IN THE SUPREME COURT OF TEXAS
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NO. 08-0890
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THE HOUSTON EXPLORATION CO. AND
OFFSHORE SPECIALTY FABRICATORS, INC., PETITIONERS,
v.
WELLINGTON UNDERWRITING AGENCIES, LTD. ET AL., RESPONDENTS
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ON PETITION FOR REVIEW FROM THE
COURT OF APPEALS FOR THE FOURTEENTH DISTRICT OF TEXAS
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JUSTICE JOHNSON, concurring.
I join parts I and III of the Court’s opinion and its judgment. I write to explain my view of
why the stricken language of paragraph 13 can and should be considered for context.
First, the stricken language of paragraph 13 need not be considered in determining the
policy’s coverage. As explained in part III of the Court’s opinion and by the court of appeals, 267
S.W.3d 277, 283-87, the policy is unambiguous regardless of the presence of the stricken language.
The policy provides coverage for repairs and vessels engaged in “or about” repairs; it does not
provide coverage for vessels on standby for an extended period of time and not actively preparing
for, supporting, or engaged in repairs.
Next, this was not a one-size-fits-all insurance agreement. The insurance contract was
negotiated based on Offshore’s particular risks. The striking of paragraph 13 and other language
from the form policy is an objective reflection of the setting surrounding the creation of the policy;
it assists in giving context to how the policy terms were reached through negotiations. See ___
S.W.3d ___ at ___ (Jefferson, C.J., dissenting) (citing 11 RICHARD A. LORD, WILLISTON ON
CONTRACTS § 32.7 (4th ed. 1999)). The strikings show that the parties negotiating the contract were
experienced with the type of coverage being negotiated and that “standby charges” was a term of
art reflecting a particular, recognized category of risk. Moreover, the presence of the clause
providing a deductible for standby charges does not indicate that the policy covers standby charges
as the dissent posits. To the contrary, it indicates the opposite: standby charges were a separate,
recognized category of expense. The insuring portions of the policy did not provide coverage for
such charges even though the deductible clause was not stricken.
________________________________________
Phil Johnson
Justice
OPINION DELIVERED: August 26, 2011
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