Noss v. Abrams

• Court: Missouri Court of Appeals
• Writing for the Court: CARL R. GAERTNER; HAMILTON, P.J., and STEPHAN
• Citation: Noss v. Abrams, 787 S.W.2d 834 (Mo. App. 1990)
• Decision Date: 27 March 1990
• Docket Number: No. 56602,56602
• Parties: Richard L. NOSS, Appellant, v. Lloyd R. ABRAMS, et al., Respondents.

Page 834

787 S.W.2d 834

Richard L. NOSS, Appellant, v. Lloyd R. ABRAMS, et al., Respondents.

No. 56602.

Missouri Court of Appeals,

Eastern District,

Division Four.

March 27, 1990.

Motion for Rehearing and/or Transfer to Supreme Court

Denied April 20, 1990.

Donald Kenneth Anderson, Jr. and Timothy A. McGuire, St. Louis, for appellant.

Robert D. Blitz and Charles S. Kramer, St. Louis, for respondents.

CARL R. GAERTNER, Judge.

Plaintiff Richard L. Noss appeals from an order granting summary judgment in favor of defendants Lloyd R. Abrams, Richard B. Rothman, Red Bud Associates, a partnership, and A & R Investments, Inc., on his claim for actual and punitive damages for fraud in connection with a real estate transaction. We affirm.

Plaintiff was the owner of the real property known as 8707 Red Bud Avenue in St. Louis County. On April 10, 1987, he entered into a contract with defendant A & R Investments, Inc., through its president, Lloyd Abrams, to sell this property for the sum of $75,000. On June 30, 1987, plaintiff conveyed the property by general warranty deed to Red Bud Associates, the assignee of A & R Investments, Inc. Lloyd Abrams and Richard B. Rothman are the general partners of Red Bud Associates and they are also the sole shareholders, officers and directors of A & R Investments, Inc. Both men are licensed attorneys in Missouri and Abrams is licensed as a real estate broker. On March 10, 1989, 23 months after execution of the sale contract, Red Bud Associates sold the property to a third party, Hycel Partners I, a limited partnership, for the sum of $124,031.25.

Plaintiff filed this action alleging that defendant Abrams, as the agent of Red Bud Associates and A & R Investments, Inc., was guilty of fraudulent concealment in that he had failed to disclose to plaintiff the true market value of the property and the fact that Abrams was a licensed real estate broker buying real estate for himself, in violation of a rule of the Missouri Real Estate Commission, 4 CSR 250-8.110(1). Defendants filed a Motion for Summary Judgment supported by affidavits. Plaintiff filed a counter affidavit. After a hearing on April 19, 1989, defendants' Motion for Summary Judgment was sustained.

Plaintiff presents three points on appeal. His first assigns trial court error in granting summary judgment to defendants because genuine issues of material fact were not resolved by respondents' affidavits.

We review the record on summary judgment in the light most favorable to the party against whom summary judgment was rendered, and will not set aside the order if it is sustainable on any theory. Zafft v. Eli Lilly & Co., 676 S.W.2d 241, 242-3 (Mo. banc 1984); Gast v. Ebert, 739 S.W.2d 545, 546 (Mo.App.1987). If a genuine issue of material fact exists, summary judgment is inappropriate. An issue of fact is material if it has "... legal probative force as to a controlling issue in the litigation," Tatum v. General Motors Acceptance Corp., 732 S.W.2d 591, 592 (Mo.App.1987), and is said to exist when there is the "... slightest doubt about a fact." Gast, 739 S.W.2d at 546. ¹ Summary judgment is appropriate only when the record discloses no theory that would permit recovery and the moving party is entitled to summary judgment as a matter of law. Zafft, 676 S.W.2d at 244; Signature Pool & Court v. City of Manchester, 743 S.W.2d 538, 540 (Mo.App.1987); Rule 74.04(c).

Although the denial in defendants' answer of certain allegations of plaintiff's petition reveals some matters to be in dispute, we find no dispute regarding the facts which are material to the dispositive issue in this case: the existence of a duty upon the buyer to disclose facts to the seller the breach of which gives rise to a cause of action for damages.

It is not disputed that this was an arms-length transaction and that no fiduciary relationship existed between plaintiff and Abrams. In these circumstances, we know of no rule of law or business practice which requires a buyer to advise a seller that the buyer believes the property has a market value in excess of the offered purchase price. As stated in Ash Grove Lime & Portland Cement Co. v. White, 361 Mo. 1111, 238 S.W.2d 368, 372 (1951), it has never been contended or maintained in the absence of a fiduciary relationship "... that the buyer is bound to reveal all facts known to himself which would enhance the value of the article sold...." Moreover, expressions of market value are generally considered to be expressions of opinion, not fact, and therefore not a basis for an action in fraud. Gamel v. Continental Insurance Company, 463 S.W.2d 590, 595 (Mo.App.1971). Plaintiff does not allege any misrepresentation nor any concealment of fact which would materially affect the market value of his property which was known by defendants but undiscoverable by him. For this reason, the cases relied upon by plaintiff are distinguishable.

In Curtis v. Kays, 670 S.W.2d 887 (Mo.App.1984), a wife was found entitled to recision of a marriage dissolution separation contract because of her husband's fraudulent concealment of $24,000 paid to him for an interest in his closely held corporation, and because of husband's false statements regarding the present value of his pension and profit sharing plans. The court held that because of the confidential relationship between husband and wife and the fact they were not engaged as adversaries dealing at arms-length, the husband had a duty of honest disclosure regarding his business affairs which he volunteered to furnish to his wife knowing she would rely thereon. Id. at 893. Because of these circumstances, the court noted the inapplicability of the general rule that a representation of value is an expression of opinion which will not support a claim of fraud. Id. at n. 2. Plaintiff relies upon a sentence drawn out of context from the Curtis opinion which, when considered in light of all the circumstances of that case, has no applicability to the facts in this case. Similarly, in Walters v. Maloney, 758 S.W.2d 489 (Mo.App.1988), it was the fiduciary relationship between plaintiffs and their own real estate broker which created a duty upon the broker to disclose to his clients his knowledge of the existence of a bank lien upon property superior to the deed of trust taken by plaintiffs as security for partial payment of the purchase price of their residence. This trust and confidence inherent in a client-broker relationship was held to excuse plaintiff's failure to make an independent inquiry which would have disclosed the true facts. Id. at 496.

In his reply brief, plaintiff cites without discussion the case of Fairmont Foods Co. v. Skelly Oil Co., 616 S.W.2d 548 (Mo.App.1981). In Fairmont Foods the plaintiff did not discover until after completion of its purchase of real estate that access to the land was limited because of a condemnation proceeding, a fact known to but not disclosed by the seller. The court observed that in some instances a superior knowledge on the part of one of the parties which is not within the fair and reasonable reach of the other may give rise to duty to speak. Id. at 550. A party claiming fraudulent nondisclosure under this rule must prove his inability to discover the undisclosed fact in the exercise of reasonable diligence. The court concluded that the seller's silence regarding its knowledge of the access limitation did not constitute fraudulent concealment because the buyer could have easily discovered the condemnation proceeding by reasonable inquiry and therefore had no right to rely upon the vendor's silence. Id. at 552.

The cases relied upon by plaintiff lend support to the denial of his claim. They deal with nondisclosure of facts materially affecting value. Here plaintiff alleges no facts known to defendants and not discoverable by him; his claim is based solely upon his conclusory allegation that defendants had superior knowledge of the market value of his property. Market value of a parcel of residential real estate is dependent upon many and oftentimes very subjective factors. As noted above, statements of value are generally considered to be expressions of opinion. The fact that Abrams is a real estate broker may give him greater access to information regarding what a buyer might be willing to pay, but that fact alone does not afford him knowledge superior to that of an owner regarding what a seller might be willing to accept. Nothing in the record before us supports plaintiff's claim of fraudulent concealment based upon the contention that defendants failed to disclose their "kn...