Court Opinion

ID: 9627832
Source: CourtListenerOpinion
Date Created: 2023-08-22 08:56:11.594694+00
Date Added: 2024-06-11T18:06:51.258056
License: Public Domain

Dore, J.
(dissenting) — Contrary to the majority, I believe that a broker should be liable for any material misrepresentation he or she makes which induces buyers to act to their detriment. Furthermore, even applying the majority's far more lax standard of care, I would find the broker liable in this case. Therefore, I dissent.
Liability for "Innocent" Misrepresentations
The majority discusses whether or not brokers should be held liable for innocent misrepresentations and concludes that brokers need only "take reasonable steps to avoid dis*80seminating to the buyer false information." Majority, at 75, quoting Tennant v. Lawton, 26 Wn. App. 701, 615 P.2d 1305 (1980). The most recent commentary on this issue has concluded the opposite.
Upon comparison of the strengths and weaknesses of the current legal views, the approach which appears to most effectively balance the equities between broker and buyer is one which recognizes realtor liability for innocent misrepresentation, as well as a limited and clearly defined realtor duty of inspection for defects.
Note, Realtor Liability for Innocent Misrepresentation and Undiscovered Defects: Balancing the Equities Between Broker and Buyer, 20 Val. U. L. Rev. 255, 271 (1986). I concur with this second view.
Washington courts have long held that a seller of land is always liable for misrepresentations, regardless of whether they are innocently or negligently made. Lawson v. Vernon, 38 Wash. 422, 80 P. 559 (1905); McRae v. Bolstad, 32 Wn. App. 173, 177, 646 P.2d 771 (1982). The basis for this rule is the belief that the owners are presumed to know the attributes and specifications of their property. Hoffman v. Connall, 43 Wn. App. 532, 538, 718 P.2d 814 (1986). I agree with this rule and I see no reason not to apply this logic to brokers. Brokers possess more knowledge than buyers about the attributes of the property to be sold, and innocent buyers should be able to rely on representations made by the broker. I would follow the increasing trend of state courts to impose liability on real estate brokers for any kind of misrepresentation. Note, 20 Val. U. L. Rev., at 271. See, e.g., Bevins v. Ballard, 655 P.2d 757 (Alaska 1982); Gauerke v. Rozga, 112 Wis. 2d 271, 332 N.W.2d 804 (1983).
In this case, both the majority and I conclude that the broker made a material misrepresentation which induced the Hoffmans to purchase the land, and that as a result, the Hoffmans incurred significant damages. The broker represented the property line to be located some 20 feet from where it actually was; consequently the corral, cattle run and horse shed all had to be moved so as not to encroach *81on their neighbor's land. Even if the majority is correct and this misrepresentation was innocently, and not negligently, made — a conclusion I dispute — I would still hold the broker liable. Between innocent purchasers, who may justifiably rely on the broker's knowledge and expertise, and a broker, who is in a far better position to check the accuracy of any purported boundary lines, I believe the broker should be liable for any misrepresentation as to the boundary's location. Equity demands such a result.
The Tennant Approach
The majority cites Tennant v. Lawton, 26 Wn. App. 701, 615 P.2d 1305 (1980) for the proposition that the rule of law should be "that the broker is liable because of material representations of the principal if he repeats them and knows, or reasonably should know, of their falsity." Tennant, at 706. While I note in passing that this decision is in conflict with our earlier decision in Lawson v. Vernon, supra, I believe that even following the rule set forth in Tennant, the broker in this case should still be liable.
The broker in this case testified that Mr. Connall was emphatic about the boundary of his property and that an earlier survey had indicated that his property ended just to the east of where he built his fence. Report of Proceedings, at 167-68. Nevertheless, an expert witness testified that any such survey would be a public record, and that no survey had been made of this property. Report of Proceedings, at 25. While under the standard of care propounded by the majority, a reasonably prudent broker would not be required to verify the accuracy of Connall's comments by a detailed investigation of the survey that Connall believed had been completed, the broker should at least verify the existence of the survey. This he did not do, and this failure, even under the majority's standard of care, was a breach of the duty "to take reasonable steps to avoid disseminating to the buyer false information." Tennant, at 706. Thus, even under the majority's more lax standard of care, the broker was negligent, and therefore, liable for the damages to the Hoffmans.
*82Conclusion
I believe the majority ignores the equities of the broker-buyer relationship by allowing brokers to misrepresent material aspects of the property in question with impunity unless the buyer demonstrates that the broker knew or should have known of the statement's falsity. As between an innocent buyer and an innocent broker, I believe the buyer should prevail. Even following the majority's proposed standard of care, if a seller bases his belief of the location of the property line on a prior survey, I believe that a reasonably prudent broker would verify the purported survey does in fact exist. Failure to make this simple inquiry is negligence and actionable even under the majority's reasoning. I therefore dissent.
I would uphold the Court of Appeals decision in favor of the Hoffmans, and would remand for determination of damages.
Goodloe, J., concurs with Dore, J.
Reconsideration denied June 18, 1987.