Glover v. DaileyÂ
254 N.C. App. 46
| N.C. Ct. App. | 2017Background
- Defendants (Daileys) owned a Durham house; a 2008 water leak was inspected and repaired via an insurance claim (Nationwide); no mold was detected then.
- Defendants completed a seller property-disclosure form: they answered “No” to whether insurance/individual claims had been asserted to remedy any physical condition, but separately disclosed prior drainage/water issues and repairs.
- Altair (relocation company) agreed to purchase at a guaranteed price but defendants later sold on the open market; Altair signed the disclosure and paperwork referenced both Altair and defendants.
- Plaintiffs (Glovers) bought the house in Feb 2010 after a home inspection (no mold test); in 2012 a waterproofing report noted concealed subsurface water; plaintiffs discovered black mold in 2013.
- Plaintiffs sued defendants for fraud, negligent misrepresentation, and unfair/deceptive trade practices alleging failure to disclose the 2008 insurance claim; after bench trial the court dismissed all claims and plaintiffs appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility/weight of Cotton’s deposition opinion tying 2008 leak to later mold | Cotton’s deposition (no objection) established causation; court shouldn’t reweigh facts underlying his opinion | Trial court as factfinder may reject expert opinion as unsupported and not credible | Court upheld trial court’s credibility determination that Cotton’s opinion was based on insufficient facts/data (credibility, not a Daubert exclusion) |
| Causation between 2008 water loss and mold discovered in 2013 | 2008 repair/insurance claim was the source of subsequent mold; Cotton so opined | Defendants pointed to lack of direct proof linking 2008 event to mold; expert Richmond could not conclude causation | Court found no credible evidence proving 2008 loss caused mold; Richmond’s inconclusive but credible testimony supported that finding |
| Negligent misrepresentation (reliance & proximate cause) | False “No” on insurance-claim question was misrepresentation and caused plaintiffs’ remediation damages | Disclosure also noted prior water/drainage problems; plaintiffs had inspection reports and delayed action; reliance was not reasonable/causal | Court held plaintiffs failed to prove reasonable/justified reliance or proximate causation, so negligent misrepresentation claim fails |
| Unfair and deceptive trade practices (N.C. Gen. Stat. ch. 75) and homeowner exception | Plaintiffs argued defendants were not true "sellers" (Altair was) so exception shouldn't apply | Defendants were private homeowners who sold their residence; homeowner exception bars Chapter 75 claims | Court dismissed UDTP claim under the homeowner exception because defendants were private homeowners selling their residence |
Key Cases Cited
- Terry’s Floor Fashions, Inc. v. Crown Gen. Contractors, Inc., 184 N.C. App. 1 (appellate standard on credibility and factfinding in bench trials)
- Knutton v. Cofield, 273 N.C. 355 (trial court evaluates witness credibility)
- Shear v. Stevens Bldg. Co., 107 N.C. App. 154 (review standard for bench-trial findings and conclusions of law)
- Chicago Title Ins. Co. v. Wetherington, 127 N.C. App. 457 ("some evidence" supports trial court findings)
- In re Montgomery, 311 N.C. 101 (same)
- Raritan River Steel Co. v. Cherry, Bekaert & Holland, 322 N.C. 200 (elements of negligent misrepresentation)
- Simms v. Prudential Life Ins. Co. of Am., 140 N.C. App. 529 (negligent misrepresentation principles)
- Davis v. Sellers, 115 N.C. App. 1 (homeowner exception to Chapter 75 claims)
- Birmingham v. H&H Home Consultants & Designs, Inc., 189 N.C. App. 435 (confirmation of homeowner exception)
- Rosenthal v. Perkins, 42 N.C. App. 449 (Chapter 75 requires activity "in or affecting commerce")