Opinion
E049900
08-02-2011
PATRICE LANHAM, as Executor, etc. et al., Plaintiffs and Appellants, v. JANE SINER-GADDY et al., Defendants and Respondents.
George S. Wass for Plaintiffs and Appellants. Spile, Siegal, Leff & Goor and Jeffrey E. Lerman for Defendants and Respondents.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Super.Ct.No. INC037864)
OPINION
APPEAL from the Superior Court of Riverside County. Harold W. Hopp, Judge. Affirmed.
George S. Wass for Plaintiffs and Appellants.
Spile, Siegal, Leff & Goor and Jeffrey E. Lerman for Defendants and Respondents.
I. INTRODUCTION
Plaintiffs and appellants Patrice Lanham, as Executor of the Estate of John Lanham, deceased, and Anne Lanham (collectively referred to as plaintiffs) filed an action against defendants and respondents Williams & Gaddy Properties, Inc., Jane Siner-Gaddy (Siner), Bobbie R. Williams (Williams), Brian Gaddy, Bobbie R. Williams and Brian Edward Gaddy, a general partnership doing business as Williams/Gaddy Properties, Heritage Palms Real Estate, Heritage Palms Resales, and Sun City Resales (collectively referred to as defendants) for alleged negligence, misrepresentation, concealment and elder abuse in John and Patrice Lanham's (the Lanhams) purchase of real property located at 40560 Golden Way in Palm Desert (the Property). Following a jury trial, judgment was entered in favor of defendants. Plaintiffs moved for a new trial on the grounds that (1) the evidence supported a finding of breach of fiduciary duty; (2) the verdict of no liability is inconsistent with the factual finding of negligence; (3) there was jury misconduct; and (4) the trial court erred in admitting expert testimony. The motion was denied, and plaintiffs appeal.
On appeal, plaintiffs contend (1) the evidence supports a finding that defendants breached their duties as real estate brokers/agents; (2) the evidence supports a finding of elder abuse; and (3) the trial court erred in allowing expert testimony. Rejecting these contentions, we affirm.
II. PROCEDURAL BACKGROUND AND FACTS
In 1999 the Lanhams moved to Sun City, purchasing property through Siner. Three years later, when they were in their mid-70s, they contacted Siner, a real estate broker who was working for Williams/Gaddy Properties, for the purpose of finding a second residence. According to the Lanhams, they planned to use the second residence as a rental; however, Siner testified that the Lanhams stated they were looking to buy a residence for their adult son. Also, the Lanhams signed a Buyer's Affidavit, which declared, under penalty of perjury, their "plans that [they] or a member of [their] family will reside . . ." in the Property.
The Lanhams specified they wanted the residence to be close to Sun City, in a gated community, with low homeowners dues, and for a price of about $100,000. Siner found the Property that met their criteria; however, it was listed for $159,000. The listing agent was Jim O'Connor. O'Connor created a property detail report, which he placed in the local Multiple Listing Service, describing the Property as a "DOLL HOUSE! . . . A MODULAR IN PERFECT CONDITION!"
Siner accompanied the Lanhams on their initial visit to the Property and on August 15, 2002, assisted them in preparing an offer to purchase. Following a series of counter offers, on August 19 the Lanhams entered into an agreement to purchase the Property for $150,000.
On August 30, 2002, an inspection was performed by Dewey Pest Control. The report showed areas of "water damage/dry rot" at the patio post, in the hot water heater closet flooring, and the furnace flooring. It also showed water damage in the flooring that appeared to be caused by excessive moisture. Some of the items were identified as "Section 2" items which, pursuant to the purchase agreement, meant the buyers, or the Lanhams, were responsible for paying for any recommended work.
On September 3, 2002, a home inspection was performed by A+ Home Inspection Service on behalf of the Lanhams. The home inspection noted the following items: (1) warped fascia on north side of the Property; (2) soil contacting the exterior stucco; (3) "rotted out floor board" beneath the water heater, which also needed to be strapped pursuant to code; (4) "[r]otted out floor beneath FAU"; (5) problems with the HVAC not cooling the Property; (6) "unprotected opening" in the electrical panel; (7) moisture stains on the interior wall where the exterior stucco wall had soil contact; (8) uneven floors at various areas; (9) moisture stains on garage wall and no ventilation in the garage; and (10) toilet in the master bathroom did not flush properly.
Siner testified that she discussed with the Lanhams the findings in the inspection reports. Siner explained the difference between "section 1" and "section 2" items, and Mrs. Lanham "interjected that it was similar . . . to Hawaii," where she had worked as a real estate agent. After an hour and a half, the Lanhams stated they had to leave and instructed Siner to sign their names requesting that the repairs be made. In contrast, Mrs. Lanham testified that Siner never came to their house, never showed them the inspection reports, and never asked them to sign for a request for repairs.
Within a week of opening escrow, Siner received a copy of the preliminary title report. The report stated: "The following exception is to be added to the description contained in . . . the policy: [¶] 'Except therefrom the mobilehome(s) located thereon.'" Siner and Williams contacted escrow to inquire about this language. The title company issued a supplemental report removing the mobilehome language from the policy, replacing it with "single family residence." Siner acknowledged that she did not discuss the language change with the Lanhams because she believed the title company had made an error that it corrected. At trial, counsel for the Lanhams argued the language change was material information that Siner concealed. However, according to the Preliminary Change of Ownership Report, which the Lanhams signed on August 26, 2002, they were aware that a "MANUFACTURED HOME," which was subject to local property tax, was included in the purchase price of the Property.
Escrow closed in September, and the Lanhams' son moved into the Property in October. Shortly thereafter, Mrs. Lanham had him move out because of the condition of the Property. The Lanhams contacted Siner, who worked with them to address their concerns and paid $1,500 on repairs. In August 2003, this action was filed, and a jury verdict was delivered in favor of defendants.
III. BREACH OF FIDUCIARY DUTIES AS REAL ESTATE BROKERS
Plaintiffs argue the jury failed to follow the law, as applied to the facts, and find that defendants were liable for breaching their fiduciary duties. According to plaintiffs, defendants failed to properly investigate the condition of the Property, failed to confirm whether the home was manufactured or modular, failed to ascertain whether the necessary repairs were made prior to close of escrow, and failed to inform plaintiffs of the defects in the Property. In response, defendants point out that the jury was never asked to render a verdict on the issue of breach of fiduciary duty. We agree with defendants.
Plaintiffs expert, Arthur Floyd, testified: "A modular home is one that has a substantial foundation. . . . . . [¶] [T]he home itself could be built quite similar to regular construction, and it is very heavy. It is put on usually a Low Boy or a specialized trailer to be involved in the site and then lifted by a crane on to the premier foundation. [¶] Now, the foundation of a modular home is one of what we call beam and peer [sic]construction. It will have a surround foundation of concrete, very typical to a standard home, and it will have notches in the foundation, carry beams that will travel . . . from one segment of the foundation, let's say, the right side of the property to the left side of the property. And those beams will go across and notch on the concrete. [¶] Then there will be piers periodically every four to six feet across under those beams that are placed there. And those will be the support for the beams. In other words, the beams . . . will not necessarily span the whole width, but they will be carried on these piers. [¶] The piers consist of a concrete block usually with a redwood-type wood on the bottom of the concrete piece, a sloped piece; on top another red[]wood piece and a post. [¶] . . . [¶] . . . [A]nd one of the key elements of it is that there is full access under that structure. So if you need to crawl under there you will have 18 inches of clearance from the soil to the bottom of the deepest beam, and there is 22 inches minimum from the joist."
Mr. Floyd further testified that a mobilehome is "designed to be trucked and trailered. In other words, it carries its own wheels as you hook the trailer segment. It could be a very long segment of 40, 50 feet. Does not make much difference, as long as it has enough wheels to get down the road, and you bring it to a [s]ite. [¶] Now, the way these are constructed is the front and back design of the base of the trailer is one long streamer. I think we saw that on the photographs earlier, one long streamer goes from the head of the trailer, the front of the trailer all the way to the back, and you have one of those on each side of the trailer. [¶] . . . [¶] Now, the key to mobile home construction is that it has to be very light. The idea is to bring the mobile home to one location, and many people put them in one place. . . . . [¶] . . . [¶] . . . Fiber board in mobile homes is used for flooring simply because it is light weight. It is very light weight. On the mobile home, also they will use the half inch fiber board to make the outside walls, and then they cover it with aluminum . . . or . . . vinyl, different things like that. They don't stucco them, because that adds an enormous amount of weight. They don't put tile roofs on, because that would add a tremendous amount of weight."
According to the California Health and Safety Code, after June 15, 1976, mobilehomes are referred to as manufactured homes. (Health & Saf. Code, §§ 18007 and 18008.) The discussion between counsel and the trial court also noted the interchangeable use of mobile and manufactured homes.
Turning to the record before this court, we note that plaintiffs pled this case on negligence/negligent misrepresentation claims. The jury returned a verdict finding that defendants were negligent in their representation of plaintiffs. However, the jury failed to find that defendants' negligence constituted a substantial factor in causing harm to plaintiffs. To the extent that plaintiffs contend the evidence does not support the jury's finding that defendants' negligence did not cause harm to plaintiffs, we reject their contention.
The jury considered all the evidence. On the one hand, the evidence shows that defendants failed to clarify whether the Property was modular or manufactured, defendants failed to ensure that all repairs were made, and defendants failed to inform plaintiffs that the preliminary title report referenced the Property as including a mobilehome. However, on the other hand, the evidence shows that Siner included a "Buyer's Inspection Advisory (C.A.R. Form BIA-11)" attached as a supplement to the initial purchase agreement signed by the plaintiffs.
Pursuant to the Buyer's Inspection Advisory, plaintiffs were advised: "The physical condition of the land and improvements being purchased is not guaranteed by either Seller or Brokers. For this reason, you should conduct thorough inspections of the Property personally and with professionals who should provide written reports of their inspections. A general physical inspection typically does not cover all aspects of the Property nor items affecting the Property that are not physically located on the Property. If the professionals recommend further investigation, tests or inspections, including a recommendation by a pest control operator to inspect inaccessible areas of the Property, you should contact qualified experts to conduct such additional investigations, tests or inspections."
Further, the Buyer's Inspection Advisory informed plaintiffs that "Brokers do not have expertise and therefore cannot advise you on many items, such as . . . structural conditions of the foundation or other improvements, or the condition of the roof, heating, air conditioning, plumbing, electrical, sewer, septic, waste disposal, or other system. The only way to accurately determine the condition of the Property is through an inspection by an appropriate professional selected by you. . . . Brokers have a duty to make a diligent visual inspection of the accessible areas of the Property, and to disclose the results of that inspection. However, as some Property defects or conditions may not be discoverable from a visual inspection, it is possible Brokers are not aware of them. . . . YOU ARE STRONGLY ADVISED TO INVESTIGATE THE CONDITION AND SUITABILITY OF ALL ASPECTS OF THE PROPERTY. IF YOU DO NOT DO SO, YOU ARE ACTING AGAINST THE ADVICE OF BROKERS."
The Real Estate Transfer Disclosure Statement also informed plaintiffs they "should have Property inspected by Certified Inspector." The Preliminary Change of Ownership Report, which the Lanhams signed on August 26, 2002, noted that a "MANUFACTURED HOME" that was subject to local property tax was included in the purchase price of the Property. Given the above written evidence, coupled with the fact that Mr. Lanham was a retired federal judge and Mrs. Lanham had worked as a real estate agent in Hawaii, the evidence supports the jury's finding that defendants' negligence was not a substantial factor in causing harm to plaintiffs.
In their reply brief, plaintiffs emphasize "the issue is disclosure." (Emphasis in original.) However, as noted, the documentation, signed by plaintiffs, acknowledged the fact that a "MANUFACTURED HOME," which was subject to local property tax, was included in the purchase price of the Property.
To the extent that plaintiffs argue the jury's finding regarding negligence is incompatible with the finding that the negligence was not a substantial cause of plaintiffs' harm, their argument is misplaced. A finding that defendant was negligent does not necessitate a finding that the negligence was a substantial factor in causing plaintiff's harm. (Luna v. Vela (2008) 169 Cal.App.4th 102, 114 ["even if negligent, [defendant's] conduct was not a substantial factor in causing [plaintiffs] injury"].)
IV. ELDER ABUSE
Plaintiffs contend that defendants committed elder abuse. As with their argument above, plaintiffs submit that a de novo review should be applied because the facts are undisputed. We disagree. Whether or not defendants committed elder abuse is a disputed question of fact. (In re Providian Credit Card Cases (2002) 96 Cal.App.4th 292, 301 [holding that substantial evidence review should be applied in cases where different inferences can be drawn from undisputed historical facts].) Therefore, we must affirm the judgment so long as it is supported by substantial evidence. (Ibid.)
According to plaintiffs, defendants committed financial abuse of an elder because they assisted in taking real property from an elder with intent to defraud. (Welf. & Inst. Code, § 15610.30, subd. (a).) Plaintiffs' primary basis for this claim is defendants' modification of the preliminary title report, which excepted "the mobilehome(s) located thereon" from the proposed policy of title insurance. After receiving the report, defendants inquired about the title language, resulting in the title company issuing a supplemental report removing the language and identifying the home on the Property as a "single family residence." Plaintiffs argue this amounted to "constructive and actual fraud," because defendants concealed "their own concerns that this was a mobile home . . . ."
Plaintiffs' argument amounts to nothing more than mere speculation. Given the record before this court, it was reasonable for the jury to find that defendants' actions did not demonstrate an intent to defraud plaintiffs. First, defendants presented the expert testimony of Gidon Vardi, a construction consultant, that the Property was in fact a modular home rather than a mobilehome. Second, the jury heard testimony that preliminary title reports often contain errors that must be inquired into and that real estate agents have no duty to consult with the client before making such inquiry. Finally, the jury heard testimony that defendants had a good faith belief the Property was a modular home, which is the reason they inquired into the "mobilehome" language on the preliminary title report. Defendants' belief was vindicated when the title company responded with a supplemental report stating that an investigation of the land was done and the company concluded that a single family residence was situated on the land and not a mobilehome.
V. EXPERT TESTIMONY
Finally, plaintiffs contend that defendants' expert witness, Gidon Vardi, a construction consultant, exceeded the scope of allowable testimony by testifying about whether or not the Property was a modular home. They argue that, because the expert was deposed only concerning the repair and maintenance costs of the Property, he was not at liberty to opine about anything beyond such inquiry. (Code Civ. Proc., § 2034.210 et seq.) Defendants point out plaintiffs failed to offer any evidence that would show how the expert's designation was incompatible with his testimony. Defendants argue that, because plaintiffs do not cite to the record where the expert testified or where the trial court addressed the designation issue, plaintiffs have failed to carry their burden of proof on appeal. While defendants are correct in their observation, we will address the issue on its merits.
"A trial court's decision to admit expert testimony 'will not be disturbed on appeal unless a manifest abuse of discretion is shown.' [Citation.]" (Kotla v. Regents of University of California (2004) 115 Cal.App.4th 283, 291.) Pursuant to Code of Civil Procedure section 2034.300, subdivision (d), a trial court must, upon a proper objection, exclude from evidence the expert opinion of any witness offered by a party who has unreasonably failed to make the expert available for a deposition. While that is not exactly the case here, the statute is applicable in that an expert could "in effect not [be] available for deposition as to the further opinions he offered at trial . . . ." (Jones v. Moore (2000) 80 Cal.App.4th 557, 565.) Nonetheless, the trial court may allow expert testimony about a matter that is within the "general ambit" of that which is in his expert declaration or deposition. (Id. at p. 566.) Moreover, testimony beyond the scope of deposition testimony may also be allowable if the opposing party has an expectation that the expert will testify on the matter. (Easterby v. Clark (2009) 171 Cal.App.4th 772, 780 (Easterby).)Such is the case before this court.
Here, plaintiffs argue that defendants' expert witness was designated to opine only on the physical condition, maintenance and repairs of the Property and should not have been permitted to testify at trial about whether the Property was a manufactured/mobilehome versus a modular home. We disagree. Because a manufactured/mobilehome differs from a modular home in key respects, testimony regarding the condition and maintenance of the Property necessarily required a discussion about whether the Property examined was a manufacture/mobilehome or a modular home. Moreover, plaintiffs should have expected the defendants' expert to discuss the difference between manufactured/mobile and modular homes. (Easterly, supra, 171 Cal.App.4th at p. 780.) The issue was central to plaintiffs' claims of negligence, misrepresentation, and elder abuse. The expert was a construction consultant who held a general contractor's license for over 30 years. He had thoroughly examined the Property twice before trial. When he was questioned about plaintiffs' expert's representations regarding manufactured/mobile and modular homes, plaintiffs' counsel objected. The trial court allowed counsel to argue the issue. Prior to argument, the court noted that during his deposition, the defense expert expressed that he had "other opinions" he intended to discuss at trial; however, plaintiffs' counsel failed to inquire about them. Defense counsel stated that plaintiffs' counsel "would not allow" the defense expert to provide any opinions as to whether the Property was a manufactured/mobile or modular home. Following argument, the trial court decided to allow the defense expert to testify on the difference between manufactured/mobile and modular homes. The trial court did not abuse its discretion in allowing the expert's testimony, because the topic of whether or not the structure was a modular home falls within the "general ambit" of testimony regarding the physical condition and maintenance of the Property.
VI. DISPOSITION
The judgment is affirmed. Parties to bear their own costs on appeal.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
HOLLENHORST
Acting P. J.
We concur:
KING
J.
MILLER
J.