Santander Consumer USA, Inc. v. Mario A. Mata Centroplex Automobile Recovery, Inc. Blake Thornton Vandusen, John F. Thompson D/B/A Centroplex Automobile Recovery, Inc. And Redshift Investigation, Inc.

Citation: Not availableDocket: 03-14-00782-CV

Court: Court of Appeals of Texas; December 30, 2014; Texas; State Appellate Court

Original Court Document: View Document

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Santander Consumer USA, Inc. is the appellant in a legal case against Mario A. Mata, Centroplex Automobile Recovery, Inc., Redshift Investigation, Inc., and Blake Thornton Vandusen, the appellees. The appeal is from the 353rd Judicial District Court in Travis County, Texas. The appellant's counsel includes Donald L. Turbyfill, Deborah C. S. Riherd, and Vicki W. Hart from Turbyfill, Devlin, Naylor, P.L.L.C. Oral argument is requested. The document outlines the parties involved, their counsel, and the issues presented for appeal, notably the trial court's denial of Santander's motion to compel arbitration and stay the case concerning Mata's claims against all defendants. The brief includes a table of contents featuring sections such as the identity of parties, a statement of the case, and arguments supporting the appeal.

The document includes several key sections: a prayer for relief, a certificate of compliance, a certificate of service, and an appendix. The index of authorities lists various legal cases cited within the document, organized by case name and including citation details. Significant cases referenced include *In re D. Wilson Constr. Co.*, *In re FirstMerit Bank, N.A.*, *In re Kellogg Brown Root, Inc.*, and *In re Stanford Group*, among others, with their respective citations provided. The cases span various legal principles and proceedings relevant to the issues at hand, indicating a thorough reliance on established case law to support the arguments presented in the document.

MARIO A. MATA initiated legal proceedings against multiple defendants, including SANTANDER CONSUMER USA, INC., CENTROPLEX AUTOMOBILE RECOVERY, INC., and others, alleging common law fraud, trespass, conversion, breach of contract, negligence, and violations under the Texas Deceptive Trade Practices Act. These claims arose from a contested repossession of Mata’s 2003 Chevrolet Suburban, which was secured by a retail installment contract held by Santander.

Santander filed cross-claims against various defendants, including Centroplex and Vandusen, seeking statutory contribution and indemnification under Texas statutes. Vandusen counter-claimed against Santander for indemnity and contribution and also brought cross-claims against Redshift. Redshift asserted its own cross-claims for contribution, indemnity, and breach of contract against Centroplex.

Santander requested a motion to compel arbitration for Mata's claims against all defendants, which the trial court granted concerning claims between Mata and Santander but denied for claims involving other defendants. 

The request for oral argument emphasizes that it would provide the court with a better understanding of the facts and significantly assist in the case's resolution.

The trial court erred by denying Santander’s Motion to Compel Arbitration and Stay the case concerning Mata’s claims against all Defendants. On December 1, 2002, Bay City Investigations and Drive Financial entered into a Service Agreement wherein Bay City took possession of motor vehicles for Drive Financial. Bay City is now known as Redshift, and Drive Financial operates under the assumed name of Santander. On December 28, 2002, Mata executed a purchase and finance Contract with Capitol Chevrolet, Inc. for a vehicle, which included a security interest perfected by notation on a Texas certificate of title. The Seller later assigned the Contract to Arcadia Financial, which is succeeded by CitiFinancial Auto. In January 2009, Mata entered an Amendment Agreement with CitiFinancial Auto to modify the Contract, reducing the interest rate from 12.82% to 4.0% and requiring payments of $518.70 over 23 months, with the final installment due on December 23, 2010. As part of the Amendment Agreement, Mata agreed that any claims arising from the Contract or related relationships could be resolved by arbitration if chosen by Mata. All other terms of the original Contract remained effective except those explicitly modified by the Amendment Agreement.

The Amendment Agreement includes an Arbitration Provision mandating that any claims or disputes between Mata and CitiFinancial Auto, or its employees and agents, related to the contract, including issues of interpretation, enforcement, or arbitrability, shall be resolved through neutral, binding arbitration rather than court action. This provision is binding on both parties and their respective heirs, successors, and assigns, and is governed by the Federal Arbitration Act.

On June 1, 2010, Redshift and Centroplex entered into a Recovery Agreement, wherein Redshift agreed to assist financial institutions in recovering secured collateral, and Centroplex intended to establish a relationship for recovery assignments. On September 6, 2010, Santander became the servicer and owner of the modified contract. Despite acknowledging receipt of full payment by Santander, Redshift engaged Centroplex to repossess Mata's vehicle, leading to Mata suffering physical injuries during the repossession attempt by Centroplex employee Vandusen.

Mata filed a lawsuit against Santander for breach of contract and against all defendants for common law fraud, trespass, gross negligence, and violations under the Texas Deceptive Trade Practices Act concerning the repossession. Mata claims that Redshift acted as an agent for Santander, that Vandusen was an employee of Centroplex, and that Centroplex operated as an agent for Redshift, with Thompson as the owner of Centroplex. Redshift acknowledged its agreement with Santander and the Recovery Agreement with Centroplex, while Centroplex admitted to engaging Vandusen for vehicle repossession tasks. 

Thompson, Santander, and Vandusen filed cross-claims against Redshift, Centroplex, Thompson, and Vandusen for indemnification, contribution, and proportionate responsibility, while Vandusen counterclaimed against Santander for indemnity and/or contribution and asserted cross-claims against Redshift for the same. Redshift also asserted cross-claims for contribution, indemnity, and breach.

Centroplex is facing a breach of contract claim initiated by Mata. Santander has filed a motion to compel arbitration, arguing that Mata's claims against all defendants stem from the same contract. The trial court approved the motion for the claims between Santander and Mata but denied it concerning all other claims. The standard of review for the enforceability of an arbitration agreement is de novo, meaning the appellate court independently reviews the legal aspects while deferring to the trial court's factual findings supported by evidence. The argument asserts that the trial court made an error by denying Santander's motion to compel arbitration regarding Mata's claims against all defendants.

The trial court incorrectly denied Santander's motion to compel arbitration regarding Mata's claims against all Defendants. Mata's claims were found to be covered by a valid arbitration agreement. Under the Federal Arbitration Act (FAA), a party must prove (1) the existence of a valid arbitration agreement and (2) that the claims are within its scope. Texas law governs the assessment of whether claims fall within the arbitration clause's scope, irrespective of whether the FAA or the Texas Arbitration Act (TAA) is invoked. The TAA mandates that a court must order arbitration if a party shows an agreement exists and the opposing party refuses to arbitrate. If this refusal is denied by the opposing party, the court must summarily resolve that issue. The trial court can compel arbitration based on stipulations, affidavits, pleadings, and discovery. Should the opposing party fail to provide contradicting evidence, the court must grant the motion to compel arbitration. Parties are bound by the arbitration agreement unless fraud, misrepresentation, or deceit is present. The determination of the existence of an arbitration agreement is a question for the court to review de novo, including whether the agreement is binding on non-parties.

The Amendment Agreement includes an Arbitration Provision that mandates Mata to arbitrate any claims or disputes arising from the Contract, including those involving third parties. Despite the absence of a signature from Thompson or Vandusen on the Arbitration Provision, a valid arbitration agreement exists as Mata did not provide evidence of fraud, misrepresentation, or deceit regarding its enforceability. Six legal theories may bind non-signatories to arbitration agreements: incorporation by reference, assumption, agency, alter ego, equitable estoppel, and third-party beneficiary. The scope of the arbitration agreement can extend to claims against agents of the principal, provided that their allegedly wrongful acts relate to their agency and fall within the arbitration provisions. The term "agent" encompasses individuals or entities for whom a party is vicariously liable, such as independent contractors acting on behalf of a secured creditor. This legal framework is supported by various case law references, including the principles established in prior Texas appellate decisions.

MARIO A. MATA initiated a lawsuit against SANTANDER CONSUMER USA, INC., CENTROPLEX AUTOMOBILE RECOVERY, INC., BLAKE THORNTON VANDUSEN, JOHN F. THOMPSON, and REDSHIFT INVESTIGATION, INC., collectively referred to as Defendants. Mata's claims include common law fraud, trespass, conversion, breach of contract, negligence, and violations of the Texas Deceptive Trade Practices Act, all related to an alleged attempted repossession of his 2003 Chevrolet Suburban, which secured a retail installment contract held by Santander. 

Santander filed cross-claims for statutory contribution and indemnification against the other defendants under Texas law. Vandusen counter-claimed against Santander and cross-claimed against Redshift for indemnity and contribution. Redshift also filed cross-claims against Centroplex for contribution, indemnity, and breach of contract.

Santander sought a motion to compel arbitration for all Mata's claims based on the arbitration clause in the retail installment contract, which the trial court granted for claims against Santander but denied for claims against the other defendants. The legal standard for reviewing the denial of the motion to compel arbitration is de novo for legal questions, while factual determinations are upheld if supported by evidence. The appellate court is tasked with reviewing whether a valid arbitration agreement exists and if Mata's claims fall within its scope, as outlined by the Federal Arbitration Act (FAA) and applicable Texas procedures.

The TAA mandates that a court compel arbitration when a party demonstrates an agreement to arbitrate and the opposing party refuses. If the opposition denies the existence of the agreement, the court will summarize determine that issue quickly. The trial court may rely on affidavits, pleadings, discovery, and stipulations for its decision. If the opposing party does not provide evidence to contest the agreement, the court must grant the motion to compel arbitration. Parties are bound to arbitrate according to the terms of the agreement unless there is evidence of fraud, misrepresentation, or deceit. The existence of a valid arbitration agreement is a question for the court, which reviews it de novo. The Amendment Agreement includes an Arbitration Provision, obligating Mata to arbitrate claims arising from the Contract. Neither Mata nor other parties contested the existence of the Arbitration Clause or claimed it was procured through fraud. Although the Arbitration Provision was not signed by all parties, this does not negate its validity, as established legal principles allow for binding non-signatories under certain conditions, including incorporation by reference, agency, and equitable estoppel.

The excerpt outlines the legal principles governing the extension of arbitration agreements to claims against agents of a principal, particularly in the context of vicarious liability. It establishes that agents can be held accountable for their actions if those actions relate to their role as agents and fall within the claims covered by the arbitration provisions. The term "agent" includes individuals or entities for which a party may be vicariously liable. A secured creditor may be vicariously liable for breaches of peace committed by independent contractors during collateral repossession attempts, emphasizing that legal duties concerning public safety cannot be delegated to independent contractors. The document references a case (SEB) where the Campbells executed an arbitration agreement related to their purchase of a manufactured home. Although the agreement was signed by SEB’s president on behalf of Circle B Homes, the court ruled that the agreement also applied to claims against non-signatory individuals (Bath and Cousins) because the claims arose from their employment actions connected to the sale of the home. The trial court's denial of a motion to compel arbitration was reversed based on these findings.

Extending an arbitration provision to include agents of a party who agreed to arbitration promotes the policy favoring arbitration and aligns with the parties' intent to establish a single forum for dispute resolution. Mata claims that Santander is vicariously liable for actions taken by its agents, Thompson and Vandusen, during the repossession of Mata's vehicle by Redshift and Centroplex, which were acting on behalf of Santander. Redshift acknowledges its engagement of Centroplex for the repossession, confirming that it acted for Santander and repossessed Mata's collateral. Consequently, the non-signatory defendants are bound to the arbitration provision, supporting the resolution of all claims in a unified arbitration forum. The trial court erred by denying Santander's motion to compel arbitration with respect to the non-signatory defendants. Additionally, the theory of incorporation by reference binds these other defendants to arbitration, as cited in relevant case law. The passage also references a time charter party and a voyage charter between Progress Bulk and Keytrade USA, both containing arbitration clauses requiring disputes to be resolved in London, with the Congen bill of lading incorporating the charter's terms.

The excerpt outlines a legal case involving the incorporation of arbitration clauses through bills of lading and guaranty agreements. In the first case, the Fifth Circuit determined that KUSA, though a non-signatory to the arbitration agreement between Progress Bulk and KAG, was required to arbitrate its claims because the bill of lading referenced the Progress Bulk/KAG voyage charter, which included an arbitration clause. The court noted exceptions to the "four corners" rule that typically limits arbitration agreements to their explicit terms, affirming that the charter's clause granted arbitration rights to parties of the bill.

In a separate case involving Kvaerner and BCH Energy, a Construction Agreement mandated arbitration for disputes arising under it. The Bank of Tokyo, which financed the project, entered into Guaranty Agreements ensuring the joint venture's performance. When the joint venture defaulted, the Bank sued Kvaerner and Jones for breach of the Guaranty Agreements. The Fourth Circuit ruled that the Bank was also required to arbitrate its claims, as the Guaranties, while not explicitly mentioning arbitration, incorporated the Construction Agreement’s arbitration clause by reference, thereby granting Kvaerner and Jones the right to arbitrate related disputes.

Agreement terms outline the relationship between SCUSA, Redshift, and Centroplex, focusing on recovery services for collateral tied to retail installment contracts. SCUSA engages Redshift for investigative and recovery tasks concerning specific accounts receivable. The Recovery Agreement allows Redshift to work with financial institutions to recover secured collateral, emphasizing Centroplex's intent to collaborate with Redshift for recovery assignments.

Key elements include the incorporation of retail installment contracts into the Service and Recovery Agreements, establishing that all repossession actions derive benefits from these contracts. Non-signatories are bound to the agreements through arbitration provisions, which favor resolving disputes through arbitration as indicated by Texas and federal policies.

The excerpt also addresses the determination of whether claims fall within the arbitration agreement’s scope, emphasizing a factual focus over legal causation. It concludes that Mata is required to arbitrate his claims related to the Contract, including those concerning its servicing, collection, or enforcement, particularly regarding the alleged repossession of a vehicle securing payment. Mata's claims suggest an agency relationship among the defendants involved.

Mata's claims against all Defendants are subject to arbitration, and the trial court erred in denying Santander's motion to compel arbitration and stay the case regarding Mata's claims against the other Defendants. Santander Consumer USA, Inc. requests that the court grant oral argument for this appeal, reverse the trial court's order, and compel arbitration for Mata’s claims in the underlying action. Additionally, Santander seeks any further relief deemed justly entitled. The document includes certifications of compliance and service, confirming that copies were served to relevant parties by electronic means or mail prior to the deadline.

A motion was heard on August 6, 2014, regarding Santander Consumer USA, Inc.'s request to compel arbitration and stay the case. The court partially granted the motion, ordering that claims made by plaintiff Mario A. Mata against Santander must be submitted to arbitration according to an agreement dated January 9, 2009. However, the motion was denied concerning all other claims against Centroplex Automobile Recovery, Inc., Blake Thornton Vandusen, John F. Thompson d/b/a Centroplex Automobile Recovery, Inc., and Redshift Investigation, Inc. Mata is required to initiate arbitration within 30 days, and Santander must cover the necessary filing and administrative costs associated with the arbitration. If Mata fails to initiate arbitration timely, his claims against Santander may be dismissed. The court stayed the entire litigation pending the arbitration of Mata's claims against Santander. The order was signed by the presiding judge on the same date.

The document outlines an order regarding Santander Consumer USA, Inc.'s motion to compel arbitration and a plea in abatement. It includes various attorney representations for the involved parties, detailing their names, law firms, bar numbers, contact information, and roles as either defendants, cross-defendants, or plaintiffs. The order confirms that it is agreed as to form only, indicating that the parties have consented to the document's structure without necessarily agreeing to its content. An amendment agreement is also referenced, dated January 9, 2009, involving CitiFinancial Auto and Mario Mata as the borrower, instructing the review and signing of attached documents for further processing. The document emphasizes the need for proper documentation and retention for records.

The installment contract or promissory note and security agreement dated December 23, 2002, identified by account number -9686, acknowledges a total amount due of $11,443.67. This amount includes an unpaid principal balance of $11,333.24, unpaid interest of $115.43, and various unpaid fees totaling $2.00. The Borrower(s) commit to pay this total, along with interest on the unpaid principal at an annual rate of 4%, in 23 monthly installments of $518.70 starting February 23, 2009, and concluding with a final payment due December 23, 2010. This final payment will cover any remaining principal, accrued interest, and other sums owed under the modified contract. 

All terms of the original contract remain effective unless specifically modified. The security interest granted earlier is affirmed as valid. The agreement includes an arbitration provision, significantly affecting the parties' rights in disputes, requiring careful reading prior to signing. Borrower(s) must obtain any necessary consents for the agreement to be effective, and it becomes void if not signed by January 23, 2003. Additionally, the agreement does not extend any credit insurance from the original contract, and any forgiven debt may need to be reported to the IRS. Arbitration is mandatory for any claims or disputes, which must be handled individually, prohibiting class action participation, and is governed by the Federal Arbitration Act.

Arbitration is not required for certain matters between the parties, including: 1) self-help remedies; 2) provisional remedies for enforcing security interests from a court; 3) actions in small claims court seeking $15,000 or less; and 4) collective actions with total monetary relief of $315,000 or less. Exercising these rights does not waive the right to arbitration. The initiating party must select either the American Arbitration Association or the National Arbitration Forum for arbitration, adhering to their respective rules. The American Arbitration Association's "Commercial Arbitration Rules" apply, while the National Arbitration Forum follows its “Code of Procedure.” The initiating party pays the filing fee, with the company covering any excess beyond the cost of filing a lawsuit. The company will also bear other administrative costs related to arbitration. Each party is responsible for its own attorney and expert fees unless otherwise stated. This arbitration provision is binding on heirs, successors, and assigns. The parties agree to these terms in the Amendment Agreement.

The document presents a series of references and legal citations, primarily focusing on various legal entities, case numbers, and potential outcomes pertaining to a specific legal matter. It includes mentions of multiple parties involved, possible legal frameworks, and procedural steps that might be relevant in a judicial context. The text appears disjointed and fragmented, suggesting a transcription error or encoding issue, making it challenging to derive coherent legal arguments or conclusions from the content. Nonetheless, it indicates an ongoing legal process with multiple facets and possibly contentious issues that require further examination or clarification within the broader legal context.

Agreements to arbitrate in maritime transactions or contracts involving commerce must be in writing to be valid, irrevocable, and enforceable, except on grounds for revocation that exist in law or equity. This provision establishes that disputes arising from such contracts, including refusals to perform, can be settled via arbitration. Additionally, if a legal action is initiated in U.S. courts regarding an issue that is subject to an arbitration agreement, the court must stay the proceedings upon request from one party, provided that the requesting party is not in default regarding the arbitration process. These stipulations are rooted in the historical legal framework established by the Act of February 12, 1925, and later revisions.

This section outlines the legal framework for arbitration, referencing the Act of February 12, 1925, and relevant amendments. It establishes that a party aggrieved by another's failure to arbitrate under a written agreement may petition a United States district court with jurisdiction over the matter. The petition must include a five days’ written notice to the defaulting party, served per the Federal Rules of Civil Procedure. The court is tasked with determining whether the arbitration agreement exists and if compliance is contested. If satisfied, the court will order the parties to proceed with arbitration as specified in the agreement. Arbitration proceedings are to occur in the district where the petition for the order was filed. If there are disputes over the making of the arbitration agreement or compliance issues, the court will handle these matters summarily and may conduct a trial if no jury is requested or if the case falls under admiralty jurisdiction.

A party alleged to be in default can demand a jury trial regarding the issue before the return day of the application notice, except in admiralty cases. Upon such a demand, the court is required to refer the issue to a jury according to the Federal Rules of Civil Procedure. If the jury finds no written agreement for arbitration or identifies no default in the proceedings, the case will be dismissed. Conversely, if the jury determines that a written arbitration agreement exists and there is a default, the court will order the parties to proceed with arbitration as per the agreement's terms. The excerpt also includes a historical reference to legislative amendments and revisions impacting the procedural rules.

A secured party may proceed to enforce its rights either through judicial processes or without judicial processes, provided there is no breach of the peace. The secured party can require the debtor to assemble the collateral. After a default and if agreed upon, the secured party may make the collateral available at a mutually designated location. The document further outlines that a court must order arbitration if a party shows there is an agreement to arbitrate and the opposing party refuses to arbitrate. If the opposing party denies the existence of the agreement, the court will determine that issue summarily. If the court finds in favor of the party that applied for arbitration, it will order the arbitration and stay any related proceedings. The history notes the relevant legislative actions and effective dates for these provisions.