Cummings v. Carroll
| Decision Date | 03 March 2020 |
| Docket Number | No. COA19-283,COA19-283 |
| Citation | 841 S.E.2d 555 |
| Court | North Carolina Court of Appeals |
| Parties | James CUMMINGS and wife, Connie Cummings, Plaintiffs, v. Robert Patton CARROLL; DHR Sales Corp. d/b/a Re/Max Community Brokers ; David H. Roos; Margaret N. Singer; Berkeley Investors, LLC ; Kim Berkeley T. Durham; George C. Bell ; Thornley Holdings, LLC ; Brooke Elizabeth Rudd-Gaglie f/k/a Brooke Elizabeth Rudd; Margaret Rudd & Associates, Inc. and James C. Goodman, Defendants. |
Chleborowicz Law Firm, PLLC, by Christopher A. Chleborowicz, Wilmington and Elijah A.T. Huston, for Plaintiffs-Appellants.
Ward and Smith, P.A., by Ryal W. Tayloe, Wilmington and Alex C. Dale, for Defendants-Appellees Berkeley Investors, LLC, and George C. Bell.
Crossley McIntosh Collier Hanley & Edes, PLLC, Wilmington, by Clay Allen Collier, for Defendants-Appellees Robert Patton Carroll and DHR Sales Corp. d/b/a Re/Max Community Brokers.
Wallace, Morris, Barwick, Landis & Stroud, P.A., Wilson, by Stuart L. Stroud and Kimberly Connor Benton, for Defendants-Appellees Brooke Elizabeth Rudd-Gaglie f/k/a Brooke Elizabeth Rudd, Margaret Rudd & Associates, Inc., and James C. Goodman.
Plaintiffs James and Connie Cummings appeal from the trial court’s 31 July 2018 order granting summary judgment to Defendants Berkeley Investors, LLC, George C. Bell, Robert Patton Carroll, DHR Sales Corp. d/b/a Re/Max Community Brokers, Brooke Elizabeth Rudd-Gaglie f/k/a Brooke Elizabeth Rudd, Margaret Rudd & Associates, Inc., and James C. Goodman (collectively, "Defendants"1 ). Plaintiffs contend that material issues of fact exist that preclude summary judgment. We affirm in part and reverse and remand in part.
In August 2014, Plaintiffs purchased a house located on Oak Island (the "House") from Berkeley Investors, LLC ("Berkeley"). Plaintiffs were represented in the transaction by Margaret Rudd & Associates, Inc., (the "Rudd Agency"), and the Rudd Agency’s agents Brooke Rudd-Gaglie and James Goodman. Berkeley was represented in the transaction by DHR Sales Corp. d/b/a Re/Max Community Brokers ("Re/Max") and Robert Carroll, Re/Max’s agent in charge of listing the House. At all times relevant to this litigation, George Bell owned a fifty-percent interest in Berkeley, and Thornley Holdings, LLC, an entity owned by Kim Durham, owned the other fifty-percent interest.
The House was constructed in 2003. Berkeley purchased the House in 2005, intending to use it as a rental property. Over the course of its ownership of the House, Berkeley employed Oak Island Accommodations, Inc., ("OIA") to manage the House’s rental, cleaning, and maintenance. OIA records demonstrate that over the course of Berkeley’s ownership of the House, there were various reports about problems at the House requiring maintenance including, inter alia , damage to the roof, windows which would not close, various internal leaks, mold and other "foreign substances" growing within, and pests.
Berkeley first hired Carroll to list the House for sale in January 2013. On 14 January 2013 (Durham’s signature) and 20 January 2013 (Bell’s signature), Berkeley executed a State of North Carolina Residential Property and Owners’ Association Disclosure Statement (the "Disclosure Statement"), which owners of certain residential real estate are required to provide to prospective purchasers in connection with a contemplated sale pursuant to N.C. Gen. Stat. § 47E. In the Disclosure Statement, Berkeley (through Durham and Bell) marked "No" in response to the following questions:
The "Instructions to Property Owners" section of the Disclosure Statement sets forth that marking "No" on the form is a representation that the signatory has "no actual knowledge of any problem" regarding the relevant characteristic or condition at the time of signing. The instructions also charged Berkeley that if "something happens to the property to make your Disclosure Statement incorrect or inaccurate (for example, the roof begins to leak), you must promptly give the purchaser a corrected Disclosure Statement or correct the problem."
Evidence in the record shows that Bell and Durham discussed various issues with the House during Berkeley’s ownership including, inter alia , mold, various water leaks, and ceiling leaks. Carroll was also party to certain of these communications, including a 14 October 2013 email regarding issues with the House between Carroll, Bell, and Durham, among others, in which Bell said they needed to "trace the source of the water leakage evident on the ceiling" and and that he had "[f]ound a small plumbing leak in the kitchen" which he had "fixed with tape."
On 20 January 2014, Bell sent Durham an email noting that they needed to: (1) paint the exterior walls and the trim around the doors, as "the wooden trim around the doors is in real danger of beginning to rot"; (2) paint the "living area on the lower level" because ; and (3) OIA records from 13 February 2014 entitled "Work for Owner" indicate that OIA was seeking estimates to repair these issues, and indicated on 25 March 2014: "Owner is having this work completed by another vendor."
Carroll hired a painter named Randy Cribb to paint the house at some point in March 2014. In addition to painting a wall, the upper and lower decks, and the living room, the work Cribb bid included repairing "cracks" and "cracked caulk" in the living room ceiling. The record contains a screenshot of text messages exchanged between Carroll and Cribb at an unspecified date prior to 24 March 2014 in which Cribb said In his deposition, Cribb testified that he did not look behind any walls to check for sources of water intrusion.
The Rudd Agency began representing Plaintiffs in their efforts to purchase the House on 26 June 2014, when Rudd-Gaglie (on the agency’s behalf) and Plaintiffs executed an Exclusive Buyer Agency Agreement. That agreement set forth, inter alia , that: (1) the Rudd Agency had the duty of "disclosing to [Plaintiffs] all material facts related to the property or concerning the transaction of which [the Rudd Agency] has actual knowledge"; (2) Plaintiffs "[are] advised to seek other professional advice in matters of ... surveying, wood-destroying insect infestation, structural soundness, engineering, and other matters pertaining to any proposed transaction"; and (3) while the Rudd Agency "may provide [Plaintiffs] the names of providers who claim to perform such services, [Plaintiffs] understand[ ] that [the Rudd Agency] cannot guarantee the quality of service or level of expertise of any such provider." The Exclusive Buyer Agency Agreement also provided that Plaintiffs agreed to "indemnify and hold [ ] harmless" the Rudd Agency (and its agents Rudd-Gaglie and Goodman) for any liability it might incur arising "either as a result of [Plaintiffs’] selection and use of any such provider or [Plaintiffs’] election not to have one or more of such services performed."
Berkeley accepted Plaintiffs’ offer to purchase the House for $1.25 million on 12 (Plaintiffs’ and Bell’s signatures) and 13 July 2014 (Durham’s signature). The Offer to Purchase and Contract (the "Contract") contemplated a 30-day due diligence period allowing Plaintiffs and their agents "to conduct all desired tests, surveys, appraisals, investigations, examinations and inspections of the Property as [Plaintiffs] deem[ ] appropriate," without limitation, and expressly contemplated that Plaintiffs were allowed to conduct "[i]nspections to determine ... the presence of ... evidence of excessive moisture adversely affecting any improvements on the Property" or "evidence of wood-destroying insects or damage therefrom[.]" The Contract also: (1) included an acknowledgment by Plaintiffs that they had received the Disclosure Statement (which, as mentioned above, Berkeley had executed in January 2013); (2) included an acknowledgement by Plaintiffs that "THE PROPERTY IS BEING SOLD IN ITS CURRENT CONDITION"; and (3) set forth that Berkeley was not providing Plaintiffs any warranty to Plaintiffs in connection with the sale.
Plaintiffs hired Jeff Williams, a licensed home inspector, to conduct an inspection of the House on 19 July 2014, which Carroll, Rudd-Gaglie, and Goodman also attended. In the inspection report he provided to Rudd-Gaglie (to be provided to Plaintiffs), Williams set forth the scope of his inspection, including that he "shall[,]" inter alia : (1) "[r]eport signs of abnormal or harmful water penetration into the building or signs of abnormal or harmful condensation on building components"; and (2) "[p]robe...
To continue reading
Request your trial
-
Cummings v. Carroll
...to plaintiffs’ claims for negligent misrepresentation and fraud against Berkeley Investors and Mr. Bell. Cummings v. Carroll , 270 N.C. App. 204, 235, 841 S.E.2d 555 (2020). Finally, although a majority of the Court of Appeals voted to reverse the trial court's decision to grant summary jud......
-
Contaminant Control, Inc. v. Allison Holdings, LLC
...claims, even where the alleged fraud also breaches a contractual term between the parties." Cummings v. Carroll, 270 N.C.App. 204, 231, 841 S.E.2d 555, 574 (2020) (citing Bradley Woodcraft, Inc. v. Bodden, 251 N.C.App. 27, 34, 795 S.E.2d 253, 259 (2016)). Assuming Defendant's second Fraud C......
-
Pike v. Wells Fargo Bank, N.A.
...to investigate or that he could not have learned the true facts by exercise of reasonable diligence." Cummings v. Carroll, 270 N.C. App. 204, 221, 841 S.E.2d 555, 568, review allowed, 376 N.C. 525, 851 S.E.2d 42 (2020) (citation omitted). During the course of an ordinary debtor-creditor rel......
-
Staffing Advantage LLC v. Definitive Staffing Sols., Inc.
...resulting from the alleged breach is not an element of a breach-of-contract claim that must be pleaded. See Cummings v. Carroll, 270 N.C. App. 204, 227, 841 S.E.2d 555, 572 (2020) ("The elements of a claim for breach of contract are (1) existence of a valid contract and (2) breach of the te......