To follow up on our post of last week. We are pleased to recommend another excellent law review article, “Disappearing Juries and Jury Verdicts,” 39 Tex. Tech L. Rev. 289, written by the Honorable Sam Sparks, U.S. District Judge for the Western District of Texas and DLA Piper attorney George B. Butts.
The article traces the history of jury trials, presents statistics reflecting the decline in the number of cases tried, and discusses Fifth Circuit and Texas Supreme Court cases relevant to the issue of the constitutional authority of the jury.
As it relates to arbitration, the authors make the following remarks:
IX. Compelling Arbitration
One form of alternative dispute resolution that frequently supplants jury trials is compulsory arbitration. The Texas Supreme Court has recently decided two cases that evidence the court’s strong preference for arbitration over litigation.
In re Weekley Homes, L.P. was a case of first impression in which the Texas Supreme Courtconditionally granted an application for writ of mandamus to require a trial judge to compel arbitration. The unusual aspect of the case was that the person resisting arbitration was not a party to the contract containing the arbitration clause that was sought to be enforced. Rather, she was the adult daughter of the owner of the house which was the subject of litigation. She did not assert any claim under the contract between her father and the homebuilder or sue as either trustee or beneficiary. The court, however, justified its conclusion to compel arbitration under the direct-benefits estoppel theory because the plaintiff had taken advantage of the benefits of the contract and was in fact the equitable owner of the house.
In re Dillard Department Stores, Inc. is another example of the Texas Supreme Court’s strong policy favoring arbitration. In Dillard, Garcia was discharged from her job as a sales associate at a Dillard’s store. She subsequently filed a retaliatory discharge suit. In response, Dillard’s filed an original mandamus proceeding in the Texas Supreme Court seeking to enforce an arbitration policy adopted by the company that it claimed covered most employment disputes, including Garcia’s. She claimed she had never agreed to an arbitration policy and had specifically refused to sign a form that required arbitration. Dillard’s was unable to produce any writing whereby Garcia acknowledged receipt of the arbitration policy. Despite that fact, the court concluded Garcia attended a meeting at which she received an acknowledgment form advising employees of Dillard’s arbitration policy. Ultimately, the supreme court concluded that both the trial court and the court of appeals abused their discretion by not granting Dillard’s motion to compel arbitration. The effect of the supreme court’s holding was that Garcia lost her Seventh Amendment right to a jury trial when she elected to continue her employment with Dillard’s after she received the arbitration acknowledgment.
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