Submitted: October 8, 2014
Upon Plaintiffs' Motion for Costs and Attorney's Fees, GRANTED in part, DENIED in part.
Upon Defendants' Motion for Attorney's Fees, DENIED.
Donald L. Gouge, Esquire, Donald L. Gouge, Jr., LLC, Attorneys for Plaintiffs.
Bayard J. Snyder, Esquire, Snyder & Associates, P.A. Attorneys at Law, Attorney for Defendants.
M. JANE BRADY SUPERIOR COURT JUDGE
The underlying cause of action in this case concerns a sale of real property. Kenneth and Clasina Dreisbach ("Plaintiffs") bought a home (the "Property') from Robert and Martina Walton ("Defendants") in 2008. Shortly after the sale, Plaintiffs discovered that several answers on the Seller's Disclosure were incorrect, and Property required reconstruction. Plaintiff's filed suit alleging breach of contract, fraud and misrepresentation, negligent fraud, and violation of the covenant of good faith and fair dealing. A bench trial was held beginning on April 14, 2014, and the Court found for Plaintiffs in the amount of $1, 375 on the basis of breach of the implied covenant of good faith and fair dealing.
On September 5, 2014, Plaintiffs filed a timely Motion for Costs and Attorney's fees. The Motion is opposed by Defendants, who filed a timely Response on September 12, 2014. Defendants also countermoved for Defendants' attorney's fees. The Court permitted Plaintiffs to file a brief reply to Defendants' Response. Plaintiffs submitted the reply on September 25, 2014. The Court subsequently granted Defendants' request to file an additional brief reply. On October 8, 2014, Defendants submitted the additional reply, and the Court took the matter under consideration. For the reasons set forth below, Plaintiffs' Motion is GRANTED in part and DENIED in part. Defendants' Motion is DENIED.
II. Facts and Procedural Background
Because there are multiple motions for costs, and because the Court found both for and against the Plaintiff as to the many, various claims made, some recitation of the underlying facts ir required.
In 2009, Plaintiffs began house hunting for a new residence. Plaintiffs eventually settled on subject Property, which was owned by Defendants. Before buying the home, Plaintiffs hired a home inspector and learned that the roof needed to be replaced. Plaintiffs negotiated a credit of $8, 500 to replace the roof. However, aside from the roof's needing to be replaced, Plaintiffs did not learn of any other defects prior to the sale.
Defendant Martina Walton ("Mrs. Walton") filled out the Seller's Disclosure form. As later came to light, Mrs. Walton answered several questions on the form incorrectly. First, Mrs. Walton represented that there were no violations of New Castle County code on Property, and that permits for structural changes to the home had been appropriately secured. In fact, as Plaintiffs discovered after the sale was complete, permits for work done in finishing the basement had never been issued, and the basement was not in compliance with NCC code.
Second, Mrs. Walton answered "no" to the question of whether there were any plumbing additions and "na" for whether a licensed contractor was used for these additions. Mrs. Walton also represented that all of the electrical work had been done by a licensed contractor. In fact, Defendants had hired a contractor in 2003 to finish the basement, which included installing a kitchenette and full bathroom, which involved extensive plumbing additions. Defendants' contractor turned out not to be licensed in New Castle County.
Finally, Mrs. Walton answered "no" to the question of whether that had been any past leaks. The questions about roof repairs were left blank. In fact, in 2005, Defendants' son-in-law had discovered some possible mold near the soffit when he was insulating the attic.Because of what their son-in-law found, Defendants hired a roofing company to inspect their roof. The roofing company found signs of water leakage in the attic and chimney. Defendants had the roofing company remove, replace, and repair the damaged area.
Upon discovery of the defects with the home in 2010, Plaintiffs hired a contractor to fix the problems and bring the house up to code. In 2012, Plaintiffs filed the instant suit seeking $20, 956.50 in damages for the construction work that had been performed to fix the problems with the house. Plaintiffs alleged causes of action for breach of contract, fraud and misrepresentation, negligent fraud, and breach of the implied covenant of good faith and fair dealing. Plaintiffs alleged that Mrs. Walton knew or should have known of the inaccuracies in the Seller's Disclosure form, and that Mrs. Walton negligently or intentionally misled Plaintiffs about the condition of Property. Plaintiffs also alleged that Defendants failed to disclose that: (1) that Property had been rented, (2) that Defendants filed an insurance claim on that address in March of 2008, and (3) the issues with the roof.
At the end of trial, Plaintiffs withdrew their claim for damages relating to the roof because an $8, 500 credit for same had been made when the property was purchased. The Court found that Plaintiffs failed to prove, by a preponderance of the evidence, that the 2008 insurance claim was related to subject Property. The Court also found that Plaintiffs failed to prove that Property was rented during Defendants' ownership.
The issues concerning the construction defects in the home itself were more complex. The Court found no breach of contract related to the fact that the basement was finished by an unlicensed contractor and that the contractor failed to secure the proper permits. The Court found that Plaintiffs failed to prove that Defendants knew or should have known about these defects, or that Defendants had acted in bad faith to conceal them.
Concerning the charges of fraud, intentional misrepresentation, and negligent representation, the Court also found for the Defendants on the grounds that Plaintiffs had not demonstrated the necessary element of reliance. The Court did, however, find a violation of the implied covenant of good faith and fair dealing with respect to Mrs. Walton's failure to disclose the plumbing upgrades in the Seller's Disclosure where she was asked to disclose "any additions/upgrades to the original [plumbing] service." The Court found that Mrs. Walton clearly knew about the plumbing upgrades as Defendants had contracted for a new full bathroom and kitchenette to be installed in the basement. Mrs. Walton argued that she did not disclose this work because she considered the ...