Opinion ID: 521553
Heading Depth: 2
Heading Rank: 1

Heading: Principles of Contract Construction

Text: 10 As previously noted, in the instant case, the district court concluded as a matter of law that Phillips did not breach the operating agreement between the parties. In so concluding, the district court determined that neither Phillips nor Fuller raised any allegation of ambiguity regarding the language contained in the operating agreement. The fact that the district court did not consider there to be an issue of ambiguity in the instant contractual dispute is significant since this Court characterizes the determination by a district court of the non-ambiguity of a contract as a conclusion of law and accordingly, reviews that conclusion de novo. Southern Natural Gas Co. v. Pursue Energy, 781 F.2d 1079, 1081 (5th Cir.1986). 11 It is well established that the primary concern of a court in construing a contract is to ascertain and give effect to the intent of the parties as expressed in the contract. Gracia v. RC Cola-7-Up Bottling Co., 667 S.W.2d 517, 520 (Tex.1984). Further, objective, not subjective, intent of the parties controls and, in the absence of an allegation of ambiguity as to the contract language, the instrument alone will be deemed to express the intent of the parties. Phillips v. Inexco Oil Co., 540 S.W.2d 546, 548 (Tex.Civ.App.--Tyler 1976, writ ref'd n.r.e). Applying Texas principles of contract construction which govern the instant diversity action, it is noted that Texas courts have stated the following regarding the implication of additional contractual obligations from the express terms of a written agreement: 12 In order for a court to read additional provisions into the contract, the implication must clearly arise from the language used, or be indispensable to effectuate the intent of the parties. It must appear that the implication was so clearly contemplated by the parties that they deemed it unnecessary to express it. 13 Kutka v. Temporaries, Inc., 568 F.Supp. 1527, 1535 (S.D.Tx.1983). We now apply the above legal principles to the specific assertions made by Fuller in the instant appeal.