Republic Petroleum LLC and Republic Petroleum Partners, LP v. Dynamic Offshore Resources NS LLC and W&T Offshore Inc.
01-14-00370-CV
| Tex. App. | Apr 13, 2015Background
- Republic Petroleum LLC (Republic LLC) brought suit seeking damages related to production under the High Island 115 (HI‑115) well; damages alleged to begin July 3, 2008. Republic LLC later assigned its working interest in HI‑115 to Republic LP (effective May 11, 2007 and/or Oct. 15, 2008), and defendants assert Republic LLC had no working interest at the time of suit.
- The HI‑115 Operating & Allocation Agreement (OOA) sets expense/revenue allocation by working interest and names the operator; an OOA amendment effective July 16, 2010 lists Rooster Petroleum as operator (showing Republic LLC was not operator when suit was filed).
- Defendants filed verified denials (Tex. R. Civ. P. 93) disputing Republic LLC’s capacity/standing to sue and recover. Republic LLC attempted to introduce testimony (bill of exception) that was excluded; district court ruled Republic LLC did not sue in any representative or operator capacity.
- At trial Republic LLC pursued 100% of the damages though its ownership share was contested; defendants argue any recovery should be limited to Republic LLC’s working‑interest share (they calculate $32,971.73 through Oct. 15, 2008).
- Defendants moved for directed verdict/JNOV and to modify judgment; they appealed the denial of JNOV and the Modified Final Judgment awarding Republic LLC full recovery, arguing lack of standing/capacity and other preservation issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing / capacity to sue | Republic LLC claims privity under the PHA/OOA and that the OOA authorized prosecution of claims (or that it had capacity). | Defendants: privity ≠ standing; Republic LLC had no working interest when suit was filed and was not operator — so it lacked a distinct injury and capacity to recover. | Court treated standing/capacity as legal issues; defendants argue dismissal or take‑nothing should be rendered because Republic LLC lacked ownership/standing. |
| Operator status under OOA | Republic LLC contends OOA provisions permit Republic to prosecute claims or otherwise entitle it to recover. | Defendants: the OOA shows Rooster was operator when suit filed; Republic LLC was not operator and district court excluded testimony claiming representative capacity. | District court ruled Republic LLC did not sue as operator/representative; admission attempts were excluded. |
| Sufficiency of verified denials (Rule 93) | Republic LLC contends defendants’ verifications lacked bases of personal knowledge and were defective. | Defendants: verifications properly recited personal knowledge and referenced answers; unsworn declarations would suffice; failure to object at trial waived any form complaint. | Defendants’ verifications held sufficient and any defect that was a form objection was waived for lack of timely district‑court objection. |
| Relevance of working‑interest allocation to damages | Republic LLC argues the dispute concerns breach of the PHA and not ownership percentages, so working interest is irrelevant. | Defendants: damages and PHA allocations are tied to working interest; without an ownership interest (or suing in representative capacity) Republic LLC cannot recover more than its share. | Precedent and the OOA allocate costs/revenue by working interest; ownership is relevant and determinative for standing/damages. |
| Waiver / jury charge preservation | Republic LLC suggests defendants waived challenge by not requesting a charge revision on working‑interest damages. | Defendants: standing is jurisdictional and not waivable; they filed verified denials, objected to questions, filed directed verdict/JNOV/new trial/motion to modify — so error preserved. | Court treated standing/capacity as legal issues not for jury; defendants’ preservation (objections, post‑trial motions) supported appellate review. |
Key Cases Cited
- Austin Nursing Ctr., Inc. v. Lovato, 171 S.W.3d 845 (Tex. 2005) (standing is a jurisdictional component and not waivable)
- Texas Workers’ Compensation Comm’n v. Garcia, 893 S.W.2d 504 (Tex. 1995) (standing limits subject‑matter jurisdiction)
- Interstate Contracting Corp. v. City of Dallas, 135 S.W.3d 605 (Tex. 2004) (privity does not automatically supply standing; context for pass‑through claims)
- Nauslar v. Coors Brewing Co., 170 S.W.3d 242 (Tex. App. — Dallas 2005) (party that sold entire interest cannot personally recover on claims belonging to the business entity)
- Shipley v. Unifund CCR Partners, 331 S.W.3d 27 (Tex. App. — Waco 2010) (assignee lacking title/ownership has no standing to sue on assigned account)
- T.O. Stanley Boot Co. v. Bank of El Paso, 847 S.W.2d 218 (Tex. 1992) (uncontroverted fact that negates plaintiff’s case need not be submitted to jury)