AFFIRMED and Opinion Filed January 30, 2024 

S 

In The 

Court of Appeals 

Fifth District of Texas at Dallas 

No. 05-22-01314-CV 

REX PERFORMANCE PRODUCTS, LLC, Appellant 

V. 

SULZER CHEMTECH USA, INC., Appellee 

On Appeal from the 134th Judicial District Court 

Dallas County, Texas 

Trial Court Cause No. DC-17-05538 

MEMORANDUM OPINION 

Before Justices Partida-Kipness, Reichek, and Breedlove 

Opinion by Justice Reichek 

Rex Performance Products, LLC appeals the trial court’s judgment awarding 

Sulzer Chemtech USA, Inc. damages and attorney’s fees for Rex’s failure to pay for 

goods it accepted pursuant to a purchase contract. In two issues, Rex contends the 

trial court erred in granting Sulzer’s motion for directed verdict, and abused its 

discretion in determining the amount of attorney’s fees Sulzer was entitled to 

recover. We affirm the trial court’s judgment. 

 
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Background

 Rex is a foam production company. Sulzer sells foam manufacturing 

equipment. In July 2015, Rex contracted with Sulzer to purchase a foam extrusion 

unit (“FEU”) for $1,180,000 payable in four installments. Rex also purchased 

technical assistance for an additional $29,000. 

 The “Design Basis” portion of the purchase contract specified the FEU’s 

maximum output was 600 kilograms per hour. The contract’s “Performance 

Guarantee” included the following disclaimer: 

BUYER acknowledges that that SELLER does not give any 

PERFORMANCE GUARANTEE beyond the MECHANICAL 

GUARANTEE described in the paragraph 8.1. SELLER will design 

the requested EQUIPMENT to the best of its knowledge and know-how 

in order to meet the design basis described in paragraph 3, but SELLER 

shall not be liable for not matching any product or process performance. 

Paragraph 8.1, entitled “Mechanical Warranty,” stated 

 SELLER warrants that the [FEU] will be of the kind and quality 

as described in the QUOTATION and will be free of defects in 

workmanship and material. Excluded from SELLER’s warranty and 

liability for defects are all deficiencies which cannot be proved to have 

their origin in bad material, faulty design of the [FEU], e.g. deficiencies 

resulting from normal wear and tear, improper maintenance, failure to 

observe the operating instructions, or deficiencies resulting from other 

reasons beyond SELLER’s control. SELLER explicitly excludes any 

warranty for erosion, corrosion, and cavitation, except in case BUYER 

proves within 3 years from the delivery date of the [FEU] that the 

damage is caused by negligence in the choice of material of 

construction by SELLER . . . . 
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The purchase contract also contained two different sections addressing 

limitations of liability. Under the first section, the limitations on liability included 

the following: 

 SELLER’s liability for any damages relating to the 

EQUIPMENT delivered, intellectual property indemnity, or arising 

from SELLER’s performance under the CONTRACT . . . shall be 

limited to 25% of the purchase order price. Under no circumstances 

shall Seller be liable for re-call costs. . . . In no event shall SELLER be 

liable to BUYER for any indirect, punitive, special, incidental, or 

consequential damages in connection with the CONTRACT, including 

but not limited to, loss of profits or interruption of production, loss or 

opportunity or business. 

The second section, entitled “Overall Limitation of Liability,” stated, 

 NOTHWITHSTANDING ANYTHING TO THE CONTRARY 

IN THIS CONTRACT, INCLUDING ALL DOCUMENTS MAKING 

PART THEREOF AND TO THE MAXIMUM EXTENT 

PERMITTED BY LAW, IN NO EVENT SHALL SELLER BE 

LIABLE TO THE BUYER FOR LOSS OF PROFIT OR REVENUE 

LOSS OF USE INTERRUPTION OF PRODUCTION, COST OF 

CAPITAL, COST OF PURCHASED OR REPLACEMENT POWER 

AND ANY AND ALL COSTS RELATING TO DELAY, OR FOR 

INDIRECT, PUNITIVE, SPECIAL, INCIDENTAL, OR 

CONSEQUENTIAL DAMAGES OR CLAIMS BY THE BUYER’S 

CUSTOMERS FOR SUCH DAMAGES, IN CONNECTION WITH 

THIS CONTRACT, WHETHER SUCH LIABILITY IS BASED ON 

CONTRACT, TORT (INCLUDING NEGLIGENCE), STATUTE, OR 

ANY OTHER BASIS OF LEGAL LIABILITY. 

 THE REMEDIES OF BUYER SET FORTH HEREIN ARE 

EXCLUSIVE AND SELLER’S LIABILITY WITH RESPECT TO 

ANY CONTRACT, INDEMNITY, TORT (INCLUDING 

NEGLIGENCE), UNDER ANY WARRANTY, STRICT LIABILITY, 

OR OTHERWISE SHALL NOT EXCEED 100% OF THE 

CONTRACT PRICE UNLESS CLAIMS ARISE FROM GROSS 

NEGLIGENCE OR WILFUL MISCONDUCT OF THE SELLER. 
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Delivery of the FEU was estimated to be “approximately 24 weeks” after 

receipt of the first installment payment. Due to a delay in billing, the parties agreed 

the delivery time period would begin on July 13, 2015. A Sulzer employee testified 

the FEU was delivered twenty-two weeks later, on December 17. 

The FEU was tested by Rex under Sulzer’s supervision. The contract 

specified that if the results of the performance test did not meet the performance 

guarantee requirements, Sulzer would perform the necessary corrections. This 

process would be repeated “up to three (3) more times, until all the defects and 

deficiencies which are the causes of the insufficient performance are corrected and 

the results of the performance test meet the guarantee requirements.” If the FEU 

still failed to reach the performance parameters after four performance tests, Rex 

could reject the FEU and receive liquidated damages. Rex signed an acceptance 

form for the FEU on May 26, 2016. 

The Mechanical Warranty period for the FEU extended for twelve months 

from the date of the successful performance test, or eight months from the date of 

delivery. If during that time period Rex discovered the FEU was defective or not in 

conformity with the terms of the contract, it was to notify Sulzer and Sulzer was 

required to remedy the defects “without undue delay.” All corrections would be 

done at Sulzer’s cost, including transport expenses and services of specialists sent 

by Sulzer to carry out repairs. 
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At the time Rex accepted the FEU, it had paid approximately sixty percent of 

the amount owed under the contract. A week and a half after accepting the FEU, 

Rex sent an email to Sulzer stating “[t]he Line continues to run well and make nice 

foam. This is a very nice machine!” The email went on to discuss some issues with 

the FEU such as modem connectivity. 

On July 22, 2016, Rex sent a letter to Sulzer concerning payment of the 

remaining amount due under the contract. The letter stated “the cash situation at 

[Rex] is very tight at the moment.” Rex proposed a plan for payments to be made 

over the following six months. The letter commented that the “plant is currently 

running satisfactorily, and the equipment from Sulzer is running well.” Rex also 

stated it intended to expand in the future and was “quite satisfied with the Sulzer 

machinery and associated extrusion technology and confident it will enable us to 

produce the products that we need to for our planned market expansion.” 

On August 30, Sulzer notified Rex that its payments were past due. Rex 

responded on September 19 stating, 

We sincerely appreciate your patience and understanding during 

this process. Recently, we’ve become aware of additional defects 

within the new extrusion machine. These came to light during the latter 

part of August and have continued through Sulzer Chemtech’s on-site 

visit earlier this month. Once we have a firm idea of the magnitude 

these additional defects will have on our business, we will be in touch 

with you regarding a solution to the outstanding balance. 

Rex made no further payments to Sulzer. 
 –6– 

 Sulzer brought this suit in May 2017 asserting a claim against Rex for breach 

of contract. Sulzer sought to recover the full balance of $596,386.84 plus attorney’s 

fees and prejudgment interest. Rex filed an answer asserting numerous affirmative 

defenses, as well as counterclaims for breach of contract, breach of express warranty, 

breach of implied warranty of merchantability, breach of implied warranty of fitness 

for a particular purpose, and fraudulent and/or negligent misrepresentation. Rex 

alleged the FEU was “woefully underperforming” and could not safely produce the 

six hundred kilograms of foam per hour specified in the contract. Rex sought to 

recover actual, economic, and exemplary damages in addition to attorney’s fees and 

costs of suit. 

 Sulzer moved for a partial summary judgment on Rex’s claims for 

consequential damages arguing Rex had waived its right to recover such damages in 

the purchase contract. The trial court agreed and granted a partial judgment that Rex 

“take nothing on any claim of lost profits, including reduction-in-sales-price 

damages to the extent such claims are based upon consequential damages and not 

direct damages.” 

 The case was tried before a jury in August 2022. After Sulzer rested its case, 

Rex moved for a directed verdict on the ground that the purchase contract was 

illusory because there was no mutual obligation. Rex argued the wording of the 

guarantees did not obligate Sulzer to provide Rex with a properly functioning FEU. 

The trial court denied the motion. 
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 Sulzer made its own motion for a directed verdict after Rex rested its case. 

Following a hearing, the trial court directed a verdict in favor of Sulzer on all issues 

except the amount of damages Sulzer was entitled to recover. The court’s charge 

contained only a single question asking, 

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

and reasonably compensate Sulzer for their damages, if any, that 

resulted from Rex’s failure to comply with the contract? 

 The jury was instructed that, 

contract means the one or more agreements whereby Sulzer was to 

provide SULZER PE FOAM EXTRUSION UNIT for a capacity of 600 

kg/h for use in Rex’s business operations. 

The jury determined Sulzer was entitled to the full amount of damages it requested. 

 The trial court’s final judgment awarded Sulzer $596,386.84 in accordance 

with the jury’s verdict. The court additionally awarded Sulzer $372,803.49 in 

attorney’s fees. The judgement stated the court weighed the relevant factors in light 

of the evidence offered and determined the fees charged and time spent by Sulzer’s 

counsel were reasonable and necessary. The court further found that segregation of 

the fees was neither necessary nor warranted given the parties’ procedural postures 

and the nature of Rex’s defenses and counterclaims. Rex brought this appeal. 

Analysis

 In its first issue, Rex contends the trial court erred in denying its motion for 

directed verdict and granting a directed verdict in favor of Sulzer because the 

purchase contract was illusory and unconscionable. A contract is illusory if the 
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promisor retains the option of discontinuing performance without notice. Rogers v. 

Alexander, 244 S.W.3d 370, 382 (Tex. App.—Dallas 2007, pet. denied). A contract 

may also be illusory if a party is not entitled to recover damages under any 

circumstances. See Innovate Tech. Sols., L.P. v. Youngsoft, Inc., 418 S.W.3d 148, 

152 (Tex. App.—Dallas 2013, no pet.). Neither circumstance is presented here. 

 The purchase contract required Sulzer to deliver to Rex a FEU meeting the 

mechanical specifications set forth in the contract that was free of defects in 

workmanship and material.1

 If Sulzer failed to deliver a conforming product, Rex 

could decline to accept the FEU and recover damages. If defects were discovered 

after Rex accepted the FEU, Sulzer was required to repair the unit at its own cost. 

Nothing in the contract allowed Sulzer to unilaterally decline to perform these 

obligations. 

 Rex asserts the contract was illusory because it disclaimed any performance 

guarantee beyond the mechanical warranty. According to Rex, the disclaimer meant 

“Sulzer had no obligation other than to deliver anything it deemed a PE Foam 

Extrusion Unit” and could have delivered a “bag of rocks” without incurring any 

liability. Rex’s interpretation of the performance guarantee ignores the language of 

the mechanical warranty which required Sulzer to deliver a FEU meeting the design 

specifications outlined in the contract. The disclaimer within the performance 

1

 Rex does not appeal the trial court’s directed verdict in favor of Sulzer on Rex’s claims for breach of 

contract and breach of express and implied warranties. 
 –9– 

guarantee does not render this requirement illusory. Parties are free to make 

disclaimers a part of the basis of the bargain to the extent allowed by law. See 

Welwood v. Cypress Creek Ests., Inc, 205 S.W.3d 722, 727 (Tex. App.—Dallas 

2006, no pet.). Rex does not contend the performance disclaimer was inconspicuous. 

Nor does it argue the disclaimer was impermissible under state law. 

 In support of its contention that the contract was unconscionable, Rex again 

relies on the performance guarantee disclaimer along with the contract’s limitations 

on liability. In general, the term “unconscionability” describes a contract that is 

unfair because of its overall one-sidedness or the gross one-sidedness of its terms. 

Arthur’s Garage, Inc. v. Racal-Chubb Sec. Sys., Inc., 997 S.W.2d 803, 815 (Tex. 

App.—Dallas 1999, no pet.). A determination of unconscionability usually requires 

a showing that the contract is both procedurally and substantively unconscionable 

when made. BDO Seidman, LLP v. J.A. Green Dev. Corp., 327 S.W.3d 852, 858 

(Tex. App.—Dallas 2010, no pet.). Whether a contract is procedurally 

unconscionable focuses on the facts surrounding the bargaining process. Arthur’s 

Garage, 997 S.W.2 at 815. Substantive unconscionability is concerned with the 

fairness of the agreement itself. Id. 

Texas courts do not ordinarily inquire into the relative fairness of a contract’s 

terms. Venture Cotton Co-op v. Freeman, 435 S.W.3d 222, 228 (Tex. 2014). “A 

contract or contract provision is not invariably substantively unconscionable simply 

because it is foolish for one party and very advantageous to the other. Instead, a 
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term is substantively unreasonable where the inequity of the term is so extreme as to 

shock the conscience.” Besteman v. Pitcock, 272 S.W.3d 777, 789 (Tex. App.—

Texarkana 2008, no pet.) (quoting Anaheim Indus. v. GMC, No. 01-06-00440-CV, 

2007 WL 4554213, at *9 (Tex. App.—Houston [1st Dist.] Dec. 20, 2007, pet. 

denied). Because of this state’s strong policy favoring the freedom to contract, there 

is a high threshold to prove unconscionability. Id. 

None of the factors that might weigh in favor of unconscionability are present 

in this case. Rex concedes in its brief that the purchase contract was the result of an 

arms-length transaction and it makes no assertions that the parties did not have equal 

bargaining power. Rex argues instead that it believed the contract promised the FEU 

would consistently produce at its maximum capacity of six hundred kilograms of 

foam per hour. This assumption is belied by the performance guarantee disclaimer. 

The fact that Rex subjectively believed the contract promised something it did not 

does not render the contract unconscionable. See El Paso Field Servs., L.P. v. 

MasTec N. Am., Inc., 389 S.W.3d 802, 811–12 (Tex. 2012) (court’s role is to enforce 

contract’s allocation of risk and parties are obligated to protect themselves by 

reading what they sign). 

Rex further contends the contract is unconscionable because it “eliminates 

every available avenue of damages” that Rex could recover from Sulzer for breach 

of contract. This argument is, again, belied by the contract’s language which permits 

several forms of recovery if Sulzer fails to deliver a FEU meeting the contract’s 
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design specifications. The only form of damages that is foreclosed by the contract 

is consequential damages. Contractual limitations on the recovery of consequential 

damages are not only not unconscionable, they are not unusual. See, e.g., Cherokee 

Cnty. Cogeneration Partners, L.P. v. Dynegy Mktg. and Trade, 305 S.W.3d 309, 314 

(Tex. App.—Houston [14th Dist.] 2009, no pet.). 

Based on the foregoing, we conclude the purchase contract was not illusory 

or unconscionable. We resolve Rex’s first issue against it. 

In its second issue, Rex contends the trial court abused its discretion in 

awarding Sulzer unreasonable and unrecoverable attorney’s fees. Rex argues the 

fees awarded were unreasonable because the billing records submitted into evidence 

showed Sulzer’s attorneys spent time on what Rex characterizes as “delay tactics” 

and unnecessary matters such as resisting discovery. We accord considerable 

deference to a trial court’s findings regarding whether prevailing counsel’s claimed 

hours are excessive, redundant, or unreasonable. El Apple I, Ltd. V. Olivas, 370 

S.W.3d 757, 763–64 (Tex. 2012). “The trial court possesses a superior 

understanding of the case and the factual matters involved” and is in the best position 

to determine from the context of the case whether a party’s filings are groundless or 

brought merely for the purpose of delay. See id. at 764. After reviewing the record, 

we conclude the trial court did not abuse its discretion in concluding all the work 

performed by Sulzer’s counsel was reasonable and necessary. 
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Rex additionally contends the trial court improperly awarded Sulzer 

attorney’s fees for work performed in connection with defending against Rex’s 

counterclaims. But such fees are recoverable when, as in this case, the prevailing 

party in a breach of contract case was required to defeat the opposing party’s 

counterclaims to recover fully on its own claim. Bullet Trap, L.L.C. v. Waterproof 

Positive, LLC, No. 05-18-00529-CV, 2019 WL 3543579, at *7–8 (Tex. App.—

Dallas Aug. 5, 2019, pet. denied) (mem. op.). The facts and legal theories supporting 

both Sulzer’s contract claim and Rex’s counterclaims were heavily, if not 

completely, intertwined. The trial court did not err, therefore, in concluding Sulzer 

was entitled to recover all of its attorney’s fees. We resolve Rex’s second issue 

against it. 

We affirm the trial court’s judgment. 

 

 

 

221314F.P05 

 

/Amanda L. Reichek/

AMANDA L. REICHEK 

JUSTICE 
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S 

Court of Appeals 

Fifth District of Texas at Dallas 

JUDGMENT 

REX PERFORMANCE PRODUCTS 

LLC, Appellant 

No. 05-22-01314-CV V. 

SULZER CHEMTECH USA, INC., 

Appellee 

 On Appeal from the 134th Judicial 

District Court, Dallas County, Texas 

Trial Court Cause No. DC-17-05538. 

Opinion delivered by Justice 

Reichek. Justices Partida-Kipness 

and Breedlove participating. 

 In accordance with this Court’s opinion of this date, the judgment of the trial 

court is AFFIRMED. 

 It is ORDERED that appellee SULZER CHEMTECH USA, INC. recover 

its costs of this appeal from appellant REX PERFORMANCE PRODUCTS LLC. 

Judgment entered January 30, 2024