Morgan v. Green-Save, Inc.
| Docket Number: | 2006-CA-01174-COA Linked Case(s): 2006-CA-01174-COA2006-CT-01174-SCT |
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| Oral Argument: | 01-22-2008 | |
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| Court of Appeals: |
Opinion Link Opinion Date: 04-22-2008 Opinion Author: CARLTON, J. Holding: Reversed and Rendered |
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| Additional Case Information: |
Topic: Contract - Fraud - Nondisclosure - Fiduciary relationship Judge(s) Concurring: KING, C.J., LEE AND MYERS, P.JJ., IRVING, CHANDLER, GRIFFIS, BARNES, ISHEE AND ROBERTS, JJ. Procedural History: Jury Trial Nature of the Case: CIVIL - CONTRACT |
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| Trial Court: |
Date of Trial Judgment: 01-25-2006 Appealed from: LEE COUNTY CIRCUIT COURT Judge: Thomas J. Gardner Disposition: JURY VERDICT FOR PURCHASERS OF FLOODED PROPERTY Case Number: CV04-062(G)L |
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| Party Name: | Attorney Name: | Brief(s) Available: | ||
| Appellant: | TOMMY MORGAN |
REBECCA L. HAWKINS,
RACHEL MARIE PIERCE,
ROBERT Q. WHITWELL,
FRED L. BANKS,
WILLIAM M. BEASLEY |
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| Appellee: | GREEN-SAVE, INC. AND WALTER J. FLEISHHACKER | THOMAS WICKER |
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Synopsis provided by:  If you are interested in subscribing to the weekly synopses of all Mississippi Supreme Court and Court of Appeals hand downs please contact Tammy Upton in the MLI Press office. |
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| Topic: | Contract - Fraud - Nondisclosure - Fiduciary relationship |
| Summary of the Facts: | Green-Save, Inc., and Walter Fleishhacker filed suit against Tommy Morgan, seeking damages for alleged fraud in the sale of 2.1 acres of land. Specifically, Green-Save claimed that Morgan concealed that a portion of the property was situated in a flood plain and misrepresented that natural gas would be available to the property. At the conclusion of trial, the jury returned a verdict in favor of Green-Save in the amount of $325,000. Morgan appeals, and Green-Save cross-appeals. |
| Summary of Opinion Analysis: | In order to establish fraud, a plaintiff must show the following by clear and convincing evidence: a representation, its falsity, its materiality, the speaker's knowledge of its falsity or ignorance of its truth, his intent that it should be acted on by the hearer and in the manner reasonably contemplated, the hearer's ignorance of its falsity, his reliance on its truth, his right to rely thereon, and his consequent and proximate injury. Morgan argues that Green-Save failed to prove that he committed an affirmative act to conceal that a portion of the property was located in a flood plain. It is undisputed that Morgan made no representation regarding whether the property was in a flood plain. In order to create liability for nondisclosure, the defendant’s silence must relate to a material fact or matter known to the party and as to which it is his legal duty to communicate to the other contracting party. Morgan’s statements regarding the property’s commercial character and development plans in no way touch on the point of whether the property is in a flood zone. These statements cannot be considered an act designed to prevent Green-Save from discovering that the property was in a flood plain. In addition, Green-Save failed to prove that a fiduciary relationship existed between it and Morgan. The record establishes that the sale of the subject property was nothing more than an arm’s length business transaction between two parties, each looking out for their own interests. While Green-Save may have trusted Morgan as a reputable real estate developer, this trust does not create a fiduciary relationship. With regard to the natural gas claim, Green-Save alleged that Morgan represented that all utilities would be available to the property. At the time Green-Save filed suit, a natural gas line had not been run to the property because the gas company decided that such action would be unprofitable. Morgan’s statement that “all utilities” would be available was not a representation of past or presently existing facts. Rather, it was a representation of a future state of facts, which, in order to come to fruition, depended on a number of factors largely outside of Morgan’s predictability or control. The circumstances are too attenuated to establish that Morgan possessed a present intent not to perform when he made the statements. Accordingly, the judgment is reversed and rendered in favor of Morgan. |
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