ACCEPTED
03-15-00422-CV
6850555
THIRD COURT OF APPEALS
AUSTIN, TEXAS
9/9/2015 3:18:35 PM
JEFFREY D. KYLE
CLERK
No. 03-15-00422-CV
RECEIVED IN
3rd COURT OF APPEALS
IN THE AUSTIN, TEXAS 9/9/2015 3:18:35 PM
THIRD COURT OF APPEALS JEFFREY D. KYLE Clerk
AT AUSTIN, TEXAS
Shakeel Mustafa,
Appellant September 10, 2015
v.
Felix Rippy,
Appellee
Appealed from Cause No. 15-0708-CC4 in the County Court at Law Number Four, Williamson County, Texas
Appellant’s Motion for Rehearing
APPELLANT REQUESTS ORAL ARGUMENT
Christopher D. Osborn
State Bar No. 24037221
Osborn Law Firm, P.C.
1019 Cecelia St.
Taylor, Texas 76574
512-275-6593
512-309-5317 fax
chris@osbornpc.com
Attorney for Appellant
TABLE OF CONTENTS
TABLE OF CONTENTS . . . . . . . . 2 INDEX OF AUTHORITIES . . . . . . . . 2 ISSUES PRESENTED FOR REVIEW . . . . . . 4 STATEMENT OF FACTS . . . . . . . . 4 ARGUMENT . . . . . . . . . . 6 Issue One. This court has jurisdiction to consider the interlocutory appeal of Appellant related to the denial of his motion to compel arbitration pursuant to the AAA Consumer Arbitration Rules.
PRAYER . . . . . . . . . . . 10 CERTIFICATE OF SERVICE . . . . . . . . 11 APPENDIX . . . . . . . . . . 12
INDEX OF AUTHORITIES
Federal Code: 9 U.S.C. § 16 . . . . . . . . . 3, 4 Texas Statutes: TEX. CIV. PRAC. & REM. CODE § 51.016 . . . . . 3, 4 TEX. CIV. PRAC. & REM. CODE § 154.027 . . . . 4 Texas Case Law: CMH Homes v. Perez, 340 S.W.3d 448 (2011) . . . . 4 Little v. Tex. Dep't of Crim. Justice, 148 S.W.3d 374 (Tex.2004) . 4
3
ISSUES PRESENTED FOR REVIEW Issue One. This court has jurisdiction to consider the interlocutory appeal of
Appellant related to his motion to compel arbitration pursuant to the AAA Consumer Arbitration Rules.
STATEMENT OF FACTS
Rippy filed a collection lawsuit against Mustafa, a former client of Rippy.
Rippy’s original petition requested Mustafa be jailed for 180 days, fined up to $500, and confined in the county jail until Mustafa paid the alleged debt. Each party submitted motions to compel arbitration, with the difference being that Mustafa requested the AAA Consumer Arbitration Rules be applied. The Honorable John McMaster granted Rippy’s motion to compel arbitration and denied Mustafa’s motion. Mustafa’s subsequent motion to stay the case pending arbitration was granted, and the Honorable Gary Harger was appointed arbitrator with authority to decide all questions of law and fact.
ARGUMENTS AND AUTHORITIES Section 51.016 of the Texas Civil Practice and Remedies Code provides that
a party may appeal a judgment or interlocutory order "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. Section 16 of the FAA provides that “(a) An appeal may be taken from (1) an order (A) refusing a
4
stay of any action under section 3 of this title, (B) denying a petition under section 4 of this title to order arbitration to proceed, (C) denying an application under section 206 of this title to compel arbitration . . . .” 9 U.S.C. § 16.
Civil Practice and Remedies Code section 51.016 expressly adopts federal law. Thus, an interlocutory appeal is permitted only if it would be permitted under the same circumstances in federal court under section 16. CMH Homes v. Perez, 340 S.W.3d 448-9 (2011) (citing Little v. Tex. Dep't of Crim. Justice, 148 S.W.3d 374, 381-82 (Tex.2004) (examining federal law when interpreting state statute that incorporated federal statute)).
In this case, Appellant is not contesting the existence of an arbitral agreement.
To the contrary, Appellant is appealing the denial of his motion to compel mediation then arbitration pursuant to the agreement and AAA Consumer Arbitration Rules. The agreement between the parties provides “THE PARTIES AGREE TO MEDIATE ALL SUCH DISPUTES PRIOR TO ARBITRATION.” (emphasis in original). Appellant’s motion to the trial court requested mediation and arbitration be initiated following the AAA Consumer Arbitration Rules, pursuant to the Federal Arbitration Act (9 U.S.C. sec 1 et seq.) and/or pursuant to Texas Civil Practice & Remedies Code section 154.027.
The denial of Appellant’s motion to compel arbitration constitutes an order from which an interlocutory appeal is authorized under the FAA. 9 U.S.C. § 16.
5
Thus, Appellant requests this court reconsider its ruling that it does not have jurisdiction to hear this interlocutory appeal. Therefore, Appellant requests the opportunity to fully address this issue through argument to this Court.
PRAYER
For the reasons stated in this motion, Appellant asks the Court to grant this motion for rehearing, withdraw its opinion, recognize it has jurisdiction, and allow Appellant to fully brief this issue.
Respectfully submitted,
/s/ Chris Osborn .
Christopher Osborn
State Bar No. 24037221
Osborn Law Firm, P.C.
1019 Cecelia St.
Taylor, TX 76574
512-275-6593
512-309-5317
chris@osbornpc.com
Attorney for Appellant
6
CERTIFICATE OF COMPLIANCE In accordance with the Texas Rules of Appellate Procedure 9.4, the undersigned attorney of record certifies that this brief contains 14-point typeface for the body of the document, 12-point typeface for footnotes in the brief, and contains 510 words as indicated by the word count software, excluding those words identified as exempt from the word count under the rule and was prepared on Microsoft Word.
/s/ Chris Osborn .
Christopher Osborn
CERTIFICATE OF SERVICE
I certify that a copy of Appellant’s Brief was served on Appellee, Felix Rippy, via electronic mail before 5:00 p.m. this 9th day of September, 2015.
/s/ Chris Osborn .
Christopher Osborn
CERTIFICATE OF CONFERENCE
I certify that I contacted Appellee, Felix Rippy, via electronic mail to felixrippy@aol.com on September 9, 2015, and he is opposed to this motion.
/s/ Chris Osborn .
Christopher Osborn
APPENDIX
EXHIBIT 1 – APPELLANT’S MOTION TO COMPEL ARBITRATION PURSUANT TO THE AAA CONSUMER ARBITRATION RULES (Exhibit 1 includes the arbitration agreement as an attachment)
APPENDIX
Cause No. 15-0708-CC4
FELIX RIPPY, § IN THE COUNTY COURT Plaintiff § §
v. § AT LAW NUMBER 4 §
SHAKEEL MUSTAFA, § Defendant § WILLIAMSON COUNTY, TEXAS
DEFENDANT’S OBJECTION TO PLAINTIFF’S ASSSIGNMENT, AND DEFENDANT’S MOTION TO COMPEL MEDIATION THEN ARBITRATION PURSUANT TO AAA CONSUMER ARBITRATION RULES AND IN THE ALTERNATIVE MOTION TO DISMISS
1. Shakeel Mustafa, Defendant, asks the Court to refer the dispute between Rippy & Taylor, P.C. and Shakeel Mustafa, Individually, to alternative dispute resolution (ADR) under the authority of Texas Civil Practice & Remedies Code and pursuant to the Federal Arbitration Act. Defendant alternatively requests that Plaintiff’s petition be dismissed for failure to cure defects noted in Defendant’s Special Exceptions and due to the defective purported assignment.
INTRODUCTION
2. Plaintiff, Felix Rippy, Individually, filed suit against Shakeel Mustafa. The attorney- client agreement attached to Plaintiff’s Original Petition is between Rippy and Taylor, P.C. and Mr. Mustafa. After Defendant filed special exceptions objecting to the case filed on behalf of Felix Rippy, Individually, and after this Court’s order allowing Plaintiff to re-plead on June 12, 2015, the style of this case remains filed on behalf of Felix Rippy, Individually. Plaintiff failed to cure the defects, instead alleging that all claims have been assigned to him, individually.
Defendant’s Motion to Compel Mediation and Arbitration Pursuant to AAA Consumer Arbitration Rules Page 1
OBJECTION TO PURPORTED ASSIGNMENT 3. Defendant objects to Plaintiff’s purported assignment of the underlying contract from the professional corporation to himself, individually. The underlying contract, which is attached hereto and incorporated herein as Exhibit “1” provides in paragraph five that “[a] referral to an attorney outside the firm may require a separate contract with that attorney and will not be done without Client’s consent.” (emphasis added). Thus, the purported assignment here is improper because the agreement specifies that if it is to be sent “outside the firm [Rippy & Taylor, P.C.],” it requires “the Client’s consent.” 4. Assignments should be permitted or prohibited based on the likely effect on society, and in particular, on the legal system. Employing a public policy analysis, the majority of courts in this country have concluded that at least some claims arising out of the attorney- client relationship are not assignable. Vinson & Elkins v. Moran, 946 SW 2d 381 (Tex.App. Houston [14th Dist.] 1997) (analyzing malpractice claims).
PLAINTIFF’S REQUEST FOR CONTEMPT FINDINGS SHOULD BE DISMISSED 5. Plaintiff mistakenly claims that the final decree of divorce between Mr. Mustafa and his ex-wife constitutes a secured judgment in the amount of $17,500 against Mr. Mustafa, individually. However, due process requires this issue to be adjudicated before it should be treated as a violation of any court order. The phrase relied on by Plaintiff is found in the underlying divorce decree requiring each litigant pay their own attorney’s fees, but this does not equal language that supports a finding of contempt. The Texas Supreme Court analyzed this issue in Ex parte Chambers, 898 S.W.2d 257, 259 (Tex.1995): “A court order is insufficient to support a judgment of contempt only if its interpretation requires inferences or conclusions about which reasonable persons might differ.” MacCallum, 807 S.W.2d at 730.
Defendant’s Motion to Compel Mediation and Arbitration Pursuant to AAA Consumer Arbitration Rules Page 2
The existence of reasonable alternative constructions of a court order will prevent enforcement of the order. See, e.g., Ex parte Crawford, 684 S.W.2d 124 (Tex.App.Houston [14th Dist.] 1984, orig. proceeding) (holding an obligor in contempt who knew with certainty he was to pay one of two amounts of child support but ignored the order altogether). Here, there was no order to pay a specific amount. In fact, Defendant will testify that no invoice was ever received by him and that this suit is in retaliation for filing a grievance with the State Bar of Texas.
PLAINTIFF’S CLAIMS SHOULD BE DISMISSED FOR FAILURE TO CURE DEFECT OF PARTIES 6. Plaintiff has not cured the defects noted in Plaintiff’s special exceptions and there remains a defect in the parties. Plaintiff’s claim should be dismissed in its entirety without prejudice.
MOTION TO COMPEL MEDIATION THEN ARBITRATION WITH AAA CONSUMER ARBITRATION RULES
7. In the event the Court does not dismiss this suit, Defendant requests that the Court order that Plaintiff follow the terms of the agreement requiring mediation. Defendant requests that the Court order mediation pursuant to the agreement that provides “THE PARTIES AGREE TO MEDIATE ALL SUCH DISPUTES PRIOR TO ARBITRATION.” (emphasis in original). Defendant requests the Court order mediation pursuant to Texas Civil Practice & Remedies Code section 154.023. 8. If mediation does not resolve the dispute, Plaintiff asks this Court to order binding arbitration between Rippy and Taylor, P.C. and Defendant, following the AAA Consumer Arbitration Rules, pursuant to the Federal Arbitration Act (9 U.S.C. sec 1 et seq.) and/or pursuant to Texas Civil Practice & Remedies Code section 154.027.
Defendant’s Motion to Compel Mediation and Arbitration Pursuant to AAA Consumer Arbitration Rules Page 3 9. This case is appropriate for referral to ADR because there is a binding arbitration agreement between Defendant and Rippy and Taylor, P.C.
ADDITIONAL SPECIAL EXCEPTIONS 10. Defendant specially excepts to Plaintiff’s claim that “Felix Rippy … has individual claims against Shakeel Mustafa, as well” in that there is not specificity as to the basis of these purported claims that Plaintiff contends exist in addition to the contractual claims of Rippy and Taylor, P.C. If there are indeed other facts or causes of action that will be asserted, the question of whether those claims are arbitrable will require a separate inquiry because there is no arbitration agreement between Felix Rippy, Individually, and Defendant.
CONCLUSION
For these reasons, Defendant asks the Court to dismiss this suit or render judgment that plaintiff take nothing, assess costs and fees against plaintiff, and award all other relief to which defendant is entitled. Defendant asks the Court to strike the defective portions of Plaintiff’s pleading. Alternatively, Defendant asks this Court to compel mediation followed by binding arbitration, if necessary, between Rippy and Taylor, P.C. and Defendant, following the AAA Consumer Arbitration Rules.
RESPECTFULLY SUBMITTED,
OSBORN LAW FIRM, P.C.
By: /s Chris Osborn .
Christopher D. Osborn
State Bar No. 24037221
1019 Cecelia Street
Taylor, Texas 76574
512-275-6593
512-309-5317 fax
chris@osbornpc.com
Defendant’s Motion to Compel Mediation and Arbitration Pursuant to AAA Consumer Arbitration Rules Page 4
CERTIFICATE OF SERVICE
I certify that a true and correct copy of the above and foregoing document has been served on each attorney of record or party in accordance with the Texas Rule of Civil Procedure 21a on this 19th day of June 2015.
/s/Chris Osborn .
Christopher D. Osborn
Felix Rippy ❒ hand-delivery 3000 Joe DiMaggio, Ste. 3 Round Rock, TX 78665 x❒ telecopy 512-310-9500 512-310-2580 fax ❒ first class mail
❒ certified mail, return receipt requested
Defendant’s Motion to Compel Mediation and Arbitration Pursuant to AAA Consumer Arbitration Rules Page 5
ATTORNEY/CLIENT ENGAGEMENT AGREEMENT (Hourly Basis)
2. Client, in consideration of services to be re nd e red by Attorn_>;Y to Client, retains Attorney to represent him/her as attorney in connection with �v� s bP,,f-c (-e.. r M ( , J4v-v1'c , .., I/·()�� ( - R: / 1'1..-1 •
/ c..�"" ...kd
� V\.?I.I '1 <'.-+- �i's (OV'<."'f S'tq)i,.) + �u '"' ""' Wo IF - I<c ,L, c"'1l('(', r'.., 1(' t\>' 1iier - c �(l.� of�y I� It is understood and a gre ed by the parties that Attorney's re prese n tation ends upon the ent y a final order �4'-1 � . )Dd-w.-,'4
disposing of the Client's case and does 11ot i n clud e the filing of any post -t ri al motions 01· appe i;J 7�0 - soo + 2ro """- 11tY-rea.o � i...q��
r�1-1dicMs-L\..- �rj'
3. If, in the future, Client desi1·es Attorney to represent Clienr in any other matter, that will be the subject of additional discussions nnd an nclditionnl engagement ngreement. Attorney's fee will include only services in connection with the matter listed in Paragraph 2 above.
Client and Attorney agr·ee:
4. A ttorn ey will devote his professio118I abilities to the matter, stri v e to keep Client informed of significant developments in t his case and be reasonably available to answer inquiries. Client agrees to fully coope rate with Attorney, including but not limited to k eepi n g Attorney advised of all developments relate d to this m a tter, informing Attorney prnrnptly of any c ha n g e in Client's a dd res s or telephone number, and promptly responding to Artorney·s inquir ies . Where applicable, ne ith er Attorney nor Client will settl e the case without the othe r's written a p p roval .
5. Client empowers Attorney to take all ste ps in said matter d eemed by A ttorney to be advisable. Client understands and agrees t ha t Attorney wi 11, to the extent Attorney believes it to be reasonable, c oo pe rate with any opposing attorney concerning set t i n gs for trial or hearing, sched uling d epositions or meet ings , and w het h er to request or a gree to continuances or d elay s . The undersigned attorney may deem it advisable to refer Client's case to an other attorney with in the firm of Rippy & Taylor, PC, or to an a ttorn ey outside the firm. A referral to an attorney outside t he firm may require a separate contract with that attorney and will not be done without Client's co11se11t.
6. C lient agrees t o compensate Attorney for his services at th te of$ SOO per hour for the time which is devoted to Client's case wit h a m i n i mum fee of$ 3sc:io ci.e"A which sha 11 be considered earned at the t i me Attorney commences work 011 Cl ie nt ' s case. here applicable, this minimum fee is inten ded to c o m pen s a t e Attorney for the preparation and fi ling of initial pl ead in gs , for all o ca tin g the time and resources of Attorney and the staff of the law firm to Client's case, for the n ature and complexity of Client ' s case and the experience of the Attorney hand Ii rig the matter and to compensate Attorney for the potentiality that, by accepting this employment, Attorney may also be precluded from accepting other employment. From t i me to time it may be n e c essary for other memb ers of the law firm to assist in the Client ' s matter, and Client agrees to c ompens at e Attorney for these services at the fol l o wi ng rates:
Page I of 3
Partner attorney: $300/hr
Legal assistant $ 75/hr
Client agrees to pay to Attorney all costs and disbursements incurred in said matter. For th e following expenses, and no others, Attorney will charge a per case flat fee of $25.00: (I) long distance telephone ch arges; (2) in-office photocopy ex p e nses; (3) fir s t class postage (not certified or priority maiI); and (4) facsimile c harg es All other expenses will be bi ll ed to Clie nt in the actual amount inc urre d . .
7. Cl ien t will pay A tto rney the sum Agre ement .
of
A ttorney will not take any action t Jeo�.e.
</ as a retainer at the time of execution of this til th retainer is received. The reta iner will be deposited in Attorney's trust ac cou nt , anci Atto rney will clrnw ag ain st those funds to satisfy Attorney's monthly statements, copies of which will be sent to Client for C lient s information. Upon d ep l e t ion of the retainer, '
the C lient agrees to d e posit an addi ti o nal retainer 111 an amoun t at le ast equal to the original re ta iner into Attorney's trust ac co unt . I fan additional retainer fee is required Client agrees to pay the amount required ,
within ten ( 10) days of Attorney s request.
' Any funds remain i n g in the trust accou nt at the end of the representation will be rerurned to Client at the time of the next billing period following termination of representation. This retainer fee is not necessarily t he total cost for the services of the Attorney. The total cost of legal services may exceed the r·etainer fee amount.
8. C l i ent has the righ t to cancel this Agreement a11cl termi na te Attorney's representation at any time by written notice to Attorney. Clie11t understands that Attorney has the right to cancel this Agreement and withdraw from representi ng CI ien t if any of Attorney's invoices are not paid by CIient with in 30 days of the date that Attorney sends them to CI ien t ; if Client fai Is to d eposit additional i-etainer fu nd s as r eq u i re d by P aragra ph 7; if the Client d etermin es not to follow the Attorney s advice; fai Is to communicate with the '
Attorn ey ; or if Attorney concludes for any other re<Json that Attorney is unable to rep1·esent Client. Attorney w i ll provide wr i tten notice in the event that Attorney decides to withdraw from representation.
9. In the event any legal action is taken to enforc e this Agreement, Client consents to jurisdiction of the s ta te of Texas and venue in Williamson County, Texas, and to all disagreements' being arbitrated pursuant to A.A.A arbitration ruies, CLIENT AND ATTORNEY AGREE THAT ALL DISPUTES ARJSING OUT OF ATTORNEY'S REPRESENTATION OF CLIENT OR FEES CHARGED TO CLIENT SHALL BE ARBITRATED IN A BINDING ARIHTRATION BEFORE AN ARBITRATOR IN WIL LIA MSON COUNTY, TEXAS. UNLESS AN ARBITRATOR IS AGREED UPON BY THE PARTIES, THE ARBITRATOR SHALL BE APPOIN TED BY THE .JUDGE OF A COURT OF RECORD SITTING IN WILLIAMSON COUNTY, TEXAS. PRIOR TO ARBITRATION, CLIENT AGREES TO SUBMIT ANY COMPLAINTS REGARDING ATTORNEY'S REPRESENTATION OR DISPUTES REGARDING ATTORNEY'S FEES TO ATTORNEY IN WRITING. THE PARTIES AGREE TO MEDIATE ALL SUCH DISPUTES PRIOR TO ARBITRATION.
There are advantages and disadv anta ges to arbitration as c ompar ed to a judicial resolution of disputes: 1) the cost and time of an arbitration is frequently less than that associated with a lawsuit; 2) the level of discovery may be reduced: 3) the ru l e s of evidence may be relaxed; 4) the level of privacy in the arbitration process is greater than that found in courts; 5) significant ri gh ts are waived in an arbitration, i ncludi n g the right to a jury trial and the right to a judicial appeal because arbitration decisions can be challenged only on limited grc1u11cls. Arbitrators may allocate costs or fees in an arbitration as well as a wa rding monetary relief to a party.
Page 2 of 3
10. Cli ent and Attorney agree that this Agreement is the entire agreement between them regarding the matters set forth herein and supercedes any prior oral or written discussions 01· agreements between them. This Agreeme n t can only be amended by a subseciuent written document signed by both Client and Attorney.
FAVORABLE OUTCOME NOT GUARANTEED
11. Each case is different. Client understands that Attorney has made no representation concerning the successful termination of the claim or claims relating to L11e matter in controversy or the favorable outcome of any legal ac t ion that is or may be filed.
DATED:
Rippy & Taylor, PC
5YA !Z f EL cuENT
Page 3 of 3
OSBORN LAW FIRM, P.C.
www.OsbornPC.com
1019 Cecelia Street, Taylor, Texas 76574 512-275-6593 | 512-309-5317 fax
_________________________________________________________________________________________________________
Christopher D. Osborn, Esq.
chris@osbornpc.com
VIA ELECTRONIC FILING September 8, 2015
Jeffrey D. Kyle Clerk of the Court Third Court of Appeals P.O. Box 12547 Austin, TX 78711
Re: Notice of Appearance | Case No. 03-15-00422-CV | Mustafa v. Rippy Dear Mr. Kyle:
This letter is notice of appearance that I have been retained to represent Appellant, Shakeel Mustafa, related to this appeal.
Very truly yours,
/s/ Chris Osborn
Christopher D. Osborn