Bethlahmy v. Bechtel

• Decision Date: 14 June 1966
• Docket Number: No. 9681,9681
• Citation: 91 Idaho 55,415 P.2d 698
• Parties: Nedavia BETHLAHMY and Evelyn F. Bethlahmy, husband and wife, Plaintiffs-Appellants, v. Everett BECHTEL and A. L. Modin dba Modin Realty & Insurance Co., Defendants-Respondents.
• Court: Idaho Supreme Court

Page 698

415 P.2d 698

91 Idaho 55

Nedavia BETHLAHMY and Evelyn F. Bethlahmy, husband and wife, Plaintiffs-Appellants, v. Everett BECHTEL and A. L. Modin dba Modin Realty & Insurance Co., Defendants-Respondents.

No. 9681.

Supreme Court of Idaho.

June 14, 1966.

Coughlan & Imhoff, Boise, for appellants.

C. Ben Martin, Boise, for respondent Bechtel.

Davison, Davison & Copple, Boise, for respondent Modin.

TAYLOR, Justice.

April 12, 1963, plaintiffs (appellants) who were desirous of purchasing a home, met with one Roper, a salesman for A. L. Modin, dba Modin Realty & Insurance Company. Roper showed them a splitlevel home in Boise which was in course of construction by defendant (respondent) Bechtel. On the same day plaintiffs visited the house a second time in the company of Roper and Bechtel. Bechtel told plaintiffs the houses he built were the finest, that this house was of first quality construction, and assured them it would be completed and ready for occupancy on May 15th, following. Roper informed plaintiffs the house was outside the city limits of Boise and for that reason taxes would be low, but he also advised them it was entirely possible that Boise would extend the city limits to include this property in the near future. Neither Bechtel nor Roper at any time advised plaintiffs that there existed a covenant running with the land which limited occupancy to members of the Caucasian race.

Following the second visit to the property, plaintiffs entered into a contract for its purchase from defendant Bechtel, and moved into the house the following May 17th, although it had not been completely finished at that time. Construction was thereafter substantially completed and defects discovered by plaintiffs were generally remedied. About the middle of July plaintiffs discovered the covenant limiting occupancy to persons of the Caucasian race, and although the plaintiff husband testified he would not have purchased the house had he known of the restriction, plaintiffs were apparently satisfied when assured that the restriction was void and unenforceable. About the same time plaintiffs also discovered the property was located within the Boise city limits prior to its purchase by them. The representation by Roper that the house was outside the city limits was not actionably fraudulent for the reason that it was accompanied by the advice that it would likely be annexed to the city; also, the finding by the trial court that the representation was not material because plaintiffs would have purchased the property had they been advised that it was located within the city limits, was supported by the evidence. The judgment of dismissal in favor of Modin was proper.

Prior to construction of the house an open irrigation ditch crossed the lot from east to west. This ditch defendant Bechtel buried beneath the surface of the lot by means of a conduit laid in a trench dug along the course of the ditch and covered over with earth. This buried water conduit consisted of ten-inch drainage tile, in three foot sections butted together without any water seal in the joints. The house was then constructed in such location that this water conduit ran through under the concrete floor of the attached garage. The garage was attached to the north end or side of the house. The tiled water line was seven to nine feet north of the north wall of the house, and approximately two to three feet in elevation above the level of the floor of the adjacent basement rooms. Plaintiffs were not informed of the existence of this underground water conduit.

Defendant Bechtel testified the outside of the basement walls were mopped with tar, and Hydroseal was used on the snap tie holes; that the eight-inch basement walls and the four-inch (actually 3 1/2 ) basement floor slab were constructed of standard concrete five-sack-mix (which did not purport to be waterproof); that the concrete floor slab was laid on top of the foundation footings witnout any water seal in the joint between the footings, the walls, and the floor slab; and that, except for the use of tar and Hydroseal, as stated, no effort was made to make the basement waterproof.

In July, 1963, after the irrigation season had commenced, water seeped in around the edges of the basement rooms and spread over a considerable portion of the tiled floors. It was defendant's opinion that this water came from the tiled ditch underneath the garage. Holes drilled or broken through the garage floor next to the north wall of the dwelling house revealed that the soil thereunder had settled away from the floor three to four inches according to defendant, and up to twelve inches according to plaintiff, and was 'wet' or 'saturated.' A crack developed in the garage floor near and parallel to the wall of the house.

When notified of the seepage, defendant rerouted the buried ditch from where it entered the lot at the east linc, along the inside of the east line to the northeast corner, then west along the north line, and south along the west line to the point where the original ditch entered the culvert under Lenora street. Defendant testified he sealed the joints in the drainage tile used in this rerouting, but whether the tile itself was waterproof does not appear.

Water continued to seep into the basement rooms. Defendant then dug trenches in the back yard across and at a rightangle to the course of the original ditch. The second trench was extended downward through the hardpan and backfilled with gravel. He also dug holes on the outside of the foundation at points where water appeared to be coming into the house. These trenches and holes did not reveal the source of the water or prevent its continued flow. Water did not appear in these trenches or holes, although the soil in the sides and bottoms was moist. The failure to find water in these excavations, explains the testimony of some of the witnesses that they were 'dry.'

September 25, and November 24, 1963, plaintiffs gave notice of rescission of their contract, and tendered possession of the property ot Bechtel. Upon Bechtel's refusal of rescission, plaintiffs brought this action against Bechtel and Modin. The record does not support the judgment in favor of Bechtel.

Keith E. Anderson, a hydrologist, basing his opinion upon an examination of the premises and a hypothetical statement of the facts, testified that in his opinion the water originally came from the covered tile under the garage floor; that water thereafter probably came from a 'perched' water table established by irrigation water accumulating above a hardpan; that the water appearing in the basement rooms probably came through the joint between the foundation wall and the basement floor slab; and that the concrete in the basement walls and floor, and the joint between, could have been made waterproof by proper mixture and care in construction.

None of defendant's efforts to stop the seepage of water into the basement was successful, and the seepage continued from the middle of July to the forepart of November. During all this time plaintiffs tried to keep the water off the basement floor by means of towels and other fabrics laid along the edges of the rooms, and by mopping up the water with towels, wringing it into buckets and carrying it out of the house. Defendant frequently visited at the house during that time and at times assisted in mopping up the water. Some bugs or inseets appeared on the basement floors with the water. Plaintiffs placed bricks under the legs of the furniture in an effort ot prevent damage thereto. As time went on an offensive odor pervaded the basement rooms. Plaintiffs' son and daughter were forced to move upstairs from the bedrooms which they had occupied in the basement. Some of the tiling on the floors and the mopboards were loosened by the water. Finally, about November 1st, plaintiffs moved out of the house because of the water which was still seeping into the basement rooms when they left the premises.

In rebuttal, defendant testified that in December, 1963, and at time of trial in June, 1964, he peered through the windows of the vacated house and saw no water on the basement floors. In rebuttal plaintiff testified that on vacating the house the basement floors and baseboards had been thoroughly cleaned; and that at the time of trial he inspected the basement and found water stains, bugs and 'black gook coming in from the floor tiles.' This indicated water had seeped in after the house was vacated. The opinion of the hydrologist, and the testimony of the other witnesses that the seepage began with, and continued throughout, the 1963 irrigation season indicated that the seepage would occur during each successive irrigation season. Defendant does not assert that he did anything after the seepage began, to waterproof the basement.

Plaintiffs commenced this action for rescission and restitution, mainly on the ground of defendants' failure to disclose the defective condition of the house. The presence of the unsealed irrigation ditch through the lot and beneath the garage, coupled with the fact that the basement was not of waterproof construction, constituted major defects, known to defendants, and unknown to plaintiffs, and not discoverable upon reasonable inspection. Failure to disclose such defects would support a finding of fraud. Obde v. Schlemeyer, 56 Wash.2d 449, 353 P.2d 672 (1960).

In the tentative draft of the Restatement of the Law Second, Torts, considered by The American Law Institute at its annual meeting in May, 1966, § 551(1) is presented as follows:

'(1) One who fails to disclose to another a thing which he knows may justifiably induce the other to act or refrain from acting in a business transaction is subject to the same liability to the other as though he had represented the nonexistence of the matter which he has failed to disclose, if, but only if, he is under a duty to the other to exercise reasonable care to disclose the...