The Courage Company, L.L.C. v. The Chemshare Corporation--Appeal from 113th District Court of Harris County

Dissenting Opinion Issued August 22, 2002, Withdrawn; Revised Dissenting Opinion filed November 27, 2002

Dissenting Opinion Issued August 22, 2002, Withdrawn; Revised Dissenting Opinion filed November 27, 2002.

In The

Fourteenth Court of Appeals

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NO. 14-00-00798-CV

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THE COURAGE COMPANY, L.L.C., Appellant

V.

THE CHEMSHARE CORPORATION, Appellee

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On Appeal from the 113th District Court

Harris County, Texas

Trial Court Cause No. 00-15656

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R E V I S E D D I S S E N T I N G O P I N I O N

The dissenting opinion issued in this case on August 22, 2002, is withdrawn, and the following dissenting opinion is issued in its place.

The majority opinion essentially holds that a foreign judgment can be denied recognition on the ground that the foreign proceeding was contrary to an agreement to settle the dispute other than by proceedings in the foreign court[1] even though that court was never apprised of any such agreement. I disagree with this conclusion for two reasons.

First, I believe it is contrary to the rule that a judgment debtor may not rely on a ground for nonrecognition of a foreign judgment that the party had a right, but failed, to assert in the foreign proceeding.[2] Second, and similarly, a party with a right to arbitration has a choice whether to invoke it and may see an advantage in refraining from doing so in a particular case. Where, as here, a party has failed to invoke its claim to arbitration in a foreign proceeding,[3] I do not think it can be said that the resulting foreign judgment is contrary to an agreement to settle the dispute by arbitration when that court never had a chance to let the dispute be settled in accordance with the agreement.

If the majority holding is correct, a party with an arguable claim to arbitration would be well advised to refrain from raising it in a foreign lawsuit so as to assure that any adverse foreign judgment would not be recognized in a United States court. Because I do not believe this is supported by law or logic, I would not affirm the trial court s denial of recognition of the Japanese judgment on the ground that the Japanese proceeding was contrary to the parties agreement to arbitrate.

/s/ Richard H. Edelman

Justice

Judgment rendered and Revised Dissenting Opinion filed November 27, 2002.

Panel consists of Justices Anderson, Hudson, and Edelman.

Publish Tex. R. App. P. 47.3(b).

[1] See Tex. Civ. Prac. & Rem. Code Ann. 36.005(b)(5) (Vernon 1997).

[2] See Dart v. Balaam, 953 S.W.2d 478, 480 (Tex. App. Fort Worth 1997, no writ).

[3] In this case, whether Chemshare s failure to urge its right to arbitration in the Japanese proceeding would constitute a waiver of that right under the Texas case law cited in the majority opinion is academic. The fact remains that whatever opportunity Chemshare had to assert its arbitration claim in the Japanese court is now gone, and the circumstances set forth in the majority opinion show no other reason for Chemshare s loss of its arbitration claim than a failure to invoke it (i.e., along with the other defensive matters it asserted subject to its jurisdictional challenge).