IN THE SUPERIOR COURT OF THE STATE OF DELAWARE 

ZENITH ENERGY TERMINALS 

JOLIET HOLDINGS LLC, a Delaware 

Limited Liability Company, JOLIET 

BULK, BARGE & RAIL LLC, a 

Delaware Limited Liability Company,

Plaintiffs, 

v.

CENTERPOINT PROPERTIES TRUST,

a Maryland Real Estate Investment Trust,

Defendant.

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) C.A. No.: N19C-10-054 EMD CCLD 

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DECISION AFTER TRIAL

Submitted: March 12, 2024

Decided: July 29, 2024

Christopher Viceconte, Esquire, Gibbons P.C., Wilmington, Delaware, Patrick J. Lamb, Esquire, 

J’Aimee Crockett, Esquire, ElevateNext Law, Chicago, Illinois. Attorneys for Plaintiffs Zenith 

Energy Terminals Joliet Holdings LLC and Joliet Bulk, Barge & Rail LLC.

F. Troupe Mickler IV, Esquire, Randall J. Teti, Esquire, Ashby & Geddes, P.A., Wilmington,

Delaware, James D. Dasso, Esquire, Mason D. Roberts, Esquire, Jennifer S. Park, Esquire,

Zachary R. Kumar, Foley & Lardner LLP, Chicago, Illinois. Attorneys for Defendant

CenterPoint Properties Trust.

DAVIS, J.

I. INTRODUCTION

This is a breach of contract action assigned to the Complex Commercial Litigation 

Division of this Court. Plaintiffs Zenith Energy Terminals Joliet Holdings LLC (“Zenith”) and 

Joliet Bulk, Barge & Rail LLC (“JBBR”) (collectively, “Zenith” or the “Plaintiffs”) filed an 
2

Amended Complaint on September 10, 2021, against Defendants CenterPoint Properties Trust 

(“CenterPoint” or the “Defendant”) for breach of contract.1 

CenterPoint previously owned JBBR.2 CenterPoint, through JBBR, entered into 

contracts to design and build a crude-by-rail off-loading terminal in Joliet, Illinois (the 

“Terminal”).3 CenterPoint planned that the Terminal would receive, off-load, store, and 

distribute crude oil from the Mojo Pipeline.4

CenterPoint and Arc Terminals Joliet Holdings LLC (now known as Zenith Terminals 

Joliet Holdings LLC) entered into a Membership Interest Purchase Agreement (the “Purchase 

Agreement”).

5

 Under the Purchase Agreement, CenterPoint sold JBBR and, in effect, the 

Terminal to Zenith before the construction project on the Terminal was completed.6 Thereafter, 

Zenith, on behalf of JBBR, and CenterPoint negotiated a Construction Management Agreement, 

whereby CenterPoint was to continue to manage the construction project.7 Ultimately, the 

construction project was incomplete, not meeting alleged key requirements under the design and 

build plans.8 

Zenith filed suit, alleging CenterPoint breached the Purchase Agreement and the 

Construction Management Agreement. CenterPoint maintains no such breaches occurred.

II. PROCEDURAL BACKGROUND

On October 7, 2019, Zenith filed its original Complaint, asserting (1) breach of contract 

against CenterPoint under the Purchase Agreement between Zenith and CenterPoint, and (2) 

1 Amended Complaint (“Am. Compl.”), Sept. 10, 2021 (D.I. No. 89).

2 See id. ¶ 4.

3

Id. ¶ 3.

4

Id. ¶ 1.

5

Id. ¶ 4.

6

Id.

7

Id. ¶¶ 4-5.

8

Id. ¶ 6.
3

breach of contract against CenterPoint under the Construction Management Agreement between 

JBBR and CenterPoint.9 On November 9, 2019, CenterPoint filed its first Motion to Dismiss, or, 

in the Alternative, Motion to Stay the Action Pending Resolution of the Related Litigation (the 

Motion to Dismiss”).10 On January 28, 2020, the Court heard argument on the Motion to 

Dismiss.11 On February 14, 2020, the Court denied the Motion to Dismiss.12 On February 21, 

2020, CenterPoint filed its Answer and Affirmative Defenses.13 

On August 27, 2021, Zenith filed a Motion to Amend the Complaint under Delaware 

Superior Court Civil Rule 15(a),14 which the Court granted on September 9, 2021.15 Zenith filed 

the current Amended Complaint on September 10, 2021, which asserts the same two breach of 

contract counts as the original Complaint.16 CenterPoint thereafter filed its Answer and 

Affirmative Defenses on September 24, 2021.17 CenterPoint then filed a Motion to Amend the 

Answer (the “Motion to Amend”) to assert counterclaims on the same day.18 The Court heard 

argument on the Motion to Amend on October 18, 2021,19 and denied the Motion to Amend on 

January 7, 2022.20 

On August 5, 2022, Zenith filed a Motion for Summary Judgment, seeking judgment in 

its favor on both counts as to liability and requesting a trial as to damages.21 Also on August 5, 

2022, CenterPoint filed its own Motion for Summary Judgment, requesting judgment in its favor 

9 See Original Complaint (“Original Compl.”), Oct. 7, 2019 (D.I. No. 1).

10 See Defendant’s First Motion to Dismiss (“First Mot. to Dismiss”), Nov. 19, 2019 (D.I. No. 9).

11 See Judicial Action Form, Jan. 28, 2020 (D.I. No. 25).

12 See Order, Feb. 14, 2020 (D.I. No. 27).

13 See Answer, Feb. 21, 2020 (D.I. No. 28).

14 See Motion to Amend Complaint, Aug. 27, 2021 (D.I. No. 86).

15 Order, Sept. 9, 2021 (D.I. No. 88).

16 See Am. Compl.

17 See Answer, Sept. 24, 2021 (D.I. No. 90).

18 See Motion to Amend Answer, Sept. 24, 2021 (D.I. No. 91).

19 See Judicial Action Form, Oct. 18, 2021 (D.I. No. 94).

20 See Order, Jan. 27, 2022 (D.I. No. 105).

21 See Plaintiffs’ Motion for Summary Judgment (“Pls.’ Mot. for Summ. J.”) (D.I. No. 131).
4

on both counts in the Amended Complaint.22 The Court heard argument on those Motions on 

October 28, 2022 and took the Motions under advisement at the conclusion of the hearing. The 

Court denied the Motions for Summary Judgment on January 23, 2023 (the “Opinion”).

23

The Opinion resolved substantially all of the legal issues between the parties. The Court 

held that Delaware’s applicable statute of limitations did not bar Zenith’s breach of contract 

claims—i.e., Count I and Count II.24 The Court also addressed issues of contract interpretation. 

The Court held that the Purchase Agreement and the Construction Management Agreement were 

unambiguous.25 The Court will not readdress these legal issues as part of this Decision. The 

Court notes that nothing presented during the Trial (as defined below) would cause the Court to 

change any holding as to a legal issue addressed in the Opinion—e.g., that the statute of 

limitations bars Zenith’s claim or that the contracts were ambiguous. Finally, the Court found 

that genuine issues of material fact existed as to: (i) “Final Completion;”26 (ii) whether 

CenterPoint breached Purchase Agreement Section 6.16(a);27 and (iii) whether CenterPoint 

breached Construction Management Agreement Section 2(b).28 

III. THE TRIAL

The Court held a bench trial on Zenith’s claims from July 5, 2023 through July 7, 2023 

and again on August 21, 2023 (collectively, the “Trial”).29 The Court then had both parties 

22 See Defendant’s Motion for Summary Judgment (‘Def.’s Mot. for Summ. J.”) (D.I. No. 139).

23 Zenith Energy Terminals Joliet Holdings LLC v. CenterPoint Properties Trust, 2023 WL 615997 (Del. Super. Jan. 

23, 2023).

24 Id. at *8-9.

25 Id. at *9-11.

26 Id. at *12 (“Final Completion” as defined below).

27 Id. at *11-12.

28 Id. at *12-14.

29 Civil Trial Activity Sheet (D.I. No. 186).
5

submit their closing arguments in written form, receiving the final post-trial paper on or about 

November 20, 2023.30 The Court then held closing arguments on November 28, 2023.31

A. WITNESSES

During the Trial, the Court heard from and considered testimony from the following 

witnesses:

Gavin Palmer

Tony Henshaw

Ira Hanan

Douglas Haduch

Steven Schnitzer

Eric Gilbert

Michael Murphy

Robert David Vinson 

All the witnesses testified on direct and were available for cross-examination. The fact 

witnesses in this civil action were Mr. Haduch, Mr. Schnitzer, Mr. Gilbert and Mr. Murphy. The 

expert witnesses were Mr. Palmer,32 Mr. Henshaw,33 Mr. Hanan34 and Mr. Vinson.35 The parties 

agreed not to admit the various expert reports into evidence. 

Normally, the Court would list the witnesses in the order they testified and which party 

called the witness; however, because the Trial was a bench trial, the Court could take witnesses 

out of order. In addition, the Court allowed for examination of each witness in both parties’ 

case-in-chief pursuant to Delaware Evidence Rule 611. 

Brian Sheehan, CenterPoint’s appointed Construction Manager for JBBR, did not testify 

at the Trial. No representatives from Ragnar Benson Construction LLC (“Ragnar”) or Wilson & 

30 D.I. No. 201.

31 D.I. No. 202.

32 Mr. Palmer testified and rendered his opinions on July 5, 2023.

33 Mr. Henshaw testified and rendered his opinions on July 5, 2023.

34 Mr. Hanan testified and rendered his opinions on July 5, 2023.

35 Mr. Vinson testified and rendered his opinions on August 21, 2023.
6

Company, Inc. Engineers & Architects (“Wilson”) testified at the Trial. Deposition testimony 

has been used in some instances in lieu of live testimony.

B. CREDIBILITY OF WITNESSES

Here, the Court is the sole judge of each witness's credibility, including the parties.36 The 

Court considers each witness's means of knowledge; strength of memory; opportunity to 

observe; how reasonable or unreasonable the testimony is; whether it is consistent or 

inconsistent; whether it has been contradicted; the witnesses’ biases, prejudices, or interests; the 

witnesses’ manner or demeanor on the witness stand; and all circumstances that, according to the 

evidence, could affect the credibility of the testimony.37

The Court finds that—based on their testimony at the Trial and the factors listed above—the 

witnesses that testified were generally credible. All witnesses had some form of relationship to 

the parties and the Court accounted for that bias. The Court, however, believes that the 

witnesses were not evasive, nor did they provide testimony that was not somehow supported by 

other evidence. While the Court finds that the witnesses were generally credible, the Court gave 

more weight to some testimony based on evidence supporting that testimony. For example, the 

Court found Mr. Vinson to be credible but did not give his testimony as much weight as other 

experts due to certain evidentiary facts regarding Mr. Sheehan’s conduct. 

C. EXHIBITS

The parties submitted an extensive number of exhibits. Most of these exhibits were 

admitted without objection. The parties provided the Court with the exhibits in the form of joint 

exhibits (“JX”). The exhibits numbered JX1-1511. 

36 See Superior Court Civil Pattern Jury Instruction 23.9.

37 Id.
7

IV. FACTUAL FINDINGS

A. THE PARTIES

Zenith is a Delaware limited liability company formerly named Arc Terminals Joliet 

Holdings LLC (“ARC”).

38

 Arc contracted with CenterPoint under the Purchase Agreement to 

purchase JBBR.

39

 As stated above, JBBR controls the Terminal. To avoid confusion, the Court 

will refer to Zenith in this Decision, but the Court (and the parties) consider Arc and Zenith to be 

the same entity. 

CenterPoint is a “Maryland real estate investment trust” that “acquires, develops, 

manages and leases warehouse, distribution and manufacturing facilities near major 

transportation nodes and is an expert in large rail infrastructure assets.”40 CenterPoint was the 

owner of the Terminal prior to the execution of the Purchase Agreement.41 Additionally, 

CenterPoint managed the continuing construction of the Terminal post-sale under the 

Construction Management Agreement.42 

JBBR is a Delaware limited liability company formed by CenterPoint on or around 

November 9, 2011.43 CenterPoint, through JBBR, negotiated contracts to design and construct 

the Terminal.44 JBBR has owned the Terminal and, by extension, the construction project at all 

times relevant to this action.

45

 On May 14, 2015, CenterPoint sold JBBR to Zenith (still known 

as Arc Terminals at the time) under the Purchase Agreement.46 

38 Id. ¶ 8.

39 Id.

40 Id. ¶ 10.

41 Id. ¶¶ 2-4; see also Pls.’ Mot. for Summ. J. at 2.

42 Am. Compl. ¶ 4.

43 Id. ¶ 9; Pls.’ Mot. for Summ. J. at 2.

44 Pls.’ Mot. for Summ. J. at 3; Def.’s Mot. for Summ. J. at 5.

45 Am. Compl. ¶ 9.

46 Id. ¶ 11.
8

B. PLANNING AND DEVELOPMENT OF THE TERMINAL

In 2013, CenterPoint determined to develop land it owned into a crude-by-rail offloading 

facility.

47 CenterPoint began this process by engaging Wilson to design the facility. On April 

16, 2014, Wilson and JBBR entered into a Master Services Agreement (“MSA”).48 The MSA 

tasked Wilson with providing design, engineering, and construction oversight on the construction 

project.49 Additionally, Wilson entered into various task orders that provided details on the 

scope of work for the construction project.50 

CenterPoint then engaged in negotiations with ExxonMobil Oil Corporation (“Exxon”).51 

Exxon owned and operated an oil refinery near CenterPoint’s development site.52 On May 28, 

2014, JBBR and Exxon entered into the Terminal Services Agreement (the “TSA”).53 JBBR was 

then a wholly owned entity of CenterPoint. 

The TSA was a “take or pay” contract, meaning Exxon was required to make regular 

minimum payments even if Exxon did not need a specified number of trains unloaded for the 

requisite period.54 TSA Section 7.5 provides: “[Exxon] shall be obligated to pay the Monthly

Committed Payment...regardless of whether [Exxon] in fact delivers all or any of the Committed 

Volume....”55 

The TSA required that the Terminal be available at all times except “short periods of time 

due to routine maintenance and repair.”56 Mr. Gilbert testified that an “essential element” of the 

47 Aug. 21 Tr. 9:4-16.

48 JX3.

49 Id. 

50 Id.

51 Aug. 21 Tr. 9:17-10:7.

52 Id.

53 JX25.

54 Id. §7 (“Volume and Fees”) and §7.5.

55 Id. § 7.5.

56 Id. § 2.8.
9

TSA was the Terminal’s capability to steam and unload a unit train (120 railcars) within 24 

hours, including that part of the year between October 1 and March 31.57

On August 26, 2014, Ragnar and JBBR entered into a Construction Contract.

58

 Under 

the Construction Contract, Ragnar was the engineering, procurement, and construction contractor 

on the construction project.59 Ragnar purportedly “agreed to construct the Terminal in 

conformity with [s]pecifications and the provisions of the Construction Contract.”60

C. THE PURCHASE AGREEMENT AND THE CONSTRUCTION CONTRACT

Shortly after entering the Construction Contract, however, CenterPoint decided to sell the 

Terminal.

61

 CenterPoint hired Wells Fargo to broker the sale and considered several prospective 

purchasers.62

Zenith sought to purchase the Terminal. CenterPoint did not accept Zenith’s initial 

proposal to purchase the Terminal. However, after CenterPoint failed to obtain a better purchase 

proposal CenterPoint re-engaged with Zenith.

63

 On December 14, 2014, Zenith submitted a 

letter of intent to acquire the membership interests of JBBR from CenterPoint.64

On February 19, 2015, after a brief due diligence period, Zenith and CenterPoint entered 

into the Membership Interest Purchase Agreement—i.e., the Purchase Agreement.

65 Zenith

purchased JBBR from CenterPoint for $216 million, plus $27 million in deferred payments, for 

57 Aug. 21 Tr. 44:16-45:19.

58 JX1.

59 Id.; JX2.

60 Def.’s Mot. for Summ. J. at 8-9.

61 Id. 22:1-23:21.

62 Id. 22:1-23:21; 24:2-8.

63 Id. 24:2-8.

64 JX19.

65 JX20.
10

an aggregate amount of $243 million.66 The parties completed closing on May 14, 2015.67 On 

May 14, 2015, therefore, Zenith became JBBR’s parent company.68 

The Terminal was still under construction when Zenith and CenterPoint entered into the 

Purchase Agreement.69 Zenith had no experience with the construction of a project like the 

Terminal.70 Moreover, Zenith had no prior relationship with Ragnar or Wilson.71 CenterPoint 

had the needed construction experience and relationships with critical vendors.72 The parties 

memorialized this in Section 6.15(a) of the Purchase Agreement, titled “Final Completion,” 

which states:

After Closing, on and subject to the terms of the Construction Contract [with 

Ragnar] and the Construction Management Agreement, [CenterPoint] shall use its 

reasonable best efforts to achieve, and to cause the EPC Contractor [Ragnar] (and 

any other applicable third party contractors or service providers) to achieve, Final 

Completion in accordance with the Approved Cost Plan and the Project Schedule 

and otherwise in accordance with the terms and conditions of the Construction 

Contract and the Construction Management Agreement in all material respects.73

In the Purchase Agreement, “Final Completion” is defined as “the meaning given in the 

Construction Contract.”74 The Construction Contract between JBBR and Ragnar, dated August 

26, 2014, defines “Final Completion” as:

[T]hat point in time in the progress of the Work after Mechanical Completion when 

(a) the Work has been completed and is operational; (b) all testing (including 

hydrotesting) and coating is complete; (c) all pipe, valves, and Equipment 

installation and tie-ins are complete; (d) all essential Equipment and lines have been 

hydrotested and had a geometry tool run through them; (e) the Work is capable of 

transporting refined products in a safe uninterrupted manner 24 hours per day, 

seven days per week without further anticipated shutdowns, except for preventative 

maintenance; (f) and all other requirements of this [Construction Contract] with 

66 Am. Compl. ¶ 4; JX20.

67 JX29.

68 Pls.’ Mot. for Summ. J. at 11; Def.’s Mot. for Summ. J. at 5.

69 JX20; JX5.

70 Cubbage Dep. 33:2-34:24; 103:22-104:23.

71 Id.

72 Aug. 21 Tr. 27:19-28:18.

73 JX20 § 6.15(a) (emphasis added).

74 Id. at Annex I.
11

respect to Final Completion ([including those set forth in Construction Contract 

Exhibit A]) have been satisfied.75

The Construction Contract defines “Work” to

[M]ean all of [Ragnar’s] obligations, duties and responsibilities under this 

[Construction Contract], including the design, engineering, procurement, 

manufacturing, supply, installation, erection, construction, commissioning, and 

testing of the Facilities, all work and services described in Exhibit A and all 

Warranty Work.”76

Exhibit A of the Construction Contract sets out the “Minimum Requirements for Final 

Completion” and defines them as:

(a) Final Completion includes, at a minimum, the following: (i) any liquidated 

damages payable by [Ragnar] to [JBBR] pursuant to th[is Construction Contract] 

have been paid and/or satisfied; (ii) [Ragnar] has completed all the Work required 

by this [Construction Contract]; (iii) [Ragnar] has executed and delivered to [JBBR] 

and [JBBR] has accepted the lien waiver . . .; (iv) [Ragnar] has provided the final 

close-out report to [JBBR]; (v) there are no outstanding claims or disputes as 

between [Ragnar and JBBR]....

77

Exhibit A additionally required that “any liquidated damages payable by Contractor to 

Company pursuant to the Agreement have been paid and/or satisfied” and that “there are no 

outstanding claims or disputes between the Parties.”78

The Construction Contract also required Final Lien Waivers from the Contractor and all 

subcontractors be provided to and accepted by JBBR before Final Completion was achieved.79

D. THE CONSTRUCTION MANAGEMENT AGREEMENT

In tandem with the Purchase Agreement, Zenith and CenterPoint executed the 

Construction Management Agreement on May 14, 2015.

80

 The Construction Management 

75 Am. Compl., JX1 § 1.1.

76 Id. § 1.1 (underlining in original).

77 Id. at Ex. A.

78 Id.

79 Id. at Ex. E.

80 JX6.
12

Agreement made CenterPoint the agent of JBBR,81 and it states that “[JBBR] has requested that 

[CenterPoint] provide certain construction management services to [JBBR] . . . for a limited 

period following the Closing Date, and [CenterPoint] has agreed to provide such services.”82 

Construction Management Section 2(a), titled “Construction Management Services,” 

states:

Subject to the terms of this Agreement, [CenterPoint] agrees to provide to [JBBR] 

and [JBBR] agrees to accept from [CenterPoint], the construction management 

services described on Schedule A . . .. [JBBR] hereby (i) [appoints CenterPoint as 

its agent for all purposes] under the Construction Contract [and CenterPoint 

accepts], and (ii) authorizes [CenterPoint] to take all actions on behalf of [JBBR] 

that [CenterPoint], in [CenterPoint]’s sole and good faith discretion, considers 

reasonably necessary to provide the Services, including all invoices, payments, 

change orders and certifications under the Construction Contract; provided that 

[CenterPoint] shall (A) obtain [JBBR]’s prior written consent (which shall not be 

unreasonably withheld, conditioned or delayed) before (1) issuing the Final 

Completion Certificate (as defined in the Construction Contract) and making 

payment therefor.83

Construction Management Agreement Schedule A states that “[CenterPoint] shall 

manage EPC Contractor’s [Ragnar’s] performance and completion of the Work under the 

Construction Contract until the Final Completion Certificate is issued and accepted by [JBBR] 

thereunder and payment is made therefor.”84

Construction Management Section 2(b) is also referenced. Section 2(b) provides:

[CenterPoint] shall perform the Services with substantially the same standard of 

care (including quality) as the Services were performed by or on behalf of [JBBR] 

prior to the Effective Date, including, without limitation, by performing the 

Services, at all times, as would a reasonably prudent construction manager in the 

construction management industry.85

81 Id.

82 Id. at Recitals.

83 Id. § 2(a) (underlining in original).

84 Id. at Schedule A.

85 Id. § 2(b).
13

Construction Management Agreement Section 2(h) limits the obligations under Section 2, 

and it provides that “except as expressly set forth in Section 2, no representations, warranties or 

guaranties of any kind, express or implied . . . are made by [CenterPoint] with respect to the 

services provided under [the Construction Management Agreement],” and that all representations 

and warranties are waived and disclaimed to the fullest extent of the law.86

E. EVENTS AFTER EXECUTION OF THE AGREEMENTS AT THE TERMINAL

1. Final Completion was not achieved.

The record on Final Completion is one created by JBBR and CenterPoint. CenterPoint’s 

decision (and contractual right)

87 to litigate its issues with JBBR in Delaware and not participate 

in the Illinois Action88 means that the participation of Ragnar and Wilson was, at best, limited. 

From the record at Trial, the Court finds, by a preponderance of the evidence, that Final 

Completion was never achieved by Ragnar.

JBBR and Ragnar certified and agreed that conditions for Mechanical Completion had 

been satisfied. On April 30, 2015, JBBR and Ragnar signed the Mechanical Completion 

Certificate.89 The Mechanical Completion Certificate provides that all conditions for Mechanical 

Completion had been satisfied.90 In addition, the Mechanical Completion Certificate provided:

Notwithstanding the issuance of the issuance of this Mechanical Completion 

Certificate, [Ragnar] shall not be relieved of any obligations under the 

[Construction Contract] or at law that survive the issuance of this Mechanical 

Completion Certificate.91

86 Id.§ 2(h).

87 JX6 § 11(h); JX20 § 12.10(a).

88 The Illinois Action is defined and discussed below.

89 JX5.

90 Id.

91 Id.
14

The Construction Contract initially required Final Completion to be achieved by March 

15, 2015.92 Ragnar first requested to extend the date to July 1, 2015.

93

 Ragnar then asked to 

extend Final Completion until September 30, 2015.

94

 Ragnar finally asked to extend the Final 

Completion Date until October 16, 2015.95 JBBR (through CenterPoint) approved each of 

Ragnar’s requests. 

The change order submitted by Ragnar, approved by CenterPoint and then by JBBR, 

cited the lack of trains as one reason for extending the Final Completion date.96 Specifically, the 

October 9, 2015 request from Pablo M. Hernandez of Ragnar reads as follows:

Dear Eric [Gilbert],

JBBR’s executed Change Order Request #15 previously extended the dates for 

Mechanical Completion to April 16, 2015 and for Final Completion to July 1, 2015. In 

accordance with the aforementioned change order request, Mechanical Completion was 

achieved on April 16, 2015. However, due to several factors beyond Ragnar Benson’s 

control, we are hereby requesting an extension to the Date for Final Completion from 

July 1, 2015 to October 16, 2015. 

Factors which contributed to the delayed Date for Final Completion include, but are not 

limited to the following:

• Delays in Train Schedules.

Start-up and commissioning were completed in order to satisfy Mechanical Completion, 

however, certain items required additional commissioning efforts beyond the first couple 

of trains. The delays in train schedules delayed the additional commissioning efforts 

which impacted the critical path for Final Completion.

• Added Scope Items.

Scope items were added to Ragnar Benson’s contract which also directly affected the 

critical path for Final Completion. Please reference Change Order Request #17 R-2. 

Increased scope items included, but were not limited to, Pipeline Cathodic Protection, 

heat trace redesign (added pumps and structural supports) and industrial waste 

monitoring.97

92 JX1460.

93 Id.

94 JX1457.

95 JX1408.

96 Id.

97 Id.
15

The evidence at Trial shows that, as of October 9, 2015, Ragnar, CenterPoint and JBBR 

agreed that Mechanical Completion had been achieved and that Final Completion had not been 

achieved. The reasons why the Date of Final Completion needed to be extended were “delays in 

train schedules” and “added scope items.”

On October 16, 2015, Ragnar delivered its request for Final Completion to Michael 

Murphy of CenterPoint.98 Mr. Sheehan, CenterPoint’s Construction Manager for the Terminal, 

forwarded the request to JBBR requesting JBBR’s approval.99

Ragnar’s certification for Final Completion was signed by Ragnar’s project manager, Mr. 

Hernandez. Mr. Hernandez did not have personal knowledge as to the facts and executed a letter 

provided by David Bergstrom, Ragnar’s Senior Vice President.100

The record reflects that Ragnar did not satisfy the Exhibit A Construction Contract’s lien 

waiver requirement.101 For example, Ragnar did not obtains final lien waivers from Wilson or 

Mechanical, Inc., the entities responsible for commissioning the steam condensate system.

102

 

The record also indicates that other waivers were missing as well.103

As Construction Manager, Mr. Sheehan would have known the identity of Ragnar’s 

subcontractors.104 The record is incomplete on whether Mr. Sheehan (or CenterPoint) did 

anything to verify the accuracy of Ragnar’s representations regarding any lien waivers or any 

other aspect of its “Certification.” Testimony indicated that CenterPoint believed that Final 

Completion could be achieved by completion of items on Ragnar’s punch lists.

105

 

98 JX7.

99 JX10.

100 Hernandez Dep. 35:14-37:21.

101 JX1 at Ex. A.

102 JX8.

103 JX150 (Ragnar informing Chicago Title Ins. Co. of missing final lien waivers).

104 July 5 Tr. at 167:1-170:12.

105 Aug. 21 Tr. at 40:10-15; Aug. 21 Tr. at 86:20-88:20.
16

Ragnar knew commissioning the steam condensate system was a prerequisite to Final 

Completion.106 Final Completion, in part, means that point in time after Mechanical Completion 

when the “Work has been completed and is operational.” Work is defined as meaning all 

Ragnar’s obligations including commissioning and testing of the Terminal.107 

Ragnar engaged Wilson as its subcontractor to commission the system.108 Ragnar and 

Wilson entered into the MSA109 and after agreeing to a change order, Wilson was to “provide 

design/engineering support of the verification/commissioning of the steam/condensate, hot oil 

and inbound crude systems.”110 Wilson’s invoices to Ragnar indicated that commissioning was 

not attempted until March through May 2016—a date after Ragnar’s Final Completion 

request.111 As such, Ragnar should have known that commissioning was not done prior to its 

requesting Final Completion. 

CenterPoint, as Construction Manager, 112 knew or should have known that the system 

had not been commissioned when Ragnar requested Final Completion.113

Mr. Haduch, JBBR’s terminal manager, communicated to Mr. Sheehan the lack of 

commissioning on October 7, 2015, in an email stating Mr. Haduch believed the system had not 

been commissioned.114 Moreover, on October 27, 2015, Mason Whipple, Wilson’s senior 

project engineer who designed the steam condensate system, responded to Mr. Haduch, copying 

Mr. Sheehan, noting that “steam needs to be commissioned under load.”115 

106 JX1§ 1.1.

107 Id.

108 JX1400.

109 Id.

110 JX151.

111 JX1401; JX1402; Jx1403; JX1404.

112 JX20, § 6.15(a); JX6, §2(a)-(b).

113 July 5 Tr. at 149:12-150:6; 158:17-161:16; 166:20-167:18; 214:21-215:16.

114 JX1180.

115 Id.
17

There is no evidence that Mr. Sheehan notified Steven Schnitzer, JBBR’s General 

Counsel, of the lack of commissioning before Mr. Schnitzer submitted JBBR’s response to 

Ragnar on October 29, 2015. As such, JBBR’s response to Ragnar denying the request for Final 

Completion necessarily focused on deficiencies with the hot oil system.116

Evidence at Trial shows that the Terminal did not function properly. Mr. Haduch 

testified that the “hot oil system was problematic essentially from the day it was commissioned” 

and there were “a number of seal failures on a fairly regular occurrence where these booster 

pumps [would] blow their seals” leaving thermal oil on the ground.117 Moreover, the pump seals 

repeatedly failed on the thermal booster oil pumps.118 Mr. Haduch also testified (and Ragnar 

acknowledged) that two years into operations, JBBR had to “replace the same seal that keeps 

failing time and time again.”119

The record supports the conclusion that steam condensate system deficiencies were not 

discovered until the parties attempted to commission the system. Mr. Haduch testified the 

steam/condensate system had multiple issues that became apparent from its first cold weather 

use.120 At an attempted offloading on February 10, 2016, he observed “poor unloading rates” 

because “[t]he temperature of the oil [in the railcars] wasn’t hot enough, and we had just a very 

difficult time getting the crude oil ... unloaded from the railcars.”121

Issues with the system continued into February and March.122 The problems involved 

both the condensate system and the boilers.123 Eventually JBBR and Wilson came up with an 

116 JX11.

117 Aug. 21 Tr. at 31:14-32:17.

118 Aug. 21 Tr. at 39:18-22.

119 Aug. 21 Tr. at 48:3-9. See also JX1125 (Ragnar acknowledging the issue but disagreeing that it applies to “Final 

Completion”).

120 July 6 Tr. at 50:2-5.

121 July 6 Tr. at 50:2-5. See also JX1421.

122 July 6 Tr. at 54:13; JX1421; July 5 Tr. at 57:4-16; JX1185; July 6 Tr. at 62:8-11; JX1117.

123 July 6 Tr. at 65:22-66:18.
18

ad hoc solution where the system was fueled by a local city fire hydrant with a fire hose to use 

city water.124 Despite JBBR’s and Wilson’s attempts at a solution, there was another train 

steaming failure on March 8, 2016.125

Another issue involved the deaerator and an oversized 10-inch butterfly valve that failed 

to allow proper deaeration.126 As such, the failure to deaerate negated the benefits of chemical 

treatment and contributed to boiler degradation.127 JBBR repeatedly experienced issues with the 

deaerator overflowing and flooding rooms, including the boiler room.128 Attempts to address the 

issue with modified drains failed.129 In addition, Wilson’s design utilized rubber hoses that were 

not appropriate for cold weather unloading.130

The problems with the steam condensate system continued without resolution into 

2017.131

The Court’s factual conclusions regarding “Final Completion” are supported by the 

testimony of experts concerning the work done and problems with the Terminal: (i) Mr. 

Henshaw’s testimony;132 (ii) Mr. Hanan’s testimony;133 and (iii) Mr. Palmer testifying that Final 

Completion had not happened given the deficiencies in steam and condensate system, including 

124 July 6 Tr. at 65:22-66:18 (Mr. Haduch testified about “...going to a local city fire hydrant with fire hose and 

filling up this 1800-foot-long pipe with city water... so that condensate would return to our DA.”).

125 July 6 Tr. at 69:2-4; JX1187.

126 July 6 Tr. at 71:17-72:16; JX1088.

127 July 5 Tr. at 53:12-54:18.

128 July 6 Tr. at 73:8-74:1-8 (flooding into area containing medium voltage cabinet cause dangerous situations); July 

5 July 5 Tr. at 52:2-53:1.

129 July 6 Tr. at 73:8-74:1-8.

130 July 6 Tr. at 80:3-82:12.

131 July 6 Tr. at 76:7-77:11; JX155 (notes indicating slugging and overflow issues).

132 July5 Tr. at 100:10-133:4 (includes testimony on problems at terminal and design flaws).

133 July 5 Tr. at 159:19-172:20 (Ragnar should not have requested a Final Completion certificate because the system 

had not been successfully commissioned). 
19

the inability of the system to operate in any reliable manner.134 CenterPoint did not provide any 

expert testimony on whether Final Completion had been achieved.135

2. CenterPoint failed to use reasonable best efforts.

The Court has found that Final Completion was not achieved. The next factual question 

is whether CenterPoint used its reasonable best efforts to achieve or cause Ragnar to achieve 

Final Completion. The Court finds, by a preponderance of the evidence, that CenterPoint failed 

to use reasonable best efforts. Central to this finding is the unusual conduct of CenterPoint as 

agent to JBBR. The Construction Management Agreement provides that CenterPoint is the agent 

of JBBR.136 In addition, the Construction Management Agreement states that CenterPoint needs 

to exercise “good faith discretion” when providing Services under this agreement.137

The evidence at Trial showed that CenterPoint appeared to be assisting Ragnar and 

Wilson instead of its principal, JBBR. The Court could come to no other conclusion given the 

failure of Mr. Sheehan to testify and explain his conduct in 2015 and 2016.

CenterPoint had two separate obligations under Purchase Agreement Section 6.15: (i) to 

“use its reasonable best efforts” to achieve Final Completion, and (ii) to “cause the EPC 

Contractor [Ragnar] (and any other applicable third-party contractors or service providers) to 

achieve Final Completion.”138 According to testimony, EPC Contractor means a contractor with 

engineering, procurement, and construction responsibilities, rather than simply construction 

responsibilities.139

Mr. Sheehan acted as the Construction Manager for the Terminal.140 

134 July 5 Tr. at 62:19-65:1.

135 See, e.g. Aug. 21 Tr. at 147:15-21.

136 JX6, §2(a)(i).

137 Id., §2(a)(ii).

138 JX20 §6.15.

139 July 5 Tr. at 154:8-155:6.

140 Aug. 21 Tr. at 12:10-15 and 42:10-15.
20

Mr. Sheehan did not testify at Trial. Given this, Mr. Sheehan was not able to explain 

some of his conduct that came out in Trial testimony and through exhibits. Mr. Sheehan seems 

to have failed provided JBBR with relevant information even though he was an agent of JBBR. 

This seemed especially true following Ragnar’s October 16, 2015 request for Final Completion. 

For example, Mr. Sheehan did not respond to an email on the status of commissioning but did 

give advice to Wilson on how to respond to that same email.141 Mr. Sheehan failed, on JBBR’s 

behalf, to address information Wilson provided to Mr. Sheehan that “steam needs to be 

commissioned under load,”142 with Ragnar even though Ragnar claimed Final Completion.143 

At one point, S-Mechanical informed Mr. Sheehan about problems with the hot oil 

system auxiliary pumps.

144 However, the record does not show Mr. Sheehan sharing that 

information with JBBR.145 Moreover, Mr. Sheehan does not seem to have forwarded to JBBR 

information from Wilson that the condensate system was not fully operational.146 

Mr. Sheehan had other lapses in communication and apparent misdirected loyalties. The 

record shows that after Ragnar’s October 16, 2015 request for Final Completion, JBBR and 

Ragnar exchanged letters on a regular basis regarding that issue.

147

 For JBBR, Mr. Schnitzer 

authored each letter for Bradley Oswald to send.

148

 Mr. Sheehan communicated with Mr. 

Schnitzer about Final Completion issues.149 

141 JX302; July 6 Tr. at 24:9-25:22.

142 JX1180.

143 July 6 Tr. at 25:23-28:1.

144 JX1089.

145 July 6 Tr. at 32:18–39:3.

146 JX1185 (“condensate system not fully operational”); July 6 Tr. at 55:16–58:10.

147 See, e.g., JX4, JX12, JX13, JX109, JX1158, JX1159, JX1160a, JX1162, JX1163, JX1164, and JX1165

148 July 7 Tr. at 24:19-25:1; 32:16–33:2; 34:8-13; and 37:11-15.

149 July 7 Tr. at 16:2-19:3; 21:10–22:16; 23:2-8; and 36:8-14; see also JX9, JX10, JX1153, JX1155, JX1156, 

JX1157, and JX1166.
21

Yet it appears that Mr. Sheehan also engaged with representatives of Ragnar to help 

Ragnar respond to JBBR’s letters. For example, on October 19, 2015, Mr. Schnitzer emailed 

Mr. Sheehan suggesting specific language acceptable to JBBR for a Final Completion 

certificate.150 Mr. Sheehan, without including anyone from JBBR, emailed representatives of 

Ragnar and Wilson.151 Mr. Sheehan addressed the Ragnar/Wilson group as “Team” and said,

“here is the language I propose.”152 Thereafter, Mr. Sheehan stated: “This is all related to the 

construction contract between JBBR and Ragnar. As you know, Zenith now owns JBBR, so the 

language can say whatever you guys want it to say. I’m just the messenger.”153 The email makes 

sense only in the context of Mr. Sheehan’s having advised Ragnar and Wilson of Mr. Schnitzer’s 

language and providing appropriate responses to that language. 

On December 4, 2015, JBBR sent a letter to Ragnar.154 On December 5, 2015, Mr. 

Sheehan assisted Ragnar on its negotiating posture, suggesting arguments to make and payouts to 

request.

155

 Mr. Schnitzer testified that he did not know that Mr. Sheehan was communicating 

with Ragnar and Wilson.156 

On December 11, 2015, Mr. Hernandez, a Ragnar employee, drafted a response to a 

JBBR letter.157 Mr. Hernandez sent the draft to Tim Jagielski, an attorney for Ragnar, and Mr. 

Sheehan for comment.158 Mr. Sheehan responded with suggestions.159 Mr. Jagielski responded

with another draft.160 Mr. Sheehan then forwarded Mr. Jagielski’s email to CenterPoint’s 

150 JX1411.

151 Id.

152 Id.

153 Id.

154 JX1159.

155 JX1123; JX1128.

156 July 7 Tr. at 30:3–31:21.

157 JX1128.

158 Id.

159 Id.

160 Id.
22

outside counsel at Vinson & Elkins.

161

 Outside counsel commented and supposedly redlined the 

letter.

162

 Mr. Sheehan forwarded edits to Ragnar and requested times “later this week” for a 

conference call with Vinson & Elkins.163 The draft letter was further edited with additional input 

from Mr. Sheehan.164 Ragnar then sent a responsive letter to JBBR on December 16, 2015165

This responsive letter included some of Mr. Sheehan’s suggested changes, including proposing 

“the ‘outside date’ of 1/31/16” for testing.166

The evidentiary record at Trial does not demonstrate that Mr. Sheehan ever made JBBR 

aware of his work with Ragnar and Wilson regarding the correspondence related to Final 

Completion.

Mr. Sheehan was given information on whether the Terminal was operational. Kenneth 

Hancock, Wilson’s Senior VP, wrote on February 25, 2016, “As you know, the steam condensate 

system is not currently operational and has not yet been commissioned.”

167 In a March 2, 2016, 

email to Mr. Sheehan, among others, Mr. Hancock said “please note that with the condensate 

system not fully operational at this time...”168 Mr. Sheehan apparently never relayed that 

information on to JBBR. 

161 JX1127.

162 Id.

163 Id.

164 JX1128.

165 JX1160a.

166 Compare JX1128 with JX1160a.

167 JX1421.

168 JX1185.
23

3. Remediation by Ambitech.

JBBR retained Ambitech in early 2017 to deal with unresolved issues at the Terminal.

169

 

Ambitech inspected the Terminal and prepared a report of its findings170 In addition, Ambitech 

made recommendations to JBBR for Phase 1 and Phase 2 remediation work.171 

Ambitech performed the Phase 1 remediation work in 2017 so that JBBR could fulfill its 

obligations under the TSA for the 2017—2018 heating season.172 JBBR spent $3,091,157.64 on 

the Phase 1 remediation work.173 Mr. Haduch testified that the Phase 1 remediation work caused 

an improvement in the operability of the Terminal.174 JBBR was able to service 10-15 trains per 

month during the 2017-2018 heating season175 

JBBR made a demand for indemnification under Purchase Agreement Section 10.1.

176

CenterPoint rejected that demand.

177

F. RELATED LITIGATION 

On January 23, 2017, Ragnar filed a lawsuit against JBBR in Will County, Illinois 

seeking $992,990.40 (the “Illinois Action”).

178

 Ragnar seeks payment due upon Final 

Completion under the Construction Contract.179 JBBR filed a counterclaim against Ragnar for 

breach of the Construction Contract.180 On July 23, 2017, JBBR filed a third-party complaint 

against Wilson for breach of the MSA.181

169 July 5 Tr. at 38:3-10.

170 JX16.

171 Id.

172 Id.; July 6 Tr. at 89:6-91:3.

173 July 6 Tr. at 93:5-97:23; JX15; JX1294; JX1480.

174 July 6 Tr. at 91:4-97:23.

175 July 6 Tr. at 91:4-92:7.

176 JX1426; JX1428; and JX1481.

177 JX1427; JX1429.

178 Am. Compl. ¶ 49; Def.’s Mot. for Summ. J. at 23.

179 Def.’s Mot. for Summ. J. at 23.

180 Am. Compl. ¶ 49 (noting the filing occurred on April 26, 2017); Def.’s Mot. for Summ. J. at 23 (noting the filing 

occurred on March 23, 2017).

181 Am. Compl. ¶ 49; Def.’s Mot. for Summ. J. at 23.
24

CenterPoint is not a party to the Illinois Action.182

The Illinois Action is scheduled for trial on September 23, 2024.183

V. APPLICABLE LAW

The Court will be applying the following general legal principles:

A. GOVERNING SUBSTANTIVE LAW

Delaware law applies here. First, the Purchase Agreement is governed by Delaware law. 

Purchase Agreement Section 12.10(a) states that “[t]his Agreement shall be governed by and 

construed, interpreted and enforced in accordance with the Laws of the State of Delaware....”184 

Construction Management Agreement Section 11(h) contains identical language.185

B. BREACH OF CONTRACT

Under Delaware law, to prove a breach of contract claim, a party must show: “(1) a 

contractual obligation; (2) a breach of that obligation; and (3) resulting damages.”186 A party 

harmed by a breach of contract is entitled to compensation that will place that party in the same 

position that the party would have been in if the other party had performed under the contract.187

The standard remedy for breach of contract is based upon the reasonable expectations of 

the contracting parties.188 Expectation damages are measured by determining “the amount of 

money that would put the promisee in the same position as if the promisor had performed the 

contract.”189 “Damages for a breach of contract must be proven with reasonable certainty. 

182 JX6 § 11(h); JX20 § 12.10(a).

183 D.I. No. 205.

184 JX20 § 12.10(a).

185 JX6 § 11(h).

186 Interim Healthcare, Inc. v. Spherion Corp., 884 A.2d 513, 548 (Del. Super. 2005). 

187 See E.I. DuPont de Nemours and Co. v. Pressman, 679 A.2d 436, 445-46 (Del. 1996). 

188 See Duncan v. Theratx, Inc., 775 A.2d 1019, 1022 (Del. 2001).

189 Id.
25

Recovery is not available to the extent that the alleged damages are uncertain, contingent, 

conjectural, or speculative.”190

“Delaware adheres to the ‘objective’ theory of contracts, i.e.[,] a contract’s construction 

should be that which would be understood by an objective, reasonable third party.”191 “Contract 

terms themselves will be controlling when they establish the parties’ common meaning so that a 

reasonable person in the position of either party would have no expectations inconsistent with the 

contract language.”192 The Court has already held that the Purchase Agreement and the 

Construction Management Agreement are unambiguous.193 

C. PRINCIPAL-AGENT

Generally, agency is a fiduciary relationship that arises when a principal manifests assent 

to another that the agent will act on the principal’s behalf and subject to the principal’s control 

and the agent manifests assent or otherwise consents to act as agent.194 The existence of an 

agency relationship empowers an agent to act on behalf of the principal.195 When accompanied 

by trust that the agent will use the principal’s confidential information to pursue the principal’s 

ends, that relationship also imposes fiduciary duties on the principal.196 

Agents owe their principals a duty to disclose certain information.197 Agents also owe a 

duty to avoid gaining an interest adverse to the principal.198 Under elemental principles of 

agency law:

190 Lee-Scott v. Shute, 2017 WL 1201158, at *7 (Del. Com. Pl. Jan. 30, 2017).

191 Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153, 1159 (Del. 2010) (citing NBC Universal v. Paxson Commc’ns, 

2005 WL 1038997, at *5 (Del. Ch. Apr. 29, 2005)). 

192 Eagle Indus., Inc. v. DeVilbiss Health Care, Inc., 702 A.2d 1228, 1232 (Del. 1997).

193 Zenith Energy Terminals Joliet Holdings LLC, 2023 WL 615997, at *9-11. 

194 Estate of Eller v. Barton, 31 A.3d 895, 897 (Del. 2011).

195 Id. at 898.

196 Id. (citing to Meinhard v. Salmon, 164 N.E. 545 (N.Y. 1928).

197 Id.

198 Id.
26

[A]n agent owes his principal a duty of good faith, loyalty and fair dealing. 

Encompassed with such general duties of an agent is a duty to disclose information 

that is relevant to the affairs of the agency entrusted to him. There is also a corollary 

duty of an agent not to put himself in a position antagonistic to his principal 

concerning the subject matter of his agency.199

D. BURDEN OF PROOF BY A PREPONDERANCE OF THE EVIDENCE 

In a civil case, the burden of proof is by a preponderance of the evidence. Proof by a 

preponderance of the evidence means proof that something is more likely than not. This means 

that certain evidence, when compared to the evidence opposed to it, has the more convincing 

force and makes the Court believe that something is more likely true than not. If the evidence on 

any particular point is evenly balanced, the party having the burden of proof has not proved that 

point by a preponderance of the evidence, and the Court must find against the party on that 

point.200

In deciding whether any fact has been proved by a preponderance of the evidence, the 

Court may consider the testimony of all witnesses regardless of who called them, and all exhibits 

received into evidence regardless of who produced them.

In this particular case, Zenith carries the burden of proof by a preponderance of the 

evidence on its claims under the Purchase Agreement and the Construction Management 

Agreement.

201

E. EVIDENCE EQUALLY BALANCED

If the evidence tends equally to suggest two inconsistent views, neither has been 

established. That is, where the evidence shows that one or two things may have caused the 

breach/damages: one for which a party was responsible and one for which a party was not, the 

199 Sci. Accessories Corp. v. Summagraphics Corp., 425 A.2d 957, 962 (Del. 1980)

200 Superior Court Civil Pattern Jury Instruction 4.1.

201 See, e.g., Reynolds v. Reynolds, 237 A.2d 708, 711 (Del. 1967) (defining preponderance of the evidence); Oberly 

v. Howard Hughes Medical Inst., 472 A.2d 366, 390 (Del. Ch, 1984) (same).
27

Court cannot find for the party carrying the burden of proof if it is just as likely that the 

breach/damages was caused by one thing as by the other.202 

VI. DISCUSSION

A. THE COURT FINDS THAT ZENITH HAS SHOWN, BY A PREPONDERANCE OF THE EVIDENCE,

THAT CENTERPOINT BREACHED THE PURCHASE AGREEMENT.

In Count I, Zenith contends that CenterPoint breached the Purchase Agreement because 

CenterPoint failed use reasonable best efforts to cause Final Completion. Per the Amended 

Complaint and the theories advanced at Trial, Purchase Agreement Section 6.15(a) is especially 

relevant. Section 6.15(a) is labeled “Final Completion,” and it states:

After Closing, on and subject to the terms of the Construction Contract [with 

Ragnar] and the Construction Management Agreement, [CenterPoint] shall use its 

reasonable best efforts to achieve, and to cause the EPC Contractor [Ragnar] (and 

any other applicable third party contractors or service providers) to achieve, Final 

Completion in accordance with the Approved Cost Plan and the Project Schedule 

and otherwise in accordance with the terms and conditions of the Construction 

Contract and the Construction Management Agreement in all material respects.203

The Court previously found that Section 6.15(a) is subject to only one reasonable 

interpretation—CenterPoint was required to use its “reasonable best efforts” to achieve, and 

cause any contractor to achieve, Final Completion. 

In the Purchase Agreement, “Final Completion” is defined as “the meaning given in the 

Construction Contract.”204 The Construction Contract between JBBR and Ragnar, dated August 

26, 2014, defines “Final Completion” as:

[T]hat point in time in the progress of the Work after Mechanical Completion when 

(a) the Work has been completed and is operational; (b) all testing (including 

hydrotesting) and coating is complete; (c) all pipe, valves, and Equipment 

installation and tie-ins are complete; (d) all essential Equipment and lines have been 

hydrotested and had a geometry tool run through them; (e) the Work is capable of 

transporting refined products in a safe uninterrupted manner 24 hours per day, 

202 Superior Court Civil Pattern Jury Instruction 4.2.

203 Pls.’ Mot. for Summ. J., Ex. N (Purchase Agreement) § 6.15(a).

204 Id. at Annex I.
28

seven days per week without further anticipated shutdowns, except for preventative 

maintenance; (f) and all other requirements of this [Construction Contract] with 

respect to Final Completion ([including those set forth in Construction Contract 

Exhibit A]) have been satisfied.205

Exhibit A of the Construction Contract sets out the “Minimum Requirements for Final 

Completion” and defines them as:

(a) Final Completion includes, at a minimum, the following: (i) any liquidated 

damages payable by [Ragnar] to [JBBR] pursuant to th[is Construction Contract] 

have been paid and/or satisfied; (ii) [Ragnar] has completed all the Work required 

by this [Construction Contract]; (iii) [Ragnar] has executed and delivered to [JBBR] 

and [JBBR] has accepted the lien waiver . . .; (iv) [Ragnar] has provided the final 

close-out report to [JBBR]; (v) there are no outstanding claims or disputes as 

between [Ragnar and JBBR];....

206

Exhibit A additionally required that “any liquidated damages payable by Contractor to 

Company pursuant to the Agreement have been paid and/or satisfied” and that “there are no 

outstanding claims or disputes between the Parties.”207

Two factual issues had to be decided at Trial. First, the Court had to determine whether 

Final Completion had been achieved. Second, the Court needed to determine whether 

CenterPoint used “reasonable best efforts” to achieve, and to cause Ragnar to achieve, Final 

Completion in accordance with the Approved Cost Plan and the Project Schedule. The Court 

finds that Final Completion was not achieved during the relevant time period. The Court also 

finds that CenterPoint did not use reasonable best efforts. 

Initially, the record demonstrates that Ragnar has not paid any liquidated damages to 

JBBR or Zenith. The Court does not find that surprising as that issue is contested in the pending

205 Am. Compl., JX1 § 1.1; see also id. (“’Work’ shall mean all of [Ragnar’s] obligations, duties and responsibilities 

under this [Construction Contract], including the design, engineering, procurement, manufacturing, supply, 

installation, erection, construction, commissioning, and testing of the Facilities, all work and services described in 

Exhibit A and all Warranty Work.”) (underlining in original).

206 Id. at Ex. A.

207 Id.
29

Illinois Action. Moreover, the Illinois Action demonstrates that there are still “outstanding 

claims or disputes between” Ragnar and JBBR and Zenith.

The Court finds that the defined term “Work” is relevant to the ultimate finding that Final 

Completion did not happen. The record shows that Mechanical Completion had happened. 

However, the record also shows that Ragnar did not complete all the Work required by the 

Construction Contract. The Construction Contract defines “Work” to

[M]ean all of [Ragnar’s] obligations, duties and responsibilities under this 

[Construction Contract], including the design, engineering, procurement, 

manufacturing, supply, installation, erection, construction, commissioning, and 

testing of the Facilities, all work and services described in Exhibit A and all 

Warranty Work.”208

The evidence demonstrates that the Terminal had not been properly commissioned or 

tested.209 On October 9, 2015, Ragnar admitted this when asking for an extension of the “Date 

for Final Completion from by July 1, 2015 to October 16, 2015.210 Wilson, on October 27, 

2015, stated that “steam needs to be commissioned under load.”211 The steam condensate system 

and commissioning issues continued into 2016. On February 10, 2016, Mr. Haduch noted that 

uploading rates were poor because of difficulties getting crude oil uploaded from the railcars.212 

In addition, the factual record does not support a finding that the “Work” done by Ragnar 

was “capable of transporting refined products in a safe uninterrupted manner 24 hours per day, 

seven days per week without further anticipated shutdowns, except for preventative 

maintenance.”213 During all times relevant, the Terminal was unable to meet this standard. 

CenterPoint knew this to be true. Mr. Sheehan, in an e-mail, stated:

208 Id. § 1.1 (underlining in original) (emphasis added).

209 CenterPoint contends that Final Completion does not include commissioning. The defined term “Work” is used 

in the Construction Agreement and includes commissioning.

210 JX1408.

211 JX1180.

212 JX1421.

213 Am. Compl., JX1 § 1.1.
30

Thank you for the update on the upcoming train schedule, and thank you in advance 

for passing along any additional updates that you may receive. CenterPoint will 

continue to use reasonable best efforts to cause Ragnar Benson to achieve Final 

Completion as agreed upon by all the parties, notwithstanding the ongoing 

disagreement between [Zenith] and Ragnar with respect to the inbound pumping 

system and the occurrence of Final Completion. It is my understanding that Ragnar 

will to cause certain subcontractors and subconsultants to be present for the train 

scheduled to arrive on 2/19/16. That sounds like good news from my 

perspective.214

Wilson, Zenith and others continued to work on the steam issues and tried to arrive at 

solutions. There was a train steaming failure on March 8, 2016.215 On March 28, 2016, Mr. 

Didier identified continuing problems with steam levels while unloading railcars.216 E-mail 

correspondence among Wilson, Ragnar, CenterPoint and Zenith indicates that, as of March 30, 

2016, Wilson was addressing design issues and coming up with new recommendations.217

Under Delaware law, “reasonable best efforts” means a party is “obligat[ed] to take all 

reasonable steps to solve problems and consummate the transaction.”218 However, “it cannot 

mean everything possible under the sun.”219 In the context of merger agreements, the Court of 

Chancery has “looked to whether the party subject to the clause (i) had reasonable grounds to 

take the action it did and (ii) sought to address problems with its counterparty” in determining 

whether the “reasonable best efforts” standard was met.220 “Determining whether a party used 

reasonable best efforts is an inherently factual inquiry.”221

214 JX1417.

215 July Tr. at 69:2-4; JX1187.

216 JX1418.

217 Id.

218 Williams Cos., Inc. v. Energy Transfer Equity, L.P., 159 A.3d 264, 272 (Del. 2017) (citing Hexion Specialty 

Chems., Inc. v. Huntsman Corp, 965 A.2d 715, 755-56 (Del. Ch. 2008)).

219 AB Stable VIII LLC v. Maps Hotels & Resorts One LLC, 2020 WL 7024929, at *91 (Del. Ch. Nov. 30, 2020) 

(citing Alliance Data Sys. Corp. v. Blackstone Cap. P’rs V L.P., 963 A.2d 746, 763 n.60 (Del. Ch. 2009)).

220 Menn v. ConMed Corp., 2022 WL 2387802, at *35 (Del. Ch. June 30, 2022) (citing Akron, Inc. v. Fresenius Kabi 

AG, 2018 WL 4719347, at *91 (Del. Ch. Oct. 1, 2018)).

221 In re WeWork Litig., 2020 WL 6375438, at *9 (Del. Ch. Oct. 30, 2020). The Chancery Court stated this rule in 

the context of a motion to dismiss, noting that whether a party used reasonable best efforts is an inquiry “not readily 

amenable to resolution at the pleadings stage.” Id. Nonetheless, the inquiry is still “inherently factual.” See id.
31

As discussed in the Findings of Fact, CenterPoint did not use “reasonable best efforts” to 

cause Final Completion. CenterPoint is JBBR’s agent. As such, CenterPoint owed duties to 

JBBR. CenterPoint violated theses duties. Mr. Sheehan, who did not testify, seemed to be 

working with Ragnar and Wilson and against the interests of JBBR and Zenith. This conduct 

demonstrates a breach of an agent’s duty of loyalty. Mr. Sheehan knew of issues in 2015 and 

2016 and did not convey his knowledge to JBBR or Zenith. One of the many examples of this is 

that Wilson advised Mr. Sheehan and others that the steam condensate system was not 

operational or commissioned on February 25, 2016.222 Wilson again noted issues with the 

system on March 2, 2016.223 The record does not show that Mr. Sheehan properly informed 

JBBR of this. This conduct demonstrates a breach of an agent’s duty to disclose information that 

is relevant to the affairs of the agency entrusted to CenterPoint. 

The record is virtually devoid of actions taken by CenterPoint, on behalf of JBBR or 

Zenith, in a manner that would have caused Ragnar to achieve Final Completion. CenterPoint 

may have been able to rebut these points through Mr. Sheehan or others but failed to do so at the 

Trial. 

Eventually, Zenith went outside of CenterPoint and Ragnar and retained Ambitech to 

address issues at the terminal.224

B. THE COURT FINDS THAT ZENITH HAS SHOWN, BY A PREPONDERANCE OF THE EVIDENCE,

THAT CENTERPOINT BREACHED THE CONSTRUCTION MANAGEMENT AGREEMENT.

Construction Management Agreement Section 2(b), titled “Construction Management 

Services,” states:

[CenterPoint] shall perform the Services with substantially the same standard of 

care (including quality) as the Services were performed by or on behalf of [JBBR] 

222 JX1421.

223 JX1185.

224 July Tr. at 38:3-10.
32

prior to the Effective Date, including, without limitation, by performing the 

Services, at all times, as would a reasonably prudent construction manager in the 

construction management industry.225

Construction Management Agreement Section 2(h) limits Section 2, and it provides that 

“except as expressly set forth in Section 2, no representations, warranties or guaranties of any 

kind, express or implied . . . are made by [CenterPoint] with respect to the services provided 

under [the Construction Management Agreement],” and that all representations and warranties 

are waived and disclaimed to the fullest extent of the law.226

On Count II, the Court notes that the issue for each party is whether CenterPoint 

performed its services “as would a reasonably prudent construction manager in the construction 

management industry.”227 The issue regarding the Construction Management Agreement is the 

“reasonably prudent construction manager” language in Section 2(b). The “reasonably prudent 

person” standard “is an objective standard” and a “fact-intensive inquiry.”228

The Court’s findings regarding CenterPoint’s conduct relating to Final Completion and 

breach of its duties as agent are enough to demonstrate a breach here. In addition, the Court 

heard from Mr. Vinson229 and Mr. Hanan230 on what a reasonably prudent construction manager 

in the construction management industry must do when providing construction management 

services. The Court does find each opinion credible; however, Mr. Hanan’s opinion that 

CenterPoint did not perform its duties as a reasonable prudent construction manager is stronger 

given the actual facts of this case. Mr. Vinson testified generally on what a reasonably prudent 

225 Pls.’ Mot. for Summ. J., Ex. O § 2(b).

226 Id., Ex. O § 2(h).

227 See id., Ex. O § 2(b).

228 CMS Inv. Hldgs., LLC v. Castle, 2015 WL 3894021, at *11 (Del. Ch. June 23, 2015).

229 Aug. 21 Tr. 119:23-120:13; Aug. 21 Tr. 121:2-131:6.

230 July 5 Tr. at 162:20-163:4; July 5 Tr. at 167:1-8; July 5 Tr. at 168:21-170:12.
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construction manager would do; however, Mr. Vinson did not have an opinion as to 

CenterPoint’s role under the applicable agreements.231

C. DAMAGES

The Court finds that Zenith has demonstrated damages proximately caused by 

CenterPoint’s breach of the Purchase Agreement and the Construction Management Agreement. 

Zenith had to engage in remediation work to complete the Terminal. Zenith proved by a 

preponderance of the evidence that it suffered $3,091,157.64 in Phase I remediation work.232 In 

addition, Zenith has been engaged in the Illinois Action and has a right to be indemnified for 

losses in connection with that litigation under Construction Management Agreement Section 8(d)

and Purchase Agreement Section 10.1(b). At this point, the indemnification damages cannot be 

quantified. 

The Court does not find that Zenith is entitled to “Liquidated Damages.” Zenith 

presented this damage theory only at the end of the litigation. Zenith has not asked the Court to 

amend its Amended Complaint to add this damage claim. Instead, Zenith began raising the issue 

in its pretrial brief and in post-Trial briefing. The Court denied a motion to strike Zenith’s claim 

for Liquidated Damages but that was so the Court could review the entire record for support for 

this damage claim.

The Court will allow Zenith to offset any earn out payments due to CenterPoint under 

Purchase Agreement Section 10.8. However, the Court will not hold that such obligations are 

“terminated” due to CenterPoint’s breaches of the Purchase Agreement and the Construction 

231 Aug. 21 Tr. at 183:9-20.

232 See, e.g., JX15; JX1294; JX1480.
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Management Agreement. Zenith has not asked for such relief. In fact, the Amended Complaint 

only asks for a “setoff” of earn out payments and not a termination.233 

The Court also finds that Zenith’s requests for Liquidated Damages and termination of 

the earn out payments are over-reaching under the circumstances. As set out above, Exxon 

owned and operated an oil refinery near the Terminal.234 JBBR and Exxon entered into the 

TSA.235 The TSA was a “take or pay” contract, meaning Exxon was required to make regular 

minimum payments even if Exxon did not need a specified number of trains unloaded for the 

requisite period.236 TSA Section 7.5 provides: “[Exxon] shall be obligated to pay the Monthly

Committed Payment...regardless of whether [Exxon] in fact delivers all or any of the Committed 

Volume....”237 One of the interesting facts of this case is that Exxon performed fully under the 

TSA. As such, even with all of the problems relating to Final Completion and remediation, 

JBBR received the full benefit of the TSA. Zenith did not demonstrate that any damages were 

suffered by third parties like Exxon.

233 Am. Compl. at 21 (subsection D in prayer for relief).

234 Id.

235 JX25.

236 Id. §7 (“Volume and Fees”) and §7.5.

237 Id. § 7.5.
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VII. CONCLUSION

The Court holds that Zenith has properly proved that CenterPoint breached the Purchase 

Agreement and the Construction Management Agreement. Judgment shall be entered in favor of 

Zenith on Count I and Count II of the Amended Complaint. Damages are initially set at 

$3,091,157.64 with the right of Zenith to submit additional evidence on its indemnification 

claims.

IT IS SO ORDERED

Dated: July 29, 2024

Wilmington, Delaware

/s/ Eric M. Davis

Eric M. Davis, Judge

cc: File&ServeXpress