More than a year ago now, guest blogger Rick Freeman wrote about an arbitration decision out of San Antonio where a trial court refused to compel arbitration on the basis that the high cost of arbitration made the agreement to arbitrate unconscionable. This morning, the Texas Supreme Court denied the petition for review in that case, leaving the San Antonio opinion good law, for now at least. What does this mean for state of cost-based unconscionability challenges to arbitral agreements? Probably not all that much, actually. As we mentioned in August, the Texas Supreme Court has already heard oral argument in the Johnny Luna case, out of Houston, which addressed the same issue. Texas arbitration practitioners should continue their vigil, waiting for the last shoe to drop, as it were; the denial of the Ayala petition for review does not mean that we won’t get a Texas Supreme Court pronouncement on this issue. Special thanks, by the way, to Austin lawyer Rick Leeper for pointing this out to me this morning. I gave a speech on this issue today at the Page Keeton Civil Litigation conference put on by the UT law school. I mentioned that some of us were nervously waiting for the Johnny Luna opinion, and Rick pointed out, during the speech, that this very morning the Court had ruled on the “other” case on this issue. The internet really is incredible; Rick had obviously already found out about an hour’s-old decision which did not involve an opinion while attending and paying attention to a seminar and thus was able to point out that the law was evolving on my speech topic even as I gave the speech. For those interested, I will post the speech to the web page as soon as possible. Readers of the blog may find part of it familiar. Olshan Foundation Repair v. Ayala, 180 S.W.3d 212 (Tex. App. – San Antonio 2005, pet. denied). Technorati Tags: arbitration, ADR, Texas Supreme Court, law

Perhaps less likely to come up than the situation in this morning’s other Texas Supreme Court opinion, the Court also addressed the scope of Texas’ antitrust statute (the Texas Free Enterprise and Antitrust Act of 1983) this morning. The Coca-Cola Company v. Harmar Bottling Company, ___ S.W.3d ___ (Tex. 2006) (Cause No. 03-0737).

As an initial matter, we would like to apologize for our absence for the last month and a half. From time to time the actual practice of law interferes with the blogging. We’ve been extremely busy for the last month or so, which is good, but which also prevented us from blogging. For a variety of reasons, however, things are more or less back to normal now. Which is a good thing, because this morning the Texas Supreme Court released two opinions, one of which apparently changes Texas law with respect to the enforceability of covenants not to compete in the at-will employment context. The opinion discusses the history of Texas jurisprudence on the subject, as well as the legislative history of the Covenants Not to Compete Act. Obviously, it will be required reading for anyone who practices in the employment or commercial litigation areas. Alex Sheshunoff Management Services, L.P. v. Kenneth Johnson and Strunk & Associates, L.P., ___ S.W.3d ___ (Tex. 2006) (Cause No. 03-1050). Technorati Tags: litigation, Texas Supreme Court, law

This morning, the Third Court of Appeals, sitting en banc on a Motion for Rehearing, issued an opinion holding that certain language in the Texas tax code which uses the word “may” is in fact mandatory, such that a successful Texas property tax protestant has an entitlement to his, her or its attorneys’ fees in making the protest. The opinion, which replaces an older opinion blogged about quite briefly here, addresses a split amongst Texas courts of appeals on the issue. Justice Patterson dissented, writing that the en banc majority “eviscerated” a distinction which ought to have given the trial court discretion on the issue. We don’t do tax law, and we would not presume to blog about it, but the opinion is an important one in that it addresses a common question of statutory construction. The opinion discusses the general rule in Texas, which is that statutory language that says “a court may award fees” means that the court has discretion to award them or not, but language that says “a prevailing party may recover fees” means that the party is entitled to fees and thus the court is without discretion on the matter. See Bocquet v. Herring, 972 S.W.2d 19 (Tex. 1998). The section of the tax code at issue here reads somewhere in between, according to the Court: “A property owner who prevails in an appeal to the court under Section 42.25 or 42.26 may be awarded reasonable attorney’s fees.” Tex. Tax Code §42.29. The Court engages in a detailed discussion of the Legislature’s use of the passive voice (which is probably better left for someone like Wayne Schiess to discuss) and ultimately decides that in the Third Court of Appeals, anyway, the attorneys’ fee award is mandatory. It is our rank speculation, based on anecdotal evidence (i.e. complaints from friends, personal experience and an article in the Austin-American Statesman), that the Travis Central Appraisal District, the defendant here, has recently gotten much more aggressive in its appraisals, at least in the personal property area (my own home’s appraisal went up roughly one-third this spring). Given that speculation, this issue may be one to watch. Aaron Rents v. Travis Central Appraisal District, ___ S.W.3d ___ (Tex. App. – Austin, 2006) (en banc) (Cause No. 03-05-00171-CV). Technorati Tags: litigation, Third Court of Appeals, law