                                  NO. 07-06-0285-CV

                             IN THE COURT OF APPEALS

                      FOR THE SEVENTH DISTRICT OF TEXAS

                                     AT AMARILLO

                                        PANEL B

                               SEPTEMBER 28, 2007
                         ______________________________

                                  HARRIET LESIKAR,

                                                              Appellant

                                            v.

                               EOG RESOURCES, INC.,

                                                     Appellee
                       _________________________________

             FROM THE 188TH DISTRICT COURT OF GREGG COUNTY;

               NO. 2003-2305-A; HON. DAVID BRABHAM, PRESIDING
                       _______________________________

                                    Opinion
                        _______________________________

Before QUINN, C.J., and CAMPBELL and HANCOCK, JJ.

      Before us is an appeal involving a written Rule 11 settlement agreement. After the

parties executed the document, the trial court attempted to enforce what it believed to be

its terms, but in doing so exceeded the scope of the accord, said Harriet Lesikar. EOG

Resources, Inc. disagreed. We reverse and remand the cause.

      Background

      The suit involved a mineral interest Lesikar inherited and her attempt to have EOG

acknowledge its extent. Also sought were damages reflecting the deficiencies in money

due her for gas taken under one or more leases encumbering the property. Upon joining
issue, the litigants executed the aforementioned Rule 11 agreement purporting to settle the

matter. It consisted of the following terms:

       1) EOG Resources, Inc. . . . will pay $22,500.00 in full and final settlement
       of any and all claims or allegations brought or which could have been
       brought by your client, Harriet Lesikar regarding the leases made the basis
       of her lawsuit;

       2) EOG will transfer to Harriet Lesikar an additional 0.0063819 working
       interest and 0.00518475 net revenue interest on the Lee B Gas Unit;

       3) Harriet Lesikar will immediately file a Motion to Dismiss With Prejudice the
       claims lawsuit filed against EOG; and

       4) both parties will execute the necessary documentation, such as stipulation
       of interest, releases, etc., in order to finalize the dispute.

Though dated August 18, 2005, the letter agreement was file-marked by the trial court clerk

on September 16, 2005. Thereafter, cross motions for summary judgment were filed.

Each litigant sought to enforce the agreement as written, but neither could agree upon its

scope. Lesikar thought it only settled claims that had matured at the time the document

became effective and that the possibility of having to recoup future, and as yet unmatured,

overcharges was omitted. EOG believed it resolved all claims of Lesikar, both those

existing and those to accrue in the future.

       Upon hearing the cross motions, the trial court granted that of EOG. Thus, it

ordered that 1) “EOG . . . pay into the Registry of the Court . . . $22,500 in full and final

settlement of any and all claims or allegations brought or which could have been brought

by . . . Lesikar regarding the leases . . .,” 2) EOG . . . effect a transfer to . . . Lesikar . . . of

an additional 0.0063819 working interest and 0.00518475 net revenue interest on the Lee

B Gas Unit . . .,” and 3) the conveyance become effective upon Lesikar’s execution of “a.

[s]tipulation of interest; b. COPAS or other document indicating an agreed lease overhead

charge; and c. [o]ther necessary documents finalizing the parties’ dispute.”

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       Issues

       The scope of the Rule 11 agreement underlies the entire controversy before us. We

construe such agreements by attempting to garner the parties’ intention through the words

used, the surrounding circumstances from which the agreement arose, the state of and

allegations in the pleadings, and the attitude of the parties with respect to the issues.

Sitaram v. Aetna U.S. Healthcare of North Texas, Inc., 152 S.W.3d 817, 824 (Tex.

App.–Texarkana 2004, no pet.); Herschbach v. Corpus Christi, 883 S.W.2d 720, 734 (Tex.

App.–Corpus Christi 1994, writ denied). With this said, we turn to the agreement and

circumstances of record.

       Per its terms, the $22,500 payment was to be made in full and final settlement of

“any and all claims or allegations brought or which could have been brought by your client

. . . regarding the leases made the basis of her lawsuit.” The claims of Lesikar actually

brought were not only of effort to have EOG recognize the extent of her interest in the

property but also of effort to recoup “charges made . . . against the wells in question

appear[ing] to be unreasonable and improperly charged against the wells.” So too did she

seek damages purportedly resulting from “overcharging for services.” As can be seen,

these particular allegations refer to past, as opposed to future, charges against the wells.

       Moreover, we cannot ignore the obvious circumstance that the economic or

business relationship between Lesikar and EOG was to be ongoing, so long as the mineral

leases remained in existence.      Not only was this circumstance existent when the

agreement was executed, but also it differs from situations wherein a settlement arises

from attempts to end a business relationship. The latter contemplates a sense of finality

between the parties to the accord. The former does not. And, given that the relationship

was to continue, our adopting EOG’s interpretation of the Rule 11 document would

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effectively preclude Lesikar from complaining about any omissions, errors or the like

committed by EOG down the road. In effect, EOG would have a license to act with

impunity viz the charges it makes against Lesikar’s interest.

       So too do we recognize that when obligations are ongoing (such as the duty to make

periodic payments of money), claims for their breach normally do not accrue until default

occurs. See Slusser v. Union Bankers Ins. Co., 72 S.W.3d 713, 717 (Tex. App.–Eastland

2002, no pet.) (stating that when a duty exists to make periodic payments, a separate

cause of action arises for each missed payment). And, without default, there is no claim.

This is of import when considered against the framework of the Rule 11 agreement at bar.

Again, the $22,500 was payment to resolve “allegations brought or which could have been

brought.” (Emphasis added). Claims that have yet to accrue when the settlement was

reached because default had yet to occur could not have been brought in the lawsuit.

Logic and rules of jurisdiction dictate that one cannot sue for damages arising from conduct

that has never occurred. And while parties can release unknown claims and damages that

arise in the future, Keck, Mahin & Cate v. National Fire Union Ins. Co., 20 S.W.3d 692, 698

(Tex. 2000), we hesitate to read such an expansive intent into a document lacking words

expressly indicative of such an intent and contemplating an ongoing business relationship.

       In short, that Lesikar was attempting to recover for overcharges that had been

assessed, that the business relationship between her and EOG was ongoing, and that

claims normally cannot be prosecuted until default occurs lead us to hold that EOG was

not insulated from suits regarding overcharges or misconduct occurring after the Rule 11

agreement at issue was executed. To the extent that the trial court held otherwise, it erred.

So too did it err if by requiring Lesikar to sign a “COPAS or other document indicating an

agreed lease overhead charge,” it sought to effectuate such a release. Yet, therein lies

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another problem for neither the “COPAS or other document” mentioned are part of the

record before us.1 Given that, we know nothing of their terms or effect. Nor do we know

whether their execution was “necessary . . . in order to finalize the dispute” given the

absence of evidence on the subject. Again, both EOG and Lesikar agreed to execute only

those documents deemed “necessary” to end the existing controversy. So, without

knowing the terms of the “COPAS or other document” and their impact on the dispute, we

can hardly say that EOG satisfied its summary judgment burden of proving, as a matter of

law, that their execution was necessary. Nor can we say that their execution was

unnecessary. Simply put, the issue remains an open question.

        Accordingly, we reverse the final judgment of the trial court and remand the cause

for further proceedings.



.                                                         Brian Quinn
                                                          Chief Justice




        1
         A COPAS does appear in the clerk’s record, but it does not appear to be the docum ent that EOG
is requesting Lesikar execute. A COPAS is also included in the appendix to EOG’s brief. However,
docum ents attached to a brief which are not a part of the official appellate record m ay not be considered by
the court. Randle v. W ilson, 26 S.W .3d 513, 515 n.1 (Tex. App.–Am arillo 2000, no pet.).

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