Case Title: Steiber v. PALUMBO

Citation: 219 Or. 479, 347 P.2d 978

Docket Number: 

State: oregon

Court: Oregon Supreme Court

Date: 1959-12-23T00:00:00Z

Document:
219 Or. 479 (1959)
347 P.2d 978
STEIBER
v.
PALUMBO ET AL

Supreme Court of Oregon.
Submitted December 2, 1959.
Affirmed December 23, 1959.
Nicholas Granet, Portland, filed a brief for appellant.
Wilber Henderson, Portland, filed a brief for respondent.
AFFIRMED.
*480 ROSSMAN, J.
This is an appeal by the plaintiff from a judgment which the circuit court entered in the defendants' favor after it had sustained the defendants' motion for an involuntary nonsuit. The action was based upon a contention that when the defendants sold to the plaintiff a new house, February 27, 1951, the law implied in her favor a warranty of good quality and that the warranty was breached to the plaintiff's damage. The defendants are four in number: A and A Construction Co., Inc., a corporation, together with Anton, Louis and Alex Palumbo. Title to the property, a city lot in Portland, was vested in the corporation. The Palumbos were the builders of the house and were the officers of the corporation. The construction of the house was complete when the plaintiff inspected and purchased it. Its purchase price was $7400.
An averment of the complaint states:
The complaint further alleged that the house "was not built on firm land, but on the contrary was built upon a `fill' which was not solid, was unstable, and incapable of supporting said house, all in breach of defendant's said warranty. * * * said house has settled and settled unevenly * * *." The complaint makes no charge of fraud, misrepresentation, overreaching, breach of express agreement or lack of opportunity for adequate inspection before purchase.
*481 The answer denied the complaint's charges. We will assume that the evidence supports the charge that the house was built upon a fill and that it settled in such a manner that its usefulness and value were materially impaired.
The plaintiff's (appellant's) brief, with commendable frankness, states:
In sustaining the defendants' motion for a nonsuit the trial judge ruled: "* * * there is no such thing as an implied warranty in connection with the sale of real property."
The plaintiff presents only this assignment of error:
1. The complaint was not filed until almost six years after the plaintiff had purchased the property. Before the purchase the plaintiff inspected the house and lot to the extent that she wished. In the consummation of the transaction only three papers were employed: an earnest money receipt, a deed and a mortgage. The mortgagee was not any of the defendants. None of the three papers contains any warranty of the quality of the house or the character of the soil under it. In fact, none of the papers employs the word *482 "house" or any equivalent of that term. The deed contains the usual warranties of title but no others. It is apparent that if the plaintiff is entitled to prevail she must do so on the basis of an implied warranty. The purchase money receipt was signed February 27, 1951. The deed was signed and delivered May 8, 1951.
ORS 93.140 provides:
The domain of that language is very extensive. It would be impossible to broaden it.
Williston on Contracts, revised edition, § 926, states:
No decision has come to our attention which permitted recovery by the vendee of housing upon a theory of implied warranty although Allison Dunham, *483 "Vendor's Obligation as to Fitness of Land for a Particular Purpose," 77 Minn Law Rev 108 (1953) argues that the law will move in this direction in the case of the supplier of new housing. Professor Dunham reasons that in this situation the vendee should have a right to rely on the contractor's skill and judgment that the house is fit for habitation. No such right would arise, as that author concedes, in the resale of used housing since the vendor normally has no greater skill than the buyer. As to the present state of the law Professor Dunham reports it as follows:
Possibly one can detect sympathy with Professor Dunham's views as to the future of the law in Levy v. C. Young Construction Co., 26 NJ 330, 139 A2d 738 (1958), affirming 46 NJ Super 293, 134 A2d 717 (1957). The purchaser of a new house had difficulty with the sewer line starting a year after the sale and was put to considerable expense to correct the difficulty. Then he sued the contractor on the theory of implied warranty, and recovered a judgment in the trial court. This judgment was reversed in the superior court, Justice Waesche dissenting. The majority said:
Judge Waesche, in his dissent, argued as follows:
The Supreme Court of New Jersey affirmed the superior court's dismissal of the suit, but did not adopt the reasoning of the majority. It based affirmance on the sole ground that the evidence affirmatively showed the contractor was not at fault. It said:
In Harmon Nat. Real Estate Corporation v. Egan, 137 Misc Rep 297, 241 NYS 708 (1930), suit was brought by a mortgagee and the defendant mortgagor counterclaimed on the ground "that at the time the house was sold to the defendant, the plaintiff well knew that the same was uninhabitable." The court said:
The New York statute cited by the court (Real Property Law § 251) as support for its holding "No implied covenant arises from a conveyance of real property" is the same as ORS 93.140.
Kerr v. Parsons, 83 Ohio App. 204, 82 NE2d 303 (1948), was based upon the plaintiff's purchase of a second-hand house. After purchase he brought an action for damages against the seller on the ground that the latter had falsely represented that a well on the premises would supply enough water for household uses. A verdict and judgment for the defendant were reversed because of prejudicial instructions. Inter alia it was noted that the trial court had charged as to warranty. In reversing, the appellate court said:
Shapiro v. Kornicks, 103 Ohio App 49, 124 NE2d 175 (1955), followed Kerr v. Parsons. In that case plaintiff purchased a newly completed house from the defendant building contractor. Thereafter the following defects, according to the plaintiff, developed: "leaking basement, crumbling front steps, cracked front door, radial cracks in basement floor, support column for steel beam, dark red stain in back and insufficient *487 coats of paint." Plaintiff sued for damages and recovered judgment. His theory of the case was express or implied warranty. The judgment was reversed, the court holding upon the authority of Kerr v. Parsons that there was no implied warranty.
In Dennison v. Harden, 29 Wash 2d 243, 186 P2d 908 (1947), plaintiff had purchased land on which there was an orchard. In suing for damages, oral evidence was offered that the defendant seller had warranted the trees to be of a particular commercial species but that they were in fact scrubs. The testimony was excluded and a judgment of dismissal rendered. In contending that the parol evidence should have been admitted, plaintiff argued on appeal, inter alia, that there was an implied "warranty of variety." The court dismissed this argument, stating:
In Berger v. Burkoff, 200 Md 561, 92 A2d 376 (1952), the plaintiffs purchased new homes from defendant building contractor and discovered that their basements were improperly waterproofed. They sued for damages on the theory that "the Defendants warranted to the Plaintiffs that the basement of said premises * * * was waterproofed and would remain dry * * *." Summary judgment for the defendant contractor was granted and affirmed on appeal. The court said:
A recent New York decision has also refused to find an implied warranty where the builder failed to waterproof a basement. Dolezel v. Fialkoff, 2 AD2d 642, 151 NYS2d 734 (1956, AD3d).
In Combow v. Kansas City Ground Investment Company, 358 Mo 934, 218 SW2d 539, 8 ALR2d 213 (1949), the plaintiff and her husband purchased from the defendant an old house which the defendant had extensively remodeled. Six days after the completion of the transaction the plaintiff was injured when the ceiling plaster of one of the rooms fell upon her. She thereupon sued in tort for her personal injuries. At the close of the evidence the trial court sustained the defendant's motion for a directed verdict. In affirming the judgment the Supreme Court said:
The English courts also recognize that there is no warranty implied in the sale or lease of real estate. Hart v. Windsor, 12 M & W 68, 152 Eng Rep 1114 (1843). The plaintiff sued for rent under a lease, and the defense was that the leased premises were insect infested and uninhabitable. Baron Parke said, "We are all of opinion, for these reasons, that there is no contract, still less a condition, implied by law on the demise of real property only, that it is fit for the purpose for which it is let." Accordingly, judgment was given for the plaintiff.
A discourse entitled "Right of Purchaser in Sale of Defective House," 4 Western Reserve Law Review 357 (1958) accompanies an extensive review of the case law with this observation:
2. It will be noticed from the foregoing that even apart from legislation such as ORS 93.140 the law *490 refuses to imply in favor of the purchaser of an existing house warranties as to quality. As to purchasers of that kind the rule of caveat emptor applies and he must reduce his purported warranties to written contractual form if he expects to base an action upon them. If he neglects to do so, a court is precluded by ORS 93.140 from summoning to his avail implied warranties.
The plaintiff's assignment of error can not be sustained.
The challenged judgment is affirmed.