Texas Causes of Action & Affirmative Defenses

Texas Causes of Action & Affirmative Defenses

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Thursday, September 10, 2009

The Elements of Fraud (Common Law Cause of Action) | Proving Causation

The Elements of Common Law Fraud [per 1st CoA] Elements of common-law fraud are that (1) a material representation was made; (2) the representation was false; (3) when the speaker made it he knew it was false or made it recklessly without any knowledge of its truth and as a positive assertion; (4) the speaker made it with the intention that it should be acted upon by the party; (5) the party acted in reliance on it ; and (6) he thereby suffered injury. In re FirstMerit Bank, N.A., 52 S.W.3d 749, 759 (Tex. 2001). Proving the Element of Causation To establish the element of causation in a fraud claim, a plaintiff must show that the defendant's acts or omissions were a cause-in-fact of foreseeable losses. Prospect High Income Fund, ML CBO IV v. Grant Thorton, LLP, 203 S.W.3d 602, 618 (Tex. App.--Dallas 2006, pet. denied) (citing Marathon Corp. v. Pitzner, 106 S.W.3d 724, 727 (Tex. 2003)). The defendant's acts or omissions are a cause-in-fact if the plaintiff can show, beyond mere conjecture, guess, or speculation, that an act or omission was a substantial factor in bringing about an injury which would not otherwise have occurred. Id. A plaintiff establishes reliance in a fraud claim by showing that the defendant's acts and representations induced it to either act or refrain from acting, to its detriment. Id. SOURCE: 01-07-00792-CV (9/10/09)

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