Pickering v. Garrison, No. CA08-810 (Ark. App. 2/18/2009)

• Decision Date: 18 February 2009
• Docket Number: No. CA08-810.,CA08-810.
• Citation: Pickering v. Garrison, No. CA08-810 (Ark. App. 2/18/2009), No. CA08-810. (Ark. App. Feb 18, 2009)
• Parties: David H. PICKERING and Mary L. Pickering, Appellants, v. Winfred W. GARRISON and Cynthia R. Garrison, Appellees.
• Court: Arkansas Court of Appeals

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David H. PICKERING and Mary L. Pickering, Appellants, v.Winfred W. GARRISON and Cynthia R. Garrison, Appellees.

No. CA08-810.

Court of Appeals of Arkansas, Division IV

Opinion Delivered February 18, 2009.

Not Designated for Publication

Appeal from the Pulaski County Circuit Court, [No. CV2004-13789], Honorable James Maxwell Moody, Jr., Judge.

Affirmed.

KAREN R. BAKER, Judge.

David and Mary Pickering have appealed from the Pulaski County Circuit Court's decision awarding rescission of a real-estate contract to appellees Winfred and Cynthia Garrison.This dispute was previously before us, in CA06-59, when we reversed the entry of summary judgment to the Pickerings and remanded the case for trial.After a bench trial, the circuit court granted rescission to appellees, prompting this appeal.We affirm the circuit court's decision in all respects.

This case began with the May 26, 2004 sale of a house in Chenal Valley in west Little Rock by appellants to appellees.Mr. Pickering's construction company built the house in 1991-92 and the Pickerings lived there.¹Appellees agreed to buy the house for $890,000, and appellants provided appellees with a written disclosure about the property's condition.On behalf of appellees, Al Williams performed an inspection of the property on May 17, 2004, while Mrs. Garrison, Mr. Pickering, and appellees' real estate agent, Betty Coney, were present.According to appellees, Mr. Williams asked Mr. Pickering about some foundation vents located in the brick on the back side of the house, and Mr. Pickering replied that the foundation was a concrete slab, failing to mention that there were also two crawl spaces.(Because there was no access to either crawl space, the witnesses referred to them as "voids.")Mr. Williams found no serious problems with the house.Appellees obtained a letter from AAA Roofing Co., Inc., stating that the roof was in good condition.Mr. Pickering also provided appellees with a letter from Specialty Services stating that there was no roof damage.The termite inspection also found no problems.

The contract contained a merger clause, and in paragraph 15(B), it provided for the buyers' inspection.It stated: "The buyer understands and agrees that pursuant to the terms of Paragraph 15(B), they will be accepting this property `AS IS' at closing."It set forth the following buyers' disclaimer:

26.BUYER'S DISCLAIMER OF RELIANCE: BUYER CERTIFIES BUYER HAS PERSONALLY INSPECTED OR WILL PERSONALLY INSPECT, OR HAS HAD OR WILL HAVE A REPRESENTATIVE INSPECT, THE PROPERTY AS FULLY AS BUYER DESIRES AND IS NOT RELYING AND SHALL NOT HEREAFTER RELY UPON ANY WARRANTIES REPRESENTATIONS OR STATEMENTS OF THE SELLER, LISTING AGENT FIRM, THE SELLING AGENT FIRMS, OR ANY AGENT, INDEPENDENT CONTRACTOR OR EMPLOYEE ASSOCIATED WITH THOSE ENTITIES, REGARDING THE AGE, SIZE (INCLUDING WITHOUT LIMITATION THE NUMBER OF SQUARE FEET IN IMPROVEMENTS LOCATED ON THE PROPERTY), QUALITY, VALUE OR CONDITION OF THE PROPERTY, INCLUDING WITHOUT LIMITATION ALL IMPROVEMENTS, ELECTRICAL OR MECHANICAL SYSTEMS, PLUMBING OR APPLIANCES OTHER THAN THOSE SPECIFIED HEREIN (INCLUDING ANY WRITTEN DISCLOSURERS [SIC] PROVIDED BY SELLER AND DESCRIBED IN PARAGRAPH 16 OF THIS REAL ESTATE CONTRACT), IF ANY, WHETHER OR NOT ANY EXISTING

DEFECTS IN ANY SUCH REAL OR PERSONAL PROPERTY MAY BE REASONABLY DISCOVERABLE BY BUYER OR A REPRESENTATIVE HIRED BY BUYER.NEITHER LISTING AGENT FIRM NOR SELLING AGENT FIRM CAN GIVE LEGAL ADVICE TO BUYER OR SELLER.LISTING AGENT FIRM AND SELLING AGENT FIRM STRONGLY URGE STATUS OF TITLE TO THE PROPERTY, PROPERTY CONDITION, SQUARE FOOTAGE OF IMPROVEMENTS ON THE PROPERTY, QUESTIONS OF SURVEY AND ALL REQUIREMENTS OF SELLER AND BUYER HEREUNDER SHOULD EACH BE INDEPENDENTLY VERIFIED AND INVESTIGATED.BUYER IS HEREBY NOTIFIED THAT BUYER WILL BE REQUIRED TO UTILIZE THE INSPECTION REPAIR & SURVEY ADDENDUM PURSUANT TO PARAGRAPH 10 AND PARAGRAPH15B, AND WILL BE REQUIRED TO DO A FINAL SIGN OFF ON PAGE 3, UPON COMPLETING ALL INSPECTIONS ON SAID ADDENDUM PRIOR TO, OR AT CLOSING.

The "Inspection, Repair and Survey Addendum" form, signed by appellees before closing, stated:

5.BUYERS AGREEMENT TO PROPERTY CONDITIONS: THE BUYER ACKNOWLEDGES THE AGENT(S) INVOLVED IN THIS TRANSACTION HAVE MADE THE BUYER AWARE THAT HOME INSPECTORS WHO PROVIDE THAT SERVICE REGULARLY ARE AVAILABLE AND THE BUYER COULD CHOOSE FROM THOSE HOME INSPECTORS LISTED IN THE YELLOW PAGES, OR THOSE THE AGENTS(S) KNOW ABOUT, OR THE BUYER COULD CONTACT A PROFESSIONAL SOCIETY OR ORGANIZATION OF HOME INSPECTORS TO FIND A SUITABLE HOME INSPECTOR.BUYER IS NOT RELYING ON THE AGENT(S) ADVICE OR RECOMMENDATION IN REGARDS TO CHOOSING A HOME INSPECTOR.ALSO, BUYER UNDERSTANDS THAT THE RECEIPT OF A HOME INSPECTION AND A SELLER PROPERTY DISCLOSURE DOES NOT RELIEVE BUYER FROM THE RESPONSIBILITY OF PERSONALLY INSPECTING THE PROPERTY UNTIL THE BUYER IS FULLY SATISFIED.BUYER WARRANTS, REPRESENTS AND ACKNOWLEDGES THAT BUYER AND ALL PERSONS OR ENTITIES DESIRED BY BUYER HAVE INSPECTED THE PROPERTY TO THE FULLEST EXTENT DESIRED BY BUYER AND FIND THE CONDITION OF THE PROPERTY ACCEPTABLE IN ALL RESPECTS.BUYER REAFFIRMS ALL DISCLAIMERS SET FORTH WITHIN THE REAL ESTATE CONTRACT BETWEEN BUYER AND SELLER.

BUYER HAS HAD AN OPPORTUNITY TO INSPECT, REVIEW AND VISIT THE PROPERTY AND TO OBTAIN A BOUNDARY SURVEY OF THE PROPERTY TO DETERMINE THAT THE PROPERTY ACTUALLY CONVEYED IS THE PROPERTY THE BUYER UNDERSTANDS IS BEING CONVEYED, AND BUYER IS NOT RELYING ON ANY STATEMENT (WRITTEN OR ORAL) OF LISTING AGENT FIRM, SELLING AGENT FIRM, OR SELLER CONCERNING THE SIZE, DIMENSIONS, ACREAGE, AREA OR

LOCATION OF THE PROPERTY.THE FACT THAT THE BUYER COMPLETES THE PURCHASE OF THIS PROPERTY WARRANTS THAT THE BUYER IS COMPLETELY SATISFIED WITH THE CONDITION OF THE PROPERTY.

When appellees moved into the house, they discovered that portions of it were not built on a slab foundation, as had been represented by David Pickering.In fact, two additions to the house were built on crawl spaces, for which no exterior access existed.These crawl spaces did not comply with construction codes and were not shown on the original building plans presented to the City of Little Rock or the Chenal Valley Property Owners' Association.As it turned out, a final building inspection had not been performed; a certificate of occupancy had never been issued; and appellants had failed to obtain the necessary permits and inspections for the construction of an addition to the family room at the back of the house.However, in the disclosure form, appellants had represented that all additions were done following the issuance of permits and in compliance with building codes.

In August 2004, appellees discovered termite damage in the bedroom next to the family room and in the exercise room adjacent to the garage.Appellees received a letter in October 2004 from Charles Givens, the building codes manager for the City of Little Rock's planning department, listing numerous code and zoning violations and stating that, although the house received all final plumbing, electrical, and mechanical inspections, there had never been a final building inspection; that a certificate of occupancy had never been issued; and that most of the termite damage was a result of the code violations:

This house was permitted in 1991 by David Pickering Construction Company.The house received all final plumbing, electrical and mechanical inspections.However, there was never a final building inspection or a certificate of occupancy issued for the structure.

Our inspection revealed the following code violations as well as zoning violations.

1) Three additions built on the house without zoning clearances, permits or inspections.

2) Master bedroom and formal living room had no crawl space or access openings or ventilation.

3) Extensive termite damage to additions, back front and west walls and surrounding wood foundations, also potential termite damage where not already exposed.

4) Improper footings and foundation [of] formal living room.

5) Courtyard addition on west side had no zoning clearance, permits or inspections.

6) Courtyard addition slab has visible signs of extensive cracking throughout.

7) Columns and wall on exterior of slab are at least ten (10) feet in height and require an architect or engineer approval prior to construction.

8) Concrete drainage goes under corner of family room foundation.

9) Numerous leaks in roof, visible damage to ceilings and walls.

10) No ground vapor barrier on room additions and debris under crawl space.

11) Dishwasher has no air gap.

12) Under island sink drains too small, must be at least 3 inch.

13) Hot water heater has been replaced since permitting of house.

14) Recommend that electrical, plumbing and mechanical concerns be checked out by licensed contractors.

15) Alterations have also been done to the rear deck/patio.

16) Front driveway was not permitted under original building permit application.

17) Kitchen cooking top vent pipe needs to be properly vented (currently vents to manual roof vent).

18) Covers needed on six closet lights.

Conclusion: The house was never finaled and it has been over ten years since this house was originally permitted.There has been a lot of work that was performed without permits or inspections on these additions as well as other parts of the house.Most of the problems with termite damage are a result of construction not meeting code.The courtyard addition because of numerous structural problems should be completely removed and rebuilt.The other additions should be permitted, corrected and re-inspected for code compliance.Also the entire house needs to be checked by licensed electrical, plumbing and mechanical contractors to ensure that all systems are working properly and are code compliant.After all of these items are corrected the house should be reinspected by the building inspector and a final certificate of...