Opinion ID: 71990
Heading Depth: 2
Heading Rank: 2

Heading: Attorneys' fees to Gulf Copper.

Text: Gulf Copper alleges two grounds that require an award of attorneys' fees. It first asserts that the following part of the indemnity language in the contract so requires: Should any claim for loss, damage or expense be raised against any indemnitee. . . [t]he indemnitor shall assume the defense of such claim. Second, Gulf Copper claims that Texas law would require TODCO to pay its fees. See Tex. Civ. Prac. & Rem.Code Ann. § 38.001. We review a district court's discretionary determinations on the amount of an award of attorneys' fees for an abuse of that discretion. Riley v. City of Jackson, Miss., 99 F.3d 757, 759 (5th Cir.1996). However, the interpretation of whether contract language permits fees is a question of law reviewed de novo. Alliance Health Group, LLC v. Bridging Health Options, LLC, 553 F.3d 397, 399 (5th Cir. 2008). Gulf Copper's first argument for the award of attorneys' fees is based on contractual language requiring the indemnitor  TODCO, as we have held  to assume the defense of any suit against the indemnitee, Gulf Copper. The relevant language is in Paragraph 5.2(e), as follows: Should any claim for loss, damage or expense be raised against any indemnitee under any provision of this Agreement, the indemnitor shall be promptly informed of same by the party against whom the claim is being made. No claim shall be settled without the written approval of the indemnitor. The indemnitor shall assume the defense of such claim. Texas law requires indemnity agreements to be construed under the normal rules of contract construction. Associated Indem. Corp. v. CAT Contracting Inc., 964 S.W.2d 276, 284 (Tex.1998) (citation omitted). Therefore, the primary concern of courts is to ascertain and to give effect to the intentions of the parties as expressed in the instrument. Ideal Lease Serv., Inc. v. Amoco Prod. Co., Inc., 662 S.W.2d 951, 953 (Tex.1983) (citations omitted). Where a provision is unambiguous, we determine the rights of the parties by giving legal effect to the contract as written. Id. We have already determined that the responsibility to indemnify, found in Paragraph 5.2(b), applies to suits between the parties. The most fundamental reason is because the point was uncontested in the district court and therefore must remain uncontested now. The separate section on a duty to defend, Paragraph 5.2(e), requires the indemnitee to give notice of claims to TODCO. That language serves no purpose when the claim is by the indemnitee itself. We do not see fatal ambiguity to arise from that fact. Because the parties agreed (until the appellate reply brief) that the separate indemnity provision would apply to third party claims as well as to claims between the contracting parties, we interpret the provision specifically addressing the processing of such claims in that light. It is true that Paragraph 5.2(e) could have drawn a distinction, and said that if the claim is by a third party, that notice must be given. The failure to do so does not make the notice provision surplusage. The notice requirement becomes a provision that applies to some but not all the circumstances in which indemnity may be owed. For others, the notice language is unimportant though technically still applicable. A contrary interpretation, namely, that indemnity is owed even when the claims are between the contracting parties but attorneys' fees are not, creates a significant interpretive problem. The first sentence in Paragraph 5.2(e) begins this way: Should any claim for loss, damage or expense be raised against any indemnitee under any provision of this Agreement, the notice to the indemnitor is to be given. In light of the concession that indemnity is owed even between the parties, such a claim would be a claim for loss . . . against the indemnitee under Paragraph 5.2(e). Our interpretation makes the required notice useless if the claim is between the parties, though certainly it could be given despite the obvious folly of doing so. The interpretation TODCO seeks requires adding to the first clause of Paragraph 5.2(e) a significant limitation, namely, that any claim for loss, damage or expense raised against any indemnitee actually means only such claims as are not between the parties. It seems to us such an interpretation does considerably more violence to the structure of the indemnity section than does a holding that the assumption of defense language contains a notice requirement that only has to be employed when it is useful to do so. Consequently, the indemnitor is to assume the defense of any claim raised under any provision of this Agreement. Because Gulf Copper's indemnity claim arose under the contract, it is entitled to the costs of its defense under this provision. The district court denied attorneys' fees. We REVERSE and REMAND for proceedings consistent with this opinion. We AFFIRM in all other respects.