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13-16-00117-CV
THIRTEENTH COURT OF APPEALS
CORPUS CHRISTI, TEXAS
FILED 9/8/2016 10:59:27 AM
IN THE 13TH COURT OF APPEALS Dorian E. Ramirez
CORPUS CHRISTI - EDINBURG CLERK
v.
Steven Gonzalez
SBN: 08131900
Gerald E. Castillo
SBN: 24012399
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NAMES OF ALL PARTIES AND THEIR COUNSEL IN THE TRIAL COURT
In order that the members of the Court may determine whether they are
TEX. R. APP. P. 38.1(a), that the following is a complete list of the names and
addresses of all parties and their counsel in the Trial Court, to-wit:
Steven Gonzalez
SBN: 08131900
Gerald E. Castillo
SBN: 24012399
GONZALEZ CASTILLO, LLP
1317 E. Quebec Avenue
McAllen, Texas 78503
Email: law@valleyfirm.com
(956) 618-0115
FAX: (956) 618-0445
Ricardo Palacios
SBN: 24010990
Criselda Palacios
SBN: 24067812
PALACIOS GARZA & THOMPSON, P.C.
2724 West Canton Road
Edinburg, Texas 78539
Emails: rpalacios@pgtlawfirm.com and cpalacios@pgtlawfirm.com
(956) 205-0848
FAX: (956) 318-0575
IOC Company, L.L.C., Plaintiff/Appellant:
Michael A. McGurk
SBN: 00797746
KITTLEMAN THOMAS, PLLC
4900-B N. 10th Street
McAllen, Texas 78504
Email: mmcgurk@ktattorneys.com
(956) 632-5018
FAX: (956) 630-5199
Michael A. McGurk
SBN: 00797746
Ricardo Pumarejo, Jr.
SBN: 24056168
KITTLEMAN THOMAS, PLLC
4900-B N. 10th Street
McAllen, Texas 78504
Emails: mmcgurk@ktattorneys.com and rpumarejo@ktattorneys.com
(956) 632-5018
FAX: (956) 630-5199
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TABLE OF CONTENTS
NAMES OF ALL PARTIES AND THEIR COUNSEL IN THE TRIAL COURT . . . . . . . i-ii
LIST OF AUTHORITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SUMMARY OF FACTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
PRAYER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
CERTIFICATE OF COMPLIANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
CERTIFICATE OF SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
APPENDIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
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LIST OF AUTHORITIES
CASES Page
Black v. Shor,
443 S.W.3d 154 (Tex. App.Corpus Christi 2013)...........................................5, 7
Hoskins v. Hoskins,
No. 15-0046, 2016 Tex. LEXIS 386 (Tex. May 20, 2016) . . . . . . . . . . . . . . . . . 5
STATUTES
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I.
Introduction
COMES NOW, Appellee City of Edinburg, (COE), and submits this Sur-Reply
to Appellants Reply Brief to concisely address two (2) arguments affecting the
vacatur of the Arbitration Award. COE shall address the arguments in the same
order in which the Appellant made its assertions. COE requests that this Court of
Appeals affirm the Trial Court's ruling to vacate the Arbitrators Award.
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II.
Summary of Facts
COE hereby incorporates by reference the relevant facts as set forth in its
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III.
Argument
The public policy argument was not urged before this Court because
Hoskins v. Hoskins, No. 15-0046, 2016 WL 2993929, at *2 (Tex. May 20, 2016)
non-statutory common law ground. Rather, the grounds enumerated in the statute
are exclusive. In Hoskins, the Petitioner sought to vacate the Arbitrators Award
based on the Texas General Arbitration Act enumerated grounds and on the non-
statutory independent common law ground of manifest disregard of the law. Id.
Since COE is not urging its' public policy independent statutory common law
Werline and Black are distinguishable from the present case. In both cases
outlined above, a basis for seeking to vacate the underlying Arbitration Award were
Co., Inc. v. Werline, 307 S.W.3d 267, 268 (Tex. 2010); Black v. Shor, 443 S.W.3d
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Here, COE does not proffer the independent non-statutory common law
as a common law argument. Rather, the Texas common law cited is used to show
how Texas Courts, including this Court, have defined the phrase undue means
as allowed under the Texas Code Construction Act Chapter 311. It is undisputed
that the term undue means is undefined by the statute. The Texas Code
Construction Act, 311.011(b) states that words or phrases that have acquired
used to interpret the technical meaning of statutory words or phrases. TEX. GOVT
The phrase undue means has been given a particular meaning by Texas
Courts and undue means should be construed accordingly. Texas case law has
held that undue means must be shown by immoral, illegal, or bad faith conduct.
Las Palmas Medical Center v. Moore, 349 S.W.3d 57, 70 (Tex. App. El Paso
2010, pet. denied). Texas Courts have defined undue means as bad faith
judgment. Good Times Stores, Inc. v. Macias, 355 S.W.3d 240 (Tex. App. El
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Paso 2011, pet. denied); Black v. Shor, 443 S.W.3d 154, 169 (Tex. App. Corpus
Based on the meaning given to the phrase undue means by Texas Courts
it is obvious that the Arbitrator disregarded the specific mandates of the law and
the plain terms of the contract. This egregious conduct warrants the inference
that the Arbitrator acted on bad faith. Thus, vacatur of the Arbitration Award is
required.
rationally inferable from the contract and the Arbitrator exceeded his authority by
issuing an award not allowed under Texas law. The result in this case was that the
Arbitrator awarded damages to Appellant for non-owner caused delays. The single
question is whether the award is rationally inferable from the contract considering
the wording and purpose of the contract. Nationsbuilders, Ins. Servs., Inc. v.
Houston Int'l Ins. Grp. Ltd., No. 051201103CV, 2013 WL 3423755 (Tex.
App.-Dallas July 3, 2013) (mem. op.); Ancor Holdings, LLC v. Peterson, Goldman
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& Villani, Inc., 294 S.W.3d 818, 829 (Tex. App.Dallas 2009, no pet.). Appellant
contends that Nationsbuilder stands for the proposition that this Court should look
only to the result and not determine whether the remedy is rationally inferable.
inferable from the contract by looking to the wording and purpose of the contract.
Nationsbuilders, Ins. Servs., Inc. v. Houston Int'l Ins. Grp. Ltd., No.
The remedy of a one (1) year extension of the restricted period gave
Nationsbuilders the benefit of its bargain of a one (1) year period
without Appellees preparing to conduct a business in competition
with Nationsbuilders. The remedy [drew] its essence from this
provision and is rationally based on that provision. Id. at *4.
As shown above, the Court did not reach its holding by simply looking at the
result as Appellants urge. Instead, the Court looked to the underlying contract to
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Here, the result/remedy awarded to Appellant for the Sugar Road Project
and Canton Road Project is not rationally inferable. The purpose and wording of
the contract protected COE from having to pay damages arising from non-owner
caused delays pursuant to the TEXAS GOVERNMENT CODE 271.153(a)(1). There are
four (4) Articles, 4.3, 4.4, 7.1, and 12.1(D), contained in the Sugar Road Project
contract that clearly state that the duty and responsibility of re-locating the utility
lines belongs to others and that COE would not be responsible for delays caused
by others. Despite the contractual provision, the Arbitrator issued a remedy for
delays caused by others. Unlike, Nationsbuilder, the result in this matter is not
With regard to the Canton Road Project and Sugar Road Project, the
result/remedy is not rationally inferable from the contract. The Sugar Road
Project and the Canton Road Project contracts each outline the process that
prior to the Arbitration, did not seek additional compensation for delays. Despite
for delays because the contractual provision that governed did not apply.
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COE is not asking that the Court reconsider its liability under the contract.
Rather, COE asks the Court to determine whether the Arbitrator strayed from the
interpretation of the Agreement and dispensed his own brand of justice. Thus,
the only question before the Court is: Did the Arbitrator stray from the
contravention with Texas law. The Court in Nationsbuilder, held that the remedy
within the arbitrators authority because the governing law allowed an equitable
extension. Nationsbuilders, Ins. Servs., Inc. v. Houston Int'l Ins. Grp. Ltd., No.
(mem. op.). Thus, the Court concluded that the arbitrator did not exceed his
power. Id.
Texas law does not allow Appellant to recover for non-owner caused delays. Texas
law does not permit waiver of sovereign immunity for non-owner caused delays.
Zachry Const. Corp. v. Port of Houston Auth. of Harris County, 449 S.W.3d 98,
110 (Tex. 2014); Tex. Loc. Gov't Code Ann. 271.153(a)(1). It is undisputed that
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Texas law governs in this case. The Arbitrator had authority to apply Texas law
pursuant to the arbitration agreement. Despite the applicable Texas law, the
caused delays is not within the arbitrators authority. Thus, the Arbitrator exceeded
IV.
PRAYER
For the foregoing reasons, Appellee, COE, prays that the Trial Court's
judgment be in all things affirmed. COE prays for such other legal and equitable
Respectfully Submitted,
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Ricardo Palacios
SBN: 24010990
Criselda Palacios
SBN: 24067812
CERTIFICATE OF COMPLIANCE
/s/Gerald E. Castillo
Gerald E. Castillo
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CERTIFICATE OF SERVICE
I hereby certify that on September 8, 2016, a true and correct copy of this
document was served upon the following persons via electronic filing service:
Michael McGurk
mmcgurk@ktattorneys.com
Jesus Garcia
jgarcia@tbgdlaw.com
/s/Gerald E. Castillo
Gerald E. Castillo
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CAUSE NO. 13-16-00117-CV
APPELLEES APPENDIX
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