Fraudulent Inducement to Enter Into A Contract

Did you know that you can recover damages for fraud against a party to a contract who had no intention of performing the contract at the time it is entered. The party is not limited to the breach of contract claim. This occurred in SAS & Associates, Inc. v. Home Mktg. Servicing, Inc., 168 S.W.3d 296 (Tex. App.—Dallas 2005, pet. denied) that involved a lease dispute between the landlord and tenant.

But if there is no evidence of the intent not to perform then the fraud finding will not stand. This occurred in Residences at Riverdale LP v Dixie Carpet Installations, Inc. 05-15-01030-CV, 2017 WL 2889276, at *6 (Tex. App.—Dallas July 7, 2017, no pet. h.) where the court of appeals set aside the fraud finding of the jury finding no such evidence to support the fraud finding of the jury. The court held that a breach combined with “slight circumstantial evidence” of fraud is enough to support a verdict for fraudulent inducement, but the record in that case did not support the fraud finding.