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Real Property Click here for the full text of this decision FACTS: Thomas L. Pellegrini appeals a take-nothing judgment on his fraud claim against Cliffwood-Blue Moon Joint Venture Inc., Thomas McWhorter and Michel Bectel. Joint Venture was formed in 1997 to drill for oil and gas in a 150 square-mile area in Louisiana. Bectel and McWhorter were officers of Joint Venture. They also held a 20 percent ownership interest in Joint Venture through Blue Moon Exploration Co. Pellegrini, a consulting geophysicist, contracted with Joint Venture in 1997 in Texas to provide analysis of subsurface data for the 150 square mile area. Pellegrini was paid $9,000 at the conclusion of each of three project phases. For any prospects “developed” within the area during the term of the consulting contract, he also received an overriding royalty. However, a dispute arose between the parties as to whether one well, Prime Martin Well No. 1 (referred to during development as “the West Ridge Prospect”), was developed during the term of the contract. Prime Martin Well No. 1 was drilled in the West Ridge Field in Lafayette Parish in 1998. Pellegrini asserted his right to an overriding royalty from Prime Martin No. 1 under the contract. Joint Venture asserted the well was never a prospect of Joint Venture and rejected his claim. The prospect was asserted to be the result of a prior nearby dry hole, or unsuccessful drill. Essentially, the appellees asserted that the prospect was developed in 1996, after the dry hole, by investors in the dry hole, but not drilled until 1998 only because land interests were not settled until then. Joint Venture filed a declaratory judgment action against Pellegrini, who then sued Joint Venture, Bectel and McWhorter. Pellegrini alleged several theories of recovery, including breach of contract and fraud. However, Pellegrini’s claim was presented to the jury solely on the fraud theory, and he raises no issue on appeal concerning his breach-of-contract claim. Issues related to the Joint Venture’s declaratory judgment action were also submitted to the jury. The jury found that the West Ridge Prospect was developed prior to Pellegrini’s contract with Joint Venture, and that Joint Venture never owned any interest in the West Ridge Prospect. Those findings are not challenged on appeal. But the jury also found that McWhorter (but not Joint Venture or Bectel) committed fraud against Pellegrini “about whether he would be assigned an overriding royalty interest in any prospect developed during the term of the Geophysical Consulting Agreement,” and that Pellegrini was harmed by this fraud. Nevertheless, the jury awarded zero damages to Pellegrini. The trial court’s take-nothing judgment reflected the jury’s verdict. Pellegrini challenges the sufficiency of the evidence to support the finding of zero damages, and also challenges the failure of the jury to find fraud by Bectel and Joint Venture. Appellees respond that the trial court should not have submitted the fraud claim to the jury, because there can be no fraudulent failure to disclose when there is no legal duty to disclose. HOLDING:The judgment is modified to assess costs against appellant, and as modified is affirmed. The negotiations involved an arms-length transaction between parties who were expert in the subject matter of the contract. Pellegrini had been in the oil and gas business for a considerable period of time. The purpose of his work under the contract was to develop new oil and gas prospects. He was aware of the prior dry hole. Given the language of the contract as written, the parties had an interest, before entering into the contract, in identifying those “prospects” already “developed” and therefore not subject to the contract. Given the expertise of the participants, a party considering entering into the contract would be expected to discover and clarify this information. Pellegrini could reasonably be expected to make an investigation, ask questions, draw his own conclusions and protect his own interests. He cites no evidence the appellees knew that he was ignorant of the prior development of the West Ridge Prospect or that he did not have the ability or opportunity to learn of the prior development. Essentially, this case arose out of a contract dispute over the meaning of “developed” and the meaning of “prospect,” as those terms were used in the contract. But those disagreements relate to the breach of contract claim. Nondisclosure does not give rise to a fraud claim unless the circumstances first give rise to a duty to disclose the information. Here, Pellegrini did not lack the opportunity, knowledge, and expert ability to determine the prior development of the West Ridge Prospect � to identify and clarify whether a “prospect” “developed” from knowledge from the dry hole was to be included in the contract � before he entered into the contract. The court finds no duty to disclose the prior development of the West Ridge Prospect under the circumstances of this arms-length commercial transaction. Because there was no duty to disclose, the fraud claim should not have been submitted to the jury. OPINION:Gaultney, J.; McKeithen, C.J., Burgess and Gaultney, JJ.

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