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Renick v. Sperau

United States District Court, Fourth Circuit

May 14, 2013



CATHERINE C. BLAKE, District Judge.

Plaintiffs Braden and Rebecca Renick claim damages resulting from lead hazards discovered in a house they purchased from defendants Daniel and Melissa Sperau. Defendant ELTG, LLC, a licensed producer of title insurance, performed the title search on the property and conducted the settlement for purchase. The Renicks filed this suit against the Speraus alleging violations of the Residential Lead-Based Paint Hazard Reduction Act, intentional misrepresentation, and negligent misrepresentation, and against ELTG alleging negligent misrepresentation. Now pending is ELTG's motion for summary judgment[1] on the negligent misrepresentation claim and request for a hearing. (ECF No. 53.) The Renicks have filed a memorandum in opposition to ELTG's motion. (ECF No. 55.) No hearing is necessary. See Local Rule 105.6. For the following reasons, ELTG's motion for summary judgment will be denied.


In the summer of 2011, the Renicks purchased a home located at 411 Woodlawn Road, Baltimore, Maryland from the Speraus. (Pls.' Opp.[3] at 1, ECF No. 55; Def.'s Mem. at 1, ECF No. 53-1.) The Speraus had owned the home since at least 2005. (Pls.' Opp. at 1.) The Renicks and the Speraus executed a contract of sale in February 2011. (Def.'s Mem. at 2.)

On June 16, 2011, the Renicks requested that ELTG provide "[f]ull copies of any judgments or liens" on the property. (Title Request Form, Mot. Summ. J., Ex. E, ECF No. 53-7.) A Baltimore City lien certificate issued on June 20, 2011, and valid until August 4, 2011, listed three items for the address 411 Woodlawn Road: a real property lien marked paid on December 17, 2010, in the amount of $11, 204.56; a metered water lien marked paid on May 19, 2011, in the amount of $121.06; and a lead paint violation with a phone number to call for more information. (Lien Certificate at 1, Mot. Summ. J., Ex. F, ECF No. 53-8.) ELTG then produced a title report noting: "Judgments: N/F" and "Taxes & Other Liens: #XX-XX-XXXX-XXX; PAID $11, 204.56 on 12-17-10."[4] (Title Report, Mot. Summ. J., Ex. G, ECF No. 53-9.) ELTG also conducted the settlement for the sale of the property on July 15, 2011. (Pls.' Opp. at 2; Def.'s Mem. at 1, 2.)

As sellers of the property, the Speraus completed a disclosure statement affirming that they had no knowledge of lead-based paint or lead-based paint hazards in the house and had received no reports or records pertaining to such hazards. (Def.'s Mem. at 2-3.) The Renicks allege that the Speraus received two letters from the Baltimore City Health Department, dated March 31, 2006, and April 15, 2009, notifying them that there were lead hazards on the property. (Pls.' Opp. at 1-2.) They also claim that the Speraus failed to abate the lead hazards on the property and that Baltimore City entered a written notice of the outstanding violation in the municipal records, which constituted an encumbrance on the title. ( Id. at 2.) On or about August 31, 2011, the Renicks, who had inhabited the house, received a "violation notice and order to remove lead hazard" from the Baltimore City Health Department listing the lead hazards identified in the March 31, 2006, notice. ( Id. )

Legal Standard

A court may properly award summary judgment when the record shows that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Emmett v. Johnson, 532 F.3d 291, 297 (4th Cir. 2008). A genuine dispute about a material fact exists only "if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). When reviewing a motion for summary judgment, the court must look at the facts and inferences drawn therefrom in the light most favorable to the non-moving party. Scott v. Harris, 550 U.S. 372, 378 (2007).

While the burden is on the moving party to demonstrate the absence of any genuine issue of material fact, Adickes v. S.H. Kress & Co., 398 U.S. 144, 157 (1970), a "mere scintilla of proof... will not suffice to prevent summary judgment." Peters v. Jenney, 327 F.3d 307, 314 (4th Cir. 2003). The non-moving party may not merely rest upon allegations or denials in pleadings but must, by affidavit or other evidentiary showing, set out specific facts showing a genuine issue remains for trial. Fed.R.Civ.P. 56(c)(1)(A). A court should enter summary judgment where a non-moving party fails to make a sufficient showing to establish the elements essential to the party's claim and on which the party will bear the burden of proof at trial. See Celotex, 477 U.S. at 322.

If there is insufficient evidence for a reasonable jury to render a verdict in favor of the non-moving party, there is no genuine issue of material fact, and summary judgment may be granted. See id. at 248. Summary judgment is inappropriate, however, if there exist factual issues "that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Anderson, 477 U.S. at 250; see JKC Holding Co. v. Washington Sports Ventures, Inc., 264 F.3d 459, 465 (4th Cir. 2001).


ELTG argues in its motion for summary judgment that it is not liable to the Renicks for negligent misrepresentation as a matter of law. ELTG also asserts the affirmative defenses of contributory negligence and assumption of the risk claiming the Renicks cannot recover damages even if ELTG were found liable.

A. Negligent Misrepresentation

To establish the claim of negligent misrepresentation under Maryland law, a plaintiff must show that: (1) the defendant, owing a duty of care to the plaintiff, negligently asserted a false statement; (2) the defendant intended that his statement would be acted upon by the plaintiff; (3) the defendant had knowledge that the plaintiff would probably rely on the statement, which, if erroneous, would cause loss or injury; (4) the plaintiff, justifiably, acted in reliance on the statement; and (5) the plaintiff ...

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