A Pennsylvania couple's claim that a real estate agent negligently misrepresented the condition of the septic system of a house they purchased has survived preliminary objections following a Lawrence County judge's ruling.
Prudential Preferred Realty had argued that language in the standard agreement of the sale of real estate barred recovery for a negligence claim, but Court of Common Pleas Judge J. Craig Cox said Pennsylvania law protects consumers from a seller's use of a contract's integration clause as a liability shield where defective conditions aren't "readily ascertainable from routine inspection."
In the case of Wassel v. Heitzenrater, the defect at issue was underground; the defendant seller told plaintiffs James and Gail Wassel they would fix problems with the property's septic system for a small increase in the home's price tag.
However, after the Wassels purchased the house, problems with the septic system -- waste water draining into their basement, sinkholes and gray water spurting onto their neighbors' property, for example -- persisted.
They filed suit against the Fombell, Pa., home's former owners, Eric and Bonnie Heitzenrater, and Prudential.
Judge Cox's ruling, issued last month, stems from Prudential's preliminary objections to claims of negligence and unfair trade practices against it. While the judge sustained preliminary objections to the fraud claims, finding the plaintiffs were not specific enough in their averments of fraud, he allowed the negligent misrepresentation claim to proceed.
Key in Judge Cox's holding was that Pennsylvania case law preserves a negligent misrepresentation claim when a speaker fails to reasonably investigate the truth of his or her words, as opposed to outright knowing they were false -- in other words, intentional misrepresentation.
"Clearly, the defective condition of the septic system could not be ascertained by merely inspecting the property, as it would require excavating around the septic tanks to inspect the condition of that system," Judge Cox said. "Thus, the plaintiffs are not barred [from] presenting evidence of any alleged misrepresentations regarding the condition of the septic tanks that induced them into purchasing the residence."
In the Wassel case, the sellers told the plaintiffs there was water leakage in the basement, problems with the septic system and other foundational issues.
The plaintiffs' mortgage lender required repairs to the septic system before the house could be sold. After the repairs, the price went from $137,000 to $140,000.
When the Wassels moved in, they noticed waste water draining into the basement after showers, rain water and gray-colored water flowing into the basement, and sinkholes developing near the new septic tank that came with the pre-sale repairs.
After employing an excavator, the Wassels discovered that pipes connecting their new septic tank to the old one were leaking. The old tank was also damaged.
Richard W. Kelly of Kelly Law in Pittsburgh represented the Wassels and was not available for comment.
James P. Sommers of the Sommers Law Office in Sewickley represented Prudential and was also not available.