Co-author Jonathan Nowlin I learned to drive on an old, black, stick-shift, straight-six, no-radio, no-A/C automobile manufactured the year after the AAPL’s first Form 610 - Model Form Operating Agreement was created. The ’57 Chevy is now considered a classic. Not so with the 1956 Model Form, which is generally considered a relic. Clovelly Oil Co., LLC v. Midstates Petroleum Co. shows that while… Continue Reading
Category Archives: Contract Disputes
Subscribe to Contract Disputes RSS FeedNo Agreement on Essential Terms Means No Contract
Posted in Contract DisputesIf your written agreement terminates and you engage in extensive discussions to reestablish the agreement but essential terms are not agreed on, you don’t have a binding contract. So said a Texas court in 2001 Trinity Fund, L.L.C. v. Carrizo Oil & Gas, Inc. Trading a bunch of emails without agreeing on the essential terms… Continue Reading
In Texas Contract Dispute, Risk Allocation Trumps Due Diligence Duties
Posted in Construction, Contract DisputesThere are certain cases that litigants and their lawyers find difficult to resolve: Lots of money on the line, two reasonable interpretations of a complicated agreement and, I suspect, parties who seek vindication for their actions. El Paso Field Services, L.P. v. MasTec North America, Inc. is one of those cases. The Question: In a pipeline… Continue Reading
Operator Not Liable for Breach of 1989 Model Form JOA, Part Two
Posted in Contract Disputes, Operating AgreementsCo-authored byMarty Averill As promised in our September 9 post, here is a more detailed analysis of Reeder v. Wood County Energy, LLC, et al, the recent Texas Supreme Court decision holding that an operator is not liable for breach of the 1989 model form JOA absent willful misconduct or gross negligence.
Buyer Recovers Damages for Over-Produced Gas Wells
Posted in Contract Disputes, Purchase and Sale AgreementsPetro-Hunt L.L.C. vs. Wapiti Energy L.L.C. causes one to think about the effect of a gas imbalances on a producing property acquisition and the importance of so-called “boilerplate” in the purchase agreement. It is also the saga of a bad day at the plate for the seller. Let’s say I sold you an interest in gas… Continue Reading
The Corporate Shield is Not Invincible
Posted in Contract DisputesThis non-oil and gas case should be of interest to startups and those of you who run “lean and mean” operation. Thanks to Jerry Murray at Goldin Peiser & Peiser, LLP for bringing it to my attention. You file the paperwork to set up a corporation so that your personal assets are shielded from assault by unprincipled plaintiff’s… Continue Reading
Texas Supreme Court Limits U.C.C. “Cover” Damages in Gas Supply Dispute
Posted in Contract DisputesBY CHANCE DECKER Here in the south, we know all bourbon is whisky, but not all whisky is bourbon. In El Paso Marketing, LP and Enterprise Pipeline LLC v. Wolf Hollow I, L.P., the Texas Supreme Court held that all natural gas is power, but not all power is natural gas. The Dispute This case… Continue Reading
Are We Partners or Not?
Posted in Contract DisputesWhy don’t we learn from other people’s mistakes? I have no idea, but Sewing v. Bowman is a good example of what happens when we don’t. The question was whether or not two friends of almost 50 years formed a partnership. This case is not about buying leases and drilling wells, but it very well could be. The court said… Continue Reading
Fraud in Texas: A Primer
Posted in Contract DisputesWas it your long-time confidant who says your fiancee isn’t good enough for you and then runs off and marries her, or a seller’s remorse on a hundred-million dollar scale? We don’t know yet, but in Allen v. Devon Energy Holdings, a Houston court set guidelines for the trial of a case involving redemption of a… Continue Reading
Jed Clampett Redux: The Dispute Began in Reeves County and Ended in Beverly Hills
Posted in Contract DisputesBeware of the law – and the location – you choose to resolve your contractual disputes. Choice of law and forum selection provisions are commonly used, often misunderstood, and frequently overlooked contract clauses that can significantly alter a litigant’s legal rights and remedies. Stokes Interest, G.P. v. Santo-Pietro, 2010 WL 2929534 (Tex. App.—El Paso) The… Continue Reading
The Burden of Due Diligence
Posted in Construction, Contract DisputesWhat happens when the owner’s promise that it has conducted due diligence collides with the contractor’s fixed price obligation?