ALEXANDER, J.
¶ 1 After a landslide damaged their home, the homeowners sued the sellers of the home, seeking rescission or, in the alternative, damages for fraud, fraudulent concealment, negligent misrepresentation, and breach of contract. The homeowners also sued the sellers' broker and agent, alleging fraud, fraudulent concealment, negligent misrepresentation, and breach of common law fiduciary duties. They leveled similar claims against their own broker and agent together with a claim for breach of statutory fiduciary duties. The trial court entered summary judgment dismissing all of the homeowners' claims, except the fraudulent concealment claims against the sellers and the sellers' broker and agent regarding cracks in the concrete basement floor. The Court of Appeals affirmed that decision in part and reversed it in part. The sellers and the homeowners' broker and agent then obtained review in this court. We affirm the Court of Appeals' decision and remand to the trial court for further proceedings consistent with this opinion.
¶ 2 In 2004, Timothy Jackowski and Eri Takase (collectively Jackowskis), a married couple, purchased a waterfront home in Mason County from David and Robin Borchelt (Borchelts). In the transaction, the Jackowskis' broker was Hawkins Poe Inc., dba Coldwell
¶ 3 The Jackowskis and Borchelts entered into a residential real estate purchase and sale agreement (PSA) on May 13, 2004. As part of the transaction, the Borchelts, as sellers, completed a "Form 17" real property transfer disclosure statement. On this form, the Borchelts checked "no" in response to the following questions: (1) "Has there been any settling, slippage, or sliding of the property or its improvements?" (2) "Does the property contain fill material?" (3) "Is there any material damage to the property from... landslides?" and (4) "Are there any other existing material defects affecting the property that a prospective buyer should know about?" Clerk's Papers (CP) at 915, 916. Prompted by an inspection of a county-ordered revegetation project, the Borchelts later amended Form 17 to refer to a Mason County Department of Community Development letter dated June 11, 2003. The letter, which signified the granting of a permit for a block wall as a part of the revegetation project, indicated that the property was located within a landslide hazard area. It also referred to a geotechnological report by geologist Harold Parks, which had been ordered in 2002 when the Borchelts contemplated an addition to the house. The Parks report said that a slope on the property was unstable within the first 25 feet of the shoreline, particularly within the first 10 feet. Although the report indicated that an addition could be safely placed only to the west of the existing house, it was eventually built to the north of the existing house.
¶ 4 The Borchelts provided the amended Form 17, including the above mentioned documents, to Conklin. Conklin then passed along the information to Johnson. It is unclear from the record when the Jackowskis received and reviewed the amended Form 17. It appears, however, that Johnson e-mailed the form to them within a day or two of the date on which the parties signed the PSA.
¶ 5 The PSA included an inspection addendum that was signed by the Jackowskis. It provided them with an option to inspect the property within 15 days after they made an offer. Although the Jackowskis obtained a standard home inspection on Johnson's advice, they did not conduct an inspection of soil stability prior to closing. The sale closed on June 30, 2004.
¶ 6 In 2006, a landslide occurred that caused damage to the house. The Jackowskis were advised by an engineer to vacate the house immediately and they did so. The Jackowskis claim that at this time they learned from neighbors that the Borchelts had concealed the fact that the addition on the north side of the house had been constructed on uncompacted fill material. The Jackowskis also claim that they learned after the sale had closed that the Borchelts concealed cracks in the concrete basement floor by covering the floor with carpet. The concealment, according to the Jackowskis, occurred after the Borchelts put the house on the market, but prior to the time the Jackowskis first viewed the property.
¶ 7 The Jackowskis brought suit against the Borchelts for rescission or, alternatively, for damages based on causes of action for fraud, fraudulent concealment, negligent misrepresentation, and breach of contract. The Jackowskis also sued the brokers and agents for fraud or negligent misrepresentation related to the property being in a landslide hazard area and for breach of common law fiduciary duties. The trial court permitted the Jackowskis to amend their complaint against Hawkins Poe and Johnson to include an allegation of failure to meet statutory duties under 18.86.050(1)(c) and against the Borchelts, Windermere Himlie, and Conklin for fraud and fraudulent concealment of cracks in the basement.
¶ 8 The Borchelts moved for a summary judgment dismissing all of the Jackowskis' claims against them. The trial court dismissed the Jackowskis' breach of contract claim on the basis that the Jackowskis failed
¶ 9 The trial court denied the Borchelts' request to dismiss the Jackowskis' fraudulent concealment claim insofar as it was based on an allegation that the Borchelts concealed cracks in the basement by covering them with carpet.
¶ 10 Hawkins Poe and Johnson also moved for summary judgment. The trial court granted their motion only as to the negligent misrepresentation claim, again relying on Alejandre. Because the trial court did not address the remaining claims, Hawkins Poe and Johnson again moved for a summary judgment dismissing the claims the trial court had not addressed. The trial court granted the motion also on the basis of Alejandre.
¶ 11 Windermere Himlie and Conklin similarly moved for summary judgment. The trial court partially granted their motion reasoning that the Jackowskis had received written disclosures that the property was in a landslide hazard area and that a reasonable inspection of the property would have disclosed landslide risk and the presence of fill material. The trial court denied summary judgment on the Jackowskis' fraudulent concealment claim based on cracks in the basement for reasons similar to those set forth by the trial court in response to the Borchelts' motion.
¶ 12 The Jackowskis appealed the trial court's decisions to the Court of Appeals. That court affirmed the trial court in part and reversed it in part, remanding for trial on unresolved issues. Jackowski v. Borchelt, 151 Wn.App. 1, 209 P.3d 514 (2009). Specifically, the Court of Appeals affirmed the trial court's dismissal of the following claims by the Jackowskis: (1) negligent misrepresentation claims against the Borchelts and (2) all fraud and fraudulent concealment claims against "all parties" relating to the landslide issue. Id. at 21, 209 P.3d 514. The Court of Appeals reversed the trial court's dismissal of the following claims by the Jackowskis: (1) statutory and common law breach of fiduciary duty claims against Hawkins Poe and Johnson; (2) all causes of action relating to fraud regarding fill material; and (3) the breach of contract claims against the Borchelts. The Court of Appeals also held that the Jackowskis were not, under either the economic loss rule or chapter 64.06 RCW, barred from seeking common law rescission of the PSA.
¶ 13 The Borchelts, Hawkins Poe, and Johnson sought and obtained our review of the Court of Appeals' decision. Jackowski v. Borchelt, 168 Wn.2d 1001, 226 P.3d 780 (2010). They claimed that the Court of Appeals erred in (1) reversing the trial court's dismissal of the Jackowskis' claims that the real estate licensees breached statutory and common law fiduciary duties, (2) reversing the trial court's dismissal of causes of action alleging fraud concerning fill material, and (3) permitting the Jackowskis to seek common
¶ 14 We review de novo an order granting summary judgment, "taking all facts and inferences in the light most favorable to the nonmoving party." Biggers v. City of Bainbridge Island, 162 Wn.2d 683, 693, 169 P.3d 14 (2007). Summary judgment is only appropriate if the moving party shows that "there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." CR 56(c).
¶ 15 This case also presents questions of statutory interpretation, which we review de novo. See Whatcom County Fire Dist. No. 21 v. Whatcom County, 171 Wn.2d 421, 427, 256 P.3d 295 (2011) (citing In re Pers. Restraint of Cruze, 169 Wn.2d 422, 426, 237 P.3d 274 (2010)). In interpreting the meaning of a statute, we are to discern and implement the legislature's intent. If we conclude that the statutory language is unambiguous and legislative intent is apparent, we will not construe the statute otherwise. Plain meaning, however, may be gleaned "`from all that the Legislature has said in the statute and related statutes which disclose legislative intent about the provision in question.'" Id. at 433, 256 P.3d 295 (Chambers, J. dissenting) (quoting Dep't of Ecology v. Campbell & Gwinn, LLC, 146 Wn.2d 1, 11, 43 P.3d 4 (2002)).
¶ 16 We begin by addressing the question of whether the Court of Appeals erred in reversing the trial court's dismissal of the Jackowskis' claims that Hawkins Poe and Johnson breached common law and statutory fiduciary duties. As stated above, the trial court's decision and the Court of Appeals' decision, as well as most of the parties' briefing for our review, relied upon our exposition of the economic loss rule in Alejandre. Since accepting review of this case, we have recast the economic loss rule as the independent duty doctrine. See Eastwood, 170 Wn.2d 380, 241 P.3d 1256. The parties have provided additional briefing, which we have considered.
¶ 7 The long-established purpose of the economic loss rule was to supply courts with a method by which to discern the line between contract and tort. Alejandre, 159 Wash.2d at 681, 153 P.3d 864. In Alejandre, home purchasers made a tort claim against a seller for an allegedly negligent misrepresentation regarding a septic tank. We disallowed the claim, concluding that it was barred by then-extant economic loss rule. Id. at 689, 153 P.3d 864.
¶ 18 Subsequent to Alejandre, in Eastwood we said that the "term `economic loss rule' has proved to be a misnomer." Eastwood, 170 Wash.2d at 387, 241 P.3d 1256 (Fairhurst, J., plurality opinion). In its place we adopted the nomenclature independent duty doctrine. Id.; see also id. at 408, 241 P.3d 1256 (Chambers, J., concurring). We recognized in Eastwood that the duty to not commit waste was based either on statute and common law or statute alone. We held, therefore, that the duty to not commit waste was independent of the lease agreement. We concluded that "[a]n injury is remediable in tort if it traces back to the breach of a tort duty arising independently of the terms of the contract." Id. at 389, 241 P.3d 1256.
¶ 19 Before reaching the question of whether an independent duty existed in this case, we must address an argument made by Hawkins Poe and Johnson that the doctrine enunciated in Eastwood should apply prospectively only. See Pet'rs Hawkins Poe and Johnson's Suppl. Br. re Eastwood & Affiliated FM at 15. "`Ordinarily, a decision of a court of last resort overruling a former decision is retrospective as well as prospective in its operation, unless specifically declared by the opinion to have a prospective effect only.'" State ex rel. Wash. State Fin. Comm. v. Martin, 62 Wn.2d 645, 671, 384 P.2d 833 (1963) (quoting Fla. Forest & Park Serv. v. Strickland, 154 Fla. 472, 476, 18 So.2d 251 (1944)). The default of retroactive application is "`"overwhelmingly the norm."'" Lunsford v. Saberhagen Holdings, Inc., 166 Wn.2d 264, 270, 208 P.3d 1092 (2009) (quoting Robinson v. City of Seattle, 119 Wn.2d 34, 74, 830 P.2d 318 (1992) (quoting James B. Beam Distilling Co. v. Georgia, 501 U.S. 529, 535, 111 S.Ct. 2439, 115 L.Ed.2d 481 (1991))). In Lunsford, we unequivocally held that "[b]y its very nature, the decision to apply a new rule prospectively must be made in the decision announcing the new rule of law." Id. at 279, 208 P.3d 1092. Because we did not decide in Eastwood or Affiliated FM that the independent duty doctrine is to be applied prospectively only, we decline to do so here.
¶ 20 In their complaint, the Jackowskis alleged that Hawkins Poe and Johnson breached their common law fiduciary duties to disclose material information about the property. See, e.g., CP at 1392. In response, Hawkins Poe and Johnson assert that the common law fiduciary duties of real estate licensees
¶ 21 In adopting this statutory scheme, the legislature changed some of the common law fiduciary duties of real estate licensees and
¶ 22 Since the language of the statute, RCW 18.86.110, is not ambiguous, we will not construe it to mean anything different from what it says: common law duties continue only to the extent they have not been limited by or are not otherwise inconsistent with the statute. That does not, however, end our inquiry.
¶ 23 We next determine whether Hawkins Poe and Johnson owe the Jackowskis an independent duty based in statutory law. The Jackowskis allege that Hawkins Poe and Johnson breached their duty under RCW 18.86.050(1)(c), which requires a buyer's agent to "advise the buyer to seek expert advice on matters relating to the transaction that are beyond the agent's expertise." More specifically, the Jackowskis claim that Hawkins Poe and Johnson should have advised the Jackowskis to hire a geotechnical expert to inspect the property. Hawkins Poe and Johnson make several arguments in an attempt to avoid liability; however, none of these arguments adequately addresses the Jackowskis' allegation that the real estate licensees breached RCW 18.86.050(1)(c) by failing to advise the Jackowskis to seek the advice of a geotechnical expert. Hawkins Poe and Johnson first argue that the "legislative enactments codified in RCW 18.86 recognize and accept that real estate agents do not have an independent duty to conduct an inspection of the property." Pet'rs Hawkins Poe and Johnson's Suppl. Br. re Eastwood and Affiliated FM at 7.
¶ 24 Hawkins Poe and Johnson also argue that the PSA had already allocated the risk of disclosure failures and, therefore, "[a]llowing a party to impose additional tort duties not set forth in the contract, but within the bargained-for subject matter of the contract, would circumvent the allocation of losses set forth in, and impair the integrity of, the governing contract." Id. at 10. Parties to a contract may allocate the risk between them. But here, Hawkins Poe and Johnson, as real estate licensees, are not parties to the contract. The issue before us, involving allegations of breach of statutory duties by real estate licensees imposed under RCW 18.86.050(1)(c), is independent of the bargained-for subject matter of the PSA.
¶ 25 Hawkins Poe and Johnson also contend that the duty imposed under RCW 18.86.050(1)(c) can be understood
Pet'rs Hawkins Poe and Johnson's Suppl. Br. re Eastwood and Affiliated FM at 11-12. Contrary to Hawkins Poe and Johnson's assertion, RCW 18.86.050(1)(c) does not limit a licensees' duties to these hypothetical situations. Rather the statute broadly includes "matters relating to the transaction that are beyond the agent's expertise." RCW
¶ 26 Hawkins Poe and Johnson argue, additionally, that the Court of Appeals "erred in holding that RCW 18.86 creates a private right of action." Suppl. Br. of Pet'rs Hawkins Poe and Johnson at 15. The Court of Appeals did not indicate that it was creating a new cause of action and did not apply the three-part test, set forth in Bennett v. Hardy, 113 Wn.2d 912, 920-21, 784 P.2d 1258 (1990), for determining whether a statute creates a new cause of action.
¶ 27 We hold that there is sufficient evidence in the record on the factual issue of whether Hawkins Poe and Johnson violated RCW 18.86.050(1)(c) to survive summary judgment. Therefore, we affirm the Court of Appeals' reversal of the trial court's grant of summary judgment on the Jackowskis' claims that Hawkins Poe and Johnson breached statutory duties.
¶ 28 The next question before us is whether the Court of Appeals erred in finding that chapter 64.06 RCW does not bar common law rescission. The Borchelts make a statutory argument that "[c]hapter 64.06 RCW eliminates the availability of common law rescission with respect to claims based solely on Form 17 disclosures, where any such claim does not require proof of the seller's `actual knowledge.'" Borchelts' Pet. for Review at 13. The Borchelts depend on RCW 64.06.070 and .050 to support their abrogation argument. RCW 64.06.070 states:
(Emphasis added.) RCW 64.06.050(1) provides that "[t]he seller shall not be liable for any error, inaccuracy, or omission in the real property ... disclosure statement if the seller had no actual knowledge of the error, inaccuracy, or omission." (Emphasis added.) Although RCW 64.06.030 permits buyers to rescind an offer within three days of receiving the disclosure statement, the statute does not explicitly bar buyers from seeking remedies, including rescission, at a later date if they discover negligence or intentional misrepresentations. The Borchelts read the aforementioned provisions together to mean that the common law was retained except in situations, such as they claim here, where the seller lacked adequate knowledge relating to Form 17 disclosures as provided in RCW 64.06.050. We agree with the Borchelts that to the extent the Jackowskis base their request for rescission on negligent misrepresentation under RCW 64.06.050(1), they must show actual knowledge, as the statute indicates.
¶ 29 The Borchelts also argue that the Jackowskis are not entitled to common law rescission because they are limited
¶ 30 The final issue in this case is whether the Court of Appeals erred in reversing the trial court's grant of summary judgment on the fill issue. The Court of Appeals explained that "the Jackowskis sued the Borchelts alleging both fraud and fraudulent concealment, while alleging only fraudulent concealment against Hawkins-Poe, Johnson, Windermere Himlie, and Conklin." Jackowski, 151 Wash.App. at 17, 209 P.3d 514. That court concluded that "the Borchelts were not entitled to summary judgment dismissal of the fill issue as a matter of law for the Jackowskis' fraud and fraudulent concealment claims." Id. at 19, 209 P.3d 514. The Court of Appeals' decision does not mention the Jackowskis' fraudulent concealment claims against the real estate licensees insofar as those claims relate to the fill issue.
¶ After our decision in Eastwood, the Court of Appeals' reliance on the economic loss rule is in error. Because the duty to not commit fraud is independent of the contract, the independent duty doctrine permits a party to pursue a fraud claim regardless of whether a contract exists. See Eastwood, 170 Wash.2d at 390, 241 P.3d 1256. The same is true for a claim of negligent misrepresentation, but only to the extent the duty to not commit negligent misrepresentation is independent of the contract.
¶ 31 In a fraud claim, the plaintiffs must establish that they had a right to rely on the representation. Jackowski, 151 Wash.App. at 17, 209 P.3d 514 (citing Williams v. Joslin, 65 Wn.2d 696, 697, 399 P.2d 308 (1965)). Because the Borchelts represented in Form 17 that the property did not contain fill material, the Jackowskis were entitled to rely upon the representation. The Borchelts contend that because they later amended the Form 17 and disclosed a geotechnological report indicating the property was within a landslide area and unstable within 25 feet of the shoreline, an adequate disclosure was made. The parties, however, dispute the facts with regard to when the Jackowskis received the amended Form 17. Because there are genuine issues of material fact, it was improper for the trial court to grant summary judgment on the Jackowskis' fraud claim.
¶ 32 Similar facts drive the analysis of the fraudulent concealment claim. We have held that a "vendor's duty to speak arises where ... the defect would not be disclosed by a careful, reasonable inspection by the purchaser." Alejandre, 159 Wash.2d at 689, 153 P.3d 864 (citing Atherton Condo. Apartment-Owners Ass'n Bd. of Dirs. v. Blume Dev. Co., 115 Wn.2d 506, 524, 799 P.2d 250 (1990)). The trial court concluded there was no material question of fact that the presence of fill could have been discovered by such a reasonable inspection. In a deposition, the Jackowskis' expert, David Strong, answered "[y]es" when asked if "any competent soils inspector, reviewing the property, would have been able to see there was fill on the property." CP at 141.1. He also indicated he believed that he had characterized the fill as being "obvious" to any "qualified geologist" during his inspection.
¶ 33 Additionally, Randall Thompson, the architect for the Borchelts' addition, stated in a declaration that "[t]he fill is apparent and is located along the north boundary line of the property and is armored with quarry rock." Suppl. Clerk's Papers at 1402. Again, the Court of Appeals found it significant that "Thompson based these statements on what he observed when he inspected the property after the sliding event." Jackowski, 151 Wash.App. at 18, 209 P.3d 514. We agree it is significant that this evidence was obtained after the sliding event and, therefore, the fill may not have been "obvious" or "apparent" prior to the landslide.
¶ 34 Our review of the record reveals additional evidence that supports the Jackowskis' argument that summary judgment was inappropriate on their claims related to fraud. In this regard, the Jackowskis submitted evidence purporting to show that the Borchelts knew the property contained fill material. Robin Borchelt was asked in a deposition if the retaining wall near the house "is backfilled with fill," and she answered "[p]art of it probably is." CP at 366. When asked again if there was fill behind the retaining wall, Robin Borchelt stated she "assum[ed]" fill material was used to "level it out." Id. The Borchelts' contractor who built the addition to the house agreed with the Jackowskis' counsel during a deposition that the work he bid to perform on the Borchelts' property "included relocating materials on the site to use as fill." Id. at 368. He also agreed that "backfill extends all the way back to the original house foundation." Id. While not dispositive of the claims relating to fraud, when viewed in the light most favorable to the Jackowskis, this evidence shows that there are genuine issues of material fact relating to whether the fill could have been disclosed by a reasonable inspection prior to the landslide. We, therefore, affirm the Court of Appeals' reversal of the trial court's grant of summary judgment on the claims relating to fraud pertaining to the fill issue.
¶ 35 The Court of Appeals correctly reversed the trial court's dismissal of the Jackowskis' claims for breach of statutory fiduciary duties. The Court of Appeals also properly acknowledged that chapter 64.06 RCW does not bar common law rescission, and it properly reversed the trial court's dismissal of the Jackowskis' causes of action relating to fraud concerning the fill issue. For the reasons stated above, we affirm the Court of Appeals and remand to the trial court for further proceedings.
WE CONCUR: BARBARA A. MADSEN, Chief Justice, concurs in result, CHARLES W. JOHNSON, TOM CHAMBERS, SUSAN OWENS, MARY E. FAIRHURST, JAMES M. JOHNSON, DEBRA L. STEPHENS, CHARLES K. WIGGINS, Justices.