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590 S.W.3d 518
Tex.
2019
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Background

  • Nathan and Misti Robinson purchased a new home covered by a limited warranty and addendum that required FAA-governed arbitration of “Unresolved Warranty Issues,” but neither document mentioned delegation of arbitrability or class arbitration.
  • The Robinsons sued for construction defects; the trial court compelled arbitration of their individual warranty claims under the contracts.
  • Shortly before arbitration, the Robinsons added putative class claims alleging HOME routinely demanded overbroad releases; the arbitrator denied HOME’s motion to strike and bifurcated the class claims.
  • After the arbitrator awarded the Robinsons on individual claims, the Robinsons sought to compel arbitration of the class claims; HOME asked the trial court to rule that class arbitrability is for the court and that the contracts do not authorize class arbitration.
  • The trial court and the court of appeals held that class-arbitrability is a gateway question for courts absent a clear and unmistakable delegation to an arbitrator, and that the warranty agreements—silent on class arbitration—did not authorize classwide arbitration; the Texas Supreme Court affirmed.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Who decides whether the parties agreed to class arbitration Broad arbitration clause delegates arbitrability to the arbitrator Class arbitrability is a gateway question for courts unless there is clear and unmistakable delegation Court: availability of class arbitration is a gateway question for the court absent clear and unmistakable delegation to an arbitrator
Whether the contracts authorize class arbitration The arbitration provisions broadly cover "Unresolved Warranty Issues," which include the class claims The agreements are silent on class arbitration; silence/ambiguity cannot be read to authorize class arbitration Held: silence or ambiguity is insufficient; an express contractual basis is required for class arbitration
Whether defendant consented or acquiesced to class arbitration by its conduct HOME’s prior motion to compel individual arbitration and participation before the arbitrator show assent HOME consistently objected to class arbitration and sought judicial determination; its conduct does not show clear assent Held: HOME did not consent or acquiesce; its conduct did not manifest clear intent to submit class arbitrability to the arbitrator

Key Cases Cited

  • Lamps Plus, Inc. v. Varela, 139 S. Ct. 1407 (2019) (holds silence or ambiguity cannot supply a contractual basis for class arbitration)
  • Stolt‑Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662 (2010) (explains class arbitration is fundamentally different and consent cannot be presumed)
  • Green Tree Fin. Corp. v. Bazzle, 539 U.S. 444 (2003) (plurality; discussed but later clarified as not settling the “who decides” issue)
  • Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524 (2019) (courts must enforce clear delegations of arbitrability to arbitrators)
  • First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (clarifies courts generally decide arbitrability absent clear and unmistakable evidence to the contrary)
  • In re Wood, 140 S.W.3d 367 (Tex. 2004) (prior Texas decision treating class‑arbitrability as for arbitrator; overruled on this point)
  • Jody James Farms, JV v. Altman Grp., Inc., 547 S.W.3d 624 (Tex. 2018) (Texas precedent holding silence does not establish clear delegation of arbitrability)
Read the full case

Case Details

Case Name: Nathan Robinson and Misti Robinson, Individually and as Representatives of All Persons Similarly Situated v. Home Owners Management Enterprises, Inc. D/B/A Home of Texas and Warranty Underwriters Insurance Company
Court Name: Texas Supreme Court
Date Published: Nov 22, 2019
Citations: 590 S.W.3d 518; 18-0504
Docket Number: 18-0504
Court Abbreviation: Tex.
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