Lam v. PHUONG NGUYEN
335 S.W.3d 786
Tex. App.2011Background
- Lam and Mai sold their house to Nguyen for $1M,随后 Nguyen conveyed to Kumapayis who loaned Lam/Mai $300k; Lam/Mai paid $200k for repairs with $100k extra equity; Kumapayis defaulted on the loan; Lam/Mai sued Kumapayis and Nguyen alleging joint venture and conspiracy; Nguyen moved for summary judgment on Statute of Frauds/Haase; Lam/Mai amended petition to remove some claims and asserted fraud in inducing loan; trial court granted summary judgment and final take-nothing judgment in Nguyen's favor.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Statute of Frauds bars Lam/Mai's claims for fraud and related damages | Lam/Mai: damages are out-of-pocket, not benefit of bargain | Nguyen: damages seek benefit-of-bargain; subject to Statute of Frauds | Yes; summary judgment upheld; damages are benefit-of-bargain and barred |
| Whether Nguyen fraudulently induced Lam/Mai to sign the promissory note | Lam/Mai: inducement caused loan; damages are out-of-pocket | Nguyen: inducement claims barred by Statute of Frauds since damages seek bargain | No; on damages analysis, claim barred; conceded by outcome of first issue |
Key Cases Cited
- Haase v. Glazner, 62 S.W.3d 795 (Tex.2001) (statute forbids recovery of benefit-of-the-bargain damages for unenforceable promise)
- Formosa Plastics Corp. USA v. Presidio Eng'rs & Contractors, Inc., 960 S.W.2d 41 (Tex.1998) (fraudulent inducement damages limited by Statute of Frauds; out-of-pocket damages allowed only for reliance)
- ISG State Operations, Inc. v. Nat'l Heritage Ins. Co., 234 S.W.3d 711 (Tex.App.-Eastland 2007) (damages must flow directly from contract; inducement claims limited)
- Carr v. Christie, 970 S.W.2d 620 (Tex.App.-Austin 1998) (fraudulent inducement damages not recoverable as bargain)
- Baylor University v. Sonnichsen, 221 S.W.3d 632 (Tex.2007) (benefit-of-the-bargain vs. out-of-pocket damages)
- Gaubert v. Bank of Texas, N.A., 286 S.W.3d 546 (Tex.App.-Dallas 2009) (Statute of Frauds bars indirect attempts to recover for breach via fraud claims)
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex.2005) (summary judgment standard; de novo review)