Strawn v. Canus

657 A.2d 420 (1995)

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Nature of the Case

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Facts

Over 150 families, Ps, purchased new homes from Ds. Ps later discovered that all their homes had been built near a hazardous-waste dump. Twenty-six P-families filed a class-action suit on behalf of all of the purchasers of the homes in the development sold by Ds. Ps base their claims on common-law theories of fraud and negligent misrepresentation and the New Jersey Consumer Fraud Act. Ps contend that between 1966 and 1978, large amounts of hazardous materials and chemicals were dumped at the Buzby Landfill. Toxic materials escaped contaminating the groundwater and air. The federal Environmental Protection Agency recommended that the site be considered for a Superfund cleanup. Ps allege that ds knew of the Buzby Landfill before they considered the site for residential development and that, although specifically aware of the existence and environmental hazards of the landfill, they failed to disclose those facts to Ps when they purchased their homes. The trial court denied class certification, finding that plaintiffs had failed to establish the predominance of common issues sufficient to warrant certification. D moved for summary judgment against the individual Ps. The trial court ruled that D did not owe a duty to prospective purchasers to disclose conditions of the property but that the seller could be liable for affirmative misrepresentations. The trial court granted summary judgment dismissing all of the claims of seven families who did not assert affirmative misrepresentations in their complaint. The seven plaintiff-families sought leave to appeal to the Appellate Division, which was granted. The Appellate Division reversed the decision of the trial court; the builders and brokers of the development had a duty to disclose to potential buyers the existence of the nearby, closed landfill. The court also concluded that class certification should have been granted to redress the common legal grievance asserted by plaintiffs. Ds appealed.