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Heiderscheit v. Cherne

Court of Appeals of Iowa

November 22, 2017

ALEX HEIDERSCHEIT, Plaintiff-Appellee,
v.
ERIC CHERNE and JENNIFER CHERNE, Defendants-Appellants.

         Appeal from the Iowa District Court for Delaware County, John J. Bauercamper, Judge.

         Home sellers appeal from judgment in favor of home buyer. REVERSED AND REMANDED.

          Hillary J. Friedmann of Friedmann Law Office, Guttenberg, for appellants.

          Dan McClean of McClean & Heavens Law Offices, Dyersville, for appellee.

          Considered by Danilson, C.J., and Tabor and McDonald, JJ.

          MCDONALD, JUDGE

         Eric and Jennifer Cherne sold their home to Alex Heiderscheit in 2012. Heiderscheit had subsequent problems with the home and brought this action against the Chernes. The district court ruled in favor of Heiderscheit. The Chernes now appeal.

         I.

         The Chernes purchased the home at issue in 2004. They sold it to Heiderscheit in 2012. The parties were aware of potential problems with the home's septic system prior to completion of the real estate transaction. Several documents acknowledge those issues. A proposed purchase contract provided: "In the event the septic system needs to be replaced and repaired, seller will incur all expenses to have septic system brought up to Iowa Code." The inspection addendum to the purchase contract provided: "With written acceptance of said purchase contract, buyer shall require the seller to provide the results of a septic system inspection performed by a DNR certified inspector." Heiderscheit submitted a counteroffer to the proposed contract. His counteroffer provided: "Seller will assure septic meets current transfer standards and provide supporting certification at least ten days prior to closing or sooner if contractor can complete earlier." The Chernes submitted their own counteroffer in response, which provided: "Seller will not be required to provide results of a septic inspection by 4/25/12, as seller is aware that septic does not meet current transfer standards. Seller will assure septic meets current transfer standards and provide supporting certification, by replacing or repairing septic system, at least ten days prior to closing or sooner if contractor can complete earlier." Heiderscheit accepted this counteroffer. The residential seller disclosure sheet provides: "Septic system installed. Maintenance of $165 every four years."

         Pursuant to the purchase contract, the Chernes replaced the septic system prior to sale. The septic installation was completed on or about May 25, 2012, by Harter Custom Plumbing/Septic. Robb Harter, the owner of Harter Custom Plumbing/Septic, completed a time of transfer inspection report. The report provided the system was new and in good condition. The report also provided, "This report indicates the condition of the private sewage disposal system at the time of the inspection. It does not guarantee that it will continue to function satisfactorily." The parties completed the real estate transaction in June.

         In March 2013, water and effluent leaked into the basement of the home and out of the ground surrounding the home. Heiderscheit hired several repair services. Eventually, a new septic system was installed. In 2015, Heiderscheit listed the home for sale and included this note on his real estate disclosure statement:

Previous owner [i.e., the Chernes] had new septic installed prior to our closing in June of 2012, due to the old septic not meeting Iowa Code. In March 2013, the basement had standing water. We involved two septic companies and the Delaware County Sanitation Supervisor to find out what may be causing this. No justifiable reasons were found. We had a construction company come in and they dug a hole in the basement floor and found a broken pipe. They repaired and capped off the end and installed a new sump pump. During this process, it was discovered that the septic system was installed incorrectly. A brand new septic system was installed by Oasis Well and Pump in August/September 2015. No issues since!!

         Elsewhere in the real estate disclosure statement he clarified the new sump pump was installed in 2013.

         Heiderscheit brought suit against the Chernes in October 2015. The case proceeded to bench trial in September 2016. On September 7, the Chernes filed a trial brief in which they wrote, "It is unclear from plaintiff's Petition at Law which theory of recovery they are using to seek relief." The trial brief went on to discuss Iowa Code Chapter 558A (2015), which concerns real estate disclosure statements. On September 12, Heiderscheit filed a trial brief asserting ...


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