in Re: Al Cardenas Masonry, Inc.

• Court: Court of Appeals of Texas
• Decided: October 6, 2005
• Docket: 13-05-00168-CV
• Status: Published

Opinion

                             COURT OF APPEALS

                     THIRTEENTH DISTRICT OF TEXAS

                         CORPUS CHRISTI - EDINBURG

                                      NUMBER 13-04-516-CV

AL CARDENAS MASONRY, INC.,                                        Appellant,

                                                             v.                               

LANDMARK ORGANIZATION, L.P., ET AL.,                                 Appellees.

                                      NUMBER 13-05-168-CV

                             IN RE: AL CARDENAS MASONRY, INC.

          On petition for writ of mandamus and on appeal from

                   the 370th District Court of Hidalgo County, Texas.

                               MEMORANDUM OPINION

           Before Chief Justice Valdez and Justices Castillo and Garza

                            Memorandum Opinion by Justice Garza          

Al Cardenas Masonry, Inc. (ACardenas@) has filed a petition for writ of mandamus and an interlocutory appeal that each challenge the trial court=s refusal to compel arbitration of claims brought against Cardenas by the Pharr-San Juan-Alamo Independent School District (APSJA-ISD@), Landmark Organization, L.P., Landmark Organization, Inc., and Landmark Organization of Texas, Inc. (collectively ALandmark@).  Cardenas seeks to compel arbitration under both the Federal Arbitration Act (AFAA@) and the Texas General Arbitration Act (ATGAA@).  Its pursuit of parallel proceedings before this Court is therefore appropriate.  See Serv. Corp. Int=l v. Lopez, 162 S.W.3d 801, 806 (Tex. App.CCorpus Christi 2005, orig. proceeding).  For the reasons that follow, we deny all relief sought by Cardenas.

I.  Petition for Writ of Mandamus

Our first task is to determine which arbitration act applies to this case.  See id.  The FAA Aapplies to all suits in state or federal court when the dispute concerns >a contract evidencing a transaction involving commerce.=@  Jack B. Anglin Co., Inc. v. Tipps, 842 S.W.2d 266, 269B70 (Tex. 1992) (orig. proceeding) (quoting 9 U.S.C.S. ' 2 (2000)); In re Profanchik, 31 S.W.3d 381, 384 (Tex. App.CCorpus Christi 2000, orig. proceeding).  The United States Supreme Court has held that the word Ainvolving@ in the FAA is broad and the functional equivalent of Aaffecting,@ signaling Congress=s intent to exercise its Commerce Clause power to the fullest.  Allied‑Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 268 (1995); L&L Kempwood Assocs., L.L.P., v. Omega Builders, Inc., 9 S.W.3d 125, 127 (Tex. 1999) (orig. proceeding) (per curiam).  The transaction must in fact involve interstate commerce.  Allied‑Bruce Terminix, 513 U.S. at 281.  The FAA does not require a substantial effect on interstate commerce; rather, it requires only that commerce be involved or affected.  L&L Kempwood Assocs., 9 S.W.3d at 127.  A party who alleges interstate commerce may show it in several ways:  (1) location of headquarters in another state, (2) transportation of materials across state lines, (3) manufacture of parts in a different state, (4) billings prepared out of state, and (5) interstate mail and phone calls in support of a contract.  See Stewart Title Guar. Co. v. Mack, 945 S.W.2d 330, 333 (Tex. App.CHouston [1st Dist.] 1997, orig. proceeding); see also Anglin, 842 S.W.2d at 270.  If a trial court erroneously denies a party=s motion to compel arbitration under the FAA, the movant has no adequate remedy at law and is entitled to a writ of mandamus.  Lopez, 162 S.W.3d at 808. 

Cardenas provided the trial court with no evidence to establish the applicability of the FAA.  Instead, Cardenas made the following argument in its motion to compel arbitration:

Contrary to the United States Supreme Court, the Texas Supreme Court has held that the Federal Arbitration Act (FAA) applies to every transaction affecting interstate commerce; since every transaction affects interstate commerce, every arbitration clause in Texas is arbitrable under the FAA.  The United States Supreme Court, clarifying its prior precedent, has held that a substantial effect on interstate commerce is required.  The Texas Supreme Court has completely failed to explain why it can ignore the dictates of the United States Supreme Court; apparently, it believes that one interstate commerce clause applies in Texas, and a different one applies in the remaining 49 states.

(emphasis in original) (internal citations omitted).  Without making further argument regarding the FAA=s applicability, Cardenas then proceeded to argue that arbitration could be compelled under the FAA.  Cardenas concluded its motion with the following statement:

Arbitration is akin to radioactive plutonium; it irradiates everything which it touches.  Indeed, arbitration clauses are so powerful that they cause the Texas Supreme Court to rewrite the United States Constitution, and to ignore the United States Supreme Court as the final arbitrator of the law of the land and the United States Constitution.  By deciding to sue the subcontractors directly, [PSJA-ISD] is irradiated by the arbitration clause.  Thus, this controversy must be sent to arbitration. 

In its petition for writ of mandamus, Cardenas takes a similar approach to arguing for arbitration under the FAA:  ABecause of the patent uncertainty in whether the underlying controversy is covered by the Federal Arbitration Act (especially in light of the Texas Supreme Court=s refusal to follow the dictates of the United States Supreme Court), this original proceeding resulted.@

We will reject Cardenas=s argument and will not hold that the FAA applies to every arbitration clause in Texas.  Nor do we find its attack on the Texas Supreme Court helpful.  Cardenas has failed to produce any evidence of the FAA=s applicability, and we are therefore unable to conclude that it applies in this case.  See id. (AA party seeking to compel arbitration must present sufficient evidence to establish its right to arbitrate under the FAA.@) (citing Cantella & Co. v. Goodwin, 924 S.W.2d 943, 944 (Tex. 1996) (orig. proceeding) (per curiam)).  Accordingly, Cardenas=s petition for writ of mandamus is denied.

II.  Interlocutory Appeal

Next, we consider whether Cardenas is entitled to relief on its interlocutory appeal under the TGAA.  Cardenas concedes that it never executed an agreement to arbitrate or any other agreement with PSJA-ISD.  It nevertheless contends that PSJA-ISD can be compelled to arbitrate based on an agreement to arbitrate that Cardenas executed with Landmark as part of a subcontract that directly benefitted PSJA-ISD.  In its motion to compel arbitration of the claims brought by PSJA-ISD and Landmark, Cardenas assured the trial court that it Awill present affidavit evidence of the existence of an arbitration agreement between it and Landmark.@  No evidence was attached to Cardenas=s motion to compel arbitration, and there is no indication in the record that Cardenas ever produced the promised evidence or any other evidence in support of its motion.  Given the absence of evidence to support Cardenas=s motion, this Court cannot conclude that the trial court abused its discretion in denying it.  See In re C & H News Co., 133 S.W.3d 642, 645 (Tex. App.CCorpus Christi  2003, orig. proceeding).  Accordingly, we overrule the sole issue raised in Cardenas=s interlocutory appeal.

_______________________

DORI CONTRERAS GARZA,

Justice

Memorandum Opinion delivered and

filed this the 6th day of October, 2005.