Samson Expl., LLC v. Hooks

• Court: Texas Court of Appeals
• Writing for the Court: CHARLES KREGER Justice
• Decision Date: 17 September 2020
• Docket Number: NO. 09-18-00390-CV,09-18-00390-CV
• Citation: Samson Expl., LLC v. Hooks, NO. 09-18-00390-CV (Tex. App. Sep 17, 2020)
• Parties: SAMSON EXPLORATION, LLC, Appellant v. CHARLES G. HOOKS III, ET AL, Appellees

SAMSON EXPLORATION, LLC, Appellant v. CHARLES G. HOOKS III, ET AL, Appellees

NO. 09-18-00390-CV

Court of Appeals Ninth District of Texas at Beaumont

Submitted on June 6, 2019

September 17, 2020

On Appeal from the 60th District Court Jefferson County, Texas

Trial Cause No. B-173,008-B

MEMORANDUM OPINION

We are asked to determine, among other issues, what constitutes an unconditional tender of payment sufficient to stop the accrual of post-judgment interest. Samson Exploration, LLC, previously known as Samson Lone Star, LP, (Samson) appeals the trial court's denial of its motion for satisfaction of judgment concerning post-judgment interest owed by Samson and granting of the Hooks's motion to maintain Samson's supersedeas bond until full payment of final judgment. Samson argues that the trial court erred when it denied Samson's motion forsatisfaction of judgment and ordered Samson to pay an additional $3,434,279.00 in post-judgment interest because the trial court did not properly apply the Finance Code in calculating the accrual of post-judgment interest as it relates to appellate extensions, and erred in failing to consider partial payments by Samson as unconditional tenders, thereby arresting the accrual of post-judgment interest on the judgment amount after crediting each partial payment at the time they are tendered against the remaining balance owed. For the reasons explained below, we affirm the trial court's judgment in part and reverse and remand in part.

Procedural History¹

Appellees, Charles E. Hooks III, et al, (Hooks) sued Samson for violations, including breach of contract and fraud, of a mineral lease of land owned by Hooks and leased by Samson. A jury found that Samson violated the terms of the lease, among other issues, and awarded Hooks a judgment that "exceeded $22 million dollars." The judgment of the trial court contained the following provision:

IT IS FURTHER ORDERED, ADJUDICATED, AND DECREED that, in addition to the foregoing, Plaintiffs shall have and recover from Samson post-judgment interest on the total amount of this judgment, including damages, attorneys' fees, expert witness fees, and costs of court, at the rate of 18%, compounded annually.

Samson appealed the jury's verdict, and the First Court of Appeals affirmed in part and reversed and rendered in part the trial court's judgment. Samson Lone Star, Ltd. P'ship v. Hooks, 389 S.W.3d 409, 440 (Tex. App.—Houston [1st Dist.] 2012), aff'd in part, rev'd in part 457 S.W.3d 52 (Tex. 2015). The appellate court affirmed only the trial court's judgment award of $52,257.22 to Hooks related to Samson's failure to pay ad valorem taxes and modified the post-judgment interest to 5%. Id. The court reversed "the remaining portions of the final judgment." Id. Samson paid to Hooks the $52,257.22 plus accrued interest at 5%, totaling $62,025.47. Hooks refused the payment. According to Samson, this amount was "stipulated by the parties." The payment reflected the following language:

Samson has previously tendered this payment directly to Plaintiffs and Plaintiffs' counsel, but Samson's tenders have been refused. Samson will cooperate with a motion by Plaintiffs to withdraw, for Plaintiffs, this sum from the Court's Registry, and with any motion Plaintiffs may make to have this sum placed in an interest-bearing account.

Samson deposited the money into the registry of the trial court.

Hooks then appealed to the Texas Supreme Court. See Hooks v. Samson Lone Star, Ltd. P'ship, 457 S.W.3d 52 (Tex. 2015). The Supreme Court reversed the court of appeals on the issues of limitations for fraud, the most-favored-nations clause,limitations for breach of offset provisions, and attorneys' fees. See id. at 70. It also affirmed in part and reversed in part post-judgment interest, holding that "to the extent Hooks recovers for past due royalties, he is entitled to an 18% interest rate[,]" and a 5% post-judgment interest rate on all other recoveries. Id. at 69-70. On remand, the First Court of Appeals modified the trial court's judgment regarding unpooling damages, fraud damages representing the formation-production damages, the most-favored-nations damages and post-judgment interest rate, stating the post-judgment interest rate will accrue at "an 18% rate for past-due royalties . . . and a 5% interest rate for other recoveries." Samson Lone Star Ltd. P'ship v. Hooks, 497 S.W.3d 1, 34-35 (Tex. App.—Houston [1st Dist.] 2016, pet. denied) (Supp. Op.).

Samson thereafter paid the sum of $1,793,314.89 to Hooks based on its calculation of "final portions of the judgment plus post-judgment interest[,]" that Samson believed the Texas Supreme Court mandate made final. When Hooks refused the payment, Samson filed a motion with the trial court requesting the payment amount be deposited into the registry of the court. The following language accompanied Samson's payment:

Samson has previously tendered this payment directly to Plaintiffs and Plaintiffs' counsel, but Samson's tenders have been refused. Samson will cooperate with a motion by Plaintiffs to withdraw . . . this sum from the Court's Registry, and with any motion Plaintiffs may make to have this sum placed in an interest-bearing account.

The trial court granted Samson's motion in part and ordered the amount deposited with the district clerk be applied toward "satisfaction of those claims made final by the January 30, 2015 Opinion and May 1, 2015 Mandate of the Texas Supreme Court[.]"

Simultaneously with its partial payment to Hooks, Samson appealed to the Texas Supreme Court. The Supreme Court denied Samson's petition for review. Samson Lone Star, Ltd. P'ship v. Hooks, 16-0776, 2018 Tex. LEXIS 80, *1 (Tex. Jan. 26, 2018). Samson then attempted to make a final payment to Hooks reflecting the "total unpaid portion of the judgment of $25,416,097.73." Samson offered this amount to Hooks as payment for the full judgment and represented to Hooks it would "forego" a petition for rehearing to the Texas Supreme Court if Hooks accepted the amount as payment in full for the judgment. Samson argues that this was not a "voluntary payment" to Hooks because, Samson included language tracking the Texas Supreme Court in Miga I and Miga II. See Miga v. Jensen, 96 S.W.3d 207 (Tex. 2002) (Miga I); see also Miga v. Jensen, 299 S.W.3d 98 (Tex. 2009) (Miga II).

Samson explicitly reserves, and does not waive, its rights to (a) challenge the judgment giving rise to the Remaining Final Judgment Amount, both in the Texas Supreme Court and in any other courts to which the case might be remanded; and (b) if the challenge is successful, recover the Remaining Final Judgment Amount plus interest from Plaintiffs and their attorneys representing them. Accordingly, any overpayment is not a "voluntary" payment but rathershould be returned to Samson or applied to any amounts owed for any claims under this case. (citations omitted.)

Hooks refused the attempted payment but did not object to the amount being deposited into the registry of the court. Samson again included the following language with its deposit into the court's registry.

Samson has previously tendered this payment directly to Plaintiffs and Plaintiffs' counsel by the letter dated February 12, 2018, . . . but Plaintiffs have not accepted that tender. Samson will cooperate with a motion by Plaintiffs to withdraw, for Plaintiffs, this sum from the Court's registry, and with any motion Plaintiffs may make to have this sum placed in an interest-bearing account.

The Texas Supreme Court denied Samson's motion for rehearing. Samson Lone Star, Ltd. P'ship v. Hooks, 16-0776, 2018 Tex. LEXIS 460, *1 (Tex. June 1, 2018). Thereafter, Hooks and Samson submitted an agreed order requesting that the trial court release to Hooks all sums deposited by Samson from the registry of the court. The money was released to Hooks.

Subsequently, Samson filed a Motion for Entry of Satisfaction of Judgment. Hooks opposed Samson's motion and requested the court maintain Samson's supersedeas bond until Samson paid the judgment in full. Hooks asserted that Samson still owed Hooks money on the judgment, and Samson sought a court order "acknowledging that Samson has paid all amounts due and owing by virtue of the judgment of this case." The trial court denied Samson's motion and ordered thatSamson pay an additional $3,434,279.00 to Hooks, "plus subsequent post-judgment interest[.]" Samson timely filed this appeal.

Accrual of Post-judgment Interest

In its first issue, Samson argues that the trial court erred by failing to properly apply the Finance Code when calculating post-judgment interest. See Tex. Fin. Code Ann. § 304.005. According to Samson, the post-judgment interest should not have accrued during times of Hooks' appellate extensions and therefore, the trial court's judgment is in direct violation of section 304.005(b) of the Finance Code. See id. Samson contends that "post-judgment interest statutes operate on judgments even when the judgments do not reference those statutes."

The assessment of when post-judgment interest begins to accrue is a matter of statutory interpretation, subject to de novo review. Long v. Castle Tex. Prod. LP., 426 S.W.3d 73, 78 (Tex. 2014). "Our fundamental goal when reading statutes 'is to ascertain and give effect to the Legislature's intent."' Cadena Comercial USA Corp. v. Tex. Alcoholic Bev. Comm'n, 518 S.W.3d 318, 325 (Tex. 2017) (quoting Tex. Mut. Ins. Co. v. Ruttiger, 381 S.W.3d 430, 452 (Tex. 2012)). "To do this, we look to and rely on the plain meaning of a statute's words as expressing legislative intent unless a different meaning is supplied, is apparent from the context, or the plain meaning of the words leads to absurd or nonsensical results." Id. (citation omitted). Section 304.005 states the following regarding post-judgment interest accrual:

a) Except as provided by Subsection (b), post-judgment interest on a money judgment of a court in this state accrues during the period beginning on the

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