Lee, Dionne v. Rosen, Newey & Von Blon, P.C., Rosen & Newey, P.C. and Marian S. Rosen ( 2002 )

Affirmed and Opinion filed August 22, 2002

Affirmed and Opinion filed August 22, 2002.

In The

Fourteenth Court of Appeals

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NO. 14-00-00759-CV

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DIONNE LEE, Appellant

V.

ROSEN, NEWEY & VON BLON, P.C., ROSEN & NEWEY, P.C.,

AND MARIAN S. ROSEN, Appellees

On Appeal from the 234th District Court

Harris County, Texas

Trial Court Cause No. 99-58095

O P I N I O N

            Dionne Lee appeals a summary judgment enforcing a settlement agreement and an order confirming an arbitration award.  This case involves a dispute about an agreement reached at an appellate mediation of Lee’s legal malpractice suit against Rosen, Newey & Von Blon, P.C., Rosen & Newey, P.C., and Marion S. Rosen (“Rosen”).  We affirm.

PROCEDURAL BACKGROUND

            This case has a tortured procedural history.  In 1992, Lee retained Rosen to represent her in several lawsuits.  Rosen withdrew from the cases in 1995.  In 1997 Lee sued for malpractice, and the district court granted summary judgment in favor of Rosen in 1998.  Lee appealed (the first appeal bears this court’s docket No. 14-99-0120-CV).  This Court abated that appeal and ordered the parties to appellate mediation.

            A mediation was held on June 1, 1999, before Alvin Zimmerman as mediator with all parties present.  Lee appeared pro se, as she has throughout the prior legal malpractice claim and in this case.  The appellate mediation was successful and all parties voluntarily signed a Binding Settlement Agreement (“BSA”).  The BSA contemplated that a more detailed set of documents was needed to effectuate the settlement.  Rosen agreed to deliver drafts of the additional settlement documents to Lee by June 8, 1999.  However, no settlement documents were delivered to Lee until June 11, 1999, three days later.  Apparently regretting the fact she had settled, Lee refused to execute and return the documents at that time.  She argues that the late delivery of the further settlement documents rendered the BSA “null and void” or voidable. 

            Pursuant to the arbitration clause in the BSA, Rosen asked the arbitrator, who was again Alvin Zimmerman, to determine whether Lee had the right to rescind the BSA under these circumstances.  On July 13, 1999, Zimmerman held a teleconference arbitration hearing in which Lee did not participate.  On July 14, 1999, he issued a Decision of Arbitrator.  The Arbitrator’s Decision listed findings including: (1) time was not of the essence; (2) both parties had partially performed under the BSA; (3) rescission was not possible; (4) the settlement documents complied with the BSA; and (5) Lee had no good cause to not execute them. The Arbitrator’s Decision ordered Lee to execute the settlement documents, but again, she did not. Thereafter, Rosen requested this court to dismiss the first appeal and enforce the BSA.  We denied that request, abated the first appeal, and ordered that Rosen seek enforcement of the BSA in a separate proceeding.^[1]

            In November 1999, Rosen sued to confirm the award of the arbitrator and filed a breach of contract action to enforce the BSA.  Rosen subsequently filed a Motion for Summary Judgment and Motion to Confirm Arbitration Award.  In response to these motions, Lee moved to vacate the arbitration award. The trial court confirmed the arbitration award on March 6, 2000.  Without specifying the grounds, the trial court granted Rosen’s motion for summary judgment and entered a final judgment on the next day, March 7, 2000.  After the trial court denied Lee’s motion for new trial, this appeal ensued.

Issues Presented

            Lee challenges the various steps of the process leading to the trial court’s confirmation of the arbitration award following the signing of the BSA, its granting of Rosen’s motion for summary judgment and its ordering Lee to sign the further settlement documents called for in the BSA.  Specifically, Lee contends: (1) the BSA is voidable because Rosen failed to comply with the BSA and the mediator was not impartial; (2) the trial court erred in granting Rosen’s motion for summary judgment and in signing the Final Judgment reflecting that action; and (3) the trial court erred in confirming the arbitration award.

I.

Standard of Review

            A defendant moving for “traditional” summary judgment has the burden of establishing that no genuine issue of material fact exists as to one or more essential elements of the plaintiff’s cause of action and that the defendant is entitled to judgment as a matter of law.  Nardini v. Cont’l Airlines, Inc, 60 S.W.3d 197, 200 (Tex. App.—Houston [14th Dist.] 2001, pet. denied) (citing Nixon v. Mr. Prop.  Mgmt. Co., 690 S.W.2d 546, 548–49 (Tex. 1985)).  If the defendant meets this burden, the plaintiff must then raise a genuine issue of material fact on the targeted element of the plaintiff’s cause of action.  Gonzalez v. City of Harlingen, 814 S.W.2d 109, 112 (Tex. App.—Corpus Christi 1991, writ denied).  In reviewing a summary judgment, an appellate court accepts as true all evidence supporting the non-movant.  Nixon, 690 S.W.2d at 549.  A reviewing court also indulges all inferences in favor of the non-movant, and likewise resolves all doubts in his favor.  Id.  Where the trial court does not state the grounds for granting the motion, and several grounds are provided, the reviewing court must affirm the summary judgment if any of the theories advanced are meritorious.  Rogers v. Ricane Enters., Inc., 772 S.W.2d 76, 79 (Tex. 1989).  Finally, because the propriety of summary judgment is a question of law, we review the trial court’s decision de novo.  Natividad v. Alexsis, Inc., 875 S.W.2d 695, 699 (Tex. 1994).

II.

Was The BSA Voidable?

            Before we address Lee’s other issues, we will address the question of whether the settlement agreement executed by Lee and Rosen at the appellate mediation is voidable.  This issue arises because Lee failed to execute the further settlement documents, the arbitrator in the subsequent arbitration required Lee to execute the documents, but Lee still refused to do so.  Accordingly, Rosen filed a suit for breach of contract, and later a motion for summary judgment, and Lee responded.  Specifically, Lee responded with an affidavit in which she stated she had signed the BSA that required delivery of further settlement documents to her by June 8, 1999, but those documents were not delivered until June 11, 1999.  Her affidavit, the only affidavit submitted by Lee as part of her summary judgment proof, does not contain any allegations her signature on the BSA was procured by fraud, mistake or duress. 

            The Restatement of Contracts, § 7 Provides: “A voidable contract is one where one or more parties have the power, by a manifestation of election to do so, to avoid the legal relations created by the contract, or by ratification of the contract to extinguish the power of avoidance.”  Restatement (second) of contracts § 7 (1981).  Comment b to § 7 addresses grounds of avoidance, in part as follows: “Typical instances of voidable contracts are those where the contract was induced by fraud, mistake, or duress, or where breach of a warranty or other promise justifies the aggrieved party in putting an end to the contract.” Restatement (second) of contracts § 7 cmt. b (1981).  Because Lee did not raise the issues of fraud, mistake, or duress in her summary judgment proof, she cannot present those issues on appeal.  See Tex. R. Civ. P. 166a(c) (stating issues not expressly presented to the trial court by written motion, answer or other response shall not be considered on appeal as grounds for reversal). 

            Lee’s primary support for her contention the BSA is voidable is her complaint regarding the three day delay in receiving the further settlement documents.  She also contends the mediator was not impartial.  Neither of these arguments, however, can be used to support Lee’s position on appeal.

            Section 154.071(a) of the Civil Practice and Remedies Code provides:  “If the parties reach a settlement and execute a written agreement disposing of the dispute, the agreement is enforceable in the same manner as any other written contract.”  Tex. Civ. Prac. & Rem. Code § 154.071(a) (Vernon 1997).  Thus, a mediated settlement agreement is like any other contract and is enforceable under contract law.  Martin v. Black, 909 S.W.2d 192, 195 (Tex. App.—Houston [14th Dist.] 1995, writ denied).

            The intent of the parties to be bound is, however, an essential element of an enforceable contract.  Hardman v. Dault, 2 S.W.3d 378, 380 (Tex. App.—San Antonio 1999, no pet.).  Here the intent of the parties to be bound is clear.  The language in the BSA requiring the delivery of “any further settlement documents to the other parties” by June 9 is not prefaced by the words “subject to.”  The “further settlement documents” clause neither states nor implies the parties intended that the BSA was to be subject to any subsequent action by the parties, or that the signing of documents was to be a condition precedent to the formation of an enforceable contract.  Id. at 181.  Accordingly, since the BSA contains all essential terms, and no fact issues exist concerning whether the parties intended the BSA to be binding, we hold the BSA is, as a matter of law, an enforceable, non-voidable contract.

            Lee also challenges the BSA on the ground the mediator was not impartial. This issue was not raised by Lee in her response to Rosen’s motion for summary judgment requesting confirmation of the arbitration award requiring Lee to sign the further settlement documents finalizing the BSA.  Under Civil Procedure Rule 166a(c), Lee has waived that complaint on appeal, and it cannot be used on appeal to challenge the enforceability of the BSA.

            Finally, without raising this as a point of error, Lee generally complains she was not represented by counsel at the mediation, in contravention of the rules pertaining to appellate mediation provided by this court.  At the time of the mediation, the rules provided the mediator would only serve in cases in which the parties are represented by attorneys. While this might be a legitimate challenge in this case, Lee failed to preserve this issue by presenting it to the trial court as part of her summary judgment proof.  Under Civil Procedure Rule 166(a) she has waived this complaint on appeal as a basis of her challenge to the BSA.  We overrule all of Lee’s challenges to the validity of the BSA, and hold the BSA is a contract enforceable against Lee.

III.

Did the Trial Court Err in Granting the Motion For Summary Judgment?

            Rosen’s motion for summary judgment was simply based on her petition to enforce the BSA.  That petition (1) alleged Lee breached the BSA by failing to execute and return the further settlement documents in accordance with paragraph five of the BSA, and (2) requested enforcement of that agreement and confirmation of the arbitration award.  The trial court granted the summary judgment in favor of Rosen on March 7, 2000, ordering Lee to comply with the BSA and the arbitration award by executing the settlement documents.^[2]  We have held the BSA was an enforceable contract, not voidable by Lee.  Accordingly, we hold the trial court did not err in granting the summary judgment and enforcing the BSA.  Further, Lee’s second challenge to trial court’s summary judgment, that the trial court erred in signing the Final Judgment granting the summary judgment, merely duplicates her challenge to the order granting the summary judgment.  Because the trial court did not err in granting the summary judgment, a fortiori it was not error to “sign” that judgment. We overrule Lee’s challenge to the order granting summary judgment.

IV.

Did the Trial Court Err in Confirming the Arbitration Award?

            While difficult to discern, it appears Lee’s complaint regarding the arbitration award is that the arbitrator was not an impartial third party, and Lee was ambushed. That complaint has been waived under the Texas Arbitration Act (TAA).

            A.  Does the Texas Arbitration Act Apply?

            The BSA, which contains the arbitration agreement, states the BSA shall be performable in Harris County, Texas, and shall be construed in accordance with the laws of the State of Texas.  We hold this language subjects the arbitration provision in the BSA to Texas law.  Lee’s argument the BSA is voidable is the issue that was arbitrated.  A claim that a contract is voidable is not a claim precluded from arbitration under § 171.002 of the TAA.  See Tex. Civ. Prac. & Rem. Code § 171.002 (Vernon Supp. 2002) (specifying those matters outside the scope of Chapter 171, General Arbitration, of the Civil Practice and Remedies Code).  Lee has not challenged the application of the TAA here, nor has she contended the Federal Arbitration Act should be applied.  The TAA applies to Lee’s claims regarding the arbitration.

            B.  Analysis

            Section 171.087 of the Texas Arbitration Act provides as follows: “Unless grounds are offered for vacating, modifying, or correcting an award under Section 171.088 or 171.091, the court, on application of a party, shall confirm the award.”  Tex. Civ. Prac. & Rem. Code § 171.087 (Vernon Supp. 2002) (emphasis added).  Section 171.088 is entitled “Vacating Award,” and describes certain circumstances which permit a trial court to vacate an award, including evident partiality by an arbitrator appointed as a neutral arbitrator, and misconduct or wilful misbehavior of an arbitrator.  See Tex. Civ. Prac. & Rem. Code § 171.088(a) (Vernon Supp. 2002).  That section requires, however, a party to make application to vacate an award “not later than the 90th day after the date of delivery of a copy of the award to the applicant.”  Id. at 171.088(b).  If the award was obtained by corruption, fraud, or other undue means, a party must make an application to vacate the award not later than the 90th day after the date the grounds are known or should have been known.  Id.

            Similarly, section 171.091, entitled “Modifying or Correcting Award,” permits the trial court to modify or correct an arbitration award where certain showings are made by the applicant for that relief.  See Tex. Civ. Prac. & Rem. Code § 171.091(a) (Vernon Supp. 2002).  Section (b) states “[a] party must make an application under this section not later than the 90th day after the date of delivery of a copy of the award to the applicant.”  Id. at 171.091(b).

            Lee states in her opening and reply briefs that she received a bill from, and decision of, arbitrator on July 14, 1999.  Lee failed to submit either an application to vacate the award or to modify the award within ninety days after the date of delivery of a copy of the award to her. Indeed, the first time Lee made any objection to the arbitration award in the trial court was in her response to Rosen’s motions for summary judgment and to confirm the arbitration award. Lee’s response, seeking vacation of the award, was filed February 18, 2000, more than seven months – and significantly more than ninety days – after she received a copy of the arbitration award.  The complaint made in Lee’s response to the motion to confirm award was that the arbitrator was not an impartial third party and she was ambushed, the same as her complaint on appeal. 

            The ninety day requirement in § 171.088 has been referred to as a limitations period.  See Louisiana Natural Gas Pipeline, Inc., v. Bludworth Bond Shipyard, Inc., 875 S.W.2d 458, 462 (Tex. App.—Houston [1st Dist.] 1994, writ denied).  After the limitations period has expired, a party cannot ask a court to vacate an arbitration award.  Id.  Because Lee did not present this complaint to the trial court within ninety days of her receipt of the arbitration award, Lee has waived, and we overrule, all of her complaints about the award.

CONCLUSION

            Lee’s appeal is from the 234th District Court of Harris County’s order to enforce the Binding Settlement Agreement Lee freely and voluntarily signed following a mediation ordered by this Court.  We have addressed all of the issues we can divine from her two appellate briefs, and have overruled them. Accordingly, we affirm the March 7, 2000 Final Judgment and the March 6, 2000 Order Confirming Arbitration Award.

                                                                        /s/        John S. Anderson

                                                                                    Justice

Judgment rendered and Opinion filed August 22, 2002.

Panel consists of Justices Anderson, Hudson, and Seymore.

Do Not Publish — Tex. R. App. P. 47.3(b).

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            ^[1]  Rosen sought enforcement of the BSA in the 234th District Court of Harris County. When Lee appealed to this court the final judgment signed by the trial court on March 7, 2000, we assigned a new docket number to it—No. 14-00-00759-CV.  The first appeal, still in abatement, was ordered dismissed by the March 7, 2000 Final Judgment signed by judge of the 234th District Court.

            ^[2]  As explained in note one above, the March 7, 2000 Final Judgment also ordered Lee to dismiss her appeal.  The appeal referenced is Lee’s original appeal in this court’s cause No. 14-99-00120-CV.