LDF Construction, Inc. v. Bryan

324 S.W.3d 137, 2010 Tex. App. LEXIS 1913, 2010 WL 1052863
CourtCourt of Appeals of Texas
DecidedMarch 10, 2010
Docket10-08-00315-CV, 10-08-00348-CV, 10-08-00407-CV
StatusPublished
Cited by18 cases

This text of 324 S.W.3d 137 (LDF Construction, Inc. v. Bryan) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
LDF Construction, Inc. v. Bryan, 324 S.W.3d 137, 2010 Tex. App. LEXIS 1913, 2010 WL 1052863 (Tex. Ct. App. 2010).

Opinion

OPINION

TOM GRAY, Chief Justice.

This is one of the last combinations of proceedings where a party has to pursue a mandamus proceeding if the Federal Arbitration Act (FAA) might be applicable and also pursue an interlocutory appeal if the Texas Arbitration Act (TAA) might be applicable. The invitation of the Texas Supreme Court has been acted upon. See Am. Std. v. Brownsville Indep. Sch. Dist. (In re D. Wilson Constr. Co.), 196 S.W.3d 774, 780 n. 4 (Tex.2006) (‘We again invite the Legislature, ‘[i]n the interests of promoting the policy considerations of rigorous and expedited enforcement of arbitration agreements, ... to consider amending the Texas Act to permit interlocutory appeals of orders issued pursuant to the Federal Act.’ ”) (citing Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 272 (Tex.1992)). Effective September 1, 2009, section 51.016 of the Civil Practice and Remedies Code was amended to allow an interlocutory appeal of an order denying a motion to compel arbitration under the FAA. See Tex. Civ. Prao. & Rem.Code Am § 51.016 (Vernon Supp.2009). These proceedings, however, were filed before the effective date of the new statutory provision.

In these proceedings, the appellants/re-lators have had to do things the hard way — file both an appeal and petitions for a writ of mandamus. It has made the task for both the trial court and this Court more complex due to multiple issues and methods necessary to insure that the proper procedural vehicle was used to obtain review. Because in this instance we conclude that the FAA applies, we dismiss the interlocutory appeal, LDF Construction, Inc. v. Bryan, No. 10-08-00315-CV. We conditionally grant the petitions for writ of mandamus to compel arbitration filed by LDF Construction, Inc. and Lynn D. Foster (LDF) and Mark Todd and Mark Todd Architects (Todd).

A Brief History

Sam Bryan, an orthodontist, contracted with Joyce Matlack, a California resident who specialized in dental-related interior designs, to provide interior design services for a new office for Bryan. Bryan then. contracted with Todd to develop a set of master and schematic plans to be designed according to the interior plans provided by Matlack. Three years later, LDF entered into an agreement with Bryan to build the new office. The construction of the office was to comply with the specifications and designs by Todd. Bryan’s contracts with LDF and Matlack contained arbitration *142 provisions, but the contract between Bryan and Todd did not.

When construction of the office did not go as expected, Bryan, his wife, and Sammy R. Bryan, DDS, P.A. (Bryan) sued LDF, Todd, and Matlack and Matlack/Van Every Design, Inc. (Matlack). 1 Todd, Matlack, and LDF each moved to compel arbitration. The trial court initially granted Matlack’s motion to compel arbitration. However, that ruling was withdrawn at the hearing on Todd’s and LDF’s motions. The trial court ultimately denied Todd’s and LDF’s motions to compel arbitration but did not rule on Matlack’s motion. That motion remains pending in the trial court. LDF and Todd filed separate notices of appeal of the trial court’s decision and filed separate petitions for a writ of mandamus. Both notices of appeal were filed in one proceeding, Tex.R.App. P. 12.2(c), whereas each mandamus was filed as a separate proceeding.

General Law of Arbitration

The Texas statutes governing arbitration of disputes are found in Chapter 171 of the Civil Practice and Remedies Code. See Tex. Civ. Prac. & Rem.Code Ann. §§ 171.001-171.098 (Vernon 2005). The FAA, which applies to “any maritime transaction or a contract evidencing a transaction involving commerce,” is found in title 9 of the United States Code. See 9 U.S.C. § 2.

In evaluating a motion to compel arbitration, a court must first determine whether a valid arbitration agreement exists, and then whether the agreement encompasses the claims raised. Am. Std. v. Brownsville Indep. Sch. Dist. (In re D. Wilson Constr. Co.), 196 S.W.3d 774, 781 (Tex.2006); see In re Dillard Dep’t Stores, Inc., 186 S.W.3d 514, 515 (Tex.2006) (per curiam). Whether a valid arbitration agreement exists is a legal question subject to de novo review. Id. Although the Texas Supreme Court has repeatedly expressed a strong presumption favoring arbitration, the presumption arises only after the party seeking to compel arbitration proves that a valid arbitration agreement exists. J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 227 (Tex.2003) (emphasis added). Courts must resolve any doubts about an arbitration agreement’s scope in favor of arbitration. In re FirstMerit Bank, N.A., 52 S.W.3d 749, 753 (Tex.2001).

Arbitration agreements are interpreted under traditional contract principles. J.M. Davidson, 128 S.W.3d at 227. If the trial court finds a valid agreement, the burden shifts to the party opposing arbitration to raise an affirmative defense to enforcing arbitration. Id. Absent a defense to enforcing the arbitration agreement, the trial court has no discretion but to compel arbitration and stay its own proceedings. In re J.D. Edwards World Solutions Co., 87 S.W.3d 546, 549 (Tex.2002) (per curiam).

The types of issues raised as a defense determine whether the arbitrator or the trial court resolves those issues. A court may determine a specific challenge to the validity of the arbitration agreement but a challenge to the validity of the contract as a whole, and not specifically to the arbitration agreement, must go to the arbitrator. Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 448-449, 126 S.Ct. 1204, 163 L.Ed.2d 1038 (2006); In re Labatt Food Serv., L.P., 279 S.W.3d 640, 647-648 (Tex.2009). See Prima Paint Corp. v. *143 Flood & Conklin Mfg. Co., 388 U.S. 395, 403-404, 87 S.Ct. 1801, 18 L.Ed.2d 1270 (1967) (claim of fraud in the inducement of arbitration clause itself may be adjudicated by court, but court may not consider claim of fraud in the inducement of the contract generally); In re Houston Pipe Line Co., 311 S.W.3d 449, 451 (Tex.2009) (“When a party disputes the scope of an arbitration provision or raises a defense to the provision, the trial court, not the arbitrator, must decide the issues.”); In re Morgan Stanley & Co., 293 S.W.3d 182

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Bluebook (online)
324 S.W.3d 137, 2010 Tex. App. LEXIS 1913, 2010 WL 1052863, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ldf-construction-inc-v-bryan-texapp-2010.