Become New Investments, L.L.C. v. Ashleigh Emmett

COURT OF APPEALS
EIGHTH DISTRICT OF TEXAS
EL PASO, TEXAS

BECOME NEW INVESTMENTS, L.L.C., § No. 08-24-00106-CV

Appellant, § Appeal from the

v. § 98th District Court

ASHLEIGH EMMETT, § of Austin, Texas

Appellee. § (TC# D-1-GN-23-004385)

MEMORANDUM OPINION

Appellee Ashleigh Emmett (Ashleigh) filed suit against Appellant Become New

Investments, L.L.C. (BNI), alleging, among other things, various defects in the construction of a

home in Austin that BNI built and sold to Ashleigh and her husband, Daniel Emmett (Daniel).1

BNI filed a motion to compel arbitration, contending Ashleigh and Daniel were bound by an

arbitration agreement contained in a builders warranty policy BNI purchased at the time of the

sale, which contained express warranties covering the home. Ashleigh opposed the motion,

arguing the warranty was not properly issued, and even if it had been, she could not be bound by

the arbitration agreement contained therein because only Daniel signed the application for the

1
Because some of the individuals in the opinion share the same last name, we refer to them by their first names. In
doing so, we intend no disrespect.
warranty at closing. Alternatively, she maintained her claims fall outside the scope of the

arbitration agreement. The trial court denied the motion, and this interlocutory appeal followed.2

We conclude that because the application was part of a unified instrument for the sale of

the home to which Ashleigh was a party, and because the builders warranty was later issued and

never cancelled by the Emmetts within the 30-day period specified in the warranty, Ashleigh is

bound by the warranty’s arbitration agreement. We further conclude that deciding the arbitrability

of Ashleigh’s claims is within the purview of the arbitrator. Therefore, we reverse and remand to

the trial court to submit Ashleigh’s claims to arbitration in accordance with the provisions in the

Warranty.

I. FACTUAL BACKGROUND

A. The Emmetts sign a contract to purchase a new home from BNI

In February 2021, the Emmetts signed an agreement to purchase a home that BNI’s owners,

Jeffrey and Mary Mills, were in the process of building (the Sales Contract).3 Under the Sales

Contract, BNI was to “complete all improvements to the Property with due diligence in accordance

with the Construction Documents[,]” which were signed by the parties and expressly incorporated

by reference into the contract. Compass RE Texas, L.L.C. (Compass) was the listing broker firm

and became the intermediary for the sale between the Emmetts and BNI. Compass appointed

Phyllis Patek as the listing associate for BNI, and Amanda and Alex Pettitt as the selling associates

for the Emmetts.

2
The appeal was transferred to this Court from the Third Court of Appeals pursuant to the Texas Supreme Court
docket equalization efforts. See Tex. Gov’t Code Ann. § 73.001. We follow the precedent of that court to the extent it
conflicts with our own. See Tex. R. App. P. 41.3.
3
The purchase price was $3,800,000.

2
B. BNI asks where to send the builders warranty policy

Although the Sales Contract itself did not contain any express warranties, it allowed the

parties to enter into a “separate writing” containing such warranties. Specifically, under the

“warranty” heading, the contract stated, “[e]xcept as expressly set forth in this contract, a separate

writing, or provided by law, Seller makes no other express warranties”4 (emphasis added). BNI

contends that prior to the closing date, it informed the Emmetts of its intent to purchase a builders

warranty policy containing express warranties covering the property, pointing to a series of emails

between the parties’ real estate agents. In an email dated April 6, 2021, containing the subject line

“[the subject property address]-Builders Warranty Info,” Mary Mills asked Patek for the “buyer’s

current mailing address for the Builders Warranty info.” She indicated BNI had previously used

the realtor’s physical address and the buyers’ phone and email address to communicate with them

but wanted to know the buyers’ preference in this instance. Patek apparently forwarded the email

to Amanda and Alex Pettitt, and Alex replied: “We can use our address or even the office address

if you want.” Later that day, Patek sent a follow-up email to Mary Mills, stating, “Let’s use the

buyers[’] agent office address” and provided the Emmetts’ cell phone numbers.

In an email dated May 13, 2021, Mary and Jeffrey Mills informed the closing agent at the

title company that they were sending a copy of a “Builders Warranty Application” along with

instructions for filling out the application. The email stated that per the instructions, the buyers

were to sign three copies of the application at closing, one of which was to be submitted to

Centricity, the company issuing the policy, along with the enrollment fee. The Millses further

stated in the email that they would bring a check written to Centricity to cover the fee. Patek was

copied on the email.

4
We agree with BNI that this provision in the contract allowed the parties to enter into a “separate writing” containing
express warranties, such as a builders warranty policy.

3
C. Daniel signs the builders warranty policy application at closing

At the closing on May 24, 2021, in addition to the Sales Contract, the Emmetts were

presented with several other documents, including a “Warranty Coverage Application” for a

builders policy to be issued by Centricity (the Warranty Application).5 The Warranty Application

described the policy as a “10 Yr Structural Warranty + 1 Yr Workmanship & Materials/2 Yr

Systems Warranty.” It further provided the address of the new home the Emmetts were purchasing

from BNI and listed the “homeowner” as Daniel Emmett and the “co-owner” as Ashleigh Emmett.

The Warranty Application specified an “enrollment fee” of $2,500.

The first page of the Warranty Application contained a line labeled “Signatures,”

providing: “HOMEOWNER(S): I/we acknowledge that by signing this application l/we affirm that

I/we have read and understand the Important Homeowner’s Acknowledgement on Page 2[.]” (the

Acknowledgment). The Acknowledgement specified that if the home was enrolled in the

Centricity Warranty Program, the homeowners were “accept[ing] the terms and conditions

contained therein,” which included an “exclusive, final and binding alternative dispute resolution

processes, including but not limited to arbitration[.]” The Acknowledgement stated: “By accepting

this warranty, I/we are agreeing to waive my/our right to a trial by either judge or jury in a court

of law.” It further stated that the “Warranty Documents” would be mailed to the homeowners, who

would have 30 days to cancel the policy if they were not completely satisfied, and that the failure

to do so would waive their right to assert the “inapplicability” of the Warranty’s terms. The

“WARRANTY MAILING INSTRUCTIONS” stated: “Mail Warranty To New Home Address Above.”

5
The parties signed a number of other documents during the closing, including a “Final Customer Walk-Thru
Approval and Punch List,” indicating the Emmetts had inspected the property and improvements and found them
“fully completed pursuant to [their] contract with [BNI] and satisfactory to [them]” and “accept[ed] the Improvements
and Property in their present condition” with some listed exceptions.

4
At the closing, Daniel signed the Warranty Application next to the line, “Homeowner

Signature,” but Ashleigh did not. Below Daniel’s signature was a line for the homeowner email

with Daniel’s name typed in, under which it states, “This email address is where we will send your

warranty documents. Please print clearly.”

BNI paid the $2,500 enrollment fee and, as discussed in more detail below, Centricity

thereafter issued a builders warranty policy covering the Emmetts’ new home (the Centricity

Warranty or Warranty). However, the parties dispute whether the Centricity Warranty was mailed

to the Emmetts at their new home, whether it was sent to Daniel’s email address, and/or whether

the Emmetts actually received a copy of the Warranty before their attorney later requested it.

D. The Emmetts complain of issues with the home and retain an attorney

After moving into the home, the Emmetts, either jointly or through Ashleigh, contacted the

Millses about problems with the home on several occasions. Ashleigh contends she did so without

knowledge of the Centricity Warranty, believing her claims were made under various implied

warranties inherent in the Sales Contract. Dissatisfied with BNI’s efforts to address the problems,

the Emmetts retained attorney Jo Ann Merica, who sent a letter to the Millses on January 26, 2022,

stating she was representing both Daniel and Ashleigh Emmett “in connection with apparent

construction defects in the new home they purchased from [BNI] in May of 202l.”

Jeffrey Mills responded by letters dated January 28, 2022, and February 4, 2022, stating he

was willing to address the Emmetts’ issues, but expressing concern that they had apparently begun

addressing issues not previously reported to BNI. He explained that BNI could not “assume any

responsibility for issues that [they] were not aware of, were not allowed to assess or address, or

for any consequences that flow, directly, or indirectly, from work [they] had no input into or

control over.” In his February letter, he informed Merica that the Emmetts had agreed to abide by

5
Texas Property Code Chapter 27 requiring notice of construction defects prior to filing suit to give

the builder the chance to address the issues. He suggested that they meet to address the Emmetts’

concerns.

Merica responded in a February 7, 2022 letter telling Jeffrey Mills that a meeting would be

“premature at this time,” as she wished to wait until “third-party professionals have evaluated the

issues with the residence and provided repair recommendations.” Merica informed Mills of her

intent to give BNI written notice of the problems under Texas Property Code § 27.004, adding that

the Emmetts had given BNI numerous opportunities to fix the problems and it had become

necessary to their health and safety that they fix the issues themselves.6

E. BNI provides a copy of the Centricity Warranty to the Emmetts’ attorney

In the same letter, Merica stated, “In the meantime, I would appreciate it if you would

forward a copy of the written warranty promised to the Emmetts—they are having trouble locating

it.” Mary Mills emailed Merica on February 9, 2022, stating she was providing “an electronic copy

of the Builders Warranty for [the subject property] per the request made in your letter of Feb 7.”

F. The Centricity Warranty terms

The Centricity Warranty on the Emmetts’ home, as supplied to Merica, contained a

welcome provision, stating that the Emmetts’ builder “cared enough to provide limited warranty

coverage” for their new home through Centricity. It listed the address of the Emmetts’ newly

constructed home, identified both of the Emmetts as the homeowners, and identified BNI as the

builder. It further informed the Emmetts that the “warranty belongs to your property address,” and

6
Section 27.004(a) of the Property Code provides: “Before the 60th day preceding the date a claimant seeking from
a contractor damages or other relief arising from a construction defect initiates an action, the claimant shall give
written notice by certified mail, return receipt requested, to the contractor, at the contractor’s last known address,
specifying in reasonable detail the construction defects that are the subject of the complaint.” Tex. Prop. Code Ann.
§ 27.004(a).

6
that if they were to sell the home, “the warranty document stays with the home for the new

owners.”

The Centricity Warranty “set[] forth a commencement date of May 17, 2021,” and

contained a 30-day cancellation notice in bolded font:

Be sure to read these documents to understand the benefits and limitations of
Your warranty. You may return the warranty for cancellation within 30 days
of Your receipt of it. If canceled Centricity will refund the full Warranty
Enrollment Fee paid to the Builder. Cancellation of this warranty does not
extend or alter the Builder’s responsibilities.

It included a one-year warranty period for workmanship and materials, a two-year warranty

period for systems, and a ten-year warranty period for major structural defects, with an aggregate

limit of one million dollars. It provided a detailed list of what workmanship, materials, and systems

were covered as well as what would be considered major structural defects.

The Centricity Warranty specified that by accepting enrollment in the Centricity Warranty

program, the homeowners agree to the method and manner of repair and/or replacement selected

by the Builder or Centricity and waive all other express and implied warranties from the Builder,

“including but not limited to warranties of habitability, merchantability, fitness for a particular

purpose and/or good and workmanlike construction.” The Warranty provided that, in the event of

a defect in construction, the homeowners “must contact Your Builder as soon as possible upon

your detecting a defect and before the expiration of the applicable Warranty Period.” It further

provided that “[t]he Builder or Centricity, if necessary, shall have the option to repair, replace or

pay You the reasonable cost of repair and/or replacement of any covered defect.” And the Warranty

stated that in the event of a covered defect, the homeowners’ “sole remedy . . . is as prescribed in

the terms and conditions of the Centricity Warranty issued on the Home.”

7
The Warranty contained detailed dispute resolution procedures culminating in binding

arbitration:

In the event any Dispute under any Centricity warranty, including without
limitation, a claim of subrogation, negligent or intentional misrepresentation or
nondisclosure in the inducement, breach of any alleged duty of good faith and fair
dealing, and/or any dispute over the scope of this Arbitration Provision, cannot be
resolved by one of the Alternative Dispute Resolution processes described herein,
You, the Builder and Centricity agree to submit the Dispute to binding arbitration.
You will have the right to select the arbitration company from the list of approved
arbitration companies Centricity will provide to You when arbitration is requested.
The arbitration will be conducted under the arbitration company’s rules in effect at
the time of the arbitration.

The decision of the arbitrator shall be final and binding on all parties and may be
entered as a judgment in any State or Federal court of competent jurisdiction. By
accepting the warranty, You are agreeing to waive Your right to a trial by
either judge or jury in a court of law.

G. The Emmetts’ attorney gives BNI notice under the Property Code

On May 5, 2022, almost three months after Mary Mills emailed Merica a copy of the

Warranty, Merica sent a letter by certified mail to Jeffrey and Mary Mills, again stating that she

had been retained by both Ashleigh and Daniel Emmett with respect to the construction defects on

the home they had purchased from BNI. The letter contained the subject line, “NOTICE

PURSUANT TO TEXAS PROPERTY CODE § 27.004; [subject property],” and stated, “Please let

this letter serve as written notice of the construction defects and costs incurred to date in connection

with the residence[.]” Merica chronicled the issues the Emmetts claimed they had faced since

purchasing the home and attached “Exhibit A,” which “details additional items of defective

construction that have become evident in the Emmetts’ one year warranty period. Exhibit A and

the reports[] specify the construction defects that are the subject of my clients’ complaints, as

required by Tex. Prop. Code § 27.004(a).”

8
H. BNI addresses the applicability of the Centricity Warranty

On September 15, 2022, Jeffrey Mills sent Merica a letter with the subject line containing

the Emmetts’ address, followed by: “Centricity Warranty Agreement and August 18, 2022 Offer

Clarification.” In the letter, Jeffrey informed Merica that the Emmetts’ claims “are subject to and

governed by the Centricity Warranty Agreement,” asserting it is the “sole remedy . . . in the event

of a defect in Your Home or in the real property upon which it is situated.” Jeffrey indicated he

had been in contact with Centricity concerning the Emmetts’ claims and believed the Emmetts’

claims all fell within the scope of the Warranty. He nevertheless referenced an offer that BNI had

previously made to settle the Emmetts’ claims and stated he was willing to extend its settlement

offer until September 19, 2022. However, he warned that if the offer was not accepted, BNI would

proceed in accordance with the terms of the Centricity Warranty in addressing any requested

repairs.

I. Merica acknowledges receiving the Centricity Warranty but denies
its applicability

In a September 18, 2022 letter to Jeffrey Mills, Merica stated she was responding to his

claim that the Emmetts had waived their right to bring a claim for damages based on the

“boilerplate language” in the Centricity Warranty, maintaining the Warranty was “never furnished

to my clients” or mentioned in any of their agreements. Merica explained that after requesting a

copy of the Warranty in February 2022, she “confirmed that [the Warranty] had never been

received by [her] clients’ realtor.” Merica asserted there was therefore “no effective waiver of any

right to litigate this matter or the implied warranty of good and workmanlike construction,” and

“the failure to disclose these limitations and waivers in a purported Builder’s Warranty constitutes

a deceptive trade practice.”

9
Merica went on to accept certain terms in BNI’s settlement offer but reject others,

contending certain repairs had been satisfactorily made while others had not. She attached an

exhibit chronicling the various issues that the Emmetts believed still needed to be addressed.

J. Centricity provides evidence that it emailed the Centricity Warranty to Daniel in
June 2021

After Merica informed BNI that her clients had never received the Centricity Warranty,

Mary Mills apparently contacted Centricity to inquire whether the Warranty had been sent to them.

Sue Maas, a Centricity employee, responded in a September 19, 2022 email stating that Centricity

provides documents to a homeowner via email unless an email is not provided. Maas explained

that Centricity “record[s] when a warranty document is sent to a new homebuyer in our system . . .

[and] records if the email [was] sent successfully.” According to Maas, the “mailing instruction”

on the application indicating that the Warranty would be sent to the buyers’ home address is

“simply to confirm the owner’s physical mailing address in the event we do not receive email

information.” Maas provided documentation from Centricity’s system demonstrating that on

June 9, 2021, the Warranty documents were successfully sent to Daniel’s email address as

provided on the homeowners’ application.

K. Jeffrey Mills raises the arbitration agreement in the Centricity Warranty

Jeffrey Mills wrote to Merica on September 26, 2022, asserting the Warranty was “clearly

a binding agreement” and stating he was “surprised” the Emmetts were “attempting to disavow

it.” He maintained BNI had paid for the Centricity Warranty prior to closing, and the Warranty

Application, which he attached to his letter, was signed at closing. Jeffrey stated that BNI had

confirmed with the warranty company that the Emmetts were “enrolled” in its program, and that

on June 19, 2021, the Warranty had been sent to Daniel via email at the address provided in his

application. He also noted that Merica was given a copy of the Centricity Warranty in February

10
2022, and despite the cancellation provision, neither Merica nor the Emmetts attempted to cancel

within 30 days of receipt. Finally, Jeffrey pointed out that the Centricity Warranty contained an

arbitration provision which waived the right to bring a judicial proceeding.

II. PROCEDURAL BACKGROUND

A. Ashleigh files her lawsuit

On August 14, 2023, Ashleigh, represented by Merica, filed suit against BNI, complaining

that immediately upon moving into the home, “problems with the construction of the house became

apparent.” Ashleigh listed several alleged construction defects, many of which involved water

leaks leading to mold making the home uninhabitable and “unsuitable for its intended use as a

home.”7 According to Ashleigh, BNI attempted to fix the alleged defects on various occasions,

but they were not properly repaired.

Ashleigh claimed BNI “misrepresented the quality, condition and suitability and fitness of

the Residence,” and it “was not built in accordance with all applicable plans, specifications, design

professionals’ recommendations, manufacturer’s installation instructions, building codes, and

industry standards, was not built in a good and workmanlike manner, was not free from defects

and was not suited for its intended use.” Ashleigh listed several causes of action, including

negligence, claiming BNI was negligent both in constructing the home and in making requested

repairs; breach of contract, claiming BNI failed to construct the home in accordance with the

construction documents to which the parties had agreed; and breach of the implied warranties that

the home was of “habitable quality,” that it was “built in a good and workmanlike manner,” that

7
Ashleigh claimed, among other things, that there were drainage issues between the pool and the house, which caused
water to flow onto their porch; “defective sealing of the roof vent,” which caused leakage into the home when it rained;
the home was “subject to water penetration through numerous avenues due to defects in construction” causing mold
issues in the home; the house had “severe settlement” issues; there was “improper backfill and subgrade compaction
affecting drainage [and a] lack of proper sloping grade away from the foundation”; there were problems with the septic
system; the garage door had structural issues that caused it to sag; and stucco was improperly installed.

11
repairs would be performed in a good and workmanlike manner, and that construction would be

“adequately supervised.”

Ashleigh also sought a declaratory judgment that she had “not waived any implied

warranties” and was not subject to the “limitations of the Centricity Warranty,” as she did not sign

the application for the Warranty. In addition, she asserted that “the terms of the Centricity warranty

were not disclosed to Daniel or Ashleigh Emmett at or prior to closing.” She further alleged that

“[t]he application for warranty expressly provided that the warranty would later be mailed to the

address of the insured property,” but “[i]t never was.”

Finally, Ashleigh alleged BNI violated the Deceptive Trade Practices Act (the DTPA) by

failing to disclose the terms of the Warranty, by misrepresenting that it had complied with the

terms of the construction contract, and by its various breaches.

In addition to her request for a declaratory judgment, Ashleigh sought money damages and

attorney’s fees.

B. BNI moves to compel arbitration

In September 2023, BNI filed a response in which it denied Ashleigh’s allegations and

further alleged that her claims were subject to arbitration. BNI then filed a motion to compel

arbitration, contending the Centricity Warranty required the homeowners to submit any disputes

between them, the builder, and Centricity to binding arbitration. BNI adamantly disagreed with

Ashleigh’s position that she was not subject to the Centricity Warranty and attached an affidavit

from Jeffrey Mills, together with numerous exhibits in support of its contention.

(1) Affidavit of Jeffrey Mills

In his affidavit, Jeffrey Mills recalled that after the closing, the Emmetts had several

complaints, which BNI addressed. He asserted that at some point, the Emmetts’ attorney became

12
their “primary conduit for communication,” and Mills provided her with a copy of the Centricity

Warranty in February 2022. Thereafter, he averred, the Emmetts, through their attorney, continued

to “request repairs and other minor work during the one-year warranty period, which BNI

continued to address.” He further averred that no one informed BNI that the Emmetts had taken

any steps to cancel the Centricity Warranty. And he asserted that upon inquiry, a Centricity

employee had informed BNI in August 2022 that the Emmetts were enrolled in the Warranty

program, as they had not cancelled it.

Jeffrey attested to several exhibits in his affidavit, including the Sales Contract; various

change orders requested by Ashleigh and/or Daniel prior to closing; the April 6, 2021 email

exchange between Mary Mills and Patek regarding where to send the Warranty; a copy of the

$2,500 check BNI paid to Centricity to enroll the Emmetts in the Warranty program; the Warranty

Application signed by Daniel; the Centricity Warranty itself; the September 19, 2022 email

exchange between Mary Mills and Sue Maas in which Maas informed Mary that the Centricity

Warranty had been emailed to Daniel; and correspondence between Jeffrey Mills and Merica.

(2) BNI’s theories for binding Ashleigh to the arbitration agreement as
a nonsignatory

In its motion, BNI alleged the following theories upon which Ashleigh was bound to the

arbitration agreement despite her failure to sign the Warranty Application:

• Ashleigh could be considered a party to the arbitration agreement, given her signature
on the Sales Contract, asserting that the Sales Contract and Warranty Application
constitute a single, unified instrument;

• Ashleigh was bound to the arbitration agreement by the doctrine of incorporation by
reference;

• Ashleigh was bound to the agreement by the doctrine of direct benefits estoppel; and

• Ashleigh was bound as a third-party beneficiary to the agreement.

13
BNI further maintained that Ashleigh’s claims fell within the scope of the agreement,

contending the arbitration agreement covered “all disputes between the parties having a significant

relationship to the contract regardless of the label attached to the dispute.” According to BNI, all

of Ashleigh’s claims, regardless of their labels, centered on alleged construction defects or

workmanship issues covered by the Centricity Warranty.

C. Ashleigh responds to the motion to compel arbitration

In her response to the motion to compel arbitration, Ashleigh denied the existence of a

valid arbitration agreement, contending the application Daniel signed at closing was “conditional”

and only provided that the homeowners would be subject to the arbitration provision if the home

was enrolled in the Centricity Warranty Program. Ashleigh argued the home was not properly

enrolled in the program, as the application itself stated that certain conditions precedent had to be

met before the home would be enrolled—such as requiring that all blanks must be filled in—which

she maintained did not happen because Ashleigh did not fill in a blank with her signature. She

further argued that the Centricity Warranty had to be mailed to the homeowners before it could

take effect, and she claims it was never mailed. Ashleigh reasoned that if the Warranty never

became effective, neither did the arbitration agreement.

Ashleigh further asserted that even if the Warranty’s arbitration provision were valid, she

was not bound by it, as she never signed the application for the Warranty, its terms were not

disclosed to her or Daniel prior to closing, and they were never given a copy of the Warranty either

before or after the closing. 8 Ashleigh also expressly denied that she could be bound as a

nonsignatory under the Warranty under any theory raised by BNI. Finally, she argued that her

8
Ashleigh did not contend that BNI, which paid $2,500 for the Warranty, failed to provide sufficient consideration
for its issuance.

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claims, which included negligence, breach of contract, breach of implied warranties, and violation

of the DTPA, did not fall within the scope of the arbitration provision.

(1) Ashleigh’s unsworn declaration

In an unsworn declaration in support of her response, Ashleigh acknowledged she was

present at closing and Daniel signed the Warranty Application at closing, but she claimed she did

not see a copy of the Warranty Application until “it was attached to correspondence sent to [their]

attorney by Jeff Mills on September 26, 2022.” Ashleigh averred that she and Daniel were not

given a “sample” copy of the Centricity Warranty before or at closing, and that “[n]o final issued

Centricity warranty was ever delivered or received by mail at [the subject home].” She therefore

claimed that they had no opportunity to cancel within the requisite 30-day period.

Ashleigh asserted that before hiring an attorney, she communicated about the construction

issues with Mary Mills, who never mentioned the Centricity Warranty. Ashleigh said she believed

she was requesting repairs under implied warranties that she assumed came with the home.

Ashleigh recalled that in February 2022, when her attorney asked her if there was a “written

warranty issued on the house[,]” she looked through her documents and was unable to locate one.

She stated she called Amanda Pettitt, and Pettitt informed her that she had “received an e-mail

before closing mentioning ‘builder warranty information’ but had never received anything along

those lines.” According to Ashleigh, despite all of the correspondence between Merica and Jeffrey

Mills, BNI did not refer to the Centricity Warranty until September 2022, and she had not been

aware until then of BNI’s position that the Warranty applied to the repair requests. She concluded

by averring that she never “accepted” the terms of the Centricity Warranty and did not want the

“supposed benefits of the Centricity Warranty for our $3,800,000 home.”

15
(2) Merica’s unsworn declaration

Merica also provided an unsworn declaration in which she stated that she began

communicating with BNI, through Jeffrey Mills, on January 26, 2022, but despite their lengthy

communications, “[a]t no time prior to the letter of September 15, 2024 [sic] . . . did BNI

communicate that it considered the Emmett’s [sic] claims to be subject to and governed by the

Centricity Warranty Agreement.”9 According to Merica, “BNI also did not suggest that furnishing

an electronic copy of the warranty to [her] in February of 2022 triggered the beginning of a 30-

day cancellation period for the Emmetts.”

(3) Amanda Pettitt’s unsworn declaration

Amanda Pettitt provided an unsworn declaration stating that she was one of the Compass

realtors who represented the Emmetts in the purchase. She recalled Ashleigh contacting her in

February 2022 asking if she had a copy of a builders warranty, whereupon she searched her records

but could not find any such copy. According to Pettitt, “No other documents were delivered to

[her], in any manner, at any place or time concerning a builder’s warranty on [the subject

property].”

(4) Alex Pettitt’s unsworn declaration

Alex Pettitt provided an unsworn declaration in which he stated that he was also one of the

Compass realtors who represented the Emmetts in the purchase. Regarding the Warranty

documents, he stated:

No documents were delivered to me, in any manner, at any place or time concerning
information about a builder’s warranty on the [subject] property except for an e-
mail in April 2021 requesting an address where information could be sent. No
documents concerning a builder’s warranty on the [subject] property were ever
delivered by me to Ashleigh or Daniel Emmett.

9
Although Merica refers to the parties’ letters as dated 2024, the record reflects that they were all dated 2022.

16
(5) Daniel’s unsworn declaration

Finally, Daniel Emmett provided an unsworn declaration stating he was “not given any

proposed terms of an express warranty on our home or any sample warranty before or at closing.”

He asserted he had “no recollection of receiving an e-mail after closing containing a home

warranty” and “know[s]” he “did not open such an e-mail or print or view any warranty

documents.”

Daniel stated that after being notified in September 2022 that the Warranty had been

emailed to him on June 19, 2021, he searched his emails and found no record that the Warranty

was sent to him on that date, adding that it may have gone to his spam folder, which he deleted

regularly. He further asserted that he “never received a mailed copy of final warranty documents

at [his] home address.”

D. BNI’s supplement

In a supplement to its motion to compel arbitration, BNI provided a second affidavit from

Jeffrey Mills, in which he averred, “Before closing, I personally informed Alex Pettitt that the

property was being sold with a 1-2-10 express builder’s warranty.” Prior to closing, he further

averred, Mary Mills also informed Alex—who he pointed out was an experienced builder

himself—that BNI would be issuing a builders warranty on the property, but neither the Pettitts

nor the Emmetts requested a copy. Jeffrey noted that the title company was furnished with the

Warranty Application prior to closing with instructions for both buyers to sign the application. He

further noted that because BNI closed first, he was unaware Ashleigh had not signed the

application, but claimed that had he known, BNI would not have closed.

17
E. Ashleigh’s supplement

Ashleigh thereafter provided her own supplement in opposition to the motion, which

included another affidavit from Alex Pettitt, averring that while representing the Emmetts, he

spoke very briefly with Jeffrey and Mary Mills on a few occasions prior to closing. However, Alex

claimed neither of them informed him that a Warranty was being issued for the property and again

asserted “[n]o documents were delivered to [him], in any manner, at any place or time concerning

the terms of an express builder’s warranty on the [subject] property.”

F. The trial court’s ruling

Following a non-evidentiary hearing, the trial court denied BNI’s motion to compel

arbitration without specifying its reasons. Neither party requested findings of fact or conclusions

of law. BNI appealed, and this Court stayed the trial court proceedings pending appeal.

III. ISSUES ON APPEAL

Although not raised as a separate issue on appeal, BNI contends “a valid arbitration

agreement exists,” as the Centricity Warranty containing the arbitration provisions was properly

issued and effective regardless of whether Ashleigh signed the application or whether Centricity

mailed the Warranty to the home. And BNI argues that Ashleigh is bound to the arbitration

agreement despite her failure to sign the Warranty Application based on four separate theories,

raised as four separate issues: (1) the application was part of a “unified transaction entered for the

same purpose—BNI’s sale and the Emmetts’ purchase of the home[,]” and Ashleigh’s signature

on the sales contract was sufficient; (2) the doctrine of “incorporation by reference,” as the Sales

Contract made reference to the Warranty when it provided that “[e]xcept as expressly set forth in

this contract, a separate writing, or provided by law, Seller makes no other express warranties”;

(3) the doctrine of direct benefits estoppel, based on Ashleigh’s seeking and accepting benefits of

18
both the Sales Contract and the Warranty; and (4) Ashleigh was a third-party beneficiary to the

Warranty. BNI further maintains that all of Ashleigh’s claims fall within the scope of the

arbitration agreement, or alternatively, “the arbitration agreement clearly and unmistakably

delegates disputes as to the scope of the arbitration provisions to the arbitrator.”

IV. WHETHER THE CENTRICITY WARRANTY WAS EFFECTIVELY ISSUED

We first address the question of whether a valid arbitration agreement exists that could

bind either of the Emmetts.

A. Applicable law and standard of review

Arbitration is a contractual proceeding by which the parties, in order to obtain a speedy

and inexpensive final disposition of disputed matters, consent to submit the controversy to

arbitrators for resolution. See In re Phelps Dodge Magnet Wire Co., 225 S.W.3d 599, 605

(Tex. App.—El Paso 2005, no pet.) (citing Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 268

(Tex. 1992)). A party seeking to compel arbitration must prove that (1) a valid and enforceable

arbitration agreement exists, and (2) the claims raised fall within the agreement’s scope. Baby

Dolls Topless Saloons, Inc. v. Sotero, 642 S.W.3d 583, 585–86 (Tex. 2022) (per curiam). If the

party seeking arbitration meets its two-pronged burden to establish the agreement’s validity and

scope, the burden shifts to the party opposing arbitration to raise a valid defense to the agreement’s

enforcement; absent evidence supporting such a defense, the trial court must compel arbitration.

J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 227–28 (Tex. 2003). Stated otherwise, if the

moving party establishes these two requirements and the non-moving party fails to present

evidence of a valid defense to the agreement’s enforcement, it is error for the trial court to deny

the motion. See GSC Wholesale, LLC v. Young, 654 S.W.3d 558, 563 (Tex. App.—Houston

[14th Dist.] 2022, pet. denied) (citing In re Poly-America, L.P., 262 S.W.3d 337, 354 (Tex. 2008)).

19
When contesting whether a valid arbitration agreement exists within a broader contract,

“[a] party can challenge (1) the validity of the contract as a whole, (2) the validity of the arbitration

provision specifically, and (3) whether an agreement exists at all.” Sotero, 642 S.W.3d at 586

(citing RSL Funding, LLC v. Newsome, 569 S.W.3d 116, 124 (Tex. 2018)). Because an arbitration

provision is severable from a contract, “a challenge to the larger contract’s validity—the first type

above—is determined by the arbitrator.” Id. “The second type of challenge—to the validity of the

arbitration provision specifically—is for the court to decide unless clearly and unmistakably

delegated to the arbitrator.” Id. (citing Robinson v. Home Owners Mgmt. Enters., 590 S.W.3d 518,

525 (Tex. 2019)). “Challenges of the third type—that the contract ‘never came into being’—are

decided by the court.” Id. (citing RSL Funding, 569 S.W.3d at 124).

Because arbitration is a creature of contract between consenting parties, a court must

determine whether an enforceable agreement to arbitrate exists by applying principles of state

contract law. See In re Kellogg Brown & Root, Inc., 166 S.W.3d 732, 738 (Tex. 2005) (orig.

proceeding) (“Under the FAA, ordinary principles of state contract law determine whether there is

a valid agreement to arbitrate.”); Jody James Farms, JV v. Altman Group, Inc., 547 S.W.3d 624,

629 (Tex. 2018) (recognizing that “[a]rbitration is a creature of contract between consenting

parties”). Thus, the party attempting to compel arbitration must show that the arbitration agreement

meets all requisite contract elements. J.M. Davidson, Inc., 128 S.W.3d at 228; see also In re Palm

Harbor Homes, Inc., 195 S.W.3d 672, 676 (Tex. 2006) (orig. proceeding) (recognizing that in

determining the validity of arbitration agreements subject to the FAA, we apply ordinary state law

contract principles that govern the formation of contracts).

A trial court’s determination regarding the validity and scope of an arbitration agreement

are questions of law that we review de novo. In re Labatt Food Serv., L.P., 279 S.W.3d 640, 643

20
(Tex. 2009) (orig. proceeding) (recognizing that a trial court’s determination as to whether a valid

arbitration agreement exists and whether the claims fall within the scope of an arbitration

agreement are legal determinations subject to de novo review). When a trial court does not state

the basis for its decision to deny a motion to compel arbitration, “we must uphold the trial court’s

ruling on any legal theory supported by the evidence.” In Estate of Guerrero, 465 S.W.3d 693,

701 (Tex. App.—Houston [14th Dist.] 2015, pet. denied) (citing Worford v. Stamper, 801 S.W.2d

108, 109 (Tex. 1990); Inland Sea, Inc. v. Castro, 420 S.W.3d 55, 57–59 (Tex. App.—El Paso

2012, pet. denied) (affirming denial of motion to compel arbitration on alternative ground where

order did not specify the basis for the ruling)).

B. Analysis

On appeal, Ashleigh renews her argument that a valid arbitration agreement does not exist

because the Warranty containing the arbitration agreement never came into existence, asserting

that two conditions precedent set forth in the Warranty Application were never satisfied. See

generally Allstate Ins. Co. v. Irwin, 627 S.W.3d 263, 270 (Tex. 2021) (recognizing that “[a]

condition precedent may be either a condition to the formation of a contract or to an obligation to

perform an existing agreement”). Ashleigh maintains that (1) the application provided that all

blanks in the application were to be filled out, and (2) the Warranty was to be mailed to the

Emmetts’ home. Ashleigh contends neither condition was satisfied, therefore, the Warranty was

not properly issued, and by extension, the arbitration agreement therein “never became effective.”

We treat this as a question of law and address Ashleigh’s arguments separately to determine

whether the Warranty did in fact become “effective.” See Sotero, 642 S.W.3d at 586 (recognizing

that question of whether a contract containing an arbitration agreement “exists at all” is a question

of law for the court to decide).

21
(1) Failure to fill in blanks on the application

Because the application Daniel signed contained the following provision in bolded font

making it clear that the application was not the Warranty itself, Ashleigh argues, she had to sign

the application, i.e., fill in the blank signature line and fill in all the blanks for the Warranty to

properly issue and come into effect:

This application is to enroll your new home in Centricity express limited
warranty coverage: IT IS NOT YOUR NEW HOME WARRANTY nor is it a
substitute for your homeowners insurance. Unless all blanks are completed,
the application is signed, and the warranty fee is paid, your home will not be
enrolled.

As BNI points out, however, there are at least two reasons why this argument fails. First,

the requirement that the parties must sign the agreement and fill in all blank lines is a condition

precedent that, if not met, would have allowed Centricity to refuse to issue the Warranty, but did

not give the Emmetts the right to claim that the Warranty, once issued, did not become effective.

And second, as set forth above, Centricity did in fact issue the Warranty in May 2021.

Our sister court in Houston was faced with a similar scenario in which a married couple

was seeking to avoid the application of a builders warranty policy, where the wife had signed an

application for the warranty on the home prior to the couple’s marriage. In re Hill, No. 01-02-

00186-CV, 2002 WL 1165032, at *2 (Tex. App.—Houston [1st Dist.] May 30, 2002, orig.

proceeding). As in the case before us, the warranty application in Hill provided that if the

application was not completely filled out, “the warranty was invalid.” Id. The warranty company

issued the policy, but after discovering defects in the subject home and wishing to sue the builder

for claims outside the scope of the warranty, the couple argued the warranty could not be imposed

on them because several blanks were left unfilled in the application, including the box indicating

that the signatory had read and understood the terms of the warranty. Id. The Houston court

22
rejected their argument, explaining that the applicant “was required to complete and submit the

warranty application form . . . for the benefit of [the warranty company] who would be bound by

the warranty, because the application provided [the warranty company] with information about the

subject of the warranty.” Id. In other words, the court concluded that “the right to invalidate the

warranty for lack of completeness belonged to [the warranty company], not to [the buyer].”10 Id.

In the present case, too, the Warranty Application gave Centricity the right to refuse to

enroll the home in its program if it there were blanks in the application or missing signatures. But

Centricity chose to accept and approve the application, and further accepted BNI’s payment of the

necessary fee, which was never refunded. We therefore agree with BNI that despite the blanks and

Ashleigh’s failure to sign the application, the home was properly enrolled in the Warranty

program.

As discussed in more detail below, at that point, the Emmetts had the right to cancel the

Warranty within 30 days of receipt of the Warranty documents if they did not wish to retain it.

(2) Failure to mail the Warranty documents to the Emmetts’ home

Ashleigh, however, contends Centricity did not follow the correct steps to provide her and

Daniel with a copy of the Warranty documents after their home was enrolled in the program, and

the Warranty therefore never became effective. Ashleigh points out that the Warranty Application

provided that after enrollment in the program, Centricity was to mail the Warranty documents to

the Emmetts’ home. Ashleigh argues that even though the record reflects that the Warranty was

emailed to Daniel in June 2021 and was later emailed to Ashleigh and Daniel’s attorney in

10
The dissent contends that Hill is inapposite as in that case, the wife—unlike Ashleigh—signed the warranty
application, while leaving other portions of the application blank. But the opinion in Hill is applicable to the point at
issue, as the holding provides that it was “the applicant, who was required to complete and submit the warranty
application form,” and that “[t]his requirement was for the benefit” of the warranty company. In re Hill, No. 01-02-
00186-CV, 2002 WL 1165032, at *2 (Tex. App.—Houston [1st Dist.] May 30, 2002, orig. proceeding). The court
therefore recognized that “the right to invalidate the warranty for lack of completeness belonged to [the warranty
company] not to [the wife].” Id. As in Hill, it was Centricity’s right to reject the application, and not the Emmetts’.

23
February 2022, because the mailing condition in the Warranty Application was not satisfied, the

Warranty was not validly issued. According to Ashleigh, “[u]nder the plain language of this

document, only if the applicant did not cancel the warranty within the 30 days after receiving it in

the mail would an agreement to the terms and conditions (including the arbitration provision) be

formed.” We disagree.

As a preliminary matter, Ashleigh’s argument does not require us to determine what would

occur if the Emmetts had never received a copy of the Warranty and were thereby deprived of any

opportunity to review its terms and cancel within 30 days of receipt. Instead, we must only decide

whether mailing the Warranty to the Emmetts’ home address—as opposed to sending it via

email—was a condition precedent to its validity and enforceability. We conclude that it was not.

The application’s “Warranty Mailing Instructions,” which provided that the Warranty was

to be mailed to the buyers’ “New Home Address,” did not make mailing the Warranty through the

U.S. mail a condition precedent to the Warranty’s issuance or enforceability. The Warranty

Application also contained a provision indicating that the Warranty would be sent to the buyer’s

email address, as provided. In addition, although the acknowledgment stated that Centricity would

only “mail” the Warranty documents if it agreed to enroll the homeowner, the relevant part of the

acknowledgment provided that the homeowners understood that “upon receipt of the final

warranty documents,” they would have “30 days to review the warranty terms and conditions and

return it for cancellation if not completely satisfied.” Thus, regardless of how the Emmetts received

the Warranty documents, the acknowledgment contemplated that the Warranty would be

enforceable if they received the documents and did not cancel the Warranty within 30 days.

As set forth above, the record contains documentation that Centricity sent the Warranty in

June 2021 to the email address Daniel provided at closing. But even if the trial court believed

24
Daniel did not receive the Warranty at that time, the record contains undisputed evidence that the

Emmetts’ attorney requested and received the Warranty documents in February 2022. As discussed

in more detail below because an attorney-client relationship is an agency relationship, we find

Merica’s receipt of the warranty documents sufficient to constitute receipt to her clients. See

Nathan A. Watson Co. v. Employers Mut. Cas. Co., 218 S.W.3d 797, 802 (Tex. App.—Fort Worth

2007, no pet.) (citing Gavenda v. Strata Energy, Inc., 705 S.W.2d 690, 693 (Tex. 1986) (because

an attorney-client relationship is an agency relationship, an “attorney’s acts and omissions within

the scope of his or her employment are regarded as the client’s acts”)). As such, the Emmetts had

30 days thereafter to cancel the Warranty. Nothing in the record suggests that the Emmetts or their

attorney made any attempt to do so until September 2022, when Merica informed BNI (but not

Centricity) that she believed her clients could make claims outside the scope of the Warranty.11

In sum, we conclude that the Centricity Warranty was properly issued and was not timely

cancelled. In turn, we conclude that the arbitration provision is valid and enforceable. 12

11
Despite acknowledging that she received the Centricity Warranty in February 2022, Merica asserted in her affidavit
that BNI did not inform her at that time that “furnishing the electronic copy of the warranty triggered the beginning
of a 30-day cancellation period for the Emmetts.” As set forth above, however, both the Acknowledgment Daniel
signed and the Warranty itself made it clear that the homeowners’ failure to cancel the warranty within 30 days of
receipt would be considered an acceptance by the homebuyers. Accordingly, BNI’s failure to alert Merica to the need
to cancel the Warranty has no impact on our analysis.
12
The dissent appears to believe that the arbitration agreement could not be enforced against either of the Emmetts
because neither Daniel nor Ashleigh were put on notice of the arbitration provision’s terms, as they were not given a
copy of the Warranty itself at closing. We agree that a party ordinarily cannot be bound by an arbitration agreement
in a contract unless she is given notice of the terms of the agreement at the time of the contract’s formation. See A-1
Freeman Moving & Storage LLC v. Ortiz Galindo, No. 08-23-00001-CV, 2023 WL 5486236, at *5 (Tex. App.—El
Paso Aug. 23, 2023, no pet.) (mem. op.) (recognizing that employee cannot be bound by an arbitration agreement
absent evidence that she was given notice of the agreement and assented to its terms). However, we do not believe
BNI was required to give the Emmetts a copy of the actual Warranty documents themselves or their terms at the time
they executed the Sales Contract in order to satisfy the notice requirement. It is well-established that a party may be
put on notice of an arbitration agreement contained in a contract if he is given an adequate “summary” of the
agreement’s terms. Id. at *5–6 (citing In re Halliburton Co., 80 S.W.3d 566, 569 (Tex. 2002) (orig. proceeding)
(concluding that the requirement that an employer provide an employee with “unequivocal notice of the terms of the
arbitration agreement and its mandatory nature” can be accomplished by providing a “summary of the agreement to
arbitrate.”)). Here, the Acknowledgement section in the Warranty Application provided such a summary. Specifically,
it stated that the Warranty to be issued included “exclusive, final and binding alternative dispute resolution processes,
including but not limited to arbitration,” and that by accepting the Warranty, “I/we are agreeing to waive my/our right

25
Accordingly, Ashleigh’s argument that the Centricity Warranty was never properly issued could

not have served as a basis for the trial court’s decision to deny BNI’s motion to compel arbitration.

V. WHETHER ASHLEIGH CAN BE CONSIDERED A PARTY TO THE
ARBITRATION AGREEMENT DESPITE HER FAILURE
TO SIGN THE WARRANTY APPLICATION

Having found that the Centricity Warranty was properly issued and was never cancelled,

we next consider BNI’s argument that Ashleigh can be considered a party to the Warranty, even

though only Daniel signed the Warranty Application, under the theory that the Warranty

Application and the Sales Contract must be construed as a unified instrument. Although not raised

as a separate issue, we also consider BNI’s argument that Ashleigh can be considered a party to

the arbitration agreement contained in the Centricity Warranty based on her conduct demonstrating

assent to be bound by the terms of the Warranty.

A. Applicable law

The “uniform instrument” theory provides that when appropriate, “a court may determine,

as a matter of law, that multiple separate contracts, documents, and agreements were part of a

single, unified instrument.” Rieder v. Woods, 603 S.W.3d 86, 94–95 (Tex. 2020) (internal

quotation marks omitted). As the Texas Supreme Court has explained, “[i]n determining whether

multiple agreements are part and parcel of a unified instrument, a court may consider whether each

written agreement and instrument was ‘a necessary part of the same transaction.’” Id. (citing Bd.

of Ins. Comm’rs v. Great S. Life Ins. Co., 239 S.W.2d 803, 809 (Tex. 1951)). Thus, “[t]he general

rule is that separate instruments or contracts executed at the same time, for the same purpose, and

in the course of the same transaction are to be considered as one instrument, and are to be read and

to a trial by either judge or jury in a court of law.” We find this to be a sufficient “summary” of the arbitration’s terms
so as to put the Emmetts on notice that they were agreeing to binding arbitration at the time they entered into the Sales
Contract.

26
construed together.” Rieder, 603 S.W.3d at 94, n.35 (quoting Jones v. Kelley, 614 S.W.2d 95, 98

(Tex. 1981)). Even if parties “execute[] the instruments at different times and the instruments do

not expressly refer to each other,” if they nevertheless pertain to the same transaction, courts may

still construe the documents together “as if they were part of a single, unified instrument.” Fort

Worth Indep. Sch. Dist, 22 S.W.3d at 840; In re Laibe Corp., 307 S.W.3d 314, 317 (Tex. 2010)

(orig. proceeding) (recognizing same). However, the Texas Supreme Court has cautioned that

when “construing multiple documents together, courts must do so with caution, bearing in mind

that tethering documents to each other is ‘simply a device for ascertaining and giving effect to the

intention of the parties and cannot be applied arbitrarily and without regard to the realities of the

situation.’” Rieder, 603 S.W.3d at 94–95 (quoting Miles v. Martin, 321 S.W.2d 62, 65

(Tex. 1959)).

B. The Warranty Application was part of the same transaction as the parties’
Sales Contract

As BNI points out, our sister court has applied this concept to a situation in which the

parties executed multiple documents at the closing of a home purchase, finding that the various

documents were part of the same transaction and therefore could properly be construed together

as a singled unified instrument. See Christerson v. Speer, No. 01-16-00469-CV, 2017 WL 1520449,

at *5, n.2 (Tex. App.—Houston [1st Dist.] Apr. 27, 2017, pet. denied) (mem. op.) (citing Fort

Worth Indep. Sch. Dist., 22 S.W.3d at 840) (concluding that the various documents executed by

the parties at closing could be construed together as a single unified instrument to determine the

parties’ obligations); see also Famous Water Co., L.P. v. Aquio Sols. Intermediate Holdings, LLC,

No. 02-23-00329-CV, 2024 WL 2971686, at *10–11 (Tex. App.—Fort Worth June 13, 2024, no

pet.) (mem. op.) (construing various documents executed by the parties at different times as a

single, unified instrument, where they all related to the same transaction and were entered for the

27
purpose of consummating the sale of the subject property). BNI contends the parties intended for

the Warranty Application and the Sales Contract to be executed at the same time, as part of the

same transaction, and we should similarly conclude that the parties intended for them to be

construed together as part of a single, unified instrument. We agree.

First, the parties’ conduct and that of their real estate agents prior to and at closing

demonstrate an intent that the Warranty Application be executed as part of the sales transaction.

As set forth above, prior to closing, the real estate agents representing both parties discussed where

to send the builders warranty information. Although the Emmetts’ agents denied ever seeing the

Warranty itself, they did not, and could not, deny they were aware that a builders warranty was

contemplated as part of the sale transaction. In addition, the record contains the email Mary Mills

sent the title agent, with a copy to the Millses’ real estate agent, that had directions to provide the

Warranty Application to the Emmetts at closing. It stated they would bring a check for the Warranty

Application with them to closing. The record further contains undisputed evidence that the Millses

brought the check with them to closing and Daniel signed the Warranty Application.

Moreover, contrary to Ashleigh’s argument, we find nothing in the parties’ Sales Contract

and the Warranty Application which would preclude a finding that the Warranty Application was

not part and parcel of the sales transaction. First, Ashleigh points to the section in the Sales

Contract providing: “Except as expressly set forth in this contract, a separate writing, or provided

by law, Seller makes no other express warranties.” Although we agree with Ashleigh that this

provision did not “represent that the builder actually made an express warranty in a separate

writing,” it nevertheless contemplated that such a warranty could be issued. The fact that the

Emmetts were presented with an application for such an express warranty as part of their closing

28
documents suggests that the parties intended to treat the Warranty Application and the Sales

Contract as being part and parcel of the same transaction, i.e., as a unified instrument.

The dissent appears to believe that the two documents cannot be construed together as a

unified instrument because the Sales Contract did not incorporate by reference either the Warranty

Application or the Centricity Warranty into the contract. But this argument conflates two

concepts.13 A document, even an unsigned one, may be incorporated by reference into a contract

when the parties “plainly refer to the other document” in a contract. St. David’s Healthcare P’ship,

LP v. Fuller, 627 S.W.3d 707, 712 (Tex. App.—Austin 2021, pet. dism’d) (citing In re 24R, Inc.,

324 S.W.3d 564, 567 (Tex. 2010) (orig. proceeding)); see also In re Prudential Ins. Co. of Am.,

148 S.W.3d 124, 135 (Tex. 2004) (orig. proceeding) (holding that lease’s jury waiver was

incorporated by reference into guaranty agreement, which “plainly refer[red]” to the lease when

guarantors agreed to “faithfully perform and fulfill all of [the] terms, covenants, conditions,

provisions, and agreements” of the lease if the partnership defaulted).

However, as explained above, the Texas Supreme Court has repeatedly stated that under a

unified instrument theory, no such express reference is required. See In re Laibe Corp., 307 S.W.3d

at 317 (citing Fort Worth Indep. Sch. Dist., 22 S.W.3d at 840; Rieder, 603 S.W.3d at 94

(“instruments pertaining to the same transaction may be read together to ascertain the parties’

intent, even if the parties executed the instruments at different times and the instruments do not

13
The dissent relies on Owen v. Hendricks, 433 S.W.2d 164, 166 (Tex. 1968) for the proposition that the unified
instrument doctrine is merely an “extension” of the doctrine of incorporation by reference. But the court in Owen only
examined the doctrine of incorporation by reference and did not address the unified instrument doctrine. Owen, 433
S.W.2d at 166. Moreover, the dissent criticizes our reliance on several cases that it contends depended on the doctrine
of incorporation by reference in concluding that two separate documents could be construed together as a single,
unified document; in all of those cases, the courts expressly held that two documents could be viewed as a single,
unified instrument, depending on the parties’ intent, even when the two documents do not expressly refer to each
other. See, e.g., Stevenson v. Roberts, No. 14-20-00075-CV, 2021 WL 2460577, at *3 (Tex. App.—Houston [14th
Dist.] June 17, 2021, no pet.) (mem. op.); Christerson v. Speer, No. 01-16-00469-CV, 2017 WL 1520449, at *5 (Tex.
App.—Houston [1st Dist.] Apr. 27, 2017, pet. denied) (mem. op.); Famous Water Co., L.P. v. Aquio Sols. Intermediate
Holdings, LLC, No. 02-23-00329-CV, 2024 WL 2971686, at *10–11 (Tex. App.—Fort Worth June 13, 2024, no pet.).

29
expressly refer to each other”); Copano Energy, LLC v. Bujnoch, 593 S.W.3d 721, 727 (Tex. 2020)

(“multiple writings may comprise a contract even if the parties executed the instruments at

different times and the instruments do not expressly refer to each other”) (internal quotation marks

omitted).

The court has further recognized that in determining whether two documents were intended

to be treated as a single, unified instrument, a court may review the “language of both agreements

and the facts and circumstances surrounding their execution.” Rieder, 603 S.W.3d at 95. The

dissent, however, contends we are prohibited from considering “parol evidence” to discern the

parties’ intent, and we must focus solely on the language set forth in the Sales Contract itself. But

“[t]he [parol evidence] rule does not prohibit consideration of surrounding circumstances that

inform, rather than vary from or contradict, the contract text.” See Houston Expl. Co. v. Wellington

Underwriting Agencies, Ltd., 352 S.W.3d 462, 469 (Tex. 2011); see also Kachina Pipeline Co.,

Inc. v. Lillis, 471 S.W.3d 445, 450 (Tex. 2015) (court “may consider the facts and circumstances

surrounding a contract, including “the commercial or other setting in which the contract was

negotiated and other objectively determinable factors that give context to the parties’ transaction”);

Carrizo Oil & Gas, Inc. v. Barrow-Shaver Res. Co., 516 S.W.3d 89, 96 (Tex. App.—Tyler 2017),

aff’d on other grounds, 590 S.W.3d 471 (Tex. 2019) (recognizing that “evidence the [parties’]

negotiations and preliminary drafts of [their] agreement was not barred from admissibility by the

parol evidence rule”). The dissent also relies on Southerland v. Ne. Datsun, Inc., 659 S.W.2d 889,

891–92 (Tex. App.—El Paso 1983, no writ) for the proposition that a party may not introduce parol

evidence of a warranty agreement that was not contained in the parties’ sales agreement. But in

that case, the parties’ agreement provided that no warranties existed unless they were in writing,

and contrary to the express terms of the contract, the plaintiff sought to introduce evidence of an

30
oral agreement. Id. at 892. We therefore held that such parol evidence was not admissible to vary

the contract’s express terms. Id. Here, however, we are not faced with an oral agreement that would

have been prohibited by the Sales Contract. Instead, we are tasked with determining whether the

written Warranty Application, which was contemplated by the Sales Contract, can be considered

part of a single, unified instrument. Therefore, contrary to the dissent’s concerns, we are not

varying any terms of the Sales Contract by examining whether the parties intended for the Warranty

to be considered along with the Sales Contract as part of a unified instrument.

Accordingly, in considering the emails between the parties’ real estate agents regarding the

Warranty Application prior to the sale, the fact that the Sale Contract expressly contemplated the

possibility that the parties could enter into an express warranty, and the fact that the Warranty

Application was presented to the parties at closing along with all other pertinent documents

pertaining to the sale, we conclude that the parties intended for the Sales Contract and the Warranty

Application to be read together as a single, unified instrument.

C. The effect of the merger clause

For similar reasons, we disagree with Ashleigh and the dissent that the Sales Contract’s

merger clause prevents us from treating the two documents as a unified instrument. The merger

clause states that “[t]his contract contains the entire agreement of the parties and cannot be changed

except by their written agreement.” The merger clause then lists three “addenda” considered part

of the contract, including a third-party financing addendum, an addendum giving the Emmetts the

right to cancel the contract upon receiving the lender’s appraisal, and the notice of the parties’

intermediary real estate agreement. According to Ashleigh, because neither the Warranty

Application or the Warranty were listed as addenda, the parties did not contemplate treating the

Warranty Application as part of the Sales Contract. We disagree.

31
We recognize that in some instances, including a merger clause in a contract may warrant

a finding that the parties did not intend for two separate documents to be read together, such as

when the documents involve and bind different parties, contain entirely separate and distinct rights

and obligations, and “make no reference to each other whatsoever.” See Rieder, 603 S.W.3d at 95.

Here, however, BNI and the Emmetts were the only two parties named in both the Sales Contract

and the Warranty Application, and both documents relate to the same transaction, i.e., the rights

and obligations of the parties to the sale of the home. The Sales Contract contemplates that a

builders warranty may be issued in a separate agreement, and the Warranty Application makes

multiple direct references to the parties’ Sales Contract. The Warranty Application begins by

providing that “[t]his application is to enroll your new home” in Centricity’s Warranty program,

identifying BNI as the “builder,” and the Emmetts as the “homeowners” at the address of the home

they were purchasing. It then lists the closing date as May 17, 2021; lists the closing contract price

as $3,800,000; and indicates that the sale was financed. The Warranty Application states that

“certain items and events are not covered by this warranty” and that the homeowners “understand

that the Warranty Limit, the maximum aggregate total amount Centricity is liable for under the

warranty for all claims may be less than the Closing Contract Price of the Home.” In other words,

the terms of the Warranty Application are inextricably intertwined with the Sales Contract, and the

two documents were not intended to function separately from each other; in fact, the Warranty

Application has no independent existence or meaning outside the context of the sale of the home

and the contract therefor.14 See generally Stevenson v. Roberts, No. 14-20-00075-CV, 2021 WL

14
Both Ashleigh and the dissent also point to language in the Centricity Warranty that they contend render it a separate
document which cannot be considered part of the Sales Contract, noting it contains provisions stating the Warranty is
“independent” of any other agreements between the homeowners and the builder, at least for purposes of applying the
dispute resolution provisions in the Warranty, and “the Warranty Confirmation(s), any Warranty Amendment(s), Your
Warranty Coverage Application, and the Warranty Document form Your entire Warranty Contract.” But the question
of whether the Centricity Warranty is considered a separate document from the Sales Contract does not affect our
analysis of whether the parties intended for the Warranty Application and the Sales Contract to be read together as

32
2460577, at *3 (Tex. App.—Houston [14th Dist.] June 17, 2021, no pet.) (mem. op.) (concluding

that addendum and independent contractor agreement were not intended to function separately,

despite merger clauses in both documents, where they related to same subject, had same purpose

of setting forth the terms of the plaintiff’s employment, were executed by same parties, and

addendum contained references to the independent contractor agreement). Because Ashleigh was

a party to the Sales Contract, we conclude that she can be considered a party to the Warranty

Application as well.15

D. What is the effect of Ashleigh’s failure to sign the Warranty Application?

As a preliminary matter, we note that the Centricity Warranty itself did not call for any

signatures, and instead only required as a condition of its existence that Centricity approve the

Emmetts’ application and send the Warranty documents to the Emmetts, giving them the right to

cancel the warranty within 30 days of receipt. Therefore, the only question is whether Ashleigh

can be bound by the terms of the Centricity Warranty despite her failure to sign the Warranty

Application.

In answering this question, we recognize the general principle that a contract can still be

effective if signed by only one party. See, e.g., DeClaire v. G & B McIntosh Family Ltd. P’ship,

260 S.W.3d 34, 44 (Tex. App.—Houston [1st Dist.] 2008, no pet.) (citing Velasquez v. Schuehle,

562 S.W.2d 1, 3 (Tex. App.—San Antonio 1977, no writ). Thus, while a party’s signature is “strong

evidence” that the party unconditionally assented to the terms of a contract, in the absence of a

part of a unified instrument. The salient question is whether the Warranty Application—which was given to the
Emmetts at closing and had no independent existence outside the context of the sale itself—must be considered part
of the same unified instrument as the Sales Contract, which could bind both Emmetts to the Warranty in the absence
of a timely disclaimer.
15
We do not base this conclusion on any notion that spouses automatically bind each other as agents. Instead, our
holding is based on the fact that Ashleigh is undisputedly a party to the Sales Contract, and because we view the
Warranty Application as being part and parcel of the Sales Contract, she can be considered a party to the Warranty
Application as well.

33
signature, a court may look to other evidence to establish the party’s assent to an agreement. In re

Bunzl USA, Inc., 155 S.W.3d 202, 209 (Tex. App.—El Paso 2004, orig. proceeding). In particular,

the Texas Supreme Court has recognized that the Federal Arbitration Act—which the parties agree

governs the Centricity Warranty—does not require that an arbitration agreement be signed, so long

as the agreement is written and agreed to by the parties. In re AdvancePCS Health L.P., 172 S.W.3d

603, 606 (Tex. 2005) (orig. proceeding) (citing 9 U.S.C.A. § 3)); see also In re Citgo Petroleum

Corp., 248 S.W.3d 769, 774 (Tex. App.—Beaumont 2008, orig. proceeding) (recognizing same);

In re Bunzl, 155 S.W.3d at 210 (recognizing that Texas law is in accord with the FAA, which

requires an arbitration agreement to be written, but does not expressly require the agreement to be

signed by the parties) (citing Valero Ref., Inc. v. M/T Lauberhorn, 813 F.2d 60, 64 (5th Cir. 1987)

(recognizing that “a party may be bound by an agreement to arbitrate even in the absence of his

signature . . . [and][o]rdinary contract principles determine who is bound by a written arbitration

agreement”)).

As a matter of ordinary contract interpretation, if one party signs a contract and the other

does not, the other party may accept the contract by “his acts, conduct, or acquiescence in the terms

of the contract.” DeClaire, 260 S.W.3d at 44 (collecting cases). If the party’s acceptance is

demonstrated by its conduct, the contract becomes a “binding agreement on both parties.” Jones

v. Citibank (S. Dakota), N.A., 235 S.W.3d 333, 338 (Tex. App.—Fort Worth 2007, no pet.) (“Under

Texas law, if one party signs a contract, the other may accept by her acts, conduct, or acquiescence

to the terms of the contract, making it a binding agreement on both parties.”) (collecting cases);

see also Chubb Lloyds Ins. Co. of Texas v. Buster & Cogdell Builders, LLC, 668 S.W.3d 145, 151

(Tex. App.—Houston [1st Dist.] 2023, no pet.) (recognizing that when the parties demonstrate

their mutual assent to a contract, they are bound by its terms). Whether mutual assent exists is

34
usually a question of fact. Chubb Lloyds Ins. Co. of Texas, 668 S.W.3d at 151 (citing Foreca, S.A.,

v. GRD Dev. Co., 758 S.W.2d 744, 745–46 (Tex. 1988) (whether parties intended to execute

binding contract is often a question for the factfinder)). But in some instances, the existence of

mutual assent becomes a question of law. Id. at 151–152 (citing Foreca, S.A., 758 S.W.2d at 746).

Here, although neither BNI nor Ashleigh signed the Warranty Application or the Centricity

Warranty itself, the record reflects as a matter of law that their conduct demonstrated they both

assented to the terms of the Warranty. First, BNI demonstrated its assent by ensuring that the

Warranty Application was given to the Emmetts at closing and paying the requisite fee to have the

Warranty issued. In re Bunzl, 155 S.W.3d at 210–11 (recognizing that a party can demonstrate its

assent to an agreement by ensuring that the agreement’s obligations are enforced). As well, in his

affidavit, Jeffrey Mills averred that he had informed the Emmetts’ real estate agent that he was

furnishing a builders warranty on the property, as reflected in the email exchanges between the

various agents prior to the sale. The record also contains an email from Mary Mills to the closing

agent at the title company informing them of the need to present the Warranty Application to the

Emmetts at the closing. Accordingly, all of the evidence points to a conclusion that BNI

demonstrated its assent to the Warranty.

Ashleigh, however, contends she did not engage in any conduct demonstrating her assent

to the Warranty terms, and instead she “disavowed” or “disclaimed” it as soon as she learned of

its existence in September 2022.16 But this overlooks the actions her attorney took—or did not

take—in the interim on the Emmetts’ behalf with respect to their dispute with BNI.

As set forth above, the record reflects that the Emmetts retained Merica to represent them

in their dispute with BNI as early as January 2022, and that she began corresponding with the

16
According to her affidavit, Ashleigh did not see either the Warranty Application or the Warranty itself until the two
documents were attached to correspondence that her attorney received from Jeffrey Mills in September 2022.

35
Millses at that time, asserting she had the authority to act on their behalf. It is undisputed that on

February 7, 2022, Daniel and Ashleigh’s attorney asked Jeffrey Mills for a copy of the builders

warranty that her clients had been “promised” and that she received a copy of the Centricity

Warranty on February 9, 2022. Despite admittedly receiving the Warranty, neither Merica nor the

Emmetts disclaimed it for over six months, disregarding the Centricity Warranty’s clear notice that

the cancellation could be effected by “return[ing] the Warranty for cancellation within 30 days of

[their] receipt of it.” Even if we were to impute the latest admitted date Ashleigh received the

Warranty documents—February 2022—neither she, Daniel, nor their attorney made any attempt

to cancel or otherwise disavow the Warranty within the 30-day cancellation period.

Instead, after having received a copy of the Warranty documents in February 2022, and

with full knowledge of the Warranty’s terms binding the Emmetts to the express warranties set

forth in the policy, Merica, acting on behalf of both Emmetts, made continuing demands on BNI

to address the issues on the home, including the demand made in the May 2022 Notice she sent to

BNI detailing “items of defective construction that have become evident in the Emmett’s one year

warranty period” (emphasis added). As BNI points out, the Warranty carries a one-year warranty

period for defects in workmanship and materials, which comports with many of the items in

Merica’s May 2022 list of demanded repairs.17

At the hearing on BNI’s motion to compel, Merica asserted she was not referring to that

one-year warranty period in her May 2022 Notice, but instead to the “statute of limitations,”

contending Ashleigh’s claims have always been made under the “implied warranty of good and

workmanlike conduct” and all of them arose in the first year of her homeownership. However, as

17
The items included complaints about the pool gunite, a water leak at the front door, a dislodged sprinkler cover, a
broken stair rail, a waterfall that was not working in the hot tub, crumbling stepping stones on a walkway, a crack in
the walkway to the hot tub, broken tiles in the hot tub, a misaligned shower door, and a patio door that would not lock.

36
BNI points out, this argument carries little, if any weight, as a claim for the breach of the implied

warranty of workmanlike construction is subject to the same four-year statute of limitations that

governs claims for breach of contract, as an implied warranty only exists by virtue of the contract

from which it emanates. See Nghiem v. Sajib, 567 S.W.3d 718, 724–25 (Tex. 2019); see also

Beltway Park Baptist Church, Inc. v. Bolton, No. 11-18-00049-CV, 2020 WL 868069, at *2

(Tex. App.—Eastland Feb. 21, 2020, no pet.) (mem. op.) (recognizing that “[a] claim for breach

of the implied warranty of good and workmanlike manner, when not alleged as a violation of the

DTPA, may be subject to a four-year statute of limitation.

But regardless of whether Merica intended to refer to the Warranty in her May 2022 Notice,

the record contains other undisputed evidence that she assented to the Warranty on behalf of the

Emmetts prior to Ashleigh’s attempt to disclaim it months later. Merica continued to make

demands for repairs on the subject property that was covered by the Warranty’s express terms for

months before she wrote to Jeffrey Mills in September 2022 stating she believed Ashleigh was not

bound by the Warranty.18 According to Jeffrey Mills’s uncontroverted affidavit, Merica continued

to “request repairs and other minor work during the one-year warranty period, which BNI

continued to address” until that time. And Ashleigh did not provide any evidence in the record to

suggest that Merica did not have the authority to act on her behalf during that time, or that Merica

18
The dissent cites In re Weekley Homes, L.P., 180 S.W.3d 127, 133 (Tex. 2005) for “the proposition that
homeowners are not bound to arbitrate under an express warranty merely by seeking repairs.” According to the dissent,
“[t]he [Supreme] Court expressly rejected the notion that either requesting or receiving repairs covered by a warranty
sufficed to demonstrate assent.” The dissent further contends that Weekley required “more explicit affirmative conduct
tied to the warranty—claiming the authority of the contract and demanding compliance with the provisions of the
contract” in order to be bound by its terms. Id. at 133 (internal quotation marks omitted). But in Weekley, the issue
was whether the plaintiff was bound by an arbitration provision in a sales agreement she did not sign, and the court
held that she could not be bound merely because she resided in the home. Id. at 133. Nevertheless, the court held that
she could be bound because she engaged in certain actions under the “authority” of the sales agreement, such as
directing some of the construction features in the house, repeatedly demanding repairs to the home, and personally
requesting and receiving financial repairs. Id. However, the court did not make these factors a “requirement” in every
case, nor did it say that seeking repairs under an express warranty would not be sufficient to bind the homeowner to
the warranty.

37
took any actions outside the scope of her authority.19 See generally Breceda v. Whi, 187 S.W.3d

148, 152 (Tex. App.—El Paso 2006, no pet.) (recognizing that “[t]he attorney-client relationship

is one of agent and principal,” and therefore, “the acts of the former ordinarily binds the latter”)

(citing Texas Emp. Ins. v. Wermske, 349 S.W.2d 90, 93 (Tex. 1961); American Home Assur. Co. v.

Rodriguez, 749 S.W.2d 897, 899 (Tex. App.—San Antonio 1988, no writ)).

Finally, contrary to the dissent’s position, we do not suggest that an attorney has the

“implied authority to submit a case to arbitration” or that an attorney may do so without her client’s

consent. See, e.g., U.S. ex rel. Goldsby v. Harpole, 263 F.2d 71, 83 (5th Cir. 1959). Instead, our

holding is simply that, under these unique circumstances, Merica, who was hired to represent

Ashleigh in a warranty dispute, engaged in actions between February and September 2022 that

demonstrated Ashleigh’s assent agreement to be bound by the terms of the Warranty—which

included an arbitration agreement—well before she took any steps to disclaim it months later on

her clients’ behalf.

Accordingly, we conclude that Ashleigh assented to and was bound by the arbitration

agreement in the Centricity Warranty. BNI’s Issue One is sustained.20

19
The dissent cites Chavez v. Kansas City S. Ry. Co., 520 S.W.3d 898, 900–01 (Tex. 2017) for the proposition that
“just because a party hires an attorney to make demands does not indicate authority to compromise her substantial
rights.” We agree that there are limits to an attorney’s authority depending on the facts of the case. In Chavez, the
court held that there was a presumption that an attorney possessed the authority to act on her client’s behalf in entering
into a settlement agreement, but that the “presumption may be rebutted with evidence to the contrary” Id. at 900. Here,
the record undisputedly demonstrates that Merica was hired to represent the Emmetts with respect to their dispute
with BNI, and there is nothing in the record to suggest that she did not have the authority to take any of the actions
that she did. Nor does the record reflect that Ashleigh sought a hearing on this issue in the trial court.
20
In light of our resolution of Issue One, we need not address BNI’s other three issues in which it asserts other grounds
for concluding that Ashleigh is bound to the arbitration agreement in the Warranty as a nonsignatory.

38
VI. WHETHER ASHLEIGH’S CLAIMS ARE WITHIN
THE SCOPE OF THE ARBITRATION

BNI next addresses the argument Ashleigh made in the trial court that her claims were not

subject to arbitration as a basis for denying BNI’s motion to compel arbitration. Upon addressing

this question, we conclude that the trial court could not have denied the motion on this basis, as

the arbitration agreement called for the arbitrator, not the court, to decide the issue of arbitrability.

A. Applicable law

As explained above, a party seeking to compel arbitration of the opposing party’s claims

must establish not only that there is a valid and binding arbitration agreement, but that the claims

raised fall “within the scope of the agreement.” Sotero, 642 S.W.3d at 585–86. However, it is well-

established that the parties to a contract can agree that the arbitrators, rather than the courts, must

resolve disputes over the validity and scope of their arbitration agreements, i.e., they may delegate

authority to resolve arbitrability disputes to the arbitrator. TotalEnergies E&P USA, Inc. v. MP

Gulf of Mexico, LLC, 667 S.W.3d 694, 702 (Tex. 2023) (citing Jody James Farms, 547 S.W.3d at

631).

“If the parties have contractually agreed to delegate arbitrability disputes to the arbitrator,

courts must enforce that agreement just as they must enforce an agreement to delegate resolution

of the underlying merits to the arbitrator.” Id. (citing RSL Funding, 569 S.W.3d at 120). “For the

most part, the determination of whether parties have agreed to delegate arbitrability to an arbitrator

is governed by ‘ordinary state-law principles that govern the formation of contracts.’” Id. But a

court will only enforce an agreement to delegate arbitrability to the arbitrator if that agreement is

“clear and unmistakable.” Id. (citing Robinson, 590 S.W.3d at 525, 532).

39
B. Analysis

In its brief, BNI maintains that the Warranty clearly and unmistakably delegated

arbitrability to the arbitrator. It notes the Warranty’s provision that if the parties cannot resolve a

dispute through the informal dispute resolution processes, they agree that any dispute—including

“any dispute over the scope of this Arbitration Provision”—will be submitted to binding

arbitration. Ashleigh does not disagree. Instead, she contends (1) BNI waived its right to argue in

favor of such a delegation by arguing the issue of scope in the trial court, and (2) even though all

of her other claims come within the scope of the arbitration agreement, she nevertheless has a right

to have the trial court resolve her request for a declaratory judgment.

(1) Whether BNI waived its right to contend that the parties delegated
arbitrability issues to the arbitrator

Ashleigh contends BNI waived its right to maintain that the arbitration agreement

delegated arbitrability to the arbitrator, as BNI did not make this same argument in the trial court,

and instead affirmatively argued Ashleigh’s claims did come within the arbitration agreement’s

scope. According to Ashleigh, because BNI “argued the scope issue to the district court and asked

that court to rule upon it. . . . BNI clearly demonstrated its intent to abandon or waive any right it

had to have an arbitrator decide any dispute over the scope of the arbitration provision.”

In making this argument, Ashleigh relies solely on the Texas Supreme Court’s holding in

LaLonde v. Gosnell, 593 S.W.3d 212, 219 n.19 (Tex. 2019). We find this case unhelpful to her

position. In LaLonde, the plaintiffs sued a licensed professional engineer and his engineering

companies and consulting groups for breach of contract and negligence in addressing foundational

issues with their home without complying with the statutory requirement “to contemporaneously

file an affidavit from a similarly licensed professional attesting to the lawsuit’s merits[.]” LaLonde,

593 S.W.3d at 216. Although the failure to file such an affidavit required dismissal of the lawsuit,

40
the engineers did not seek dismissal of the lawsuit on that basis until the eve of trial, over a

thousand days after the lawsuit was filed and after both parties had engaged in substantial

discovery and pretrial proceedings. Id. In response, the plaintiffs maintained that the engineers had

waived their right to argue for dismissal on this basis, given their conduct in engaging in the

judicial process. Id. In agreeing with the plaintiffs, the Texas Supreme Court observed “[w]aiver

is the ‘intentional relinquishment of a known right or intentional conduct inconsistent with

claiming that right,’” and to demonstrate an “implied waiver by litigation conduct,” the party’s

conduct, whether through “action or inaction,” must “clearly demonstrate[] the party’s intent to

relinquish, abandon, or waive the right at issue—whether the right originates in a contract, statute,

or the constitution.”21 Id. at 218–220. After applying a totality of the circumstances test, the court

concluded that “the defendant engineers’ engagement of the judicial process implies they intended

to waive the statute’s requirements.” Id. at 216, 227–228 (citing Perry Homes v. Cull, 258 S.W.3d

580, 596 (Tex. 2008) (concluding plaintiffs waived their right to compel arbitration by their

conduct where they actively opposed arbitration, conducted extensive discovery, and waited until

the eve of trial, 14 months after filing suit). The court recognized that due to the defendants’ failure

to assert their right to dismissal until after the statute of limitations had expired on the plaintiffs’

contract claims, the defendants had been “sitting on their rights” and their delay in filing their

motion clearly prejudiced the plaintiffs. Id. at 229.

Here, however, BNI did not substantially invoke the judicial process prior to asserting its

right to seek arbitration of Ashleigh’s claims. To the contrary, as BNI points out, it quickly moved

to compel arbitration after filing its answer to Ashleigh’s petition (which also raised the affirmative

defense that her claims were subject to arbitration) without engaging in any other pretrial

21
The court noted that, in contrast, the question of whether a party is estopped from raising a right based on his
conduct “focuses on detriment or prejudice to the other party.” LaLonde v. Gosnell, 593 S.W.3d 212, 219 (Tex. 2019).

41
proceedings. Moreover, although BNI did not expressly argue in the trial court that arbitrability

was to be decided by the arbitrator, we cannot say that it waived its right to address this issue on

appeal by its conduct in the trial court. In the trial court, neither party addressed the question of

which entity—the arbitrator or the court—was to decide arbitrability. BNI did not argue that the

arbitrator was precluded from determining arbitrability. Instead, in the trial court, BNI’s sole focus

was to establish its right to compel arbitration of Ashleigh’s claims, and BNI never wavered from

its ultimate goal of establishing that Ashleigh’s claims were subject to arbitration. See Eagle Oil

& Gas Co. v. TRO-X, L.P., 619 S.W.3d 699, 709 (Tex. 2021) (where party did not make

unequivocal statements relinquishing its rights to receive equitable title of property and where

party’s actions were at all times “consistent with ‘its ultimate goal’ of being made whole,” court

would not find that party intentionally waived the right to make that argument on appeal).

Moreover, on appeal, the ultimate issue before us is whether the trial court erred in denying

BNI’s motion to compel arbitration, i.e., whether the arbitration agreement was valid and

enforceable against Ashleigh, and whether Ashleigh’s claims were subject to the agreement, both

of which we decide as a matter of law. In re Labatt Food Serv., L.P., 279 S.W.3d at 643. Although

BNI may be bringing a “new argument” regarding why the trial court erred in denying its motion

to compel arbitration, the issue remains the same, and we will therefore consider the argument in

our analysis. See Office of Risk Mgmt. v. Martinez, 539 S.W.3d 266, 273 (Tex. 2017) (recognizing

that “parties are free to construct new arguments” on appeal in support of “unwaived issues

properly before the court”).

We have already concluded that the arbitration agreement was valid and enforceable

against Ashleigh, and we acknowledge that the arbitration agreement expressly delegates

arbitrability to the arbitrator. We therefore conclude that the trial court could not have denied BNI’s

42
motion to compel arbitration based on a finding that Ashleigh’s claims do not come within the

scope of the agreement, as that issue was for the arbitrator to decide. Accordingly, we refrain from

opining on whether Ashleigh’s claims are in fact arbitrable, leaving it to the arbitrator to make that

determination. See TotalEnergies, 667 S.W.3d at 721 (having found that the parties delegated

arbitrability disputes to the arbitrator, the court would not express any opinion on the merits of the

parties’ controversy or on whether the arbitrator or the courts must resolve them).

(2) Ashleigh’s request that we remand her declaratory judgment claim
to the trial court

Finally, Ashleigh argues that regardless of whether the arbitration agreement delegated

arbitrability to the arbitrator, we should conclude that her request for declaratory judgment does

not fall within that delegation. Instead, she posits that the request must be resolved by the trial

court in the first instance. According to Ashleigh, we should treat her request for a declaratory

judgment as raising the gateway issue of whether “the Centricity [W]arranty binds [her] at all.”

She relies on the Texas Supreme Court’s holding in Sotero for the proposition that, “as a matter of

law,” this issue is “a question for the courts,” rather than the arbitrator. Ashleigh therefore requests

that if we reverse the trial court’s decision denying BNI’s motion to compel arbitration, we remand

to the trial court to allow it to resolve this issue in the first instance. We find no basis for doing so.

In Sotero, the court held that in resolving a motion to compel an arbitration agreement in a

contract, the question of whether a valid contract ever came into existence is a question of law for

the court to resolve. Sotero, 642 S.W.3d at 586. And we have already resolved that question. We

have also resolved the question of whether Ashleigh can be bound to the arbitration agreement,

despite her status as a nonsignatory to the contract, as a question of law for the court to decide. See

Transcor Astra Group S.A. v. Petrobras Am. Inc., 650 S.W.3d 462, 480 (Tex. 2022) (recognizing

that the question of “whether the parties made a valid and presently enforceable agreement to

43
arbitrate . . . is for the courts to decide”) (emphasis in the original) (internal quotation marks

omitted).

But Ashleigh’s request for a declaratory judgment goes beyond requesting a ruling on those

two issues, seeking a broad declaration that she did not “waive any implied warranties” with

respect to the construction and that “she is not subject to the limitations of the Centricity

Warranty.” In effect, her request seeks a ruling that she is not bound by the terms of the Warranty

and that she may pursue her common law claims in a court of law. The question of whether she

waived her right to bring those claims is inherently one of scope—a question that we have

determined is for the arbitrator to decide.

“[A]rbitrability turns on the substance of a claim, not artful pleading.” See In re Merrill

Lynch Tr. Co. FSB, 235 S.W.3d 185, 190 (Tex. 2007) (orig. proceeding). Therefore, “parties to an

arbitration agreement may not evade arbitration through artful pleading . . . .” Id. at 188, 190

(holding that where the plaintiffs’ claims against a Merrill Lynch employee were, in substance,

claims against Merrill Lynch, they were required to arbitrate in accordance with the contract with

Merrill Lynch; they could not rely on “artful pleading” to avoid arbitration). In particular, a party

may not bring a claim under the Uniform Declaratory Judgment Act as a means of avoiding

arbitration. See Craddick Partners, Ltd. v. EnerSciences Holdings, LLC, No. 11-15-00014-CV,

2016 WL 3920024, at *2 (Tex. App.—Eastland July 14, 2016, no pet.) (mem. op.) (concluding

that the plaintiff’s request for a declaratory judgment declaring that a sales agreement between the

parties had terminated was “an artfully pleaded breach of contract claim” subject to the parties’

arbitration agreement).

Here, Ashleigh attempts to avoid submitting her common law claims to arbitration by

seeking a judicial determination that she did not waive those claims and that she may bring them

44
in a judicial proceeding. That very request asks the trial court to resolve one of the most

fundamental disputes: whether her claims are subject to arbitration. Having found that the

arbitrator must decide arbitrability, we find no basis for treating her claim for declaratory relief

any differently than her other common law claims in this regard. We therefore reject Ashleigh’s

request to remand for the trial court to consider her claim for declaratory relief separately.

VII. WHETHER ASHLEIGH IS ENTITLED TO REMAND
FOR AN EVIDENTIARY HEARING

In her brief, Ashleigh contends for the first time that unresolved factual disputes require an

evidentiary hearing, and she asks that we remand to the trial court for that purpose. According to

Ashleigh, she was entitled to an evidentiary hearing on the question of whether a valid contract

was formed and whether she was bound by the arbitration agreement in the Warranty.

Aside from the fact that Ashleigh never requested such a hearing in the trial court, we find

no basis for granting her request at this time. Evidentiary hearings are rarely required to resolve a

motion to compel arbitration. Jack B. Anglin Co, 842 S.W.2d at 269. The legislature has “mandated

that a motion to compel arbitration be decided summarily,” as “the main benefits of arbitration lie

in expedited and less expensive disposition of a dispute[.]” Id. Therefore, a “trial court may

summarily decide whether to compel arbitration on the basis of affidavits, pleadings, discovery,

and stipulations.” Id. However, “if the material facts necessary to determine the issue [of whether

to compel arbitration] are controverted, by an opposing affidavit or otherwise admissible evidence,

the trial court must conduct an evidentiary hearing to determine the disputed material facts.” Id.;

see also In re Poly-Am., L.P., 262 S.W.3d 337, 354 (Tex. 2008) (orig. proceeding) (recognizing

same).

Ashleigh has not pointed to any disputed material facts in the parties’ opposing affidavits

preventing us from determining whether a valid contract was formed or whether she was bound to

45
the arbitration agreement despite being a nonsignatory. To the contrary, we have resolved both

issues as a matter of law based on the undisputed evidence that (1) Ashleigh’s husband signed the

Warranty application at closing; (2) Centricity issued the Warranty in May 2021; (3) the Emmetts

received the Warranty in February 2022, if not June 2021, and made no attempt to cancel it within

the 30-day cancellation period; and (4) the Emmetts sought benefits under the Warranty by

continuing to make demands for home repairs for the next several months without attempting to

disavow the Warranty until September 2022. Ashleigh has not explained where the dispute lies

that would have prohibited us from resolving these two issues on the evidence before us. We

therefore deny Ashleigh’s request to remand to the trial court for an evidentiary hearing. See In re

Poly-Am., L.P., 262 S.W.3d at 354 (rejecting plaintiff’s request for an evidentiary hearing on the

defendant’s motion to compel arbitration where the parties’ affidavits were not in conflict on any

issue relevant to the motion).

VIII. CONCLUSION
We reverse the trial court’s order denying the motion to compel arbitration and remand to

the trial court with directions to submit Ashleigh’s claims to arbitration in accordance with the

arbitration provisions in the Warranty.

LISA J. SOTO, Justice

August 29, 2025

Before Salas Mendoza, C.J., Palafox and Soto, JJ.
Palafox, J., dissenting

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