ÿWPCA! !æ[Ý—ÀXê3é•/¹ÙßrYê3CWŠå]‘GÁV.Üݤߠ„± ÓØ ߃,> t—_“É£h¢ÙKÜóQÜ>ê°ó¥¶ýHm¬­md¡Zr¿(T¼Î¡çY‡Re¼4ÝS9Þ~ì¤Kà@š‚×4K"ç™ö(]‰µÈ㵦/Ãû5-Ù÷"ìcôôY~ 2ZÃêSd\ìC ãý É–ü ÒÝèÌ ZVù¯û··öÕ§Äù.ÒLEi™GeåˆÎ`Ã7;y¤3Eæ<¸§¹ÒW¢‹x(’… û¬‡ñ‰áîbI8oXrá?¸ü\+6IJ^²²èšUhÿ±£pró«8boe vL‰–Duy(wÓè®_-èÞ ‹c6|ìD!1²˜ˆprVˆ‘>5³íÃƧâ„@ÑäQ°4r ÓdˆÎý¥E?îpq)Nµ–³]KŸ#óECº'sž=‘ßn÷vÝüjå§h}bî)GuÁóÑë¼ú̬& •;PˆEêºkºÈ£,lò™f…9d›ÕÅðÏؘuz½ñ!A’HmkmâBmÂo±  [ënû°är¸!8a¾Jœµ"* YjëêÄ„¬·n•ÞÇÅ.+ÃW#ÉÂUN‹ %Ù 0:ß U N ^ g ws 4w ‹ š mœ b³ Z» ß    ;ôô 0 D/wsEêàìÓÌdŸ¹““““^LLݪªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªªª 0 ‡ ‡ ‡ ‡ B$!˜\\ib01s01\clerk1nasÈÈ,,,,ÈÈ0(ÖÃ9 Z‹6Times New Roman RegularX(üœ$¡¡ÔUSUS.,Ô(í€"  Z6Times New Roman Regularr’‘1î INŽ1ê:i¢×+003|x ÿU‹ÿÀÀÀ- ù- PÝ ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú4Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔOn€July€2,€2001,€the€Pitzes€filed€an€amended€complaint€substituting€the€Herbert€F.€Pitz€1993€RevocableÐ ° ÐTrust€and€the€Shirel€H.€Pitz€1993€Revocable€Trust€as€plaintiffs€in€the€complaint. ÕÝ ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú3Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔThe€deed€to€the€property€conveyed€a€one„half€undivided€interest€to€Herbert€F.€Pitz,€Trustee€under€theÐ ° ÐHerbert€F.€Pitz€1993€Revocable€Trust,€and€a€one„half€undivided€interest€to€Shirel€H.€Pitz,€Trustee€under€the€Shirel€H.Ð tÄ ÐPitz€1993€Revocable€Trust,€as€joint€tenants€with€a€right€of€survivorship.€€The€conveyance€to€the€trusts,€rather€than€toÐ 8ˆ Ðthe€individual€Pitzes,€was€not€known€to€the€Woodruffs€until€the€date€of€closing.€€The€involvement€of€the€trusts€in€thisÐ üL Ðtransaction€is€not€pertinent€to€the€issues€on€appeal 1Ý ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú2Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔThough€the€contract€was€dated€April€30,€2000,€the€parties€actually€signed€the€contract€on€May€13,€2000Ð ° Ð(the€Pitzes),€and€on€May€26,€2000€(the€Woodruffs).(#Ã$òòÚ  Ú0Ú  Úóó mÝ ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú5Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔIn€his€deposition,€Mr.€Woodruff€claimed€that€he€fixed€the€leak€in€1999.€€At€trial,€however,€he€claimed€thatÐ ° Ðhe€fixed€the€leak€three€years€before€the€sale€of€the€house€in€2000,€which€would€indicate€that€the€repair€was€made€inÐ tÄ Ð1997.€Mrs.€Woodruff€testified€in€her€deposition€that€the€repair€was€made€two€or€three€years€before€the€house€was€putÐ 8ˆ Ðon€the€market.€€In€any€event,€this€disputed€fact€is€immaterial€to€the€issues€on€appeal. ÖÝ ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú8Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔThe€lawsuit€also€named€the€real€estate€agent,€her€affiliate€agency,€and€the€homeowner/agentððs€€real€estateÐ ° Ðagency€as€defendants.€€ò òòòÔ_ÔEdmondsonÔ_Ôó óóó,€1992€WL€108717,€at€*1„*2.€€However,€issues€related€to€the€other€defendants€areÐ tÄ Ðnot€relevant€to€this€appeal.€€€ ÉÝ ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú9Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔThe€trial€court€bifurcated€the€case€for€trial,€dealing€with€the€claims€related€to€flooding€in€one€proceeding,Ð ° Ðand€dealing€with€the€claims€for€fraudulent€concealment€of€the€defects€in€a€separate€proceeding.€€ò òòòÔ_ÔEdmondsonÔ_Ôó óóó,€1992Ð tÄ ÐWL€108717,€at€*2.€ ZÝ ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú7Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔThe€purchasers€also€claimed€that€material€representations€had€been€made€regarding€the€flooding€of€a€creekÐ ° Ðlocated€on€the€back€of€the€property.€€The€courtððs€discussion€regarding€the€ð ðas€isðð€clause,€however,€related€only€to€theÐ tÄ Ðpurchasersðð€claims€of€fraudulent€concealment€and€non„disclosure€of€defects€in€the€house.€€ò òòòÔ_ÔEdmondsonÔ_Ôó óóó,€1992€WLÐ 8ˆ Ð108717,€at€*10„*11. SHIREL COA P.J. W.S.Highers ExhPitzesthermopanePitzesAprildehumidifierhad had DeposheetrockPragelEdmondsonnondisclosure PitzT]hereShahrdar I]t ¯Ý ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú10Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔThe€trial€court€indicated€that€the€ð ðwarrantyðð€language€in€section€66„5„201€disallows€a€lawsuit€based€solelyÐ ° Ðon€misrepresentations€in€the€disclosure€form.€€In€light€of€our€decision,€we€need€not€decide€whether€the€trial€court€wasÐ tÄ Ðcorrect€on€that€point.€€ TÝ ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú6Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔIn€dicta,€the€trial€court€surmised€that,€if€the€ð ðas€isðð€language€had€not€been€made€a€part€of€the€contract,€ð ðit€isÐ ° Ðclear€that€damages€occurred€as€a€result€of€the€representations.ðð€€€The€trial€court€opined€that€the€cost€of€moving€theÐ tÄ Ðfence,€the€cost€of€replacing€the€thermopane€windows,€and€the€cost€of€putting€drainage€holes€in€the€foundation€of€theÐ 8ˆ Ðdeck€would€have€been€appropriate€damages.€€ ÓÝ ƒR+‡$ÝÔUSUS.,Ôà  àòòÚ  Ú1Ú  ÚóóÔ€ôÀòXXÔÝ  ÝÔ_ÔSection€C€on€the€disclosure€form€asks,€ð ðAre€you€(Seller)€aware€of€any€significant€defects€or€malfunctions€inÐ ° Ðany€of€the€following?ðð€€Then€it€lists€fifteen€categories€in€which€the€seller€can€mark€ð ðyes,ðð€ð ðno,ððor€ð ðunknown.ðð€€TheÐ tÄ ÐWoodruffs€marked€ð ðnoðð€in€each€category.(.G2+‡$¤¤Ý ƒüœ!ÝÔUSUS.,ÔÝ  Ýà  àòòÚ  Ú0Ú  ÚóóÔ€ôÀòXXÔ dÝ ƒüœ!ÝÔUSUS.,ÔÝ  ÝÔ_ÔÔ‡XúœXXXÔÔ‡¼@Ñ»XXúœÔÑ€ ÑÑ8€úœXXdìdÈ8ÑÑ  ÑÑ  Ñà@ü ü ìàÔ#†XúœX»¼@Ñ\#ÔÔ‡îOîXXúœÔIN€THE€COURT€OF€APPEALS€OF€TENNESSEEˆÐ ° Ðà@kk$ìàAT€NASHVILLEÔ#†XúœXîîO#ÔÔ‡¼@Ñ»XXúœÔˆÐ Ö& ÐÓ  ÓAugust€5,€2004€SessionÐ üL ÐÔ#†XúœX»¼@Ѫ#ÔÌò òÔ‡¼@Ñ»XXúœÔà @ àà @ àHERBERT€F.€PITZòò€and€óóSHIREL€H.€PITZ€Ð úJ Ðòòóóv.€Ð  ^ ÐDONALD€E.€WOODRUFFòò€and€óóDOROTHY€D.€WOODRUFFòòóóó óÐ " r ÐÌà@@½½ìàò òÔ#†XúœX»¼@Ñ=#ÔAn€Appeal€from€the€Chancery€Court€for€Lincoln€CountyÐ H ˜ Ðà@@øøìàNo.€11,595€€€€€€€€€€€€€€€€J.€B.€Cox,€ChancellorÐ 4„  Ѐ€€€€€€€€€€€€€€Ð  p  Ðà@@ìì*ìàßA€V) °°` d€÷E< ` AßÐ  \  ÐÌà@@TTìàNo.€M2003„01849„Ô_ÔCOAÔ_Ô„R3„CV€„€Filed€December€17,€Ô_Ô2004Ô_ÔÐ W  ÐÌßA€V) °°` dE<Þ` AßÐ ß/ Ðó óÌÓ  ÓThis€case€involves€claims€of€fraud€arising€out€of€the€sale€of€a€house.€€The€plaintiff€purchasers€signedÐ Ú* Ða€contract€to€buy€a€house€owned€by€the€defendants.€€The€contract€to€sell€contained€an€ð ðas€isðð€clause,Ð Æ Ðallowing€inspection€of€the€property€but€requiring€the€sale€to€be€ð ðas€is.ðð€€The€purchasers€did€notÐ ² Ðinspect€the€house€further€before€the€closing.€€After€the€purchasers€took€possession,€they€noticedÐ žî Ðseveral€defects€in€the€house€that€were€not€disclosed€by€the€sellers.€€The€purchasers€sued€the€sellers,Ð ŠÚ Ðalleging€that€the€sellers€had€made€material€misrepresentations€of€fact€and€had€fraudulently€concealedÐ vÆ Ðor€failed€to€disclose€material€defects€in€the€house.€€After€a€bench€trial,€the€trial€court€held€in€favorÐ b² Ðof€the€sellers.€€It€concluded€that,€although€the€sellers€had€made€material€misrepresentations€of€fact,Ð Nž Ðthe€purchasersðð€reliance€on€those€representations€was€not€reasonable€because€of€the€ð ðas€isðð€provisionÐ :Š Ðin€the€contract€and€because€the€defects€were€either€apparent€or€readily€discoverable.€€The€purchasersÐ &v Ðnow€appeal.€€We€affirm,€finding€that€the€evidence€does€not€preponderate€against€the€trial€courtððsÐ b Ðconclusion€that€the€purchasersðð€reliance€was€not€reasonable.€€€€€€€€Ð þN ÐÓtÓÌò òTenn.€R.€App.€P.€3€Appeal€as€of€Right;€Judgment€of€the€Circuit€Court€is€Affirmed€Ð Ö& Ѐó óÐ   ÐòòÓ  ÓHolly€M.€Kirby,€J.óó,€delivered€the€opinion€of€the€Court,€in€which€W.€òòFrank€Crawford,€P.J.,€W.S.,€óóÐ ®!þ  Ðand€òòAlan€E.€Highers,€J.óó,€joined.Ð š"ê! ÐÌT.€Lance€Carter,€Fayetteville,€Tennessee,€for€the€appellants,€Herbert€F.€Pitz€and€Shirel€H.€Pitz,Ð r$Â# Ðindividually€and€as€trustees€for€the€Herbert€F.€Pitz€1993€Revocable€Trust€and€the€Shirel€H.€Pitz€1993Ð ^%® $ ÐRevocable€Trust,€respectively.Ð J&š!% ÐÌWilliam€E.€Simms,€Fayetteville,€Tennessee,€for€the€appellees,€Donald€E.€Woodruff€and€Dorothy€D.Ð "(r#' ÐWoodruff.Ð )^$( ÐÓà ÓÓ  ÓÌò òÌÐ  Ò+"'+ Ðà@66'ìàOPINIONó óˆÐ ° ÐÌà  àDefendants/Appellees€Donald€E.€Woodruff€and€his€wife,€Dorothy€D.€Woodruff€(collectively,Ð ˆØ Ðð ðthe€Woodruffsðð),€owned€a€16.72„acre€tract€of€land€in€Lincoln€County,€Tennessee.€€In€1988,€theyÐ tÄ Ðconstructed€a€house€on€the€property.€€They€lived€in€the€house€for€about€twelve€years.€€Ultimately,Ð `° Ðthey€decided€to€sell€the€property.€€On€January€27,€2000,€in€contemplation€of€selling€it,€the€WoodruffsÐ L œ Ðcompleted€a€Tennessee€Residential€Property€Condition€Disclosure€(ð ðdisclosure€formðð)€indicating€thatÐ 8 ˆ Ðthe€house€had€no€significant€defects€or€malfunctions.׃!×Ý ƒ#ÃÝòòÚ  Ú1Ú  ÚóóÝ  Ý×  ׀Р$ t ÐÌà  àOn€April€19,€2000,€Plaintiffs/Appellants€Herbert€F.€Pitz€and€his€wife,€Shirel€H.€PitzÐ ü L  Ð(collectively,€ð ðthe€Pitzesðð),€visited€the€property€for€about€two€and€a€half€hours.€€They€becameÐ è 8  Ðinterested€in€buying€it,€and€on€April€20,€2000,€the€Pitzes€again€visited€the€property.€€This€time,€theyÐ Ô$  Ðspent€four€to€five€hours€looking€at€the€house.€€On€or€about€April€30,€2000,€the€parties€entered€intoÐ À  Ða€contract€for€the€sale€of€the€property.׃Ü×Ý ƒ#ÃÝòòÚ  Ú2Ú  ÚóóÝ  Ý×  ×€€The€contract€was€on€the€standard€form€used€by€the€realtor€forÐ ¬ü  Ðthe€Pitzes€and€was€prepared€by€the€Pitzesðð€realtor.€€The€contract€contained€the€following€provision,Ð ˜è  Ðreferred€to€as€the€ð ðas€isðð€clause:Ð „Ô  ÐÌà8  àò ò11.€€PROPERTY€INSPECTION.€ó ó€BUYER€may€inspect€the€property,€or€BUYERÐ \¬ Ðmay€contact€a€qualified€inspector€of€BUYERððs€choice€at€BUYERððs€expense€to€obtainÐ Lœ Ðany€inspections€of€electrical€and€mechanical€equipment,€or€for€a€structural€inspectionÐ 8ˆ Ðof€the€property.€€All€such€inspections€shall€be€made€during€normal€working€hoursÐ $t Ðafter€acceptance€of€this€agreement,€and€a€copy€of€any€written€inspection€report€shallÐ ` Ðbe€delivered€to€the€SELLERððS€AGENT€within€10€days€after€acceptance€of€thisÐ üL ÐAgreement.€€SELLER€shall€cause€all€utilities€to€be€operational€so€that€BUYER€mayÐ è8 Ðcomplete€such€inspections.€€If€BUYER€does€not€deliver€a€written€statementÐ Ô$ Ðspecifying€any€items€shown€in€the€inspection€report€which€are€unacceptable€withinÐ À Ð12€days€after€acceptance€of€this€Agreement,€the€property€shall€be€deemed€acceptableÐ ¬ü Ðto€BUYER.€€If€the€inspection€report€reveals€a€material€problem€or€problems€affectingÐ ˜è Ðthe€structural€soundness€or€mechanical/electrical€equipment€of€the€property,€thenÐ „Ô Ðeither€SELLER€or€BUYER€may€terminate€this€Agreement€by€delivering€a€writtenÐ pÀ Ðstatement€to€the€other€party€within€12€days€after€acceptance€of€this€Agreement.Ð\ ¬Ð Ð  ÐÌà8  àò òBuyer€understands€and€agrees€that€by€waiving€the€right€to€inspect€the€property,Ð 4"„  ÐBUYER€accepts€the€property€ð ðas€isðð€without€exception,€excluding€Item€10.€Ð  #p! ÐBUYER€understands€and€agrees€that€inspections€required€by€FHA,€VA,€orÐ  $\" ÐBUYERððS€lender€do€not€necessarily€eliminate€the€need€for€other€inspectionsó ó.Ðø$H #Ð Ð  Ðà8  àÐè%8!$Ð Ð  Ðà8  àAll€of€the€SELLERððS€responsibility€in€connection€with€this€paragraph€shall€cease€atÐ ° Ðclosing,€and€closing€shall€constitute€the€BUYERððS€acceptance€of€the€property,€itsÐ œì Ðmechanical€equipment,€and€other€improvements€to€the€property€in€their€existingÐ ˆØ Ðcondition€(unless€otherwise€specified€in€writing).€.€.€.€ÐtÄÐ Ð  ÐÌThus,€under€the€terms€of€the€contract,€the€Pitzes€were€permitted€to€inspect€the€property€or€hire€aÐ L œ Ðprofessional€inspector€to€inspect€the€property€and€submit€to€the€Woodruffs€a€statement€of€anyÐ 8 ˆ Ðunacceptable€items.€€If€no€such€statement€were€submitted,€the€property€would€be€ð ðdeemedÐ $ t Ðacceptableðð€to€the€Pitzes,€and€the€Pitzes€would€agree€to€accept€the€property€ð ðas€is.ðð€€On€April€30,Ð  ` Ð2000,€the€Pitzes€signed€the€Tennessee€disclosure€form€that€had€been€filled€out€by€the€Woodruffs,Ð ü L  Ðacknowledging€that€they€had€received€it.Ð è 8  ÐÌà  àThough€the€Pitzesðð€real€estate€agent€recommended€that€they€retain€a€professional€buildingÐ À  Ðinspector,€they€did€not€do€so.€€Mr.€Pitz€was€an€employee€of€General€Electric,€where€he€was€a€groundsÐ ¬ü  Ðand€buildings€superintendent,€taking€care€of€all€buildings,€grounds,€and€roofs.€€Consequently,€he€hadÐ ˜è  Ðconsiderable€building€experience.€€Nevertheless,€after€the€sales€contract€was€executed,€the€Pitzes€didÐ „Ô  Ðnot€inspect€the€property€again.€€On€July€6,€2000,€the€day€before€closing,€the€Pitzes€moved€into€theÐ pÀ Ðhouse,€and€spent€their€first€night€there.€€Mr.€Pitz€did€not€inspect€the€house€the€day€they€moved€in.€Ð \¬ ÐThe€closing€was€completed€on€July€7,€2000.׃×Ý ƒ#ÃÝòòÚ  Ú3Ú  ÚóóÝ  Ý×  ×Ð H˜ ÐÌà  àAfter€living€in€the€house€for€some€time,€the€Pitzes€encountered€a€number€of€problems.€Ð  p ÐConsequently,€on€April€6,€2001,€the€Pitzes€filed€the€complaint€in€the€trial€court€below,€assertingÐ  \ Ðclaims€against€the€Woodruffs€for€fraudulent€misrepresentation,€fraudulent€non„disclosure€of€materialÐ øH Ðdefects,€and€fraudulent€concealment€of€certain€alleged€defects.Ð ä4 ÐÌà  àThe€complaint€detailed€many€of€the€claimed€defects.€€Some€of€the€allegations€related€to€aÐ ¼  Ðbrick€porch€that€was€added€to€the€house€by€Mr.€Woodruff€without€the€assistance€of€a€professionalÐ ¨ø Ðcontractor.€€The€brick€porch€was€built€just€outside€double€doors€in€the€master€bedroom€on€the€secondÐ ”ä Ðfloor€(middle)€of€the€house,€just€above€a€den€referred€to€as€a€ð ðrec€room.ðð€€The€complaint€alleged€thatÐ €Ð Ðwater€from€the€porch€leaked€into€the€rec€room,€causing€damage€to€the€roomððs€walls€and€ceiling.€Ð l¼ ÐOther€allegations€related€to€a€wooden€deck,€also€built€by€Mr.€Woodruff,€that€was€situated€around€theÐ X ¨ Ðfront€of€the€house€adjacent€to€the€brick€porch.€€The€complaint€alleged€that€the€foundation€of€the€deckÐ D!” Ðwas€completely€enclosed€with€no€drainage,€and€that€the€build„up€of€water€underneath€the€deckÐ 0"€  Ðcompromised€the€foundation€of€the€house.€€The€complaint€also€referred€to€a€fence€that€lay€acrossÐ #l! Ðboundary€of€the€neighborððs€property€(ð ðfence€issueðð),€defective€furnace€and€air€conditioning€unitsÐ $X" Ðâ â(ð ðfurnace/air€conditioningðð),€and€permanent€stains€on€six€thermopane€windows€due€to€a€leakyÐ ô$D # Ðheating€element€(ð ðinsulating€element€leakðð).€€The€Pitzes€also€alleged€that€they€relied,€to€theirÐ ° Ðdetriment,€on€the€Woodruffsðð€representations€in€the€Tennessee€disclosure€form.׃ ×Ý ƒ#ÃÝòòÚ  Ú4Ú  ÚóóÝ  Ý×  ×Ð œì Ðâ âÌà  àA€bench€trial€was€held€on€February€20€and€22,€2003.€€In€view€of€Mr.€Pitzððs€expertise€andÐ tÄ Ðbuilding€experience,€he€was€qualified€as€an€expert€for€trial€and€testified€as€both€an€expert€and€as€aÐ `° Ðfact€witness.€€He€testified€about€the€alleged€defects€on€the€property€as€well€as€the€WoodruffsððÐ L œ Ðrepresentations€regarding€those€defects.€€Mr.€Pitz€said€that,€on€April€19,€2000,€when€he€first€visitedÐ 8 ˆ Ðthe€house,€he€saw€no€defects.€€On€the€second€visit,€he€related,€when€he€and€Mrs.€Pitz€were€downstairsÐ $ t Ðin€the€rec€room€with€Mr.€Woodruff,€he€saw€a€small€door€that€led€to€the€space€underneath€the€deckÐ  ` Ðin€the€front€of€the€house.€€It€was€a€screen€door,€but€a€black€piece€of€rubber€material€had€been€placedÐ ü L  Ðbehind€the€screen€blocking€the€view€of€the€area€under€the€door.€€Mr.€Pitz€testified€that,€when€heÐ è 8  Ðasked€Mr.€Woodruff€about€what€was€behind€the€door,€Mr.€Woodruff€discouraged€him€from€lookingÐ Ô$  Ðunder€the€door,€telling€him€ð ðit€goes€under€the€deck.€.€.€.€[T]hereððs€nothing€in€there€that€would€concernÐ À  Ð[you],€thereððs€no€problems€in€there.ðð€€Ð ¬ü  ÐÌà  àMr.€Pitz€testified€further€that,€as€he€and€Mr.€Woodruff€were€walking€around€the€outside€ofÐ „Ô  Ðthe€house,€he€asked€Mr.€Woodruff€about€a€five„foot€crack€he€saw€in€a€brick€wall€that€supported€theÐ pÀ Ðfoundation€of€the€deck.€€Mr.€Pitz€said€that€Mr.€Woodruff€told€him€that€the€crack€was€the€result€ofÐ \¬ Ðnormal€expansion€and€contraction€or€settling€of€the€house.€€Mr.€Pitz€said€that€he€accepted€Mr.Ð H˜ ÐWoodruffððs€explanation.€Ð 4„ ÐÌà  àMr.€Pitz€testified€that,€after€he€and€Mrs.€Pitz€had€lived€in€the€house€for€a€short€time,€heÐ  \ Ðbecame€curious€about€what€was€behind€the€screen€door€that€led€underneath€the€deck.€€He€said€thatÐ øH Ðhe€took€a€chisel,€broke€the€screen,€and€removed€a€door€in€order€to€get€access€to€the€area.€€HeÐ ä4 Ðdiscovered€what€he€described€as€a€big€ð ðswampðð€under€the€deck.€€The€water€from€the€gutters€on€theÐ Ð  Ðhouse€was€channeled€under€the€deck,€in€addition€to€the€water€that€drained€directly€through€the€deck.€Ð ¼  ÐAll€of€the€water€collected€under€the€deck€because€there€was€no€drainage€system€going€out.€€This€lackÐ ¨ø Ðof€drainage,€Mr.€Pitz€said,€threatened€the€stability€of€the€foundation€of€the€house.€€Mr.€Pitz€statedÐ ”ä Ðthat,€from€under€the€deck,€he€saw€the€other€side€of€the€cracked€brick€wall,€and€that€the€entire€cornerÐ €Ð Ðof€the€wall€ð ðwas€all€just€falling€apart.ðð€€He€said€that€he€could€see€other€walls€that€also€had€cracks,€andÐ l¼ Ðit€seemed€that€the€whole€foundation€was€ð ðgiving€away€and€causing€that€wall€to€crack,€and€part€of€itÐ X ¨ Ðwas€even€leaning€out€about€an€inch€or€so.ðð€€To€remedy€the€situation,€Mr.€Pitz€said€he€had€to€installÐ D!” Ðtwo€four„inch€drains.€€To€do€so,€he€paid€a€worker€$300€to€help€him€dig€out€the€lower€part€of€theÐ 0"€  Ðfoundation€on€the€inside€and€break€through€the€wall€in€two€places€under€the€deck.€€His€own€work€onÐ #l! Ðthe€drainage€system,€Mr.€Pitz€stated,€was€worth€about€$1,800,€estimating€that€he€spent€about€120Ð $X" Ðhours€working€on€it€at€a€rate€of€$15€per€hour.Ð ô$D # ÐÌà  àDuring€the€PitzesððApril€tour€of€the€house,€Mr.€Pitz€asserted,€Mr.€Woodruff€showed€him€theÐ Ì&"% Ðcarpeted,€finished€room€in€the€basement€and€the€nearby€area€where€the€furnace,€two€hot€waterÐ ¸'#& Ðheaters,€and€a€central€vacuum€system€were€located.€€Behind€a€small€door€under€the€stairs€going€downÐ ¤(ô#' Ðto€the€basement€was€a€four„foot€by€five„foot€sump€with€water€in€it.€€Mr.€Pitz€said€that€he€observedÐ ° Ðthat€the€sump€had€in€it€a€four„inch€drain€and€another€one„inch€drain.€€He€said€that€€Mr.€WoodruffÐ œì Ðexplained€to€him€that,€after€he€installed€a€beaver€board€system€(described€as€an€indoor€gutter)€toÐ ˆØ Ðfacilitate€draining,€he€had€no€problems€with€the€sump€drain.€€Mr.€Pitz€testified€that€he€could€notÐ tÄ Ðcrawl€under€the€stairs€easily,€so€he€did€not€see€how€the€area€was€draining.€Ð `° ÐÌà  àThe€first€rain€after€the€Pitzes€had€moved€into€the€house€revealed€further€problems.€€After€theÐ 8 ˆ Ðrain,€it€became€apparent€that€there€was,€in€fact,€a€problem€with€the€sump€drain€because€the€carpet€inÐ $ t Ðthe€basement€became€wet.€€Mr.€Pitz€said€that€the€water€overflowed€from€the€sump,€which€indicatedÐ  ` Ðthat€the€water€was€not€properly€draining€from€the€sump.€€ò òó óMr.€Pitz€observed€that,€when€he€and€hisÐ ü L  Ðwife€had€toured€the€house,€neither€of€them€had€seen€a€dehumidifier€in€the€basement.€€Two€days€afterÐ è 8  Ðclosing,€however,€the€Woodruffs€told€the€Pitzes€that€they€would€need€a€large€dehumidifier€for€theÐ Ô$  Ðbasement,€and€offered€to€lend€the€Pitzes€their€dehumidifier€until€they€could€get€one€for€themselves.€Ð À  ÐThe€Pitzes€maintained€that€this€showed€that€the€Woodruffs€knew€that€there€was€a€water€problem€inÐ ¬ü  Ðthe€basement.€€Mr.€Pitz€said€that€he€paid€$350€to€Kenneth€Edwards€(ð ðEdwardsðð),€who€had€ten€yearsÐ ˜è  Ðof€backhoe€experience,€to€help€him€unclog€the€sump€drain.€€Edwards€testified€at€trial€that€the€four„Ð „Ô  Ðinch€pipe€in€the€sump€did€not€go€outside€the€house,€that€the€concrete€had€it€sealed€off,€and€that€theÐ pÀ Ðone„inch€pipe€was€not€functioning€because€it€was€clogged€with€mud.€€Mr.€Pitz€testified€thatÐ \¬ Ðremedying€the€sump€problem€required€him€to€take€twenty€hours€or€two€days€to€break€through€theÐ H˜ Ðfoundation€and€install€a€new€drainage€line.€€Mr.€Pitz€estimated€that€his€own€services€in€fixing€theÐ 4„ Ðsump€problem€were€valued€at€$300€(20€hours€at€$15€per€hour).Ð  p Ѐ€Ð  \ Ðà  àMr.€Pitz€testified€that€the€first€rain€revealed€another€water€problem.€€Rain€leaked€from€theÐ øH Ðbedroom€doors€leading€to€the€brick€porch€down€onto€the€floor€of€the€rec€room.€€The€leak€resultedÐ ä4 Ðfrom€the€fact€that€the€doors€had€no€flashing€around€them€to€keep€water€from€seeping€down.€€Mr.€PitzÐ Ð  Ðasserted€that€the€Woodruffs€had€concealed€the€problem€by€painting€over€water€stains€on€the€ceilingÐ ¼  Ðof€the€rec€room€prior€to€the€closing.Ð ¨ø ÐÌà  àIn€his€deposition,€Mr.€Woodruff€said€that€he€had€had€trouble€with€this€same€leak€for€severalÐ €Ð Ðyears€after€the€deck€was€built€in€either€1990€or€1991.€€He€acknowledged€that€the€moisture€from€theÐ l¼ Ðleak€caused€part€of€the€sheetrock€tape€in€the€wall€of€the€rec€room€to€pull€loose€and€left€a€stain€by€theÐ X ¨ Ðtape.€€However,€he€characterized€the€leak€as€minor,€and€said€that€it€did€not€cause€any€permanentÐ D!” Ðdamage€to€the€house.€€Mr.€Woodruff€claimed€that,€in€1997,€he€fixed€the€leak€by€putting€a€new€layerÐ 0"€  Ðof€polymeric€matting€over€the€threshold€of€the€doors€and€running€it€up€walls€of€the€master€bedroomÐ #l! Ðabout€seven€inches.׃×Ý ƒ#ÃÝòòÚ  Ú5Ú  ÚóóÝ  Ý×  ×€€He€asserted€that€these€measures€fixed€the€problem,€and€consequently€he€did€notÐ $X" Ðmentioned€it€to€the€Pitzes.€€Mr.€Woodruff€conceded€that€he€painted€over€the€stain€before€closing,€butÐ ô$D # Ðexplained€that€he€did€€that€so€the€Pitzes€would€have€ð ðan€aesthetic,€pleasing€entrance€to€the€house€andÐ à%0!$ Ðnot€have€to€do€any€extra€work€on€the€house.ððÐ Ì&"% Ðà  àMr.€Pitz€tried€to€fix€the€leak€from€the€bedroom€doors€by€caulking€the€threshold,€with€noÐ ° Ðsuccess.€€He€contacted€Scotty€Wallace,€a€contractor,€who€estimated€that€it€would€cost€$40,000€to€fixÐ œì Ðthe€leak.€€Wallace€suggested€that€a€more€cost„effective€solution€would€be€to€put€a€roof€over€the€topÐ ˆØ Ðof€the€brick€porch€and€screen€it€in.€€The€Pitzes€took€this€suggestion€and€hired€Darrell€Pragel€to€helpò òó óÐ tÄ ÐMr.€Pitz€build€the€roof€over€the€porch€and€screen€it€in,€for€which€they€paid€approximately€$8,450€inÐ `° Ðlabor€and€$7,267€in€materials.€€Mr.€Pitz€stated€that€he€spent€about€160€hours€on€the€project,€and€heÐ L œ Ðvalued€his€services€at€$2,400€(160€hours€at€$15€per€hour).€Ð 8 ˆ ÐÌ€€€€€€à  àPitz€also€testified€about€a€problem€with€the€houseððs€thermopane€doors.€€He€said€that,€on€oneÐ  ` Ðof€the€days€he€was€at€the€house€in€April,€he€ate€lunch€on€the€second€floor€near€four€of€the€thermopaneÐ ü L  Ðdoors.€€The€windows€in€the€doors€appeared€dirty.€€Mr.€Pitz€said€that,€about€€a€week€and€a€half€afterÐ è 8  Ðthey€took€possession€of€the€house,€they€tried€unsuccessfully€to€clean€the€windows€on€the€thermopaneÐ Ô$  Ðdoors.€€They€later€determined€that€the€windows€could€not€be€cleaned€because€the€insulating€elementÐ À  Ðin€the€windows€had€leaked€out€and€moisture€had€condensed€on€the€inside€of€the€windows.€€In€Mrs.Ð ¬ü  ÐWoodruffððs€deposition,€she€acknowledged€that€the€windows€began€to€ð ðfog€upðð€about€three€or€fourÐ ˜è  Ðyears€prior€to€the€sale.€€When€asked€whether€she€disclosed€this€fact€to€the€Pitzes,€Mrs.€WoodruffÐ „Ô  Ðreplied,€ð ðI€didnððt€think€it€was€necessary.€€It€was€quite€obvious.€€There€were€no€drapes,€no€curtains.ðð€Ð pÀ ÐA€total€of€six€thermopane€windows€in€the€house€were€replaced€at€a€cost€of€$975.€€Ð \¬ ÐÌ€€€€€€€€€à  àMr.€Pitz€also€testified€that€the€first€time€he€tried€to€use€the€furnace,€it€did€not€work.€Ð 4„ ÐUltimately,€he€said,€the€entire€unit€had€to€be€replaced€at€a€cost€of€$3,400.€€€€€€€€€€Ð  p ÐÌà  àFinally,€Mr.€Pitz€testified€that,€two€days€before€the€closing,€Mr.€Woodruff€called€him€and€toldÐ øH Ðhim€that€part€of€a€fence€running€along€the€property€was€actually€on€the€neighborððs€property,€andÐ ä4 Ðoffered€to€later€help€Mr.€Pitz€move€the€fence.€€Mr.€Pitz€said€that€Mr.€Woodruff€did€not€help€moveÐ Ð  Ðthe€fence,€however,€and€Mr.€Pitz€paid€a€worker€$600€to€help€him€move€the€fence€and€paid€$341€forÐ ¼  Ðmaterials€to€complete€the€job.€Ð ¨ø ÐÌà  àMr.€Woodruff€also€testified€at€trial.€€He€acknowledged€that€there€had€been€some€waterÐ €Ð Ðproblems€with€the€house,€but€maintained€that€he€had€corrected€those€problems.€€Mr.€Woodruff€saidÐ l¼ Ðhe€was€aware€of€the€leak€in€the€doors€of€the€master€bedroom€that€led€outside€to€the€brick€porch,€butÐ X ¨ Ðasserted€that€he€fixed€it€by€putting€polymeric€matting€over€the€threshold€of€the€door.€€He€admittedÐ D!” Ðthat€the€leak€had€caused€stains€on€the€ceiling€in€the€rec€room,€and€that€he€painted€the€stainsÐ 0"€  Ðimmediately€before€closing.€€He€claimed,€however,€that€he€painted€the€area€only€for€aestheticÐ #l! Ðpurposes.Ð $X" ЀÌà  àMr.€Woodruff€testified€that€he€had€never€had€a€problem€with€the€sump€water€overflowing€andÐ à%0!$ Ðflooding€the€carpet€in€the€basement.€€He€maintained€that€the€beaver€board€system€that€he€builtÐ Ì&"% Ðdrained€the€water,€and€then€directed€the€water€from€the€sump€to€the€outside€of€the€house.€Ð ¸'#& ÐÌà  àWith€respect€to€the€damage€caused€by€the€lack€of€drainage€under€the€deck,€Mr.€WoodruffÐ )à$( Ðâ âadmitted€that€the€water€from€the€gutters€was€channeled€underneath€the€deck,€and€although€the€deckÐ |*Ì%) Ðwas€completely€enclosed,€it€had€no€drainage€system€underneath€it.€€He€said€he€had€never€been€underÐ ° Ðthe€deck,€and€therefore€had€no€knowledge€of€any€problems€from€the€collection€of€water€in€that€area.€Ð œì Ðâ âÌà  àMr.€Woodruff€claimed€no€knowledge€of€any€defects€in€the€furnace€and€air€conditioning€units.€Ð tÄ ÐHe€said€that€the€furnace€and€air€conditioning€units€were€twelve€years€old,€and€that€they€had€beenÐ `° Ðinspected€regularly€and€were€working€properly€when€the€house€was€sold.€€As€for€the€thermopaneÐ L œ Ðdoors,€€Mr.€Woodruff€testified€that€he€and€Mrs.€Woodruff€knew€the€windows€were€fogged.€€It€wasÐ 8 ˆ Ðunclear€whether€either€of€them€were€aware€of€any€insulating€element€leak€that€could€have€affectedÐ $ t Ðthe€windows€in€the€doors.€€Mr.€Woodruff€noted€that€he€and€the€Pitzes€had€lunch€near€the€doors,€andÐ  ` Ðthat€the€fogged€windows€were€in€plain€view.Ð ü L  ÐÌà  àWith€respect€to€the€fence€issue,€Mr.€Woodruff€stated€that€he€assumed€that€Mr.€Pitz€would€tryÐ Ô$  Ðto€ð ðstraighten€outðð€the€problem€with€the€neighbor.€€If€that€did€not€work,€Mr.€Woodruff€stated,€he€wasÐ À  Ðprepared€to€help€Mr.€Pitz€move€the€fence.€€However,€after€the€closing,€Mr.€Woodruff€was€neverÐ ¬ü  Ðcontacted€by€Mr.€Pitz€regarding€the€fence.Ð ˜è  ÐÌà  àMrs.€Woodruff€corroborated€much€of€Mr.€Woodruffððs€testimony.€€She€said€that,€when€theÐ pÀ Ðhouse€was€built,€they€experienced€some€slight€leaking€in€the€rec€room€when€it€rained,€butÐ \¬ Ðcharacterized€it€as€ð ðonly€a€trickle,€it€was€not€a€drip€or€a€leak.ðð€€She€denied€that€the€leak€ever€causedÐ H˜ Ðð ðdamageðð€to€the€ceiling€of€the€rec€room,€but€acknowledged€that€it€resulted€in€ð ð[a]€normal€small€waterÐ 4„ Ðstainðð€where€the€water€came€down.€€Mrs.€Woodruff€said€that€Mr.€Woodruff€painted€over€the€smallÐ  p Ðstain,€just€as€he€did€every€other€imperfection€in€the€walls,€in€order€to€leave€the€house€ð ðnice€and€cleanððÐ  \ Ðfor€the€Pitzes€to€move€in.€€She€said€it€was€not€a€conscious€attempt€to€hide€anything.€€She€did€not€feelÐ øH Ðthat€it€was€necessary€to€disclose€to€the€Pitzes€the€leak,€the€fogged€thermopane€windows,€or€any€otherÐ ä4 Ðobvious€problems.Ð Ð  ÐÌà  àAdditional€witnesses€were€called€to€testify€to€corroborate€Mr.€Pitzððs€and€the€WoodruffsððÐ ¨ø Ðversion€of€the€facts.€€Other€witnesses€testified€with€respect€to€damages.€€At€the€conclusion€of€the€trial,Ð ”ä Ðthe€trial€court€took€the€case€under€advisement.€Ð €Ð ÐÌà  àOn€June€30,€2003,€the€trial€court€issued€a€memorandum€opinion€finding€in€favor€of€theÐ X ¨ ÐWoodruffs.€€The€trial€court€noted€at€the€outset€that€the€Pitzes€were€bound€by€the€sales€contract€thatÐ D!” Ðgoverned€the€transaction€up€to€the€closing.€€As€an€initial€matter,€the€trial€court€determined€that€theÐ 0"€  Ðdisclosure€form€in€and€of€itself€did€not€impose€liability€on€the€Woodruffs,€because€Tennessee€CodeÐ #l! ÐAnnotated€ðð€66„5„201,€òòet€seq.óó,€disallows€a€suit€based€on€the€representations€in€the€disclosure€formÐ $X" Ðalone,€and€the€disclosure€form€is€not€a€warranty.€€Next,€the€trial€court€concluded€that€the€WoodruffsÐ ô$D # Ðhad€made€some€misrepresentations€of€fact.€€The€trial€court€€found:Ð à%0!$ ÐÌà8  à[I]t€is€clear€that€some€false€representations€were€made.€€The€representationsÐ ¸'#& Ðconcerning€the€thermo€pane€windows€is€the€best€example[.]€The€representation€thatÐ ¤(ô#' Ðthe€defendants€would€help€in€the€moving€of€the€fence€is€another.€€The€discouragementÐ )à$( Ðof€the€plaintiffs€going€behind€the€screen€under€the€deck€to€keep€from€getting€dirtyÐ |*Ì%) Ðcould€be€seen€as€another€effort€to€hide€a€potential€problem.Ðh+¸&*Ð Ð  ЀÌà8  à€€€€€€€The€representation€concerning€the€windows€was€made€knowingly.€€TheÐ œì Ðdefendants€knew€the€thermo€pane€windows€were€fogged€up.€€The€defendants€knewÐ ˆØ Ðthey€had€previous€water€problems€and€they€agreed€to€help€move€the€fence.€€TheÐ tÄ Ðdefendants€knew€that€the€deck€foundation€wall€offered€no€outlet,€even€though€theyÐ `° Ðhad€no€problems€with€drainage.ÐL œÐ Ð  ÐÌIt€went€on€to€hold,€however,€that€the€Pitzesðð€reliance€on€the€representations€of€the€Woodruffs€wasÐ $ t Ðnot€reasonable.€€The€trial€court€reasoned:Ð  ` ÐÌà8  à€€€€€The€overarching€question€is€whether€the€plaintiffs€reasonably€relied€on€theÐ è 8  Ðrepresentations€of€the€defendants.€€These€representations€clearly€preceded€the€contractÐ Ô$  Ðsigning.€€How€could€the€plaintiffs€believe€that€they€were€entitled€to€rely€on€theÐ À  Ðrepresentations€in€light€of€the€contract€language?€€The€language€of€the€contract€placedÐ ¬ü  Ðthem€on€notice€that€they€should€not€rely€on€the€representations€of€the€sellers€and€thatÐ ˜è  Ðthey€were€buying€the€property€ð ðas€is.ðð€€In€light€of€the€contract€language€it€is€notÐ „Ô  Ðreasonable€to€rely€on€the€representations€of€the€sellers.€€Therefore€the€fraud€claimÐ pÀ Ðmust€fail.€Ð\¬Ð Ð  ÐÌà@VV)ìà***ˆÐ 4„ ÐÌà8  à€€€€€The€testimony€of€those€to€be€bound€by€the€real€estate€contract€was€taken€at€trial.€Ð  \ ÐNeither€of€the€plaintiffs€appeared€to€be€under€any€disability€that€would€prevent€themÐ øH Ðfrom€reasonably€understanding€the€import€of€the€provisions€of€the€contract€they€wereÐ ä4 Ðsigning€which€gave€them€the€right€to€have€the€property€inspected.€€The€plaintiffsÐ Ð  Ðknowingly€waived€that€right€by€not€having€an€inspection€performed.€€Further,€givenÐ ¼  Ðthe€expertise€of€Mr.€Pitz,€the€defects€complained€of€should€have€reasonably€revealedÐ ¨ø Ðthemselves€and€caused€him€not€to€close€on€the€house€until€those€areas€of€concernÐ ”ä Ðwere€addressed.€€The€plaintiffs€had€free€reign€[sic]€and€possession€of€the€property€andÐ €Ð Ðan€ample€opportunity€to€inspect€the€property€prior€to€closing.Ðl¼Ð Ð  Ðà  à€€€€€€€€€€€€€€€€Ð X ¨ ÐThus,€the€trial€court€based€its€decision€first€on€the€ð ðas€isðð€provision€in€the€contract.€€It€also€based€itsÐ D!” Ðdecision€on€its€conclusion€that€the€Pitzes€should€have€been€aware€of€the€alleged€defects€in€light€ofÐ 0"€  ÐMr.€Pitzððs€expertise€and€their€ð ðfree€rein€and€possession€of€the€property€and€.€.€.€ample€opportunityÐ #l! Ðto€inspect€the€property€prior€to€closing.ðð׃×Ý ƒ#ÃÝòòÚ  Ú6Ú  ÚóóÝ  Ý×  ×€€Thus,€the€trial€court€concluded€that€there€was€no€actionableÐ $X" Ðfraud.€€Consequently,€it€held€that€the€contract€merged€into€the€deed,€and€that€no€conditions€or€furtherÐ ô$D # Ðâ âwarranties€were€made€in€the€deed.€€On€July€11,€2003,€the€trial€court€entered€an€order€consistent€withÐ à%0!$ Ðthe€memorandum€opinion€dismissing€the€action€against€the€Woodruffs.€€From€this€order,€the€PitzesÐ ° Ðnow€appeal.Ð œì Ðâ âÌà  àOn€appeal,€the€Pitzes€argue€that€the€trial€court€erred€in€finding€that€their€reliance€on€theÐ tÄ ÐWoodruffsðð€representations€was€not€reasonable.€€They€assert€that€the€trial€court€misapplied€the€lawÐ `° Ðto€the€facts€of€the€case,€because€the€ð ðas€isðð€clause€in€the€contract€does€not€prevent€them€fromÐ L œ Ðrecovering€damages€for€material€defects€in€the€house€when€the€defects€were€known€to€the€Woodruffs.€Ð 8 ˆ ÐòòóóThe€ð ðas€isðð€language,€they€argue,€allocates€to€the€buyers€only€the€risk€of€òòunknownóó€defects.€€òòò òó óóóTheyÐ $ t Ðmaintain€that€the€contract€did€not€merge€into€the€deed€because€the€Woodruffs€committed€fraud.Ð  ` ÐÌà  àBecause€this€case€was€tried€by€the€trial€court€without€a€jury,€the€trial€courtððs€findings€of€factÐ è 8  Ðare€reviewed€òòde€novoóó€on€the€record,€with€a€presumption€that€those€findings€are€correct,€unless€theÐ Ô$  Ðevidence€preponderates€otherwise.€€ò òòòUnion€Carbide€Corp.€v.€Huddlestonó óóó,€854€S.W.2d€87,€91€(Tenn.Ð À  Ð1993);€Tenn.€R.€App.€P.€13(d).€€The€trial€courtððs€conclusions€of€law€are€reviewed€òòde€novoóó,€with€noÐ ¬ü  Ðpresumption€of€correctness.Ô#†XúœXXXúœ=#Ô€€ò òòòSeeóóó ó€òòò òState€v.€Levandowskió óóó,€955€S.W.2d€603,€604€(Tenn.€1997)Ô‡XúœXXXúœÔ.€€ð ðOurÐ ˜è  Ðòòde€novoóó€review€is€tempered€by€the€well„established€rule€that€the€trial€court€is€in€the€best€position€toÐ „Ô  Ðassess€the€credibility€of€the€witnesses;€accordingly,€such€credibility€determinations€are€entitled€toÐ pÀ Ðgreat€weight€on€appeal.ðð€€ò òòòMurvin€v.€Coferó óóó,€968€S.W.2d€304,€306€(Tenn.€Ct.€App.€1997).Ð \¬ ÐÌà  àIn€order€to€prove€a€claim€based€on€fraudulent€misrepresentation,€the€plaintiff€must€prove€that:€Ð 4„ Ð(1)€the€defendant€made€a€representation€of€an€existing€or€past€fact;€(2)€the€representation€was€falseÐ  p Ðwhen€made;€(3)€the€representation€related€to€a€material€fact;€(4)€the€false€representation€was€madeÐ  \ Ðeither€knowingly€or€without€belief€in€its€truth€or€recklessly;€(5)€the€plaintiff€reasonably€relied€on€theÐ øH Ðmisrepresented€material€facts;€and€(6)€the€plaintiff€suffered€damage€as€a€result€of€theÐ ä4 Ðmisrepresentation.€€ò òòòMetropolitan€Govððt€of€Nashville€and€Davidson€County€v.€McKinneyó óóó,€852Ð Ð  ÐS.W.2d€233,€237€(Tenn.€Ct.€App.€1992);€ò òòòsee€Anderson€v.€Warrenó óóó,€W2000„02649„COA„R3„CV,Ð ¼  Ð2001€WL€1683810,€at€*3€(Tenn.€Ct.€App.€Dec.€12,€2001).€€In€such€an€action,€the€burden€is€upon€theÐ ¨ø Ðplaintiff€to€show€that€his€reliance€on€the€defendantððs€representation€was€reasonable.€€ò òòòMetropolitanÐ ”ä ÐGovððt€of€Nashville€&€Davidson€Countyó óóó,€852€S.W.2d€at€237.òòò ò€€óóó óÐ €Ð ÐÌà  àA€party€may€be€held€liable€for€concealing€or€failing€to€disclose€a€material€fact€to€the€sameÐ X ¨ Ðextent€that€the€party€may€be€held€liable€for€intentional€misrepresentation.€€ò òòòSee€Patel€v.€Bayliffó óóó,€121Ð D!” ÐS.W.3d€347,€352„53€(Tenn.€Ct.€App.€2003).€€To€establish€a€claim€based€on€fraudulent€concealmentÐ 0"€  Ðor€fraudulent€non„disclosure,€the€plaintiff€must€show€that€(1)€the€defendant€had€knowledge€of€aÐ #l! Ðmaterial€existing€fact€or€condition,€and€that€(2)€the€defendant€had€a€duty€to€disclose€the€fact€orÐ $X" Ðcondition.€€ò òòòLonning€v.€Jim€Walter€Homes,€Inc.ó óóó,€725€S.W.2d€682,€685€(Tenn.€Ct.€App.€1986).€€InÐ ô$D # Ðthe€sale€of€real€property,€a€fact€or€condition€is€ð ðmaterialðð€if€it€is€one€of€ð ðcontrolling€importance€inÐ à%0!$ Ðdetermining€the€desirability€and€value€of€th[e]€residence.ðð€€ò òòòPatelóóó ó,€121€S.W.3d€at€353€(quotingÐ Ì&"% Ðò òòòSimmonsó óóó,€206€S.W.2d€at€296).€€€The€defendant€has€a€duty€to€disclose€such€a€fact€or€condition€ð ðunlessÐ ¸'#& Ðordinary€diligence€would€have€revealed€the€undisclosed€fact.ðð€€ò òòòLonningó óóó,€725€S.W.2d€at€685€(citingÐ ¤(ô#' Ðò òòòSimmons€v.€Evansó óóó,€206€S.W.2d€295,€296€(Tenn.€1947)).€€Thus,€there€is€no€duty€to€disclose€aÐ )à$( Ðâ âmaterial€fact€or€condition€if€it€was€apparent€through€ð ðcommon€observationðð€or€if€it€would€have€beenÐ |*Ì%) Ðdiscoverable€through€the€exercise€of€ordinary€diligence.€€ò òòòSimmonsó óóó,€206€S.W.2d€at€297;€ò òòòPateló óóó,€121Ð ° ÐS.W.3d€at€353.Ð œì Ðâ âÌà  àIn€outlining€its€decision,€the€trial€court€below€did€not€distinguish€between€the€Pitzesðð€claimsÐ tÄ Ðbased€on€fraudulent€misrepresentation€and€those€based€on€fraudulent€concealment€or€non„disclosure.€Ð `° ÐThe€trial€court€instead€based€its€decision€on€its€finding€that€the€Pitzesðð€reliance€on€the€WoodruffsððÐ L œ Ðrepresentations€was€not€reasonable.€€On€appeal,€the€Pitzes€argue€that€the€trial€court€erred€in€basingÐ 8 ˆ Ðits€conclusion€on€the€ð ðas€isðð€language€in€the€contract,€because€an€ð ðas€isðð€clause€applies€only€toÐ $ t Ðòòunknown€óódefects,€not€defects€that€were€known€to€the€seller€at€the€time€of€the€sale.€€Ð  ` ÐÌà  àIn€support€of€their€position,€the€Pitzes€cite€òòò òEdmondson€v.€Coatesó óóó,€No.€01„A„01„9109„Ð è 8  ÐCH000324,€1992€WL€108717€(Tenn.€Ct.€App.€May€22,€1992).€€In€ò òòòEdmondsonó óóó,€the€plaintiffÐ Ô$  Ðpurchasers€signed€a€contract€to€purchase€a€home€from€the€defendant€sellers€after€seeing€the€houseÐ À  Ðonce.€€The€sales€contract€included€a€provision€stating€that€the€purchasers€agreed€to€take€the€propertyÐ ¬ü  Ðð ðas€isðð€and€allowed€the€purchasers€to€inspect€the€property€and€to€obtain€an€independent€opinion€onÐ ˜è  Ðthe€property€prior€to€closing.€€ò òòòEdmondsonó óóó,€1992€WL€108717,€at€*1.€€The€purchasers€closed€on€theÐ „Ô  Ðproperty€and€moved€in€without€having€made€any€further€inspection.€€Several€months€after€theyÐ pÀ Ðmoved€in,€the€purchasers€discovered€several€defects€in€the€house€that€the€sellers€had€not€disclosed.׃×Ý ƒ#ÃÝòòÚ  Ú7Ú  ÚóóÝ  Ý×  ׀Р\¬ Ðò òòòId.€óóó óat€*2.€€One€of€the€chimneys€was€pulling€away€from€the€house,€and€the€sellers€had€covered€theÐ H˜ Ðresulting€gaps€with€caulking.€€Cracks€in€the€foundation€walls€had€been€painted€over.€€A€leak€aroundÐ 4„ Ða€shower€on€the€first€floor€had€resulted€in€rotten€floorboards.€€The€floorboards€would€have€beenÐ  p Ðvisible€from€the€basement,€but€the€sellers€had€covered€the€underside€of€the€first€floor€with€insulation.€Ð  \ Ðò òòòId.ó óóó€€During€their€visit€to€the€property,€the€purchasers€had€noticed€water€damage€and€had€asked€theÐ øH Ðreal€estate€agent€whether€the€roof€had€been€leaking.€€The€agent€told€them€that€the€leak€had€been€fixed.€Ð ä4 ÐThe€leak€had€in€fact€not€been€fixed,€and€after€the€first€rain,€the€leak€caused€substantial€damage.€€TheÐ Ð  Ðpurchasers€also€alleged€that€the€real€estate€agent€told€them€that€a€pot„bellied€stove€in€the€kitchenÐ ¼  Ðcould€heat€the€whole€house,€when€in€fact€the€stove€was€strictly€decorative€and€had€never€beenÐ ¨ø Ðconnected€to€the€chimney.€€Finally,€after€the€purchasers€took€possession,€a€rotten€window€frame€thatÐ ”ä Ðhad€been€painted€over€fell€out,€revealing€other€concealed€€rotten€wood.€€ò òòòId.óóó ó.€€Ð €Ð ÐÌà  àThe€purchasers€sued€the€defendant€sellers€for€fraudulent€concealment€of€significant€defectsÐ X ¨ Ðâ âin€the€structure€of€the€house.׃¢×Ý ƒ#ÃÝòòÚ  Ú8Ú  ÚóóÝ  Ý×  ×€€The€trial€court€granted€summary€judgment€in€favor€of€the€defendantÐ D!” Ðsellers,€dismissing€all€claims€against€them.׃×Ý ƒ#ÃÝòòÚ  Ú9Ú  ÚóóÝ  Ý×  ×€€On€appeal,€the€sellers€argued€that€the€ð ðas€isðð€languageÐ ° Ðâ âin€the€contract€protected€them€by€assigning€to€the€purchasers€the€risk€of€any€and€all€defects.€€ò òòòId.ó óóó€atÐ œì Ð*10.€€The€appellate€court€disagreed,€stating€that€the€ð ðas€isðð€clause€in€the€contract€protected€the€sellerÐ ˆØ Ðfrom€liability€for€òòunknown€óódefects,€but€not€from€the€liability€for€defects€about€which€the€seller€knew.€Ð tÄ ÐThe€appellate€court€reasoned:Ð `° ÐÌà8  àAlthough€the€courts€will€enforce€ð ðas€isðð€clauses€allocating€the€risk€of€òòunknownÐ 8 ˆ Ðóódefects€to€the€buyers,€to€do€so€where€the€sellers€knew€about€the€defects€and€withheldÐ $ t Ðmaterial€information€would€be€to€blindly€enforce€a€contract€obtained€by€fraud.€Ð  ` ÐJustice€would€be€poorly€served€if€that€were€the€law€in€Tennessee.€€Happily€it€is€not.€Ð ü L  ÐRather,€the€law€is€as€follows:Ðè 8 Ð Ð  ÐÌà8  àà8` Ð Ð à[E]ach€party€to€a€contract€is€bound€to€disclose€to€the€other€party€all€heÐ À  Ðmay€know€respecting€the€subject€matter€materially€affecting€a€correctÐ ¬ü  Ðview€of€it,€unless€common€observation€would€have€furnished€theÐ ˜è  Ðinformation.Ð„Ô ` x` x ÐÌà8  àòòò òSimmons€v.€Evansó óóó,€185€Tenn.€282,€285„86,€206€S.W.2d€295,€296€(1947)€(quotingÐ \¬ Ðò òòòPerkins€v.€McGavockó óóó,€3€Tenn.€415,€417€(1813));€ò òòòLonning€v.€Jim€Walter€Homesó óóó,Ð H˜ Ð725€S.W.2d€682€(Tenn.€App.€1986).€ÓÕ·ÓÐ4„Ð Ð  ÐÓþ Óò òòòId.ó óóó€at€*11.€€Therefore,€ò òòòEdmondsonó óóó€makes€it€clear€that,€despite€the€existence€of€an€ð ðas€isðð€clause€inÐ  \ Ðthe€sales€contract,€the€seller€is€nevertheless€obligated€to€disclose€any€known€material€defects€in€theÐ øH Ðcondition€of€the€house,€provided€the€defects€are€not€apparent€or€readily€discoverable€through€theÐ ä4 Ðexercise€of€ordinary€diligence.€€ò òòòSee€Godwin€Aircraft,€Inc.€v.€Houstonó óóó,€851€S.W.2d€816,€822€(Tenn.Ð Ð  ÐCt.€App.€1992)€(concluding€that€ð ðas€isðð€disclaimer€in€the€sales€contract€was€not€a€defense€to€a€claimÐ ¼  Ðbased€on€fraudulent€misrepresentation€regarding€the€condition€of€the€aircraft).Ð ¨ø ÐÌà  àIn€the€instant€case,€the€trial€court€found€that€the€Pitzesðð€reliance€on€the€WoodruffsððÐ €Ð Ðmisrepresentations€was€not€reasonable,€in€part€because€of€the€ð ðas€isðð€language€in€the€sales€contract.€Ð l¼ ÐWe€must€note€that€in€ò òòòEdmondsonó óóó,€the€trial€court€had€granted€summary€judgment€to€the€buyer€basedÐ X ¨ Ðon€the€ð ðas€isðð€contractual€provision.€€ò òòòEdmondsonó óóó€says€only€that€an€ð ðas€isðð€provision€in€a€contract€isÐ D!” Ðnot€a€shield€where€the€seller€knew€of€a€defect€and€withheld€the€information€from€the€buyer.€€It€doesÐ 0"€  Ðòònotóó€say€that€the€ð ðas€isðð€provision€cannot€be€considered€òòat€allóó€in€determining€whether€the€buyerððsÐ #l! Ðreliance€on€the€sellerððs€representation€was€reasonable.Ð $X" ÐÌà  àThe€trial€courtððs€decision€in€this€case€was€not€based€solely€on€the€ð ðas€isðð€clause€in€the€salesÐ à%0!$ Ðcontract.€€The€trial€court€also€found€that€the€defects€about€which€the€Pitzes€complained€were€readilyÐ Ì&"% Ðdiscoverable.€€The€trial€court€observed€that,€in€light€of€Mr.€Pitzððs€qualification€as€a€building€expert,Ð ¸'#& Ðð ðthe€defects€complained€of€should€have€reasonably€revealed€themselves€and€caused€[Mr.€Pitz]€notÐ ° Ðto€close€on€the€house€until€those€areas€of€concern€were€addressed.€€The€plaintiffs€had€free€rein€andÐ œì Ðpossession€of€the€property€and€an€ample€opportunity€to€inspect€the€property€prior€to€closing.ðð€€InÐ ˆØ Ðaddition,€the€trial€court€made€the€following€specific€findings:Ð tÄ ÐÌà8  à12.€€Defendant€Mr.€Woodruff€discouraged€active€inspection€of€the€area€under€theÐ L œ Ðdeck€at€the€initial€inspection€but€did€not€discourage€any€active€inspection€prior€to€theÐ 8 ˆ Ðclosing€during€the€time€of€possession€by€the€plaintiffs.Ð$ tÐ Ð  Ðà8  àÐ Ð Ð  Ðà8  à13.€€Plaintiffs€stayed€overnight€at€the€residence€prior€to€closing€and€were€not€hinderedÐ ü L  Ðin€their€opportunity€to€inspect€the€property.Ðè 8 Ð Ð  ÐÌà@VV)ìà***ˆÐ À  Ðà8  àÐ Ð Ð  Ðà8  à15.€€Defendants€painted€the€recreational€room€in€anticipation€of€closing.Иè Ð Ð  Ðà8  àÐ Ð Ð  Ðà8  à16.€€Assertions€made€on€the€real€estate€disclosure€form€as€to€the€thermo€paneÐ pÀ Ðwindows€and€as€to€the€deck€foundation€wall€were€false€but€were€easily€discoverableÐ \¬ Ðby€the€plaintiffs.Ó†ºÓÐH˜Ð Ð  ÐÓÇ®ÓThese€additional€factual€findings€provide€further€support€for€the€trial€courtððs€conclusion€that€theÐ  p ÐPitzesðð€reliance€on€the€Woodruffsðð€representations€was€not€reasonable.Ð  \ ÐÌà  àWhether€a€partyððs€reliance€on€a€misrepresentation€was€reasonable€is€a€question€of€fact.€€ò òòòJ.€C.Ð ä4 ÐBradford€&€Co.€v.€Southern€Realty€Partnersóóó ó,€W1999„01617„COA„R3„CV,€2000€WL€34411153,Ð Ð  Ðat€*10€(Tenn.€Ct.€App.€Aug.€14,€2000).€€To€determine€the€reasonableness€of€a€plaintiffððs€reliance€onÐ ¼  Ða€misrepresentation,€we€consider:€(1)€the€plaintiffððs€business€expertise€and€sophistication;€(2)€theÐ ¨ø Ðexistence€of€a€longstanding€business€or€personal€relationship€between€the€parties;€(3)€the€availabilityÐ ”ä Ðof€the€relevant€information;€(4)€the€existence€of€a€fiduciary€relationship;€(5)€the€concealment€of€theÐ €Ð Ðfraud;€(6)€the€opportunity€to€discover€the€fraud;€(7)€which€party€initiated€the€transaction;€and€(8)€theÐ l¼ Ðspecificity€of€the€misrepresentation.€€òòò òId.ó óóóÔ#†XúœXXXúœZ#ÔÔ‡XúœXXXúœÔ€€Therefore,€based€on€those€factors,€we€must€determineÐ X ¨ Ðwhether€the€evidence€submitted€at€trial€preponderates€against€the€trial€courtððs€conclusion€that€theÐ D!” ÐPitzesðð€reliance€was€unreasonable.Ð 0"€  ÐÌà  àFirst,€we€note€that€the€trial€court€in€this€case€concluded€that€the€Woodruffs€madeÐ $X" Ðmisrepresentations€of€fact€with€respect€to€the€thermopane€windowsò òó ó,€the€fence€issue,€the€damageÐ ô$D # Ðcaused€by€the€lack€of€drainage€under€the€porch,€and€other€ð ðprevious€water€problemsðð€that€weÐ à%0!$ Ðinterpret€to€mean€the€leak€from€the€bedroom€doors€to€the€rec€room€and€the€overflowing€of€the€sumpÐ Ì&"% Ðinto€the€basement€room.€€The€trial€court€observed€that€the€Pitzes€had€ð ðfree€reinðð€and€ð ðampleÐ ¸'#& Ðopportunityðð€to€inspect€the€property€prior€to€closing,€and€that€in€light€of€Mr.€Pitzððs€undisputedÐ ¤(ô#' Ðexpertise,€the€defects€ð ðshould€have€reasonably€revealed€themselves.ððÐ )à$( Ðâ âÐ |*Ì%) Ðà  àOn€the€issue€of€the€fence,€we€must€conclude€that€the€evidence€does€not€support€the€trialÐ ° Ðâ âcourtððs€finding€that€a€misrepresentation€of€fact€was€made.€€To€the€contrary,€the€undisputed€evidenceÐ œì Ðwas€that,€prior€to€the€closing,€Mr.€Woodruff€told€Mr.€Pitz€that€the€fence€was€on€the€neighborððsÐ ˆØ Ðproperty.€€Mr.€Woodruffððs€offer€to€help€move€the€fence€cannot€be€deemed€a€misrepresentation€since,Ð tÄ Ðat€best,€it€was€clearly€a€promise€to€act€in€the€futureò òó ó.€€Fraud€based€on€a€promise€of€future€actionÐ `° Ðwithout€intent€to€perform€is€promissory€fraud,€and€the€Pitzes€have€articulated€no€such€claim€withÐ L œ Ðrespect€to€the€fence.€€ò òòòShahrdar€v.€Global€Housing,€Inc.ó óóó,€983€S.W.2d€230,€237€(Tenn.€Ct.€App.Ð 8 ˆ Ð1998).€€In€addition,€the€evidence€is€undisputed€that,€after€taking€possession,€Mr.€Pitz€never€asked€forÐ $ t ÐMr.€Woodruffððs€assistance€on€this€matter.€€Therefore,€this€claim€is€without€merit.Ð  ` ÐÌà  àOn€the€remaining€issues,€the€evidence€is€undisputed€that€the€Pitzes€spent€several€hours€on€theÐ è 8  Ðproperty€during€the€April€tour,€and€that€Mr.€Pitz€actually€saw€the€fog€on€the€thermopane€windows,Ð Ô$  Ðobserved€the€lack€of€drainage€under€the€porch,€and€saw€water€in€the€sump€under€the€stairs€in€theÐ À  Ðbasement.€€The€Pitzes€alleged€that€the€Woodruffs€painted€over€the€water€stain€on€the€ceiling€of€theÐ ¬ü  Ðrec€room€in€order€hide€the€leak€from€the€bedroom€doors.€€The€trial€court,€however,€found€only€thatÐ ˜è  Ðthe€Woodruffs€had€painted€the€stain€ð ðin€anticipation€of€closing,ðð€but€did€not€find€that€they€hadÐ „Ô  Ðattempted€to€conceal€a€material€defect.€€Mr.€Pitz€was€qualified€as€a€building€expert€at€trial,€and€heÐ pÀ Ðwas€shown€all€of€these€areas€of€the€house€during€his€April€tour€and€given€unfettered€opportunity€toÐ \¬ Ðinspect€prior€to€closing.€€Under€all€of€these€circumstances,€including€the€existence€of€the€ð ðas€isððÐ H˜ Ðprovision,€we€cannot€conclude€that€the€evidence€preponderates€against€the€trial€courtððs€conclusionÐ 4„ Ðthat€the€Pitzesðð€reliance€on€the€Woodruffsðð€misrepresentations€was€unreasonable.Ð  p ÐÌà  àThis€finding€also€precludes€any€recovery€based€on€misrepresentations€made€in€the€disclosureÐ øH Ðform,׃×Ý ƒ#ÃÝòòÚ  Ú10Ú  ÚóóÝ  Ý×  ×€as€well€as€separate€claims€based€on€fraudulent€concealment€and€fraudulent€nondisclosure.Ð ä4 ÐÌà  àThe€decision€of€the€trial€court€is€affirmed.€€Costs€on€appeal€are€to€be€taxed€to€AppellantsÐ ¼  ÐHerbert€F.€Pitz€and€Shirel€H.€Pitz,€and€their€surety,€for€which€execution€may€issue,€if€necessary.€€€€Ð ¨ø ÐÌÌÌÌà  àà ` àà ¸ àà  àà h àà À àà  à___________________________________€Ð D!” Ðà  àà ` àà ¸ àà  àà h àà À àà  àHOLLY€M.€KIRBY,€JUDGEÔ#†XúœXXXúœ«³#Ô