Beaumont's Ninth Court of Appeals has refused to void a $460,000 legal malpractice arbitration award against a Houston law firm and two attorneys after they alleged the arbitrator failed to follow Texas law.

According to the decision in Midani v. Smith, Elizabeth Smith retained Houston's Midani Hinkle & Cole to represent her in a dental malpractice case after she suffered permanent nerve damage because of dental surgery.

In her written agreement with the law firm, Smith agreed that any dispute she had with the attorneys would be settled in binding arbitration based on evidence submitted and governed by the Texas Rules of Civil Procedure.

David Hutchins and Mark Midani were both working at Midani Hinkle when they filed a medical malpractice claim on her behalf against the dentist in March 2013. Hutchins left the firm three months later but continued working on the case. Two years later, Hutchins informed Smith that the trial court had dismissed her case for no apparent reason and there was nothing more he could do for her, the court said.

After retaining new counsel, Smith learned that her case had been dismissed after no attorneys from Midani Hinkle appeared at her trial setting. She later sued Hutchins, Midani and Midani Hinkle in a Jefferson County state district court, alleging negligence, gross negligence and violation of the Texas Deceptive Trade Practice Act.

Midani and Midani Hinkle moved to compel arbitration, which the trial court granted. The arbitrator later ruled in Smith's favor, also finding that after Hutchins left Midani Hinkle, he continued to work as the firm's agent, and that Midani Hinkle and Midani were vicariously liable for Hutchins' negligence.

The arbitrator awarded Smith $250,000 in noneconomic damages for negligence: $100,000 in actual damages for loss of household services, $8,899.86 for past and future medical costs against all the defendants, and $100,000 in exemplary damages for gross negligence against Hutchins. But he didn't find that Midani Hinkle was vicariously liable for Hutchins' gross negligence.

The arbitrator also concluded that Midani was 75 percent responsible for Smith's damages, while the firm was 5 percent responsible, and Hutchins was 20 percent responsible.

Smith moved to enter final judgment on the arbitration award, but Midani and Midani Hinkle filed a motion to vacate the award, alleging that the arbitrator failed to follow Texas law. Midani and the firm also argued that the arbitrator should not have held them liable for the acts of Hutchins and should not have apportioned responsibility.

The trial court later entered a final judgment approving the arbitration award, dismissing Midani and the firm's motion to vacate the award, decisions Midani and the firm both appealed to the Ninth Court.

In making its decision, the Ninth Court noted that binding arbitration has the same effect under Texas law as a judgment of a court of last resort, and an arbitrator's decision is presumed to be valid and entitled to great deference.

“Judicial review of an arbitration award is so limited that even a mistake of law or fact by the arbitrator in applying substantive law is not a proper ground for vacating an award,” wrote Chief Justice Steve McKeithen.

McKeithen also concluded that Smith's legal malpractice claims fell within the scope of the arbitration provision, and the arbitrator decided the matters that the parties intended to arbitrate.

“Because the appellants have failed to establish any grounds for vacating or modifying the arbitrator's award, we conclude that the trial court did not err in confirming the arbitration award,” McKeithen wrote.

However, the Ninth Court's decision reversed a ruling by the trial court holding the defendants in contempt for failure to answer postjudgment discovery after the defendants eventually paid for a supersedeas bond.

Lance Kassab, a Houston attorney who represents Smith, was pleased with the decision.

“The appeal was completely frivolous,” Kassab said. “They were the ones that compelled arbitration—we fought it. And when the award came down, they wanted to appeal it.”

“You can almost never appeal an arbitration award unless you can show some fraud by the arbitrator, which is almost impossible,” Kassab added. “That's why we were surprised they tried to appeal the arbitration.''

Russell Heald, a partner in the Beaumont office of Wilson Elser Moskowitz Edelman & Dicker who represents Midani and the firm, did not return a call for comment. Midani also did not return a call for comment.

Hutchins, who represented himself pro se in the case and did not participate in the appeal, did not return a call for comment.