J a c k ie P a u l. 1 NO. 07-07 -007 3-CV

IN THE CO UR T OF APPEA LS FO R THE S EVEN TH D ISTRI CT O F TEXAS

AT AM AR ILLO PAN EL B OC TOBER16, 2008

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___ GOLD EN SPR EAD ELEC TRIC C OOPE RA TIVE, IN C. , Appel lan t
v. DE NV ERC ITYEN ER GY ASS OC IATES, L.P. ,

Appel lee

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______ FRO M T HE 10 8 DIS T RI CT COU RT OF P OT T ER COU NT Y; TH NO. 910 16-E; HON. ABE LOP EZ, PRESI DING

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____ Opinion

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

“W hen y ou’re wi nnin g, yo u make it easy, w hen y ou’re losing y ou m ake it hard, w hen y ou don’ t k now , y ou g iv e i t t o the j udg e, t hat’ s w hat l awy ers d o.” 1
W ith this ap pea l, the cou rt delves i nto the f ield of supp ly ing electrical energy , a f ield strew n w it h s uch conc epts and ter ms as “ PPA capac ity ,” “ re q uest ed energ y ,” “ re pla cementT he m ot i ons wer e f or par t i al sum m ar y j udgm ent but t he t r i al cour t sev er ed t he r em ai ni ng ca uses o f 2 a c ti o n a n d l a te r d i s p o s e d o f i s s u e s re g a rd i n g a tto rn e y ’ s fe e s a n d p re ju d g m e n t i n te re s t. 2 energ y ,” “ pow er

factor of 0.9 l ag g ing to .095 lea din g ,” “ spi nni n g reser v es, ” “c onv ersi on out age hou rs taken, ” “ ma trices a nd formu las,” “h eatrat es” with a ccom pan y ing fo rmula s, “Tota l Aug mented C apaci ty ,” “ fix ed capaci ty degradati on v alu e,” “si mple cy cl e,” “ combi ned cy cl e,” and other

v er bia g e sel dom encou ntered in the w ri ti ng s o f Di ck ens, Shak espea re , Prosser, or Corbin. Y et, it is the inte rpretat ion of such terms that und erlies the co ntroversy before u s. M or eov er , t hey and others a ppear in a c ontractbetw een G old en Spread Electric Coop erative, Inc. (Golde n) and Denver City Energy Associate s, L

. P . (Denver) under w hic h the l atter

ag re ed to su ppl y

el ect ri cal energ y

to the for mer. The pa rt ie s fil ed
cross -mot ion s for

su mmary

j udg ment, w h ich motions resul ted i n the tr ial co urt ent er ing jud gm e nt i n fav or

of Den v er

C it y . Si x

i ss ues now

aw aitco nsi derati on, a nd upon 2 address ing them as needed, w e aff ir m the jud g ment i n par t and rev erse iti n par

t. Spin ningReserves an d Their Sup ply Golde n initially

conte nds th at th e trial court erred in granting Denver’s no-e v iden ce moti on for summar

y jud g ment on the q uest ion of “s pin nin g reser v es. ” Al leg edl y , G old en pr esent e d so me ev ide nce il lus trati ng thatD env er fail ed to fulfil l it s o bli g ati on to prov ide them, and w e ag re e. “ Spi nni ng reser

v es” are not a condi ti on one enco unters a fter readi ng the appel lat e re cord and br iefs at ba r, thou g h bot h c oul d c a u se m in d s to sp in. R ather , ac cordin g to Golde n, the y

represen t electrical cap acity imm edia tely available to resp ond to an increa se in loa d rela ti v e to the g enerati on av ail abl e to ser v e l oad – suc h as oc curs w hen a pow er p l a n t e x p e r i e n c e s a s u d d e n fo r c e d o u t a g e
. F u rt h e r mo r e , w i t h o u t s u c h r e s e rv es, the3

sudd en loss of

a larg e po w er planton an intercon n e c t e d electrical sy stem can cau se
w ide spread bla ck outs , it cont inu ed. See Cente rpoint E nergy Ho usto n Elec., L LC v. PUC 212 S. W .3d 3 8 9 , 3 9 6 n.6 ( Tex . Ap p.–Aus ti n 2006, j udg m’t v acat ed w .r .m.) ( desc ri bin g “sp in n in g res e rves ” as a u ti lit y com p a n y’s m a in te nance req uirement i mp o se d by th e En e rgy Rel iab il it y

C ounci l of Tex as (E RC OT) or a li ke body w hic h re q uirement ob li g ates the uti li ty t o m a i n t a i n a re s e r

v e o f g e n e r a t i n g e l e c t r i c a l c a p a c i t y t h a tc a n b e u s e d i n t h e e v e n to f a sy ste m di stu rb ance or di sr upti on)

. Here, G old en al le ged , v ia it s “ Sev enth Amended Pet ition an d Am end ed Answ er to D ef end ant ’s Coun terclaim ” tha t Denver failed to comp ly
w it h i ts cont ra ctu al duty to prov ide su ch re ser

v es. The duty

i n q uest ion i s found i n ar ti cl e fiv e of the pur ch a se a gr eement ( PPA)
ex ecut ed by

the par ti es, w hic h ar

ti cl e i s e nti tl ed “ Pur chas e and Del iv er y ; D is patc h.” The
arti cl e beg ins by

des cr ibi ng the ag re ement o f D env er to “d eli v er

and sel l” to Gol den and Gol den’ s d uty

to “a cc ept a nd purc hase” the “P PA C apaci ty

. . . and the R eq uest ed Ene rg y .” Then, th e par

ti es sta te t hat t he “ Sel ler [D env er] ag re es, at n o addi ti onal co st to B uy er [Gold en] , to provide spinn ing reserves for the PPA Capa city as required to me et ap plicable
re q uirements for su ch r e ser v es. ” Gol den i nter pr ets thi s p ro v is ion to mean tha t D env er obl ig ated it sel f to prov ide sp inn ing reser v es free of ch arg e. Den v er , how ev er , reads itas an o bligation to provi de rese rv es “only if Golde n Sprea d is e v er re quired to me et ap plicable spinn ing reserve requirem ent s and w ill oth erw ise incur add itiona l cost to do so.” W hose int er pr etati on i s c or re ct depends upon appl ic ati on of con tract ual r ule s o f const ru cti on. Con str uin g an u nambig uous cont ra ct inv olv es a ques ti on of l aw
. In r e Waggoner Est ate , 163 S.W .3d 1 61, 165 ( Tex . Ap p.–Amar il lo 2005, no pet .)

. Thus, the s tandard of
rev iew is de n ovo , and w e are notbound by the int er pr etati on afforded t he documentby4

the t ri al cour

t. MC I T ele com m unicat

ion s Cor p. v. Tex

. Ut

il it ies Elec. C o., 995 S. W .2d 6 47, 650- 51 ( Tex . 199 9)

. But, l ik e the t ri al cour t’ s, our burden i s t o di sc ov er

and eff ect uate the int ent o f the par

ti es. Cr oss Ti m ber s Oi l Co. v. Ex

xon Cor p., 22 S. W .3d 2 4, 26 ( Tex . Ap p. –Amar il lo 2000, no pet .)

. Addi ti onal ly , t hat i ntentmustbe g ar ner ed from t he lang uag e of the c ontracti tse lf, w hic h l ang uage is co n sid e red i n i ts enti re ty

. Id. I n o t h e r wo rd s , we
re v iew the compl ete d ocumentto understa nd, h ar mon ize, a n d ef fectuate all of it s prov is ion s. Id. ; Ques ta Ener gy Cor p. v . Va ntage Poi

nt E ner gy, Inc ., 887 S. W .2d 2 17, 2 21 (Tex . Ap p.–Amar il lo 1994, w ri t den ied ). Au thor it y al so b in d s us t o afford the w ords cont aine d in the a greem entt heir plain, o rdinary, and genera lly accep ted mea ning, unle ss the i nst ru ment requi re s o ther w is e. Sun O

per ati ng Ltd. Par

tner shi p v . Holt , 984 S. W .2d 277, 285 (Tex . App.–Amar il lo 1998, pet. deni ed) ; Phi ll ips Petr ole umC o., v. Gi

ll m an, 593 S

. W

. 2 d 1 5 2 , 1 5 4 (T e x. Ci v. A p p
. –A m a ri ll o 1 9 8 0 , wri t re f ’d n
. r. e
. ). An d , m o s tim p o rt a n t ly,
w e may not re w ri te the ag re ement to mean someth ing it does not. Cr oss T im ber s O il C o.
v. Exxon C or

p., 22 S. W .3d a t 26; Bor der s v. KRL B, Inc. , 727 S. W .2d 3 57, 3 59 ( Tex . Ap p.– Amar il lo 1987, w ri t ref’d n. r. e.)

. W it h thi s sai d, it is ti me to address the prov is ion at is sue. Fi rs t, w e not e tha t t he l ang uag e deal ing w it h s pin nin g reser v es appears i n a par

t of the contractthat establ is hes the q uantum o f elec tr ic it y D env er i s t o g enerate a nd s ell and Gol den i s t o buy

. And, after the e xtent of the i nit ial obl ig ati on is d e sc ri bed, the p arti es add ress the m atte r of

spinnin g reserves. N ext, w e no te that the plain mea ning of the word “reser v e” c ontempl ates the ex is tenc e of a resource that g oes unuse d i n nor mal si tuati ons but n o nethel ess remains av ail abl e for ti mes of need. M ERR I AM -W EBST ER ’ S C O L L E G I A TE D I C T I O N A R Y 105 9 (11 ed. 20 03). T his interpre tat io n comp orts w ith w hatw as previously th5

allude d to as a spinn ing reserve, tha t is, it is a backup source of electricity

av ailable for use in the e v ent o f a sy ste m dis tur bance or dis ru pti on. And, it w as thi s back up re source that Den v er ag re ed “ to prov ide ” at “ no addi ti onal co st to” Gol den. Next, the p ro mis e to prov ide the re ser v e i s n ot w it h o u t lim itati ons. The l imi tati on most obv iou s i s i nherent i n the phrase “a s re q uired to meet appl ic abl e req uirements for
suc h rese rves .” That pass ag e rest ri cts the extent of Denv er ’s respon si bil it y to the g enerati on of those re ser v es needed to s ati sfy“ appl ic abl e req uirements ” impos ed on Gol den. In other

w ords, the duty

i mposed on Den v er eq ual ed th e dut y i mposed on Go lde n; for i nst ance, i f the latte r w as req uired to m ain tai n spinn ing reser v es eq ual to one k il ow att of elec tr ic it y , t hen D env er w oul d be re q uired to h av e i n reser v e onl y one ki low att of
e le ct ric it y. Mor e o ver, if th e ph ra se “ a t n o a d d it io n a l co stto Bu yer” is to ha ve a n y me a n in g, itca n onl y be re asona bly re ad as il lus trati ng Den v er ’s ag re ement t o make the one k il ow att of elec tr ic it y

av ail abl e w hen nee ded ati ts ow n ex pense
. So, in shor t, w e read parag ra ph 5.1 (C) as saying thatif Go lden is required to m ainta in spinn ing reserve s , De nver w ill prov ide them w it hout charg e butonl y to the e xtent of Gold en’ s o bli g ati on. Now , t he tr ial co urt read t he s ame parag ra ph as req uir ing Gol den t o first pay for spi nni ng reser

v es a n d then al loc ate a ny duty i t has to maint ain them among the other enti ti es from w hic h i t c an ac q uire el ect ri ci ty

. That c onst ru cti on r uns af o u l of ours

. It eff ect iv ely

co nvert s Den v er ’s promis e from on e of in it ial and ong oin g ac ti on to one of ind emnit y . That i s, itf re es Denv er of creat ing or

mai ntai nin g the re ser

v es in cas e Gol den
nee ds the m. Instea d, its obligation simply beco me s one of reimbu rsing Golde n for t he co st in c u rr e d in h a vin g t o f in d a n d d ip in t o a re s e rve cr e a t e d b y so m e o t h e r ge n e ra t in g fa c il it y. W hile som e ma y

see little dif

feren ce be tw een the tw o interp retat ions, tha t of the trial court6

neg ates the barg ain Gol den s oug ht i n bei ng ass ur ed that the re q uis it e re ser v es w oul d not onl y be a v ail abl e butal so be av ail abl e from on e par ti cul ar and cer tai n s our ce. Al so, w e find mis si ng from parag ra ph 5.1(C ) v er bia g e w hic h obl ig ates Gol den t o allocat e an y

requirem entit may hav e to ma intain spinnin g reserves amon g mu ltiple g enerati ng f aci li ti es. Ag ain , v ia that parag ra ph, D env er and no one els e, ex pr ess ly ag re ed “to provide spinnin g reserves fo r th e PPACapacity . . .” to the exten t tha t Golde n is “req uired to meet appl ic abl e req uirements for s uch re ser v es. ” And, bec ause nothi ng i n the prov is ion di re cts Gol den to allo cat e its needs among mul ti ple so ur ces , w e optnot to read
suc h an obl ig ati on i nto i t. Aga in, the lan g uag e i n the parag ra ph i s t he unambi g uous lan g uag e s ele cte d by

the par ti es; so w e c annot alt er i t. Fi nal ly , t he record c ontai ns the a ff ida v itof a Gol den officer w her e in h e av ers t hat De n ve r n e ve r pr o vid e d G o ld e n s p in n in g re s e rve s
. I n s t e a d , G o ld e n h a d t o ge n e ra t e it s o wn to meetappl ic abl e req uirements i mposed on i t, he conti nued. If bel iev ed, t his co nst it utes
som e evidence of

Denver’s failure to a bide bythe pro mise it mad e in p a ra grap h 5.1 (C). T h u s , t h e t ri a l c o u rte rr e d in co n c lu d in g t h a t t h e re wa s n o e vid e n c e o f b re a c h , a n d we sus tai n the poi nt. Who Can Com m it

or R eques t Elect

ricity Golde n ne xt f inds erro r in the trial court’s de claration thatSout hwestern Pub lic Ser v ic e ( SPS) had the sol e ri g ht t o c ommit and di spat ch ele ctr ic it y from M ust ang Sta ti on. W e di sag re e and ov er ru le the c omplai nt. Parag ra ph 5. 2 of the PPA sta tes that“ Buy er ’s di spat cher

. . . shall ha ve th e sole dis cr eti on to com mit[ ,] sche dule and dispat ch the PPA Cap acity.” (Emph asis add ed). Moreover, Golden and SPS execute d a do cum e n t e n t itled “Com mitm entand Dispatch7

Ser v ic e Ag re ement.” Therein , G old en req uest ed SP S “ to prov ide the commi tment and dispa tch service to Golden Sprea d for Mu stan g Sta tion. ” In respo nse, S PS sta ted thatit “is w illing to provide this serv ice und er the term s of” the Com mitm entand Dispatch Se rv ice Agreem ent . Per t h e l atte r agreem ent , the term “com mitm ent ” mea ns “a process which inv olv es deter mini ng w hic h av ail abl e g enerati ng uni ts ar e req uired to meet the for ecas ted Req uirements for t he next day , w hil e al so tak ing i nto a cc ount all re lev ant c onst ra int s.” “Dispatch” me ans “an aut om ate d proce ss w hich ut iliz es the low est costene rg y av ailable f rom th e com mitt ed reso urces to m eetthe con tinuo usly chan ging dem and , w hile also taking into acco untall relevant con straints. ” Upo n c ombini ng the pla in me a n in g of parag ra ph 5. 2 w it h the ter ms of the Golde n/S PS com mitm entand dispat ch con tract, we conclude thatGolde n ef fectively
v est ed SP S w it h “ sol e di sc re ti on” to re q uestenerg y under the PPA. That Den v er may not be a par ty to the Gol den/SP S acc ord is of no cons eq uence si nce the p ri v il eg e to del eg ate
w as that of Gold en Spread, not D env er ’s

. To the e xte n t t hat G old en q uest ion s t he tr ial co urt’ s fin din g that“ SPS

. . . has the sol e r ig ht to c o m m it a n d d is patc h M ust ang Sta ti on .
. . . [and] [i ]f SPS fai ls to commi t or dis patc h the Proje ct dur ing a ti me of unex cus ed out ag e, t her e i s n o R eq uest ed Ene rg y and therefore no R epl acementEnerg y obl ig ati on on the par t of [ Den v er

C it y ],” w e reje ct itas we ll

. A ga in , S P S wa s gi ve n t h e so le d is c re t io n t o co m m it , d is p a t c h , a n d sc h e d u le e n e rg y. Golde n ca nno t ig nore this delegatio n of auth orityev en if

SPS cho se no t to request ele ctr ic it y

from t he g enerati ng faci li ty

. In ot her w ords, i t mus t abi de by i ts ag re ement.T h e h e a t ra te i s a n e l e m e n t o f th e fo rm u l a u s e d to d e te rm i n e th e p a y m e n t d u e fro m G o l d e n to 3 D en v erf ore l ec t r i c en er gy
. Add i t i on al l y , t he t er m “ si m pl e cy cl e” c on no t es t he g en er at i on o fe l ec t r i ci t y v i a t wo com bust i on g ener at or s. I n cont r ast , t he t er m “ com bi ned cy cl e” connot es t he gener at i on of el ect r i ci t y t hr ough t he u se of

bot h t he com bust i on gener at or s and a st eam ope r at ed g ener at or
. T he st eam used t o op er at e t he l at t er gen er at or i s a by pr oduct der i v ed t hr ough t he o per at i on o ft he co m bust i on g ener at or s. 8 Appl ic able Heat R ate Next, Golden question s the trial court’s find ing that Denver could cha rg e Gold en via
a formula appl ic abl e to the g enerati on of energ y throug h “ si mple cy cl e” w hen i t ope ra ted Mu sta ng Sta ti on i n the “ si mple cy cl e” mode t houg h the faci li ty w as eq uip ped, at t he ti me, to opera te in combi ned c y cl e. Al leg edl y , D env er w as re q uired to us e c ombine d c y cl e heat 3
ra tes w hen det er mini ng the sums due w hen the f ail ure to operate i n c ombine d c y cl e w as unex cus ed. W e di sag re e and ov er ru le the i ss ue. As pr ev iou sl y menti oned, the int ent of t he par ti es usual ly is dete rmi ned by l ooki ng at the enti re ag re ement. But, thi s is not tr ue if a par ti cul ar prov is ion ex pr ess ly

address es the matter

. This i s s o bec ause the s peci fic c ontrols the g eneral. Ayres W eldingCo ., Inc.
v. Con oco, Inc ., 243 S.W .3d 177 , 181 (Tex. App. –Hou ston [ 14 Dist.] 2007 , pet . den ied). th And, su ch a prov is ion ex is ts her e. The par ti es enti tl ed App endi x 2, §5 of the PPA, “ PPA Hea t R ate D ur ing C ombine d Cy cl e C ommerc ial Operati ons Per iod .” Therein , t hey ag re ed th at: W hen t he Proje ct is operati ng i n s impl e c ycle mode, t he PP A H eat Rat e for each hour or por ti on thereof s hal l be det er mined in acc ordance w it h Sect ion 4 of

this App end ix

. W hen the Project is ope rating in comb ined cy cle mode, t h e PPA

H eat R ate for

eac h hour

or por ti on th er eof duri ng the Co m b in e d Cycle Co m m e rci a l Op e ra ti o n s P e rio d sh a ll b e d e te rm in e d th ro u gh the fol low ing st eps. As can b e see n, th e provision draw s a distinction between he at rate s w hen t h e f a c ility is operati ng i n s impl e v ersus combined cy cl e mode. So too d oes it des ig nate the for mulas to9

be u s e d in deriv ing the hea t rate w hen the facility ope rates in on e mo de o r the oth er. Moreover, noth ing i n the clause restricts the calculatio ns to situa tions involv ing fo rce majeure
or l ik e reason s for

operati ng i n s impl e c y cl e as oppos ed to combi ned c y cl e mode. N or does §4 of the same a ppendi x so rest ri ct the c alc ula ti on. Al so of note i s t he ti tl e ass ig ned to the sec ti on. The la ng uag e adopt ed, t hat i s, “P PA Hea t R ate Dur

ing C om bin ed C

ycle Com m er

ci a l O p er ati ons Per iod , ” ind ic ates thatthe par

ti es both understo od and int ended t hat t hey w er e g enerall y

di sc uss ing t h e m a nner

of deter mini ng heat ra tes after

M ust ang Sta ti on bec ame ca pabl e of o perati ng i n c ombine d c y cl e mode. (E mphasi s a dded)

. This , c ombine d w it h the ex pr ess ed lang uag e of §5 lea ds us to c oncl ude that itdi d notmatte r to t he par ti es w hy the facil it y

w as operati ng in sing le cy cl e mode after itw as capab le of opera ti ng in combined cy cl e. If itw as operati ng i n s impl e c y cl e, t hen t he heat ra te w as to “ be det er mined in acc ordance w it h Sec ti on 4 of this Appen dix .” W e mustbe c auti ous in impl y ing a t er m mis si ng from a w rit in g. Uni ver sal Health Ser vs ., Inc. , v. Renai

ss ance W

om en’ s G ro up, P .A., 121 S. W .3d 7 42, 7 47 ( Tex . 200 3) ( sta ti ng that a c our

t s houl d be caut iou s in impl y ing a cov enant to reflec t the parti es’ intent ). W e heed the c auti on and conc lud e tha t t he tr ial co ur t c or re ctl y

i nter pr eted the p ro v is ion

. Mi ti gati on by Golden Gol den next q uest ion s t he tr ial cour t’ s findi ng that it br eache d it s duty to miti g ate t he potent ial damag es suffer e d o r ex pense s i ncur re d by D env er w hil e meeti ng the ele ctr ic al demands of G old en. This i ss ue appa re ntl y rela tes to the s ale of ele ctr ic it y for w hic h D env er billed Go lden during the tim e Denver wa s o p e ra t ing i n simp le cy cle due to purp orted ly
unex cus ed out ag es. Ac cordin g to Gol den, the bil l shoul d hav e reflect ed rates appl ic abl e to ope rating in comb ined cy cle. Both Denver and the trial court b e li e ve d t h at th e rates wereW i t hi n t hi s i ssue, G ol den al so ar gues t hat som e of t he t r i al cour t ’ s decl ar at i ons wer e ov er l y br oad. 4 T he d ecl ar at i ons i n quest i on per t ai ned t o t he st at em ent s t hat 1) D env er “ cor r ect l y bi l l ed G ol den

. . . f or such e n e r g y [ i

. e. ene r gy pr oduced and sol d whi l e op er at i ng i n si m pl e c y cl e du e t o t he o ut age] base d up on Par agr aph 4 of Appendi x 2, ut i l i z i ng si m pl y cy cl e he at r at es” and 2) D env er “ cor r ect l y i nv oi ced G ol den

. . . f or al l ene r gy pr oduced b y the Pr oj ect

. . . . ” T hese f i ndi ngs, accor di ng t o G ol den, wer e t oo b r oad si nce t hey coul d be r ead as en com passi ng cl ai m s unr el at ed t o t ho s e av er r ed i n Denver ’ s pl eadi ngs. W e di sagr ee because i t was t hose pl eadi ngs t hat f r am ed t he sco pe o fr edr ess whi ch t he t r i al cour t coul d awar d, and t he fin d i n g s c a n a n d m u s t b e re a d a s o n l y a d d re s s i n g th e c l a i m s i n th o s e p l e a d i n g s
. See T EX
. R. C IV
. P. 301 ( r est r i ct i ng t he t r i al cour t ’ s abi l i t y t o gr ant m or e r el i ef t han t hat sought i n t he pl eadi ngs)

. T hus, t hey ar e l i m i t ed t o Denver ’ s dem and f or pay m ent fo r t he ener gy sol d t o G ol den whi l e D env er oper at ed i n si m pl e cy cl e m ode d u rin g F e b ru a ry o f 2 0 0 1

. 10 to be dete rmi ned v ia the for mula appl ic abl e to operati ng i n s impl e c y cl e mode ( w hic h rates
w er e hi g her ). G iv en our hol din g abov e tha t D env er w as enti tl ed to c harg e s impl e c y cl e rates
w hen r unni ng i n s impl e c y cl e, w e c onsi der thi s i ss ue moot and ov er ru le it

. 4 Prejud gm ent Inte rest Next, Gol den q uest ion s t he manner i n w hic h the tr ial co urt c alc ula ted p re jud g ment intere st. Th e trial court foun d tha t the parties ha d reach ed a n agreem enton the mat ter,
w hic h the y

had. H ow ev er , t he metho d olo g y ag re ed to w as mis appl ied by the cour

t,
acc ordin g to Gol den. W e ag re e butfor d ifferent re asons than thos e utt er ed by Gol den. The r ecord disc los es that the p arti es entered i nto a R ule 11 a g re ement w her ein they state d tha t any “ award of dam ages” or any “dam age award” w ould “bea r intere st at the Base Rat e as ( defined i n the PPA ) + 2% o n the l astday of the b anki ng month, co mpounded monthl y .” The Bas e R ate, as defined i n the PPA , means “ the b ase or pr ime len din g rate s et f rom tim e to time b y

T he Cha se Manh atta n Ban k, or its successor.” Golden interpret s these tw o prov is ion s a s req uir ing that pr eju dgm ent int er est be cal cul ated by deter mini ng w hat t he Cha se Ma nhatt an pri me rate w as at t he end of each mont h dur ing w hic h the debtremaine d unpai d, ad din g tw o percentto it , and then mul ti plyin g the sum by the amount o f debt to der iv e tha t mont h’s interest

. In effect, the rate c oul d v ar y eac h month in uni son w it h11

v ar ia ti ons of the C hase Ma nhatt an pr ime ra te. On the o ther hand, D env er

co ntends that pr eju dgm ent

i nterestw as to b e d e te rm in ed by tak ing the Cha se pr ime ra te ex is tent at t he end of the month i n w hic h the debtfirst beca me due, addi ng tw o percentto it , and then us ing t h a tsu m t o m u lt ip ly a ga in s tt h e o u t s t a n d in g d e b te a c h m o n t h

. Un d e r D e n ve r’ s m e t h o d o lo gy, the i nterestrate wo u ld re main cons tant. H ow ev er , nei ther i nter pr etati on of the Rul e 11 agreem entis correct. W e so con clude beca use th e formu la specif ied in thataccord per tai ned t o pos t-

jud g ment, as oppos ed to preju dg ment, int er est

. Rul e 11 ag re emen ts are l it tl e more tha n c ontract s rela ti ng to li ti g ati on. See D is ney
v. Gol lan , 233 S. W .3d 5 91, 595 (Tex . App.–D all as 2007, no pet .)

. As suc h, t hey are to be i n t e r p r e t e d i n t h e s a me ma n n e r a s a r e c o n t r a c t s i n g e n er al. Da llas C ounty v. Ris chon Dev elopm ent C or

p., 242 S. W .3d 90, 93 (Tex

. App.–D all as 2007, pet. deni ed)

. Thus, w e l ook to t he p la in m e a nin g of the w ords used to de ter mine the e xtent of the par ti es’ ag re ement. Cross Tim bers Oi

l Co. v. Ex

xon Cor p., 22 S. W .3d a t 26. Here, i t i s rather

cl ear thatthe par

ti es int ended to desc ri be a par ti cul ar i nterestrate throug h the R ule 11 ag re ement. Fur ther more, in so desc ri bin g it , t hey st ated that the rate
w as to ap ply

not to t he damag es w hic h may hav e ac cr ued butrather to the d amag e “ aw ard”
or the “a w ard” of damag es. Next, an “aw ard” is that sum pay abl e to one part y or another

as decre ed b y

the trial court. A s s uch, it does no t com e into ex istence until the trial court pronounc es or

ex ecut es jud g ment. Log ic all y , t hen, becau se the i nterestrate c ontempl ated in the Rule 11 agreem e nt w as to ap ply to th e sum aw arde d in the judgmen t, it could o nly hav e prospec ti v e appl ic ati on for no “ aw ard” ex is ted p ri or to the c our

t dec re ein g i t.12

In ot her w ords, the par

ti es did not sta te that the interestrate w as to app ly to damag es per se
. Rat her , t hey

sa id that itw as to apply to the “ aw ard,” w hic h means the sum de creed in the j udg ment. So, to the e xtent that the tria l cour t aw arded damag es, that“ aw ard” w as to accr ue interestat the Chas e pri me plus tw o perc ent “on the las t dayof the b anki ng month, compound ed month ly ,” not the damag es suffered bythe li ti g ant p ri or to the “ aw ard.” That the li ti g ants may

hav e i ntended othe rw is e does not matter si nce they , and w e, are bound by the u nambig uous lan g uag e adopt ed i n the ir ag re ement. Id. at 26 -2 7. How ev er , t his does not end t he matt er for it appears t hat i n c alc ula ti ng preju dg ment intere st the trial court ut iliz ed th e formu la cont aine d in the Rule 11 agreem ent , w hich formu la
w as ina p pli cabl e. Con seq uentl y , w hil e the reason ing behi nd Go lde n’s att ack upon the
c a lc u la t io n m a y b e wro n g, itis co rr e c tin a t t a c k in g t h e d e t e rm in a t io n
. S o , t o t h a te xt e n t , we sus tai n the i ss ue for the reason s w e di sc uss ed. Atto rn ey’ s F ees Golde n lastly atta cks the trial court’s aw ard of atto rney’s fees. It does so o n the basis that the c our

t e rre d in ul ti matel y

deny ing Gol den recov er y w hil e g ra nti ng D env er both damag es and dec larator y reli ef. Si nce w e found s ome er ro r in the tr ial cour t’ s deci si on and Den v er di d notprev ail to the extent decreed bythe tr ial court , the aw ard may be s ubj ectto modific ati on. See S tate Far mLloyds v. C .M.W., 53 S. W .3d 877, 893- 94 (Tex . Ap p.–D all as 200 1, pe t. de nied ) ( hold ing that a trial court ma y a w ard a prevailing party its atto rney’s fees). Con seq uentl y , w e s ust ain the is sue in par t. In s u m, t h o s e p o rt i o n s o f t h e t r i a l c o u rt ’ s p a rt i a l s u mm a r y a n d fi n a l j u d g me n t s 1) deny ing Gol den’ s c ontent ion thatD env er brea ched the P PA by

fail ing to prov ide sp inn ing
re ser v es at no co st, 2) aw ardin g D env er preju dg ment i nterest , and 3) aw ardin g D env er13

attor ney ’s fees in the amount g iv en are rev ersed and remanded t o the tr ial co urt. In all othe r thi ng s, the j udg ment i s a ff ir med.

Br ian Qui nn Chief Justice