Putman v. Walther

• Decision Date: 29 April 2022
• Docket Number: 20-0195
• Citation: 973 N.W.2d 857
• Parties: Danielle PUTMAN, Appellant, v. Shawn J. WALTHER and Amy M. Walther, Appellees.
• Court: Iowa Supreme Court

973 N.W.2d 857

Danielle PUTMAN, Appellant,

v.Shawn J. WALTHER and Amy M. Walther, Appellees.

No. 20-0195

Supreme Court of Iowa.

Submitted October 21, 2021

Filed April 29, 2022

Patrick C. Galles of Correll, Sheerer, Benson, Engels, Galles & Demro P.L.C., Cedar Falls, for appellant.

Matthew M. Craft of Dutton, Daniels, Hines, Kalkhoff, Cook & Swanson, P.L.C., Waterloo, for appellees.

Appel, J., delivered the opinion of the court, in which all justices joined.

APPEL, Justice.

A few months after a buyer purchased a home, the buyer discovered water in the basement. The buyer contacted a contractor who inspected the basement, found evidence of past water events, and submitted a bid for the needed repairs. In the next couple of months, four additional events of water infiltration in the basement occurred and continued thereafter.

The buyer sued the sellers, her real estate agent, the seller's real estate agent, and a home inspector, claiming that they had misrepresented the condition of the house prior to her purchase. The defendants moved for summary judgment based on the failure of the buyer to designate an expert on causation and damages. The district court granted summary judgment and the buyer appealed. We transferred the case to the court of appeals, which affirmed the district court.

Based on our review of the record and applicable rules, we conclude that the buyer offered sufficient evidence to survive the defendants’ motion for summary judgment. We therefore vacate the decision of the court of appeals, reverse the district court judgment, and remand the case for further proceedings.

I. Background Facts and Proceedings.

A. Overview of Facts. Danielle Putman was interested in purchasing a home in Waterloo from Shawn and Amy Walther. As required by Iowa law, Putman received from the Walthers a document entitled "Seller Disclosure of Property Condition" on February 8, 2018. The disclosure described the basement conditions as "2010 sewer back up [&] SW wall seepage a few times." Putman and the Walthers entered into a purchase agreement for the home on March 5, and the purchase closed as per the agreement on April 27.

In late June or early July 2018, Putman asserts that water seeped into the basement of the property after two inches of rain. She states that Magee Construction inspected the water damage shortly after the infiltration event and provided her a letter signed by David Holien from Magee Construction dated July 19, five sets of photographs, and a bid for necessary basement repairs (Magee Construction documents).

The Holien letter in the Magee Construction documents declared that water damage was observed in the lower level family room and bedroom. The letter declared that the walls of the rooms were tested with a moisture meter, revealing water in the drywall a foot up from the floor. The letter further noted that in the bedroom in the southwest corner, the floor was raised 2.5 inches off the concrete, "which indicates a previous water infiltration from the exterior." The letter observed that an exterior wall in the vicinity of a basement window had been built to channel water flow on the south side of the structure. The letter declared that an old drain line was capped off and a cleanout was under the carpet and pad of the family room. The letter concluded by stating, "I do not know what the south wall looks like behind the drywall, but it is obvious the infiltration of the water/rain on June 29th which was over 2? according to the US Weather Service came through this wall."

In addition to the Holien letter, Magee Construction attached a series of photographs of the basement and a detailed bid to repair the damage totaling $11,571.48.

After July 19, according to Putman, other instances of water infiltration in the basement occurred. Specifically, Putman claimed basement water infiltration occurred on August 6, September 4, September 19, and October 1. Further, according to Putman, the water infiltration in the basement continued after these occurrences.

B. Putman's Petition. Putman filed her petition in this case on October 25, 2018. She alleged water damage in the basement occurred in late June or early July and that additional water issues occurred on a frequent basis and damaged the home. Putman further asserted that she has been advised that the Walthers had a sump pit in the backyard with a pump for the purpose of pumping water away from the house. She additionally claimed that the defendants called the Waterloo water department at least twenty times for water issues regarding the house, including sanitary sewer issues that were not disclosed to her.

Attaching a copy of the Seller Disclosure of Property Condition, Putman alleged that the sellers understated the problem of water seepage. With respect to the basement conditions, the disclosure statement only disclosed "2010 sewer back up [&] SW wall seepage a few times." Putman alleged that the Walthers knew or should have known that the failure to disclose information about the persistent water infiltration in the basement would cause damage to her. She alleged that the Walthers’ intentional and negligent misrepresentation of the property was a proximate cause of mental, emotional, and "financial" damages.

Putman also alleged that: "[O]n July 16, 2018, Plaintiff contacted Magee Construction Company to inspect the water damage to the residence. Plaintiff received the attached report marked as ‘Exhibit C.’ "

Putman attached a copy of the Magee Construction documents to the original petition. Putman's amended petition contained the same allegation but Putman apparently failed to attach the Magee Construction documents to her second petition.

C. Course of Discovery. On March 15, 2019, the parties filed a trial scheduling and discovery plan with the district court. The order setting trial and incorporating the discovery plan required the disclosure of expert witnesses by Putman by June 11, 210 days before trial. The defendants served discovery on Putman, including interrogatories requesting Putman to identify expert witnesses. Notably, Putman disclosed "a representative of Magee Construction" as an expert witness in her discovery responses.

D. Motion for Summary Judgment. The Walthers joined the other defendants in filing for summary judgment. As undisputed facts, the defendants collectively observed that Putman in her deposition stated that she did not know the cause of the water infiltration. The defendants also claimed that Putman had failed to designate an expert to testify in the case and had not identified any witnesses that could testify as to the cause of water infiltration in her home.

Putman resisted the summary judgment motion. In her resistance, she asserted that she disclosed in discovery "Magee Construction who viewed the site and provided an estimate for the cost to repair and otherwise provided observations as to the source of water infiltration." Putman's resistance asserted that "the Plaintiff herself can testify as to the source of water and her observations having lived in the home for more than a year" and that she had "video evidence and photos of the water to provide to the Defendants." The Putman resistance further cited statements of a neighbor regarding the water infiltration in the basement of her residence and noted a call log of the City of Waterloo which "clearly indicates calls were made for storm water pumping."

The only evidence offered in support of Putman's resistance to the motion for summary judgment was a short affidavit by Putman herself. In the Putman affidavit, she asserted that she had read and verified every statement contained in her resistance. In addition, Putman claimed that water came into the basement from sanitary sewer overflow, seepage through the floor and walls, and other unknown sources. She asserted that after the real estate transaction closed, she "was advised" that the Walthers had a sump pit in the backyard in an effort to redirect water around the house, "presumably to keep water out of the basement." She further summarized the contents of the letter in the Magee Construction documents, noting the elevation of the floor in the finished basement bedroom beneath the carpeting, the presence of a drain hidden in the floor beneath the carpet, and watermarks on the wall behind the flooring and sheetrock. She asserted that the City of Waterloo continues to be active in water management in the area. Lastly, she claimed that "it is well known" that the neighborhood has severe issues with sewage backup which were not disclosed to her prior to her purchase.

E. Pretrial Conference. About a week before trial, the district court on January 3 held a pretrial conference. The district court noted that the motions for summary judgment were still pending but decided to proceed with the pretrial conference. With respect to pretrial evidentiary matters, the defendants challenged the late listing of a repair estimate prepared by Midwest Basement, and the late listing as a witness of Steve Burrell, a real estate agent who was prepared to testify regarding the resale value of the house in its present condition. Finally, the defendants challenged the admissibility of the call log of the City of Waterloo, asserting that Putman's resistance to the motion for summary judgment did not establish an adequate foundation for the admissibility of the document.

In addition, the parties at the pretrial conference discussed the Magee Construction documents. Notably, the defendants conceded that the Magee Construction documents were produced in discovery and, as a result, the defendants were aware of their contents. But according to the defendants, the Magee Construction documents don't

necessarily appear as a report, but as an estimate in which it explains the work that could be done in the home, even though it has not been done. We'll have other objections at the time of trial, but I think the expert report is limited to anything that has not been

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