366 P.3d 1088
Idaho2016Background
- The Humphries bought a Burley, Idaho home in 2009; the property’s irrigation used water from a farm-owned well (Farm Well) while domestic water came from a shared well on adjacent land owned by Allen and Jane Becker.
- The MLS listing described water as a “Shared Well” and lawn sprinklers as “Auto / Full”; the RE-25 disclosure checked “Private System” for Domestic, Irrigation, and Sewer. Eileen Becker signed the disclosure; Allen and Jane did not.
- At an October 7, 2008 meeting realty agent Sheila Adams gathered information from the Beckers; Adams later drafted the MLS listing (which did not mention the Farm Well). Adams testified the Beckers told her the Farm Well would not continue after sale; Beckers dispute some of Adams’ recollection.
- After closing the Humphries discovered the sprinklers were supplied by the Farm Well (no legal right to that water) and sued for fraud and violations of the Idaho Property Condition Disclosure Act; Allen and Jane were later added as defendants.
- The district court granted summary judgment for the Beckers and awarded attorney fees; on appeal the Idaho Supreme Court (majority) affirmed summary judgment as to Allen and Jane but reversed/vacated summary judgment as to Eileen on claims grounded in the MLS listing and the disclosure form and on the Disclosure Act; it affirmed fees to Allen and Jane under Idaho Code §12-120 but vacated the fee award to Eileen pending outcome at trial.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Allen and Jane were Eileen’s agents for the sale (imputing their knowledge) | Humphries: Allen/Jane acted as agents by providing info to agents and relaying communications, so their knowledge should be imputed to Eileen | Beckers: They were independent third parties, not controlled by Eileen; no agency created | Held: No agency as matter of law; summary judgment for Allen and Jane affirmed |
| Whether Allen and Jane made actionable misrepresentations or had duty to disclose Farm Well/sprinkler facts | Humphries: Their knowledge of the Farm Well/sprinkler system gave rise to disclosure duty or affirmative misstatements | Beckers: They made no affirmative statements to buyers; not parties to the sale nor agents; no duty to disclose | Held: No genuine issue of material fact as to Allen and Jane; fraud claims against them fail |
| Whether Eileen is liable for MLS and Disclosure Form statements (fraud/omission) | Humphries: Eileen should have known MLS would misrepresent water sources (present at meeting) and the disclosure mischaracterized irrigation water; omissions/material misstatements support fraud and Disclosure Act claims | Eileen: She did not see MLS, disclosure entries were accurate ("Private System"); no actual knowledge or intent to deceive; MLS drafted by agent | Held: Reversed as to Eileen — material factual issues exist whether she knew or should have known of MLS misstatements and whether the disclosure omitted a problem (no right to irrigation water); claims against Eileen survive summary judgment |
| Whether attorney fees awarded were proper | Humphries: Fee award to Beckers improper where not contract parties (Allen/Jane) or where Eileen did not prevail | Beckers/Eileen: Contract provides prevailing-party fees; alternatively §12-120 supports fees to prevailing defendants | Held: Fees to Allen and Jane affirmed under §12-120; fees to Eileen vacated because she is not prevailing; appellate fees may be awarded later; costs allocation adjusted on appeal |
Key Cases Cited
- Golub v. Kirk-Hughes Dev., LLC, 158 Idaho 73, 343 P.3d 1080 (standard for summary judgment and drawing inferences for nonmoving party)
- Knutsen v. Cloud, 142 Idaho 148, 124 P.3d 1024 (agency principles and control requirement)
- Country Cove Dev., Inc. v. May, 143 Idaho 595, 150 P.3d 288 (elements of fraud defined)
- Sowards v. Rathbun, 134 Idaho 702, 8 P.3d 1245 (duty to disclose and theories for omission-based fraud)
- Printcraft Press, Inc. v. Sunnyside Park Util., Inc., 153 Idaho 440, 283 P.3d 757 (court’s role in deciding duty to disclose as a matter of law)
- Farm Credit of Spokane v. W.W. Farms, Inc., 122 Idaho 565, 836 P.2d 511 (contractual prevailing-party attorney-fee provisions enforceable)
- Sorenson v. Adams, 98 Idaho 708, 571 P.2d 769 (vendor’s duty to know and disclose material property facts)