County Civil Court:  CONTRATCS – summary judgment - trial court erred in granting summary judgment in favor of realtor who represented seller – a factual dispute remains as to the realtor’s knowledge of information adversely affecting the value of the property and the adequacy of the disclosure of such adverse information – summary judgment reversed.  Lipp v. Ely, Appeal No. 04-0071AP-88B (Fla. 6th Cir. App. Ct. Nov. 9, 2005). 

 

 

IN THE CIRCUIT COURT FOR THE SIXTH JUDICIAL CIRCUIT

IN AND FOR PINELLAS COUNTY, FLORIDA

APPELLATE DIVISION

 

 

MARILYN I. LIPP,

                        Appellant,

vs.                                                                                    Appeal No.04-0071AP-88B

                                                                                         UCN522004AP000071XXXXCV

GREGORY W. ELY, SURIA NELSON,

and LADEAN BUIDENS,

                        Appellee.

____________________________________/

Appeal from Summary Judgment

Pinellas County Court

Judge Walt Fullerton

 

Tonu Toomepuu, Esquire

John M. Herbst, Esquire

Attorneys for Appellant

 

Robert Hitchens, Esquire

Attorney for Appellee

 

 

 

ORDER AND OPINION

 

            THIS CAUSE came before the Court on appeal, filed by Marilyn I. Lipp (Lipp), from the Order Granting Summary Judgment for Defendant Buidens,[1] entered August 26, 2004, in favor of Ladean Buidens (Buidens).  Upon review of the briefs, the record and being otherwise fully advised, the Court reverses the trial court’s ruling as set forth below.

            Buidens does not dispute Lipp’s Statement of the Case and Facts.  As set forth therein and supported by the record, on November 19, 2003, Lipp sued Gregory Ely, Suria Nelson, and Buidens for fraud in the inducement to enter into a residential sale and purchase contract of residential property on February 22, 2003.  Gregory Ely was the owner and seller of the property, Suria Nelson was the transaction realtor representing Lipp, and Buidens was the transaction realtor representing seller Ely.  Ely and Lipp never had any direct dealings, as all dealings were through Buidens and Nelson. 

On January 3, 2003, Ely was served with a Notice of Hearing to appear, on January 22, 2003, before the City of St. Petersburg Code Enforcement Board regarding 14 cited code violations,[2] specifically enumerated on a three-page document attached to the Notice of Hearing.  In his answers to interrogatories, Ely stated that he showed Buidens the code violations.  On February 22, 2003, Lipp signed a Residential Sale and Purchase Contract to buy the residential property. 

            In the Seller’s Property Disclosure Statement, received by Lipp on or about March 3, 2003, Ely answered three questions pertinent to this case:  “(a) Is there any existing or threatened legal action affecting the property?,” to which the “No” box was checked; “(b) Do you know of any violations of local, state, or federal laws or regulations relating to this property?,” which was left unanswered, and; (c) “Is there anything else that you feel you should disclose to a prospective buyer because it may materially and adversely affect the value or desirability of the property, e.g. zoning violations, nonconforming units, set back violations, zoning changes, road changes, etc.?”, to which the “Yes” box was checked.  In response to the follow-up to “explain in detail,” Ely wrote, in part (the last several words are not discernible), “back room has code violations from original owner, due to it not having owner occupied license.” 

Ely did not attach to the Disclosure Statement, nor provide to Lipp, the three-page list of cited code violations.  Lipp did not have a professional home inspection conducted and personally inspected the property only once.  The closing and conveyance of the property took place on March 20, 2003.  A week after closing, Lipp was informed by the City of St. Petersburg that the property was subject to fines based on the three-page list of code violations.[3]

            In the proceedings below, after filing an answer to the complaint, Buidens moved for summary judgment asserting that she owed no fiduciary duty to Lipp, that Lipp had a duty to examine the property, and that Lipp signed the Disclosure Statement listing problems with the property.  This motion was denied by the trial court by order, entered April 21, 2004.  Buidens moved a second time for summary judgment, with the same assertions, which was granted by the trial court on August 26, 2004.  It is from this summary judgment that Lipp brings the present appeal.[4]

            Before this Court, Lipp argues that the trial court improperly granted summary judgment for Buidens as there is no basis in the law to hold Buidens harmless for her acts and omissions as a realtor representing the seller of property without making full disclosure of material information adversely affecting the value of the property.  Lipp also argues that summary judgment was erroneous as there were disputed issues of material fact, including whether Buidens had actual knowledge of adverse information affecting the value of the property and the adequacy of disclosure by Buidens of such information.  Buidens responds that Lipp was made aware of the code violations via the Disclosure Statement, but did not have a home inspection conducted nor request records from the City regarding code violations.

            The Court finds that summary judgment must be reversed.  Florida law is clear that a seller has a duty of disclosure to the buyer of “facts materially affecting the value of the property which are not readily observable and are not known to the buyer.”  See Johnson v. Davis, 480 So.2d 625, 629 (Fla. 1985)(emphasis added).  This duty of disclosure extends to the seller’s real estate broker.  See Syvrud v. Today Real Estate, Inc., 858 So.2d 1125, 1129 (Fla. 2d DCA 2003).    

            The Court finds that, at a minimum, a factual dispute remains as to Buidens’ knowledge of information adversely affecting the value of the property and the adequacy of the disclosure of such adverse information, specifically the 14 cited code violations.  See Hervey v. Alfonso, 650 So.2d 644, 646 (Fla. 2d DCA 1995)(emphasizing that “if the record reflects the existence of any genuine issue of material fact or the possibility of any issue, or if the record raises even the slightest doubt that an issue might exist, that doubt must be resolved against the moving party and summary judgment must be denied”). 

In remanding this matter, the Court recognizes that some of the cited code violations may have been readily observable by Lipp or may not adversely affect the value of the property.  These are fact issues that the trial court must resolve. 

Therefore, it is,

           

 

 

ORDERED AND ADJUDGED that the Order Granting Summary Judgment for Defendant Buidens is reversed and this cause remanded for action consistent with this Order and Opinion.

            DONE AND ORDERED in Chambers, at St. Petersburg, Pinellas County, Florida this ______ of November 2005.

 

 

 

                                                ______________________________

                                                DAVID A. DEMERS

                                                Circuit Judge, Appellate Division

 

 

 

 

 

 

_____________________________                          _____________________________

PETER RAMSBERGER                                          ANTHONY RONDOLINO

Circuit Judge, Appellate Division                                   Circuit Judge, Appellate Division

 

 

 

 

 

Copies furnished to:

 

Judge Walt Logan

 

Tonu Toomepuu, Esquire

John M. Herbst, Esquire

641 First Street South

St. Petersburg, FL  33701

 

Robert W. Hitchens, Esquire                                                    

6464 First Avenue North

St. Petersburg, FL  33710

 


[1] Neither party disputes that this order is final for purposes of appeal.

 

 

[2] The code violations included:  floor in bathroom peeling up; wiring in closet exposed; refrigerator and range not plugged in; door to storage area has rotten wood and not sealed; ceiling in living room has gaps; hole in wall under the sink; kitchen plumbing not to code; kitchen in disrepair; certificate of inspection required; kitchen floor missing tile and grout; after-the-fact permits required for work completed, and;

garage apartment must be removed.

[3] The record is silent as to what action has been taken by the City against Lipp.  Lipp states in her answers to interrogatories that she expended $ 314.00 to correct one item on this list.

[4] The Court notes that summary judgment in favor of Nelson was entered on August 16, 2004.  This order was not appealed and has no bearing on the issues raised in this appeal.