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Fitness Entertainment Ltd. v. Hurst

Court of Appeals of Texas, Eighth District, El Paso

September 6, 2017

FITNESS ENTERTAINMENT LTD, Appellant,
v.
BRIAN HURST, Appellee.

         Appeal from the 243rd District Court of El Paso County, Texas (TC# 2015-DCV-0357)

          Before McClure, C.J., Rodriguez, and Hughes, JJ.

          OPINION

          ANN CRAWFORD McCLURE, Chief Justice.

         Brian Hurst filed an employment discrimination and retaliation suit against Fitness Entertainment, Ltd. doing business as Planet Fitness. The trial court heard and denied Planet's motion to stay proceedings and compel arbitration. Planet appeals the trial court's denial of its motion, and complains that the trial court provided insufficient notice that an evidentiary hearing would be conducted.

         FACTUAL SUMMARY

         Planet filed its motion to stay proceedings and compel arbitration on June 15, 2015. Affixed to its motion is a document entitled, "Employment, Non-Competition Agreement and Arbitration Agreement." The last page of the document bears only Hurst's printed name as "employee, " a signature, a black box positioned over a line for a social security number, and information consisting of an address, telephone numbers, and emergency contact person. The last page also bears an unsigned signature block for "Gym Management Corp., and/or JB4 Fitness Management, Ltd., d/b/a Planet Fitness® ('EMPLOYER')" followed by the name and signature line for "Joseph Bencomo, " which is unsigned, and a line for inserting a date, which is blank. On July 7, 2015, the trial court set a hearing on the motion for July 16, 2015.

         At 5:37 p.m. on July 15, 2015, Hurst filed his response. He asserted that he did not at any time during his employment acknowledge or agree to the purported arbitration agreement, and refuted its existence and validity. He also alleged that Planet had failed to satisfy its burden of establishing the existence of a valid arbitration agreement pursuant to traditional contract principles, and objected on grounds of lack of authenticity, hearsay, and the best evidence rule because Planet had not produced the original document that Hurst had purportedly executed.

         In support of his response, Hurst affixed his sworn affidavit in which he attested that during the period of his employment he did not sign an arbitration agreement. Referring to the "Employment, Non-Competition Agreement and Arbitration Agreement" attached to the motion to compel, Hurst declared that although his signature appears on the last page of the document, the pages preceding his signature are "replacements of some other document" he signed and that "someone attached the last page with my signature to the purported arbitration agreement" that he had not signed. Hurst noted that the documents he signed had a larger heading on the first page, greater spacing between the lines, and did not include an arbitration agreement.

         At the hearing, Planet argued that the arbitration agreement was subsumed within the larger employment agreement, and that Hurst's affidavit was insufficient to show that he did not agree to arbitrate his claims. Planet also noted that its motion included an affidavit from another employee who swore that the arbitration agreement is signed by all employees and was signed by Hurst. Counsel represented to the trial court that there is no other agreement signed by Hurst and that Hurst had presented no evidence that the arbitration provisions had been inserted into another document Hurst had signed. Planet did not call any witnesses.

         In response, Hurst's counsel referred the trial court to Section 171.021(b) of the Civil Practice and Remedies Code, and noted that if the non-movant produces evidence controverting the existence of a valid arbitration agreement, the trial court is required to conduct an evidentiary hearing. See Tex. Civ. Prac. & Rem. Code Ann. § 171.021(b)(West 2011). Counsel then announced that he intended to call Hurst to testify. He also lodged objections based on hearsay and the best evidence rule because Planet had failed to present the original document.

         Planet countered that hearings to compel arbitration track those of a motion for summary judgment. If a material fact is at issue, the trial court may conduct an evidentiary hearing. It then argued that this hearing was not evidentiary in nature. Hurst had not presented evidence to support his hearsay objection, and the affidavit was made on the personal knowledge of the affiant. The trial court sustained the hearsay objection and explained, "If there's an exception, that's how you get it in." The trial court then noted:

What I'm hearing is - he is saying, ["]We've raised evidence contesting the admission of that affidavit.["] You say, at that point, ["]it warrants an evidentiary hearing.["]

         To this, Planet responded, "Right." Planet then argued that Hurst had not presented evidence contesting the fact that he had signed the arbitration agreement. The trial court observed, "I'm assuming he's going to contest it. You know what? Just do it."

         Planet lodged no objection in advance of Hurst's testimony. Hurst testified that Planet had never presented an arbitration agreement to him and that he had never signed one. Although he acknowledged that his signature appeared on the last page of the document, he claimed that he had signed a ...


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