Page et al v. Dunn et al

Filing 43

ORDER AND REASONS denying 25 Motion for Summary Judgment. Signed by Judge Susie Morgan on 11/21/2017. (clc)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
BRANDON PAGE, ET AL
Plaintiffs

CIVIL ACTION

VERSUS

NO. 16-3621

CRYSTAL ALLEY DUNN, ET AL
Defendants

SECTION: “E”(2)

ORDER AND REASONS
Before the Court is a motion for summary judgment filed by Defendants Crystal
Alley Dunn and Bradley T. Dunn. 1 The motion is opposed. 2 For the reasons that follow,
the motion is DENIED.
BACKGROUND
On May 26, 2016, Plaintiffs Brandon and Stephanie Page bought a home in
Metairie, Louisiana “AS IS” from Defendants Crystal and Bradley Dunn. 3 After moving
into their new home, Plaintiffs “discovered extensive, undisclosed, hidden, and
intentionally concealed, redhibitory defects within the property.” 4
Plaintiffs allege that Mr. Dunn, “a contractor by trade,” made “substantial
improvements and repairs” on the property before selling it to Plaintiffs,5 but that Mr.
Dunn failed to report any of those repairs or the defects the repairs were meant to remedy
in the home’s Louisiana Residential Property Disclosures form. 6 “On or about May 3,
2016,” before the sale of the home closed, “Michael J. Turner Home Inspections reviewed

R. Doc. 25.
R. Doc. 29.
3 R. Doc. 22 at ¶ VI, VIII; R. Doc. 29-2 at ¶ 13.
4 Id. at ¶ XII.
5 Id. at ¶ IV.
6 Id. at ¶ XIII. Louisiana Revised Statutes 9:3198(A)(1) states “The seller of residential real property shall
complete a property disclosure document in a form prescribed by the Louisiana Real Estate Commission or
a form that contains at least the minimum language prescribed by the commission.”
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the Louisiana Residential Property Disclosure[], noted that no prior repairs or water
intrusion had been disclosed[,] and conducted an [sic] visual inspection [of the property]
pursuant to La. R.S. 37:1471.” 7 Because Mr. Turner conducted only a visual inspection,
“[h]idden or concealed defects were not included in the report.” 8 Two months after the
sale became final, having concerns with the home, Plaintiffs contacted Mr. Turner to
conduct a follow up inspection, which took place on July 12, 2016. 9 During this more indepth inspection, Mr. Turner concluded extensive water damage existed in the home. 10
According to Plaintiffs:
Bradley T. Dunn . . . intentionally and fraudulently concealed, through
negative response on the Louisiana Residential Property Disclosures, that
the property suffers from drainage problems. Specifically, the back carport
holds standing water. Portions of the slab have been sloped in an effort to
correct this problem but is ineffective. There are chronic moisture problems
on the interior walls of the shed and there is always standing water in the
shed requiring much of the framing to be re-built once the foundation is
leveled and drainage problems eliminated. 11
Bradley T. Dunn further intentionally and fraudulently concealed defects in
the property by marking “N” on the Louisiana Residential Property
Disclosures regarding the identity of any defects in the ceiling, interior
walls, floor, decks, and exterior walls. 12
Plaintiffs also allege the house contained toxic levels of mold and trapped moisture at the
time of sale, which has resulted in “[h]igh levels of actively growing Stachybotrys.” 13
Finally, Plaintiffs allege Defendants “misrepresented . . . that the property had never had
termites or other wood-destroying insects” despite Mr. Dunns’ having contacted

R. Doc. 29-2 at ¶ VII.
Id. at ¶ VII.
9 R. Doc. 29-6 at 15.
10 Id.
11 R. Doc. 29-2 at ¶ XIII.
12 Id. at ¶ XIV.
13 Id. at ¶ XV (P).
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Envirotec Pest Control Services, LLC in 2016 “regarding termites within the [outside]
shed.” 14
Based on these alleged redhibitory defects, Plaintiffs filed suit against Defendants
on November 18, 2016 in the 24th Judicial District Court for the Parish of Jefferson, State
of Louisiana, seeking to rescind the sale. 15 On December 13, 2016, Defendants removed
the case pursuant to this Court’s diversity subject matter jurisdiction. 16 Defendants now
move for summary judgment. 17
LEGAL STANDARD
Summary judgment is proper only “if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.” 18
“An issue is material if its resolution could affect the outcome of the action.” 19 When
assessing whether a material factual dispute exists, the Court considers “all of the
evidence in the record but refrain[s] from making credibility determinations or weighing
the evidence.” 20 All reasonable inferences are drawn in favor of the non-moving party. 21
There is no genuine issue of material fact if, even viewing the evidence in the light most
favorable to the non-moving party, no reasonable trier of fact could find for the nonmoving party, thus entitling the moving party to judgment as a matter of law. 22
“[A] party seeking summary judgment always bears the initial responsibility of
informing the district court of the basis for its motion[] and identifying those portions of

Id. at ¶ XV (V).
R. Doc. 1-2.
16 R. Doc. 1.
17 R. Doc. 25.
18 FED. R. CIV. P. 56; see also Celotex, 477 U.S. at 322–23.
19 DIRECTV, Inc. v. Robson, 420 F.3d 532, 536 (5th Cir. 2005).
20 Delta & Pine Land Co. v. Nationwide Agribusiness Ins. Co., 530 F.3d 395, 398–99 (5th Cir. 2008); see
also Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150–51 (2000).
21 Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994).
22 Hibernia Nat. Bank v. Carner, 997 F.2d 94, 98 (5th Cir. 1993) (citing Amoco Prod. Co. v. Horwell
Energy, Inc., 969 F.2d 146, 147–48 (5th Cir. 1992)).
14
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[the record] which it believes demonstrate the absence of a genuine issue of material
fact.” 23 If the dispositive issue is one on which the non-moving party will bear the burden
of persuasion at trial, to satisfy Federal Rule of Civil Procedure 56’s burden, the moving
party must do one of two things: it “may submit affirmative evidence that negates an
essential element of the nonmoving party’s claim” or “demonstrate to the Court that the
nonmoving party’s evidence is insufficient to establish an essential element of the
nonmoving party’s claim.” 24 When the moving party chooses the latter option it:
must affirmatively show the absence of evidence in the record. This may
require the moving party to depose the nonmoving party’s witnesses or to
establish the inadequacy of documentary evidence. If there is literally no
evidence in the record, the moving party may demonstrate this by reviewing
for the court the admissions, interrogatories, and other exchanges between
the parties that are in the record. 25
If the moving party fails to carry this burden, the motion must be denied.
If the moving party successfully carries its burden, the burden of production then
shifts to the non-moving party to direct the Court’s attention to something in the
pleadings or other evidence in the record setting forth specific facts sufficient to establish
that a genuine issue of material fact does indeed exist. 26 Thus, the non-moving party may
defeat a motion for summary judgment by “calling the Court’s attention to supporting
evidence already in the record that was overlooked or ignored by the moving party.” 27
“[U]nsubstantiated assertions are not competent summary judgment evidence.” 28
Rather, “the party opposing summary judgment is required to identify specific evidence
in the record and to articulate the precise manner in which that evidence supports his or

Celtic Marine Corp. v. James C. Justice Cos., 760 F.3d 477, 481 (5th Cir. 2014) (quoting Celotex, 477 U.S.
at 323).
24 Celotex, 477 U.S. at 331.
25 Id. (internal citation omitted).
26 Id. at 322–25.
27 Id. at 332–33.
28 Ragas v. Tenn. Gas Pipeline Co., 136 F.3d 455, 458 (5th Cir. 1998) (citing Celotex, 477 U.S. at 324).
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her claim. ‘Rule 56 does not impose upon the district court a duty to sift through the
record in search of evidence to support a party’s opposition to summary judgment.’” 29
ANALYSIS
Generally, the seller of a home impliedly warrants to the buyer that the property is
free from redhibitory vices or defects. 30 Louisiana Civil Code article 2520 defines a
redhibitory defect as one that:
renders the thing useless, or its use so inconvenient that it must be
presumed that a buyer would not have bought the thing had he known of
the defect. The existence of such a defect gives a buyer the right to obtain
rescission of the sale.
A defect is redhibitory also when, without rendering the thing totally
useless, it diminishes its usefulness or its value so that it must be presumed
that a buyer would still have bought it but for a lesser price. The existence
of such a defect limits the right of a buyer to a reduction of the price. 31
A redhibitory defect must be latent and have existed at time of sale, as the implied
warranty against redhibitory defects covers only hidden defects, not defects known to the
buyer at the time of sale. 32 Even when a home is sold “as is,” “it is well-settled under
Louisiana law that a seller may not fail to disclose a defect or actively conceal it and then
employ a waiver to contract out of its obligation to disclose that defect.” 33
In their motion for summary judgment, Defendants argue that summary judgment
is warranted in this case because Plaintiff’s home inspector, Mr. Turner, did not discover

29 Id. (quoting Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 915–16 & n.7 (5th Cir. 1992)) (citing Forsyth
v. Barr, 19 F.3d 1527, 1537 (5th Cir. 1994)).
30 La. C.C. art. 2520.
31 Id.
32 Id.
33 Jones v. Wells Fargo Bank, N.A., 626 F. App’x 500, 506 (5th Cir. 2015); see also Shelton v. Standard/700
Assocs., 798 So. 2d 60, 64 (La. 2001) (explaining that “fraud in the inducement of a contract cannot be
waived,” and that “although the warranty against redhibitory defects may be excluded or limited, a seller
cannot contract against his own fraud and relieve himself of liability to fraudulently induced buyers”);
Schmuck v. Menees, 131 So. 3d 277, 281 (La. App. 5 Cir. 2013) (“[A] seller with knowledge of a redhibitory
defect, who, rather than informing the buyer of the defect opts to obtain a waiver of the warranty implied
by law, commits fraud, which vitiates the waiver because it is not made in good faith.” (citation and internal
quotation marks omitted)).

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“any significant problems with the home in question” 34 and testified that during his May
3, 2016 inspection that “he did not detect the presence of mold in the home, nor did he
suspect the presence of mold.” 35 Defendants also submit they had no knowledge of any
defects in the home that were not either repaired or disclosed to Plaintiffs prior to sale. 36
Defendants argue “[t]he fact that [P]laintiffs may have experienced such problems after
the sale, and after a prolonged period of heavy rain . . . is not sufficient to establish that
the complained of defects existed at the time of sale. 37
Contrary to Defendants’ assertion, genuine issues of material fact exist in this case
as to whether the defects existed at the time of sale and whether Defendants had
knowledge of those defects. For example, Defendants contend “[t]here is no evidence that
the Dunns experienced any moisture intrusion problems or mold related issues in the
residence during the entire time they lived in the home” 38 and that “Michael Turner,
[P]laintiffs’ home inspection expert, does not have any information or reason to believe
that the Dunns experienced condensation or moisture-related problems in the home at
any time prior to the time of his inspection of the home on May 3, 2016.” 39 In his
supplemental report, however, Mr. Turner noted that during his follow-up inspection on
July 12, 2016:
It was evident that water had indeed entered the structure as revealed by
some drywall that had been removed with a distinct musky odor behind the
wall and stains being present on the ceiling. The use of a moisture meter
also determined that the wall under the window had a 100% moisture
content. 40

R. Doc. 25-1 at 16.
Id.
36 R. Doc. 25-19 at ¶ 14, 18.
37 Id. at 17–18.
38 R. Doc. 25-19 at ¶ 14.
39 Id. at ¶ 18.
40 R. Doc. 29-6 at 16.
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Mr. Turner further explained during his deposition that “installation of spray foam
insulation,” which Plaintiffs contend was done improperly prior to sale, 41 “could have an
effect on water or condensation being captured in the walls.” 42 In addition to Mr. Turner’s
testimony, Plaintiffs submit a report from Environmental Investigators (“Ei6”), which
explains:
CA Labs found high levels of Stachybotrys on the sheetrock; high levels, with
hyphae, which indicates that the mold is actively growing. Ei6 opines that
the water intrusion in the Page residence on Pike Drive has been occurring
for an extended period of time, definitely considerably longer than the
approximately 1 month that the Page’s have lived in the house since they
purchased it. It is unlikely that the seller/previous owner was unaware of
the water intrusion. 43
Thus, genuine issues of material fact regarding whether the home contained water
damage at the time of sale and whether the Dunns had knowledge of the water damage
remains, and summary judgment is inappropriate at this stage of the proceedings.
Accordingly;
CONCLUSION
For the foregoing reasons, IT IS ORDERED that Defendants’ motion for
summary judgment be and hereby is DENIED. 44
New Orleans, Louisiana, this 21st day of November, 2017.
________________________________
SUSIE MORGAN
UNITED STATES DISTRICT JUDGE

R. Doc. 22 at XV(U).
R. Doc. 29-6 at 12.
43 R. Doc. 29-3 at 2.
44 R. Doc. 25.
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