347 S.W.3d 855
Tex. App.2011Background
- Allegiance Hillsview owns surface rights to two Denton tract(s); Rayzor owns mineral interests; Range Texas Productions is Rayzor's lessee under a Surface Use Agreement (SUA) amended to extend a Development Deadline of July 11, 2009.
- SUA allowed a deadline extension for force majeure events, including City of Denton permit delays, if permit applications were timely filed and prosecuted.
- Range filed a gas-well permit, SUP, etc., and requested extensions; public notices and City processes affected timing.
- A City notice error regarding zoning classification delayed the SUP hearing, pushing consideration beyond the July 11 deadline; Range later sought a declaration of force majeure.
- The trial court found a force majeure event occurred, extended Range’s deadline, and awarded Range attorney’s fees; Allegiance appealed, challenging notices, existence of force majeure, and timeliness of permit filings.
- The appellate court affirmed, upholding the force majeure finding, notice sufficiency, and timeliness of permit filings, and denying relief on Allegiance’s other challenges.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Range gave timely and sufficient notice of force majeure | Allegiance contends notice was deficient | Range reasonably complied with five-business-day notice and explained the City notification error | Yes; notice was timely and sufficient |
| Whether an event of force majeure occurred beyond Range’s control | No qualifying force majeure event occurred | City’s failure to issue permits qualified as force majeure per SUA | Yes; City failure to issue permits, aided by notification error, constitutes force majeure |
| Whether Range timely submitted permit applications | Timeliness was not met given the deadline | Range filed permit applications within a reasonable time under the circumstances | Yes; timely filing within reasonable time under the circumstances |
| Whether the injunction and attorneys’ fees were proper given the force majeure finding | If no force majeure, relief would be improper | Based on force majeure, injunction and fees appropriate | Affirmed; injunction and fees upheld |
Key Cases Cited
- Sun Operating Ltd. P'ship v. Holt, 984 S.W.2d 277 (Tex. App.-Amarillo 1998) (contract interpretation of force majeure not rewritten by courts)
- Centre Ready Mix Concrete Co. v. Islas, 228 S.W.3d 649 (Tex. 2007) (reasonable time implied for performance contracts)
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (standards for legally/factually sufficient evidence; great deference to fact finder)
- CherCo Props., Inc. v. Law, Snakard & Gambill, P.C., 985 S.W.2d 262 (Tex. App.-Fort Worth 1999) (when no time for performance is stated, a reasonable time is implied)
- Pool v. Ford Motor Co., 715 S.W.2d 629 (Tex. 1986) (standard for reviewing factual sufficiency on a trial-to-the-court judgment)