* This order and judgment is not binding precedent, e xcept under the

doctrines of law of the case, res judicata, and col lateral estoppel. The court generally disfavors the citation of orders and judg ments; nevertheless, an order and judgment may be cited under the terms and condi tions of 10th Cir. R. 36.3.

** Honorable John W. Lungstrum, District Judge, UnitedStates District Court for the District of Kansas, sitting by designation.

UNITED STATES COURT OF APPEALS Filed 12/9/96 FOR THE TENTH CIRCUIT

WILLIAM H. DAVIS, Trustee of the Joe D. Davis Revocable Trust,

Plaintiff-Appellant,

v. SONAT EXPLORATION COMPANY,

Defendant-Appellee. No. 95-5248 (D.C. No. 94-C-828-H) (N.D. Okla.)

ORDER AND JUDGMENT *

Before BALDOCK and BRISCOE, Circuit Judges, and LUN GSTRUM, ** District Judge.

After examining the briefs and appellate record, th is panel has determined unanimously to grant the parties’ request for a dec ision on the briefs without oral-2-

argument. See Fed. R. App. P. 34(f) and 10th Cir. R. 34.1.9. Th e case is therefore ordered submitted without oral argument. Plaintiff William H. Davis, as Trustee of the Joe D . Davis Revocable Trust (Davis Trust), appeals from the entry of summary ju dgment in favor of defendant Sonat Exploration Co. (Sonat) in this diversity act ion for breach of contract and related tortious conduct. As explained below, we a ffirm for substantially the reasons stated in the district court’s thorough andwell-reasoned order granting Sonat’s motion for summary judgment. Plaintiff brought suit to recover damages incurred when Sonat, invoking a buyer’s satisfaction clause included in the parties ’ preliminary agreement, withdrew its offer to purchase certain oil and gas properties from the Davis Trust. Acknowledging application of the clause, plaintiff claimed Sonat breached its attendant duty of good faith and fair dealing by re lying on environmental problems which, being insufficient to warrant a rea sonable invocation of the clause in themselves, merely served as a pretext co ncealing Sonat’s ulterior motivation to terminate the agreement on impermissi ble economic grounds. The district court held plaintiff’s evidence legally in sufficient to support such allegations and, accordingly, granted Sonat’s motio n for summary judgment.

We review the grant or denial of summary judgment d e novo, applying the same legal standard used by the distri ct court pursuant to Fed. R. Civ. P. 56(c). Summary judgment is appr opriate if the pleadings, depositions, answers to interrogatories, and admissions on-3-

file, together with the affidavits, if any, show th at there is no genuine issue as to any material fact and that the moving p arty is entitled to judgment as a matter of law. When applying this st andard, we examine the factual record and reasonable inference s therefrom in the light most favorable to the party opposing summ ary judgment. . . . While the movant bears the burden of showing the ab sence of a genuine issue of material fact, the movant need notnegate the non-movant’s claim. . . . If the movant carries th is initial burden, the non-movant may not rest upon its pleadings, but mus t set forth specific facts showing a genuine issue for trial as to those dispositive matters for which it carries the burden of proof. An issue of material fact is genuine if a reasonable jury could return averdict for the non-movant. Wolf v. Prudential Ins. Co. , 50 F.3d 793, 796 (10th Cir. 1995)(citations and quotations omitted). We note that plaintiff bore t he burden of establishing the conditions precedent to Sonat’s obligations under the parties’ agreement. See Smith v. Government Employees Ins. Co. , 558 P.2d 1160, 1162 (Okla. 1976). On appeal, the parties dispute the proper legal sta ndard for assessing Sonat’s invocation of the satisfaction clause. Pla intiff contends the district court should have applied an objective “reasonableness” s tandard, while Sonat defends the court’s use of a subjective “good faith” standa rd. We need not resolve this uncertain question of state law. Both parties have argued points involving each standard. Indeed, plaintiff’s insistence on an obj ective standard is peculiarly at odds with his substantial reliance on allegations o f pretextual--i.e., subjectively1 Uncontroverted testimony established both the envir onmental rigor and

commercial rationale for Sonat’s internal standards

.
2 Davis Trust employee Oran Hall likewise expressed aconclusory opinion generally discounting the environmental problems in volved without even addressing Sonat’s environmental standards. -4- improper--conduct. In any event, under either stan dard the evidence of record warrants the entry of summary judgment in favor of Sonat. It is undisputed that the decision to withdraw Sonat’s $600,000 purchase offer was made exclusively by David Minor, Sonat’s vice president and manager of its mid-continent region. Minor assertedly base d his decision on (1) the substantial cost of bringing the properties up to S onat’s high environmental standards 1 (estimated at $157,000), and (2) the potential forfuture environmental liabilities, particularly relating to groundwater c ontamination. These reasons match the documented findings and recommendation of Sonat’s operations group, which was specifically responsible for the assessme nt of environmental problems in connection with proposed acquisitions. The affi davit submitted by plaintiff’s expert, who conceded “a strong possibility that one or more violations of the Clean Water Act has occurred or will occur” and fai led even to address the substantial cost of bringing the properties up to S onat’s own standards, 2 does not effectively undercut Sonat’s unfavorable environmental assessment of the properties and consequent withdrawal of its purchas e offer. Accordingly, we hold as a matter of law that the pertinent testimonial e vidence and documentation-5-

relating thereto demonstrate an objectively reasona ble basis for Sonat’s withdrawal of its purchase offer. We also agree with the district court’s rejection o f plaintiff’s pretext evidence. The excerpts from plaintiff’s own deposi tion ascribing concealed, improper motivations to Sonat reflect nothing more than his self-described “assumptions” and “feelings,” admittedly lacking insupporting information or documentation. Essentially the same is true of the testimony plaintiff relies on from two Sonat acquisition personnel, who personall y disagreed with the operations group’s recommendation to terminate the transaction they had been working to consummate. Since the pertinent environ mental assessment fell within the expertise and responsibility of the operations group, whose recommendation was adopted by a separate executive decisionmaker, the contrary opinions of the acquisition employees does not evidence either obje ctive or subjective bad faith. Finally, in both his deposition testimony and appel late briefing, plaintiff maintains that Sonat’s improper motivation may be i nferred from its refusal to renegotiate the purchase contract with suitable con cessions from Davis Trust to accommodate the environmental deficiencies found. This contention misconceives the nature and function of the satisfa ction clause included in the parties’ agreement. The nonfulfillment of this con dition precedent did not simply afford Sonat a bargaining advantage in some mandato ry contract modification-6-

negotiations, but, rather, discharged Sonat’s oblig ations (and Davis Trust’s corresponding rights) under the agreement altogethe r. See, e.g. , Smith , 558 P.2d at 1162; Sunray DX Oil Co. v. Great Lakes Carbon Co rp. , 476 P.2d 329, 336-37 (Okla. 1970); McDaniel v. McCauley , 371 P.2d 486, 488 (Okla. 1962). The judgment of the United States District Court fo r the Northern District of Oklahoma is AFFIRMED.

Entered for the Court

John W. Lungstrum District Judge