McNabb v. Hoeppner

2011 Ohio 3224

• Court: Ohio Court of Appeals
• Decided: June 22, 2011
• Docket: 10CA124
• Status: Published

Opinion

[Cite as McNabb v. Hoeppner, 2011-Ohio-3224.]

COURT OF APPEALS RICHLAND COUNTY, OHIO FIFTH APPELLATE DISTRICT

: JUDGES: WILLIAM McNABB, et al., : W. Scott Gwin, P.J. : John W. Wise, J. Plaintiffs-Appellants : Julie A. Edwards, J. : -vs- : Case No. 10CA124 : : FRANCES A. HOEPPNER, et al., : OPINION

Defendants-Appellees

CHARACTER OF PROCEEDING: Civil Appeal from Richland County Court of Common Pleas Case No. 08-CV-2130

JUDGMENT: Affirmed

DATE OF JUDGMENT ENTRY: June 22, 2011

APPEARANCES:

For Plaintiffs-Appellants For Defendants-Appellees

BRYON D. CORLEY DAVID D. CARTO 3 N. Main Street, Suite 714 Weldon, Huston & Keyser, LLP Mansfield, Ohio 44902 76 North Mulberry Street Mansfield, Ohio 44902-1241 [Cite as McNabb v. Hoeppner, 2011-Ohio-3224.]

Edwards, J.

{¶1} Appellants, William and Angela McNabb, appeal a summary judgment of

the Richland County Common Pleas Court dismissing their claims against appellee

Frances Hoeppner for fraud and negligent misrepresentation and against appellee

AccuSpec Inspection Service for breach of contract, negligence and breach of warranty.

STATEMENT OF FACTS AND CASE

{¶2} In 2008, Hoeppner listed her property at 1955 Banyan Drive, Mansfield,

for sale. In March of 2008, Hoeppner filled out a residential property disclosure form

which indicated that she had no knowledge of any current leaks or other material

problems with the roof or rain gutters, or of any other water intrusions on the property.

The disclosure form indicated that the owner’s statement was based on the owner’s

“actual knowledge” and the owner had not inspected generally inaccessible areas. The

form also included the following language:

{¶3} “THIS STATEMENT IS NOT A WARRANTY OF ANY KIND BY THE

OWNER OR BY ANY AGENT OR SUBAGENT REPRESENTING THE OWNER OF

THE PROPERTY. THIS STATEMENT IS NOT A SUBSTITUTE FOR ANY

INSPECTIONS. POTENTIAL PURCHASERS ARE ENCOURAGED TO OBTAIN

THEIR OWN PROFESSIONAL INSPECTION.”

{¶4} Appellants entered into a purchase agreement with Hoeppner in July,

2008. In the purchase agreement, appellants acknowledged that they were purchasing

the property “in its present physical condition after examination and inspection” by the

purchaser. The agreement further provided: Richland County App. Case No. 10CA124 3

{¶5} “Purchaser further acknowledges that Purchaser(s) are relying solely upon

such examination and inspection with reference to condition, value, character, and

dimensions of property, improvements, component systems and fixtures. Purchaser

acknowledges that neither Seller, nor Seller’s Agents(s) have made any representations

or warranties upon which Purchaser has been induced to rely; rather Seller and Seller’s

Agent(s) have encouraged Purchaser to conduct a thorough and independent

inspection(s) of the premises.”

{¶6} On July 28, 2008, appellants entered into a contract with appellee

AccuSpec for inspection of the house. The agreement specifically provided that the

inspector was not required to move any items that impeded access or limited visibility,

and the inspection was limited to “readily accessible areas of the property.” The

agreement, and the later-issued inspection report, both provided that the inspection

report:

{¶7} “IS NOT INTENDED TO BE USED AS A GUARANTEE OR WARRANTY,

EXPRESS OR IMPLIED, REGARDING THE ADEQUACY, PERFORMANCE,

CONDITION, STRENGTH OF ANY INSPECTED STRUCTURE, ITEM OR SYSTEM.

THE INSPECTION AND REPORT ARE NOT INTENDED TO REFLECT THE VALUE

OF THE PREMISES, NOR TO MAKE ANY REPRESENTATION AS TO THE

ADVISABILITY OR INADVISABILITY OF THE PURCHASE, MARKET ABILITY OR

THE SUITABILITY FOR USE.”

{¶8} Bruce Baker, owner of AccuSpec, inspected the property on July 28,

2008. When he issued his report to appellants he noted several areas of concern

regarding the condition of the roof, including prior cured leaks, amateur workmanship, Richland County App. Case No. 10CA124 4

erosion, exposed or lifted nails, moss and mildew, poorly patched flashing and tar on

flashing. Hoeppner agreed to pay appellants $1250.00 at closing to cover the estimated

cost of roof repairs.

{¶9} After taking possession of the house, appellants discovered an attic crawl

space and a basement crawl space that had not been inspected. Appellants found

plastic sheeting in the attic crawl space and a sump pump and operating dehumidifier in

the basement crawl space. After a second inspection of the home, AccuSpec noted

dampness in these areas but the inspector stated that his general findings in his first

inspection report were not materially affected by this second inspection.

{¶10} Appellants filed the instant action against Hoeppner and AccuSpec. The

court dismissed the complaint on summary judgment. Appellants assign a single error

on appeal:

{¶11} “THE TRIAL COURT ERRED AS A MATTER OF LAW IN GRANTING

SUMMARY JUDGMENT TO APPELLEES WHERE GENUINE ISSUES OF MATERIAL

FACT EXISTED AND THE APPELLEES WERE NOT ENTITLED TO SUMMARY

JUDGMENT AS A MATTER OF LAW.”

{¶12} Summary judgment proceedings present the appellate court with the

unique opportunity of reviewing the evidence in the same manner as the trial court.

Smiddy v. The Wedding Party, Inc. (1987), 30 Ohio St.3d 35, 36. As such, we must

refer to Civ. R. 56(C) which provides in pertinent part: “Summary Judgment shall be

rendered forthwith if the pleadings, depositions, answers to interrogatories, written

admissions, affidavits, transcripts of evidence, and written stipulations of fact, if any,

timely filed in the action, show that there is no genuine issue as to any material fact and Richland County App. Case No. 10CA124 5

that the moving party is entitled to judgment as a matter of law. No evidence or

stipulation may be considered except as stated in this rule. A summary judgment shall

not be rendered unless it appears from the evidence or stipulation, and only from the

evidence or stipulation, that reasonable minds can come to but one conclusion and that

conclusion is adverse to the party against whom the motion for summary judgment is

made, that party being entitled to have the evidence or stipulation construed most

strongly in the party’s favor.”

{¶13} Pursuant to the above rule, a trial court may not enter summary judgment

if it appears a material fact is genuinely disputed. The party moving for summary

judgment bears the initial burden of informing the trial court of the basis for its motion

and identifying those portions of the record that demonstrate the absence of a genuine

issue of material fact. The moving party may not make a conclusory assertion that the

non-moving party has no evidence to prove its case. The moving party must specifically

point to some evidence which demonstrates that the moving party cannot support its

claim. If the moving party satisfies this requirement, the burden shifts to the non-moving

party to set forth specific facts demonstrating that there is a genuine issue of material

fact for trial. Vahila v. Hall, 77 Ohio St.3d 421, 429, 1997-Ohio-259, citing Dresher v.

Burt, 75 Ohio St.3d 280, 1996-Ohio-107.

{¶14} We first address whether the trial court erred in granting summary

judgment to appellee Hoeppner. Appellants argue in their brief that disputed facts exist

as to whether Hoeppner had knowledge of the problems in the two crawl spaces and a

duty to disclose such defects. Richland County App. Case No. 10CA124 6

{¶15} An “as is” clause in a real estate contract places the risk upon the

purchaser as to the existence of defects and relieves the seller of any duty to disclose

latent defects. Rogers v. Hill (1998), 124 Ohio App.3d 468, 471; Funk v. Durant, 155

Ohio App.3d 99, 103, 2003-Ohio-5591. The “as is” contract provision cannot be relied

upon to relieve the sellers of liability on a claim for fraudulent misrepresentation. Id. at

103. While R. C. 5302.30 specifically states that the disclosure form required by the

statute is not a warranty, it can form the basis of a claim for false representation if the

seller makes false statements to the buyer therein, which are relied upon by a buyer.

Id.

{¶16} In summary, as long as the seller does not engage in fraud, an “as is”

clause bars any claims brought by a buyer. Scafe v. Property Restorations, Ltd.,

Cuyahoga App. No. 84447, 2004-Ohio-6296.

{¶17} To prove fraud, a plaintiff must show that there was: (a) a representation,

or where there is a duty to disclose, concealment of a fact, (b) which is material to the

transaction at hand, (c) made falsely, with knowledge of its falsity, or with such utter

disregard and recklessness as to whether it is true or false that knowledge may be

inferred, (d) with the intent of misleading another into relying on it, (e) justifiable reliance

upon the representation or concealment, and (f) resulting injury proximately caused by

the reliance. Burr v. Stark Cty. Bd. of Commrs. (1986), 23 Ohio St.3d 69, paragraph

two of the syllabus.

{¶18} In the instant case, the contract contained an “as is” clause. Appellee

Hoeppner therefore had no duty to disclose the existence of the moisture issues in the

crawl spaces, and is only liable if she fraudulently misrepresented the condition of the Richland County App. Case No. 10CA124 7

home when she stated on her disclosure form that she was not aware of any current

leaks or water intrusions on the property.

{¶19} There is no evidence to demonstrate that Hoeppner had knowledge of any

current water problems on the property. Hoeppner’s affidavit states that she and her

late husband purchased the house in 1988. From that time until shortly before his death

in May of 2006, her husband took care of repairs and maintenance for the home,

including replacing the roof in 1991 after a leak was discovered. Thereafter she was not

aware of any problems until October, 2006, when she hired a contractor to repair a leak

above the bedroom. She averred that at no time had she been in or viewed the attic

crawl space above the pantry, nor had she seen her husband in that area. Appellant

William McNabb admitted at his deposition that he had no evidence that appellee knew

the statements in the disclosure form concerning current leaks was false at the time she

made it. Tr. 23. He testified that he had no evidence that appellee Hoeppner

deliberately concealed the door to the basement crawl space. Tr. 76.

{¶20} In addition to presenting no evidence that Hoeppner knew her statements

concerning the condition of the roof were false, appellants have not demonstrated

justifiable reliance. Appellants were alerted to a series of problems concerning the roof

and accepted $1,250.00 from Hoeppner to repair the roof. Appellant admitted that the

access panel to the attic crawl space was visible to him when he and his wife looked at

the home prior to entering into the purchase agreement, and he did not ask appellee

Hoeppner for permission to look in that area, nor did he point this out to the home

inspector. Tr. 56-57. The purchase agreement specifically states that appellants were

not relying on any representations made by the seller. Richland County App. Case No. 10CA124 8

{¶21} Appellants also claimed negligent misrepresentation on the part of

Hoeppner. The doctrine of negligent misrepresentation provides recovery where: 1) a

party who, in the course of his business, profession or employment, or in any other

transaction in which he has a pecuniary interest, provides false information; 2) for the

guidance of another party in its business transaction, 3) causing the other party to suffer

pecuniary loss, 4) as a result of justifiable reliance on the information, 5) if the one

providing the information failed to exercise reasonable care or competence in obtaining

and communicating the information. Delman v. City of Cleveland Hts., (1989), 41 Ohio

St.3d 1, 4, 534 N.E.2d 835. The elements for negligent misrepresentation require a

plaintiff who sought guidance with respect to his business transactions from the

defendant. Nichols v. Ryder Truck Rental (June 23, 1994), Cuyahoga App. No. 65376,

unreported.

{¶22} As discussed with regard to the fraud claim, there is no evidence in the

record to demonstrate that Hoeppner’s statement that she was not aware of any current

leaks or water intrusions on the property was false. Further, appellants cannot show

that they sought her advice or guidance with respect to a business transaction.

Hoeppner and appellants were engaged in an arms-length business transaction, there

was no special relationship between them whereby appellants were specifically relying

on Hoeppner for advice. There is nothing in the record to suggest that Hoeppner failed

to exercise reasonable care in obtaining or communicating the information in the

disclosure form where the form specifically stated that it was based on her actual

knowledge and not on an inspection of generally inaccessible areas. Richland County App. Case No. 10CA124 9

{¶23} We next address whether summary judgment was appropriate as to

AccuSpec. Appellants argue that AccuSpec did not take the proper amount of time to

complete the inspection because the inspector was accommodating Hoeppner’s

schedule, and also argues generally that the inspection did not reveal problems in the

home.

{¶24} There is no evidence to suggest that the time AccuSpec spent in the home

was in violation of the contract or standards in the industry. AccuSpec’s contract with

appellants specifically stated that the inspector was not required to move items of

personal property that impeded access or limited visibility, and the inspection was

limited to readily accessible areas of the property. Despite admitted knowledge of the

attic access panel in the pantry, appellants did not specifically request that the inspector

move items in the pantry to access and inspect that area. Further, after appellants

discovered the crawl spaces, AccuSpec returned to the property, inspected these areas,

and found nothing that materially altered the findings in the original inspection report.

The trial court did not err in finding that appellants did not present evidence that

AccuSpec breached its contract with them nor did appellants present evidence of a

standard of care breached by AccuSpec to support their claim for negligence. Further,

appellants failed to present any evidence of warranties made by AccuSpec concerning

the condition of the property and the contract between the parties stated that the

inspection report was not intended as a warranty regarding the condition of the property. Richland County App. Case No. 10CA124 10

{¶25} The assignment of error is overruled.

{¶26} The judgment of the Richland County Common Pleas Court is affirmed.

By: Edwards, J.

Gwin, P.J. and

Wise, J. concur

______________________________

JUDGES

JAE/r0412 [Cite as McNabb v. Hoeppner, 2011-Ohio-3224.]

IN THE COURT OF APPEALS FOR RICHLAND COUNTY, OHIO

FIFTH APPELLATE DISTRICT

WILLIAM McNABB, et al., : : Plaintiffs-Appellants : : : -vs- : JUDGMENT ENTRY : FRANCES A. HOEPPNER, et al., : : Defendants-Appellees : CASE NO. 10-CA-124

For the reasons stated in our accompanying Memorandum-Opinion on file, the

judgment of the Richland County Court of Common Pleas is affirmed. Costs assessed

to appellants.

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