RICHARD MESSERLY and RHONDA MESSERLY, Plaintiffs-Appellants, v. ROBERT E. BOEHMKE, SR., Defendant-Appellee.
Docket No. 4-13-0397
Appellate Court of Illinois, Fourth District
March 11, 2014
2014 IL App (4th) 130397
Illinois Official Reports
Held
(Note: This syllabus constitutes no part of the opinion of the court but has been prepared by the Reporter of Decisions for the convenience of the reader.)
The entry of summary judgment for defendant in an action alleging that defendant violated the Residential Real Property Disclosure Act and that plaintiffs suffered damages as a result of defendant’s failure to complete the disclosures required under the Act in conneсtion with the sale of his house to plaintiffs was reversed, since plaintiffs did not waive defendant’s obligations under the Act and genuine issues of material fact existed as to whether there were material defects in the plumbing system and the foundation of the house.
Decision Under Review
Appeal from the Circuit Court of Macoupin County, No. 04-LM-53; the Hon. Patrick J. Londrigan, Judge, presiding.
Judgment
Reversed.
Counsel on Appeal
Rick Verticchio and Gina Verticchio (argued), both of Verticchio & Verticchio, of Gillespie, for appellee.
Panel
JUSTICE KNECHT delivered the judgment of the court, with opinion.
Justices Turner and Steigmann concurrеd in the judgment and opinion.
OPINION
¶ 1 In March 2004, plaintiffs Richard and Rhonda Messerly filed a complaint against defendant, Robert E. Boehmke, Sr. Plaintiffs’ third amended complaint alleged (1) defendant violated the Residential Real Property Disclosure Act (Act) (
¶ 2 On appeal, plaintiffs claim the record contains evidence defendant knowingly violated the Act аnd the trial court erroneously concluded plaintiffs could waive defendant’s obligations under the Act. Plaintiffs also ask this court to reverse the trial court’s grant of summary judgment in favor of defendant and order the trial court to grant their motion for summary judgment as to defendant’s liability. We reverse.
I. BACKGROUND
A. Plaintiffs’ Allegations
¶ 5 In the July 2010 amendment to plaintiffs’ complaint, they alleged on September 29, 1998, they purchased a home from defendant, at 105 Shelby, in Gillespie, Illinois, for $87,000. On or about August 7, 1998, defendant filled out and signed the disclosure report. Plаintiffs alleged defendant violated the Act as the disclosure report was false and incomplete because it did not disclose material defects in the home’s foundation and plumbing system. See
B. Discovery
1. The Disclosure Form
¶ 8 In August 1998, prior to the sale, defendant filled out a “Residential Real Property Disclosure Report” (disclosure form) as required under the Act. See
¶ 10 Question No. 6 asked if defendant was “aware of material defects in the walls or floors” (
¶ 11 A space on the form is provided for signatures along with a space for the date. Defendant signed the disclosure form and wrote “August 8, 1998,” next to his name. Plaintiffs also both signed the disclosure form and wrote “August 25, 1998,” next to their names.
2. The Letter From Defendant’s Insurance Company
¶ 13 Prior to October 1991, defendant submitted a claim to his insurance carrier, State Farm Fire and Casualty Company (State Farm). State Farm responded with a letter dated October 30, 1991, and addressed to defendant, stating State Farm had received a report for the Illinois Mine Subsidence Insurance Fund (Fund). State Farm indicated the Fund had investigated defendant’s clаim and concluded “the damage to your home is not the result of mine subsidence but rather settling.” The letter stated damage from settling was specifically excluded from defendant’s homeowner’s insurance policy and denied defendant’s claim.
3. Richard Messerly’s Deposition Testimony
¶ 15 Richard testified he purchased the house at 105 Shelby from defendant in 1998. Richard lives in the house with his wife, Rhonda; his son; and his son’s girlfriend and two children.
¶ 16 Richard stated within two days of moving into the house his children took a shower downstairs and “water was leaking all over the place.” Specifically, the water was “coming out of the wall itself and leaking down into the basement floor.” Richard’s wife Rhonda contacted defendant, who indicated a certain wrench or extension was necessary to tighten the area where the leak occurred. Richard called a plumber, who told him the problem was poor craftsmanship and the only way to fix it was to tear it all out. Richard did not fix the shower.
¶ 17 The plumber found other necessary repairs, including some he bеlieved violated health codes. A later inspection by the Illinois Department of Public Health found 21 violations. Richard also mentioned that shortly after moving in the family noticed an “excessively bad odor in the home.” Richard testified the odor was caused by a defective drain line from the furnace system.
¶ 18 Richard also stated he was aware of the letter from State Farm to defendant regarding settling on the property. Richard indicated after moving into the home he discovered shelving аnd a “plaster-type finish” covered cracks in the basement, some of which leaked water into the basement. Richard stated he believed defendant covered the cracks or knew they were
¶ 19 Richard and Rhonda called HelioTech to investigate the foundation and basement wall. HelioTech told Richard repairs would be very expensive. Richard stated he had documents from HelioTech detailing why the damage had occurred and specifically what repairs would be required.
4. Rhonda Messerly’s Deposition Testimony
¶ 21 Rhonda stated she called defendant about the leak in the basement bathroom. Defendant told her to take the ceiling tile (a drop-ceiling tile) off the top of the shower and get an extension on a wrench to tighten the pipe. Rhonda also testified she called defendant regarding a foul smell in the house. Defendant told her sometimes the hoses in the basement need to be changed out. These hoses came from the furnace and air conditioner. The plumber changed these hoses and “it got rid of the smell *** for a short time.” Like her husband, she stated cracks in the basement were covered with shelving and plaster.
C. The Parties’ Motions for Summary Judgment
¶ 23 Defendant filed a motion for summary judgment, arguing plaintiffs had not presented an issue of material fact concerning defendant’s failure to disclose material defects in the plumbing system. Defendant also argued he did not disclose any knowledge of mine subsidence on the property because he was advised by State Farm no mine subsidence occurred on the property. Defendant further argued plaintiffs had no evidence to show he failed to disclose foundation and subsidence issues.
¶ 24 Along with the motion for summary judgment, defendant filed an affidavit he authored, denying knowledge of material defects concerning the plumbing system of the home. Defendant stated, “pursuant to correspondence on or about October 30, 1991, [Stаte Farm] advised [defendant the Fund] had determined no mine subsidence event occurred on the property[;] however, the cracks in the basement floor were the result of settling.” Defendant also conceded he filed a claim with State Farm regarding cracks in the basement. Defendant strongly denied any “material defects or wrong doing concerning the property.”
¶ 25 Plaintiffs filed a response and cross-motion for summary judgment, arguing they had presented evidence demonstrating that, at closing, defendant had actual knowledge of material defects in the plumbing system. Plaintiffs requested summary judgment as to defendant’s liability for failing to disclose defects caused by settling, arguing defendant failed to answer question No. 17 on the disclosure from, which mentioned settling. Plaintiffs also argued defendant admitted State Farm advised him the Fund determined settling caused damages to the property.
D. The Trial Court’s Order
¶ 27 The trial court granted defendant’s motion for summary judgment, holding the record contained no evidence “defendant[ ] knowingly disсlosed false information or failed to disclose any known material defects in the residence.” The court also found defendant’s failure “to complete the [disclosure form] in full and the plaintiff[s’] acceptance of the disclosure form waives any action against the defendant[ ].” The court dismissed plaintiffs’ motion for summary judgment as moot.
¶ 28 This appeal followed.
A. Standard of Review
¶ 31 Under
¶ 32 “The purpose of a summary judgment proceeding is not to try issues of fact but is to determine whether any triable issues exist.” Id. at 577, 708 N.E.2d at 565-66. “A triable issue exists where there is a dispute concerning material facts or where those facts are undisputed but reasonable persons might draw different inferences from those facts.” Id. at 577, 708 N.E.2d at 566. The de novo standard of review applies to an order granting summary judgment. Id. at 576, 708 N.E.2d at 564.
B. Waiver
¶ 34 Defendant argues by accepting an incomplete disclosure form, plaintiffs waived any right to recovery based on the incomplete items. Plaintiffs argue the seller’s obligations under the Act cannot be waived, and we agree.
¶ 35 In Curtis Investment Firm, Ltd. Partnership v. Schuch, 321 Ill. App. 3d 197, 200, 746 N.E.2d 1233, 1236 (2001), the Third District held, “a buyer’s right to receive a disclosure statement prior to closing cannot be waived.” In Curtis, the sellers who failed to provide a disclosure form were liable for failing to disclose a defective water supply system, even though the buyer continued with the sale without the form. Id. at 200-01, 746 N.E.2d at 1237. The court noted, under section 20 of the Act:
” ‘A seller of residential real property shall complete all applicable items in the disclosure document described in Section 35 of this Act. The seller shall deliver to the prospective buyer the written disclosure statement required by this Act before the signing of a written agreement by the seller and prospective buyer that would, subject to the satisfaction of any negotiated contingencies, require the prospective buyer to accept a transfer of the residential real property.’ ” (Emphases added.) Id. at 199, 746 N.E.2d at 1236 (quoting
765 ILCS 77/20 (West 1998) ).
The court concluded the word ” ‘shall’ ” required “a mandatory reading of the provision,” noting the statute did not list any exceptions. Curtis, 321 Ill. App. 3d at 200, 746 N.E.2d at 1236.
¶ 36 Like the buyers in Curtis, plaintiffs did not waive their claim under the Act by continuing with the sale. While defendant supplied an incomplete disclosure form, omitting answers to question Nos. 17 through 22 rather than failing to submit any disclosure form, the court’s reasoning in Curtis applies.
¶ 38 Defendant argues the dissent in Curtis presents the more appropriate reasoning because “the incomplete items are not the basis fоr any factual defect that allegedly existed in the residence transferred between the parties.” As best we can discern, defendant argues plaintiffs have not shown settling exists as a material defect in the property. We disagree. Plaintiffs have shown settling of the foundation caused damage to the property. Both plaintiffs testified about the damages caused by the cracking in the wall and basement. Robert testified a contracting company, HelioTech, had investigated the dаmages and determined they would be expensive to repair. Defendant himself was concerned enough about the damage caused to file an insurance claim regarding the cracks.
¶ 39 We are not persuaded by the dissent in Curtis. The dissenting justice explained he would have found “the buyers waived the right to recovery under the Act” because the buyers had the right to terminate the contract yet proceeded with the transaction. Id. at 202, 746 N.E.2d at 1238 (Holdridge, J., dissenting). As the majority pointed out in Curtis, terminating the contract is not the buyer’s only right or remedy, as section 55 also “allows the buyer to suе the seller to recover actual damages and costs–the remedy sought by [plaintiff].” Id. at 200 n.1, 746 N.E.2d at 1236 n.1. Plaintiffs in this case also seek damages and costs. We follow the majority in Curtis and conclude plaintiffs have not waived the right to receive damages based on the incomplete disclosure form.
C. Defendant’s Liability Under the Act
¶ 41 Under
¶ 42 Plaintiffs argue the trial court erred in granting summary judgment in favor of defendant. First, plaintiffs allege the record evidence demonstrates a material issue of fact as to whether defendant knew about and failed to disclose defects in the home’s plumbing system. Second, plaintiffs argue they are entitled to summary judgment as there is no material issue of fact as to whether defendant knowingly failed to disclose defects in the home’s foundation caused by settling. We address each argument in turn.
1. Plumbing System Defects
¶ 44 Plaintiffs argue they presented evidence creating an issue of fact as to whether defendant knowingly failed to disclose
¶ 45 Generally, a defendant’s knowledge of a defect at the time of the closing is a question of fact to be determined by the trial court. Curtis, 321 Ill. App. 3d at 201, 746 N.E.2d at 1237. Further, “[a] trier of fact need not accept a party’s testimony that he had no knowledge of a particular fact in question if the evidence shows to the contrary.” Id. In Curtis, the Third District upheld the trial court’s finding a defendant, who denied any knowledge of defects in the water supply line to the home, had knowledge of the defect because he had the water turned off at the curb box, rаther than the meter inside the home. Id. Here, while defendant denied any knowledge of defects in the plumbing system in his affidavit, defendant’s denial is not definitive. As Curtis demonstrates, the case may still present an issue of fact if plaintiffs can present evidence to the contrary. See id.
¶ 46 In Woods, the Third District held the case presented material issues of fact as to defendant’s knowledge of a leak in a home’s roof where, prior to the sale, defendant had the roof repaired between three and five times in a four-year period. Woods, 303 Ill. App. 3d at 576-77, 708 N.E.2d at 565-66. The court in Woods overturned the trial court’s grant of summary judgment in favor of defendant because the evidence of the prior fixes “raise[d] at least an inference of a chronic condition that had never been permanently eliminated.” Id. at 576, 708 N.E.2d at 565.
¶ 47 In this case, plaintiffs have presented evidence raising a question of fact as to defendant’s knowledge at closing of a material defect in the plumbing system. At her deposition, Rhonda testified that within a few days of moving into the hоme her children attempted to use the shower and noticed water leaking from the junction of an interior wall and the floor located behind the shower. Rhonda contacted defendant about the leak and he told her to “take off the ceiling tile off the top of the shower and get an extension on a wrench to go in and tighten the pipe up.” Rhonda clarified he was describing the pipe inside the wall leading to the showerhead. Just as the defendant’s repeated prior аttempts to fix his roof created an inference of a chronic condition in Woods, defendant’s statement raises at least an inference defendant had specific knowledge of the leak at closing.
¶ 48 Defendant argues “the need to tighten the showerhead *** hardly could be classified as a material defect.” We disagree. Whether a shower leaking into an interior wall constitutes a material defect is an issue of fact. Plaintiffs have presented evidence this leak is material. Both plaintiffs testified the leak allowed water to enter into an interior wall. Richard testified a plumber investigated the leak and concluded the only way to fix it was to remove and reinstall the pipes going to the bathroom, and stated such repairs would be expensive. Based on this evidence, a trier of fact could find this defect material.
¶ 49 Plaintiffs also argue defendant had knowledge of faulty pipes ventilating the heating and air conditioning systems. Rhonda testified defendant described to her how to fix a foul odor in the basement by replacing hoses coming from the heating and air conditioning systems. Defendant argues the complaint limited its allegations to defects in the plumbing system and unstable foundation and walls, and a faulty ventilation system does not constitute a factual description of a material defect in the plumbing system. Richard testified a contractor determined the smell
2. Foundation Defects
¶ 51 As to the foundation defects, both parties have moved for summary judgment. “By filing cross-motions for summary judgment, the parties agree that no factual issues exist and this case turns solely on legal issues ***.” Gaffney v. Board of Trustees of the Orland Fire Protection District, 2012 IL 110012, ¶ 73, 969 N.E.2d 359. “However, the mere filing of cross-motions for summary judgment does not establish that there is no issue of material fact, nor does it obligate a court to render summary judgment.” Pielet v. Pielet, 2012 IL 112064, ¶ 28, 978 N.E.2d 1000. We conclude an issue of fact exists as to this issue.
¶ 52 Plaintiffs argue by not answering question No. 17, defendant failed to comply with his duty under the Act as he had actual knowledge settling affected the home. See
¶ 53 Defendant argues his affirmative answer to question No. 4, indicating he was aware of material defects in the basement or foundation, satisfied his duty to disclose defects related to cracks in the basement. We disagree. A seller who discloses some information can be subject to liability under the Act if the seller knows the information disclosed contains a material error, inaccuracy, or omission. Hogan v. Adams, 333 Ill. App. 3d 141, 147, 775 N.E.2d 217, 222 (2002) (citing
¶ 54 Here, the trier of fact could find defendant’s explanation, “no damage from water in basement from crack,” equally incomplete and misleading. The word “crack” used in the disclosure form is singular, indicating there was only one crack, while defendant аcknowledged in his affidavit he made an insurance claim based on “cracks” occurring in the foundation. This distinction is significant because one crack might indicate an isolated incident, while the existence of more might put a plaintiff on notice of a more serious defect. Defendant’s description is even more misleading in light of facts presented suggesting many of the cracks in the basement wall were covered by shelving and a plaster-like material, as plaintiffs could not have observed the full extent of the cracking. Defendant’s description could be incomplete because
¶ 55 Further, defendant’s answer to question No. 4 does not excuse his failure to answer question No. 17, because the clear language of the Act requires a seller to answer both questions if both apply (see
¶ 56 Defendant also argues, without citation to any authority, plaintiffs must show a “causal connection” between the damages they allegedly suffered and defendant’s leaving question No. 17 blank to establish liability under the Act. Plaintiffs are not required to show causation to establish liability, as the plain language of the Act subjects sellers who fail to comply with a duty under the Act to mandatory liability. Curtis, 321 Ill. App. 3d at 200, 746 N.E.2d at 1236. While causation of damages may be relevant to the amount of damages (see
¶ 57 Last, defendant argues no evidence suggests settling affects the premises because at the deposition, when asked what evidence he had related to the unstable condition of the foundation and the walls, Richard responded, ” ‘I am not sure of any.’ ” This argument takes Richard’s statement out of context, as he was responding to the question ” ‘what other evidence do you have [defendant] did not disclose proper information on paragraph [No.] 17 other than what is in [the letter from State Farm]?’ ” (Emphases added.) A negative response to this question simply does not amount to “an admission [plaintiff] was not sure of any evidence of defects of the foundation and wall,” as defendant argues. In their depositions, plaintiffs described the damage caused by cracks and Richard stated contractors from HelioTech have evaluated the damages and provided estimates as to the costs of repairs.
¶ 58 We conclude an issue of fact exists as to defendant’s knowledge of the foundation defects at the time of the closing.
III. CONCLUSION
¶ 60 For the reasons stated, we reverse the trial court’s judgment.
¶ 61 Reversed.