LRB-1451/1
PJK&PJH:bjk:rs
2009 - 2010 LEGISLATURE
January 27, 2009 - Introduced by Representatives Radcliffe, Hebl, Colon,
Soletski, Roys, Richards, Pope-Roberts, Shilling, Berceau, Parisi,
Hraychuck, Molepske, A. Ott and Van Roy, cosponsored by Senators
Erpenbach, Hansen, Taylor, Lehman, Lassa, Wirch, Sullivan, Olsen and
Schultz. Referred to Committee on Consumer Protection.
AB6,1,2
1An Act to create 895.10 of the statutes;
relating to: a tort action for intentional
2misrepresentation in a residential real estate transaction.
Analysis by the Legislative Reference Bureau
In Below v. Norton, 2008 WI 77, 751 N.W. 2d 351, the Wisconsin Supreme Court
determined that the economic loss doctrine bars a homebuyer from recovering in tort
for an intentional misrepresentation concerning the property made by the seller of
the property. Under the judicially created economic loss doctrine, a purchaser of a
product that is defective may not recover from the seller on a tort theory, such as an
action for damages for fraud or intentional misrepresentation, for damages that are
solely economic; the recovery is limited to damages for a breach of contract. Before
Below, with respect to real estate sales, the economic loss doctrine applied only to
commercial transactions.
This bill reverses the decision in Below by providing that, in addition to any
other remedies that are available, a transferee (purchaser) in a residential real
estate transaction may maintain an action in tort against the transferor (seller) of
the real estate for fraud committed, or an intentional misrepresentation made, by the
transferor in the residential real estate transaction. The bill defines a residential
real estate transaction as a real estate transfer for which a real estate condition
report is required, which is, generally, a transfer of previously inhabited real
property.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB6, s. 1
1Section
1. 895.10 of the statutes is created to read:
AB6,2,4
2895.10 Tort actions in residential real estate transactions. (1) In this
3section, "residential real estate transaction" means a real estate transfer to which
4s. 709.01 (1) applies.
AB6,2,8
5(2) In addition to any other remedies available under law, a transferee in a
6residential real estate transaction may maintain an action in tort against the real
7estate transferor for fraud committed, or an intentional misrepresentation made, by
8the transferor in the residential real estate transaction.
AB6,2,1110
(1) This act first applies to residential real estate transactions that are
11completed on the effective date of this subsection.
