Commentary: No tort claims in home sales.

• Date: 07 July 2008

Byline: David Ziemer

The buyer of a residential home cannot recover from the seller for misrepresentation, even if the seller intentionally failed to disclose that the home's sewer line was broken.

However, the effect will be minimal in most cases, because homebuyers can still pursue contract and statutory remedies.

Writing for the majority, Justice N. Patrick Crooks concluded, Clearly, purchasers have adequate contractual and statutory remedies, if needed.

Nevertheless, it will affect some cases.

Writing in dissent, Justice Ann Walsh Bradley noted that the statutory remedies are governed by a three-year statute of repose, and the contract remedies by a six-year statute of limitations.

Tort claims, on the other hand, are subject to the discovery rule, which tolls running of the statute of limitations until the fraud is revealed.

Bradley wrote, [T]here remain fraud cases where tort is the only remedy. The majority bars those homeowners from recovering for latent defects hidden by sellers' deceit.

Broken Sewer

Shannon Below bought a house from Dion R. and Dana Norton.

The Nortons' property condition report did not disclose that the sewer line that ran between the house and the street was broken.

Below sued, alleging intentional, negligent, and strict liability misrepresentation (tort claims); and misrepresentation in violation of secs. 100.18, 895.446 and 943.20(1)(d) (statutory claims). A contract claim was later added, but the complaint was not properly served.

The Supreme Court held that the tort claims were barred by the economic loss doctrine (ELD), but the sec. 100.18 claim could proceed. The court declined to address whether the 895.446 claim could proceed...