Party failed to prove existence of agreement to arbitrate - mandamus, motion to compel denied

In Universal Finances Consulting Group, Inc.
(Tex.App.- Houston [14th Dist.] May 20, 2008)(Boyce)
(arbitration mandamus, motion to compel, proof of existence of arbitration agreement or claus missing)
Justice Bill Boyce  
Before Chief Justice Hedges, Justices Hudson and Boyce
14-08-00226-CV In Re Universal Finances Consulting Group, Inc., Zhuodao Zhoa, John J. Dunn, and Universal
Med-Health Services, Inc.
Appeal from 280th
District Court of Harris County
Trial Court Judge: Hon. Tony Lindsay

M E M O R A N D U M   O P I N I O N

On March 24, 2008, relators, Universal Finances Consulting Group, Inc., Zhuodao Zhao, John J. Dunn, and
Universal Med-Health Services, Inc., filed a petition for writ of mandamus in this court.  See Tex. Gov't Code Ann. '
22.221 (Vernon 2004); see also Tex. R. App. P. 52.  In the petition, relators ask this court to compel the
Honorable Tony Lindsay, presiding judge of the 280th District Court of Harris County, to vacate her order denying
their amended motion to compel arbitration and to stay the trial court proceedings.  

On August 16, 2007, real party in interest, Bill Cargill, filed suit against relators for the return of money he had
advanced under a purported escrow agreement to obtain a standby letter of credit to fund the operations of Agri
Dynamic Technology, S.A. de C.V., a Mexican corporation formed for agricultural reclamation and development in
Mexico.  Relying on an arbitration provision contained in an asset purchase agreement that was referenced in the
escrow agreement, relators filed a motion to compel arbitration and an amended motion for arbitration.  After a
hearing, respondent denied relators'  amended motion to compel arbitration because the "motion is not
supported by Defendants [sic] pleadings and . . . Defendants have failed to provide competent evidence in
support of their motion that establishes that there is a valid arbitration agreement, . . ."

To obtain mandamus relief, the relator must demonstrate that (1) the trial court clearly abused its discretion; and
(2) there is no adequate remedy by appeal.  
In re Sw. Bell Tele. Co., 226 S.W.3d 400, 403 (Tex. 2007) (orig.
proceeding).  The trial court abuses its discretion if it reaches a decision that constitutes a clear and prejudicial
error of law.  Walker v. Packer, 827 S.W.2d 833, 839 (Tex. 1992) (orig. proceeding).  As to factual matters, the
relator must establish that the trial court could have reached only one decision.  Id. at 840.

The party seeking to compel arbitration under the FAA must establish that (1) a valid arbitration agreement
exists, and (2) the claims at issue fall within that agreement's scope.  
In re Dillard Dep't Stores, Inc., 186 S.W.3d
514, 515 (Tex. 2006) (orig. proceeding) (per curiam).  Whether a valid arbitration agreement exists is a legal
question subject to de novo review.  
In re D. Wilson Constr. Co., 196 S.W.3d 774, 781 (Tex. 2006).  

Cargill objected that the escrow agreement and the asset purchase agreement are not authenticated and,
therefore, are not competent evidence of an agreement to arbitrate.  No presumption of arbitrability arises until
the court has found that there is an enforceable arbitration agreement.  In re Jebbia, 26 S.W.3d 753, 757 (Tex.
App.- Houston [14th Dist.] 2000, orig. proceeding).  To compel arbitration on a summary motion, a trial court must
first determine as a matter of law that the parties have agreed to arbitrate.  Id. (citing Jack B. Anglin Co. v. Tipps,
842 S.W.2d 266, 269 (Tex. 1992) (orig. proceeding)).  

The evidentiary standards for a motion to compel arbitration are the same as for a motion for summary judgment.  
TMI, Inc. v. Brooks, 225 S.W.3d 783, 794 (Tex. App.- Houston [14th Dist.] 2007, pet. denied) (op. on reh'g).  
Under the summary judgment standard, copies of documents must be authenticated in order to constitute
competent summary judgment evidence.  Republic Nat'l Leasing Corp. v. Schindler, 717 S.W.2d 606, 607 (Tex.
1986) (per curiam).  A properly sworn affidavit stating that the attached documents are true and correct copies of
the original authenticates the copies so they may be considered as summary judgment evidence.  Id.  

Here, no affidavit was submitted with either the motion to compel or the amended motion to compel authenticating
the escrow agreement or the asset purchase agreement.  We conclude that there is no competent evidence of an
agreement to arbitrate.  Because respondent could not have properly considered the escrow agreement or the
asset purchase agreement, she did not abuse her discretion by denying relators' amended motion to compel

Relators have not established their entitlement to the extraordinary relief of a writ of mandamus.  Accordingly, we
deny relators' petition for writ of mandamus.


Petition Denied and Memorandum Opinion filed May 20, 2008.

Panel consists of Chief Justice Hedges and Justices Boyce and Hudson.[1]


Senior Justice J. Harvey Hudson sitting by assignment.