Order Michigan Supreme Court
Lansing, Michigan
June 17, 2009 Marilyn Kelly,
Chief Justice
Michael F. Cavanagh
Elizabeth A. Weaver
Maura D. Corrigan
137749 Robert P. Young, Jr.
Stephen J. Markman
Diane M. Hathaway,
Justices
RICHARD R. ROBERTS and STACEY D.
ROBERTS,
Plaintiffs-Appellants,
SC: 137749
v COA: 275458
Leelanau CC: 05-007063-CK
ROBERT L. SAFFELL and JOANNE O.
SAFFELL,
Defendants-Appellees.
_________________________________________/
On May 13, 2009, this Court heard oral argument on the application for leave to
appeal the August 21, 2008, judgment of the Court of Appeals. On order of the Court,
the application is again considered and, pursuant to MCR 7.302(G)(1), in lieu of granting
leave to appeal, we AFFIRM the judgment of the Court of Appeals. Plaintiffs
unknowingly purchased a termite-infested house from defendants. Under the Seller
Disclosure Act (SDA), MCL 565.951 et seq., defendants were required to prepare a
Seller’s Disclosure Statement (SDS) regarding “the condition and information concerning
the property, known by [sellers.]” MCL 565.957(1). In response to the question
concerning whether the house had a “history of infestation . . . (termites, carpenter ants,
etc.),” defendants, “based on [their] knowledge at the signing of this document,”
answered “no” on the SDS. Id. Once plaintiffs subsequently discovered a termite
problem, they initiated a claim for innocent misrepresentation, which requires a showing
that defendants: (1) made a false statement in a transaction with plaintiff, (2) without
knowledge of that statement’s falsity, (3) which statement actually deceived plaintiffs,
and (4) on which plaintiffs detrimentally relied, with the benefit inuring to defendants.
United States Fidelity & Guaranty Co v Black, 412 Mich 99, 116 (1981). However, the
SDA provides that a seller is “not liable for any error, inaccuracy, or omission in any
information delivered pursuant to this act if the error, inaccuracy, or omission was not
within the personal knowledge of the transferor . . . .” MCL 565.955(1). Thus, because a
claim for innocent misrepresentation requires that a defendant make a false statement
without knowledge of its falsity, the Court of Appeals correctly held that innocent
2
misrepresentation does not constitute a viable cause of action under the SDA. Whether
defendants did or did not possess personal knowledge of the infestation is a matter not
before this Court as a result of plaintiffs’ abandonment of their fraudulent
misrepresentation claim and their exclusive focus on their innocent misrepresentation
claim.
I, Corbin R. Davis, Clerk of the Michigan Supreme Court, certify that the
foregoing is a true and complete copy of the order entered at the direction of the Court.
June 17, 2009 _________________________________________
Clerk