Broker Not Liable for Injuries

Read the full decision: Jacobs v. Coldwell Banker Residential Brokerage Co

California appellate court rules listing broker did not have a duty to warn potential purchaser that standing over an empty pool on a diving board posed a risk of injury because the danger was open and obvious.

A real estate brokerage (“Brokerage”) marketed for sale a bank-owned, vacant property. In the multiple listing service entry, the salesperson handling the listing had placed the following note: “[P]lease use CAUTION around the empty pool.”

A contractor (“Contractor”) and his wife visited the property with their representative, as they were considering purchasing an investment property. The Contractor testified that he regularly worked around pools and knew that falling into an empty pool “would hurt.” After touring the house, the couple went outside and the representative opened the latched gate to the pool area. The Contractor examined the pool, and then walked out onto the diving board over the pool to see how accessible the pool was from a nearby road. Within 30 seconds of walking out onto the diving board, the diving board collapsed and the Contractor fell into the empty pool, suffering serious injuries.

The Contractor brought a lawsuit against the Brokerage, alleging that the Brokerage was negligent because it failed to warn him that the diving board posed a danger to visitors. The Brokerage filed a motion for judgment in its favor, arguing that the Brokerage did not owe a duty to the Contractor and had no knowledge that the diving board posed a danger. The trial court found there was no evidence that the Brokerage had knowledge that the diving board was defective and entered judgment in favor of the Brokerage. The Contractor appealed.

The California Court of Appeal, Second District, affirmed the judgment of the trial court. On appeal, the Contractor argued that the trial court had improperly barred his argument that the Brokerage had a duty to warn him about the danger of the empty pool. The court had barred these arguments because the Contractor had failed to make this allegation in his initial pleadings, as he had only claimed the Brokerage had a duty to warn him about the diving board.

The court ruled that the trial court had properly barred the arguments about the empty pool but, even if the arguments had been allowed, it would not have changed the result. First, the court stated that a party cannot make an unpled, undisclosed theory in the middle of a case and so the Contractor was limited to his argument in his complaint that the Brokerage had a duty to warn the Contractor about the diving board.

However, even if the Contractor could make the argument about the empty pool, the court stated that the Brokerage would still be entitled to judgment because there was no duty to warn the Contractor about an open and obvious danger like an empty pool. The danger of the empty pool would be obvious to any visitor of the property and so the Brokerage would have no reason to expect visitors to not realize the danger of the empty pool. Additionally, the Brokerage did not invite the Contractor to approach the empty pool; in fact, the Brokerage had placed a warning in the MLS about the empty pool. Thus, the court affirmed judgment in favor of the Brokerage.

Jacobs v. Coldwell Banker Residential Brokerage Co., 14 Cal. App. 5th 438 (Cal. Ct. App. 2017).

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