Vortt Exploration v. Chevron U.S.A.

Vortt Exploration (Vortt) (defendant) and Chevron (plaintiff) both had mineral rights to various portions of a 160-acre tract of land. Around 1978, Vortt contacted Chevron to request that the companies jointly operate the land. Chevron was interested and asked Vortt to submit a proposal, to which Vortt complied. Over the next four years, Vortt and Chevron negotiated the specifics of a joint-development agreement. During the negotiations, Vortt provided Chevron with confidential seismic services and diagrams, and Chevron used the information to drill an oil-producing well. In 1983, the parties ended negotiations without having reached an agreement. Thereafter, Chevron sued Vortt to invalidate certain leases held by Vortt, and Vortt counterclaimed to recover under quantum meruit for the seismic services provided to Chevron. The trial court entered judgment in favor of Vortt on the claim of quantum meruit in the amount of $178,750. The court found that Vortt had provided services with the expectation of the two companies reaching a joint-development agreement, that Vortt would not have provided services otherwise, and that Chevron was reasonably notified of Vortt’s expectation. The court of appeals reversed, concluding that the trial court’s factual findings did not support that Vortt reasonably notified Chevron of Vortt’s expectation to be paid for providing seismic services. The Texas Supreme Court reviewed the matter.