Wilson v. Century 21 Great Western Realty – Case Brief Summary (California)

In Wilson v. Century 21 Great Western Realty (1993) 15 Cal.App.4th 298, Division Two of the First District Court of Appeal upheld a grant of a nonsuit on a negligent misrepresentation cause of action in a real estate case because the alleged negligent misrepresentation was not a positive assertion of fact. The court explained:

"Negligent misrepresentation is a species of fraud or deceit specifically requiring a 'positive assertion' or 'assertion' of fact. An 'implied' assertion or representation is not enough. " (Id. at p. 306.)

Applying these principles, the Wilson court held that the sellers' representation in a disclosure statement that they were "not 'aware' of significant 'defects/malfunctions' " in the home's foundation could not support a negligent misrepresentation claim because a positive assertion of fact was required. (Wilson, supra, 15 Cal.App.4th at p. 306.)

This was true even though there was evidence the sellers' real estate agent had a brief conversation with the sellers' next door neighbor, who suggested that the property might have foundation problems. (Id. at p. 303.)

The court observed: "Asserting that one is not 'aware' of significant 'defects/malfunctions' in a foundation, while a direct reference to a foundation, is still only implied as to its true condition. Indeed, one who claims to be 'aware' of no defects necessarily leaves open the chance that unknown defects do exist." (Id. at p. 306.)

Thus, the lack of a positive assertion defeated the buyer's claim of negligent misrepresentation. (Id. at pp. 306-307.)