Davis v. Charles John Tuma, Donald J. Mccanlies, Johnson House Co.
| Decision Date | 07 August 2020 |
| Docket Number | Docket No. 46721 |
| Court | Idaho Supreme Court |
| Parties | Jefri R. DAVIS and Debbie S. Davis, husband and wife, Plaintiffs-Appellants, v. Charles John TUMA, Donald J. McCanlies, Johnson House Company dba Coldwell Banker Resort Realty, Defendants-Respondents. |
Arthur M. Bistline, Bistline Law, PLLC, Coeur d'Alene, for appellants.
Daniel Toby, McLaughlin, Berg, McLaughlin & Nelson, Chtd., Sandpoint, for respondents.
This case arises from a 2009 purchase of real property located in rural Boundary County by Jefri and Debbie Davis (the Davises). While living in California, the Davises sought to purchase a home in northern Idaho, and hired Charles Tuma (Tuma) and Tuma's broker, Donald McCanlies (McCanlies), to help them in that endeavor. Tuma and McCanlies both worked for Johnson House Company, which in turn was doing business as Coldwell Banker Resort Realty. Some years after purchasing the property in question, the Davises learned to their distress that the road they believed provided access to their home, did not in fact do so. The Davises filed suit against Tuma, McCanlies, and Coldwell Banker Resort Realty (collectively, the Defendants), alleging fraud and constructive fraud. The Defendants moved for summary judgment against the Davises. The Davises responded, filing several declarations, portions of which the Defendants moved to strike. The Davises also sought to amend their complaint to add claims for unlicensed practice of law, surveying, or abstracting; and breach of contract and violation of contractual duties. The district court granted the Defendants' motions for summary judgment and to strike, but did not specifically identify which statements were being stricken. The district court also denied the Davises' motion to amend their complaint without explanation of the reasoning behind the decision.
This timely appeal followed. For the reasons set out below, we reverse the district court's order granting the Defendants' motion for summary judgment, and vacate the district court's order denying the motion to amend. We also vacate the judgment entered and remand the case for further proceedings.
In 2009, the Davises were living in California. In August of that year, the Davises contacted Tuma to inquire about purchasing real property in northern Idaho. Tuma was a real estate agent licensed in Idaho, working with his broker, McCanlies. The Davises told Tuma they were interested in a house and lot in Movie Springs, Idaho, located at 984 Gray Wolf Road (the Property).
According to the Davises, the family informed Tuma of their specific needs for the property they sought. In particular, the Davises contend they told Tuma that Debbie Davis was in poor health and needed a smooth access road to the property because of her severe degenerative disc disease
and multiple sclerosis.
As requested, Tuma evaluated the Property and provided a video of his site visit. Tuma used Gray Wolf Road to access the Property. Gray Wolf Road is an unpaved, gently sloping road that begins at U.S. Highway 2, and provides access to the surrounding properties before it terminates at the Property. According to Tuma, he believed (incorrectly, as it turns out) that Gray Wolf Road provided legal access to the Property.
On September 14, 2009, the Davises executed the RE-14 Buyer Representation Agreement (the Agreement). On September 17, 2009, the Davises signed the RE-21 Real Estate Purchase and Sale Agreement (REPSA). Following the signing of the REPSA, Tuma reviewed the Preliminary Title Commitment (PTC) with the Davises. Tuma also personally reviewed the Declaration of Restrictive Covenants (DRC), as well as a second survey of record showing a boundary line adjustment (Boundary Line Survey) on the northern boundary of the Property. According to Tuma, in his review of the PTC, DRC, and Boundary Line Survey, he did not notice or appreciate that the only legal access to the Property was through an easement from Highway 2, and not via Gray Wolf Road. The Property's legal access is at the bottom of a steep hill which must be traversed in order to get to the home situated on the Property. During many months, the legal access to the home is extremely challenging.
The Davises purchased the Property without visiting it, acquiring it by warranty deed on October 1, 2009. Members of the Davis family subsequently resided on the Property shortly after they purchased it. They accessed the Property continuously thereafter via Gray Wolf Road.
On December 7, 2009, two months after closing, the closing agent, Jessica Fairchild (Fairchild) of Community Title, LLC, sent an email to the Davises and Tuma, attaching the Boundary Line Survey to the email. That same day, Tuma sent an email to the Davises with the aerial photograph attached. On December 8, 2009, Tuma emailed the Davises again, asking for confirmation "that everything came [through] to you ok when you get a chance?"
According to Terah Davis (Terah), Jefri and Debbie's daughter, she attempted to access the attachments to the emails, but did not recall exactly when. In her declaration, Terah stated that she remembered opening the aerial photograph attachment, "thinking it was a neat image, but otherwise having no idea what the emails were or why they were being sent." According to Terah, when she attempted to open the Boundary Line Survey attachment, the Terah stated that the computer "never worked properly after that day" and that the family "ended up throwing it away shortly after[.]" According to Terah, she "did not download that attachment again on [the] new computer" because she had been advised against doing so.
In July 2016, nearly seven years after the Davises had moved to Idaho and continuously resided on the Property, they received a letter advising them to cease and desist their use of Gray Wolf Road. The letter was from an attorney representing the adjacent property owners, Scott and Maria Gray (the Grays). The letter stated that the Davises did not have legal access to the Property via Gray Wolf Road. The letter stated that according to the Record of Survey, Gray Wolf Road was an access and utility easement which terminated at the northernmost point of the Grays' property. The letter gave the Davises thirty days to develop another means of access to their property. On August 29, 2016, the Grays physically blocked Gray Wolf Road, thereby precluding the Davises from accessing the Property in the manner they had during the entire time they had lived in Idaho.
According to the Davises, Debbie's health problems have forced her to stay in the house on the Property because she cannot physically endure travel down the only legal access to their property. The Davises contend that Debbie has only left the Property once since the Grays blocked Gray Wolf Road.
The Davises filed suit against Tuma, McCanlies, and Coldwell Banker Resort Realty on May 10, 2018, alleging fraud and constructive fraud. In particular, the Davises alleged that Tuma engaged in fraud when he "intentionally and deceitfully misrepresented his capacities" to identify access routes to properties and to review the PTC, and "deliberately and intentionally lied and deceived the Davises when he willfully and falsely stated that he had reviewed the PTC and [DRC] and determined the Davises had nothing to be concerned about." Alternatively, the Davises contended that at the very least Tuma had engaged in constructive fraud by failing to identify the Property's access problems and appropriately reviewing the PTC and DRC.
On June 5, 2018, the Defendants answered the complaint. The Defendants asserted multiple affirmative defenses. The Defendants contended that by alleging negligent misrepresentation, the Davises were pleading a cause of action not recognized under Idaho law except in the narrow confines of a professional relationship involving an accountant. The Defendants also asserted that the Davises' claims for fraud and constructive fraud were barred by the applicable statute of limitations under Idaho Code section 5-218, which (according to the Defendants) expired three years after the Davises purchased the Property.
On October 1, 2018, the Defendants moved for summary judgment. The motion was supported by declarations from Tuma and the Defendants' counsel, as well as discovery responses provided by the Davises. The Defendants argued that the Davises' claims of fraud and constructive fraud were governed by a three-year statute of limitations, which had run by late 2012 because the Davises had (1) constructive notice of the legal access to the Property at the purchase date, October 1, 2009; and (2) actual notice when they received the Boundary Line Survey on December 7, 2009.
On November 23, 2018, the Davises filed a memorandum in opposition to summary judgment, along with declarations from Debbie, Terah, and Jefri Davis.1 In their declarations, the Davises contended that there were material omissions in Tuma's explanation of his review of the PTC, DRC, and Boundary Line Survey. The Davises argued that they had established the required elements of constructive fraud because Tuma's representations had been made in "ignorance of [the statements'] truth[,]" and because Tuma "was professionally bound to provide a high level of care[,]" and had "convinced the Davises that he had exercised care in all elements of the transaction for which he took a part." The Davises also asserted that their constructive fraud claim only required establishing that they were in a relationship of trust and confidence with the Defendants. In addressing the Defendants' statute of limitations argument, the Davises contended that they "never viewed the survey attachment" that had been emailed to them. Relying on Large v. Cafferty Realty, Inc., 123 Idaho 676, 851 P.2d 972 (199...
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Davis v. Tuma
...167 Idaho 267469 P.3d 595Jefri R. DAVIS and Debbie S. Davis, husband and wife, Plaintiffs-Appellants,v.Charles John TUMA, Donald J. McCanlies, Johnson House Company dba Coldwell Banker Resort Realty, Defendants-Respondents.Docket No. 46721Supreme Court of Idaho, Boise, April 2020 Term.Opini......