Below v. Norton

2008 WI 77, 751 N.W.2d 351, 310 Wis. 2d 713, 2008 Wisc. LEXIS 325

• Court: Wisconsin Supreme Court
• Decided: July 1, 2008
• Docket: 2005AP2855
• Status: Published

Opinions

N. PATRICK CROOKS, J.

¶ 1. This is a review of a published decision of the Court of Appeals,¹ which reversed in part, affirmed in part, and remanded the decision of the Circuit Court for Milwaukee County, Judge Michael D. Guolee.

¶ 2. Petitioner, Shannon Below (Below), seeks review of the court of appeals' decision. The circuit court had granted the motion to dismiss of the respondents, Dion R. Norton and Dana Norton (the Nortons).

¶ 3. There are two principal issues upon review. The first issue is whether the economic loss doctrine (ELD) bars common-law claims for intentional misrepresentation² that occur in the context of residential real estate transactions. The second issue is whether the ELD bars common-law claims for intentional misrepresentation that occur in the context of noncommercial real estate transactions.

¶ 4. We affirm the decision of the court of appeals. We hold that the ELD bars common-law claims for intentional misrepresentation in real estate transactions, whether such claims occur in the context of residential³ or noncommercial sales, such as the one in the case before us. We do not draw a distinction between the terms "residential" and "noncommercial" here, because either term fits the real estate transaction at issue.

¶ 5. Below is not left without a remedy. A purchaser of a home, as well as real estate brokers and agents, can all be assured that applying the ELD still leaves statutory and contractual remedies available where misrepresentation has occurred. We note that Below's claim under Wis. Stat. § 100.18 (2003-04)⁴ for false advertising was remanded by the court of appeals to the circuit court for a trial on its merits. The court of appeals' decision on that issue was not presented for our review. Section 100.18 provides a remedy for more than merely "false advertising," in that it covers fraudulent representations made to even one prospective purchaser. See K&S Tool & Die Corp. v. Perfection Mach. Sales, Inc., 2007 WI 70, ¶¶ 21, 23, 301 Wis. 2d 109, 732 N.W.2d 792.

¶ 6. In our K&S Tool & Die Corporation opinion, we stated that the legislature intended Wis. Stat. § 100.18 " 'to protect the residents of Wisconsin from any untrue, deceptive or misleading representations....'" Id., ¶ 21 (citation omitted). Furthermore, we reiterated that a statement that was made to only one individual could qualify for the protections afforded by § 100.18. Id. Clearly, a purchaser of residential or noncommercial real estate, such as Below, is protected by § 100.18 from the false representations of a home seller. If Below proves that claim, she shall recover her "pecuniary loss, together with costs, including reasonable attorney fees ...." See Wis. Stat. § 100.18(ll)(b)2.

¶ 7. We note that the issue of whether the ELD bars claims under Wis. Stat. § 895.446⁵ (formerly Wis. ) for a violation of Wis. Stat. § 943.20(1)(d) also was presented for our review. However, we decline to address that issue in this opinion, and we remand that issue to the circuit court. We do so because the record of the proceedings before the circuit court is unclear as to why this claim was dismissed. Furthermore, this issue was not directly addressed and discussed by the court of appeals. We cannot determine from the record before us on review whether the circuit court dismissed that claim: (1) because it was insufficient and fatally flawed, so that a claim upon which relief could be granted was not stated; or (2) because the circuit court believed that claim was barred by the ELD. As a result, we remand that issue to the circuit court for further proceedings. Upon remand, the circuit court should clearly state that court's holding on that statutory claim. The circuit court should review this court's recent decision in Stuart v. Weisflog's Showroom Gallery, Inc., 2008 WI 22, ¶ 33, 308 Wis. 2d 103, 746 N.W.2d 762. That case addressed the issue of whether the statutory claim involved therein was barred by the ELD. In that case, we stated, "We are satisfied that the ELD cannot apply to statutory claims . ..." Id.

HH

¶ 8. This case involves a real estate transaction in which Below purchased a house on the south side of Milwaukee, Wisconsin from the Nortons in February of 2004. Because Below's claims were dismissed when the circuit court granted the Nortons' motion to dismiss, the relevant facts are brief and undisputed.

¶ 9. The Nortons completed the statutorily required property condition report when they put their house on the market. In their property condition report, the Nortons represented that they were not aware of any defects with the house's plumbing system, except for a problem with their bathtub's drain handle.

¶ 10. Below reached an agreement with the Nortons to purchase the house, and the transaction closed. Below and the Nortons did not have any personal contact during this process. After Below moved into the house, she learned that the sewer line that ran between the house and the street was broken.

¶ 11. On May 4, 2004, Below filed the present action against the Nortons in the Circuit Court for Milwaukee County. In Below's complaint, she alleged claims for: (1) intentional misrepresentation; (2) strict responsibility misrepresentation; (3) negligent misrepresentation; (4) misrepresentation in violation of Wis. Stat. § 100.18; and (5) misrepresentation in violation of Wis. Stat. §§ 895.446 and 943.20(1)(d).⁶ Below's complaint alleged that the Nortons knew of the defect with the sewer line before the house's sale, and misrepresented their knowledge to induce Below to purchase the house. Below alleges that she relied on this misrepresentation when purchasing the house and that this defect, which was not disclosed in the property condition report, caused her to suffer a pecuniary loss.

¶ 12. Below requested, and was granted, leave to file an amended complaint, which contained a breach of contract claim. However, both the circuit court and the court of appeals did not consider the amended complaint because they determined that Below did not properly file and serve her amended complaint. Below did not appeal the court of appeals' determination on that issue to this court. We note that the circuit court, on remand, has the authority to allow Below to attempt again to file and serve an amended complaint that contains her breach of contract claim. See Wis. Stat. § 802.09(1). The determination on whether to allow such an amendment is left to the discretion of the circuit court. Id.

¶ 13. On June 11, 2004, the Nortons filed both an answer to Below's complaint and a motion to dismiss her complaint on the grounds that the complaint failed to state a claim upon which relief could be granted and that some of Below's claims were barred by the ELD. In their accompanying memorandum in support of their motion to dismiss, the Nortons argued that Below's common-law intentional, negligent, and strict responsibility misrepresentation claims were barred by the ELD.⁷ On September 13, 2004, the circuit court adjourned its hearing on the Nortons' motion to dismiss Below's complaint until this court rendered its decision in Kaloti Enterprises, Inc. v. Kellogg Sales Co., 2005 WI 111, 283 Wis. 2d 555, 699 N.W.2d 205.

¶ 14. The circuit court held hearings on the Nortons' motion to dismiss Below's complaint on July 26, 2004, September 13, 2004, and October 17, 2005. On November 4, 2005, the circuit court formally granted the Nortons' motion to dismiss the complaint in its entirety. The circuit court held that the ELD barred Below's common-law intentional, negligent, and strict responsibility misrepresentation claims. The circuit court also dismissed Below's remaining claims, such as the Wis. Stat. §§ 100.18 and 895.446 claims, in one paragraph in the transcript as not being "applicable." The circuit court also stated, "I am going to dismiss these claims based on this transaction and this Complaint[,] and . .. these are not claims that [Below] can claim under these facts . . . ."

¶ 15. Below appealed the circuit court's decision to the court of appeals. Below argued that the circuit court had erred when it held that all of her tort claims were barred by the ELD. Holding that the ELD did not bar Below's Wis. Stat. § 100.18 claim, the court of appeals reversed the circuit court's dismissal of Below's false advertising misrepresentation claim under that statute. Accordingly, the court of appeals remanded that claim to the circuit court for trial.

¶ 16. In explaining its holding on the Wis. Stat. § 100.18 claim, the court of appeals stated:

Below claims that the trial court erred when it dismissed her false advertising Wis. Stat. § 100.18 misrepresentation claim. We agree. In Kailin v. Armstrong, 2002 WI App 70, ¶ 43, 252 Wis. 2d 676, 643 N.W.2d 132, we held that "the economic loss doctrine does not apply to claims under Wis. Stat. § 100.18" and that statements to a potential buyer may constitute a statement made to "the public" for the purposes of § 100.18, Kailin, 252 Wis. 2d 676, ¶ 44. Thus, statements made to Below prior to [the] acceptance of the offer may form the basis of a false advertising claim.

Below, 297 Wis. 2d 781, ¶ 11 (footnote omitted). The court of appeals also stated:

Here, Below's complaint sufficiently alleged a cause of action under Wis. Stat. § 100.18 to survive a motion to dismiss. Below alleged that the Nortons made an untrue representation which caused Below to suffer a pecuniary loss. If Below can prove her allegations at trial, she may recover on the false advertising claim. Accordingly, this cause of action should not have been dismissed. We reverse that portion of the trial court's order and remand for further proceedings.

Id., ¶ 13 (footnote omitted).

¶ 17. However, the court of appeals affirmed the circuit court's dismissal of all of the other claims in Below's complaint. The court of appeals held that the ELD barred the remainder of Below's tort claims, but it did not directly address and discuss the statutory claim under Wis. Stat. §§ 895.446 and 943.20(l)(d). Below filed a petition for review of the court of appeals' decision, which we granted.

I — I HH

¶ 18. This review results from the court of appeals' action in its examination of the circuit court's grant of the Nortons' motion to dismiss Below's complaint in its entirety. A motion to dismiss for failure to state a claim requires a determination of whether a complaint is legally sufficient to put forth a claim for which relief can be granted. Watts v. Watts, 137 Wis. 2d 506, 512, 405 N.W.2d 303 (1987). A complaint should be dismissed as being legally insufficient only if there are no conditions under which the plaintiff can recover. Ollerman v. O'Rourke Co., 94 Wis. 2d 17, 24, 288 N.W.2d 95 (1980). As this court has stated, "The facts pleaded and all reasonable inferences from the pleadings are admitted to be true, but only for the purpose of testing the legal sufficiency of the claim, not for the purpose of trial." Id. We review a complaint's dismissal for failure to state a claim de novo. Tietsworth v. Harley-Davidson, Inc., 2004 WI 32, ¶ 11, 270 Wis. 2d 146, 677 N.W.2d 233.

¶ 19. Whether the ELD applies to bar a claim under a given set of facts presents a question of law that is subject to our de novo review. Linden v. Cascade Stone Co., 2005 WI 113, ¶ 5, 283 Wis. 2d 606, 699 N.W.2d 189.

M 1 — I HH

¶ 20. The principal issues upon review are whether the ELD bars common-law claims for intentional misrepresentation that occur in the context of residential, or noncommercial, real estate transactions.

¶ 21. On review, Below argues that this court should determine that the ELD does not bar common-law intentional misrepresentation claims arising from residential, or noncommercial, real estate transactions, because she claims that this court has not applied our Kaloti decision outside of a commercial context. Alternatively, Below argues that the Kaloti fraud in the inducement exception to the ELD should apply to her case. Kaloti Enters., Inc., 283 Wis. 2d 555, ¶ 42. Below further asserts that consumers are in a poor position to protect themselves against fraud because, unlike commercial parties, they do not routinely purchase houses or large goods. Below argues that noncommercial purchasers should not have the burden of allocating the risk that they will be defrauded. Finally, Below contends that there are numerous attributes of such real estate transactions that render the ELD's rationale inapplicable.

¶ 22. On review, the Nortons argue that the ELD should bar common-law intentional misrepresentation claims in residential, or noncommercial, real estate transactions. They contend that the court of appeals correctly applied existing case law concerning the ELD to the particular facts of the present case. The Nortons also assert that the ELD's rationale, that buyers are adequately protected by the contractual remedies that they negotiate, applies with equal force to residential, or noncommercial, real estate transactions. As a result, the Nortons argue that buyers of such real estate should consider the risk of the seller committing fraud, and the Nortons further suggest that homebuyers are in the best position to insure against such a risk.

¶ 23. For the reasons discussed in detail below, we hold that the ELD does bar common-law claims for intentional misrepresentation that occur in the context of residential, or noncommercial, real estate transactions.

¶ 24. The ELD "is a judicially created doctrine that seeks to preserve the distinction between contract and tort." Ins. Co. of N. Am. v. Cease Elec., Inc., 2004 WI 139, ¶ 15, 276 Wis. 2d 361, 688 N.W.2d 462 (citation omitted). The ELD also seeks to protect " 'parties' freedom to allocate economic risk by contract....'" Kaloti Enters., Inc., 283 Wis. 2d 555, ¶ 28 (citation omitted). Furthermore, the ELD is meant to encourage the purchaser, who is the party best situated to assess the risk of his or her economic loss, to assume, allocate, or insure against that risk. Id. For the purposes of the ELD, we have defined an "economic loss" as being " 'damages resulting from inadequate value because the product is inferior and does not work for the general purposes for which it was . .. sold.'" Id., ¶ 29 (citation omitted). This court also has held that a recovery for an "economic loss" refers to a recovery that results either from a product failing in its intended use or from a product "failing to live up to a contracting party's expectations." Id. (citation omitted).

¶ 25. In the present case, Below's alleged damage, the house's inadequate value, is an economic loss because the house is allegedly inferior. The house is allegedly inferior because its broken sewer line prevents the house from fulfilling one of its intended uses, and also prevents the house from fulfilling one of the general purposes for which it was sold, basic sanitary needs. The contracting party, here Below, could normally⁸ recover her economic loss, which resulted when the house did not live up to her expectations, through contractual remedies because of her home sales contract.

¶ 26. The case law on the ELD leads us to the result that we reach in the present case, that the ELD bars common-law claims for intentional misrepresentation that arise in the context of residential real estate transactions. This court has applied the ELD to bar both negligence and strict liability claims that arise in the context of consumer goods transactions. See State Farm Mut. Auto. Ins. Co. v. Ford Motor Co., 225 Wis. 2d , 592 N.W.2d 201 (1999). Additionally, in Digicorp, Inc. v. Ameritech Corp., 2003 WI 54, ¶¶ 4, 12, 262 Wis. 2d 32, 662 N.W.2d 652, this court reaffirmed that the ELD barred a recovery for solely economic losses in intentional misrepresentation cases. Furthermore, in Van Lare v. Vogt, Inc., 2004 WI 110, ¶¶ 11, 21, 274 Wis. 2d 631, 683 N.W.2d 46, though not specifically deciding whether the ELD covered "all real estate transactions," we held that the ELD can bar at least some common-law misrepresentation claims in such transactions. Id., ¶ 21. Indeed, in Van Lare, we held that the ELD "may not be discarded simply because a transaction involves real estate." Id.

¶ 27. In Kaloti, this court decided that the ELD bars misrepresentation claims that arise in a contractual setting, unless the misrepresentation falls under a narrow fraud in the inducement exception to the ELD. Kaloti Enters., Inc., 283 Wis. 2d 555, ¶ 42. For this narrow fraud in the inducement exception to apply, the misrepresentation must have induced the plaintiff to enter into the contract and must not have been specifically related to the subject matter of the contract. Id. Put another way, for this narrow exception to apply, the misrepresentation must be" 'extraneous to, rather than interwoven with, the contract.'" Id. (citation omitted).

¶ 28. Of particular relevance to our decision in the present case are this court's previous decisions in Linden, 283 Wis. 2d 606, and Wickenhauser v. Lehtinen, 2007 WI 82, 302 Wis. 2d 41, 734 N.W.2d 855. It seems clear that we decided in Linden that the ELD applies to residential real estate transactions.

¶ 29. In Linden, this court affirmed the circuit court's grant of summary judgment that dismissed, as barred by the ELD, James and Dianne Linden's (the Lindens) negligence claims against some subcontractors who had participated in the construction of their house. Linden, 283 Wis. 2d 606, ¶ 1. The Lindens alleged that the subcontractors were negligent in performing work under a written construction contract. Id., ¶ 3. In a context that involved residential real estate, this court held that the circuit court was correct in holding that the ELD barred the Lindens' tort claims against the subcontractors. Id., ¶¶ 3, 4. Specifically, we decided that the ELD barred negligence claims in the real estate setting because we were convinced that the written contract for the construction of the Lindens' house was primarily one for goods, to which the ELD applied, and not primarily one for services. Id., ¶ 22.

¶ 30. Most recently, in our decision in Wicken-hauser, we applied the fraud in the inducement exception to the ELD in the context of a noncommercial real estate transaction. Wickenhauser, 302 Wis. 2d 41, ¶ 3.

¶ 31. The Wickenhausers bought 300 additional acres in 1997 for their dairy farm from Thomas Burow, and they obtained their financing from Jack Lehtinen (Lehtinen). Id. Lehtinen asked the Wickenhausers to sign an option contract that gave him a three-year right to buy the 300 acres for $300,000, purportedly as a security for the loans, and Lehtinen allegedly told the Wickenhausers that he would not record the option. Id., ¶ 5. In contrast, Lehtinen "contended that in exchange for the $66,000 loan, together with his promise to secure an additional loan of $200,000 . . ., the Wicken-hausers agreed to make Lehtinen one-half owner of the 300-acre parcel." Id.

¶ 32. Lehtinen filed a lawsuit (the first action) against the Wickenhausers seeking enforcement of his option, which he had recorded, to buy the 300 acres. Id., ¶ 6. In their answer to the first action, the Wicken-hausers asserted an affirmative defense that Lehtinen had fraudulently induced them to sign the option. Id., ¶ 7. The Wickenhausers then filed a lawsuit (the second action) seeking to quiet title to the 300 acres in their names and also seeking "damages arising from the fraudulent misrepresentations Lehtinen made to induce them to sign the option." Id.

¶ 33. In the first action, the circuit court found for the Wickenhausers and held that they "did not agree to grant Lehtinen an ownership interest in the 300-acre parcel." Id., ¶ 9. In that action, the circuit court also granted rescission of the option because: (1) it was void for lack of consideration; (2) Lehtinen had made material misrepresentations that the Wickenhausers had reasonably relied upon to their detriment; and (3) Lehtinen had acted as a dual agent when he induced the Wickenhaus-ers into signing the option. Id. In the second action, the circuit court awarded the Wickenhausers both compensatory and punitive damages, and the circuit court denied Lehtinen's motion for summary judgment based on claim preclusion. Id., ¶ 1.

¶ 34. This court held that the Wickenhausers had stated a claim for intentional misrepresentation against Lehtinen that was " 'extraneous to, rather than interwoven with, the contract.'" Id., ¶ 41. As a result, we applied the narrow fraud in the inducement exception to the ELD, because "Lehtinen's misrepresentations were made to induce the Wickenhausers to sign the option." Id. We stated, "The misrepresentations did not relate to Lehtinen's performance of the contract, which was to obtain [financing for the land purchase].⁹ Therefore, this fraud gives rise to an independent cause of action in tort."¹⁰ Id.

¶ 35. Significantly, in Wickenhauser, Chief Justice Abrahamson's concurrence described the majority opinion as extending the ELD by holding, for the first time, "that the economic loss doctrine is applicable to the present noncommercial real estate transaction involving at least one unsophisticated party negotiating without counsel and without a fully written, bargained-for contract." Id., ¶ 68 (Abrahamson, C.J., concurring). Citing Linden, the majority opinion disagreed with the concurring opinion's statement that the ELD was being applied for the first time in Wickenhauser in a case arising out of a transaction involving residential, or noncommercial, real estate. Id., ¶ 42, n.15. In doing so, the majority stated that its opinion did "not extend the economic loss doctrine into new contexts. For example, in a recent case, Linden.. ., we concluded that a contract to construct residential real estate was subject to the economic loss doctrine . . .." Id. (citation omitted). As Chief Justice Abrahamson's concurrence in Wickenhauser indicates, the effect of the majority opinion in Wickenhauser was to hold that the ELD applied to noncommercial real estate transactions. Id., ¶ 68 (Abrahamson, C.J., concurring).

¶ 36. It appears that the majority, as well as the concurrence, in Wickenhauser drew no distinction between the terms "residential" and "noncommercial." In the case before us, it seems unnecessary to draw such a distinction because either term fits the real estate transaction at issue here. Based on the case law cited previously, and given the discussions and the analyses in the majority opinion and the concurrence in Wicken-hauser, we are satisfied that the ELD bars common-law intentional misrepresentation claims arising out of residential, or noncommercial, real estate transactions, such as the one in the case before us.

¶ 37. Additionally, the facts presented in the present case support our conclusion that the ELD bars common-law intentional misrepresentation claims arising out of residential, or noncommercial, real estate transactions. The record before us reflects that Below received a completed property condition report in accordance with the requirements of Wis. Stat. § 709.02. Under that statute, and also under Wis. Stat. § 709.03, the required property condition report that Below received contained a notice that she may want to obtain either professional advice or an inspection of the property. Under those statutes, the required property condition report also contained a disclaimer that the buyer, here Below, acknowledged that a professional inspector's technical knowledge may be required to detect certain defects or code violations. There is noth-ingin the record before us that indicates whether Below heeded this advice and hired a professional inspector before closing on the home. Regardless, if the Nortons knew about the defect with the sewer line and failed to disclose the defect, as required by these statutes, then the Nortons may very well have breached the contract's terms. As a result, in addition to her pending Wis. Stat. claim, Below might normally have been in a position to pursue a breach of contract claim against the Nortons for which contractual remedies would have been available.¹¹

¶ 38. Under the protections afforded to real estate purchasers by Wis. Stat. § 709.02, purchasers are protected by contract and, thus, by contractual remedies. Accordingly, the ELD should bar common-law claims for intentional misrepresentation that arise in the context of residential, or noncommercial, real estate transactions when, as here, the damages sought are purely economic. Clearly, purchasers have adequate contractual and statutory remedies, if needed.

¶ 39. Furthermore, we do not agree with Below that the Kaloti fraud in the inducement exception to the ELD applies to the facts of the present case. As discussed, the Kaloti fraud in the inducement exception to the ELD only applies when the misrepresentation in question induced the plaintiff to enter into the contract, and that misrepresentation must be " 'extraneous to, rather than interwoven with, the contract.'" Kaloti Enters., Inc., 283 Wis. 2d 555, ¶ 42 (citations omitted). This is so because only where the alleged misrepresentation did not specifically relate to the subject matter of the contract would the plaintiff be unable to protect himself or herself through contract negotiations. See Digicorp, 262 Wis. 2d 32, ¶ 48. In the present case, if the Nortons were aware of the broken sewer line, they would have been obligated under Wis. Stat. § 709.02 to disclose that fact to Below. As a result, the broken sewer line does not meet the requirement for the Kaloti exception of being a matter that is "extraneous" to the contract's subject matter, and the Kaloti exception does not apply in the present case. Kaloti Enters., Inc., 283 Wis. 2d 555, ¶ 42 (citation omitted).

¶ 40. In summary, for the reasons stated herein, we are satisfied that the ELD bars common-law claims for intentional misrepresentation in real estate transactions that occur in the context of residential, or noncommercial, sales.

IV

¶ 41. We affirm the decision of the court of appeals. We hold that the ELD bars common-law claims for intentional misrepresentation in real estate transactions, whether such claims occur in the context of residential, or noncommercial, sales, such as the one in the case before us. We do not draw a distinction between the terms "residential" and "noncommercial" here, because either term fits the real estate transaction at issue.

¶ 42. Below is not left without a remedy. A purchaser of a home, as well as real estate brokers and agents, can all be assured that applying the ELD still leaves statutory and contractual remedies available where misrepresentation has occurred. We note that Below's claim under Wis. Stat. § 100.18 for false advertising was remanded by the court of appeals to the circuit court for a trial on its merits. The court of appeals' decision on that issue was not presented for our review. Section 100.18 provides a remedy for more than merely "false advertising," in that it covers fraudulent representations made to even one prospective purchaser. See K&S Tool & Die Corp., 301 Wis. 2d 109, ¶¶ 21, 23.

¶ 43. In our K&S Tool & Die Corporation opinion, we stated that the legislature intended Wis. Stat. § 100.18 " 'to protect the residents of Wisconsin from any untrue, deceptive, or misleading representations ....'" Id., ¶ 21 (citation omitted). Furthermore, we reiterated that a statement that was made to only one individual could qualify for the protections afforded by § 100.18. Id. Clearly, a purchaser of residential or noncommercial real estate, such as Below, is protected by § 100.18 from the false representations of a home seller. If Below proves that claim, she shall recover her "pecuniary loss, together with costs, including reasonable attorney fees . . . ." See Wis. Stat. § 100.18(ll)(b)2.

¶ 44. The issue of whether the ELD bars claims under Wis. Stat. § 895.446 for a violation of Wis. Stat. § 943.20(l)(d) also was presented for our review. However, we decline to address that issue in this opinion, and we remand that issue to the circuit court. We do so because the record of the proceedings before the circuit court is unclear as to why this claim was dismissed. Furthermore, the issue was not directly addressed and discussed by the court of appeals. We cannot determine from the record before us on review whether the circuit court dismissed that claim: (1) because it was insufficient and fatally flawed, so that a claim upon which relief could be granted was not stated; or (2) because the circuit court believed that claim was barred by the ELD. As a result, we remand that issue to, the circuit court for further proceedings. Upon remand, the circuit court should clearly state that court's holding on that statutory claim. The circuit court should review this court's recent decision in Stuart, 308 Wis. 2d 103, ¶ 33. That case addressed the issue of whether the statutory claim involved therein was barred by the ELD. In that case, we stated, "We are satisfied that the ELD cannot apply to statutory claims ...." Id.

By the Court. — The decision of the court of appeals is affirmed, and this matter is remanded to the circuit court for actions consistent with this opinion.

1 Below v. Norton, 2007 WI App 9, 297 Wis. 2d 781, 728 N.W.2d 156.

2 Below's common-law negligent misrepresentation and strict responsibility misrepresentation claims are not addressed herein, because Below conceded in her petition for review that the ELD barred those claims. See, e.g., State Farm Mut. Auto. Ins. Co. v. Ford Motor Co., 225 Wis. 2d 305, 592 N.W.2d 201 (1999).

3 The court of appeals characterized the transaction here as a "residential real estate transaction." Below, 297 Wis. 2d 781, ¶ 17. The petition for review and the parties' briefs present separate issues concerning noncommercial and residential real estate transactions in relation to the ELD and a common-law claim for intentional misrepresentation.

4 All further references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.

5 Wisconsin Stat. § 895.80 has been renumbered as Wis. Stat. § 895.446, but the statute's text was not changed in any way that was material to this opinion (there were insignificant changes to the statute's title and also to § 895.446(4)). This opinion will refer to the renumbered § 895.446.

6 Below also alleged a sixth claim for rescission and restitution. As the circuit court and the court of appeals both correctly noted, neither constitutes a claim. Rather, both are remedies. Accordingly, we will not specifically address rescission or restitution.

7 As previously noted, Below's common-law negligent misrepresentation claim and her common-law strict responsibility misrepresentation claim are not addressed herein, because Below conceded in her petition for review that the ELD barred those claims.

8 We note, again, that Below requested, and was granted, leave to file an amended complaint, which contained a breach of contract claim. However, both the circuit court and the court of appeals did not consider the amended complaint because Below did not properly file and serve it. Below did not petition for review of the court of appeals' determination on that issue. Below may, of course, pursue her Wis. Stat. § 100.18 false advertising misrepresentation claim, because that claim was remanded to the circuit court for trial by the court of appeals, and that decision is not before us.

9 Accordingly, we disagree with the dissent's statement that ”[i]t is difficult to discern when, if ever, fraudulent inducement to a contract is 'extraneous to, rather than interwoven with, the contract.'" Dissent, ¶ 73. Contrary to the dissent's assertion, instead of "explaining the difficulty of how to apply the narrow exception" to the ELD, the pages of the law review article that the dissent cites simply recount this court's caselaw on that issue. Id.

10 Based on the record before us, including the residential offer to purchase and the real estate condition report, we are satisfied that the contract here included the purchase of both the house and the associated land. Accordingly, any undisclosed defects with the house were interwoven with, and not extraneous to, the contract to purchase here.

11 We note again that Below requested, and was granted, leave to file an amended complaint, which contained a breach of contract claim. However, Below did not properly file and serve her amended complaint.