Brief Fact Summary.
Lynn and Julie Cushman (Plaintiffs), purchased a home from Gregory and Elizabeth Kirby (Defendants) after viewing the premises on two occasions. Two months later, Plaintiffs sued for misrepresentation, claiming Defendants had represented there was good quality drinking water when there was not.
Synopsis of Rule of Law.
Under the Crompton v. Beedle standard: “Where one has full information and represents that he has, if he discloses a part of his information only, and by words or conduct leads the one with whom he contracts to believe he has made a full disclosure and does this with intent to deceive and overreach and to prevent investigation, he is guilty of fraud against which equity will relieve, if his words and conduct in consequence of reliance upon them bring about the result which he desires.”
Where material facts are accessible to the vendor only, and he knows them not to be within the reach of the diligent attention, observation and judgment of the purchaser, the vendor is bound to disclose such facts and make them known to the purchaser.View Full Point of Law
When visiting the house, Plaintiffs discovered an apparatus labeled “water conditioner” in the basement and inquired about the type of water Defendants had. Elizabeth Kirby replied, “It’s good. It’s fine. It’s a little hard, but the system downstairs will take care of it.” Mr. Kirby said nothing.
After moving into the home, Plaintiffs discovered that the well water was actually sulfur water and smelled of rotten eggs. Mrs. Kirby told them to add Clorox, which made the water taste like sulfur and chlorine. A plumber then informed that it was not hard water but sulfur water, it would cost at least $1,000 to rehabilitate the system, and the end result would bring the water only to a “tolerable level of drinkability.”
The Plaintiffs went with the best long-term solution and joined with neighbors’ hookup to the city water supply, which cost $5,000, plus annual water bills. Plaintiffs sued for misrepresentation and were awarded a jury verdict of $6,600.
· Did the trial court err in not granting Defendants’ motions for directed verdicts because the evidence showed that no actionable misrepresentations were made?
· Was the court’s charge on the issue of damages incorrect as a matter of law?
· It was not error to deny Mrs. Kirby’s motion for a directed verdict. The standard of conduct applicable to her was that stated in Crompton. She knew that the water contained sulfur and required treatment just to make it tolerable, but did not disclose it when asked by the Plaintiffs. Further, the Plaintiff’s relied upon Mrs. Kirby’s statements in deciding to purchase the house.
· The court correctly charged the jury that it was a jury question whether repairs to the treatment system would fully and adequately accomplish the goal of placing the Plaintiffs in the same position in which they would have been had the property been sold as represented. The damage award must stand.
· The Defendants knew the water contained sulfur but only admitted the water was “a little hard.” This half-truth was an actionable material representation.
· If damage is permanent and beyond repair, the variance in value of the property before and after the injury often affords the best guide to a just award, as it did in this case.