## Facts

- Walter J. Ingaharro agreed to buy a house and lot from Jacques and Theresa Blanchette in Candia, New Hampshire.
- The purchase-and-sale agreement contained a merger clause stating that all representations were contained in the writing; the writing did not address the water supply.
- The Blanchettes had lived on the property for about ten years and experienced recurring, significant water-supply problems, including redrilling two wells and conserving water during summer.
- The Blanchettes did not volunteer information about the water-supply problems before closing.
- Ingaharro observed an outdoor pool and certain conservation-related conditions (such as unflushed toilets) but did not ask questions about the water supply.
- After closing and transfer of possession, the water supply failed; only then did the Blanchettes disclose that summer water problems occurred and improved in the fall.
- Ingaharro sued for negligent misrepresentation based on nondisclosure of the water-supply defect.

## Issues

1. Whether the merger clause barred admission of extrinsic evidence to support a claim of negligent misrepresentation based on pre-contract nondisclosure.
2. Whether residential sellers who know of a serious latent defect in a property’s water supply have a duty to disclose it to the buyer, such that silence can constitute negligent misrepresentation even absent specific inquiry.

## Decision

- The Supreme Court of New Hampshire affirmed the judgment for Ingaharro.
- The merger clause did not preclude parol evidence offered to prove fraud or misrepresentation.
- The sellers’ knowledge of a serious, latent, recurring water-supply defect created a duty to disclose to the buyer.
- The sellers’ nondisclosure supported liability for negligent misrepresentation.

## Legal Principles

- A contractual merger (integration) clause does not bar evidence offered to prove fraud or misrepresentation; the parol evidence rule yields to misrepresentation claims.
- In a residential real estate transaction, a seller’s silence may be actionable as negligent misrepresentation when the seller has a duty to disclose a material fact.
- A seller who knows of a serious latent defect affecting habitability or essential utilities has a duty to disclose it to a buyer who is unaware and cannot reasonably discover it through ordinary inspection.

## Conclusion

The court held that sellers may be liable for negligent misrepresentation by omission when they fail to disclose a known, serious latent defect such as an inadequate water supply, and that a merger clause does not insulate sellers from misrepresentation claims or exclude related extrinsic evidence.


Ingaharro v. Blanchette, 440 A.2d 445 (N.H. 1982)