Your sister is also likely to be liable. If she can pay a judgment, you may want to bring a claim of unjust enrichment against her. It is near certain that she has signed some document(s) for the energy company to receive funds. Those documents may support a claim of fraud. If judgment is given for fraud, it cannot be discharged in bankruptcy, as a general rule.
You may be able to sue them. Whether or not they acted in good faith, or even properly at all, depends on facts which you have not included in your summary. The company will need to prove that it acted reasonably, in order to avoid liability.
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You say that the oil company gave money to your sister in good faith, but then you state they did so without documentation. You need to determine the circumstances under which your sister received these funds before you can determine whether the oil company's action was proper. If it wasn't, you may have a cause of action against both the oil company and your sister. Hire a probate attorney to assist you in this matter.
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