Oltmer v. Zamora

Appellate Court of Illinois
418 N.E.2d 506, 94 Ill. App. 3d 651 (1981)

ELI5:

Rule of Law:

A statement of opinion can be considered an actionable misrepresentation of fact if it implies the existence of undisclosed facts that justify the opinion, particularly when the speaker holds themselves out as having superior knowledge or has an undisclosed adverse interest.

Facts:

William K. Oltmer and Bonnie J. Oltmer, who were new to the Decatur area, contacted Ed Drobisch & Co., Realtors to help them find a home.
The firm assigned agent Juanita Jones, who was the undisclosed aunt of Elaine M. Zamora, the seller of one of the properties.
Jones told the Oltmers that the builder of the Zamora house, Joseph B. Zamora, was a 'very reputable' builder and 'one of the best in the area'.
In reality, Joseph B. Zamora had never built any type of structure before constructing this house.
During a tour, William Oltmer commented that he felt like he was 'walking uphill,' but Jones dismissed his concern, stating that could not be so because the house was new.
The Oltmers purchased the house and later discovered it was built on a severe slope, with one side being 13 to 15 inches higher than the other.
After the defect was confirmed, Jones suggested to the Oltmers that they attempt to sell the house and implied they should do so without informing potential buyers of the problem.

Procedural Posture:

William and Bonnie Oltmer (plaintiffs) sued Joseph and Elaine Zamora, Ed Drobisch & Co., Realtors, and Juanita Jones (defendants) in the circuit court of Macon County.
On Count I against the Zamoras, a jury returned a verdict for the plaintiffs for $7,500.
On Counts II and III for misrepresentation against Drobisch & Co. and Jones, the jury was unable to agree on a verdict.
After the jury was discharged, the trial court entered a judgment in favor of defendants Drobisch & Co. and Jones, notwithstanding the jury's failure to agree.
The Oltmers (appellants) appealed the trial court's judgment on Counts II and III to the Illinois Appellate Court.

Premium Content

Subscribe to Lexplug to view the complete brief

You're viewing a preview with Rule of Law, Facts, and Procedural Posture

Issue:

Does a real estate agent's statement of opinion that a builder is 'very reputable' and 'one of the best' constitute an actionable misrepresentation of fact when the agent has an undisclosed familial relationship with the seller and knows the builder has no prior experience?

Opinions:

Majority - Mr. Justice Green

Yes. A statement of opinion can constitute an actionable misrepresentation of fact under these circumstances. The court reasoned that an expression of opinion can carry with it an implied assertion that the speaker knows of facts that justify it and knows of no facts that would preclude it. This is especially true where the speaker, like a real estate agent, holds themselves out as having special knowledge unavailable to the plaintiff. Citing the Restatement (Second) of Torts §539, the court found that a jury could reasonably interpret Jones's opinion about the builder's reputation as an implied statement of fact because she was an expert and had an undisclosed adverse interest (her relationship to the seller). Given that she knew the builder had no experience, her statements could be found by a jury to be a fraudulent misrepresentation made with culpable ignorance of their truth or falsity, and the circumstantial evidence supported this conclusion.

Analysis:

This decision blurs the traditional line between non-actionable opinion or 'puffery' and actionable misrepresentation of fact. It establishes that a speaker's professional status and potential conflicts of interest are critical in determining how their statements will be legally interpreted. The ruling puts professionals, such as real estate agents, on notice that their opinions can create legal liability if they imply a factual basis that is untrue, particularly when they possess superior knowledge or an undisclosed adverse interest. This broadens the scope of potential fraud claims, allowing juries to look behind the form of a statement to its substance and the context in which it was made.

Gunnerbot

AI-powered case assistant

Loaded: Oltmer v. Zamora (1981)

Try: "What was the holding?" or "Explain the dissent"