Friday, October 23, 2009

Court reviews claim of fraud and misrepresentation in a case about drilling for oil on personal property

BETTY L. DAVIS v. A. V. CONNER AND TIMOTHY BRYAN CONNER (Tenn. Ct. App. October 23, 2009)

This case involves a claim of promissory fraud. The plaintiff is an elderly widow who lives on a farm. The defendant is in the oil business. The defendant approached the widow about drilling for oil on her farm. He told the plaintiff that if she invested in the oil wells, he would match her investment equally and manage the oil wells on her property. He proposed that they share in any profits 65% to the plaintiff widow, and 35% to the defendant. The widow agreed. Over several years, the widow invested over $100,000 in five oil wells. Some of the wells produced oil, and the resulting profit was shared 65%/35%. The widow later discovered that the defendant had not, in fact, invested any of his own money in the oil wells, and that he was mismanaging them.

The widow then filed this lawsuit against the defendant for misrepresentation, fraudulent inducement, and mismanagement of the oil wells. After a bench trial, the trial court awarded the widow compensatory damages and punitive damages. It also divested the defendant of any future interest in the oil wells on the widow's property. The defendant now appeals. We affirm the trial court's decision in all respects.

Opinion may be found at: