Breach of Contract • Rescission • Residential and Commercial Real Estate

Thomas Brogan v. Rosenn, Jenkins & Greenwald, PICS Case No. 14-0138 (C.P. Lackawanna Jan. 31, 2014) Nealon, J. (27 pages).

Defendants Rosenn, Jenkins & Greenwald moved for summary judgment, as there were factual issues relative to the question of causation. Summary judgment was denied.

Plaintiffs Thomas and Wendy Brogan filed a civil action against their former counsel, title searcher and title insurance company for damages related to the purchase of real estate that included an undisclosed recorded utility easement and accompanying building restrictions. The Brogans sought to purchase 4.1 acres of vacant land owned by non-party Douglas Pinnell. They retained a local realtor and hired Rosenn to represent them with the transaction. Upon viewing the property, Brogan noticed a partially protruding subterranean pipe on the property; Brogan questioned Pinell and co-defendant David Chuff with both indicating “that there was no one who had any rights or any ownership interests with regard to Pinenell’s land.” A title search was also conducted prior to the purchase. On November 2006, the Brogans executed an agreement of sale for $80,000.

It was undisputed that all parties involved failed to discover the recorded utility easement and the land restrictions. The Brogans, upon inquiry, allegedly learned they would need to connect their water and sewer service to their property.

Rosenn sought summary judgment arguing the Brogans were contractually required to proceed even if the easement was discovered before the purchase. Rosenn maintained the Brogans waived their right to make the purchase contingent upon an acceptable water connection which would have afforded them a basis to avoid the contract. The title insurer argued the easement was not covered by the plain language of the title insurance policy as the easement did not constitute a title defect. The Brogans opposed the summary judgment arguing Rosenn represented their interest and the waiver did not absolve Rosenn of liability; further, the existence of a utility easement created a title defect.

The court denied Rosenn’s summary judgment ruling that, despite the seller’s misrepresentation, the land use restrictions could have furnished a basis for equitable rescission of the land sale contract. Further, there are triable issues of fact as whether the Brogans would have waived certain contractual contingencies had they had knowledge of the utility easement and restrictions. As there were triable issues of fact relative to causation, summary judgment was denied. The court also denied the title insurer’s motion for summary judgment holding that the credibility and facts whether the Brogans “assumed or agreed to” the encumbrance was to be reserved for the jury.