Knudson v. Weeks

• Decision Date: 31 March 1975
• Docket Number: Civ. No. 73-382-D.
• Citation: 394 F. Supp. 963
• Parties: Eleanor Gray KNUDSON, Plaintiff, v. Donald W. WEEKS et al., Defendants.
• Court: U.S. District Court — Western District of Oklahoma

394 F. Supp. 963

Eleanor Gray KNUDSON, Plaintiff, v. Donald W. WEEKS et al., Defendants.

Civ. No. 73-382-D.

United States District Court, W. D. Oklahoma, Civil Division.

March 31, 1975.

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Delmer L. Stagner, Oklahoma City, Okl., for plaintiff.

Richard R. Bailey, Oklahoma City, Okl., for Weeks.

Henry F. Featherly, Oklahoma City, Okl., for Hughes.

MEMORANDUM OPINION

DAUGHERTY, Chief Judge.

In the Spring of 1970 Plaintiff, Eleanor Gray Knudson, came to Oklahoma City, Oklahoma, for the purpose of purchasing a home. She had been employed at the University of California and had accepted employment at the University of Oklahoma as Dean of the College of Nursing. She employed a local real estate agent, Frank Kelley, to assist her. Through Kelley she located a home known as 6008 Queens Gate which is more specifically described as Lot 5, Block 4 of the Lansbrook Addition to Oklahoma City, Oklahoma. On May 10, 1970 Plaintiff contracted to purchase the house from its builder, Defendant Donald W. Weeks. Kelley contacted the Glenn Justice Mortgage Company (Glenn Justice) to obtain a loan for Plaintiff. Glenn Justice found a lender in the Kingfisher Savings and Loan Association (Kingfisher) who was willing to advance a mortgage loan at an agreeable interest rate. Kingfisher in its dealings with Glenn Justice requested a survey of the property. Accordingly Glenn Justice contacted the Hughes Engineering Company (Hughes) and ordered a survey. The order was made on May 26, 1970. On June 3, 1970 a survey of the subject property was made by Hughes. An error was made in the survey as it failed to disclose that the house at 6008 Queens Gate encroached over the rear lot line of Lot 5, Block 4 of Lansbrook Addition. The certificate of encroachments in the survey failed to note this defect. The certificate was delivered to Kingfisher. Hughes was paid for his work by Kingfisher. The cost of the survey was passed on to Plaintiff as an itemized loan closing cost. Plaintiff paid this charge when the loan closed. The sale of the house from Defendant Weeks to Plaintiff was consummated on June 16, 1970.

In August 1970, R. N. Coyle, President of the Lansbrook Association, informed Plaintiff that her house was over its back lot line. Plaintiff then owned and was occupying the property. Coyle stated that the encroachment was into a community owned greenbelt area and that he would take care of the problem. Coyle had learned of the encroachment from Defendants Weeks who had learned of it from a builder who was working on a house next door. The corrective action promised by Coyle was a quitclaim deed from the Lansbrook Association. It was not realized at the time that the encroachment was into a utilities easement which had been dedicated to the City of Oklahoma City. Thus, the community owned greenbelt area at the location here involved was burdened with the utilities easement. The promised quitclaim deed was not executed until April 11, 1972.

In April, 1973 Plaintiff contracted to sell the subject property to one Edward Caston. The contract price was substantially higher than the price for which Plaintiff had purchased the property. The sale to Caston fell through when Caston's mortgage lender ordered a loan survey and discovered the encroachment into the utilities easement and that the title defect had not been fully cured by the quitclaim deed from the Lansbrook Association. Caston's lender declined to advance a mortgage loan on the property with this defect in its title. In an effort to save the sale Plaintiff asked Weeks to escrow the estimated cost of curing the title defect, $7,500.00. Weeks refused to take this action. The contract between Plaintiff and Caston called for closing on or before May 1, 1973. Several extensions were made, the last one being until May 29, 1973. However, Plaintiff was unable to cure her title defect in this period of time and the sale to Caston was lost.

After the Caston sale failed the title defect was cured at Weeks' expense. On June 14, 1973 Weeks sent a letter to Plaintiff's attorney waiving any statute of limitations concerning any cause of action Plaintiff might have against him. The letter was not supported by consideration. The utilities easement was vacated where the house extended over it. Utility lines were dug up and rerouted and the area was resodded. It developed during this time that the air conditioner pad for the house had been laid over a manhole cover of the sewer which ran behind the house. During the period of time it took to correct these defects economic conditions in the United States changed. Interest rates soared and loans became difficult to obtain. Consequently Plaintiff experienced much difficulty in selling her house after the title defect was cured. When she finally did obtain a buyer she received a much lower price than she would have obtained if the sale to Caston had been consummated.

Plaintiff seeks to recover her losses from Defendants Weeks and Hughes and punitive damages from Defendants Weeks. She states four causes of action, one each in contract and tort against the Defendants Weeks and Defendant Hughes. Non jury trial of the case was conducted and the case has been briefed by all parties both before and after trial. The case can best be resolved by considering each of Plaintiff's four causes of action in turn.

TORT ACTION AGAINST SURVEYOR

It is Plaintiff's position that Hughes is liable to her in tort for the damages she sustained as a result of his failure to discover the encroachment of the house at 6008 Queens Gate over its back lot line. Hughes does not deny negligence in his performance of the survey. The evidence clearly shows that he was negligent. Instead Hughes asserts that the applicable statute of limitations has run and that he has not breached a duty owed to Plaintiff by his negligent survey.

For actionable negligence to exist there must be a duty on the part of a defendant to protect a plaintiff from injury, the defendant must have breached that duty, and there must be resulting injury to the plaintiff. Nicholson v. Tacker, 512 P.2d 156 (Okl.1973). As a general rule, in order to hold a defendant liable in tort for the breach of a duty arising out of contract there must be privity of contract between the injured party and the defendant. 65 C.J.S. Negligence § 4(11), 35 A.L.R.3d 544 § 3. Older cases generally hold that a lack of privity between a surveyor and a party injured by his negligent performance of a survey will relieve the surveyor of liability. See note 17, 35 A.L.R. 3d 504. However, a number of more modern cases hold that lack of privity between a surveyor and a plaintiff injured¹ by the surveyor's negligent performance of his contractual duty to provide an accurate survey will not relieve the surveyor of tort liability where it is known or foreseeable that the plaintiff will rely on the results of the survey and the extent of potential liability is limited both in possible number of occurrences and in number of persons who could be injured. Rozny v. Marnul, 43 Ill.2d 54, 250 N.E.2d 656 (1969); Tartera v. Palumbo, 224 Tenn. 262, 453 S.W.2d 780 (1970). These decisions are founded on the erosion of privity in the field of products liability. In view of the adoption of the doctrine of Manufacturer's Products Liability by the Supreme Court of Oklahoma in Kirkland v. General Motors Corporation, 521 P.2d 1353 (Okl. 1974) it seems likely that Oklahoma would also extend the liability of a surveyor to include persons not in privity of contract with the surveyor but who satisfy the abovementioned criteria.

However, it is unnecessary for this Court in this case to determine whether the Supreme Court of Oklahoma would so extend the liability of a surveyor. Assuming arguendo that Hughes would be liable in tort to Plaintiff under the facts of this case, it is apparent that the applicable statute of limitations ran before Plaintiff filed her Complaint. The undisputed testimony of the witnesses shows that Plaintiff was informed her house encroached over its rear lot line in August of 1970. She was informed by Coyle at that time that the encroachment was into the greenbelt area and that he would take care of the problem. It does not appear the Plaintiff had actual knowledge that the encroachment was actually into a utilities easement until the Caston sale fell through. Nevertheless, it must be held that Plaintiff's lack of actual knowledge as to her precise cause of action did not toll the running of the applicable statute of limitations in this case.

As a general rule, the mere ignorance of the existence of a cause of action or the facts constituting a cause of action on the part of a person in whom a cause of action lies will not toll its running. This rule applies unless a statute specifically provides that the limitations do not begin to run until the person in whom the cause of action lies has actual knowledge of it, or unless there has been a fraudulent concealment of the cause of action on the part of the person against whom it lies. 54 C.J.S. Limitations § 205. The statute of limitations begins to run when a cause of action accrues and a cause of action accrues when a plaintiff could first successfully maintain an action thereon. Turner v. Sooner Oil & Gas Co., 206 Okl. 344, 243 P.2d 701 (1952); Bowman v. Oklahoma Natural Gas Company, 385 P.2d 440 (Okl.1963).

It is Plaintiff's position that the two year tort statute of limitations provided by 12 Oklahoma Statutes 95, Third, did not begin to run against her until she had actual knowledge of the encroachment into the utilities easement rather than the greenbelt. There is no Oklahoma Statute providing that such actual knowledge is a prerequisite to the accrual of a cause of action sounding in tort. Therefore, Plaintiff attempts to bring herself within the...