Opinion
No. 05-15-00758-CV
04-28-2016
JARI'L ROBINSON AND RAMONIA ROBINSON, Appellants v. PACE HOMES, INC., Appellee
On Appeal from the 95th Judicial District Court Dallas County, Texas
Trial Court Cause No. DC-13-13967-D
MEMORANDUM OPINION
Before Justices Lang-Miers, Brown, and Schenck
Opinion by Justice Lang-Miers
Appellants Jari'l and Ramonia Robinson contracted with Pace Homes, Inc. to construct a home. Pace sued the Robinsons for failure to make all of the payments due under the contract. The Robinsons answered and moved to dismiss the lawsuit alleging that the contract contained a clause requiring the parties to mediate before filing a lawsuit and, if mediation was unsuccessful, to submit to binding arbitration. Pace filed a motion to determine the validity of the arbitration clause and, alternatively, to compel arbitration. After a hearing, the court denied the Robinsons' motion and set the case for trial on the court's non-jury docket. The Robinsons appeal. We reverse the trial court's order and remand to that court for an order compelling arbitration. Because the law to be applied in this case is settled, we issue this memorandum opinion. See TEX. R. APP. P. 47.4.
BACKGROUND
In response to Pace's lawsuit, the Robinsons filed one document containing a "Motion to Dismiss" and a "General Denial Subject to Motion to Dismiss." In the motion to dismiss, the Robinsons stated that Pace's claims were "subject to Alternative Dispute Resolution as provided by the alleged contract of the Parties paragraph 16L of Plaintiff's Exhibit A." They argued that the lawsuit was not ripe and moved for dismissal. In the answer portion of the document, the Robinsons alleged affirmative defenses which included that Pace had filed the lawsuit without first complying with the mediation and arbitration clauses in the contract and asked for attorney's fees.
In response to the Robinsons' pleading, Pace filed a motion in which it admitted that the contract contained an arbitration clause, but alleged that the following language concerning payment of the initial costs of arbitration was unconscionable because Pace could not afford to pay all the upfront costs of arbitration:
In no event shall [Home]Owner be initially required to pay arbitration costs and fees in excess of those that would have been incurred in filing suit in a court of law and effecting service of process.It was undisputed that Pace provided the contract to the Robinsons and the contract was a form contract provided by the Texas Association of Builders.
At the hearing on Pace's motion, the trial court asked Pace, "So what specifically are you asking me to do?" Pace responded, "I am asking the Court, number one, to allow this case to proceed under arbitration. I am asking the Court to appoint an arbitrator because we're not going to be able to agree, and I am asking the Court to determine in terms of initial upfront costs how those costs are to be paid." Pace asked the court to require the initial costs to be "divided fifty-fifty."
In response, the Robinsons argued that the arbitrator should decide which party pays the costs. They pointed out that the arbitration clause allows the arbitrator to award "all or any portion of its costs and fees" to the prevailing party, but "in order to keep this thing from being outrageously expensive to the homeowner, the homeowner is only required to pay the cost as specified in the contract" upfront. The Robinsons also argued that determining the division of costs and fees in advance would require the court "to try the case to see how the equities align, which essentially guts the entire arbitration proceeding and removes that from the contract."
At the conclusion of the hearing on Pace's motion, the court asked the Robinsons about their motion to dismiss. The Robinsons told the court that their motion was "[t]he same thing" the court had just heard. The court said, "That's what I was thinking." Then the court said it would take the matter under advisement. The court later denied the Robinsons' motion to dismiss and said the case would be set for trial. The court did not rule on Pace's motion. A month later, the court issued a notice of non-jury trial setting.
The Robinsons appeal the trial court's order denying their motion to dismiss. They argue that their motion to dismiss, while inartfully drafted, and their arguments at the hearing show the gist of the motion was to compel arbitration, and the trial court's order denying the motion to dismiss was a denial of their attempt to compel arbitration. They also argue that Pace did not establish that the provision in the arbitration clause regarding who pays the initial costs of arbitration was unconscionable. Pace, on the other hand, argues that the trial court did not commit reversible error by denying the motion to dismiss because it "was premature" as it sought dismissal of the entire case. Pace also contends that a ruling on its motion is still outstanding and that we should remand to the trial court for a ruling. We agree with the Robinsons.
The gist of the Robinsons' motion to dismiss and answer was to seek arbitration. In their motion and at the hearing the Robinsons insisted on their right to arbitrate pursuant to the arbitration clause in the contract. And at the conclusion of the hearing, the Robinsons advised the trial court that their motion to dismiss was the "same thing" as Pace's motion to compel. Consequently, we conclude that the issue before the trial court was whether to compel arbitration and the order denying the Robinsons' motion to dismiss was an order denying arbitration.
Ordinarily the issues on appeal concerning arbitration are whether there is an agreement to arbitrate and the dispute falls within the scope of the agreement. See, e.g., In re FirstMerit Bank, N.A., 52 S.W.3d 749, 753-54 (Tex. 2001). But those are not issues in this appeal because the parties agreed at the hearing that the contract required arbitration and both parties asked the court to send the case to arbitration. When there is no dispute about whether the contract contains an agreement to arbitrate and the claim falls within the scope of the agreement, a trial court has no discretion but to stay its own proceedings and compel arbitration. Id. And Pace's contention that a portion of the arbitration clause was unconscionable is not before us because Pace did not get a ruling on that issue. See TEX. R. APP. P. 33.1(a). Consequently, we resolve the Robinsons' sole issue in their favor.
CONCLUSION
We conclude that the trial court abused its discretion by refusing to compel arbitration. We reverse the trial court's May 17, 2015 order denying the Robinsons' motion to dismiss and remand to the trial court to compel arbitration.
/Elizabeth Lang-Miers/
ELIZABETH LANG-MIERS
JUSTICE 150758F.P05
JUDGMENT
On Appeal from the 95th Judicial District Court, Dallas County, Texas
Trial Court Cause No. DC-13-13967-D.
Opinion delivered by Justice Lang-Miers. Justices Brown and Schenck participating.
In accordance with this Court's opinion of this date, the May 17, 2015 order of the trial court denying Appellants' motion to dismiss is REVERSED and this cause is REMANDED to the trial court to compel arbitration.
It is ORDERED that appellants Jari'l Robinson and Ramonia Robinson recover their costs of this appeal from appellee Pace Homes, Inc. Judgment entered this 28th day of April, 2016.