• Supreme Court of Texas
  • 15-0502
Conoco and Alma swapped oil and gas interests under an Exchange Agreement in which each accepted responsibility and indemnified the other for any environmental claims related to the properties it received. Alma later filed for bankruptcy protection. After a court-approved auction, Noble entered into a purchase agreement in which it agreed to buy the properties Alma had received from Conoco under the Exchange Agreement. Noble thereafter acted as if it had assumed the Exchange Agreement, including agreeing to indemnify Conoco for two environmental contamination suits. In 2010, however, Noble refused to indemnify Conoco for another suit. The trial court entered summary judgment for Noble, but the court of appeals reversed. On appeal, the court held that the Exchange Agreement was an executory contract under the bankruptcy code; that, from its review of the purchase agreement, the Exchange Agreement was among the interests Noble purchased; and that the indemnification portion of the Exchange Agreement was assumed by Noble under its purchase agreement. The court noted that, while the bankruptcy plan allowed Noble to reject executory contracts by a certain date, Noble never did so and that Noble's post-closing conduct (agreeing to indemnify Conoco for two environmental contamination suits) buttressed the conclusion that Noble assumed the indemnification obligation. It affirmed the court of appeals' judgment. Noble Energy, Inc. v. ConocoPhillips Company, Supreme Court, No. 15-0502, 6/23/17

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