Goodfield v. Frahm CA4/3 ( 2021 )

Filed 9/10/21 Goodfield v. Frahm CA4/3
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION THREE
BRUCE GOODFIELD, et al.,
Plaintiffs and Appellants, G059551
v. (Super. Ct. No. 30-2019-01050047)
DANIEL A. FRAHM, et al., OPINION
Defendants and Respondents.
Appeal from a judgment of the Superior Court of Orange County, Gregory
H. Lewis, Judge. Reversed.
Wright, Finlay & Zak, Jonathan D. Fink and Charles C. McKenna for
Plaintiffs and Appellants.
Van Ripper Law and David A. Van Riper for Defendants and Respondents.
This case concerns the disclosure obligations of a residential property
seller. Plaintiffs Bruce Goodfield and Kerry Goodfield (buyers) appeal from a summary
judgment granted in favor of defendants Daniel A. Frahm and Claire Frahm (sellers).
The trial court concluded sellers’ disclosure of prior pool crack repairs was sufficient, as
a matter of law, to satisfy their duty to disclose all pool-related material facts affecting
the value or desirability of the property. Buyers contend the court erred because the
evidence demonstrated triable issues of material fact as to whether sellers failed to
disclose other pool-related material facts known only to them. They point to documents
produced by sellers during discovery, which allegedly notified them for the first time of
more extensive repair work previously performed on the pool, an ongoing pool leak, and
other serious pool-related problems. We agree the grant of summary judgment to
defendants was erroneous. The record is rife with triable issues of material fact, and,
separately, sellers failed to meet their initial summary judgment burden regarding buyers’
cause of action for statutory disclosure violations. Accordingly, the judgment is reversed.
FACTS
Sellers listed their single-family home (property) for sale. It had a
backyard pool and spa. Buyers offered to buy the property, sellers accepted the offer, and
the parties opened escrow. Sellers were represented by an agent (sellers’ agent); Kerry
Goodfield,1 a licensed real estate agent, acted as buyers’ agent.
While in escrow, Kerry performed a visual inspection of the property
pursuant to state law and prepared a report. With respect to the pool, the report noted
there were “cracks in [the] pool[.]” It also stated the backyard wall was “tilt[ed] to [the]
back slope[.]”
Less than one week later, sellers’ agent performed a visual inspection of the
property pursuant to state law and prepared a report. The only mention of the pool in the
1 When the context requires, we use the parties’ first names only for the sake of
clarity; no disrespect is intended.
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report was a recommendation for “buyer to satisfy themselves as to all plumbing and pool
repairs.” Separately, the report advised the buyers “to have the home and grounds
inspected by a [g]eotechnical [e]ngineer.”
On the same day sellers’ agent inspected the property, Bruce received from
sellers a copy of a written Seller Property Questionnaire. The form’s stated purpose was
“to tell the [b]uyer about known material or significant items affecting the value or
desirability of the [p]roperty and help to eliminate misunderstandings about the condition
of the [p]roperty.”
In a section titled “Landscaping, Pool and Spa,” sellers checked a box
stating they were aware of “[p]ast or present defects, leaks, cracks, repairs or other
problems with the . . . pool [or] spa . . . including any ancillary equipment, . . . even if
repaired.” Immediately thereafter in an “explanation” area, sellers handwrote the
following: “POOL HEATER REPLACED MORE THAN 5 YEARS AGO[;] POOL
CRACKS PROMPTLY REPAIRED[.]”
Within a different section of the Seller Property Questionnaire, titled
“Repairs and Alterations,” sellers checked a box indicating they were aware of
“alterations, modifications, replacements, improvements, remodeling or material repairs
on the [p]roperty[.]” In the explanation area directly below, they handwrote the
following: “POOL CRACKS & PLUMBING REPAIRS[.]”
Elsewhere on the Seller Property Questionnaire, sellers checked a box
specifying they were aware of “[r]eports, inspections, disclosures, warranties,
maintenance recommendations, estimates, studies, surveys or other documents pertaining
to (i) the condition or repair of the [p]roperty or any improvement on [the] [p]roperty in
the past, now or proposed; or (ii) easements, encroachments or boundary disputes
affecting the [p]ropety whether oral or in writing and whether or not provided to the
[s]eller[.]” The form recited that if this box was marked “yes,” then any such documents
in sellers’ possession would be provided to buyers.
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Sellers also represented to buyers on the Seller Property Questionnaire that
sellers were not aware of (1) any “[m]aterial facts or defects affecting the [p]roperty not
otherwise disclosed to [b]uyer”; or (2) “[a]ny past or present known material facts or
other significant items affecting the value or desirability of the [p]roperty not otherwise
disclosed to [b]uyer[.]”
Over the course of the following month, buyers posed to sellers two
questions concerning the pool. The first question asked, “Regarding pool cracks: can
you advise when this was repaired and what company did the work?” Sellers provided
the name of the company and said it “performed the most recent repairs within the last 1
or 2 years, as well as other repairs going back as far as 10 years.” Appearing to believe
sellers’ first response only provided information concerning leak detection for the pool,
buyers followed up with a second question asking for the name of whomever filled the
cracks in the pool. Sellers responded by providing an invoice for the then most recent
pool crack repair ($175) and leak detection ($300), both of which were performed by the
same company roughly three months prior.
Buyers reached out to the company who performed the pool crack repairs
and leak detection, attempting to get copies of relevant documents. The company
indicated it did not have any information in its files concerning the subject pool. Neither
buyers nor buyers’ agent tried to get the relevant documents from sellers prior to close of
escrow.
After escrow closed, buyers learned from a then short-term tenant on the
property that the pool had been losing water and the water level was decreasing “very,
very quickly.” The tenant told them sellers’ agent reassured her buyers were aware of the
pool leak.
Buyers then hired the company who did the pool leak detection and crack
repair work to inspect the pool. Upon arrival, the inspector told Kerry he had been to the
property “‘many times’” and performed numerous repairs.
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According to buyers, other companies also came out to inspect the pool and
provide recommendations. They informed buyers the pool problems were not fixable and
the pool had to be replaced. Buyers obtained replacement cost estimates from five
different companies, ranging from approximately $191,000 to $264,000.
Buyers sued sellers, alleging breach of contract, breach of the covenant of
good faith and fair dealing, intentional misrepresentation and concealment, negligent
misrepresentation, failure to make required statutory disclosures and general negligence.
Each cause of action was grounded in sellers’ purported failure to disclose the true nature
and extent of the pool-related problems and prior repairs.
Sellers moved for summary judgment, or in the alternative, summary
adjudication on each cause of action. Their sole contention was buyers could not prevail
on any of their claims, as a matter of law, because sellers did not fail to disclose any
material fact.
Buyers opposed the motion and argued there were multiple triable issues of
material fact concerning whether sellers satisfied their disclosure obligations. Among
other evidence, buyers submitted the documents which they first became aware of when
they received sellers’ discovery responses. The documents included invoices, proposals
and reports from various companies who had inspected and/or performed work on the
pool for sellers over the course of a decade.
Some of the invoices concerned leak detection and crack patching, while
other invoices reflected replastering the pool and spa, and saw cutting and insertion of
steel rebar in the pool.
One of the proposals, dated a few months prior to close of escrow,
concerned geotechnical services for a pool and spa repair and remodel contemplated by
sellers. At the outset, the proposal stated: “We understand that your existing swimming
pool has experienced distress. Distress is in the form of pool shell rotation and cracks in
the plaster. It is also your suspicion that the pool may be leaking water. The cause of the
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distress is unknown, but is likely related to slope-creep effects and possibly fill
settlement.” It went on to propose services to determine the subsurface conditions under
the pool and original design construction so proper pool repair design recommendations
could be made.
The documents also included a series of e-mails exchanged between Daniel
and a pool engineer. The e-mails, dated a few months prior to the opening of escrow
with buyers, indicated sellers were “contemplating a ‘pool within a pool’ repair” which
might necessitate installation of two new footings to supplement one footing sellers had
installed during a prior repair. Daniel also explained he was aware (1) their property had
“slope creep,” having been told so “on several occasions, (2) the pool water line was
“probably at least 1/2[ inch] out of alignment[,]” and (3) there was “some separation of
deck from pool.” Sellers stated goal was “to reinforce the pool and prevent further creep,
as recommended [by another company.]”
Kerry submitted a declaration in support of buyers’ opposition to the
summary judgment motion which explained that prior to the close of escrow, she was not
aware of the saw cut and rebar work or the added footing and replastering work
performed on the pool. Unlike the crack repairs which were visible to her when standing
next to the pool, the other repair work was not visible. She indicated buyers would not
have purchased the property had sellers provided all the pool-related disclosures. She
elsewhere stated they most likely would have canceled escrow and not gone forward with
the purchase, but in the very least, they would have negotiated for a substantial price
reduction.
Following a hearing on sellers’ motion, the trial court granted summary
judgment in their favor. Citing Pagano v. Krohn 60 Cal.App.4th 1 (Pagano), it
concluded any additional information about past pool repairs would simply have been an
elaboration of details concerning the disclosures made by sellers, meaning as a matter of
law sellers had met their disclosure obligations.
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Buyers timely appealed following entry of judgment.
DISCUSSION
Buyers contend the trial court erred in granting summary judgment in favor
of sellers because there were triable issues of material fact concerning whether sellers
satisfied their disclosure obligations in relation to the pool. We agree.
A. Summary judgment principles and standard of review
“[A]ny party to an action, whether plaintiff or defendant, ‘may move’ the
court ‘for summary judgment’ in his favor . . . .” (Aguilar v. Atlantic Richfield Co.
(2001) 25 Cal.4th 826, 843 (Aguilar).) “The court must ‘grant[ ]’ the ‘motion’ ‘if all the
papers submitted show’ that ‘there is no triable issue as to any material fact’ . . . and that
the ‘moving party is entitled to a judgment as a matter of law.’” (Ibid., citations omitted.)
“‘The summary judgment procedure, inasmuch as it denies the right of the adverse party
to a trial, is drastic and should be used with caution.’” (Osborn v. Hertz Corp. (1988)
205 Cal.App.3d 703, 708.)
The party opposing summary judgment may defeat the motion by
demonstrating there is one or more triable issues of material fact. (Aguilar, supra, 25
Cal.4th at p. 849.) He or she “‘may not rely upon the mere allegations or denials’ of [the]
‘pleadings to show that a triable issue of material fact exists but, instead,’ must ‘set forth
the specific facts showing that a triable issue of material fact exists as to [the challenged]
cause of action . . . .’” (Ibid.)
“‘On review of an order granting or denying summary judgment, we
examine the facts presented to the trial court and determine their effect as a matter of
law.’ [Citation.] . . . Evidence presented in opposition to summary judgment is liberally
construed, with any doubts about the evidence resolved in favor of the party opposing the
motion. [Citation.]” (Regents of University of California v. Superior Court (2018) 4
Cal.5th 607, 618.) Credibility determinations and the weighing of evidence are not
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proper matters. (Kids’ Universe v. In2Labs (2002) 95 Cal.App.4th 870, 880; ARTS
Productions, Inc. v. Crocker National Bank (1986) 179 Cal.App.3d 1061, 1065.)
Similarly, there is to be no resolving of fact issues. (Calemine v. Samuelson (2009) 171
Cal.App.4th 153, 161 (Calemine).)
“[T]he trial court’s stated reasons for granting summary judgment ‘are not
binding on us because we review its ruling, not its rationale.’” (Johnson v. Open Door
Community Health Centers (2017) 15 Cal.App.5th 153, 157.) We affirm the summary
judgment if correct on any of the grounds asserted in the moving party’s motion.
(American Meat Institute v. Leeman (2009) 180 Cal.App.4th 728, 747-748.)
B. Disclosure obligations of a seller of real property
Sellers’ summary judgment motion challenged all of buyers’ claims on one
basis: as a matter of law, buyers could not establish sellers failed to comply with their
disclosure obligations. Because the trial court apparently agreed, we focus our analysis
on the law relating to a real estate seller’s duty of disclosure. “‘A real estate seller has
both a common law and statutory duty of disclosure.’” (RSB Vineyards, LLC v. Orsi
(2017) 15 Cal.App.5th 1089, 1097 (RSB Vineyards).) We will discuss each in turn.
1. Common law disclosure duties
“‘“In the context of a real estate transaction, ‘[i]t is now settled in
California that where the seller knows of facts materially affecting the value or
desirability of the property . . . and also knows that such facts are not known to, or within
the reach of the diligent attention and observation of the buyer, the seller is under a duty
to disclose them to the buyer. [Citations.]’ [Citations.] Undisclosed facts are material if
they would have a significant and measurable effect on market value.
[Citation.]” . . . Where a seller fails to disclose a material fact, he may be subject to
liability “for mere nondisclosure since his conduct in the transaction amounts to a
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representation of the nonexistence of the facts which he has failed to disclose [citation].”
[Citation.]’” (RSB Vineyards, supra, 15 Cal.App.5th at p. 1097.)
It is undisputed sellers disclosed prior pool crack repairs. Buyers contend
there was more that should have been disclosed. They argue sellers were obligated to tell
them about (1) the more extensive work previously performed on the pool, including
installation of a footing, saw cutting and insertion of steel rebar, and replastering on more
than one occasion; (2) the pool shell rotation and slope creep; and (3) the then existing
pool leak.
Sellers do not deny knowledge of these additional matters, but instead
argue they were not obligated to disclose them. Relying on Pagano, they claim the
additional information would simply have elaborated upon and provided further detail
about the facts they did disclose, meaning it fell outside the scope of their disclosure
duty. We are not persuaded.
Pagano is inapposite. In that case, a buyer purchased a condominium and
the seller’s agent disclosed a past water intrusion problem that affected certain other units
in the condominium complex. (Pagano, supra, 60 Cal.App.4th at p. 5.) After
discovering water-related damage in the purchased condominium, the buyer sued and
claimed the seller’s agent and the seller failed to disclose newsletters and other
documents which chronicled the water intrusion issues, severe water intrusion problems
experienced by three other owners and a copy of the complaint against the developer.
(Id. at pp. 6, 8-9.) The Court of Appeal disagreed. As to the statutory disclosure
obligations of the seller’s agent, the court concluded the agent satisfied its duty. (Id. at
pp. 9-10.) The additional facts buyer claimed should have been disclosed “would have
served only as elaboration” on the basic disclosed fact of water intrusion resulting in
litigation against the developer. (Id. at p. 9.) Additionally, the court explained there was
no evidence showing the seller’s agent or the seller would have had reason to believe the
subject condominium would likely experience the same problems as other units. (Ibid.)
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To the extent the claims against the seller were based on the imputed knowledge of the
seller’s agent, the court found the same reasoning applicable. (Id. at p. 10.)
Here, we are not concerned with (1) the statutory duty of a seller’s agent to
“conduct a reasonably competent and diligent inspection and disclose all material facts
such an investigation would reveal” (Pagano, supra, 60 Cal.App.4th at p. 8); (2)
information that relates to properties other than the one purchased by buyers; or (3)
information that simply elaborates on disclosed facts. With respect to the latter, and
contrary to sellers’ assertions, they did not disclose a “defective” pool or “the existence
of an aged, unlevel hillside pool with a long-term history of cracking and ‘material
repairs.’” All they disclosed were pool crack repairs.
Sellers do not otherwise contest the materiality of the undisclosed facts.
Even if they did, whether undisclosed facts are of sufficient materiality to affect the value
or desirability of the property is a factual determination for the trier of fact. (Shapiro v.
Sutherland (1998) 64 Cal.App.4th 1534, 1544; Alexander v. McKnight (1992) 7
Cal.App.4th 973, 977 (Alexander).) And on that point, buyers submitted evidence the
pool’s structural problems could not be fixed. A house with a structurally sound pool and
a house with an irreparable structurally defective pool are two very different things.
Aside from materiality, sellers contend buyers could not establish a triable
issue of fact concerning other matters which sellers claim are prerequisites to finding a
seller disclosure duty. Specifically, sellers assert undisputed facts demonstrated (1)
buyers knew or had reason to know about the undisclosed facts; (2) the undisclosed facts
were within the “diligent attention” (RSB Vineyards, supra, 15 Cal.App.5th at p. 1097) of
buyers; (3) sellers did not know buyers could not learn of the undisclosed facts through
diligent attention; and (4) sellers did not actually and justifiably rely on sellers’
omissions.
Before reaching the merits of these arguments, we must note something
sellers overlook. The additional matters they raise are elements relevant to causes of
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action for intentional misrepresentation and/or negligent misrepresentation. (See Alliance
Mortgage Co. v. Rothwell (1995) 10 Cal.4th 1226, 1239 fn. 4 [justifiable reliance is an
element of intentional misrepresentation and negligent misrepresentation]; Barnhouse v.
City of Pinole (1982) 133 Cal.App.3d 171, 190-191 & fn. 7 [elements of fraudulent
concealment]; Lingsch v. Savage (1963) 213 Cal.App.2d 729, 738 [elements of fraud
based on nondisclosure].) As argued, they have no import on the viability of the other
causes of action alleged against them, including breach of contract, breach of covenant of
good faith and fair dealing, failure to make statutorily required disclosures and general
negligence. (See Civ. Code, §§ 1102-1102.19 [disclosures upon transfer of residential
property]; Miles v. Deutsche Bank National Trust Co. (2015) 236 Cal.App.4th 394, 402
[breach of contract]; Thrifty Payless, Inc. v. The Americana at Brand, LLC (2013) 218
Cal.App.4th 1230, 1244 [covenant of good faith and fair dealing]; Newhall Land &
Farming Co. v. Superior Court (1993) 19 Cal.App.4th 334, 349 [negligence].) Thus,
summary judgment was improper and the most the trial court could have potentially
awarded sellers was summary adjudication.
Even so, the evidence demonstrates triable issues of material fact as to each
of the additional matters.
With respect to buyers’ knowledge, a buyer cannot prevail in a
nondisclosure suit against a seller if the facts were known to, or within the diligent
attention and observation of the buyer. (RSB Vineyards, supra, 15 Cal.App.5th at p.
1097; Buist v. C. Dudley De Velbiss Corp. (1960) 182 Cal.App.2d 325, 31.) Sellers argue
buyers “must be deemed by law to have known this pool was defective” because buyer’s
agent (1) made written observations of “cracks in pool” and that “wall tilts to back
slope”; and (2) admitted in a deposition she could see “it was an older pool[,]” “the
backyard adjoined a slope[,]” there were “cracks in the pool deck[,]” and there were
“uneven joints in the pool coping.”
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However, what facts were known to the buyer in a particular case and what
facts were within the buyer’s diligent attention and observation are factual matters to be
resolved by the trier of fact. (Northwestern Portland Cement Co. v. Atlantic Portland
Cement Co. (1917) 174 Cal. 308, 312; Sanfran Co v. Rees Blow Pipe Manufacturing Co.
(1959) 168 Cal.App.2d 191, 202.) And, here, there was conflicting evidence. Buyers
stated they had no actual knowledge of the more extensive pool repairs or structural
problems due to slope creep, and Kerry stated none of the undisclosed conditions could
be seen during her agent visual inspection or at any other time. This is arguably
corroborated by sellers’ agent’s visual inspection which did not note any observation of
the undisclosed pool repairs or geotechnical engineering issues.
Sellers go one step further, arguing the true condition of the pool was
within buyers’ diligent attention because sellers would have provided the undisclosed
documents had buyers asked. Such an argument turns a seller’s obligation on its head. A
seller could always prevail in a nondisclosure suit simply by declaring they would have
disclosed the information if the buyer had asked. That is not the law. A seller’s duty to
disclose exists, in large part, because of a seller’s superior knowledge. (See Garrett v.
Perry (1959) 53 Cal.2d 178, 181.) It is not dependent upon a buyer’s prescience in
asking the right questions. (See Linden Partners v. Wilshire Linden Associates (1998) 62
Cal.App.4th 508, 529 [“It has been repeatedly held by the courts of our state that one to
whom a representation is made has no duty to employ means of knowledge which are
open to that party and which could, if pursued, reveal the falsity of that representation”];
Alexander, supra, 7 Cal.App.4th at p. 977 [“[T]he concept of ‘let the buyer beware’ is an
anachronism in California having little or no application in real estate law”].)
In a similar vein, we reject sellers’ assertion that the undisclosed conditions
were within buyers’ diligent attention as a matter of law because they could have
discovered the conditions by retaining experts to inspect the property, something sellers
claim was recommended multiple times during escrow. “[A] buyer is entitled to rely
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upon a seller’s representations concerning the area of the property being sold, and is not
required to hire an expert to discover the falsity of the seller’s representations.” (Furla v.
Jon Douglas Co. (1998) 65 Cal.App.4th 1069, 1079 (Furla); see also Hartong v. Partake,
Inc. (1968) 266 Cal.App.2d 942, 966 (Hartong) [“Where a plaintiff commences an
investigation, his failure to discover the truth may be excused by the defendant’s superior
knowledge of the facts, the difficulty in ascertaining all of the facts or plaintiff’s
incompetence to judge the facts without expert assistance”].)
Turning to sellers’ knowledge, whether sellers knew the undisclosed facts
were not within the diligent attention of buyers is a factual issue on which there was
conflicting evidence. On one hand, sellers noted they twice gave buyers the contact
information for the company who performed the pool crack repairs and stated they
believed buyers would contact that company if they were interested in the repair
information. On the other hand, there was evidence not all the undisclosed information
would have been discovered by contacting the pool crack repair company. Sellers
possessed documents showing, at minimum, the pool replastering was performed by a
different company and the pool shell rotation and slope creep issues were identified and
known to companies other than the one for which sellers gave buyers contact
information.
Lastly, regarding buyers’ reliance, we recognize the seller’s duty to disclose
does not relieve a buyer of the duty to exercise reasonable care to protect himself or
herself. ““If the conduct of the [buyer] in the light of his own intelligence and
information was manifestly unreasonable, . . . he will be denied a recovery” on a
fraudulent misrepresentation theory. (Seeger v. Odell (1941) 18 Cal.2d 409, 415
(Seeger).) However, whether a buyer unreasonably failed to protect him or herself and/or
unjustifiably failed to discover true conditions is a case specific factual issue for the trier
of fact. (Alfaro v. Community Housing Improvement System & Planning Assn., Inc.
(2009) 171 Cal.App.4th 1356, 1383; Furla, supra, 65 Cal.App.4th at p. 1079.) Falling
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within the ambit of the trier of fact’s charge is a determination of the level of care to
which buyers should be held considering their own intelligence, knowledge and
experience. (See Seeger, at p. 415; Hartong, supra, 266 Cal.App.2d at p. 965.) Notably,
mere negligence in failing to investigate or discover the omitted facts is not a defense to
intentional misrepresentation. (Smith v. Williams (1961) 55 Cal.2d 617, 620.)
Sellers urge us to decide whether buyers’ reliance was reasonable and
justified as a matter of law. They argue buyers’ reliance was unreasonable because
buyers’ agent did not fulfill her statutory duty to inspect the property. But generally,
“[t]he fact than an investigation would have revealed the falsity of the misrepresentation
will not alone bar . . . recovery.” (Seeger, supra, 18 Cal.2d at pp. 414-415.) And,
buyer’s agent’s inspection obligation extended, at most, to “a reasonably competent and
diligent visual inspection of the property[.]” (Civ. Code, § 2079.) As previously
discussed, there is a triable issue of material fact whether the undisclosed facts were
observable via a visual inspection.
In sum, the record is replete with triable issues of material fact concerning
the alleged violation of sellers’ common law duty of disclosure, as well as the other
matters raised by sellers which are relevant to buyers’ intentional and/or negligent
misrepresentation causes of action.
2. Statutory disclosure duties
Buyers’ fifth cause of action alleged sellers violated their statutory
disclosure obligations. Specifically, the cause of action alleged sellers failed to “provide
[buyers] with transfer disclosure statements required by law setting forth all material facts
relating to the . . . [p]roperty[.]” We requested further briefing from the parties
concerning whether sellers met their initial summary judgment burden as to this cause of
action. The briefing confirms sellers did not meet their burden.
“[T]he Legislature enacted . . . article 1.5 of the Civil Code which specifies
the information a residential real property seller must disclose when transferring the
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property. In enacting this article, the Legislature made clear it did not intend to alter a
seller’s common law duty of disclosure. The purpose of the enactment was instead to
make the required disclosures specific and clear. . . .” (Calemine, supra, 171 Cal.App.4th
at p. 161.) “The Legislature specified the precise disclosure form which must be used”
(id. at p. 162), known as a transfer disclosure statement. (Civ. Code, § 1102.6.) It also
specified the disclosures must be made in good faith. (Civ. Code, § 1102.7.)
In their trial court papers, sellers failed to address a seller’s statutory
disclosure obligations and the required transfer disclosure form. The latter is not even
included in the record. Although sellers contend the omission was detrimental to buyers’
claim, the converse is true.
A defendant moving for summary judgment or adjudication “has the initial
burden of showing that the [challenged] cause of action lacks merit because one or more
elements of the cause of action cannot be established or there is a complete defense to
that cause of action.” (Rehmani v. Superior Court (2012) 204 Cal.App.4th 945, 950.) By
not providing the trial court with the transfer disclosure statement, other evidence of
compliance with their statutory disclosure obligations or an explanation why buyers’
claim necessarily failed, sellers did not meet that burden vis-à-vis buyers’ fifth cause of
action. As a result, the burden never shifted to buyers to demonstrate a triable issue of
fact on that cause of action (ibid.), and summary judgment was improper (see Hayman v.
Block (1986) 176 Cal.App.3d 629, 639 [summary judgment resolves all causes of action
on all theories]).
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DISPOSITION
The judgment is reversed. Buyers are entitled to costs on appeal.
THOMPSON, J.
WE CONCUR:
O’LEARY, P. J.
MOORE, J.
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