SAMSON EXPLORATION, LLC, Appellant v. T.S. Reed Properties, Inc., et al., Appellees
NO. 09-13-00366-CV
Court of Appeals of Texas, Beaumont
October 22, 2015
Submitted on May 29, 2014
HOLLIS HORTON, Justice
***
The University expects its students to obey the law. Therefore, a violation of alcohol or drug laws while admitted to the University, wherever that violation occurs, is a violation of the University‘s Student Conduct Code. Further, it is a violation of the University‘s expectations for a student to drink, possess, or be impaired by drinking, alcoholic beverages, or to possess, use, or be under the influence of, illegal drugs or non-prescription hallucinatory drugs, on campus or at any event sponsored by the University or by a University-approved student organization.
Further, under the student handbook, the university reserved the right to require students to submit to drug testing:
Designated University officials reserve the right to require a student to show proof of a drug-free condition including drug testing whenever such officials suspect or have reasons to believe that a student might be engaging in drug use on or off campus. Reasonable suspicion for testing is to be determined by the sole discretion of University officials.
“Possession of drug paraphernalia” was one of many listed, nonexclusive grounds for requiring drug testing. The university also reserved “the right to use canine detection services whenever drugs are suspected on University property and are undetected by other means, as well as a deterrent to drug possession or use among students.”
24. Whether a Howard Payne police officer could have conduct a physical search beyond what the student inspectors found, without a warrant, need not be decided here.
Once the student inspectors discovered what appeared to be illegal drugs and drug paraphernalia, the clause in the student handbook regarding violations of university regulations became operable, as well as the university prohibition against drug use and the university‘s avowed intent to cooperate with law enforcement. Howard Payne police officers, as employees of the university, were thus authorized to enter the room to seize the suspected drugs and drug paraphernalia found by the student inspectors.24
I respectfully dissent.
Paul F. Simpson, Christopher L. Halgren, McGinnis, Lochridge & Kilgore, LLP, Houston, TX, David M. Gunn, Erin H. Huber, Beck Redden LLP, Houston, TX, Patton G. Lochridge, Don H. Magee, J. Derrick Price, McGinnis, Lochridge & Kilgore, LLP, Austin, TX, Jon B. Burmeister, Moore Landrey, LLP, Beaumont, TX, for Appellees/Cross-Appellants.
Before McKeithen, C.J., Kreger, and Horton, JJ.
MEMORANDUM OPINION
HOLLIS HORTON, Justice
We issued our original memorandum opinion in this cause on August 27, 2015, and afterwards, the appellant and the appellees filed motions for rehearing. The court denies the motions for rehearing; however, the panel withdraws its opinion and judgment and issues this opinion and judgment in their stead.
In this oil and gas case, filed by several stakeholders with interests in two pooled gas units, we are asked to decide two principal issues. First, whether the stakeholders participating in one of the pooled units can recover damages from the operator of the unit when the operator amended the boundaries of the unit to exclude a well that was within the boundaries of the original unit, and where the stakeholders accepted royalties attributable to the amended unit without challenging the operator‘s authority to amend the original unit‘s boundaries. Second, whether the stakeholders in another unit, based on their claims for breach of contract, can recover
With respect to the stakeholders in the first unit, given their actions following the amendment to boundaries of the unit, we conclude they ratified the operator‘s amendment to the boundaries of the first unit. Based on their ratification of the amendment to the unit, we hold they are entitled to recover nothing on their claims. With respect to the stakeholders in the second unit at issue in the appeal, and given the operator‘s failure to file an amendment to the description defining the unit‘s boundaries to correct its alleged mistake, we hold the stakeholders in that unit can recover damages from the operator for its alleged breach of their leases. However, with respect to these stakeholders, we also conclude the trial court‘s awards are excessive, as the awards include royalties on production that occurred before the date their unit first existed.
Background
This case involves numerous plaintiffs,1 three gas wells, and two pooled units, the first of which the operator amended to change the unit‘s name and its boundaries. In the trial court, the following plaintiffs2 sued Samson Exploration, LLC3 based on their claims that they owned an interest in mineral leases that Samson pooled into the units at issue.
In late 2002, Samson successfully completed a third gas well that was perforated
In 2004, six of the stakeholders in the Joyce DuJay Unit sued Samson claiming that Samson had breached its duties under leases by refusing to allocate any of the gas produced by the Black-Stone-lease well for their accounts. Subsequently, additional plaintiffs, some of them stakeholders in the Joyce DuJay Unit and some of them stakeholders in the DuJay-A Unit, joined the suit.8 The DuJay-A Unit stakeholders claimed that Samson failed to comply with its contract obligations under the terms of their lease. All of the DuJay-A claimants based their claims on a lease between Samson and T.S. Reed Properties9 and the declaration Samson filed when it created the DuJay-A Unit.
Samson and the DuJay-A claimants timely filed appeals; both complain about various aspects of the trial court‘s final judgment.
Standard of Review
We review a trial court‘s ruling on a motion for summary judgment using a de novo standard of review. See Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003). With respect to the Joyce DuJay and DuJay-A claimants’ motions for summary judgment, they were required to demonstrate to the trial court that no genuine issue of material fact existed, and to show that they were entitled to judgment as a matter of law,
With respect to Samson‘s motion for summary judgment, it was required, as a defendant moving for summary judgment, to conclusively negate at least one essential element on each of the plaintiffs’ causes of action, or through its own summary judgment evidence, it was required to conclusively establish each of the elements on an affirmative defense that would create a bar to the plaintiffs’ recovery. See Sci. Spectrum, Inc. v. Martinez, 941 S.W.2d 910, 911 (Tex. 1997). To prevail on its traditional motion, Samson was required to demonstrate that no genuine issues of material fact existed that prevented the trial court from rendering judgment in its favor.
When both the plaintiffs and defendants in a case move for summary judgment, and the trial court grants one motion and denies the other, all of the summary judgment evidence before the trial court is reviewed in the appeal to determine the questions that are presented by the competing motions. Mann Frankfort, 289 S.W.3d at 848. When possible, in cases involving cross-motions for summary judgment, the appeals court is required to render the judgment the trial court should have rendered in the case. Id.
According to Samson, the Joyce DuJay claimants ratified the amendment of the Black Stone Unit by accepting royalties that were paid to the stakeholders of the Joyce DuJay Unit based on the acreage within the amended unit‘s boundaries. Samson contends that the Joyce DuJay claimants’ ratification of its amendment to the Black Stone Unit bars the Joyce DuJay claimants from a recovery on all of their claims. On appeal, Samson contends the trial court erred by failing to grant its motion for summary judgment because the summary judgment evidence conclusively establishes that the Joyce DuJay claimants ratified its decision to amend the Joyce DuJay Unit‘s boundaries.
In response to Samson‘s defense of ratification, the Joyce DuJay claimants assert that Samson waived its right to complain about the trial court‘s ruling in their favor on their breach of contract claims because it failed to timely assert its defense of ratification. The Joyce DuJay claimants note that Samson did not raise its ratification defense before the trial court ruled, in 2008, that they were entitled to prevail on their claims. In reply, Samson contends that it did not waive its defense by virtue of any delays because it presented its defense and obtained a ruling on it before the date the trial court rendered judgment. Having secured a ruling on its claim before the trial court rendered judgment, Samson argues that it properly preserved its right to our review of the merits
First, we address the Joyce DuJay claimants’ argument that Samson‘s failure to raise its ratification defense before the trial court ruled on its motion in 2008 resulted in a waiver of the defense. See generally
Because the trial court‘s 2008 order was interlocutory, and because Samson secured a ruling on its affirmative defense of ratification, the record shows that Samson presented its complaint to the trial court in a timely motion and that the trial court ruled on its request. See
Next, we consider the law related to ratification and the evidence of the circumstances that relate to Samson‘s decision to amend the Black Stone Unit. A doctrine of agency law, ratification is a common law doctrine that binds a person to another‘s unauthorized act if the person who is arguably bound is aware of the other‘s act, and, after becoming aware of the act, chooses to retain the benefits of the unauthorized act. See Willis v. Donnelly, 199 S.W.3d 262, 273 (Tex. 2006). According to Samson, the Joyce DuJay claimants were notified of the amendment to the Black Stone Unit‘s boundaries, and afterward, they accepted royalty payments that were calculated based on the boundaries established for the Joyce DuJay Unit, whose boundaries did not include the gas and condensate being produced by the Black-Stone-lease well. Additionally, according to Samson, the Joyce DuJay claimants never challenged its authority to amend the boundaries of the original unit.
In cases that concern the purchase and sale of minerals and mineral interests, the doctrine of ratification is used to hold a party to the terms of an amended contract when the party complaining about the amendment accepted the benefits of the new agreement, even though it could have resisted doing so. See Fortune Prod. Co. v. Conoco, Inc., 52 S.W.3d 671, 676 (Tex. 2000) (“We agree with the courts below that there may be circumstances under which a party who was induced to enter a contract by fraud may ratify that contract in such a manner that a claim for damages is foreclosed.“); Thomson Oil Royalty, LLC v. Graham, 351 S.W.3d 162, 166 (Tex. App.—Tyler 2011, no pet.) (“A party that accepts changed terms of a contract is deemed to have made its own decision that
In this case, it is undisputed that the Joyce DuJay claimants accepted royalties attributable to another well that Samson successfully completed on the Joyce DuJay lease that were calculated based on the smaller number of surface acres that are contained in the amended unit. The Joyce DuJay claimants also do not dispute that they never sought to have the amendment rescinded or to have it declared void, even though the amendment redefined the boundaries of the unit‘s pool and changed the surface acres of their unit.
In Hooks v. Samson Lone Star, Limited Partnership, 457 S.W.3d 52, 65-66 (Tex. 2015), the Texas Supreme Court held that a group of similarly situated stakeholders in the Black Stone Unit, who through the amendment became stakeholders in the Joyce DuJay Unit, had ratified the same amendment that is at issue in this case. In Hooks, the similarly situated group of plaintiffs asserted that Samson owed them royalties based on the production from the Black-Stone-lease well. Like the Joyce DuJay claimants, the stakeholders in the Joyce DuJay Unit in Hooks were aware that Samson had amended the Black Stone Unit. After the unit‘s amendment, the stakeholders in Hooks regularly accepted royalties on gas and condensate production that occurred from the Joyce DuJay Unit‘s pool. Id. Based on similar conduct as the conduct that is at issue here, the Texas Supreme Court held that the stakeholders in Hooks could not claim they were due additional royalties based on the production from the Black-Stone-lease well which was no longer within the amended unit‘s boundaries because by their acts, they had ratified the amendment to the Black Stone Unit. Id. at 66. Under these circumstances, the Supreme Court rendered judgment in Samson‘s favor based on the conclusive evidence before it of the stakeholders’ acts.
After carefully reviewing the summary judgment evidence, we find no significant distinction between the acts of the stakeholders in the Joyce DuJay Unit that are at issue here and the acts the Supreme Court relied on in Hooks to conclude that by such acts, Samson‘s amendment was ratified and had been accepted. Because the summary judgment evidence conclusively establishes that the Joyce DuJay claimants ratified the amendment to their unit, Samson was no longer obligated to attribute any of the production from the Black-Stone-lease well to the Joyce DuJay Unit. We reverse the principal and interest awards the trial court awarded to the Joyce DuJay claimants on their claims that are based on the production of the Black-Stone-lease well,12 and we render judgment in Samson‘s favor with respect to these claims.
DuJay-A Claimants
Contentions of the Parties
Next, we turn to the claims of the DuJay-A claimants, which concern whether they are entitled to share in the production from a well13 that produces in a zone that
In its appeal, Samson advances several arguments to support its claim that the trial court‘s judgment in favor of the DuJay-A claimants should be reversed. First, Samson argues that the trial court erred in failing to apply the statute of limitations as a bar to the DuJay-A claimants’ breach of contract claims. Second, Samson contends that the trial court erred in rejecting its arguments that the doctrines of estoppel, ratification, and waiver applied to the DuJay-A stakeholders’ claims. Third, Samson suggests that to require it to pay royalties on the production from the well on the Joyce DuJay lease to the unitholders of both the Joyce DuJay and DuJay-A Units is impracticable. Fourth, Samson asserts the trial court improperly construed the agreements when determining the boundaries of the DuJay-A Unit‘s pool. It argues that a proper construction of the documents relevant to the boundaries of the DuJay-A Unit‘s pool reveals that the two pools do not share a common zone. Fifth, Samson suggests that the trial court erred in failing to excuse what it characterizes as a mistaken description of the DuJay-A Unit‘s boundaries. Sixth, and as an alternative to its arguments that suggest the pools do not overlap, Samson argues that it is entitled to a trial on its claim seeking reimbursement for overpaying royalties to the Joyce DuJay claimants.
The DuJay-A claimants contend the trial court did not err in granting a summary judgment in its favor on all of Samson‘s defenses, including Samson‘s claim for reimbursement. By cross-appeal, the DuJay-A claimants contend that the damages they were awarded are too small. According to the DuJay-A claimants, the trial court erred by discounting their awards based on their ownership of less than all of the minerals in the T.S. Reed tract.
According to Samson, the four-year statute of limitations applies to the DuJay-A claimants’ suit. See
The record shows that the DuJay-A claimants were parties to the case by November 16, 2006, the date they filed their Fifth Amended Original Petition. Under the Texas Rules of Civil Procedure, a pleading of a claim for relief is required to
In their Fifth Amended Petition, the DuJay-A claimants alleged that Samson designated a zone for a unit without designating a lower boundary, they identified that production occurred in a zone produced by a well completed on the Joyce DuJay lease, they alleged that the Hardin County tracts that Samson pooled into the DuJay-A Unit include the same tracts that were pooled into the Joyce DuJay Unit, and they alleged that Samson had breached its lease because it failed to pay them the royalties they were owed. In our opinion, the Fifth Amended petition raises a claim for nonpayment of royalties that is consistent with the claim on which the trial court awarded damages.14 We hold that the Fifth Amended Petition relates to the claims that the DuJay-A claimants raised in their live pleading, their Tenth Amended Petition.
The Tenth Amended Petition contains more specific pleadings regarding the DuJay-A claimants’ theory that Samson had breached its lease by refusing to allocate any of the production occurring from the well on the Joyce DuJay lease to the DuJay-A Unit. Section 16.068 of the Texas Civil Practice and Remedies Code creates a relation back rule for claims, as it provides:
If a filed pleading relates to a cause of action, cross action, counterclaim, or defense that is not subject to a plea of limitation when the pleading is filed, a subsequent amendment or supplement to the pleading that changes the facts or grounds of liability or defense is not subject to a plea of limitation unless the amendment or supplement is wholly based on a new, distinct, or different transaction or occurrence.
Estoppel, Ratification, and Waiver
According to Samson, the summary judgment evidence was conclusive or raised fact issues on its defenses alleging theories of estoppel, ratification, and waiver. Samson contends that the evidence shows: (1) it advised the DuJay-A claimants that they had no interest in the well located on the Joyce DuJay lease, (2) the DuJay-A claimants expressly agreed to pool 213.038 acres of their land into a unit that it created “in order to form the Unit for the [DuJay-A] Unit Well,” (3) Samson
Samson discusses its defenses of waiver, ratification, and estoppel as a single group as if the three theories are all based on the same elements; its brief does not address the elements of the defenses, which are not identical, separately. Consequently, we interpret Samson‘s argument regarding these defenses as asserting a defense of quasi-estoppel, a doctrine that “precludes a party from asserting, to another‘s disadvantage, a right inconsistent with a position previously taken.” Lopez v. Muñoz, Hockema & Reed, L.L.P., 22 S.W.3d 857, 864 (Tex. 2000). “The doctrine applies when it would be unconscionable to allow a party to maintain a position inconsistent with one to which the party acquiesced, or from which the party accepted a benefit.” Cimarron Country Prop. Owners Ass‘n v. Keen, 117 S.W.3d 509, 511 (Tex.App.—Beaumont 2003, no pet.).
Samson relies heavily on the Texas Supreme Court‘s decision in Hooks v. Samson Lone Star Limited Partnership and the First Court of Appeals’ decision in that same case, which the Supreme Court reversed, to support its quasi-estoppel arguments. See Samson Lone Star, Ltd. P‘ship v. Hooks, 389 S.W.3d 409 (Tex. App.—Houston [1st Dist.] 2012), rev‘d in part, Hooks v. Samson Lone Star, Ltd. P‘ship, 457 S.W.3d 52 (Tex. 2015). However, there are significant differences between the facts in Hooks, which concerned the Black Stone Unit and Samson‘s amendment of that unit and the facts regarding the actions of the parties as related to the DuJay-A Unit. See Hooks v. Samson Lone Star, Ltd. P‘ship, 457 S.W.3d at 65-66.
Unlike the facts that surround Samson‘s amendment to the original Black Stone Unit, Samson never filed an amendment in the property records of Hardin or Jefferson County to change the boundaries of the pool that created the DuJay-A Unit. Thus, unlike Hooks, Samson never clearly placed the DuJay-A claimants on notice that it was offering them another bargain. See id. Instead, Samson acts as if its decision to create overlapping units should simply be overlooked, even though it never filed a document to amend the boundaries of the DuJay-A Unit to correct its alleged mistake. Instead, by allocating all of the production from the well that produces from a common zone to only the Joyce DuJay Unit, Samson simply ignores its own filing as if the pool it described created boundaries different than those reflected by its filings.
Samson also argues that by cashing their royalty checks, the DuJay-A claimants acted in a manner that is inconsistent with the terms of the division orders that are in the record that is before us. The division orders relevant to the DuJay-A Unit share the following language, which states: “THIS DIVISION ORDER DOES NOT AMEND ANY LEASE OR OPERATING AGREEMENT BETWEEN THE INTEREST OWNER AND THE PAYOR, THE LESSEE, OR THE OPERATOR, OR ANY OTHER CONTRACTS FOR THE PURCHASE OF OIL, GAS, OR OTHER HYDROCARBONS.” Given this language, we are not persuaded an act of cashing a royalty check is conduct that is inconsistent with a claim that the check was not calculated in accordance with the terms of the parties’ written agreement, their lease. Additionally, the royalty checks in the summary judgment record do not contain any language indicating the checks were tendered in full and final settlement of the royalties that were then due. Cf. Yelderman v. McCarthy, 474 S.W.2d 781, 783-84 (Tex.Civ. App.—Houston [1st Dist.] 1971, writ ref‘d n.r.e.) (holding that in an action to recover royalties, where the checks contained language indicating the check was being tendered as payment in full, that the lessor‘s notation on the checks, stating the check was being accepted as partial payment only, could not vary the language the issuer had placed on the check).
Finally, in this case, Samson never amended the declaration that it filed with respect to the boundaries of the DuJay-A Unit‘s pool. Instead, even after the suit was filed, and Samson was placed on notice of the claims that it was not properly allocating production in the common zone to both units, Samson did not suspend the disputed royalties pending the outcome of the case. Instead, it proceeded as if the DuJay-A Unit‘s pool did not overlap with the Joyce DuJay Unit‘s pool.
We conclude that Samson calculated that it would derive a greater benefit from refusing to amend the boundaries of the DuJay-A Unit‘s pool to correct its alleged mistake. Given that circumstance, it is not unconscionable that Samson be required to answer in damages based strictly on the DuJay-A claimant‘s theory that Samson had breached the T.S. Reed lease. We hold that there is no dispute on any material fact regarding the elements of a claim of quasi-estoppel, and that under the circumstances of this case, equitable relief is not proper, expedient, or necessary. See State v. Tex. Pet Foods, Inc., 591 S.W.2d 800, 803 (Tex. 1979) (explaining that the jury decides if there are questions of fact in dispute but that it does not determine the expediency, necessity, or propriety of equitable relief); Cimarron, 117 S.W.3d at 512. We hold the trial court did not err granting the DuJay-A claimants’ motion for summary judgment on Samson‘s claims based on waiver, ratification, and estoppel.
Samson argues that performing under the terms of its written agreement was impossible16 because the law does not authorize it to create pools that share a common zone. However, it cites no statute that prohibits it from creating such a pool, and it cites no cases holding that a lessee with broad pooling authority cannot exercise its authority in such a manner.
In response to Samson‘s claim of impracticability,17 the DuJay-A claimants argue that the pooling authority provision of their lease does not prohibit Samson from forming a pool for the DuJay-A Unit that shares a common zone with another unit‘s pool. Relying on Southland Royalty Company v. Humble Oil & Refining Company, 151 Tex. 324, 249 S.W.2d 914, 916-17 (Tex. 1952), and Sohio Petroleum Company v. Jurek, 248 S.W.2d 294, 298 (Tex.Civ.App.—Fort Worth 1952, writ ref‘d n.r.e.), the DuJay-A claimants point to the declarations that Samson filed for the Joyce DuJay and DuJay-A Units that created pools with a large area that overlaps. According to the DuJay-A claimants, Samson could create units with common zones because the law “does not require a cross-conveyance between the lessors.”
Significantly, the case at bar was not tried as a trespass to try title case; instead, the trial court awarded contract damages under the DuJay-A claimants’ breach of contract theory. Additionally,
Nonetheless, we are required to address whether the T.S. Reed lease restricted Samson‘s authority to create the pool that Samson described in the declaration that it filed to create the DuJay-A Unit. Whether Samson was authorized to create the pool at issue concerns a matter of contract law. See Wagner & Brown, Ltd. v. Sheppard, 282 S.W.3d 419, 424 (Tex. 2008) (noting that “oil and gas leases in general, and pooling clauses in particular, are a matter of contract“). Therefore, we look to the language of the parties’ lease and the lease amendment to determine the scope of Samson‘s authority regarding its pooling of the T.S. Reed lease.
Under the lease between Samson and T.S. Reed, Samson could not pool T.S. Reed‘s tract unless all of the acreage of the tract was pooled. In August 2002, Samson and T.S. Reed agreed to amend the pooling provision, and T.S. Reed‘s president gave “Samson the right to pool 213.038 acres of land ... to form the Unit for the [DuJay-A] Unit Well.” However, the amendment does not describe the boundaries of the proposed unit. When the lease was amended in 2002, Samson had not yet designated the boundaries of the DuJay-A Unit‘s pool, although it is clear that the pool was to include the well on the DuJay-A lease. However, there is no indication in the amendment that the well on the DuJay-A lease was the only well that Samson intended to include in the pool. Significantly, the only restrictions on Samson‘s pooling authority regarding the 213-acre tract are that Samson was required to pool the entire 213-acre tract and the tract was to be pooled into the DuJay-A Unit.19
In this case, none of the parties has claimed that Samson exercised its pooling authority in bad faith, and Samson never amended the boundaries of the DuJay-A Unit‘s pool. Because there is no claim the tract was pooled in bad faith, and in light of the broad pooling authority T.S. Reed gave Samson in the amendment to pool the tract, we conclude that the parties’ agreement did not restrict Samson from pooling the lease into a pool that overlapped the pool of another preexisting unit. See Se. Pipe Line Co., Inc. v. Tichacek, 997 S.W.2d 166, 170 (Tex, 1999) (“A lessee‘s pooling decision will be upheld unless the lessee pools in bad faith.“).
Next, we consider Samson‘s argument that enforcing its obligations under its lease, which requires it to account for production that occurred in a shared zone, is impossible. Under Texas law, a defendant may defend a claim for breach of contract by showing that the obligation it undertook to perform was rendered impracticable. See Centex Corp. v. Dalton, 840 S.W.2d 952, 954 (Tex. 1992) (relying on the defense of supervening impracticability, as stated in the
§ 261. Discharge by Supervening Impracticability
Where, after a contract is made, a party‘s performance is made impracticable without his fault by the occurrence of an event the non-occurrence of which was a basic assumption on which the contract was made, his duty to render that performance is discharged, unless the language or the circumstances indicate the contrary.
Under the circumstances presented in this case, none of the summary judgment evidence shows that any of the DuJay-A claimants were involved in the decisions Samson made to establish the boundaries of the pools at issue, nor was there any evidence that the DuJay-A claimants were on notice of the unit‘s boundaries before Samson filed the document that declared them. Additionally, not any of the Restatement exceptions apply, as the condition frustrating Samson‘s performance is wholly based on its own fault in creating overlapping pools. Id. Under the circumstances shown by the summary judgment evidence, the trial court did not err when it granted the DuJay-A claimants’ motion for summary judgment on Samson‘s defense of impossibility.
Construing T.S. Reed Lease to Avoid Overlapping Pools
Samson argues the T.S. Reed lease should be construed so the boundaries of the DuJay-A Unit‘s pool are established as existing at 12,000 feet to 12,399 feet subsurface. In response, the DuJay-A claimants contend that the provisions in the T.S. Reed lease are not relevant to the boundaries that Samson established for the DuJay-A Unit‘s pool.
Prior to the amendment previously discussed, T.S. Reed‘s lease required that each production unit “shall be limited to a depth of one hundred feet (100‘) below the total depth to which the first productive well is drilled on the unit, which depth shall be determined by a Schlumberger, Halliburton, or other electrical log, which Lessee shall cause to be run.” Samson notes that the well on the DuJay-A lease was drilled to a depth of 12,500 feet, and it relies on the above provisions to conclude that T.S. Reed‘s lease “created an automatic depth limitation on the [DuJay-A Unit] of 12,600 [feet].”
Samson‘s argument is presented in an effort to rewrite the unambiguous boundaries of the pool that it declared when it created the DuJay-A Unit. Additionally, if the question is one of authority, the DuJay-A claimants ratified Samson‘s act to create the overlapping pools when they
Nevertheless, even if the terms of the original T.S. Reed lease are relevant to determining the boundaries of the DuJay-A Unit‘s pool, Samson‘s argument does not prevent the pools from overlapping so that they share the zone of production that is at issue here. The first productive well in the DuJay-A Unit is the well located on the Joyce DuJay lease, as it was completed before the well was completed on the DuJay-A lease. Thus, the bottom for the DuJay-A Unit‘s pool would still overlap the zone that includes the level being produced by the well on the Joyce DuJay lease. While Samson raises other arguments regarding other provisions in the original T.S. Reed lease in an effort to rewrite the boundaries for the pool that it declared for the DuJay-A Unit, Samson never explains how any of the restrictions upon which it relies survived the lease‘s 2002 amendment that specifically authorized Samson to pool the 213 acre tract at issue into the DuJay-A Unit.
Given the unambiguous language in the unit declaration that established the boundaries of the DuJay-A Unit‘s pool, the trial court properly rejected Samson‘s arguments that the language in other documents was relevant to establishing the pool‘s boundaries. See Sheppard, 282 S.W.3d at 422 (“A lease is not necessarily required for pooling; mineral owners can join a pool even if no lease exists.“). We overrule Samson‘s arguments that suggest the trial court did not properly construe the documents relevant to defining the DuJay-A Unit‘s pool.
Scrivener‘s Error
Samson also argues that the trial court erred by failing to reform the boundaries of the DuJay-A Unit‘s pool because it mistakenly created a pool for the unit that shared a zone with another pool. Samson suggests the mistake that was made to define the boundaries of the pool was that of its attorney, and it suggests that the document it filed should have indicated that the pool was bottomed at approximately 12,400 feet.
In response, the DuJay-A claimants argue that pool‘s boundaries cannot be reformed because Samson failed to request they be reformed within four years of the date that Samson declared the pool to exist.20
The DuJay-A claimants assert Samson‘s request to reform the size of the DuJay-A Unit‘s pool is barred by the four-year statute of limitations. Additionally, the DuJay-A claimants contend that the summary judgment evidence shows that Samson acted without their involvement in designating the boundaries of the DuJay-A Unit‘s pool, and they conclude that Samson‘s alleged mistake in defining the pool‘s size was not mutual. They further contend that Samson was required but failed to show that (1) the contract would be unconscionable, (2) the mistake concerned a material feature of the contract, (3)
First, we consider Samson‘s claim that it should be allowed to avoid the terms of its declaration, which defined the boundaries of the pool, based on the doctrine of mutual mistake.21 See
In its response to the DuJay-A claimants’ no-evidence motion, Samson did not present any evidence showing that the DuJay-A claimants were acting under any misunderstanding about the depth of the pool either when their leases were pooled or when Samson filed the document that declared the pool‘s boundaries. Instead, the summary judgment evidence shows that the mistake was Samson‘s alone.
With respect to the circumstances explaining why the boundaries are declared as stated in the document that Samson filed, Samson‘s summary judgment evidence includes the unsworn declarations22 of Eric Lindahl, the attorney who drafted the designation creating the DuJay-A Unit, and Richard Koenig, Samson‘s land manager. This evidence shows that Samson and Samson‘s agents were responsible for creating the document that contains the boundaries of the DuJay-A Unit‘s pool. Lindahl‘s unsworn declaration indicates that he sent Samson a draft designation of the gas unit for the DuJay-A Unit‘s pool in April 2003. The April 2003 draft describes the top of the pool at 6,000 feet subsurface, and the draft designates a lower boundary for the pool of 12,400 feet subsurface. In June 2003, Lindahl sent Koenig a revised designation for the unit: the revised designation changed the depth of the pool‘s lower boundary from 12,400 feet “to depths below 12,000 feet subsurface.” In his declaration, Lindahl indicates that he never intended to create a pool that overlapped with Joyce DuJay Unit‘s pool; he further declared, “I do not remember why the change was requested.” While Lindahl indicated that he could not recall the reasons for the change in the boundaries from the boundaries reflected in a prior draft, Lindahl states that “it would have been a mistake to include depths in the [DuJay-A] Unit that were already included in the [Joyce DuJay Unit].” According to Lindahl: “It was a scrivener‘s error for the unit designation of the [DuJay-A] Unit not to have stated a depth limitation of 12,400 [feet].” None of the statements in Lindahl‘s unsworn decla
Koenig‘s unsworn declaration also reveals no involvement of the DuJay-A claimants in the drafting of the documents to create the DuJay-A Unit‘s pool. His declaration, like Lindahl‘s, shows that Samson and its agents were solely responsible for the filing of the document declaring the pool‘s boundaries. According to Koenig, Samson always intended “to designate the [DuJay-A Unit] to have a bottom limitation of 12,400 feet subsurface.” Koenig‘s declaration is silent about the intentions of the DuJay-A claimants and if they were consulted on sizing the DuJay-A Unit‘s pool. In his declaration, Koenig explains that Samson‘s file on the DuJay-A Unit contains an interoffice memo, dated May 2003, that contains the notation “‘[r]e-routed 7-2-03 12,000’ & below.‘” Koenig concludes that it was a mistake not to include a lower boundary for the DuJay-A Unit‘s pool, but his declaration does not further discuss why Samson made the decision to change the pool‘s lower depth to 12,000 feet and below.
Generally, “[a] mistake by only one party to an agreement, not known to or induced by acts of the other party will not constitute grounds for relief.” Johnson v. Snell, 504 S.W.2d 397, 399 (Tex. 1973). Additionally, the acts of Samson‘s attorney are attributed to Samson. See Gavenda v. Strata Energy, Inc., 705 S.W.2d 690, 693 (Tex. 1986). Lindahl‘s suggestion that he committed a scrivener‘s error is also no evidence to show that the alleged mistake is one that was made by the parties mutually. See Elizondo v. Krist, 415 S.W.3d 259, 264 (Tex. 2013) (“[A]n attorney-expert, however well qualified, cannot defeat summary judgment if there are fatal gaps in his analysis[.]“); McIntyre v. Ramirez, 109 S.W.3d 741, 749-50 (Tex. 2003) (“A conclusory statement of an expert witness is insufficient to create a question of fact to defeat summary judgment.“). Brown v. Havard, 593 S.W.2d 939, 942 (Tex. 1980). While the declarations of Samson‘s attorney and its land manager suggest that Samson made a mistake, the declarations are no evidence to show that the mistake was one that was mutual. We conclude that the trial court did not err by granting the DuJay-A claimants’ no-evidence motion with respect to Samson‘s claimed mistake.23
Samson also asked the trial court to order the Joyce DuJay claimants to reimburse it for a portion of the damages the DuJay-A claimants were awarded in the judgment. According to Samson, the Joyce DuJay stakeholders were unjustly enriched because they benefitted from Samson‘s decision to attribute all of the production from the well on the Joyce DuJay lease to the Joyce DuJay Unit. Samson contends the Joyce DuJay claimants24 should be required to disgorge $437,284, the amount that Samson asserts they received in excess of what they would have been paid had it attributed the production from the well on the Joyce DuJay lease to the stakeholders in both the Joyce DuJay and the DuJay-A Units.
In response to Samson‘s equitable reimbursement claim, the Joyce DuJay claimants, as counter-defendants, filed a motion for summary judgment on traditional and no-evidence grounds. See
On appeal, Samson argues the trial court‘s ruling should be reversed because it established its claim for money had and received as a matter of law, or because the evidence in the summary judgment proceedings relevant to its claim presented issues of fact that should be resolved by a trial. A party asserting a claim for money had and received must prove that the opposing party is holding money that in equity and good conscience belongs to it. See Staats v. Miller, 150 Tex. 581, 243 S.W.2d 686, 687-88 (1951); Edwards v. Mid-Continent Office Distrib., L.P., 252 S.W.3d 833, 837 (Tex. App.—Dallas 2008, pet. denied).
First, we address Samson‘s argument that it presented more than a scintilla of evidence to support its claim that the Joyce DuJay claimants had money that belongs to it. See Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex. 2004). In their no-evidence motion, the Joyce DuJay claimants challenged Samson to produce evidence that they had money that in equity belonged to Samson. In response to their no-evidence motion, Samson referred the trial court to several declarations signed by Samson‘s chief financial officer, C. Philip Tholen. Samson contends that Tholen‘s declarations demonstrate that the Joyce DuJay claimants received greater royalties than they would have received
In our opinion, Tholen‘s declarations are some evidence showing that the royalty payments to the Joyce DuJay claimants would have been smaller had Samson attributed the production for the well to both units.25 In his January 2013 declaration, Tholen states that Samson has been paying the total amount of royalty owed pursuant to its division orders from the date the well on the Joyce DuJay lease first produced minerals. Tholen‘s declaration then explains that because Samson attributed all of the production from the well on the Joyce DuJay lease to the stakeholders in the Joyce DuJay Unit, they received more than they would have received in royalties had the production been attributed to both of the units. Tholen‘s declaration includes various schedules and letters, and these demonstrate how much money the Joyce DuJay claimants received over what they would have been paid had Samson allocated the production from the well on the Joyce DuJay lease to both units. According to Tholen, the Joyce DuJay claimants received $437,284 more than they would have otherwise received. We conclude there is some evidence supporting Samson‘s claim of money had and received.
Next, we consider the grounds on which the Joyce DuJay claimants obtained summary judgment on their traditional motion. See Knott, 128 S.W.3d at 216; see also Ridgway, 135 S.W.3d at 600. With respect to their traditional motion, the Joyce DuJay claimants argued that Samson‘s decision to allocate the production was a decision that it made voluntarily. The Joyce DuJay claimants point out that Samson continued to allocate the production from the well on the Joyce DuJay lease solely to the Joyce DuJay Unit even after it was presented with claims and sued over whether it was properly calculating the royalties due the stakeholders in the two units.
In part, as a defense to Samson‘s claim for reimbursement, the Joyce DuJay stakeholders’ motion for summary judgment relies on the voluntary-payment rule. The voluntary-payment rule operates as a defense to a claim seeking restitution, and can be stated as follows: “Money voluntarily paid on a claim of right, with full knowledge of all the facts, in the absence of fraud, deception, duress, or compulsion, cannot be recovered back merely because the party at the time of payment was ignorant of or mistook the law as to his liability.” BMG Direct Mktg., Inc. v. Peake, 178 S.W.3d 763, 768 (Tex. 2005) (citing Pennell v. United Ins. Co., 243 S.W.2d 572, 576 (1951)) (quoting 40 Am. Jur. § 205 (1942)).
The summary judgment motions reflect Samson‘s confidence in its position that the courts would revise the boundaries of the DuJay-A Unit‘s pool to create a pool that did share any zones with the Joyce DuJay Unit‘s pool. The summary judgment evidence also shows that although Samson asked the court to revise the boundaries of the DuJay-A Unit‘s pool, it never exercised its authority to amend the designation of the declaration, even though the designation that it filed expressly provided that Samson reserved the right to do so “in order to correct any error herein[.]” We conclude that the summary judgment evidence conclusively shows that Samson‘s
Samson did not allege that any of the Joyce DuJay claimants were guilty of any acts of fraud, that it paid the royalties under duress, or that it was compelled to pay royalties over its objection to doing so. Instead, Samson continued to pay the royalties at issue to the Joyce DuJay claimants after it became involved in this litigation, which questioned whether it had properly accounted for the royalties between the two units. Under the circumstances, the summary judgment evidence conclusively established that Samson‘s payments of royalties to the Joyce DuJay claimants were voluntary. See Pennell, 243 S.W.2d at 576. We hold that the trial court did not err in granting the Joyce DuJay claimants’ traditional motion for summary judgment on the grounds that Samson‘s payments were voluntary.
Damages
NPRI Parties
In its appeal, Samson contends the trial court erred when it concluded that eight of the parties (NPRI parties),26 stakeholders in the DuJay-A Unit through their interests as nonparticipating royalty owners in the T.S. Reed lease, were entitled to collect interest on the royalties that Samson ultimately acknowledged that it owed and paid to them as stakeholders in the DuJay-A Unit. According to Samson, the awards to the NPRI parties are excessive because the awards include interest calculated from January 2002, the date the well on the Joyce DuJay lease first began producing minerals. Samson contends the interest awards should have been calculated from October 2007, the date the NPRI parties agreed with T.S. Reed‘s decision to allow Samson to pool its 213 acre tract into the DuJay-A Unit. In response, the NPRI parties argue that Samson waived any error with respect to the manner the trial court calculated their interest awards because Samson failed to timely object in the trial court to the manner in which their awards were calculated.
Before evaluating the merits of Samson‘s argument that the awards were excessive, we consider the NPRI parties’ suggestion that Samson failed to properly preserve its argument on this issue for our review on appeal. To support their claim of waiver, the NPRI parties rely on City of Houston v. Clear Creek Basin Authority, 589 S.W.2d 671 (Tex. 1979). However, in Clear Creek, the party that moved for summary judgment was the defendant, and the error preservation argument concerned whether the plaintiff waived its argument on appeal regarding a theory of liability that it failed to present at trial. Id. at 672-75.
In this case, the question is whether the NPRI parties, as the parties who moved for summary judgment, conclusively proved the amounts of their accrued unpaid royalties, which form the royalty amounts on which their awards of interest
In evaluating whether the evidence on the awards to the NPRI parties was conclusive, we note that their awards are based on royalties that are calculated beginning with the date the well on the DuJay-A lease first began to produce gas. However, the NPRI owners did not act to ratify the T.S. Reed lease or the lease‘s amendment for several years after the well on the DuJay-A lease first produced gas.28
In Montgomery v. Rittersbacher, the Texas Supreme Court explained that an NPRI owner may ratify a lease that the holder of the executive rights made with a lessee by signing the lease or by filing suit to enforce the lease. 424 S.W.2d at 214-15. In resolving an appeal that arose from a non-jury trial, the Montgomery Court noted that the NPRI owner “ratified the lease in question by filing suit; consequently, he is only entitled to receive royalties accruing from and after [] the date this suit was filed.” Id. at 215.
In this case, the interest awards were calculated based on royalties that would have become due assuming the NPRI parties ratified the T.S. Reed lease as of September 2002; however, by September 2002, they had not done so and would not do so for years. Therefore, the interest awards are excessive because they exceed the amounts supported by the summary judgment evidence. We reverse the interest awards with respect to the NPRI parties, and we remand these claims to the trial court for further proceedings.
Accrued Unpaid Royalties Awards to the Simpson-Omohundro Foundation and the Marlborough School
Samson also challenges the amounts the trial court awarded in interest to two of the stakeholders in the Joyce DuJay Unit, the Simpson-Omohundro Foundation and the Marlborough School.29 According to Samson, the trial court‘s awards of interest to these two parties should be reversed because by statute, an operator of a well does not owe interest on delays that are attributable to the time the operator must spend to determine whether a party claiming an interest in the minerals to a well actually own the interest that is claimed.
Ultimately, Samson recognized that the Simpson-Omohundro Foundation and the
The Simpson-Omohundro Foundation‘s and the Marlborough School‘s claims are based on a lease between Samson, the Simpson-Omohundro Foundation, and Nancy Long.30 Samson argues that it does not owe interest because “there were title issues as to these parties’ interests.” According to Samson, the lease excused its obligation to pay interest on suspended royalties if the royalties were suspended due to title questions. In this case, the lease between Samson, the Simpson-Omohundro Foundation, and Long contains the following provision:
Royalties payable under the terms hereof shall be due and payable to Lessor within sixty (60) days after the sale of any produce produced hereunder. Any royalties unpaid within sixty (60) days after the sale of any product produced hereunder, including suspended royalties, shall bear interest at the prevailing New York prime rate until paid.
We find nothing in the lease to support Samson‘s argument that its obligation to pay interest on suspended royalties was excused. The summary judgment evidence does not show that there was a bona fide dispute regarding the Simpson-Omohundro Foundation‘s or Nancy Long‘s title to the minerals in the tract that Long and the Foundation leased to Samson. There was also no evidence of a bona fide dispute that Long, through her will, had not given her interest in the lease to the Marlborough School.
Samson relies on
We do not read
With respect to the judgment‘s award of interest on suspended royalties,31 we af
Remaining Damages Arguments
Samson raises three additional arguments that suggest the evidence does not support the amount the trial court awarded in damages to the DuJay-A claimants.32 First, Samson argues that the trial court erroneously calculated the awards because the awards include damages that were based on royalties before the T.S. Reed lease became effective in April 2002. Second, and alternatively, Samson contends that the trial court‘s awards include damages based on royalties for gas produced before the DuJay-A Unit existed. Third, Samson argues the trial court erred by awarding interest to the DuJay-A claimants based on the rates of interest that exceed the rates of interest that are found in
In resolving whether the trial court properly calculated the royalty payments at issue, we look to the terms of the parties’ lease. Tittizer v. Union Gas Corp., 171 S.W.3d 857, 860 (Tex. 2005). The T.S. Reed lease established the deadlines by which royalties became due.33 Significantly, nothing in the lease indicates that the parties made the deadline by which Samson was required to tender royalties contingent on the date the lease became effective. Samson‘s argument that no royalties were earned prior to April 2002 is not supported by the language in the lease.
Samson also argues that the trial court‘s damages awards include damages for production that dates from January 2002, despite the fact that the DuJay-A Unit was created months later and the filing that created the unit made the unit effective as of first production from the well on the DuJay-A lease, a well that Samson did not complete until September 2002. See generally Hooks, 457 S.W.3d at 65 (noting that the language in a unit designation made the designation of the unit effective as of date of first production). However, the designation Samson filed to create the DuJay-A Unit declares that the Unit is effective as of the date of first production of the [DuJay-A] Well,” even though the declaration was actually filed after the date the well on the DuJay-A lease began producing gas. From the information in the summary judgment evidence, it appears that the well on the
In this case, the trial court‘s damages awards include damages that are calculated based on the royalties the DuJay-A claimants were owed on gas produced before the date the DuJay-A Unit existed. We agree with Samson that the damages awarded to the DuJay-A claimants exceed the amounts the summary judgment evidence supports. We reverse the principal and interest awards to the DuJay-A claimants because the awards are excessive, and we remand the case for further proceedings so the awards can be calculated properly.
Third, with respect to the damages award, Samson also contends that the DuJay-A claimants were awarded interest at rates that are higher than the rates allowed by Texas law. According to Samson, the prime rate of interest, at the time, exceeded the interest rate found in
Under the T.S. Reed lease, which provides a rate of interest that Samson was obligated to pay on royalties, the parties agreed that Samson would pay interest at “the prime rate of interest at Chase-Manhattan Bank in New York City, New York, plus 2% (not to exceed legal Texas interest rate)[.]” According to the DuJay-A claimants, the “not to exceed” language of the provision was intended to reference the maximum interest allowable under
In our opinion, the “not to exceed” provision of the lease was intended to reference the Texas Finance Code, not the Texas Natural Resource Code. Under the Texas Natural Resource Code, the interest rate provided by that Code does not apply if the parties have specified a rate of interest under their written agreement. See
The Texas Finance Code creates a maximum rate of interest that generally applies to all contracts, unless the parties have provided for another rate that is specified by the contract. See
Samson does not argue that the interest rates applied by the trial court were rates in excess of the ceilings found in the Texas Finance Code. We conclude Samson‘s argument that the trial court applied the
Cross-Appeal
In a cross-appeal, the DuJay-A claimants argue that the trial court‘s awards underestimate the damages they conclusively proved that they suffered based on Samson‘s breach. According to the DuJay-A claimants, the trial court erred by adjusting their damages to reflect the fact that they do not own all of the minerals on the 213 acre tract that Samson leased. In response, Samson contends the lease required the trial court to account for the DuJay-A claimant‘s partial ownership of the minerals to the tract.
Section VIII(b) of the T.S. Reed Properties lease provides that Samson was to compute the royalty on production from wells within the pooled unit as follows:
(b) Computing Royalties. For the purpose of computing the royalties to which owners of royalties and payments out of production shall be entitled on production of oil and gas, or either of them, from the pooled unit, there shall be allocated to the land covered by this lease and included in said unit a pro rata portion of the oil and gas, or either of them, produced from the pooled unit after deducting that used for operations on the pooled unit. Such allocation shall be on an acreage basis, that is, there shall be allocated to the acreage covered by this lease and included in the pooled unit that pro rata portion of the oil and gas, or either of them, produced from the pooled unit which the number of surface acres covered by this lease and included in the pooled unit bears to the total number of surface areas included in the pooled unit. Royalties hereunder shall be computed on the portion of such production, whether it be oil and gas, or either of them, so allocated to the land covered by this lease and included in the unit, just as though such production were from such land.
In addition to this provision, the lease between Samson and T.S. Reed includes a proportionate reduction clause. Section XIII, the proportionate reduction clause, provides:
[I]f this lease covers a less interest in the oil and gas in all or any part of the leased premises than the entire undivided fee simple estate, then the royalties, delay rental, and other monies accruing from any part as to which this lease covers less than such full interest shall be paid only in the proportion which the interest therein covered by this lease bears to the whole or undivided fee simple estate therein.
The DuJay-A claimants contend that section XIII does not apply because T.S. Reed Properties leased only the “net mineral acres” to Samson when it leased the tract. While the attachments to the lease do describe the net mineral acres in the tract that T.S. Reed Properties owned, the lease also has a proportionate reduction clause that applies to the royalties due to the lessor under the lease. Essentially, the DuJay-A claimants argue that the proportionate reduction clause is superfluous.
T.S. Reed relies primarily on Texas Co. v. Parks, 247 S.W.2d 179 (Tex. Civ. App.—Fort Worth 1952, writ ref‘d n.r.e.), to support its construction of the lease. In Parks, the Fort Worth Court of Appeals held that a proportionate reduction clause did not apply to reduce the lessor‘s obligation to pay delay rentals of $160, yearly. Id. at 182. Given the purpose of the delay
With respect to the T.S. Reed lease, the description of the tract in a document the parties attached to the lease describes the tract as “all that certain land,” which is then described in another exhibit to the lease. The exhibit referenced by the attachment describes the tract‘s surface acreage, the survey where the tract is located, the abstract number associated with the tract, the volume and page number of the deed records where a deed describing the tract can be found, and T.S. Reed‘s net mineral interest in the tract. In other words, the exhibit is descriptive of the property conveyed; it does not alter the parties’ bargain that T.S. Reed was to be paid royalties on the only minerals that it owned and leased in the tract.
The Texas Supreme Court has explained that “‘[l]and’ is the physical earth in its natural state, while an estate in land is a legal unit of ownership in the physical land.” Averyt v. Grande, Inc., 717 S.W.2d 891, 894 (Tex. 1986) (citing 1 Thompson, THOMPSON ON REAL PROPERTY § 52 (1939)). Given the language of the T.S. Reed Properties lease, the lease conveyed to Samson the right to use the entire surface for the purpose of exploring and producing oil and gas. Looking at the lease as a whole, from the granting clause to the reservation clause, it is evident that the term “all that certain land” does not refer to T.S. Reed‘s mineral estate but to the entire tract. Compare King v. First Nat‘l Bank of Wichita Falls, 144 Tex. 583, 192 S.W.2d 260, 263 (Tex. 1946).
Although Samson and the DuJay-A claimants interpret the lease differently, neither argues that the proportionate reduction provision of the lease is ambiguous. When an oil and gas lease is unambiguous, the lease must be enforced based on its unambiguous terms. Tittizer, 171 S.W.3d at 860. We hold that the trial court did not misconstrue the lease, and that it properly applied the proportionate reduction clause in calculating the DuJay-A claimants’ damages. The DuJay-A claimants’ issue in its cross-appeal is overruled.
Conclusion
We reverse and render judgment in favor of Samson with respect to the trial court‘s order granting awards to Patricia Belden; Roger Craddock and Iris Klorer Craddock, Individually and as Trustees of the Craddock Family Trust; Thomas Klorer; Valerie Klorer; Marlborough School, Simpson-Omohundro Foundation, the Sara Wilson Carlson Exempt Trust, through Capital One, N.A., its trustee; the Mark C. Wilson Grantor Trust, through Capital One, N.A., its trustee; Thomas Edwin Doran; and Gary Cruse, as Executor of the Estate of Vivian Burch.35 However, with respect to the trial court‘s awards for interest on suspended royalties to the Simpson-Omohundro Foundation and the
We also reverse all of the trial court‘s awards to the DuJay-A claimants because the awards are excessive, and they are remanded to the trial court for further proceedings consistent with the Court‘s opinion. Finally, with respect to those parties to the judgment who did not appeal, the judgment is affirmed.
AFFIRMED IN PART, REVERSED AND RENDERED IN PART, REVERSED AND REMANDED IN PART.
AC INTERESTS L.P., Formerly American Coatings, L.P., Appellant
v.
TEXAS COMMISSION ON ENVIRONMENTAL QUALITY, Appellee
NO. 01-15-00378-CV
Court of Appeals of Texas, Houston (1st Dist.).
Opinion issued February 11, 2016
Notes
- the mistake is of so great a consequence that to enforce the contract as made would be unconscionable;
- the mistake relates to a material feature of the contract;
- the mistake must have been made regardless of the exercise of ordinary care; and
- the parties can be placed in status quo in the equity sense, i.e., rescission must not result in prejudice to the other party except for the loss of his bargain.