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In re in the Estate of Guerrero

Court of Appeals of Texas, Houston (14th Dist.).
Apr 23, 2015
465 S.W.3d 693 (Tex. App. 2015)

Summary

holding that there was "no competent evidence" of an agreement to arbitrate because the party had completely failed to authenticate the documents attached to its motions to compel arbitration

Summary of this case from Allen v. Jungenberg

Opinion

NO. 14–13–00580–CV

2015-04-23

In the Estate of Rosa Elvia Guerrero, Deceased

Daniel J. Kasprzak, Houston, TX, for Appellant. Thomas M. Bullion III, Austin, TX, for Appellee.



On Appeal from the Probate Court No. 2, Harris County, Texas, Trial Court Cause No. 388,367–401
Daniel J. Kasprzak, Houston, TX, for Appellant. Thomas M. Bullion III, Austin, TX, for Appellee.

EN BANC MAJORITY OPINION


Ken Wise, Justice

Mike Hall Chevrolet, Inc. d/b/a Champion Chevrolet (Champion) brings this interlocutory appeal from the trial court's order denying its motion to compel arbitration pursuant to the Federal Arbitration Act (FAA). SeeTex. Civ. Prac. & Rem. Code § 51.016 (providing that matters subject to the FAA may be appealed under the same circumstances that an appeal from a federal court order is permitted by 9 U.S.C. § 16). In a single broad issue, Champion asserts the trial court erred in denying arbitration because there is a valid arbitration agreement and the claims asserted in the underlying suit are within its scope.

We grant Champion's motion for en banc reconsideration, withdraw the majority and dissenting opinions issued September 4, 2014, and issue en banc majority and dissenting opinions in their stead.

I. FACTUAL AND PROCEDURAL BACKGROUND

On August 13, 2007, Champion sold a used 2003 Chevrolet Trailblazer to Rosa Elvia Guerrero. Champion alleges that in connection with the purchase, Guerrero executed a Buyer's Order and Invoice, Retail Installment Contract, Security Agreement, and Arbitration Agreement. The Arbitration Agreement provides in relevant part:

This Arbitration Agreement (“Agreement”) applies to Customer(s) (“you”) who is/are in the process of: (1) purchasing or leasing a vehicle(s) including any negotiations or application(s) for credit or other dealings or interactions with the Dealership (hereinafter including its employees, agents, successors, assigns, subsidiaries, parents and affiliates); (2) servicing any vehicle(s) with the Dealership; or (3) reviewing, negotiating or executing any documents or agreements during the course of interactions with the Dealership (collectively, “Customer(s)/Dealership Dealings”). You and the Dealership agree that arbitration will be the sole method of resolvingany claim, dispute, or controversy (collectively, “Claims”) that either Party has arising from Customer(s)/Dealership Dealings. Such Claims include, but are not limited to, the following: (1) Claims in contract, tort, regulatory, statutory, equitable, or otherwise; (2) Claims relating to any representations, promises, undertakings, warranties, covenants or service; (3) Claims regarding the interpretation, scope, or validity of this Agreement, or arbitrability of any issue; (4) Claims between you and Dealership; and (5) Claims arising out of or relating to your application for credit, this Agreement and/or any and all documents executed, presented or negotiated during Customer(s)/Dealership Dealings, or any resulting transaction, service, or relationship, including that with the Dealership, or any relationship with third parties who do not sign this Agreement that arises out of the Customer(s)/Dealership Dealings.

The Retail Installment Sales Contract contains no arbitration clause, but it has a merger clause stating: “This contract contains the entire agreement between you and us relating to the sale and financing of the vehicle.” Similarly, the Security Agreement does not contain an arbitration clause, but it also has a merger clause, which states:

Entire Agreement. This Security Agreement embodies the entire agreement and understanding of Secured Party relating to the subject matter hereof and supersedes all prior representations, agreements and understandings, oral or written, relating to such subject matter.

The Buyer's Order addresses arbitration:

Any controversy or claim arising out of or relating to this purchase agreement or the breach thereof shall be settled by binding arbitration in accordance with the commercial arbitration rules of the American arbitration association [ sic ]. Any controversy or claim subject to this arbitration provision shall be decided by one arbitrator, and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Any arbitration proceeding shall be conducted in the city and state where the vehicle purchased [ sic ] hereunder from the company.

It is alleged that Champion installed used tires on the vehicle as part of a “wheel swap.” It is also alleged that Champion serviced the vehicle on several occasions after Guerrero's purchase. Guerrero and her minor son, Ruben Dominguez, died in an accident on March 23, 2009, which was allegedly caused by a failed tire on the vehicle. Guerrero's daughter, Ariana Dominguez, and two other passengers in Guerrero's vehicle, a friend and a niece, survived but were injured. Guerrero's vehicle crossed into oncoming traffic and collided with other vehicles, killing one of the drivers.

The underlying case began as the administration of Guerrero's estate. Another daughter, Alexandra Deike, was appointed to serve as Administratrix of her mother's estate. Ariana Dominguez was appointed to serve as Administratrix the estate of her brother, Ruben. On January 31, 2011, Alexandra Deike, individually and on behalf of the estate of her mother, Ariana Dominguez, individually and on behalf of the estate of her brother, and Gregorio Dominguez, Ruben's father, (collectively the Guerrero parties) filed wrongful death, survival, personal injury, and product liability claims in the probate action against Michelin North America, Inc., the tire manufacturer, and a tire service company, who is no longer a party. Guerrero's parents (the parents) intervened, adding wrongful death claims against the tire companies. The surviving passengers in Guerrero's car (the passengers) also intervened to allege personal injury claims against the tire companies. The original defendants designated Champion as a responsible third party, and in April 2012, the Guerrero parties, the parents, and the passengers added Champion as a defendant, alleging wrongful death, survival and personal injury claims. The parents and passengers later added negligence claims against the Guerrero estate. In addition, Champion's affiliated companies (the AutoNation defendants) were later named as defendants. The estate and family members of the other driver (the Clarks) also intervened in the suit, alleging products liability, breach of warranty, negligence, and gross negligence against Michelin and Goodrich Corporation f/k/a the B.F. Goodrich Company, and negligence against Champion, the AutoNation defendants, and the Guerrero estate.

Champion filed its Motion to Compel Arbitration and for Stay or Dismissal of Litigation on May 16, 2012. It originally sought to compel arbitration with only the Guerrero parties; no other parties were included in Champion's motion. After a hearing on June 26, 2012, the trial court ordered the parties to engage in discovery on the arbitration issue.

On February 5, 2013, Champion filed a Plea to the Jurisdiction and Amended Motion to Compel Arbitration. The amended motion expressly sought to compel arbitration of only the survival actions regarding Rosa Guerrero and Ruben Dominguez. In the jurisdictional plea, Champion sought dismissal of the personal injury and wrongful death claims, asserting the probate court lacked jurisdiction. The Guerrero parties responded in opposition. The trial court conducted a hearing on Champion's motion on February 28, 2013. The court denied the plea to the jurisdiction, but it advised the parties it would defer its ruling on the amended motion to compel arbitration until March 8, 2013, pending receipt of additional briefing. On March 6, 2013, Champion filed a Supplement to its Amended Motion to Compel Arbitration to add “all claims which are asserted by, or derivative of, Rosa Guerrero, Ruben Dominguez, Ariana Dominguez, as requested in the Original Motion” to compel arbitration. The Guerrero parties, the parents, and the passengers responded. After a hearing on June 25, 2013, the trial court signed an order denying the motion to compel arbitration without stating a basis for the ruling. Champion filed a timely notice of interlocutory appeal.

The notice of appeal was filed by Mike Hall Chevrolet, Inc. d/b/a Champion Chevrolet. In its brief, Champion asserts that Mike Hall Chevrolet, Inc. changed its assumed name from Champion Chevrolet Highway 6 to AutoNation Chevrolet Highway 6 during the pendency of the underlying suit. We refer to appellant as Champion in this opinion.

II. GOVERNING LAW AND STANDARD OF REVIEW

Arbitration cannot be ordered in the absence of an agreement to arbitrate. See Freis v. Canales, 877 S.W.2d 283, 284 (Tex.1994). Thus, despite strong presumptions that favor arbitration, a valid agreement to arbitrate is a settled, threshold requirement to compel arbitration. See In re Kellogg Brown & Root, Inc., 166 S.W.3d 732, 737–38 (Tex.2005) (orig.proceeding). The party moving to compel arbitration has the initial burden of proof to establish the arbitration agreement's existence and to show that the claims asserted against it fall within the arbitration agreement's scope. Rachal v. Reitz, 403 S.W.3d 840, 843 (Tex.2013); see also J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 233 (Tex.2003).

Federal law provides that arbitration agreements are governed by contract law and are subject to contract defenses. See In re Poly–Am., L.P., 262 S.W.3d 337, 347 (Tex.2008) (citing 9 U.S.C. § 2). Under the FAA, an agreement to arbitrate is valid if it meets the requirements of the general contract law of the applicable state. In re AdvancePCS Health L.P., 172 S.W.3d 603, 606 (Tex.2005) (orig.proceeding) (citing First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995)). The United States Supreme Court has emphasized that the FAA's purpose is to make arbitration agreements “as enforceable as other contracts, but not more so.” In re Merrill Lynch Trust Co. FSB, 235 S.W.3d 185, 192 (Tex.2007) (quoting Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 404 n. 12, 87 S.Ct. 1801, 18 L.Ed.2d 1270 (1967)).

Under Texas law, the trial court conducts a summary proceeding to determine the applicability of an arbitration clause. In re Weekley Homes, L.P., 180 S.W.3d 127, 130 (Tex.2005); Tex. Civ. Prac. & Rem. Code § 171.021 (b) (“If a party opposing an application [for arbitration] denies the existence of the agreement, the court shall summarily determine that issue.”). The trial court makes this summary determination based on the parties' affidavits, pleadings, discovery, and stipulations. Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 269 (Tex.1992) (orig.proceeding). This procedure is similar to a motion for partial summary judgment and is subject to the same evidentiary standards. See In re Jebbia, 26 S.W.3d 753, 756–57 (Tex.App.–Houston [14th Dist.] 2000, orig. proceeding). Thus, the party alleging an arbitration agreement must present summary proof that an agreement to arbitrate requires arbitration of the dispute. Tipps, 842 S.W.2d at 269. The party resisting may then contest the opponent's proof or present evidence supporting the elements of a defense to enforcement. Jebbia, 26 S.W.3d at 757. If there is a genuine question of material fact concerning the existence of the agreement, the trial court may not summarily grant or deny the motion to compel arbitration but must conduct an evidentiary hearing to resolve the disputed material facts. Id. at 759 (trial court abused its discretion by granting a motion to compel arbitration when there were issues of material fact on whether the agreement was enforceable).

Whether an arbitration agreement is enforceable is a question of law which is reviewed do novo. J.M. Davidson, Inc., 128 S.W.3d at 227. In addition, whether an arbitration agreement binds a nonsignatory is a gateway matter to be determined by the court, rather than the arbitrator See In re Weekley Homes, 180 S.W.3d at 130 ; see also In re Labatt Food Service, L.P., 279 S.W.3d 640, 643 (Tex.2009) (orig.proceeding) (stating that when the “arbitration agreement is silent about who is to determine whether particular persons are bound by the agreement, courts, rather than the arbitrator, should determine the issue”).

When reviewing the denial of a motion to compel arbitration, if the court's factual findings are in dispute, we review the court's ruling under a legal sufficiency or “no evidence” standard of review. Id. In conducting a legal sufficiency review, we credit favorable evidence if a reasonable fact finder could do so and disregard contrary evidence unless a reasonable fact finder could not do so. City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex.2005). We defer to the trial court's factual determinations that are supported by evidence, but we review the trial court's legal determinations de novo. In re Labatt Food Serv., 279 S.W.3d at 643.

The record must be construed in a light favorable to supporting the trial court's ruling. See J.M. Davidson, Inc., 128 S.W.3d at 233. When a party does not request findings of fact or conclusions of law and the trial court files none, it is implied that the trial court made all necessary findings of fact to support its ruling. See Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 83 (Tex.1992). The trial court did not state a basis for its ruling in the order denying the motion to compel arbitration. Accordingly, we must uphold the trial court's ruling on any legal theory supported by the evidence. See Worford v. Stamper, 801 S.W.2d 108, 109 (Tex.1990); Inland Sea, Inc. v. Castro, 420 S.W.3d 55, 57–59 (Tex.App.–El Paso 2012, pet. denied) (affirming denial of motion to compel arbitration on alternative ground where order did not specify the basis for the ruling); Grand Homes 96, L.P. v. Loudermilk, 208 S.W.3d 696, 702 (Tex.App.–Fort Worth 2006, pet. denied) (stating appellate court is required to uphold the trial court's ruling on a motion to compel arbitration if it is proper on any grounds).

III. DISCUSSION

A. Champion's Issues

Although Champion raises a single broad issue asserting the trial court erred in denying arbitration, it includes several sub-issues. Champion first argues the trial court erred by denying its motion to compel arbitration because Guerrero and Champion agreed to submit disputes such as the underlying action to arbitration. Champion argues courts must resolve any doubts about an agreement to arbitrate in favor of arbitration, citing Cantella & Co. v. Goodwin, 924 S.W.2d 943, 944 (Tex.1996) (orig.proceeding) (granting mandamus relief where trial court had denied a motion to compel arbitration after the relator had proved up the arbitration agreement and that the subject matter involved commerce, thereby bringing the agreement within the FAA's scope). The presumptions favoring arbitration do not apply to a court's determination as to whether an arbitration agreement exists, however. See In re Kellogg, Brown & Root, Inc., 166 S.W.3d at 737–38.

Generally, an arbitration agreement is enforced only between signatories to the agreement. Van Zanten v. Energy Transfer Ptnrs., L.P., 320 S.W.3d 845, 847 (Tex.App.–Houston [1st Dist.] 2010, no pet.). Champion alleges, however, that the claims of the Guerrero parties, the passengers, and the parents are within the scope of the Arbitration Agreement because the wrongful death and survival claims are derivative of Guerrero's rights. See In re Jindal Saw Ltd., 289 S.W.3d 827, 828 (Tex.2009) (holding a decedent's pre-death arbitration agreement binds her wrongful death beneficiaries); Labatt, 279 S.W.3d at 646 (stating that a wrongful death cause of action is entirely derivative and regardless of the fact that the beneficiaries are seeking compensation for their own personal loss, they still stand in the decedent's legal shoes and are bound by her agreement); Russell v. Ingersoll–Rand Co., 841 S.W.2d 343, 345 (Tex.1992) (stating survival claims are wholly derivative of a decedent's rights).

Champion also argues the individual claims of the Guerrero parties, the parents, and the passengers are within the scope of the agreement because they seek to derive a benefit from the sales contract by alleging claims related to the sale and service of the vehicle. See In re Kellogg Brown & Root, Inc., 166 S.W.3d at 739 (holding a non-signatory plaintiff may be compelled to arbitrate under direct benefits estoppel if he seeks to enforce the terms of a contract containing an arbitration provision because he is estopped from simultaneously attempting to avoid the contract's burdens, including the obligation to arbitrate disputes). Champion acknowledges that the Clarks are not signatories to the agreement, but it contends their claims are factually intertwined with the arbitrable claims. See Ascendant Anesthesia PLLC v. Abazi, 348 S.W.3d 454, 462 (Tex.App.–Dallas 2011, no pet.) (recognizing that claims may become arbitrable when factually intertwined with arbitrable claims); see also In re Prudential Sec. Inc., 159 S.W.3d 279, 283 (Tex.App.–Houston [14th Dist.] 2005, orig. proceeding) (“To be within the scope of an arbitration provision, the allegations need only be factually intertwined with arbitrable claims or otherwise touch upon the subject matter of the agreement containing the arbitration provision.”). Alternatively, if these claims are not subject to arbitration, Champion asserts the arbitrable claims must be compelled to arbitration even if it results in piecemeal litigation. See Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 217, 105 S.Ct. 1238, 1241, 84 L.Ed.2d 158 (1985) (stating the FAA requires arbitrable claims to be arbitrated even if it may result in “the possibly inefficient maintenance of separate proceedings in different forums”).

We express no opinion on Champion's argument that factually intertwined claims must be compelled to arbitration in this case.

Finally, Champion asserts it has not waived its right to arbitrate this dispute. See Perry Homes v. Cull, 258 S.W.3d 580, 589–90 (Tex.2008) (holding a party waives an arbitration clause by substantially invoking the judicial process to the other party's detriment or prejudice).

B. The Responses in Opposition to Arbitration

The Guerrero parties allege: (1) the court's general order must be affirmed because Champion failed to negate every legal theory supported by the record; (2) Champion failed to offer admissible evidence to prove a valid arbitration agreement exists and that the underlying dispute is within its scope, and the trial court properly refused to give weight to the unauthenticated documents containing hearsay attached to Champion's amended motion to compel arbitration; (3) nonsignatories are not bound because the arbitration documents do not mention heirs or others with claims based on wrongful death; and (4) the merger clauses in the contracts that do not contain arbitration agreements require that the court give no effect to the arbitration agreement and the arbitration language in the Buyer's Order.

The passengers filed a response to Champion's amended motion to compel arbitration in which they assert that their claims do not fall within the scope of the arbitration clauses. They also argue that Champion waived its right to arbitration by seeking to dismiss plaintiffs' claims and substantially invoking the judicial process.

C. Did Champion establish the existence of a valid arbitration agreement?

On appeal, Champion alleges that Guerrero executed several documents as part of a single transaction when she purchased the vehicle: (1) Buyer's Order and Invoice; (2) Motor Vehicle Retail Installment Sales Contract; (3) Security Agreement; and (4) Arbitration Agreement. The general rule is that separate documents executed at the same time, for the same purpose, and in the course of the same transaction are to be considered as one instrument, and are to be read and construed together. CA Partners v. Spears, 274 S.W.3d 51, 66 n. 9 (Tex.App.–Houston [14th Dist.] 2008, pet. denied) (citing Jones v. Kelley, 614 S.W.2d 95, 98 (Tex.1981)). In addition, a court may determine, as a matter of law, that multiple documents comprise a written contract, and in appropriate instances, may construe all the documents as if they were part of a single, unified instrument. The Courage Co., L.L.C. v. The Chemshare Corp., 93 S.W.3d 323, 333 (Tex.App.–Houston [14th Dist.] 2002, no pet.) (citing Fort Worth I.S.D. v. City of Fort Worth, 22 S.W.3d 831, 840 (Tex.2000)).

1. Burden of Proof

When an entity seeks to compel arbitration, it must first establish its right to that contract remedy. See Mohamed v. Auto Nation USA Corp., 89 S.W.3d 830, 836 (Tex.App.–Houston [1st Dist.] 2002, no pet.) (granting mandamus relief where movants did not meet their initial evidentiary burden to establish an arbitration agreement they could enforce). It is well settled that the first step to prove arbitration is required is to establish the parties executed a valid agreement to arbitrate. See In re Kellogg Brown & Root, Inc., 166 S.W.3d at 737–38.

The party moving to compel arbitration has the initial burden of proof to establish the arbitration agreement's existence and to show that the claims asserted against it fell within the arbitration agreement's scope. See J.M. Davidson, Inc., 128 S.W.3d at 233. In other words, the party alleging the existence of an arbitration agreement must present summary proof that an agreement to arbitrate exists and requires arbitration of the dispute. In re Jim Walter Homes, Inc., 207 S.W.3d 888, 897 (Tex.App.–Houston [14th Dist.] 2006, orig. proceeding); In re Jebbia, 26 S.W.3d 753, 757 (Tex.App.–Houston [14th Dist.] 2000, orig. proceeding) (citing Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 269 (Tex.1992) (orig.proceeding)).

Although public policy favors arbitration, arbitration is also a creature of contract. In re Bunzl USA, Inc., 155 S.W.3d 202, 209 (Tex.App.–El Paso 2004, orig. proceeding). In deciding whether the parties have agreed to arbitrate, we do not resolve doubts or indulge a presumption in favor of arbitration. Id. (citing In re Jebbia, 26 S.W.3d at 757 ). Thus, a party seeking to compel arbitration must first establish that an agreement exists and that the claims raised are within the agreement's scope before doubts are resolved in favor of arbitration. See Cantella, 924 S.W.2d at 944.

In sum, a prerequisite to compelling arbitration is to prove the existence and execution of the arbitration agreement. See, e.g., Citigroup Global Markets, Inc. v. Brown, 261 S.W.3d 394, 400 (Tex.App.–Houston [14th Dist.] 2008, no pet.) (stating the moving parties attached to their motion to compel an affidavit proving up the agreement and stating that the non-movant entered into the agreement); In re Kellogg Brown & Root, 80 S.W.3d 611, 616 (Tex.App.–Houston [1st Dist.] 2002, orig. proceeding) (noting the movant's affidavit stated the documents were signed by the non-movant during his employment with Kellogg).

2. Evidence

The evidentiary standards for a motion to compel arbitration are the same as for a motion for summary judgment. In re Jebbia, 26 S.W.3d at 756–57. Under the summary judgment standard, copies of documents must be authenticated in order to constitute competent summary judgment evidence. See Republic Nat'l Leasing Corp. v. Schindler, 717 S.W.2d 606, 607 (Tex.1986) (per curiam); see also Niu v. Revcor Molded Prod. Co., 206 S.W.3d 723, 729 (Tex.App.–Fort Worth 2006, no pet.). A properly sworn affidavit stating that the attached documents are true and correct copies of the original authenticates the copies so they may be considered as summary judgment evidence. Republic, 717 S.W.2d at 607 ; see also Jack B. Anglin Co., 842 S.W.2d at 270 (relying on summary judgment precedent to hold that the trial and appellate courts must accept as true the clear, direct, and positive evidence of an undisputed affidavit supporting a motion to compel arbitration).

Champion attached to its original motion to compel arbitration a copy of the Arbitration Agreement that it alleges is part of the sales documents signed when Guerrero purchased the vehicle. The copy was referred to in the motion as a “true and correct” copy, but no affidavit or other type of verification was included with the motion. In their response, the Guerrero parties objected to the attachment as inadmissible. Champion later filed an amended motion to compel arbitration, attaching all four sales documents, but it did not include an affidavit or other authentication. The Guerrero parties again objected to the lack of authentication and that no proof of execution was provided. “Simply attaching a document to a pleading does not make the document admissible as evidence, dispense with proper foundational evidentiary requirements, or relieve a litigant of complying with other admissibility requirements.” Gruber v. CACV of Colorado, LLC, No. 05–07–00379–CV, 2008 WL 867459, at *2 (Tex.App.–Dallas Apr. 2, 2008, no pet.) (mem.op) (setting aside arbitration award where unauthenticated copy of award amounted to no evidence, citing Ceramic Tile Intern., Inc. v. Balusek, 137 S.W.3d 722, 725 (Tex.App.–San Antonio 2004, no pet.)).

Champion asserts that the Arbitration Agreement was properly received into evidence because the Guerrero parties failed to challenge it by a sworn pleading or affidavit, citing Rule of Civil Procedure 93(7), which provides that a written contract is received into evidence unless a party files a verified pleading denying the execution of the document. Tex. R. Civ. P. 93 (7). To support its position, Champion cites Gutierrez v. Rodriguez, 30 S.W.3d 558 (Tex.App.–Texarkana 2000, no pet.) and Boyd v. Diversified Financial Systems, 1 S.W.3d 888 (Tex.App.–Dallas 1999, no pet.). These authorities are not controlling, however. In Gutierrez, the documents at issue were admitted without objection. Gutierrez, 30 S.W.3d at 562. Rule 93(7) concerns execution of a contract, but it does not address its authentication. In Boyd, while the signatures were not required to be proved in the absence of a verified denial, the contracts where authenticated before they were admitted as evidence. Boyd, 1 S.W.3d at 891. The proponent of the note and guaranty testified through its representative that it possessed the originals of the exhibits and the proffered exhibits were true and exact copies of the originals. Id.

The trial court may summarily decide whether to compel arbitration on the basis of affidavits, pleadings, discovery, and stipulations if the material facts are not controverted. See Texas La Fiesta Auto Sales, LLC v. Belk, 349 S.W.3d 872, 882 (Tex.App.–Houston [14th Dist.] 2011, no pet.) (citing Jack B. Anglin Co., 842 S.W.2d at 269 ). When, as here, the facts are disputed, the trial court should conduct an evidentiary hearing. Jebbia, 26 S.W.3d at 759. Although records from three hearings related to Champion's motions to compel arbitration are included in our record,none of the hearings was evidentiary. Thus, Champion did not authenticate the sales documents by testimony at an evidentiary hearing. Our record does not reflect that Champion requested an evidentiary hearing and it has not complained on appeal that the trial court failed to hold one. See Smart Call, LLC v. Genio Mobile, Inc., No. 14–13–00223–CV, 2014 WL 3955083, at *7 (Tex.App.–Houston [14th Dist.] Aug. 14, 2014, pet. denied) (affirming the trial court's denial of a motion to compel arbitration where the movant did not conclusively establish the existence of an agreement, did not request an evidentiary hearing, and did not complain on appeal that the trial court failed to hold one).

Because Champion has not authenticated the Arbitration Agreement or any of the sales documents it attached to its motions to compel arbitration, there is no competent evidence of an agreement to arbitrate. See In re Universal Fin. Consulting Group, Inc., No. 14–08–00226–CV, 2008 WL 2133186, at *2 (Tex.App.–Houston [14th Dist.] 2008, May 20, 2008, orig. proceeding) (mem.op.) (holding that because the trial court could not have properly considered the unauthenticated agreements attached to motion to compel arbitration and amended motion, it did not abuse its discretion by denying the motion to compel arbitration); see also Mayo v. Suemaur Exploration & Prod. LLC, No. 14–07–00491–CV, 2008 WL 4355259, at *5 (Tex.App.–Houston [14th Dist.] Aug. 26, 2008, pet. denied) (mem.op.) (unauthenticated or unsworn documents or documents not supported by an affidavit are not entitled to consideration as summary judgment evidence).

Accordingly, we conclude the trial court did not abuse its discretion in denying the motion to compel arbitration.

3. Was there a judicial admission?

In their response in opposition to arbitration, the Guerrero parties stated, “In connection with the purchase, Rosa Guerrero apparently signed various documents.” In addition, counsel stated, “The ones that were signed in August were signed at roughly the same time, evidently. We still, of course, don't have evidence to show that. But, evidently, in looking at their dates, they seem to be signed at the same time.” Based on these statements, Champion asserts the Guererro parties' counsel judicially admitted the existence of an arbitration agreement signed by Guerrero.

A judicial admission results when a party makes a statement of fact which conclusively disproves a right of recovery or a defense. See Brown v. Lanier Worldwide, Inc., 124 S.W.3d 883, 900 (Tex.App.–Houston [14th Dist.] 2004, no pet.); Richards v. Comm'n for Lawyer Discipline, 35 S.W.3d 243, 247 (Tex.App.–Houston [14th Dist.] 2000, no pet.). A judicial admission is a formal waiver of proof that dispenses with the production of evidence on an issue and bars the admitting party from disputing it. Dowelanco v. Benitez, 4 S.W.3d 866, 871 (Tex.App.–Corpus Christi 1999, no pet.). As long as the statement stands unretracted, it must be taken as true by the court and jury; it is binding on the declarant and he cannot introduce evidence to contradict it. Smith v. Altman, 26 S.W.3d 705, 709 (Tex.App.–Waco 2000, pet. dism'd w.o.j.). This rule is based on the public policy that it would be unjust to permit a party to recover after he has sworn himself out of court by a clear, unequivocal statement. Dowelanco, 4 S.W.3d at 871. Counsel's statements on behalf of a client may serve as judicial admissions. In re M.M.O., 981 S.W.2d 72, 84 (Tex.App.–San Antonio 1998, no pet.). The elements required for a judicial admission are: (1) a statement made during the course of a judicial proceeding; (2) that is contrary to an essential fact or defense asserted by the person making the admission; (3) that is deliberate, clear, and unequivocal; (4) that, if given conclusive effect, would be consistent with public policy; and (5) that is not destructive of the opposing party's theory of recovery. Id.; Lee v. Lee, 43 S.W.3d 636, 641–42 (Tex.App.–Fort Worth 2001, no pet.).

We conclude counsel's statements in this case are not “deliberate, clear, and unequivocal.” These statements do not rise to the level required to constitute judicial admissions. See Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d 887, 905 (Tex.2000) (finding no judicial admission by counsel's statement, “First of all, Your Honor, I think it's very important—do you have the agreement the plaintiff—the agreement that my client entered into?”).

We hold that the Guerrero parties did not judicially admit that Guerrero executed an agreement requiring arbitration of this dispute.

4. Was a Ruling Required on the Objection to Champion's Proof?

Next, Champion asserts the Guerrero parties have waived any objection to the admissibility of the Arbitration Agreement and other contract documents attached to its motion to compel arbitration. Although the Guerrero parties objected in the trial court to the admissibility of the contract documents based on the lack of authentication, the record contains no ruling on their objection.

Although the Guerrero parties also included a hearsay objection to the attachments, we treat their objection as one to the lack of authentication because the substance of the objection was that an unauthenticated document is hearsay. See, e.g., Tex. R. Evid. 803 (6); 902(10) (providing documents authenticated by a business records affidavit are exceptions to hearsay).

As we have previously recognized, we apply the same evidentiary standards for a motion to compel arbitration as for a motion for summary judgment. See TMI, Inc. v. Brooks , 225 S.W.3d 783, 794 (2007). Summary-judgment evidence must be presented in a form that would be admissible at trial. Hou–Tex, Inc. v. Landmark Graphics, 26 S.W.3d 103, 112 (Tex.App.–Houston [14th Dist.] 2000, no pet.). Defects in the form of authentication of attachments in support of a motion for summary judgment are waived without a proper objection in the trial court. See Mansions in the Forest, L.P. v. Montgomery Cnty., 365 S.W.3d 314, 317 (Tex.2012) (holding that an objection is required to preserve a complaint that a purported affidavit lacks a jurat or other indication that it was sworn to because it is an objection to form); see also Ellen v. Brazos County Bail Bond Bd., 127 S.W.3d 42, 46 (Tex.App.–Houston [14th Dist.] 2003, no pet.) (holding complaint that summary-judgment proof was unauthenticated hearsay was waived where no objection was made at trial that the affidavit lacked proper authentication and specificity); Wakefield v. Wells Fargo Bank, N.A., No. 14–12–00686–CV, 2013 WL 6047031, at *2–*3 (Tex.App.–Houston [14th Dist.] Nov. 14, 2013, no pet.) (mem.op.) (holding objections that affidavits had errors and one affidavit was not based on personal knowledge were defects of form that were required to be ruled on by the trial court to preserve error).

However, “[a] complete absence of authentication is a defect of substance that is not waived by a party failing to object and may be urged for the first time on appeal.” Blanche v. First Nationwide Mfg. Corp., 74 S.W.3d 444, 451 (Tex.App.–Dallas 2002, no pet.); Mayo, No. 14–07–00491–CV, 2008 WL 4355259, at *5 (holding no objection is required to preserve error challenging unauthenticated or unsworn documents, or documents not supported by an affidavit). Objections to defects in the substance of summary-judgment proof are not required to be first presented to, and ruled on by, the trial court. See Green v. Indus. Specialty Contractors, Inc., 1 S.W.3d 126, 130 (Tex.App.–Houston [1st Dist.] 1999, no pet.) (holding objection that summary-judgment affidavit was conclusory was not waived even though the objecting party failed to obtain a ruling from the trial court); Ramirez v. Transcon. Ins. Co., 881 S.W.2d 818, 829 (Tex.App.–Houston [14th Dist.] 1994, writ denied) (same); see also Perkins v. Crittenden, 462 S.W.2d 565, 568 (Tex.1970) (reversing summary judgment because an unverified copy of a promissory note was offered as summary-judgment evidence, even though the complaint was raised for the first time on appeal).

The Texas Supreme Court has recognized that it has “explicitly allowed parties to deviate” from the preservation requirements in limited circumstances. See Mansions, 365 S.W.3d at 317. In Mansions, the court cited Perkins, which addressed a complaint raised for the first time on appeal and distinguished the absence of an affidavit from a defective affidavit that is subject to correction. Id. (citing Perkins, 462 S.W.2d at 568 ). The absence of an affidavit verifying a copy of the instrument attached as summary judgment proof amounts to no proof. See id. In this case, because Champion provided no affidavit, Perkins does not require a ruling on the objection. See id.

An examination of the cases that Champion cites in support of its contention that a ruling on the objection was required to preserve error reveals that the defects at issue were actually defects in form, not substance. See Hicks v. Humble Oil & Ref. Co., 970 S.W.2d 90, 93 (Tex.App.–Houston [14th Dist.] 1998, pet. denied) (stating objection to improper authentication was waived by failure to secure ruling) (emphasis added); Adi v. Prudential Prop. & Cas. Ins. Co, No. 14–01–01001–CV, 2003 WL 22908129, at *2 (Tex.App.–Houston [14th Dist.] Dec. 11, 2003, pet. denied) (mem.op.) (stating a pleading attached as an exhibit was not required to be authenticated and an objection to hearsay contained in affidavit was one of form that was waived by the failure to obtain a written ruling) (citing Rogers v. Continental Airlines, Inc., 41 S.W.3d 196, 200 (Tex.App.–Houston [14th Dist.] 2001, no pet.) (stating objection that exhibits were not properly authenticated was waived because the record contained no ruling) (emphasis added)). Therefore, these cases may be distinguished from the substantive defect in the present case where no affidavit or other authentication was provided.

We note that the preservation rules in summary judgment practice have sometimes caused confusion. See Mayo, No. 14–07–00491–CV, 2008 WL 4355259, at *6, n. 1 (Brown, J., concurring).

The court has granted en banc reconsideration to address an apparent conflict with Courtland Building Co. v. Jalal Family P'ship, 403 S.W.3d 265, 270–71, n. 4 (Tex.App.–Houston [14th Dist.] 2012, no pet.). In Courtland, which also addressed the denial of a motion to compel arbitration, this court stated in a footnote:

The Property Owners [the Jalals and the Family Partnership] did not object to Courtland's failure to authenticate the exhibits offered in support of motion to compel arbitration, thereby waiving such objections to form. See Commint Tech. Servs., Inc. v. Quickel, 314 S.W.3d 646, 651 (Tex.App.–Houston [14th Dist.] 2010, no pet.).

This statement does not address the issue before this Court in the present case because, in Courtland, there was no dispute that there was a valid arbitration agreement and authentication of the arbitration agreement was not at issue.

The Texas Supreme Court has held that the complete absence of authenticating evidence is a defect in substance that can be raised for the first time on appeal. See Mansions in the Forest, L.P., 365 S.W.3d at 317. This court's precedent holds the same. Mayo, No. 14–07–00491–CV, 2008 WL 4355259, at *5; see also Garza v. Wilson, No. 14–98–00928–CV, 2000 WL 64052, at *2 (Tex.App.–Houston [14th Dist.] Jan. 27, 2000, no pet.). The dissent predicts that the Texas Supreme Court might change the law in some future case, so therefore this court should go ahead and do so. That is not our function and we decline to trade precedent for prediction. Instead, we follow the Texas Supreme Court, and our prior precedent, and hold that the complete absence of authenticating evidence is a defect in substance that may be raised for the first time on appeal.

Every court of appeals that has considered this issue has held that the complete absence of authenticating evidence is a defect in substance. See Smith v. DeLooze, No. 13–14–00092–CV, 2015 WL 124447, at *5 (Tex.App.–Corpus Christi Jan. 8, 2015, no pet.) (mem.op.); Hernandez v. Gallardo, 458 S.W.3d 544, 548 (Tex.App.–El Paso 2014, pet. filed); Petroleum Analyzer Co. LP v. Olstowski, No. 01–09–00076–CV, 2010 WL 2789016, at *19 (Tex.App.–Houston [1st Dist.] July 15, 2010, no pet.) (mem.op.); Huffaker v. Wylie LP Gas, Inc., No. 07–08–0133–CV, 2009 WL 1506901, at *2 (Tex.App.–Amarillo May 29, 2009, pet. denied) (mem.op.); Gudur v. Tex. Dep't of Health, No. 03–03–00752–CV, 2005 WL 2673670, at *5 (Tex.App.–Austin Oct. 21, 2005, no pet.) (mem.op.); Blanche, 74 S.W.3d at 451; Llopa, Inc. v. Nagel, 956 S.W.2d 82, 87 (Tex.App.–San Antonio 1997, pet. denied); Peerenboom v. HSP Foods, Inc., 910 S.W.2d 156, 160 (Tex.App.–Waco 1995, no writ). In her dissent, Chief Justice Frost cites Gomez v. Allstate Tex. Lloyds Ins. Co., 241 S.W.3d 196, 202 (Tex.App.–Fort Worth 2007, no pet.), stating that it holds that a complete failure of authenticating evidence is a defect in form. It does not. The issue in Gomez was the lack of certification on a potentially self-authenticating public record, which is a defect in the form of authentication. See 241 S.W.3d at 202.

We hold the Guerrero parties did not waive their objection to the authentication and admissibility of the documents Champion offered to show the existence of an agreement to arbitrate.

IV. CONCLUSION

We conclude the trial court did not abuse its discretion in denying Champion's motion to compel arbitration because Champion failed to meet its burden to establish the existence of an arbitration agreement. See In re Bunzl USA, Inc., 155 S.W.3d at 207 (finding no abuse of discretion in denial of arbitration where the trial court could have reasonably concluded the existence of an agreement to arbitrate was not established); Grace Interest, LLC v. Wallis State Bank, 431 S.W.3d 110, 122–23 (Tex.App.–Houston [14th Dist.] 2013, pet. denied) (holding trial court did not err in refusing to compel arbitration where appellants did not establish the existence of a valid arbitration agreement covering the claims at issue because they failed to attach any arbitration agreements to their arbitration request). Because Champion did not establish the existence of an arbitration agreement, we need not address the other issues raised in the briefing. See Inland Sea, Inc., 420 S.W.3d at 57–59 (affirming an order denying arbitration on an alternate ground supported by the record).

We affirm the trial court's order denying Champion's motion to compel arbitration. Justices Boyce, Jamison, Donovan, and Brown join the En Banc Majority Opinion authored by Justice Wise. Chief Justice Frost authored an En Banc Dissenting Opinion. Justice Christopher authored an En Banc Dissenting Opinion, in which Justices McCally and Busby join.

Kem Thompson Frost, Chief Justice, en banc dissenting.

A majority of the en banc court affirms the denial of a motion to compel arbitration on a single basis—that the failure of the movant to authenticate the attached copy of the arbitration agreement is a defect in substance that may be raised for the first time on appeal. In reaching this result, the en banc court applies an exception to the waiver-by-failure-to-object doctrine in an authentication context, contrary to the key precedent from the Supreme Court of Texas. Because the en banc court's decision conflicts with the high court's precedent, I respectfully dissent.

The problem with the en banc court's exception is that it is at odds with the most recent pronouncement of the Supreme Court of Texas regarding the necessity of preserving error in the trial court as to objections to summary-judgment evidence. Under the course the high court has charted in Mansions in the Forest, L.P. v. Montgomery County, for this court to affirm based on the defect in authentication, the defect, even if it is substantive, must be recognized as an exception to the normal preservation-of-error rule. The defect in today's case does not justify the creation of an exception to this rule or to the important prudential considerations behind it. Thus, the claimants waived their objection to the defect by failing to object and obtain a ruling on their objection in the trial court. This court cannot affirm the trial court's order based on this defect and also keep on course with Mansions.

As pointed out by the en banc majority, the same rules apply to objections to evidence offered in a summary proceeding on a motion to compel arbitration.

.365 S.W.3d 314, 316–17 (Tex.2012) (per curiam).

See id. at 317.

Appellant/defendant Mike Hall Chevrolet, Inc. d/b/a Champion Chevrolet (“Champion”) filed a motion to compel arbitration based on an arbitration agreement between Rosa Guerrero and Champion. Champion attached to its motion a copy of the agreement reflecting signatures by Guerrero and by a Champion representative. In its motion, Champion asserted that Guerrero signed this agreement incident to the purchase of the vehicle in question. Champion also stated that a true and correct copy of the agreement was attached as Exhibit “A” to the motion to compel arbitration. Though the exhibit contained the agreement, it did not contain an affidavit or any sworn statements. Thus, Champion failed to authenticate this exhibit to Champion's motion to compel arbitration. The en banc majority affirms the trial court's denial of Champion's motion to compel arbitration based solely on this defect.

See Courtland Building Co. v. Jalal Family P'ship, 403 S.W.3d 265, 270 & n. 4 (Tex.App.–Houston [14th Dist.] 2012, no pet.).

See ante at pp. 699–709.

Even if all claimants objected to this defect in the trial court, they did not preserve error because none of them secured a ruling. For this court to affirm based on this defect, the defect must be one that may be raised for the first time on appeal rather than a defect subject to the normal rule that requires preservation of error in the trial court.

The majority agrees that the trial court did not rule on any such objections. See ante at p. 705–06.

See Mansions in the Forest L.P., 365 S.W.3d at 316–18. The majority states that, to affirm on this basis, the defect must be a defect in substance that may be raised for the first time on appeal. See ante at pp. 705–09.

In Courtland Building Company v. Jalal Family Partnership, this court reviewed a trial court's order denying a motion to compel arbitration. As in today's case, the movant failed to authenticate the attached copy of the contract containing the arbitration provision. We found this defect was a defect in form and that the appellees waived their complaint to it by failing to preserve error in the trial court. We held that the trial court erred in denying the motion to compel arbitration; we reversed the order and remanded with instructions for the trial court to compel arbitration. Today, the en banc court holds that the same defect is a defect in substance that may be raised for the first time on appeal and affirms the trial court's denial of a motion to compel arbitration based only on this defect. Holding that the defect in authentication may be raised for the first time on appeal conflicts with both preservation-of-error principles and with Mansions's teaching.

See Courtland Building Co., 403 S.W.3d at 268–71 & n. 4.

See i d. at 270–71 & n. 4.

See id.

See id. at 277.

See ante at pp. 702–09.

Recharting the Course: Preservation–of–Error Analysis

The Mansions case maps the preservation-of-error analysis. In this 2012 opinion, the Supreme Court of Texas notes that, though an affidavit need not contain a jurat, if a purported affiant does not swear to the statements in a purported affidavit, then the written statement is unsworn and “no affidavit at all.” The purported affiant in Mansions did not swear to the statements in the “affidavit”; thus, there was “no affidavit at all,” and the document amounted to nothing but unsworn statements. Nonetheless, the high court held that the normal error-preservation rule applies to the failure to submit sworn statements; therefore, these unsworn statements still were treated as if they were proper summary-judgment evidence because the opposing party failed to preserve error in the trial court.

Mansions in the Forest L.P., 365 S.W.3d at 316–17. This characterization suggests that this defect would be a defect in substance if the defect-of-form/defect-of-substance analysis applied.

See id.

See id. at 316–18.

The reasoning of the Mansions court as to the necessity of a trial-court objection and adverse ruling signals a shift because it contradicts the reasoning the high court employed four decades earlier in Perkins v. Crittenden as to why no preservation of error was required in the trial court. In Perkins, the trial court granted summary judgment in a suit on a promissory note, and the high court emphasized the importance in a note case of having the claimant submit either the original promissory note or a sworn copy of the note. In that case, the claimant failed to do either, submittingonly an unsworn copy of the promissory note, but the defendants did not object to this defect in the trial court. The Perkins court held that the failure to submit an affidavit or other sworn statement regarding the promissory note was not a defect in form and that the defendants could complain of this defect for the first time on appeal. Thus, the Perkins court held that a party's submission of an unsworn promissory note as summary-judgment evidence could be challenged for the first time on appeal, but the Mansions court held that a party's submission of unsworn statements from a purported affiant could not be challenged for the first time on appeal.

Compare id. at 316–18, with Perkins v. Crittenden, 462 S.W.2d 565, 568 (Tex.1970).

See Perkins, 462 S.W.2d at 566–67.

See id. at 566–68.

See id. at 568.

See Mansions in the Forest, L.P., 365 S.W.3d at 316–17; Perkins, 462 S.W.2d at 566–68.

Declining to apply Perkins, the Mansions court characterized the Perkins holding as one of the “limited circumstances” in which the high court has allowed parties to deviate from the general preservation-of-error requirement. The Mansions court stated that the Perkins holding still survives and characterized this holding as “addressing an unverified copy of a promissory note offered as summary judgment evidence, which was complained about for the first time on appeal.” Today's case does not fall within this “limited circumstance.”

See Mansions in the Forest, L.P., 365 S.W.3d at 317.

Id.

A promissory note is not like other documents. It is a special piece of paper—a negotiable instrument that can be transferred from one holder to another and ultimately exchanged for money. Because promissory notes are governed by a unique set of rules, it is not surprising that the Supreme Court of Texas would recognize an exception to the general preservation-of-error rule for promissory notes. An arbitration agreement is not a promissory note. Perkins does not apply to arbitration agreements. It is not on point.

Because today's case does not involve the proffer of an unsworn or unverified promissory note as summary-judgment evidence, under the Mansions precedent, the Perkins case offers no support for the en banc court's holding. Yet, the en banc majority relies on Mansions and Perkins to hold that Champion's failure to submit an affidavit authenticating the attached copy of the arbitration agreement is a defect in substance that may be challenged for the first time on appeal.

See id.

See ante at pp. 706–09.

Applying the Mansions Framework

Significantly, the Mansions court did not adopt or follow the defect-of-form/defect-of-substance dichotomy the en banc majority invokes today. Though the high court noted that a half-dozen courts of appeals (including the Fourteenth Court of Appeals) had held that the defect in question was a defect of substance that may be raised for the first time on appeal, the Mansions court did not address whether the defect was one of form or one of substance. Instead, the Mansions court framed the issue as whether an exception to the normal error-preservation rule was justified. Rather than conclude that the defect at issue was a defect of form, the Mansions court simply determined that no exception to the normal error-preservation rule was justified.

See Mansions in the Forest, L.P., 365 S.W.3d at 316–18; Timothy Patton, Summary Judgments in Texas § 6.10[1][d] (3d ed.2012) (noting that the Mansions court did not decide the issue based on the form versus substance analysis).

See Mansions in the Forest, L.P., 365 S.W.3d at 316–18.

See id.; Timothy Patton, Summary Judgments in Texas § 6.10 [1][d] (3d ed.2012).

See Mansions in the Forest, L.P., 365 S.W.3d at 317–18.

To get the right answer, we must ask the right question: Does the normal preservation-of-error rule apply or does today's case present a limited circumstance in which it does not apply? The normal rule applies. Instead of treating the arbitration agreement like a promissory note in a “limited circumstances” case, the en banc court should conclude that no exception to the normal error-preservation rule is justified for this deficiency. Therefore, the appellees waived the defect by their failure to preserve error in the trial court.

See Mansions in the Forest, L.P., 365 S.W.3d at 316–18; Timothy Patton, Summary Judgments in Texas § 6.10[1][d] (3d ed.2012) (stating that, while the Mansions opinion “specifically dealt only with the issue of an omitted jurat, the court emphasized that ‘important prudential considerations' justify preservation of error requirements and that only ‘in certain limited circumstances' will parties be allowed to bypass Rule 33.1”).

The rule requiring error preservation is grounded in principles of fairness and efficiency, under which an appellate court ought not entertain a complaint that was not ruled on by the trial court. The Supreme Court of Texas honored these principles in Mansions, signaling that except in “limited circumstances” appellate courts should not deviate from the general preservation-of-error rule. There is no basis for deviating in today's case.

See In re B.L.D., 113 S.W.3d 340, 350, 353–54 (Tex.2003) (noting that the preservation-oferror rule promotes fairness to litigants, accurate judicial decision-making, and judicial economy); In re L.M.I., 119 S.W.3d 707, 708 (Tex.2003) (noting that the preservation-of-error rule is not a mere technical nicety and that appellate review of unpreserved error undermines the intent to ensure finality).

Conclusion

The en banc majority concludes that, in addition to being bound by Mansions, this court is bound by the decisions of prior panels of this court to hold that a complete failure to authenticate an exhibit is a defect in substance that may be raised for the first time on appeal. But, today's case is not determined by principles of stare decisis. The Supreme Court of Texas has not addressed the precise issue the en banc court decides today. As noted, judicial dicta in Mansions support an analysis under which this court should conclude that error must be preserved in the trial court. Though prior panel decisions of this court support the proposition that the defect is a defect of substance that may be raised for the first time on appeal, these opinions conflict with Mansions. In any event, the en banc court is not bound by this court's prior panel opinions. The en banc court is free to choose the analysis and the rule to apply today.

See ante at pp. 707–08.

See Mansions in the Forest, L.P., 365 S.W.3d at 316–18; Timothy Patton, Summary Judgments in Texas § 6.10[1][d] (3d ed.2012).

See Glassman v. Goodfriend, 347 S.W.3d 772, 781–82 & n. 8 (Tex.App.–Houston [14th Dist.] 2011, pet. denied) (en banc). The en banc majority also states that every intermediate court of appeals that has addressed this issue has held that the defect is a defect of substance that may be raised for the first time on appeal. See ante at pp. 707–08, n. 5. This statement is incorrect. See Gomez v. Allstate Texas Lloyds Ins. Co., 241 S.W.3d 196, 202 (Tex.App.–Fort Worth 2007, no pet.). In Gomez, the appellants complained that the movant “failed to authenticate the copy of the underlying petition attached to [its] motion for summary judgment because [the document] was neither certified nor supported by affidavit.” Id. The Gomez court held that this failure to authenticate the attached document was a defect of form and that the appellants waived their complaint by failing to timely object in the trial court. See id.
Though the en banc majority is correct that many intermediate courts of appeals have reached the same conclusion as the en banc majority does today, the en banc court is not bound by these decisions. Most of these cases were decided before Mansions and the intermediate courts in the postMansions cases do not address the effect of the Mansions court's analysis or invoke the Mansions court's preservation-of-error framework. Moreover, in Mansions the Supreme Court of Texas noted that its decision conflicted with the decisions of eight different intermediate courts of appeals (including the Fourteenth Court of Appeals) and did not cite any court of appeals case that supported its analysis. See Mansions in the Forest, L.P., 365 S.W.3d at 317–18.

In Mansions, the Supreme Court of Texas set the course we are to follow in determining whether the normal preservation-of-error rule applies to the authentication defect at issue in today's case. Under this precedent, the authentication of arbitration agreements does not constitute a “limited circumstance” justifying a deviation from the general preservation-of-error requirement. The en banc court should apply the normal preservation-of-error rule and hold that the failure to authenticate the copy of the arbitration agreement is a defect which the appellees waived by failing to secure a ruling from the trial court. Justice Wise authored the En Banc Majority Opinion, in which Justices Boyce, Jamison, Donovan, and Brown joined. Chief Justice Frost authored an En Banc Dissenting Opinion. Justice Christopher authored an En Banc Dissenting Opinion, in which Justices McCally and Busby joined.

Tracy Christopher, Justice, en banc dissenting

This case is a classic example where a rule of procedure would clarify the procedures for motions to compel arbitration and prevent unnecessary appeals. It also showcases the unnecessary expense involved in cases where we do not stick to the rule that objections should be made in the trial court and that the trial court should rule on the objections.

Motions to compel arbitration are governed by section 171.021 of the Texas Civil Practice and Remedies Code. This section, entitled “Proceeding to Compel Arbitration,” provides in part:

(a) A court shall order the parties to arbitrate on application of a party showing:

(1) an agreement to arbitrate; and

(2) the opposing party's refusal to arbitrate.

(b) If a party opposing an application made under Subsection (a) denies the existence of the agreement, the court shall summarily determine that issue....
SeeTex. Civ. Prac. & Rem. Code Ann. § 171.021 (West 2011).

This would appear to be a relatively straightforward proceeding, requiring the party opposing arbitration to deny the arbitration agreement's existence. Guerrero did not. Yet today our court denies relief to Champion for the sole reason that Champion failed to properly authenticatethe arbitration agreement—a matter that Champion can easily solve on remand by obtaining a business-records affidavit from Penny Perng. Guerrero objected to the authenticity of the documents in the trial court but she did not get a ruling on her objections.

In fact, that is what happened after we issued our original panel opinion in this case.

Relying on summary-judgment evidentiary procedures, the majority concludes that Champion failed to properly prove up the arbitration agreements. If our record consisted of only Champion's amended motion to compel arbitration, I might agree. But it contains much more. Guerrero deposed several Champion witnesses—including Perng, the custodian of Champion's records. Perng's deposition was attached to one of Guerrero's responses. Perng testified that she brought the original purchase and warranty files to the deposition; that the files contained all of the records related to the Guerrero sale and any original documents signed by Guerrero; and that the files were kept contemporaneously in the ordinary course of business and as an ordinary practice. She also testified that these files contained an Arbitration Agreement, Buyer's Order and Invoice, Motor Vehicle Retail Installment Sales Contract, and Security Agreement, and she explained details regarding each document. Guerrero's attorney saw the original documents with Guerrero's signature. That is why—in good faith—he could not argue in his pleadings or at the hearing that she did not sign the agreements; it is why he admitted that she did sign “various documents”; and it is why he specifically admits that she signed an agreement without an arbitration clause and with a merger clause.

Under Texas Rule of Evidence 901, “The requirement of authentication or identification as a condition precedent to admissibility is satisfied by evidence sufficient to support a finding that the matter in question is what its proponent claims.” As Guerrero's response showed, Champion's witnesses did so. Cf. Jordan v. Geigy Pharms., 848 S.W.2d 176, 181 (Tex.App.–Fort Worth 1992, no writ) (holding nonmovant may rely on movant's summary-judgment evidence). Because the majority concludes that a fact question exists as to the authenticity of the agreements—despite this evidence, and even though Guerrero introduced no controverting affidavit and did not deny the genuineness of the agreements—I respectfully dissent.

During the pendency of this appeal, Rule 901 was revised to read as follows: “To satisfy the requirement of authenticating or identifying an item of evidence, the proponent must produce evidence sufficient to support a finding that the item is what the proponent claims it is.” See Tex. Sup.Ct. Misc. Dkt. No. 15–9048 (Mar. 12, 2015).

Justice Wise authored the En Banc Majority Opinion, in which Justices Boyce, Jamison, Donovan, and Brown joined. Chief Justice Frost authored an En Banc Dissenting Opinion. Justice Christopher authored an En Banc Dissenting Opinion, in which Justices McCally and Busby joined.


Summaries of

In re in the Estate of Guerrero

Court of Appeals of Texas, Houston (14th Dist.).
Apr 23, 2015
465 S.W.3d 693 (Tex. App. 2015)

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Case details for

In re in the Estate of Guerrero

Case Details

Full title:In the Estate of Rosa Elvia Guerrero, Deceased

Court:Court of Appeals of Texas, Houston (14th Dist.).

Date published: Apr 23, 2015

Citations

465 S.W.3d 693 (Tex. App. 2015)

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