Tuesday, December 27, 2011

Court reviews a case involving the alleged fraudulent concealment of flooding in a house that was sold by defendants

G. KENNETH CAMPBELL ET AL. v. JAMES E. HUDDLESTON ET AL. (Tenn. Ct. App. December 27, 2011)

James E. Huddleston and his wife, Patricia M. Huddleston ("the Sellers"), sold their house to G. Kenneth Campbell and his wife, Teresa J. Campbell ("the Buyers"). The Buyers inquired of the Sellers as to whether there had been flooding in the house. The Sellers disclosed that there had been one flood in the basement to a depth of six inches.

During the course of some later renovations, the Buyers became aware the Sellers had indicated, on a wall stud, that there had been a 1998 flood in the basement to a depth of 38 inches. They also learned the Sellers had made an insurance claim for another flood in 2003 that was nearly one-foot deep.

The Buyers filed this tort action sounding in fraudulent concealment and fraudulent misrepresentation. The Sellers filed a motion for summary judgment asserting that, since the Buyers were made aware of the one "six inch" flood, they could not have relied on the misrepresentations with respect to the full extent of the two flooding events. The trial court granted the motion and dismissed the case. The Buyers appeal. We vacate the order granting summary judgment and remand for further proceedings before a different trial judge.

Opinion available at: