Mobley v. James
2020 Ohio 380
Ohio Ct. App.2020Background
- In Oct 2016 Michael and AnnieRose Mobley agreed to buy a Cleveland house; the signed Ohio Residential Property Disclosure Form (RPDF) answered "No" to questions about sewer backups and water intrusion.
- Seller (James) prepared a supplemental disclosure (emailed to agents) stating a storm-sewer backup occurred "several years" earlier and that a sump pump had operated one or two times; seller did not list the event on the RPDF because it occurred more than five years earlier.
- Buyers paid for and attended a home inspection (Oct 29, 2016); the inspector recorded the inspection, noted elevated moisture and that the seller had disclosed a history of backed-up sewers, and warned of future risk.
- Buyers allege they did not receive the inspection report or the supplemental disclosure before closing; after purchase (Dec 2016) the basement experienced sewage intrusions in Nov 2017 and again in 2018, causing over $25,000 in claimed damages.
- Buyers sued for fraud, breach of contract, and unjust enrichment; the trial court granted seller's summary judgment; the court of appeals affirmed, ruling buyers could not justifiably rely on the RPDF given the inspection and supplemental disclosure.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether seller committed actionable fraud by failing to disclose sewer backups/water intrusion on the RPDF | Mobley: seller knowingly misrepresented/omitted history of sewer backups to induce the sale | James: either the event was outside the RPDF five-year window; supplemental disclosure and inspector put buyers on notice; sale was "as is"; flooding due to city sewers, not a property defect | Court: Even assuming misrepresentation, buyers could not justifiably rely on the RPDF because they were informed by the supplemental disclosure and inspector; summary judgment for seller affirmed |
| Effect of the "as‑is" clause and duty to disclose latent defects | Mobley: RPDF representations were material term of the contract; nondisclosure breached seller's duty | James: "As‑is" sale shifts inspection responsibility to buyers and relieves passive nondisclosure; seller need not inspect or acquire additional knowledge | Court: "As‑is" does not shield active fraud, but here notice from inspection/supplemental disclosure defeats reliance; reliance element lacking, so fraud claim fails |
| Whether buyers actually received the supplemental disclosure and inspection report before closing | Mobley: did not receive the inspection report or supplemental disclosure before closing and thus relied on the RPDF | James: record (Mobley deposition and inspection audio) shows the supplemental disclosure was provided and the inspector warned buyers on site; a later affidavit contradicting deposition is self‑serving | Court: Deposition testimony and audio corroborate receipt/notice; self‑contradictory affidavit insufficient to create a genuine issue of fact |
| Whether the flooding was a property defect attributable to seller or a municipal sewer capacity issue | Mobley: neighborhood history and seller's prior actions (sump, waterproofing) show seller knew of vulnerability | James: flooding resulted from undersized city storm sewers, not a latent defect of the property | Court: The opinion rests on the lack of justifiable reliance; the municipal‑sewer causation supports defendant's position but was not dispositive—reliance disposed of the claim |
Key Cases Cited
- Grafton v. Ohio Edison Co., 77 Ohio St.3d 102 (de novo standard for appellate review of summary judgment)
- Layman v. Binns, 35 Ohio St.3d 176 (doctrine of caveat emptor; vendor duty to disclose latent defects)
- Cohen v. Lamko, Inc., 10 Ohio St.3d 167 (elements of common‑law fraud)
- Dresher v. Burt, 75 Ohio St.3d 280 (moving party's and nonmoving party's burdens on Civ.R. 56 summary judgment)
- Byrd v. Smith, 110 Ohio St.3d 24 (affidavit cannot create factual issue that contradicts prior deposition testimony without explanation)
- Crown Property Dev., Inc. v. Omega Oil Co., 113 Ohio App.3d 647 (justifiable reliance is generally a question of fact)