of appeal in the trial court and a motion for extension of time complying with rule of appellate procedure 10.5(b) in the court of appeals. See TEX. R. APP. P. 26.3. In Verburgt v. Dorner, 959 S.W.2d 615, 617 (Tex. 1997), the Texas Supreme Court held that a motion for extension of time is implied when a party, acting in good faith, files a cost bond within the fifteen-day period in which the party would be entitled to move to extend the filing deadline under the rules of appellate procedure. To be entitled to an implied fifteen-day extension to file its notice of appeal under rule of appellate procedure 26.3 from the November 12, 2012 Order, Pilot Travel would have had to file its notice of appeal by December 18, 2012. To be entitled to an implied fifteen-day extension to file its notice of appeal under rule of appellate procedure 26.3 from November 16, 2012, Pilot Travel would have had to file its notice of appeal by December 21, 2012.


Tuesday, March 19, 2013

Trial court order compelling arbitration not immediately appealable



Can an order compelling arbitration signed by a trial judge be challenged in an immediate appeal so as to avoid the need to arbitrate? Generally no. Arbitration is favored. An order denying arbitration is a different matter. Texas statute authorizing interlocutory appeal tracks federal provision for such appeals.


Under the Federal Arbitration Act (FAA), an order compelling arbitration and granting a stay is not immediately reviewable. In re Gulf Exploration, LLC, 289 S.W.3d at 842; see 9 U.S.C.A. § 16(b)(1),(3)(West 2009)(interlocutory orders compelling arbitration and staying proceeding are not immediately reviewable under the FAA). Because such an order is not appealable under the FAA, it is not appealable under Section 51.016 of the Texas Civil Practice and Remedies Code. See TEX. CIV. PRAC. & REM. CODE ANN. § 51.016 (West Supp. 2012)(in matters subject to the FAA, an appeal is available only under the same circumstances that an appeal from federal district court's order would be permitted).

MEMORANDUM OPINION FROM EL PASO   

In this employment-discrimination and -retaliation case, Benjamin Tice, Jr. appeals from the trial court's order granting El Paso Education Initiative, Inc. d/b/a Burnham Wood Charter School District's motion to compel arbitration and stay the proceedings. El Paso Education Initiative now moves to dismiss the appeal for want of jurisdiction.[1] Concluding that we lack jurisdiction over this appeal, we dismiss it.

It is well settled that appellate courts have jurisdiction over final judgments. Lehmann v. Har-Con Corp., 39 S.W.3d 191, 195 (Tex. 2001). A judgment is final if it disposes of all pending parties and claims. Id. An order compelling arbitration and staying proceedings pending arbitration does not dispose of all claims and parties. In re Gulf Exploration, LLC, 289 S.W.3d 836, 840-41 (Tex. 2009)(orig. proceeding). Thus, the trial court's order at issue here is interlocutory.

Appellate courts have jurisdiction to consider immediate appeals of interlocutory orders only if a statute explicitly confers appellate jurisdiction. See Stary v. DeBord, 967 S.W.2d 352, 352-53 (Tex. 1998). If a statute authorizes an interlocutory appeal, we strictly construe it. CMH Homes v. Perez, 340 S.W.3d 444, 447-48 (Tex. 2011); Nazareth Hall Nursing Ctr. v. Castro, 374 S.W.3d 590, 593 (Tex.App.-El Paso 2012, no pet.); Lucchese, Inc. v. Solano, 388 S.W.3d 343, 348 (Tex.App.-El Paso 2012, no pet.). The substance and function of the interlocutory order from which an appeal is taken controls our interlocutory jurisdiction. Castro, 374 S.W.3d at 593; Solano, 388 S.W.3d at 348; Texas La Fiesta Auto Sales, LLC v. Belk, 349 S.W.3d 872, 878 (Tex.App.-Houston [14th Dist.] 2011, no pet.). When a party attempts to appeal a non-appealable interlocutory order, we have no jurisdiction except to dismiss the appeal. Cantu Servs., Inc. v. United Freedom Assoc., Inc., 329 S.W.3d 58, 63 (Tex.App.-El Paso 2010, no pet.) [Quotation marks omitted].

Under the Federal Arbitration Act (FAA), an order compelling arbitration and granting a stay is not immediately reviewable. In re Gulf Exploration, LLC, 289 S.W.3d at 842; see 9 U.S.C.A. § 16(b)(1),(3)(West 2009)(interlocutory orders compelling arbitration and staying proceeding are not immediately reviewable under the FAA). Because such an order is not appealable under the FAA, it is not appealable under Section 51.016 of the Texas Civil Practice and Remedies Code. See TEX. CIV. PRAC. & REM. CODE ANN. § 51.016 (West Supp. 2012)(in matters subject to the FAA, an appeal is available only under the same circumstances that an appeal from federal district court's order would be permitted).

Here, both parties agreed at trial that the arbitration agreement was governed by the FAA, not the Texas General Arbitration Act (TAA).[2] The trial court's order compelling arbitration and staying the proceedings pending arbitration is therefore not reviewable by interlocutory appeal. We thus lack jurisdiction to consider Tice's appeal. Appellee's motion to dismiss the appeal for want of jurisdiction is hereby granted. Accordingly, we dismiss the appeal for want of jurisdiction.

SOURCE: EL PASO COURT OF APPEALS - No. 08-13-00014-CV – 1/13/2013

Friday, March 15, 2013

When should a motion to compel arbitration be granted, when not?

General principles of determining arbitrability as articulated by the Corpus Christi Court of Appeals in a recent appellate opinion.

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.

"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 facts touch matters covered by the underlying arbitration agreement.") Generally, under the FAA, state law governs whether the contracting parties agreed to arbitrate and federal law determines the scope of the arbitration clause. In re Weekley Homes, L.P., 180 S.W.3d 127, 130 (Tex. 2005) (orig. proceeding); see In re Rubiola, 334 S.W.3d at 224 ("Under the FAA, ordinary principles of state contract law determine whether there is a valid agreement to arbitrate.").

Arbitration agreements containing phrases such as "relating to" are interpreted broadly. In re Guggenheim Corporate Funding, LLC, 380 S.W.3d 879, 887-88 (Tex. App.-Houston [14th Dist.] 2012, orig. proceeding) (citing In re Bank One, N.A., 216 S.W.3d 825. 826-27 (Tex. 2007) (resolving doubt as to scope of arbitration agreement covering disputes "arising from or relating in any way to this Agreement" in favor of coverage); 950 Corbindale, L.P. v. Kotts Capital Holdings Ltd. P'ship, 316 S.W.3d 191, 196-97 (Tex. App.-Houston [14th Dist.] 2010, no pet.) (holding that broad arbitration provision defining "disputes" as "any dispute under or related to the partnership agreement or any document executed pursuant to the partnership agreement or any of the transactions contemplated by the partnership agreement shall be subject to arbitration" applied to all claims); TMI Inc. v. Brooks, 225 S.W.3d 783, 791 n.7 (Tex. App.-Houston [14th Dist.] 2007, orig. proceeding) (holding that phrase "arising out of and/or related to" in arbitration agreement is "broad form in nature, evidencing the parties' intent to be inclusive rather than exclusive")). "

However, if the facts alleged in support of the claim stand alone, are completely independent of the contract, and the claim could be maintained without reference to the contract, the claim is not subject to arbitration." Serv. Corp. Int'l v. Lopez, 162 S.W.3d 801, 810 (Tex. App.-Corpus Christi 2005, no pet.); see Osornia, 367 S.W.3d at 714 n.4.; AutoNation USA Corp. v. Leroy, 105 S.W.3d 190, 195 (Tex. App.-Houston [14th Dist.] 2003, orig. proceeding); see also In re Estate of Rowan, No. 05-06-681-CV, 2007 Tex. App. LEXIS 4466, at *8-9 (Tex. App.-Dallas June 7, 2007, no pet.) (mem. In construing the arbitration provision, we first determine whether it is possible to enforce the contract as written, without resort to parol evidence. J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 229 (Tex. 2003).

In construing a written contract, the primary concern of the court is to ascertain the true intentions of the parties as expressed in the instrument. In re Guggenheim Corporate Funding LLC, 380 S.W.3d at 887 (citing J.M. Davidson, 128 S.W.3d at 229). In the arbitration context, we must give effect to the parties' intent, whether enforcing an agreement to arbitrate or construing an arbitration clause. Id. Following arbitration jurisprudence, we apply a common-sense examination of the underlying claim and the forum-selection clause to determine if the claim comes within the scope of the clause. Id. (citing In re Lisa Laser USA, Inc., 310 S.W.3d 880, 884 (Tex. 2010) (orig. proceeding) (per curiam)). "A contract is unambiguous if it can be given a definite or certain legal meaning." J.M. Davidson, 128 S.W.3d at 229. "On the other hand, if the contract is subject to two or more reasonable interpretations after applying the pertinent rules of construction, the contract is ambiguous, creating a fact issue on the parties' intent." Id. A contract is not ambiguous merely because the parties disagree on its meaning. Seagull Energy E & P, Inc. v. Eland Energy, Inc., 207 S.W.3d 342, 345 (Tex. 2006). The issue of contractual ambiguity may be considered sua sponte by a reviewing court. See Progressive Cnty. Mut. Ins. Co. v. Kelley, 284 S.W.3d 805, 808 (Tex. 2009). op.).

SOURCE:   CORPUS CHRIST-EDINBURG COURT OF APPEALS - 13-12-00166-CV – 2/21/2013