Osterhaus v. Schunk
249 P.3d 888
| Kan. | 2011Background
- Mark and Cathy Ross sold their Overland Park home to Jean Toth in spring 2001; disclosure disclosed foundation cracks, wall movement, and water in basement.
- Toth signed a seller's disclosure statement in July 2002 after inspecting the home and before closing, despite Toth's prior knowledge of foundation issues.
- Schunk (TopPros) handled the listing; he did not review the disclosure with Toth or question its accuracy during the listing.
- Tomlinson’s July 2002 offer triggered an inspection revealing basement wall cracking; contract canceled, and epoxy repairs were performed by Marsee in late July 2002.
- Osterhaus signed the Buyer Acknowledgment and Agreement on July 26, 2002; the amendment package later provided $900 in closing costs instead of repairs, and Osterhaus took possession in August 2002.
- Spring 2004 to 2006: Osterhaus sued for KCPA violations, fraud, fraud by silence, negligent misrepresentation, and breach of contract; district court granted summary judgment; this Court reversed in part and remanded for factual findings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Osterhaus' signature waive reliance on disclosures? | Osterhaus relies on Alires and rejects McLellan's waiver rule. | McLellan controls; waiver of reliance bars claims. | McLellan reversed; waiver not conclusive to bar reliance. |
| Do 'as is' and release provisions bar contract claim? | Amendment's as-is clause does not bar breach for foundation defects. | As-is clause and release bar contract claim. | Remanded for factual findings; not barred as a matter of law. |
| Are fraud and negligent misrepresentation claims time-barred? | discovery rule should start after injury; issue of accrual is factual. | 2-year limitations apply from discovery. | Remanded for factual determination of ascertainable injury date. |
| Is Toth a 'supplier' under KCPA? | Toth's multiple real estate transactions qualify her as supplier. | Whether she is a supplier is a factual question. | Remanded for district court to decide supplier status. |
| BRRETA negligent misrepresentation duty question? | Schunk had actual knowledge and failure to disclose; BRRETA imposes duty. | Limitations on disclosure based on reports; duty contested. | Remanded for factual findings on what Schunk knew and disclosed. |
Key Cases Cited
- Alires v. McGehee, 277 Kan. 398 (2004) (real estate disclosures may not bar reliance if integration and inspection contexts exist)
- McLellan v. Raines, 36 Kan. App. 2d 1 (2006) (paragraph 5 waiver language interpreted to bar reliance; later clarified here)
- Brennan v. Kunzle, 37 Kan. App. 2d 365 (2007) (reasonableness of inspections; issues of discoverability of defects)
- Katzenmeier v. Oppenlander, 39 Kan. App. 2d 259 (2008) (reliance and discovery issues with identical disclosure forms)
- Boegel v. Colorado Nat'l Bank of Denver, 18 Kan. App. 2d 546 (1993) (fraudulent concealment and contract waivers in real estate context)
- Munkres v. McCaskill, 64 Kan. 516 (1902) (examined effect of inspection undertakings on reliance and contract formation)
- Fox v. Wilson, 211 Kan. 563 (1973) (contractual duty to inspect and avoid reliance on misrepresentation)