On appeal from Superior Court of New Jersey, Law Division, Morris County.
Approved for Publication April 30, 1996.
Before Judges Stern, Wallace and Newman. The opinion of the court was delivered by Newman, J.A.D.
The opinion of the court was delivered by: Newman
The opinion of the court was delivered by
Plaintiffs Oliver Byrne and Gemma Byrne appeal from the grant of summary judgment, dismissing their complaint as to defendants Weichert Realtors (Weichert), Ruth Waddington (Waddington), Kelly Dempsey (Dempsey), and Patrick Geary (Geary), individually and as administrator of the estate of Mary E. Geary. Subsequent to the grant of summary judgment, two defendants, Bernard Sopko and One Source Inspection Inc. d/b/a Ecological Home Inspection, remained. The contract between plaintiffs and the home inspection service required that in the absence of any other parties, their claims must be submitted to binding arbitration. A dismissal without prejudice was filed as to these defendants. With regard to the other defendants, except Kelly Dempsey, we reverse the order granting summary judgment. As for Dempsey, we affirm the order granting summary judgment.
Geary, as administrator of the estate of Mary E. Geary, had put 12 Willard Place, Morristown, in the hands of Waddington as listing agent and Weichert as broker to sell the property. The original asking price was in the range of $160,000 to $169,000. The price was reduced first to $139,900 and then $129,000 as it lingered on the market. An offer was made by Robert B. Webster, Jr. in May 1992. Madge Cahill of Weichert was the real estate associate handling this first proposed sale. A termite inspection for Webster was conducted by Joseph M. Nitzsche of Foresight Engineering on June 4, 1992. Nitzsche found visible evidence of infestation of termites and carpenter ants located in the interior trim in the garage and in the siding of the house. He recommended that a pest control firm be consulted for treatment. Foresight Engineering, through Nitzsche, declined, based on the above information, to provide a warranty for this residence. An inspection was then made by Terminex on June 6, 1995 and quotes were given for a residential pest control service agreement and a termite protection plan. On June 6, 1992, Webster, through his attorney, rescinded his offer to purchase the property, requesting the return of his deposit monies.
In notes dated June 8, 1992, Waddington, as a result of a phone conversation with a representative of Jackson Exterminating Inc., wrote that
Plates totally eaten away. To treat requires drilling thru the floor. Afraid of hitting water pipes. Termites may have gone up to 2nd floor.
Waddington indicated in her deposition that she was referring to the wooden "plates" on the foundation that hold up the walls.
Meanwhile, Dempsey, also a Weichert agent and a social friend of plaintiffs, showed the house to plaintiffs. Dempsey advised plaintiffs after they offered $129,000 that an offer had been made for $130,000. Plaintiffs then offered $131,000. They signed a contract on June 18, 1992. Geary agreed to the offer on June 19, but struck the form clauses that permitted plaintiffs to obtain wood-destroying insect, home, well and septic inspections, enumerated as paragraphs 4, 5, 7 and 8 respectively in the sales contract. Geary replaced the stricken clauses with the following hand-printed acknowledgement:
SELLER REPRESENTS THERE ARE CARPENTER ANTS AND TERMITES ON THE PROPERTY AND SELLER ASSUMES RESPONSIBILITY TO TERMINATE THEM AND PROVIDE BUYERS WITH A ONE YEAR WARRENTY (sic) OF THE WORK.
The parties acknowledge that when Waddington returned to Dempsey and plaintiffs with the contract signed by Geary, Waddington mentioned a termite and carpenter ant problem. Gemma Byrne testified in depositions that Waddington said the problem was "very minimal" and "fixable". Dempsey and Waddington testified that Waddington did not characterize the amount of damage.
Upon review of the contract, plaintiffs' attorney objected to the deletion of the inspection clause and demanded its reinstatement in a June 22 letter. It was then included. The property was thereafter inspected by Sopko of Ecological on June 23, 1992. Sopko noted visible evidence of termites in both the garage and house. The inspection was expressly limited to visible areas only and was not an ...