On Friday we reported on a case in which the Corpus Christi Court of Appeals had to tell a trial judge to do something he was clearly required to do but didn’t. Today we see the Texas Supreme Court having to step in to mandamus a trial court because a party did not receive notice of an order denying arbitration until the appeal deadline had passed. To make matters worse, the trial court had already been reversed once by the court of appeals for erroneously denying the relator’s motion to compel arbitration on grounds of unconscionability, and SCOTX reversed a second time when the judge denied the motion on the ground that the arbitration provision was illusory. In our view, this should not be one of the 100 or so cases a year that SCOTX has the capacity to take.
In re Whataburger Restaurants LLC (No. 21-0165) arose in 2013 from an employee suit against her employer for an alleged workplace injury. The employer moved to compel arbitration based on a mandatory arbitration provision contained in the employee handbook and policy document signed by the employee. The employee responded that the arbitration provision was void and unenforceable on 15 grounds, including that the agreement was unconscionable and illusory. After a hearing in August 2013, the trial court denied the motion to compel and issued “findings of fact” and “conclusions of law.” Here is what Chief Justice Hecht had to say about those:
The court issued “findings of fact” regarding the costs and expenses associated with arbitration without evidence in the record to support them. The court also issued “conclusions of law” that were mostly impertinent, personal disparagements of arbitration in general. The court denied the motion to compel, holding only that the Policy was unconscionable.
The El Paso Court of Appeals rightly reversed the trial court and remanded with instructions to grant Whataburger’s motion to compel arbitration. The employee appealed to SCOTX, which sent the case back to the court of appeals to adjudicate cross-points that the employee had briefed in support of the trial court’s order. On remand, the court of appeals rejected all of the employee’s issues with one exception, that the agreement was illusory because the acknowledgement signed by the employee stated that Whataburger could revoke the arbitration clause at any time with or without notice (though the employee stated otherwise). The court of appeals sent the case back to the trial court to resolve that issue. In a one-sentence order, the trial court again denied the motion to compel. We are now in 2018, more than five years after the employee filed suit.
Whataburger had 20 days from the date the order was signed to appeal. But the clerk never sent notice that the order had been signed, and Whataburger didn’t find out about it until five months later when the employee’s attorney told them about it. Whataburger moved for reconsideration and a determination of when it received notice for purposes of appeal. The trial court declined to reconsider and issued an order stating that Whataburger had not received notice of the order within 90 days of its issuance. Whataburger appealed again to the court of appeals, which in a split decision denied relief. SCOTX granted Whataburger’s petition for a writ of mandamus.
In a strongly worded opinion by Chief Justice Hecht, SCOTX held that Whataburger was entitled to mandamus relief because the court, by failing to give notice of its order, had taken away its right to an interlocutory appeal of the denial of its motion to compel arbitration. The Court laughed off the employee’s argument that Whataburger did not diligently pursue its rights by “checking in” with the trial court, agreeing with the dissent at the court of appeals that a party is entitled to rely on court clerks doing their jobs and “that Texas has an efficient electronic notification system for a reason.” Turning to whether the trial court clearly abused its discretion in denying the motion to compel based on illusoriness, SCOTX held that it did. Based on the plain language of the policy requiring the employee to submit disputes, including those involving workplace injuries, to arbitration if the employee accepted and continued employment, the Court easily distinguished authority (J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 227 (Tex. 2003)) holding arbitration provisions to be ambiguous where an employer’s unilateral right to abolish or modify a personnel policy without notice did not clearly exclude the arbitration provision.
In a footnote at the end of the opinion, Chief Justice Hecht had this to say:
Texas appellate courts should not again be presented with a case in which a court of this State has prevented a party from taking an appeal to which the party has a clear right. If such a case does again arise, its nature and context will determine the scope of the relief. Because this case involves arbitration, claimed deprivations of which we traditionally addressed via mandamus, and because of the unusually elongated procedural history, we have addressed the merits directly as a matter of judicial economy rather than, for example, directing the court of appeals to first address the case on the merits.
It does not take much reading between the lines to understand what the Chief Justice means here. The trial court’s conduct was so egregious that it took two appeals to SCOTX to straighten it out—and it hasn’t really been straightened out until the trial court finally follows the law. What makes the situation even more outrageous is that the case has now dragged on for nearly 10 years, an unconscionable delay primarily attributable to a trial court that for whatever reason took the law into its own hands.
What remedies exist for courts that act this way? Frankly, complaints to the Judicial Conduct Commission just don’t cut it. If we are not going to change the method of selecting judges to make sure we get qualified people on the bench who won’t stand for this nonsense, then we need swift and sure removal mechanisms to get these people off the bench before they can do to somebody else what this judge has done to a Texas business that merely tried to enforce a contract. The same goes for judges who simply refuse to rule on motions, as in the case out of the Corpus Christi Court of Appeals. We can’t—and we shouldn’t—put the onus on SCOTX to fix every flagrant abuse of the judicial process that slips through the system.
