If 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
In Texas Contract Dispute, Risk Allocation Trumps Due Diligence Duties
There 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
Operator Not Liable for Breach of 1989 Model Form JOA, Part Two
Co-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
Petro-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
The Corporate Shield is Not Invincible
This 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
Texas Supreme Court Limits U.C.C. “Cover” Damages in Gas Supply Dispute
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
Are We Partners or Not?
Why 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
Fraud in Texas: A Primer
Was 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 member’s ownership interest in a limited liability company for a fraction of the amount he would have received in the sale of the entire company 20 months later.
This was an appeal of a summary judgment, not a trial, so no actual wrongdoing by anyone was established.
The facts are complicated and the legal analysis is detailed, which makes this post longer than usual. For lawyers, it is a quick treatise on the ins and outs of fraud claims and a warning that the “boilerplate” in your agreements might not be as effective as you think. For non-lawyers, it is about legal issues that could affect behavior among members of LLCs and shareholders of corporations, whether majority or minority owners.
Having tried in vain to avoid the turgid legalese non-lawyers have come to expect from people like me, I’ve inserted musical interludes about cheatin’ and betrayal that should help alleviate the stupefying boredom you are about to experience. For example:
Jed Clampett Redux: The Dispute Began in Reeves County and Ended in Beverly Hills
Beware 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 partnership agreement said the law of California would govern disputes and a court in Beverly Hills would be the exclusive venue. The underlying asset, an oil and gas lease, was located in Reeves County, Texas. The dissatisfied partner, a Texan, understandably sought to litigate his breach of warranty, fraud and fraudulent misrepresentation claim in a Texas court. The district court and the appellate court took a look at the forum selection provision and dismissed the lawsuit, requiring the partner to pursue his claims in Bevely Hills.Continue Reading Jed Clampett Redux: The Dispute Began in Reeves County and Ended in Beverly Hills
The Burden of Due Diligence
What happens when the owner’s promise that it has conducted due diligence collides with the contractor’s fixed price obligation?
Continue Reading The Burden of Due Diligence