On February 28, 2025, the Fifth District Court of Appeals handed down an opinion in Case No. 05-24-000147-CV, Main Street Food Hall LLC and Curtis Croft v. CDM Builds, Inc., affirming the trial court’s judgment in declining to vacate an arbitration award. The Opinion is relatively short but reinforces the importance of procedural matters that are sometimes overlooked in arbitration.
An arbitrator ruled in favor of CDM Builds, ordering Main Street Food Hall LLC (“MSFH”) and Curtis Croft (“Croft”) to pay CDM Builds $340,399.50, jointly and severally. The arbitration proceeded before the American Arbitration Association.
CDM Builds filed an application to confirm the arbitration award and enter a final judgment. MSFH and Croft sought to vacate the award and set the matter for a new trial and filed several items with the trial court that they contend were evidence to support their position that the award be vacated. On appeal, MSFH and Croft, without citation to the appellate record, alleged that the trial court errored in ruling on the issue of waiver alone and disregarded statutory grounds required to be considered prior to confirming the arbitration award.
First, the Court of Appeals reinforced sweeping precedent with respect to the effect of an arbitration award. “An arbitration award has the same effect as a judgment of a court of last resort, is presumed valid, and is entitled to great deference.” The Court reiterated that its “review is so limited that we may not vacate an award even if it is based upon a mistake in law or fact… Judicial scrutiny of an award focuses on the integrity of the arbitration process, not the propriety of the result.”
The Court went on to hold that the non-prevailing party seeking to vacate an arbitration award, “bears the burden in the trial court of bringing forth a complete record that establishes its basis for vacating the award.” The next part highlights the pitfall some practitioners find themselves in after an unfavorable arbitration hearing. “Where there is no transcript of the arbitration hearing, the appellate court will presume the evidence was adequate to support the award.” The Court of Appeals held that since MSFH and Croft, “failed to provide the trail court with a transcript of the arbitration proceeding, we are unable to determine the basis of the arbitrator’s award and must presume the arbitrator’s award was supported by evidence.”
Thus, if during the arbitration proceeding the arbitrator did engage in misconduct, violated due process, or showed corruption, all grounds for vacating an arbitration award, it would not matter since the parties did not get a court reporter/stenographer to transcribe the hearing. The various arbitration forums will have their rules on what is required to transcribe hearings. However, this case underscores the deference given to the arbitrator and the arbitration award if a party fails to provide a transcript. You can read the full opinion at:
###
Christopher Chapaneri a distinguished Lydecker attorney with extensive expertise in civil litigation, construction defect, premises liability, amusement park litigation, commercial motor vehicle/trucking, employment law, and environmental litigation—including mold exposure and vegetation management/overspray matters. Chapaneri also has a robust appellate practice, having successfully handled cases before the Texas Supreme Court and the Fifth Circuit Court of Appeals.
In addition, Chapaneri brings substantial experience in handling high exposure and high-risk cases, further strengthening Lydecker’s ability to serve clients across multiple industries in Texas and beyond. Chapaneri also provides services in the State of Oklahoma.
