A Texas law firm’s attempt to compel a couple to arbitration fell short in an appeals court because, the court said, it never signed the agreement to begin with.
Shrader & Associates LLP filed the motion, hoping to get the 295th District Court in Harris County, Texas, to compel Crissy and David Carrasco, Jr. to arbitration in their legal malpractice suit against Shrader & Associates. The lower court agreed with the Carrascsos as they disputed personal jurisdiction. The Court of Appeals for the First District of Texas concurred and dismissed the law firm’s complaint on Sept. 24. Justice Gordon Goodman wrote the opinion. Justices Russell Lloyd and Beth Landau concurred.
Ultimately, the appeals court said, the law firm never signed the fee agreement that contained the arbitration clause that the firm now wants to use to compel the couple to arbitration. On top of that, the law firm never exhibited any performance that previously showed it would comply with the agreement, the court said.
“The record in this case does not contain equivalent evidence of performance, or other evidence, showing that that the firm bound itself to the agreement,” the appeals court said. “Shrader & Associates admits that several months after the Carrascos signed the fee agreement, the firm ‘communicated to Chrissy that it would be unable to proceed with the representation’ and then sent a formal letter a week later explaining that the firm ‘would be unable to represent you or otherwise pursue a case,’” according to the opinion.
The appeals court denied Shrader.& Associates’ claim that the existence of the fee agreement alone is enough to compel the Carrascoses to arbitration. "Shrader & Associates did not sign the fee agreement, and the blank for indicating its date of execution is unfilled. There is no evidence that the firm performed under the fee agreement. Nor is there evidence showing that the firm otherwise intended to be bound by the fee agreement,” the appeals court said.
While the Carrascos have no connection to Texas, they hired Shrader & Associates to represent them in a personal injury lawsuit. But Shrader & Associates told the couple it couldn’t represent them after the statute of limitations ran out on the personal injury claim. Shrader & Associates never filed the lawsuit on their behalf and said it wouldn’t be able to moving forward. They responded with the legal malpractice complaint.