Court Opinion

ID: 2811958
Source: CourtListenerOpinion
Date Created: 2015-06-25 17:00:38.535871+00
Date Added: 2024-06-11T09:15:42.329253
License: Public Domain

NOT PRECEDENTIAL
                        UNITED STATES COURT OF APPEALS
                             FOR THE THIRD CIRCUIT
                                  _____________

                                       No. 12-3613
                                      _____________

                       WAYNE HARRISON; MARY HARRISON

                                             v.

                         CABOT OIL & GAS CORPORATION,
                                                   Appellant
                                _______________

                     On Appeal from the United States District Court
                         for the Middle District of Pennsylvania
                                (D.C. No. 3-10-cv-00312)
                        District Judge: Hon. Robert D. Mariani
                                   _______________

                      Submitted Under Third Circuit L.A.R. 34.1(a)
                                    April 24, 2015

             Before: JORDAN, SHWARTZ, and KRAUSE, Circuit Judges

                                   (Filed: June 25, 2015)
                                     _______________

                                        OPINION
                                     _______________

       
        This disposition is not an opinion of the full court and, pursuant to I.O.P. 5.7,
does not constitute binding precedent.
JORDAN, Circuit Judge

          Cabot Oil & Gas Corporation (“Cabot Oil”) appeals from the entry of summary

judgment in favor of Wayne Harrison and Mary Harrison on its counterclaim. We will

affirm.

          After briefing was completed in this appeal, we petitioned for certification of the

following question to the Supreme Court of Pennsylvania: “When an oil and gas lessor

files an unsuccessful lawsuit to invalidate a lease, is the lessee entitled to an equitable

extension of the primary lease term equal to the length of time the lawsuit was pending?”

Harrison v. Cabot Oil & Gas Corp., No. 12-3613, at 7 (3d Cir. Apr. 7, 2014). That Court

granted our petition and issued a thorough and thoughtful opinion on February 17, 2015.

In answering our question, the Pennsylvania Supreme Court declared, “We do not

foreclose that equitable relief may be available to oil-and-gas-producing companies –

subject to applicable requirements governing recourse to equity – where there is an

affirmative repudiation of a lease.” Harrison v. Cabot Oil & Gas Corp., 110 A.3d 178,

186 (Pa. 2015). But, the Court continued, “the mere pursuit of declaratory relief

challenging the validity of a lease does not amount to such.” Id. It explained that it “has

required more than the mere assertion of a challenge to the validity of an agreement to

demonstrate such repudiation. Under Pennsylvania law, anticipatory repudiation or

breach requires an ‘absolute and unequivocal refusal to perform or a distinct and positive

statement of an inability to do so.’” Id. at 184 (quoting 2401 Pa. Ave. Corp. v. Fed’n of

Jewish Agencies of Greater Phila., 489 A.2d 733, 736 (Pa. 1985)).

                                                2
       The Pennsylvania Supreme Court’s opinion effectively resolves the sole issue on

appeal. Cabot Oil’s counterclaim sought equitable relief based on the request in the

Harrisons’ amended complaint for a declaration that the lease was invalid.1 Because “the

mere pursuit of declaratory relief challenging the validity of a lease does not amount to

[repudiation],” id. at 186, the District Court properly granted summary judgment against

Cabot Oil on its counterclaim.

       Cabot Oil acknowledges that, in light of the Pennsylvania Supreme Court’s

decision, it cannot prevail on a theory of repudiation. But it argues that its counterclaim

is also based on a number of other equitable theories, including estoppel, unjust

enrichment, and avoidance of contractual forfeiture. Because the Commonwealth’s

Supreme Court did not address those alternative theories, Cabot Oil urges us to do so

now.

       Contrary to Cabot Oil’s assertion, however, its counterclaim was based solely, and

explicitly, on a theory of repudiation. In its briefing before us, Cabot Oil did briefly

discuss alternative theories that other jurisdictions have used to justify the equitable relief

it seeks, but its briefing focuses, appropriately, on the one theory actually alleged in its

counterclaim: repudiation. Other theories of relief are therefore not properly before us.

       1
         In their amended complaint, the Harrisons also sought, in the alternative, an
order compelling Cabot Oil to pay fair market value for the lease. But Cabot Oil only
alleged repudiation on the basis of the Harrisons’ request for declaratory relief. Thus any
claim of repudiation based the Harrisons’ request for just compensation has been
forfeited. See Josey v. John R. Hollingsworth Corp., 996 F.2d 632, 641-42 (3d Cir. 1993)
(treating as forfeited a claim that was neither raised in complaint nor added by
amendment).
                                               3
See Josey v. John R. Hollingsworth Corp., 996 F.2d 632, 641-42 (3d Cir. 1993) (treating

as forfeited a claim that was neither raised in complaint nor added by amendment).

      Accordingly, we will affirm the order of the District Court.

                                            4