Appellate court denies Vopak Terminal Deer Park motion for rehearing in contract breach case

By Dee Thompson | Oct 5, 2017

HOUSTON – The Texas 14th Court of Appeals has denied a motion for rehearing in a contract case between an ethanol trade and distributor and a bulk tank storage service.

HOUSTON – The Texas 14th Court of Appeals has denied a motion for rehearing in a contract case between an ethanol trade and distributor and a bulk tank storage service.

The court denied Vopak Terminal Deer Park Inc.'s motion for rehearing on Sept. 21. Vopak had challenged Vertical North America Inc., now known as Raizen North America Inc., on the ownership of the claims.

“We do not decide who 'owns' the claims against Vopak; we hold merely that Vertical NA retains sufficient justiciable interest in the claims so as to confer standing and defeat Vopak's motion to dismiss. We withdraw our previous opinion, vacate our previous judgment, and issue this substitute opinion and judgment. We deny Vopak’s motion for rehearing and deny as moot Vopak’s motion for en banc consideration,” the court's opinion stated.

Vertical North America Inc. filed suit against Vopak Terminal Deer Park Inc. in 2012. Vertical is an ethanol trader and distributor based in Houston. Vopak is a company providing bulk storage tanks. Vertical and Vopak entered into a series of contracts in 2011. Vertical NA was a corporate subsidiary of Vertical UK LLP when it signed the agreements.

An opinion was issued by the court on May 23 but Vopak filed a motion for rehearing and for en banc consideration. Vertical filed a response.

“On Aug. 25, 2011, Vertical UK entered into a Purchase and Sale Agreement, selling all shares of Vertical NA to Raizen Trading LLP. Vertical NA filed suit against Vopak in June 2012 for breach of contract and fraud. In July 2015, Vopak moved to dismiss the suit on the basis Vertical NA lacked standing 'because it does not own the claims it is asserting.' The trial court granted Vopak's motion and dismissed the suit for want of jurisdiction,” the opinion states.

In order to bring a lawsuit, a plaintiff must have both standing and capacity, the opinion stated. Standing means there is some personal legal interest. Capacity means the person or entity can enter into contracts.

Vopak claims that Vertical lacked standing because after the Purchase and Sale Agreement, Vertical UK owned the claims. Vertical NA maintained that the issue was actually capacity.

“In its brief, Vertical NA notes that if the issue were treated as a question of capacity, rather than standing, the trial court's judgment must be vacated because Vopak did not file a verified answer challenging Vertical NA's capacity to bring this suit,” according to the court's opinion.

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