Likens v. Prickett's Properties, Inc.

943 N.E.2d 816, 2011 Ind. App. LEXIS 109, 2011 WL 347029
CourtIndiana Court of Appeals
DecidedFebruary 4, 2011
DocketNo. 43A03-1008-PL-455
StatusPublished
Cited by4 cases

This text of 943 N.E.2d 816 (Likens v. Prickett's Properties, Inc.) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Likens v. Prickett's Properties, Inc., 943 N.E.2d 816, 2011 Ind. App. LEXIS 109, 2011 WL 347029 (Ind. Ct. App. 2011).

Opinion

OPINION

VAIDIK, Judge.

Case Summary

Terry Likens and Marti Likens, husband and wife, appeal the trial court’s grant of summary judgment in favor of realtor Jack Stump and real estate agency Prickett’s Properties, Inc. Stump represented the buyers in a real estate transaction involving the Likenses’ home but nevertheless directly contacted the Likenses, [818]*818who had their own realtor, to encourage them to accept the buyei’s’ offer. The Likenses accepted the buyers’ offer, but closing never occurred. The Likenses then sued Stump for negligence. According to Indiana Code chapter 25-34.1-10, Stump only owed the Likenses the duty to treat them honestly and not knowingly give them false information. Because the Likenses do not allege on appeal that Stump breached this specific duty, we affirm the trial court’s grant of summary judgment in favor of Stump and the agency he works for.

Facts and Procedural History

The Likenses listed their Backwater Road home in North Webster, Indiana, for sale with Remax realtor Carolyn Leiter. The Likenses signed an agency agreement with Leiter.

Stump is a realtor employed by real estate agency Prickett’s Properties. Stump represented Zachary and Holli Gre-dy, who wished to purchase a home in the North Webster area. Stump showed the Likenses’ home to the Gredys, and they wanted to buy it.

During the approximately weeklong negotiations that followed, Stump conveyed to the Likenses that the Gredys would not have the necessary cash to close for several months but that they would be able to close after concluding certain real estate transactions. Stump contacted the Lik-enses directly — and not through their own realtor Leiter — by phone and email and encouraged them to accept the Gredys’ offer. At the time, the Likenses had another offer pending on their home which Leiter had encouraged them to accept instead. Excerpts from Stump’s emails to Marti Likens provide:

• “I know I work differently from other realtors — I try to satisfy both sides and keep the ‘experience of buying or selling’ enjoyable.”
• “My legal background includes the Naval Legal Court Recording school at Newport, Rhode Island; Naval Legal Officer’s school at San Diego, CA and International Law at NETC May-port, FL.”
• “I know how to read and write contracts to keep this even for both parties. I’m not sure why other agents can’t try to be helpful.”
• “You did nothing wrong and I told your Dad this morning that the real problem is with your agent ... not you!”
• “[The Gredys] are finally convinced that your home is the one for them. I’ll be getting together with them later today to write the offer. Again, thank you for the opportunity to be of service.”

Appellants’ App. p. 129 (emphases added).

In addition, Stump advised the Likenses that the Gredys’ offer “was a good deal” and that they should “accept” it. Id. at 134. Stump told them that Zachary Gredy was a “financial whiz” and there would be “no reason ... to worry” about a delayed closing. Id. at 140. Stump also told the Likenses that the Gredys had “a secret financial deal going on” that he could not disclose and that it was going to be a cash deal, which was “going to close,” “no problem.” Id. at 143; see also id. (Stump telling the Likenses that “Zach ... speaks seven languages, he’s very smart, his wife is pregnant, they really need to get out of the house that they bought because of the mold....”).

On February 28, 2008, the Likenses and the Gredys executed a Purchase Agreement, which incorporated a Pre-Closing Possession Agreement and one Counter Offer. The first page of the Purchase Agreement lists Leiter as the listing broker and Stump as the selling broker. Id. [819]*819at 15. The final page of the Purchase Agreement provides:

25. ACKNOWLEDGMENTS: Buyer and Seller acknowledge that each has received agency office policy disclosures, has had agency explained, and now confirms all agency relationships. Buyer and Seller further acknowledge that they understand and accept agency relationships involved in this transaction. By signature below, the parties verify that they understand and approve this Purchase Agreement and acknowledge receipt of a signed copy.

Id. at 20, 93. The terms of the Purchase Agreement provide that the Gredys would purchase the Likenses’ Backwater Road home for $325,000. Closing was to occur on or before September 30, 2008. However, the Gredys were to receive possession on March 15, 2008, and pay the Likenses $2000 per month in rent until closing. In addition, the Gredys were required to place $10,000 in escrow. According to the Counter Offer, the earnest money was to be held by Stump in the form of a bank letter of guarantee of funds. Id. at 23.

Closing did not occur by September 30, 2008, and the bank letter of guarantee of funds was determined to be fraudulent. Accordingly, on February 9, 2009, the Lik-enses filed a multi-count complaint against the Gredys, Stump, and Prickett’s Properties. As for the Gredys, the Likenses alleged breach of contract for, among other things, failing to close by September 30, 2008, and failing to make rent payments for November and December 2008, pay taxes, and obtain property insurance. The Likenses also alleged that the Gredys committed fraud in remitting the fraudulent bank letter of guarantee of funds and in stating that closing would occur as soon as they sold two of their properties when in fact one property was an office building owned by Zachary’s father and the other property was in foreclosure.

As for Stump, the Likenses alleged two counts: (1) negligence/breach of agency duty and (2) fraud. The Likenses asserted that although Stump was the Gredys’ realtor, he “directly communicated with and advised [them] on the purchase/sale of the property” and encouraged them to accept the Gredys’ offer because, among other things, the Gredys were “solid buyers.” Id. at 11, 13. Because of Stump’s direct communications with them, the Likenses alleged that “Stump entered into a constructive agency relationship with [them] throughout the term of the negotiations and transaction.” Id. at 12. In addition, the Likenses alleged that Stump failed to ensure that the $10,000 bank letter of guarantee of funds was in fact valid and failed to ascertain the ownership/status of the properties claimed to be owned by the Gredys. Finally, the Likenses alleged that Prickett’s Properties was liable for Stump’s actions under the doctrine of re-spondeat superior.

In June 2010, Stump and Prickett’s Properties filed a motion for summary judgment concerning the claims against them. As for negligence and breach of agency duty, they argued that Stump did not owe the Likenses a duty because Stump was the Gredys’ agent and therefore no agency relationship existed between the Likenses and Stump. As for fraud, Stump and Prickett’s Properties argued that the Likenses failed to prove that Stump knew that any of the Gredys’ statements were false. Because Stump was not liable, they argued that Prickett’s Properties could not be either.

A hearing on the motion for summary judgment was held in July 2010, see id. at 4 (CCS entry), following which the trial court entered summary judgment “in favor of Defendants Prickett’s Properties, Inc.

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Cite This Page — Counsel Stack

Bluebook (online)
943 N.E.2d 816, 2011 Ind. App. LEXIS 109, 2011 WL 347029, Counsel Stack Legal Research, https://law.counselstack.com/opinion/likens-v-pricketts-properties-inc-indctapp-2011.