Standard Constructions, Inc. v. Chevron Chemical Company

CourtCourt of Appeals of Texas
DecidedFebruary 26, 2003
Docket01-00-01250-CV
StatusPublished

This text of Standard Constructions, Inc. v. Chevron Chemical Company (Standard Constructions, Inc. v. Chevron Chemical Company) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Standard Constructions, Inc. v. Chevron Chemical Company, (Tex. Ct. App. 2003).

Opinion

Opinion issued February 26, 2003






In The

Court of Appeals

For The

First District of Texas





NO. 01-00-01250-CV





STANDARD CONSTRUCTORS, INC., Appellant


V.


CHEVRON CHEMICAL COMPANY, INC., Appellee





On Appeal from the 125th District Court of

Harris County, Texas

Trial Court Cause No. 98-29650





O P I N I O N


          In this breach of contract action, appellant, Standard Constructors, Inc. (Standard), challenges a judgment entered after a jury verdict in favor of appellee, Chevron Chemical Company, Inc. (Chevron). In three issues, Standard contends that the trial court erred in (1) ruling, as a matter of law, that the contract unambiguously barred Standard’s claim for “equipment overtime charges,” (2) excluding relevant evidence, and (3) awarding Chevron interest and attorneys’ fees. We affirm.

Factual Background and Procedural History

          Standard, a construction company specializing in work at petrochemical plants, provided construction, maintenance, and repair services at Chevron’s Cedar Bayou refinery from the mid-1970s to 1997, when Chevron terminated its last contract with Standard. Standard had worked for Chevron under a series of one-year contracts, but, in December 1994, the parties entered into a three-year contract, which is the subject of this suit. Chevron entered into the three-year contract with Standard in order to lock in Standard’s rates for personnel and equipment.

          A few weeks before the new contract took effect, the refinery was severely damaged by a flood, and Standard was responsible for rebuilding approximately 33 buildings on an emergency basis. During the repairs, Chevron conducted a routine audit of Standard’s billing. The initial audit revealed that Standard had overcharged Chevron $97,784 for employee overtime. Standard admitted to overcharging Chevron and agreed to repay Chevron for its mistake. However, after completing the audit, Chevron claimed that Standard owed Chevron a total of $531,424, which included the $97,784 and, by letter dated December 18, 1996, Chevron demanded payment from Standard. Standard did not pay on Chevron’s demand, and Chevron terminated the contract.

          Standard subsequently sent Chevron a bill for $647,666, claiming that from April 1994 through March 1996 it failed to charge Chevron for “equipment overtime” and that under the three-year contract, Chevron was responsible for the these charges. Chevron refused to pay on Standard’s demand.

          Standard then sued Chevron for (1) the equipment overtime, (2) its lost profits from the premature termination of its exclusive contract, and (3) its attorneys’ fees. Chevron counterclaimed for breach of contract, demanding $97,784 as damages, and its attorneys’ fees.

          Before the trial began, the trial court held an evidentiary hearing on the issue of the contract’s ambiguity. The trial court ruled that the contract was unambiguous and barred Standard’s claim for equipment overtime charges. The remaining issues were tried to a jury. The jury determined that Standard did not have an exclusive contract and awarded Chevron $97,784 in overcharges and $80,000 in attorneys’ fees. The trial court then rendered judgment on the verdict and added prejudgment and post-judgment interest.

Contract Interpretation

          In its first issue, Standard contends that the trial court erred in ruling, as a matter of law, that the three-year contract unambiguously barred Standard’s claim for the previously unbilled equipment overtime.

          Whether a contract is ambiguous is a question of law for the court to decide. See Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd., 940 S.W.2d 587, 589 (Tex. 1996); see also Nat’l Union Fire Ins. Co. v. CBI Indus., Inc., 907 S.W.2d 517, 520 (Tex. 1995); Markert v. Williams, 874 S.W.2d 353, 356 (Tex. App.—Houston [1st Dist.] 1994, writ denied). We review questions of law de novo. See generally El Paso Natural Gas Co. v. Minco Oil & Gas, Inc., 8 S.W.3d 309, 312 (Tex. 1999); MCI Telecomm. Corp. v. Texas Util. Elec. Co., 995 S.W.2d 647, 651 (Tex. 1999); Tex. Private Employment Ass’n v. Lyn-Jay Int’l, Inc., 888 S.W.2d 529, 531 (Tex. App.—Houston [1st Dist.] 1994, no writ).

          The determination of whether a contract is ambiguous is made by looking at the agreement as a whole in light of the circumstances present when the parties entered into the contract. Nat’l Union, 907 S.W.2d at 520. We examine and consider the entire writing in an effort to harmonize and give effect to all the provisions of the contract so that none will be rendered meaningless. Id. No single provision will control; rather, all the provisions must be considered with reference to the whole instrument. Id.

          The primary concern of a court when construing a written contract is to ascertain the true intent of the parties as expressed in the instrument. Id. If a written contract is worded in a way that it can be given a definite or certain legal meaning, then it is not ambiguous. Id. A contract will only become ambiguous if its meaning is uncertain or it is subject to two or more reasonable interpretations. Id. An ambiguity does not arise simply because the parties advance conflicting interpretations of the contract. Forbau v. Aetna Life Ins. Co., 876 S.W.2d 132, 134 (Tex. 1994).

          Chevron contends that the trial court did not err in ruling that the contract unambiguously precluded Standard from charging overtime for equipment used during its construction and maintenance work.

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Standard Constructions, Inc. v. Chevron Chemical Company, Counsel Stack Legal Research, https://law.counselstack.com/opinion/standard-constructions-inc-v-chevron-chemical-comp-texapp-2003.