CG Ranch Services v. Schlumberger Technology Corporation

Court of Appeals of Texas·Decided April 30, 2024·No. 01-22-00720-CV·Published

Opinion

Opinion issued April 30, 2024

In The

Court of Appeals

For The

First District of Texas

argues that the trial court erred in granting Schlumberger’s motions for summary judgment and in sustaining Schlumberger’s objections to CG Ranch’s summary judgment evidence.

We affirm.

Background

CG Ranch and Schlumberger entered into an Agreement for Rental Equipment and Services, dated July 11, 2019, (“Agreement”), whereby Schlumberger would lease hunting equipment from CG Ranch. The Agreement consists of several parts that “shall be read as one document,” including the Form of Agreement and Exhibits A–I. The Agreement provides that it was to be “an umbrella agreement which sets the terms and conditions under which Schlumberger may . . . rent Units . . . from [CG Ranch] and/or purchase associated services.”

Under Exhibit A to the Agreement, the General Terms and Conditions for Rental Equipment and Services, Schlumberger was required to submit a purchase order describing the type, quantity, price, and required date of delivery of the rental equipment or products or the performance of services.

On August 1, 2019, Schlumberger and CG Ranch entered into a service order, under which Schlumberger leased various hunting equipment from CG Ranch for Schlumberger’s use on its King Ranch property for a 54-month term, beginning on

September 1, 2019. A month later, the parties amended the service order to, among other things, extend the lease period for an additional year, through March 31, 2024.1 By letter dated March 31, 2020, Schlumberger informed CG Ranch that it was terminating the Agreement pursuant to Article 9.1(f) of the Agreement:

Please allow this correspondence to serve as thirty days’ written notice of the cancellation of the Agreement pursuant to Section 9.1(f)

of the Agreement. Such cancellation shall become effective April 30, 2020. Pursuant to Section 9.2(b) of the Agreement, the Service Order shall terminate concurrently.

As per Section 9.5(b) Schlumberger shall pay rental on the equipment/units until the termination date. Additionally, Schlumberger will have the equipment listed in Exhibit 1 of the Service Order that is not currently in CG Ranch Services’ possession ready to be returned to CG Ranch Services on April 30, 2020. Please confirm receipt of this correspondence and advise of plans to retrieve the equipment.

CG Ranch sued Schlumberger, alleging that Schlumberger’s termination breached the Agreement. Schlumberger moved for traditional summary judgment on CG Ranch’s breach-of-contract claim, arguing that its termination was expressly authorized by the Agreement. CG Ranch filed a response and amended its petition to include a claim for fraud and a second breach-of-contract claim based on Schlumberger’s alleged misuse and abuse of the rental equipment. The trial court granted partial summary judgment in favor of Schlumberger on CG Ranch’s claim of breach of contract by termination.

1 We refer to the August 1, 2019 service order and its September 9, 2019 amendment collectively as the Amended Service Order.

The trial court entered a docket control order on CG Ranch’s new claims and set the deadline to designate expert witnesses for April 10, 2022. CG Ranch did not designate any experts.

Shortly before the close of discovery, Schlumberger moved for no evidence summary judgment on CG Ranch’s remaining breach of contract and fraud claims. In a separate motion filed the same day, Schlumberger also moved for traditional summary judgment on CG Ranch’s fraud claim.

CG Ranch filed a combined response to both summary judgment motions and attached as evidence the affidavit of Robert Woodcock. Schlumberger objected to the Woodcock affidavit, arguing that it was conclusory, and that CG Ranch failed to timely designate Woodcock as an expert. The trial court sustained Schlumberger’s objections to the Woodcock affidavit and granted Schlumberger’s no evidence and traditional motions for summary judgment. CG Ranch now appeals from the trial court’s final summary judgment.

Summary Judgment

In four issues, CG Ranch argues that the trial court erred in granting summary judgment in favor of Schlumberger on its breach of contract and fraud claims, and in sustaining Schlumberger’s objections to the Woodcock affidavit.

A. Standard of Review We review a trial court’s decision to grant a motion for summary judgment de novo. Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). Under the traditional summary judgment standard, the movant has the burden to show that no genuine issues of material fact exist and that it is entitled to judgment as a matter of law. TEX. R. CIV. P. 166a(c); Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548 (Tex. 1985). To determine whether there are disputed issues of material fact, we take as true all evidence favorable to the nonmovant and indulge every reasonable inference in the nonmovant’s favor. Nixon, 690 S.W.2d at 548–49.

To prevail on a no evidence motion for summary judgment, the movant must demonstrate that there is no evidence to support an essential element of the non- movant’s claim on which the nonmovant would have the burden of proof at trial. TEX. R. CIV. P. 166a(i); Hahn v. Love, 321 S.W.3d 517, 523–24 (Tex. App.— Houston [1st Dist.] 2009, pet. denied). The burden then shifts to the nonmovant to present some probative evidence raising a genuine issue of material fact as to each of the elements specified in the motion. Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 582 (Tex. 2006).

“The trial court must grant the [no evidence] motion unless the nonmovant produces more than a scintilla of evidence raising a genuine issue of material fact on the challenged elements.” Essex Crane Rental Corp. v. Carter, 371 S.W.3d 366, 376

(Tex. App.—Houston [1st Dist.] 2012, pet. denied). More than a scintilla of evidence exists if the evidence “rises to a level that would enable reasonable and fair-minded people to differ in their conclusions.” Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997). However, “when the evidence offered to prove a vital fact is so weak as to do no more than create a mere surmise or suspicion of its existence, the evidence is no more than a scintilla and, in legal effect, is no evidence.” Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 601 (Tex. 2004).

When, as here, the trial court’s summary judgment does not state the basis for the court’s decision, we must uphold the summary judgment if any of the theories advanced in the motion are meritorious. Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 216 (Tex. 2003).

When a party moves for both a traditional and no evidence summary judgment, we first review the trial court’s summary judgment under the no evidence standard of review. Ford Motor, 135 S.W.3d at 600. If the trial court properly granted the no evidence motion, we do not consider the arguments raised regarding the traditional summary-judgment motion. Id. B. Breach of Contract by Termination In its first issue, CG Ranch argues that the trial court erred in granting Schlumberger’s partial traditional motion for summary judgment on its claim for

breach of contract by termination.2 According to CG Ranch, the termination provisions in the Agreement and the Amended Service Order contain a latent ambiguity that create a fact issue and should have prevented the trial court from granting summary judgment as a matter of law.

1. Contract Interpretation Principles Absent ambiguity, contracts are construed as a matter of law. Moayedi v.

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