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.