Croslin v. Enerlex, Inc., 308 P.3d 1041

Plaintiffs are heirs of W.M. Croslin and Goldie Croslin, who owned a four net acre Seminole County mineral interest subject to an OCC pooling order (Order No. 442715) dated July 11, 2000, with accrued proceeds of about $9,961.71 held for Croslin.
In March 2008 Enerlex made unsolicited offers to buy the plaintiffs’ mineral interests, knowing the pooling order and accrued proceeds (and that unknown owner Croslin was listed with unknown address).
Enerlex sent offers with two bank drafts, a mineral deed, and a title-examination promise, but did not disclose the pooling order or accrued proceeds to the plaintiffs.
The mineral deeds conveyed the interest and included an “accruals, if any” provision, while the deed language suggested no knowledge of accrued proceeds and granted Enerlex broad agency to perfect transfer.
The plaintiffs executed the mineral deeds on March 31, 2008 without knowledge of the pooling order or accrued proceeds; they later discovered the proceeds and the pooling order.
Plaintiffs sued October 23, 2009 asserting constructive fraud and deceit, seeking rescission and damages; Enerlex counterclaimed for quiet title and ownership.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Duty to disclose pooling and proceeds	Croslins contend Enerlex owed a disclosure duty (production and accruals) when offering to buy and providing deeds.	Enerlex argues no such duty; offer letters and deeds do not constitute misrepresentation.	Yes; Enerlex owed a disclosure duty regarding accrued proceeds and pooling.
Rescission as a remedy for disclosure breach	Rescission appropriate due to false representation and concealment of material facts.	Rescission not warranted because the deed described the conveyed property and accruals were not disclosed.	Rescission is an appropriate equitable remedy.
Public policy and custodial taking statutes’ interplay	Statutes protecting undistributed pooled proceeds create a public policy requiring disclosure of accruals.	Statutes governing custodial taking and unclaimed property are separate; no policy to disclose accrued proceeds in private sale.	Public policy supports treating custodial taking statutes as a backdrop; statutes construed together.
Construction of the “if any” accrual language	The “accruals, if any” language and the deed’s breadth misled plaintiffs and concealed proceeds.	The language was not a misrepresentation and did not create a duty to disclose.	The language and conveyance created a duty to disclose the accruals; misrepresentation/concealment occurred.

Deardorf v. Rosenbusch, 206 P.2d 996 (1949 OK) (duty to disclose when speaking or partial disclosure creates false impression)
Berry v. Stevens, 31 P.2d 950 (1934 OK) (half-truths and misrepresentations actionable; duty to disclose important facts)
Uptegraft v. Dome Petroleum Corp., 764 P.2d 1350 (1988 OK) (constructive fraud from failure to disclose production information)
Varn v. Maloney, 516 P.2d 1328 (1973 OK) (concealment of material facts as fraud under production context)
TXO Production Corp. v. Oklahoma Corp. Comm'n, 829 P.2d 964 (1992 OK) (custodial taking statutes construed together to protect owners of unclaimed pooled proceeds)
Bowman v. Presley, 212 P.3d 1210 (2009 OK) (caveat emptor and materiality of seller representations in real estate context)