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Docket Number

45745.

Attorney(S)

Adams, Barfield Dunaway, David Dunaway, for appellant. Don H. Taliaferro, for appellee. Quentin S. King, Edward C. Stone, amicus curiae.

Judges

CLARKE, Presiding Justice.

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Smart Summary

Crawford v. Williams et al., Supreme Court of Georgia (Dec. 19, 1989) — Case Summary

Docket: 45745. Certiorari to the Court of Appeals of Georgia (186 Ga. App. 643, 368 S.E.2d 337 (1988)). Opinion by Presiding Justice Clarke. Counsel for parties and amicus listed in the opinion.

Factual and Procedural Background

Petitioner Crawford sold a 3.54-acre tract in rural Pike County to Mr. and Mrs. Williams. The Williams purchased the tract believing it encompassed a house, a well, and a driveway. Two years after the sale they discovered that the well and part of the driveway were not located on the 3.54-acre tract. The Williams sued Crawford alleging that he had fraudulently represented that the well and driveway were on the property sold.

Crawford did not represent that he knew his property’s exact boundaries. A real estate agent who showed the property identified the well as the water source for the property and provided information about the well’s depth without mentioning that the well was off the property. The agent also told the Williams that they did not need a new survey because an earlier survey would suffice. The Williams did not examine the existing plat or obtain a new survey before purchase, and they did not walk the property to locate boundary markers or ask whether the well and driveway were on the property.

The Williams also alleged that the house was not entirely on their land, but a subsequent survey showed the house was on the 3.54-acre tract and the Williams appear to have conceded that point.

Procedurally, Crawford moved for summary judgment, asserting that the Williams had not shown any actionable misrepresentation and had failed to exercise due diligence to protect themselves. The trial court granted summary judgment for Crawford, finding the Williams had not used ordinary means to discover the property boundaries. The Court of Appeals reversed, holding (1) the record did not demonstrate as a matter of law that no fraud occurred, and (2) failure to obtain a survey does not constitute lack of due diligence as a matter of law. The Georgia Supreme Court granted certiorari, considered the matter, and reversed the Court of Appeals, concluding that summary judgment for Crawford was appropriate.

Legal Issues Presented

Whether, under the evidence presented and applicable law, the plaintiffs (the Williams) raised a triable issue of fact on each element of the tort of fraud sufficient to defeat a defendant's motion for summary judgment.
Whether a purchaser's failure to obtain a survey as a matter of course constitutes a lack of due diligence (i.e., whether not obtaining a survey is, as a matter of law, fatal to a claim of justifiable reliance).
Whether, given the specific undisputed circumstances here, the Williams' lack of investigation (including not examining the existing plat or walking the property) precludes a finding of justifiable reliance necessary for fraud.

Arguments of the Parties

Appellant (Crawford)

Moved for summary judgment on the ground that the Williams had not demonstrated any misrepresentation by Crawford sufficient to establish fraud.
Contended the Williams failed to exercise due diligence to protect themselves from any alleged fraud (i.e., they made no effort to discover the true boundaries), and thus could not have justifiably relied on any alleged representations.

Appellees (Williams)

Alleged that Crawford fraudulently represented that the well and driveway were located on the 3.54-acre tract they purchased.
Relied on representations made during the sale process (including statements by the real estate agent regarding the well) and on the absence of a survey before purchase; the Court of Appeals also treated their failure to obtain a survey as not necessarily constituting lack of due diligence as a matter of law.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Hardy v. Gordon, 146 Ga. App. 656, 247 S.E.2d 166 (1978)	Defines the five elements of the tort of fraud: (1) false representation by defendant, (2) scienter, (3) intent to induce plaintiff to act or refrain from acting, (4) justifiable reliance by plaintiff, and (5) damage to plaintiff.	The Court cited Hardy to state the elements that the Williams must raise a triable issue on to survive summary judgment.
Ham v. Ham, 230 Ga. 43, 195 S.E.2d 429 (1973)	Explains summary judgment standard in fraud cases: for an action for fraud to survive summary judgment there must be some evidence from which a jury could find each element; courts must resolve factual disputes and draw all reasonable inferences in favor of the nonmoving party.	The Court cited Ham to set the standard for assessing whether the evidence raised triable issues of fact on each element of fraud.
Williams v. Crawford, 186 Ga. App. 643, 368 S.E.2d 337 (1988) (Court of Appeals)	(Court of Appeals decision) Held that the record did not demonstrate as a matter of law that no fraud occurred and that failure to obtain a survey does not constitute lack of due diligence as a matter of law.	The Supreme Court reviewed and reversed the Court of Appeals’ holding: while agreeing that failure to obtain a survey is not per se lack of due diligence, the Supreme Court found the facts here showed complete lack of effort to ascertain boundaries, supporting summary judgment for the seller.
Miller v. Clabby, 178 Ga. App. 821, 344 S.E.2d 751 (1986)	Principle that the law does not afford relief to one who suffers by not using ordinary means of information, whether the neglect is due to indifference or credulity.	The Court quoted Miller to support the conclusion that a purchaser who makes no attempt to discover property boundaries cannot be said to have justifiably relied on alleged misrepresentations about those boundaries.

Court's Reasoning and Analysis

The Court began by reiterating the five elements of the tort of fraud (Hardy) and the summary-judgment standard requiring some evidence to allow a jury to find each element, with all factual disputes resolved and reasonable inferences drawn in favor of the nonmoving party (Ham).

Construing disputed facts in favor of the Williams (the nonmoving party), the Court recited the following relevant facts: the Williams believed the tract included a house, a well, and a driveway; two years later they learned the well and part of the driveway were off the tract; the real estate agent identified the well as the property's water source and provided depth information without mentioning that it was off the property; the agent referred the Williams to an existing plat prepared years earlier and told them they did not need a new survey; the Williams did not examine the existing plat or obtain a new survey, did not walk the property to find boundary markers, and did not ask whether the well and driveway were on the property.

The Court explicitly stated it agreed with the Court of Appeals that failure to obtain a survey is not, by itself, a lack of due diligence as a matter of law. However, the Court distinguished that general rule from the present facts, concluding the Williams made no discernible effort to ascertain the boundaries by any ordinary means. The Court emphasized that a plat existed and the agent had referred the purchasers to it; a review of the plat and comparison to the ground would have revealed the well and driveway were not on the 3.54-acre tract.

The law does not afford relief to one who suffers by not using the ordinary means of information, whether the neglect is due to indifference or credulity.

Relying on Miller v. Clabby, the Court concluded that a purchaser who makes no attempt to discover boundaries cannot be said to have "justifiably relied" on a seller's alleged misrepresentation about those boundaries. Because the Williams failed to present evidence that would raise a triable issue on the justifiable reliance element of fraud, there was no genuine issue of material fact as to an essential element, and summary judgment for Crawford was appropriate.

The Court also noted (in a factual observation) that Crawford stated in deposition that he knew the well was not on the property but had told the real estate agent it was the property's water source; the opinion cautioned that misrepresentations by a real estate agent without the seller’s knowledge or approval could not, by themselves, subject the seller to liability for fraud. This point was mentioned to underscore limits on vicarious liability when agent statements are not attributable to the seller.

Holding and Implications

Holding: Judgment reversed. The Supreme Court reversed the Court of Appeals, concluding that summary judgment in favor of Crawford was appropriate because the Williams failed to raise a triable issue on the element of justifiable reliance necessary for a fraud claim.

Direct consequences: The trial court's granting of summary judgment for Crawford is supported by the Supreme Court’s opinion—because there was no genuine issue of material fact on the Williams' justifiable reliance, the fraud claim cannot proceed to trial on the record presented.

Broader implications: The Court reaffirmed two propositions stated in the opinion: (1) a buyer's failure to obtain a survey is not automatically lack of due diligence as a matter of law, and (2) however, a purchaser who makes no attempt by ordinary means (e.g., examining an available plat, walking the property, or asking pertinent questions) to discover boundaries cannot claim justifiable reliance on alleged misrepresentations about property boundaries. The opinion does not announce a new legal rule beyond applying these principles to the specific facts; rather, it applies existing precedent to conclude there was no triable issue on reliance here.

All the Justices concurred.

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CRAWFORD v. WILLIAMS et al.

CLARKE, Presiding Justice.

In this action to recover damages for fraud the trial court granted summary judgment to the defendant. The Court of Appeals reversed. Williams v. Crawford, 186 Ga. App. 643 ( 368 S.E.2d 337) (1988). We granted certiorari and now reverse.

The tort of fraud has five elements: a false representation by a defendant, scienter, intention to induce the plaintiff to act or refrain from acting, justifiable reliance by plaintiff, and damage to plaintiff. Hardy v. Gordon, 146 Ga. App. 656 ( 247 S.E.2d 166) (1978). For an action for fraud to survive a motion for summary judgment, there must be some evidence from which a jury could find each element of the tort. In deciding whether the evidence presented is sufficient to raise a triable issue as to each element, the court must resolve all disputes of fact and indulge all reasonable inferences therefrom in favor of the nonmoving party. Ham v. Ham, 230 Ga. 43 ( 195 S.E.2d 429) (1973).

Construing all disputed facts in favor of the nonmoving party here, the facts are as follows. Petitioner Crawford sold a 3.54 acre tract of land in rural Pike County to Mr. and Mrs. Williams. The Williams bought the property believing that it encompassed an area containing a house, a well and a driveway. Two years after the sale they learned that the well and part of the driveway were not on their land. They sued Crawford alleging that he had fraudulently misrepresented that the well and driveway were located on the property being sold. Crawford did not represent to the Williams that he knew the exact boundaries of his property; however, the real estate agent showing the property identified the well as the water source for the property and provided information about the depth of the well without mentioning that it was not located on the property. The agent also told them that they did not have to prepare a survey since one prepared several years earlier would suffice. The Williams did not examine the existing survey or have a new survey made.

When the Williams brought this action, they also alleged that the house is not entirely on their land. A survey of the property demonstrates, however, that the house is on the 3.54 acre tract. It appears that they now concede that the house is on the property.

Crawford moved for summary judgment asserting that the Williams had not demonstrated any misrepresentation and that the Williams had not exercised due diligence to protect themselves from the alleged fraud. The trial court granted summary judgment in favor of Crawford, finding that the Williams had not used ordinary means of information to discover the boundaries of the property. The Court of Appeals reversed. The Court of Appeals held (1) the record did not demonstrate as a matter of law that no fraud occurred; and (2) that although the Williams could have protected themselves by commissioning a survey of the property, failure to obtain a survey does not constitute a lack of due diligence as a matter of law.

The Court of Appeals opinion did not recite the facts that it relied on in so holding. We note, however, that Crawford stated in deposition that he knew that the well was not on the property, but he told the real estate agent that the well was the water source for the property. We make this note to underscore the fact that misrepresentations made by a real estate agent without the knowledge or approval of the seller could not subject the seller to liability for fraud.

We agree with the Court of Appeals that failure to obtain a survey does not constitute a lack of due diligence as a matter of law. We reverse, however, because the facts of this case demonstrate a complete lack of any effort to ascertain the boundaries of the property. A survey is not the only means of finding property lines. The Williams did not walk around the property to try to find the boundary markers; did not commission a survey or examine the existing survey; and did not even ask whether the well and the driveway were on the property. The original plat prepared years before the sale showed the location of the lines. The real estate agent referred the Williams to this plat. A review of this plat and its application to the lines as they exist on the ground would have revealed that the well and the driveway are not located on the property; but the Williams failed to avail themselves of this opportunity.