## Facts

- Rebecca A. Thomson contracted to purchase a residence in Charleston, West Virginia, in April 1992.
- Thomson was represented by her own real estate agent; the seller was represented by listing agent Erma McGinnis, employed by The Property Centre, Inc., with broker Robert R. Vitello.
- At Thomson’s request, the broker defendants agreed to have the furnace inspected and to certify that the heating system was in working condition; Thomson’s mortgage approval was conditioned on such certification.
- Thomson asserted McGinnis stated she would “take care of getting the inspection of the furnace,” and no other furnace-related representations were made.
- McGinnis and The Property Centre engaged David R. Stephens of D & R Builders, initially for termite inspection and installing smoke detectors; McGinnis also asked him to inspect the heating system.
- Stephens’s inspection consisted of listening to the furnace while in the home; he signed a heating certification form stating the furnace was in working condition.
- After closing and moving in, Thomson discovered the furnace was not functioning properly due to asbestos on the heating pipes.
- Stephens later told Thomson he was not heating-certified, should not have signed the certification, and signed at McGinnis’s direction.
- Thomson sued, alleging negligence and fraudulent misrepresentation against the broker defendants and others related to the furnace inspection and certification.

## Issues

1. Whether evidence of the broker defendants’ conduct regarding the furnace inspection and certification created a triable issue on misrepresentation or a negligent undertaking connected to the property’s habitability.
2. Whether Stephens and D & R Builders were independent contractors or agents/servants subject to the broker defendants’ control, permitting vicarious liability.
3. Whether summary judgment was proper under West Virginia standards when material facts on reliance, inducement, and control were disputed.

## Decision

- The Supreme Court of Appeals of West Virginia reversed the circuit court’s grant of summary judgment for McGinnis, Vitello, and The Property Centre, Inc.
- The court held the record contained genuine issues of material fact on the nature and effect of McGinnis’s undertaking to obtain inspection and certification of the furnace.
- The court held there were triable issues on whether Stephens acted as an independent contractor or as an agent/servant, given evidence bearing on the broker defendants’ control or right of control.
- The case was remanded for further proceedings on the merits.

## Legal Principles

- A vendor’s real estate broker may be liable to a purchaser for material misrepresentations about fitness or habitability, or for failing to disclose defects substantially affecting value or habitability that the broker knows or reasonably should know, when the purchaser is unaware and the defect would not be discovered by reasonably diligent inspection, and the misrepresentation or concealment substantially induced the purchase.
- Summary judgment is proper only when the record as a whole could not permit a rational fact-finder to rule for the nonmoving party on an essential element; the court determines whether a genuine factual dispute exists, not how it should be resolved.
- An agency relationship requires some degree of control by the principal over the agent’s conduct; the independent contractor defense turns on whether the defendant controlled or had the right to control the work.
- A defendant asserting independent contractor status to avoid tort liability bears the burden to show lack of control; where evidence conflicts and could support either finding, the issue is for the fact-finder.

## Conclusion

The court reinstated Thomson’s claims against the broker defendants because disputed facts about the broker’s undertaking to secure a furnace certification, Thomson’s reliance and inducement, and the broker defendants’ control over the person who performed and signed the certification made summary judgment improper.


Thomson v. McGinnis, 195 W. Va. 465, 465 S.E.2d 922 (1995)