E. Broadtop Connecting R.R., Inc. v. Andarko Petroleum Corp.

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

Appeal from the Order Entered July 21, 2020 In the Court of Common Pleas of Centre County Civil Division at No: 2017-3105

BEFORE: STABILE, J., KUNSELMAN, J., and STEVENS, P.J.E.^[*]

MEMORANDUM

STABILE, J.

Appellant, East Broadtop Connecting Railroad, Inc., appeals from the trial court's July 21, 2020 order entering summary judgment in favor of Appellee, Andarko Petroleum Corporation ("Andarko"). We affirm.

The trial court found the following facts:

This matter originates from [Andarko's] decision in 2015 to establish a rail project in Pennsylvania in order to ship wastewater used in hydraulic fracturing ("fracking") to treatment facilities in Ohio, and subsequently return the water for reuse via the same method Sam Mannino Enterprises ("SME") owned approximately thirty (30) tanker rail cars and sought to lease these tankers to [Andarko]. SME's contact with [Andarko] was Chad Bruinooge, and the two parties conducted preliminary negotiations over email and phone beginning in spring of 2015. In the first correspondence between SME and Bruinooge in April, 2015, Bruinooge explained to SME that rail leases are 'very difficult to

sell to upper management' and that [Andarko] 'may not make a deal.' In a September 3, 2015, email, Bruinooge writes '… let's discuss the possibility of reaching a potential deal ... we are very close to presenting this option to upper management ….' In an email to SME dated October 5^th, 2015, Bruinooge states 'I have received the go ahead to move forward setting up our rail program …' and that Bruinooge needed a formal proposal from SME. SME responded by stating it would provide a proposal as soon as possible, and offered to let Bruinooge inspect the rail cars. SME sent an abbreviated term sheet to Bruinooge, which SME later conceded in this litigation did not contain detail sufficient to make it a formal lease. SME corresponded with Andarko's local representative, Abbie Allison, who instructed SME that it needed to execute a Master Services Agreement ("MSA"), as all entities doing business with Andarko were required to do, before proceeding with the lease agreement. On October 19^th, 2015, SME had an email exchange with Ms. Allison about the prospect of becoming an approved vendor in Andarko's system, and that SME knew becoming an approved vendor was an issue separate and apart from the lease agreement

On October 20^th, 2015, Bruinooge traveled to Altoona to inspect the rail cars with Sam Mannino and Larry Salone ("Salone"), [Appellant's] principal, during which Bruinooge allegedly stated to Salone that he would take the rail cars. [Appellant] operates a 'switching railroad' in Mt. Union, Pennsylvania. Salone testified at his deposition that he was not partners with Sam Mannino, and that he did not know any details regarding the potential deal between SME and [Andarko] prior to being contacted by Sam Mannino to meet at the Rose Yard in Altoona so [Andarko] could inspect SME's rail cars. During the inspection, Salone allegedly asked Bruinooge what they were doing and how things were going, and Bruinooge allegedly replied 'I'll take them.' Salone allegedly replied 'so I am assuming they are coming to me then,' and Bruinooge allegedly replied 'yep.' No conversations about when Bruinooge would take the rail cars took place, nor did he state when the cars would be transported to [Appellant]. Salone stated in his deposition testimony that he was responsible for having the rail cars shipped to Mt. Union, and that neither SME, Bruinooge, nor [Andarko] ever requested that the rail cars be moved.

On January 14, 2016, Bruinooge responded to an email from SME stating that corporate management was uncomfortable with

the negotiation positions taken by SME, and that the commercial team would further evaluate SME before executing any lease contract. On March 8^th, 2016, Bruinooge informed SME in an email that [Andarko] would not be engaging in business with SME at the present time, effectively ending all negotiations.

On January 28^th, 2016, [Appellant] told Bruinooge that the rail cars had been moved to the outbound track, despite not being instructed to do so by either Bruinooge or [Andarko]. On March 8^th, 2016, [Appellant] received an email from Bruinooge informing [Appellant] that negotiations with SME had broken down and that no lease would be forthcoming. The next contact between [Appellant] and [Andarko] occurred on March 25^th, 2016, when [Appellant] submitted an invoice to [Andarko] for $60, 030.00 as payment to [Appellant] for the tariff rates related to moving and storing the rail cars, which [Andarko] declined to pay, and the present suit followed.

Trial Court Opinion, 7/17/20, at 2-4 (record citations omitted).

Appellant commenced this action in Clearfield County on July 18, 2016. On April 4, 2017, Andarko moved to change venue to Centre County. The Clearfield County trial court granted the motion on August 15, 2017. On November 13, 2017, Andarko moved to consolidate this action with Centre County docket number 4245 of 2016 (the appeal from which we dispose of in a companion memorandum at 1123 MDA 2020). The trial court granted that motion on November 15, 2017. The parties proceeded through discovery, and Andarko moved for summary judgment on February 14, 2020. The trial court granted the motion on July 17, 2020. This timely appeal followed.

Appellant raises three issues:

I. Did the trial court err in finding that there was no issue of material fact as to whether Chad Bruinooge had authority to bind or obligate [Andarko] or whether [Appellant] acted

reasonably upon relying upon Chad Bruinooge's authority to obligate or bind [Andarko] to a contract with [Appellant]?

II. Did the