J-A04028-14


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

XTO ENERGY, INC.                            IN THE SUPERIOR COURT OF
                                                  PENNSYLVANIA
                v.

DOMINION FIELD SERVICES, INC.,
EQUITRANS, LP, EQT ENERGY, LLC, AND
EQT CORPORATION

                v.

LINN ENERGY, LLC, F/K/A, LINN ENERGY
HOLDINGS, LLC AND LINN OPERATION,
INC.

APPEAL OF: DOMINION FIELD
                                                No. 837 WDA 2013
SERVICES, INC.


          Appeal from the Judgment Entered on April 18, 2013,
           In the Court of Common Pleas of Allegheny County
                   Civil Division at No.: GD-10-004393


XTO ENERGY, INC.                            IN THE SUPERIOR COURT OF
                                                  PENNSYLVANIA
                     APPELLANT



                     v.

DOMINION FIELD SERVICES, INC.,
EQUITRANS, LP, EQT ENERGY, LLC AND
EQT CORPORATION

                      v.

LINN ENERGY, LLC F/K/A LINN ENERGY
HOLDINGS, LLC, AND LINN OPERATION,
INC.                                            No. 885 WDA 2013
J-A04028-14


             Appeal from the Judgment Entered on April 18, 2013,
              In the Court of Common Pleas of Allegheny County
                      Civil Division at No.: GD-10-004393


XTO ENERGY, INC.                                 IN THE SUPERIOR COURT OF
                                                       PENNSYLVANIA
                           v.

DOMINION FIELD SERVICES, INC.,
EQUITRANS, LP, EQT ENERGY, LLC, AND
EQT CORPORATION

                            v.

LINN ENERGY, LLC, F/K/A, LINN ENERGY
HOLDINGS, LLC AND LINN OPERATION,
INC.



APPEAL OF: EQUITRANS, LP, EQT
ENERGY, LLC, AND EQT CORPORATION
                                                     No. 890 WDA 2013


             Appeal from the Judgment Entered on April 18, 2013,
              In the Court of Common Pleas of Allegheny County
                      Civil Division at No.: GD 10-004393


BEFORE: BOWES, J., WECHT, J., and STABILE, J.

MEMORANDUM BY WECHT, J.:                          FILED OCTOBER 22, 2014

       This matter comes before this Court on the parties’ respective appeals

of various summary judgment rulings entered by the trial court.1       Those
____________________________________________


1
      The parties address the appeal and cross-appeals to various orders.
However, under these circumstances, the respective appeals lie only from
the trial court’s April 18, 2013 entry of final judgment in this matter.
See generally Johnston the Florist, Inc. v. TEDCO Constr. Corp.,
(Footnote Continued Next Page)


                                           -2-
J-A04028-14



orders conclusively resolved a number of claims and cross-claims arising

from a dispute involving the sale of natural gas that was occasioned by an

error made by an employee of an intermediary to the transaction. We affirm

the trial court’s final judgment.

      The factual history underlying this case is complicated, and involves

esoteric aspects of how natural gas is traded. The trial court provided the

following apt summary of the commercial context in which this dispute

arose, as well as a summary of the events and relationships that led to the

claims sub judice, the content of which is not substantially disputed by the

parties.

      XTO Energy, Inc. [“XTO”] has filed a complaint raising a single
      count (breach of contract) against Dominion Field Services, Inc.
      [“DFS”]. . . .1
           1
               I am bifurcating the remaining claims raised in this
           litigation.

      The breach of contract claim arises out of writings between XTO
      and DFS for the sale of natural gas for the seven-month period
      between April 1, 2008 and October 31, 2008.2
           2
              The writings governing the period through June 30,
           2008 were executed by [the Linn Energy parties]. On July
           1, 2008, XTO succeeded to [the interest of the Linn Energy
                       _______________________
(Footnote Continued)

657 A.2d 511, 514 (Pa. Super. 1995) (“Because the entry of judgment was
considered to be a prerequisite to the exercise of this Court’s jurisdiction, it
was long this Court’s policy to quash an appeal from an order upon which
judgment had not been entered.”). Nonetheless, all appeals filed in this
matter were timely relative to the April 18, 2013 entry of judgment and the
rules governing the timing of cross-appeals. See Pa.R.A.P. 511, 903(b).
Consequently, our jurisdiction over the instant appeals is not in question.




                                            -3-
J-A04028-14


          parties (“Linn”)2] in these contracts. Additional writings
          executed by XTO govern the period from August 1, 2008
          through October 31, 2008.

       A gas contract between XTO and DFS is comprised of two
       documents. The first is titled “Master Gas Contract General
       Terms and Conditions[” (“the Contract”);] it sets forth common
       terms that govern all purchase transactions.         The second
       document, known as a “Natural Gas Purchase Confirmation,” is
       specific to each particular purchase; each Confirmation specifies
       the time period, quantity, price, meters, receiving pipeline, and
       any special conditions.

       The contracts between XTO and DFS for the sale of gas provide
       for delivery through the use of a gathering system operated by
       Equitrans[, LP]. At DFS’s request, Equitrans designates specific
       meters [“the Meters”] that may be used only for XTO’s deliveries
       to DFS. The gas passing through [the Meters] goes into a
       gathering system that gathers gas on behalf of numerous
       buyers, with each meter serving only a single buyer.

       Each meter measures the amount of gas leaving the meter and
       going into the gathering system. Equitrans is to credit DFS with
       the amount of gas shown on [the Meters]. At the end of each
       month, Equitrans is to furnish DFS a Production Statement
       showing, for the entire month, the amount of gas credited to
       DFS from each meter. DFS calculates payments owed to XTO
       based on the monthly totals shown on the Production Statement.

       There are instances in which Equitrans, based on information
       furnished by parties using the Equitrans gathering system, will
       switch the credits from one party to another. This would occur,
       for example, if there was a writing signed by DFS, XTO, and EQT
       Energy, LLC and delivered to Equitrans, stating that all gas
       coming into [the Meters] should be credited to EQT Energy,
       rather than to DFS. In this case, there is no such writing.
____________________________________________


2
      Linn is a cross-defendant to this action as the predecessor in interest
to the contracts at issue, which later were acquired in full by XTO,
retroactively to a date preceding the events underlying the instant litigation.
For simplicity’s sake, we have replaced the trial court’s usage of “Linn/XTO”
with “XTO,” except where it is necessary to distinguish between those
parties.



                                           -4-
J-A04028-14


     In April 2008, gas furnished by XTO began to flow through [the
     Meters] and into Equitrans’ [p]ipeline. Equitrans gave credit to
     DFS for the gas [that] XTO delivered to the [M]eters in April,
     May, and June.         DFS, in turn, paid XTO approximately
     $1.5 million for this gas.

     In accordance with the parties’ agreement, payments are made
     on an approximate two-month lag. Payment for the April sales
     is made in late June, payment for the May sales is made in late
     July, and the payment for the June sales is made in late August.3
        3
           Linn made the April, May, and June deliveries. From
        July through October 2008, XTO delivered the gas to the
        [M]eters.

     This litigation would not have occurred but for (1) mistakes
     made by Leslie Crider—an Equitrans employee—and (2) a sharp
     decline in the price of gas.

     In late August 2008, Ms. Crider was looking at DFS’s pool on
     Equitrans’ invoices for April, May, and June.            Ms. Crider
     remembered that some time ago there had been conversations
     between Steve Rafferty, Senior Vice President of EQT . . . and
     Curt Tipton, then a Vice President of Linn, involving Linn’s sale to
     EQT Energy of the gas [that] XTO delivered in April, May, and
     June.4 She testified that she thought EQT Energy had the deal
     so the gas should be in EQT Energy’s pool rather than DFS’s
     [pool]. Consequently, she transferred the gas, meaning that
     Equitrans cancelled DFS’s credits of approximately $1.5 million
     [worth of gas] for April, May, and June and gave the credits to
     EQT Energy. Ms. Crider did so without first notifying EQT Energy
     or DFS.
        4
          There were negotiations between Mr. Rafferty (EQT
        Energy) and Mr. Tipton beginning in March 2008 and
        ending in the middle of April 2008.

     Immediately after she made the transfer, she advised Bernie
     Miele, her contact person at DFS, that she had switched the
     credits from DFS to EQT Energy. Ms. Miele responded through
     emails stating that the gas belonged to DFS and that DFS had
     already paid XTO for April, May, and June.

     Ms. Crider also notified Steve Rafferty at EQT Energy of the
     transfer. On September 2, 2008, he told Ms. Crider that EQT



                                    -5-
J-A04028-14


     Energy had no claim for the gas—there had been negotiations
     but they never had a deal.5
        5
          He also testified that one of his conditions for a deal
        was his receiving a release from DFS.

     Ms. Crider subsequently removed from EQT Energy the April,
     May, and June credits she had given to EQT Energy. However,
     she mistakenly failed to give these credits back to DFS.

     Also, because Equitrans did not re-designate, as DFS meters,
     [the Meters], no one received any credit for XTO’s July through
     October deliveries to [the Meters]. In addition, DFS reversed the
     $1.5 million payments made to XTO for the April-June deliveries.
     Thus, XTO has never received any payments for the gas
     delivered between April and October 2008.6
        6
           It is the position of Equitrans that this gas, which on
        paper remains in the gathering system, belongs to DFS
        and that XTO is entitled to payment based on the contract
        price.

     Four days after Equitrans removed the credits from DFS and
     placed them with EQT Energy, DFS made the decision to walk
     away from its contracts with XTO for the period from April 1
     through October 31, 2008. The decision was made by Joseph
     Vanzant, DFS’s Vice President.

     He testified that several events caused him to take this position:

     Event 1—He learned from Bernie Miele that Ms. Crider told
     Ms. Miele that Equitrans was going to take the gas from DFS
     retroactive to April 1 because it belonged to someone else.7
        7
            Mr. Vanzant also knew or should have known that on
        the same date that Ms. Crider told Ms. Miele that she had
        transferred the credits to EQT Energy, through e-mails,
        Ms. Miele told Ms. Crider that this was DFS’s gas and that
        DFS had paid for the gas. In the first e-mail, Ms. Miele
        states that DFS does have [the Meters] under contract
        with XTO.      She further states that the contract was
        renewed in April 2008 and again in July with new
        ownership [i.e., upon XTO’s succession to the wells as part
        of its transaction with Linn].

     Event 2—Mr. Vanzant had a DFS buyer, Neil Stultz, call Curt
     Tipton (now a former Linn employee who had never been

                                    -6-
J-A04028-14


       employed by XTO) to find out if there had been the sale of this
       gas from the DFS meters to another party. Mr. Vanzant testified
       that Mr. Stultz advised him that Mr. Tipton said to Mr. Stultz that
       he had sold the gas to EQT Energy (Steve Rafferty) back in April
       and forgot to take the gas off DFS’s contract.

       Event 3—Mr. Vanzant checked with his chief accountant and
       determined that because of falling gas prices, DFS would save
       several hundred thousand dollars if it walked away from the
       agreements with XTO.         See the following e-mail from
       Mr. Vanzant to DFS’s chief accountant explaining that DFS would
       net approximately $450,000 if it did not purchase the gas
       pursuant to the agreements with XTO because of the decline in
       the price of gas:

          Equitrans confirmed this morning something they told us
          last week. They have been crediting gas to DFS from
          4 XTO meters that XTO sold to EQT Energy starting in April
          (XTO never told us they were going to sell this gas to EQT
          Energy and we included the 4 meters in our renewal of the
          XTO contract starting April 1). Equitrans is going to deduct
          this double-counted gas from DFS’s pool, creating a big
          negative imbalance that DFS will have to fix [by obtaining
          and depositing in the pool an amount of gas equal to the
          negative imbalance].

          Happily, the nearly 138,000 [dekatherms] being taken
          away for the months April, May and June was priced at an
          average of $11.22/dth. We will start bringing in TCO gas 3
          immediately to replace the gas being taken away.
          Assuming we buy the TCO gas at today’s spot prices, plus
          TCO transport shrink, the replacement cost delivered to
          [the] TCO/Equitrans interconnect will be in the
          neighborhood of $7.90/dth. I figure this adjustment from
          Equitrans will net us somewhere near $450,000 in reduced
          gas cost. Yay!


____________________________________________


3
      In our review of the record, we cannot discern to what “TCO gas”
specifically refers, but we assume that this relates to another source of
natural gas sufficient to make up the deficit that would be created were DFS
not to claim XTO’s production.



                                           -7-
J-A04028-14


     Later that day, Mr. Vanzant explained in a subsequent e-mail to
     DFS’s chief accountant that the economic benefit would be even
     greater than $450,000 because DFS would be able to replace the
     gas it was expecting from XTO in the future at lower prices.

     Mr. Vanzant testified at pages 222-224 of his deposition that as
     of September 2 or September 3, he chose to walk away from the
     contract:

       A. . . . . When I agreed to walk away, based on the
       financial analysis that I did, it’s my opinion that at that
       point the meters were deleted retroactive to April 1.

       Q. Okay. So I think you’ve answered my question. Your
       answer is as of September 2nd or 3rd of ’08, you had a
       valid existing and enforceable contract for the meters with
       XTO, and it was your choice to either enforce those rights
       or acquiesce and walk away from the contract as of that
       date; correct?

       A. Yes.

       Q. And you chose to walk away?

       A. Yes.

       Q. And you chose to walk away retroactively back to
       April 1, 2008?

       A. In my opinion, there were only two options: walk away
       effective April 1 or enforce it going forward.

       Q. And if you walked away from the contract as of I’ll just
       use September 2nd, 2008, you wouldn’t have any claim to
       that gas from that day going forward; correct?

       A. I wouldn’t have any claim on that gas retroactive to
       April 1.

       Q. Okay.   Which would include the period following
       September 2nd, 2008, obviously?

       A. Yes.

     Mr. Vanzant also testified that he never informed XTO in writing
     that he had chosen to walk away from the contract until he sent
     XTO the meter deletion in the first week of November, that he



                                  -8-
J-A04028-14


      never spoke to EQT Energy, and that he never explained DFS’s
      position to Equitrans:

         Q. Did you inform XTO in writing that that’s what you had
         chosen to do?

         A. Not until we sent them the meter delete amendment in
         the first week of November.

         Q. And when you sent them the meter deletion
         amendment, did you—aside from sending them that form
         that you were agreeing to delete those meters as of
         whatever that day was, 11/1/2008, did you explain that
         you had made a decision to not enforce your rights, to
         walk away from the contract on September 2nd or
         September 3rd?

         A. I did not explain our position to XTO.

         Q. Did you explain that position to EQT Energy?

         A. I have never spoken to EQT Energy.

         Q. And did you explain that position to Equitrans?

         A. No.

         Q. Did anyone at DFS explain that position to Equitrans?

         A. No one asked our opinion. So I guess the answer is no.

Trial Court Opinion (“T.C.O.”), 6/12/2012, at 1-7 (nomenclature modified for

consistency).

      In explaining its rejection of DFS’s equitable estoppel defense to XTO’s

breach of contract claim, the trial court highlighted additional aspects of

DFS’s conduct in the wake of its discovery of Ms. Crider’s error:

      DFS contends that the doctrine of equitable estoppel allows DFS
      to walk away from the contract. This doctrine might possibly
      apply if XTO engaged in conduct [that] caused DFS to believe
      that the gas was under contract with EQT Energy on the date
      [that DFS] decided to walk away from the contract.


                                     -9-
J-A04028-14


     Obviously, nothing that occurred before August 28, 2008 would
     have caused DFS to believe that the gas was under contract with
     EQT Energy because prior to this date DFS knew nothing about
     any negotiations between Linn and EQT Energy.

     DFS contends that it was misled because of the failure of XTO to
     inform DFS that the gas belonged to DFS. Because of XTO’s
     failure to demand that DFS pay for the gas, DFS believed that
     XTO recognized EQT Energy as the owner of the gas.

     This argument is inconsistent with DFS’s decision made on
     September 2, 2008 to walk away from what Mr. Vanzant
     believed to be a “valid existing and enforceable contract” . . . .
     This argument is also inconsistent with the information in Bernie
     Miele’s e-mail that the gas belonged to DFS and that DFS had
     already paid XTO for the gas.

                                  ****

     DFS appeared to be doing its best to keep the matter muddled.
     An October 15, 2008 e-mail from a DFS employee to other DFS
     employees states: “I have received several telephone calls from
     various XTO personnel requesting contact names for EQT Energy
     personnel to pursue payment for the volumes taken away from
     DFS supposedly under contract with EQT Energy. The last
     telephone caller stated XTO was not impressed with EQT Energy
     and would be contacting Stultz to ‘return’ these meters to a DFS
     purchase contract.”

     Subsequently, in an October 20, 2008 e-mail, the same
     employee asked a supervisor to deal with Bob Wimpee (XTO Vice
     President) because she [knew] that DFS [did] not want the gas
     and fear[ed] she might misspeak:

       The saga continues. . .

       Bob Wimpee called this afternoon with a simple question
       on one of the renewals we just sent him. I answered him,
       and he began to ask about this issue. I explained to him
       that I had very limited knowledge on the subject.

       I told him that the meters are on our contract. EQT
       Energy told him that these meters were not under contract
       to us, and he is questioning them further.        In the
       meantime, I went and got the scoop from Bernie.



                                   - 10 -
J-A04028-14


           I called to pass along to him that XTO put a deal in place
           with EQT Energy and that we should not have received the
           gas[,] which is why Equitrans made an adjustment to our
           pool and why we took payment back from XTO. He found
           out [that the Meters] were shut in and Curt Tipton worked
           out a deal to sell the gas to Steve Rafferty. The beauty of
           that is that neither XTO nor Equitrans can find the
           paperwork. Bob was going to call Leslie Crider to see, in
           light of the no contract information, what she had to
           authorize talking [sic] the gas from us.

           In talking with Bernie, I understand that it was actually a
           good thing for DFS to lose the gas, and that we do not
           want the gas retroactively. I do not want to misspeak to
           Bob—can you handle with him, please? . . . .

      Stultz responded through an October 21, 2008 e-mail that he
      [would] talk to Bob Wimpee.

Id. at 10-12 (nomenclature modified).

      Unsurprisingly, DFS’s decision to walk away from the Contract; DFS’s

failure to seek restoration of the improperly transferred credits; and DFS’s

refusal to pay XTO for the gas that XTO delivered to the Meters that were, at

all relevant times, assigned to DFS ultimately spawned the instant litigation.

First, on March 9, 2010, XTO filed a complaint, followed eventually by a first

amended complaint, and, finally, by a second amended complaint, which

XTO filed on June 1, 2010.        The second amended complaint named as

defendants DFS, Equitrans, EQT Energy, and EQT Corporation. Therein, XTO

asserted the following claims:

      1.     Breach of Contract against DFS;

      2.     Tortious Interference with Contractual Relations against
             EQT Energy;

      3.     Breach of Contract against EQT Energy;


                                     - 11 -
J-A04028-14


        4.    Unjust Enrichment / Quantum Meruit / Goods Accepted
              against EQT Energy;

        5.    Conversion against Equitrans; and

        6.    Vicarious Liability of EQT Energy and EQT Corporation for
              Conversion by Equitrans.

See Second Amended Complaint at 10-17.

        On June 8, 2010, DFS filed its answer, which included new matter,

counterclaims, and cross-claims.          The counterclaims against XTO were for

breach of contract and unjust enrichment.               DFS also raised cross-claims

against the EQT defendants (collectively, “EQT”)4 of conversion, tortious

interference        with   contractual     relations,    unjust      enrichment,        and

indemnification and/or contribution. On June 30, 2010, XTO responded to

DFS’ answer, adding a cross-claim in the alternative for indemnification and

joint   liability   against   EQT   in   the   event    that   DFS   prevailed     on    its

counterclaims against XTO.

        On July 1, 2010, EQT filed its answer, new matter, and cross-claim to

XTO’s second amended complaint.                Therein, EQT asserted, inter alia, a

cross-claim against DFS for indemnification.

____________________________________________


4
       In its second amended complaint, XTO explained that it used “EQT” as
a collective name for Equitrans, EQT, and EQT Corporation because “(1) that
is the nomenclature that [DFS] ha[d] used in [a prior] pleading; and
(2) after reasonable investigation such entities in many instances appear to
be indistinguishable.” Second Amended Complaint at 9 n.1. Notably, the
EQT parties have filed only joint pleadings and briefs in this litigation. Thus,
we adopt the same convention when it is not necessary or beneficial to refer
to the parties individually.



                                          - 12 -
J-A04028-14



     On September 21, 2010, DFS filed an additional cross-claim against

Linn. On September 23, 2010, the trial court entered a case management

order directing that discovery be completed by February 24, 2011; expert

reports be filed by March 24, 2011; and motions for summary judgment be

filed by April 25, 2011. On October 11, 2010, EQT filed a complaint joining

the Linn parties as defendants. Therein, EQT asserted a claim for breach of

warranty of title. On November 9, 2011, Linn filed preliminary objections to

EQT’s complaint against Linn. On January 5, 2012, the trial court sustained

Linn’s preliminary objections to EQT’s complaint with prejudice, leaving Linn

subject only to DFS’s cross-claims.

     In the months that followed, discovery was completed and all parties

filed motions for summary judgment. After hearing argument, on June 12,

2012, the trial court denied DFS’s motion for summary judgment relative to

the dueling contract claims between DFS and XTO and granted summary

judgment to XTO on its contract claim.         On July 9, 2012, the trial court

entered an order granting Linn’s motion for summary judgment relative to

DFS’s cross-claims against Linn as additional defendant. On December 28,

2012, the trial court entered an order granting EQT’s motions for summary

judgment against XTO and DFS, dismissing all of the latter parties’ claims

against EQT.

     On February 1, 2013, XTO filed a motion for summary judgment

against DFS on DFS’s claims alleging that XTO had failed to mitigate its

damages.    On March 26, 2013, the trial court granted XTO’s motion for

                                      - 13 -
J-A04028-14



summary judgment. The trial court ordered a status conference for April 18,

2013, to address the status of the parties’ various claims. At the April 18

conference, after determining that no claims remained to be resolved, the

trial court entered final judgment on all claims, ripening this case for appeal.

DFS (837 WDA 2013) filed a timely appeal on May 20, 2013, and XTO

(885 WDA 2013) and EQT (890 WDA 2013), respectively, filed timely cross-

appeals thereafter.       On June 20, 2013, this Court granted the parties’

“Consent Motion to Consolidate Related Appeals.”5

       DFS raises the following issues:

       1.     Whether DFS even breached its contract with XTO, given
       that the fact-finder could reasonably resolve ambiguous contract
       language by concluding that DFS was not obligated to pay XTO
       until gas was actually credited to DFS?

       2.    Whether XTO failed to mitigate damages resulting from
       breach of a contract for the purchase of natural gas, where XTO
       rejected a reasonable offer to purchase the gas and otherwise
       refused to sell the gas to a third party, instead choosing to watch
       the value of the gas decline over time?

       3.    Whether [EQT] wrongfully converted DFS’s property and
       tortiously interfered with DFS’s contracts, where they diverted
       gas away from DFS without permission, retained possession of
       the gas, withheld possession from DFS, and misled DFS into
       believing that the gas belonged to another buyer.
____________________________________________


5
      The trial court did not direct the parties to file concise statements of
errors complained of on appeal pursuant to Pa.R.A.P. 1925(b). In lieu of a
Rule 1925(a) opinion, for reference we have only the trial court’s several
orders and memoranda disposing of the claims at issue. We find those
discussions sufficient to elucidate the trial court’s reasoning. Thus, the
absence of a discrete Rule 1925(a) opinion presents no impediment to our
review.



                                          - 14 -
J-A04028-14



Brief for DFS at 7 (issues reordered to reflect the order of discussion).

       Excluding its counterstatement of DFS’s issues, XTO presents the

following issue:

       Whether [EQT] wrongfully tortiously interfered with XTO’s
       contracts with DFS, where they removed DFS’ credit from certain
       month[s’] gas, failed to give DFS credit for other month[s’] gas,
       knew about the DFS-XTO contract, purposefully engaged in
       conduct that prevented DFS from receiving credit for the natural
       gas, and knew there was a substantial certainty that XTO would
       be harmed by such conduct?

Brief for XTO at 6.

       Excluding its counterstatements of DFS’s and XTO’s challenges to the

trial court’s entry of summary judgment in EQT’s favor, EQT raises the

following issue:      “Whether the [t]rial [c]ourt erred in dismissing [EQT’s]

claim against [Linn]?” Brief for EQT at 4.6

       Inasmuch as each party challenges trial court rulings granting or

denying motions for summary judgment, we begin by reviewing the

governing legal standards:

       A reviewing court may disturb the order of the trial court
       [granting or denying summary judgment] only where it is
       established that the court committed an error of law or abused
       its discretion. Capek v. Devito, 767 A.2d 1047, 1048, n.1
       (Pa. 2001). As with all questions of law, our review is plenary.
       Phillips v. A-Best Prods. Co., 665 A.2d 1167, 1170
       (Pa. 1995).
____________________________________________


6
       While it has filed a brief opposing EQT’s issue and addressing other
arguments presented by DFS and XTO, Linn has not challenged any of the
trial court’s rulings.



                                          - 15 -
J-A04028-14


      In evaluating the trial court’s decision to enter summary
      judgment, we focus on the legal standard articulated in the
      summary judgment rule. Pa.R.C.P. 1035.2. The rule states that
      where there is no genuine issue of material fact and the moving
      party is entitled to relief as a matter of law, summary judgment
      may be entered. Where the non-moving party bears the burden
      of proof on an issue, he may not merely rely on his pleadings or
      answers in order to survive summary judgment. “Failure of a
      non-moving party to adduce sufficient evidence on an issue
      essential to his case and on which it bears the burden of
      proof . . . establishes the entitlement of the moving party to
      judgment as a matter of law.”               Young v. PennDOT,
      744 A.2d 1276, 1277 (Pa. 2000). Lastly, we will view the record
      in the light most favorable to the non-moving party, and all
      doubts as to the existence of a genuine issue of material fact
      must be resolved against the moving party. Penna. State
      Univ. v. County of Centre, 615 A.2d 303, 304 (Pa. 1992).

Murphy v. Duquesne Univ. of the Holy Ghost, 777 A.2d 418, 429

(Pa. 2001) (citations modified).

      [T]he issue as to whether there are no genuine issues as to any
      material fact presents a question of law, and therefore, on that
      question our standard of review is de novo. This means we need
      not defer to the determinations made by the lower tribunals. To
      the extent that [the appellate court] must resolve a question of
      law, we shall review the grant of summary judgment in the
      context of the entire record.

Summers v. Certainteed Corp., 997 A.2d 1152, 1159 (Pa. 2010)

(citations omitted).

      DFS first challenges the trial court’s rulings with respect to XTO’s

contract claim. DFS presses only one theory in arguing that the trial court

erred:   DFS contends that the relevant contract provisions, viewed as a

whole, were ambiguous. Consequently, DFS asserts, a jury, rather than the




                                   - 16 -
J-A04028-14



trial court, should have resolved that ambiguity with the benefit of extrinsic

evidence.

       Our Supreme Court has set forth the principles governing contract

interpretation as follows:

       The fundamental rule in contract interpretation is to ascertain
       the intent of the contracting parties. In cases of a written
       contract, the intent of the parties is the writing itself. When the
       terms of a contract are clear and unambiguous, the intent of the
       parties is to be ascertained from the document itself. When,
       however, an ambiguity exists, parol evidence is admissible to
       explain or clarify or resolve the ambiguity, irrespective of
       whether the ambiguity is patent, created by the language of the
       instrument, or latent, created by extrinsic or collateral
       circumstances.    A contract is ambiguous if it is reasonably
       susceptible of different constructions and capable of being
       understood in more than one sense.             While unambiguous
       contracts are interpreted by the court as a matter of law,
       ambiguous writings are interpreted by the finder of fact.

Ins. Adjustment Bureau, Inc., v. Allstate Ins. Co., 905 A.2d 462, 469

(Pa. 2006) (citations omitted).

       DFS’s entire argument is predicated upon the proposition that the

contracts governing its gas purchase contract with XTO were ambiguous, a

question of law that the trial court did not resolve in DFS’s favor.7        DFS

briefly and aptly frames the dispute as follows:

____________________________________________


7
      XTO contends that DFS waived this argument because, before the trial
court, XTO argued only that the contracts were unambiguous. Thus, XTO
contends, DFS did not preserve the alternative argument that the contracts
were ambiguous. See Brief for XTO at 28-31 (citing Pa.R.A.P. 302(a)
(“Issues not raised in the lower court are waived and cannot be raised for
(Footnote Continued Next Page)


                                          - 17 -
J-A04028-14


      XTO’s breach of contract claim can be distilled to a single issue:
      whether DFS was obligated to pay XTO for gas that Equitrans
      failed to credit to DFS’s pool. XTO posits that DFS’s payment
      obligation accrued when the gas was “delivered.” DFS interprets
      the contracts differently, to require payment only after Equitrans
      credited the gas to DFS’s pool.

Brief for DFS at 35 (citation omitted).

      The determination as to whether a contract is ambiguous is a question

of law to be resolved by the court. Kripp v. Kripp, 849 A.2d 1159, 1164

n.5 (Pa. 2004) (citing Easton v. Washington County Ins. Co., 137 A.2d

332 (Pa. 1957)).        “In making the ambiguity determination, a court must

consider the words of the argument, alternative meanings suggested by
                       _______________________
(Footnote Continued)

the first time on appeal.”)). In support of its argument, XTO directs this
Court’s attention to a slew of statements drawn from DFS’s pleadings in
which DFS asserted, in various terms, that the contracts were unambiguous.
XTO also cites Samuel Rappaport Family P’ship v. Meridian Bank,
657 A.2d 17 (Pa. Super. 1995), in support of the proposition that theories of
relief with respect to contract interpretation that are not raised in the trial
court may not be presented for the first time on appeal. DFS responds that
Rappaport is distinguishable because, in that case, the distinction was not
between two different theories of interpretation, but rather the presentation
on appeal of an ambiguity argument when in the trial court the appealing
party had raised only that a mistake rendered performance impracticable, a
question not directly implicating contract interpretation. See Omnibus Reply
Brief for DFS at 7-9. DFS further contends that its argument on appeal in
fact is couched first in plain language, and only in the alternative in terms of
ambiguity. This latter proposition is a stretch; we find only a single sentence
in DFS’s lead brief that supports its characterization, and only by implication,
see Brief for DFS at 36 (“[A]t a minimum, the contract is ambiguous . . . .”);
In substance, DFS’s argument presses only ambiguity as a basis for relief.
Nonetheless, we agree with DFS that, once it raised contract interpretation
issues, it preserved all arguments relating to interpretation, because the trial
court was obligated to take into account all governing principles of contract
interpretation in resolving the question of law. Accordingly, we decline to
find this issue waived.



                                           - 18 -
J-A04028-14



counsel, and extrinsic evidence offered in support of those meanings.

Walton v. Phila. Nat’l Bank, 545 A.2d 1383, 1388 (Pa. Super. 1988)

(citations omitted). Our standard of review for questions of law is de novo,

and our scope of review is plenary. Kripp, 849 A.2d at 1164 n.5.

      We begin our analysis by reproducing the various sections of the

contracts that the parties cite in support of their respective arguments:

      ARTICLE II—QUANTITY

                                   ****

      2.2 If Seller’s gas is to be delivered to Buyer at specified wells
      or meters, Seller dedicates to Buyer full production from Seller’s
      wells or meters listed on the Confirmation, unless otherwise
      stated on the Confirmation.

                                   ****

      ARTICLE III—DELIVERY

      3.1 The “Delivery Point(s)” for Seller’s gas shall be the wells
      and meters specified on the Confirmation . . . . Title to the gas
      shall pass to Buyer at the Delivery Point(s).

                                   ****

      3.3 As between the parties thereto, Seller shall be in control
      and possession of the gas and responsible for any injuries,
      claims, liabilities, or damages caused thereby until the gas shall
      have been delivered to the Delivery Point(s), and after such
      delivery as between Buyer and Seller, Buyer shall be deemed to
      be in possession and control thereof and responsible for any
      injuries, claims, liabilities, or damages caused thereby . . . .

                                   ****

      ARTICLE IV—PRICES

                                   ****

      4.2.1 . . . Buyer should make payment to Seller on or about the
      25th day of the month following the production month . . . .

                                    - 19 -
J-A04028-14


       ARTICLE V—MEASUREMENT

       5.1 Unless otherwise stated on the Confirmation, all gas
       delivered by Seller to Buyer shall be measured in Dekatherms at
       the Delivery Point(s). Buyer shall pay for Seller’s gas in the
       quantity credited to Buyer’s account by the Pipeline.

The Contract at 1-2.

       DFS contends that it is reasonable to interpret paragraph 5.1 of the

Contract as preventing XTO from establishing DFS’s putative obligation to

pay for gas delivered from April through October 2008, because that

production was never credited to DFS’s pool. Framed in the terms used in

paragraph 5.1, DFS cannot “pay for Seller’s gas in the quantity credited to

Buyer’s account by” Equitrans when Equitrans has not credited Buyer’s

account at all.8 DFS elaborates on its argument as follows:

       Importantly, the [Contract does] not state that DFS is obligated
       to pay for gas that flows through a meter if it is not credited to
       DFS’s pool.     XTO argued that DFS was obligated to pay
       regardless of whether Equitrans credited DFS’s pool for the gas.
       DFS, on the other hand, interprets the [Contract] to condition
       DFS’s payment obligation upon two events: (1) gas flowing
       through the Meters and (2) Equitrans crediting this gas to DFS’s

____________________________________________


8
      There is no dispute that, as of the inception of this litigation, Equitrans
had not credited DFS’s account. However, Equitrans did, in 2011, tender the
appropriate credits to DFS, which DFS refused to accept. See Letter from
Patrick Cavanaugh to Brian Wood, 1/24/2011 (offering to tender mis-
assigned credits); Letter from Brian Root to Patrick Cavanaugh, 1/27/2011
(declining the credit on the bases that the volumes “do not belong to [DFS]”
and due to the pending lawsuit”). Brian Root’s letter declining the credit was
erroneous in one particular:      DFS does not dispute that the Contract
specified that title would pass to DFS upon XTO’s delivery of the gas to the
Meters, which XTO undisputedly did.



                                          - 20 -
J-A04028-14


       pool. The choice between these competing constructions cannot
       be made by the court, but rather is reserved for the fact-finder.

Brief for DFS at 38 (emphasis in original).        DFS argues that any other

interpretation would nullify paragraph 5.1.

       XTO provides the following summary of its contrary position:

       DFS’[s] position is a remarkably brazen one. The only contract
       in existence is between []XTO and DFS, under which XTO fully
       performed every month in question by timely delivering gas to
       DFS, and under which DFS paid XTO. But when [Equitrans]
       reversed DFS’[s] previous credit for XTO’s gas, DFS did not ask
       [Equitrans] for a return of the credit. Instead, DFS quickly
       analyzed the economics of the event and determined that in light
       of falling gas prices it could make a quick $450,000 due to
       [Equitrans’] improper reversal of credit. Thus, within a matter of
       days of [Equitrans’] misdeed, DFS unilaterally decided that it
       was no longer under contract with XTO. DFS has not paid XTO
       since for the subject gas. Thus, DFS’[s] scheme was to use
       [Equitrans’] transgression as an excuse to profit at XTO’s
       expense. DFS’[s] modus operandi was its refusal to ask for the
       credit to be returned. Those are the reasons DFS has been
       forced to contrive a construction of Section 5.1 that does not
       require [XTO] to be paid unless [Equitrans] first gives [DFS]
       credit for the gas.

Brief for XTO at 33.

       XTO also maintains that DFS’s argument effectively transforms a minor

provision related to the measurement of the gas delivered (paragraph 5.1)

into   a   condition   precedent   that   effectively   nullifies   paragraph 3.1,

confounding the established principle that a condition precedent will only be

recognized as such when the parties’ intent to treat it that way can be

discerned from the contract language read as a whole. Id. at 35-37 (citing,

inter alia, Acme Markets, Inc., v. Fed’l Armored Express, Inc., 648 A.2d


                                     - 21 -
J-A04028-14



1218, 1220 (Pa. Super. 1994) (“While the parties to a contract need not

utilize any particular words to create a condition precedent, an act or event

designated in a contract will not be construed as constituting one unless that

clearly appears to have been the parties’ intention.” (emphasis in original));

West Dev. Group, Ltd., v. Horizon Fin’l, F.A., 592 A.2d 72, 76

(Pa. Super. 1991) (“Generally, an event mentioned in a contract will not be

construed   as   a   condition   precedent    unless   expressly   made   such   a

condition.”)).

      The trial court rejected DFS’s argument for the following reasons:

      [I]t is XTO’s position that the scope of Article V is defined by its
      title: “Measurement.” This is a two-sentence Article. The first
      sentence explains how gas shall be measured. The apparent
      purpose of the second sentence is to have [Equitrans’]
      measurements govern what DFS will pay and XTO will receive.

      In this case, there is no dispute over the quantity of the gas that
      XTO delivered. The dispute is over who owns the gas that XTO
      delivered. This is not a matter that the parties would have
      intended for Equitrans to decide because this dispute has
      nothing to do with information known to Equitrans.
      Consequently, I find DFS’s reliance on Section 5.1 to be
      misplaced.

      However even assuming that [paragraph] 5.1 applies, DFS
      cannot simply decide to accept Equitrans’ decision to take away
      DFS’s credits for gas DFS believed to be its gas and for which
      XTO is entitled to be paid. Title had passed to DFS, and it would
      have been the expectation of both parties that delivery and
      transfer of title would result in Equitrans furnishing credit for the
      gas to DFS.        DFS cannot both hold title and express no
      opposition to a decision of Equitrans to credit another entity for
      the gas to which it holds title.

      In this case, it would have been easy for DFS to have the credits
      restored and the credits for future deliveries to be credited to
      DFS. Equitrans was confused as to whether DFS or EQT Energy

                                     - 22 -
J-A04028-14


     should receive credits for the gas delivered by XTO. Since EQT
     Energy was not claiming that it should be credited for the gas,
     there would not have been any opposition to a request made by
     DFS to Equitrans to give DFS the credits for the gas delivered by
     XTO. DFS, instead, chose not to approach Equitrans, apparently
     because of the financial benefits that it would receive from the
     decline in the price of gas if Equitrans did not reverse the
     transaction.

     DFS contends that under [paragraph] 5.1, a Pipeline credit is a
     condition precedent to payment.         However, Equitrans is
     obligated to give credit to DFS for gas in the gathering pool
     belonging to DFS.    DFS cannot refuse to pay for the gas
     delivered by XTO if DFS never sought a credit that would have
     been given. In other words, the credit was DFS’s for the asking.
     Since it never asked for the credit, it cannot rely on
     [paragraph] 5.1.

T.C.O., 6/12/2012, at 13-14 (footnote omitted; nomenclature modified).

The trial court further observed that “[t]he Uniform Commercial Code

provides that every contract imposes an obligation of good faith in its

performance.” Id. at 14 n.13 (citing 13 Pa.C.S. § 1304).

     Aside from boilerplate citations in support of global principles of

contract interpretation, DFS’s entire argument consists of an appeal to

common sense not unlike the trial court’s, although their respective analyses

lead to divergent outcomes. In this connection, DFS neither acknowledges

nor attempts to explain or excuse its undisputedly conscious decision to

abandon the Contract (and, consequently, not actively seek restoration of

the misplaced credit) primarily or exclusively when it discovered that it

would lose money if it adhered to the Contract. Furthermore, XTO had no

contractual relationship with—and hence no authority to compel action by—

Equitrans.    Rather, DFS alone had such a relationship and the closely

                                   - 23 -
J-A04028-14



correlated discretion to press the matter until Equitrans’ accounting error

was rectified. But DFS, seeing a benefit to be gained by sitting on its hands,

declined to act.    At that point, XTO undisputedly had fully performed its

obligation under the Contract; DFS, in turn, relied upon a situation over

which it had far more control than XTO to avoid rendering quid for XTO’s

quo.

        Although we recognize some substance to DFS’s contentions regarding

the availability of two interpretations, we do not believe that DFS’s

interpretation of paragraph 5.1 of the Contract is reasonable as a matter of

law. As XTO correctly notes, the law is loath to impute the parties’ mutual

intention to impose a condition precedent on performance in the absence of

clear evidence of that intent.         Viewing paragraph 5.1 in isolation or in

tandem     with   the   balance   of   the   Contract,   and   in   particular   with

paragraph 3.1, which confers title to the gas in question upon DFS upon

XTO’s performance, it would be a stretch to find such an intention in this

case.

        Indeed, all that gives DFS’s interpretation the patina of reason are the

unusual circumstances surrounding this case. Where the situation diverged

from common experience was in Equitrans’ failure not only to remove the

credit from EQT Energy without documentation supporting the removal, as it

did, but also its failure to return the credit to DFS immediately, as its own

records indicated should have happened.          Things only devolved when DFS

declined to pursue those credits in pursuit of greater profit.

                                        - 24 -
J-A04028-14



      Needless to say, in any given case where something like this happens,

if payment is required notwithstanding the pipeline’s failure to account for

the credits arising from a seller’s delivery of gas to the meters, it may be

difficult to reach an estimate of the payment obligation in question.

However, four considerations militate against inferring from this observation

that, under the circumstances of this case, a buyer is relieved of any

payment obligation unless and until a party with whom the seller has no

contractual relationship holds up its own end of a separate bargain between

pipeline and buyer.   First, there is no dispute that DFS initially was made

aware of the credits that had been assigned at least for the months of April,

May, and June of 2008:      DFS timely paid XTO upon receiving Equitrans’

accounting for XTO’s deliveries in those months, deducting that payment

from future transactions only when it discovered that Equitrans had removed

and failed to restore those credits. Second, as noted by XTO, adjustments

to prior months’ accountings, sometimes substantial ones, are de rigeur in

the industry and sometimes occur following a significant delay following the

period to be adjusted.   See Brief for EQT at 8 (“If there is an error in an

invoice, it is common gas industry practice for the gathering system operator

[i.e., Equitrans] to issue a Prior Period Adjustment (“PPA”) in the next

monthly invoice.”). Third, just as DFS affirmatively could have taken steps

to ensure that Equitrans rectified its error, it also could have asked Equitrans

to account for XTO’s production for July through October of 2008,

encompassing the remaining period at issue in this litigation. Finally, as the

                                     - 25 -
J-A04028-14



trial court observed, DFS long has known the volume of XTO’s production.

See T.C.O., 6/12/2012, at 13 (“In this case, there is no dispute over the

quantity of the gas that [XTO] delivered.”).

       While this case might have been extraordinary enough to preclude the

parties’ anticipation of such events in drafting the Contract, we conclude that

it is not reasonable to imagine that XTO intended, under paragraph 5.1, that

a buyer might delay its performance indefinitely as a consequence of a third-

party error, let alone that it might do so while endeavoring consciously to

profit from the mistake. With XTO’s delivery to the Meters, its performance

obligation was satisfied and title for the gas passed to DFS, legally triggering

DFS’s obligation to perform.        At a minimum, it was reasonable for DFS to

take such steps as were necessary to ensure that the delivered gas was

accounted for in due course.           The trial court did not err in so finding.9

Consequently, we affirm the trial court’s entry of summary judgment in

favor of XTO on its contract claim.

       We note as well the dangerous precedent we would set in endorsing

DFS’s conduct in this case. Were we to do so, no similarly structured gas

purchase contract would be safe. To wit, because there is a one- to two-

month lag between delivery and accounting, any time the price drops
____________________________________________


9
      In another, similar situation, a fair and difficult dispute might arise as
to what sort of payment would be due from a buyer to a seller when an
accounting had not yet been provided. But, as set forth above, this is not
such a case.



                                          - 26 -
J-A04028-14



relative to the contractual purchase price during the lag between delivery

and accounting, it would be in the buyer’s interest to abandon the contract

and seek an equal measure of gas elsewhere at a better price. This would

be tremendously disruptive, were it to become commonplace.

      In DFS’s second issue, DFS contends that the trial court erred when it

dismissed DFS’s claims that XTO failed to mitigate damages. See Brief for

DFS at 30-35. The trial court so ruled upon two bases: first, because DFS

and XTO had equal opportunities to mitigate the damages in question and,

second, because there could be no certainty that, if XTO sold the gas at

issue in this case to another buyer, it would have obtained a better price

than it would have received at some other time. T.C.O., 3/28/2013, at 3-5.

      DFS contends that the trial court should have concluded that jury

questions inhered in whether XTO had a superior opportunity to sell the gas,

thereby mitigating damages, and that DFS “never had the ability to obtain

and sell the gas to mitigate damages.” Brief for DFS at 31. DFS’s argument

hinges upon the proposition that questions of fact remain regarding whether

DFS relinquished its rights to the gas, whether the gas was credited to

another potential buyer (e.g., EQT Energy), and whether XTO had “specific

and definite opportunities to sell the gas, including an offer from EQT Energy

to purchase the gas at the November 2008 market price.” Id. at 34. DFS

further contends that the evidence would support a jury finding that

“Equitrans, for its part, worked exclusively with XTO to facilitate a sale of the




                                     - 27 -
J-A04028-14



gas, and permitted XTO to try to sell the gas while it sat on the Equitrans

system.” Id. (citations omitted).

     XTO responds first that DFS is mistaken in asserting that XTO had the

“superior” opportunity to sell the gas or that the mitigation question,

focusing as it does upon the reasonableness of the efforts to mitigate made

by the party with the burden of doing so, cannot be resolved as a matter of

law. Brief for XTO at 24 (citing, inter alia, Loyal Christian Benefits Ass’n

v. Bender, 493 A.2d 760, 763-64 (Pa. Super. 1985) (affirming disposition of

mitigation claim on summary judgment)). XTO further emphasizes that XTO

had no legal right to dispose of gas to which XTO undisputedly had no title

once it was delivered it to the Meters. Id. at 26-27. XTO maintains that the

trial court correctly found that DFS undisputedly had an obligation to seek

restoration of the credits, that DFS failed to do so because it sought a

financial advantage that lay in relinquishing those rights, and that DFS

cannot seek relief from XTO for not selling gas that DFS could have taken

control of merely by demanding that Equitrans credit DFS for the gas.

See id. at 24-28.

     It is true that “a party who suffers a loss has a duty to make a

reasonable attempt to mitigate damages.” Ecksel v. Orleans Constr. Co.,

519 A.2d 1021, 1028 (Pa. Super. 1987).       However, “[t]he injured party is

not obligated to mitigate damages where both he and the liable party have

an equal opportunity to reduce damages.”         Bender, 493 A.2d at 763

(Pa. Super. 1985) (citing S.J. Groves & Sons Co. v. Warner Co., 576 F.2d

                                    - 28 -
J-A04028-14



524 (3d Cir. 1978)). While we are not bound by the S.J. Groves decision,10

we nonetheless believe that it ruled consistently with Pennsylvania law when

it made the following observation:

       Where both the plaintiff and the defendant have had equal
       opportunity to reduce the damages by the same act and it is
       equally reasonable to expect the defendant to minimize
       damages, the defendant is in no position to contend that the
       plaintiff failed to mitigate. Nor will the award be reduced on
       account of damages the defendant could have avoided as easily
       as the plaintiff. The duty to mitigate damages is not applicable
       where the party whose duty it is primarily to perform a contract
       has equal opportunity for performance and equal knowledge of
       the consequences of nonperformance.

576 F.2d at 530 (citations omitted); accord TruServ Corp. v. Morgan’s

Tool & Supply Co., Inc., 39 A.3d 253, 262 (Pa. 2012). Plainly, the latter

conditions were true of DFS in the instant case, and, in effect, the trial court

so concluded. See T.C.O., 3/28/2013, at 3-4.

       It is important to note that “the burden is on the party who breaches

the contract to show how further loss could have been avoided through the

reasonable efforts of the injured party.”          Ecksel, 519 A.2d at 1028.

Moreover, contrary to DFS’s position, this Court has blessed trial court

determinations as a matter of law that no duty to mitigate existed under


____________________________________________


10
       Cf. Martin v. Hale Prods., Inc., 699 A.2d 1283, 1287
(Pa. Super. 1997) (“Decisions of the federal courts lower than the United
States Supreme Court possess a persuasive authority. Nevertheless, a
federal court’s interpretation of state law does not bind state courts.”
(citations omitted; emphasis in original)).



                                          - 29 -
J-A04028-14



such circumstances, demonstrating that it is not per se necessary to submit

a dispute about such opportunities to a jury.       Id.; Dox Planks of N.E.

Penna. v. Ohio Farmers Ins. Co., 621 A.2d 132 (Pa. Super. 1993).

      This Court’s decision in Dox Planks is instructive.       At issue in that

case was the duty to mitigate of a supplier of pre-cast concrete barriers to

the appellant contractor. The trial court determined as a matter of law, and

this Court agreed, that because the barriers already had been received by

the contractor and had been used on the underlying highway project at the

time of the contractor’s breach of its obligation to pay, the appellee supplier

“was precluded from taking steps to avoid loss on the breach of the

contract.” 621 A.2d at 135-36.

      While it is true that DFS opted not to act upon its right to the gas, it is

equally true that it would have taken little effort for it to do so and that DFS,

in fact, recognized that it had an obligation to do so. See, e.g., Deposition

Testimony of Joseph Vanzant, 12/1/2010, at 151 (“If I had gone to [XTO]

and [XTO] had said that was not correct, they had not sold [the gas] to

anyone else, then [DFS] would have had an obligation to go back to

Equitrans and contest their removal . . . of the volumes.”).      Indeed, at all

relevant times it would have been easier for DFS to claim and sell the credits

(at whatever price) to which it already had title than it would have been




                                     - 30 -
J-A04028-14



for XTO to seek to reclaim title to those credits and resell them. 11 Instead of

already having taken advantage of the credits and refusing to pay, as the

contractor had done with the concrete barriers in Dox Planks at the time of

the breach, DFS figuratively left the concrete barriers (i.e., the gas credits)

in a side lot on its work site (i.e., Equitrans’ pool) but deliberately refused to

install them, having found another supplier offering comparable items at a

lower price. Then the buyer (i.e., DFS) insisted that the seller (i.e., XTO)

had the principal duty to resell the barriers of which the seller no longer had

title or possession.

       It makes little sense to submit the question to a jury when the

breaching party fails to establish a prima facie case that the non-breaching

party had an opportunity to mitigate, and that its opportunity was at least

superior to that of the breaching party; the law does not require otherwise.

We conclude that the trial court did not err as a matter of law or abuse its

discretion when it determined that DFS had sufficient opportunity to mitigate

the impending damages from DFS’s own breach of contract and that XTO



____________________________________________


11
      That this is the case is established constructively by Crider’s deposition
testimony acknowledging that she was mistaken initially in transferring
credit to EQT Energy and thereafter mistaken in removing the credit from
EQT Energy without restoring it to DFS. She responded affirmatively during
her deposition when asked whether she “should have given DFS credit”
when she discovered her error. Deposition of Leslie Crider, 11/16/2010,
at 77-78.    She further testified that such transfers of credits are an
appropriate subject of a prior period adjustment (“PPA”). Id. at 87.



                                          - 31 -
J-A04028-14



had no obligation to mitigate those damages.          Thus, we affirm the trial

court’s rejection of DFS’s claim for mitigation.

      In DFS’s final issue, it argues that the trial court erred in granting

summary judgment to EQT on DFS’s cross-claims for conversion and tortious

interference with DFS’s contractual relationship with XTO.         Brief for DFS

at 41-63. We address these issues in turn.

      A claim for conversion will lie when one party denies another party’s

“right of property in, or use or possession of, a chattel, without the owner’s

consent and without lawful justification.” Shonberger v. Oswell, 530 A.2d

112, 114 (Pa. Super. 1987) (citing Stevenson v. Economy Bank of

Ambridge, 197 A.2d 721, 726 (Pa. 1964)).            Specific intent need not be

proved: “[A]n intent to exercise dominion or control over the goods which is

in fact inconsistent with the [victim’s] rights establishes the tort.”        Id.

Moreover, money may be the subject of a claim for conversion.                 Id.;

cf. Pittsburgh    Constr.   Co.   v.    Griffith,   834   A.2d   572,   581   (Pa.

Super. 2003) (“Money may be the subject of conversion.”).           Nonetheless,

“[n]ot every destruction or deprivation of property amounts to a conversion;

there must be an actual appropriation of it by the offending party for his

own use.”      Chrysler Credit Corp. v. Smith, 643 A.2d 1098, 1100

(Pa. Super. 1994) (quoting 37 P.L.E. Trespass § 81) (emphasis added).

      This last point is germane inasmuch as we find little merit to EQT’s

argument that, given the nature of Equitrans’ function, the actual molecules

delivered to the Meters by XTO were never possessed by Equitrans, but

                                       - 32 -
J-A04028-14



rather that the subject behavior reflected merely an accounting error.                  Be

that as it may, we are not prepared to hold that such rights, which are not

unlike cash in hand, cannot form the subject of a conversion claim. But see

Pittsburgh Constr. Co., 834 A.2d at 581 (“[T]he failure to pay a debt is not

conversion.”).     We assume arguendo that they may, but we find DFS’s

argument unavailing for other reasons.12

       Specifically, we find that DFS has failed to establish both a lack of

consent and a lack of justification. Undisputedly, Equitrans’ accounting error

resulted only in a brief deprivation of DFS’s rights to the subject gas, one

which was rectified at the time that DFS learned of Equitrans’ misfeasance.

After it obtained such knowledge, however, DFS did not take the slightest

step to rectify the error; rather, it deliberately considered how best to

benefit from the mistake.         Moreover, upon partial correction of the error

(i.e., by removing the credit from EQT Energy’s pool without restoring it to

DFS), Equitrans did not hold the gas to its own benefit or that of EQT

Energy, but rather in a sort of limbo that persisted only because no entity

claimed it.

       In Norriton East Realty Corp. v. Central Penn Nat’l Bank,

254 A.2d 637 (Pa. 1969), our Supreme Court held that a similar variety of

acquiescence      constituted    consent       sufficient   to   preclude   a   claim   for

____________________________________________


12
    This Court may affirm a trial court ruling on any correct basis.
Rambo v. Greene, 906 A.2d 1232, 1235 n.4 (Pa. Super. 2006).



                                          - 33 -
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conversion. In that case, the appellant-mortgagor, at appellee-mortgagee’s

request, assigned all leases for the subject property to the mortgagee and

directed its rental agent to turn over all rents to the mortgagee.       The

mortgagee later initiated foreclosure proceedings and purchased the

property at a sheriff’s sale. After further proceedings, the mortgagor filed

suit against the mortgagee (which by then had surrendered the property and

appurtenances to a third party) for conversion arising from the mortgagee’s

alleged improper retention of various appliances that were not implicated in

the foreclosure action. Id. at 638.

     Our Supreme Court reversed the lower court’s determination that the

mortgagee had converted the subject items. The Court noted first that the

intent requirement was not satisfied:      Because the goods originally came

into the possession of the mortgagee with the consent of the mortgagor,

they were not transferred in violation of the mortgagor’s possessory rights.

Moreover, our Supreme Court found that “[p]ossession was not withheld

since no demand was made of [the mortgagee] at any time [that the

mortgagee] could have acquiesced.” Id. at 639 (emphasis added). “A

defendant who has come rightfully into possession in the first instance,” the

Court explained, “becomes a converter when he refuses to deliver on

demand.    Since there has been no wrongful taking or disposal of the

property, demand and refusal are necessary to complete the tort.”        Id.

(quoting Prosser, Torts § at 74 (2d ed. 1955)).      Because the mortgagor

made no demand until after the mortgagee had transferred the personalty in

                                      - 34 -
J-A04028-14



question to a third party, and therefore had relinquished the ability to return

the party to the mortgagor, “there was no unreasonable withholding.” Id.

      At no time relative to this appeal did DFS make any demand of

Equitrans that it restore DFS’s credits for the gas in question.       To the

contrary, DFS made a calculated decision not to pursue those rights, was

notably tardy in informing its counterparties of that decision, and even

refused the credits in question when tendered by Equitrans in 2011. With

DFS, the only party with a proper claim to the gas, refusing to claim it, we

must conclude that Equitrans did not act wrongfully in leaving it in limbo: It

was neither Equitrans’ nor EQT Energy’s nor XTO’s gas to sell. It would defy

reason to hold Equitrans responsible for retaining credit that its rightful

owner had disclaimed.    DFS’s conduct was inconsistent with a conversion

claim when its calculated acquiescence to Equitrans’ retention of the credits

was practically indistinguishable from consent.    Inasmuch as there are no

genuine issues of material fact calling into question whether DFS willfully

acquiesced to Equitrans’ actions, the trial court did not err in granting

summary judgment to EQT on DFS’s conversion claim.

      Turning to DFS’s argument in support of its tortious interference claim

against EQT, see Brief for DFS at 48-49, DFS correctly notes that, in

Pennsylvania, such claims are governed by the Restatement (Second) of

Torts § 766A, which provides as follows:

      One who intentionally and improperly interferes with the
      performance of a contract . . . between another and a third
      person, by preventing the other from performing the contract or

                                    - 35 -
J-A04028-14


       causing his performance to be more expensive or burdensome,
       is subject to liability to the other for the pecuniary loss resulting
       to him.

See also Al Hamilton Contr. Co. v. Cowder, 644 A.2d 188, 191

(Pa. Super. 1994).

       Without delving into the other elements of such a claim, we find that

DFS’s argument in support of this claim is afflicted with difficulties

establishing pecuniary loss. Noting that the price of gas has fallen steadily

since 2008, DFS argues that EQT’s failure properly to credit the gas to DFS

in a timely manner denied DFS the opportunity to sell the gas at more

favorable 2008 prices. DFS notes that the gas was not ultimately credited

until 2013, late in the instant litigation.        See Brief for DFS at 59-60.

However, DFS deliberately did not ask that its credits be restored in 2008.

Rather than seek prompt action to correct what amounted to a bookkeeping

error, DFS was content, even eager,13 to make up its negative balance in the

pool with the less expensive gas that was available at that time.

       DFS maintains that what it deemed favorable at the time was, in fact,

injurious:

       Because Equitrans chose not to credit DFS’s pool for the April
       through October 2008 gas production when it entered the
____________________________________________


13
     In an e-mail from Joseph Vanzant to Wayne Hinter transmitted on
September 2, 2008, i.e., the very day that the crediting error first came to
DFS’s attention, Vanzant estimated that “this adjustment from Equitrans will
net us somewhere near $450,000 in reduced gas costs. Yay!” (emphasis
added).



                                          - 36 -
J-A04028-14


       Equitrans gathering system, Equitrans prevented DFS from
       reselling the gas at that time, when the market value of the gas
       was much more favorable, and instead has compelled DFS to sell
       the gas in a less favorable market, and at a substantial loss.

Brief for DFS at 60.14           However, DFS effectively gambled on XTO’s

willingness to acquiesce to DFS’s abandonment of the Contract, a gamble

that it lost. That DFS’s expectation that abandonment would redound to its

benefit proved short-sighted does not establish that DFS suffered actionable

damages.

       Furthermore, DFS has failed to establish that EQT’s actions prevented

DFS from its performance under the Contract. First, it cannot be said that

EQT    in   any   way    interfered     with     XTO’s   performance,     because   XTO

undisputedly fully satisfied its obligations under the Contract.            Second, for

precisely the same reason that we reject DFS’s interpretation of the

Contract,    we     must     conclude     that     DFS    was   obliged    to   perform

notwithstanding Equitrans’ mistakes.               While those mistakes may have

complicated the process by which DFS could have performed, it cannot be

said that EQT prevented DFS from doing so pursuant to the terms of the

Contract.


____________________________________________



14
      The trial court noted that DFS did not raise “a claim for losses
sustained, because of falling gas prices, between the date that the credits
were removed and the date they would have been restored if [DFS] had
taken reasonable steps to have the credits restored.” T.C.O., 12/28/2012,
at 2 n.2.



                                          - 37 -
J-A04028-14



       Finally, and perhaps most importantly, the record establishes that

DFS’s failure to perform was exclusively of its own choosing, reflecting

precisely the sort of bad faith that the Uniform Commercial Code proscribes.

See 13 Pa.C.S. § 1304 (“Every contract or duty within this title imposes an

obligation       of     good   faith   in   its    performance    and      enforcement.”);

cf. Duquesne Light Co. v. Westinghouse Elec. Corp., 66 F.3d 604, 617

(3d Cir. 1995) (“[C]ourts generally utilize the good faith duty as an

interpretive tool to determine the parties’ justifiable expectations . . . .”).

Absent DFS’s demand for the credit and Equitrans’ refusal—the consideration

fatal to DFS’s conversion claim—it cannot be said that there remain any

questions of material fact as to whether EQT intentionally or improperly

interfered with DFS’s performance under the Contract.                    DFS plainly chose

not to perform, and its actions and inaction—as the damages it suffered, if

any—reflected that choice. That DFS miscalculated cannot fairly expose EQT

to   liability    for    tortious   interference     associated   with    an   unfortunate

circumstance that lay within DFS’s means to rectify. Consequently, the trial

court did not err in granting EQT’s motion for summary judgment as against

DFS’s claims for intentional interference with DFS’s contract with XTO.

       The above discussion concludes our review of the issues raised by DFS

on appeal. We next consider XTO’s lone issue raised in its cross-appeal, to

wit, that the trial court erred in granting EQT summary judgment as against

XTO’s claim for tortious interference with contractual relations.




                                            - 38 -
J-A04028-14



       XTO’s argument on this issue also fails for want of a specification of

the discrete damages caused by EQT. With regard to this necessary element

of a tortious interference claim, XTO identifies only two categories of

damages: The approximately $1.5 million that it contends that it was owed

for April through June 2008 production (i.e., the amount that DFS originally

paid before deducting it when Equitrans reallocated the credit to EQT

Energy) and the approximately $1.8 million that it asserts it was owed for its

July through October 2008 production.              Brief for XTO at 50-51.      The trial

court’s entry of summary judgment in XTO’s favor as against DFS, which we

have affirmed, entered damages in precisely these amounts, as well as

awarding         substantial   pre-judgment    interest.      See    Final    Judgment,

4/18/2013, at 1 (awarding a judgment of $4,265,353.77 for XTO and

against DFS, exclusive of costs of suit).           Consequently, XTO has failed to

identify any damages arising from EQT’s conduct for which it has not already

been compensated.              Thus, we affirm the trial court’s order granting

summary judgment to EQT relative to XTO’s claim for tortious interference.

       Finally, we address EQT’s cross-claims against Linn.                 These claims

were pressed by EQT only contingently, in the event that XTO’s claims

against EQT were restored by this Court on appeal. See Brief for EQT at 53.

Because we have affirmed the trial court’s order exonerating EQT of all

liability   in     this   case,   EQT’s   cross-claims     against   Linn    are   moot.

Consequently, no relief is due.




                                          - 39 -
J-A04028-14



      For the foregoing reasons, we affirm in its entirety the trial court’s

entry of judgment in this matter, albeit in some instances for different

reasons than those offered by the trial court.

      Judgment affirmed.

Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date: 10/22/2014




                                    - 40 -
