Conway v. Saudi Arabian Oil Co.

• Decision Date: 04 August 1994
• Docket Number: Civ. A. No. C-93-149.
• Citation: 867 F. Supp. 539
• Parties: John CONWAY and Jeanne Conway, v. SAUDI ARABIAN OIL COMPANY and Aramco Services Co.
• Court: U.S. District Court — Southern District of Texas

867 F. Supp. 539

John CONWAY and Jeanne Conway, v. SAUDI ARABIAN OIL COMPANY and Aramco Services Co.

Civ. A. No. C-93-149.

United States District Court S.D. Texas, Corpus Christi Division.

August 4, 1994.

Wilson Calhoun, Meredith, Donnell & Abernethy, Corpus Christi, TX, for plaintiff.

Robert Ellison Meadows, Sewell & Riggs, Houston, TX, for defendant.

AMENDED ORDER ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

JACK, District Judge.

On this date, came on to be heard Defendants Saudi Arabian Oil Company "Saudi Arabian" and Aramco Services Company "Aramco" Motion for Summary Judgment and the Plaintiff's Response to Defendant's Motion for Summary Judgment.

I. JURISDICTION

This cause of action is in federal court as a result of a removal pursuant to 28 U.S.C. § 1441(d), § 1446, §§ 1602 et seq.

II. FACTS

Plaintiff, John Conway, entered into negotiations with Defendants. On or about June 3, 1991, John Conway accepted a conditional employment offer with Saudi Arabian made to him by their authorized agent Aramco. Plaintiffs allege that prior to acceptance Aramco recruiter, Dottie Hunter, indicated to them that John Conway would be assigned to Ras-Tanura. Plaintiffs desired this site because it is located on the water and would enable them to enjoy various watersports. In addition to the offer letter, John Conway had to sign SAUDI ARAMCO Terms and Conditions of Employment "the agreement". Aramco also gave them a compensation worksheet that estimated expenses for the listed site of Ras-Tanura.

Plaintiffs argue that they relied on Defendants promise that they would be located in Ras-Tanura. Based on this reliance, they took several steps which they maintain have left them severely disadvantaged. They sold their car and boat below market value, they prepared their house for leasing, Jeanne Conway quit her job, John Conway turned down an offer for another job and they made several purchases as well as taking other measures in preparation for their life in Saudi Arabia.

While Plaintiffs made such preparations, Defendants informed them they would be assigned to Abqaiq. Plaintiffs maintain that although they greatly preferred Ras-Tanura, John Conway would accept assignment at Abqaiq since it was also on the water. By mid-August of 1991, Plaintiffs had substantially met all of the conditions in the offer letter and agreement. Plaintiffs planned to leave for Saudi Arabia at the end of August. On August 13, 1991, Defendants informed John Conway that his location had been changed from Abqaiq to Udhailayah. (Defs.' Mot. for Summ.J.Ex. A-8). Plaintiffs objected to this location as very remote with none of the services and amenities that either Ras-Tanura or Abqaiq had to offer. When Defendants did not reconsider the assignment site, John Conway withdrew from taking substantive steps towards moving to Saudi Arabia to work for Defendants. (Defs.' Mot. for Summ.J.Ex. A-9). Eventually, the contract was terminated when John Conway refused to work for Saudi Arabian in Udhailayah. (Defs.' Mot. for Summ.J.Ex. A-10).

III. CAUSES OF ACTION

In a motion for summary judgment, the moving party has the burden to establish that there is "no genuine issue of material fact and that the moving party is entitled to judgement as a matter of law." Fontenot v. Upjohn Co., 780 F.2d 1190, 1195 (5th Cir. 1986). The Court must view all inferences from the evidence in the light most favorable to the non-movant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 2513, 91 L.Ed.2d 202 (1986). Thus, "there is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Id. at 249, 106 S.Ct. at 2511.

(1) Breach of Contract. The Fifth Circuit has established that the "interpretation of a contract is a question of law." Calpetco 1981 v. Marshall Exploration, Inc., 989 F.2d 1408, 1413 (5th Cir.1993); D.E.W., Inc. v. Local 93, Laborers' Int'l Union of N. Am., 957 F.2d 196, 199 (5th Cir.1992); Kimbell Foods, Inc. v. Republic Nat'l Bank, 557 F.2d 491 (5th Cir.1977). When a contract is unambiguous, the court must give legal effect to parties' expressed intentions. Ideal Lease Service, Inc. v. Amoco Prod. Co., Inc., 662 S.W.2d 951, 953 (Tex.1983); Sun Oil Co. (Delaware) v. Madeley, 626 S.W.2d 726, 727-28 (Tex.1981). Furthermore, mere disagreement about contract terms and obligations between the parties establishes neither ambiguity regarding the contract nor a question of fact for the jury. D.E.W., Inc., 957 F.2d at 199.

On or about May 15, 1991, D.J. Hunter sent a letter to John Conway offering him a position with Saudi Arabian Oil. (Defs.' Mot. for Summ.J.Ex. A-1). This letter clearly stated that it was a conditional offer by Defendants to Plaintiff. The offer of employment was with the company generally and did not specify a particular location. Moreover, the letter even indicated that assignment outside of Saudi Arabia was a possibility. Plaintiff had a number of conditions he had to meet before he could assert rights under the contract. At the bottom of the letter, Plaintiff accepted the offer without attempting to make any changes or additions to the terms. Therefore, his acceptance required that he meet the stated conditions in their entirety to establish a binding contract. For the purpose of this motion, we assume that Plaintiffs had successfully completed or were on their way to completing the conditions in the offer letter. When negotiations are in writing, the existence of a valid acceptance is a question of law for the court to determine. Gilbert v. Pettiette, 838 S.W.2d 890, 893 (Tex.Ct.App.—Houston 1992); Associated Tabulating Serv. Inc. v. Olympic Life Ins. Co., 414 F.2d 1306 (5th Cir.1969).

In addition to the terms in the offer, he also was required to return the agreement after reading and agreeing to these additional terms. (Defs.' Mot. for Summ.J.Ex. A-3). When a "set of documents executed at the same time, with the same purpose and in the course of the same transaction, courts should construe the agreements together." Calpetco 1981, 989 F.2d at 1412; Jim Walter Homes, Inc. v. Schuenemann, 668 S.W.2d 324, 327 (Tex.1984); Jones v. Kelley, 614 S.W.2d 95, 98 (Tex.1981). This document, therefore, became incorporated into the contract between the two parties. The agreement indicates that Plaintiff was an "at will" employee. Even Plaintiffs acknowledge that they had an "at will" employment contract. (Resp. to Defs.' Mot. for Summ.J. ¶ 27). Moreover, the agreement states that "any such change, representation or agreement altering these terms and conditions of employment must be in writing and signed by" either the company president, the chief executive officer or a vice president. (Defs.' Mot. for Summ.J.Ex. A-3 ¶ 7). Plaintiffs offer no written evidence regarding the assignment of a specific location by one of these required officers.

Plaintiffs further argue that the compensation worksheet indicated that they would be assigned to Ras-Tanura. (Pls.' Mot. for Summ.J.Ex. 2). The offer letter discusses the purpose of this estimated compensation worksheet as "to provide an estimate of the net monthly compensation you will receive with SAUDI ARAMCO in Saudi Arabia." (Defs.' Mot. for Summ.J.Ex. A-1 at 1) (emphasis in original). Defendants gave Plaintiffs this worksheet in order to indicate the average monthly expenses and compensation and is not determinative of the site where Plaintiffs would be assigned. The Supreme Court long ago established that "a reference by the contracting parties to an extraneous writing for a particular purpose makes it a part of their agreement only for the purpose specified." Guerini Stone Co. v. P.J. Carlin Constr. Co., 240 U.S. 264, 277, 36 S.Ct. 300, 306, 60 L.Ed. 636 (1916); Ralston Purina Co. v. Barge Juneau & Gulf Caribbean Marine Lines, Inc., 619 F.2d 374, 375 (5th Cir. 1980). Thus, the worksheet is only effective insofar as it establishes an estimation of living expenses that Plaintiffs could expect while working in the Middle East. Ralston Purina, 619 F.2d at 375-76; Hill & Combs v. First Nat'l Bank of San Angelo, Texas, 139 F.2d 740, 742 (5th Cir.1944). The argument that the worksheet is dispositive of the exact location assignment is unpersuasive since in the next sentence of the offer letter, Defendants indicate that assignment could be outside of Saudi Arabia.

Furthermore, Plaintiffs argue that Defendants and their agents implied and stated orally that they would be stationed at Ras-Tanura. "Where the meaning of the contract is plain and unambiguous, a party's construction is immaterial." Sun Oil, 626 S.W.2d at 732. Moreover, the agreement signed by John Conway specifically precluded any written or oral alterations so that the agreement and the offer letter "constituted the sole agreement between Conway and the Company relating to his employment." (Defs.' Mot. for Summ.J.Ex. A-3 ¶ 9). Lastly, Texas law disfavors oral agreements altering the rights of parties to a written employment contract. McCamy v. Gen. Elec. Supply Corp., 185 F.2d 944 (5th Cir.1950); Rayburn v. Equitable Life Assurance Soc'y Of The United States, 805 F.Supp. 1401, 1407 (S.D.Tex.1992). See also Harville Rose Serv. v. Kellogg Co., 448 F.2d 1346 (5th Cir.1971), cert. denied, 405 U.S. 987, 92 S.Ct. 1248, 31 L.Ed.2d 453 (1972). Oral evidence under the parole evidence rule is only admissible to clarify parties' intentions when the writing is ambiguous. McDaniel v. California-Western States Life Ins. Co., 181 F.2d 606 (5th Cir.1950); Humble Oil & Refining Co. v. Mullican, 144 Tex. 609, 192 S.W.2d 770 (1946). Since the written documents are not ambiguous, Plaintiffs' oral evidence is inadmissible.

As far as damages incurred by Jeanne Conway, she has no privity of contract with Defendants. "Privity of contract is an essential element of recovery in an action based on contractual theory." Republic Nat'l Bank v. Nat'l Bankers Life Ins. Co., 427 S.W.2d...