Opposition Brief — Craig v. Basheer & Edgemoore

a civil case, but rather, the South Carolina Supreme

Court's retroactive construction of a crimina! statute

which violated the constitutional requirement of

definiteness, and the underlying principle that a person of

ordinary intelligence should be given fair notice that the

contemplated conduct was forbidden by statute made it

criminal to enter onto property after being given fair

netice prohibiting the entry. The Supreme Court

interpreted a trespass statute to apply to both entry onto

land and remaining on the property. It was this

reinterpretation which violated a criminal due process

right, and was the subject of the Supreme Court's

decision. In the case at bar, there is no allegation of a

change in the interpretation of a criminal statute which

would deprive the Petitioners of their due process rights.

The Petitioners also cite Adams v. Robertson, 520

U.S. 83 (1997) for the proposition that this Court could

consider an appeal from a state court decision when there

was a failure to raise a Federal question before the

Alabama Supreme Court. In Adams the Court held that

since the Petitioners failed to establish that they properly

presented the alleged violation of the Fourteenth

Amendment due process clause to the Alabama Supreme

Court, the United States Supreme Court would not reach

the issue presented, and dismissed the Writ of Certiorari

as improvidently granted. When the state's highest court

is silent on a Federal question, it is assumed that the issue

was not properly presented. /d. at 86. The only

exception is when the aggrieved party establishes that

the state court had a “fair opportunity to address the

Federal question that is sought to be presented” to the

United States Supreme Court. Webb v. Webb, 451 U.S.

493, 501 (1981). The Virginia Supreme Court was silent

on any Federal question. The Petitioners have not

attempted to overcome the presumption that the Federal

10

question was not presented to the Virginia Supreme

Court.

None of the cases cited by the Petitioners support

a finding of jurisdiction merely because of a varied

interpretation of a rule of law by a state’s highest court.

For example, in Bush v. Gore, 531 U.S. 98, 115 (2000),

(Renquist, CJ concurring) the opinion did not consider

whether or not the United States Supreme Court had

jurisdiction under 28 U.S.C. § 1257. In Wright v. Georgia,

373 U.S. 284, 289-291 (1963), the alleged violation of the

Fourteenth Amendment was presented at the trial court

and before the Georgia Supreme Court. In N.A.A.C.P. v.

Alabama, 357 U.S. 449, 457-458 (1958), the Federal

questions had been raised to the Supreme Court of

Alabama. In United States v. Lanier, 520, U.S. 259, 266

(1997), the question was presented as to whether there

was a violation of 18 U.S.C. § 242 for criminally violating

the constitutional rights of five women by assaulting

them sexually while the respondent served as a state

judge. The question before the Court was whether or not

there was fair warning or notice of what the law intended.

No issue was raised as to the Court's jurisdiction to

decide Federal questions. Finally, in Marks v. United

States, 430 U.S. 188, 191-192 (1977), there was an appeal

of a conviction of the transporting obscene materials in

violation of Federal law, and a question of the retroactive

application of a new standard for defining pornography.

Again, there was no question raised as to whether or not

the Court had jurisdiction under 28 U.S.C. § 1257.

Cc. The Doctrine Of Partnership By Estoppel

Or Implied Partnership Is Not Applicable

To Tort Actions.

The Petitioners argue that the trial Court and the

ll

Virginia Supreme Court should have considered the

existence of a partnership by estoppel in the Petitioners’

effort to hold additional entities liable on the contract

claims and other claims. In Virginia, the existence of a

partnership by estoppel is controlled by Va. Code § 50-

73.98:

y

If a person, by words or conduct, purports to

be a partner, or consents to being

represented by another as a partner, in a

partnership or with one or more persons not

partners, the purported partner is liable toa

person to whom the representation is made, if

that person, relying on the representation,

enters into a transaction with the actual or

purported partnership. If the representation,

either by the purported partner or by a

person with the purported person's consent,

is made in a public manner, the purported

partner is liable to a person who relies upon

the purported partnership even if the

purported partner is not aware of being held

out as a partner to the claimant. If

partnership liability results, the purported

partner is liable with respect to that liability

as if the purported partner were a partner. If

no partnership liability results, the purported

partner is liable with respect to that liability

jointly and severally with any other person

consenting to the representation.” (emphasis

added.)

The statute is an adaptation of the common law, which

also provided that parties are estopped from denying a

partnership where they hold themselves out as partners

12

and a third party reasonably relies on the representations

to its detriment. “In order for the third person to be

liable as a partner on the ground of estoppel, two things

must be proven: (1) the act of holding out must have been

done either by him or with his consent; and (2) such

holding out must have been known to the party seeking to

avail himself of it and credit given on the faith of it.”

Hobbs v. Bank, 147 Va. 802, 841, 128 S.E. 2d 46 (1926);

Cooper v. Knox, 197 Va. 602, 607, 90 S.E. 2d 844 (1956).

The concept of partnership by estoppel requires an

element of reliance, and there can be no reliance in the

existence of a partnership for tort based allegations.

“The only theory under which a person who is not

a partner in a partnership with other persons can

be held liable as a partner with others to a third

person is on the basis of estoppel, although this

principle of law can only be relied upon by third

parties, by his own conduct, the person who is not

a partner represents himself or allows himself to

be represented to a third person as being a

partner, and the third party relying on such

representation of conduct gives credit to the

supposed partnership... This doctrine of estoppel

in_such cases is not applicable to purely tort

actions, because the third party in such cases is not

injured as a result of any conduct on the part of

the person he is attempting to hold as a partner in

connection with a negligent act on the part of

another person or persons. It can only be used in

connection with a contract or where credit is given

in reliance on such conduct...”

(citations omitted. |

Pruitt v. Fetty, 148 W. Va. 275, 279-280, 134 S.E. 2d 713,

13

716-171 (1964). ‘

Even if the Court were to find a partnership by

estoppel, Diane Cox Basheer Communities, Inc. would

only be liable for the breach of contract and warranty

claims, which have now been dismissed with prejudice.

The Petitioners cannot recover against the alleged

partnership, when the Court has entered a final judgment

against the alleged agent for the partnership. See Santen

v. Tuthill, 265 Va. 492, 578 S.E. 2d 788 (2003); Roughton

Pontiac Corp. v. Alston, 236 Va. 372 S.E. 2d 147 (1988).

The only “partnership” that was alleged did not

include the named seller on the contract. When asked by

the tria! court the allegations a partnership existed,

Petitioners’ counsel pointed to Exhibit B to the Amended

Motion for Judgment. (Tr. p. 15). The seller is not one of

the entities identified in the exhibit as a “partner”. Even

if a partnership existed, the “partnership” was not part of

the sale.

D. The Petitioners Fail To State Any Cause Of

Action Against Defendant Diane Cox Basheer

Communities, Inc.

A Demurrer will be sustained by the Court if a

plaintiff fails to sufficiently plead a cause of action against

a defendant, when all properly pled facts are taken as

true. Wards Equipment, Inc., et.al. v. New Holland

North America, Inc,, 254 Va. 379, 382, 493 S.E. 2d 516,

518 (1997). In considering a demurrer, a court will draw

all inferences from the facts alleged in favor of the non-

moving party, but “a demurrer does not admit the

correctness of the pleader’s conclusions of law.” Id.

Petitioners must allege facts sufficient to state a case of

action. Va. Code § 8.01-273. The record makes it clear

that the Court only looked at the allegations in the

14

Amended Motion for Judgment, and the exhibits thereto.

Despite the fact that the agreement entered into

by the Petitioners states on its face that it is with

Basheer/Edgemoore-Southampton, L.L.C., the

Petitioners attempt to impose liability against Diane Cox

Basheer Communities, Inc. by arguing that the two

entities are members of a general partnership doing

business under the trade name “Basheer & Edgemoore.”

Although Diane Cox Basheer Communities, Inc. is not

mentioned or identified anywhere in the agreement

signed by the Petitioners, the Petitioners allege that the

partnership exists because the entities allegedly hold

themselves out to be a general partnership “in

advertising, marketing, construction, sharing of

employees, sharing of contractor licenses, and prolific use

of the trade name ‘Basheer & Edgemoore’.” (Amended

Motion for Judgment, { 7). Petitioners’ specific

allegations related to documents reviewed after the

contract was signed.’ The Petitioners cannot now claim

reliance on the existence of a partnership they learned

about after the contract was signed.

The contract was for the sale of the property, was

fully endorsed by the Petitioners, and explicitly states in

the first paragraph that the contracting party is “Basheer,

Edgemoore- Southampton, L.L.C.” A limited liability

company in Virginia is an identifiable entity, and its

liabilities and composition are determined by statute.

The Petitioners attempt now to impose liability against a

“partnership” in the face of clear and unambiguous

language to the contrary in the contract. Factual

allegations in pleadings must be disregarded if they “are

*Compare the contract dated May 20, 2000, with the letter allegedly

showing a partnership dated four days later on May 24, 2000.

15

refuted by the terms of the authentic, unambiguous

documents that are a part of the pleadings.” Ward’

Equipment, Inc. et al. v. New Holland North American,

Inc., 254 Va. 379, 384, 493 S.E.2d 516, 519 (1997). The

sales contract was attached to the motion for judgment as

Exhibit 1, and any allegations made by the plaintiff that a

partnership, or any _ entity other _ than

Basheer/Edgemoore- Southampton, L.L.C., was liable on

the contract were refuted by the contract, and should not

be considered. Any documentation or statements made

after the contract was entered into by the Petitioners are

irrelevant. The Petitioners were aware at the time of

contracting that they were purchasing a home from one

entity only; that is, Basheer/Edgemocre- Southampton,

L.L.C.. The Petitioners may not now attempt to change

the clear wording of the contract to impose liability on

uninvolved entities.

There can be no reliance, as a matter of law, on

alleged misrepresentations concerning the identity of a

party to the contact, when the contract expressly

identifies the parties. In Board of Directors of Carrdinal

Place Condominium v. R. Carr Homes Partnership,

et.al., 58 Va. Cir. 602 (2000), Judge Alden of the Fairfax

Circuit Court held that as a matter of law, in granting a

Motion for Summary Judgment, the plaintiff did not

allege misrepresentations as to the identity of the seller,

when the seller was identified in the contract. There

could be no reliance on any misrepresentations or

statements prior. Likewise, there could be no reliance by

the Petitioners here that they entered into a contract

with a non-existent partnership not identified in the

contract.

The Virginia Supreme Court has held that the

term “partnership” itself is not sufficient to establish a

legal partnership or to impose the liabilities of a partner

16

on a second party. In Kennedy v. Mullins, 155 Va. 166,

154 S.E. 568 (1930), the Supreme Court of Virginia stated

that “if the terms of the contract existing between the

parties do not constitute a partnership, none will be

declared, even though the parties in words call the

arrangement one.” /d. at 173,570. Under this precedent,

the fact that correspondence provided to the Petitioners

states in general terms that “Basheer & Edgemoore” is a

partnership with Diane Cox Basheer Communities, Inc.

and Edgemoore Homes is insufficient to impose liability

against Diane Cox Basheer Communities, Inc.

The Petitioners have not alleged that Diane Cox

Basheer Communities, Inc. nor any other entity have

joined together “their money, goods, labor, or skill in a

venture or business, upon an agreement to divide the

gains or losses between them. “ Cooper v. Knox , 197 Va.

602, 607, 90 S.E. 2d 844, 847 (1956). The Court is not

required to accept general legal conclusions pled by a

plaintiff in a motion for judgment. As such, the

Petitioners have not established sufficient factual

allegations to support a finding of a general partnership

between Diane Cox Basheer Communities, Inc. and the

entity that entered into the contract with the Petitioners

for the sale of their home. As there are no direct

allegations against Diane Cox Basheer Communities, Inc.

for any acts taken by that entity, and the Petitioners have

not established sufficient factual support to allege liability

based on a partnership, all counts against Diane Cox

Basheer Communities, Inc. were properly dismissed.

17

E. The Petitioners have not Appealed the Court's

Rulings on Fraud that are not Based on the

Merger Clause

Before the Virginia Supreme Court, the

Petitioners focused their argument on the trial Court’s

ruling on the merger clause. They have ignored the

Court's ruling on the other bases for why the claims for

fraud were dismissed, and have not challenged those

rulings before the Court.

In Counts III through V, the Petitioners claim

actions based on fraudulent inducement, actual fraud and

constructive fraud. In these allegations Diane Cox

Basheer Communities, Inc. is not specifically named.

Counts IV and V are based solely on the

allegations that there was a failure to install a radon

mitigation system as required under the contract. The

allegations in Counts IV and V arise solely from the

breach of contract and cannot support an action in tort.

Richmond Metropolitan Authority v. McDevitt Street

Bovis, Inc., 256 Va. 553, 558, 507 S.E. 2d 344, 347 (1998).

Here, the trial court correctly found that many of

the alleged allegations of fraud did not involve present

statements of fact, but rather involved future

transactions. For example, the Petitioners sued for

failure to build the house of the same quality as the

model, (Amended Motion for Judgment, 4 81), and

because the yard would not be flat. Both reference

future activities. The Petitioners then allege that there

were misrepresentations concerning character, style,

quality and grades. The Court correctly held that these

statements as to quality were not actionable. See Tate v.

Colony House Builders, Inc., 257 Va. 78, 508 S.E. 2d 597

(1999). (statements that a new dwelling house was

competently designed, commensurate with the price, and

18

that the design of the construction was of the highest

quality were puffery and opinion and could not form the

basis for an action for constructive fraud). Similarly, the

Court’s findings that representations of the parties’ rights.

and legal obligations, such as whether or not the contract

could be repudiated, or the parties’ rights under a

warranty, are statements of law, and cannot form the

basis for a claim for fraud. See Giovanni Mortarino v.

Consulting Engineering Services, 251 Va. 289, 467 S.E. 2d

778 (1996) (fraud cannot be predicated on statements of

opinion, and must relate to pre-existing facts, and not

unfulfilled promises or statements as to future events.)

In addition to their allegations concerning future

contractual obligations, the Court found that the merger

clause would apply to these allegations of fraud, and as a

result of the application of the merger clause, no liability

could be imposed. The Petitioners have not cited any

binding authority that the merger clause should not apply

to the facts of this case. Even without the merger clause,

there could be no claim. Breaches of future promises, or

contractual based obligations do not state claims.

Metropolitan Authority v. McDevitt Street Bovis, 256 Va.

553, 507 S.E. 2d 344 (1998).

Petitioners have not challenged the Court’s rulings

concerning Counts IV (Actual Fraud) and V

(Constructive Fraud). These Counts concern the alleged

misrepresentations that a radon remediation system was

installed. The duty to install such a system arose out of

the duties created by the contract. Where the

misrepresentation concerns a duty created by contract,

the remedy is a claim for beach of contract, not fraud. “A

tort action cannot be based solely on negligent breach of

contract.”Richmond Metropolitan Authority v. McDevitt

Street Bovis, 256 Va. 553, 559 307 S.E. 2d 344 (1998).

The decision by the Trial Court was well grounded,

19

based on Virginia law and precedence. The decision by

the Virginia Supreme Court refusing to grant the

Petition for Appeal was also well supported by Virginia

law. Even if the Petitioners are correct, and the Virginia

Supreme Court changed its rule concerning the creation

of a partnership by estoppel, that finding does not allow

the Petitioners to proceed. The underlying torts, upon

which vicarious liability is sought to be imposed have not

been challenged on appeal. Simply finding a partnership

would provide no relief, since there is no valid claim

against any of the partners at this time. Those claims

have all been dismissed.

CONCLUSION

For the above reasons, the Petition for Writ of

Certiorari should be denied.

Respectfully submitted,

Kenneth S. Mahieu, Stephen A. Horvath

MATSON FREYVOGEL Counsel of Record

8200 Greensboro Drive TRICHILO,

Suite 425 BANCROFT, McGAVIN,

McLean, Virginia 22102 HORVATH & JUDKINS,

(703) 448-6600 P.C.

3920 University Drive

Fairfax, Virginia 22030

Telephone: (703) 385-1000

Facsimile: (703) 385-1555

Attorneys for Respondent

Diane Cox Basheer Communities, Inc.

IN THE

Supreme Court of the United States

STEPHEN V. CRAIG AND UN SUN H. CRAIG, PETITIONERS

v.

DIANE COX BASHEER COMMUNITIES, INC.; EDGEMOORE

HOMES, LLC; BASHEER/EDGEMOORE-SOUTHAMPTON,

LLC; BASHEER/EDGEMOORE-WESTHAMPTON, LLC;

AND BASHEER & EDGEMOORE, A VIRGINIA GENERAL

PARTNERSHIP,

PETITION FOR A WRIT OF CERTIORARI

TO THE SUPREME COURT OF VIRGINIA

PETITION FOR REHEARING

Stephen V. Craig, Pro se

Un Sun H. Craig, Pro se

7545 Laurel Creek Lane

Springfield, VA 22150-4908

(703) 866-4543

Gueey & TAYLOR © WAGH O.C. @ (202) 223-3160 * UBSCINF o.com

QUESTION PRESENTED

Did the Virginia state courts deny the petitioners due

process of law when they unexpectedly and without fair

warming repudiated the petitioners’ claims that the

respondents, acting in concert, committed fraud and violated

the Virginia Consumer Protection Act in the marketing,

selling and building of the petitioners’ home’?

TABLE OF CONTENTS

QUESTION PRESENTED ......

TABLE OF AUTHORITIES

OPINIONS BELOW

JURISDICTION

RELEVANT PROVISIONS INVOLVED

STATEMENT

ARGUMENT

CONCLUSION

CERTIFICATION

APPENDIX (See Lodging)

Nw

TABLE OF AUTHORITIES

(Cases

Bair Const., INC. V. WEATHERFORD, 485 S.E.2p 137,

ES EE IN Lt BOSE ESS ae 8

Boure Vv. Crry or Cottuma|ta, 378 US. 347, 35441964) ........ 7

CONTRAST KUC/MANSKI V. Gitt.. 302 S.F.2p 48, 5001983)... 8

GeorGct. ROBBERECHT SEAFOOD V. MATILAND Bros. 255

NEE EE ROE AE a PE Ze &.9

LARCHMONT PROPERTIES V. CoOPERMAN, 80 S.E.20) 733.

Se a i a ee ee 8.9

Lioyp Vv. Swi, 142 8. E.2p 363, 365 (1928).........0 8

MILLER V. REYNOLDS, 223 S.E.2p 883, 885(1976)............. 8.9

MORTARINO V. CONSUL1T-ANT ENG'G SERVS.. 467 S.E.2b 778,

A A YO CT Ne) SP RE 7.8

Nic V. KOONS Buick PoNntriac GMC, Inc... 143 F. Supe. 535.

ky Te a ee os BS )

PACKARD NorRrork. INC. Vv. Miter, 95 S.1.2p 207,

ri) |, Se Oe x

PATRICK V. SUMMERS. 369 S.F.2p 162. 164(¢1988)............... 7

SAXBY V. Sou THERN LAND Co.. 63 S.E. 473, 424(1909)...... 7

Soa_e Vv. HeRMAn, 9 S.b.20 459, 464(1940).......... ATE ERIE

iv

SPENCE V. GRIFFIN, 372 S.E.2D $95, 599( 1988)... cece 10

STEVENS V. CLINTWOOD DruG Co., 154 S.E. 515, 518(1930)

PRN SR NS ot ER eee MALE) OMe Ra Mee

TATE V. COLONY HOUSE BuILDERS, 508 S.E.2p 597, 599-601

VCPA. LAMBERT V. DOWNTOWN GARAGE, INC.. 553 S.E.2p

iS SR ce et 10

Warp's Eourp. v. NEW HOLLAND Nortit AM., 493 S.E.2p

$16, 5SI8(VA.1997)...... ES BS. Pan eB OA wow Eee. 5

WILKINS V. PENINSULA MoTror CARs, INC.. 587 S.E.2p S581.

_ + ARR RCSA AB a Opel SO al Pe oe AEP eer Nes )

Statutes

E:xpress Warranty and, the Virginia Consumer Protection Act

(Va. Code Sections 59. | -196 ..........cccccccccsccsssocccssscoeseeees 4.9

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Vitae COGS Best SO> TIPO vccccsccccscscssccesessosncosensccscecesesens 3

Viggen Code Section 59. 1-196. ..ccccsccesscovssescecesvseseevcrsesessesees |

Viegeeta Code Section 59. 1-200. .ccsccoscscsccsevcscccvccvvessccscevessoces |

L

OPINIONS BELOW

The relevant Opinions and Orders are contained in the

petitioners’ original petition for certiorari. the denial of which

is the subject of this Petition for Rehearing.

JURISDICTION

The Court denied the petitioners’ original petition for

certiorari on February 21. 2006. This petition for rehearing is

filed within 25 days of this Court's denial of the petition for

certiorari consistent with the provisions of Supreme Court

Rule 44.2.

RELEVANT PROVISIONS INVOLVED

United States Constitution, Amendment XIV, Section

...No state shall make or enforce any law which shall

abridge the privileges or imraunitics of citizens of the

United States: nor shall ary siate deprive any person

of life. liberty, or property, without due process of

law...

Virginia Code Section $9.1-198:

“(Consumer transaction” means:

1. The advertisement, sale. lease. license of offering

for sale. lease or license, of goods or services to be

used primarily for personal. family or household

purposes.

“Cioods” means all real. personal or mixed property.

tangible or intangible...

Virginia Code Section 59.1-200:

Prohibited = Practices.-----A. The = following

2

fraudulent acts or practices committed by a supplier in

connection with a consumer transaction are hereby

declared unlawful:

|. Misrepresenting goods or services as those of

another,

2. Misrepresenting the source, sponsorship, approval,

or certification of goods and services;

8. Advertising goods or services with intent not to sell

them as advertised...

14. Using any other deception, fraud, false pretenses,

false promise. or misrepresentation in connection with

STATEMENT

The facts and procedural history of this case are set out in the

petitioners’ original petition for writ of certiorari, the denial

of which is the subject of this Petition for Rehearing.

ARGUMENT

The Virginia State Courts Denied The Petitioners

Due Process Of Law When They Unexpectedly And

Without Fair Warning Repudiated The Petitioners’

Claims That The Respondents, -cting In Concert, In

Breach of Express Warranty, Committed Frauds, And

Violated The Virginia Consumer Protection Act In The

Marketing, Selling And Building Of The Petitioners’

Hiome.

The petitioners request rehearing of the denial of their

petition for writ of certiorari (PWC) pursuant to Supreme

Court Rule 44.2. This request is made because in their

original petition. the petitioners for the sake of brevity.

3

focused only on the Virginia state courts’ inexplicable and

unexpected repudiation of Virginia Code Section 50-73.98's

language recognizing the liability of a partnership created by

estoppel as denying them due process of law.

However, left unaddressed by the petitioners’ original

petition for writ of certiorari was their further claim that the

Virginia state courts’ denied them due process of law when

they inexplicably and without fair warning ruled that none of

the respondents, while furthering the partnership business,

could be held liable for their Breach of Express Warranty and

violations of the Virginia Consumer Protection Act, and/or

for their fraudulent, actual, and/or constructive fraud when

they fraudulently. willfully. and/or intentionally misled the

petitioners about the cost of house (App. 1a) and the quality

and workmanship of their home, then failed delivering the

quality of home the petitioners paid for (APP.10a-15a) and

failed to install the Radon mitigation system as promised

(App.S5a&5b), affirmatively concealing this fact (App.19-

20;:58-60) from the petitioners knowing how harmful this

may be to any human beings.

B&E also intentionally made misleading statements that

petitioners could not repudiate the agreement after certain

lots were made unavailable to them or when certain models

could not be built; that their lot would be flat and private

when in fact it was sloped and lacked privacy

(App. 16a&17a): that utility lines would be buried when in

fact they were installed above ground; that 1 operated

without a contractor's license (App. 28-30), when it

prematurely delivered the home to the petitioners two months

before it was finished (App. 37).

The petitioners believe that the zbove claims are

important enough to warrant the grant of their Petition

for Rehearing, not just only for them but for other

consumers similarly situated and may make transactions for

construction of their homes, rely on the partnership and other

advertisements made by B&LE: to the public (App. 6a-8a). like

the petitioners.

4

The petitioners paid at least $115,833 more because the

B&E operated the business without license in the public and

the B&E gave incorrect cost to the petitioners. The

petitioners actually signed to the contract to purchase a used

(less than one year old) B&L Ashmont model (the

Alternative) from the home owner for $500,000 on 9 May

2000 (APP. 16a) but offered the price reduction to $495,000

(APP. 3&4) when the petitioners withdrew their contract to

purchase their home from B&E. B&LE also provided incorrect

cost to at least one of their neighbors. The petitioners signed

B&E’s contract on 20 May 2000.

In the first place, the petitioners alleged that the Virginia

general partnership known as the respondent Basheer and

Edgemoore (“B&E”) advertised and marketed itself and its

four other respondent partners as specialists in the

construction, sales and financing of luxury residential homes

in suburban Virginia.. They asserted that B&F violated the

Express Warranty and, the Virginia Consumer Protection Act

(Va. Code Sections 59.1-196 ef seg.) when it intentionally

misrepresented the petitioners’ rights under the llome

Warranty. refused to perform work called for thereunder.

required the petitioners to waive their rights under the

Warranty, refused to repair the petitioners’ listing of defects,

and refused to conduct a final walk-through inspection

without insisting on @ waiver of petitioners’ rights(App. 18-

19:62). The result was a Home Warranty which had no value

Consistent with the Breach of Express Warranty. the

petitioners under Count | ask an award of damages against

B&E and other Defendants, except BAL/Southampton LLC

The petitioners dismissed the case against the LLC duc to

expenses that would occurring for expert witness and trial

including attorney's fee that may cost at least $15,000. but

the Warranty was not worth more than $1,000. and the 1.1.¢

has lack of resources, if any to repair defects, etc

Consistent with the Consumer Protection Act. the petitioners

under Count II asked for an award of damages to compensate

them for the difference in value between the home BA!

§

promised and the home it actually delivered and for the

money they spent in attempting repairs in order to put the

home in the condition BAF represented it would be in at the

time of closing{ App. 20-21). In addition, for each violation of

the Act, they sought an award of the greater of $1,000 or

three times their actual damages incurred together with their

attorney's fees and costs{ App. 21).

in Count Ill, the petitioners relied upon all of these

material misrepresentations by B&E to allege that but for

this fraud, BRE would not have been able to make the

sale( App. 21-24). They sought compensatory damages and

$350,000 in punitive damages from all the respondents for

this fraudulent inducement(App. 24). The petitioners further

claimed in Count 1V and V that all of the respondents

committed actual and/or constructive fraud when they failed

to install a Radon mitigation system as promised and then

concealed this fact from the petitioners with measured Radon

levels four times the maximum allowable safe levels as

established by the EPA(App. 24-28). As a result of B&L's

actual and/or constructive fraud. the petitioners have been

forced to live in a home with unsafe levels of Radon. were

denied the use and enjoyment of a substantial portion of their

home, sustained severe emotional and mental distress,

suffered monetary losses caused by installing a Radon

mitigation system themselves with Mrs. Craig suffering

physical injury in the course of making these repairs as well

as a precancerous growth requiring surgery and a noticeable

loss of hair(App. 26:28:57). They sought compensatory

damages in the amount of $500,000, punitive camages of

$350,000 and their costs. expenses and attorney's fees App.

26.28).

Desprie established law that upon demurrer such

alleyations are taken as true and read with every deference to

the petitioners. Ward's Fquip v New Holland North Am..

493 Sb2d $16. S18 Va.1997), the Virginia courts

inexplicably sustained the demurrers of the respondents to

Count Is allegations of violations of the Consumer

6

Protection Act because the petitioners’ allegations were not

specific enough, disregarding the petitioners’ two lettcrs

(App. |6a &17a) sent to the B&E identifying specific

defects, especially for yard slopes, also provided at least two

inspection reports performed by certified home inspectors

(App. 32a, PWC). The B&E and other respondents also

know the degree of code-violated yard slopes because they

spent over 30 minutes in the petitioners’ yards in the previous

day they made the hearing on the motion. In addition, they

ruled that paragraph 19's merger clause in the agreement bars

relief for fraud since the petitioners acknowledged therein

that they had not relied upon any other representations

outside of the contract. The petitioners were actually relied

on the B&E’s advertisements, their brochures, and their

correspondence before, during, and after signing of the

contract as stated above.

One of the brochures that B& E provided to the

petitioners before and was available during and afler the

signing of the contract states “Basheer & Edgemore is a

Partnership of Diane Cox Basheer Communities and

Edgemoore Slomes, offering over 40 years of experience ...

With over 5,000 homes...” (App. 6a-8a). At least three

letters and one of the envelopes that the B&E sent to the

petitioners also states as “A Partnership of Diane Cox

Basheer Communities And Edgemoore Homes” (App. 3a.

dh, Je).

As for the respondents’ actual and constructive fraud

claims under Counts IV and V, the Virginia courts ruled that

there was no causal connection between the alleged fraud

and the severe emotional and mental distress suffered by

Mrs. Craig in spite of the physical injury she sustained in the

course of making repairs. Mrs. Craig had severe allergic

reactions, a precancerous growth which required surgery. a

persistent cough for almost two years and a noticeable loss of

hair( App. 57) and other problems as stated the above.

In sustaining the demurrers. the Virginia courts have

employed an unforeseen reading of Virginia Consumer

J

Protection Act and their own decisions on fraud and

constructive fraud. This unfair reading of the petitioners’

complaint is “indefensible by reference to the law which had

been expressed prior to the conduct in issue.” Bouie v. City of

Columbia, 378 U.S. 347, 354(1964); and it is so far beyond

what a “lair reading” of the Virginia Consumer Protection

Act and the relevant decisional law would permit as to

constitute a denial of due process of law. /d. at 354-355.

The Fraud Counts. By its home models, advertisements,

correspondence and dealings with the petitioners, B&E in

order to make the sale promised the petitioners before and

after they executed the contract that their home would be

habitable, constructed in a workmanlike manner and free of

defects( App. 53-56:66). Instead, their home was none of

these things. It was unsafely and defectively built; it had

unsafe levels of Radon; and the petitioners have been denied

the use and enjoyment of a substantial portion of their home,

have sustained severe emotional and mental distress, have

suffered monetary losses caused by installing a Radon

mitigation system themselves with Mrs. Craig suffering

physical injury including a precancerous growth requiring

surgery and a noticeable loss of hair (App. 26;28:57-60;64-

65). The petitioners’ expense occurred over $156,149.35 for

attorneys’ fee, home inspection reports, printing jobs, and

filling fees for the Courts, not including repair costs that they

already paid and would occur to reccive justice.

(in Virginia, a misrepresentation, the falsity of which will

afford ground for an action for damages, must be of an

existing fact. and not the mere expression of opinion.

Mortarino v. Consult-ant Eng'g Servs, 467 SL2d 778,

781(1996). Saxby v. Southern Land Co., 63 S$... 423, 424

(1909). Additionally, “fraud must relate to a present or pre-

existing fact. and cannot ordinarily be predicated on

unfulfilled promises or statements as to future events.”

Patrick © Summers, 369 S.L2d- 162, 164(1988) quoting

Sohle v ddeeman, 9 SV2d 459, 464(1940). Llowever. when

B&L through its home models. advertisements, brochures,