BUSINESS LAW: YOUNG V. VISTA HOMES, INC. (COA 1/12/2007)

YOUNG V. VISTA HOMES, INC.
BUSINESS LAW: Construction contracts; fraud; punitives; attorney fees
2004-CA-001618
PUBLISHED: AFFIRMING IN PART, REVERSING IN PART, REMANDING; WINE
DATE RENDERED: 1/12/2007

This case is remarkable for one thing.  The Court of Appeals found that Vista built homes that were advertised as four bedrooms, had brochures that said four bedrooms and that Vista reps told the purchasers they were four bedrooms.  The CA also found that Vista built the homes with three bedroom septic system, ( undersized ), and that Vista called it a "Bonus Room" in contracts and other printed material.

Yet the CA held that Vista had not intended to misrepresent and thus remanded the punitive damage instruction.  Incredible.  Another example of hedonistic calculus.

The concealment by a seller of a material defect in property being sold, or the suppression by him of the true condition respecting the property, so as to withhold from the buyer information he is entitled to, violates good faith, and constitutes a deception.

And most importantly, Re/Max would only be subject to a misrepresentation claim if it or its agents knowingly or recklessly made a material misrepresentation upon which the homeowners were induced to rely.

But as Re/Max points out, its contracts with the homeowners expressly disclaim the accuracy of the information provided by its agents.  Where all of plaintiff’s claims arise from the same nucleus of operative facts and each claim was “inextricably interwoven” with the other claims, apportionment of fees is unnecessary.

Because the trial court erroneously concluded that apportionment was required, the award of attorney fees must be remanded for a new calculation under the proper standard.

By Paul Schurman

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