JAMES L. GRAHAM, District Judge.
Plaintiffs Jason and Natasha Milner purchased a home in Beaver, Ohio in May 2010. They later discovered water-related damage in the crawl space and mold in the attic, storage room, spare bedroom closet, and bathroom — defects they claim should have been disclosed by the seller, defendant Robin Biggs. The Milners have also brought suit against the seller's real estate agents, their own real estate agents, the title company, and the home inspector for alleged violations of the Ohio Consumer Sales Practices Act, negligence, and fraud, among other claims.
This matter is before the court on numerous motions for summary judgment filed by the various defendants and by plaintiffs. For the reasons discussed below, the court finds that each defendant is entitled to judgment as a matter of law.
The Milners began looking for a new home in the spring of 2010 because of a change in Mr. Milner's employment. N. Milner Dep. at 27-28. They engaged Brenda DePugh of Realtec Real Estate, which is operated by Angela Shanks, as their real estate agent after seeing her name on a listing of homes.
The Milners walked through the Germany Road house twice. They did not spend much time looking around the house. J. Milner Dep. at 100 (estimating that their walk-throughs were roughly five minutes long). Mr. Milner looked into the crawl space to see if the house was sitting on gravel or concrete slab, but he did not enter the crawl space.
The Milners and Robin Biggs exchanged several offers and counter-offers before arriving at an agreed purchase price. N. Milner Dep. at 31-32. Biggs hired as her real estate agent Patti Bevins of Larry Depugh Realty (no relation to Brenda DePugh). Biggs and the Milners entered into a purchase contract on April 12, 2010. The contract contained the following clause:
Purchase Contract at § 13.
The contract included an Inspection Addendum in which the Milners agreed to pay for the cost of a whole house inspection and Biggs agreed to pay for a termite inspection and an inspection of the septic system.
The Germany Road house was built in 1977. Biggs Dep. at 6-7. Biggs owned and lived in the house from October 2006 until May 2010.
The Residential Property Disclosure Form was given to the Milners, who initialed it at the time of purchase. The Form contained the following warning: "Purchaser is advised that every home contains mold. Some people are more sensitive to mold than others. If concerned about this issue, purchaser is encouraged to have a mold inspection done by a qualified inspector." Residential Property Disclosure Form at § D. Biggs indicated on the Form that she had never had a mold inspection performed on the house.
Mrs. Milner asked Brenda DePugh if she could recommend a home inspector. Brenda DePugh recommended Frank Roberts because he was "the best" and "certified," but she stated that she could provide a list of other inspectors. N. Milner Dep. at 37, 39. The Milners hired Roberts to perform a whole house inspection before DePugh could provide them with additional names.
Roberts completed a program in home inspection training through Inspection Training Associates in Virginia. Roberts Dep. at 8-10. The program included home study courses and hands-on training. Roberts received a certificate of completion upon finishing the program.
On April 22, 2010, Roberts performed a whole house inspection of the Germany Road house. Access to the crawl space was through a small door in a utility room. Roberts Dep. at 31-32 (estimating that the door was two feet wide by two feet high). Roberts lowered himself into the crawl space, which he described as "very low" — "Twenty inches is about all the room you had. ... Because when you step down from the house into the crawlspace, the floor hits you about just above your knees. So you're sitting there like you're in a hole."
Roberts provided a written home inspection report to the Milners. It stated that the scope of his inspection was a "limited visual inspection of the general systems and components of the home" and did not include any area that was not exposed to view, concealed, or inaccessible. Roberts Inspection Report at 1. The report found eight main items of concern, including a crack in the concrete of the front porch and the fallen ductwork in the crawl space. On the page of the report concerning the foundation of the house, Roberts checked the boxes indicating that he had entered the crawl space and not seen any moisture.
Following the home inspection, Biggs and the Milners entered into an addendum of the purchase contract in which Biggs agreed to fix certain items that Roberts had recommended as needing attention. This included the fallen ductwork.
The fallen ductwork was part of a heating and air conditioning system that Biggs had installed in 2009. Biggs Dep. at 8-9. The person she hired to install it was recommended by her father. Biggs had no part in the installation other than giving approval to the installer and his workers to remove some bricks from the exterior wall so they had more room to get the unit into the crawl space.
The Milners closed on the house on May 17, 2010 and moved in the next day. N. Milner Dep. at 8. The Milners selected defendant Arrow Title Agency, LLC to prepare a deed. Mrs. Milner had planned to use Best Title Company, which her lender recommended, but decided to use Arrow when Brenda DePugh indicated that using Arrow would make the travel times easier for everyone involved on the day of closing.
Once the Milners moved into the house, they noticed a "soft spot" in their floor, which prompted Mr. Milner to enter the crawl space to look for a cause. J. Milner Dep. at 78-79. He found that the floor joists "appeared to be all rotted."
After filing this lawsuit, the Milners had a home inspection performed by Parker Inspection Services in May 2011. The inspection report found suspected mold growth in the attic, storage room, spare bedroom closet, and bedroom.
The Milners originally filed suit in the Court of Common Pleas for Pike County, Ohio. The complaint contained a claim under the federal Real Estate Settlement and Procedures Act ("RESPA"), 12 U.S.C. § 2601, et seq. The case was removed to this court by defendants on October 7, 2010 on the basis of federal question jurisdiction.
The complaint names the following as defendants: (a) the seller, Robin Biggs; (b) the seller's real estate agents, Patti Bevins and Larry Depugh of Larry Depugh Realty; (c) the buyers' agents, Brenda DePugh and Angela Shanks of Realtec Real Estate; (d) the title company, Arrow Title Agency and its agents Jonathan Holfinger and Chris Moore; and (e) the home inspector, Frank Roberts.
The complaint alleges that the Germany Road house had mold, rotting floor joists, standing water, inadequate drainage, and "insufficient depth of the foundation." The complaint asserts twelve cause of action: (1) request for injunctive relief; (2) violations of the Ohio Consumer Sales Practices Act; (3) negligence; (4) negligent misrepresentation; (5) breach of fiduciary duty; (6) conspiracy; (7) fraudulent concealment; (8) fraudulent inducement; (9) fraud; (10) breach of contract; (11) violations of RESPA; and (12) unjust enrichment. Some of the claims are asserted against only certain defendants.
None of the defendants filed a motion to dismiss. Arrow filed a motion for judgment on the pleadings as to five of the six claims asserted against it. The motion was granted as to counts two, six, and twelve, but denied as to counts three and four.
Subsequently, defendants Brenda DePugh and Shanks moved for partial judgment on the pleadings as to counts two and six. This motion is currently ripe for decision, as are ten motions for summary judgment that have been filed by plaintiffs and defendants.
After several of the pending motions were filed, plaintiffs moved for leave to file an amended complaint to add new claims and defendants concerning alleged termite damage. The court denied this motion, which was filed several months after the completion of discovery and at least six months after plaintiffs knew about the existence of termite damage.
Under Federal Rule of Civil Procedure 56, summary judgment is proper if the evidentiary materials in the record show that there is "no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a);
The "mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact."
A district court considering a motion for summary judgment may not weigh evidence or make credibility determinations.
The complaint asserts claims against Biggs for negligent misrepresentation, conspiracy, fraudulent concealment, fraudulent inducement, fraud, breach of contract, and unjust enrichment. These claims, including the breach of contract claim, relate to the same underlying assertion — that Biggs should have disclosed to the Milners that the house had mold in various locations and had water-related damage to the floor joists in the crawl space. Biggs has moved for summary judgment, arguing that the claims against her fail because the Milners purchased the house "as is."
In the sale of real estate, the doctrine of caveat emptor applies.
The elements of fraudulent concealment or representation are: "(1) a representation or concealment of fact, (2) which is material to the transaction, (3) made falsely, with knowledge of its falsity, or with such utter disregard and recklessness as to whether it is true or false that knowledge may be inferred, (4) with the intent of misleading another into relying upon it, (5) justifiable reliance upon the representation or concealment, and (6) injury proximately caused by the reliance."
The court finds that Biggs is entitled to summary judgment on the claims relating to the alleged existence of mold. Biggs did not make any representations about the existence of mold on the Residential Property Disclosure Form. The Form asked only whether the seller had, in the past, had the house inspected for mold. Biggs answered "no" and plaintiffs do not contend that her answer was untruthful.
The Milners argue that Biggs concealed the mold problems in the storage room, closet, and bathroom.
The court, however, finds that plaintiffs have offered no evidence from which a jury could reasonably find that Biggs acted with the requisite knowledge and intent in allegedly concealing the mold from plain view. Biggs's unrefuted testimony is that she did not see any mold in the storage room and closet when she put the boxes in the storage room and her daughter's clothes in the closet. Biggs Dep. at 22-23. She accessed these areas infrequently.
Plaintiffs have not submitted any evidence to challenge the testimony of Biggs. Plaintiffs admit that they have never had the mold tested, and there is nothing on the record to indicate when the mold would have started growing. Thus, there is no evidence to support a finding that the mold would have had to have been present and visible to Biggs when she initially placed the boxes and clothing in the storage room and closet or when she later accessed those items.
Moreover, it was unreasonable for the Milners to have relied on the presumption that there would be no mold in these allegedly concealed areas. The Residential Property Disclosure Form cautioned them that "every home contains mold" and that they should perform a mold inspection if they were concerned about this issue. Residential Property Disclosure Form at § D. The Milners then executed a Mold Addendum acknowledging that it was their responsibility to conduct a mold inspection and that they "ha[d] not in any way relied upon any representations of seller [or seller's agents] ... concerning the past or present existence of mold in or around the property." Purchase Contract, Mold Addendum.
Accordingly, Biggs is entitled to summary judgment on the Milners' mold-based claims.
Plaintiffs have not been entirely consistent in describing the nature of the alleged water-related damages. In their complaint, plaintiffs alleged the existence of rotting floor joists, standing water, inadequate drainage, and "insufficient depth of the foundation." Mrs. Milner testified that the "major problem is the whole crawlspace. ... Moisture, joists, beams, depth." N. Milner Dep. at 144. Mrs. Milner conceded that she has never looked into the crawl space and viewed the alleged problems.
The Parker inspection report provides more specificity about the nature of the defects. It found moisture penetration in the crawl space (including standing water on the day of the inspection), deterioration of the center wood beam, placement of the footer above the frost line, moisture on the rear block wall in the crawl space, standing water in the backyard, and malfunction of the drain in the backyard.
The one consistent theme in plaintiffs' presentation of the case is that these water-related defects were made manifest in the deteriorating wood beams in the crawl space. Plaintiffs do not contend that Biggs concealed the beams, but they do allege that she fraudulently represented on the Residential Property Disclosure Form that she was not aware of any water-related damage or defects in the crawl space and not aware of any material problems with the foundation or crawl space.
The court finds that there is no evidence from which a jury could find that Biggs was aware of the deteriorated wood beams in the crawl space. Biggs testified that she purchased the Germany Road house "sight-unseen" at a bank auction and that she did not conduct an inspection before buying the house. Biggs Dep. at 14. She further testified that she never entered or looked into the crawl space while she lived in the house except to reach her hand in to turn a water spigot to the outside of the house off and on.
Plaintiffs have not refuted Biggs's testimony that she was unaware of the alleged defects in the crawl space. Mrs. Milner testified that she believed Biggs and her father had gone under the house "to beam the house up," but Mrs. Milner admitted that she had no personal knowledge or factual basis to support the her belief. N. Milner Dep. at 116-19. Mrs. Milner indeed conceded, "I'm speculating" in asserting that Biggs knew of defects in the crawl space.
Finally, it should be noted that plaintiffs have not attempted to prove that Biggs had knowledge of any drainage problems in the backyard. Biggs, for example, was not asked whether she had observed standing water or drainage problems in the backyard. The Parker inspection report, which states that the drain in the backyard was not functioning correctly, is not evidence in itself of the existence of a drainage problem when Biggs lived in the house because the inspection took place one year after the closing. Roberts did not observe any problems with water drainage in the backyard when he performed his inspection prior to closing. Roberts Dep. at 49; Roberts Inspection Report at 6. As such, there is no evidence from which a jury could find that Biggs knew or should have known that drainage problems posed a material risk to the foundation.
Accordingly, the court grants the motion for summary judgment as to the water-related damage claims against Biggs.
The complaint alleges that Biggs conspired with her real estate agents Patti Bevins and Larry Depugh to sell a house with structural defects. A civil conspiracy is "a malicious combination of two or more persons to injure another in person or property, in a way not competent for one alone, resulting in actual damages."
There is no evidence that Biggs acted with malice in selling her house to the Milners. As discussed, plaintiffs have failed to produce evidence from which a jury could find that Biggs had knowledge of the alleged mold or water-related defects. Plaintiffs have also failed to produce evidence from which a jury could find that Biggs had an agreement or understanding with her real estate agents to defraud the Milners. N. Milner Dep. at 250 (admitting, "I have no evidence of it, no," when asked whether the conspiracy allegations had any factual support).
Thus, Biggs's motion for summary judgment is granted as to the conspiracy claim as well.
The complaint asserts claims against Patti Bevins and Larry Depugh for injunctive relief, violations of the Ohio Consumer Sales Practices Act ("OCSPA"), negligence, negligent misrepresentation, conspiracy, fraudulent concealment, and unjust enrichment.
OCSPA prohibits the use of an unfair or deceptive act in connection with a consumer transaction. O.R.C. § 1345.02(A). The complaint alleges that Larry Depugh has violated OCSPA by operating his real estate agency Larry Depugh Realty without registering it with the Ohio Secretary of State. To that end, the complaint seeks an order permanently enjoining him from doing business under the name Larry Depugh Realty. Pending before the court are cross-motions for summary judgment filed by plaintiffs and Larry Depugh.
The court finds Depugh is entitled to summary judgment on these claims. As an initial matter, plaintiffs have not submitted evidence in support of the proposition that Depugh has failed to register Larry Depugh Realty with the Ohio Secretary of State — plaintiffs' counsel merely asserts that it is so. The only evidence of record on this issue is Depugh's denial of that allegation.
In what amounts to a new claim, plaintiffs contend for the first time at the summary judgment stage that Depugh violated OCSPA because he hired Bevins as an independent contractor. Plaintiffs' delay in asserting the claim is particularly troublesome because Depugh is defending himself pro se and the complaint did not give him fair notice of this claim. Moreover, it is not entirely clear what plaintiffs' legal theory is — plaintiffs' counsel seems to argue that the independent contractor arrangement was deceptive to clients of Larry Depugh Realty because Depugh was trying to insulate himself from vicariously liability for the actions of Bevins.
Accordingly, the court finds that defendant Larry Depugh is entitled to summary judgment on the claims for injunctive relief and OCSPA violations.
The complaint asserts that Depugh and Bevins knew of the house's mold and structural defects, as well as of Biggs's alleged attempts to conceal those problems. The complaint further alleges that defendants made misrepresentations to the Milners about the mold and structural defects and that defendants had a duty to disclose their knowledge of the defects to potential buyers. According to the complaint, defendants also breached their professional duty of care by not disclosing the defects.
Under Ohio law, a "licensee" (defined as a real estate broker or salesperson, O.R.C. § 4735.51(J)) must not knowingly provide false information to any party in a real estate transaction. O.R.C. § 4735.61. A licensee also has a duty to "disclose to any purchaser all material facts of which the licensee has actual knowledge pertaining to the physical condition of the property that the purchaser would not discover by a reasonably diligent inspection, including material defects in the property, environmental contamination, and information that any statute or rule requires be disclosed." O.R.C. § 4735.67(A). A licensee "is not required to discover latent defects in the property or to advise on matters outside of the scope of the knowledge required for real estate licensure, or to verify the accuracy or completeness of statements made by the seller, unless the licensee is aware of information that should reasonably cause the licensee to question the accuracy or completeness of such statements." O.R.C. § 4735.67(B).
In their depositions, the Milners freely admitted that Depugh and Bevins never had any contact with them or made any representations to them in connection with the sale of the house. J. Milner Dep. at 84-86; N. Milner Dep. at 215, 233. And they freely admitted that they had no basis to assert that defendants had knowledge of the defects and failed to disclose them to plaintiffs. N. Milner Dep. at 249-50, 263-67.
In response to the motion for summary judgment, plaintiffs offer no argument or evidence in support of their fraud and negligence claims, at least as those claims were presented in the complaint. Instead, plaintiffs again resort to asserting a new claim — this time alleging that defendants had knowledge of termite damage to the house and failed to disclose it to the Milners. This attempt to assert a new claim is not well-taken. Not only is there no competent evidence of record to support the assertion that defendants knew of termite damage (the attached termite inspection report that defendants allegedly reviewed in fact found no visible signs of termites), the court has denied plaintiffs' untimely attempt to amend their complaint to add termite-related claims.
The complaint alleges that Depugh and Bevins conspired with Biggs to sell a house with structural defects. As noted above, plaintiffs have failed to produce evidence from which a jury could find that defendants had an agreement or understanding with Biggs to defraud the Milners.
The complaint alleges that Depugh and Bevins were unjustly enriched by receiving fees from the real estate transaction. This claim too has no merit, as plaintiffs have made no attempt to prove that the fees defendants earned from the transaction were paid by the Milners rather than by Biggs.
Accordingly, the motions for summary judgment filed by Larry Depugh and Patti Bevins are granted in full. Plaintiffs' motion for summary judgment as to the OCSPA claim against Depugh is denied.
The complaint asserts claims against Angela Shanks and Brenda DePugh for injunctive relief, OCSPA violations, negligence, negligent misrepresentation, breach of fiduciary duty, conspiracy, and RESPA violations.
Shanks and DePugh have moved for judgment on the pleadings on the OCSPA and conspiracy claims. A motion for judgment on the pleadings brought under Federal Rule of Civil Procedure 12(c) attacks the sufficiency of the pleadings and is evaluated under the same standard as a motion to dismiss.
The complaint alleges numerous OCSPA violations by Shanks and DePugh. It alleges that they committed unfair and deceptive acts by:
Compl., ¶¶ 54-69.
Putting aside for the moment the alleged failure to register Realtec, the rest of these alleged violations all relate directly to the real estate transaction between the Milners and Biggs. These claims fail because OCSPA has no application to a pure real estate transaction.
Plaintiffs contend that OCSPA does apply because Shanks and DePugh performed collateral services in connection with the sale of the house. Plaintiffs argue that only the actual transfer of real property is exempted from OCSPA. According to plaintiffs, services "provided to assist in the transfer or real property" are covered by the statute. Plaintiffs again cite no legal authority for this position and they are directly contradicted by controlling precedent holding that OCSPA "is not applicable to those collateral services" performed in support of a real estate transaction.
The complaint alleges that Shanks and DePugh were hired "to provide real estate services to help Buyers with the purchase of their home." Compl., ¶ 17. The complaint fails to allege that defendants supplied any services to the Milners other than the ones performed in completing the real estate transaction — reviewing the purchase contract and closing documents, and arranging for the provision of home inspection and closing services that the purchase contract (which is attached to the complaint) expressly required be performed. In other words, the alleged actionable conduct is part and parcel of the sale of the house and is thus outside the scope of OCSPA.
As for defendants' alleged failure to register Realtec with the Secretary of State, again the use of an unregistered name, "absent some allegation or showing that the use of the name is deceptive or intended to deceive, does not violate the OCSPA."
Accordingly, the court grants the motion for judgment on the pleadings at to the OCSPA claims. The complaint's request for an injunction prohibiting Shanks from doing business in Ohio using the name Realtec is denied.
The motion for judgment on the pleadings is also granted as to the conspiracy claim. The complaint alleges that Shanks and DePugh conspired with both Arrow to steer clients to use Arrow for title services and with Roberts to steer clients to use his home inspection services. In granting Arrow's motion for partial judgment on the pleadings as to the conspiracy claim, the court has already held that the allegations of a conspiracy among Shanks, DePugh, and Arrow are "bereft of any factual allegations in support." June 8, 2001 Opinion and Order at 5. Thus, the motion of Shanks and DePugh for judgment on the pleadings as to the conspiracy claim is granted as the claim relates to an alleged conspiracy with Arrow.
The claim as it relates to an alleged conspiracy with Roberts likewise fails. The complaint merely alleges that the defendants "conspired," without any factual allegations in support. As such, the complaint fails to properly allege the existence of an agreement among the defendants to steer clients to use Roberts for home inspections.
Accordingly, the court grants the motion for judgment on the pleadings at to the conspiracy claims.
The complaint alleges that Shanks and DePugh negligently misrepresented that Roberts was certified to perform home inspections and misrepresented the quality of his services. The complaint further alleges that the Milners relied upon the representations in deciding to hire Roberts.
A claim for negligent misrepresentation is defined as follows:
Mrs. Milner testified that DePugh recommended Roberts when she asked DePugh if she knew of a good home inspector. N. Milner Dep. at 37. DePugh said that he was certified and the "best."
Defendants are entitled to summary judgment because there is no evidence from which a jury could find that the information DePugh supplied to Mrs. Milner was false. Plaintiffs do not allege that the State of Ohio regulates home inspectors, such that the word "certified" is defined with reference to state law or some licensing requirement. Rather, even as Mrs. Milner understood it, the word signifies completion of some level of education or training.
Plaintiffs likewise cannot demonstrate that DePugh made a misrepresentation when she told Mrs. Milner that Roberts was the "best." Exaggerated descriptions and puffery are not actionable.
Plaintiffs argue that DePugh failed to exercise reasonable care when saying that Roberts was certified because she did not require him to produce documentation of his training. This argument must be rejected. Plaintiffs cite no legal authority for imposing such a standard of care on real estate agents, and, in any event, DePugh spoke truthfully when she stated that Roberts was certified as a home inspector.
The court thus grants summary judgment in favor of Shanks and DePugh on the claim for negligent misrepresentation. The complaint's request for an injunction prohibiting Shanks and DePugh from recommending Roberts or referring to Roberts as a "certified" home inspector is thus denied.
The claims for negligence and breach of fiduciary duty are both premised on the assertion that Shanks and DePugh owed a duty to abide by the standard of care found in O.R.C. § 4735.62. That statutory provision provides as to real estate brokers:
O.R.C. § 4735.62.
The complaint alleges Shanks and DePugh breached their duties by failing to disclose that Roberts was not a certified home inspector and by failing to advise the Milners to obtain a qualified home inspector and to obtain legal counsel. These claims fail as a matter of law. Roberts was certified as a home inspector, and defendants were not on notice of any information that would have made it unreasonable for them to recommend Roberts as an inspector. Moreover, DePugh offered to provide the Milners with a list of other individuals who performed home inspections, but the Milners chose to hire Roberts before DePugh could provide them with the list. N. Milner Dep. at 37-38; B. DePugh Decl. at ¶ 10.
As for the claim that defendants breached their duty by not advising the Milners to obtain legal counsel in connection with the real estate transaction, the purchase contract signed by the Milners stated:
Purchase Contract at § 14 (emphasis added). "[P]arties to contracts are presumed to have read and understood them and that a signatory is bound by a contract that he or she willingly signed."
In briefing the cross-motions for summary judgment, plaintiffs have offered several new ways (not alleged in the complaint) that defendants breached their fiduciary duties. These include failing to: explain to the Milners the meaning of documents they signed at closing; provide copies of closing documents; inform Arrow how the Milners' names should appear on the deed; and have Mr. Milner sign a power of attorney before instructing Mrs. Milner to sign his name on his behalf. As defendants correctly observe, plaintiffs have failed to cite any competent evidence or legal authority in support of these new claims.
The court thus grants summary judgment in favor of Shanks and DePugh on the claims for negligence and breach of fiduciary duty.
The complaint alleges that Shanks and DePugh violated RESPA because they accepted kickbacks from referring clients to Arrow and Roberts. RESPA provides, "No person shall give and no person shall accept any fee, kickback, or thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or a part of a real estate settlement service ... shall be referred to any person." 12 U.S.C. § 2607(a);
Plaintiffs have moved for summary judgment on the RESPA claim. Though they argue that Shanks and DePugh unlawfully steered clients to both Arrow and Roberts, the only evidence they have submitted pertains to Arrow. Plaintiffs argue that Shanks admitted that she received payments drawn from Arrow's account upon the closing of the real estate transaction. This argument is without merit and misstates the record. Shanks admitted that her commission fees were held in escrow by Arrow and that payment was drawn from the escrow account.
Moreover, plaintiffs have failed to prove as a matter of law that Shanks and DePugh had an agreement or understanding with Arrow. The evidence thoroughly establishes that no such agreement existed. Shanks Dep. at 69; B. DePugh Dep. at 48. The record likewise demonstrates that Shanks and DePugh had no agreement with Roberts. B. DePugh Dep. at 44; Roberts Dep. at 80. Plaintiffs candidly acknowledged in their depositions that they had no knowledge of any kickback agreements and that their RESPA claim was based on speculation. N. Milner Dep. at 83, 110 (testifying that she had no basis to believe the kickback allegation and that it was all based on "assumption"); J. Milner Dep. at 52-55 (same).
Shanks and DePugh did not move for summary judgment on the RESPA claim, even though they have demonstrated in their response to plaintiffs' motion for summary judgment that the claim is without merit. A court may in limited circumstances grant summary judgment sua sponte.
All of these considerations are satisfied here. Plaintiffs moved for summary judgment on the RESPA claim, as have the co-defendants. The relevant witnesses were deposed about the existence of the alleged agreements and kickbacks, and plaintiffs have submitted all of the evidence they believe supports their RESPA claim. Furthermore, the commission of the alleged RESPA violation necessarily requires both a giver and a recipient of the kickback. Because the co-defendants have proved as a matter of law that they never gave a kickback to Shanks and DePugh, it follows that judgment must be rendered in favor of Shanks and DePugh as well.
Accordingly, the court grants the motion of Shanks and DePugh for partial judgment on the pleadings as to the OCSPA and conspiracy claims, denies plaintiffs' motion for summary judgment, and grants summary judgment to Shanks and DePugh on the remaining claims for injunctive relief, negligent misrepresentation, negligence, breach of fiduciary duty, and RESPA violations. Plaintiffs' motion to strike defendants' reply brief as untimely filed is denied, as defendants filed the brief on the first business day after the Sunday on which it was due.
The complaint alleges that Arrow was negligent in preparing the deed because Mr. Milner's name appeared on it but Mrs. Milner's name did not. The complaint further alleges that Arrow negligently misrepresented to the Milners that the deed was "correct." Compl., ¶ 96.
Both claims fail as a matter of law. The claim for negligent misrepresentation fails because there is no evidence that Arrow made a representation to plaintiffs that the deed was correct.
Turning to the negligence claim, the court finds that a jury could not reasonable find that Arrow failed to exercise due care in preparing the general warranty deed.
Plaintiffs moreover cannot prove that they have suffered any damages as a result of Arrow's alleged negligence.
Accordingly, Arrow is entitled to summary judgment on the claims for negligent misrepresentation and negligence. Arrow is further entitled to summary judgment on the RESPA claims, for reasons stated in Part V.B.3 above.
The complaint asserts claims against Roberts for injunctive relief, OCSPA violations, negligent misrepresentation, conspiracy, fraud, and RESPA violations. The crux of all but the last of these claims is that Roberts misrepresented to the Milners that he was "certified" as a home inspector. The complaint also alleges that Roberts misleadingly indicated that he had an affiliation with ASHI by including print-outs of ASHI's standards of practice and code of ethics in the inspection report he prepared for the Milners.
Mrs. Milner testified that Roberts told her that he was a certified home inspector. N. Milner Dep. at 179. She did not inquire any further about what he meant by "certified." Given the unrefuted evidence that Roberts was certified as a home inspector by Inspection Training Associates, Roberts Dep. at 8-10, plaintiffs cannot establish that Roberts engaged in a deceptive act for purposes of the OCSPA claim or made a misrepresentation for purposes of the negligent misrepresentation and fraud claims. Further, plaintiffs have submitted no evidence that Roberts conspired with Shanks and Brenda DePugh to steer clients to him under a false pretense that he was certified.
Also without merit is the claim that Roberts misleadingly indicated an affiliation with ASHI. Mrs. Milner admitted that Roberts never orally represented that he was an ASHI member. N. Milner Dep. at 183. The claim is based on the inclusion of ASHI materials in the inspection report. Plaintiffs, however, cannot establish that they relied on Roberts's purported affiliation with ASHI because they admit that, despite having received the inspection report before closing, they waited to read it until after closing on the house. N. Milner Dep. at 189 (stating that they did not read the report because "I wasn't sure what was in it"). Moreover, any alleged reliance on ASHI affiliation would be unreasonable as a matter of law because the first sentence of the ASHI materials stated, "Distribution of this material is not an indication of ASHI Membership." Roberts Inspection Report, ASHI Materials at 2.
In their briefs, plaintiffs allege for the first time that Roberts committed fraud because he misrepresented on the inspection report that he found nothing wrong in the crawlspace. Roberts reported that the foundation appeared serviceable and that the crawl space was dry.
Thus, Roberts is entitled to summary judgment on the claims for OCSPA violations, negligent misrepresentation, conspiracy, and fraud. The court denies the complaint's request for injunctive relief prohibiting Roberts from representing that he is a certified home inspector and prohibiting him from distributing ASHI's standards of practice and code of ethics. Roberts is also entitled to summary judgment on the RESPA claim, for reasons stated in Part V.B.3 above.
For the reasons set forth above, the motion of Shanks and Brenda DePugh for partial judgment on the pleadings (doc. 63) is GRANTED. Defendants' motions for summary judgment (docs. 68, 77, 98, 110, 111, 112) are GRANTED. Plaintiffs' motions for summary judgment (docs. 103,106, 107, 108) are DENIED. The Clerk shall enter judgment in favor of the defendants.