MacFarlane v. Manly
| Citation | 264 S.E.2d 838,274 S.C. 392 |
| Decision Date | 31 March 1980 |
| Docket Number | No. 21179,21179 |
| Court | United States State Supreme Court of South Carolina |
| Parties | Jack MacFARLANE and Merle Irene C. MacFarlane, Appellants, v. Pauline N. MANLY and J. Bonner Manly, Respondents. |
Timothy G. Quinn and Daniel T. Stacey, Columbia, for appellants.
T. Alexander Beard of Cooper, Bowen, Beard & Smoot, Camden, for respondents.
This action was commenced by Jack MacFarlane and Merle Irene C. MacFarlane (buyers) against Pauline N. Manly and J Bonner Manly (sellers) for fraud in the sale of a house and lot by reason of failure to disclose termite and water damage. Motion was made by the sellers for summary judgment on the grounds that the buyers ". . . had knowledge of the alleged defects at the time of purchase, and further that Defendants (sellers) as a matter of law had no duty to disclose any matters to the Plaintiffs." The motion was granted. The buyers have appealed. We reverse.
The relevant facts are not greatly, if at all, in dispute. 1 The sellers had a house and lot listed for sale with John H. Gibson Realty. The buyers were in touch with Gibson and negotiations ensued, resulting in a written contract, under the terms of which the buyers agreed to pay $75,500.00 for the property. Sellers agreed to pay Gibson a real estate commission. The buyers agreed to accept the property "as is." Jack MacFarlane was a member of the military forces and was in Alaska during part of the period of negotiations and during the closing of the transaction. Gibson helped MacFarlane with such things as procuring an attorney, procuring one to examine the heating equipment and procuring Terminix Service, Inc., to examine the property. Terminix examined the property at Gibson's request and supplied its letter addressed to Gibson, who paid the bill but was later reimbursed by the buyers. The form letter supplied by Terminix, and addressed to John Gibson Realty, read as follows:
"Gentlemen:
This is to certify that the property at 3550 Overcreek Rd., Columbia, SC has been inspected and found to be free and clear of any active termite infestation.
This report is not to be construed as a guarantee, but rather is the opinion of a qualified inspector and the building is subject to undisclosed infestation and/or damage."
The house had been severely damaged by termites sometime prior to the sale. The sellers were aware of this and were aware of the fact that the house had temporary supports in the form of metal jacks. They had paid about $700.00 to repair termite and water damage and for installation of the temporary metal supports. It is inescapable that Terminix observed this and did not mention the same in its report. Reference to the letter of certification reveals that Terminix only said the house was " . . . free and clear of any active termite infestation." (Emphasis added.)
The order of summary judgment was granted in the court below on the theory that the buyers were not misled and that Terminix, being their agent, knew of the damage and its knowledge was imputed to the buyers. The court held that the buyers " . . . had actual knowledge of the condition of the premises through their agent, Terminix, and that Plaintiffs (buyers) were not justified in relying upon Defendants (sellers) to disclose matters Plaintiffs had hired professionals to determine." There is no contention that the buyers had actual personal knowledge of the defects.
It is obvious that the judge held as a matter of law that Terminix was agent of the buyers. The buyers submit that Terminix was an independent contractor. Terminix was actually selected and procured by Gibson, who was the sales agent of the sellers.
It should be noted that the letter of certification by Terminix did not purport to indicate whether there was or was not "undisclosed infestation and/or damage." The record does not reflect what Terminix was employed to do. Terminix took its instructions from Gibson, to whose advantage it was to procure a good report. His commission hinged upon convincing the buyers that the house was sound. It was also to the...
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