Timothy Erwin v. Scott Ferris

CourtCourt of Appeals of Texas
DecidedJune 30, 2011
Docket12-10-00273-CV
StatusPublished

This text of Timothy Erwin v. Scott Ferris (Timothy Erwin v. Scott Ferris) 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
Timothy Erwin v. Scott Ferris, (Tex. Ct. App. 2011).

Opinion

NO. 12-10-00273-CV

IN THE COURT OF APPEALS

TWELFTH COURT OF APPEALS DISTRICT

TYLER, TEXAS

TIMOTHY ERWIN, § APPEAL FROM THE 294TH APPELLANT

V. § JUDICIAL DISTRICT COURT

SCOTT FERRIS, APPELLEE § VAN ZANDT COUNTY, TEXAS

MEMORANDUM OPINION Timothy Erwin appeals the trial court’s summary judgment entered in favor of Scott Ferris. In three issues, Erwin argues that the trial court erred in denying his motion to compel arbitration and in granting Ferris’s motion for summary judgment. We affirm.

BACKGROUND Scott Ferris and Timothy Erwin are neighbors. In the late 1990s, through separate transactions, Ferris bought a house and Erwin bought the adjoining property and barn from Leonard and Ann Foster. Erwin believed that the land he purchased granted him an easement in Ferris’s driveway by which he could access his barn. For several years, Erwin used Ferris’s driveway consistent with this belief. By June 2006, Ferris no longer wanted Erwin to use his driveway. Believing that no easement existed, Ferris sued Erwin for monetary damages and injunctive relief. Erwin countersued. The trial court ordered that the case be mediated. At the mediation, the parties reached a compromise, and both Ferris and Erwin signed a settlement agreement wherein Ferris agreed to sell his house “as is” to Erwin for $127,500.1 Among other provisions of the settlement agreement, Erwin could, at his election, have the house inspected. Further, the real estate contract was required to include reasonable and customary terms regarding the parties’ ability to terminate the contract or submit to arbitration if the house was determined not to be in substantially good condition. Erwin’s counsel agreed to draft a real estate contract pertaining to the sale. The parties sought to complete the transaction by May 30, 2007. However, Erwin did not send Ferris a proposed real estate contract until July 11, 2007. The proposed contract included an arbitration clause, but neither party signed the proposed contract. Thereafter, Erwin had the house inspected. The inspector noted that the house needed significant repairs. Erwin argued that the settlement agreement required Ferris to pay for the repairs because the property was not in “substantially good condition” without the repairs being made. Ferris responded that Erwin agreed to purchase the property “as is,” and, as a result, could either purchase the property without the repairs being made or terminate the settlement agreement. After it became apparent that the parties were at an impasse, Erwin amended his counterclaim and alleged that Ferris breached the settlement agreement. Ferris responded by amending his petition and including an alternative allegation that Erwin breached the settlement agreement. Ferris also filed an amended answer to Erwin’s counterclaim in which he alleged that there was no valid contract between the parties and that his performance under the alleged contract was excused because of a prior material breach by Erwin. Subsequently, Erwin filed a motion to compel arbitration. The trial court denied Erwin’s motion to compel arbitration because Erwin failed to establish the existence of an arbitration agreement that governed the dispute. Erwin continued to pursue the matter before the trial court. Erwin again amended his petition to include only a claim that Ferris breached the settlement agreement. In June 2009, Ferris filed a combined no evidence and traditional motion for summary judgment concerning both his claims for affirmative relief and Erwin’s claims against him. Erwin responded. On May 28, 2010, the trial court granted Ferris’s motion for summary judgment, but

1 A “Memorandum of Settlement” was signed by both parties and their attorneys at the mediation. A copy of the “Memorandum of Settlement” is attached as Appendix 1.

2 declined to award Ferris damages or attorney’s fees.2 Erwin filed a motion for new trial, which was denied. This appeal followed.

ARBITRATION In his third issue, Erwin argues that the trial court erred by denying his motion to compel arbitration. Ferris responds that (1) there is not a valid and enforceable arbitration agreement, (2) alternatively, the arbitration agreement does not encompass Ferris’s claims against Erwin, and (3) Erwin waived the issue by failing to pursue an interlocutory appeal.3 Standard of Review and Governing Law The standard of review for determining a trial court’s ruling on a motion to compel arbitration is abuse of discretion. See Perry Homes v. Cull, 258 S.W.3d 580, 598 (Tex. 2008). We defer to a trial court’s factual findings if they are supported by the evidence. See id. Because a trial court has no discretion to apply the law incorrectly, we do not defer to the trial court on questions of law. Id. Arbitration agreements are valid, irrevocable, and enforceable to the same extent as any other contract. See 9 U.S.C.A. § 2 (2011). We first determine whether the arbitration agreement satisfies Texas law governing contract formation. See In re Poly-America, L.P., 262 S.W.3d 337, 347 (Tex. 2008); see also In re Morgan Stanley & Co., 293 S.W.3d 182, 187 (Tex. 2009) (courts have authority and responsibility to determine existence of a contract containing relevant arbitration agreement). Once we determine the existence of an enforceable arbitration agreement, the strong presumption from federal law in favor of arbitration requires that doubts be resolved in favor of arbitration. See Poly-America, L.P., 262 S.W.3d at 348. Unless disputed issues of fact require a full evidentiary hearing, a trial court should decide a motion to compel arbitration summarily. Id. at 355. Ordinarily, the hearing at which a motion to compel arbitration is decided involves application of the arbitration agreement terms to

2 Although the judgment does not specifically address Ferris’s request for damages, it includes unequivocal language that indicates finality by stating, “By signing this [order], it is the intent of the [trial court] to dispose of all pending claims asserted in this cause by [Ferris] against [Erwin] and [Erwin’s] counterclaims against [Ferris] and that the judgment is final for purposes of appeal.” Thus, the judgment is final, and we have jurisdiction over this appeal. See In re Burlington Coat Factory Warehouse of McAllen, Inc., 167 S.W.3d 827, 830 (Tex. 2005). 3 We have addressed Ferris’s arguments in the order in which they were presented. Even had we considered the waiver issue first and determined that Erwin did not waive his third issue, the outcome would not differ. In the interest of brevity, we have limited our analysis to only the issue of the existence of a valid and enforceable arbitration agreement. 3 undisputed facts amenable to proof by affidavit. Jack B. Anglin Co., Inc. v. Tipps, 842 S.W.2d 266, 269 (Tex. 1992). Thus, the trial court generally decides whether to compel arbitration on the basis of affidavits, pleadings, discovery, and stipulations. Id. However, if the facts are disputed, the trial court must conduct an evidentiary hearing to determine the disputed facts. Id. The elements necessary to form a binding contract are (1) an offer, (2) acceptance of the offer, (3) a meeting of the minds, (4) the parties’ consent to the terms, (5) execution and delivery with the intent that it be mutual and binding, and (6) consideration. Advantage Physical Therapy, Inc. v. Cruse, 165 S.W.3d 21, 24 (Tex. App.–Houston [14th Dist.] 2005, no pet.).

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Timothy Erwin v. Scott Ferris, Counsel Stack Legal Research, https://law.counselstack.com/opinion/timothy-erwin-v-scott-ferris-texapp-2011.