Opinion ID: 535620
Heading Depth: 1
Heading Rank: 1

Heading: jurisdiction

Text: 27 The jurisdictional issues in this case require us to continue this Homeric Odyssey for yet a few more pages. They center on the meaning of various provisions in 28 U.S.C. Section 158. Section 158 provides: 28 (a) The district courts of the United States shall have jurisdiction to hear appeals from final judgments, orders, and decrees, and with leave of the court, from interlocutory orders and decrees, of bankruptcy judges entered in cases and proceedings referred to the bankruptcy judges under section 157 of this title. 5 An appeal under this subsection shall be taken only to the district court for the judicial district in which the bankruptcy judge is serving. 29       30 (c) An appeal under subsections (a) and (b) 6 of this section shall be taken in the same manner as appeals in civil proceedings generally are taken to the courts of appeals from the district courts and in the time provided by Rule 8002 of the Bankruptcy Rules. 7 31 (d) The courts of appeals shall have jurisdiction of appeals from all final decisions, judgments, orders, and decrees entered under subsections (a) and (b) of this section. 32 River Production argues that this court lacks jurisdiction to hear this appeal because the Trustee did not comply fully with Section 158. River Production argues that Section 158(a) governs jurisdiction for a first appeal in a bankruptcy case, whether from a bankruptcy court to a district court or from a district court hearing a bankruptcy case to a court of appeals. Pointing out that Section 158(a) expressly grants jurisdiction for appeals from bankruptcy courts to district courts, River Production argues that Section 158(a) impliedly grants jurisdiction for appeals from district courts sitting as trial courts in bankruptcy cases to courts of appeals because district courts function in these cases just like bankruptcy courts. In such cases, the district court decision, like bankruptcy court decisions, are entered under Section 158(a). This interpretation, River Production argues, insures the rapid decision-making the Bankruptcy Code envisions in bankruptcy cases. 33 In this case, River Production argues, the district court acted as a bankruptcy trial court because it tried a bankruptcy matter (as opposed to reviewing a bankruptcy matter on appeal from a bankruptcy court). Because the district court acted as a bankruptcy trial court rather than a bankruptcy appellate court, its decision is a decision under Section 158(a). Appeals from decisions entered under Section 158(a) must comply with the time limits established by Section 158(c). The Trustee filed his appeal after the time limit imposed by Section 158(c) expired. The time limit is jurisdictional and cannot be waived. Therefore, River Production concludes, this court lacks jurisdiction to hear the Trustee's appeal. 34 In the alternative, River Production argues that if Section 158(a) does not govern jurisdiction over the appeal from the district court's decision, 28 U.S.C. Section 1291 does. However, unlike an ordinary appeal under Section 1291, Fed.R.App.P. 4(a) does not establish the time limit for appeal, says River Production. 8 Instead, Section 158(c) establishes the time limits for appeal from the district court order. Because the Trustee did not appeal within the time limits imposed by Section 158(c), River Production concludes, this court lacks jurisdiction. 35 Section 158(a). Section 158(a) expressly grants district courts jurisdiction to hear appeals from bankruptcy courts' decisions. Section 158(a) states that district courts ... shall have jurisdiction to hear appeals ... from ... orders and decrees [ ] of bankruptcy judges for cases referred by district courts to bankruptcy judges under Section 157(a). See In re Louisiana World Exposition, 832 F.2d 1391, 1394-1395, (5th Cir.1987). 36 However, Section 158(a) does not discuss the role of district courts in cases not referred to bankruptcy courts under Section 157(a). Because it does not, we conclude that when district courts act as bankruptcy trial courts, i.e., when they do not review bankruptcy court decisions, Section 158 does not apply. See Louisiana World Expo., 832 F.2d at 1395, n. 3. In this case, the district court sat as a bankruptcy trial court rather than as a bankruptcy appellate court. Therefore, Section 158(a) does not govern the Trustee's appeal to this court from the district court's decision. 37 Section 158(a)'s failure to mention must less expressly grant courts of appeals jurisdiction to hear any appeals supports our interpretation. Section 158(a) does not discuss appeals from either district court bankruptcy trial decisions or district court bankruptcy appellate decisions. Therefore, we will not assume that Congress intended Section 158(a) to govern any appeals from district courts to courts of appeals. 9 38 Section 158(c). Section 158(c) creates an appellate structure for appeals from bankruptcy courts to district courts that parallels the appellate structure for appeals from district courts to courts of appeals. 10 However, Section 158(c) grants litigants just ten days to appeal from bankruptcy court decisions to district courts. See Bankr.R. 8002. In normal civil appeals, parties have 30 days to appeal. See Section 1291 and Fed.R.App.P. 4(a)(1). 39 Because Section 158(c) establishes appellate procedure only for appeals from bankruptcy courts to district courts, Section 158(c) does not establish the time limit for appeals to courts of appeals. See 1 Collier on Bankruptcy, para. 3.03 (15th ed. 1989). Section 158(c) does not govern appeals to courts of appeals even when district courts sit as bankruptcy trial courts rather than bankruptcy appellate courts. Because the Trustee appeals to this court rather than to a district court, this appeal does not fall within Section 158(a). Therefore, the Trustee need not comply with Section 158(c). Instead, he must comply with Rule 4(a)(1). The Trustee filed a timely appeal under Rule 4(a)(1). Therefore, we have jurisdiction over his appeal. 40 Previous cases support this interpretation. While we have never decided this issue, we have assumed that Rule 4(a)(4 ) establishes the time limits for interlocutory appeals from district court orders in bankruptcy matters originating in district courts. Browning v. Navarro, 887 F.2d 553, 557 (5th Cir.1989). We have not decided whether Section 158(c) establishes time limits for appeals to courts of appeals, whether from district court bankruptcy appellate decisions or from district court bankruptcy trial decisions. 41 Section 158(d). This last provision is the first and only provision in Section 158 that governs appeals to courts of appeals. Section 158(d) limits its jurisdictional grant solely to courts of appeals. It does not grant jurisdiction to district courts reviewing decisions in cases referred to bankruptcy courts under Section 157(c) even though those district courts function as first line courts of appeals in those cases. 11 Nor does Section 158(d) grant jurisdiction to district courts sitting as bankruptcy trial courts. Instead, Section 158(d) expressly grants jurisdiction to courts of appeals over decisions entered under Section 158(a) and (b). See In re Amatex Corp., 755 F.2d 1034, 1038 (3rd Cir.1985). Decisions entered under Section 158(a) and (b) are decisions rendered by district courts sitting as appellate courts reviewing bankruptcy court decisions. See discussion above; In re Benny, 791 F.2d 712, 716, 718 (9th Cir.1986), (rejecting In re Teleport Oil Co., 759 F.2d 1376 (9th Cir.1985) (per curiam )). Therefore, Section 158(d) grants jurisdiction to courts of appeals over appeals from district courts' bankruptcy appellate decisions. See In re Greene County Hospital, 835 F.2d 589, n. 2 (5th Cir.1988); In re Phillips, 844 F.2d 230, 233 (5th Cir.1988); Louisiana World Expo., 832 F.2d at 1394-1395; In re Koerner, 800 F.2d 1358, 1360 (5th Cir.1986). 42 Section 158(d) does not expressly govern jurisdiction over all bankruptcy cases reviewed by courts of appeals. Section 158(d) refers only to matters entered under Section 158(a) and (b). Section 158(d) does not govern appeals to courts of appeals in those cases where the decision appealed was not entered under Section 158(a). Benny, 791 F.2d at 716. When district courts decide bankruptcy matters firsthand, they do not enter their decisions under Section 158(a). Therefore, Section 158(d) does not grant us jurisdiction to hear those appeals. Louisiana World Expo., 832 F.2d at 1395, n. 3; Koerner, 800 F.2d at 1360; Amatex, 755 F.2d at 1035; Browning, 887 F.2d at 557. 12 Relationship between Section 158 and Section 1291. 43 Section 1291 governs appeals to courts of appeals when district courts act as bankruptcy trial courts rather than as bankruptcy appellate courts. Benny, 791 F.2d at 718; In re Salem Mortgage Co., 783 F.2d 626, 632, n. 15 (6th Cir.1986); Amatex, 755 F.2d at 1038; Browning, 887 F.2d at 557; cf. Teleport, 759 F.2d at 1378. Section 158(d) governs appeals to courts of appeals when district courts sit as bankruptcy appellate courts rather than as bankruptcy trial courts. Louisiana World Expo., 832 F.2d at 1395, n. 3; see also Amatex, 755 F.2d at 1038. Bankruptcy decisions that do not fall within the scope of Section 158(a) reach courts of appeals through Section 1291. They must reach courts of appeals through Section 1291 because Section 158(d) governs courts of appeals' jurisdiction only for cases falling within the scope of Section 158(a). (See discussion above.) 44 However, we recently stated without explanation that Section 1291 grants jurisdiction to this court to hear an appeal from a district court decision where the district court functioned as an bankruptcy appellate court, i.e., an appeal to this court entered under Section 158(a). Texas Research, 862 F.2d at 1162. We did not state that Section 158(d) does not apply as well. Like many other courts, we apparently assumed that Section 1291 provides bankruptcy appellate jurisdiction without considering whether Section 158 supercedes or supplements Section 1291. See, e.g., In re King Memorial Hospital, 767 F.2d 1508 (11th Cir.1985) (per curiam ); Teton Exploration Drilling v. Bokum Resources, 818 F.2d 1521, 1524 (10th Cir.1987); In re Martin-Trigona, 763 F.2d 135, 138 (2d Cir.1985); John E. Burns Drilling Co. v. Central Bank of Denver, 739 F.2d 1489, 1491-1492 (10th Cir.1984) (per curiam ). 45 Because we did not discuss the scope of Section 158(d), the decision leaves us free to conclude that Section 158(d) as well as Section 1291, govern jurisdiction over appeals to us from district court bankruptcy appellate decisions. Other courts have done the same, finding that Section 158(d) concurrently grants jurisdiction along with Section 1291 to courts of appeals over decisions entered by district courts under Section 158(a) or that whether or not bankruptcy decisions fall within section 158(a), Section 1291 serves as an alternative basis for jurisdiction. See, e.g., Salem, 783 F.2d at 632 & n. 15 (rejecting the Teleport decision that Section 158 serves as the exclusive basis of appellate jurisdiction in bankruptcy). Our conclusion also accords with the legislative history. At one point Congress proposed that Section 1291 serve as the source of courts of appeals' jurisdiction over matters previously heard by district courts sitting as bankruptcy appellate courts. S.Rep. No. 989, 95th Cong., 2d Sess. 18, reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5804; Salem, 783 F.2d at 632, n. 15. 46 In contrast to Texas Research, in Barrier, we cited Section 158(d) for the proposition that this court exercises jurisdiction over all decisions of district courts in bankruptcy matters. Barrier, 776 F.2d at 1299. We held that courts of appeals cannot hear interlocutory orders in bankruptcy cases under 28 U.S.C. Section 1292. Instead, Section 158 governs. We stated without explanation that Section 158, which appears to be comprehensive, clearly supercedes [ ] Section 1291, covering appeals from final judgments of the district court. Barrier did not decide whether Section 158(d) or Section 1291 grants jurisdiction over appeals from district courts hearing bankruptcy matters not covered by Section 158(a) and (b). Id. See also First South Savings, 820 F.2d at 708 (district court refused to stay a bankruptcy order pending appeal). We cited Teleport, 759 F.2d 47 1376; 13 and Regency Woods Apartments, Ltd., 686 F.2d 899 (11th Cir.1982) 14 for our interpretation of Section 158. See also In re Chateaugay Corp., 838 F.2d 59, 62-63 (2d Cir.1988), cert. granted by Pension Ben. Guar. Corp. v. LTV Corp., --- U.S. ----, 110 S.Ct. 321, 107 L.Ed.2d 311 (1989) (Section 158(d) exclusively grants jurisdiction to courts of appeals over decisions entered by district courts under Section 158(a)). 48 Barrier may have collapsed inadvertedly (1) bankruptcy cases on appeal from district court decisions reviewing bankruptcy court decisions with (2) bankruptcy cases tried by district courts and never referred to bankruptcy courts under Section 157(a). Barrier, 776 F.2d at 1299; see also Chateaugay, 838 F.2d at 62-63. Section 158(d) clearly grants courts of appeals jurisdiction over the former and just as clearly does not grant courts of appeals jurisdiction over the latter. 49 If we apply the standard announced in Barrier to all bankruptcy cases, we lack jurisdiction to review final district court orders in cases where district courts sit as bankruptcy trial courts. 15 Because we do not believe that Congress intended to limit courts of appeals' jurisdiction under Section 1291, we decline to follow Barrier to the extent it conflicts with our decision here today. Instead, we believe the better approach is that implicitly adopted in Texas Research. Both Section 1291 and Section 158 govern appeals to courts of appeals from district court decisions when district courts sit as bankruptcy appellate courts. Only Section 1291 governs appeals from district court decisions when district courts sit as bankruptcy trial courts. And in either case, Rule 4(a)(1) establishes the time limit for appeals, not Section 158(c). Elements of the Contract 50 We agree with the district court that the contract between River Production and the Trustee in this case consists of paragraph 14 of the bankruptcy court's order and the exhibits (the schedules of property assumed and a copy of the Letter Agreement) attached to the Trustee's motion. We disagree with the district court's conclusion that the motion itself does not constitute part of the contract between River Production and the Trustee. We construe the documents executed in connection with the sale together (see In re Olm Associates, 98 B.R. 271 (Bankr.N.D.Tex.1989)) and consider the entire contract to give effect to all provisions, so that none will be meaningless. Cambridge Oil Co. v. Huggins, 765 S.W.2d 540 (Tex.App.--Corpus Christi 1989); Birdwell v. Ferrell, 746 S.W.2d 338 (Tex.App.--Austin 1988). If provisions conflict, we must harmonize them. See KMI Continental Offshore Production Co. v. ACF Petroleum Co., 746 S.W.2d 238 (Tex.App.--Hous.1987). 51 Either the motion and its attached exhibits constitute part of the contract or neither the motion and its attached exhibits constitute part of the contract. To conclude otherwise unfairly stacks the deck in favor of River Production. River Production had access to all of these materials. Therefore, we find, as a matter of law, that the Trustee's motion and attached exhibits and the bankruptcy court's order constitute the contract between River Production and the Trustee. Termination of the Contract 52 Interpreting the language of the contract is a question of law. Browning v. Navarro, 743 F.2d 1069 (5th Cir.1984). Even in bankruptcy proceedings, courts of appeals look to state law to decide contract issues. Shaw v. Dawson, 48 B.R. 857 (D.C.N.M.1985). 53 We agree with the district judge that River Production could terminate the contract only if the parties failed to close within eleven days after the bankruptcy judge entered the order approving the sale. We also agree with the district judge that the sale did not close on time. However, we part company with the district judge after this point. Unlike the district judge, we do not find that River Production timely terminated the contract. 54 River Production did not tender its termination until July 27, 1987, exactly two months after the bankruptcy court entered its order approving the sale. Because River Production waited two months after the bankruptcy court entered its order before it attempted to rescind the contract, River Production waived the right to do so. See Cotten v. Deasey, 766 S.W.2d 874 (Tex.App.-Dallas 1989) (even if the contract specifies an exact date, the parties can waive it). In the alternative, we find that the parties extended the time to perform the contract from eleven days after the bankruptcy court entered its order to eleven days after the order was finalized. See Id.; Hage v. Westgate Square Commercial, 598 S.W.2d 709 (Tex.Civ.App.1980) (even when time is of the essence by express stipulation, parties may extend stipulated time limit by waiving strict compliance). The Trustee was prepared to close at the later date. 55 River Production's own termination letter bolsters our conclusion. Rather than citing the provision to close within eleven days after the bankruptcy court entered its order, River Production cited the clause allowing B/C to terminate the contract if the sale did not close by March 30, 1987. Only later did River Production argue that it terminated the sale because the sale did not close within eleven days after the bankruptcy court entered its order. Mutual Mistake 56 Under Texas law, mutual mistake occurs when both parties to a transaction believe in the present existence of the thing contracted for, that thing is material to the transaction, and that thing does not exist. Horner v. Bourland, 724 F.2d 1142, 1145 (5th Cir.1984). 57 In this case, the district court found that the Trustee mistakenly listed certain assets in the schedules attached to his motion, that River Production relied on those schedules, and that as a result, both the Trustee and River Production mistakenly believed that the sale conveyed more property than it in fact did. Accordingly, the district court held that the River Production could rescind the contract on the ground of mutual mistake. 58 We do not dispute the district court's finding that the leases listed on the exhibits attached to the motion were material to the transaction. Nor do we doubt that some of those leases expired by April 16th. However, we disagree with the district court's finding that both parties believed that every lease listed in the exhibit had not expired. 59 Based on our review of the record, we find that both the Trustee and River Production recognized that many of the leases listed on the exhibits attached to the Trustee's motion had expired and hence could not be assigned to River Production. Both parties acknowledged uncertainty over what the Trustee would convey to River Production. In fact, the transaction assumed that lack of knowledge. River Production cannot both pay a lower price due to uncertainty over the assets transferred and set aside the sale for that same reason. 60 While the Trustee could have more clearly indicated in the schedules that Topco may or may not possess interest in the oil and gas wells listed, the Trustee clearly stated elsewhere in the motion itself and in the Letter Agreement that he intended to assume and assign only those unexpired leases in which Topco had an interest to convey. River Production read the motion and the Letter Agreement, and therefore knew or should have known the precarious status of Topco's interest in the wells listed. In addition, the record repeatedly shows that River Production expressly acknowledged that it did not know exactly what it was purchasing. Therefore, we find no mutual mistake. Misrepresentation or Fraud 61 In order to rescind the contract for misrepresentation or fraud, River Production must prove that the Trustee intentionally misrepresented a material fact, River Production reasonably relied on that representation, and the reliance injured River Production. See Citizens Standard Life Ins. Co. v. Muncy, 518 S.W.2d 391, 394 (Tex.Civ.App.1974). If River Production established these elements at trial, River Production may void the contract. Id. 62 Intentional misrepresentation. The district court found that the Trustee intentionally misrepresented the material fact that many of the leases listed on the schedules attached to the motion had expired. The district court based this conclusion on its finding that the Trustee had access to monthly operating reports, the Trustee's agents knew about defaults in the leases, and the agents' knowledge should be imputed to the Trustee. In addition, the district court found that even if the Trustee did not know about the defaults, he should have known, and therefore would be responsible for any misrepresentations. 16 63 We agree with the district court that paragraph 5 of the Trustee's motion, if read alone, misleads prospective purchasers by intimating that Topco holds more property interests than it may have held. We do not want to criticize the Trustee's language too harshly, however. The Trustee did not offer this motion to solicit offers from prospective purchasers. Instead, believing that Section 365(c) applied to these property interests, 17 the Trustee submitted this motion to the bankruptcy court in order for the court to approve a sale ready to close pending court approval. To obtain court approval, the Trustee listed every leasehold in which Topco possibly had interest. Had he been more exacting and not listed questionable leases, the Trustee would not have the right to assign those interests to the purchaser, because he would lack court approval for the properties not listed. The Trustee also attempted to comply with Section 365(c) by alleging that no defaults existed in the leases and that B/C could perform the Trustee's obligations under the lease. 64 However, the Trustee did not act as carefully as he could have. He could have requested authorization to transfer all leases listed in the attached exhibit that had not yet expired. He also could have alleged that no defaults existed in those leases that had not yet expired. The Trustee also could have inserted in the final document memorializing the sale a provision that River Production did not rely on anything in the Trustee's motion or attached exhibits, but instead relied on its own inspection of the properties to be conveyed. Nevertheless, the Trustee's failure to take these steps does not amount to intentional misrepresentation. 65 Our conclusion accords with the purpose of Section 365. On the one hand, Congress designed Section 365 to relieve debtors from obligations. See In re Holland Enterprises, 25 B.R. 301 (D.C.N.C.1982); In re LHD Realty Corp., 20 B.R. 717 (Bankr.S.D.Ind.1982), decided by 726 F.2d 327 (7th Cir.1984). On the other hand, Congress designed Section 365 to give debtors means to force others to continue to do business with them when bankruptcy filing might discourage them from doing so. Richmond Leasing, 762 F.2d 1303. In effect, Section 365 allows debtors to pick and choose among their agreements and assume those that benefit their estates and reject those that do not. In re G-N Partners, 48 B.R. 462 (Bankr.D.Minn.1985). Congress did not design Section 365 to ensure that purchasers buy wisely or to protect their interests if they do not. 66 In this case, the Trustee used this provision to bring money into the bankrupt estate by selling Topco's interests in oil and gas wells. River Production now points to these various representations, made not to solicit offers for the property, but to obtain approval for a transaction ready to close, as grounds for rescinding the sale. We disagree with River Production's argument that the Trustee intentionally misrepresented the status of these assets. Nevertheless, we need not question any of these factual findings by the district court because we find that River Production did not reasonably rely on the Trustee's representations, if made. 67 Reasonable reliance. We do not question the district court's factual finding that River Production relied on representations made by the debtor during a two year period before the sale of the assets by the Trustee. We do question but need not decide whether River Production relied on the motion and the exhibits attached to the motion. However, we find that River Production could not reasonably rely on the representations made by the debtor, certain language in the motion, or the correctness of the property schedules attached to the motion, given the language in the Letter Agreement and the motion itself. Even if River Production could reasonably rely on the debtor's representations, certain language in the motion, or the correctness of the attached property schedules, it could not do so reasonably during the interval after it bid on the properties and before the bankruptcy court entered its order approving the sale. 68 River Production could not reasonably rely on the representations made by the debtor several years before the sale because River Production knew that the leases contained automatic expiration provisions if production ceased for more than sixty days. After River Production inspected those wells, Topco could have stopped production on wells due to lack of funds, thus triggering the sixty day clause. If Topco did not restart production during that sixty day period, Topco's interest in those wells automatically terminated. Any purchase would not include those wells on which production had ceased even though River Production saw those wells producing previously. 69 Even if River Production initially could reasonably rely on the debtor's representations, it could not do so after reviewing the Trustee's motion and attached exhibits, hearing testimony during the three days of hearings on the Trustee's motion, and examining appraisals submitted by the Trustee during the hearings. The motion and the Letter Agreement both clearly state that the Trustee intended to sell to B/C only whatever interests Topco held in the listed assets. Several witnesses at the hearing on the Trustee's motion testified that the properties were worth less than River Production bid and that many royalty owners were unhappy with Topco's performance. This testimony put River Production on notice that problems existed with some of the leases. 70 Even if River Production could reasonably rely on certain language in the motion and the Trustee's representations in the property schedules, it could not reasonably continue to rely on those schedules after it placed its bid and before the bankruptcy court issued its order approving the sale. During that period, a reasonable purchaser would inspect the properties purportedly included in the sale. If it had inspected the properties, River Production would have discovered that the Trustee misrepresented the status of the leases (if, in fact the Trustee did) and reported that fact to the bankruptcy court before it entered its order. If it had done so, the bankruptcy court, being a court of equity, may have rescinded the sale. River Production then had another week to investigate before the bankruptcy court entered the order. Apparently River Production did not investigate the properties or if it did investigate and discover misrepresentations, it did not notify the bankruptcy court. In either case, we find that River Production's continued reliance on the debtors and the Trustee's purported misrepresentations to be unreasonable given the circumstances. 71 Damages. Because we find that River Production could not reasonably rely on the debtor's representations and the property schedules, we need not reach the question of damages. However, we could not determine damages on the basis of the record before us. Testimony in the record supports a finding that the leases have increased in value because of rising gas prices. Because the record does not establish the value of the leases at the time of the sale, we could not determine what damage, if any, River Production purportedly sustained as a result of the Trustee's actions. 72 Waiver. Even if the Trustee's actions amount to misrepresentation or fraud, River Production waived its right to rely on the Trustee's representations. Paragraph 10 in the motion states that B/C (now River Production) agreed to waive any reliance upon information provided by the Trustee, his operator, or his attorneys regarding the assets to be sold. In addition, in the Letter Agreement itself, B/C agreed to purchase Topco's interests to the extent they existed. Finally, River Production itself acknowledged several times during the bankruptcy proceedings that it waived any reliance on any information provided. Failure of Consideration 73 Failure of consideration occurs when, because of some supervening cause after an agreement is reached, the promised performance fails. Stewart v. U.S. Leasing Corp., 702 S.W.2d 288 (Tex.App. 1 Dist.1985). Total failure of consideration constitutes a ground for rescission. Food Machinery Corp. v. Moon, 165 S.W.2d 773 (Tex.Civ.App.1942). Partial failure of consideration does not invalidate the contract but instead is a defense pro tanto. Huff v. Speer, 554 S.W.2d 259 (Tex.Civ.App. 1 Dist.1977). 74 The district court found wholesale failure of consideration because many of the oil and gas interests the Trustee purported to convey did not exist. However, the district court also found that the Trustee intended to convey some property to River Production. As a matter of law, that property constitutes partial consideration. Therefore, even though the district court called the Trustee's failure of consideration wholesale, the district court actually found partial failure of consideration. However, the Trustee attempted to convey no less than he promised--whatever interest Topco held in the properties listed. Therefore we find no failure of consideration. 75 Nor are we so sure that River Production purchased as little as it alleges. Testimony before the district court indicates that even though these leases contain automatic termination provisions, royalty owners who have not signed new leases will agree to reactivate the leases if the producer agrees to restart production. The Bankruptcy Code does not prohibit the Trustee from reactivating these leases. See In re Ted Liu's Szechuan Garden, 55 B.R. 8 (Bankr.D.Dist.Col.1985).