author: Justice LANG.

text:
    In re STHRAN, Relator.
    No. 05-10-01176-CV.
    Court of Appeals of Texas, Dallas.
    Oct. 29, 2010.

      Steven E. Couch, Kelly, Sutter & Kendrick, PC, Houston, TX, Eric H. Marye, The Marye Firm, Dallas, TX, for Relator.
    Lori D. Proctor, Savrina R. Karels, Johnson, Trent, West & Taylor, L.L.P., Houston, for Real Party in Interest.
    Before Justices MOSELEY, LANG, and MYERS.
   OPINION

Opinion By

Justice LANG.

In this original proceeding, relator Etta Sthran seeks a writ of mandamus ordering the trial court to vacate the portion of its March 29, 2010 “Order Granting in Part Motion to Compel Arbitration and Motion to Dismiss or Stay” that orders arbitration of relator’s individual claims against real party in interest “Forest Lane Healthcare Center and THI of Texas at Forest Lane, LLC” (“Forest Lane”). For the reasons below, we conclude (1) the trial court abused its discretion by ordering relator’s individual claims to arbitration because the arbitration clause at issue is not in compli-anee with state law, which is applicable here, and (2) relator has no adequate remedy by appeal. We conditionally grant the writ of mandamus.

I. FACTUAL AND PROCEDURAL BACKGROUND

On February 13, 2004, relator’s husband, Sam Sthran Jr. (“Mr. Sthran”), was admitted to Forest Lane for nursing care. At that time, relator signed Forest Lane’s “Admission Contract” (the “contract”) on a signature line labeled “Fiduciary Party (if any)” (emphasis original). The contract was not signed by Mr. Sthran. The contract contained, inter alia, the following provision:

Pursuant to the Federal Arbitration Act, any action, dispute, claim, or controversy of any kind (e.g., whether in contract or in tort, statutory or common law, legal or equitable, or otherwise) now existing or hereafter arising between the parties in any way arising out of, pertaining to or in connection with the provision of healthcare services, any agreement between the parties, the provision of any other goods or services by [Forest Lane] or other transactions, contracts or agreements of any kind whatsoever, any past, present or future incidents, omissions, acts, errors, practices, or occurrence causing injury to either party whereby the other party or its agents, employees or representatives may be liable, in whole or in part, or any other aspect of the past, present, or future relationships between the parties shall be resolved by binding arbitration administered by the National Health Lawyers Association (the “NHLA”).

Following Mr. Sthran’s death in 2008, relator, individually and as surviving spouse and .representative of Mr. Sthran, filed suit against Forest Lane on December 3, 2009. In her petition, relator alleged in relevant part that “negligent acts and omissions” of Forest Lane caused damages to Mr. Sthran during his lifetime and also were a proximate cause of his death. Relator claimed damages pursuant to the “Texas Wrongful Death Statute” and the “Texas Survival Statute.”

Forest Lane responded with an answer and general denial on December 30, 2009. In its answer, Forest Lane asserted as an affirmative defense that “the disputes at issue in this lawsuit are governed by a valid and enforceable arbitration agreement.” On January 25, 2010, Forest Lane filed a motion to compel arbitration and dismiss, or, in the alternative, stay proceedings. In that motion, Forest Lane asserted, in part, “Since Plaintiffs’ claims are covered by the Arbitration Agreement executed by Etta Sthran, Defendant requests that the Court enforce the agreement and compel arbitration in accordance with the Federal Arbitration Act (“FAA”) and dismiss, or, in the alternative, stay this lawsuit pending the arbitration.”

Relator filed a response to Forest Lane’s motion on March 15, 2010. In that response, relator contended Forest Lane’s motion should be denied for two independent reasons: (1) because Forest Lane has “failed to prove-up” relator’s legal authority to make healthcare and legal decisions for Mr. Sthran “such that she could waive a jury trial and agree to arbitrate all disputes on his behalf,” the arbitration provision in the contract is unenforceable and (2) the arbitration provision fails to satisfy the notice requirements of Texas Civil Practice and Remedies Code section 74.451, which addresses agreements to arbitrate health care liability claims. See Tex. Civ. PRAC. & Rem.Code Ann. § 74.451 (West 2005). Further, relator asserted that if Forest Lane contends section 74.451 is preempted by the FAA, the McCarren-Ferguson Act (“MFA”) “reverse preempts the FAA.” Relator argued

Specifically, the MFA prohibits the federal preemption of any state law which was/is enacted for the purpose of regulating insurance and Texas courts have held that Chapter 74 and Section 74.451 (and its predecessor Article 4590i) were enacted for the purpose of regulating insurance and as such, cannot be preempted by federal law. Therefore, Section 74.451 cannot be preempted by the FAA and because the arbitration provision does not meet the Section 74.451 notice requirements, the provision cannot be enforced.

(emphasis original).

On March 18, 2010, Forest Lane filed a reply in which it asserted, inter alia, that “[t]he Texas Supreme Court has held that the lack of compliance with a Texas statute, i e. the failure to comply with Chapter 74 of the Texas Civil Practice and Remedies Code, does not invalidate an arbitration agreement governed by the FAA because preemption exists.” Additionally, Forest Lane contended the arbitration agreement is valid and enforceable because relator either (1) signed the arbitration agreement on behalf of her husband, or (2) signed the arbitration agreement in her individual capacity.

Following a hearing, the trial court signed an “Order Granting in Part Motion to Compel Arbitration and Motion to Dismiss or Stay” dated March 29, 2010. The trial court stated in relevant part in that order

Claims being brought by Plaintiff Etta Sthran for her individual damages and not derivative of the claims of Sam Sthran or of his estate of [sic] are, accordingly, ORDERED to arbitration (pursuant to the terms of the Admission Contract/Arbitration Agreement executed on February 13, 2004, between Forest Lane and Etta Sthran); AND prosecution of said claims in this case are STAYED pending the conclusion of arbitration.
Any additional relief requested in the Motion not herein granted is hereby Denied.

(emphasis original). This mandamus proceeding followed.

II. RELATOR’S ENTITLEMENT TO MANDAMUS RELIEF

A. Applicable Law

Mandamus will issue if the relator establishes a clear abuse of discretion for which there is no adequate remedy by appeal. In re Odyssey Healthcare, Inc., 310 S.W.3d 419, 422 (Tex.2010) (orig.proceeding); In re Deere & Co., 299 S.W.3d 819, 820 (Tex.2009) (orig.proceeding); In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135-36 (Tex.2004) (orig.proceeding). A trial court abuses its discretion if it reaches a decision so arbitrary and unreasonable as to amount to a clear and prejudicial error of law or if it clearly fails to correctly analyze or apply the law. In re Cerberus Capital Mgmt., L.P., 164 S.W.3d 379, 382 (Tex.2005) (orig.proceeding); In re Tex. Am. Express, Inc., 190 S.W.3d 720, 723 (Tex.App.-Dallas 2005, orig. proceeding). A trial court has no discretion in determining what the law is or applying the law to the facts. Walker v. Packer, 827 S.W.2d 883, 840 (Tex.1992) (orig.proceeding). Thus a clear failure by the trial court to analyze or apply the law correctly will constitute an abuse of discretion, and may result in appellate reversal by extraordinary writ. Id.; see also In re Tex. Am. Express, 190 S.W.3d at 724.

“There is no definitive list of when an appeal will be ‘adequate,’ as it depends on a careful balance of the case-specific benefits and detriments of delaying or interrupting a particular proceeding.” In re Gulf Exploration, LLC, 289 S.W.3d 836, 842 (Tex.2009) (orig.proceeding); see also In re McAllen Med. Ctr., Inc., 275 S.W.3d 458, 468 (Tex.2008) (orig.proceeding) (“[T]he adequacy of an appeal depends on the facts involved in each case”). With respect to mandamus review of orders compelling arbitration, the supreme court has stated that “the balance will generally tilt toward reviewing orders compelling arbitration only on final appeal.” In re Gulf Exploration, LLC, 289 S.W.3d at 843. However, the court has further stated

In those rare cases when legislative mandates conflict, mandamus “may be essential to preserve important substantive and procedural rights from impairment or loss, [and] allow the appellate courts to give needed and helpful direction to the law that would otherwise prove elusive in appeals from final judgments.”

Id. (quoting In re Prudential Ins. Co., 148 S.W.3d at 136).

B. Analysis

1. Enforceability of Arbitration Provision

In the first of her three issues, relator contends the arbitration provision in the contract is unenforceable because it fails to satisfy the mandatory notice requirement of Texas Civil Practice and Remedies Code section 74.451. See Tex. Civ. Prac. & Rem.Code Ann. § 74.451. Relator asserts the notice requirement of section 74.451 applies because the MFA “reverse preempts” the FAA. Consequently, relator argues, the trial court abused its discretion by ordering relator’s individual claims to arbitration.

Forest Lane argues the FAA applies in this case for two reasons: (1) the parties’ relationship involves interstate commerce and (2) the “arbitration agreement” signed by relator invokes the FAA. According to Forest Lane, the FAA preempts the notice requirements of Chapter 74, thereby creating a valid and enforceable arbitration agreement between relator and Forest Lane. Forest Lane contends “the MFA does not reverse preempt the FAA because Chapter 74 of the Texas Civil Practice & Remedies Code was not enacted for the purpose of regulating insurance and it does not invalidate the intent of Chapter 74.”

A party seeking to compel arbitration has the initial burden to establish the arbitration agreement’s existence. In re Kepka, 178 S.W.3d 279, 286 (Tex.App.Houston [1st Dist.] 2005, orig. proceeding), disapproved in part on other grounds by In re Labatt Food Serv., L.P., 279 S.W.3d 640, 647 (Tex.2009) (orig.proceeding). Whether an enforceable agreement to arbitrate exists is a legal question. Id.

Chapter 74 of the Texas Civil Practice and Remedies Code is titled “Medical Liability.” See Tex. Civ. Prac. & Rem.Code Ann. §§ 74.001-74.507 (West, Westlaw through October 2010). Section 74.451 of that chapter provides, in relevant part,

(a) No physician, professional association of physicians, or other health care provider shall request or require a patient or prospective patient to execute an agreement to arbitrate a health care liability claim unless the form of agreement delivered to the patient contains a written notice in 10-point boldface type clearly and conspicuously stating:
UNDER TEXAS LAW, THIS AGREEMENT IS INVALID AND OF NO LEGAL EFFECT UNLESS IT IS ALSO SIGNED BY AN ATTORNEY OF YOUR OWN CHOOSING. THIS AGREEMENT CONTAINS A WAIVER OF IMPORTANT LEGAL RIGHTS, INCLUDING YOUR RIGHT TO A JURY. YOU SHOULD NOT SIGN THIS AGREEMENT WITHOUT FIRST CONSULTING WITH AN ATTORNEY.

Id. § 74.451(a).

The MFA provides, in pertinent part, “[n]o Act of Congress shall be construed to invalidate, impair, or supersede any law enacted by any State for the purpose of regulating the business of insurance, or which imposes a fee or tax upon such business, unless such Act specifically relates to the business of insurance.” 15 U.S.C.A. § 1012(b) (West, Westlaw through October 2010). The MFA will prevent a federal statute from preempting a state statute if (1) the federal statute at issue does not specifically relate to the “business of insurance,” (2) the state law was enacted for “the purpose of regulating the business of insurance,” and (3) the federal statute operates to “invalidate, impair, or supersede” the state law. Kepka, 178 S.W.3d at 288.

Here, Forest Lane does not argue, and the record does not show, that (1) the requirements of section 74.451(a) were met with respect to the arbitration provision at issue or (2) relator’s claims are not “health care liability” claims. Rather, the parties dispute whether the analysis set forth in Kepka should be determinative in this case.

Kepka involved a relator who sued a nursing home for negligence in caring for her husband, who was deceased at. the time suit was filed. Id. at 283-84. When the nursing home moved to compel arbitration in accordance with an agreement signed by the relator, she argued the arbitration agreement failed to comply with the notice requirement of section 15.01 of Revised Civil Statute article 4590i, the predecessor to section 74.451, which was then in effect. Id. at 287-88. The wording of the notice requirement of section 15.01 of article 4590i was identical to that of current section 74.451. See Act of May 25, 1993, 73rd Leg., R.S., ch. 625, § 4, 1993 Tex. Gen. Laws 2347, 2349-50, repealed by Act of June 2, 2003, 78th Leg., R.S., ch. 204, § 10.09, 2003 Tex. Gen. Laws 847, 884 (current version at Tex. Civ. PRác. & Rem. Code Ann. § 74.451). The nursing home argued the FAA preempted application of article 4590i, and relator argued the FAA was reverse preempted under the MFA. Kepka, 178 S.W.3d at 287-88. The appellate court concluded the MFA prevented the FAA from preempting the notice requirements of article 4590L Id. at 290-92.

Relator asserts that pursuant to the analysis set forth in Kepka, the MFA reverse preempts the FAA in this case, and thus, the mandatory notice requirement of section 74.451 applies. Forest Lane “respectfully disagrees with the Court’s finding in Kepka that Chapter 74 and its predecessor, article 4590i, ‘regulates the business of insurance’ within the meaning of the MFA.” Forest Lane argues that “not one provision of Chapter 74 addresses insurance per se but rather regulates the procedural and substantive aspects of health care liability claims, which has the incidental impact of reducing claims and insurance premiums.” In support of that position, Forest Lane cites Chapter 74. However, the court in Kepka, addressing a similar contention as to article 4590i, concluded that article, including its notice provision in section 15.01, was a law enacted “for the purpose of regulating the business of insurance” because it “ ‘possessed] the end, intention, or aim of adjusting, managing, or controlling the business of insurance,’ that is, the relationship between health-care insurers and their insured (health providers).” Id. at 291 (quoting U.S. Dep’t of the Treasury v. Fabe, 508 U.S. 491, 505, 113 S.Ct. 2202, 124 L.Ed.2d 449 (1998)); see also Patterson v. Nexion Health, Inc., 2007 WL 2021326, at *3 (E.D.Tex.2007) (concluding section 74.451 was enacted for purpose of regulating insurance and MFA reverse preempts FAA with respect to section 74.451). Based on the analysis in Kepka regarding article 4590i, which was recodi-fied as Chapter 74, see Diversicare Gen. Partner, Inc. v. Rubio, 185 S.W.3d 842, 846 n. 1 (Tex.2005), we disagree with Forest Lane’s position. Cf. Kepka, 178 S.W.3d at 290-91 (discussing provisions of article 4590i and its purposes); Tex. Civ. PRAC. & Rem.Code Ann. § 74.001 et seq.

Additionally, Forest Lane asserts that in In re Nexion Health at Humble, Inc., 173 S.W.3d 67 (Tex.2005) (orig.proceeding), the Texas Supreme Court “found that the FAA would apply where Texas law imposes additional burdens on the formation of an arbitration agreement (i.e., requiring an attorney to sign it to be ‘enforceable ’)” (emphasis original). According to Forest Lane, In re Nexion is “controlling in this matter.” However, the court in In re Nexion did not address whether the MFA prevents the FAA from preempting article 4590i or section 74.451. Further, in a supplemental opinion on motion for rehearing in that ease, the supreme court stated

On rehearing, the real party raised for the first time that the [FAA] is “reverse preempted” by the [MFA], citing for authority [Kepka]. Because this issue has not been reviewed by the courts below, we decline to reach the issue and express no opinion as to the merits of this argument.

Id. at 70 (citations omitted). Consequently, we disagree with Forest Lane that In re Nexion is “controlling in this matter.”

Finally, Forest Lane argues that “the United States Supreme Court has held that the FAA preempts state contractual requirements that apply only to arbitration clauses, which is what the notice requirements of Chapter 74 do.” In support of that argument, Forest Lane cites Doctor’s Associates, Inc. v. Casarotto, 517 U.S. 681, 686-87, 116 S.Ct. 1652, 134 L.Ed.2d 902 (1996). The Supreme Court stated in that case that courts may not “invalidate arbitration agreements under state laws applicable only to arbitration provisions.” Id. at 687, 116 S.Ct. 1652 (emphasis original). However, unlike this case, Doctor’s Associates did not involve the issue of reverse preemption by another federal statute. See id. at 681, 116 S.Ct. 1652. Forest Lane cites no authority, and we have found none, for the proposition that reverse preemption by the MFA is precluded on the facts before us.

Assuming without deciding that the FAA could preempt the notice requirement of section 74.451, we conclude the MFA reverse preempts the FAA with regard to such notice requirement in this case. Accordingly, we conclude (1) the arbitration provision in this case is unenforceable and (2) the trial court abused its discretion by ordering relator’s individual claims to arbitration.

2. Adequate Remedy By Appeal

In her third issue, relator asserts she has no adequate remedy by appeal. Relator contends that if she is forced to arbitrate her claims, (1) she will “inevitably incur fees and expenses which she cannot recover through any contractual claim” and (2) the resolution of her claims in arbitration will ultimately be subject to a reversal due to the improperly conducted proceeding, thus resulting in the waste of substantial time, money, and resources. Further, relator asserts the Texas Legislature’s purpose in enacting section 74.451 will be defeated because (1) she was improperly presented with an arbitration provision that did not contain any of the required written notice language and (2) she “will be forced to arbitrate against the mandate of Section 74.451.” Forest Lane does not address the adequacy of relator’s remedy by appeal.

“There is no definitive list of when an appeal will be ‘adequate,’ as it depends on a careful balance of the case-specific benefits and detriments of delaying or interrupting a particular proceeding.” In re Gulf Exploration, 289 S.W.3d at 842. Further, the supreme court has stated that “[i]n those rare cases when legislative mandates conflict, mandamus ‘may be essential to preserve important substantive and procedural rights from impairment or loss, [and] allow the appellate courts to give needed and helpful direction to the law that would otherwise prove elusive in appeals from final judgments.’ ” Id. at 843 (quoting In re Prudential Ins. Co., 148 S.W.3d at 136).

While the court in Gulf Exploration did not purport to establish a list of specific factors to balance respecting adequacy of an appeal, one of the factors considered in that case was that “[a] party that prevails on a contractual claim can recover its fees and expenses, even if they were incurred in collateral proceedings like arbitration.” Id. at 843-44. Thus, delay and expense in cases in which arbitration clauses cover contractual claims “generally do not render a final appeal inadequate.” Id. at 843. However, here the action involves claims sounding in tort, rather than contract claims. See In re Lisa Laser USA, Inc., 310 S.W.3d 880, 884 (Tex.2010) (orig.proceeding) (“[A] claim is brought in contract if liability arises from the contract, while a claim is brought in tort if liability is derived from other general obligations imposed by law.”) (quoting In re Int’l Profit Assocs., Inc., 274 S.W.3d 672, 677 (Tex.2009) (orig.proceeding)). Thus, it is not clear that any fees and expenses incurred as a result of arbitration will be recoverable. Further, because this case is one of those “rare cases” when legislative mandates might be construed to conflict, mandamus will “preserve important substantive and procedural rights from impairment and loss, [and] allow the appellate courts to give needed and helpful direction to the law that would otherwise prove elusive in appeals from final judgments.” See Gulf Exploration, 289 S.W.3d at 843; see also In re McAllen Med. Ctr., Inc., 275 S.W.3d at 462 (“mandamus relief is available when the purposes of the health care statute would otherwise be defeated”). Therefore, we conclude relator lacks an adequate remedy by appeal in this case.

3. Timeliness of Relator’s Petition for Writ of Mandamus

Finally, we address the contention of Forest Lane, in its response to relator’s petition for writ of mandamus, that relator’s petition for writ of mandamus is untimely. and should be denied because it was filed nearly six months after the date of the trial court’s order compelling the parties to arbitration. Forest Lane argues (1) it has been prejudiced by relator’s delay in seeking appellate relief, as Forest Lane should already be moving forward with the individual claims of relator in the arbitration process and (2) relator can show no justification for her delay in waiting nearly six months to seek appellate relief. Therefore, Forest Lane asserts, relator’s petition must be denied.

In a reply to Forest Lane’s response, relator argues she has “amply explained the reasons for any delay.” Specifically, relator asserts (1) because the parties agreed in May 2010 to participate in a mediation, “it would have made little sense” for relator to proceed with appellate relief prior to that mediation, (2) several weeks after the parties’ June 2010 mediation proceeding, Forest Lane filed a motion to clarify the trial court’s March 29, 2010 order, which could have affected the appellate relief sought by relator, and (8) relator filed her “first” petition for writ of mandamus less than two weeks after the trial court ruled upon Forest Lane’s motion to clarify, but that “first” petition was “denied due to an issue with the Certification.” Further, relator contends Forest Lane has made “no showing of any prejudice” (emphasis original).

Issuance of mandamus relief “is largely controlled by equitable principles.” In re Laibe Corp., 307 S.W.3d 314, 318 (Tex.2010) (orig.proceeding) (citing Rivercenter Assocs. v. Rivera, 858 S.W.2d 366, 367 (Tex.1993) (orig.proceeding)). To invoke the equitable doctrine of laches, the moving party ordinarily must show an unreasonable delay by the opposing party in asserting its rights, and also the moving party’s good faith and detrimental change in position because of the delay. Id. Here, the record does not show Forest Lane has demonstrated a detrimental change in position between the time of the trial court’s order and the filing of relator’s mandamus petition. See id. Therefore, we cannot agree with Forest Lane’s contention respecting the untimeliness of relator’s petition.

III. CONCLUSION

We conclude that because the arbitration provision at issue is unenforceable, the trial court abused its discretion by ordering relator’s individual claims to arbitration. Further, we conclude relator lacks an adequate remedy by appeal. Therefore, we conditionally grant relator’s petition for mandamus and order the trial court to (1) vacate its March 29, 2010 order granting, in part, the “MOTION TO COMPEL ARBITRATION AND DISMISS, OR, IN THE ALTERNATIVE, STAY PROCEEDINGS” of real party in interest and (2) render an order denying real party in interest’s “MOTION TO COMPEL ARBITRATION AND DISMISS, OR, IN THE ALTERNATIVE, STAY PROCEEDINGS” in its entirety. The writ will issue only if the trial court fails to comply.

      . While the trial court's March 29, 2010 order names "Forest Lane Healthcare Center and THI of Texas at Forest Lane, LLC” as “Defendants,” those same "defendants” are identified elsewhere in the record as "THI of Texas at Forest Lane, LLC d/b/a Forest Lane Healthcare Center.” We refer to those "defendants” in the singular in this opinion.

      . Jacqueline Estelle, a daughter of the deceased, was also named as a plaintiff in the December 3, 2009 petition. Estelle is not involved in this mandamus proceeding.

      . The record shows relator filed a “Notice of Filing and Service of Tex. Civ. Prac. & Rem. Code § 74.351 Expert Reports and Curriculum Vitae” on March 24, 2010. See Tex. Civ. Prac. & Rem.Code Ann. § 74.351 (West Supp. 2010).

      . Although, as stated above, Forest Lane asserts “the MFA does not reverse preempt the FAA because Chapter 74 of the Texas Civil Practice & Remedies Code was not enacted for the purpose of regulating insurance and it does not invalidate the intent of Chapter 74,” Forest Lane provides no argument or citation to authority regarding invalidation of the intent of Chapter-74. Accordingly, to the extent Forest Lane asserts a separate argument as to invalidation of the intent of Chapter 74, we conclude Forest Lane has waived that argument. See Tex.R.App. P. 52.4, 52.3(h).

      . In light of our conclusions respecting relator's first issue, we need not address relator’s second issue, in which she asserts, independently, that the trial court abused its discretion by finding that she signed the contract in her individual capacity. See Tex.R.App. P. 47.1.


source: Caselaw Access Project

author: SUE WALKER, Justice.

license: Public Domain

text:
    In re Mary RICHARDSON, Relator.
    No. 02-10-00337-CV.
    Court of Appeals of Texas, Fort Worth.
    Nov. 2, 2010.
    Constance M. Maher, The Maher Law Firm, Arlington, TX, for Relator.
    Stephen L. Tatum, Jordan M. Parker, Stephen D. Taylor, Cantey Hanger LLP, Fort Worth, TX, for Real Party in Interest.
    Panel: LIVINGSTON, C.J.; DAUPHINOT and WALKER, JJ.
   OPINION

SUE WALKER, Justice.

I. Introduction

This original proceeding stems from a prior interlocutory appeal and judgment issued by this court. See Foster v. Richardson, 303 S.W.3d 833 (Tex.App.-Fort Worth 2009, no pet.). Because the trial court has issued an order that fails to carry out our mandate and interferes with our judgment in this prior appeal, we will conditionally grant the petition for. writ of mandamus.

II. The Prior Interlocutory Appeal(s)

In the prior interlocutory appeal pertinent to this original proceeding, Daniel L. Foster, D.O. appealed the trial court’s order denying his motion to dismiss Mary Richardson’s health care liability claim against him for failure to file an adequate expert report as required by chapter 74 of the civil practice and remedies code. Foster, 303 S.W.3d at 833. In that appeal, we affirmed in part the trial court’s order denying Dr. Foster’s motion to dismiss, and we reversed, and remanded in part. Id. at 836. Specifically, we found Richardson’s expert’s report on causation adequate as to one of her claims and inadequate as to another of her claims. Id. at 841-42.

We held that the expert report adequately addressed causation on Richardson’s claim that Dr. Foster’s alleged misdiagnosis of her ankle fracture caused her to suffer an additional approximately one month of pain and disability. Id. We explained that the report was adequate on the causation element of this claim because the report adequately

links Richardson’s continued pain and disability related to the fracture to Dr. Foster’s erroneous diagnosis for as long a period — here, more than a month— until her condition was correctly diagnosed and treated.
For these reasons, we hold that, to the extent that Richardson’s claim against Dr. Foster concerns her prolonged pain because of his alleged misdiagnosis, the trial court did not abuse its discretion by denying Dr. Foster’s motion to dismiss based on his allegation that [Richardson’s expert’s] causation opinion is factually unsupported or inadequately explained.

Id. at 840-41 (footnote omitted). We held that the expert report inadequately addressed causation on Richardson’s claim that Dr. Foster’s alleged misdiagnosis caused Richardson to require ankle surgeries or caused other harmful conditions related to the surgeries. Id. We explained that, according to Richardson’s expert, another doctor had failed for six months to diagnose Richardson’s ankle fracture and that

[Richardson’s expert’s] report does not identify how Dr. Foster’s alleged misdiagnosis in June 2007, which caused about one month’s delay in correctly diagnosing the ankle injury after the-correct diagnosis had already been delayed for about six months since the initial injury in December 2006, contributed to the requirement of such exhaustive care. In other words, the report does not explain beyond mere conjecture how the condition of Richardson’s ankle worsened from June 2007 to July so that Dr. Foster’s failure to give a correct diagnosis in June caused the requirement of further treatment in July that would not have otherwise been required if Dr. Foster had correctly diagnosed the injury. Thus, we hold that the trial court abused its discretion to the extent that it found that [Richardson’s expert] provided a sufficient explanation about Dr. Foster’s actions causing Richardson’s ankle treatment.

Id. at 842 (citation omitted).

In light of these holdings, we set forth our conclusion:

Having overruled the majority of Dr. Foster’s sole issue regarding Richardson’s assertion that his alleged misdiagnosis caused her additional pain, we affirm the trial court’s order denying his motion to dismiss as to that issue. Having sustained a portion of Dr. Foster’s sole issue concerning Richardson’s assertion that his alleged misdiagnosis caused her need for ankle surgeries and having found [Richardson’s expert’s] report deficient as to that causal relationship, we reverse the trial court’s decision regarding the sufficiency of the report in that regard and remand this case to that court to consider the issue of whether to grant Richardson a thirty-day extension to cure that deficiency.

Id. at 845-46. Neither Dr. Foster nor Richardson filed a petition for review after we issued our judgment, and our mandate issued on March 11, 2010.

Our mandate to the 17th District Court provided, in pertinent part:

This court has considered the record on appeal in this case and holds that there was error in part of the trial court’s judgment. It is ordered that the judgment of the trial court is affirmed in part and reversed and remanded in part. We affirm that portion of the trial court’s judgment denying appellant’s motion to dismiss. We reverse that portion of the trial court’s judgment regarding the sufficiency of the expert report as to the causal relationship between the alleged misdiagnosis and appellee’s need for surgery. We remand this case for consideration of whether to grant appel-lee a thirty-day extension to cure that deficiency and for further proceedings consistent with this opinion.

III. The Trial Court Proceeding

After we issued our opinion and judgment in Foster and the case was remanded to the trial court, Richardson elected to not file an amended expert report curing, if possible, the causation inadequacy addressed in our opinion as set forth above. She decided instead to move forward only on the claim on which, as addressed in our opinion, her expert had set forth an adequate causation opinion — the claim that Dr. Foster’s alleged misdiagnosis of her ankle fracture caused her a prolonged, approximately one-month period of pain and disability.

Dr. Foster, however, filed a second motion to dismiss. He argued that because Richardson had not filed an amended expert report, all of her claims against him must be dismissed. Richardson filed a response to Dr. Foster’s second motion to dismiss pointing out that this court had found her expert’s report sufficient as to her claim that Dr. Foster’s alleged misdiagnosis of her ankle fracture caused her a prolonged period of pain and disability. The trial court granted Dr. Foster’s motion and dismissed all of Richardson’s claims against him.

IV. This Mandamus

Richardson filed this original proceeding claiming that the trial court had abused its discretion by dismissing for an inadequate expert report the very claim that this court had reviewed and found that her expert report adequately addressed. We requested a response to Richardson’s petition for writ of mandamus, and Dr. Foster filed one.

Upon receiving the appellate court’s mandate, the lower court has a mandatory, ministerial duty to enforce the appellate court’s judgment. See Tex. R.App. P. 51.1(b); In re Marriage of Grossnickle, 115 S.W.3d 238, 243 (Tex.App.-Texarkana 2003, no pet.). The lower court has no discretion to review or interpret the mandate but, instead, must carry out the mandate. Grossnickle, 115 S.W.3d at 243; see also In re Columbia Med. Ctr. of Las Colinas, 306 S.W.3d 246, 248 (Tex.2010) (orig. proceeding). A court of appeals may issue a writ of mandamus to enforce its jurisdiction and to prevent the trial court from interfering with its judgments. See Tex. Gov’t Code Ann. § 22.221(a) (Vernon 2004); In re Johnson, 961 S.W.2d 478, 481 (Tex.App.-Corpus Christi 1997, orig. proceeding) (conditionally granting writ of mandamus directing trial court to vacate orders issued by it that interfered with execution and enforcement of judgment); Upjohn Co. v. Marshall, 843 S.W.2d 203, 204 (Tex.App.-Dallas 1992, orig. proceeding) (same).

The trial court’s August 30, 2010 order dismissing Richardson’s claim against Dr. Foster for the prolonged pain and disability caused by his alleged misdiagnosis of her ankle fracture fails to carry out our March 11, 2010 mandate affirming the portion of the trial court’s judgment that denied Foster’s motion to dismiss and interferes with our opinion and judgment holding that Richardson’s expert’s report (the exact same report Richardson relies on in the trial court) was adequate as to that claim. Thus, the trial court’s August 30, 2010 order constitutes an abuse of discretion. See, e.g., Columbia Med. Ctr., 306 S.W.3d at 248 (holding that trial court was required to give full effect to supreme court's judgment and that “[b]y failing to do so, the trial court abused its discretion”).

Dr. Foster argues that mandamus is inappropriate because Richardson has an adequate remedy at law by way of an interlocutory appeal of the trial court’s dismissal order. But we have already addressed in an interlocutory appeal the adequacy of Richardson’s expert’s report on her claim against Dr. Foster for misdiagnosing her ankle fracture and thereby causing her an approximately one-month period of prolonged pain and disability. Foster, 303 S.W.3d at 840-41. We held that the report was adequate as to this claim. Id. Richardson is not required to perfect a second interlocutory appeal in order to require the trial court to give effect to our judgment and mandate in Foster. Requiring Richardson to pursue a second interlocutory appeal to obtain relief we have already granted in a prior interlocutory appeal is not an adequate remedy at law. See Columbia Med. Ctr., 306 S.W.3d at 248 (explaining that “[b]ecause this issue arises in connection with a final judgment following an appeal to this Court, we conclude that Columbia now has no other adequate remedy by appeal”); see generally In re Masonite Corp., 997 S.W.2d 194, 198 (Tex.1999) (orig. proceeding) (recognizing appellate remedy inadequate when trial court’s abuse of discretion constituted automatic reversible error).

V. Conclusion

Because the trial court’s August 30, 2010 dismissal order fails to carry out our mandate issued in Foster and interferes with our judgment in Foster, we conditionally grant a writ of mandamus directing the trial court to vacate its August 30, 2010 order granting Dr. Foster’s second motion to dismiss to the extent that it dismisses Richardson’s claim against Dr. Foster for prolonged pain and disability during the approximately one-month time period attributable to his alleged misdiagnosis of her ankle fracture. See Columbia Med. Ctr., 306 S.W.3d at 248; see also Johnson, 961 S.W.2d at 481 (“[W]hen the appellate court has once determined the validity of injunctive relief by interlocutory appeal, any attempt by the trial court to interfere with that determination by a subsequent inconsistent order is reviewable by mandamus.”); Upjohn Co., 843 S.W.2d at 204-05 (“The [trial court] order threatens interference with this Court’s judgment in that appeal.”).

The writ will issue only if the trial court fails to comply with this opinion.

      . This is the third opinion we have issued in this case, all dealing with the same expert report — In re Richardson, No. 02-10-00077-CV (the present case), Otero v. Richardson, 326 S.W.3d 363 (Tex.App.-Fort Worth 2010, no pet. h.), and Foster, 303 S.W.3d at 833.

      . Dr. Foster’s motion alleged that since the appeal
      Plaintiff has not requested a thirty-day extension of time to cure the deficiency in [her expert's] report and has not filed an amended expert report curing such deficiency. Accordingly, Plaintiff has waived any right to cure the deficiencies ... and Dr. Foster is entitled to dismissal from this lawsuit, recovery of his attorneys' fees, costs, and severance.


author: Justice O’NEILL..

text:
    BDO SEIDMAN, LLP, James Fielding, Morris Gottlieb, and Lawrence Cohen, Appellants, v. J.A. GREEN DEVELOPMENT CORP., Jagi, Inc., and Jagi Verde, LLC, Appellees.
    No. 05-09-01520-CV.
    Court of Appeals of Texas, Dallas.
    Nov. 9, 2010.

      Robert W. Kantner, DLA Piper US LLP, Dallas, Cary B. Samowitz, DLA Piper LLP (US), New York, NY, Melanie B. Rother, Fulbright & Jaworski LLP, Houston, for Appellants.
    David R. Deary, Carol E. Farquhar, J. Dylan Snapp, Loewinsohn, Flegle and Deary, L.L.P., Dallas, for Appellees.
    Before Justices MOSELEY, O’NEILL, and LANG-MIERS.
   OPINION

Opinion By

Justice O’NEILL..

Appellants BDO Seidman, LLP, James Fielding, Morris Gottlieb, and Lawrence Cohen (collectively referred to as “BDO”) appeal the trial court’s order denying their motion to compel arbitration against appel-lees J.A. Green Development Corporation, Jagi, Inc., and Jagi Verde, LLC (collectively referred to as “Green”). BDO raises three issues on appeal: (1) whether the Federal Arbitration Act (“FAA”) or New York law determines whether Green’s claims against BDO are arbitrable; (2) whether Green’s claims are within the scope of the consulting agreement’s arbitration clause; and (3) whether the arbitration clause is unconscionable.

We reverse the trial court’s order denying arbitration and remand with instructions to order the parties to arbitration and stay the underlying case pending outcome of the arbitration.

Background

Green is a New York corporation involved in real estate development. In 1998, Green negotiated the sale of property near JKF International Airport and gained approximately $35 million from the sale. Green later met with BDO to discuss options for reducing tax liability, which included using a distressed debt strategy. In March 2001, Green entered into a tax consulting agreement with BDO, which included the following broad arbitration provision:

(d) If any dispute, controversy or claim arises in connection with the performance or breach of this agreement and cannot be resolved by facilitated negotiations (or the parties agree to waive that process) then such dispute, controversy or claim shall be settled by arbitration in accordance with the laws of the State of New York, and the then current Arbitration Rules for Professional Accounting and Related Disputes of the American Arbitration Association (“AAA”)....

The Internal Revenue Service later determined the distressed debt strategy implemented by BDO was nothing more than an illegal tax shelter. After an audit, the IRS assessed Green $5,147,555.00 in penalties and interest. Green filed suit against BDO asserting, among several causes of action, that BDO knew the distressed debt strategy was an illegal tax shelter and fraudulently induced them to enter into the consulting agreement.

BDO filed a motion to compel arbitration and to stay or dismiss Green’s lawsuit pending outcome of the arbitration based on the arbitration clause in the consulting agreement. After a hearing, the trial court denied the motion. This accelerated appeal followed.

Standard of Review

Whether an arbitration clause imposes a duty to arbitrate is a matter of contract interpretation and a question of law for the court to review de novo. See Tex. Petrochemicals, L.P. v. ISP Water Mgmt. Servs., L.L.C., 301 S.W.3d 879, 884 (Tex.App.-Beaumont 2009, no pet.); see also McReynolds v. Elston, 222 S.W.3d 731, 740 (Tex.App.-Houston [14th Dist.] 2007, no pet.). In a de novo review, the trial court’s decision is given absolutely no deference. Quick v. City of Austin, 7 S.W.3d 109, 116 (Tex.1998). Although BDO requested findings of fact and conclusions of law, the trial court failed to file any. Therefore, we may affirm the trial court’s decision on any legal theory supported by the evidence. In re Guardianship of Fortenberry, 261 S.W.3d 904, 910 (Tex.App.-Dallas 2008, no pet.).

Does New York Law or the FAA Apply?

As a threshold matter, we must determine whether New York substantive law governs the arbitration agreement or if the FAA applies. BDO argues the FAA applies because although the arbitration provision states New York law applies, it does not contain the specific “enforcement” language required to trigger enforcement under New York law. Thus, by default, the FAA applies. Green contends BDO misconstrues New York law because the arbitration clause is not required to have any sort of special “enforcement” language. Rather, there are two situations in which New York law governs an arbitration: (1) if the entire agreement (as opposed to the arbitration provision within the agreement) contains a choice-of-law provision providing that the entire agreement and its “enforcement” are governed by New York law or (2) if the arbitration provision itself (as opposed to the entire agreement) explicitly provides that arbitration is governed by New York law. As explained below, we agree with BDO.

BDO argues Diamond Waterproofing Systems, Inc. v. 55 Liberty Owners Corporation, 4 N.Y.3d 247, 793 N.Y.S.2d 831, 826 N.E.2d 802 (2005) is controlling. In that case, parties entered into a contract agreeing to submit “[a]ny controversy or Claim arising out of or related to the Contract” for arbitration. The contract further provided “[it] shall be governed by the law of the place where the Project is located.” Id. at 804. After a dispute arose, 55 Liberty Owners demanded arbitration, and Diamond Waterproofing sought to permanently stay arbitration. Id. On appeal, the issue for New York’s highest court was whether the FAA applied to the arbitration clause. It noted that where parties broadly agree to arbitrate “any controversy” arising from their contracts, they may — as with any contract — add qualifications to that clause by providing New York law will govern the agreement and its enforcement. Id. at 806 (emphasis added). It went on to hold

A choice of law provision, which states that New York law shall govern both “the agreement and its enforcement,” adopts as “binding New York’s rule that threshold Statute of Limitations questions are for the courts.” In the absence of more critical language concerning enforcement, however, all controversies, including issues of timeliness, are subject to arbitration.

Id. (emphasis in original). Because the parties’ arbitration clause did not express an intent to have New York law govern their agreement’s enforcement, the FAA controlled. Id.

In All Metro Health Care Services, Inc. v. Edwards, the lower court relied on Diamond Waterproofing, Inc. when determining an arbitration clause did not contain the proper enforcement language and therefore, New York law did not apply. See All Metro Health Care Servs., Inc. v. Edwards, 25 Misc.3d 863, 884 N.Y.S.2d 648, 652 (2009). In that case, a stock purchase agreement contained a choice of law provision stating the “arbitration shall be held in accordance with the laws of the State of New York.” Id. at 653. The court noted that while the stock provision stated New York law applied, the provision did not state “New York law shall govern both the agreement and its enforcement, and is therefore not sufficient to express an intention to have the court, rather than an arbitrator, determine a procedural issue.” Id. (emphasis in original). To conclude otherwise would undermine the substantial authority under the FAA for the arbitrator to determine such issues. Id.

As previously stated, the arbitration clause at issue here states “[i]f any dispute, controversy or claim arises in connection with the performance or breach of this agreement ... then such dispute, controversy or claim shall be settled by arbitration in accordance with the laws of the State of New York....” It is clear the arbitration clause does not contain the “enforcement” language necessary under New York law. Therefore, based on the clear holdings of Diamond Waterproofing and All Metro Health Care Services, we conclude the FAA determines whether Green’s objection to arbitration is decided by the court or an arbitrator. See 9 U.S.C. § 2 (2009) (stating FAA applies to any written agreement to arbitrate “a contract evidencing a transaction involving commerce”).

In reaching this conclusion, we are not persuaded by Green’s arguments that the enforcement language is only necessary in a choice of law provision governing the entire agreement. We likewise discount his arguments that so long as the arbitration clause states New York law applies, without the enforcement language, then it controls over the FAA. Green cites several cases in support of their propositions; however, we find them distinguishable.

Green contends Hackett v. Milbank, Tweed, Hadley & McCloy stands for the proposition that when an arbitration provision states New York law governs arbitration, then the FAA does not apply and enforcement language is not needed. He relies on the court’s holding, which states the following:

The overriding policy of the Act, however, is the enforcement of arbitration agreements according to their terms, including the parties’ choice of governing law.... The parties’ agreement here not only provided for binding arbitration of their dispute, it explicitly provided that New York law would govern that arbitration, and that the only grounds for vacating the arbitrator’s award are those encompassed by CPLR 7509 and CPLR 7511. Such an explicit and unambiguous choice of law in an arbitration agreement must be given effect.

86 N.Y.2d 146, 630 N.Y.S.2d 274, 654 N.E.2d 95, 100 (1995).

We recognize the arbitration provision in Hackett did not contain the enforcement language, yet the court still determined New York law applied rather than the FAA. However, the arbitration provision, in addition to providing it was governed by New York law, also incorporated two specific sections of New York’s procedural code regarding vacating an arbitration award. Id. The reference to these two sections of New York’s procedural code further established the parties’ “explicit and unambiguous choice of law.” The arbitration provision at issue in this case does not state that any claim of fraud in the inducement will be analyzed under any specific New York standard. Moreover, Hackett was before the court after the case had been arbitrated, and petitioner was attempting to vacate the award. Here, Green and BDO dispute whether arbitration is appropriate in the first place. We further conclude Hackett is unpersuasive because it was decided prior to the court’s clear pronouncement in Diamond Waterproofing, Inc. that the enforcement language is necessary for New York law to apply to an arbitration provision. Diamond Waterproofing Sys., Inc., 793 N.Y.S.2d 831, 826 N.E.2d at 806.

Green also argues Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior University, 489 U.S. 468, 109 S.Ct. 1248, 103 L.Ed.2d 488 (1989) supports their arguments; however, the issue before the Court was whether the FAA preempted California law which permitted a court to stay arbitration pending resolution of related litigation involving third parties not bound by the agreement where the parties agreed in contract to abide by the state rules of arbitration. Id. at 470, 109 S.Ct. 1248. The Court concluded application of state rules governing the conduct of arbitration did not offend any policy in the FAA; therefore, California law applied to the arbitration clause. Despite the Court’s determination California law, rather than the FAA, applied to an arbitration clause similar to the one at issue here, we conclude Green’s reliance on this authority is misplaced. California law is irrelevant to deciding issues related to New York law, particularly where New York requires specific language in an arbitration clause for enforcement.

Green also relies on an unpublished decision from New York’s lowest court, which relied on the intermediate appellate court decision in Diamond Waterproofing, not the opinion subsequently issued by New York’s highest court. See 212 Investment Corp. v. Kaplan, 6 Misc.3d 1031(A), 800 N.Y.S.2d 358 (N.Y.Sup.Ct.2005). Accordingly, 212 Investment Corporation lacks any precedential value.

Finally, we are unpersuaded by Smith Barney, Harris Upham & Co., Inc. v. Luckie, 85 N.Y.2d 193, 623 N.Y.S.2d 800, 647 N.E.2d 1308 (1995) and Salvano v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 85 N.Y.2d 173, 623 N.Y.S.2d 790, 647 N.E.2d 1298 (1995) because there decisions were prior to Diamond Waterproofing, Inc.

Thus, we conclude based on the clear holdings of Diamond Waterproofing, Inc. and All Metro Health Care Services, the FAA applies to this case. We sustain BDO’s first issue. Having reached this conclusion, we need not address the parties’ arguments regarding preemption.

Do Green’s Claims Fall Within the Scope of the Arbitration Provision?

We must now determine whether Green’s claims fall within the scope of the parties’ arbitration agreement. In their second issue, BDO contends the broad language of the provision covers all of Green’s claims, as all of their claims involve the tax advice BDO provided under the consulting agreement. Green responds the claims do not fall within the scope of the arbitration provision because BDO intentionally omitted the distressed debt strategy from the scope of services to be rendered under the consulting agreement, and the consulting agreement specifically states it does not apply to investment advice and services.

It has been established where a contract contains an arbitration clause, there is a presumption of arbitrability in the sense that “[a]n order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage.” AT & T Tech., Inc. v. Commc’n Workers of Am., 475 U.S. 643, 650, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986). Such a presumption is particularly applicable where the clause is broad. Id. In such cases, “[i]n the absence of any express provision excluding a particular grievance from arbitration, we think only the most forceful evidence of a purpose to exclude the claim from arbitration can prevail.” Id. (citing United Steelworkers of Am. v. Warrior & Gulf Navigation Co., 363 U.S. 574, 584-85, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960)).

The arbitration provision at issue broadly states that “if any dispute, controversy, or claim arises in connection with the performance or breach of this agreement ... such dispute, controversy, or cláim shall be settled by arbitration....” The consulting agreement provides under “Services ” that BDO agrees to “assist[...] the Client and/or his advisors in structuring the transaction(s) to attain the most beneficial tax results.... ” It further states- “BDO agrees to provide assistance to the Client and/or their representatives with certain income tax planning as well assisting with certain income tax and other financial aspects of various anticipated investment activities.”

Although the agreement specifically states BDO is not in the business of providing investment advice or services, we agree with BDO that Green’s claims directly relate to the distressed debt strategy, which involved tax planning advice. And “Services ” under the consulting agreement specifically include assistance with income tax planning and structuring transactions to attain beneficial tax results.

Throughout their first amended petition, Green made claims directly related to the consulting agreement including rescission, declaration that agreements are unenforceable, and breach of contract. Further, the remaining causes of action directly relate to the distressed debt strategy, which involved tax advice for which Green agreed to pay a $8,300,000 fee (the “consulting fee”). Green repeatedly alleged in his response to BDO’s motion to compel arbitration that the consulting agreement was an “integral part of the overall conspiracy to commit criminal fraud.”

Thus, despite Green’s arguments to the contrary, there is no question each and every claim in their first amended petition centrally concerns the tax advice BDO provided and Green’s claims that BDO breached the consulting agreement by providing improper tax advice. Because the claims “arise in connection with the performance or breach of this agreement,” they are within the scope of the broad arbitration provision contained in the consulting agreement. See Jamaica Hosp. Med. Ctr., Inc. v. Oxford Health Plans (N.Y.), Inc., 58 A.D.3d 686, 871 N.Y.S.2d 665, 666 (N.Y.App.Div.2009) (holding plaintiffs’ claims, as alleged in amended complaint, all arise from or relate to their contracts with defendants and are within scope of broad arbitration provision). Thus, arbitration must be compelled, and the trial court erred in denying BDO’s motion. See Genesco, Inc. v. T. Kakiuchi & Co., 815 F.2d 840, 846 (2d Cir.1987) (holding if allegations underlying the claim “touch matters” covered by parties’ agreement, then claims must be arbitrated). We sustain BDO’s second issue.

Is the Arbitration Provision Unconscionable?

Having determined Green’s claims fall within the arbitration provision, we must finally determine if the provision itself is unconscionable and prevents arbitration. In their third issue, BDO argues Green has not carried their burden to prove the provision is unconscionable. Green responds the arbitration provision violates public policy because it was part of a conspiracy to commit criminal fraud.

An unconscionable contract provision is defined as one that “is grossly unreasonable or unconscionable in light of the mores and business practices of the time and place as to be unenforcible according to its literal terms.” Gillman v. Chase Manhattan Bank, N.A., 73 N.Y.2d 1, 537 N.Y.S.2d 787, 534 N.E.2d 824, 828 (1988). A determination of unconscionability generally requires a showing that the contract was procedurally and substantively unconscionable when made. Id. (noting it requires “some showing of an absence of meaningful choice on the part of one of the parties together with contract terms which are unreasonably favorable to the other party”); see also Accurate Copy Serv. of Am., Inc. v. Fisk Bldg. Assoc. L.L.C., 72 A.D.3d 456, 899 N.Y.S.2d 157, 157 (N.Y.App.Div.2010) (noting claim for an unconscionable contract requires facts supporting both procedural and substantive unconscionability); Moss v. Rent-A-Center, No. 06-CV-3312, 2007 WL 2362207, at *5 (E.D.N.Y.2007).

The procedural element of uncon-scionability requires an examination of the contract formation process and the alleged lack of meaningful choice. Gillman, 537 N.Y.S.2d 787, 534 N.E.2d at 828. Green argues the arbitration provision violates public policy because it was part of a conspiracy to commit criminal fraud. Additionally, Green argues they had absolutely no input in the language of the provision, it was contained in the consulting agreement that BDO deliberately designed in a fraudulent manner, and BDO never discussed the provision with them.

We are not persuaded by Green’s allegations that BDO made numerous false representations, which induced them to enter into the arbitration provision. As previously stated, Green’s claims involve BDO’s breach of the consulting agreement by providing improper tax advice. Their claims do not involve any fraud in the making of the arbitration agreement itself. Rather, Green repeatedly states the consulting agreement was an integral part of an overall conspiracy to commit fraud and such fraud was part of a grand scheme that permeated the consulting agreement. Green has not alleged any specific arguments regarding fraud in the formation of the arbitration agreement itself but instead focuses on the overall alleged bad acts by BDO in the formation of the consulting agreement. The law is well-settled that such claims are proper for an arbitrator to decide. See Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 402, 87 S.Ct. 1801, 18 L.Ed.2d 1270 (1967) (holding if the claim is fraud in the inducement of the arbitration clause itself — -an issue which goes to the making of the agreement to arbitrate — the federal court may proceed to adjudicate it; otherwise, claims involving the contract generally should be decided by the arbitrator); see also Campaniello Imports, Ltd. v. Saporiti Italia, S.p.A., 117 F.3d 655, 667 (2d Cir.1997) (case properly sent to arbitration when there was no fraud or misrepresentation directly relating to arbitration clause); Kowalewski v. Samandarov, 590 F.Supp.2d 477, 487 (S.D.N.Y.2008) (holding it is well-established a challenge of uncon-scionability to the whole contract, as opposed to the arbitration provision specifically, is “an arbitrable matter not properly considered by the court”).

Thus, because the issue of uneonsciona-bility is for the arbitrator to decide, we do not reach BDO’s third issue.

Conclusion

After sustaining BDO’s two relevant issues, we conclude the trial court erred in denying their motion to compel arbitration. We reverse the trial court’s order denying arbitration and remand to the trial court with instructions to order the parties to arbitration and stay the underlying case pending outcome of the arbitration.

      . Although the outcome of this case is based on our interpretation of New York and federal law, neither party disputes the standard of review as de novo. Further, both parties cite Texas case law for support.

      . Green concedes that if neither of these situations are present, then the FAA applies because it is undisputed the contract involves interstate commerce. See In re FirstMerit Bank, N.A., 52 S.W.3d 749, 754 (Tex.2001) (holding contract relating to interstate commerce is subject to FAA).

      . The contract at issue contained an agreement to arbitrate all disputes between the parties “arising out of or relating to this contract or the breach thereof,” and the contract “shall be governed by the law of the place where the Project is located.” 489 U.S. at 471 n. 1, 109 S.Ct. 1248.

      . Green makes a passing argument that the arbitration provision violates the Due Process Clause; however, they have provided no authority supporting their argument. Thus, we conclude the argument is waived. Tex.R.App. P. 38.1(i).


author: Justice MOSELEY.

text:
    SIDLEY AUSTIN BROWN & WOOD, LLP, Appellant, v. J.A. GREEN DEVELOPMENT CORP., JAGI, Inc., and JAGI Verde L.L.C., Appellees.
    No. 05-10-00008-CV.
    Court of Appeals of Texas, Dallas.
    Nov. 9, 2010.

      Michael 0. Connelly, Allison J. Miller, David George, Connelly Baker Wotring LLP, Houston, TX, Jonathan Ellis Altman, Munger, Tolies & Olson LLP, Los Ange-les, CA, for Appellant.
    David R. Deary, J. Dylan Snapp, Loew-insohn, Flegle and Deary, L.L.P, for Ap-pellees.
    Before Justices MOSELEY, O’NEILL, and LANG-MIERS.
   OPINION

Opinion By

Justice MOSELEY.

This is an interlocutory appeal from the trial court’s order denying a motion to compel arbitration under the Federal Arbitration Act (FAA). See 9 U.S.C. §§ 1-16 (2006). We have jurisdiction over this appeal under section 51.016 of the civil practice and remedies code and section 16 of the FAA. Tex. Civ. Prac. & Rem.Code Ann. § 51.016 (West Supp.2010); see also 9 U.S.C. § 16.

Appellant Sidley Austin Brown & Wood, LLP argues the trial court erred by denying its motion to compel arbitration because the unconscionability arguments raised by J.A. Green Development Corp., JAGI, Inc., and JAGI Verde L.L.C. (collectively “Green”) apply to the entire agreement and not specifically to the arbitration provision, and the provision is not otherwise unconscionable. We reverse the trial court’s order and remand with instructions to grant the motion to compel arbitration.

BACKGROUND

Green, a real estate developer, met with BDO Seidman, LLP, to discuss options for reducing its tax liability by undertaking certain distressed debt transactions. BDO introduced Green to one of Sidley Austin’s predecessors, Brown & Wood, L.L.P, which agreed to issue an opinion letter on the federal income tax consequences of the transactions. Green and Brown & Wood signed a two-page engagement letter setting out the fee for issuing the opinion letter; the engagement letter provided for the arbitration of any controversy or claim arising out of or relating to the engagement letter and the matters addressed in the letter. The engagement letter also states that the FAA governs the interpretation and enforcement of the arbitration provision.

The IRS later rejected the tax deductions Green took in connection with the transactions and assessed back taxes, interest, and penalties. In June 2009, Green sued BDO Seidman, Sidley Austin, and other advisers over the transactions and tax liabilities alleging malpractice, fraud, and other claims. Sidley Austin moved to compel arbitration under the terms of the engagement letter. In response, Green amended its petition and alleged the arbitration agreement in the engagement letter was “invalid and unenforceable.” In its response to the motion to compel, Green alleged the arbitration agreement was unconscionable because: (1) it violates public policy as it was part of a criminal fraud and conspiracy to commit criminal fraud; (2) it was procured by economic duress; and (3) it was obtained in violation of ethical standards discussed in ethics opinion issued by the State Bar of Texas.

After a hearing, the trial court denied the motion to compel without specifying the grounds for its ruling.

Standard op Review

Until recently, orders denying motions to compel arbitration in matters subject to the FAA were not subject to interlocutory appeal; instead, they were reviewed in mandamus proceedings using an abuse of discretion standard. See Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 272-73 (Tex.1992). Under that standard, “we defer to the trial court’s factual determinations if they are supported by evidence, but we review the trial court’s legal determinations de novo.” In re Labatt Food Service, L.P., 279 S.W.3d 640, 643 (Tex.2009). “Whether an arbitration agreement is enforceable is subject to de novo review.” Id.

Section 51.016 now permits courts to review such orders by appeal. See Tex. Civ. Prac. & Rem.Code Ann. § 51.016. We have not addressed the standard of review applicable to such appeals. However, on appeals of orders denying arbitration under the Texas Arbitration Act (TAA), we apply a no-evidence standard to the trial court’s factual determinations and a de novo standard to legal determinations. Trammell v. Galaxy Ranch Sch., L.P., 246 S.W.3d 815, 820 (Tex.App.-Dallas 2008, no pet.). This standard is the same as the abuse of discretion standard of review and we will apply that standard of review to interlocutory appeals under section 51.016.

Applicable Law

Under the FAA, a “written provision in ... a contract ... to settle by arbitration a controversy thereafter arising out of such contract or transaction, ... shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. Therefore, under the FAA, state law may govern arbitration agreements only “if that law arose to govern issues concerning the validity, revocability, and enforceability of contracts generally.” Doctor’s Assocs., Inc. v. Casarotto, 517 U.S. 681, 686-87, 116 S.Ct. 1652, 134 L.Ed.2d 902 (1996) (quoting Perry v. Thomas, 482 U.S. 483, 492 n. 9, 107 S.Ct. 2520, 96 L.Ed.2d 426 (1987)). “Thus, generally applicable contract defenses, such as fraud, duress, or unconscionability, may be applied to invalidate arbitration agreements without contravening § 2.” Id. “Courts may not, however, invalidate arbitration agreements under state laws applicable only to arbitration provisions.” Id.

A party seeking to compel arbitration under the FAA must establish the existence of a valid arbitration agreement between the parties and that the particular controversy is within the scope of that agreement. See In re FirstMerit Bank, N.A., 52 S.W.3d 749, 753-54 (Tex.2001). Because of state and federal policies favoring arbitration, doubts about the scope of the arbitration agreement must be resolved in favor of arbitration. Id. The party seeking to avoid arbitration then bears the burden of proving its defenses against enforcing an otherwise valid arbitration provision. Id. at 756.

Supreme Court precedent establishes three propositions relevant to enforcement of arbitration provisions as between signatories to the agreement:

First, as a matter of substantive federal arbitration law, an arbitration provision is severable from the remainder of the contract. Second, unless the challenge is to the arbitration clause itself, the issue of the contract’s validity is considered by the arbitrator in the first instance. Third, this arbitration law applies in state as well as federal courts.

Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 445-46, 126 S.Ct. 1204, 163 L.Ed.2d 1038 (2006) (citing Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 403-04, 87 S.Ct. 1801, 18 L.Ed.2d 1270 (1967); Southland Corp. v. Keating, 465 U.S. 1, 12, 104 S.Ct. 852, 79 L.Ed.2d 1 (1984)).

There are two types of challenges to an arbitration provision: (1) a specific challenge to the validity of the arbitration agreement or clause; and (2) a broader challenge to the entire contract, either on a ground that directly affects the entire agreement, or on the ground that one of the contract’s provisions is illegal and renders the whole contract invalid. See Buckeye, 546 U.S. at 444, 126 S.Ct. 1204; Labatt, 279 S.W.3d at 647-48. A court may determine the first type of challenge, but a challenge relating to the validity of a contract as a whole, and not specifically to the arbitration clause within that contract, must go to the arbitrator. See Labatt, 279 S.W.3d at 647-48; FirstMerit Bank, 52 S.W.3d at 756 (defenses of unconscionability, duress, fraudulent inducement, and revocation must specifically relate to the arbitration part of a contract and not the contract as a whole if they are to defeat arbitration).

Analysis

It is undisputed that Sidley Austin (Brown & Wood) and Green signed a written agreement containing a provision to arbitrate any controversy or claim arising out of the letter agreement or the transactions addressed in the letter. It is also undisputed that the claims Green asserts against Sidley Austin are within the scope of the arbitration provision.

Green’s arguments against enforcement of the arbitration provision are based on the defense of unconscionability. It argues the provision is unconscionable because: (1) it violates public policy as it was part of a criminal fraud and conspiracy to commit criminal fraud; (2) it was procured by economic duress; and (3) it was obtained in violation of ethical standards discussed in ethics opinion issued by the State Bar of Texas.

Sidley Austin argues that Green failed to prove the defense because the first two unconscionability arguments (fraud and duress) relate to the entire engagement between them, and not specifically to the arbitration provision itself. Sidley Austin argues the third unconscionability argument is unfounded because the ethics opinion regarding disclosures attorneys should make to clients about arbitration agreements in their engagement letters is not binding on courts and does not reflect Texas public policy, which favors arbitration. Further, Sidley Austin argues any special notice rule applicable only to arbitration agreements, as opposed to contracts generally, is preempted by the FAA.

Green’s first unconscionability argument alleges a series of misrepresentations, fraudulent conduct, and conspiracy by Sidley Austin and BDO with respect to the design, promotion, sale and implementation of the tax-reducing investment strategy and that Sidley Austin knew the IRS would disallow the transactions as an illegal tax shelter. Nothing in the record indicates these representations related specifically to the arbitration provision, as opposed to the entire engagement agreement. See FirstMerit Bank, 52 S.W.3d at 758 (there was “no evidence that the sellers actually misrepresented the [arbitration] Addendum’s terms, or that they made any false material representations with regard to the Arbitration Addendum itself’).

Green’s second argument raises duress as a ground for unconscionability. Green contends it had already paid substantial fees to certain defendants and had implemented part of the transactions when it was presented with the engagement agreement including the arbitration provision. Green contends that if it did not agree to the engagement letter, it would not receive the legal opinion and would lose the fees already paid. Again, however, Green’s argument relates to the entire engagement agreement, not just the arbitration provision. See In re RLS Legal Solutions, L.L.C., 221 S.W.3d 629, 632 (Tex.2007) (per curiam) (“Unless the arbitration provision alone was singled out from the other provisions, the claim of duress goes to the agreement generally and must be decided in arbitration.”). Indeed, Green concedes that Sidley Austin (or its predecessor) never discussed the arbitration provision with Green.

We conclude these two arguments are “broad challenged to the entire contract on the ground that one of the contract’s provisions is illegal and renders the whole contract invalid, but not specifically challenging the arbitration clause.” Labatt, 279 S.W.3d at 648-49. Because an arbitration provision is severable from the remainder of the contract and is enforceable apart from the other provisions, a challenge to the entire contract must go to arbitration under the arbitration provision. Buckeye, 546 U.S. at 445-46, 126 S.Ct. 1204; Labatt, 279 S.W.3d at 649; First-Merit Bank, 52 S.W.3d at 756 (validity of an arbitration provision is a separate issue from validity of the whole contract). We conclude the trial court abused its discretion to the extent it determined that Green’s fraud and duress unconscionability challenges defeated the arbitration provision.

Green’s third unconscionability argument is specific to the arbitration provision. Green argues the arbitration provision is unconscionable because Sidley Austin did not explain the advantages and disadvantages of arbitration to Green before entering into the agreement. Green does not contend this failure made the arbitration provision per se unconscionable, but contends it is a factor in determining unconscionability. Green fails to point out how the agreement is otherwise unconscionable; as explained above, the fraud and duress arguments relate to the entire agreement, not just the arbitration provision. Nothing else about the specific circumstances surrounding the adoption of the arbitration provision show it to be unconscionable. See In re Halliburton, 80 S.W.3d 566, 572 (Tex.2002) (rejecting argument that disparity in bargaining power between employer and employee rendered arbitration agreement proeedurally unconscionable).

The terms of the arbitration provision are not unusual and, on their face, do not favor either party. The arbitration is to be administered by the AAA, and the arbitrator is authorized to award any remedy a court of competent jurisdiction could award. Green makes no argument as to how this arbitration provision is so one-sided as to be unconscionable. See First-Merit Bank, 52 S.W.3d at 757; see also In re Poly-Am., L.P., 262 S.W.3d 337, 348 (Tex.2008) (“Uneonscionability is to be determined in light of a variety of factors, which aim to prevent oppression and unfair surprise; in general, a contract wül be found unconscionable if it is grossly one-sided.”). And we fail to see how the failure to discuss the advantages and disadvantages of arbitration generally would make an otherwise fair arbitration clause unconscionable.

By your acceptance of this letter you agree that any controversy or claim arising out of or relating to this letter, and the matters addressed herein, shall be settled by arbitration administered by the American Arbitration Association in accordance with its Commercial Rules and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. The arbitration proceeding shall be conducted in New York City, New York. The arbitrator shall have the authority to award any remedy or relief that a court of competent jurisdiction could order or grant. Except as necessary in court proceedings to enforce this arbitration provision or an award rendered hereunder, neither a party nor an arbitrator may disclose the existence, content or results of any arbitration hereunder without the prior written consent of both parties. The parties acknowledge that this letter evidences a transaction involving interstate commerce. The parties agree that United States Federal Arbitration Act shall govern the interpretation and enforcement of this arbitration provision.

Green also relies on an ethics opinion stating that an attorney should normally explain the advantages and disadvantages of arbitration before entering into an engagement letter containing an arbitration clause. See Tex. Comm, on Prof'l Ethics, Op. 586, 2008 WL 5680298, *2 (2008). Such opinions are concerned with matters of attorney discipline and are advisory rather than binding. See Labidi v. Sydow, 287 S.W.3d 922, 929 (Tex.App.Houston [14th Dist.] 2009, orig. proceeding). The commission expressly recognized it was beyond its authority “to address questions of substantive law relating to the validity of arbitration clauses in agreements between lawyers and their clients.” Tex. Comm, on Prof'l Ethics, Op. 586, 2008 WL 5680298, at *3. We conclude the trial court abused its discretion to the extent it found the arbitration provision was unconscionable on this basis.

Conclusion

We conclude Green failed to establish uneonscionability as a defense to the arbitration provision. Accordingly, the trial court abused its discretion by denying the motion to compel arbitration. We sustain Sidley Austin’s issue, reverse the trial court’s order denying the motion to compel, and remand to the trial court with instructions to grant the motion to compel arbitration.

      . The letter agreement was signed by J.A. Green Development Corp.’s vice president, James Errante.

      . In a related appeal from this suit, BDO Seidman appeals the denial of its motion to compel arbitration under a separate agreement with Green. See BDO Seidman, LLP v. J.A. Green Dev. Corp., 327 S.W.3d 852, 853-54 (Tex.App.-Dallas 2010, no pet. h.).

      . "What States may not do is decide that a contract is fair enough to enforce all its basic terms (price, service, credit), but not fair enough to enforce its arbitration clause. The [FAA] makes any such state policy unlawful, for that kind of policy would place arbitration clauses on an unequal 'footing,' directly contrary to the Act's language and Congress’s intent.” Allied-Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 281, 115 S.Ct. 834, 130 L.Ed.2d 753 (1995).

      . Green alleged that Sidley Austin included the arbitration provision in the engagement letter to limit or eliminate Green’s ability to recover from Sidley Austin, but this allegation is not supported by the language of arbitration provision. The arbitration provision expressly allows the arbitrator to "to award any remedy or relief that a court of competent jurisdiction could order or grant.”

      . Green does not assert it did not know there was an arbitration provision in the engagement letter. We presume that a party who signs a contract knows its contents. In re Bank One, N.A., 216 S.W.3d 825, 826 (Tex.2007) (per curiam). The arbitration provision is the third paragraph of a two-page letter agreement. It is not hidden or obscured in any way. None of Green's fraud allegations relate to a fraudulent representation that the engagement letter did not contain an arbitration provision or that the arbitration paragraph was something else. There is no allegation or evidence of artifice or trickery in connection with the existence of the arbitration term in the agreement.

      . The provision states:

      . Moreover, imposing additional procedural requirements for arbitration provisions in contracts between lawyers and clients — as opposed to other provisions in attorney engagement agreements — would appear to be inconsistent with the FAA. See Buckeye, 546 U.S. at 446, 126 S.Ct. 1204; Doctor’s Assocs., Inc., 517 U.S. at 687, 116 S.Ct. 1652.


author: HOLLIS HORTON, Justice.

text:
    Joe PALMA and Gladys Palma, Appellants, v. CHRIBRAN COMPANY, L.L.C., Appellee.
    No. 09-10-00075-CV.
    Court of Appeals of Texas, Beaumont.
    Submitted Sept. 16, 2010.
    Decided Nov. 10, 2010.

      Jeffrey L. Dorrell, Escamilla, Poneck & Cruz, LLP, Houston, for Joe appellants.
    H. Daniel Spain, Bradley E. Chambers, Adam W. Green, Hutson Smelley, Bobbie L. Stratton, Spain Chambers, Houston, Ray A. Burgess, Hope & Causey, Conroe, for appellee.
    Before GAULTNEY, KREGER, and HORTON, JJ.
   OPINION

HOLLIS HORTON, Justice.

We are asked to consider whether the trial court erred in granting the appellee’s no-evidence motion for summary judgment. Finding no error, we affirm the trial court’s judgment.

Background

In October 2005, the appellants, Joe and Gladys Palma, purchased a newly constructed home from Supreme Builders. Shortly after purchasing the home, Joe noticed that “water began continuously weeping from expansion joints in streets and driveways and welling up in the unpaved portions of lots in the lower-elevation areas of the streets[.]” He also noticed that water pools in watér meter recesses and remains there. In some of the development’s lots, located on another street, Joe noticed that “water wells up continuously, as though from a babbling brook through the silty, sandy soil.”

In October 2007, the Palmas sued Chri-bran Company, L.L.C., the developer of the subdivision, and Teas Lakes Owners Association, Inc., which they allege was responsible for maintaining the common areas in the development. The Palmas’ suit attributes the excess water that enters their lot to water that collects in a pond constructed by Chribran. The Palmas contend that “[m]igrating pond water” caused their driveway to become “unsightly” and “permanently slick[.]” The Pal-mas’ live pleading, their fourth amended petition, alleges that the water causing their damages migrates to their lot because the level of the water in the pond is higher than the level of their lot, and the pond was constructed in an area containing sandy, highly permeable soil, without using a liner or water barrier. During oral argument, the Palmas’ attorney explained that they did not claim that the water on their lot came from water that had overflowed the pond’s bank. The Palmas sought damages in an amount of not more than $1,000,000.

Prior to the trial court’s resolution of Chribran’s motion for summary judgment, the Palmas amended their complaint. Their fourth amended petition alleges five claims against Chribran, the sole appellee in the matter now before us. Two of the Palmas’ claims allege that Chri-bran violated section 11.086 of the Texas Water Code, which prohibits any person from diverting or impounding the natural flow of surface water. See Tex. Water Code Ann. § 11.086 (West 2008). The Pal-mas’ fourth amended petition also alleges that Chribran negligently constructed the pond, that Chribran’s construction of the pond created a nuisance, and that Chri-bran is liable based on a claim for negligent trespass. Approximately twenty-one months after the Palmas initially filed their suit, Chribran filed a no-evidence motion for summary judgment under Rule 166a(i) of the Texas Rules of Civil Procedure. Chribran’s motion for summary judgment, in part, alleged that there was no evidence that Chribran’s acts or omissions caused the Palmas’ alleged damages.

The Palmas filed a response to Chri-bran’s motion. The Palmas’ response asserts that their summary-judgment evidence is sufficient to raise an issue of fact on the element of whether Chribran’s construction of the pond had caused them to suffer damages. Without stating a basis for its ruling, the trial court granted Chri-bran’s motion for summary judgment.

Standard of Review

We review a trial court’s decision to grant a no-evidence motion for summary judgment under the standards set forth in Rule 166a(i) of the Texas Rules of Civil Procedure. In essence, a no-evidence motion for summary judgment is the equivalent of a motion for a pretrial directed verdict. Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 581 (Tex.2006).

To defeat a no-evidence summary judgment motion, the non-movant must produce summary-judgment evidence sufficient to raise a genuine issue of material fact on each element of the claims that are being challenged by the movant. Tex.R. Civ. P. 166a(i); Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex.2004). The non-movant raises a genuine issue of material fact by producing “more than a scintilla of evidence” to establish the challenged element’s existence. Ford Motor Co., 135 S.W.3d at 600. More than a scintilla of evidence exists when the evidence is such that reasonable and fair-minded people can differ in their conclusions. Id. at 601. If “ ‘the evidence offered to prove a vital fact is so weak as to do no more than create a mere surmise or suspicion of its existence, the evidence is no more than a scintilla and, in legal effect, is no evidence.’” Id. (quoting Kindred v. Con/Chem, Inc., 650 S.W.2d 61, 63 (Tex.1983)). In determining whether the non-movant has produced more than a scintilla of evidence, we review the evidence in the light most favorable to the non-movant, and we give credit to such evidence if reasonable jurors could and disregard contrary evidence unless reasonable jurors could not. See Mack Trucks, 206 S.W.3d at 582.

“A summary judgment is not entitled to the same deference given to a judgment following a trial on the merits.” Bell v. Moores, 832 S.W.2d 749, 751 (Tex.App.Houston [14th Dist.] 1992, writ denied). We review a summary judgment de novo to determine whether the non-movant produced some evidence supporting the challenged elements of his claims. Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex.2005). When a trial court’s judgment granting a motion for summary judgment fails to specify the grounds upon which the court granted a summary judgment, we are required to affirm the summary judgment if any one of the independent summary-judgment grounds adr vanced in the motion for summary judgment defeats all of the plaintiffs’ claims. See Mack Trucks, 206 S.W.3d at 581-82; FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868, 872-73 (Tex.2000).

Causation

As pled, causation-in-fact is an element shared by all of the Palmas’ claims. See Tex. Water Code Ann. § 11.086(a), (b) (requiring damages to have been caused by a diversion of water); Union Pump Co. v. Allbritton, 898 S.W.2d 773, 775 (Tex.1995) (explaining that proof of cause-in-fact is required in negligence and products cases); Zapata v. Ford Motor Credit Co., 615 S.W.2d 198, 201 (Tex.1981) (noting that trespass claims, not involving an owners’ loss of use of his property for a substantial period of time, require proof of damages caused by the trespass); Aguilar v. Trujillo, 162 S.W.3d 839, 850 (Tex.App.-El Paso 2005, pet. denied) (identifying causation as an element of a nuisance claim). To establish that an event is the cause-in-fact of the injured party’s damages, the plaintiff must establish that the defendant’s “act or omission was a substantial factor in bringing about the injuries, and without it, the harm would not have occurred.” IHS Cedars Treatment Ctr. of DeSoto, Tex., Inc. v. Mason, 143 S.W.3d 794, 799 (Tex.2004); Union Pump, 898 S.W.2d at 775 (“Common to both proximate and producing cause is causation in fact, including the requirement that the defendant’s conduct or product be a substantial factor in bringing about the plaintiffs injuries.”).

All of the Palmas’ claims are based on their assertion that the excess water on their lot had been caused by Chribran’s construction of a pond located approximately four blocks to the northeast of the Palmas’ home. The pond was constructed in 2004 during Chribran’s initial development of the subdivision. The Palmas contend that the construction of the pond allows water to “flow through the sandy soil from the pond to the lower elevations in the area.” Joe’s affidavit, attached to the Palmas’ summary-judgment evidence, contains his opinion that the water collects in the pond and then migrates from the pond to his lot forcing water to come up from beneath the ground and surface on his property. A grading and drainage plan, also included in the summary judgment proof, reflects that for water to migrate to the Palmas’ home from the pond, water would be required to pass or be affected beneath Tarrytown Crossing Drive, Jefferson Crossing Drive, and Perkins Crossing Drive before affecting the north side of Highland Crossing Drive, the street on which the Palmas live. Construing the Palmas’ pleading liberally, we also consider that Joe’s affidavit, which states that “water wells up continuously, as though from a babbling brook through the silty, sandy soil[,]” to imply that water absorbed in the area of the pond affects the depth of the water table below his lot.

Analysis

Because the trial court could grant Chribran’s summary-judgment motion on all of the Palmas’ claims based on Chri-bran’s contention that no evidence supported a claim that the construction of the pond caused the excess water to appear on the Palmas’ lot, we first address the Pal-mas’ evidence on causation. The Palmas rely on Joe’s affidavit to establish that the construction of the pond had caused excess water to appear on their lot. With respect to causation, the Palmas’ brief points us to the following portion of Joe’s affidavit, in which he states:

It is my experience as a layman that water flows from higher points to lower points. [For] almost 4 years, I have personally watched the continuously flowing water streaming across my driveway, staining the concrete!,] and soaking my neighbors’ yards to the point that they sink ankle-deep in mud when they step onto grass. Every day, I see water weeping from expansion joints in the streets and flowing downhill at the lower elevations in [the subdivision]. By visual inspection, I can tell that the level of the water in the Chribran pond is higher than the elevation of my home and the other homes exhibiting similar problems. I know from the sworn testimony of Wes Tipton, the Supreme Builders!’] sales representative who sold me my home and who personally saw Chribran constructing the pond, that no concrete or other impermeable liner was constructed when Chribran built the earthen dam [that] holds the pond. Therefore, I conclude that the source of the upwelling water in the lower elevations of [the subdivision] and at my home is the nearby Chribran pond.

While the Palmas recognize that Joe is not a trained geologist, they contend that the excess water on their property is logically traceable to Chribran’s construction of the pond, and that general experience and common sense established, within a reasonable degree of probability, the relationship between the pond and the appearance of excess water on their lot.

While proof other than expert testimony is allowed in some situations, the cases the Palmas cite do not involve a layperson testifying about how fluids migrate below the earth’s surface. Since Joe’s opinion is the sole opinion contained in the summary-judgment evidence on the element of cause-in-fact, an element that all of his claims share, we must determine whether Joe’s lay opinion constitutes any evidence that would support his claim that Chri-bran’s pond had caused their damages.

Given the location of the Palmas’ lot, the water from Chribran’s pond would necessarily be required to travel a distance of approximately three football fields to migrate to the Palmas’ lot, or to otherwise have caused an effect on the water table over that same distance. While laypersons certainly know that water flows downhill, whether water continues flowing downhill after being absorbed into the ground is not a matter that is apparent or within the common experience of laypersons. Nor does a layperson’s general experience and common knowledge extend to determining how water travels beneath the ground over the distance that is involved here. Finally, laypersons do not possess a general understanding of where the water tables are located under property nor how adding water to one end of the table might affect areas elsewhere. Under the circumstances presented here, we conclude that the subject of how water travels after being absorbed by the ground and the subject of how water that the ground absorbs affects the water table are subjects beyond the general understanding and common knowledge of lay witnesses.

Additionally, the Palmas’ evidence fails to demonstrate a close connection between the filling of the pond and the problems the Palmas experienced on their lot. The Palmas purchased the property in 2005, and Joe’s affidavit reflects that he first noticed water weeping from expansion joints in the streets “almost immediately after” they purchased their home. The summary-judgment record is silent about the water conditions existing on the Pal-mas’ lot before Chribran’s construction of the pond. As a result, Joe’s affidavit, stating that he first noticed the water seeping from the joints in streets and driveways shortly after purchasing the home, fails to shed light on whether a temporal connection exists between the pond’s construction and the water on the Palmas’ lot.

For these reasons, we conclude that the Palmas were required to present expert testimony to establish that a fact issue existed with respect to whether the construction of the pond was the cause-in-fact of the excessive water on their lot. After the Palmas filed their summary-judgment response, Chribran lodged objections to Joe’s affidavit on the basis that the opinions he offered were not based upon general experience and common sense. Approximately four months passed between the date that Chribran lodged its objections to Joe’s affidavit and the date that the trial court granted Chribran’s motion for summary judgment. Thus, the Palmas had ample time to supplement the record with competent summary-judgment evidence of causation prior to the trial court’s resolution of the motions if such evidence existed.

In summary, Joe’s opinions on causation are not supported by a proper basis and thus are wholly conclusory; therefore, his opinions cannot be considered probative evidence. City of San Antonio v. Pollock, 284 S.W.3d 809, 818 (Tex.2009) (concluding that if basis offered for an opinion provides no support, “the opinion is merely a con-clusory statement and cannot be considered probative evidence”). The summary-judgment record contains no evidence from an expert in the field of hydrology or from an expert qualified in any other scientific field relevant to the study of the underground movement of water. Because the Palmas failed to establish the existence of a genuine issue of material fact as to causation, the trial court properly granted Chribran’s no-evidence motion for summary judgment. See Mack Trucks, 206 S.W.3d at 583-84 (rendering judgment for the defendant where lay testimony failed to raise a fact issue as to cause-in-fact).

Conclusion

The Palmas produced no competent evidence proving that water in Chribran’s pond had caused their damages. Because causation is a required element of each of the Palmas’ claims, the trial court properly granted Chribran’s no-evidence motion for summary judgment. We overrule each of Palmas’ six issues and affirm the judgment of the trial court.

AFFIRMED.

      . After the trial court granted Chribran’s motion for summary judgment, it severed the Palmas’ claims against Chribran into a separate cause number, making the trial court’s judgment final for purposes of appeal. See Martinez v. Humble Sand & Gravel, Inc., 875 S.W.2d 311, 312 (Tex.1994) (stating that a judgment in a case involving multiple parties may be made final as to some of the parties for purposes of appeal by the trial court’s "severing the causes and parties disposed of by the judgment into a different cause”).

      . " 'The gist of trespass to personalty is an injury to, or interference with, possession, unlawfully, with or without the exercise of physical force.' ” Mountain States Tel. & Tel. Co. v. Vowell Constr. Co., 161 Tex. 432, 341 S.W.2d 148, 150 (1960) (quoting 87 C.J.S. Trespass §§ 8, 9). Thus the intentional entry of a scraper into a space lawfully occupied by a cable was held to be a "violation of a property right which gave rise to a cause of action regardless of negligence.” Id. Because we focus on an element common to all of the Palmas’ claims, we need not determine whether the Palmas’ claim for negligent trespass differs from the type of trespass claim recognized in Mountain States.

      . The cases on which the Palmas rely concerning lay opinion are Guevara v. Ferrer, 247 S.W.3d 662, 667-70 (Tex.2007) (holding that non-expert evidence of the plaintiffs state of general health before the wreck as compared to his physical condition afterwards was sufficient to allow a layperson of common knowledge and experience to conclude that his wreck made it necessary to transport the plaintiff to an emergency room and be physically examined while there); Morgan v. Compugraphic Corp., 675 S.W.2d 729, 733 (Tex.1984) (lay testimony held sufficient to establish causation where record established that the plaintiff, before being exposed to fumes, had been in good health, but after a period of four or five days of constant exposure, developed symptoms such as watering eyes, blurred vision, headaches, and swelling of breathing passages); Hood v. Phillips, 554 S.W.2d 160, 165-66 (Tex.1977) (noting that in medical malpractice cases, unless the mode or form of treatment is a matter of common knowledge or within the layman’s experience, expert testimony is required to prove that the physician has undertaken a mode of treatment that a reasonably prudent physician would not have undertaken under similar circumstances); Lenger v. Physician's Gen. Hosp., Inc., 455 S.W.2d 703, 706, 708 (Tex.970) (noting rule that jurors can decide some questions of causation based on their common experience, but then rejecting plaintiff’s argument that the jury should be permitted to decide whether eating after surgery had caused the plaintiff to suffer post-surgical complications); Ins. Co. of N. Am. v. Kneten, 440 S.W.2d 52, 53 (Tex.1969) (in a workers' compensation case, holding that prompt onset of heart attack within a few minutes of electric shock allowed laypersons to infer that a heart attack was related to an on-the-job injury in a case where a physician testified that the incident could have precipitated the heart attack); Parker v. Employers Mut. Liab. Ins. Co. of Wis., 440 S.W.2d 43, 46 (Tex.1969) (noting in a workers’ compensation case that, while causation can be determined by juries where general experience or common sense allow reasonable persons to know or anticipate that an event is generally followed by another event, laypersons did not have such general knowledge or experience in a case concerning the causation of cancer); Choice v. Gibbs, 222 S.W.3d 832, 836-37 (Tex.App.Houston [14th Dist.] 2007, no pet.) (expert medical testimony not required to establish that plaintiff was damaged when plaintiff experienced prompt onset of symptoms following his suffering an electrical shock).

      . “Hydrology” is “a science dealing with the properties, distribution, and circulation of water; specif: the study of water on the surface of the land, in the soil and underlying rocks, and in the atmosphere, particularly with respect to evaporation and precipitation[.]” Webster's Third New International Dictionary 1109 (2002).