Amyot v. Luchini

932 P.2d 244, 1997 Alas. LEXIS 23, 1997 WL 60894
CourtAlaska Supreme Court
DecidedFebruary 14, 1997
DocketS-7170
StatusPublished
Cited by8 cases

This text of 932 P.2d 244 (Amyot v. Luchini) is published on Counsel Stack Legal Research, covering Alaska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Amyot v. Luchini, 932 P.2d 244, 1997 Alas. LEXIS 23, 1997 WL 60894 (Ala. 1997).

Opinion

OPINION

COMPTON, Chief Justice.

I. INTRODUCTION

The superior court held that a state statute requiring good faith disclosure of defects in residential real property transfers precludes a buyer from recovering from a seller under the theory of innocent misrepresentation. We affirm.

II. FACTS AND PROCEEDINGS

Robin Luchini and Sharon Luchini owned a house on Penrose Lane in Fairbanks. In preparation for the sale of the house, the Luchinis hired Kenneth Rydberg, a professional engineer, to inspect it. In an August 1993 letter, Rydberg opined that “the foundation is stable and the floor framing is satisfactory.” He further asserted that “[w]ith continued normal maintenance, the building should easily have a remaining useful life of over 35 years.”

Raymond Amyot and Shari Luster were interested in purchasing a home in which they could install a swimming pool. They visited the Luchinis’ house in August 1993, found that it would accommodate an indoor pool, and shortly thereafter began negotiating to purchase the house..

During the negotiation period, the Luchin-is gave Amyot a copy of Rydberg’s letter. Mr. Luchini completed and gave to Amyot a “Residential Real Property Transfer Disclosure Statement.” In this disclosure statement Mr. Luchini indicated that, to the best of his knowledge, there were no defects in the walls or foundation of the house. The Luchinis also gave Amyot a “Property Information Profile” which they had completed for the real estate listing service. In it they stated that the foundation was in “good” condition. Amyot knew that the foundation *245 was constructed of all-weather wood. The Luchinis also had informed him that sometime previously the fireplace had fallen through the floor and into the basement. 1

In October Amyot and the Luchinis entered into an earnest money receipt and purchase agreement; the purchase price was $181,500. In December the parties closed the sale.

While preparing the basement for installation of the pool, Amyot and Luster discovered that the foundation was defective. Amyot hired Bryan Borjesson, a professional engineer, to inspect the house, which he did on February 14, 1994. Borjesson informed Amyot that the foundation had completely failed.

Soon thereafter Amyot demanded that the Luchinis rescind the sale. They refused. Amyot obtained two repair estimates, both for approximately $100,000, and began replacing the failed foundation with a concrete foundation. 2

Amyot sued the Luchinis for the cost of the repairs under innocent, negligent, and intentional misrepresentation theories. Following briefing by the parties, the superior court concluded that innocent misrepresentation claims were precluded by AS 34.70.010 et seq.

After a two-week trial of Amyot’s other claims, the jury returned a verdict in favor of the Luchinis. On the special verdict form the jury answered “no” to these questions: (1) “Were the defendants negligent in not disclosing the condition of 2142 Penrose Lane?” and (2) “Did the defendants misrepresent the condition of 2142 Penrose Lane?” The superior court awarded the Luchinis attorney’s fees in the amount of $26,087.60, forty percent of their attorney’s fees.

Amyot appeals. He argues that the superior court erred in (1) ruling that AS 34.70.010 — 34.70.200 precludes innocent misrepresentation claims; (2) failing to grant his motion for summary judgment on the innocent misrepresentation claim; (3) failing to instruct the jury on innocent misrepresentation; (4) instructing the jury “that misrepresentations made on prescribed disclosure forms are not actionable unless such misrepresentations were negligent or willful”; and (5) granting enhanced attorney’s fees to the Luchinis.

III. DISCUSSION

A. Standard of Review

Whether AS 34.70.010 — 34.70.200 preclude innocent misrepresentation claims is a question of law to which the court applies its independent judgment. See Odum v. University of Alaska, Anchorage, 845 P.2d 432, 434 (Alaska 1993). “On questions of law, this court is not bound by the lower court’s decision .... [Its] duty is to adopt the rule of law that is most persuasive in light of precedent, reason, and policy.” Guin v. Ha, 591 P.2d 1281,1284 n. 6 (Alaska 1979).

B. Innocent Misrepresentation in Alaska

We first recognized the claim of innocent misrepresentation in Cousineau v. Walker, 613 P.2d 608 (Alaska 1980). We held that false statements as to the road frontage of the land and its gravel content made by a seller in a real estate listing could provide the basis for rescission of the sales contract, even if the statements were innocently made, and even if the buyer was negligent in relying on them. Id. at 616.

In Bevins v. Ballard, 655 P.2d 757, 762-63 (Alaska 1982), we extended innocent misrepresentation liability to real estate brokers, and reaffirmed Cousineau:

We have recognized a cause of action against the owner of realty who innocently *246 misrepresents its condition to the purchaser. Cousineau v. Walker, 613 P.2d 608 (Alaska 1980).... In so doing, we held that an owner guilty of even innocent misrepresentation could not hide behind the doctrine of caveat emptor. Id. at 614-16. This is so because owners are presumed to know the character and attributes of the land conveyed and buyers are consequently entitled to rely on the seller’s reasonable representations.

Bevins, 655 P.2d at 762 (emphasis omitted). 3

C. Effect of AS 34.70 on Innocent Misrepresentation Claims

Effective July 1, 1993, AS 34.70 governs disclosures in transfers of interests in residential real property. It provides:

Sec. 34.70.010. Disclosures in residential real property transfers. Before the transferee of an interest in residential real property makes a written offer, the trans-feror shall deliver by mail or in person a completed written disclosure statement in the form established under AS 34.70.050....
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Sec. 34.70.030. Liability after disclosure.

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Bluebook (online)
932 P.2d 244, 1997 Alas. LEXIS 23, 1997 WL 60894, Counsel Stack Legal Research, https://law.counselstack.com/opinion/amyot-v-luchini-alaska-1997.