When the Consumer Would Rather Not Litigate: Arbitration Agreement As a Defense Against a Motion for Summary Judgment in a Contractor-vs-Homeowner Case

Abstract

Appellate caselaw on arbitration-related issues is replete with cases involving the question whether a motion to compel arbitration was properly granted or denied. Currid v. Coit Cleaning & Restoration Services, No. 01-17-00630-CV (Tex.App. – Houston [1st Dist.] 2018) presents a less common scenario: A contractor sued a homeowner for additional amounts allegedly owed under a contract for remediation of water-damage at her home. Defendant Homeowner answered the lawsuit through an attorney but did not promptly file a motion to compel arbitration. Defendant-Homeowner instead invoked the arbitration clause contained in the underlying contract in opposition to the Contractor’s motion for a final summary judgment against her. Within the same response, the Homeowner Defendant cross-moved for dismissal on the ground that the lawsuit had been filed in the wrong forum. A visiting judge granted the summary judgment for the Contractor and the presiding judge of the trial court later denied the Homeowner’s motion for reconsideration, opining that the Homeowner had brought up arbitration too late. On appeal, the Contractor defended the summary judgment on arbitration-waiver grounds. The amicus curiae brief submitted in support of the Homeowner argues that the arbitration defense was not waived procedurally because it had been timely asserted in opposition to the Plaintiff’s motion for summary judgment, and that the contractual right to arbitrate had not been waived substantively under the waiver factors the Texas Supreme Court had articulated in Perry Homes v. Cull, 258 S.W.3d 580, 593-94 (Tex. 2008). Nor had the Contractor’s waiver argument been timely under the summary judgment rule. Unlike the homeowners in Cull, the homeowner here had not brought the lawsuit in the first instance; had not switched from first choosing litigation and then seeking a transfer to arbitration for tactical reasons; had not herself substantially invoked the litigation process; and had not even defended the claim against her on the merits, insisting instead that it was being pursued in the wrong forum. The brief also addresses the matter of the arbitration clause also being a forum selection clause, which takes it beyond the procedural framework governing arbitration-related motions under the Federal Arbitration Act (FAA) and the Texas General Arbitration Act (TGAA or TAA). Date of Abstract: April 7, 2018 Date of Amicus Brief: December 26, 2017