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Hawdi v. Mutammara

Court of Appeals of Texas, First District

July 30, 2019


          On Appeal from the 240th District Court Fort Bend County, Texas Trial Court Case No. 16-DCV-236345

          Panel consists of Justices Lloyd, Kelly, and Hightower.



         This is an appeal from a final judgment confirming an arbitration award. Appellant Mahasin A. Hawdi is the wife of William B. Mutammara, who currently resides in a senior assisted living and memory care facility. Mahasin is 78 years old, and William is 88 years old. Atheel Mutamarra is William's adult son, Mahasin's stepson, and the holder of financial and medical powers of attorney for William.

         Before their marriage in 2007, Mahasin and William signed a premarital agreement that set forth provisions regarding the characterization of and rights to manage their assets during and after their marriage. This agreement included an arbitration provision. In 2016, a dispute arose between Atheel and Mahasin regarding ownership and use of property that Atheel contended was his father's separate property. Atheel sought arbitration under the premarital agreement to obtain "a declaration of the rights, duties, and obligations" of each spouse under the agreement, the imposition of a constructive trust over William's separate property that was allegedly possessed by Mahasin, and injunctive relief to preserve William's assets. Mahasin opposed arbitration, but the trial court granted Atheel's motion to compel arbitration. Atheel later sought confirmation of the arbitration award, and the trial court entered a final judgment.

         On appeal, Mahasin raises seven issues. Four issues challenge the trial court's order compelling arbitration, and three issues challenge the arbitration award as included in the final judgment. We affirm.


         Before Mahasin and William married, they signed a premarital agreement. They stipulated that their intent was "to clarify their respective property rights to eliminate any uncertainty about those rights." The agreement identified what would comprise each party's separate property upon marriage, and it provided that "[e]ach party will have the full, free, and unrestricted right to manage the separate property over which he or she has control."[1] It also provided that "[n]either party will have the authority to encumber or dispose of the other party's separate property without the other party's express written consent."

         The agreement also provided for "binding arbitration" "in accordance with Texas arbitration law.":

The parties agree to submit to binding arbitration any dispute or controversy regarding the validity, interpretation, or enforceability of this agreement, as well as all issues involving its enforcement in connection with a dissolution proceeding between the parties. Each party expressly waives any right to trial by a court or trial by a jury. If a dissolution proceeding or declaratory judgment proceeding is filed in Texas, the arbitrator appointed under this agreement will simultaneously be designated as special master under the Texas Rules of Civil Procedure, and the parties agree to jointly apply to the court for any orders that are necessary to vest the arbitrator with all powers and authority of a special master under the rules.
The parties agree to appoint one arbitrator, whose decisions will be binding in all respects. Any arbitrator appointed by the parties must be an attorney who (i) has undergone arbitration training conducted by the American Bar Association or the American Academy of Matrimonial Lawyers and (ii) is in good standing with the State Bar of Texas. The first party requesting arbitration must designate the name of an arbitrator in the request. The other party must then designate the name of an arbitrator. If the parties cannot agree on an arbitrator within fourteen days after either party's written request for arbitration, the two designees must select a qualified arbitrator, who will be designated the sole arbitrator of the dispute. If the parties cannot agree on the ground rules and procedures to be followed during the arbitration proceedings, the arbitrator shall have the sole authority to establish the ground rules and procedures to be followed during the arbitration proceeding. The parties agree to attend the arbitration on the date and at the time and place set by the arbitrator. The cost of arbitration must be borne as the arbitrator directs. The award of the arbitrator will be binding and conclusive on the parties, and a judgment setting forth the arbitration award may be entered in any court of competent jurisdiction.

(Emphasis added.)

         Six years after the premarital agreement was signed and while Mahasin was out of town, William signed a statutory durable power of attorney in favor of Atheel. Six weeks later, William was diagnosed with Alzheimer's Disease. Two years later, in July 2015, while Mahasin was recovering from a serious accident, Atheel placed William in a senior assisted-living memory-care facility, where he remains. Disputes arose between Mahasin and Atheel regarding access to William and financial matters, including occupation of the marital residence.

         About a year later, Atheel requested arbitration in writing, designated Bruce Wayne Wettman as arbitrator, and informed Mahasin that she had 14 days to "agree to an arbitrator." Mahasin neither replied nor objected to Atheel's designation of Wettman as arbitrator. Atheel filed with the district court an application to compel arbitration designating Wettman as arbitrator. He later amended the application, attaching a copy of the premarital agreement. Mahasin opposed arbitration asserting that Atheel lacked standing to enforce the arbitration clause.

         The parties unsuccessfully mediated before Wettman. The trial court granted the amended application to compel arbitration, specifically finding that: (1) the existence of an agreement to arbitrate is undisputed; (2) Mahasin "nevertheless refuses to arbitrate"; (3) "the arbitration agreement contains a delegation clause whereby the parties to the arbitration agreement intend for the arbitrator to decide gateway matters regarding the validity, interpretation or enforceability of the arbitration agreement, and all other legal and factual matters"; and (4) Mahasin failed to raise any valid defenses to the arbitration agreement. The court ordered arbitration "with the designated arbitrator" and retained jurisdiction "to appoint an arbitrator" "should the agreed method of appointment fail."

         After arbitration was conducted, Wettman entered an award. Wettman found that when they signed the premarital agreement, Mahasin and William acknowledged that they "had or reasonably could have had full and complete knowledge of property owned by the other party." The arbitrator also found that Mahasin had entered into the premarital agreement knowingly and voluntarily and that she declined to retain independent counsel despite having had the opportunity to do so. The arbitrator found that the marital home was William's separate property because it was "purchased entirely with cash" that was William's separate property. The arbitrator also found that Mahasin had withdrawn nearly $300, 000 from an investment account that was solely William's separate property and put the money in other accounts for her personal living expenses. The arbitrator awarded Atheel $172, 000 plus 6% postjudgment interest. He also ordered that Mahasin had the right to continue living in the marital home and that Atheel could conduct one inspection per month "at a mutually agreeable date and time." The parties were ordered to pay their own costs and attorneys' fees.

         Atheel filed an application with the court to confirm the award. Mahasin objected and sought to vacate the arbitration award. She argued that the arbitrator improperly exceeded his powers under the Texas Arbitration Act by finding that the marital home was William's separate property. She argued that when a spouse uses separate property to acquire real property during a marriage and takes title in both spouses' names, Texas law presumes that the nonpurchasing spouse has received a gift of a one-half interest in the property. She attached a copy of the deed to her objection and application to vacate. Mahasin made no argument about the money transferred from the investment account, and she made no argument about the proper characterization of the property under the parties' premarital agreement.

         The trial court entered a final judgment confirming the arbitration award, and Mahasin appealed.


         Mahasin raised seven issues on appeal. Some relate to the order compelling arbitration, and others relate to the final judgment confirming the arbitration award.

         I. Issues relating to the order compelling arbitration

         An order compelling arbitration may be reviewed in an appeal from the final judgment. See Perry Homes v. Cull, 258 S.W.3d 580, 586 n.9 (Tex. 2008). We review a trial court's ruling on a motion to compel arbitration for an abuse of discretion, deferring to the trial court's factual determinations that are supported by evidence and examining questions of law de novo. ...

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