Appeal from the 133rd District Court Harris County, Texas
Trial Court Cause No. 2014-42950
consists of Justices Christopher, Brown, and Wise.
appeal from a judgment confirming an arbitration award, the
issues are whether the trial court erred by failing to modify
the award and its own judgment; and whether we, in our own
discretion, should grant a motion for sanctions under Rule
45. Finding no error, we affirm the trial court's
judgment and deny the motion for sanctions.
Rassouli founded a successful company, which he later sold to
National Signs Holding, LLC. The sale culminated in the
execution of two contracts that are pertinent here: first, an
Interest Purchase Agreement, which conveyed the old company
to the new company; and second, an Employment Agreement,
which established the terms of Rassouli's position as an
executive with the new company.
months of the conveyance, Rassouli was terminated from his
executive position. Rassouli sued the new company, a related
entity, and a related individual (collectively,
"National"). National countersued, and the parties
mutually agreed to submit their claims to binding
arbitrator issued an award addressing multiple subjects. We
highlight only two of those subjects here.
the arbitrator found that National had terminated Rassouli
without cause, which meant that Rassouli was entitled to
certain compensation. The arbitrator articulated a formula
for arriving at this compensation, but she did not determine
the dollar amount that was due under that formula. Instead,
the arbitrator left the parties to determine the dollar
amount for themselves. The arbitrator also provided that if
the parties could not stipulate to the dollar amount within
thirty days, then she could resolve the dispute on the
submission of written evidence.
the arbitrator found that Rassouli was bound by valid
noncompetition obligations under both the Interest Purchase
Agreement and the Employment Agreement. Regarding the
Interest Purchase Agreement, the arbitrator declared that the
non-competition obligation ran for the five-year period
between January 1, 2012 and January 1, 2017. Regarding the
Employment Agreement, the arbitrator declared that the
non-competition obligation ran for the two-year period
between August 26, 2012 and August 26, 2014.
side was satisfied with the award. National filed an
application with the trial court to modify the award, arguing
that the arbitrator had made an evident miscalculation or an
evident mistake concerning Rassouli's non-competition
obligation under the Employment Agreement. National asserted
that the noncompetition period should run for five years
under the plain terms of that agreement, rather than the two
years that were cited in the award. National asked the trial
court to correct that portion of the award or, in the
alternative, to delete that portion of the award, claiming
that the duration of the non-competition obligation had not
even been submitted to the arbitrator.
filed an application with the trial court that also focused
on the noncompetition obligation. Citing a separate provision
in the Employment Agreement, Rassouli argued that the
non-competition obligation was nullified when National
terminated him without cause. Rassouli accordingly asked the
trial court to vacate or modify the award, or simply to refer
the matter back to the arbitrator so that she could correct
the award herself.
sides moved for summary judgment, with each side arguing that
the other's application should be dismissed with
prejudice because the relief requested was unavailable as a
matter of law. The trial court granted both motions on
separate dates and in separate orders. The second order did
not contain language stating that it finally disposed of all
parties and claims, but when combined with the first order,
it appeared to have that effect. Indeed, Rassouli filed a
notice of appeal, apparently believing that the second order
was final and appealable.
the trial court lost its plenary power, National moved the
trial court to enter a new judgment that "complie[d]
with the controlling statutes." In a footnote, National
referred to two statutes under the TAA, but National did not
explain what those statutes required or even how the trial
court had failed to comply with them. National appeared to
suggest that the trial court still needed to confirm the
arbitration award, which both statutes mandate under certain
trial court granted National's motion and signed an order
saying that it "will enter a final judgment that . . .
complies with the controlling statutes." Despite that
order, the trial court did not enter a new judgment or
confirm the award. Thus, the parties proceeded with their
brief before this court, Rassouli argued that the arbitration
award was defective because it was not final. This point
focused on the compensation issue, which Rassouli had not
challenged in his application to the trial court. Rassouli
argued that the award contained "a blank" because
the dollar amount had not been determined. Rassouli also
explained that the parties had attempted to resubmit the
compensation issue to the arbitrator, but the arbitrator
expressed reluctance to do anything further without a court
order authorizing her jurisdiction.
responded that the compensation issue was ministerial, and
that an appellate court could resolve the issue on its own.
In a cross-appellant's brief, National argued that the
trial court had erred by failing to modify the portion of the
award addressing Rassouli's non-competition obligations.
National also argued that the trial court had erred by
failing to confirm the award as required by the TAA.
case submitted with oral argument before a different panel of
this court, and that panel promptly abated the appeal because
it was uncertain about its own appellate jurisdiction. The
panel requested the trial court to clarify its intent to
finally dispose of all parties and claims through its
summary-judgment order. The panel instructed the trial court
that it could modify this order by expressly making it final
and appealable, if modification were necessary. The panel
also indicated that the trial court could consider any
additional requests for relief presented by the parties,
including a motion to confirm the arbitrator's award.
before the trial court, National moved to enter a new
judgment confirming the award, and Rassouli moved to refer
the case back to the arbitrator. The trial court granted
Rassouli's motion. In its referral order, the trial court
authorized the arbitrator to make a final determination on