Opinion issued August 15, 2019

In The

Court of Appeals 

For The 

First District of Texas 

————————————

NO. 01-18-00340-CV

———————————

SUNDANCE ENERGY, INC., Appellant

V.

NRP OIL AND GAS LLP, Appellee

On Appeal from the 125th District Court

Harris County, Texas

Trial Court Case No. 2015-47595

MEMORANDUM OPINION

Appellant, Sundance Energy, Inc. (“Sundance”), challenges the trial court’s 

judgment entered, after a trial on damages and a bench trial on attorney’s fees, in 

favor of appellee, NRP Oil and Gas LLP (“NRP”). In two issues, Sundance 

contends that the evidence is legally and factually insufficient to support the trial 
2

court’s award of attorney’s fees to NRP and the evidence is legally and factually 

insufficient to support the jury’s damages award because the jury “failed to 

account for uncontroverted evidence” of an offset amount.

We affirm.

Background

In its amended petition, NRP alleged that it entered into a Purchase and Sale 

Agreement (the “PSA”) with Sundance to purchase “Sundance’s interest in certain 

oil and gas leases and wells located in three North Dakota counties.” The parties 

agreed to a purchase price of “approximately $35 million.” Sundance retained “the 

broad obligation to pay for certain pre-sale liabilities (the ‘Retained Liabilities’) 

associated with drilling, completing, and operating the wells included among the 

assets purchased.” And, “NRP agreed to be responsible for liabilities accruing 

after the sale.” 

NRP alleged that the PSA provided:

[A]ll liabilities of Seller for capital expenses, joint interest billings, 

lease operating expenses, lease rentals, shut-in payments, drilling and 

completion expenses, workover expenses, geological costs, 

geophysical costs, and other exploration or development expenditures 

and costs (collectively, “Property Expenses”) that are assessed for or 

attributable to periods of time or operations during Seller’s 

ownership of the Assets prior to the Effective Time (regardless of 

whether such operations were proposed or approved after the 

Effective Time), including all costs and expenses relating to drilling 

and completion of wells proposed to and approved by Seller prior to 

the Effective Time (regardless of whether such drilling and 

completion, or the costs incurred in connection with such activities 
3

occurred before or after the Effective Time); provided, however, that 

Property Expenses shall not include (i) costs and expenses relating to 

plugging or abandonment of the Wells, which are assumed by Buyer 

as Assumed Liabilities regardless whether such obligations arise prior 

to or after the Effective Time, or (ii) costs and expenses relating to 

environmental matters, which are addressed exclusively in Article 6 

and Article 14[.]

(alterations in original.) The “Effective Time” is defined in the PSA as “9 a.m. 

(Central Standard Time) on September 1, 2013.” 

NRP further alleged that Sundance “agreed to cover (or reimburse NRP for) 

the Retained Liabilities in the indemnification provisions set forth in ¶ 14.1 of the 

PSA,” which provided that Sundance agreed to indemnify NRP for “ALL LOSSES 

ARISING FROM OR COMPRISING THE RETAINED LIABILITIES.” And 

Sundance “further agreed that its obligation to indemnify NRP for Retained 

Liabilities would continue after the sale ‘for a period in perpetuity.’” 

Before and after the sale, NRP received a first set of joint-interest billings 

(“JIBs”) totaling $146,000 “from companies operating wells included among” the 

assets purchased in the PSA. These JIBs “requested payment for costs that 

pre-dated the Effective Time” and were subject to the indemnity provisions in the 

PSA. NRP paid these JIBs, and later forwarded them to Sundance for 

reimbursement. Sundance agreed that these JIBs were part of the Retained 

Liabilities and paid the requested amount of $146,000 in full. NRP subsequently 

“received additional JIBs totaling approximately $900,000 for liabilities that, just 
4

like the initial JIBs, were also ‘assessed for or attributable to’ Sundance’s 

ownership of the Assets before the Effective Time.” NRP paid the JIBs and again

forwarded a request to Sundance for reimbursement pursuant to the PSA. 

However, Sundance refused to reimburse NRP for the additional JIBs. 

NRP asserted causes of action against Sundance for breach of contract and 

for a declaratory judgment. It sought compensatory and actual damages, 

declarations, pre- and post-judgment interest, and reasonable and necessary 

attorney’s fees pursuant to Chapters 37 and 38 of the Texas Civil Practices and

Remedies Code. 

In its amended answer, Sundance asserted a general denial as well as the 

affirmative defenses of “SETTLEMENT/RELEASE,” “ENTITLEMENT TO 

OFFSET,” “WAIVER,” and “ESTOPPEL/QUASI-ESTOPPEL.”

At trial, David Hartz testified that he was the vice president of the oil and 

gas division of NRP at the time that the PSA was signed. And he joined NRP in 

late 2010 to build its oil and gas division. Under Hartz’s supervision, NRP became 

aware that Sundance had a “larger portfolio” of assets in the Williston Basin in 

North Dakota and Montana. 

Hartz explained that Sundance’s portfolio consisted of “non-operated”

assets, meaning the assets were drilled, completed, produced, and administered by 

another partner called the “operating” partner. “The non-operator typically [was] a 
5

leaseholder within the same unit or designated drilling spacing unit,” which had to 

“approve certain operations,” “give their consent to the operator” for certain 

operations, and then “pay their share of the invoices and then collect their share of 

the revenue.” The majority of the wells purchased by NRP were operated by EOG 

Oil and Gas (“EOG”).

Hartz further testified that before executing the PSA, NRP performed a great 

amount of due diligence to determine the value it would place upon the properties 

to be purchased. At that time, there was a group of wells that was being completed 

and NRP was “not provided information to say how much capital or how much 

they had paid for those operations to date.” In other words, NRP was aware that 

there were still outstanding bills for this group of wells that would be sent by the 

operating partner, EOG. However, Sundance could not provide information 

regarding “how much was remaining on those wells to be drilled” for NRP to 

analyze the remaining costs for purposes of valuing the assets. Hartz explained 

that this information was typically provided in an “operating” statement in oil and 

gas transactions—“which is essentially an income statement for . . . particular 

properties and capital.” Due to this missing information, NRP and Sundance 

reached a compromise where Sundance agreed to cover any remaining costs on the

assets so that NRP would not “have to come out of pocket for any of this in the 
6

future once [it] own[ed] the assets.” Accordingly, NRP made an offer to purchase 

the assets, valuing the assets based on the compromise. 

Hartz also testified that the PSA, which was entered into evidence, provided

that Sundance had certain Retained Liabilities that it would be responsible for even 

after NRP owned the assets. Specifically, Hartz testified that these Retained 

Liabilities included: (1) expenses for large capital items such as equipment—

typically related to drilling and production of a well and not ongoing maintenance; 

(2) JIBs—which were “essentially the bills or the invoices . . . receiv[ed] from the

operator”; (3) lease operating expenses—which are “essentially the normal 

operating expenses,” such as emptying the tank where oil was stored or electrical 

and water bills; (4) lease rentals if a property was leased from the government or a 

private landowner; (5) shut-in payments, if the land was leased, for shut-in or 

non-producing wells; (6) drilling completion expenses—a broad category of 

expenses shared by those in a partnership to drill, complete, and “put a well under 

production”; (7) workover expenses—which were incurred to “reestablish 

production” for a well when something had gone wrong; (8) geological costs, such 

as expenses for data “in the exploration or development of prospects”; 

(9) geophysical costs, such as seismic or other data collected relating to the “field 

of geophysics”; (10) and “other exploration or development expenditures and 

costs” which was a “catchall for remaining expenses.” However, Sundance’s 
7

liability for these costs was limited to “costs that [were] assessed for or attributable 

to periods of time or operation during” Sundance’s “ownership of the assets prior 

to the effective time.” Hartz testified that, per the PSA, this indemnification was to 

continue in perpetuity. He further explained that NRP would pay for any “normal 

operating expenses associated with owning the assets or anything that [NRP] 

would approve during [its] ownership of the assets, drilling of a new well, et 

cetera” incurred after the effective date of the PSA, which was September 1, 2013. 

Hartz explained that following execution of the PSA, NRP made several 

requests for “indemnification” pursuant to the PSA based on JIBs it received from 

EOG. The first was for $146,304.85. Sundance quickly responded to NRP’s

request by admitting its responsibility to cover the expenses and paid NRP the 

requested amount. After receiving additional JIBs from EOG, NRP again 

requested indemnification from Sundance. NRP made subsequent requests for 

reimbursement, which remained unpaid at the time of trial. In total, Hartz testified 

that NRP was seeking damages based on its requests for indemnification to 

Sundance in the amount of $988,254.

At trial, a copy of the PSA was admitted into evidence. It provides, in 

relevant parts, as follows:

4.1 Closing Adjustments. With respect to matters that can

be determined as of the Closing, Seller shall prepare, in accordance 

with the provisions of this Article 4, a statement (the “Closing 

Adjustment Statement”) with relevant supporting information 
8

setting forth each adjustment to the Base Purchase Price submitted by 

Seller in accordance with this Agreement. Seller shall submit the 

Closing Adjustment Statement to Buyer, together with all records or 

data supporting the calculation of amounts presented on the Closing 

Adjustment Statement, no later than five (5) business days prior to the 

scheduled Closing Date. Prior to the Closing, Buyer and Seller shall 

review the adjustments proposed by Seller in the Closing Adjustment 

Statement and shall work in good faith to arrive at agreed adjustments. 

Agreed adjustments shall be taken into account in computing any 

adjustments to be made to the Base Purchase Price at the Closing. To 

the extent actual figures are not available, estimates shall be used 

subject to final adjustments as described in Section 4.4 below. 

. . . .

4.4 Post-Closing Adjustments. A post-closing adjustment 

statement (the “Post-Closing Adjustment Statement”) shall be 

prepared and delivered by Seller to Buyer within ninety (90) days 

after the Closing, proposing further adjustments to the calculation of 

the Purchase Price based on the information then available. Seller or 

Buyer, as the case may be, shall be given access to and shall be 

entitled to review and audit the other Party’s records pertaining to the 

computation of amounts claimed in such Post-Closing Adjustment 

Statement. Within fifteen (15) days after receipt of the Post-Closing 

Adjustment Statement, Buyer shall deliver to Seller a written 

statement describing in reasonable detail its objections (if any) to any 

amounts or items set forth on the Post-Closing Adjustment Statement. 

If Buyer does not raise objections within such period, then the 

Post-Closing Adjustment Statement shall become final and binding 

upon the Parties at the end of such period. If Buyer raises objections, 

the Parties shall negotiate in good faith to resolve any such objections. 

If the Parties are unable to resolve any disputed item within (15) days 

after Buyer’s receipt of the Post-Closing Adjustment Statement, any 

such disputed item shall be submitted to a nationally recognized 

independent accounting firm mutually agreeable to the Parties who 

shall be instructed to resolve such disputed item within thirty (30) 

days. The resolution of disputes by the accounting firm so selected 

shall be set forth in writing and shall be conclusive, binding upon the 

Parties and non-appealable, and the Post-Closing Adjustment 

Statement shall become final and binding upon the Parties on the date 
9

of such resolution. The fees and expenses of such accounting firm 

shall be paid one-half by Buyer and one-half by Seller. After the 

Post-Closing Adjustment Statement has become final and binding on 

the Parties, Seller or Buyer, as the case may be, shall pay to the other 

such sums are due to settle accounts between the Parties due to 

difference between the estimated Purchase Price paid pursuant to the 

Closing Adjustment Statement and the actual Purchase Price set forth 

on the Post-Closing Adjustment Statement. 

Article 14 provides that Sundance as the Seller “SHALL TO THE 

FULLEST EXTENT PERMITTED BY LAW, RELEASE, DEFEND, 

INDEMNIFY, AND HOLD HARMLESS BUYER . . . FROM AND 

AGAINST . . . . ALL LOSSES ARISING FROM OR COMPRISING THE 

RETAINED LIABILITIES.” Further, “Seller shall be obligated to indemnify 

Buyer under Section 14.1(c) for any Loss arising from the Retained Liabilities for 

a period in perpetuity.” 

Cathy Anderson testified that she was the Chief Financial Officer of 

Sundance at the time NRP made its requests for indemnification, however she was 

not involved in negotiating or drafting the PSA. Anderson testified that Sundance 

paid NRP’s initial request for indemnification because it was very close to the 

deadline allowed in the PSA for post-closing adjustments and they “were trying to 

not cause an issue,” although they believed that the charges “should have [been] 

included” in any post-closing adjustments. After receiving NRP’s second request 

for indemnification, Sundance began to “really dig[] into the details and look[] at 

what was coming through.” Anderson explained that the PSA provided that 
10

Sundance would continue to cover “drilling and completion costs” for the wells 

that had been drilled close to the effective date of the PSA. And after “digging 

in[]”, Sundance realized “other” charges that did not concern drilling and 

completion were “coming through.” Sundance then hired a “joint interest auditor”

to research the charges in the additional JIBs for which NRP sought 

reimbursement. 

According to Anderson, Sundance ultimately rejected NRP’s request for 

reimbursement for the remaining amounts. And Anderson sent Hartz a letter, a 

copy of which was admitted into evidence at trial, explaining Sundance’s 

reasoning behind refusing to reimburse NRP. That letter, in part, reads as follows:

We have completed our review of the supplemental billings from 

EOG you sent us beginning last July. After analyzing the specific 

items and reviewing the PSA, we have concluded that Sundance does 

not have responsibility for these billings, and so we respectfully 

decline your request to reimburse NRP for them. I will explain our 

thinking.

First, $301,503 of the charges related to the installation of facilities,

such as tanks, gathering lines, etc. Facilities costs are not “drilling 

and completion costs” and Sundance never agreed to retain liability 

for facilities costs . . . .

Second, the remaining $606,063 of the JIBs do cover costs that would 

be classified as drilling and completion costs, but we think that 

responsibility for those costs was finally settled between the parties at 

final settlement. We base this conclusion on the language in Section 

4.4 of the PSA, which states that the Post-Closing Adjustment

Statement shall be “final and binding” on the parties either if not 

challenged or following resolution of any challenge by the accounting 

firm. Section 4.1 of the PSA provides for settling allocations of costs 
11

between the parties on a preliminary basis at closing based on 

estimates, “subject to final adjustments as provided in Section 4.4 

below.” We think the PSA is clear that the settlement of Property 

Expenses in the Post-Closing Adjustment Statement was final and 

binding on the parties.

With respect to the letter, Anderson testified that everyone agreed that final 

was final.” She testified that they “all signed the final post-closing settlement

statement,” which “ended it and that was what was the agreement of the parties.” 

She further explained that Sundance could have, and should have, sought an 

adjustment for the amount it seeks in an offset, but that it did not realize its 

oversight until after the time for adjustment under the PSA had passed. Anderson 

admitted that there was no language in the PSA’s Article 14 indemnification that 

appeared to limit NRP’s right to indemnification based on the post-closing 

adjustment period. 

After deliberating, the jury returned a verdict on liability in favor of NRP as 

follows:

Question No. 1: 

Did Sundance fail to comply with the PSA?

Answer “Yes” or “No.”

Answer: YES

. . . .
12

Question No. 2: 

Was Sundance’s failure to comply excused?

Answer “Yes” or “No.”

Answer: NO

. . . . 

Question No. 3: 

What sum of money, if any, if paid now in cash, would fairly 

and reasonably compensate NRP for its economic damages, if any, 

that resulted from Sundance’s failure to comply with the PSA?

. . . . 

Answer: $988,254

Question No. 4: 

Do you find Sundance is entitled to any offset of any 

amounts found by you in response to Question No. 3?

Answer “Yes” or “No.”

Answer: NO

The parties agreed to try the attorney’s fee portion of the case to the bench. 

After the jury returned its verdict, the trial court adjourned the trial on attorney’s

fees until a time when the parties were able to reconvene. Originally, NRP set the 

hearing for a determination of attorney’s fees for October 20, 2017. On October

16, 2017, Sundance filed objections to NRP’s failure to properly disclose its 

attorney’s fees witnesses and evidence. NRP reset the hearing twice, and the 
13

attorney’s fees issue was tried to the bench on January 12, 2017—nearly six 

months after the initial trial had begun. 

At the hearing, the trial court decided to admit NRP’s attorney’s fees 

testimony and other evidence, despite its untimely disclosure. Pursuant to Texas 

Rule of Civil Procedure 193, the trial court determined that there was no unfair 

surprise or prejudice to Sundance in admitting NRP’s evidence and testimony on 

the issue of attorney’s fees, considering, among other things, that Sundance had the 

invoices for one hundred days before the hearing and the disclosures were made 

seventy-four days before the hearing. The trial court also offered Sundance a 

continuance of the hearing to allow it to “conduct any additional discovery into the 

subject matter of the attorney[’s] fees” that was to be addressed at the hearing. 

Sundance did not seek a continuance.

Matthew Henneman, an attorney for NRP, testified that he has been licensed 

in the State of Texas for approximately 23 years, he has tried multiple jury trials 

and arbitrations in Harris County and consistently handles “large complex 

commercial litigation and contract disputes.” He further testified that he is familiar 

with the “reasonable, customary, and necessary attorney[’s] fees charged in cases 

of this type by attorneys practicing in Harris County[,] Texas and the surrounding 

area.” Henneman testified that he was with the firm that represented NRP in this 

case and is familiar with the case. The standard hourly rate for a partner, such as 
14

Henneman, at his firm is between $525 and $575 per hour and the hourly rate for 

an associate is between $235 and $400 per hour, “depending on experience and 

other factors.” 

Henneman reviewed the entire file for the case, including all “timekeepers”

who worked on the case. The largest amount of time billed in this case by NRP’s 

attorneys was attributed to “review of [and] examination of the agreements 

between NRP and Sundance, which was the core element and core dispute in th[e]

case.” NRP’s attorneys also reviewed the pleadings, drafted discovery requests 

and discovery responses, and participated in multiple depositions and conferences. 

Further, attorneys spent time preparing “dispositive motions,” “various pleadings,”

and other motions, preparing for trial, and trying the case. Henneman explained 

that he considered the time involved, the skill needed to prosecute the case, other 

work that the attorneys could not have taken on because they were fully engaged

on this case, the fee regularly charged by the firms and in Harris County, Texas for 

cases of this nature, as well as the amount involved in the verdict—which was over 

$900,000. He further considered the nature of the attorney’s relationships with the 

clients. And based “on those factors,” it was his “opinion that the fees charged in 

this matter [by NRP’s attorneys were] reasonable, customary, and necessary for 

this type of matter.” And, although a lot of the discovery that was conducted was 

not ultimately used at trial, Henneman testified that the amount of discovery 
15

conducted was necessary to do a thorough and complete job litigating the case for 

NRP. 

Further, Henneman discounted the fees by twenty-five percent to account for

the work performed on the declaratory-judgment claim, for which fees were not 

recoverable and which was dropped by NRP before trial. He also explained that 

the median rate charged for commercial litigation in the State of Texas in 2015 was 

$295 per hour. Because this was “not a median rate case,” he recommended that 

the rate applied “be increased to $350 per hour in this matter.” 

Overall, Henneman concluded that NRP’s recoverable attorney’s fees were 

$396,007.75. He explained that he reached this conclusion by multiplying the 

number of hours worked on the case—1,137.15—by the rate of $350 per hour. He 

then subtracted amounts attributed to the declaratory-judgment claim. Henneman 

further testified that “an intermediate appellate court appeal would cost 

approximately $50,000” and an appeal to the Texas Supreme Court would “also 

cost a similar amount.”

Phillip Sharp testified as Sundance’s rebuttal witness on the issue of 

attorney’s fees. He testified that he has tried more than thirty jury trials and at least 

ten bench trials and is familiar with the fees charged by lawyers in the Houston 

legal community. Sharp testified that he did not disagree with the hourly rates 

charged by NRP’s attorneys, but that “a good deal of the work was not necessary”
16

and, thus, the charges overall were unreasonable. More specifically, he testified 

that, in his opinion, “this case sets the record for the most documents produced in 

discovery that didn’t have anything in the world to do with the trial.” He explained 

that the amount of discovery conducted was extremely excessive given it only took 

NRP one day to put on its entire case-in-chief. He also testified that the time of the 

attorney who was involved in drafting and negotiating the PSA on behalf of NRP, 

and who stayed involved and talked to people during trial, should not be 

recoverable by NRP because “the deal lawyer’s fees” should not be recoverable for 

a subsequent trial on the subject-matter. Instead, Sharp opined that he would 

expect reasonable attorney’s fees in this case to be closer to one-half of those 

requested by NRP or around $200,000. Sharp also admitted that he had reviewed a 

great number of documents produced in the case and that Sundance did not file a 

motion for protection related to the discovery requests served by NRP.

Following the bench trial on attorney’s fees, the trial court entered judgment

in favor of NRP, awarding NRP damages against Sundance in the amount of 

$988,254, without allowing for any offset. It further awarded NRP attorney’s fees 

in the following amounts:

(1) $396,007.75 for representation through trial;

(2) $50,000.00 for representation through appeal to the court of appeals; 

and
17

(3) $50,00.00 for representation through an appeal to the Supreme Court 

of Texas.

Sundance filed a motion for judgment notwithstanding the verdict, arguing, 

among other things, that the “attorney[’s] fees evidence was improper and should 

have been stricken by the trial court” for failure to timely disclose the evidence, 

that the evidence of attorney’s fees was legally and factually insufficient to support 

the attorney’s fees award, and that the evidence was legally and factually 

insufficient to support the jury’s damages award because the jury failed to award 

an offset, of which the evidence was uncontroverted. The trial court denied 

Sundance’s motion for judgment notwithstanding the verdict.

Standard of Review

When, as here, an appellant attacks the legal sufficiency of an adverse 

finding on an issue on which it did not have the burden of proof, it must 

demonstrate that no evidence supports the finding. Examination Mgmt. Servs., Inc. 

v. Kersh Risk Mgmt., Inc., 367 S.W.3d 835, 839 (Tex. App.—Dallas 2012, no pet.).

Under such circumstances, we will sustain a legal sufficiency or “no-evidence”

challenge if the record shows any one of the following: (1) a complete absence 

of evidence of a vital fact, (2) rules of law or evidence bar the court from giving 

weight to the only evidence offered to prove a vital fact, (3) the evidence offered to 

prove a vital fact is no more than a scintilla, or (4) the evidence establishes 

conclusively the opposite of the vital fact. City of Keller v. Wilson, 168 S.W.3d
18

802, 810 (Tex. 2005). In contrast, when an appellant attacks the legal sufficiency 

of a finding on which it bore the burden of proof, it must show not only that no 

evidence supports finding, but also that the evidence conclusively proves the 

contrary. Dow Chem. Co. v. Francis, 46 S.W.3d 237, 241 (Tex. 2001). Under this 

standard, we reject the challenge unless the evidence proves all vital facts in 

support of the challenger’s position as a matter of law. Id. at 624. Regardless of 

who bears the burden of proof, in conducting a legal-sufficiency review, we 

consider the evidence in the light most favorable to the verdict and indulge every 

reasonable inference that supports it. City of Keller, 168 S.W.3d at 822. 

If there is more than a scintilla of evidence to support the challenged finding, 

we must uphold it. Formosa Plastics Corp. USA v. Presidio Eng’rs & 

Contractors, Inc., 960 S.W.2d 41, 48 (Tex. 1998). “[W]hen the evidence offered 

to prove a vital fact is so weak as to do no more than create a mere surmise or 

suspicion of its existence, the evidence is no more than a scintilla and, in legal 

effect, is no evidence.” Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 601 (Tex. 

2004) (internal quotations omitted). However, if the evidence at trial would enable 

reasonable and fair-minded people to differ in their conclusions, then jurors must 

be allowed to do so. City of Keller, 168 S.W.3d at 822. “A reviewing court cannot 

substitute its judgment for that of the trier-of-fact, so long as the evidence falls 

within th[e] zone of reasonable disagreement.” Id.
19

When an appellant attacks the factual sufficiency of an adverse finding on an 

issue on which it did not have the burden of proof, it must demonstrate that the 

adverse finding is so contrary to the overwhelming weight of the evidence as to be 

clearly wrong and manifestly unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 

1986). In conducting a factual-sufficiency review, we examine, consider, and 

weigh all evidence that supports or contradicts the fact finder’s determination.

See Dow Chem. Co., 46 S.W.3d at 242; Plas-Tex, Inc. v. U.S. Steel Corp., 772 

S.W.2d 442, 445 (Tex. 1989). We note that the fact finder is the sole judge of the 

witnesses’ credibility, and it may choose to believe one witness over another; a 

reviewing court may not impose its own opinion to the contrary. See Golden Eagle 

Archery, Inc. v. Jackson, 116 S.W.3d 757, 761 (Tex. 2003). The fact finder may 

also resolve inconsistencies in the testimony of any witness. McGalliard v. 

Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986). We set aside the verdict only if the

evidence is so weak or the finding is so against the great weight and preponderance 

of the evidence that it is clearly wrong or manifestly unjust. See Dow Chem. Co., 

46 S.W.3d at 242; Pool v. Ford Motor Co., 715 S.W.2d 629, 635 (Tex. 1986).
20

Sufficiency of the Evidence

A. Attorney’s fees

In its first issue, Sundance argues that the evidence is legally and factually 

insufficient to support the trial court’s award of attorney’s fees to NRP.

1. Untimely disclosures

In a portion of its first issue, Sundance asserts that the trial court “failed to 

exclude documents supporting NRP’s attorney[’s] fees evidence because NRP 

failed to timely produce them.” It further asserts that because NRP’s evidence 

regarding its attorney’s fees should have been excluded, it constitutes no evidence 

to support the trial court’s award of attorney’s fees to NRP.

We review whether a trial court erred in making an evidentiary ruling for an 

abuse of discretion. Bay Area Healthcare Grp., Ltd. v. McShane, 239 S.W.3d 231, 

234 (Tex. 2007). A trial court abuses its discretion if it acts in an arbitrary or 

unreasonable manner or without reference to guiding rules or principles. Bowie 

Mem’l Hosp. v. Wright, 79 S.W.3d 48, 52 (Tex. 2002). We will uphold a trial 

court’s evidentiary ruling if any legitimate ground supports the ruling, even if the 

ground was not raised in the trial court. Hooper v. Chittaluru, 222 S.W.3d 103, 

107 (Tex. App.—Houston [14th Dist.] 2006, pet. denied). And we will not reverse 

an erroneous evidentiary ruling unless the error probably caused the rendition of an 

improper judgment or prevented a proper presentation of the appeal. See TEX. R.
21

APP. P. 44.1(a); Sw. Elec. Power Co. v. Burlington N. R.R. Co., 966 S.W.2d 467, 

474 (Tex. 1998). In determining whether the erroneous admission or exclusion of 

evidence probably resulted in the rendition of an improper judgment, we review 

the entire record, and “[t]ypically, a successful challenge to a trial 

court’s evidentiary ruling[] requires the complaining party to demonstrate that the 

judgment turns on the particular evidence excluded or admitted.” Interstate 

Northborough P’ship v. State, 66 S.W.3d 213, 220 (Tex. 2001).

Texas Rule of Civil Procedure 193.6(a) provides that “[a] party who fails to 

make, amend, or supplement a discovery response in a timely manner may not 

introduce in evidence the material or information that was not timely 

disclosed . . . .” TEX. R. CIV. P. 193.6(a). However, a trial court may admit 

untimely disclosed evidence upon a showing of “good cause” or that use of the 

evidence would not “unfairly surprise or unfairly prejudice” the other party. Id.

193.6(a)(1), (2). The burden of “establishing good cause or the lack of unfair 

surprise or unfair prejudice is on the party seeking to introduce the evidence or call 

the witness.” Id. 193.6(b). And “[a] finding of good cause or the lack of unfair 

surprise or unfair prejudice must be supported by the record.” Id. However, even 

if the party seeking to introduce the evidence at issue does not carry its burden of 

establishing the grounds for the exception, the trial court “may grant a continuance 

or temporarily postpone the trial to allow a response to be made, amended, or 
22

supplemented, and to allow [the] opposing part[y] to conduct discovery regarding 

any new information presented by that response.” Id. 193.6(c).

In this case, the trial court specifically made a finding of no unfair surprise 

or unfair prejudice. Additionally, the trial court offered a continuance to Sundance 

in order to allow it “to conduct any additional discovery into the subject matter of 

the attorney[’s] fees” that was raised by the untimely disclosure. Sundance 

declined a continuance, and the trial court overruled Sundance’s objection and 

request to exclude NRP’s evidence of attorney’s fees based on its untimely 

disclosure. 

On appeal, Sundance asserts that a continuance in this case would not have 

remedied the unfair surprise or prejudice. However, its assertion is based solely on 

the bifurcation of the liability and attorney’s fees portions of the trial and the trial 

court’s alleged failure to timely reconvene the trial to address the outstanding issue 

of attorney’s fees. But the record indicates that Sundance agreed to the bifurcation 

of the case and to try the issue of attorney’s fees to the trial court. And Sundance 

does not assert that it opposed the allegedly unreasonable delay in commencing the 

trial in the trial court, nor does it present any error of that nature to this Court. 

Based on the record below and the arguments presented on appeal, we 

cannot conclude that the trial court’s offer of a continuance was insufficient to 

remedy any unfair prejudice to Sundance. Accordingly, having refused the trial 
23

court’s offer a continuance pursuant to Texas Rule of Civil Procedure 193.6(c), 

Sundance cannot now argue that it suffered unfair prejudice by the admission of 

NRP’s attorney’s fees evidence. Santos v. Comm’n for Lawyer Discipline, 140 

S.W.3d 397, 404 (Tex. App.—Houston [14th Dist.] 2004, no pet.) (party “can 

hardly be heard to argue that he was unfairly prejudiced” after declining trial 

court’s offer of continuance to conduct discovery on new information); see also, 

e.g., Hilburn v. Providian Holdings, Inc., No. 01-06-00961-CV, 2008 WL 

4836840, at *11 (Tex. App.—Houston [1st Dist.] Nov. 6, 2008, no pet.) (mem. op.)

(holding admission of expert testimony on attorney’s fees not abuse of discretion, 

despite untimely disclosure, where opponent of evidence refused offer of further 

discovery and did not demonstrate offer insufficient).

Accordingly, we hold that the trial court did not err in admitting NRP’s

attorney’s fees evidence. 

We overrule this portion of Sundance’s first issue. 

2. Reasonable and necessary

In the remaining portion of its first issue, Sundance asserts that even if we do 

not determine that the trial court erred in admitting NRP’s attorney’s fees evidence, 

the evidence is legally and factually insufficient to support the trial court’s 

attorney’s fees award “pursuant to what is allowable under Texas law.”
24

The reasonableness of an attorney’s fee award is evaluated by considering 

the following factors: (1) the time and labor required, novelty, and difficulty of the 

question presented and the skill required to properly perform the legal service; 

(2) the likelihood that the acceptance of employment precluded other employment 

by the attorney; (3) the fee customarily charged in the locality for similar services; 

(4) the amount involved and the results obtained; (5) the time limitations imposed 

by the client or by the circumstances; (6) the nature and length of the professional 

relationship with the client; (7) the experience, reputation, and ability of the 

attorney performing the services; and (8) whether the fee is fixed or contingent.

Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 818 (Tex. 1997); 

McMahon v. Zimmerman, 433 S.W.3d 680, 693 (Tex. App.—Houston [1st Dist.] 

2014, no pet.). Further, “[t]rial judges can draw on their common knowledge and 

experience as lawyers and as judges in considering the testimony, the record, and 

the amount in controversy in determining attorney’s fees.” Zimmerman, 433 

S.W.3d at 693 (internal quotations omitted); see also In re Guardianship of 

Hanker, No. 01-12-00507-CV, 2013 WL 3233251, at *5 (Tex. App.—Houston [1st 

Dist.] June 25, 2013, no pet.) (holding trial judge may “draw[] on her knowledge 

of the case, review of the court file, and her experience in other . . . proceedings in 

determining whether a requested fee is reasonable”).
25

Detailed invoices of the work performed by NRP’s attorneys were admitted 

into evidence at trial along with the expert testimony of Henneman, an attorney for 

NRP. 

Henneman testified that he has been licensed in the State of Texas for 

approximately 23 years, he has tried multiple jury trials and arbitrations in Harris 

County and consistently handles “large complex commercial litigation and contract 

disputes.” He further testified that he is familiar with the “reasonable, customary, 

and necessary attorney’s fees charged in cases of this type by attorneys practicing 

in Harris County[,] Texas and the surrounding area.” Henneman testified that he 

was with the firm that represented NRP in this case and is familiar with the case, 

attorneys who worked on the case, and the hourly rates charged for the work 

performed by those attorneys. 

Henneman reviewed the entire file for the case and explained that the largest 

amount of time billed in this case by NRP’s attorneys was for “review of [and] 

examination of the agreements between NRP and Sundance, which was the core 

element and core dispute in this case.” NRP’s attorneys also reviewed the 

pleadings, drafted discovery requests and discovery responses, and participated in 

multiple depositions and conferences. Further, attorneys spent time preparing

“dispositive motions,” “various pleadings,” other motions, as well as preparing for 

trial and trying the case. Although a lot of discovery that was conducted was not 
26

used at trial, Henneman testified that the nature of discovery was necessary to do a 

thorough and complete job working up the case for NRP. Henneman also 

considered the time involved, the skill needed to prosecute the case, other work 

that the attorneys could not have taken on because they were fully engaged on this 

case, the fee regularly charged by the firms and in Harris County, Texas for cases 

of this nature, as well as the amount involved in the verdict—which was over 

$900,000. He testified that in his opinion the fees charged by NRP’s attorneys 

were reasonable, customary, and necessary. 

Henneman concluded that the total reasonable number of hours worked on 

the case was 1,137.15. He multiplied the number of hours by an adjusted-median 

billable rate of $350 per hour and discounted the fees by twenty-five percent for 

work performed on the declaratory-judgment claim, for which fees were not 

recoverable and which was dropped by NRP before trial. Based on this analysis, 

Henneman determined that NRP’s reasonable recoverable attorney’s fees were 

$396,007.75. He additionally opined that “an intermediate appellate court appeal 

would cost approximately $50,000” and an appeal to the Texas Supreme Court 

would “also cost a similar amount.”

Sharp testified as Sundance’s rebuttal witness on the issue of NRP’s 

attorney’s fees. He opined that the hourly rates charged by NRP’s attorneys were 

reasonable, but that the overall charges were unreasonable because, with regard to 
27

discovery, “a good deal of the work was not necessary.” He explained that he 

believed the amount of discovery conducted was excessive given the few 

documents actually used as exhibits at trial and that it only took NRP one day to 

put on its case-in-chief at trial. Sharp opined that he would expect reasonable 

attorney’s fees for NRP in this case to be closer to $200,000.

Based on our review of the record, we conclude that there was legally and 

factually sufficient evidence to support the trial court’s award of attorney’s fees to

NRP. The detailed invoices and Henneman’s testimony concerning the fees 

charged and work performed in this case were some evidence in support of the 

award, satisfying the legal sufficiency requirement. Zimmerman, 433 S.W.3d at 

694; see also City of Keller, 168 S.W.3d at 827. Further, given the record, the trial 

court’s award of attorney’s fees in this case is not so clearly wrong or manifestly 

unjust to require reversal for factual insufficiency. This is a complex-commercial 

litigation case involving a fully-litigated breach of contract claim related to a PSA 

to purchase $35 million of oil and gas assets. There are detailed billing records as 

well as Henneman’s testimony regarding the total hours billed, how he reduced 

those hours to account for the inability to recover for work performed on the 

declaratory-judgment claim, his and the other attorney’s billable rates, the standard 

billable rate in the community and what billable rate should be applied in this case, 

and the trial court could take judicial notice of the standard and customary fees as 
28

well as the content of the case file. Zimmerman, 433 S.W.3d at 694 (citing Cain, 

709 S.W.2d at 176). 

Accordingly, we hold that the evidence is legally and factually sufficient to 

support the trial court’s award of attorney’s fees in this case.

We overrule the remaining portion of Sundance’s first issue. 

B. Offset

In its second issue, Sundance argues that the evidence is legally and 

factually insufficient to support the jury’s damages ward because “the jury failed to 

account for uncontroverted evidence of Sundance’s right to an offset.” 

The alleged “uncontroverted” evidence relied upon by Sundance is 

testimony from Anderson that NRP’s damages included amounts for items that 

were not part of Sundance’s Retained Liabilities in the amount of $382,000. At

trial and on appeal, Sundance’s argument that it is entitled to an offset of damages 

is premised upon Section 4.4 of the PSA.1 Section 4.4 required Sundance to 

prepare—which it did—a post-closing adjustment statement within ninety days of 

closing “proposing further adjustments to the calculation of the Purchase Price 

based on information then available.” And Anderson testified that the $382,000 

 

1 To the extent that Sundance would argue it was entitled to an offset based on 

Article 14 of the PSA, that argument is not properly briefed or raised and, thus,

waived. See TEX. R. APP. P. 38.1.
29

offset was not included on the post-closing adjustment statement because it was 

just missed, but she wished it had been included. 

Accordingly, there is nothing in Anderson’s testimony that would establish 

Sundance’s right to an offset pursuant to Section 4.4. It is undisputed that 

Sundance did not request an adjustment to the purchase price in its post-closing 

statement for the amount it now requests to be offset because it did not catch the 

alleged error in time. And it is indisputable that more than ninety days have passed 

since the closing on the PSA.

We are additionally unpersuaded by Sundance’s argument that NRP’s 

damages were only recoverable pursuant to Section 4.4 and not the indemnity 

provision in Article 14, and, thus, it should be allowed an offset pursuant to 

Section 4.4. The record demonstrates that NRP brought a breach of contract claim

against Sundance based on Sundance’s failure to indemnify it for assumed 

liabilities pursuant to Article 14 of the PSA, as it was required to do in perpetuity. 

This was the same theory pursued by NRP at trial. The jury found that Sundance 

breached the PSA and Sundance does not challenge this finding. The jury further 

found that Sundance was not entitled to an offset of damages. To the extent that 

Anderson testified that any of the damages sought by NRP were not recoverable 

under the Article 14 indemnification provision, this evidence was controverted by 

the testimony of Hart which supported NRP’s theory that those damages do fall 
30

under the indemnification provision. As such, Anderson’s testimony in that regard 

is not uncontroverted. And, in a jury trial, “[j]urors are the sole judges of the 

credibility of the witnesses and the weight to give their testimony. They may 

choose to believe one witness and disbelieve another. Reviewing courts cannot 

impose their own opinions to the contrary.” City of Keller, 168 S.W.3d at 819. 

Thus, we conclude that the record lacks any evidence that Sundance is 

entitled to an offset as requested. Accordingly, we hold that the evidence is 

factually and legally sufficient to support the jury’s damages award. 

We overrule Sundance’s second issue. 

Conclusion

We affirm the judgment of the trial court.

Julie Countiss

Justice

Panel consists of Justices Lloyd, Landau, and Countiss.