Opinion
NO. 01-16-00376-CV
07-13-2017
CURTIS L. TERRELL, JR., TANYA A. WALL, AND LORNA K. FINCH, Appellants v. ANGELA T. PRICE AND KEVIN HALE, Appellees
On Appeal from the 151st District Court Harris County, Texas
Trial Court Case No. 2015-15566
MEMORANDUM OPINION
Appellants, Curtis L. Terrell, Jr., Tanya A. Wall, and Lorna K. Finch, challenge the trial court's order denying their motion to compel arbitration in their suit against appellees, Angela T. Price and Kevin Hale, for trespass to try title. In their sole issue, appellants contend that the trial court erred in denying their motion to compel arbitration.
A trespass-to-try-title lawsuit is generally used to clear problems in chains of title or to recover possession of land unlawfully withheld from a rightful owner. Martin v. Amerman, 133 S.W.3d 262, 265 (Tex. 2004). When title to real property is at issue in a suit, trespass-to-try-title is the exclusive remedy. See TEX. PROP. CODE ANN. § 22.001(a) (Vernon 2014) (trespass to try title action determines title to real property). The prevailing party's remedy is title to, and possession of, the real property interest at issue. Vernon v. Perrien, 390 S.W.3d 47, 54 (Tex. App.—El Paso 2012, pet. denied).
See TEX. CIV. PRAC. & REM. CODE ANN. § 171.098(a) (Vernon 2011); Action Box Co. v. Panel Prints, Inc., 130 S.W.3d 249, 251 (Tex. App.—Houston [14th Dist.] 2004, no pet.) (section 171.098(a) authorizes appeal from "any final judgment entered under chapter 171 and any order, even if interlocutory, of the five enumerated types").
We affirm.
Background
In their second amended petition, appellants alleged that they and Price were the fee simple owners and tenants in common of real property described as Lot 19, Block 5, Forest Home Addition, in Houston (the "property"). Price asked appellants to sign a "two-page document," which she represented would authorize her to pay the property taxes. After each appellant signed the document, Price "added pages" to "convert it to a general warranty deed conveying the property to herself." She also added the acknowledgement of a notary public, Dottie R. Smith, who purportedly witnessed each appellant signing the document. Appellants asserted that they did not sign the document in Smith's presence, and Price subsequently conveyed the property by general warranty deed to Hale.
Smith is not a party to this appeal.
Appellants further alleged that "[b]oth deeds are void and/or voidable" as Price procured the initial deed from them by fraud. Further, Price's recording of the deed constituted a cloud on their title to the property, and her failure or refusal to remove the cloud was willful and without justification or excuse. Appellants sought an order declaring both deeds "void," removing the cloud on their title, and awarding them actual and exemplary damages and attorney's fees.
Price answered, generally denying the allegations. Hale also answered, generally denying the allegations, while also specifically denying that appellants were entitled to attorney's fees. Hale further asserted, as an affirmative defense, that he was a bona fide purchaser. He also brought a counterclaim against appellants and a cross-claim against Price for breach of warranty of title.
On January 5, 2016, the parties, after attending mediation, entered into a settlement agreement, which they filed in the trial court. Pursuant to the settlement agreement, the parties agreed to certain exchanges and distributions related to the parties' lawsuit in Harris County Probate Court No. 2, to certain exchanges pertaining to the instant trespass-to-try-title action, and that any dispute over the terms of the agreement would be subject to binding arbitration, as follows:
See TEX. R. CIV. P. 11 ("Unless otherwise provided in these rules, no agreement between attorneys or parties touching any suit pending will be enforced unless it be in writing, signed and filed with the papers as part of the record, or unless it be made in open court and entered of record."). "A settlement agreement must comply with Rule 11 to be enforceable." Padilla v. LaFrance, 907 S.W.2d 454, 460 (Tex. 1995). The parties refer to their agreement interchangeably as the "settlement agreement," the "Rule 11 agreement," and the "Rule 11 settlement agreement."
The facts pertaining to the parties' lawsuit in the probate court are not developed in the record in this appeal.
1. The parties agree to file a motion to abate the litigation pending the resolution of the Estate of Willie Lee Barnes [the "Estate"], currently pending as Cause 417417 in Probate Court No. 2, Harris County, Texas.
2. [Price] shall gift her interest in the real and personal property in the Estate of Willie Lee Barnes to [appellants].
3. In exchange for the consideration given by [Price] in the preceding paragraph, [appellants] agree that [Price] shall receive cash from the Estate . . . .
4. [Terrell], as executor of the Estate, shall distribute the remaining cash in the Estate to all beneficiaries in equal portions. . . .
5. WFG National Title Insurance Company, as insurer for [Hale], shall pay to attorney [for Price] $2,500.00 . . . in full and final settlement of all claims.
6. Upon distribution of the cash proceeds the parties shall dismiss the pending lawsuit with prejudice.
7. The parties agree to cooperate to prepare and execute all necessary documents to effect the terms of this agreement.
8. The parties agree that any dispute over the terms of this agreement shall be subject to binding arbitration with Judge Eric Andell.
9. The parties agree to do all things necessary to ensure that clear title to the property [that is] the subject of this suit is fully vested in [Hale].
. . . .
11. The parties agree to use good faith and best efforts to complete all actions agreed to within this agreement by January 31, 2016.(Emphasis added.)
In April 2016, Price moved in the trial court for a judgment enforcing the settlement agreement, asserting that she and Hale had performed, and appellants had failed to perform, their respective obligations under the agreement. On April 22, 2016, appellants, in their first amended response to the motion, argued that because Price had asserted that they "ha[d] failed to perform under the Rule 11 Agreement," there existed a "genuine dispute between the parties." Thus, pursuant to the term of the settlement agreement, which provides that "any dispute over the terms of this agreement shall be subject to binding arbitration," the parties' "dispute" must be submitted to binding arbitration, and not to a trial court for enforcement. Appellants asserted that the trial court "[did] not have the power to enforce this particular Rule 11 Agreement"; rather, it could "only confirm the award and/or decision of the arbitrator."
On April 25, 2016, after a hearing at which appellants did not appear, the trial court signed a "Partial Judgment" on the motion for enforcement of the settlement agreement, finding that:
1. A Rule 11 Agreement (the Agreement) was executed between [appellants], [Price], and [Hale] on January 5th, 2016.
2. This Agreement was the result of a mediation attended by the all parties except [Smith].
3. The Agreement was filed in the case docket on January 5th, 2016.The trial court ordered that:
4. The Agreement was intended to constitute an agreed final judgment of this matter with regards to the parties named in the Agreement but not with regards to [Smith].
5. Before the date of this hearing, [Price] executed and delivered to [appellants] a deed conveying her entire interest in the real property within the Estate. . . .
6. Before the date of this hearing [Hale] caused to be delivered to [Price] a payment from WFG National Title Insurance Company, as insurer for [Hale], in the sum of $2,500,00.
7. By the date of this hearing, [appellants] have not performed their obligations under the Rule 11 Agreement.
8. By the date of this hearing, no party or attorney has withdrawn consent to the Rule 11 Agreement.
1. [Price] grant and convey her entire interest, other than to the conveyance [to Hale], in any real and personal property in the [Estate] to [appellants][.]
2. [A]s executor of the [Estate] . . . , [Terrell] distribute the remaining cash in the Estate to all beneficiaries in equal portions.
3. [A]s consideration for [Price's] conveyance of her interest in the [Estate], Terrell . . . distribute the amount of ten-thousand dollars . . . from the [Estate] to [Price] . . . .
4. [Appellants] and [Price] execute all documents and perform all actions necessary to vest title to the Property . . . solely in the name of [Hale].
The trial court further ordered that its judgment constituted a final judgment between appellants and appellees. However, its judgment "did not affect the rights or claims" of appellants as to Smith. The trial court noted that although appellants had filed a motion to compel arbitration, it was not set for a hearing or submission at the time of the hearing on the motion to enforce the settlement agreement, and appellants did not appear at the enforcement hearing.
On May 9, 2016, the trial court signed an order denying appellants' motion to compel arbitration. It also granted appellants a summary judgment against Smith, making its judgment in the case final. Appellants then filed a "Notice of Limitation of Appeal," asserting that they "appeal from the order denying [their] application to compel arbitration rendered on May 9, 2016."
See TEX. CIV. PRAC. & REM. CODE ANN. § 171.098(a)(1); supra note 3.
Jurisdiction
As a threshold matter, appellees argue that this appeal is moot and must be dismissed because the parties, on June 21, 2016, after the trial court had entered its order denying appellants' motion to compel arbitration, executed a new settlement agreement.
"[C]ourts have an obligation to take into account intervening events that may render a lawsuit moot." Heckman v. Williamson Cty., 369 S.W.3d 137, 166-67 (Tex. 2012). Appellate courts lack jurisdiction to decide moot controversies and render advisory opinions. See Nat'l Collegiate Athletic Ass'n v. Jones, 1 S.W.3d 83, 86 (Tex. 1999). A justiciable controversy between the parties must exist at every stage of the legal proceedings, including the appeal, or the case is moot. Williams v. Lara, 52 S.W.3d 171, 184 (Tex. 2001). "If a controversy ceases to exist—'the issues presented are no longer "live" or the parties lack a legally cognizable interest in the outcome'—the case becomes moot." Id. (quoting Murphy v. Hunt, 455 U.S. 478, 481, 102 S. Ct. 1181, 1183 (1982)). The same is true if an appellate court's judgment cannot have any practical legal effect upon a then existing controversy. Zipp v. Wuemling, 218 S.W.3d 71, 73 (Tex. 2007) ("An appeal is moot when a court's action on the merits cannot affect the rights of the parties.").
Appellees reference a copy of a June 21, 2016 settlement agreement attached to their appellate briefs. We note, however, that there is not a June 2016 settlement agreement filed in the record in this appeal. Moreover, the settlement agreement attached to appellees' briefs does not reflect that it has been filed in the trial court. See TEX. R. CIV. P. 11; Padilla v. LaFrance, 907 S.W.2d 454, 460 (Tex. 1995). We must hear and determine a case on the record as filed; we may not consider documents attached to briefs as exhibits when, as here, they are not included in the record. See Till v. Thomas, 10 S.W.3d 730, 733 (Tex. App.—Houston [1st Dist.] 1999, no pet.).
We conclude that appellants' appeal of the trial court's order denying arbitration is not moot. Accordingly, we hold that we have jurisdiction to consider the appeal.
Standard of Review
We review a trial court's ruling on a motion to compel arbitration for an abuse of discretion, deferring to the trial court's factual determinations if they are supported by the evidence and reviewing legal questions de novo. In re Labatt Food Serv., L.P., 279 S.W.3d 640, 643 (Tex. 2009); Valerus Compression Servs., LP v. Austin, 417 S.W.3d 202, 207 (Tex. App.—Houston [1st Dist.] 2013, no pet.). Whether a valid arbitration agreement exists and whether the scope of the agreement encompasses the claims in dispute are questions of law that we review de novo. J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 227 (Tex. 2003); McReynolds v. Elston, 222 S.W.3d 731, 740 (Tex. App.—Houston [14th Dist.] 2007, no pet.).
A party seeking to compel arbitration must establish that (1) a valid arbitration agreement exists and (2) the claims at issue are within the scope of the agreement. In re D. Wilson Constr. Co., 196 S.W.3d 774, 780-81 (Tex. 2006); Osornia v. AmeriMex Motor & Controls, Inc., 367 S.W.3d 707, 711 (Tex. App.— Houston [14th Dist.] 2012, no pet.); see also TEX. CIV. PRAC. & REM. CODE ANN. §§ 171.001, 171.021 (Vernon 2011). In determining whether an agreement to arbitrate exists for purposes of deciding a motion to compel arbitration, we apply "traditional contract principles." Webster, 128 S.W.3d at 227. Thus, a party attempting to enforce an arbitration agreement must show the agreement meets "all requisite contract elements." Id. at 228.
The settlement agreement is silent as to whether its arbitration clause is governed by the Federal Arbitration Act ("FAA") or the Texas General Arbitration Act ("TAA"). Appellants assert that the TAA applies, and appellees do not contest this assertion. Neither party asserts that the FAA applies or preempts any aspect of the TAA relevant to this case. Thus, we do not address whether the FAA applies, and we treat this case as one governed by the TAA. See Bates v. MTH Homes-Tex., L.P., 177 S.W.3d 419, 421 (Tex. App.—Houston [1st Dist.] 2005, no pet.). Moreover, because the substantive principles applicable to the analysis in this appeal are the same under both the FAA and the TAA, we cite cases under each, without distinguishing between them. See Forest Oil Corp. v. McAllen, 268 S.W.3d 51, 56, n.10 (Tex. 2008); Osornia v. AmeriMex Motor & Controls, Inc., 367 S.W.3d 707, 711 (Tex. App.—Houston [14th Dist.] 2012, no pet.).
In determining whether a claim falls within the scope of an arbitration clause, we "focus on the factual allegations of the complaint, rather than the legal causes of action asserted." In re Rubiola, 334 S.W.3d 220, 225 (Tex. 2011) (quoting Prudential Sec. Inc. v. Marshall, 909 S.W.2d 896, 900 (Tex. 1995)); FD Frontier Drilling (Cyprus), Ltd. v. Didmon, 438 S.W.3d 688, 695 (Tex. App.—Houston [1st Dist.] 2014, pet. denied). "[A] court should not deny arbitration unless it can be said with positive assurance that an arbitration clause is not susceptible of an interpretation which would cover the dispute at issue." In re D. Wilson Constr. Co., 196 S.W.3d at 783 (quoting Marshall, 909 S.W.2d at 899); Williams Indus., Inc. v. Earth Dev. Sys. Corp., 110 S.W.3d 131, 137 (Tex. App.—Houston [1st Dist.] 2003, no pet.). "[C]ourts should resolve any doubts as to the agreement's scope, waiver, and other issues unrelated to its validity in favor of arbitration." Ellis v. Schlimmer, 337 S.W.3d 860, 862 (Tex. 2011).
If a movant shows both that a valid arbitration agreement exists and that the claims at issue fall within its scope, the burden shifts to the party opposing arbitration to present a valid defense to the agreement. J.M. Davidson, Inc., 128 S.W.3d at 227; Osornia, 367 S.W.3d at 711. If the opponent fails to prove a defense, the trial court "has no discretion but to compel arbitration and stay its own proceedings." In re FirstMerit Bank, N.A., 52 S.W.3d 749, 753-54 (Tex. 2001).
Arbitration
In their sole issue, appellants argue that the trial court erred in denying their motion to compel arbitration because the settlement agreement "contains a binding arbitration clause" that pertains to "any dispute" between the parties and "[a] dispute arose among the parties." They further argue that because the trial court had "a ministerial duty to compel the parties to binding arbitration," it lacked jurisdiction to render a judgment enforcing the settlement agreement.
Appellees argue that the trial court did not err in denying appellants' motion to compel arbitration because appellants have not identified any dispute regarding the terms of the settlement agreement. Appellees assert that no dispute exists.
It is undisputed that the parties executed a settlement agreement containing an arbitration provision, and no party has challenged the validity of that agreement or the arbitration clause. Thus, a valid arbitration agreement exists. See In re D. Wilson Constr. Co., 196 S.W.3d at 780-81.
Appellants were then required to establish that there exists a dispute within the scope of the arbitration clause. See id.; Osornia, 367 S.W.3d at 711. The clause at issue provides as follows: "The parties agree that any dispute over the terms of this agreement shall be subject to binding arbitration with Judge Eric Andell."
Generally, when an arbitration provision uses the language "any dispute," it is considered to be broad and capable of expansive reach. Didmon, 438 S.W.3d at 695. We note that the presumption of arbitrability is "particularly applicable where the clause is broad; that is, it provides for arbitration of any dispute arising between the parties, or any controversy or claim arising out of or relating to the contract thereof, or any controversy concerning the interpretation, performance or application of the contract." Babcock & Wilcox Co. v. PMAC, Ltd., 863 S.W.2d 225, 230 (Tex. App.—Houston [14th Dist.] 1993, writ denied) (internal quotations omitted).
Here, however, appellants, in their brief, do not identify any particular dispute over a term of the settlement agreement. Rather, they simply assert that "[a] dispute arose among the parties as to the recitations contained in and implementation concerning the settlement agreement."
An appellant's brief must contain a clear and concise argument for the contentions made, with appropriate citations to authorities and to the record. TEX. R. APP. P. 38.1(i). "This requirement is not satisfied by conclusory statements." Marin Real Estate Partners, L.P. v. Vogt, 373 S.W.3d 57, 75 (Tex. App.—San Antonio 2011, no pet.). A failure to provide substantive analysis of an issue waives the complaint. Id.; Huey v. Huey, 200 S.W.3d 851, 854 (Tex. App.—Dallas 2006, no pet.); Cervantes-Peterson v. Tex. Dep't of Family & Protective Servs., 221 S.W.3d 244, 255 (Tex. App.—Houston [1st Dist.] 2006, no pet.).
In determining whether a claim falls within the scope of an arbitration clause, we are required to "focus on the factual allegations." See In re Rubiola, 334 S.W.3d at 225; Didmon, 438 S.W.3d at 695. Appellants' bare assertion that "a dispute arose among the parties as to the recitations contained in and implementation concerning the settlement agreement" is conclusory because it does not provide any underlying facts. See Dolcefino v. Randolph, 19 S.W.3d 906, 930 (Tex. App.—Houston [14th Dist.] 2000, pet. denied) ("A conclusory statement is one that does not provide the underlying facts to support the conclusion. . . ."). Without an analysis of the facts, we cannot discern whether there exists a dispute within the scope of the arbitration clause, i.e., a dispute "over the terms" of the settlement agreement, particularly one related to the trespass-to-try-title lawsuit before us and not to the parties' lawsuit in the probate court. See Tesoro Petroleum Corp. v. Nabors Drilling USA, Inc., 106 S.W.3d 118, 128 (Tex. App.—Houston [1st Dist.] 2002, pet. denied) ("Rule 38 requires [appellant] to provide us with such discussion of the facts and the authorities relied upon . . . to maintain the point at issue. This is not done by merely uttering brief conclusory statements, unsupported by legal citations." (internal citations omitted)); see also Vogt, 373 S.W.3d at 75 (briefing requirements not satisfied by conclusory statements).
Further, the record does not show that appellants, either in their motion to compel arbitration or in their motion for reconsideration in the trial court, identified any specific dispute "over the terms" of the settlement agreement. Although appellants, in their first amended response to the motion for enforcement of the settlement agreement, argued that there existed a "genuine dispute between the parties" because Price asserted that appellants "ha[d] failed to perform under the Rule 11 Agreement," they do not direct us to any authority supporting their assertion that simply failing to perform as agreed, without more, constitutes a dispute "over the terms" of the agreement.
We conclude that appellants, in their brief, have not provided us with a clear and concise argument, with appropriate citations to the record or authority in support. See TEX. R. APP. P. 38.1(i). Accordingly, we hold that appellants have waived their sole issue.
Frivolous Appeal
In a cross-point, Hale contends that appellants' appeal is frivolous, and he requests that this Court award him his appellate attorney's fees. See TEX. R. APP. P. 45 (damages for frivolous appeals in civil cases).
We may award just damages to a prevailing party if we objectively determine, after considering "the record, briefs, or other papers filed in the court of appeals," that an appeal is frivolous. Id.; Smith v. Brown, 51 S.W.3d 376, 380-81 (Tex. App.—Houston [1st Dist.] 2001, pet. denied). An appeal is frivolous when the record, viewed from the perspective of the advocate, does not provide reasonable grounds for the advocate to believe that the case could be reversed. Smith, 51 S.W.3d at 381. The decision to grant appellate sanctions is a matter of discretion that an appellate court exercises with prudence and caution and only after careful deliberation. Id. And rule 45 does not require the Court to award just damages in every case in which an appeal is frivolous. Glassman v. Goodfriend, 347 S.W.3d 772, 782 (Tex. App.—Houston [14th Dist.] 2011, pet. denied). After a review of the record, briefing, and other papers filed in this Court, we deny Hale's request for damages. See TEX. R. CIV. P. 45; Smith, 51 S.W.3d at 381.
Conclusion
We affirm the judgment of the trial court.
Terry Jennings
Justice Panel consists of Chief Justice Radack and Justices Jennings and Lloyd.