Dallas/Fort Worth International Airport Board v. INET Airport Systems, Inc.

Case: 15-10390 Document: 00513461159 Page: 1 Date Filed: 04/12/2016

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT United States Court of Appeals

Fifth Circuit

FILED

Nos. 15-10390

April 12, 2016

Lyle W. Cayce

Clerk

DALLAS/FORT WORTH INTERNATIONAL AIRPORT BOARD,

Plaintiff - Appellant

v.

INET AIRPORT SYSTEMS, INCORPORATED; MICHAEL F. COLACO;

HARTFORD FIRE INSURANCE COMPANY, INET AIRPORT SYSTEMS,

L.L.C., As Successor in Interest to Inet Airport Systems, Incorporated,

Defendants - Appellees

----------------------------

CONSOLIDATED WITH 15-10600

THE DALLAS/FORT WORTH INTERNATIONAL AIRPORT BOARD,

Plaintiff - Appellant

v.

INET AIRPORT SYSTEMS, INCORPORATED; INET AIRPORT SYSTEMS,

L.L.C., As Successor in Interest to Inet Airport Systems, Incorporated,

Defendants - Appellees

Appeals from the United States District Court

for the Northern District of Texas

Case: 15-10390 Document: 00513461159 Page: 2 Date Filed: 04/12/2016

Nos. 15-10390, 15-10600

Before CLEMENT and HAYNES, Circuit Judges, and GARCIA

MARMOLEJO, District Judge.*

HAYNES, Circuit Judge:

The Dallas/Fort Worth International Airport Board (“DFW”) appeals the

final judgments of the district court against DFW in favor of INET Airport

Systems, Inc. (“INET”), 1 Michael F. Colaco, and Hartford Fire Insurance

Company (“Hartford”). The cross-motions for summary judgment and this

appeal relate to a contract between DFW and INET for construction at DFW

Airport. The parties accuse each other of breaching the contract following a

dispute regarding the proper configuration and installation of rooftop air

handling units for passenger boarding bridges in Terminal E of the DFW

Airport. In addition to INET, DFW sued Colaco individually as an officer and

director of INET, and Hartford as the bonding agency for INET on the contract

at issue. INET counterclaimed for breach of contract against DFW, claiming

entitlement to money DFW did not pay INET that INET alleged it was owed

under their agreement, as well as attorneys’ fees and legal expenses. INET

also counterclaimed for unjust enrichment and money had and received

against DFW.

The district court granted summary judgment against DFW on INET’s

affirmative defenses of excuse and prior material breach of the contract by

DFW and also dismissed claims against Colaco. The court dismissed DFW’s

claims against Hartford based on Hartford’s statute of limitations defense.

Finally, the district court denied in part DFW’s motion for summary judgment,

* District Judge of the Southern District of Texas, sitting by designation.

1 In its summary judgment opinion and after a bench trial to determine the damages

owed to INET, the district court found that INET Airport Systems, Inc., was succeeded by

INET Airport Systems, L.L.C., the successor in interest to INET. Michael Colaco dissolved

INET Inc. as its sole shareholder and director, selling its assets, including amounts receivable

under INET Inc.’s contract with DFW, to INET L.L.C. We refer to both entities as “INET.”

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Nos. 15-10390, 15-10600

which claimed that INET breached the contract, and granted DFW’s motion in

part as to INET’s counterclaims of unjust enrichment and money had and

received. DFW timely appealed these final judgments, and those appeals were

consolidated before us. 2

Because we find that material factual disputes remain unresolved, we

REVERSE the district court’s grant of summary judgment in favor of INET on

INET’s claims of excuse and prior material breach of the contract by DFW, and

REMAND for trial. We also REVERSE and REMAND the district court’s grant

of summary judgment for Hartford, as disputes of material fact remain over

whether DFW filed suit against Hartford within the statute of limitations.

Finally, we VACATE the district court’s subsequent final judgment awarding

damages to INET because it was based on the district court’s summary-

judgment determination that DFW should be liable to INET.

I. Jurisdiction and Standard of Review

We have jurisdiction over DFW’s appeals of the final orders of the district

court under 28 U.S.C. § 1291. We review a district court’s interpretation of a

contract de novo. See Interstate Contracting Corp. v. City of Dallas, 407 F.3d

708, 712 (5th Cir. 2005) (ICC). The contract in this case is governed by Texas

law, under which contract interpretation and whether a contract is ambiguous

are questions of law. Id. In interpreting a contract, courts must “ascertain

and give effect to the parties’ intentions as expressed in the writing itself,”

considering the entire writing and seeking to “harmonize and give effect to all

the provisions of the contract so that none will be rendered meaningless.” El

Paso Field Servs., L.P. v. MasTec N. Am., Inc., 389 S.W.3d 802, 805 (Tex. 2012)

2 The parties do not mention or challenge the district court’s dismissal of claims

against Colaco, nor its grant of DFW’s motion for summary judgment as to INET’s

counterclaims of unjust enrichment and money had and received. We do not address those

claims in this appeal. See Hughes v. Johnson, 191 F.3d 607, 613 (5th Cir. 1999).

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(citations omitted). We review de novo the district court’s decision on summary

judgment. Cooley v. Hous. Auth. of City of Slidell, 747 F.3d 295, 297 (5th Cir.

2014).

II. Background

A. Factual Background

DFW and INET entered into Contract No. 9500377 (the “Contract”) in

August 2009 for a project in Terminal E of DFW Airport, in which pre-

conditioned air and rooftop air handling units (“Rooftop Units”) were to provide

conditioned air (cooling and heating) to passenger boarding bridges and

aircrafts parked at terminal gates. INET won the Contract through a

competitive bidding process and agreed to follow the Contract’s terms, plans,

and specifications for the construction work. In submitting its bid proposal,

INET certified that its proposal constituted prima facie evidence that it had

examined “the site of the proposed work, the proposal, plans, specifications,

and contract forms,” and satisfied itself as to the materials furnished,

requirements of the Contract, plans, specifications, and site conditions.

The plans and specifications for the Contract included detailed drawings,

the precise Rooftop Units and parts to be used, approved manufacturers, and

performance requirements. Under the Contract and these plans, INET was

obligated to install operational Rooftop Units that were required to use “30%

ethylene glycol/water” supplied by DFW Airport’s piping system. INET also

agreed to provide schematic drawings of control sequence operations and the

required components for a fully operational control sequence that would

“provide auto defrost of the coils” within the Rooftop Units, through which the

ethylene glycol/water (“EG Water”) would cycle.

Campos Engineering (“Campos”) prepared the design for the project for

DFW, including the plans and specifications. INET was not allowed to

substitute products or designs for those agreed upon in the Contract documents

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without authorization from DFW. The Contract also contained provisions

requiring INET to alert DFW immediately to any “apparent error or omission

in the plans or specifications” so that DFW could make a final decision about

how to proceed. If the completion of the Contract required extra work for which

payment had not been delineated, the Contract provided that this extra work

should be covered by “a written change order” issued by DFW with “agreed

prices for performing the change order work.” DFW was to reject any claim for

payment not covered by written change order or supplemental agreement.

Trouble arose when INET expressed concern to DFW that the Rooftop

Units specified in the plans and selected by INET in the Contract might not

function correctly with the EG Water mixture. INET informed DFW of this

potential problem during the construction kick-off meeting on October 14,

2009—specifically, that the EG Water supplied by DFW’s pipes would be at

sub-freezing temperatures, causing ice to build up on the outer surface of the

Rooftop Unit coils and keeping the coils from performing as required. After

receiving no immediate response to this concern, INET submitted a “Request

for Information,” or “RFI,” asking how it should proceed (hereinafter, “RFI-2”).

DFW, Campos, and INET corresponded about this issue through

extensive discussions that resulted in two proposals for how to add control

sequences (“Control Sequence Proposal”) or revised piping (“Revised Piping

Proposal”) to the Rooftop Units to prevent potential defects. The record does

not indicate that the parties ever reached any agreement on whether to adopt

these proposals or how to proceed. Eventually, DFW notified INET that INET

had failed to meet the substantial completion deadline and that DFW would

begin assessing liquidated damages. DFW declined to pay at least one invoice

submitted by INET after this date, and in April 2012, DFW made a claim

against Hartford on the performance bond. DFW, INET, and Hartford

corresponded throughout 2012. DFW had the remaining work on the Rooftop

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Units completed by a substitute contractor by contract dated July 9, 2013.

In June 2012, DFW took official action related to the Contract with

INET. The parties dispute whether this action terminated the Contract and if

not, when the Contract was terminated or abandoned. Timing is relevant

because DFW filed suit on August 5, 2013, and the district court dismissed

DFW’s claims against Hartford as barred by Texas’s one-year statute of

limitations for suits on performance bonds. See TEX. GOV’T CODE § 2253.078.

B. Procedural History

In response to the parties’ various motions, the district court granted

DFW’s motion for summary judgment in part, holding INET could not prevail

on its counterclaims for unjust enrichment and money had and received. The

district court determined the case turned on which party first breached the

Contract and concluded the Contract placed the risk of defects in the designs

and specifications on DFW under Texas law, that DFW had admitted the

designs and specifications were defective, and that DFW therefore breached

the Contract by failing to acknowledge the defects and issue appropriate

change orders. The district court granted in part INET’s motion for summary

judgment, on its affirmative defenses of excuse and prior material breach of

the Contract by DFW, 3 dismissed DFW’s claims against Hartford, Colaco, and

INET from the case, and after a bench trial on damages and attorneys’ fees,

issued a final judgment awarding INET $1,293,728.74 in damages and fees,

plus interest.

III. Discussion

The dispute between the parties turns on where the Contract allocated

3 Although the district court noted that INET did not seek judgment on its

counterclaim for breach of contract, the district court observed that “DFW does not dispute

that it is withholding monies on work that was completed by INET” and urged the parties to

“agree on the amounts withheld.” After a bench trial, the district court apparently awarded

INET that agreed amount, plus attorneys’ fees and costs.

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Nos. 15-10390, 15-10600

the risk of defective plans and specifications, whether the plans and

specifications were in fact defective, and what was required of each party once

INET claimed it found a defect that would prevent its performance. We

conclude it was error to grant summary judgment for INET on the basis that

DFW first breached the Contract. The record contains disputes of material fact

regarding which party prevented performance by failing to fully cooperate in

arriving at a solution once the parties discovered defects.

A. Defective Plans and Specifications and the Contract’s Allocation of Risk

The district court correctly concluded there was no dispute of material

fact regarding whether the plans and specifications were defective and had to

be changed for the Rooftop Units to function properly. We therefore must

determine how the Contract allocated the risk of defective plans and

specifications. The district court concluded that the Contract allocated this

risk to DFW and that DFW breached the Contract by insufficiently cooperating

with INET to resolve problems created by the defective plans and

specifications. We conclude that while DFW partly bore the risk of defective

plans and specifications under this Contract, the language of the Contract

requires both parties to participate in resolving such defects.

Texas law allows contracting parties to allocate the risk of defective

designs, plans, and specifications to an owner (in this case, DFW), rather than

the contractor (INET), but this “require[s] contractual language indicating an

intent to shift the burden of risk to the owner.” ICC, 407 F.3d at 720; see also

Millgard Corp. v. McKee/Mays, 49 F.3d 1070, 1071–73 (5th Cir. 1995). The

language of this Contract allocates the risk of defects at least partially to DFW,

in that it requires DFW to cooperate through a change order or other actions

in the event that INET brings a discrepancy to DFW’s attention. For example,

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Nos. 15-10390, 15-10600

Special Provision 4 6.0(D), under the title “Warranty of Construction,” provides:

Unless a defect is caused by the negligence of the Contractor

or subcontractor or supplier at any tier, the Contractor shall not

be liable for the repair of any defects of Owner furnished material

or design furnished by the OWNER or for the repair of any damage

that results from any defect in material or designs furnished by

the OWNER.

Special Provision 31.0 states:

In case of conflict, discrepancies, errors or omissions among

the various Contract documents, the matter shall be submitted

immediately by Contractor to the Construction Manager for

decision, and such decision shall be final. Any Work affected by

such conflicts, discrepancies, errors or omissions which is

performed prior to the Construction Manager[’s] determination

shall be performed at the Contractor’s risk.

These provisions seem to allocate the risk of defects to DFW. Yet, the

Contract allocated some duties to INET as well, duties that required INET to

cooperate or take other actions in this case to help resolve the discrepancy

between the Contract’s requirements and the designs and specifications.

Various General Provisions support INET’s duties to: (1) inspect the plans and

specifications and bring up discrepancies during the bidding process; 5 (2)

otherwise assume full responsibility for the compatibility of equipment and

parts; 6 and (3) fill in details necessary to complete the work as specified,

4 The Contract provides that its provisions are intended to be complimentary, but in

case of a discrepancy, Special Provisions govern over General Provisions. We thus begin with

the Special Provisions of the Contract.

5 General Provision 20-6 of the Contract clearly places a duty on INET to make a pre-

bid inspection and to satisfy itself about the requirements of the plans and specifications

relative to the Contract’s requirements.

6 INET was to provide air handling units “complete with ethylene glycol/water

cooling/heating coils” and “related controls,” including providing “detailed schematic

drawings showing all components and their arrangement and their relation to the control

system,” and a “sequence of operation description of each control system.”

8

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including “[n]ecessary controls to provide auto defrost of the coils.” 7 INET

assumed “sole responsibility” for compliance with the Contract documents, and

“full responsibility for satisfactory operation of all component parts of the

mechanical systems to assure compatibility of all equipment and performance

of the integrated systems in accordance with the requirements of the

specifications.” Furthermore, INET had to strictly conform its performance to

the designs, plans, and specifications of the Contract. 8 Yet, the Contract

allowed INET to submit potential errors or discrepancies to DFW and obtain

approval for a change in the design. 9

Crucially, if the engineer or DFW determine changes are necessary after

INET points out a potential error, the Contract provides for the parties to agree

upon how to adjust for the change. DFW can make alterations to the work

under General Provision 40-2, but such alterations “shall be covered by

‘Change Orders’ issued by [DFW],” and must be in writing where the orders

would change the Contract’s price. The Contract defines a change order as “[a]

written order to [INET] covering changes in the plans, specifications or

proposal quantities and establishing the basis of payment and contract time

adjustment, if any, for the work affected by such changes.” The Contract

7 INET was to provide “all other required components to accomplish the specific

control sequence specified” in the Contract and “all other required components for a complete

operating system.”

8 These duties were specified in General Provision 60-7, requiring strict conformance

with “the contract, plans, or specifications” for all materials, or else they “shall be rejected,”

and in General Provision 90-7, entitled “PAYMENT WITHHELD,” stating that “[DFW] may

withhold all or part of any payment otherwise due [to INET]” for “failure to execute the work

in strict accordance with the Contract Documents.”

9 The Contract also provides that the engineer has authority to “decide any and all

questions which may arise as to the quality and acceptability of materials furnished, work

performed, and as to the manner of performance,” and “shall decide all questions which may

arise as to the interpretation of the specifications or plans relating to the work, [and] the

fulfillment of the contract on the part of [INET].” The “engineer” referred to by the Contract

is apparently Campos, DFW’s engineering firm; Bill Kumpf was the “engineer of record.”

9

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Nos. 15-10390, 15-10600

elsewhere notes that if changes affect the contract price, they may be made

“only by written Contract Change Order, approved and executed by both

[DFW] and [INET].” Therefore, any change order to adjust for the defects

discovered by INET required the assent of both parties. 10

In sum, the Contract in this case contains a mixture of provisions that

place the risk of defects on both DFW and INET. INET agreed that it would

provide a control sequence and other mechanisms to ensure defrosting of the

coils within the Rooftop Units; that it had inspected the plans and

specifications and would point out potential problems before bidding; that all

equipment would be compatible with DFW’s system; and that it would fill in

details as necessary. INET discovered a defect in the plans and specifications,

which contained very detailed requirements that INET was not free to

disregard or redesign without DFW’s approval. Therefore, DFW also agreed to

provide change orders if INET pointed out defects in the plans, and the

Contract allows DFW and INET to resolve any such defects discovered after

the Contract’s execution by mutual agreement. The district court correctly

concluded DFW had a duty to cooperate with INET and issue a change order if

necessary to correct defects. However, INET’s agreement was also required for

such a process under the Contract, and INET had duties that required it to

cooperate in finding a solution to any defects. We therefore address whether

there are disputes of material fact in the record regarding which party

breached the Contract by failing to cooperate and find a solution to the defect.

10 Other courts have described change orders as agreements requiring mutual assent.

See, e.g., Roberts, Taylor & Sensabaugh, Inc. v. Lexington Ins. Co., No. H-06-2197, 2007 WL

2592748, at *8 (S.D. Tex. Sept. 5, 2007); cf. Hathaway v. General Mills, Inc., 711 S.W.2d 227,

228–29 (Tex. 1986) (“Parties have the power to modify their contracts. A modification must

satisfy the elements of a contract: a meeting of the minds supported by consideration.”). The

language of this Contract and underlying legal principles make clear that INET’s assent was

required before the plans and specifications could be revised in this case. We reject INET’s

argument that DFW had the power and obligation to order such revisions unilaterally.

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B. Breach of the Contract

Texas law excuses a party’s performance under a contract when the other

party’s breach prevents its performance. See, e.g., Transverse, L.L.C. v. Iowa

Wireless Servs., L.L.C., 617 F. App’x 272, 277 (5th Cir. 2015); 11 L. H. Land

Painting Co. v. S & P Constr., Inc., 516 S.W.2d 14, 16 (Tex. Civ. App.—Fort

Worth 1974, writ dism’d). 12 Texas courts have held that an owner may not

ignore defects recognized by a contractor, but must cooperate to modify the

contract when necessary. Cf. N. Harris Cty. Junior Coll. Dist. v. Fleetwood

Constr. Co., 604 S.W.2d 247, 254 (Tex. Civ. App.—Houston [14th Dist.] 1980,

writ ref’d n.r.e.) (finding an owner breached the contract by refusing to alter

specifications related to a concealed condition the contractor pointed out);

Emerald Forest Util. Dist. v. Simonsen Constr. Co., 679 S.W.2d 51, 54 (Tex.

App.—Houston [14th Dist.] 1984, writ ref’d n.r.e.) (“If appellee had notified

both the engineer and the owner in writing of the wet sand conditions, it would

have been relieved of liability.” (emphasis omitted)). From this authority, the

district court concluded there were no disputes of material fact regarding

whether DFW first breached the Contract by failing to agree to a solution to

the defective plans and specifications. We disagree.

The parties discussed two possible modifications of the plans and

specifications that might have addressed the defects INET discovered, known

11 Although Transverse is not “controlling precedent,” it “may be [cited as] persuasive

authority.” Ballard v. Burton, 444 F.3d 391, 401 n.7 (5th Cir. 2006) (citing 5TH CIR. R. 47.5.4).

12 See also Nitram, Inc. v. Cretan Life, 599 F.2d 1359, 1371 (5th Cir. 1979) (“It is a

general principle of contract law that if one party to a contract prevents or makes impossible

performance by the other party, the latter’s failure to perform will be excused and the

offending party will not be permitted to recover damages for nonperformance. But this

principle has no application when the party whose performance was prevented entered into

the contract fully aware of the obstacles which would prevent his performance.” (citations

omitted)); Owens v. William H. Banks Warehouses, Inc., 202 F.2d 689, 692 (5th Cir. 1953)

(same).

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as the Control Sequence Proposal and the Revised Piping Proposal. The record

is clear that INET did not agree to the Control Sequence Proposal, as INET

admits in its brief. 13 In March 2010, Campos sent DFW another possibility,

the Revised Piping Proposal, which DFW forwarded to INET that same month.

A dispute of material fact remains regarding whether INET rejected the

Revised Piping Proposal outright or hindered the process of agreeing to this or

another solution. INET sent DFW requests for information related to the

Revised Piping Proposal in April 2010, requesting details and formal

documentation from DFW so that INET could “price this change.” DFW

responded with information about some of the technical details of the Revised

Piping Proposal, but the record does not show that DFW or INET ever formally

priced this change or modified their Contract to incorporate the Revised Piping

Proposal. Based on its requests for information, INET argues DFW breached

the Contract by failing to cooperate in issuing a change order and incorporating

the Revised Piping Proposal into the Contract.

However, DFW argues INET rejected the Revised Piping Proposal,

pointing to correspondence between INET and DFW. 14 For example, in April

13 INET states that it “informed DFW that the changes to the control sequence,

without more, would not be sufficient to ensure that the units would perform as required

without freezing.”

14 INET objects to much or all of this evidence as self-serving and not

contemporaneous. Cf. Anco Insulations, Inc. v. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa.,

787 F.3d 276, 281–82 (5th Cir. 2015). We find these objections meritless. Evidence proffered

by one side to support or defeat a motion for summary judgment will inevitably appear “self-

serving.” Nevertheless, we have accepted testimony like what is in the record in this case as

giving rise to inferences that create disputes of material fact when properly construed for the

nonmoving party. See, e.g., In re Yarn Processing Patent Validity Litig., 498 F.2d 271, 287

(5th Cir. 1974); see also C.R. Pittman Constr. Co. v. Nat’l Fire Ins. Co. of Hartford, 453 F.

App’x 439, 443–44 (5th Cir. 2011) (holding summary judgment was improper because,

although “self-serving,” affidavits were not wholly conclusory and were based on personal

knowledge). We do so here. We also reject INET’s argument that Campos instructed INET

to proceed with the two different proposals at issue, placing INET in a difficult situation

without a formal change order. The record evidence does not suggest beyond dispute that

Campos or DFW gave INET a unilateral and binding instruction to incorporate either of the

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2010, INET sent a letter to DFW requesting approval to spend over $60,000 to

fix the defect by installing alternate units. In June 2010, INET sent another

letter to DFW indicating that “[a]s a result of the ongoing discussions”

regarding the units, INET proposed alternative side-mounted units at an

additional cost of just over $20,000. DFW also highlights deposition testimony

by a DFW employee that INET “never agreed” to the Revised Piping Proposal.

This non-conclusory evidence creates a dispute of material fact on this issue.

Significant evidence in the record suggests that the parties attempted to

agree about how to address INET’s concerns, and that INET and DFW both

took strong positions about the necessary solution. In these circumstances the

Contract required both parties to participate in resolving defects. Any

contractual modification or change order required the mutual assent of the

parties, and questions of mutual assent are fact based. Sifting through the

evidence to determine whether the parties reached agreement on a contractual

modification is a task ill-suited for summary judgment on this record. For

these reasons, and because disputes of material fact remain regarding whether

DFW or INET breached the Contract by preventing an agreement about how

to address defects in the Contract’s plans and specifications, we reverse the

district court’s grant of summary judgment for INET.

C. Hartford’s Statute of Limitations Defense

The district court dismissed DFW’s claim against Hartford based on

Hartford’s affirmative defense that the claim was barred by the statute of

limitations. DFW filed suit against Hartford and INET on August 5, 2013. In

Texas, “[a] suit on a performance bond may not be brought after the first

anniversary of the date of final completion, abandonment, or termination of

the public work contract.” TEX. GOV’T CODE § 2253.078. The statute of

proposals.

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limitations would bar DFW’s suit if the Contract was terminated or abandoned

before August 5, 2012. The district court construed a resolution by the DFW

Board as a trigger date for limitations and alternatively found the Contract

abandoned “years” before DFW filed suit. We disagree and reverse the district

court’s grant of summary judgment for Hartford on this claim.

1. Termination of the Contract

It is undisputed that on June 7, 2012, the Board passed the following

resolution (“Resolution”):

BE IT RESOLVED BY THE [DFW] BOARD

That the Chief Executive or designee be authorized to

terminate Contract No. 950377 . . . and to pursue any other relief

to which the Board may be entitled.

On the same document containing the resolution, the “Description” section

stated: “This action will terminate Contract No. 9500377 [with INET].” The

Action section of the document repeated the language of the Resolution itself

just above the bullet-point “Description.” Under “Justification,” the document

says “Board staff recommends the termination of this contract and seeks

authorization to pursue any relief to which the Board may be entitled by reason

of the contractor’s default.”

We conclude the Resolution was not self-executing and that it is not

beyond dispute that the Contract was terminated or abandoned before August

2012, as Hartford was required to prove to succeed in a motion for summary

judgment on its affirmative defense. See generally Int’l Shortstop, Inc. v.

Rally’s, Inc., 939 F.2d 1257, 1264–65 (5th Cir. 1991) (noting that where the

moving party would bear the burden of proof at trial for an affirmative defense,

the party must produce evidence that “would entitle it to a directed verdict if

the evidence went uncontroverted at trial” (citation omitted)). We construe the

DFW Board’s Resolution like any other statute, as it is the equivalent of a

municipal ordinance. See generally Bd. of Adjustment of City of San Antonio

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v. Wende, 92 S.W.3d 424, 430 (Tex. 2002) (“Courts use the same rules that are

used to construe statutes to construe municipal ordinances.”); TEX. TRANSP.

CODE § 22.074(b)–(c) (providing that a joint airport board operates with “all the

powers” of each constituent agency, including respective cities). The language

of the Resolution is unambiguous and provides only that the Board gave the

CEO authority to terminate the Contract. See Alex Sheshunoff Mgmt. Servs.,

L.P. v. Johnson, 209 S.W.3d 644, 651–52 (Tex. 2006) (noting that the enacted

language is what constitutes the law and that the inquiry asks whether that

language is unambiguous). We therefore reverse the district court’s conclusion

that the Resolution and extraneous evidence showed DFW terminated the

Contract through the June 7, 2012, Board Resolution or before August 2012. 15

2. Abandonment of the Contract

The district court concluded in the alternative that INET abandoned the

contract long before August 2012, noting in summary fashion that DFW

alleged that after October 2010, INET would do no further work on the

Contract. As with termination, Hartford has the burden to show the parties

abandoned the Contract before August 2012. See Int’l Shortstop, 939 F.2d at

1264–65. “‘Abandonment’ is principally a matter of intention which must be

established by clear and satisfactory evidence,” and if relying on conduct, “the

acts relied upon must be positive, unequivocal and inconsistent with the

existence of the contract.” Capitol Steel & Iron Co. v. Standard Accident Ins.

15 Even apart from the Resolution, we conclude that disputes of material fact remain

regarding whether the Contract was terminated before August 2012. Contrary to the

requirements for assessing a summary judgment motion, the district court construed

inferences in Hartford’s favor in relying on vague, contemporaneous statements by DFW

employees to conclude that the DFW Board intended to terminate the Contract before August

2012. These statements are insubstantial evidence, if any, of that proposition, and there is

evidence to the opposite effect in the record. See generally Int’l Shortstop, 939 F.2d at 1265

(noting that when intent is at issue, summary judgment is disfavored because the issue of

intent often involves credibility determinations).

15

Case: 15-10390 Document: 00513461159 Page: 16 Date Filed: 04/12/2016

Nos. 15-10390, 15-10600

Co., 299 S.W.2d 738, 740–41 (Tex. App.—Amarillo 1952, no writ) (citations

omitted). We discern no such positive, unequivocal conduct that is inconsistent

with the existence of a continuing Contract between INET and DFW. Rather,

record evidence creates a fact issue about whether either party intended to

terminate or abandon the Contract before August 2012. Accordingly, we

reverse the district court’s grant of summary judgment for Hartford and

remand for further proceedings.

IV. Conclusion

Because disputes of material fact remain, we REVERSE the grants of

summary judgment for INET and Hartford and REMAND this case for the

claims to proceed to a fact finder. 16 Since the district court granted INET

damages and fees based on its summary judgment rulings, we also VACATE

the district court’s June 16, 2015, judgment making those awards.

16We do not reach several other claims the parties mention on appeal that the district

court found moot or did not address, including how to resolve INET’s affirmative defenses

and whether INET violated the Contract through its dissolution and the assignment of the

Contract to its successor. The district court may reach these issues as necessary on remand.

We also decline to grant summary judgment for DFW, as it requests, for the same reason

that we reverse the grant of summary judgment for INET: namely, disputes of material fact

remain regarding the timing and details of which party breached the Contract in this case.

16