Holley v. Dan-Sa, Inc.

THIS OPINION HAS NO PRECEDENTIAL VALUE. IT SHOULD NOT BE
CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING
EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Clifford D. Holley and Sharon Holley, Appellants,

v.

Dan-Sa, Inc.; Charles E. Oman; Janis M. Niemi; Gina L.
Pike; Dermac Contractors, LLC; Bluewater Development
of South Carolina, LLC; and Blue Ridge Savings Bank,
Inc., Defendants,

Of whom Charles E. Oman and Janis M. Niemi are the
Respondents.

Appellate Case No. 2015-000652

Appeal From Kershaw County
G. Thomas Cooper, Jr., Circuit Court Judge

Unpublished Opinion No. 2017-UP-243
Heard December 6, 2016 – Filed June 14, 2017

AFFIRMED

H. Freeman Belser and William Clayton Dillard, Jr., both
of Belser & Belser, PA, of Columbia; and Stephen C.
Burn, Jr., of Burn Law Firm, LLC, of Lexington, for
Appellants.
Catharine H. Garbee Griffin and Jonathan Blake Asbill,
both of Baker Ravenel & Bender, LLP, of Columbia, for
Respondents.

PER CURIAM: In this negligence action, Clifford D. Holley and Sharon Holley
(collectively, the Holleys) appeal the circuit court's order granting summary
judgment to Charles E. Oman and Janis M. Niemi (collectively, Respondents). On
appeal, the Holleys raise the following issues: whether (1) the circuit court erred in
holding Respondents' burial of organic debris on their property was not a material
fact in the sale of the property; (2) a vendor of partially improved land has a duty to
disclose known, latent defects affecting the suitability of the land for further
residential improvements; (3) a vendor's liability for failing to disclose land defects
extends to a subvendee; (4) the circuit court erred in holding the Holleys' damages
were not caused by Respondents' failure to disclose buried debris; and (5) a
residential lot owner who constructs home foundation footings on the lot and then
sells it to a builder to complete construction of a speculative home owes a duty of
care to a subsequent owner of the fully constructed home. We affirm.

As to whether Respondents owed a duty of care to the Holleys in the clearing
of the land and construction of the retaining wall and footings, we find the circuit
court did not err in granting summary judgment. Because Respondents did not
perform any work with the intention of selling the property, they owed no duty of
care to subsequent purchasers to maintain the property in a certain condition or to
refrain from any activity affecting the property. See Smith v. Breedlove, 377 S.C.
415, 424, 661 S.E.2d 67, 72 (2008) ("[T]he crucial undisputed fact is that Breedlove,
when he constructed the residence, did not build or plan to build the home for anyone
but his family. He simply did not owe a duty to any future purchaser when no such
sale was reasonably expected."); id. at 425, 661 S.E.2d at 72–73 ("To hold that a
duty arose because it was foreseeable that Breedlove would eventually sell the
property, in light of the evidence in the record that the sole purpose for construction
was as a permanent residence for Breedlove himself, would completely obviate the
foreseeability requirement in determining the existence of a duty."); cf. Terlinde v.
Neely, 275 S.C. 395, 399, 271 S.E.2d 768, 770 (1980) (holding that because the
home was built for "speculative" sale, "the home builder [could not] reasonably
argue he envisioned anything but a class of purchasers" and the plaintiffs, as
members of that class, were "entitled to a duty of care in construction commensurate
with industry standards").
We acknowledge that it appears Respondents changed their plans in July 2007
and decided to construct a "stick built" home rather than use the modular home as
their residence. However, nothing in the record indicates Respondents performed
any work with the intention of selling the property. The record contains a disclosure
statement signed by Niemi in which she stated she was seeking a permit to construct
a building "for [her] own use and occupancy." Additionally, Oman submitted an
affidavit in which he stated he and Niemi intended to reside on the property in a
modular home when they cleared the lot in February 2007. He stated he and Niemi
planned to move the modular home to the smaller of the two lots, and around July
2007, they constructed footings and built a retaining wall. Oman stated he and Niemi
entered into a contract to sell the property to a construction company, Dan-Sa, Inc.
(Dan-Sa), in October 2007, and they provided Dan-Sa with plans for a house that
could be built on the footings. Based on this evidence, we find the instant case is
similar to Breedlove because at the time Respondents cleared the lot, buried the
debris, and constructed the footings and retaining wall, they intended to reside on
the property and had no intention of placing the property in the stream of commerce.
Accordingly, because Respondents did not owe the Holleys a duty of care, we find
the circuit court properly granted summary judgment on this issue.1 See Dorrell v.
S.C. Dep't of Transp., 361 S.C. 312, 318, 605 S.E.2d 12, 15 (2004) ("In a negligence
action, a plaintiff must show that the . . . defendant owed a duty of care to the
plaintiff . . . ."); see also Hurst v. E. Coast Hockey League, Inc., 371 S.C. 33, 37, 637
S.E.2d 560, 562 (2006) ("If there is no duty, then the defendant in a negligence action
is entitled to a judgment as a matter of law.").

1
Additionally, the Holleys want this court to consider the statutorily-required
building permit disclosure form signed by Niemi. On the form, Niemi
acknowledged that if she sold or rented a building that she built within two years
after the construction was completed, the law would presume she built it for sale or
rent, in violation of an exemption permitting a person without a residential building
license to build his or her own house. During the summary judgment hearing, the
Holleys mentioned the permit and argued that pursuant to the permit, an owner is
responsible for any work performed by subcontractors. However, the Holleys never
specifically raised the two-year presumption to the circuit court, and the circuit court
did not mention the presumption in its order. See I'On, L.L.C. v. Town of Mt.
Pleasant, 338 S.C. 406, 421, 526 S.E.2d 716, 724 (2000) ("[A]ll parties should raise
all necessary issues and arguments to the lower court and attempt to obtain a
ruling."); West v. Newberry Elec. Coop., 357 S.C. 537, 543, 593 S.E.2d 500, 503
(Ct. App. 2004) (holding an issue was unpreserved when it was not addressed in the
final order). Thus, we find this argument is not preserved.
As to whether the circuit court erred in holding the Holleys' damages were not
caused by Respondents' failure to disclose the buried debris, we find the circuit court
properly granted summary judgment to Respondents on this issue. Even if
Respondents had disclosed the buried debris to Dan-Sa, the disclosure would not
have reached the Holleys because of the intervening transfers. Dan-Sa executed a
deed in lieu of foreclosure to Blue Ridge Savings Bank, Inc. (Blue Ridge) and was
not required to complete a Residential Property Condition Disclosure Statement. See
S.C. Code Ann. § 27-50-30(2) (2007) (stating a disclosure statement need not be
completed in a transfer "to a mortgagee from the mortgagor or his successor in
interest in a mortgage if the indebtedness is in default"). Blue Ridge subsequently
sold the property to Gina Pike. In the contract between Blue Ridge and Pike, the
parties agreed the property would be sold as-is and agreed that Blue Ridge would
not complete or provide a disclosure statement. See § 27-50-30(13) (stating a
Residential Property Condition Disclosure Statement need not be completed "when
both parties agree in writing not to complete a disclosure statement").

Moreover, the record contains no evidence to support the contention that if
Respondents had disclosed the buried debris to Dan-Sa, Dan-Sa would have
removed the debris or would have constructed the house and porch differently.
Although Danny Gibson, Sr., the owner of Dan-Sa, stated he would have expected
the burial of debris to be disclosed and thought it was a problem to have organic
materials buried under a house, after reviewing a picture of the excavation of the
debris, he stated the debris would not have affected the structural integrity of the
house if it had not been removed and stated that if the Holleys "had never dug that
pool, the house would still be there . . . 40 years from now." In light of these
statements, we find there is no evidence that if Respondents had disclosed the debris,
Dan-Sa would not have built the house and porch without first removing the buried
debris or would have constructed the house and porch differently. Thus, the Holleys
failed to provide sufficient evidence to establish that Respondents' failure to disclose
the buried debris to Dan-Sa was the cause of their damages. See Cody P. v. Bank of
Am., N.A., 395 S.C. 611, 620, 720 S.E.2d 473, 478 (Ct. App. 2011) ("To show the
defendant was the proximate cause of the injury, the plaintiff must establish the
defendant was both the cause-in-fact and the legal cause of the injury."); id. ("The
cause-in-fact requirement is proved by showing the injury would not have occurred
but for the defendant's negligence."); see also Hubbard v. Taylor, 339 S.C. 582, 591,
529 S.E.2d 549, 553 (Ct. App. 2000) ("[E]ven if there were a duty, [the appellant]
failed to establish proximate causation . . . ."). Accordingly, we find the circuit court
properly granted summary judgment to Respondents on the Holleys' cause of action
for failure to disclose. See Rule 56(c), SCRCP (stating summary judgment is proper
when "there is no genuine issue as to any material fact and . . . the moving party is
entitled to a judgment as a matter of law").

Because the causation issue is dispositive of whether Respondents were liable
to the Holleys for failing to disclose the buried debris, we need not address the
remaining issues. See Futch v. McAllister Towing of Georgetown, Inc., 335 S.C.
598, 613, 518 S.E.2d 591, 598 (1999) (holding appellate courts need not address
remaining issues when the resolution of a prior issue is dispositive).

AFFIRMED.

LOCKEMY, C.J., and THOMAS and GEATHERS, JJ., concur.