HOUSTON COURT OF APPEALS ISSUES MANDAMUS REQUIRING THE TRIAL COURT TO GRANT
HALLIBURTON'S MOTION TO COMPEL ARBITRATION OF DISPUTE OVER RETIREMENT BENEFITS.
In re Halliburton Co. (Tex.App.- Houston [1st Dist.] Jul. 2, 2009)(Sharp)(mandamus granted)
(FAA: trial court should have granted motion to compel arbitration in employment dispute)
Because the Court of Appeals finds that O’Beirne’s claims are within the scope of
a valid arbitration agreement, it holds that the trial court abused its discretion by
denying Halliburton’s motion to compel arbitration. See In re Tenet Healthcare,
Ltd., 84 S.W.3d at 765 (“A court has no discretion and must compel arbitration if
the answer to both questions is affirmative.”) The First Court of Appeals
conditionally grants relator’s petition for writ of mandamus, and directs the trial
court to vacate its February 9, 2009 order and grant relator’s motion to compel
DECISION: GRANT PETITION FOR WRIT OF MANDAMUS: Opinion by Justice Sharp
PANEL MEMBERS: Chief Justice Radack, Justices Taft and Sharp
NO AND CASE STYLE: 01-09-00150-CV In re Halliburton Company
Appeal from 133rd District Court of Harris County
Trial Court Judge: Jaclanel M. McFarland
Original Proceeding on Petition for Writ of Mandamus
TEXT OF MEMORANDUM OPINION [click for original pdf version]
By petition for writ of mandamus, relator, Halliburton Company, challenges the trial court’s February 9,
2009 order denying its motion to compel arbitration under the Federal Arbitration Act (“FAA”).
We conditionally grant the petition for writ of mandamus.
1 The underlying case is Scott O’Beirne v. Halliburton Company, No. 2008-15750, in the 80th District Court of Harris
County, Texas, the Honorable Jaclanel McFarland, presiding.
O’Beirne Begins Working for Halliburton
Real party in interest, Scott O’Beirne, worked for Halliburton Energy Services from 2000 to 2007.
2 He worked as a senior account representative from 2000 to 2003 and as a senior sales manager from 2003 to 2007.
In February 2000, O’Beirne signed the offer letter to indicate his acceptance of employment. The offer
Your acceptance of employment means you also agree to and are bound by the terms of the
Halliburton Dispute Resolution Program, effective January 1, 1998. The Halliburton Dispute
Resolution Program binds the employee and the Company to handle workplace problems through a
series of measures designed to bring timely resolution. This will be true both during your employment
and after your employment should you terminate. Enclosed for your review is a brief introduction
The offer letter stated February 17, 2000, as O’Beirne’s anticipated start date.
On February 16, 2000, O’Beirne signed a one-page document entitled “Dispute Resolution
Agreement,” which stated:
I have received a copy of the Halliburton Dispute Resolution Plan materials including Plan documents
and rules and have read, understand and agree to comply with its policies and procedures.
Accordingly, I voluntarily submit my dispute with Halliburton Energy Services to the Halliburton Dispute
Resolution Plan (DRP). Furthermore, I agree and understand that the final step in the DRP is binding
The DRP materials were an explanatory pamphlet entitled “Options for Resolution” and the “Dispute
Resolution Plan and Rules.” Together these materials outline the available options for resolving
disputes, including informal conversation (“the Open Door Option”), internal conferences,
mediation, and arbitration. The 2001 reprint of the “Dispute Resolution Plan and Rules” defines
“dispute” as “all legal and equitable claims, demands, and controversies, of whatever nature or kind,
whether in contract, tort, under statute or regulation, or some other law . . . .”
Early Retirement & Suit for Benefits
In 2007, O’Beirne took early retirement from Halliburton. In March 2008, O’Beirne sued Halliburton for
failing to pay him certain accrued benefits and bonuses that he alleged were due upon his retirement.
Halliburton responded with a general denial, pleading that O’Beirne was contractually obligated to
arbitrate his claims.
Motion to Compel
In July 2008, Halliburton moved to compel arbitration and to dismiss or stay the trial court proceedings.
Halliburton argued that O’Beirne accepted the terms and conditions of the DRP twice in writing and by
his continued employment with Halliburton after Halliburton mailed a copy of the DRP to its employees in
2001. Halliburton also argued that O’Beirne’s claims fall within the scope of the arbitration agreement
because the DRP is broadly written to include “all legal and equitable claims” including “employee
benefits or incidents of employment with the company.” Halliburton argued that O’Beirne’s claims for
unpaid bonuses and benefits were squarely within the scope of the arbitration agreement.
O’Beirne’s Response to the Motion to Compel
In response to Halliburton’s motion to compel arbitration, on September 9, 2008, O’Beirne filed an
affidavit disputing that he was bound by any arbitration agreement and disputing that he received the
DRP materials that were attached to Halliburton’s motion to compel arbitration.
Amended Motion to Compel Arbitration
On September 29, 2008, Halliburton filed an amended motion to compel arbitration, elaborating on the
Fall 2001 mail-out of the DRP materials to its employees and attaching affidavits to prove that the
materials were actually sent to O’Beirne.
In particular, Halliburton provided affidavits from Melinda Miner, Theresa Plaxco, and Ronald Garrow.
Melinda Miner testified by affidavit that she provided employee addresses to Theresa Plaxco of Verizon,
who in turn worked with National Mail Advertising, Inc. to mail the documents to Halliburton’s employees.
Miner also stated, “Following the Fall 2001 mail-out of the Program materials to all employees,
Halliburton received and maintained a record of all packets found undeliverable by the Post Office and
subsequently returned to Halliburton. The packet sent to Scott O’Beirne in 2001 was not returned.”
Theresa Plaxco testified by affidavit that she printed a cover letter and certain DRP materials for
inclusion in the mail-out and provided them, along with the employee addresses, to National Mail
Advertising for mailing. Ronald Garrow, the president of National Mail Advertising, testified by affidavit
that his company addressed the packets using the employee addresses provided to them by Theresa
Plaxco, ensured all packets bore Halliburton’s return address, and mailed them.
At a non-evidentiary hearing in February 2009, O’Beirne’s attorneys argued that he never received the
DRP materials that were mailed out, although no affidavit testimony supported that contention. The
parties also argued about the meaning of “dispute” for the arbitration agreement. After this hearing, the
trial court denied Halliburton’s motion to compel arbitration, and Halliburton filed its petition for writ of
In response to the petition for writ of mandamus, O’Beirne asserts arguments that were never
presented in the trial court. O’Beirne now argues that the DRP is illusory because Halliburton reserved
the right to amend the DRP rules by serving notice to AAA, JAMS, and CPR, but not to employees. O’
Beirne argues also that there is a fact question about whether he agreed to be bound by the 1999 DRP
because the employment-offer letter referred to the DRP that was effective on January 1, 1998. O’
Beirne contends that Halliburton provided the trial court with the wrong version of the DRP, an
argument he did not advance in the trial court. Finally, O’Beirne argues that Halliburton’s evidence
regarding the mail-out fails to establish the presumption that O’Beirne received them because no
affidavit stated that proper postage was affixed to the packets or whether the packets were mailed by U.
S. Postal Service or using a private vendor.
Standard of Review
The parties agree that the Federal Arbitration Act (“the FAA”) applies to this case. 9 U.S.C. § 2 (2008).
“A party denied the right to arbitrate under the Federal Arbitration Act by a state court has no adequate
remedy by appeal and is entitled to mandamus relief to correct a clear abuse of discretion.” In re L & L
Kempwood Assocs., L.P., 9 S.W.3d 125, 128 (Tex. 1999) (per curiam). We review de novo whether an
enforceable agreement to arbitrate exists. In re Jindal Saw, 264 S.W.3d 755, 761 (Tex. App.—Houston
[1st Dist.] 2008, orig. proceeding).
When a party asserts a right to arbitrate under the FAA, the question of whether the dispute is subject
to arbitration is determined under federal law. Prudential Secs. Inc. v. Marshall, 909 S.W.2d 896, 899
(Tex. 1995). As a matter of federal law, any doubts concerning the scope of arbitrable issues are
resolved in favor of arbitration, whether pertaining to the construction of the contract or a defense to
arbitration. See In re Serv. Corp. Int’l, 85 S.W.3d 171, 174 (Tex. 2002). In determining whether to
compel arbitration, a court must decide two issues: (1) whether a valid, enforceable arbitration
agreement exists and, (2) if so, whether the claims asserted fall within the scope of the agreement. In re
Tenet Healthcare, Ltd., 84 S.W.3d 760, 765 (Tex. App.—Houston [1st Dist.] 2002, orig. proceeding)
(citing In re Oakwood Mobile Homes, Inc., 987 S.W.2d 571, 573 (Tex. 1999)). A court has no discretion
and must compel arbitration if the answer to both questions is affirmative. In re Tenet Healthcare, Ltd.,
84 S.W.3d at 765. “An order to arbitrate should not be denied unless it can be said with positive
assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted
dispute.” Hou-Scape, Inc. v. The Honorable Russell Lloyd, 945 S.W.2d 202, 205 (Tex. App.—Houston
[1st Dist.] 1997, no writ) (citing United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582–
83, 80 S. Ct. 1347, 1353 (1960)). To determine if a claim falls within the scope of an arbitration
agreement, we focus on the facts alleged, not the causes of action asserted. Hou-Scape, 945 S.W.2d
Because we believe the 2001 version of the DRP to control in this case, we decline to address O’Beirne’
s contentions regarding his employment-offer letter, the “Dispute Resolution Agreement” that he signed
when he began working for Halliburton, and which DRP was in effect when he began working for
Halliburton. Instead we begin with the most recent version of Halliburton’s DRP relevant to this case, the
2001 DRP, which Halliburton asserts it mailed to O’Beirne.
Presumption of Receipt
A presumption of receipt arises when a party presents evidence that a document was placed in the
United States mail with the proper address and sufficient postage. Southland Life Ins. Co. v.
Greenwade, 159 S.W.2d 854, 857 (Tex. 1942); Texaco, Inc. v. Phan, 137 S.W.3d 763, 767 (Tex. App.—
Houston [1st Dist.] 2004, no pet.). “The matters of proper addressing, stamping, and mailing may be
proved by circumstantial evidence, such as the customary mailing routine of the sender’s business.”
Phan, 137 S.W.3d at 767 (citing Cooper v. Hall, 489 S.W.2d 409, 415 (Tex. Civ. App.—Amarillo 1972,
writ ref’d n.r.e.)). Testimony that the notice was not received is enough to rebut this presumption, thus
creating a fact issue to be resolved by the trial court. Greenwade, 159 S.W.2d at 857–58; Phan, 137 S.
W.3d at 767. The presumption of receipt is overcome only when the evidence supporting the contrary
inference is conclusive, or so clear, positive, and disinterested that it would be unreasonable not to
consider it conclusive. Phan, 137 S.W.3d at 767–68.
Here, Halliburton provided uncontroverted evidence that copies of the 2001 DRP materials were sent to
O’Beirne in a properly addressed packet, with Halliburton’s return address. In addition, Halliburton
provided evidence that they kept track of packets returned to Halliburton by the Post Office as
undeliverable and that O’Beirne’s packet was not returned. These uncontroverted facts are
circumstantial evidence that proper postage was affixed to O’Beirne’s packet, supporting the
presumption of receipt.
O’Beirne presented no evidence to the trial court that he did not receive the DRP materials mailed to
him in 2001. His affidavit “disputes” that he received the plan materials that Halliburton asserted it
provided to him in 2000 when he was hired, but it does not address the materials mailed in 2001.
3 Although O’Beirne challenges the interpretation and applicability of the “Dispute Resolution Agreement” and the offer
letter that he signed in February 2000, he admits in his mandamus response that he did sign both documents.
Rather, O’Beirne argues that Halliburton did not establish the presumption of receipt because it did not
provide direct evidence of proper postage. Because this can be—and has been—proven by
circumstantial evidence, we hold that Halliburton established the presumption that O’Beirne received
the 2001 DRP materials.
Agreement to Arbitrate
The 2001 DRP provided, “Employment or continued employment after the Effective Date of this Plan
constitutes consent by both the Employee and the Company to be bound by this Plan, both during the
employment and after termination of employment.” The 2001 DRP defines the “effective date” as June
15, 1998, as amended as of August 15, 1999. O’Beirne does not dispute that he was employed by
Halliburton after the effective date of the plan. Therefore, O’Beirne accepted the agreement by
performance, i.e., his employment.
Accordingly, we hold that a valid agreement to arbitrate exists between Halliburton and O’Beirne.
Scope of the Agreement
We next consider whether O’Beirne’s claims fall within the scope of the agreement to arbitrate. The
2001 DRP materials state, “All Disputes not otherwise settled by the Parties shall be finally and
conclusively resolved under this Plan and the Rules.” “Dispute” is defined as: “all legal and equitable
claims, demands, and controversies, of whatever nature or kind, whether in contract, tort, under statute
or regulation, or some other law . . . including , but not limited to, any matters with respect to . . . (2) the
employment . . . of an Employee, including the terms, conditions, or termination of such employment . . .
[or] (3) employee benefits or incidents of employment with the Company. . . .” O’Beirne has sued
Halliburton for bonuses and other monies he claims were due to him upon his retirement from
Halliburton. Because his claims deal with his employment, termination of employment, and benefits of
such employment, we hold that O’Beirne’s claims are within the scope of the arbitration agreement.
Because O’Beirne’s claims are within the scope of a valid arbitration agreement, we hold that the trial
court abused its discretion by denying Halliburton’s motion to compel arbitration. See In re Tenet
Healthcare, Ltd., 84 S.W.3d at 765 (“A court has no discretion and must compel arbitration if the answer
to both questions is affirmative.”)
We conditionally grant relator’s petition for writ of mandamus, and we direct the trial court to vacate its
February 9, 2009 order and grant relator’s motion to compel arbitration. We are confident the trial court
will promptly comply, and our writ will issue only if it does not.
We vacate the temporary stay granted in this case on March 10, 2009.
Panel consists of Chief Justice Radack and Justices Sharp and Taft.
4 The Honorable Tim Taft, retired justice, Court of Appeals for the First District of Texas, participating
ALSO SEE: Other appellate decisions in disputes over arbitration from the Houston Courts of Appeals