Kevin Jewell, Justice.
We withdraw our opinion dated June 8, 2017, and issue this substitute opinion. Appellants Camil Kreit, M.D., and Samir Kreit, M.D.'s motion for rehearing is overruled.
Brothers Camil and Samir Kreit appeal the trial court's final judgment confirming an arbitration award in favor of Brewer & Pritchard, P.C. for fees due under a contract for legal services. Camil and Samir argue the trial court erred in confirming, rather than vacating, the award because they did not agree to arbitrate disputes with Brewer & Pritchard, P.C. in their individual capacities. For the reasons stated below, we affirm the judgment.
Camil and Samir are medical doctors and representatives of Cleveland Imaging and Surgical Hospital, L.L.C. d/b/a Doctors Diagnostic Hospital (CISH). In July 2014, CISH was involved in several ongoing lawsuits. In one of the lawsuits, Camil and Samir were named as individual defendants. Camil and Samir met with attorney Mark Brewer of Brewer & Pritchard
A key dispute between the parties to this appeal is whether Brewer & Pritchard was retained to provide legal services for CISH, or whether the firm was retained to provide services for Camil and Samir in
Camil and Samir contend that they only intended to obtain representation on behalf of CISH, and that they never signed an agreement for individual representation. They allege irregularities with the July 31, 2014 fee agreement and contend that Brewer & Pritchard co-mingled individual pages from separate proposals to create a "Frankenstein" contract to which Camil and Samir never agreed as a whole. All of the proposed fee agreements, including the July 31, 2014 fee agreement, contained arbitration clauses.
In July and August 2014, Brewer & Pritchard performed general corporate legal services and sent an invoice addressed to Camil and Samir for the services rendered. Camil and Samir declined to pay Brewer & Pritchard and instead told the law firm it must look to CISH for payment. Brewer & Pritchard then initiated an arbitration proceeding against Camil and Samir with the American Arbitration Association pursuant to the arbitration clause in the July 31, 2014 fee agreement. Brewer & Pritchard alleged that it provided legal services to Camil and Samir pursuant to the agreement and that Camil and Samir breached the agreement by failing to pay. Brewer & Pritchard sought a total of approximately $40,000 in attorney's fees and $1,175 in expenses.
Camil and Samir both appeared pro se in the arbitration. Samir filed a special appearance and objection, claiming that the arbitrator lacked jurisdiction because Samir did not sign the July 31, 2014 fee agreement in his individual capacity and thus the agreement's arbitration clause was unenforceable against him individually. Samir alleged that his initials were not on the document,
Camil did not join in Samir's special appearance and objection in the arbitration proceeding. On appeal, Camil claims he presented arguments challenging the arbitrator's jurisdiction in the arbitration proceeding, but the record does not contain any of his pleadings or filings from the arbitration demonstrating that he raised an arbitrability challenge based upon his
The arbitrator conducted the arbitration as "documents-only" in accordance with the arbitration clause in the agreement. The arbitrator then issued an award in which he found that Camil and Samir both signed the July 31, 2014 fee agreement; the agreement, including the arbitration provision, bound them in their individual capacities; the agreement was not void, invalid or otherwise unenforceable; the dispute fell within the scope of the arbitration agreement; and Camil and Samir breached the agreement by failing to pay the fees. The arbitrator awarded Brewer & Pritchard its past due attorney's fees, interest on the fees, costs, and attorney's fees incurred in the arbitration.
Brewer & Pritchard then filed the underlying action to confirm the arbitration award. Camil timely filed a verified "motion to quash or set aside motion for confirmation," which the trial court broadly interpreted as a motion to vacate the award. Camil asserted numerous arguments in the motion to vacate and attached documents in support of the motion. As relevant here, Camil asserted that no arbitration agreement existed as to him individually and, further, the arbitrator exceeded his authority by failing to "pass the case on to a court of competent jurisdiction."
On the day the trial court heard Brewer & Pritchard's motion to confirm the award, Samir filed his own motion to vacate the arbitration award. He attached an affidavit supporting his statement of the facts and several documents. Just as his brother Camil had asserted in his motion to vacate, Samir asserted, among other things, that no arbitration agreement existed as to Samir individually and that the trial court had the duty to determine whether a binding arbitration agreement existed in the first instance.
At the hearing on the motion to confirm, the trial court heard argument from Camil and Samir regarding their position that they did not sign the fee agreement in their individual capacities. The trial court allowed Camil and Samir to submit exhibits, including the various contemplated draft fee agreements. The trial court took the motion to confirm and the motion to vacate filed by Camil under advisement. Three days later the trial court denied Camil's motion to vacate the award
Camil and Samir both filed timely motions to set aside the judgment or alternative motions for new trial. In their post-judgment motions, Camil and Samir argued that the trial court must hold an evidentiary hearing regarding whether an agreement to arbitrate existed. The trial court held another oral hearing on the post-judgment motions, after which the court denied Camil and Samir's post-judgment motions. This appeal followed.
Camil and Samir challenge the trial court's judgment confirming the arbitration
We review a trial court's decision to confirm or vacate an arbitration award under a de novo standard of review. D.R. Horton-Tex., Ltd. v. Bernhard, 423 S.W.3d 532, 534 (Tex. App. — Houston [14th Dist.] 2014, pet. denied). Texas law favors arbitration and thus review of arbitration awards is very narrow. See Hoskins v. Hoskins, 497 S.W.3d 490, 494 (Tex. 2016); Southwinds Express Constr., LLC v. D.H. Griffin of Tex., Inc., 513 S.W.3d 66, 70 (Tex. App.-Houston [14th Dist.] 2016, no pet.). We afford the award great deference, indulging reasonable presumptions in its favor and none against it. Southwinds Express Constr., 513 S.W.3d at 70 (citing CVN Grp., Inv. v. Delgado, 95 S.W.3d 234, 238 (Tex. 2002)).
Brewer & Pritchard moved to confirm the arbitrator's award pursuant to Texas General Arbitration Act (TAA) section 171.087.
Further, to successfully vacate an arbitration award under section 171.088, a party must timely file a motion and prove at least one of the statute's enumerated grounds for vacatur. The deadline to file a motion to vacate an award under section 171.088 is not later than ninety days after the date a copy of the award is delivered to the applicant, except as to the vacatur grounds set forth in subsection (a)(1). Tex. Civ. Prac. & Rem. Code § 171.088(b); New Med. Horizons II, Ltd. v. Jacobson, 317 S.W.3d 421, 430 (Tex. App.-Houston [1st Dist.] 2010, no pet.). The deadline to file a motion to vacate based on a ground set forth in subsection (a)(1) is not later than the 90th day after the date the ground for the application is known or should have been known. Tex. Civ. Prac. & Rem. Code § 171.088(b).
The arbitrator issued the award on June 12, 2015, and the AAA emailed the
In his motion for rehearing, Samir argues that he timely filed a separate document — entitled "Demand to Set Aside, Quash, or in the Alternative to Discharge Arbitration Hearing and Award" on July 20, 2015 — within the ninety-day deadline for seeking to vacate an arbitration award. Samir contends that this motion constitutes a timely-filed motion to vacate. The record, however, does not contain a file-stamped copy of this document indicating that it was filed by the clerk on July 20, 2015. An un-stamped copy of the motion first appears in the record as an exhibit to "Defendant Samir Kreit's Notice of Clerical Failure to Record Motion Filed July 20, 2015 For Demand to Set Aside, Quash or in the Alternative to Discharge Arbitration Hearing and AwardSet [sic] Aside Award" filed on December 30, 2015.
According to Samir, the "Demand to Set Aside, Quash, or in the Alternative to Discharge Arbitration Hearing and Award" was filed timely because he mailed it to the clerk on July 20, 2015. Samir cites the mailbox rule set forth in Texas Rule of Civil Procedure 5, which provides in pertinent part:
Tex. R. Civ. P. 5 (emphasis added). A court may deem a document timely filed under this rule if: (1) the document was placed in the United States mail on or before the filing deadline; (2) the document was in an envelope or wrapper properly addressed and stamped; and (3) the document was received by the clerk within ten days of the deadline. See id.; Stokes v. Aberdeen Ins. Co., 917 S.W.2d 267, 268 (Tex. 1996) (per curiam).
The record fails to support Samir's position with respect to the last element — that the document in question was received by the clerk "not more than ten days tardily." As reflected in the record, Samir deposited his "Demand to Set Aside, Quash, or in the Alternative to Discharge Arbitration Hearing and Award" in the United States mail on July 20, 2015, well within the ninety-day deadline set forth in section 171.088(b). Tex. Civ. Prac. & Rem. Code Ann. § 171.088(b). The record also includes the certified mail "green card" showing the envelope was properly addressed to the district clerk and indicates that it was received by the clerk's office. However, the clerk did not file the document. The green
To benefit from Rule 5, a party must show more than that the document was timely mailed and ultimately received; the party also must prove that the clerk received the document within ten days of the applicable deadline to which the document relates. See Stokes, 917 S.W.2d at 268 ("The clerk still must receive the document within ten days to perfect the filing."); cf. McCray v. Mulder, No. 05-08-00420-CV, 2008 WL 2600700, at *1 (Tex. App.-Dallas July 2, 2008, pet. denied) (mem. op.) (notice of appeal untimely under mailbox rule found in Rule 9.2(b) of the Texas Rules of Appellate Procedure where clerk received notice of appeal, but received it after ten-day deadline).
Samir argues that because he was pro se in the trial court and not required to file documents electronically, "[h]e should not be penalized because both the district clerk and the post office dropped the ball." In support, Samir cites Ramos v. Richardson, 228 S.W.3d 671, 673 (Tex. 2007) (per curiam), in which the Supreme Court of Texas noted its prior holdings that a prison inmate should not be penalized by errors on the part of officials over whom the inmate has no control. We are not persuaded. Samir, though self-represented, was not a prison inmate, and thus did not lack the ability to ensure his document was timely filed under the mailbox rule.
The Court of Criminal Appeals, in discussing why a different rule for prisoners is warranted, contrasted the lack of control over filings by prison inmates with the various options available to other litigants. See Campbell v. State, 320 S.W.3d 338, 343 (Tex. Crim. App. 2010). The court specifically noted that, unlike prison inmates, other litigants can place a document in the United States mail and:
Id. (quoting Houston v. Lack, 487 U.S. 266, 271, 108 S.Ct. 2379, 2382, 101 L.Ed.2d 245 (1988)).
Likewise, Samir had the option of following the progress of his mailing and ensuring that it was received by the clerk within ten days of the relevant deadline. He did not do so. Alternatively, he could have presented evidence in the trial court, by means other than the green card, establishing the date of receipt. For example, Samir could have offered evidence showing when he received the green card addressed to the district clerk back from the postal service, which potentially allows an inference that the filing was received by the clerk within ten days of the deadline. The record as it stands does not establish that the clerk received Samir's July 20, 2015 motion within ten days of the due date.
We overrule Samir's two issues on appeal.
Camil sought vacatur of the arbitration award by a timely motion, which included at least one of the arguments for vacatur he advances on appeal.
Camil alleged multiple arguments in his motion to vacate, which he filed pro se. Interpreting his motion liberally,
On appeal, Camil first contends the arbitration award is inherently "invalid" because the issue of whether an arbitration agreement existed should have been decided by the trial court, and Brewer & Pritchard never "invoked" that "procedural step." To the extent Camil complains in his first issue that the trial court erred in confirming the award because Brewer & Pritchard was required to, but did not, invoke a necessary "procedural step" in the trial court, we reject that portion of his argument for several reasons. First, because Camil did not seek a
Second, Camil cites no authority for the proposition that Brewer & Pritchard was obligated to initiate a lawsuit in district court while its arbitration proceeding was pending, nor does he identify the procedural vehicle Brewer & Pritchard would use to file such a lawsuit. His argument lacks merit under our precedent. See Ewing v. Act Catastrophe-Tex. L.C., 375 S.W.3d 545, 550, 551 (Tex. App.-Houston [14th Dist.] 2012, pet. denied) (noting that under the TAA's plain language, parties are not required to file a motion to compel arbitration before proceeding to arbitration, even when the existence of an agreement is challenged).
Finally, Camil did not properly raise all aspects of his first issue in the trial court. Though Camil's motion to vacate asserts that no agreement to arbitrate existed as to him individually, he did not raise the lack of ruling on arbitrability prior to the arbitration proceeding as a ground for vacatur or assert that Brewer & Pritchard was obligated to raise the issue in the trial court before obtaining an arbitration award. As a result, he cannot advance these arguments on appeal to obtain reversal. See Tex. R. App. P. 33.1(a)(1); Ewing, 375 S.W.3d at 549.
We overrule Camil's first issue.
In his second issue, Camil argues the arbitrator exceeded his powers in ruling on the arbitrability issue, a matter reserved for the trial court. Camil relies on section 171.088(a)(3)(A), which requires vacatur if the arbitrator "exceeded [his] powers." Tex. Civ. Prac. & Rem. Code § 171.088(a)(3)(A).
As mentioned, all of Camil's appellate arguments depend upon the same premise: he did not sign the July 31, 2014 fee agreement in his individual capacity and thus no arbitration agreement exists. The TAA specifically includes a provision for vacating an arbitration award when an arbitration agreement does not exist. Id. § 171.088(a)(4). Section 171.088(a)(4) requires a party challenging the existence of an arbitration agreement to prove: (1) there was no agreement to arbitrate; (2) the issue was not determined adversely to the party in a proceeding to compel or a proceeding to stay arbitration; and (3) the party did not participate in the arbitration without raising the objection. Id. But, in his second issue, Camil neither cites section 171.088(a)(4) nor discusses its text. Instead, he cites only section 171.088(a)(3)(A) and characterizes his challenge to the award as one involving an arbitrator who "exceeded his power" because the arbitrator issued the award absent Camil's agreement to arbitrate.
Camil's contention that the arbitrator exceeded his power because Camil "did not enter into [an] agreement in [his] individual capacit[y]" is in substance the same argument that there is no agreement to
Thus, the essence of Camil's position on appeal is that no agreement to arbitrate exists. Accordingly, we conclude that his argument for vacatur is properly considered under section 171.088(a)(4) as opposed to 171.088(a)(3)(A). See Penhollow Custom Homes, LLC v. Hawkins, No. 05-07-01101-CV, 2008 WL 3020812, at *2 (Tex. App.-Dallas Aug. 6, 2008, pet. denied) (mem. op.). In Penhollow, the court addressed Penhollow's argument that a trial court erred in confirming an arbitration award that erroneously included him individually as a party to the arbitration when he was not a party to the contract. Id. There, as here, the appealing party opposed confirmation of the arbitration award on the ground that he did not enter into an arbitration agreement. Further, Penhollow, like Camil, attacked the award on the basis that the arbitrator "exceeded his authority" by issuing an award against him when he never agreed to arbitrate. Id. The court, however, analyzed the complaint under section 171.088(a)(4) because Penhollow sought vacatur of the award on the grounds that no agreement to arbitrate bound him individually. See id. Concluding that Penhollow failed to raise his objection in the arbitration proceeding as section 171.088(a)(4) requires, the court affirmed the award's confirmation. Id.
We agree with the Fifth Court of Appeals that a party's challenge to an arbitration award on the ground that no agreement to arbitrate exists is properly considered under section 171.088(a)(4) as opposed to section 171.088(a)(3)(A). See id.
As the party seeking to vacate the award, Camil "bears the burden of presenting a complete record that establishes grounds for vacatur." Amoco D.T. Co. v. Occidental Petroleum Corp., 343 S.W.3d 837, 841 (Tex. App.-Houston [14th Dist.] 2011, pet. denied); see also Patel v. Moin, No. 14-15-00851-CV, 2016 WL 4254016, at *3 (Tex. App.-Houston [14th Dist.] Aug. 11, 2016, pet. denied) (mem. op.). Under section 171.088(a)(4), Camil must provide proof that: (1) there was no agreement to arbitrate; (2) the issue had not already been decided adversely against him in a proceeding to compel or stay arbitration; and (3) he did not participate in the arbitration without raising the objection he now makes on appeal. See Tex. Civ. Prac. & Rem. Code § 171.088(a)(4); Aspri Invs. LLC v. Afeef, No. 04-10-00573-CV, 2011 WL 3849487, at *4 (Tex. App.-San Antonio Aug. 31, 2011, pet. dism'd) (mem. op.); see also Southwinds Express Constr., 513 S.W.3d at 83-84 (Frost, C.J., concurring).
Here, the record does not show that Camil objected to the lack of an agreement to arbitrate in the arbitration proceeding. No arbitration transcripts are contained in our record. Camil's motion to vacate does not attach admissible evidence proving that he raised the objection in the arbitration. Camil did not bring forth any pleadings or documents filed by him in the arbitration. In his appellate brief, Camil contends that he asserted the objection by and through Samir in the arbitration, but the record does not bear this out. Though Samir filed a special appearance in the arbitration and asserted the lack of an arbitration agreement, Camil did not sign or join that document, and it was not filed on Camil's behalf. The arbitration award references an email sent to the arbitrator by Camil but that email does not appear in our record and was not offered or admitted in connection with Camil's motion to vacate.
We cannot determine from the record the specific objections, if any, Camil asserted in the arbitration, including whether he argued that he did not sign an agreement to arbitrate. Thus, we cannot determine whether he made the objection that he now makes on appeal, as required under section 171.088(a)(4). As a result, Camil did not meet his burden of establishing this ground for vacatur. See Penhollow, 2008 WL 3020812, at *2; Aspri Invs. LLC, 2011 WL 3849487, at *4; see also Southwinds Express Constr., LLC, 513 S.W.3d at 84 (Frost, C.J., concurring).
Finally, Camil also argues that the award was invalid and should have been vacated because the trial court did not determine the issue of the applicability of the arbitration provision by holding an evidentiary hearing, citing Jack B. Anglin Co., Inc. v. Tipps, 842 S.W.2d 266 (Tex.
In any event, the record shows that the trial court held oral hearings on both the motion to vacate and motion for new trial. During the hearing on the motion to vacate, the court admitted evidence offered by Camil. During the subsequent hearing on the motion for new trial, the court also accepted Camil's offer of additional documents. Camil did not attempt to call any witnesses at either hearing.
But even if the trial court had failed to hold an evidentiary hearing, the record does not show that Camil was harmed by the alleged error. Tex. R. App. P. 44.1(a) (to obtain reversal on appeal, the record must show that error complained of probably caused the rendition of an improper judgment). We conclude that Camil's alleged error, if any, was harmless because the record does not show that Camil has evidence he raised his objection in the arbitration proceedings. Without establishing that he raised his objection in the arbitration proceedings, Camil cannot obtain vacatur of the award under the TAA. See Tex. Civ. Prac. & Rem. Code § 171.088(a)(4). Any failure to hold an evidentiary hearing on the existence of an agreement thus did not cause the rendition of an improper judgment. See G & H Towing Co. v. Magee, 347 S.W.3d 293, 298 (Tex. 2011).
We overrule Camil's second issue.
Brewer & Pritchard requests that we award it damages under Texas Rule of Appellate Procedure 45 because it contends Camil's and Samir's appeal is frivolous. Rule 45 authorizes a court of appeals, in its discretion, to award just damages in cases where an appeal is objectively frivolous. See Glassman v. Goodfriend, 347 S.W.3d 772, 782 (Tex. App.-Houston [14th Dist.] 2011 pet. denied) (en banc). Although we have overruled both issues asserted by Camil and Samir, we do not find that the appeal was objectively frivolous. We deny the request for damages under Rule 45.
The trial court properly confirmed the arbitration award in favor of Brewer & Pritchard because Camil and Samir did not establish any statutory grounds for vacatur. Accordingly, we affirm the trial court's judgment.
