ELEANOR D. COWLEY, APPELLANT,
v.
LARRY J. NERO, APPELLEE
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Eleanor Cowley purchased real property from Larry Nero and sued for fraudulent and negligent misrepresentation. After initially prevailing at trial, the trial court granted Nero's motion for rehearing and vacated the judgment based on the economic loss rule. The appellate court reversed, holding that fraudulent and negligent misrepresentation claims are independent torts not barred by the economic loss rule.
The economic loss rule does not bar tort actions for fraudulent and negligent misrepresentation in the formation of a contract, as these are independent torts requiring proof of facts separate and distinct from breach of contract.
[1] A tort action may lie for intentional or negligent acts considered to be independent from the acts that breached a contract.
[2] Fraudulent inducement is an independent tort requiring proof of facts separate and distinct from a breach of contract.
Previewing 2 of 3 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“Where a contract exists, a tort action will lie for either intentional or negligent acts considered to be independent from the acts that breached the contract.”
Establishes the controlling legal principle that tort actions are not barred by the economic loss rule when the tort is independent from contractual breach.
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Join FLexlaw to unlock all legal intelligenceCowley purchased real property from Nero and brought a bench trial action alleging fraudulent and negligent misrepresentations regarding the property.…
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CAMPBELL, Judge.
Appellant, Eleanor D. Cowley, challenges the trial court order that granted appellee, Larry J. Nero’s, motion for rehearing, vacated the final judgment entered in favor of appellant and entered a new final judgment for appellee. We reverse.
Appellant was the purchaser of certain real property from the appellee seller. Appellant, in the action that was tried before the trial court without a jury, sought damages from appellee for fraudulent and/or negligent misrepresentations in regard to the real property that was the subject of the sale. At the conclusion of the bench trial, final judgment was entered on July 13,1995, for appellant on her fraudulent and/or negligent misrepresentation claims adjudging simply that appellant “recover from defendant, Larry J. Nero, the sum of $28,224.00 which shall bear interest at the rate provided by law for which let execution issue.”
Thereafter on March 6, 1996, appellee’s motion for rehearing was granted, the July 13, 1995 judgment was vacated and judgment was entered in favor of appellee, defendant below, Larry J. Nero. The trial judge’s action on appellee’s motion for rehearing was “based solely on the economic loss rule relying upon Casa Clara Condominium Ass’n v. Charley Toppino & Sons, Inc., 620 So. 2d 1244 (Fla.1993); Raymond James & Associates, Inc. v. PK Ventures, Inc., [666 So. 2d 174], 20 Fla. L. Weekly D2699 (Fla. 2d DCA Dec. 6, 1995); and Woodson v. Martin, [663 So. 2d 1327], 20 Fla. L. Weekly D2556 (Fla. 2d DCA Nov. 17, 1995).”
On October 17, 1996, our supreme court issued its opinion in HTP, Ltd. v. Lineas Aereas Costarricenses, S.A., 685 So. 2d 1238 (Fla.1996), reh. denied, (Fla.1997), which quashed this court’s decision in Woodson v. Martin, 663 So. 2d 1327 (Fla. 2d DCA 1995) (en banc). The supreme court in HTP, Ltd. stated: “Where a contract exists, a tort action will lie for either intentional or negligent acts considered to be independent from the acts that breached the contract.” 685 So. 2d at 1239. Soon thereafter, this court decided Johns v. Ponto, 684 So. 2d 830, 831 (Fla. 2d DCA 1996), where we stated:
Our supreme court has recently issued two opinions which control here. In the first of these, HTP, Ltd. v. Lineas Aereas Costarricenses, S.A., No. 86,913, So. 2d (Fla. Oct. 17, 1996), the court held that where a contract exists, a tort action will lie for either intentional or negligent acts considered to be independent from acts that breach the contract. More specifically, the court stated that fraudulent inducement is an independent tort in that it requires proof of facts separate and distinct from the breach of contract; thus actions of fraudulent inducement into a contract and breach of that contract are not mutually exclusive.
The First District then followed with Wassall v. Payne, 682 So. 2d 678, 681 (Fla. 1st DCA 1996), concluding: “Thus where, as here, fraudulent misrepresentation and negligent misrepresentation in the formation of a contract are alleged, the economic loss rule does not bar the tort action based on such misrepresentations.”
Accordingly, on the basis of HTP, Ltd., Ponto and Wassail, we reverse the judgment entered for appellee on rehearing and remand with instructions that the judgment of July 13, 1995, entered in favor of appellant, be reinstated.
DANAHY, A.C.J., and SCHOONOVER, J., concur.
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United States Fire Ins. Co. v. ADT Sec. Servs., Inc., 134 So. 3d 477 (Fla. 2d DCA 2013)…. Lineas Aereas Costarricenses, S.A., 685 So. 2d 1238, 1239 (Fla.1996) (recognizing that intentional or negligent acts which are independent of the contract can give rise to a tort action; in that case, it was fraudulent inducement); Cowley v. Nero, 693 So. 2d 120, 121 (Fla. 2d DCA 1997) (recognizing that both fraudulent and negligent misrepresentation in the formation of a contract can be raised in a tort action). Here, the trial court relied on the contract to rule that ADT was entitled to a judgment on th…
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Mobil Oil Corp. v. Dade Cnty. Esoil Mgmt. Co., 982 F. Supp. 873 (S.D. Fla. 1997)…lent inducement. Fraudulent inducement is a cause of action, independent from breach of contract, to which the economic loss rule does not apply. HTP, Ltd. v. Lineas Aereas Costarricenses, S.A., 685 So.2d 1238 (Fla.1996); Cowley v. Nero, 693 So.2d 120, 1997 WL 232255 (Fla. 2d DCA May 9, 1997)(citing HTP, Ltd., supra; Johns v. Ponto, 684 So.2d 830, 831 (Fla. 2d DCA 1996); Wassall v. Payne, 682 So.2d 678, 681 (Fla. 1st DCA 1996)). As noted in the Factual Background section, Mobil allege…
Authorities Cited
- HTP, Ltd. v. Lineas Aereas Costarricenses, S.A., 685 So. 2d 1238 (Fla. 1996)
- CASA Clara Condo. Ass'n, Inc. v. Charley Toppino & Sons, Inc., 620 So. 2d 1244 (Fla. 1993)
- Woodson v. Martin, 663 So. 2d 1327 (Fla. 2d DCA 1995)
- Young v. Young, 682 So. 2d 678 (Fla. 4th DCA 1996)
- Raymond James & Assocs., Inc. v. PK Ventures, Inc., 666 So. 2d 174 (Fla. 2d DCA 1995)
- Johns v. Ponto, 684 So. 2d 830 (Fla. 2d DCA 1996)