Court Opinion

ID: 9662266
Source: CourtListenerOpinion
Date Created: 2023-08-23 23:04:20.693679+00
Date Added: 2024-06-11T18:14:38.188136
License: Public Domain

MARGARET G. MIRABAL, Justice,
dissenting (Assigned).
I respectfully dissent. In my opinion, the trial court erred in ruling that, as a matter of law, the contract in question barred appellant’s claim for payment for overtime use of equipment on an hourly basis. Accordingly, we should sustain appellant’s first issue and reverse and remand this case for a new trial.
Analysis
It is clear from the contract that Exhibit “F” is an alphabetical fist of the different types of equipment Standard could use during its construction and maintenance work, and that it breaks down the rates Standard can charge for each type of equipment into four categories, which include, “Hourly (1),” “Daily (8),” “Weekly (40),” and “Monthly (176).” (Emphasis added.) In some instances, the parties agreed to assign certain types of equipment a “daily,” “weekly,” and “monthly” rate, and in others, the parties assigned only “hourly” rates. This is undisputed.
*629However, for a majority of the types of equipment, the parties inserted the abbreviation “N/A,” or “not applicable,” in the “hourly” column. Chevron argues that the term “N/A,” as it is used in the contract, demonstrates the parties’ intention that hourly rates were not to be charged for those items with an “N/A” in their “hourly” rate column, whether that hourly rate would have been for “straight” time or for “overtime.” Standard contends that the abbreviation “N/A” should be interpreted in conjunction with the numbers (1), (8), (40), and (176), which appear at the top of Exhibit “F.” Standard claims that the contract permits charges for the overtime use of equipment, regardless of the term “N/ A,” because the applicable overtime rates will depend entirely on how long a particular piece of equipment is used.
In support of its argument, Standard points to the construction industry’s general standards and trade practices in order to define what the term “N/A” means in connection with the numbers (1), (8), (40), and (176). The Associated Equipment Distributor’s (AED) Green Book,1 which sets forth rental rates for all types of equipment used in the construction industry, was admitted into evidence at the pretrial hearing. The Green Book is a nationally publicized information booklet that compiles the general industry practices of thousands of construction companies in the United States and Canada.
According to the Green Book, the numbers (8), (40), and (176) have a distinct meaning within the construction industry. The Green Book states that “[i]t is the general practice in the industry to base rates upon one shift of 8 hours per day, 40 hours per week, or 176 hours per month of a 30-day consecutive period.”2 This explanation gives the numbers at the top of Exhibit “F” a definite meaning and supports Standard’s interpretation of the contract.
In addition, the Green Book establishes a general practice in the construction industry that companies normally charge for overtime use of equipment. Specifically, the Green Book provides as follows:
If the equipment is rented by the day, the rate for overtime is one-eighth of the daily rate for each hour in excess of eight. If it is rented by the week, the rate for overtime is 1/40 of the weekly rate for each hour in excess of 40. If it is rented by the month, the overtime rate is 1/176 of the monthly rate for each hour in excess of 176 hours in any one 30-day consecutive period.3
Chevron put on evidence that, during the three years before this contract, when Chevron and Standard operated under a similar contract, Standard had never charged Chevron for overtime use of equipment. Standard responded with evidence that the overtime use of equipment never came up until the flood of October 1994, which severely damaged Chevron’s plant and required rebuilding on an emergency basis under the contract at issue.
Extrinsic evidence may “be admissible to give the words of a contract a meaning consistent with that to which they are reasonably susceptible, i.e., to ‘interpret’ contractual terms.” Mescalero Energy, Inc. v. Underwriters Indem. Gen. Agency, Inc., 56 S.W.3d 313, 320 (Tex.App.-Houston [1st Dist.] 2001, pet. denied) (quoting Nat’l Union Fire Ins. Co. v. CBI Indus., Inc., 907 S.W.2d 517, 521 (Tex.1995)). “[A] special*630ized industry or trade term may require extrinsic evidence of the commonly understood meaning of the term within a particular industry.” Mescalero Energy, 56 S.W.3d at 320; see also Nat’l Union, 907 S.W.2d at 521 n. 6 (holding extrinsic evidence may be considered when interpreting meaning of terms used in particular “place, vocation, trade, or industry”). Courts may refer to extrinsic evidence such as industry dictionaries to determine the commonly understood meaning of an industry term. Mescalero Energy, 56 S.W.3d at 323. Many courts have used expert definitions to determine the meaning of specialized terms before deciding whether an instrument is ambiguous. Id.
In this case, the Green Book’s interpretation of the numbers (8), (40), and (176), as they were used in Exhibit “F,” supports Standard’s construction of the parties’ contract that would allow it to charge for overtime use of equipment. I would hold that the contract is therefore subject to two reasonable interpretations. Thus, the trial court erred in ruling, as a matter of law, that the contract unambiguously barred Standard’s claim for equipment overtime charges. This error probably caused the rendition of an improper judgment, and therefore is reversible error. See Tex.R.App. P. 44.1(a).
Accordingly, I would sustain Standard’s first issue and not reach the merits of the remaining issues.
Conclusion
I would reverse the judgment and remand the case to the trial court.

. The AED Green Book, Compilation of Nationally Averaged 1995 Rental Rates & Model Specifications for Construction Equipment (47th ed.1996) [hereinafter "Green Book”].

. Id. at 3.

. Id.