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) 


No. 01-14-00427-CV
Opinion issued September 4, 2014.
Panel consists of Chief Justice Radack and Justices Jennings and Keyes.

First Court of Appeals (Old Harris County Courthouse) 

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.



In 2009, the Texas Legislature amended the Texas Arbitration Act to permit interlocutory appeals of orders denying motions to compel arbitration pursuant to the FAA. See Tex. Civ. Prac. & Rem. Code § 51.016 (West, Westlaw through 2013 3d C.S.); see also CMH Homes v. Perez, 340 S.W.3d 444, 448 (Tex. 2011) (construing section 51.016). If a matter is subject to the FAA, section 51.016 of the Texas Civil Practice and Remedies Code authorizes interlocutory appeals "to the court of appeals from the judgment or interlocutory order of a district court . . . under the same circumstances that an appeal from a federal district court's order or decision would be permitted by 9 U.S.C. Section 16." Tex. Civ. Prac. & Rem. Code § 51.016.