In Re Steven Tuam Pham--Appeal from 215th District Court of Harris County
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Appeal Dismissed, Petition for Writ of Mandamus Conditionally Granted, and
Majority and Dissenting Opinions filed March 4, 2010.
In The
Fourteenth Court of Appeals
NO. 14-09-00387-CV
IN RE STEVEN TUAN PHAM
ORIGINAL PROCEEDING
WRIT OF MANDAMUS
NO. 14-08-01153-CV
STEVEN TUAN PHAM, SMITH & GARG, L.L.C., AND SARITA GARG.,
Appellants
V.
SHELLY LETNEY, Appellee
On Appeal from the 215th District Court
Harris County, Texas
Trial Court Cause No. 2008-43381
DISSENTING OPINION
In consideration of the unique relationship between attorney and client, I write this
dissenting opinion to express my concern about mandatory arbitration provisions in
attorney-client agreements.
I have no disagreement with the majority’s analysis and disposition of all issues
with the exception of Shelly Letney’s claim that the method or means of inducing her
signature on the agreement renders enforcement procedurally unconscionable. I adopt
former Fourth Court of Appeals Chief Justice Phil Hardberger’s concern that special
public-policy considerations are implicated when an attorney imposes an arbitration
provision on his or her client. See Henry v. Gonzalez, 18 S.W.3d 684, 692 (Tex. App.—
San Antonio 2000, pet. dism’d) (Hardberger, C.J., dissenting). Accordingly, I disagree
with the majority’s decision to “decline to impose a requirement that attorneys must, in
all cases, fully inform prospective clients regarding implications of an arbitration clause
in an attorney-client contract.”
Whatever public policy may be served by enforcing arbitration agreements is more
than offset by the public policy of insuring that consumers of legal services have
protection from attorneys who might take advantage of their clients. Shelly Letney, a
personal-injury claimant, is representative of the average consumer of legal services. She
should be afforded the expectation that an attorney is obligated to fully reveal and explain
potential conflicts of interests at the inception of the relationship. Moreover, the attorney
should offer the prospective client an opportunity to seek advice from another source
before signing an attorney-client agreement that contains language potentially detrimental
to the client’s interests if the client later finds it appropriate or necessary to pursue the
attorney for malpractice or other misconduct.
Under the Texas Disciplinary Rules of Professional Conduct, “A lawyer shall
explain a matter to the extent reasonably necessary to permit the client to make informed
decisions regarding the representation.” Tex. Disciplinary R. Prof’l Conduct 1.03(b),
reprinted in Tex. Gov’t Code Ann., tit. 2, subtit. G app. A (Vernon 2005) (Tex. State Bar
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R. art. X, §9). The Supreme Court of Texas Professional Ethics Committee agrees that
lawyers should be allowed to insert arbitration clauses in their client contracts as long as
“(1) the client is aware of the significant advantages and disadvantages of arbitration and
has sufficient information to permit the client to make an informed decision about
whether to agree to the arbitration provision, and (2) the arbitration provision does not
limit the lawyer’s liability for malpractice.” See Tex. Comm. On Prof’l Ethics, Op. 586
(2008).
Notwithstanding the application of settled contract law and public policy favoring
alternate dispute resolution, many respected jurists and lawyers oppose arbitration
because it is not cost effective, disgorges unwary consumers of the right to a jury trial,
and eliminates appellate review for errors of law. I remain a proponent of arbitration.
However, when the legislature and rule-making authority in the legal profession fail to
protect consumers of legal services, I believe the courts have an obligation to act because
public perception of the legal profession’s ability to self-police is not favorable.
Based on Shelly Letney’s averment that she was unaware of the arbitration
agreement and her sworn statement that petitioner did not fully explain the terms, I would
hold the trial court did not abuse its discretion by denying the petitioner’s motion to
compel arbitration. Accordingly, I respectfully dissent.
/s/
Charles W. Seymore
Justice
Panel consists of Chief Justice Hedges and Justices Seymore and Sullivan (Hedges, C.J.,
majority).
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