Hidden mold case threatens realty firm
A home inspector will be held accountable for only $440 in damages to a homebuyer who claimed intentional concealment of a mold problem during a pre-sale inspection, a New York appellate court ruled recently. But several other defendants, including the realty firm involved in selling the home, may have the claims against them reinstated.
The Supreme Court, Appellate Division, Second Department of New York upheld part of the Rockland County, New York Supreme Court’s decision on Nov. 7, holding a home inspector liable for only $440 in damages. Other portions of the case were reversed, as the appellate court could not find reason to dismiss complaints against five other defendants.
The home inspection
According to the court, defendant Patricia A. Delaney of defendant Delaney Realty Corp. assisted plaintiffs Ira Clement, et al, in seeking and buying a home in 2003. The plaintiff viewed the home of defendants William J. Shovlin and Susan Galligan Shovlin, and planned to purchase the house pending an inspection.
Clement entered a contract with defendants Arcenio Pena and FTF Inspection Corp. before purchasing the home in November 2003. The home inspection contract allegedly included some limitations, including a provision that limited the inspector’s liability.
After FTF Inspection Corp. completed its inspection of the home, the plaintiffs purchased the house with the assistance of attorney and defendant Peter Zelmanow.
Weeks after buying the home, the plaintiffs allegedly uncovered a “serious mold condition,” causing them to leave the premises in June 2004. They filed suit in February 2006 against Zelmanow, the Shovlins, Delaney and Delaney Realty Corp., Pena and FTF Inspection Corp.
According to the court, Clement hired another inspector to examine the home on Dec. 22, 2005, about 28 months after FTF Inspection Corp. completed its inspection. The plaintiffs argued their subsequent documents showed “gross negligence” on the part of FTF.
After they were sued, FTF Inspection Corp. made a motion for a summary judgment. The remaining defendants filed separate pre-answer motions to dismiss the complaints against them, all of which the Supreme Court granted in October 2006.
Several orders reversed
FTF established sufficient evidence to establish a presumption of fact, entitling it to judgment, when it filed its motion for a summary judgment, the appellate court ruled. The appellate court determined it would be “speculative” to assume the mold problem that the plaintiffs’ second expert found was also present and noticeable when FTF inspected the home about 28 months earlier.
The plaintiff also could not avoid the inspection contract provisions by claiming fraud against FTF, the appellate court stated, as “cause of action sounding in fraud does not lie where, as here, ‘the only fraud claim relates to a breach of contract.’”
Although the other defendants were previously granted motions for dismissal, the appellate court found fault with this ruling. The appellate court determined it wasn’t possible to conclude that the allegations listed in the complaint failed to demonstrate a cognizable cause of action against Delaney, the Shovlins or Zelmanow. Further, the documents those defendants submitted didn’t conclusively dispose Clement’s cause of action, the court stated, ruling that the pre-answer motions should have been denied.
Ira Clement, et al. v. Delaney Realty Corp., et al.