law-constructive notice | actual-and-constructive-knowledge | imputed knowledge | "on notice" |

CONSTRUCTIVE NOTICE

Constructive notice creates an irrebuttable presumption of actual notice in some circumstances. HECI
Exploration Co, 982 S.W.2d at 887. In support of its argument that the Rosses could have been found to have
had constructive notice because actual knowledge of the fraud could have been acquired by examining public
records available at the Land Office, Shell relies on Mooney v. Harlin, 622 S.W.2d 83 (Tex. 1981), and
Sherman v. Sipper, 152 S.W.2d 319 (Tex. 1941). However, these cases involve specific types of public records
in specific situations. See Mooney, 622 S.W.2d at 85 (“Persons interested in an estate admitted to probate are
charged with notice of the contents of the probate records.”); Sherman, 152 S.W.2d at 321 (“Equally well
settled is the rule that where a person had a right to property, and he claims fraudulent statements were made
concerning the title to such property, when the records relating to such title are open to him he must exercise
reasonable diligence to discover such defect . . . .”). In both cases, the Court found a compelling rationale for
imposing constructive notice. HECI Exploration Co., 982 S.W.2d at 886–87. However, when the rationale for
imposing constructive notice is lacking, public records have not been held to create an irrebuttable presumption
of notice. Id. at 887; see Andretta v. West, 415 S.W.2d 638, 642 (Tex. 1967); see also Little v. Smith, 943 S.W.
2d 414, 421 (Tex. 1997).
Having concluded that the Rosses could not have reasonably discovered Shell’s fraudulent concealment based
on public records at the Land Office, we further conclude that these public records did not create an
irrebuttable presumption of notice. Therefore, the proposed instruction was inapplicable to the situation
presented by the evidence in this case. Accordingly, we hold that the trial court did not err in not submitting
Shell’s proposed instruction on constructive notice.
Shell Oil Company v. Ross (Tex.App.- Houston [1st Dist.] Feb. 25, 2010)(Jenning)
(
oil & gas law litigation - dispute over royalties, breach of contract, unjust enrichment, and fraud theories)
(
fraudulent concealment as tolling theory, constructive notice based on public record)
AFFIRM TRIAL COURT JUDGMENT: Opinion by
Justice Jennings     
Before Justices Jennings, Alcala and Higley   
01-08-00713-CV  Shell Oil Company, SWEPI LP d/b/a Shell Western E&P, Successor in Interest to Shell
Western E&P, Inc. v. Ralph Ross    
Appeal from 133rd District Court of Harris County
Trial Court Judge:
Hon. Lamar McCorkle
Dissenting Opinion by Justice Alcala in Shell Oil Co. v. Ross (would hold that lawsuit is barred by
limitations because no evidence establishes
fraudulent concealment of royalty underpayment by Shell)


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