Court Opinion

ID: 5932517
Source: CourtListenerOpinion
Date Created: 2022-01-13 05:13:32.519342+00
Date Added: 2024-06-11T08:46:52.406242
License: Public Domain

Smith, J. (dissenting).
I would affirm the dismissal of the complaint by the motion court.
Plaintiff seeks to rescind his contract to purchase defendant Ackley’s residential property and recover his down payment. Plaintiff alleges that Ackley and her real estate broker, defendant Ellis Realty, made material misrepresentations of the property in that they failed to disclose that Ackley believed that the house was haunted by poltergeists. Moreover, Ackley shared this belief with her community and the general public through articles published in Reader’s Digest (1977) and the local newspaper (1982). In November 1989, approximately two months after the parties entered into the contract of sale but subsequent to the scheduled October 2, 1989 closing, the house was included in a five-house walking tour and again described in the local newspaper as being haunted.
Prior to closing, plaintiff learned of this reputation and unsuccessfully sought to rescind the $650,000 contract of sale and obtain return of his $32,500 down payment without resort to litigation. The plaintiff then commenced this action for that relief and alleged that he would not have entered into the contract had he been so advised and that as a result of the alleged poltergeist activity, the market value and resaleability of the property was greatly diminished. Defendant Ackley has counterclaimed for specific performance.
"It is settled law in New York State that the seller of real property is under no duty to speak when the parties deal at arm’s length. The mere silence of the seller, without some act or conduct which deceived the purchaser, does not amount to a concealment that is actionable as a fraud (see, Perin v Mardine Realty Co., 5 AD2d 685, affd 6 NY2d 920; Moser v Spizzirro, 31 AD2d 537, affd 25 NY2d 941). The buyer has the duty to satisfy himself as to the quality of his bargain pursuant to the doctrine of caveat emptor, which in New York State still applies to real estate transactions.” (London v Courduff, 141 AD2d 803, 804 [1988], lv dismissed 73 NY2d 809 [1988].)
The parties herein were represented by counsel and dealt at arm’s length. This is evidenced by the contract of sale which, inter alia, contained various riders and a specific provision *262that all prior understandings and agreements between the parties were merged into the contract, that the contract completely expressed their full agreement and that neither had relied upon any statement by anyone else not set forth in the contract. There is no allegation that defendants, by some specific act, other than the failure to speak, deceived the plaintiff. Nevertheless, a cause of action may be sufficiently stated where there is a confidential or fiduciary relationship creating a duty to disclose and there was a failure to disclose a material fact, calculated to induce a false belief. (County of Westchester v Becket Assocs., 102 AD2d 34, 50-51 [1984], affd 66 NY2d 642 [1985].) However, plaintiff herein has not alleged and there is no basis for concluding that a confidential or fiduciary relationship existed between these parties to an arm’s length transaction such as to give rise to a duty to disclose. In addition, there is no allegation that defendants thwarted plaintiffs efforts to fulfill his responsibilities fixed by the doctrine of caveat emptor. (See, London v Courduff, supra, 141 AD2d, at 804.)
Finally, if the doctrine of caveat emptor is to be discarded, it should be for a reason more substantive than a poltergeist. The existence of a poltergeist is no more binding upon the defendants than it is upon this court.
Based upon the foregoing, the motion court properly dismissed the complaint.
Ross and Kassal, JJ., concur with Rubin, J.; Milonas, J. P., and Smith, J., dissent in an opinion by Smith, J.
Judgment, Supreme Court, New York County, entered on April 9, 1990, modified, on the law and the facts, and in the exercise of discretion, and the first cause of action seeking rescission of the contract reinstated, without costs.