Court Opinion

ID: 4402883
Source: CourtListenerOpinion
Date Created: 2019-06-03 18:43:51.154622+00
Date Added: 2024-06-11T14:52:13.037236
License: Public Domain

[Cite as Psarras v. Rayburn, 2019-Ohio-2168.]

                                    IN THE COURT OF APPEALS

                                ELEVENTH APPELLATE DISTRICT

                                      GEAUGA COUNTY, OHIO

 JAMES P. PSARRAS, et al.,                      :        OPINION

                  Plaintiff-Appellant,          :
                                                         CASE NO. 2018-G-0181
         - vs -                                 :

 SARAH M. RAYBURN, TRUSTEE,                     :

                  Defendant-Appellee.           :

 Civil Appeal from the Geauga County Court of Common Pleas, Case No. 2013 M
 000943.

 Judgment: Affirmed.

 Jonathan P. Blakely, P.O. Box 217, Middlefield, OH 44062 (For Plaintiff-Appellant).

 Elaine Tassi, 34955 Chardon Road, Willoughby Hills, OH           44094 (For Defendant-
 Appellee).

MARY JANE TRAPP, J.

        {¶1}      Appellant, James P. Psarras, M.D., appeals from the judgment of the

Geauga County Court of Common Pleas, which found that he breached a combined lease

and residential real estate purchase agreement with appellee, Sarah M. Rayburn, trustee,

by not completing the purchase of the property at issue. During the summary judgment

phase of this matter, the court found Ms. Rayburn violated the lease and Ohio’s Landlord

Tenant Law, Chapter 5321, by failing to make necessary repairs to prevent flooding in the

residence. After the trial, however, the court found Dr. Psarras failed to offer sufficient
evidence to support his damage claim. The court also awarded Dr. Psarras interest on

the security deposit and Ms. Rayburn damages for the breached purchase agreement by

subtracting the eventual sale price from the contracted purchase price.

        {¶2}   Dr. Psarras now appeals, arguing flooding issues on the property negated

his obligation to purchase the property. We disagree and affirm the trial court’s judgment.

Dr. Psarras signed a residential disclosure form, which disclosed the past flooding issue.

He then waived his right to any inspection of the property even though he saw sump

pumps in the basement of the residence before he signed the lease agreement with a

purchase addendum and a separate residential real estate purchase agreement that

contained an “as is” clause.

                         Substantive and Procedural History

        {¶3}   Ms. Rayburn, as trustee, and Dr. Psarras, together with his now deceased

wife, Elaine Psarras, M.D. (collectively “Dr. Psarras”), entered into a lease agreement

with a purchase addendum and a separate purchase agreement to purchase real property

located at 3063 Forest Drive, Pepper Pike, Ohio. In order to allow Dr. Psarras sufficient

time to sell their Shaker Heights home and have the funds needed to purchase the Pepper

Pike home, the parties agreed Dr. Psarras, his wife, as well as their daughter and son-in-

law would lease the property beginning December 16, 2009 to August 15, 2010. The

purchase agreement provided that the sale of the property would close on August 15,

2010.

        {¶4}   Prior to signing either agreement, Dr. Psarras received a residential

disclosure form, which Ms. Rayburns’ parents, the beneficiaries of the trust, completed

and signed on July 8, 2008. Ms. Rayburns’ parents disclosed a previous water intrusion,

                                            2
describing the water leakage as follows: “basement flooded after rain – repaired new

pumps in place, outdoor and indoor piping replaced new grates placed in front yard.” Dr.

Psarras waived his right to an inspection of the water intrusion and signed the residential

disclosure form on October 8, 2009.

       {¶5}   Approximately a month later, on November 3, 2009, Dr. Psarras signed the

lease/purchase and residential real estate purchase agreements. He testified he was

being advised by counsel, but counsel did not negotiate the terms. Although the record

is unclear, it appears Dr. Psarras did not have or does not recall having any of the

documents at issue reviewed by his attorney before execution.

       {¶6}   Both the lease/purchase and purchase agreements contained integration

clauses. The lease agreement required rent of $20,000 for the lease term, or $2,500 per

month, including the payment of the last monthly installment upon the execution of the

lease agreement as a deposit. The pre-printed lease agreement form at paragraph 3,

“Damage Deposit,” called for “ZERO DOLLARS.”            The lease further provided via a

handwritten interlineation that “[t]enant accepts premises ‘as is.’” Pursuant to paragraph

20, “Default,” if Dr. Psarras failed to pay rent for seven days, Ms. Rayburn was entitled to

“declare the entire balance of rent due and payable” and to “exercise all rights/remedies

available to the landlord at law or equity”, or could “elect to terminate” the lease, “the

purchase agreement and retain all amounts paid.”          (Emphasis added to show the

handwritten addition by interlineation.)

       {¶7}   In the lease addendum Dr. Psarras agreed to pay $510,000 for the

purchase of the home. In the separate purchase agreement, the purchase price of

$510,000 was restated, and that agreement also required earnest money of $51,000 to

                                             3
be paid in two payments. The first payment, $25,000, was due upon signing. The second

payment, $26,000, was due January 31, 2010, leaving a balance of $459,000 to be paid

on or before the closing date. Dr. Psarras timely paid both deposits.

       {¶8}   The purchase agreement contained a waiver of inspection, in which Dr.

Psarras waived his rights to general home, septic, water potability, well flow rate, radon,

and mold inspections. The agreement also contained an “as is” clause, which stated as

follows:

       {¶9}   “BUYER has examined the property and agrees that the property is being

purchased in its “AS IS” PRESENT PHYSICAL CONDITION including any defects

disclosed by the SELLER on the State of Ohio residential Property Disclosure Form,

identified by any inspections requested by either party or on any other forms or addenda

made a part of this Agreement or identified by any other source. SELLER warrants to

BUYER that SELLER has completed the State of Ohio residential Property Disclosure

Form accurately and thoroughly and that no additional items of disclosure have occurred

since the SELLER’S completion of that form. SELLER agrees to notify BUYER in writing

of any additional disclosure items that arise between the date of acceptance and

December 15, 2009. BUYER has not relied upon any representations, warranties or

statements about the property (including but not limited to its condition or use) unless

otherwise disclosed on this AGREEMENT or on the Residential Agreement Disclosure

Form.” Dr. Psarras initialed that he received a residential disclosure form and that he did

not rely on any verbal representations made by brokers or their agents.

       {¶10} Under “additional terms” in the purchase agreement, it is handwritten that

“[i]f tenant defaults under this agreement, the lease, or the lease addendum, all amounts

                                            4
paid by tenant to landlord shall become nonrefundable and shall be the sole property of

seller.”

       {¶11} The Psarras family started to remodel the interior of the home, which

included new kitchen cabinets and installing carpet in the basement and furnishing a

portion of it as a recreation room.

       {¶12} The basement flooded on Memorial Day of 2010 and on approximately July

4, 2010. Dr. Psarras testified that both floodings were significant, resulting in several

inches of standing water.

       {¶13} Dr. Psarras was alerted to the flood on Memorial Day when the sump pump

alarm went off.   After the Memorial Day flood, the carpet was irreparable, and both the

carpet and furniture were removed. They discontinued using the basement and called a

clean-up crew and their real estate agent, Patty Munro.

       {¶14} Approximately one week after the first flooding, Dr. Psarras called Ms.

Rayburn. He informed her of the flooding and that he had spoken with the city building

inspector. Apparently, the flooding issue was an ongoing problem that had involved the

building inspector and the mayor of Pepper Pike, because the adjacent neighbor had

previously not allowed piping to go through his property to fix the problem. Ms. Rayburn

offered to pay for the carpeting. While she sympathized with the problem, she did not

offer to go to the city and/or neighbor meetings called to address the flooding problem

that were to follow.

       {¶15} One month later, around July 4, 2010, Dr. Psarras learned from his daughter

and son-in-law that the basement had flooded again with several inches of water.

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      {¶16} On August 9, 2010, Dr. Psarras sent Ms. Rayburn a letter to notify her that

they “will exercise the option in the agreement to delay closing. We plan to move the date

to a finalized October 15, 2010.”      He went on to write that he appreciated “her

responsibility” with the water problem; they love the house, look forward to “many years

there,” and this “problem has been frustrating.”

      {¶17} Per the lease agreement, at the expiration of the term, a new holdover

tenancy from month-to-month was created with an increase in monthly rent of $5,000.

      {¶18} The following day Dr. Psarras received a letter from Ms. Rayburn’s attorney,

William P. Gibbons (“Mr. Gibbons”) in which Mr. Gibbons informed Dr. Psarras there was

no “option to continue rent,” and that the residential property disclosure form Dr. Psarras

signed plainly disclosed that the basement flooded and that a new pump was installed to

correct the situation. The letter further informed Dr. Psarras that he had agreed to accept

the property “as is present physical condition.” Finally, Mr. Gibbons warned that if Dr.

Psarras failed to close the transaction on August 15, 2010, he would be in breach of the

agreement, Ms. Rayburn would seek specific performance as well as damages, and that

he would “no longer be entitled to occupy the premises.” The letter then listed several

conditions under which Ms. Rayburn would consider extending the lease and closing date

until October 15, 2010. This included paying $25,000 by August 13, 2010, a non-

refundable amount, of which only half would be credited towards the purchase price.

      {¶19} Dr. Psarras emailed his counsel, John P. Blakely (“Mr. Blakely”), regarding

the August 10, 2010 letter the following day. Dr. Psarras wanted to share the details of

the flooding and expressed that neither he, his wife, or the realtor were previously aware

of any flooding problem. He then listed step-by-step the details of the flooding problem

                                            6
and what he was doing to resolve it, including the issues with the neighbor and city hall,

and explained that Ms. Rayburn promised to pay for the carpeting and the additional cost.

      {¶20} On August 17, 2010, Dr. Psarras received another letter from Mr. Gibbons

informing him that he was in default of the lease and purchase agreement as of August

15, 2010 because he failed to comply with the closing requirement and that the lease

agreement had expired. As for the lease, Dr. Psarras was to vacate the premises

immediately, and his August rent payment of $2,500 was not negotiated. Per the terms

of the lease, as a holdover tenant, rent was now increased to $5,000 a month with a daily

charge of $166.67 for every day he remained on the property past August 15.

      {¶21} On August 19, 2010, Mr. Gibbons faxed Dr. Psarras’ counsel and informed

him that he changed the locks on the property. He stated: “[t]he Psarras’s abandoned

the property some time ago and no one has been living there at least since summer began

and the lease has expired since August 15, 2010.” Ms. Rayburn had someone investigate

the property and claimed it was abandoned.

      {¶22} When Dr. Psarras arrived home from work, he found the locks changed on

the house and immediately called the Pepper Pike police department and Mr. Blakely.

Mr. Gibbons met Dr. Psarras, his wife, daughter, and son-in-law on the front lawn of the

property. Mr. Gibbons asked Dr. Psarras if he was going to be able to obtain a loan for

the property. When Dr. Psarras responded affirmatively, Mr. Gibbons gave the Psarras

family the new keys to the home.

      {¶23} On September 3, 2010, Ms. Rayburn posted a “Notice to Leave Premises”

indicating that the Psarras family must vacate the property on or before Wednesday,

September 8, 2010. A forcible entry and detainer action was filed. Ms. Rayburn and Dr.

                                            7
Psarras settled the eviction action in the Shaker Heights Municipal Court and agreed Dr.

Psarras would vacate the property by October 23, 2010.

      {¶24} The Psarras family did vacate the premises by October 23, 2010. Ms.

Rayburn eventually sold the property for $365,000.

                                The Court Proceedings

      {¶25} Dr. Psarras and his wife filed a complaint in the Geauga County Court of

Common Pleas on October 15, 2013, asking the court to declare Ms. Rayburn’s retention

of their $51,000 security deposit as unconscionable and enter judgment against Ms.

Rayburn for $91,000 (the cost of the security deposit and kitchen cabinets the Psarras

had purchased).

      {¶26} Ms. Rayburn filed a motion to dismiss or, in the alternative, for summary

judgment. The court overruled Ms. Rayburn’s motion because she did not supply an

appropriate affidavit from anyone in the position to speak to the accuracy and authenticity

of the documents she submitted to the court to consider. She was ordered to file an

answer within 14 days of the January 27, 2014 judgment entry.

      {¶27} In addition to her answer, Ms. Rayburn filed a counterclaim seeking

damages for breach of contract for the sale of real property, fraudulent representation,

and past due rent.

      {¶28} The case proceeded through a dilatory discovery process, with Dr. Psarras

filing for numerous extensions. Ms. Rayburn filed a motion to disqualify Dr. Psarras’

counsel citing a conflict inasmuch as Mr. Blakely had advised them in this transaction and

thus may be a necessary witness. Ms. Rayburn also filed a motion to compel discovery

and for sanctions.

                                            8
        {¶29}   At the start of trial, the trial court determined Mr. Blakely was not a

necessary witness and because this was a bench trial, the court overruled the

disqualification motion.

        {¶30} The court found Ms. Rayburn’s motion to compel discovery well taken, and

ordered Dr. Psarras to comply with Ms. Rayburn’s request for production of documents

and interrogatories. The court also deferred the matter of sanctions until trial.

        {¶31} Both parties filed for summary judgment. The court granted Ms. Rayburn’s

motion for summary judgment on Dr. Psarras’ claims for remodeling expenses,

specifically the loss of the $40,000 deposit for new cabinets; and Dr. Psarras’ motion for

summary judgment as to Ms. Rayburn’s violations of R.C. 5321 and the lease for failing

to: (1) make repairs; (2) pay interest on the security deposit; and (3) refrain from self-help

eviction. The question of damages for Ms. Rayburn’s violations as well as Ms. Rayburn’s

counterclaims of breach of contract, fraud, and rent owed remained for trial.

        {¶32} On July 27, 2016, a suggestion of death was filed for Dr. Elaine Campbell

Psarras, but there was no substitution of parties sought by Dr. Psarras or by Ms. Rayburn.

Consequently, any claims on behalf of or against Dr. Elaine Psarras were dismissed prior

to trial.

        {¶33} The case proceeded to a one-day trial before the court on October 19, 2016.

Dr. Psarras testified as to the circumstances surrounding the lease/purchase and

purchase agreements. He testified that he understood he was purchasing the property

“as is” but believed the water flooding to be an issue that went to the heart of the parties’

bargain. He claimed he fulfilled all of the conditions of the lease.

                                              9
       {¶34} Mr. Gibbons, Ms. Rayburn’s counsel during the transaction, testified as to

the eviction events and the various letters described above. He believed Dr. Psarras

forfeited the $51,000 for failure to make a lease payment, but upon further questioning,

testified Dr. Psarras fulfilled all the conditions of the lease but failed to comply with the

purchase agreement. He explained the eviction action was based solely on Dr. Psarras

occupying the premises without a lease agreement.

       {¶35} Ms. Rayburn testified she never lived at the address but was named the

trustee in a Limited Trust Agreement of October 3, 2008 in order to sell her parents’ home.

She recalled the conversation with Dr. Psarras about the flooding and telling him she

would pay for the carpet via a deduction from the purchase price. She also testified she

was only aware of the flooding issues that were disclosed on the residential disclosure

form in July 2008, and that she was unaware of any unresolved flooding issue until Dr.

Psarras’ call after the flood on Memorial Day, 2010. Dr. Psarras and his family moved

out, and she eventually sold the property on July 29, 2011.

       {¶36} After trial, the court issued its judgment entry, finding: (1) Ms. Rayburn

owed Dr. Psarras $2,125 as interest on the security deposit; (2) insufficient evidence was

presented to enable the court to determine damages, if any, suffered by Dr. Psarras as a

result of Ms. Rayburn’s failure to repair the leased premises; (3) Ms. Rayburn’s actions

with regard to the security deposit and lease were not unconscionable; (4) Dr. Psarras

breached the agreement to purchase the subject real property for $459,000; (5) as a

result of the breach, Ms. Rayburn suffered $94,000 in damages, the difference between

the contracted price and eventual sales price; (6) Ms. Rayburn incurred $540 in attorney

fees as a result of Dr. Psarras failure to comply with discovery orders; and lastly, (7) Ms.

                                             10
Rayburn failed to prove Dr. Psarras made fraudulent representations. Judgment was

entered in favor of Ms. Rayburn for $41,415 plus interest from the date of August 15,

2010.

        {¶37} Dr. Psarras timely appealed, raising the following assignment of error:

        {¶38} “The trial court erred as a matter of law and abused its discretion in finding

Appellant breached the purchase agreement by not purchasing the property when it found

Appellee breached the lease by failing to make repairs, and awarded interest for the

security deposit.”

                                    Standard of Review

        {¶39} “When confronted with an issue about contract interpretation, the role of the

trial court is to give effect to the intent of the parties to the agreement.” (Citation omitted.)

Kaufman v. Byers, 11th Dist. Geauga No. 2003-G-2525, 2004-Ohio-6346, ¶20.

        {¶40} We review a trial court’s application of law to a breach of a contract de novo.

Id. at ¶21, citing Nationwide Mut. Fire Ins. Co. v. Guman Bros. Farm, 73 Ohio St. 3d 107,

108 (1995); Ohio Historical Soc. v. Gen Maintenance & Eng. Co., 65 Ohio App. 3d 139,

146 (10th Dist.1989).

        {¶41} In his sole assignment of error, Dr. Psarras contends (1) Ms. Rayburn failed

to perform under the contract because she did not return the security deposit, (2) he was

excused from performing under the contract due to the unresolved flooding issues, (3) he

is not the cause of any damages sustained by Ms. Rayburn, and in the alternative, (4) the

lease and purchase agreement should be rescinded due to mutual mistake.

                           Landlord’s Failure to Make Repairs

                                               11
        {¶42} Dr. Psarras argues, without citing to any legal authority apart from R.C.

5321.16, that when the trial court awarded interest on the security deposit, it established

Ms. Rayburn was not entitled to retain the $51,000 deposit. Further, he asserts that

because both agreements had integration clauses, they were “effectively one

transaction.” Thus, if Ms. Rayburn was found to have failed to perform in any manner, he

argues this constitutes a breach that would preclude her from retaining the $51,000.

        {¶43} Firstly, Dr. Psarras misapprehends the import of integration clauses, which

are designed to trigger the parol evidence rule. “An integration need not be reflected in

only one document; the parties’ complete agreement can consist of or be reflected in

multiple documents.” In general, 11 Williston on Contracts, Section 33:14 (4th ed. 2019)

        {¶44} Secondly, the plain language of R.C. 5321.16(A) mandates the payment of

interest on a security deposit even if the entire deposit is returned at the end of the

tenancy.

        {¶45} Finally, the trial court in fact found Ms. Rayburn’s actions “in regards to the

security deposit and lease were not unconscionable,” and therefore did not find Dr.

Psarras was entitled to the return of any or all of the deposit.

        {¶46} It may be arguable whether Dr. Psarras is indeed entitled to interest

pursuant to R.C. 5321.16(A)1 because the only lease provision regarding a deposit of any

kind was under the term “Rent,” requiring the first and last month’s rent installment upon

execution of the lease. The only reference to the $51,000 amount was in the separate

purchase agreement, which required that the initial installment toward the $51,000 in

1. R.C. 5321.16(A) requires a landlord holding a security deposit in an amount exceeding $50 or one
month’s rent, whichever is greater, to pay 5 percent interest on the excess per annum if the tenant remains
in possession for six months or more.

                                                   12
“Earnest Money” be deposited upon execution of the purchase agreement. The $51,000

was to be credited against the purchase price.

       {¶47} But this issue was not raised below or in this appeal, and the trial court

considered the earnest money to be a deposit requiring the payment of statutory interest

under landlord-tenant law apparently because it was being held during the period of time

Dr. Psarras was a “tenant.” In any event, as noted previously, it does not follow, as Dr.

Psarras argues, that when the trial court awarded statutory interest that award was made

because Ms. Rayburn failed to perform under the purchase agreement.

       {¶48}   In regard to the unresolved flooding issues, the evidence established Ms.

Rayburn was unaware that the earlier flooding issues disclosed to Dr. Psarras had not

been resolved by the installation of new pumps, piping, and plates until after the Memorial

Day flood, which damaged the carpeting. He failed to present any evidence of any other

damages he suffered as a result of the July flooding. Further, he submitted no evidence

that the water flooding rendered the house uninhabitable or that it materially affected his

health and safety. Therefore, he did not have a right to terminate his lease under R.C.

5321.07(B) for his landlord’s failure to repair as he now claims.

       {¶49} “It is not a landlord’s failure to fix any problem or to remedy any condition

‘within a reasonable time * * * or within thirty days, which is sooner’ that gives a tenant a

right to terminate his lease under R.C. 5321.07(B). The tenant must establish that the

landlord failed to fulfill an obligation imposed by R.C. 5321.04 or the rental agreement,

that the conditions of the residential premises were such that the tenant reasonably

believed that the landlord had failed to fulfill such an obligation or that a governmental

agency found that the premises were not in compliance with building, housing, health or

                                             13
safety codes that could materially affect the health and safety of an occupant.”     Pedra

Properties, L.L.C. v. Justmann, 8th Cuyahoga Dist. 102909, 2015-Ohio-5427, ¶19, citing

R.C. 5321.07; see also Wenzke v. Baird, 6th Dist. Lucas No. L-13-1244, 2014-Ohio-3069,

¶13 (“[T]he remedies available under R.C. 5321.07(B) require a tenant to show that the

landlord violated (1) the lease agreement, (2) a building code that could materially affect

health or safety, or (3) R.C. 5321.04”).

       {¶50} “[A] tenant must show that a condition exists that renders the premises unfit

or uninhabitable in order to terminate a lease based on R.C. 5321.04(A)(2).” Id. at ¶ 20.

The evidence before the trial court failed to establish that the water intrusion during more

severe storms rendered the entire premises unfit or uninhabitable.

       {¶51} Dr. Psarras failed to meet the statutory requirements of R.C. 5321.07 for

terminating a lease at the time the flooding occurred and cannot raise this as an issue for

the first time on appeal.

       {¶52} Moreover, as explained above, the integration clauses do not support Dr.

Psarras’ argument that Ms. Rayburn “lost her right to enforce the purchase agreement”

by her failure to make repairs.

                  Caveat Emptor and Fraudulent Misrepresentation

       {¶53} Dr. Psarras’ assignment of error also fails due to the doctrine of caveat

emptor and the “as is” clause in his purchase agreement. Although this case at first blush

seems quite complex due to the two separate agreements, it is at heart a simple

residential real estate purchase agreement preceded by a lease term.

       {¶54} As we noted in Thaler v. Zovko, 11th Dist. Lake No. 2008-L-091, 2008-Ohio-

6881, “[t]he doctrine of caveat emptor is designed to finalize real estate transactions by

                                            14
preventing disappointed real estate buyers from litigating every imperfection existing in

residential property.” (Citations omitted.) Id. at ¶31. “The doctrine of caveat emptor

precludes recovery in an action by the purchaser * * * where (1) the condition complained

of is open to observation or discoverable upon reasonable inspection, (2) the purchaser

had the opportunity to examine the premises, and (3) there is no fraud on the part of the

vendor.“ (Citations omitted.) Id.

       {¶55} In this case, there is no question from the testimony and evidentiary

materials in the record that Dr. Psarras was aware of potential flooding problems. The

basement had two sump pumps and the residential disclosure form disclosed the past

flooding problems and what was done to resolve them. Dr. Psarras chose to forgo any

type of inspection prior to signing the lease and purchase agreements. He consulted with

his attorney in regard to the transaction and apparently chose not to have his counsel

review the documents.

       {¶56} “[W]hen a buyer agrees to accept property ‘as is,’ the seller is relieved of

any duty to disclose latent defects.” (Citations omitted.) Id. at ¶37.

       {¶57} “That being said, an ‘as is’ contract relieves a seller only of the duty of

disclosing latent defects, it does not ‘bar a buyer from asserting claims of fraudulent

misrepresentation or fraudulent concealment. * * * ’” (Citations omitted.) Id. at ¶38.

       {¶58} As for Dr. Psarras’ allegation of fraudulent misrepresentation, the record is

devoid of any evidence of fraud on the part of Ms. Rayburn. Rather, had Dr. Psarras

chosen to have an inspection of the water flooding prior to signing the lease and purchase

agreement, he would have learned (as he did after the flooding occurred), that the flooding

problem on the property was actually a known issue in the city of Pepper Pike. The city

                                            15
had tried to resolve the issue with the neighboring property in the past. Further, the fact

that there were two sump pumps in the basement is open and obvious and begs for a

prospective buyer to do a more thorough investigation before signing any agreement to

purchase.

       {¶59} Dr. Psarras has failed to meet the elements which constitute the basis for a

claim of fraudulent misrepresentation, which are: “‘(1) a representation, or where there is

a duty to disclose, concealment of a fact, (2) which is material to the transaction at hand,

(3) made falsely, with knowledge of its falsity, or with such utter disregard and

recklessness as to whether it is true or false that knowledge may be inferred, (4) with the

intent of misleading another into relying on it, (5) justifiable reliance upon the

representation or concealment, and (6) a resulting injury proximately caused by the

reliance.’” Goddard v. Stabile, 185 Ohio App. 3d 485, 2009-Ohio-6375, ¶30 (11th Dist.),

quoting Kimball v. Duy, 11th Dist. Lake No. 2002-L-046, 2002-Ohio-7279, ¶23, quoting

Cardi v. Gump, 121 Ohio App. 3d 16, 22 (8th Dist.1997).

       {¶60} There is no evidence Ms. Rayburn actively concealed or even was aware

of the flooding problems beyond what was disclosed in the residential real estate

disclosure form. Ms. Rayburn testified that she believed that once Dr. Psarras signed the

purchase agreement, he was agreeing to purchase the property “as is.” She offered to

pay for the carpet he installed in the basement that was ruined from the first flood and

testified she would have deducted the cost from the purchase price.

       {¶61} A “buyer cannot be said to have justifiably relied upon misrepresentations

made by the seller where the agreement is clearly contingent upon the inspection rather

any alleged misrepresentations.” Bencivenni v. Dietz, 11th Dist. Lake No. 2012-L-127,

                                            16
2013-Ohio-4549, ¶47, quoting Kimball at ¶24. Dr. Psarras was able to inspect the home

but chose to waive the condition of an inspection and signed the purchase agreements.

                    Damages for a Breach of Real Estate Contract

       {¶62} Without citing to any legal authority, Dr. Psarras contends he is not

responsible for Ms. Rayburn’s damages that resulted from the breach because it was her

failure to correct the flooding issues that caused her damages. As already noted, this

contention is wholly without merit, as Dr. Psarras contracted with Ms. Rayburn to

purchase the property for $510,000 after waiving any inspection of the property and

signing both the lease and purchase agreements, one of which contained an “as is”

clause. He cannot now claim “buyer’s remorse,” unilaterally fail to perform under the

contract, and be free from any corresponding damage.

              The Alternative Remedy of Rescission for Mutual Mistake

       {¶63} Lastly, Dr. Psarras argues the lease and purchase agreement should be

rescinded due to mutual mistake because both parties knew or believed the flooding

issues in the past had not been resolved by the prior repairs performed. The residential

real estate disclosure form disclosed that the basement flooded after rain, and that it was

repaired with new pumps in place as well as new outdoor and indoor piping and grates

placed in the front yard.

       {¶64} While in some cases, mutual mistake may be a ground for rescission of a

contract, this is not the case here, where a residential property disclosure form was

received. Where residential disclosure forms are received, “rescission is not an available

remedy.” Goddard, supra, at ¶43, quoting Chamar v. Schivitz, 11th Dist. Lake No. 2002-

L-181, 2004-Ohio-1957, ¶18-20, quoting R.C. 5302.30(K)(3)(d) and Wilson v. Safarek,

                                            17
131 Ohio App. 3d 622, 625 (7th Dist.1999) (“[I]f a buyer receives the disclosure form

before executing the transfer agreement, then the buyer is aware of the various

disclosures required by statute before he decides to make the purchase”).

       {¶65} It bears repeating that the “doctrine of caveat emptor is designed to finalize

real estate transactions by preventing disappointed real estate buyers from litigating every

imperfection existing in residential property,” especially where, as is the case here, there

is no fraud and the buyers were well aware of the defect, yet chose not to inspect the

property further, and when an issue then arose, breached the contract and “reneged” on

the deal. Thaler at ¶48. A buyer can never be too “aware.”

       {¶66} Dr. Psarras’ sole assignment of error is without merit.

       {¶67} The judgment of the Geauga County Court of Common Pleas is affirmed.

CYNTHIA WESTCOTT RICE, J.,

TIMOTHY P. CANNON, J.,

concur.

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