Duncan v. Savannah, LLC
| Decision Date | 23 November 2021 |
| Docket Number | No. ED 109582,ED 109582 |
| Citation | 637 S.W.3d 633 |
| Parties | Thomas DUNCAN and Lisa Duncan, Appellants, v. SAVANNAH, LLC d/b/a Berkshire Hathaway Home Services, et al., Respondents. |
| Court | Missouri Court of Appeals |
Michael K. Daming, Evelyn I. Sims, 1401 S. Brentwood Blvd, Ste. 875, St. Louis, MO 63144, for appellants.
John P. Rahoy, Teresa M. Young, 800 Market Street, Ste. 1100, St. Louis, MO 63101, for respondents.
Ronald J. Wuebbeling, 4838 Greenburg Drive, St. Charles, MO 63304, for defendants.
Thomas Duncan and Lisa Duncan (Buyers) appeal the trial court's summary judgment in favor of Savannah, LLC d/b/a Berkshire Hathaway Home Services (Berkshire Hathaway) and Teresa Wernimont (Wernimont) (collectively, Respondents) on their claims for a violation of the Missouri Merchandising Practice Act (MMPA) and negligent misrepresentation regarding statements Wernimont made and alleged omissions of material fact during the purchase of Buyers’ home (the Property). Because we find genuine issues of material fact exist regarding whether Wernimont omitted material facts or is liable for false information provided by Sellers regarding water drainage issues on the Property, we reverse.
Buyers purchased the Property, a residential home in St. Peters, Missouri, from Craig Nute (Nute) and Cathleen Nute (collectively, Sellers) on April 7, 2017. Wernimont acted as the listing agent for Sellers and as an agent of Berkshire Hathaway, Wernimont's real estate broker.1 Prior to the sale, in her role as Sellers’ agent, Wernimont created a listing for the Property on the Multiple Listing Service for real estate agents (MLS), which stated that "every detail ha[d] been addressed" and that the Property was "meticulously maintained." Additionally, Sellers prepared a seller's disclosure statement regarding the Property, which Wernimont reviewed and then forwarded to Buyers. As relevant here, Sellers answered "no" to the following questions in the sellers’ disclosure statement:
After Buyers took possession of the Property, Buyers alleged they immediately experienced several problems including water in the basement, sump pump backups, foundation problems, mold, grading and water drainage problems, and leaking from the pool. In November of 2017, Buyers filed suit against Sellers and Respondents, alleging that all parties made misrepresentations or omitted material facts regarding several aspects of the Property. Buyers filed an amended petition in March of 2020, asserting claims of breach of contract against Sellers, and claims of negligent misrepresentation and violations of the MMPA against both Sellers and Respondents. Respondents moved for summary judgment, arguing that Respondents were unaware of any alleged problems with the Property and could not be held liable for misrepresentations or omissions in the seller's disclosure statement. As relevant here, the parties submitted the following evidence to the trial court during summary judgment proceedings.
Prior to the sale of the Property, Kenny Etling (Etling), who had previously performed maintenance on the pool at the Property, performed an inspection of the pool in March of 2017, at which Buyers and Sellers were both present. Buyers had requested their own inspector, who appeared at the Property the day before Etling's inspection, but Nute would not allow Buyers’ inspector to perform an inspection because Nute did not want someone he was not familiar with to open the pool during the colder months and potentially cause damage to the pool. Buyers eventually agreed that Etling could perform the inspection. Buyers inquired about the liner of the pool, which was nine or ten years old at that point, and Etling said that it would be good for another two or three years. Etling also verified that the pump, heater, fountains, slide, and skimmer were all in good working order. Etling concluded, "There's nothing wrong with this pool at all."
On April 1, 2017, six days before the sale of the Property, Joseph Denness (Denness), who owns a house next to the Property, contacted Wernimont by telephone. Denness memorialized this conversation in a letter dated April 3, 2017.2 Denness noted he had spoken to Wernimont about water runoff that had occurred "over the past several years" from Nute's yard into Denness’ back yard and onto the side of Denness’ home, as well as "a constant run of water" over Denness’ driveway that had occurred the previous summer. Denness added that when he brought the issue of water running over his driveway to Nute's attention, Nute dug a trench and installed a drainage pipe to the street. Denness further stated that water ran out of the pipe "most of the summer and ceased when the pool was shut down." Denness stated Nute told him the water was coming from Nute's sump pump and was not associated with the pool, but Denness did not observe water running through the winter or during rainy weather. Denness added that he had not experienced any groundwater issues at his home, which was below the Property. Denness wanted to ensure that the new owners of the Property would address any ongoing issues.
Wernimont testified by deposition that after she spoke with Denness, she went to the Property and discussed Denness’ concerns with Nute. Nute pulled up the cover of the pool, and Wernimont observed water in the pool, which led Wernimont to conclude the pool was not leaking. Nute also told Wernimont there were no issues with the pool and that the issue was drainage from Nute's sump pump. Wernimont took Denness’ letter to her broker at Berkshire Hathaway, and her broker told her not to respond to the letter. Wernimont did not disclose the letter to Buyers or Buyers’ agent.
The trial court granted summary judgment in favor of Respondents, finding that Wernimont, as agent for Berkshire Hathaway, did not make a misrepresentation or fail to disclose any material fact because Denness’ letter contained only speculation and non-expert opinion that the pool on the Property was leaking. The trial court further found that Respondents took proper measures to ensure that the pool was not the source of the water leakage. This appeal follows.
Because the propriety of summary judgment is purely an issue of law, our review of summary judgment is essentially de novo. State ex rel. Nixon v. Peterson, 253 S.W.3d 77, 84 (Mo. banc 2008) (citing ITT Commercial Fin. Corp. v. Mid-Am. Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993) ). We review the record in the light most favorable to the non-moving party and accord such party the benefit of all reasonable inferences from the record. Id.
Summary judgment is appropriate where the material facts are not in dispute and the moving party establishes a right to judgment as a matter of law. Mo. R. Civ. P. 74.04(c)(6) (2021). A defending party moving for summary judgment "need not controvert each element of the non-movant's claim in order to establish a right to summary judgment." Joseph H. Held & Assocs., Inc. v. Wolff, 39 S.W.3d 59, 62 (Mo. App. E.D. 2001). Rather, a defending party can prevail by defeating any one of the elements of the cause of action, either by showing undisputed facts that negate such element, or by showing that the non-movant will not be able to produce evidence sufficient to establish such element after an adequate period of discovery. See id.
In Buyers’ sole point on appeal, they argue that the trial court erred in granting Respondents’ motion for summary judgment because genuine issues of material fact exist regarding Buyers’ claims for a violation of the MMPA and negligent misrepresentation. Because we find the trial court's judgment overlooks material facts regarding water drainage issues on the Property, we agree.
Before discussing the elements of each claim specifically, we note generally that both claims require a finding that Respondents either supplied false information or failed to disclose material information. The trial court's judgment focuses on Denness’ letter, and specifically Denness’ statements about the Property's pool. The trial court found such statements were mere speculation regarding leakage from the pool. The trial court noted the pool inspection revealed no leaks in the pool, Denness had no apparent expertise regarding the existence of a leak in the pool, and Wernimont took proper steps to ensure the pool was not leaking. The court concluded, therefore, that there were no material facts to disclose contained in the letter and no indication that Respondents provided false information.
However, Buyers’ allegations are broader than simply notification of a potential pool issue arising from Denness’ letter. Buyers allege three actions by Wernimont constituted unlawful acts under the MMPA or negligent misrepresentations: (1) failing to disclose Denness’ letter because it contained material facts, regarding both the pool and water drainage issues, which Wernimont had a duty to disclose; (2) failing to amend the seller's disclosure statement in light of the letter, resulting in the seller's disclosure statement containing misrepresentations; and (3) misrepresenting that "every detail ha[d] been addressed" and the Property had been "meticulously maintained" in the MLS listing.
Regarding Denness’ letter, the trial court focused on Denness’ speculation as to the cause of the water runoff, rather than the existence of water runoff itself, which is the main issue here. Denness states a fact that water was coming from the Property onto his property, based on his own personal knowledge. The letter also states Nute had redirected his sump pump discharge into the street the...
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