Shaun Weinstock and David Sarif bought condominiums on the south side of Twelve Atlantic Station (“Twelve”), a residential tower located in Atlanta. Weinstock and Sarif contend that defendants Novare Group, Inc. and its alleged affiliates 1 (collectively, “Novare”), who marketed and sold Twelve, were involved in a scheme to sell and advertise condominiums at Twelve as having spectacular city views while intending to block those same views by later constructing The Atlantic, a 46-story tower, on a lot directly south of Twelve. In their complaint, as amended, Weinstock and Sarif sued Novare raising claims of negligent misrepresentation, fraud in the inducement, negligent supervision, breach of implied easement rights, and violation of the Georgia Fair Business Practices Act, OCGA § 10-1-390 et seq. (FBPA). The trial court granted summary judgment to Novare on all claims, from which Weinstock and Sarif appeal. We affirm. Weinstock and Sarif, who did not timely rescind their purchases, *352 could not justifiably rely on representations that were not made in their purchase contracts. The claim of fraudulent inducement, as couched by Weinstock and Sarif, does not support the conclusion that Novare induced the sale by concealing a defect in the property. Novare successfully pointed to a lack of evidence to create an issue of material fact on the claims of negligent supervision and breach of implied easement rights. Lastly, we agree with the trial court that the FBPA claim is barred by the statute of limitation.
Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. On appeal from the grant or denial of a motion for summary judgment, this Court must conduct a de novo review of the evidence and view the undisputed facts in the light most favorable to the nonmoving party.
(Footnotes omitted.)
ChoicePoint Sucs. v. Graham,
So viewed, the evidence shows that in 2006 Weinstock and Sarif each bought a residential condominium unit on the south side of Twelve from defendant WN Atlantic Properties, LLC. Novare Group, WN Atlantic, and the other defendants were involved in the marketing and sale of Twelve condominiums.
Twelve is a 26-story building which Novare marketed as having “spectacular city views.” Novare knew that at the time of marketing and selling of condominiums at Twelve that The Atlantic would be constructed south of Twelve and would obstruct views of the Atlanta skyline, but Novare did not disclose this fact to Weinstock and Sarif, who contend that they paid a premium for the view. Upon construction, The Atlantic obstructed the view of downtown Atlanta from Weinstock’s and Sarif s condominiums.
Novare also knew that real estate agents would be asked about future development on the building pads located around the property, including the pad where The Atlantic was to be constructed. The sales agents were directed to respond to questions about whether the building would be developed and how high it might be as follows:
It is likely that all of the building lots around our building will be developed. No developments have been announced, and the timing is uncertain. They could be developed at any point in the future. There is not [sic] height limit on buildings which could be developed on those sites.
Weinstock and Sarif deposed that in response to direct question- *353 mg, real estate agents represented that the development on the property where The Atlantic is now located would be a low to mid-rise building and would not be constructed for five years.
1. Weinstock and Sarif contend that the trial court erred in granting summary judgment to Novare on Weinstock’s and Sarif s negligent misrepresentation claim. We disagree.
(a) Justifiable reliance is an essential element of negligent misrepresentation.
Real Estate Intl. v. Buggay,
(b) Weinstock and Sarif argue that because they sought to rescind the purchase contracts that they need not be restricted to reliance upon representations made within the purchase contracts themselves. “It is inconsistent to apply a disclaimer provision of a contract in a tort action brought to determine whether the entire contract is invalid because of alleged prior fraud which induced the
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execution of the contract.”
City Dodge v. Gardner,
“In general, a party alleging fraudulent inducement to enter a contract has two options: (1) affirm the contract and sue for damages from the fraud or breach; or (2) promptly rescind the contract and sue in tort for fraud.” (Citation omitted.)
Ekeledo v. Amporful,
We have generally found that a claim for damages unaccompanied by a claim for rescission operates as an election to affirm the underlying contract.
Megel,
supra,
In
Conway,
the plaintiffs did not set forth a specific rescission claim in their original complaint, but they asserted their intent to rescind in a timely fashion before filing their action, they noted the rejection of their tender in the complaint, and they even attached the letter of rescission thereto.
Conway,
supra,
In light of the foregoing, we conclude that the trial court did not err in awarding summary judgment to Novare on Weinstock’s and Sarif s negligent misrepresentation claim.
2. Weinstock and Sarif claim that the trial court erred in granting summary judgment to Novare on their claim for fraudulent inducement. As we found in Division 1 (b), supra, Weinstock and Sarif affirmed their pürchase contract and did not “promptly rescind” the agreements. “[WJhere the allegedly defrauded party affirms a contract which contains a merger or disclaimer provision and retains the benefits, he is estopped from asserting that he relied upon the other party’s misrepresentation and his action for fraud must fail.” (Citations and punctuation omitted.)
Ekeledo,
supra,
Weinstock and Sarif point out that their fraudulent inducement claim alleges Novare’s active and passive concealment of a defect in the property. Therefore, they contend, the trial court erred in relying on the contract’s merger clause in analyzing this claim.
[WJhere a buyer affirms the sales contract and sues claiming, not that the seller made extracontractual oral or written misrepresentations about the purchased property, *357 but that the seller actively or passively concealed damage or defects in the purchased property, there is no basis for using an entire agreement clause in the sales contract as a defense to the suit.
Browning v. Stocks,
3. Weinstock and Sarif challenge the trial court’s findings of a lack of evidence to support their claim for negligent supervision. They contend that Novare failed to satisfy its burden on this issue because it failed to present evidence to negate an essential element of a negligent supervision claim. However,
[a] defendant who does not bear the burden of proof at trial need not produce evidence or disprove the plaintiffs claim on summary judgment. Rather, the defendant meets its summary judgment burden by pointing out by reference to the affidavits, depositions and other documents in the record that there is an absence of evidence to support the plaintiffs case.
(Punctuation and footnotes omitted.)
Grossman v. Brown & Webb Builders,
Weinstock and Sarif also contend that there was evidence of record to support a negligent supervision claim. “An employer may be held liable for negligent supervision only where there is sufficient evidence to establish that the employer reasonably knew or should have known of an employee’s tendencies to engage in certain
*358
behavior relevant to the injuries allegedly incurred by the plaintiff.” (Punctuation and footnote omitted.)
Leo v. Waffle House, Inc.,
4. Weinstock and Sarif contend that the trial court erred in granting summary judgment to Novare on their claim for breach of implied easement rights. This claim rests upon the theory that Novare violated their implied easement rights under OCGA § 44-9-2
6
and common law by construction of The Atlantic. Novare has pointed to an absence of a material issue of fact as to the application of OCGA § 44-9-2. The Atlantic was constructed on a lot which was owned by Atlantic Station LLC, not WN Atlantic, at the time that Weinstock and Sarif bought their condominiums. Moreover, the lot was separated from Twelve by 17th Street. The easement contemplated by OCGA § 44-9-2 only arises when “a person sells a house and the light necessary for the reasonable enjoyment thereof is derived from and across adjoining land
belonging to such
person.” (Emphasis supplied.) See
Goddard v. Irby,
5. Lastly, Weinstock and Sarif contend that the trial court erred in granting summary judgment to Novare on their FBPA claims (i) because their cause of action was not barred by the statute of limitation and (ii) because Weinstock and Sarif could show that they justifiably relied on the representations made in violation of the FBPA. 8 We agree with the trial court that the FBPA claims were barred by the statute of limitation. Accordingly, we do not reach the issue of justifiable reliance for purposes of the FBPA.
“[N]o action shall be brought [under the FBPA] . . . [m]ore than two years after the person bringing the action knew or should have known of the occurrence of the alleged violation[.]” OCGA § 10-1-401 (a) (1). This language requires consideration of “the timing of the alleged FBPA violation and whether [Weinstock and Sarif] exercised due diligence in discovering it.”
Tiismann v. Linda Martin Homes Corp.,
The alleged violations of the FBPA occurred before Weinstock and Sarif closed on their condominiums in February 2006. They filed the original complaint on April 24, 2008, alleging, among other things, that on March 31, 2006, the Atlanta Business Chronicle published an article outlining Novare’s plans to build a 40-50 story condominium tower known as The Atlantic. They do not dispute *360 they were aware of the article at that time. Weinstock and Sarif contend, however, that they could not have successfully maintained an action for unlawful and deceptive practices until Novare constructed The Atlantic and blocked the advertised “spectacular city views.” This occurred, they argue, no earlier than February or March 2007, when Novare broke ground on The Atlantic’s development site. Alternatively, Weinstock and Sarif maintain that the statute of limitation did not run on their FBPA claim because Novare concealed its wrongful scheme through fraud and deceit. See OCGA § 9-3-96 (“If the defendant or those under whom he claims are guilty of a fraud by which the plaintiff has been debarred or deterred from bringing an action, the period of limitation shall run only from the time of the plaintiffs discovery of the fraud”).
Weinstock’s and Sarif s FBPA claims are analogous to those of other consumers who contend that they paid for something other than what they received due to a seller’s deceptive business practices. They claim, in effect, that they “paid a premium price for a [condominium with spectacular views] and got a much less valuable [condominium] instead.”
Johnson v. GAPVT Motors, Inc.,
Further, Weinstock and Sarif do not dispute knowledge of the article disclosing Novare’s plans to build The Atlantic in March 2006, at which time any reasonable person would have realized that their views of the city were at risk. In light of the media reports, Weinstock and Sarif “knew or should have known of the occurrence of the alleged violation,” OCGA § 10-1-401, more than two years before they filed suit. “Once [Weinstock and Sarif] learned of this potential problem, they were obligated to exercise reasonable diligence to protect their interest in their home and their legal rights.”
Scully v. First Magnolia Homes,
Weinstock’s and Sarif s argument that fraud tolled the statute of
*361
limitation is without merit. “The fraud which tolls a statute of limitation must be such actual fraud as could not have been discovered by the exercise of ordinary diligence.” (Citations and punctuation omitted.)
Fuller v. Dreischarf,
Judgment affirmed.
Notes
The other defendants are Atlantic WN Properties, Inc., Novare Group Holdings, LLC, Twelve Hotels and Residences, LLC, and WN Atlantic Properties, LLC.
The contracts provide:
This agreement contains the entire agreement between the parties hereto. No agent, representative, salesman or officer of the parties hereto has authority to make, or had made, any statements, agreements, or representations, either oral or in writing, in connection herewith, modifying, adding to, or changing the terms and conditions hereof and neither party has relied upon any representation or warranty not set forth in this Agreement. No dealings between the parties or customs shall be permitted to contradict, vary, add to, or modify the terms hereof.
Their claims for negligent misrepresentation, negligent supervision, and breach of implied easement rights were added in a second amended complaint, filed on May 26, 2009.
Although there are some overlapping parties, facts, and theories of recovery between this appeal and Sarif which also involves fraud claims by purchasers of condominiums in Twelve, Sarif is a separate civil action. In that case, we reviewed an appeal from the grant of a motion on the pleadings and “construefd] the complaint in a light most favorable to the appellant[s], drawing all reasonable inferences in [their] favor.” Id. at 742. (Citation and punctuation omitted.) So construed, appellants had notified appellees of their intent to rescind their purchases before fifing the complaint, and we concluded that the appellants had not affirmed their purchase contracts for purposes of a judgment on the pleadings. Id. at 744 (1) (a). Here, both the standard of review and the facts, as developed for purposes of the motion for summary judgment, differ from those in Sarif.
Weinstock and Sarif argue that whether they timely rescinded the purchase agreement was irrelevant because “a party need not tender back what he is entitled to keep, and need not offer to restore where the defrauding party has made restoration impossible, or when to do so
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would be unreasonable.”
Orion Capital Partners, L.P. v. Westinghouse Elec. Corp.,
OCGA § 44-9-2 provides:
A right to an easement of light and air passing over another’s land through existing lights or windows may not be acquired by prescription; but, when a person sells a house and the light necessary for the reasonable enjoyment thereof is derived from and across adjoining land belonging to such person, the easement of light and air over such vacant lot shall pass as an incident to the house sold as being necessary to the enjoyment thereof.
After Novare pointed out that the record showed a lack of common ownership of the two lots, Weinstock and Sarif failed to come forward with evidence that would give rise to a triable issue of fact. Weinstock and Sarif did allege below that they would pierce the corporate veil, but they did nothing to show that the separateness of the corporate entities should be disregarded. Further, even if we agreed with Weinstock and Sarif that there remained an issue as to
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common ownership, an implied easement for a view of downtown Atlanta could not have arisen under the terms of the purchase contracts. “The introduction of an implied term into the contract of the parties can only be justified when the implied term is not inconsistent with some express term of the contract!.]” (Citation, punctuation and emphasis omitted.)
Higginbottom v. Thiele Kaolin Co.,
Weinstock and Sarif also contend that the trial court erred in finding the FBPA was pre-empted by the Georgia Condominium Act, OCGA § 44-3-111 et seq. The trial court did not directly address the issue but assumed the FBPA applied. Novare does not contest the issue for purposes of this appeal.
According to Weinstock’s and Sarif s complaint, “upon public disclosure of [Novare’s] plans to build The Atlantic, the value of south side condominiums would be significantly diminished.”