Fourth Court of Appeals
San Antonio, Texas
DISSENTING OPINION
No. 04-16-00644-CV
UTILITY TRAILER SALES SOUTHEAST TEXAS, INC.,
Appellant
v.
Hector L. LOZANO and Mary E. Short,
Appellees
From the 341st Judicial District Court, Webb County, Texas
Trial Court No. 2015CVT003881 D3
Honorable Rebecca Ramirez Palomo, Judge Presiding
Opinion by: Marialyn Barnard, Justice
Dissenting Opinion by: Irene Rios, Justice
Sitting: Sandee Bryan Marion, Chief Justice
Marialyn Barnard, Justice
Irene Rios, Justice
Delivered and Filed: July 19, 2017
I respectfully dissent from the majority opinion holding the trial court improperly denied
Utility Tractor Sales Southeast Texas, Inc.’s (“UTS”) motion to compel arbitration.
Lozano signed the 2010 Arbitration Agreement when his first term of employment began
with UTS in May 2010. That term of employment ended in October 2012. In May 2013, Lozano
began a second term of employment with UTS. UTS’s representative testified all new employees
are required to sign an arbitration agreement and that UTS considered Lozano to be a “new
employee” when he began his second term of employment. However, for unexplained reasons,
the record does not show that Lozano signed an arbitration agreement when he was rehired by
Dissenting Opinion 04-16-00644-CV
UTS in 2013. Lozano was injured on the job in 2014 and subsequently brought suit against UTS.
UTS then sought to compel arbitration.
To compel arbitration, UTS was required to provide evidence of a valid arbitration
agreement and establish that Lozano’s claim fell within the scope of that agreement. See In Estate
of Guerrero, 465 S.W.3d 693, 703 (Tex. App.—Houston [14th Dist.] 2015, pet. denied). In
determining whether a claim falls within the scope of an arbitration clause, we should apply a
common-sense examination and enforce the language of the contract according to its plain
meaning unless such a reading would defeat the true intent of the parties as reflected by the writing
itself. In re Lisa Laser USA, Inc., 310 S.W.3d 880, 884 (Tex. 2010) (per curiam). Although “we
generally favor arbitration agreements, we should not reflexively endorse an agreement so lacking
in precision that [we] must first edit the document for comprehension, and then rewrite it to ensure
its enforceability.” J.M. Davidson, Inc. v. Weber, 128 S.W.3d 223, 231 (Tex. 2003).
The majority holds the 2010 Arbitration Agreement is applicable to the claims arising out
of Lozano’s second term of employment, reasoning the 2010 Arbitration Agreement survived the
employer-employee relationship and applies to any “Covered Claim” asserted after termination of
Lozano’s first term of employment. I disagree.
In the interpretation proposed by the majority, the term “Covered Claim” includes not only
claims arising from injuries which might have occurred during the first term of employment as
contemplated by the parties when Lozano entered into the 2010 Arbitration Agreement, but also
any claim that might ever arise in connection with any term of employment Lozano has with UTS,
regardless of what connection there may or may not be to the term of employment the parties
contemplated at the time of the 2010 Arbitration Agreement. This interpretation defeats the
parties’ intent as reflected by the writing itself.
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Dissenting Opinion 04-16-00644-CV
The 2010 Arbitration Agreement identifies a “Covered Claim” as a claim arising from
“[a]ny injury suffered by Claimant while in the Course and Scope of Claimant’s employment with
[UTS].” The agreement also provides that the “[a]greement shall survive the employer-employee
relationship between the Company and the Claimant and shall apply to any Covered Claim whether
it arises or is asserted during or after termination of the Claimant’s employment with the Company
or the expiration of any benefit plan.” The arbitration agreement, however, does not expressly
state a “Covered Claim” may be a claim that arises after Lozano’s employment ended and in the
event he was rehired.
Unlike the arbitration agreement examined by the district court in Masse v. Waffle House,
a case which is relied upon by the majority, the 2010 Arbitration Agreement does not expressly
encompass claims arising during future periods of employment. See Masse v. Waffle House, No.
CIV-13-1301-HE, 2014 WL 1901112 at *1-3 (W.D. Okla. May 13, 2014). In Masse, the
arbitration agreement specifically stated the parties “will resolve by arbitration all claims and
controversies [ ], past, present, or future, whether or not arising out of [plaintiff’s] employment or
termination from employment …” See id. at *3.
Additionally, the 2010 Arbitration Agreement does not contain express language
referencing future claims, agreements, or relationships. In Anderson v. Waffle House, Inc., another
case relied upon by the majority, the arbitration agreement explicitly covered “all claims and
controversies (‘claims’), past, present, or future.” Anderson v. Waffle House, Inc., 920 F. Supp.
2d 685, 687 (E.D. La. 2013). The agreement at issue in Anderson also contained the following
language:
My agreement to accept arbitration can be revoked at any time within 7 days of my
signing this Agreement, but such revocation must be submitted in writing and will
result in my immediate termination, demotion and/or denial of consideration for
employment … If this agreement is not properly revoked by me within the 7-day
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Dissenting Opinion 04-16-00644-CV
time period described above, I understand that this Agreement will remain valid
and enforceable unless modified by Waffle House … or unless Waffle House and I
execute a subsequent arbitration agreement … .
Id. at 688 (emphasis added); Southland Health Servs., Inc. v. Bank of Vernon, 887 F. Supp. 2d
1158, 1164 (N.D. Ala. 2012) (arbitration agreement covered all disputes “based upon any prior,
current, or future agreement, loan, account, service, activity, transaction (proposed or actual), event
or occurrence”). The agreement examined by the district court in Masse was substantially similar
to that in Anderson, also expressly stating that it would ‘remain valid and enforceable unless
modified by’ [the] defendant.” Masse, 2014 WL 1901112 at *3. That level of specificity regarding
the parties’ intent with respect to the continued validity and enforceability of the arbitration
agreement is not present here.
I agree that when Lozano’s first term of employment ended in 2012, the 2010 Arbitration
Agreement survived with respect to any claims that may have arisen out of the 2010-2012 term of
employment. However, without a showing that the arbitration agreement remains valid and
enforceable following termination of employment, I would hold the 2010 Arbitration Agreement
did not survive with respect to any claims arising out of future terms of employment. I would
further hold UTS failed to demonstrate Lozano’s claim fell within the scope of the 2010 Arbitration
Agreement.
For these reasons I would affirm the trial court’s order denying UTS’s motion to compel
arbitration.
Accordingly, I respectfully dissent.
Irene Rios, Justice
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