New Hampshire Insurance Company v. Magellan Reinsurance Company, Ltd. , 2013 Tex. App. LEXIS 5437 ( 2013 )


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  •                           COURT OF APPEALS
    SECOND DISTRICT OF TEXAS
    FORT WORTH
    NO. 02-12-00196-CV
    NEW HAMPSHIRE INSURANCE                                             APPELLANT
    COMPANY
    V.
    MAGELLAN REINSURANCE                                                     APPELLEE
    COMPANY, LTD.
    ----------
    FROM THE 236TH DISTRICT COURT OF TARRANT COUNTY
    ----------
    OPINION ON REHEARING
    ----------
    Appellant New Hampshire Insurance Company filed a motion for rehearing
    of our opinion issued February 14, 2013. We deny the motion, withdraw our
    opinion and judgment dated February 14, 2013, and substitute the following.
    I. INTRODUCTION
    The   litigation   between    New     Hampshire   and   Appellee    Magellan
    Reinsurance Company, Ltd. has been lengthy, vigorously contested, and well
    traveled. It began in 2004 in the Turks and Caicos Islands (TCI), included brief
    proceedings in New York, and is now—eight years later, yet still in its infancy—
    ongoing in Texas. While the essence of the underlying dispute between New
    Hampshire and Magellan has remained unchanged since the inception of the
    litigation, New Hampshire‘s opinion about the arbitrability of the disputed matters
    has not.   Because we hold that New Hampshire is judicially estopped from
    compelling arbitration, we will affirm the trial court‘s order denying New
    Hampshire‘s motion to compel arbitration.
    II. FACTUAL AND PROCEDURAL BACKGROUND
    New Hampshire is a Pennsylvania corporation that is authorized to
    conduct business in Texas. Magellan is a corporation chartered in the TCI. Its
    primary place of business is Tarrant County, Texas.
    In 1997, New Hampshire and Magellan entered into a ―Contractual
    Reimbursement Insurance Reinsurance Agreement,‖ whereby Magellan agreed
    to accept 100% of New Hampshire‘s obligations and liabilities under a number of
    automobile dealer insurance policies issued by New Hampshire in exchange for
    100% of the gross written premiums paid under the policies, less a provisional
    ceding commission to New Hampshire. The Reinsurance Agreement required
    Magellan to establish a trust account, from which New Hampshire was
    authorized to withdraw funds to secure payments under the Reinsurance
    Agreement. The Reinsurance Agreement also contains an arbitration provision,
    which provides in relevant part that ―[a]ll disputes or differences arising out of the
    2
    interpretation of this Agreement shall be submitted‖ to arbitration in New York.
    [Emphasis added.]
    In April 2002, New Hampshire made ―a series of withdrawals‖ from the
    trust account—over $2 million according to Magellan—―effectively emptying‖ it.
    New Hampshire subsequently informed Magellan that the trust fund required a
    deposit of approximately $1.2 million. Magellan identified several discrepancies
    in New Hampshire‘s claims handling and accounting, disagreed that the deposit
    was necessary, and requested a refund from New Hampshire in the amount of
    approximately $995,000. New Hampshire and Magellan continued to exchange
    correspondence over the next few years—New Hampshire defended its claims
    handling and accounting and demanded that Magellan deposit approximately
    $1.4 million into the trust account, and Magellan challenged New Hampshire‘s
    claims amounts, demanded to inspect New Hampshire‘s books and records, and
    refused to deposit the $1.4 million into the trust account.
    Relying upon the demanded but unpaid $1.4 million and a TCI ordinance
    related to a company‘s inability to pay a ―debt,‖ New Hampshire filed a petition in
    August 2004 in a TCI court to ―wind up‖ Magellan‘s business.             Magellan
    responded by moving to stay the proceedings and to compel arbitration. New
    Hampshire argued against arbitration, contending that the dispute did not involve
    the interpretation of the Reinsurance Agreement but only whether Magellan was
    insolvent. The TCI lower court agreed with New Hampshire, declined to compel
    3
    arbitration, and ordered Magellan to be wound up. An appeal reversing the lower
    court, a remand, and additional litigation in the TCI courts ensued.
    Meanwhile, at some point before the TCI lower court issued its final ruling,
    Magellan initiated a proceeding in a New York state court to enjoin the TCI
    litigation and to compel New Hampshire to arbitration in New York.           New
    Hampshire contested the action, arguing that Magellan‘s ―statutory insolvency‖
    under TCI law was not a dispute that involved the interpretation of the
    Reinsurance Agreement. After the TCI lower court had ruled, the New York court
    denied Magellan‘s requested relief, concluding—just like the TCI lower court
    had—that ―[t]he question of whether [Magellan] owes money is not an
    interpretation of the reinsurance contract; rather, it is a factual controversy
    concerning respondent‘s calculation of the amount in dispute . . . .‖
    In September 2005, while the TCI litigation was still pending, Magellan
    sued New Hampshire in Texas and asked the trial court to make nine
    declarations regarding the parties‘ rights ―under the Reinsurance Agreement.‖
    Magellan amended its original petition later in September 2005, and with the
    exception of two declarations, Magellan asked the trial court to make all of the
    same declarations as those pleaded in the original petition.
    In December 2005, New Hampshire filed a motion to dismiss or abate
    Magellan‘s Texas action. New Hampshire argued that the relief was necessary
    because ―[t]he issues Magellan now asks this Court to decide mirror those
    4
    raised, litigated[,] and currently pending in the TCI . . . Action.‖ The trial court
    abated the Texas action in February 2006 pending resolution of the TCI litigation.
    The TCI litigation came to a conclusion in July 2009 when the Lords of the
    Judicial Committee of the Privy Council held that New Hampshire was not a
    ―creditor‖ of Magellan and, therefore, could not ―wind up‖ Magellan‘s business.
    Two years later, in June 2011, the Texas trial court purported to vacate the order
    abating the case.
    In November 2011, New Hampshire, for the first time, moved to compel
    arbitration of Magellan‘s then-pleaded declaratory judgment claims.            New
    Hampshire argued that arbitration was necessary because Magellan had
    repeatedly admitted as much in earlier proceedings. Detailing New Hampshire‘s
    history of contesting arbitration, Magellan responded that judicial estoppel,
    judicial admission, collateral estoppel, and waiver barred New Hampshire from
    compelling arbitration of Magellan‘s claims.      In December 2011, before the
    hearing on New Hampshire‘s motion, Magellan filed its second amended petition,
    removing its nine requests for declaratory relief and substituting claims against
    New Hampshire for breach of contract, fraud, breach of fiduciary duty,
    conversion, accounting, and theft under the Texas Theft Liability Act. The trial
    court ultimately denied New Hampshire‘s motion to compel arbitration.          This
    interlocutory appeal followed.
    5
    III. PRIOR DISMISSAL FOR WANT OF PROSECUTION
    Neither party raises any jurisdictional arguments, but we feel compelled to
    first address a procedural matter that was partly the subject of a recent original
    proceeding in this court. On December 30, 2009, the Texas trial court dismissed
    for want of prosecution Magellan‘s lawsuit against New Hampshire.            Almost
    fifteen months later, on March 17, 2011, the trial court vacated its December 30,
    2009 dismissal order and reinstated the cause. New Hampshire later filed a
    petition for writ of mandamus, arguing that the trial court lacked plenary power to
    reinstate the cause. See In re New Hampshire Ins. Co., No. 02-12-00281-CV,
    
    2012 WL 3264392
    , at *1 (Tex. App.—Fort Worth Aug. 13, 2012, orig. proceeding
    [mand. denied]) (mem. op.).         This court agreed with New Hampshire
    (notwithstanding that the cause had been abated when the trial court dismissed
    it) and conditionally granted the petition. 
    Id. at *1–2.
    Although our holding meant
    that the cause was not reinstated in March 2011, Magellan later invoked the
    Texas trial court‘s subject-matter jurisdiction by filing the second amended
    petition in December 2011.      See Leach v. Brown, 
    156 Tex. 66
    , 68–69, 
    292 S.W.2d 329
    , 330–31 (1956) (holding that the filing of an amended petition in the
    same cause in which a final judgment had already been entered was, like an
    original petition, sufficient to invoke the trial court‘s jurisdiction). We therefore
    6
    observe no jurisdictional impediment to our consideration of this interlocutory
    appeal.1
    IV. ARBITRABILITY OF MAGELLAN’S CLAIMS
    In what we construe as a single issue, New Hampshire argues that the trial
    court erred by refusing to compel arbitration of the claims pleaded by Magellan in
    its second amended petition. Specifically, New Hampshire contends that the
    claims involve the interpretation of the Reinsurance Agreement, that it did not
    waive the right to arbitrate any of the claims, and that none of the other equitable
    principles cited by Magellan prevent enforcement of the arbitration provision
    because the pending claims are separate and distinct from the matters involved
    in the TCI and New York litigation.
    Magellan responds that its fraud, breach of fiduciary duty, conversion,
    theft, and accounting claims are outside the scope of the arbitration clause
    because, on their face, they do not involve the interpretation of the Reinsurance
    Agreement.    Further, although Magellan does not dispute that its breach of
    contract claim is within the scope of the arbitration agreement, it argues that its
    former requests for declaratory relief ―essentially morphed‖ into the breach of
    1
    This court has also previously issued a memorandum opinion addressing
    New Hampshire‘s arguments that Magellan failed to comply with the
    requirements for recognition of foreign country judgments under the Uniform
    Foreign Country Money-Judgment Recognition Act. See New Hampshire Ins.
    Co. v. Magellan Reins. Co., No. 02-11-00334-CV, 
    2013 WL 105654
    , at *1 (Tex.
    App.—Fort Worth Jan. 10, 2013, no pet.) (mem. op.). Nothing in that opinion
    conflicts with our holding in this memorandum opinion.
    7
    contract claim and that New Hampshire‘s request to compel arbitration of the
    breach of contract claim is barred by judicial estoppel, judicial admission,
    collateral estoppel, and waiver because of New Hampshire‘s prior conduct
    contesting arbitration in the TCI litigation, the New York proceeding, and the pre-
    second amended petition Texas litigation. To the extent that the non-breach of
    contract claims are covered by the arbitration agreement, Magellan argues that
    they too are barred on the same grounds.
    New Hampshire replies that its past arguments contesting arbitration are
    irrelevant and cannot preclude it from compelling arbitration at this point because
    the second amended petition alleges entirely new causes of action, the
    arbitrability of which New Hampshire has never argued against.
    A.    Standard of Review
    We review the trial court‘s denial of a motion to compel arbitration for an
    abuse of discretion. See In re Labatt Food Svc., L.P., 
    279 S.W.3d 640
    , 643 (Tex.
    2009) (orig. proceeding); Cleveland Constr., Inc. v. Levco Constr., Inc., 
    359 S.W.3d 843
    , 851–52 (Tex. App.—Houston [1st Dist.] 2012, pet. dism‘d)
    (explaining standards of review for arbitration appeals). Under this standard, we
    defer to the trial court‘s factual determinations that are supported by the record
    and review legal questions de novo. Cleveland Constr., 
    Inc., 359 S.W.3d at 851
    –
    52.
    8
    B.     Choice of Law
    The Reinsurance Agreement states that it ―shall be governed by and
    construed in accordance with the laws of the State of New York.‖ Although New
    Hampshire observes that the Reinsurance Agreement is governed by New York
    law and cites a number of New York cases in its briefing, it predominantly relies
    on Texas caselaw and has confirmed on several occasions that there is no
    relevant distinction between Texas and New York law. ―As there appears to be
    no conflict of laws, ‗there can be no harm in applying Texas law.‘‖              In re
    AdvancePCS Health L.P., 
    172 S.W.3d 603
    , 606 (Tex. 2005) (orig. proceeding)
    (quoting Compaq Computer Corp. v. Lapray, 
    135 S.W.3d 657
    , 672 (Tex. 2004));
    Aldridge v. Thrift Fin. Mktg., LLC, 
    376 S.W.3d 877
    , 882 (Tex. App.—Fort Worth
    2012, no pet.) (reasoning similarly). We therefore apply Texas law.
    C.     Magellan’s Non-Breach of Contract Claims
    A party attempting to compel arbitration must establish a valid arbitration
    agreement whose scope includes the claims asserted.2             In re Dillard Dep’t
    Stores, Inc., 
    186 S.W.3d 514
    , 515 (Tex. 2006) (orig. proceeding). In determining
    whether a claim falls within the scope of an arbitration agreement, we focus on
    the factual allegations of the complaint, rather than the legal causes of action
    asserted. See Jack B. Anglin Co. v. Tipps, 
    842 S.W.2d 266
    , 271 (Tex. 1992).
    Any doubts about whether Magellan‘s non-breach of contract claims fall within
    2
    Whether the Federal Arbitration Act (FAA), Texas Arbitration Act, or both
    apply is not at issue in this appeal, nor does it affect our analysis or jurisdiction.
    9
    the scope of the arbitration agreement must be resolved in favor of arbitration.
    Prudential Sec. Inc. v. Marshall, 
    909 S.W.2d 896
    , 899 (Tex. 1995). The policy in
    favor of enforcing arbitration agreements is so compelling that a court should not
    deny arbitration unless it can be said with positive assurance that an arbitration
    clause is not susceptible of an interpretation that would cover the dispute at
    issue.    
    Id. If a
    party establishes a valid arbitration agreement whose scope
    includes the claims asserted, the burden shifts to the party opposing arbitration to
    prove its defenses to arbitration. AdvancePCS Health, 
    L.P., 172 S.W.3d at 607
    .
    Here, there is no dispute that a valid arbitration agreement exists. As for
    whether Magellan‘s non-breach of contract claims are subject to arbitration, the
    fraud claim complains of ―words, acts, [and] conducts [by New Hampshire] . . .
    which were false.‖       The breach of fiduciary duty claim alleges that New
    Hampshire ―acted in its own best interest and contrary to the interest of
    Magellan.‖ The conversion claim alleges that in withdrawing trust funds, New
    Hampshire ―converted property which belonged to Magellan.‖ The theft claim
    alleges that New Hampshire ―unlawfully appropriated or stole the funds contained
    in the trust account.‖ And the accounting claim alleges that New Hampshire
    ―should be required to render a full and complete detailed accounting of all claims
    and monies paid.‖ Thus, to some extent, each of Magellan‘s claims implicates
    New Hampshire‘s duties and responsibilities under the Reinsurance Agreement.
    We therefore cannot conclude with positive assurance that Magellan‘s non-
    breach of contract claims do not require—or at a minimum, touch upon in some
    10
    way—the interpretation of the Reinsurance Agreement. See, e.g., In re FirstMerit
    Bank, N.A., 
    52 S.W.3d 749
    , 754–56 (Tex. 2001) (compelling arbitration of tort
    claims related to financing contract); Jack B. Anglin 
    Co., 842 S.W.2d at 271
    (―Although the City‘s misrepresentation claims are grounded in legal theory
    distinct from its contract claim, they are factually intertwined, and thus are subject
    to the arbitration provision of the contract.‖); Hou-Scape, Inc. v. Lloyd, 
    945 S.W.2d 202
    , 205–06 (Tex. App.—Houston [1st Dist.] 1997, orig. proceeding)
    (holding that tort claims were arbitrable because they arose out of and were
    related to contract). We hold that Magellan‘s fraud, breach of fiduciary duty,
    conversion, theft, and accounting claims are within the scope of the arbitration
    agreement.
    D.     Magellan’s Defense to Arbitration: Judicial Estoppel
    Magellan argues that even if all of its claims are subject to arbitration, New
    Hampshire is judicially estopped from compelling arbitration of those claims. We
    agree.
    The doctrine of judicial estoppel precludes a party who successfully
    maintains a position in one proceeding from afterwards adopting a clearly
    inconsistent position in another proceeding to obtain an unfair advantage.
    Ferguson v. Bldg. Materials Corp. of Am., 
    295 S.W.3d 642
    , 643 (Tex. 2009);
    Pleasant Glade Assembly of God v. Schubert, 
    264 S.W.3d 1
    , 6 (Tex. 2008), cert.
    denied, 
    555 U.S. 1137
    (2009). It is not intended to punish inadvertent omissions
    or inconsistencies but rather to prevent parties from playing fast and loose with
    11
    the judicial system for their own benefit. 
    Ferguson, 295 S.W.3d at 643
    . As one
    court has observed, the doctrine‘s purpose is ―to prohibit the deliberate shifting of
    position to suit exigencies of each particular case that may arise concerning the
    subject matter in controversy.‖ Moore v. Neff, 
    629 S.W.2d 827
    , 829 (Tex. App.—
    Houston [14th Dist.] 1982, writ ref‘d n.r.e.).
    The record demonstrates that Magellan first raised the issue of arbitration
    at the outset of the TCI litigation, when it sought to stay those proceedings. New
    Hampshire argued against arbitration and described the dispute as regarding the
    ―calculation of sums owing,‖ which according to New Hampshire, did not involve
    the interpretation of the Reinsurance Agreement. The TCI lower court agreed
    with New Hampshire and denied Magellan‘s request to stay the proceedings for
    arbitration.   Thus, in successfully defending against arbitration in the TCI
    litigation, New Hampshire convinced the TCI lower court that the scope of the
    proceedings there did not involve any interpretation of the Reinsurance
    Agreement.
    Magellan raised the issue of arbitration again in the New York proceeding
    when it sought to enjoin the TCI proceedings.        As in the TCI litigation, New
    Hampshire argued against arbitration, describing its petition in the TCI action as
    one that was ―not based upon a dispute regarding the interpretation of the
    Reinsurance Agreement‖ and explaining that ―Magellan‘s statutory insolvency
    under‖ TCI law did not involve the interpretation of the Reinsurance Agreement.
    The New York court declined to stray from the reasoning of the TCI lower court‘s
    12
    order denying arbitration and, like the TCI lower court, adopted New Hampshire‘s
    narrow interpretation of the proceedings, concluding that ―[t]he question of
    whether petitioner owes money is not an interpretation of the‖ Reinsurance
    Agreement.
    In September 2005, as the TCI litigation progressed, Magellan initiated the
    Texas action and sought nine declarations regarding the parties‘ rights ―under the
    Reinsurance Agreement.‖ Notwithstanding Magellan‘s unambiguous reference
    explaining its intent in seeking the declarations (to determine rights ―under the
    Reinsurance Agreement‖), even the most cursory review of the nine declarations
    reveals that each indisputably required an interpretation of the Reinsurance
    Agreement; they stated,
    a.     Whether [New Hampshire] validly withdrew funds from the
    trust and whether [New Hampshire] is obligated to refund
    amounts previously withdrawn in error from the trust and the
    amount of such refund, including interest;
    b.     Whether the Reinsurance Agreement allows a deduction for
    ―timing differences‖;
    c.     Whether [New Hampshire] can withdraw amounts from the
    Trust without providing supporting detailed claims
    documentation that supports the amounts withdrawn;
    d.     Whether [New Hampshire] has sole discretion to summarily
    determine the amount of unearned premium reserves
    pursuant to Article IV of the Reinsurance Agreement;
    e.     the detail required in the cession statements under Article VII
    of the Reinsurance Agreement;
    f.     Magellan‘s right to audit [New Hampshire‘s] books and
    records under Article XI of the Reinsurance Agreement; and
    13
    whether, under Article XI of the Reinsurance Agreement,
    Magellan sufficiently disputed the amount [New Hampshire]
    claims is owing to the Trust;
    g.    the identity of dealers and/or contracts covered by the
    Reinsurance Agreement;
    h.    whether, under Article XI of the Reinsurance Agreement,
    Magellan‘s request to audit [New Hampshire‘s] books and
    records can be conditioned on Magellan depositing the
    amount requested by [New Hampshire] into the Trust, and
    vice versa; and
    i.    the correct and valid amount of the reinsurance claims, if any,
    by [New Hampshire] against Magellan.
    Although New Hampshire had successfully argued against arbitration by narrowly
    defining both the purpose and scope of the proceedings as involving only a
    determination of the amount of money owed by Magellan to New Hampshire,
    when it sought to dismiss or abate Magellan‘s Texas lawsuit, it argued that ―[t]he
    issues Magellan now asks this Court to decide [which obviously involved an
    interpretation of the Reinsurance Agreement] mirror those raised, litigated[,] and
    currently pending in the TCI . . . Action.‖   [Emphasis added.]     Indeed, New
    Hampshire successfully argued,
    The central issue in the TCI lawsuit is whether Magellan should be
    wound up for its failure to adequately fund a trust account pursuant
    to the terms of a reinsurance agreement between the parties.
    Though that precise issue is not presented to this Court in
    Magellan‘s request for declaratory judgment, all issues presented
    are part and parcel of that determination and all concern the amount
    of Magellan‘s debt to [New Hampshire], an issue that will be
    addressed by the liquidator appointed in the TCI Action. Because all
    issues in this subsequently-filed action may be, or currently are, in
    litigation in the TCI lawsuit, this Court should dismiss Magellan‘s
    request for declaratory judgment. [Emphasis added.]
    14
    Thus, in seeking to dismiss or abate the Texas action, New Hampshire‘s
    interpretation of the scope of the TCI litigation shifted from its earlier narrow
    description of the proceedings as merely involving a determination of the amount
    of money owed by Magellan to broadly construing the proceedings to include all
    of Magellan‘s declarations seeking to interpret multiple parts of the Reinsurance
    Agreement. Notwithstanding this, and perhaps intending to quash any further
    attempts by Magellan to compel arbitration in light of New Hampshire‘s amended
    perception of the scope of the proceedings there, New Hampshire stated in a
    footnote in its motion to dismiss or abate that it ―denies that there is a dispute
    ‗arising out of interpretation of the Reinsurance Agreement,‘‖ a statement that
    irreconcilably conflicted with its arguments broadly construing the scope of the
    TCI litigation. New Hampshire subsequently prevailed, just as it had in the TCI
    lower court and the New York litigation.
    Several years later, after the TCI litigation had concluded, New Hampshire
    moved to compel arbitration of Magellan‘s claims, which at the time were those
    included in Magellan‘s first amended petition—the nine declarations. According
    to New Hampshire, ―a valid arbitration agreement exists that is in writing,
    encompasses the subject matter of the dispute, involves transactions in interstate
    commerce, and therefore requires arbitration under the FAA.‖ Although Magellan
    quickly filed its second amended petition, removing the declaration requests and
    15
    substituting them with its current claims, New Hampshire‘s intent was clear: it
    now wanted to arbitrate Magellan‘s claims.
    The foregoing portions of the record thus show that, regarding the scope of
    the TCI and New York litigation as it pertained to the propriety of compelling
    arbitration, New Hampshire, to its benefit, maintained a position in the TCI lower
    court and the New York proceeding that was inconsistent with its position in the
    Texas action. Now, a number of years later, New Hampshire is attempting to
    accomplish a similar feat; it successfully argued against arbitration of Magellan‘s
    claims in the TCI litigation and the New York proceeding but now wants to
    compel arbitration. The unfair advantage that New Hampshire stands to gain
    simply consists of the fruits of shifting position to suit the exigencies of each
    particular cause. See 
    Ferguson, 295 S.W.3d at 643
    ; 
    Moore, 629 S.W.2d at 829
    .
    This is the precise conduct that judicial estoppel is meant to prohibit.
    New Hampshire argues on rehearing that judicial estoppel is inapplicable
    because the doctrine does not apply to contradictory positions taken in the same
    proceeding. See Pleasant Glade Assembly of 
    God, 264 S.W.3d at 6
    , 8. It states
    that ―[n]either the Court nor Magellan contends that [New Hampshire‘s] motion to
    compel arbitration is inconsistent with [New Hampshire‘s] position in the TCI and
    New York courts. The only alleged inconsistencies are the statements from [New
    Hampshire‘s] motion to dismiss or abate.‖          New Hampshire misreads our
    analysis. We do not rely upon any inconsistency between the motion to dismiss
    or abate and the motion to compel arbitration in the Texas action to support our
    16
    conclusion that New Hampshire is judicially estopped from compelling arbitration.
    Our conclusion applying judicial estoppel rests upon the inconsistencies between
    New Hampshire‘s motion to compel arbitration in the Texas proceeding and its
    arguments and contentions in the TCI and New York proceedings contesting
    arbitration. Pleasant Glade Assembly of God is therefore inapposite.
    New Hampshire argues that its prior conduct contesting arbitration is
    irrelevant because it has never argued that the claims alleged by Magellan in its
    second amended petition are not arbitrable.      According to New Hampshire,
    ―Magellan identifies no case law or other authority . . . holding that an alleged
    waiver or estoppel of a party‘s right to arbitration applies to a later-amended
    complaint alleging entirely new causes of action.‖ This is a compelling argument,
    but it is ultimately unpersuasive because it relies upon a hypertechnical
    perspective of the proceedings that is inconsistent with the reality of what this
    dispute has always been, and continues to be, about—both parties‘ rights and
    duties and compliance or noncompliance with one or more terms of the
    Reinsurance Agreement.
    When Magellan filed its original petition in the Texas action, it attached
    correspondence between it and New Hampshire dating as far back as 2002.
    Even at this early stage of the dispute, it was apparent that the disagreements
    between the parties involved their respective rights and duties under the
    Reinsurance Agreement—New Hampshire defended its claims handling and
    accounting and demanded that Magellan deposit funds into the trust account,
    17
    and Magellan challenged New Hampshire‘s claims amounts, demanded to
    inspect New Hampshire‘s books and records, and refused to deposit additional
    funds into the trust account. The correspondence abounds with references to the
    Reinsurance Agreement.
    In the TCI litigation, New Hampshire convinced the TCI lower court that
    arbitration was unnecessary because the dispute involved only the calculation of
    money owed by Magellan, an exclusively non-interpretive, factual matter. But the
    record belies this overly narrow characterization; the dispute involved much more
    than a simple debt, and Magellan tried to explain this in the TCI litigation. Philip
    Apgar‘s affidavit, which Magellan appears to have filed as part of its first appeal
    of the lower court‘s order requiring Magellan‘s business to be wound up,
    illuminated the extent of the dispute between the parties, stating,
    It is apparent that there are significant differences between the
    parties. They are in effect of at least two types.
    (1)    First there are issues regarding the principles on which [New
    Hampshire] has produced its Cession Statements and the
    appropriate sums that ought to be included within them.
    These include questions regarding the extent of [New
    Hampshire‘s] discretion to charge its costs against premiums
    and to determine the level of unearned premium reserve.
    (2)    Secondly, there is the question of whether under the
    Reinsurance Agreement the parties intended that Magellan,
    when faced with a payment demand which could only be
    validated by an audit of the Petitioner‘s records under Art XI,
    would in effect be barred from challenging that demand unless
    it had exercised its audit right within two calendar quarters of
    service of the demand by the Petitioner.
    ....
    18
    I am advised that [the] winding up procedure ought not to be
    used for claims other than genuinely undisputed debts and claims
    where, though there is a dispute, the dispute can be shown easily
    and quickly to be not genuine in the sense of being groundless. I
    would submit that it is apparent from what I say above that here
    there is a real dispute which is still unresolved after months of
    detailed argument by myself and, on [New Hampshire‘s] behalf, Ms.
    Cheshire.
    It is moreover a dispute of a type which the parties have
    agreed should be dealt with by arbitration and which is particularly
    suitable for arbitration.
    And particularly telling is the judgment of the Lords of the Judicial
    Committee of the Privy Council. Even though the limited issue before the high
    court concerned New Hampshire‘s status as a ―creditor,‖ the judgment includes
    approximately five single-spaced pages of excerpts from the Reinsurance
    Agreement.       Given that New Hampshire‘s and Magellan‘s relationship is
    governed by the Reinsurance Agreement, it is no surprise that the high court
    chose to begin its analysis by extensively referencing the Reinsurance
    Agreement‘s terms.
    In   the   New   York   proceeding,   New   Hampshire   persisted   in   its
    characterization of the dispute as one not involving the interpretation of the
    Reinsurance Agreement, but in doing so, it simultaneously observed that the
    dispute involved Magellan‘s failure to deposit funds into a trust account ―as
    required by the Reinsurance Agreement.‖ [Emphasis added.] Thus, even when
    narrowly characterizing the scope of the dispute before the New York court, New
    19
    Hampshire could not escape the significance of the Reinsurance Agreement as it
    pertained to New Hampshire‘s relationship and dispute with Magellan.
    And finally, although Magellan has amended its petition several times, its
    claims in the Texas litigation—whatever label they have been given—have
    consistently implicated an interpretation of the terms of the Reinsurance
    Agreement. Cf. Jack B. Anglin 
    Co., 842 S.W.2d at 271
    (reasoning that we focus
    on the factual allegations of the complaint, rather than the legal causes of action
    asserted, when determining whether claim falls within the scope of an arbitration
    agreement).
    A thorough review of the record thus reveals this: Neither New
    Hampshire‘s varying characterizations of the proceedings nor the labels attached
    to the claims alleged by Magellan in its petitions define the essence of the
    dispute between New Hampshire and Magellan.             The dispute has always
    centered around, and continues to entail, each party‘s rights and duties and
    compliance or noncompliance under the Reinsurance Agreement. On more than
    one occasion, in one form or another, New Hampshire has argued against the
    arbitrability of this dispute. Its conduct has been overwhelmingly inconsistent
    with its present attempt to compel arbitration.
    New Hampshire argues on rehearing that we should not rely upon its
    conduct in the TCI litigation to support a determination of judicial estoppel
    because to do so requires, erroneously, a broad construction of the arbitration
    provision. But reliance on New Hampshire‘s conduct in the TCI litigation does
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    not require us to broadly construe the arbitration provision—or to even construe it
    at all. As our analysis demonstrates, we merely review numerous documents
    evidencing years of litigation—a unique perspective unavailable to the other
    courts—to conclude that the claims asserted by Magellan in its second amended
    petition involve facts and issues that are no different than the issues contested by
    the parties in the other forums.
    Accordingly, in light of all the foregoing, we cannot agree with New
    Hampshire‘s overriding argument that it has never challenged the arbitrability of
    the claims alleged by Magellan in its second amended petition.
    We hold that New Hampshire is judicially estopped from compelling
    arbitration and, therefore, that the trial court did not abuse its discretion by
    denying New Hampshire‘s motion to compel arbitration.           We overrule New
    Hampshire‘s sole issue.
    V. CONCLUSION
    Having overruled New Hampshire‘s only issue, we affirm the trial court‘s
    order denying New Hampshire‘s motion to compel arbitration.
    BILL MEIER
    JUSTICE
    PANEL: GARDNER, MCCOY, and MEIER, JJ.
    DELIVERED: May 2, 2013
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