Sunday, September 03, 2017

consumer protection - UTPCPL - representation - justifiable reliance

Zajick v. Cutler Group – Superior Court – August 31, 2017

There was “no evidence” that homeowner “justifiably relied on representations” from builder regarding construction on the specific home or alleged defective stucco, “as is required to bring a privarte cause of action under Pennsylvania’s Unfair Trade Practices and Consumer Protection Law (“UTPCPL”), 73 P.S. §201-2, et seq.

Plaintiff homeowner never had any communication with builder about the home.   Homeowner claims were based solely in reliance  on builder’s “reputation and general statements from a sales rep. about homes in the same development.  Builder constructed home in 2003, sold it to initial buyer, who sold it to Plaintiff.

In order to bring a private cause of action under the UTPCPL, “a plaintiff must show that he justifiably relied on the defendant's wrongful conduct or representation and that he suffered harm as a result of that reliance.” Yocca v. Pittsburgh Steelers Sports, Inc., 854 A.2d 425, 438 (Pa. 2004) (emphasis added).   Strict technical privity is not required to bring a cause of action under the UTPCPL, and it was not a factor in this case. Valley Forge Towers Smith Condominium v. Ron-Ike Foam Insulators, Inc., 574 A.2d 641, 647 (Pa. Super. 1990).   Rather, the trial court granted summary judgment after concluding that Appellant “failed to establish any representations made by [builder] that rise to the level of representations upon which reasonable justifiable reliance is foreseeable.”

In Adams v. Hellings Builders, Inc., 146 A.3d 795, 801 (Pa. Super. 2016), the court held that strict technical privity is not required to assert a cause of action under the UTPCPL, rather the “focus is on whether reliance on alleged misrepresentations was specially forseeable.”  In that case, the home did not comply with the stucco standards which were set out in the specific written contract between builder and initial homeowner, who then sold to plaintiffs.  Plaintiff there alleged that the sales agreement between the builder and the initial purchasers represented that the home would include a three-coat stucco system according to International Residential Code Standards.   However, upon inspection by plaintiff’s expert, the stucco system did not comply with those standards.   The plaintiffs alleged that they had justifiably relied on this sales agreement when they decided to purchase the home.   The court determined that those facts were sufficient upport a private cause of action under the UTPCPL, because the complaint alleged that the builder made representations about the home and stucco system in the sales agreement, and it was foreseeable that plaintiffs would justifiably rely on those representations. Adams, supra at 801-802.

In contrast, plaintiff here did not produce any evidence that builder made representations about the specific home at issue or the alleged defective stucco to her or the previous purchasers. In fact, hhomeowner conceded “she never had any communication with builder regarding this home prior to purchasing it from the initial buyer.  Rather,, plaintiff here
relied on (1) the “reputation” of the builder as an “experienced, reliable, reputable builder of custom homes[;]” (2) the experience homeowner nt had in purchasing and inhabiting her previous home, which was built by same builder and did not exhibit latent construction defects; and (3) “the representations of builder’s sales representative as to the construction and quality of the homes in the the same development as the home at issue, when homeowner was in the process of purchasing her previous home directly from Cutler and toured homes there.

The court held that  “there is no legal basis to allow [homeowner’s] claim to move forward based solely on her reliance on builder’s  reputation and general statements from a sales representatives about homes in the same development. Since homeowner failed to establish that builder made any representations about her specific home or the alleged defective stucco, the trial court properly found that she failed as a matter of law to present evidence that she “justifiably relied” on “representations” of builder.


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