MMR Int'l Ltd. v. Waller Marine, Inc.
| Decision Date | 24 July 2013 |
| Docket Number | CIVIL ACTION H-11-1188 |
| Parties | MMR INTERNATIONAL LIMITED, Plaintiff, v. WALLER MARINE, INC., Defendant. |
| Court | U.S. District Court — Southern District of Texas |
Pending before the court are Defendant Waller Marine, Inc.'s motions for partial summary judgment as to plaintiff's claims for breach of contract in excess of not-to-exceed price and tortious interference. After considering the motions, responses thereto, replies, and the applicable law, the court finds that the motion related to the breach of contract claim (Dkt. 36) should be DENIED and the motion related to the tortious interference claims (Dkt. 37) should be GRANTED.
In September 2010,Waller and MMR executed a purchase order requiring MMR to mobilize and manage the equipment and the local Venezuelan labor force necessary to complete electrical and instrumentation work on two power barges Waller was constructing in Venezuela for Citgo. Dkt. 46, Ex. 1. The purchase order reflected a "not to exceed" price of $443,468.80. Id.
While MMR accepted the "not-to-exceed" price in the purchase order, MMR contends the scope of the project drastically changed after its inception, requiring MMR to increase its projected cost to complete the job. Dkt. 46, Ex. 2, pp. 31-32. On October 15, 2010, MMR notified Waller via email that it was projected to significantly exceed the "not-to-exceed" price due to the additional labor and work required by Waller. Dkt. 46, Ex. 11. The email included a pro forma invoice andspreadsheet itemizing the labor and supplies expected for the job by MMR for the month of October. Id.
MMR alleges that this request was accepted by Waller. Specifically, Mike Hammonds, Waller's contract administrator, orally responded to MMR's request by allegedly informing John Courville, MMR's Vice President, that the requested amendment was "no problem." Dkt. 36, Ex. 1. Hammonds allegedly stated he preferred to issue only one amended purchase order, so he would wait to issue such purchase order when the final invoice amount was known. Id. On this basis, MMR claims the contractual "not-to-exceed" price was orally modified. MMR ultimately invoiced Waller for approximately $954,837.62 for work it performed through November 14, 2010. Dkt. 2, Exs. 2 & 3. Waller has not paid the invoices. Dkt. 1, pp. 3-4.
Further, soon after work began in Venezuela, disputes arose between the parties. Waller claims MMR's workforce continually presented problems on the job site in terms of strikes, thefts, threats of bodily harm and poor work ethic. Dkt. 52, Ex. 2, pp. 51-52. For these reasons, Waller alleges it terminated the contract on November 8, 2010, before MMR completed the full scope of work on the barges. Dkt. 50, Ex. 10. MMR, however, claims that Waller unjustifiably terminated MMR for improper reasons. Dkt. 50, Ex. 7, pp. 234-38. Specifically, MMR claims that Waller, Alba Energia (Waller's Venezuelan partner), and Edibarca (a local labor service subcontractor) colluded to terminate MMR, so that Edibarca could hire MMR's labor force and charge Waller less for the same labor. Id.
MMR sued Waller for breach of contract for failing to pay the outstanding invoices and for tortious interference of the existing contract and prospective business relations. Waller counterclaimed for breach of contract and negligent hiring, supervision, training and retention of itslabor force. Before the court are Waller's motions for partial summary judgment on MMR's claims for breach of contract and tortious interference. The court will address each in turn.
Summary judgment is proper if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED. R. CIV. P. 56(c); see also Carrizales v. State Farm Lloyds, 518 F.3d 343, 345 (5th Cir. 2008). The mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; there must be an absence of any genuine issue of material fact. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S. Ct. 2505 (1986). An issue is "material" if its resolution could affect the outcome of the action. Burrell v. Dr. Pepper/Seven Up Bottling Group, Inc., 482 F.3d 408, 411 (5th Cir. 2007). "[A]nd a fact is genuinely in dispute only if a reasonable jury could return a verdict for the non-moving party." Fordoche, Inc. v. Texaco, Inc., 463 F.3d 388, 392 (5th Cir. 2006).
The moving party bears the initial burden of informing the court of all evidence demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548 (1986). Only when the moving party has discharged this initial burden does the burden shift to the non-moving party to demonstrate that there is a genuine issue of material fact. Id. at 322. If the moving party fails to meet this burden, then it is not entitled to a summary judgment, and no defense to the motion is required. Id. "For any matter on which the non-movant would bear the burden of proof at trial . . . , the movant may merely point to the absence of evidence and thereby shift to the non-movant the burden of demonstrating by competent summary judgment proof that there is an issue of material fact warranting trial." Transamerica Ins. Co. v. Avenell, 66F.3d 715, 718-19 (5th Cir. 1995); see also Celotex, 477 U.S. at 323-25. To prevent summary judgment, "the non-moving party must come forward with 'specific facts showing that there is a genuine issue for trial.'" Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S. Ct. 1348 (1986) (quoting FED. R. CIV. P. 56(e)).
When considering a motion for summary judgment, the court must view the evidence in the light most favorable to the non-movant and draw all justifiable inferences in favor of the non-movant. Envtl. Conservation Org. v. City of Dallas, Tex., 529 F.3d 519, 524 (5th Cir. 2008). The court must review all of the evidence in the record, but make no credibility determinations or weigh any evidence; disregard all evidence favorable to the moving party that the jury is not required to believe; and give credence to the evidence favoring the non-moving party as well as to the evidence supporting the moving party that is uncontradicted and unimpeached. Moore v. Willis Ind. Sch. Dist., 233 F.3d 871, 874 (5th Cir. 2000). However, the non-movant cannot avoid summary judgment simply by presenting "conclusory allegations and denials, speculation, improbable inferences, unsubstantiated assertions, and legalistic argumentation." TIG Ins. Co. v. Sedgwick James of Wash., 276 F.3d 754, 759 (5th Cir. 2002); Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc). By the same token, the moving party will not meet its burden of proof based on conclusory "bald assertions of ultimate facts." Gossett v. Du-Ra-Kel Corp., 569 F.2d 869, 872 (5th Cir. 1978); see also Galindo v. Precision Amer. Corp., 754 F.2d 1212, 1221 (5th Cir. 1985).
Waller maintains that MMR cannot raise an issue of fact with regard to Waller's obligation to pay an amount above the $443,468.80 "not-to-exceed" price. Waller, thus, asks this court to rule as a matter of law that the "not-to-exceed" price caps the damages recoverable by MMR. MMRcontends that Waller supplied the price term without providing a proper work of scope and agreed to modify the price term when Waller was notified of the expected overage.
The court does not dispute the clarity of the not-to-exceed price term, but finds a fact issue exists with respect to whether the price term was ultimately orally modified. In construing a contract, the principal objective is to ascertain the true intentions of the parties as expressed in their agreement. Enserch Corp. v. Rebich, 925 S.W.2d 75, 80 ().1 Whether a contract is ambiguous is a question of law for the court to decide. Id. A contract is not ambiguous if it is worded so that the court may give it a certain or definite legal interpretation. Id. An agreement to render a performance at a price that shall not exceed a specified amount is valid as an agreement to render the performance at the stated maximum. Norton v. Menard Lumber Co., 523 S.W.2d 791, 793 (Tex. Civ. App.-San Antonio 1975, no writ). Generally, plaintiff should not be able to recover any amount in excess of the agreed to maximum price. Id.
The purchase order executed between the parties clearly states that the "Total Purchase Order: Not to Exceed" price is $443,468.80. Dkt. 46, Ex. 1; see also Dkt. 36, Ex. 1, p. 26 (). The purchase order is executed on behalf of both parties, evidencing MMR's agreement to this term. Dkt. 46, Ex. 1. As to the price term agreed to by Waller and MMR, the court finds no factual dispute that as of September 23, 2010, MMR was to "assist in the Electrical Completion of the WMI Power Barges in Venezuela" and "mobilize a crew as directed by WMI to the Venezuelan site" for $443,468.80. Id.
However, parties are free to modify a contract by any manner in which they can make a contract. Hondo Oil & Gas Co. v. Texas Crude Operator, Inc., 970 F.2d 1433, 1437 (5th Cir. 1992)(applying Texas law). Whether the parties modified the contract depends on the parties' intentions and is a question of fact. Id. (citing Hathaway v. General Mills, Inc., 711 S.W.2d 227, 228-29 (Tex. 1986)). A contract modification must satisfy the traditional requirements of a contract, namely there must be a meeting of the minds supported by consideration. Arthur J. Gallagher & Co. v. Dieterich, 270 S.W.3d 695, 702 (Tex. App.-Dallas 2008, no pet.). In...
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