ConocoPhillips Company v. Tonia Graham and Mindy Dicus ( 2012 )

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Opinion issued March 29, 2012.



In The

Court of Appeals

For The

First District of Texas

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NO. 01-11-00503-CV

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ConocoPhillips Company, Appellant

V.

Tonia Graham and Mindy Dicus, Appellee

On Appeal from the 157th District Court

Harris County, Texas

Trial Court Case No. 1060385

MEMORANDUM OPINION

          This is an interlocutory appeal from the trial court’s order denying ConocoPhillips Company’s motion to compel arbitration. In its sole issue, ConocoPhillips contends that it is a third-party beneficiary entitled to enforce arbitration agreements between its contractor and the contractor’s employees in this suit brought by the employees against it for injuries allegedly sustained while providing services at its refinery. We hold that ConocoPhillips is a third-party beneficiary entitled to enforce the arbitration agreements and that the employees’ claims fall within the agreements’ scope. We therefore reverse the trial court’s order and remand to the trial court with instruction to compel arbitration of Graham and Dicus’s claims against ConocoPhillips.

Background

          ConocoPhillips operates a petroleum refinery in Borger, Texas. It hired J.V. Industrial Companies, Ltd. (JVIC) to perform fabrication work at the refinery. The relationship between ConocoPhillips and JVIC is governed by a master services agreement. Under the agreement, ConocoPhillips and JVIC agree to indemnify each other for certain claims. Among them, JVIC agrees to indemnify ConocoPhillips for claims filed against it by JVIC employees, up to a maximum of $10 million per occurrence. This agreement also contains an arbitration agreement covering certain claims between ConocoPhillips and JVIC. It further assigns JVIC sole responsibility for the “work safety” of its employees, requiring that JVIC perform routine safety inspections and adopt and train its employees in safety procedures.

JVIC also has arbitration agreements with its employees, including Tonia Graham and Mindy Dicus.Graham and Dicus each signed an “Arbitration Agreement/Policy,” in which they agreed to arbitrate certain claims “[a]s a condition for reviewing your application for employment and/or as a condition of employment with [JVIC] . . . .” In these agreements, JVIC and Graham or Dicus agreed to “submit any claim covered by [the] agreement to binding arbitration” and that such arbitration will be “the sole and exclusive remedy for resolving” such claims or disputes. The agreement covers:

all claims and/or disputes between and among all Applicants/ Employees and JVIC, and all disputes between and among Applicants/Employees and JVIC’s subcontractors, contractors, clients, vendors, facility owners where Applicant/Employee performs services for JVIC, and each of their subsidiaries, affiliates, parents, employees, agents, and any other person or entity who has signed this or a similar agreement or otherwise agreed to use arbitration to settle claims or disputes that may arise, including, by way of example, disputes arising from or concerning: . . .

(5) Any other claim for personal, emotional, physical, or economic injury.

The only disputes which are not included within this mutual agreement to arbitrate are:

(1)       Claims by Applicant/Employee for workers’ compensation or unemployment compensation benefits . . .

(2)       Claims against Applicant/Employee for injunctive relief . . . .

(emphasis in original).

Graham and Dicus were working for JVIC at ConocoPhillips’s Borger facility when a steam header ruptured, causing ConocoPhillips to evacuate the refinery. Graham and Dicusassert that they were injured during the evacuation. When Graham and Dicus sued ConocoPhillips, JVIC assumed ConocoPhillips’s defense and agreed to indemnify ConocoPhillips pursuant to the master service agreement. ConocoPhillips then moved to compel arbitration of Graham and Dicus’s claims against it on the ground that it is a third-party beneficiary to their arbitration agreements with JVIC. Graham and Dicus contested ConocoPhillips’s right to enforce their arbitration agreements with JVIC. The trial court denied the motion to compel arbitration, which ConocoPhillips appeals.

Standard of Review and Burdens of Proof

          The arbitration agreements signed by Graham and Dicus expressly invoke the Federal Arbitration Agreement.[1]See In re Rubiola, 334 S.W.3d 220, 223 (Tex. 2011)(orig. proceeding) (stating that parties may expressly agree to arbitrate under FAA); In re Kellogg Brown & Root, 80 S.W.3d 611, 617 (Tex. App.—Houston [1st Dist.] 2002, orig. proceeding) (holding that when parties expressly agree to arbitrate under FAA, they are not required to demonstrate transaction involving or affecting interstate commerce). Under the FAA, a party may apply for an order compelling arbitration of claims governed by a valid arbitration agreement. Id.; 9 U.S.C. § 4 (West 2008). An order denying such a motion to compel arbitration is reviewable by interlocutory appeal. Tex. Civ. Prac. & Rem. Code Ann.§ 51.016 (West Supp. 2011); 9 U.S.C. § 16(a)(1)(B); see In re Merrill Lynch & Co., Inc., 315 S.W.3d 888, 891 n.3 (Tex. 2010) (orig. proceeding).

A party seeking to compel arbitration under the FAA must establish (1) the existence of a valid, enforceable arbitration agreement and (2) that the claims at issue fall within that agreement’s scope. In re Kellogg Brown & Root, Inc., 166 S.W.3d 732, 737 (Tex.2005) (orig. proceeding); In re Provine, 312 S.W.3d 824, 828 (Tex. App.—Houston [1st Dist.] 2009)(orig. proceeding).If the movant establishes that an arbitration agreement governs the dispute, the burden shifts to the party opposing arbitration to establish a defense to the arbitration agreement. In re Provine, 312 S.W.3d at 829 (citing In re Oakwood Mobile Homes, Inc., 987 S.W.2d 571, 573 (Tex.1999) (orig. proceeding)). Once the arbitration movant establishes a valid arbitration agreement that encompasses the claims at issue, a trial court has no discretion to deny the motion to compel arbitration unless the opposing partyproves a defense to arbitration. Id. (quoting In re FirstMerit Bank, N.A., 52 S.W.3d 749, 753–54 (Tex. 2001)(orig. proceeding)). Because state and federal policies favor arbitration, courts must resolve any doubts about an arbitration agreement’s scope in favor of arbitration.In re FirstMerit Bank, N.A., 52 S.W.3d at 753.

Generally, we review a trial court’s decision to grant or deny a motion to compel arbitration under an abuse of discretion standard. Okorafor v. Uncle Sam & Assocs., Inc., 295 S.W.3d 27, 38 (Tex. App.—Houston [1st Dist.] 2009, pet. denied). Under this standard, we defer to a trial court’s factual determinations if they are supported by evidence, but we review a trial court’s legal determinations de novo. In re Labatt Food Serv., L.P., 279 S.W.3d 640, 643 (Tex. 2009) (orig. proceeding); see also In re D. Wilson Constr. Co., 196 S.W.3d 774, 780 (Tex. 2006) (orig. proceeding). Whether a valid arbitration agreement exists and whether the arbitration agreement is ambiguous are questions of law that we review de novo. In re D. Wilson Constr., 196 S.W.3d at 781. The primary issue here is whether ConocoPhillips, which is not a party to Graham and Discus’s arbitration agreements, may enforce those agreements against them. Whether a non-signatory can compel arbitration pursuant to an arbitration agreement is an issue that goes to the existence of a valid arbitration agreement between parties; we will therefore review that determination de novo. See In re Rubiola, 334 S.W.3d at 224; In re Weekley Homes, L.P., 180 S.W.3d 127, 130 (Tex. 2005)(orig. proceeding).

Valid, Enforceable Arbitration Agreements

Under the FAA, state contract law governs issues of validity, revocability, and enforceability of an arbitration agreement. Arthur Andersen L.L.P. v. Carlisle, 556 U.S. 624, 129 S. Ct. 1896, 1902 (2009); see also In re Rubiola, 334 S.W.3d at 224. Thus, ConocoPhillips is entitled to enforce Graham’s and Dicus’s arbitration agreements as a third-party beneficiary if it qualifies as such under Texas contract law. See Arthur Andersen, 129 S. Ct. at 1902. Texas courts of appeals have issued several recent opinions applying the third-party beneficiary analysis in the context of enforcement of an arbitration agreement. We begin this analysis by reviewing these cases, which shed light on the outcome here.

A.      Pertinent case law

Graham and Dicus rely heavily on this Court’s rejection of an attempt to enforce an arbitration clause by a purported third-party beneficiary in In re Bayer Materialscience, L.L.C., 265 S.W.3d 452, 454–56 (Tex. App.—Houston [1st Dist.] 2007) (orig. proceeding). Bayer is factually similar to this case in many ways. Like this case, employees of an independent contractor, Brock, sued a plant owner, Bayer, to recover for injuries sustained at the plant. Id. at 454. Also like this case, there was an arbitration agreement between the plaintiffs-employees and their employer, Brock. Bayer moved to compel arbitration, contending that it was a third-party beneficiary to the employees’ arbitration agreements. Id. The arbitration agreements contained language similar, but not identical, to that at issue here. They required the employees to arbitrate:

each, every, any and all claims, disputes or controversies between or among [the employee and employer], and also between or among all other persons named, described, referred to and/or stated anywhere in this agreement. Those claims, disputes and controversies shall include, but are not limited to, . . . all claims, disputes and controversies with or against [the employer’s] customers, clients and/or any other person(s) under contract with [the employer], including . . . the owner(s) of any and all property upon which and/or with which [the employee] may or has performed any work or services for or on behalf of any person.

Id.

It was undisputed that Bayer was a “customer” of Brock and was also the owner of the property where the accident occurred. Id. at 456. But this language, alone, was not sufficient to “confer upon Bayer a thirdparty contract right of enforcement” against the employees. Id. Noting that Bayer had to overcome the legal presumption that a party is presumed to contract only for its own benefit and that neither Bayer’s duty to the employees nor the employees’ remedy against Bayer arose out of their contracts with Brock, we held Bayer was not a third-party beneficiary to the arbitration agreements. Id. at 457–58.

ConocoPhillips relies heavily on a decision from the Beaumont Court of Appeals in which the court, a few months after Bayer, faced a similar fact patternbut reached a different result. In re Citgo Petro. Corp., 248 S.W.3d 769 (Tex. App.—Beaumont 2008, orig. proceeding). Similar to thiscase, an employee of a contractor sued the property owner, Citgo, forinjuries suffered on the job at a refinery. Id.at 763.The contractor, Pat Tank, and its employee had entered into an arbitration agreement similar to the one at issue in Bayer and here. Id. The agreement obligated the parties to arbitrate “all claims or disputes between and among Employee, [the contractor], and [the contractor’s] customer[s], and clients . . . and any other person or entity that has signed this or [a] similar agreement or otherwise agreed to use mediation and/or arbitration to settle any claims or disputes that may arise between them.” Id. at 773−74. Like Bayer, Citgo was a client of the contractor-employer, Pat Tank. Id. at 774.

In holding that Citgo was an intended third-party beneficiary to Pat Tank’s contract with its employee, the Beaumont court distinguished Bayeron the basis of Pat Tank’s indemnity obligation to Citgo. Id. at 776–777. Unlike in Bayer, the record in Citgo contained Pat Tank’s contract with Citgo, which required it to indemnify Citgo for damages, including arbitrator’s fees, arising out of claims filed by its employees against Citgo. Id. at 777. The court observed that Pat Tank’s contractual obligation to indemnify Citgo “suggests one reason Pat Tank would intend to give Citgo the right to enforce the arbitration agreement between Pat Tank and [its employee]” because the employee’s claim “may ultimately, though indirectly, be paid by Pat Tank under the indemnity contract.” Id. The court concluded that these circumstances indicated “an intent to give Citgo the benefit of [the employee’s] promise to arbitrate.” Id.

The Citgo court held that another party, Stoneburner, was not a third-party beneficiary to Pat Tank’s arbitration agreement with its employee. Although Stoneburner contended that it was a “vendor” under the agreement, it produced no other evidence regarding the parties’ intent to confer a benefit upon it. The court observed, “The fact that the dispute resolution agreement includes non-signatory vendors within its sweep does not, without more, demonstrate Stoneburner’s status as an intended third-party beneficiary.” Id. (citing Bayer, 265 S.W.3d at 457–58).Thus, like Bayer, the court found that a generic description of a type of party covered by the employee’s arbitration agreement with his employer did not, standing alone, conferthird-party beneficiary status on the party that fell within that description.

          ConocoPhillips also relies on a post-Bayer decisionby the Texas Supreme Court in which it held that a party was entitled to enforce another party’s arbitration agreement with the claimant as a third-party beneficiary. See In re NEXT Fin. Grp., 271 S.W.3d 263, 267 (Tex. 2008) (orig. proceeding). In NEXT Financial, a securities brokerage firm sought to enforce an arbitration agreement between its employee and the National Association of Securities Dealers (NASD). Id. at 265. In his agreement with the NASD, the employee agreed to “arbitrate any dispute, claim or controversy that may arise between me and my firm . . . that is required to be arbitrated under the rules, constitutions, or bylaws of [the NASD.]” Id. Without further discussion, the Texas Supreme Court held that the brokerage firm was “a clearly intended” third-party beneficiary of the employee’s agreement with the NASD and could “compel arbitration in accordance with the terms of that agreement, even though NEXT is not a signatory to [it].” Id. at 267 (citing In re Prudential Ins. Co. of Am. Sales Practice Litig., 133 F.3d 225, 230 (3rd Cir. 1998)) (holding that employer was intended third-party beneficiary of NASD arbitration agreement); cf. In re Palm Harbor Homes, Inc., 195 S.W.3d 672, 677 (Tex. 2006) (orig. proceeding) (holding that intended third-party beneficiary of arbitration agreement could compel arbitration)).

The Third Circuit case cited by the Texas Supreme Court in NEXTFinancial held that the NASD’s arbitration agreement and rules established certain classes of individuals, including member brokerage firms, who would benefit from brokers’ arbitration agreements with the NASD, and that requiring the agreements to specifically identify all intended third-party beneficiaries, known and unknown, would frustrate the agreements’ purpose. In re Prudential Ins., 133 F.3d at 230.

B.      ConocoPhillips’s right to compel arbitration

We begin, as we did in Bayer, by recognizing that the law favors arbitration once the existence of a valid arbitration agreement has been established but does not presume the existence and validity of such an agreement. See 265 S.W.3d at 455–56 (“If [an agreement to arbitrate] exists, then the law favors enforcing it. But the law favoring arbitration does not go so far as to create an obligation to arbitrate where none exists.”); see also Ellis v. Schlimmer, 337 S.W.3d 860, 862 (Tex. 2011) (observing that presumption arises after valid arbitration agreement is established and applies to issues unrelated to agreement’s validity); In re Poly-Am., L.P., 262 S.W.3d 337, 348 (Tex. 2008) (rejecting assertion that presumption favoring arbitration applies to assessment of whether parties entered into enforceable arbitration agreement). ConocoPhillips must establish that it has a right to enforce Graham’s and Dicus’s arbitration agreements before it may enjoy the strong presumption in favor of arbitration. See Ellis, 337 S.W.3d at 862.

Under Texas law, an entity that is not a party to a contract may nevertheless enforce the contract as a third-party beneficiary if it establishes that (1) the parties to the contract intended to secure a benefit to it and (2) entered into the contract directly for its benefit. In re Palm Harbor Homes, 195 S.W.3d at 677. While the contract need not have been executed solely for the benefit of the third-party, the benefit to the third-party must be more than merely incidental to the contract. City of Houston v. Williams, 353 S.W.3d 128, 146 (Tex. 2011). In determining whether the parties intended to benefit a third-party, courts look to the entire agreement, giving effect to all of its provisions. Id.

The presumption is that parties contracted only for themselves; to overcome this presumption, a third-party must make a clear showing that the parties to the contract intended otherwise. Id.; see also Bayer, 265 S.W.3d at 456 (stating that because party is presumed to contract only for its own benefit, claimant had to overcome legal presumption that it was not third-party beneficiary). But a clear showing of intent to benefit a third-party does not require the phrase “third-party beneficiary” or any other magic words. City of Houston, 353 S.W.3d at 146. Nor must a third-party beneficiary be expressly identified by name in the agreement. See Energy Serv. Co. of Bowie, Inc. v. Superior Snubbing Servs., Inc., 236 S.W.3d 190, 195 (Tex. 2007). A third-party beneficiary may be identified in the agreement by class or category of persons, all of whom may not be known to the contracting parties at the time of execution. See In re NEXT Fin.Grp., 271 S.W.3d at 267; see also In re Prudential Ins., 133 F.3d at 230.

We hold that ConocoPhillips is a third-party beneficiary to JVIC’s arbitration agreements with Graham and Dicus for three reasons: (1) this construction gives meaning to all of the contracts’ arbitration language, which differs from the contract language in Bayer; (2) the presumption that parties contract for their own benefit does not have its typical impact under the circumstances of this case; and (3) arbitration of Graham’s and Dicus’s claims against ConocoPhillips is essential, rather than incidental, to JVIC’s enjoyment of the full benefit of its contractual arbitration rights.

1.       The contract language

In Bayer, the contractor’s arbitration agreement with its employee required the employee to arbitrate certain claims “between or among [the employee and his employer], and also between or among all other persons named, described, referred to and/or stated anywhere in this agreement.”265 S.W.3d at 454. JVIC’s contracts with Graham and Dicus use slightly different language, requiring arbitration of all claims or disputes “between or among [Graham or Dicus] and JVIC” and all disputes “between or among [Graham or Dicus] and JVIC’s . . . clients . . . facility owners where [Graham or Dicus] perform[] services for JVIC . . . .” Thus, these agreements put claims into two categories: (1) claims between Graham or Dicus and JVIC, and (2) claims between Graham or Dicus and various categories of third parties. This is distinguishable from the language in Bayer, which was broad enough to include claims between employees and third parties and not the employer but did not separately provide for arbitration of such claims. The second category of claims indentified in Graham’s and Dicus’s arbitration agreements expressly mandates arbitration of disputes in which JVIC is not a party; that obligation to arbitrate such claims has no affect if it cannot be enforced by a third-party. This language is therefore some indication that JVIC intended for clients like ConocoPhillips to have the right to enforce the arbitration agreements. See City of Houston, 353 S.W.3d at 146 (requiring courts to give effect to all of arbitration’s provisions in determining whether parties intended to benefitthird-party).

2.       Presumption against third-party beneficiaries

As the Bayer court observed, “a party is presumed to contract only for its own benefit[.]”265 S.W.3d at 456; see MCI Telecomm. Corp. v. Tex. Util. Elec. Co., 995 S.W.2d 647, 652 (Tex. 1999). For this reason, contract law presumes that parties to a contract did not intend to confer a benefit on third parties. See MCI Telecomm., 995 S.W.2d at 652. But this presumption has less force when, as here, the contractual rights relate to dispute resolution of specific claims, as to which a contracting party owes a duty of indemnification and defense to the third-party claiming the benefit. JVIC entered into the master service agreement in January 2008. Graham and Dicus signed JVIC’s “Arbitration Agreement/Policy” in 2009 and 2010, respectively. In light of its indemnity and defense obligations to ConocoPhillips, JVIC, by conferring a right to enforce these arbitration agreements on ConocoPhillips, benefitted itself.

The Citgo court identified a similar indemnity obligation as the basis for determining that the contractor in that case intended to endow Citgo with a right to enforce the contractor’s arbitration agreement with its employee.See 248 S.W.3d at 777. In Bayer, the record established no indemnity relationship between Bayer and its scaffolding contractor. See 265 S.W.3d at 454. In this aspect, the case before us is more akin to Citgothan Bayer.[2]

Also, unlike Bayer, the master service agreement imposed certain duties on JVIC to protect the safety of its employees while providing services at ConocoPhillips’s facility. Thus, JVIC, on the one hand, assumed certain duties to ConocoPhillips regarding its employees’ work safety and, on the other hand, benefitted itself by providing for arbitration if one of its employees was injured on the job and asserted claims against ConocoPhillips that fell within its indemnity obligation.

3.       Intended v. incidental benefit

In light of the contracts’ express contemplation of an arbitration obligation in disputes to which JVIC is not a party, and in light of JVIC’s interest in having such claims arbitrated as an indemnitor, the benefit conferred on ConocoPhillips—the right to enforce JVIC’s arbitration agreements when sued by JVIC’s employees—is not merely incidental. Cf. MCI Telecomm., 995 S.W.2d at 651 (third-party whose transmission lines were incidentally affected by performance of fiber optic cable installation contract was not third-party beneficiary of contract).ConocoPhillips’s right to enforce the arbitration agreements is necessary to effectuate one of JVIC’s apparent intended purposes in entering into the agreement: arbitration of not only the employee’s claims against JVIC but also the employee’s claims against JVIC’s clients, whom JVIC has, at least in some cases, agreed to indemnify and defend in such matters. See Citgo,248 S.W.3d at 777.

          For all of these reasons, we conclude that ConocoPhillips is a third-party beneficiary under JVIC’s arbitration agreements with Graham and Dicus.[3]

Scope

Having determined that ConocoPhillips is a third-party beneficiary to JVIC’s arbitration agreements with Graham and Dicus, ConocoPhillips is now entitled to the strong presumption that Graham and Dicus’s claims are subject to arbitration. Ellis, 337 S.W.3d at 862 (observing that “strong presumption favoring arbitration” arises once party seeking to arbitrate proves existence of valid arbitration agreement). We resolve any doubts as to whether Graham’s and Dicus’s claims fall within the scope of the agreement in favor of arbitration. Id. (stating that courts should “resolve any doubts as to the agreement’s scope”).

The arbitration agreements expressly include any claim for “personal” or “physical” injury between a JVIC employee and JVIC client. In their petition, Graham and Dicus assert that they suffered “injuries to their body and hearing” and “also suffered from stress associated with reliving the incident.” These are “personal” and “physical” injuries. ConocoPhillips is a JVIC client. Not only were the arbitration agreements broadly worded, they explicitly state that the “only disputes which are not included within” their scope are certain claims relating to workers’ compensation or unemployment compensation and certain claims for injunctive relief. See Pepe Intern. Dev. Co. v. Pub Brewing Co., 915 S.W.2d 925, 930 (Tex. App.—Houston [1st Dist.] 1996, no writ) (stating rule that broadly worded arbitration provisions evidence parties’ intent to be inclusive, rather than exclusive, of claims covered under provision). Graham’s and Dicus’s claims are neither for injunctive relief nor workers’ or unemployment compensation. Thus, Graham’s and Dicus’s claims fall within the scope of claims covered by the plain language of the arbitration agreements.

Graham and Dicus assert that their claims in this lawsuit are outside of the scope of those agreements because: their claims arise out of ConocoPhillips’s general tort duty and not any rights founded on their employment relationship with JVIC; when they sustained their injuries, they were “fleeing from an explosion” rather than performing work; and their claims are “not the product of any commercial transaction, as is required for applicability of the FAA.” In support of their position, Graham and Dicus rely on 9 U.S.C. § 2 and In re NEXT Financial, 271 S.W.3d at 266–67. Section two of the FAA provides: “A written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction, or the refusal to perform the whole or any part thereof . . . shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for revocation of any contract.” 9 U.S.C. § 2. The language Graham and Dicus rely on from NEXT Financial is: “Under the FAA’s plain language, an arbitrable dispute can arise out of either the contract containing the arbitration clause or a transaction evidence by the contract.” 271 S.W.3d at 266 (emphasis added by appellees).

JVIC’s arbitration agreements with Graham and Dicus are “contract[s] evidencing a transaction involving commerce.” See 9 U.S.C. § 2. They state that they are entered into as a condition of JVIC’s employment of Graham and Dicus. And Graham’s and Dicus’s claims arise out of their employment with JVIC. Graham and Dicus specifically pled that they were “working at” ConocoPhillips’s refinery when the steam header ruptured and that they were there as “invitees.” Their premises liability claims against ConocoPhillips are, in fact, dependent on their invitee status. Graham and Dicus have identified no right to be on ConocoPhillips’s premises except as employees of JVIC performing work there.

In the very paragraph of the NEXT Financial opinion from which Graham and Dicus quote, the Supreme Court goes on to recognize that it “has held that tort claims and other extra-contractual claims can arise from a commercial transaction and may be subject to arbitration agreements made under the FAA.” In re NEXT Fin., 271 S.W.3d at 267. Texas courts routinely enforce employee-employer arbitration agreements under the FAA with respect to claims based on personal injuries allegedly suffered by an employee while on the job. E.g.,J.B. Hunt Transp., Inc. v. Hartman, 307 S.W.3d 804(Tex. App.—San Antonio 2010, no pet.); Nexion Health at Omaha, Inc. v. Martin, 2010 WL 2690562, at *8(Tex. App.—Texarkana July 7, 2010, no pet.) (mem. op.); In re Permian Tank & Mfg., Inc., 306 S.W.3d 338, 341 (Tex. App.—Eastland 2010, orig. proceeding). We see no reason to treat Graham’s and Dicus’s claims differently merely because they were evacuating the work site at the time the injury occurred, and they have provided us no authority suggesting that we do so.

We hold that Graham’s and Dicus’s claims against ConocoPhillips are within the scope of their arbitration agreements.

Conclusion

          We hold that the trial court erred in refusing to compel arbitration of Graham’s and Dicus’s claims against ConocoPhillips. Accordingly, we reverse the trial court’s order and remand with an instruction to the trial court to grant ConocoPhillips’s motion to compel arbitration of these claims and to take such other actions as it deems appropriate and consistent with this opinion.

                                                                   Harvey Brown

                                                                   Justice

Panel consists of Justices Jennings, Sharp, and Brown.

Justice Sharp, dissenting. Dissent to follow.

[1]           The arbitration agreement provides that the FAA governs first but state law will apply in the event that the FAA is not applicable, “so as to give this agreement the broadest application possible.” Neither party has argued that this provision should be read as requiring the application of the Texas Arbitration Act here. Graham and Dicus state in their brief that, because they were “fleeing from an explosion” rather than “working” at the time of their injuries, their claims are “not the product of any commercial transaction, as is required for the applicability of the FAA.” But this is part of an their argument as to whether their claims are within the scope of the arbitration agreement. They do not assert that the FAA does not govern the dispute if the claims are within the scope of the arbitration agreement.

[2]           Graham and Dicus point out that the indemnification agreement between Citgo and the contractor, Pat Tank, in Citgo expressly referenced “arbitrator’s fees” among Citgo’s indemnifiable costs, while the indemnification agreement between ConocoPhillips and JVIC expressly reference “court costs” among ConocoPhillips’sindemnifiable costs. While the reference to arbitration costs in the indemnity agreement in Citgo was probative of Pat Tank’s intent in that case, 248 S.W.3d at 777, we do not find the absence of such reference determinative here. JVIC’s indemnity obligations to ConocoPhillips under the master service agreement extended beyond claims by JVIC employees to include claims by persons with whom JVIC may not have had an arbitration agreement, such as its invitees, subcontractors, employees or invitees of subcontractors, and the agents, representatives, or assigns of their invitees and subcontractors. Additionally, the record does not establish whether JVIC had arbitration agreements with all of its employees at the time it executed the master service agreement. While Graham had a previous arbitration agreement with JVIC, the only arbitration agreement between Dicus and JVIC was executed in 2010.

[3]           At oral argument, Graham and Dicus stated that they are not requesting that we affirm the trial court’s ruling on the basis that their claims do not fall within the scope of the arbitration agreement. Nevertheless, because they raised and argued this issue in their briefing, we address it below.