FIA Card Services, N.A. Fka MBNA America Bank, N.A. v. Valicia M. Horn

• Court: Court of Appeals of Texas
• Decided: June 23, 2009
• Docket: 14-08-00024-CV
• Status: Published

Opinion

Reversed and Remanded and Memorandum Opinion filed June 23, 2009

Reversed and Remanded and Memorandum Opinion filed June 23, 2009.

In The

Fourteenth Court of Appeals

____________

NO. 14-08-00024-CV

FIA CARD SERVICES, N.A. fka, MBNA AMERICA BANK N.A., Appellant

V.

VALICIA M. HORN, Appellee

On Appeal from the County Civil Court at Law No. 1

Harris County, Texas

Trial Court Cause No. 884736

M E M O R A N D U M   O P I N I O N

In this appeal we consider the propriety of the trial court=s dismissal of a suit to confirm an arbitration award. Concluding that the Federal Arbitration Act does not deprive the trial court of subject-matter jurisdiction, we reverse and remand.

I.  Background

Appellee Valicia M. Horn opened a line of credit with appellant FIA Card Services, N.A. (hereinafter AFIA Card Services@), agreeing to be bound by an arbitration agreement containing the following language:  AThis arbitration agreement is made pursuant to a transaction involving interstate commerce and shall be governed by the Federal Arbitration Act, 9 U.S.C. '' 1B16 (>FAA=).  Judgment upon any arbitration award may be entered in any court having jurisdiction.@  When a dispute arose, the parties participated in an arbitration proceeding and FIA Card Services received an arbitration award of $12,338.21 against Horn.  FIA Card Services sought confirmation and enforcement of the arbitration award by filing an original petition with the Harris County Court at Law Number 1, initiating this suit.

On its own motion, the trial court dismissed the case for lack of jurisdiction.  In its findings of fact and conclusions of law, the trial court determined, among other things, (1) FIA Card Services and Horn entered into a valid and binding agreement to arbitrate any claims or disputes relating to Horn=s account; (2) pursuant to the parties= agreement, the National Arbitration Forum conducted an arbitration proceeding and awarded FIA Card Services $12,338.21 against Horn; and (3) the Federal Arbitration Act, 9 U.S.C. '' 1B16 (AFederal Act@), governs the arbitration agreement and confirmation of the arbitration award.  Apparently concluding that section 9 of the Federal Act deprived it of subject-matter jurisdiction to confirm the award, the trial court dismissed the case.

II.  Issue and Analysis

On appeal, FIA Card Services argues in a single issue that the trial court had subject-matter jurisdiction to confirm the arbitration award and therefore improperly dismissed the case.  A court must have subject-matter jurisdiction to decide a case.  Tex. Ass=n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 443 (Tex. 1993).  The existence of jurisdiction is a question of law, which this court reviews de novo.  Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex.1998). 

Generally, the Federal Act applies to a written provision in a contract Aevidencing a transaction involving commerce@ to settle a dispute by arbitration.  9 U.S.C.A. ' 2 (West 2009).  The parties do not dispute that the Federal Act governs this matter.^[1]  When, as in this case, the parties expressly agree that their arbitration agreement shall be governed by the Federal Act, the parties are not required to establish that the transaction at issue involves or affects interstate commerce.  See In re Choice Homes, Inc., 174 S.W.3d 408, 412 (Tex. App.CHouston [14th Dist.] 2005, orig. proceeding).

Section 9 of the Federal Act provides in pertinent part:

If the parties in their agreement have agreed that a judgment of the court shall be entered upon the award made pursuant to the arbitration, and shall specify the court, then at any time within one year after the award is made any party to the arbitration may apply to the court so specified for an order confirming the award, and thereupon the court must grant such an order unless the award is vacated, modified, or corrected as prescribed in sections 10 and 11 of this title. If no court is specified in the agreement of the parties, then such application may be made to the United States court in and for the district within which such award was made.

9 U.S.C.A. ' 9 (2009).  The language of the parties= arbitration agreement provides that A[j]udgment upon any arbitration award may be entered in any court having jurisdiction.@  Under the unambiguous language of the agreement, the parties have not specified a court in which a party may seek rendition of judgment on an arbitration award.  In these circumstances, the parties, under section 9 of the Federal Act, may seek confirmation of an award in a United States court in and for the district within which such award was made.  See id; Palisades Acquisition XVI, LLC v. Chatman, C S.W.3d C,C, No. 14-08-00108-CV, 2009 WL 1660485, at *2 (Tex. App.CHouston [14th Dist.] June 16, 2009, no pet. h.); see also Mauldin v. MBNA Am. Bank, N.A., No. 02-07-00208-CV, 2008 WL 4779614, at *4 (Tex. App.CFort Worth Oct. 30, 2008, no pet.) (mem. op.).  AUnder this unambiguous language, a party may seek confirmation of the arbitration award in federal court but is not required to do so.@  Palisades Acquisition XVI, LLC, 2009 WL 1660485, at *2.

The Federal Act is enforced by both state and federal courts.  See Moses H. Cone Mem=l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 26 n.32, 103 S. Ct. 927, 942 n.32, 74 L. Ed. 2d 765 (1983); Palisades Acquisition XVI, LLC, No. 14-08-00108-CV, 2009 WL 1660485, at *3 (providing that the section 9 of the Federal Act does not limit subject-matter jurisdiction to the federal courts); see also Mauldin, 2008 WL 4779614, at *5 (same).  Under the unambiguous language of section 9, Congress does not confer exclusive jurisdiction upon federal courts as to arbitration agreements that fail to specify a court in which a party may seek rendition of judgment on the arbitration award. See 9 U.S.C.A. ' 9; Moses H. Cone Mem=l Hosp., 460 U.S. at 25B26 & n.32, 103 S. Ct. at 942 & n.32; Palisades Acquisition XVI, LLC, No. 14-08-00108-CV, 2009 WL 1660485, at *3.  Therefore, section 9 does not deprive the county court at law of subject-matter jurisdiction.

Under the Texas Government Code, Aa statutory county court exercising civil jurisdiction concurrent with the constitutional jurisdiction of the county court has concurrent jurisdiction with the district court in . . . civil cases in which the matter in controversy exceeds $500 but does not exceed $100,000 . . . as alleged on the face of the petition.@  Tex. Gov=t Code Ann. ' 25.0003 (Vernon Supp. 2009).  As alleged in this case, the amount in controversy exceeds $500 but does not exceed $100,000.  Though the Texas Government Code contains certain limitations concerning the jurisdiction of a Harris County civil court at law, none of these limitations apply to the case at hand.  See Tex. Gov=t Code Ann. ' 25.0003(b) (prohibiting jurisdiction of a statutory county court over causes and proceedings concerning roads, bridges, and public highways); Tex. Gov=t Code Ann. ' 25.1032(a) (Vernon 2004) (prohibiting jurisdiction over probate matters); Palisades Acquisition XVI, LLC, No. 14-08-00108-CV, 2009 WL 1660485, at *3.  Therefore, the trial court had subject-matter jurisdiction over this case.  See Palisades Acquisition XVI, LLC, No. 14-08-00108-CV, 2009 WL 1660485, at *3.  The trial court erred in dismissing this case. 

Accordingly, we sustain FIA Card Services=s sole issue on appeal, reverse the trial court=s judgment, and remand for further proceedings.

/s/      Kem Thompson Frost

Justice

Panel consists of Justices Frost, Brown, and Boyce.

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^[1]  FIA Card Services contends that the Federal Act applies.  Horn did not file an appellate brief in this case, and it is unclear from the record whether Horn appeared in the trial court below.