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Click here for the full text of this decision FACTS:Seagull Energy E&P Inc. (the operator) is the designated operator in operating agreements relating to two oil and gas leases of submerged lands on the Outer Continental Shelf off the coast of Texas. After the working-interest owners in these two leases entered into operating agreements regarding operations on each respective lease, Eland Energy Inc. acquired a working interest in both leases (collectively referred to as working interests). As part of the assignment of the working interests to Eland, Eland agreed to assume and be liable for a proportionate part of the obligations created by the existing offshore operating agreements pertaining to each interest. Less than two years after obtaining title to the working interests, Eland decided to have these interests sold at an auction that required no minimum bid. The assignee allegedly defaulted in its obligations under the operating agreements by failing to reimburse the operator for its share of the costs relating to the Working Interests. The assignee eventually filed for bankruptcy. After the assignee’s default, the operator demanded reimbursement from the assignor. While the assignor owned the working interests, it reimbursed the operator for its share of the operator-incurred costs; however, the assignor refused to reimburse the operator for costs incurred after it assigned the working interests to the assignee. The operator asserted breach-of-contract claims against the assignor and the assignee and sought reimbursement as to costs incurred after the assignor assigned the working Interests to the assignee. The trial court granted the operator’s motion for summary judgment and denied the assignor’s motion. After a bench trial on the remaining issues, the trial court signed a final judgment that incorporated the court’s prior summary-judgment rulings and that made the following additional rulings: 1. the assignor and the assignee are jointly and severally liable to the operator; and 2. based on the assignor’s cross-action against the assignee, the assignee must indemnify the assignor for all of the amounts awarded the operator against the assignor in the judgment. The trial court made findings of fact and conclusions of law stating, among others things, that the actual damages awarded the operator fairly and reasonably compensate the operator for the failure of the assignor and the assignee to comply with the operating agreements. HOLDING:The court reverses the part of the trial court’s judgment that awards damages against Eland, and renders judgment that Seagull take nothing against Eland. After reviewing the operating agreements, the court finds no provision that imposes any obligation on a former working-interest owner to pay or reimburse the operator for costs or expenses incurred after that owner has assigned all of its working interest to another party. The court concludes that although the assignor agreed to be bound by the operating agreements in question, the unambiguous language of these agreements does not require it to reimburse the operator for costs or expenses incurred after the assignor assigned the working interests to the assignee. Because the unambiguous language of the operating agreements does not create the contractual duty that the assignor allegedly breached, the assignor had no breach-of-contract liability to the operator as a matter of law. The trial court erred in finding it did and in granting summary judgment in favor of the operator. OPINION:Frost, J.; Fowler and Frost, JJ. (Brister, former C. J., not participating.)

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