Maples v. Porath, 12155

• Decision Date: 18 August 1982
• Docket Number: No. 12155,12155
• Citation: 638 S.W.2d 337
• Parties: Robert MAPLES and Shirley Maples, Plaintiffs-Appellants, v. Richard PORATH and Mary Porath, et al., Defendants-Respondents.
• Court: Missouri Court of Appeals

Page 337

638 S.W.2d 337

Robert MAPLES and Shirley Maples, Plaintiffs-Appellants, v. Richard PORATH and Mary Porath, et al., Defendants-Respondents.

No. 12155.

Missouri Court of Appeals,

Southern District,

Division One.

Aug. 18, 1982.

Glenn R. Gulick, Jr., Hershewe & Gulick, Joplin, for plaintiffs-appellants.

James E. Brown, Joplin, for defendants-respondents.

FLANIGAN, Judge.

On July 10, 1978, plaintiffs Robert Maples and Shirley Maples, as buyers, and defendants Richard Porath and Mary Porath, as sellers, entered into a contract for the sale of a residence located at 2407 Montana Place, Joplin, Missouri. Acting as agent for the sellers was defendant Charles Burt Realtors, Inc., ("Burt"). After the contract was performed and plaintiffs had taken possession, they discovered "termite infestation and termite damage." Plaintiffs filed an action in fraud against six defendants including the sellers and the realtor.

The original petition was filed in January, 1979. After discovery had been conducted plaintiffs filed a first amended petition in May 1979. Count I and Count II of that petition were directed against the sellers and the realtor. The order of the trial court held that neither Count I nor Count II stated a claim upon which relief can be granted against the sellers or the realtor, sustained their respective motions to dismiss and designated its order as a final judgment for purposes of appeal. Plaintiffs appeal.

Plaintiffs contend that the trial court erred in sustaining the motion to dismiss filed by realtor Burt for the reason that the first amended petition did state a claim for relief against that defendant. Count I of the petition sought $30,000 in actual damages and Count II, which incorporated the allegations of count I, sought $150,000 in punitive damages.

The initial inquiry is whether Count I states a claim against the realtor.

"Where a petition is attacked by a motion to dismiss for failure to state a claim, the mere conclusions of the pleader are not admitted. But the facts alleged are taken to be true and the pleader is entitled to all favorable inferences fairly deducible therefrom. If such facts and such inferences, viewed most favorably from plaintiff's standpoint, show any ground for relief, the petition should not be dismissed. If the allegations of the petition invoke principles of substantive law which may entitle the plaintiff to relief, the petition is not to be dismissed. A petition is not to be dismissed for failure to state a claim unless it appears that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief. The ruling on a motion to dismiss is ordinarily confined to the face of the petition which is construed in a light favorable to plaintiff." American Drilling v. City of Springfield, 614 S.W.2d 266, 271[2-4] (Mo.App.1981). (Citing authorities).

Under Missouri procedure a party may set forth two or more statements of a claim alternately, either in one count or in separate counts. When two statements are made in the alternative and one of them, if made independently, would be sufficient, the pleading is not made insufficient by the insufficiency of the alternative statement. A party may also state separate claims "regardless of consistency." Rule 55.10. ¹

"[T]he elements of actionable fraud consist of: (1) A representation. (2) Its falsity. (3) Its materiality. (4) The speaker's knowledge of its falsity or ignorance of its truth. (5) His intent that it should be acted on by the person and in the manner reasonably contemplated. (6) The hearer's ignorance of its falsity. (7) His reliance on its truth. (8) His right to rely thereon. (9) And his consequent and proximate injury." Swyden v. James H. Stanton Construction Co., 336 S.W.2d 389, 392 (Mo.1960).

Count I of the petition contains 29 paragraphs. It is prolix, vague, redundant, inconsistent and generally not a model of careful pleading. It is at least arguable that it does not meet the requirements of Rule 55.15 which provides that circumstances constituting fraud shall be stated with particularity. The issue here, however, is not whether the petition was subject to a motion for a more definite statement but whether it is fatally defective.

Against realtor Burt, the allegations of Count I included the following:

1. In 1978 Burt was acting as agent for the sellers in the sale of the residence. In June 1978 a prospective buyer named Tigner contacted Burt and the sellers with respect to purchasing the residence and a sale contract was entered into between the sellers and Tigner. One of the requirements of that contract was that a certificate of termite inspection "be issued." Pursuant to that contract Plimmers Pest Protection Company inspected the residence and found termite infestation and termite damage and the Tigner deal was not consummated.

2. Later in June 1978 Burt advertised the residence for sale and plaintiffs negotiated with Burt and the sellers. On July 10 plaintiffs and sellers entered into a sale contract which contained a provision that the sellers "furnish a written statement from a recognized exterminator that there was no evidence of termite or other wood-destroying insect infestation in the residence." Pursuant to that provision the sellers hired ABC Pest Control to conduct a termite inspection which was made on August 25, 1978.

3. The ABC inspection "revealed that there was no evidence of termites found in the structure." Sellers furnished the ABC report to plaintiffs. The ABC report was false.

4. Burt knew "of termite infestation of the premises" on July 19, 1978, "more than 9 days after the signing of the real estate contract and approximately 30 days before the ABC inspection."

5. Burt had knowledge of the Plimmers report. Burt did not disclose and refused to disclose that knowledge and remained silent with the intent to induce plaintiffs to buy the property. Burt's actions and representations were fraudulent because Burt knew of both the Plimmers report and the ABC report and did not know which of the two reports was true. Burt failed to ascertain which report was true and allowed the plaintiffs to rely on the ABC report when in fact that report was false.

6. Burt knowingly and willfully made false and fraudulent representations as to the condition of the property with the intent to induce plaintiffs to purchase the residence.

7. Burt's misrepresentations were material and caused plaintiffs to enter into the sale contract.

8. Relying upon Burt's "representations" plaintiffs entered into "a closing" with the sellers, the contract was consummated and the plaintiffs took title and possession. Shortly thereafter plaintiffs discovered termite infestation and termite damage, necessitating repairs and expenditures.

Seeking to uphold the order of the trial court, realtor Burt argues that the petition is defective with respect to him for the reason that Count I merely alleges that the realtor was silent and failed to disclose to plaintiffs the condition of the residence with respect to termite infestation. The realtor argues that mere failure, on part of the sellers' realtor, to disclose a material defect of the premises to a buyer does not constitute actionable fraud.

It is true that Count I alleges that Burt had superior knowledge of the Plimmers report and failed to disclose its contents to plaintiffs, and that Burt remained silent with the intent to induce plaintiffs to buy the property. However, other portions of Count I alleged that Burt knowingly and willfully made false and fraudulent representations to plaintiffs with respect to the termite condition and did so with the requisite intent.

The petition must be accorded a liberal construction, Mathews v. Pratt, 367 S.W.2d 632, 634 (Mo.1963), and, so viewed, the allegations of Count I, with regard to mispresentation on the part of the realtor, are sufficient to withstand a motion to dismiss.

Even if Count I is viewed as alleging merely non-disclosure on the part of the realtor, the issue is by no means as simple as the realtor claims it to be. There is substantial and impressive out-state authority for the proposition that a realtor, acting as agent for the seller, may be answerable in fraud to the buyer for non-disclosure of a material defect in the premises. Cooper v. Jevne, 56 Cal.App.3d 860, 128 Cal.Rptr. 724 (1976) (substandard construction); Saporta v. Barbagelata, 220 Cal.App.2d 463, 33 Cal.Rptr. 661 (1963) (termites); Lingsch v. Savage, 213 Cal.App.2d 729, 29 Cal.Rptr. 201 (1963); Neveroski v. Blair, 141 N.J.Super. 365, 358 A.2d 473 (1976) (termites); Weintraub v. Krobatsch, 64 N.J. 445, 317 A.2d 68 (1974) (roaches); Miles v. McSwegin, 58 Ohio St.2d 97, 388 N.E.2d 1367 (1979) (termites); Crum v....