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Tuesday, June 25, 2013

Ind. Decisions - Another opinion today from our Supreme Court

In Barbara A. Johnson and William T. Johnson, Both Individually and as Trustees of the Barbara A. Johnson Living Trust Dated 12-17-1996 v. Joseph Wysocki and M. Carmen Wysocki, a 16-page, 4-1 opinion, Justice David writes:

The owners of a home sold it after completing Indiana’s statutory disclosure forms, attesting to the home’s condition. Shortly after moving in, the buyers discovered a number of defects that required considerable expense to remedy. The buyers sued the former owners, alleging fraudulent misrepresentation. The question is whether Indiana’s Disclosure Statutes create such a claim or if the common law still prevails and the principle of caveat emptor effectively ends the buyers’ case. Today we hold that the General Assembly’s adoption of the Disclosure Statutes abrogated our common law jurisprudence for those transactions falling within their scope. * * *

Thus, for those types of residential real estate transactions to which they apply—and for the property features which are addressed within them—we hold that Indiana’s Disclosure Statutes abrogated the common law principles originally set forth in Cagney. In such transactions, the seller may be liable for fraudulent misrepresentations made on the Disclosure Form when he or she had actual knowledge that the representation was false at the time he or she completed the form. But because statutes in derogation of common law are strictly construed, and we presume that the General Assembly is aware of the existing common law and does not intend to change it “beyond what the express terms of its enactments and fair implications allow,” Town of Avon v. W. Cent. Conservancy Dist., 957 N.E.2d 598, 603 (Ind. 2011), we view our common law principles as being undisturbed for transactions falling outside the scope of the Disclosure Statutes. * * *

We decline to assess whether a finding of actual knowledge can be inferred from the facts and surrounding circumstances as reflected in the record before us. We neither weigh evidence nor assess witness credibility. Rose Acre Farms, Inc. v. Greemann Real Estate, 516 N.E.2d 1095, 1097 (Ind. Ct. App. 1987), trans. denied. Therefore in this case the wiser approach would be to allow the trial court to take the guidance set forth in this opinion and make his own determination first with the full benefit of having been able to assess and weigh the credibility of witnesses and evidence presented at trial.

Conclusion. We reverse the trial court and remand for new findings pursuant to this opinion.

Dickson, C.J., Massa and Rush, JJ., concur.
Rucker, J., concurs in part and dissents in part with separate opinion. [which reads in full] I fully concur with Part I of the majority opinion. I also concur with that portion of Part II declaring that the trial court “applied the wrong legal standard to the facts” of this case. Slip op. at 14. However, I disagree with the necessity of remanding this cause to the trial court for new findings. It is certainly true the trial court did not use the magic words “actual knowledge.” But as recounted in the Facts section of the majority opinion, the record before us is more than sufficient to support the conclusion that the Johnsons had such knowledge of the various defects prior to the time they sold the property to the Wysockis. I would therefore affirm the judgment of the trial court in all respects and put this litigation to rest. Therefore, on this point I respectfully dissent.

Posted by Marcia Oddi on June 25, 2013 11:07 AM
Posted to Ind. Sup.Ct. Decisions