Trial Court Must Hear Challenge to "Islamic Pre-Nuptial Agreement" Before Referring Matter to Arbitration

Though the agreement provided for arbitration, under Texas family law challenges to the validity of a family law arbitration agreement can't wait until after the arbitration takes place.

From In re Ayad, decided Friday by the Texas Supreme Court:

Relator Salma Mariam Ayad married real party in interest Ayad Hashim Latif in 2008. In connection with their marriage, they signed … [an] "Islamic Pre-Nuptial Agreement" …. In the Agreement, the parties recite their "belief that Islam … is binding on [them] in all spheres of life." As relevant here, the Agreement provides that "[a]ny conflict which may arise between the husband and the wife will be resolved according to the Qur'an, Sunnah, and Islamic Law in a Muslim court, or in [its] absence by a Fiqh Panel."

The Agreement then explains how the members of the three-person panel will be selected and provides that the panel "will not represent the parties in conflict, but rather, serve as impartial arbitrators and judges, guided by Islamic Law and [its] principles." According to the Agreement, "the majority decision of the Fiqh Panel will be binding and final."

Although Ayad's signature appears on the Agreement, she alleges that she did not become aware of its contents—or even see it—until she and Latif began experiencing marital difficulties in 2020. This, Ayad asserts, is when she learned she had been "defrauded" into signing a premarital agreement that violates her fundamental rights. According to Ayad, she received the two documents in a stack with the Marriage Contract [which she acknowledges she did sign, and which isn't at issue here -EV] on top, and she thought the Agreement was another copy of the Marriage Contract.

In January 2021, Ayad sued for divorce and sought to be appointed joint managing conservator of the couple's six-year-old son. Latif filed his own counterpetition for divorce and moved to enforce the Agreement. Ayad raised multiple challenges to enforcement, including that: the term "Islamic Law" was too indefinite; the Agreement was void because it violated public policy; Latif's previous breaches of the Agreement had excused Ayad from performing; and the Agreement was unconscionable.

The trial court ordered that the case go to arbitration, and said that, "if an eventual arbitration award was based on foreign law, it would review the award under Texas Rule of Civil Procedure 308b 'to determine whether the award violates constitutional rights or public policy.' The court also noted that 'upon proper application of a party' under Section 153.0071 of the Family Code, it would hold a hearing to determine whether the arbitration award was not in the best interest of the parties' child."

Not proper, said the Texas Supreme Court (emphasis added):

Because we agree with Ayad that the trial court was statutorily required [by the Texas Family Code] to hear and determine her challenges to the Agreement's validity and enforceability before referring the parties' disputes to arbitration, we conditionally grant her petition for writ of mandamus. We do not reach the merits of her challenges to the validity and enforceability of the Agreement, which the trial court should try in the first instance….

To be sure, "Under the ordinary rule [for arbitration provisions in Texas], challenges to the validity or enforceability of the contract containing the agreement to arbitrate are decided by the arbitrator." But the "unique statutes" applicable to family arbitration "alter the ordinary rule."

In the trial court, Ayad raised multiple challenges to the validity and enforceability of the Agreement. During the hearing on Latif's motion to enforce, the trial court did receive testimony from Latif's expert witness regarding Ayad's contention that the Agreement's reference to Islamic law was ambiguous and thus unenforceable. And during the hearing on Ayad's motion to reconsider, the trial court gave each party twenty minutes to present arguments and evidence on the sole issue of voluntariness.

The trial court did not determine either issue in its order compelling arbitration, however, because it incorrectly concluded it was without discretion to do so. Nor is there any indication in the record that the court tried Ayad's additional challenges that the Agreement itself was void as against public policy and unconscionable. Instead, the court indicated that it would determine following arbitration whether the terms of any award made under the Agreement violate public policy….

[But] when a party to a divorce or child-custody proceeding has challenged the validity or enforceability of an agreement containing an arbitration provision, the trial court cannot order binding arbitration without first "try[ing]" the issues of validity or enforceability and "determin[ing]" that the agreement is valid and enforceable. Tex. Fam. Code §§ 6.6015(a), 153.00715(a). Because the trial court did not comply with Sections 6.6015 and 153.00715, it clearly abused its discretion….

The trial court will therefore need to decide whether, among other things, Ayad had indeed agreed to Islamic arbitration, and whether such arbitration is invalid under Texas law on the theory that applying Islamic law would "violate[] constitutional rights or public policy." Here are some of Ayad's arguments on this latter point; note that Latif's briefing didn't respond to them, because it argued that Texas courts can consider such matters only in reviewing the arbitration after it takes place, rather than beforehand. Now that the Texas Supreme Court disagreed as to the timing, Latif will have an opportunity to respond to these arguments on remand:

[1.] Violates the Establishment Clause.

The Establishment Clause requires separation of government determination from religious activities under the United States Constitution. U.S. Const. amend. I. The Islamic Prenuptial Agreement as a whole and the alleged arbitration agreement specifically require the application of Islamic Law in a Texas court with complete disregard for the laws of the United States and the State of Texas, thereby invoking the Establishment Clause. Shiva Falsafi, Religion, Women, and the Holy Grail of Legal Pluralism, 35 Cardozo L. Rev. 1881, 1926 (2014); Allison Gerli, Living Happily Ever After in a Land of Separate Church and State: Treatment of Islamic Marital Contracts, 26 J. Am. Acad. Matrim. Law 113, 119 (2013); Lindsey E. Blenkhorn, Islamic Marriage Contracts in American Courts: Interpreting Mahr Agreements as Prenuptials and their Effect on Muslim Women, 76 S. Cal. L. Rev. 189, 214-15 (2002). ("The question of whether the couple meant to waive community property and equitable distribution rules implicates the Establishment Clause because interpreting mahr agreements necessarily entails an analysis of Islamic religious doctrine.").

[2.] Violates Equal Protection to obtain a divorce.

The Islamic Prenuptial Agreement as a whole and the alleged arbitration agreement specifically violate Wife's right to Equal Protection under the United States Constitution and equality under the law in the Texas Constitution. U.S. Const. amend. XIV, §2; Tex. Const. art. I, § 3a. The application of Islamic Law limits the rights of a woman to obtain a divorce absent consent of the husband and applies the laws differently to women versus men. Falsafi at 1918, 1933. "The Quran gives married men a right to divorce their wives. Nothing in the Quran gives married women the same right. In the Islamic law on divorce, in keeping with the Quran's provision, the husband has a unilateral right to obtain a divorce." Barbara Massie, Examining the Foundations: Comparing Islamic Law and the Common Law of the United States, 11 Liberty U.L. Rev. 525, 553 (2016).

[3.] Violates Equal Protection to present evidence.

The Islamic Prenuptial Agreement as a whole and the alleged arbitration agreement specifically violate Wife's right to Equal Protection under the United States Constitution and the Texas Constitution. U.S. Const. amend. XIV, §2; Tex. Const. art. I, §3a. The application of Islamic Law means that the weight and credibility of the evidence provided by Wife will be automatically half of that of any male who testifies or provides evidence, including Husband. Thus, Wife will neither be meaningfully heard nor afforded a meaningful opportunity to present evidence material to the controversy.

In Islamic law, the rules concerning witness testimony discriminate between men and women. For example, a woman's testimony is worth half that of a man's, according to the following instructions from the Quran: 'And get two witnesses out of your own men, and if two men are not there then a man and two women … so that if one makes a mistake, the other can remind her.' Apparently, a man is presumed to be a competent witness, whereas a woman is not.

Massie at 554.

"Another issue emerges if the parties chose Islamic law as the applicable evidentiary law and adopted an interpretation that holds a woman's testimony to be equal to half of a man's testimony." Saad U. Rizwan, Foreseeable Issues and Hard Questions: The Implications of U.S. Courts Recognizing and Enforcing Foreign Arbitral Awards Applying Islamic Law Under the New York Convention, 98 Cornell L. Rev. 493, 499 (2013). "Furthermore, if the parties ask the arbitrator to apply Islamic law and the arbitrator interprets Islamic law as dictating that a woman's testimony equals half of a man's  testimony, then a U.S. court's recognition and enforcement of such an award might violate the Equal Protection Clause." Rizwan at 512.

[4.] Violates Due Process and Due Course of Law.

The Islamic Prenuptial Agreement violates Wife's right to Due Process under the United States Constitution and Due Course of Law under the Texas Constitution. U.S. Const. amend. XIV, §1; Tex. Const. art. I, §19. She will not have a meaningful right to be heard and present evidence material to the controversy and cross-examine any witnesses. See Massie at 554 (supra).

[5.] Violates Wife's right to obtain a divorce.

The Islamic Prenuptial Agreement violates Wife's right to obtain a divorce and dissolution of her marriage because Islamic Law limits the rights of a woman to seek divorce. Nathan B. Oman, How to Judge Shari'a Contracts: A Guide to Islamic Marriage Agreements in American Courts, 2011 Utah L. Rev. 287, 302 (2011). "The Quran gives married men a right to divorce their wives. Nothing in the Quran gives married women the same right. In the Islamic law on divorce, in keeping with the Quran's provision, the husband has a unilateral right to obtain a divorce." Massie at 553.

[6.] Violates right to determination of the child's best interests.

The Islamic Prenuptial Agreement violates the right to a determination of the child's best interests according to Texas Family Code §153.002 because Islamic Law does not consider the best interest of the child as the primary consideration in making determinations regarding conservatorship. Instead, Islamic Law determines conservatorship based on a heavily biased formula using the gender of the parent and the age of the child.

[7.] Violates Wife's right to a just and right division of the marital estate.

The Islamic Prenuptial Agreement violates Wife's right to a just and right division of the marital estate. Islamic Law makes no provision for a marital estate, community property, or separate property. Oman, How to Judge Shari'a Contracts: A Guide to Islamic Marriage Agreements in American Courts, supra at 306, 311; Nathan B. Oman, Bargaining in the Shadow of God's Law: Islamic Mahr Contracts and the Perils of Legal Specialization, 45 Wake Forest L. Rev. 579, 590 (2010). ("There is nothing in Islamic law analogous to community or marital property."); Blenkhorn at 226. ("The Shari'a—whereby the wife is not permitted to work without permission but then is not allowed to claim ownership in anything that she does not herself earn—is so repugnant to public policy that it outweighs any other choice-of-law concern.").

[8.] No financial disclosures.

The Islamic Prenuptial Agreement did not provide that Wife knowingly waived her rights under the Texas Constitution to a determination of the community property and separate property of the marital estate of the parties. No disclosure of assets and liabilities was made between the parties, and none was waived; thus, the agreement is invalid as a premarital agreement under the laws of the State of Texas. Tex. Fam. Code §4.003(a)(2); see Falsafi at 1917. ("…[T]here is neither a requirement for the 'fair and reasonable disclosure of the property' nor much sanction against what might be considered unconscionable behavior under statutory prenuptial regimes [in Islamic Law].")

Congratulations to Michelle May O'Neil, Michael D. Wysocki, Karri L. Bertrand, and M.K. Kassie Hines (O'Neil Wysocki, P.C.), who represent Ayad.