The Texas Supreme Court handed down an opinion on January 27, 2023 in Taylor Morrison of Texas, Inc. v. Skufca. A trial court denied a motion to compel arbitration that involved breach of contract claims brought by Jack and Erin Skufca, along with their minor children alleging construction defects with their new home. The Court of Appeals upheld the denial. In reversing, the Texas Supreme Court held "that the Skufcas' petition, which did not distinguish between the parents' claims and the children's claims, unambiguously reflects the children as joining their parents in asserting the breach-of-contract claim and that the children therefore may be compelled to arbitrate."
The Texas Supreme Court went further: “We note, however, that our decision does not mean that the children may avoid arbitration simply by amending the petition to allege only tort or other noncontractual claims… Because the Skufca children lived with their parents in the home and sued for factually intertwined construction-defect claims, that basis for direct benefits estoppel serves as an additional reason to compel arbitration here.” The full opinion is linked here.
Given the prevalence of arbitration agreements in amusement, water, and adventure park admissions, it is arguable that the same grounds for direct benefits estoppel may apply to minors entering these parks as an additional basis for compelling arbitration. However, it remains to be seen how far the Court will apply the ruling outside construction defect claims.
