Title: Norris v. Mitchell
Citation: N/A
Docket Number: 970461
State: Virginia
Issuer: Virginia Supreme Court
Date: January 9, 1998

Present:  Compton, Lacy, Hassell, Keenan, Koontz, and Kinser, 
JJ., and Whiting, Senior Justice 
 
DAVID S. NORRIS, ET AL. 
                                            OPINION BY  
v. Record No. 970461 
SENIOR JUSTICE HENRY H. WHITING 
                                          January 9, 1998 
CALVIN D. MITCHELL, JR., ET AL. 
 
 
FROM THE CIRCUIT COURT OF MATHEWS COUNTY 
 
John M. Folkes, Judge 
 
 
In this appeal, we decide (1) at what point an order that 
sustained a demurrer and dismissed an action but gave the 
plaintiffs leave to amend within a certain period became final, 
and (2) whether the circumstances of this case required sellers 
of residential property to disclose to the purchasers the 
contents of a public document describing a restriction on the use 
of the property being sold.   
 
The trial court decided the case by sustaining the 
defendants' demurrer.  Therefore, we accept as true the following 
material facts expressly alleged in the motion for judgment and 
all reasonable inferences which may be fairly drawn from those 
facts.  Heyward & Lee Constr. Co. v. Sands, Anderson, Marks & 
Miller, 249 Va. 54, 55, 453 S.E.2d 270, 271 (1995). 
 
Calvin D. Mitchell, Jr., and Marie D. Mitchell, husband and 
wife (the sellers), contracted to sell a house and lot in the 
Chesapeake Shores subdivision in Mathews County to David S. 
Norris and Agnes A. Norris, husband and wife (the purchasers).  
The contract was "contingent upon satisfactory reports from a 
qualified . . . septic inspection." 
 
Cindy Fox, the sellers' real estate agent, arranged to have 
Allen S. Farmer perform the septic inspection.  After doing so, 
Farmer wrote Fox that the "septic System is not operating 
properly at this time."  Upon being notified by Fox of the 
results of Farmer's inspection, the purchasers told Fox that the 
septic system would have to be repaired before settlement.  Fox, 
acting for the sellers, employed Farmer to make the necessary 
repairs.  Farmer obtained a construction permit from the county 
containing the following provisions:  "Recommendations:  
Summertime use, no laundry, aerated faucets, low flush toilets[.] 
 Conserve water." 
 
After Farmer completed his work and certified that the 
"septic system had been installed and completed in accordance 
with the construction permit," the system was inspected and 
approved by the county.  Although they were told that the system 
had been repaired, the purchasers were not given a copy of the 
permit.  Nor were they told of the reservations noted on the 
permit prior to closing, even though they had advised Fox that 
they planned to have their son occupy the house on a "year-round 
basis."   
 
The parties completed the sale on September 13, 1994, and 
the purchasers took possession of the property.  Thereafter, they 
made substantial improvements to the house. 
 
Almost immediately after the purchasers' son began living in 
the house in January, 1995, he "experienced difficulty with the 
use of the toilet."  When the purchasers asked Fox what Farmer 
had done to the septic system to repair it, Fox sent them a copy 
of the construction permit containing the above-quoted 
restrictions.  This was the first time the purchasers became 
aware of the restrictive language in the permit. 
  
Upon being advised that they would be required to "expend 
substantial funds to upgrade the septic system in order that the 
property [could] be used on a year-round basis," the purchasers 
sued the sellers and the attorney who represented all the parties 
at the closing.  Among other things, the purchasers claimed 
breaches of a duty to give them a copy of the construction permit 
and to advise them of the restrictions noted thereon.  Concluding 
that the purchasers' motion for judgment failed to state a cause 
of action, the court sustained demurrers filed by the defendants 
and dismissed the action in a written order entered June 20, 
1996. 
 
However, the order granted the purchasers leave to file an 
amended motion for judgment on or before July 8, 1996.  Three 
days before the July 8 deadline, the purchasers filed a motion 
for a nonsuit which the court granted in a written order entered 
on July 15, 1996.  That order was entered more than 21 days after 
the June 20 order, but less than 21 days after the July 8 
deadline.   
 
In August 1996, the purchasers again sued the sellers, 
making the allegations described earlier and this time claiming 
that the sellers had committed an act of fraud.
1  After 
sustaining the sellers' plea of res judicata and a demurrer, the 
court dismissed the second action.  The purchasers appeal. 
 
First, we decide whether the court correctly sustained the 
                     
 
1Although the purchasers also sued Fox and her employer, the 
trial court's dismissal of the action against them has not been 
appealed. 
sellers' plea of res judicata.  The sellers contend that the 
court was correct because the dismissal order in the first action 
was a final order effective on the date it was entered and, under 
Rule 1:1, the court lost jurisdiction to enter the nonsuit order 
more than 21 days after that effective date.
2  The purchasers 
argue that the sellers cannot now contest the validity of the 
nonsuit order since they did not appeal the judgment of the court 
in entering the nonsuit order.   
 
If the dismissal order were a final order, the court would 
have lost jurisdiction to enter the order of nonsuit more than 21 
days after the dismissal order was entered, even though the 
purchasers' motion for a nonsuit was filed within 21 days after 
the dismissal order was entered.  School Bd. v. Caudill Rowlett 
Scott, Inc., 237 Va. 550, 556, 379 S.E.2d 319, 323 (1989).  We 
resolve this issue by a consideration of the effect of an order 
sustaining demurrers to the merits of a case and dismissing it.  
If the order merely sustains such a demurrer, it is not a final 
order; to be final, it must go further and dismiss the case.  
Bibber v. McCreary, 194 Va. 394, 395, 73 S.E.2d 382, 383 (1952). 
 However, if the order also gives the plaintiff leave to amend, 
it does not become final "until after the time limited therein 
for the plaintiff to amend his bill has expired."  London-
Virginia Mining Co. v. Moore, 98 Va. 256, 257, 35 S.E. 722, 723 
                     
 
2Rule 1:1 provides in pertinent part: 
 
 
 
All final judgments, orders, and decrees, irrespective 
of terms of court, shall remain under the control of the 
trial court and subject to be modified, vacated, or 
suspended for twenty-one days after date of entry, and no 
longer. 
(1900). 
 
Hence, the dismissal order in question could not have become 
final until the July 8 deadline.  Thus, the court had 21 days 
after that time in which to "modif[y], vacate[], or suspend[]" 
its order.  Rule 1:1.  Within that time, the court modified its 
order sustaining the sellers' demurrer by entering its order of 
nonsuit, which became the final order in the case.  Thus, the 
order of June 20, sustaining the demurrer and dismissing the 
first action, was not a final order, an essential element for the 
imposition of the doctrine of res judicata.  Arkansas Best 
Freight Sys., Inc. v. H.H. Moore, Jr. Trucking Co., 244 Va. 304, 
307, 421 S.E.2d 197, 198 (1992); Faison v. Hudson, 243 Va. 413, 
419, 417 S.E.2d 302, 304 (1992).  Accordingly, we conclude that 
the trial court erred in sustaining the sellers' plea of res 
judicata. 
 
And since the sellers did not appeal the trial court's 
action in granting the nonsuit, the order of nonsuit became the 
final order in the first action and the law of this case.  Walt 
Robbins, Inc. v. Damon Corp., 232 Va. 43, 49, 348 S.E.2d 223, 
227-28 (1986); Searles v. Gordon, 156 Va. 289, 294, 157 S.E. 759, 
761 (1931).  Therefore, we treat the order as correctly entered. 
 
Next, we turn to the merits of the trial court's ruling in 
sustaining the sellers' demurrer.  Because of the absence of any 
allegations by the purchasers that the sellers intentionally 
concealed the limitations upon the use of the septic system noted 
in the construction permit, the sellers argue that the trial 
court was correct in its ruling. 
 
The purchasers respond that their allegation of the failure 
of the sellers or Fox, their agent, to show them the construction 
permit or advise them of its limitations, was tantamount to an 
allegation of false representation, citing Van Deusen v. Snead, 
247 Va. 324, 328, 441 S.E.2d 207, 209 (1994), and Spence v. 
Griffin, 236 Va. 21, 28, 372 S.E.2d 595, 598-99 (1988), in 
support.  We find no merit in this contention. 
 
The purchasers recognize that one of the essential elements 
of their cause of action for fraud is "a false representation."  
Van Deusen, 247 Va. at 327, 441 S.E.2d at 209.  The purchasers 
alleged that the sellers "committed an act of fraud when they 
concealed from [them] the reservations noted on the septic Permit 
which information [the purchasers] had a right to expect 
disclosure."  Thus, the purchasers equate concealment with a 
failure to perform a duty to disclose.   
 
However, we have held that  
 
 
[f]or purposes of an action for fraud, 
concealment, whether accomplished by word or conduct, 
may be the equivalent of a false representation, 
because concealment always involves deliberate 
nondisclosure designed to prevent another from learning 
the truth.  A contracting party's willful nondisclosure 
of a material fact that he knows is unknown to the 
other party may evince an intent to practice actual 
fraud.  
 
 
Van Deusen, 247 Va. at 328, 441 S.E.2d at 209 (quoting Spence, 
236 Va. at 28, 372 S.E.2d at 598-99) (emphasis added).  
Therefore, we have required either an allegation or evidence of a 
knowing and a deliberate decision not to disclose a material 
fact. 
 
The Van Deusen amended bill of complaint alleged 
 
 
that [the sellers of a residence] had "put new 
mortar in cracks around the foundation" and placed 
"materials and the like in front" of cracks in the 
basement to prevent the prospective purchasers "from 
detecting the defects of the house" and "for the 
purpose of diverting their attention from the 
settlement of the house."  
 
247 Va. at 329, 441 S.E.2d at 210.  In Spence, to induce the 
donor-grantor of a charitable gift of land not to read the deed 
carefully, the donee-grantee and his agent represented to the 
grantor that the deed contained a reversionary clause as the 
grantor intended when they knew it did not.  236 Va. at 29, 372 
S.E.2d at 599. 
 
Here, however, there is no allegation of a deliberate 
decision to conceal from the purchasers the limitations of use 
noted on the construction permit.  Indeed, the construction 
permit was an official record, Code § 2.1-341, available for 
inspection by the public under the provisions of Code § 2.1-
342(A), and required to be posted on the property before the work 
began.  Code § 43-4.01(A).  And the purchasers do not allege that 
the sellers did anything to divert them from inspecting the 
permit. 
 
Additionally, the doctrine of caveat emptor required the 
purchaser to discover defects in the property which a reasonable 
inspection would have disclosed, unless the sellers did or said 
anything to "divert [the purchasers] from making the inquiries 
and examination which a prudent man ought to make."  Horner v. 
Ahern, 207 Va. 860, 864, 153 S.E.2d 216, 219 (1967).  As we have 
noted, there is no claim that the sellers diverted them from 
inspecting the permit.  The purchasers merely claim that the 
sellers had an affirmative duty to call their attention to the 
restrictions.  We hold that there was no such duty under the 
circumstances of this case. 
 
Accordingly, we find no error in the action of the trial 
court in holding that the purchasers had not alleged a cause of 
action for fraud.  For this reason, we will affirm the judgment 
of the trial court. 
 
Affirmed.