Banner v. Hockessin Chase, L.P.

Decision Date12 May 2022
Docket NumberC. A. N21C-06-235 JRJ
PartiesVAN J. BANNER Plaintiff, v. HOCKESSIN CHASE, L.P.; TOLL BROTHERS, INC.; WENDY JO STURTZ; and WILLIAM I. WOLFF Defendants.
CourtSuperior Court of Delaware

Date Submitted: February 11, 2022

Upon Defendants Hockessin Chase, L.P. and Toll Brothers, Inc., and Wendy Jo Sturtz and William I. Wolff's Motions to Dismiss: GRANTED.

Douglas J. Cummings, Jr., Esquire, of Kollias Law, LLC Attorney for Plaintiff Van J. Banner.

Anthony N. Delcollo, Esquire, of Offit Kurman, P.A., Attorney for Defendants Hockessin Chase, L.P. and Toll Brothers, Inc.

Donald L. Gouge, Jr., Esquire, of Donald L. Gouge, Jr., LLC Attorney for Defendants Wendy Jo Sturtz and William I. Wolff.

MEMORANDUM OPINION

Jan R. Jurden, President Judge

I. INTRODUCTION

Before the Court are Motions to Dismiss submitted by Defendants Hockessin Chase, L.P. and Toll Brothers, Inc. ("Developer Defendants"), Wendy Jo Sturtz ("Sturtz") and William I. Wolff ("Wolff") (collectively the "Defendants"). Defendants assert the Court should dismiss the Complaint because the statute of limitations expired before Plaintiff filed his Complaint. Plaintiff argues the Complaint was timely filed because the statute of limitations did not begin to run until June 27, 2018 - when Plaintiff received correspondence from Toll Brothers rejecting his warranty claim.

Applying Superior Court Civil Rule 12(b)(6), the Court finds that that the statute of limitations began to run by no later than April 6, 2016, and that Plaintiff was on inquiry notice of the claims on or before that date. Assuming arguendo that the Plaintiff was not on inquiry notice in April 2016, the Court finds he was on inquiry notice as of May 2, 2018, the date he submitted a warranty claim to Toll Brothers. The Court finds Plaintiff's Complaint filed on June 24, 2021 is time-barred, and therefore, Defendants' Motions to Dismiss are GRANTED.

II. BACKGROUND

On March 17, 2006, Sturtz purchased a home at 43 Waterton Drive, Bear, Delaware (the "Property") from the Developer Defendants.[1] At that time, the Developer Defendants provided the homeowner a ten-year Builder's Limited Warranty for construction defects. After living in the home for almost a decade, Sturtz decided to put the property up for sale. In conjunction with the property listing, on February 22, 2016, Sturtz prepared a Seller's Disclosure of Real Property Condition Report ("Seller's Disclosure").[2] The Seller's Disclosure informed prospective buyers of the Sturtz's understanding of the then-present condition of the property.[3]

On or about February 24, 2016, Plaintiff and Sturtz executed an Agreement of Sale for Delaware Residential Property (the "Agreement of Sale").[4] In the Agreement of Sale, Plaintiff was obligated to complete, inter alia, a Residential Home Inspection, which allowed Plaintiff, at his own expense and using a home inspector of his choosing, to notify Sturtz of any identified defects. Sturtz could then either agree to remedy the defects, or refuse to do so.[5] Additionally, the Residential Home Inspection contingency contemplated a stucco inspection. Plaintiff hired an inspector to perform the general home inspection, which was completed March 1, 2016.[6] Plaintiff also hired Expert Home Group to perform a stucco inspection, and on February 29, 2016, Expert Home Group completed the stucco inspection. Expert Home Group then issued a detailed inspection report.

The Expert Home Group Report (the "2016 Report") identified defects in the home's construction, including defects in the stucco facade.[7] The 2016 Report provided a summary checklist, specifically identifying inadequate or defective stucco and caulking.[8] The 2016 Report warned that the stucco thickness on the home was below construction industry standards in effect at the time the home was constructed, and noted "stucco that is thinner than specified may be subject to cracking, delamination, separation from the substrate, and may allow more water penetration through the stucco."[9] Additionally, the 2016 Report informed Plaintiff that caulking was inadequate and/or failing around the windows and doors, caulk was absent around fixtures mounted to the stucco, and joints between stucco and siding, stone, or trim elements were not caulked at all.[10] The absence of properly installed caulk created a risk of additional water damage.[11] The 2016 Report also noted cracks in the stucco, and recommended Plaintiff seal all cracks to prevent water damage.[12] Finally, Expert Home Group explicitly warned Plaintiff that defective stucco issues may be latent and more extensive than those "present at the specific time of inspection."[13]

On March 3, 2016, Reaction Exteriors LLC ("Reaction Exteriors") produced an estimate to repair the issues identified in the 2016 Report. Reaction Exteriors priced the repairs at $6, 234.00, including $1, 924.00 for stucco repair and $3, 445.00 to correct caulk related defects.[14]

On March 12, 2016, just prior to the expiration of the Builder's Limited Warranty, and during Plaintiff's pending purchase of the home, Sturtz submitted a warranty claim to the Developer Defendants.[15] The factual basis, i.e., the alleged damages which Sturtz sought remediation) for Sturtz's warranty claim was the 2016 Report and the Reaction Exteriors repair estimate. Toll Brothers accepted Sturtz's warranty claim.[16] In the April 6, 2016 Settlement and Release, Sturtz and Toll Brothers resolved the pending warranty claim, and Toll Brothers compensated Sturtz for the defects identified in the stucco inspection report commissioned by Plaintiff - - the 2016 Report. Additionally, the Settlement Agreement required Sturtz to make certain disclosures to any future prospective buyer of the home. Specifically, Paragraph 5 of the Settlement Agreement provided:

Owners agree to disclose the fact of the settlement and release of Toll entities, the expiration of the limited warranty, the Conditions, the Inspection Report, and the Warranty request to any future prospective buyer of the Home prior to the time when such buyer agrees to buy the Home directly from the owners or closes on the sale of the Home. Owners further agree to make all disclosures to any real estate brokers or agent(s) representing Owners or potential buyers in connection with Owner's marketing and/or sale of the Home as is required by applicable law.[17]

On April 6, 2016, Plaintiff purchased the home from Sturtz.[18] At closing, Sturtz issued a credit to Plaintiff in the amount of $6, 234.00, payment for the cost of repairs provided in the Reaction Exteriors estimate.[19]

In the spring of 2018, Plaintiff learned that other homes in his same residential development were experiencing defective stucco issues.[20] In fact, one of his neighbors in the Red Lion Chase Development "noticed the visual evidence of stucco failure on [Plaintiff's] home and informed [Plaintiff] that many, many houses in the neighborhood [were] experiencing the same problems."[21] Some neighbors produced the Red Lion Chase Water Infiltration Flyer ("Flyer"), which suggested that homeowners experiencing stucco issues should submit warranty claims to Toll Brothers.[22]

On May 2, 2018, Plaintiff submitted a warranty claim to Toll Brothers.[23] The Warranty Claim form, completed and signed by Plaintiff, identifies the following stucco and structural damages: (1) water damage around the windows; (2) water damage to the chimney; (3) wood rot around the doors; and (4) water damage to the concrete front of the residence.[24] On June 27, 2018, Toll Brothers rejected Plaintiff's claim, informing him that (a) all builder warranties had expired, and (b) on April 6, 2016, Sturtz and Wolff executed Settlement Agreement releasing the Developer Defendants from further liability under the Builder's Limited Warranty.[25] The Settlement Agreement specifically addressed the stucco and construction defects identified in the February 29, 2016 Expert Home Group Inspection Report and the March 3, 2016 Reaction Exteriors repair estimate.[26] In March of 2019, after Toll Brothers rejected Plaintiff's warranty claim, Plaintiff commissioned a second stucco inspection, a Confidential Property Inspection Report (the "2019 Report").[27] Plaintiff obtained the 2019 Report and forwarded it to Reaction Exteriors for an estimated cost of repairs. This time, the Reaction Exteriors estimate valued the cost of repairs at $165, 890.00 for stucco and brick veneer replacement, stucco and structural repairs to the chimney, and comprehensive caulking repairs.[28]

On June 24, 2021, Plaintiff filed the Complaint against Defendants, asserting claims for declaratory judgment, negligent construction, breach of contract, breach of implied covenant of good faith and fair dealing, tortuous interference with contract, and fraud.[29]

III. STANDARD OF REVIEW

When considering a motion to dismiss, the Court "will consider all well-pleaded facts in the complaint and accept them as true."[30] The Court will grant a Rule 12(b)(6) motion to dismiss only when "it appears 'with reasonable certainty that, under any set of facts that could be proven to support the claims asserted, the plaintiff would not be entitled to relief.'"[31] The moving party bears the burden of establishing the aforementioned condition and the Court "must view all inferences drawn from the facts plead in the light most favorable to the plaintiff."[32] In deciding the motion, the Court can also consider documents incorporated into the complaint which are integral to the plaintiff's claim.[33]

IV. PLAINTIFF'S CLAIMS

Plaintiff's Complaint asserts seven claims. Count I of Plaintiff's Complaint is a claim for declaratory judgment. Plaintiff argues that the April 6, 2016 Settlement...

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