Logan Reeve (0023224)

REEVE, PEARSON & SPECTRE

3820 Legal Lane
Stoneville, Caper 00026
(555)555-5555
loganreeve@gmail.com
Attorney for Plaintiff
IN THE THIRD DISTRICT COURT, SALT LAKE DEPARTMENT
IN AND FOR SALT LAKE COUNTY, STATE OF UTAH
THOMAS BROWN,
Plaintiff,

MEMORANDUM OF LAW IN
SUPPORT OF MOTION FOR
SUMMARY JUDGMENT

v.
TERRANCE LONG,

Case no. 1509638

Judge

Defendant.
Thomas Brown, Plaintiff, submits this memorandum of law in support of
Plaintiffs motion for summary judgment. Terrance Long, will hereby be referred to as
Defendant.
QUESTIONS PRESENTED
1. Did Defendant commit fraudulent non-disclosure when he failed to disclose
2.

the fact that the property was perceived as haunted?

Did Defendant commit fraud when he represented the property at a
discounted price because of the length of time the property had been on the
market?

FACTS
Defendant purchased a residential property and a commercial property in August
of 2000. Both properties were purchased in the city of Anytown, Utah for $250,000. A
month after the purchase, the Defendant rented out the residential property.
Unfortunately, after only a week of tenancy, the tenant was murdered on the property.
Consequently, Defendant again rented out the property to other viable tenants.
During the tenancy, the tenants informed the Defendant of eerie events and
activities occurring on the property, such as the TV turning on and off in the middle of the
night and seeing ghostly apparitions. Over time, the property received a reputation in the
local community of being haunted. Due to the negative reputation of the home, the
tenants vacated the property as well as reported electrical issues, the apparent apparition,
and the perception of the surrounding community.
Following the vacation of the tenant, the Defendant tried to rent the property for a
span of ten years to no avail. The Defendant then decided to place both previously
purchased properties for sale at $250,000 in August of 2010. In July of 2011, Plaintiff
made contact with Defendant and showed interest in the available properties.
During that time, the Defendant took the Plaintiff on a tour to view both
properties. Plaintiff discussed with Defendant his alleged plans to build a toy store on the
commercial property. Later on, Defendant expressed to Plaintiff that the sole reason why
the asking price was so low was because of the duration the properties had been on the
market and that there were unforeseen expenses to be paid. Defendant sold the properties

within a matter of sixty days and construction of Plaintiffs toy store began immediately
after the sale was completed.
Plaintiff resided in the house and opened the toy store. After only a week, Plaintiff
reported similar occurrences close to those depicted by Defendant from the previous
tenants. After asking around the community about the strange occurrences, Plaintiff
discovered that the property had an established reputation for being haunted. Plaintiff also
saw very little flow of customers from in town and rather a majority of the customers are
from out of town.
ARGUMENT
When the Defendant failed to disclose to the Plaintiff that the property for sale was
haunted, he committed fraudulent non-disclosure. In addition, the Defendant committed
fraud when he represented that the property was at a discounted price solely due to the
alleged real estate market.
A. Defendant committed fraudulent non-disclosure by failing to reveal that
the property was haunted.
According to the Supreme Court of Utah, in order to prevail on a claim of
fraudulent nondisclosure, the plaintiff must show (1) there is a legal duty to
communicate information, (2) the nondisclosed information is known to the party failing
to disclose, and (3) the nondisclosed information is material. (Yazd v. Woodside Homes
Corp., 2006 UT 47, 143 P.3d 283 (Utah 2006)

First, there must be a legal duty to communicate information. It was determined in

the Utah Court of Appeals, that the sellers of the property owed a duty to disclose known
information that [could not] be discovered by a reasonable inspection by an ordinary
prudent buyer. Hermansen v. Tasulis 48 P.3d 235, 242 (Utah Ct. App. 2002) Plaintiff
expressed his plans about how he would use the properties with Defendant, inquired
about the reasoning behind the low price, and Plaintiff conducted a reasonable inspection
of the properties. Even with the information that Defendant was given, Defendant failed
to disclose the abhorrent reputation of the property in the community, as well as any other
issues with either property.
Second, nondisclosed information that is being disputed must be known to the
party failing to disclose the information. Defendant was completely aware of the defects
and inherent reputation that the property had accrued from the local community.
Especially because Defendant owned the home when the murder occurred, received
reports of apparitions, and other problems when the previous tenants vacated the
property. Any reasonably prudent person who had this knowledge would have disclosed it
to a potential buyer and would absolutely agree that they would desire to be made aware
of this knowledge if they were the buyer.
Third, the specific nondisclosed information must be material. Defendant
experienced a prolonged duration of time without being able to rent or sell the property. It
is undisputable that Defendant had this previous knowledge and that this knowledge was
not mere opinion, culture, or circumstance but that the known undisclosed information

had affirmatively caused an economic loss to Defendant due to the nature of the
undisclosed information. Additionally, Plaintiff also incurred an economic loss because
the undisclosed information that was prevalent in the community drastically affected the
Plaintiffs successfulness in conducting his business. Contingently, the habitability of the
residential property was harshly impacted.

B. Defendant committed fraud by falsely representing that the property was

discounted due to the current real estate market.
According to the Utah Court of Appeals, the following elements are required for
fraud:
(1) that a representation was made (2) concerning a presently
existing material fact (3) which was false and (4) which the
representor either (a) knew to be false or (b) made recklessly,
knowing that there was insufficient knowledge upon which to base
such a representation, (5) for the purpose of inducing the other
party to act upon it and (6) that the other party, acting reasonably
and in ignorance of its falsity, (7) did in fact rely upon it (8) and
was thereby induced to act (9) to that party's injury and damage.
Cardon v. Jean Brown Research, 327 P.3d 22, 24 (Utah Ct. App. 2014).
The definition of fraud, as stated above, in conjunction with the facts of this case
is sufficient to declare that Defendant committed fraud.

CONCLUSION
The aforementioned arguments and the damages caused to Plaintiff were a direct
consequence as a result of Defendants commission of fraudulent non-disclosure and
fraudulent misrepresentation. Plaintiff respectfully requests that the court to grant his
motion for summary judgment and award suffered damages to cover the amount paid to
purchase the properties and the materials to erect the toy store.