Sandvick v. Lacrosse

747 N.W.2d 519 (N.D. 2008)

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Nature of the Case

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Facts

In May 1996, Ps and Ds purchased three oil and gas leases. They were standard, paid-up leases with terms of five years and did not contain any provision for extending or renewing them. In November 2000, D purchased three oil and gas leases referred to as the 'Horn Top Leases' and were set to begin at the expiration of the initial Horn Leases from 1996 between P and D. The top leases covered the same acreage as the Horn Leases and had a five-year term. Prior to purchasing the top leases, D twice offered to purchase P's interests in the Horn leases, but Ps refused. D testified he did not inform either of the Ps that Ds had purchased the top leases. In 2004, Ps sued Ds, claiming they breached their fiduciary duties by not offering Ps an opportunity to purchase the top leases with them. The district court concluded no partnership or joint venture existed. Ps appealed. On appeal, Ps argued that the court erred in concluding the parties were not partners.