Glazer's Wholesale Distributors v. Heineken

• Decision Date: 29 June 2001
• Docket Number: No. 05-99-01685-CV.,05-99-01685-CV.
• Citation: 95 S.W.3d 286
• Parties: GLAZER'S WHOLESALE DISTRIBUTORS, INC., Appellant, v. HEINEKEN USA, INC., Heineken Brouwerijen B.V., and Amstel Brouwerij B.V., Appellees. In re Glazer's Wholesale Distributors, Inc.
• Court: Texas Court of Appeals

95 S.W.3d 286

GLAZER'S WHOLESALE DISTRIBUTORS, INC., Appellant, v. HEINEKEN USA, INC., Heineken Brouwerijen B.V., and Amstel Brouwerij B.V., Appellees In re Glazer's Wholesale Distributors, Inc.

No. 05-99-01685-CV.

Court of Appeals of Texas, Dallas.

June 29, 2001.

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Alan N. Greenspan, Jackson & Walker, L.L.P., William David Ellerman, Dallas, for Appellant.

Scott R. Hoyt, Gibson, Dunn & Crutcher, Dallas, for Appellee.

Before Justices LAGARDE, MOSELEY, and FITZGERALD.

OPINION

FITZGERALD, Justice.

Glazer's Wholesale Distributors, Inc. brings an interlocutory appeal of the trial court's order granting Heineken USA, Inc., Heineken Brouwerijen B.V., and Amstel Brouwerij B.V.'s motion to compel arbitration. Glazer's also brings a petition for writ of mandamus requesting that we order the trial court to set aside its order compelling arbitration. This Court consolidated the two cases. We dismiss the appeal for want of jurisdiction. Because we determine the statute requiring arbitration, as applied in this case, unconstitutionally delegates judicial authority in violation of article five, section one of the Texas Constitution, we conditionally grant the petition for writ of mandamus.

FACTUAL BACKGROUND

Glazer's is a distributor of alcoholic beverages and was hired by Heineken Brouwerijen B.V. and Amstel Brouwerij B.V. (collectively "Heineken") to distribute their products. Glazer's distributorship contracts provide they are terminable only "for good cause."¹ On January 21, 1999, Heineken notified Glazer's that it was terminating the distributorship contracts due to dissatisfaction with Glazer's performance.

Glazer's brought suit against Heineken and its local agent, Heineken USA, Inc., and against another distributor, Miller of Dallas, Inc., alleging common-law causes of action of breach of contract, conspiracy, breach of fiduciary duty, tortious interference with contract, fraud, and negligent misrepresentation. Glazer's also sued Heineken alleging a statutory cause of action for violating the Beer Industry Fair Dealing Law. See TEX. ALCO. BEV.CODE ANN. §§ 102.71-.81 (Vernon 1995) (hereafter, "the Act"). Glazer's alleged that Heineken violated section 102.74 because it lacked good cause to terminate the contracts. Glazer's demanded compensation for the value of the distributorship business relating to Heineken's brands.

Section 102.74 of the Act prohibits a beer manufacturer from terminating a distributorship contract unless it has good cause and has afforded the distributor the opportunity to cure the problems constituting good cause. See TEX. ALCO. BEV.CODE ANN. § 102.74 (Vernon 1995). If the manufacturer terminates the contract without good cause, it must pay the distributor the fair market value of the distributorship business relating to the terminated brands. See id. § 102.77(a); see also Ace Sales Co. Cerveceria Modelo, S.A. de C.V., 739 S.W.2d 442, 444 (Tex.App. — Corpus Christi 1987, writ denied). Glazer's sought actual and exemplary damages, attorney's fees, declaratory judgments, and temporary and permanent injunctions reinstating Glazer's right to distribute the Heineken brands.

Heineken answered and moved the trial court to compel arbitration pursuant to section 102.77(b) of the Act, which provides that if the manufacturer and distributor cannot agree on whether "good cause" for termination exists or on the value of the distributorship business,

the matter may, at the option of either the distributor or manufacturer, be submitted to three arbitrators.... The award of the arbitrators shall be binding on the parties unless appealed within 10 days from the date of the award. All proceedings on appeal shall be in accordance with and governed by the Texas General Arbitration Act, as amended.

TEX. ALCO. BEV.CODE ANN. § 102.77(b) (Vernon 1995). The trial court granted the motion and ordered the parties to arbitrate only Glazer's claim "that the Heineken Defendants violated section 102.74 of the Texas Alcoholic Beverage Code ... for determination of whether or not good cause existed for cancellation of the distribution contracts ... and the amount of the reasonable compensation, if any, to be paid for the value of the Plaintiff's business...." The trial court stayed the litigation of Glazer's other causes of action pending resolution of the arbitrable issues. Glazer's filed an interlocutory appeal of this order and a petition for writ of mandamus requesting that we order the trial court to set aside the order compelling arbitration.

JURISDICTION OVER THE INTERLOCUTORY APPEAL

Ordinarily, a party may not appeal an action until it obtains a final judgment. Pursuant to section 102.77(b) of the Act, appellant's right of appeal is governed by the Texas General Arbitration Act, which only permits a party to bring an interlocutory appeal of an order:

(1) denying an application to compel arbitration ...;

(2) granting an application to stay arbitration ...;

(3) confirming or denying confirmation of an award;

(4) modifying or correcting an award; or

(5) vacating an award without directing a rehearing.

TEX. CIV. PRAC. & REM.CODE ANN. § 171.098(a)(1)-(5) (Vernon Supp.2001). An order granting a motion to compel arbitration is not one of the permitted categories for an interlocutory appeal under the Texas General Arbitration Act. See id.; Lipshy Motorcars, Inc. v. Sovereign Assocs., Inc., 944 S.W.2d 68, 69 (Tex. App. — Dallas 1997, no writ); see also Materials Evolution Dev., USA, Inc. v. Jablonowski, 949 S.W.2d 31, 33 (Tex.App. — San Antonio 1997, no writ).

Glazer's argues that the supreme court, in Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266 (Tex.1992) (orig.proceeding), held the Texas General Arbitration Act permits an interlocutory appeal of an order compelling arbitration. In Anglin, the court did state that the Texas General Arbitration Act allows a party "to appeal from an interlocutory order granting or denying a request to compel arbitration." Id. at 271-72 (emphasis added). However, this Court has held that language to be dicta insofar as it purports to authorize an appeal of an order compelling arbitration. See Lipsky Motorcars, Inc., 944 S.W.2d at 70; see also In re Van Blarcum, 19 S.W.3d 484, 488-89 n. 7 (Tex.App. — Corpus Christi 2000, orig. proceeding) (citing Lipshy Motorcars).

The Texas General Arbitration Act clearly does not authorize Glazer's to bring an interlocutory appeal of the order compelling arbitration. Accordingly, we lack jurisdiction over the appeal. See id. We dismiss the appeal for want of jurisdiction.

MANDAMUS

Mandamus is an extraordinary remedy and is available only in limited circumstances of manifest and urgent necessity. See Holloway v. Fifth Court of Appeals, 767 S.W.2d 680, 684 (Tex.1989) (orig.proceeding). The writ of mandamus will issue only to correct a clear abuse of discretion or violation of duty imposed by law, when no adequate remedy at law exists. See In re L & L Kempwood Assocs., L.P., 9 S.W.3d 125, 128 (Tex.1999) (orig.proceeding) (per curiam); Walker v. Packer, 827 S.W.2d 833, 839 (Tex.1992) (orig.proceeding); Jampole v. Touchy, 673 S.W.2d 569, 572-73 (Tex.1984) (orig.proceeding).

An abuse of discretion occurs when the trial court's decision is arbitrary and unreasonable "as to amount to a clear and prejudicial error of law." Harris v. Jones, 8 S.W.3d 383, 385 (Tex.App. — El Paso1999, no pet.); Walker, 827 S.W.2d at 839; Mercedes-Benz Credit Corp. v. Rhyne, 925 S.W.2d 664, 666 (Tex.1996). The relator must establish that the facts and law allow for only one decision. See Walker, 827 S.W.2d at 839; In re Clark, 977 S.W.2d 152, 155 (Tex.App. — Houston [14th Dist.] 1998, orig. proceeding). When the trial court, in exercising otherwise discretionary authority, "has but one course to follow and one way to decide, discretionary power is effectively null." Harris, 8 S.W.3d at 385, 386; United States Fire Ins. Co. v. Millard, 847 S.W.2d 668, 671 (Tex.App. — Houston [1st Dist.] 1993, orig. proceeding). The trial court does not have any "discretion" in determining what the law is or applying the law to the facts in the case; therefore, appellate review is much less deferential regarding a trial court's determination of the legal principles controlling its ruling. See In re Perritt, 973 S.W.2d 776, 780 (Tex.App. — Texarkana 1998, orig. proceeding); City of Lubbock v. Hancock, 940 S.W.2d 123, 124 (Tex.App. — Amarillo 1996, orig. proceeding). Thus, "a clear failure by the trial court to analyze or apply the law correctly will constitute an abuse of discretion, and may result in appellate reversal by extraordinary writ." Walker, 827 S.W.2d at 840; see In re Godt, 28 S.W.3d 732, 738 (Tex.App. — Corpus Christi 2000, orig. proceeding); In re Jebbia, 26 S.W.3d 753, 756 (Tex.App. — Houston [14th Dist.] 2000, orig. proceeding); Weber v. Hall, 929 S.W.2d 138, 140 (Tex.App. — Houston [14th Dist.] 1996, orig. proceeding). Mandamus is available to correct judicial action contrary to well-settled law derived from binding precedent from a court of superior jurisdiction. See Kozacki v. Knize, 883 S.W.2d 760, 762 (Tex.App. — Waco 1994, orig. proceeding) (per curiam); City of Lubbock, 940 S.W.2d at 125; see also In re Smith Barney, Inc., 975 S.W.2d 593, 597 (Tex.1998) (doctrine of stare decisis requires lower courts to follow supreme court precedents) (quoting 21 Int'l Holdings, Inc. v. Westinghouse Elec. Corp., 856 S.W.2d 479, 486 (Tex.App. — San Antonio 1993, no writ) (Peeples, J., concurring), overruled on other grounds by In re Smith Barney, Inc., 975 S.W.2d at 598); Penrod Drilling Corp. v. Williams, 868 S.W.2d 294, 296 (Tex.1993) (stare decisis rule restated). Mandamus is also appropriate in cases of first impression where an abuse of discretion is found. See Huie v. DeShazo, 922 S.W.2d 920, 927-28 (Tex.1996) (orig.proceeding); In re News Am. Publ'g, Inc., 974 S.W.2d 97, 105 (Tex.App. —...