Court of Appeals of Texas, Third District, Austin
THE DISTRICT COURT OF TRAVIS COUNTY, 353RD JUDICIAL DISTRICT
NO. D-1-GN-13-000677, HONORABLE TIM SULAK, JUDGE PRESIDING
Justices Puryear, Goodwin, and Bourland.
Olson Bourland, Justice.
an appeal from the trial court's denial of a motion to
compel arbitration and stay proceedings filed by appellant
Santander Consumer USA, Inc. The trial court granted the
motion as to appellee Mario A. Mata and denied it as to the
remaining appellees, Centroplex Automobile Recovery, Inc.;
Blake Thornton Vandusen; John F. Thompson d/b/a Centroplex
Automobile Recovery, Inc.; and Redshift Investigation, Inc.
Santander appeals from the trial court's order. For the
reasons that follow, we will affirm.
December 2002, Mata financed the purchase of a Chevrolet
Suburban pursuant to a motor-vehicle retail installment
contract (Sale Contract). As part of the purchase transaction,
Mata pledged the vehicle as collateral to secure the debt.
Mata and a predecessor of Santander amended the Sale Contract
in January 2009, dropping the interest rate from 12.82% to 4%
per year and adding an arbitration provision governed by the
Federal Arbitration Act. It is undisputed that no other party
saw or signed the original or amended Sale Contract.
Redshift and Centroplex are in the collateral-recovery
business. Redshift contracts with financial institutions like
Santander to recover secured collateral. Relevant to this
case, Redshift has a December 2002 Service Agreement (Service
Agreement) with Santander relating to the recovery of secured
collateral. There is no arbitration provision in the Service
Agreement. In turn, Redshift entered into a contract with
Centroplex for Centroplex to carry out repossession
assignments requested by Redshift pursuant to the terms of a
June 2010 Collateral Recovery Agreement between Redshift and
2011, Santander ordered repossession of the vehicle purchased
by Mata. Redshift tasked Centroplex with the
collateral-recovery assignment, and Centroplex sent one of
its employees, Vandusen, to repossess the vehicle. Mata
allegedly sustained physical injuries during the course of
the repossession attempt, and he sued Santander for breach of
contract and all of the other parties for conversion,
common-law fraud, trespass, gross negligence, and violations
of the Texas Deceptive Trade Practices Act.
asserted cross-claims against Redshift, Centroplex, Thompson,
and Vandusen for indemnification, contribution, and
proportionate responsibility. Vandusen asserted a
counter-claim against Santander and a cross-claim against
Redshift for indemnity and contribution. Redshift asserted
cross-claims against Centroplex for contribution, indemnity,
and breach of contract.
filed a motion to compel arbitration and stay proceedings,
requesting an order that Mata's claims against all
defendants be submitted to arbitration because, Santander
argues, all of Mata's claims arise out of or are related
to the Sale Contract containing the arbitration clause. After
an evidentiary hearing, the trial court granted the motion
with regard to the claims between Mata and Santander and
denied the motion as to the other claims and parties. This
sole issue on appeal, Santander contends that the trial court
erred by denying the motion to compel arbitration and stay of
proceedings as to Centroplex, Vandusen, Thompson, and
Redshift. In reviewing the denial of a motion to compel
arbitration, we use an abuse-of- discretion standard, and
within that standard, we defer to the trial court's
factual determinations if they are supported by the evidence
and review the trial court's legal determinations de
novo. See In re Labatt Food Servs., L.P., 279 S.W.3d
640, 642-43 (Tex. 2009) (orig. proceeding); Oak Crest
Manor Nursing Home, LLC v. Barba, No. 03-16-00514-CV,
2016 WL 7046844, at *2 (Tex. App.-Austin Dec. 1, 2016, no
pet.) (mem. op.); Sidley Austin Brown & Wood, L.L.P.
v. J.A. Green Dev. Corp., 327 S.W.3d 859, 863 (Tex.
App.-Dallas 2010, no pet). Whether the parties agreed to be
bound to an arbitration agreement is a contract-formation
question that we review de novo, deferring to the trial
court's findings of historical fact as between the
parties as long as those determinations are supported by the
evidence. See Oak Crest, 2016 WL 7046844, at *2. A
party seeking to compel arbitration under the Federal
Arbitration Act (FAA) must establish that (1) there is a
valid agreement to arbitrate, and (2) the claims raised are
within the agreement's scope. In re Kellogg Brown
& Root, Inc., 166 S.W.3d 732, 737 (Tex. 2005) (orig.
there is no dispute (other than Mata's unpreserved claim)
that there was a valid agreement to arbitrate between
Santander and Mata, and there is no dispute that Centroplex,
Vandusen, Thompson, and Redshift (the nonsignatory
defendants) were not parties to the Sale Contract containing
the arbitration provision, did not agree to it, and did not
sign it. Thus, the issue here is whether Santander is
entitled to compel non-signatories to participate in
arbitration on the basis of the agreement between Mata and
apply Texas procedural rules and substantive law in
determining whether nonsignatories are bound by an
arbitration agreement. See In re Labatt Food Servs.,
279 S.W.3d at 643. Whether an arbitration agreement binds a
nonsignatory is a gateway matter to be determined by the
court rather than the arbitrator. See In re Weekley
Homes, L.P., 180 S.W.3d 127, 130 (Tex. 2005) (orig.
proceeding). The party seeking arbitration bears the burden
of establishing that the arbitration agreement binds a
nonsignatory. See Glassell Producing Co. v. Jared Res.,
Ltd., 422 S.W.3d 68, 81 (Tex. App.-Texarkana 2014, no
pet.); In re Citgo Petroleum Corp., 248 S.W.3d 769,
776 (Tex. App.-Beaumont 2008, orig. proceeding).
Nonsignatories to an agreement subject to the FAA may be
bound to an arbitration clause when rules of law or equity
would bind them to the contract generally. In re Labatt
Food Servs., 279 S.W.3d at 643. According to principles
of contract and agency law, arbitration agreements may bind
nonsignatories under any of six theories: (1) incorporation
by reference, (2) assumption, (3) agency, (4) alter ego, (5)
equitable estoppel, and (6) ...