HOUSTON - Last year, the 14th Court of Appeals concluded that a trial court did not abuse its discretion when it denied Lennar Homes of Texas’ motion to compel arbitration in a personal injury lawsuit.
On Friday, the Texas Supreme Court issued a stay on the homebuilder’s petition for review, granting its motion for clarification
Court records show Mohammad Rafiei filed suit against Lennar Homes, alleging that he was severely injured when a garbage disposal in his home exploded. Rafiei and his wife purchased the home from Lennar in 2018. The sales contract for the house contained an arbitration provision.
Lennar Homes filed a motion to compel arbitration, which was denied by the trial court, court records show.
On appeal, Lennar Homes argued that Rafiei failed to establish the affirmative defense of unconscionability.
The 14th Court of Appeals affirmed the denial, finding that the trial court could have concluded that the arbitration agreement and the delegation clause within the arbitration agreement were both unconscionable.
“Arbitration is intended to be a lower cost, efficient alternative to litigation,” the opinion states. “Yet the evidence in this case establishes the opposite.”
In its petition for review, Lennar argues the court of appeals erred when it held that the delegation provision in Lennar’s arbitration agreement was unconscionable.
“If not corrected, the majority opinion will permit parties to attack a delegation provision with evidence pertaining to the arbitration agreement as whole,” the petition states. “This is directly contrary to general arbitration law as pronounced by the federal and Texas courts…”
The petition for review remains pending before the Texas Supreme Court.
Case No. No. 22-0830