East Texas Salt Water Disposal Co., Inc. v. Werline – Case Brief Summary (Texas)

In East Texas Salt Water Disposal Co., Inc. v. Werline, 307 S.W.3d 267 (Tex. 2010), the parties submitted an employment dispute to final and binding arbitration at which the employee prevailed. Id. at 268.

The trial court, after considering competing motions for confirmation and vacatur of the arbitration award, found that the "the material factual findings in the award were so against the evidence . . . that they manifested gross mistakes in fact and law." Id. at 269.

The trial court consequently issued a single order denying confirmation of the arbitration and instead, vacating the award and directing rehearing before a new arbitrator. Id.

Because Tex. Civ. Prac. & Rem. Code section 171.098(a) allows appeals from orders "confirming or denying confirmation of an award" and "vacating an award without directing a rehearing" but does not expressly allow appeals from orders vacating an award and directing a rehearing, the issues presented for appellate review included the existence of interlocutory jurisdiction. Tex. Civ. Prac. & Rem. Code Ann. § 171.098(a)(3), (5) ; see Werline, 307 S.W.3d at 268; Werline v. E. Tex. Salt Walter Disposal Co., Inc., 209 S.W.3d 888, 893-96 (Tex. App.--Texarkana 2006), aff'd, 307 S.W.3d at 274.

The Court affirmed the existence of jurisdiction, concluding that:

(1) the order was not "insulated from appellate review expressly conferred under section 171.098(a)(3)"--orders denying confirmation of an arbitration award--"merely because the trial court also vacated the award and directed a rehearing," Werline, 307 S.W.3d at 270;

(2) under circumstances in which the trial court clearly rejects the award in its entirety and is not directing rehearing as a preface to confirmation, a vacatur with rehearing is the equivalent of a denial of confirmation under section 171.098(a)(3), id.;

(3) limitations on judicial review of arbitration awards would be "circumvented if re-arbitration could be ordered for reasons that would not justify denying confirmation, and appeal thereby delayed," id. at 271.