COURT OF APPEALS OF OHIO, EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 70582 ROBERT SCHLECHT, ET AL. : : Plaintiffs-appellees : : JOURNAL ENTRY -vs- : AND : OPINION BENEDETTA HELTON, EXECUTRIX : Estate of Vera Schroeder : : Defendant-appellant : : DATE OF ANNOUNCEMENT : OF DECISION : JAN. 16, 1997 CHARACTER OF PROCEEDING : Civil appeal from South Euclid Municipal Court : Case No. 4724 JUDGMENT : Affirmed. DATE OF JOURNALIZATION : APPEARANCES: FOR PLAINTIFFS-APPELLEES: FOR DEFENDANT-APPELLANT: Robert Schlecht, Pro Se Robert C. Kreps, Esq. Maria Schlecht, Pro Se 21400 Lorain Road 4506 Liberty Road Fairview Park, Ohio 44126 South Euclid, Ohio 44121 -2- STRAUSBAUGH, J.: Benedetta Helton, defendant-appellant ("appellant"), as the executrix of the estate of Vera Schroeder, appeals the judgment of the South Euclid Municipal Court. The trial court adopted the findings of a magistrate and ruled in favor of plaintiffs- appellees, Robert Schlecht and Marie Schlecht ("appellees"). For the reasons set forth herein, we affirm the ruling of the trial court. In the underlying litigation, appellees pro se filed a complaint in South Euclid Municipal Court. The complaint alleged that appellant engaged in fraudulent representation in the sale of residential real estate located at 4506 Liberty Road, South Euclid, Ohio. A hearing was held before the magistrate. The magistrate set forth the apposite facts in the December 20, 1995, Decision of the Magistrate ("magistrate's decision") and the February 26, 1996 Supplemental Decision of the Magistrate ("magistrate's supplemental decision"). Appellant's mother ("decedent") died in mid-September of 1994 leaving appellant as executrix and sole beneficiary of her estate. Decedent's real estate was sold to the appellees pursuant to a purchase agreement dated November 6, 1994. Prior to decedent's death, appellant had not lived in decedent's home for about eight years and decedent had not lived in the home since the beginning of 1994. Appellant's husband, Mr. Helton, had not lived in decedent's home either. Appellant and her husband had infrequent access to the basement and there -3- had been little discussion with the decedent about the basement's condition prior to decedent's death. In October of 1994, Mr. Schlecht called Mr. Helton to inquire about whether the house was for sale. Mr. Helton informed him that the home was for sale. Mr. Helton accompanied appellee Mr. Schlecht when he viewed the house. During the viewing of the house, Mr. Helton was asked about the dampness in the basement and staining on the walls. In response to this inquiry, Mr. Helton responded that decedent had dogs living in the basement for fifteen years. Decedent would have corrected any water problems had she known of any, and that he was not aware of any water problems. Later, appellees called Mr. Helton back to inform him that they were interested in buying the house. Appellees requested a second viewing of the house. Mr. Helton accompanied appellees while they viewed the house for a second time, and answered any questions they had concerning the house. Helton participated in drawing up a purchase agreement and on November 6, 1994, appellees executed the purchase agreement. The purchase agreement contained a right of inspection clause, an "as is" clause, and a parol-evidence clause. A "property information checklist" accompanied the purchase agreement. At the end of December 1994, title to the property was transferred and appellees took possession in the beginning of January 1995. Subsequently, appellees discovered water problems in the basement. Appellees contacted Del Brocco Sewer, Inc. to inspect and provide a repair estimate. Mr. Del Brocco indicated that the cost to repair the problems was set at $11,525. The -4- problems in the basement were extensive, attributable to problems in the foundation, cracked outside walls, and problems with the drain tile and storm line. The problems, furthermore, had been on going for a long time, and could not be the result of two pets living in the basement and urinating on the walls of the basement. Based on the findings of fact and conclusions of law, the magistrate proposed that a finding be entered in favor of appellees against appellant in the amount of $2,000 plus interest at the rate of 10 percent per annum, plus court costs. The trial court adopted the findings of fact and conclusions of law by the magistrate. Appellant appeals from the trial court's decision and raises the following assignments of error for this court to review: I. THE TRIAL COURT ERRED IN CONCLUDING THAT THE FACTS FOUND ESTABLISHED FRAUDULENT MISREPRESENTATION. II. THE TRIAL COURT ERRED IN FAILING TO ENTER JUDGMENT FOR DEFENDANT-APPELLANT AS A MATTER OF LAW. In the first assignment of error, appellant alleges error on the part of the trial court in concluding that the facts found established fraudulent misrepresentation. However, appellant submits that the doctrine of caveat emptor is applicable to the facts of the instant case. At the outset of our analysis, we note that appellant did not produce a transcript of the testimony presented to the magistrate either to the trial court or to this court. Chaney v. East dba All-Pro Transmission (1994), 97 Ohio App.3d 431. As a result, this court presumes regularity and affirms the judgment -5- of the trial court. Id. Knapp v. Edwards Laboratories (1980), 61 Ohio St.2d 197. In analyzing appellant's assignment of errors, we are guided by the standard of appellate review which mandates that a judgment of the trial court which is supported by competent and credible evidence shall not be reversed as being against the weight of the evidence. Myers v. Garson (1993), 66 Ohio St.3d 610; C.E. Morris Co. v. Foley Construction Co. (1978), 54 Ohio St.2d 279. The Ohio Supreme Court in Layman v. Binns (1988), 35 Ohio St.3d 176, set forth the doctrine of caveat emptor in the syllabus: The doctrine of caveat emptor precludes recovery in an action by the purchaser where: (1) the condition complained of is open to observation or discernable upon reasonable inspection; (2) the purchaser had the unimpeded opportunity to examine the premises; and (3) there is no fraud on the part of the vendor. Under the rule of caveat emptor, buyers are responsible for discerning patent defects. Layman, supra. If a purchase agreement states that the buyer purchases real property in its "as is" physical condition, the vendor has no duty to disclose latent defects. Kossutich v. Krann (Aug. 19, 1990), Cuyahoga App. No. 57255, unreported, citing Klott v. Associates Real Estate (1974), 41 Ohio App.2d 118. A seller may be liable for non-disclosure of a latent defect when he is under a duty to disclose facts and fails to do so. Layman, supra. -6- The elements for a cause of fraudulent misrepresentation include: (1) an actual or implied misrepresentation; (2) which is material to the transaction; (3) made with knowledge that the statement is false; (4) with the intent to mislead another; (5) who relies on the misrepresentation; and (6) with a resulting injury. Kossutich. A seller is liable for fraudulent misrepresentation and/or fraudulent concealment. Layman. An "as is" disclaimer clause in a real estate agreement bars suit for passive non-disclosure but does not protect a seller from action alleging positive misrepresentation or concealment. Kossutich, supra. Pursuant to R.C. 5382.30, effective July 31, 1993, most sellers of residential real estate are required to disclose information they possess concerning any material defect in the property. R.C. 5302.30(C) provides that any person who intends to transfer real property must complete and deliver to the transferor a property disclosure form. The form provides that the transferor must disclose material matters relating to the physical condition of the property to be transferred and any material defect in the property that is within the actual knowledge of the transferor. R.C. 5302.30(D). Compliance with the statute does not eliminate a seller's duty to disclose defects. Davis v. Kemptor (Aug. 10, 1996), Union App. No. 14- 95-C1, unreported. We find that sufficient evidence supported the magistrate's determination that Mr. Helton's statements concerning the real property constituted fraudulent misrepresentation and the trial -7- court did not err when it adopted the magistrate's finding. The property information check list did not indicate water problems in the basement. Here, Mr. Helton's false representations were material to the sale of the house to appellees; appellees relied on his statement when they purchased the house, and appellees were injured as a result of their reliance concerning the house. Accordingly, appellant's assignment of error is overruled. In the second assignment of error, appellant charges that the trial court erred in failing to find for appellant as a matter of law. Appellant argues that the condition of the basement was open and obvious and appellees observed the stains on the basement wall prior to the purchase of the property. Thus, since appellees were put on notice that the basement had an existing water problem, the trial court should have concluded as a matter of law that Mr. Helton's statements did not constitute fraudulent misrepresentation. Furthermore, the "as is" clause in the purchase agreement is binding, precludes liability on Mr. Helton's part. An "as is" clause in purchase agreements does not bar fraud claims. Kaye v. Buehrle (1983), 8 Ohio App.3d 381. A clause limiting liability will not preclude liability for a fraudulent misrepresentation if it can be shown that the statements were made under circumstances of fraud. Sanfillipo v. Rarden (1985), 24 Ohio App.3d 164. It is our opinion that the trial court properly applied the law in finding that appellant engaged in fraudulent misrepresentation of the basement's condition. Appellant's -8- signed property disclosure form failed to indicate that any water problems existed in the basement. The magistrate properly concluded that as a result of Mr. Helton's direct answer to appellees' questions about the condition of the basement, appellant was not entitled to judgment as a matter of law. Where there exists competent and credible evidence supporting findings and conclusion of the trial court, deference to such findings must be given by the reviewing court. Myers, supra. Accordingly, appellant's assignment of error is overruled. Judgment affirmed. -9- It is ordered that appellee recover of appellant their costs herein taxed. The Court finds there were reasonable grounds for this appeal. It is ordered that a special mandate issue out of this Court directing the South Euclid Municipal Court to carry this judgment into execution. A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of the Rules of Appellate Procedure. JAMES M. PORTER, P.J., DIANE KARPINSKI, J., CONCUR JUDGE *DEAN STRAUSBAUGH (* Sitting by assignment: Judge Dean Strausbaugh, retired from the Tenth District Court of Appeals). N.B. This entry is an announcement of the court's decision. See App.R. 22(B), 22(D) and 26(A); Loc. App.R. 27. This decision will be journalized and will become the judgment and order of the court pursuant to App.R. 22(E), unless a motion for reconsideration with supporting brief, per App.R. 26(A) is filed within ten (10) days of the announcement of the court's decision. The time period for review by the Supreme Court of Ohio shall begin to run upon the journalization of this court's announcement .