Dicker v Housemaster

[*1] Dicker v Housemaster 2006 NY Slip Op 50174(U) [11 Misc 3d 1051(A)] Decided on February 9, 2006 Supreme Court, Nassau County O'Connell, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on February 9, 2006
Supreme Court, Nassau County

Joshua Dicker and Ellen Dicker, Plaintiffs,

against

The Housemaster and Charles Hennessy, Defendants.



11458/05

Geoffrey J. O'Connell, J.

In this action sounding in negligence and breach of contract Defendants The Housemaster and Charles Hennessy apply to the Court for an order dismissing the complaint pursuant to CPLR § 3211 (a)(1), asserting the existence of a defense based upon documentary evidence.

Background Facts

Plaintiffs Joshua and Ellen Dicker entered into a written "Home Inspection Order Agreement" with AMC Property Evaluations on July 2, 2004. The agreement was signed by Plaintiff Joshua Dicker as "client" and by Defendant Charles Hennessy as "Company Representative." Plaintiffs were contemplating the purchase of 17 The Tulips, Roslyn, New York, and that premises was the subject of the inspection agreement. The fee for the inspection was $520.00.

The agreement describes the service to be provided as a "Limited Time/Scope Home Inspection." In a paragraph entitled "Purpose and Scope of Home Inspection," it states; "The purpose of this inspection is to identify visual material defects . . . ." The following paragraph ("Limited Inspection Guarantee") reads; "This Guarantee provides partial reimbursement for repair expenses, including those incurred as a result of alleged inspector negligence, when eligible Elements are documented in the Report to be in satisfactory condition." (Italics supplied). The paragraph further limits the reimbursement to "an aggregate of $1,500.00 per element." The next paragraph ("Company Liability") and includes the statement; "The Client understands that the inspection without this limitation of liability would have to be more technically exhaustive, would likely require the services of specialists, and would cost substantially more than the fee for this inspection." Finally, the agreement recites that more extensive inspection services including "a reinspection of any inaccessible or concealed Element" (emphasis original) are available upon request at an additional cost.

A separate page without signature lines attached to the agreement is entitled "Additional Terms and Conditions." The first paragraph entitled, "Inspection Limitations/Exclusions," states; "The Inspection and Report are limited to specified visible and readily accessible Elements of the Dwelling at the time of the inspection. The inspection will not be invasive or technically exhaustive, and cannot detect latent conditions or concealed, hidden, obstructed or inaccessible areas. . . . It is not possible to determine or predict water leakage, moisture problems, or other conditions that might be affected by varying weather conditions, environmental factors, or lifestyle."

A second paragraph expressly excludes from the scope of the inspection mold or other potential contamination or health risk. Another document separately signed by Joshua Dicker on July 2, 2004 is entitled "Important Mold Information" stresses that the inspection is "neither a mold detection/identification evaluation nor a mold insurance policy."

The inspection took place the same day and the inspector presented Plaintiffs with a written "Express Report." The introductory portion of the report includes in bold type under the definition of "fair;" "An element rated FAIR requires, or has at least a moderate probability of requiring, monitoring, maintenance, repair, replacement, and/or other remedial work now or in the near future."

The areas of the premises that gives rise to the present action were the bathroom attached to the master bedroom identified in the report as "Bathroom No.2" and the ceiling of the garage below. For both the shower and tile work in this bathroom the rating checked off by the inspector was "fair" and he commented;

"Tilework has been repaired and sealed. Original shower." The walls/ceilings of the garage underneath it were rated "satisfactory" with the comment; "Rear area at ceiling has prior water damage (dry)." [*2]

The affidavit of Plaintiff Joshua Dicker submitted in opposition to this motion avers that he and his wife purchased the house in reliance on Defendant Hennessey's oral assurances about the condition of 17 The Tulips and his written inspection report. However, neither the Verified Complaint nor the Affidavit in Opposition recite any "oral assurances" and Plaintiff's affidavit simply states that Defendant Hennessy failed to mention the possibility of an existing water leak or potential water damage in his conversations with the Plaintiffs during and after the inspection. Upon taking possession Plaintiffs discovered that there was an active water leak in the bathroom in question and extensive rot and mold in the floor below the shower. Significant repair and renovation work was required to correct the condition.

Discussion

The Defendants contracted to perform the home inspection knowing that Plaintiffs were contemplating the purchase of the house in question. The Defendants thereby assumed the duty to perform the inspection with reasonable care. (see, Sommer v Federal Signal Corp., 79 NY2d 540 (1992)). A home inspector who fails to exercise reasonable care in performing an inspection may be liable for simple negligence or professional negligence depending upon the character of the defect alleged to have been overlooked. (Kohl v Green, 235 AD2d 671 [3d Dept, 1997]).

In the instant case, however, the written agreement between the Plaintiffs and the Defendants purports to limit liability in a variety of ways. The scope of the inspection is limited to "visual material defects" and offers a "reinspection of any inaccessible or concealed element" at an additional fee. Reimbursement is limited "an aggregate of $1,500.00 per element" and then only for elements reported to be in satisfactory condition.

Public policy will not permit a party to insulate itself from liability for gross negligence (Sommer v Federal Signal Corp., 79 NY2d 540, 554 (1992)). Nevertheless, absent legislation to the contrary, a contractual provision absolving a party from liability for ordinary negligence will be enforced particularly

where the limitation makes the service more affordable (see, Eaves Brooks Costume Co. v Y.B.H. Realty,76 NY2d 220, 227 (1990)) or full liability is offered at an additional cost (see, Ciofalo v Vic Tanny Gyms, 10

NY2d 294 (1961)). Accordingly, limitations of liability in home inspection contracts have been enforced. (Rector v Calamus Corp., 17 AD2d 960 [3d Dept, 2005]; Ricciardi v. Frank, 170 Misc 2d 777 (App. Term, 2d Dept, 1996)).

The Legislature has recently enacted Article 12-B of the Real Property Law entitled "Home Professional Inspection Licensing" that for the first time undertakes to regulate home inspections. A "State Home Inspection Council" has been created to set standards for and license home inspectors. (Real Property Law § 444-c). The Legislature has also required that licensed home inspectors maintain liability insurance. (Real Property Law § 444-k). Of course, this legislation, effective Dec. 31, 2005 (Laws 2004, Ch. 461, § 2, as amended by Laws 2005, Ch. 225, § 11) applies only prospectively (Murphy v Board of Education, 104 AD2d 796, aff'd 64 NY2d 64 NY2d 856) and no standards have been promulgated as yet. Nevertheless the Legislature's silence with respect to contractual limitations of liability is significant and must be [*3]construed as intentional. (Pajak v Pajak, 56 NY2d 394, 397 (1982)). Contractual limitations of liability in home inspection contracts continue to be enforceable.

Summary judgment may be granted enforcing a clear contractual provision limiting damages for the negligent performance of a home inspection absent the allegation of facts in the complaint or bill of particulars tending to establish gross negligence. (Rector v Calamus Corp., 17 AD2d 960 [3d Dept, 2005]; see, Ricciardi v. Frank, 170 Misc 2d 777 (App. Term, 2d Dept, 1996)). However, Defendant's motion to dismiss is based upon CPLR 3211(a)(1), a defense based upon documentary evidence, and such a motion will only be granted if the documentary evidence resolves all the factual issues as a matter of law and definitively disposes of the Plaintiff's claim. (See, Topel v Reliastar Life Ins. Co., 6 AD3d 608 [2d Dept, 2004]; European American Bank v Miller, 265 AD2d 374 [2d Dept, 1999]). Here, the clear language of the contract precludes any claim based upon the condition of the shower and tile work in "Bathroom #2" which were rated only "fair" there being no allegations of gross negligence. It similarly bars recovery of any damages attributable to mold. However, the same cannot be said as to the garage ceiling which was rated "satisfactory" although

any recovery based upon the inspection with respect to the garage ceiling would be subject to the $1,500.00 per element recovery limitation.

The defendants are directed to serve and file an Answer in this action within 30 days of service of this Order.

A preliminary conference (22NYCRR 202.12) shall be held at the Preliminary Conference Desk, in the lower level of the Nassau County Supreme Court, on the 23rd of February, 2006, at 2:30 p.m. This directive with respect to the date of the conference is subject to the right of the Clerk to fix an alternate date should scheduling require. Counsel for the movant shall serve a copy of this Order on all parties. A copy of the Order with affidavits of service shall be served on the DCM Clerk within seven (7) days after entry.

It is, SO ORDERED.

Dated: February 9, 2006 _________________________________

HON. GEOFFREY J. O'CONNELL, J.S.C.