PENN VIRGINIA OIL & GAS GP, LLC AND PENN VIRGINIA OIL & GAS LP, Appellants
ALFREDO DE LA GARZA, INDIVIDUALLY AND AS NEXT FRIEND FOR I. D. L. G. AND K. D. L. G., MINORS, AND JOHN PAUL ADAME, INDIVIDUALLY AND AS NEXT FRIEND FOR C. A. A., J. P. A., JR., AND J. N. A., MINORS, Appellees
Appeal from the 215th District Court Harris County, Texas
Trial Court Case No. 2014-42519
consists of Chief Justice Radack and Justices Brown and
accelerated interlocutory appeal,  Penn Virginia Oil & Gas
GP, LLC ("Penn GP") and Penn Virginia Oil & Gas
LP ("Penn LP") (collectively, "Penn
Virginia") appeal from the trial court's order
denying their motion to compel arbitration of personal injury
claims asserted by Alfredo De La Garza.
Garza was injured while working for his employer, Nabors
Completion & Production Services Company ("Nabors
Completion") on a wellsite operated by Penn Virginia. De
La Garza sued Penn Virginia in state district court, and Penn
Virginia moved to arbitrate under the Nabors Dispute
Resolution Program, an arbitration agreement that requires
arbitration of disputes between Nabors employees and
Virginia argued that De La Garza's claims were arbitrable
because Penn Virginia had become an Electing Entity by
entering into drilling contracts with Nabors Drilling USA, LP
("Nabors Drilling") in 2008 and 2010. De La Garza
responded that Penn Virginia had only become an Electing
Entity for disputes related to work performed under those
specific contracts and that he was injured while working at a
wellsite governed by a different contract, one that
superseded the prior contracts and did not contain an
Electing Entity provision. The trial court agreed with De La
Garza and denied the motion. We affirm.
Nabors Dispute Resolution Program
Industries, Inc. ("Nabors") is a drilling
contractor. Nabors has a Dispute Resolution Program that
requires arbitration of "all Disputes" between the
"Company" and the Company's "present and
former" employees. Under the program, a
"Dispute" is defined to include "all legal and
equitable claims, " including claims for "any
personal injury allegedly incurred in or about a Company
workplace or in the course and scope of an Employee's
employment." The "Company" is defined to
include Nabors, Nabors's subsidiaries, and any
"Electing Entity." An "Electing Entity, "
in turn, is defined as "any legal entity that has agreed
to be bound by the Program . . . ."
2008 and 2010 contracts between Penn Virginia and Nabors
Virginia Corporation is an oil and gas company. Over the
years, Penn Virginia Corporation and its subsidiaries have
contracted with various Nabors subsidiaries to drill and
service onshore wells throughout the United States. Penn
Virginia Corporation and its subsidiaries have become
Electing Entities under at least two contracts with Nabors.
first contract was executed in 2008 between Penn LP and
Nabors Drilling. It governs drilling operations for a
wellsite in Jefferson County, Texas. The 2008 contract was filled
out on a form contract. It contains a duration clause, which
provides that the contract will "remain in full force
and effect until drilling operations are completed on the
well . . . ." And it contains a merger clause, which
provides that the contract "constitutes the full
understanding of the parties" and will "exclusively
control and govern all work performed" thereunder.
2008 contract also includes several exhibits, one of which
lists 17 "special provisions" that are expressly
"made a part" of the contract. Included among the
"special provisions" is an Electing Entity
provision. The Electing Entity provision states, in relevant
Operator [Penn LP], its parent, subsidiary and affiliated
corporations, as well as the employees, officers and
directors of each (collectively, "Operator") is
cognizant of the Nabors Dispute Resolution Program and wishes
to become an Electing Entity, as defined in that Program.
Accordingly, Operator and Nabors Industries, Inc.
("Nabors") hereby agree that Operator is an
Electing Entity as to all disputes between Operator and the
present and former Employees and Applicants of Nabors
pursuant to the Nabors Dispute Resolution Program as it
currently exists and as may be amended from time to time. . .
. Operator may withdraw this election to participate in the
Program at any time by giving notice of such withdrawal to
Nabors, such revocation to be effective with respect to any
claims not yet instituted as of the date of revocation.
Operator understands that it is bound by the terms of the
Program with respect to all Disputes with Nabors employees,
regardless of whether such Dispute is initiated by the
employee or by Operator.
2008 contract is signed by representatives of Penn LP and
Nabors Drilling; the exhibit listing the 17 "special
provisions" is not.
second contract was executed in 2010 by Nabors Drilling and a
different Penn entity, Penn Virginia MC Energy, LLC
("Penn MC"). It governs drilling operations for a
wellsite in Logan County, Oklahoma. The 2010 contract was filled
out on the same form as the 2008 contract. It has the same
title, the same duration and merger clauses, and the same
Electing Entity provision. Like the 2008 contract, the 2010
contract's Electing Entity provision is listed on an
attached exhibit that is expressly "made a part" of
the contract. And like the 2008 contract, the 2010 contract
is signed by representatives of both contracting parties,
while the exhibit listing the "special provisions"
2013 contract between Penn Virginia and Nabors
Virginia entity is an Electing Entity under the most recent
contract with Nabors, a contract executed in March 2013 with
Nabors Completion. The 2013 contract is not limited to a
specific wellsite. Instead, it governs all operations
conducted by Penn LP in Texas. The 2013 contract states that it
"shall become effective" the day of its execution
and that it "shall supersede all prior service contracts
between the parties . . . with respect to new ...