Edwards v. Lone Star Gas Co., Div. of Enserch Corp.

Opinion

 [*840]  At issue is the proper price to be paid under two gas purchase contracts. H. S. "Gus" Edwards, the gas producer, sued Lone Star Gas Company, the pipeline, alleging that Lone Star had breached the contracts by failing to pay monthly price escalations as part of a redetermined contract price and by failing to reimburse Edwards for state severance taxes. The trial court granted summary judgment in favor of Edwards for damages in the amount of the monthly price escalations but denied Edwards any reimbursement for severance taxes. The court of appeals reversed the trial court's judgment and rendered a take-nothing judgment [**2]  against Edwards. 769 S.W.2d 568. We reverse the judgment of the court of appeals and affirm that of the trial court.

The price redetermination provisions of each contract are identical and read, in pertinent part, as follows:

Seller may request a redetermination of the price payable hereunder by Seller giving Buyer written notice of Seller's desire for a price redetermination not less than sixty (60) days immediately preceding the end of (i) the first six (6) months after the date of first delivery and (ii) annually thereafter during the term of this Contract. It is agreed that the redetermined price per MMBtu for such gas shall be equal to the highest price  [*841]  per MMBtu to be paid as of the first day of the period for which the redetermined price will be effective by a bona fide intrastate pipeline company for gas produced in Railroad Commission Districts 8 and 8A in the State of Texas under the terms of a contract of at least three (3) year term in effect at the time the redetermined price is to become effective . . . . (emphasis added)

We conclude that this contractual provision is unambiguous, and ] the construction of an unambiguous contract [**3]  presents a question of law for the court. Coker v. Coker, 650 S.W.2d 391, 393 (Tex. 1983).

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