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Alliance Family of Companies v. Nevarez

Court of Appeals of Texas, Fifth District, Dallas

April 4, 2019

ALLIANCE FAMILY OF COMPANIES AND JUSTIN MAGNUSON, Appellant
v.
JAMISHA NEVAREZ, Appellee

          On Appeal from the 192nd Judicial District Court Dallas County, Texas Trial Court Cause No. DC-18-01162

          Before Justices Whitehill, Molberg, and Reichek

          MEMORANDUM OPINION

          AMANDA L. REICHEK, JUSTICE

         In this interlocutory appeal, Alliance Family of Companies and Justin Magnuson appeal the trial court's order denying their motion to compel arbitration of a suit brought against them by Jamisha Nevarez. In a single issue, appellants generally contend the ruling was error because (1) there is a valid arbitration agreement, (2) appellee's claims fall within the scope of the agreement, and (3) appellee failed to raise an effective affirmative defense to application of the agreement. We conclude appellee's claims fall outside the scope of the arbitration agreement; accordingly, we affirm the trial court's order.

         Factual Background

         Alliance Family of Companies is a diagnostic testing facility that provides neurodiagnostic, cardiac, and sleep testing. Magnusson is its chief executive officer. In November 2016, appellants hired appellee as Magnusson's personal assistant. Six months later, she signed two nondisclosure agreements, one with AFC and the other with Magnusson. In each of the NDAs, appellee agreed she would not "directly, indirectly or in any manner whatsoever, use, disseminate, disclose or publish" AFC's or Magnusson's confidential information. Confidential information was defined differently in each agreement.

         With respect to AFC, confidential information was defined as "any and all technical and non-technical information provided to [appellee] by AFC," and included, among other things, "personal and/or business entity contacts of any type whatsoever relating in any manner whatsoever to AFC and/or to Justin Magnuson . . .." As to Magnusson, confidential information was defined as "any and all information provided to or discovered by [appellee] regarding [Magnusson], and included, among other things, "personal and/or business contacts; personal and/or business activities; . . . business and/or personal contacts and/or activities of any type whatsoever relating in any manner whatsoever to [Magnusson]." Both NDAs also contained identical alternative dispute resolution clauses that called for "[a]ny dispute under this Agreement" to be subject to arbitration in the event mediation was unsuccessful.

         In January 2018, appellee sued appellants alleging causes of action for assault, sexual assault, and battery. She alleged the events giving rise to her causes of action occurred after Magnusson called her to his home. She alleged AFC was directly liable because Magnusson was acting at such time as a principal or vice principal of AFC and because AFC failed to provide a safe workplace. She also alleged AFC was vicariously liable for Magnusson's conduct.

         Appellants filed a joint motion to compel arbitration, asserting appellee's claims were "squarely covered" by the arbitration clauses of the NDAs because appellee alleged the assault, sexual assault, and battery occurred in the course and scope of both Magnusson's and her employment. Attached to the motion were copies of the NDAs, Magnusson's declaration stating that he witnessed appellee sign the agreements, and heavily redacted emails between the parties regarding settlement and mediation.

         In response to the motion, appellee argued there was not a valid arbitration agreement because there was no consideration to support the NDAs, no meeting of the minds that sexual assault could not be disclosed, and the arbitration clauses were unconscionable. Additionally, she asserted that even if the agreements are valid, the claims raised in her petition are not covered by them.

         The trial court conducted a hearing and subsequently denied appellants' motion to compel without stating a basis. [1] This appeal followed.

         Applicable Law

         We review a trial court's order denying a motion to compel arbitration for an abuse of discretion. Henry v. Cash Biz, LP, 551 S.W.3d 111, 115 (Tex. 2018).[2] We defer to the trial court's determinations if they are supported by evidence but review its legal determinations de novo. Id. Whether the claims in dispute fall within the scope of a valid arbitration agreement is a question of law. Id.

         Courts may require a party to submit a dispute to arbitration only if the party has agreed to do so. See Seven Hills Commercial, LLC v. Mirabel Custom Homes, Inc., 442 S.W.3d 706, 714 (Tex. App.-Dallas 2014, pet. denied). A party seeking to compel arbitration must establish a valid arbitration agreement exists and that the claims asserted are within the scope of the agreement. Id. at 715. To determine whether a party's claims are within the scope of an arbitration agreement, we focus on the factual allegations and not on the legal causes of action asserted. Inre FirstMerit Bank, N.A., 52 S.W.3d 749, 754 (Tex. 2001). We resolve any doubts about the factual scope in favor of arbitration. Id. Although both Texas and federal policy strongly favor arbitration, that policy "cannot serve to stretch a contractual clause beyond ...


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