Home inspector may owe duty to subsequent purchasers, may be jointly liable
to them with real estate agent who fails to discover defects, and may be liable
for indemnity to the real estate agent.
Leko v. Cornerstone, ___ Cal.App.4th ___, ___ Cal.Rptr.2d - (2001).
A real estate agent was being sued for falling to disclose defects in residential
property he had sold. The agent cross-claimed for equitable indemnity against
a home inspection company that had inspected for the purchaser and another that
had inspected for a previous prospective purchaser of the same property, neither
of which found or disclosed the defects. The trial court dismissed the cross
claims after granting the inspectors' motions for judgment on the pleadings
and summary judgment.
On appeal, the Second District reversed. Citing American Motorcycle v. Superior
Court, 20 Cal.3d 578 (1978), the court noted that when the negligent acts of
two tortfeasors are both a proximate cause of an indivisible injury, the tortfeasors
are jointly and severally liable for the damages and are liable for equitable
indemnity to each other. Since the purchaser was alleging an indivisible injury
-- the purchase of a defective home -- the liability of the inspectors would
depend on whether they owed the purchaser a duty. The inspection company hired
by the purchaser obviously owed him a duty to act reasonably in performing its
assigned task. The court cited Bily v. Arthur Young, 3 Cal.4th 370 (1992), as
authority for the rule that a professional supplier of information owes a duty to third parties that he knows are likely to rely on the
information supplied. Since a question of fact exists as to whether the inspector
who was hired by a previous prospective purchaser had such knowledge, the trial
court should not have disposed of the case on motion.
Joint tortfeasor who is strictly liable may be required to pay equitable
indemnity, based on allocation of fault, to a joint tortfeasor who is liable
for negligence.
Expressions v. Ahmanson, ___ Cal.App.4th ___, ___ Cal.Rptr.2d ___ (2001).
Plaintiff brought an action for construction defects in a building, including
defects in the roof. After the general contractor settled with plaintiff, it
sought indemnity from a supplier of roofing tiles, whom the plaintiff had also
sued. The general contractor claimed that because the supplier would have been
strictly liable to the plaintiff for all the damage caused by defects in the
roof, it should have to indemnify the general contractor for all damages attributed
to those defects. The tile supplier argued that it should only have to pay a
percentage based on an apportionment of fault, but the trial court entered judgment
for the entire amount.
On appeal, the Fourth District reversed. Citing American Motorcycle v. Superior
Court, 20 Cal.3d 578 (1978), the court noted that the general contractor and
the supplier were joint tortfeasors, subject to joint and several liability
to the plaintiff. But the court said that different policies underlie the concepts
of joint and several liability and equitable indemnity. The purpose of joint
and several liability is to allow a plaintiff to collect all its damages, regardless
of the fact that one of the joint tortfeasors might not have a deep enough pocket,
while the purpose of equitable indemnity is to apportion losses among joint
tortfeasors in proportion to their relative culpability. The court said that
GEM v. Hallcraft, 213 Cal.App.3d 419 (1989), established that a tortfeasor seeking
equitable indemnity can rely on any theory that would have been available to
the injured plaintiff. It added, however, that while this permits the action
for indemnity to be based on strict liability it does not change the rule established
by American Motorcycle, which requires that equitable indemnity be based on
apportionment of fault.
For more legislation information, see the California Legislation Web Site at http://www.leginfo.ca.gov.
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