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Mario Umbelina and Tabatha Umbelina, H/W v. Jack Adams

November 30, 2011

MARIO UMBELINA AND TABATHA UMBELINA, H/W, APPELLANTS
v.
JACK ADAMS, INDIVIDUALLY, JACK ADAMS BUILDERS, LLC AND ADAMS & BREAM BUILDERS, LLC, APPELLEES MARIO UMBELINA AND TABATHA UMBELINA, H/W, APPELLANTS
v.
JACK ADAMS, INDIVIDUALLY, JACK ADAMS BUILDERS, LLC, APPELLEES



Appeal from the Judgment Entered March 4, 2011 In the Court of Common Pleas of Cumberland County Civil Division at No(s): 08-4393

The opinion of the court was delivered by: Stevens, P.J.

IN THE SUPERIOR COURT OF PENNSYLVANIA

Appeal from the Judgment Entered March 4, 2011 In the Court of Common Pleas of Cumberland County Civil Division at No(s): 08-4393

BEFORE: STEVENS, P.J., BENDER, and PANELLA, JJ.

OPINION BY STEVENS, P.J.:

This is an appeal from the order of the Court of Common Pleas of Cumberland County denying Appellants Mario and Tabitha Umbelina's request for equitable rescission of the contract providing for the construction of their home. After careful review, we affirm the trial court's denial of the Umbelinas' request for rescission and are constrained to vacate the trial court's award of restitution to the Umbelinas.

The Umbelinas, who are husband and wife, sought to purchase real property in the Jefferson Court Development in South Middleton Township, Pennsylvania in May 2005. Mrs. Umbelina informed their real estate agent that she needed a home with relatively flat terrain as she suffered chronic knee pain that limited her mobility. Although the Umbelinas considered several lots, they focused on Lot 17, which had a substantial incline in its natural state. Despite their desire for a lot with flat terrain, the Umbelinas decided to purchase Lot 17 for its size, price, and its unobstructed view of the valley due to its elevation.

The Umbelinas met with Jack Adams of Jack Adams Builders, LLC (Appellee) who was the approved builder for Lot 17. Mrs. Umbelina did not inform Adams that the home would need any special accommodations for her knee problems. The Umbelinas selected a two-story home plan because it would be less expensive than building a one-floor ranch home. Adams subsequently submitted a construction proposal that the Umbelinas accepted after reviewing it with their attorney. The construction agreement was executed on October 15, 2005.

After closing on the property, the Umbelinas met with Adams to discuss the location of the house on the lot. Adams staked out the house's approximate location in accordance with the lot's setback restrictions and informed the Umbelinas that the trees at the back of Lot 17 could not be removed due to restrictions the township placed on the subdivision. In order to lessen the steepness of the driveway, Adams asked the Umbelinas to move the home back an additional twenty feet from the proposed location. The Umbelinas only gave Adams permission to move the house back twelve feet as they wanted space to install a swimming pool in the backyard.

Before beginning construction of the home, Adams showed Mrs. Umbelina the approximate location of the garage floor using a story pole and explained the house could not be relocated once the foundation was poured. Mrs. Umbelina approved this location. However, upon viewing the actual foundation once it was poured, Mrs. Umbelina expressed concern that the driveway would be too steep. Adams assured the Umbelinas that the lot would be graded and would meet township and county requirements.

Russell E. Yinger and Timothy Stout, the South Middleton Township residential building inspectors, were responsible for inspecting the construction before issuing the certificate of occupancy. Neither Yinger nor Stout realized that the property was subject to the township's steep slope ordinance, which required (1) a professional engineer to prepare a driveway profile and a statement addressing structural concerns created by the slope and (2) the township engineer to approve the submitted plans. Unaware that this ordinance existed, Yinger mistakenly issued a building permit for the house without requiring Adams to comply with any of the steep slope requirements. Upon completion of the home, Yinger issued the home's certificate of occupancy, which was an affirmative statement a builder can rely upon that the property meets all the applicable township codes.

Prior to closing, the Umbelinas conducted a final walkthrough of the home and prepared a "punch list" of the following items that had not been completed: unfinished painting, missing downspouts, correction of mud infiltration into the basement, exposed nails in the carpet, separation of the stairs leading to the second floor, unsecured countertops, dishwasher cabinet not meeting the floor, and unsealed wires and pipes. Despite the numerous items on the punch list, the Umbelinas stated that they loved the house and did not raise any objections to the steep driveway. The Umbelinas closed on the property on June 30, 2006.

After Adams did not complete the items on the punch list and the Umbelinas found more problems in their home, the Umbelinas met with Yinger and Stout, who discovered the driveway violated township codes. When the Umbelinas confronted Adams about the code violations, he responded that the home was issued a certificate of occupancy, but apologized "for not building [the] house to what [the Umbelinas] needed, and [admitted] he did not have the experience to build the house [the Umbelinas] required." N.T., 6/21/10, 114. The Umbelinas prohibited Adams from returning to their home to address the uncompleted work and hired other contractors to (1) install a retaining wall to prevent mud infiltration in the basement, (2) install gutters, (3) replace wet drywall, (4) replace insulation in the house and garage, and (5) construct yard terraces. On September 26, 2006, the Umbelinas filed a consumer protection complaint against Adams Builders with the state Attorney General's office.

On June 21, 2007, the Umbelinas filed a lawsuit against Adams and Bream Builders, LLC, and Adams individually, seeking damages for breach of contract, requesting rescission of the agreement of sale, and alleging violations of the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL). Adams and Bream Builders, LLC denied having any involvement with the construction of the Umbelinas' home. The Umbelinas did not take any further action until July 22, 2008, when they filed a second lawsuit against Jack Adams Builders. The trial court consolidated the two actions for trial.*fn1 After a pretrial conference, the Umbelinas stipulated that it was inconsistent to seek both damages at law and rescission of the contract. As a result, the Umbelinas elected to proceed with their action in equity and limited their claims to rescission of the contract and the UTPCPL violations. The trial court subsequently dismissed their action at law with prejudice.

From June 21, 2010 to June 23, 2010, a trial court sat as factfinder in a bench trial and visited the site of the Umbelinas' home to view the slope of the driveway. The Umbelinas presented the expert testimony of Gregory Rogalski, a registered professional engineer, who testified that the driveway violates South Middleton Township's Zoning Ordinance Section 1807, which requires driveways not to exceed a seven percent slope within the first twelve feet from the street. The overall slope of the Umbelina's driveway is eighteen percent, however, the slope in the first nine feet of the driveway is only 0.8% over the seven percent threshold. Rogalski opined that it would impractical to attempt to remediate the slope of the driveway by lowering the garage or moving the house back further onto the lot.

In addition to the driveway violation, Rogalski found several other violations and problems within the Umbelina home. He shared that the home did not have anchor straps between the framing and the foundation which makes the house susceptible to lifting up during a windstorm and violates International Residential Code Section 403.1.5. Rogalski also observed significant cracks in the foundation wall, resulting in groundwater leakage into the basement. He indicated the first floor walls above the cracked foundation have moved as he noticed that the countertops, cabinets, and flooring have separated and the drywall has cracked. He also noted the home's insulation was improperly installed which would allow a fire to spread more rapidly through the home. Lastly, Rogalski testified that non-pressure treated wood was in direct contact with the foundation and opined that moisture from the concrete could decay this wood, resulting in additional structural problems.

Upon conclusion of the trial, the trial court found that the Umbelinas were not entitled to rescind the contract as Adams Builders had made no fraudulent misrepresentations concerning the slope of the finished driveway, his experience in constructing homes, or his honest belief that the home contained no code violations. For the same reasons, the trial court refused to find that Adams Builders had violated the state unfair practice statute.

However, the trial court found Adams Builders failed to construct a home of reasonable workmanship and value. Although the Umbelinas never raised a claim of breach of the implied warranty of habitability in their complaint and had abandoned their claims of breach of express and implied warranties with respect to the slope of the driveway, the trial court nonetheless found Adams Builders had breached the implied warranty of habitability as the home was not "functional and habitable in accordance with contemporary community standards." Trial Court Opinion (T.C.O.), 12/2/10, at 30. The trial court awarded the Umbelinas $26,036.68 in restitution for improvements the Umbelinas made to remedy Adams's faulty construction. Both parties filed timely motions for post-trial relief. After reviewing the ...


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