Preview:

Abdolrahman M. Adloo, et. al., v. H.T. Brown Real Estate, Inc. No. 143, September Term, 1995 Headnote: CONTRACT-REAL ESTATE-EXCULPATORY CLAUSE - The intention of the parties to a contract to exculpate one of the parties from liability for future negligence must be expressed in clear, explicit, and unequivocal language.

IN THE COURT OF APPEALS OF MARYLAND NO. 143 SEPTEMBER TERM, 1995 ___________________________________ ABDOLRAHMAN M. ADLOO et al. V. H.T. BROWN REAL ESTATE, INC. ___________________________________ *Murphy, C. J. Eldridge Rodowsky Chasanow Karwacki Bell Raker, JJ. ___________________________________ OPINION BY BELL, J. ___________________________________ FILED: December 16, 1996

* Murphy, C.J., now retired, participated in the hearing and conference of this case while an active member of this Court; after being recalled pursuant to the Constitution, Article IV, Section 3A, he also participated in the decision and the adoption of this opinion.

In this case, we are asked to resolve whether, as a matter of law, clauses in a real estate listing contract between the

petitioners, Abdolrahman Adloo, and Monireh, his wife, and the respondent H.T. Brown Real Estate, Inc., and in a related lock-box authorization are exculpatory clauses, which absolve the real estate company from liability for its future negligence. The

Circuit Court for Montgomery County having denied the respondent's motion for judgment premised on the clauses being exculpatory, the jury returned a verdict in favor of the petitioners. The

respondent successfully appealed to the Court of Special Appeals, which, in an unreported opinion, held that "a provision in an agreement between homeowners and their real estate broker

exculpating the broker from any liability for the loss of the homeowners' personal property ... is enforceable." We granted the

petitioner's petition and issued the writ of certiorari to consider the issue.1 We shall reverse the judgment of the intermediate

appellate court. I The petitioners entered into an exclusive listing agreement with the respondent for the sale of the petitioner's home. listing agreement contained the following clause: That

Although both parties addressed a second issue, the sufficiency of the evidence to support the jury's verdict, we were asked to grant certiorari, and in fact we granted certiorari, on only one issue, the validity and effect of the exculpatory clauses. Accordingly, the sufficiency of the evidence is not before us and we shall refrain from addressing it.

1

2 Neither REALTOR nor his agents or sub-agents are responsible for vandalism, theft or damage of any nature whatsoever to the property, nor is REALTOR responsible for the custody of the property, its management, maintenance, upkeep or repair. It also provided that the petitioners' home would be available for showing "at all reasonable hours." Consistent with the latter provision and in order to

facilitate the showing of the petitioners' home, the petitioners subsequently executed a lock-box authorization.2 Pursuant to that

authorization, the petitioners agreed to the installation and use of a lock-box device, which allowed their home to be shown without either the petitioners or the respondent's agent being present. While the respondent instructed the petitioners to disengage the security system monitoring their home to allow access to the home, the authorization cautioned the petitioners to "safeguard" their valuables. It also contained the following provision:

SELLER further acknowledges that neither Listing or Selling BROKER nor their agents are an insurer against the loss of personal property; SELLER agrees to waive and releases BROKER and his agents and/or cooperating agents and brokers from any responsibility therefore [sic]. The respondent received a telephone call from a man who identified himself as Alvin Harris and represented that he was an agent of Shannon and Luchs, another real estate broker.
2

Informing

The listing agreement and the lock box authorization were standardized realtor contracts used in Montgomery and Prince George's counties, respectively. Given our view of the issue, it is not necessary that we address the petitioners' argument concerning the propriety of the use of these forms in Montgomery County.

3 the respondent's employee of his intention to show the petitioners' home that afternoon, "Mr. Harris" requested, and eventually

secured, the lock-box combination.3 the employee the followed bona the

In providing that information, established his policy of and

respondent's of the

verifying

fides

caller,

identity

affiliation with the named agency, by calling, without first conducting any independent investigation, the number the caller gave her. Subsequently, it was discovered that the caller was an

impostor; Shannon and Luchs did not have an agent named Alvin Harris. According to the records of the Maryland Real Estate

Commission, no real estate license has been issued in that name, and the number given to the respondent's employee was not a Shannon and Luchs number. It was also discovered that cash, jewelry, and

other property totalling nearly $40,000 had been taken from the petitioners' home. Having filed, and settled, a claim with their insurance carrier, the petitioners sued the respondents for damages.

Following a trial in the Circuit Court for Montgomery County, the jury awarded them $20,000. Court of Special Appeals. judgment of the circuit The respondent noted an appeal to the The intermediate court reversed the court. In an unreported opinion,

characterizing it as an exculpatory clause, that court held that The lock-box, which contained the key to the house, placed on the petitioners' house was a combination lock-box; thus, it could be opened only by using the correct combination.
3

4 the lock-box authorization provision, quoted above, was valid and enforceable and, thus, precluded the petitioners' claim. We

granted certiorari, at the petitioners' request, to consider this important issue. II A. It is well settled in this State, consistent with "the public policy of freedom of contract," see Wolf v. Ford, 335 Md. 525,

531, 644 A.2d 522, 525 (1994), that exculpatory contractual clauses generally are valid. 477, 480, 180 A.2d Id.; Eastern Ave. Corp. v. Hughes, 228 Md. 486, 488 (1962)4; Atty Griev. Comm'n v.

Owrutsky, 322 Md. 334, 350, 587 A.2d 511, 518 (1991); Sullivan v. Mosner, 266 Md. 479, 494-96, 295 A.2d 482, 490-91 (1972); Baker v. Roy Haas Associates, Inc., 97 Md. App. 371, 377, 629 A.2d 1317, 1320 (1993); Schrier v. Beltway Alarm Co., 73 Md. App. 281, 286, 533 A.2d 1316, 1318 (1987); Boucher v. Riner, 68 Md. App. 539, 548, 514 A.2d 485, 490 (1986); Winterstein v. Wilcom, 16 Md.App. 130, 135, 293 A.2d 821, 824, cert. denied, 266 Md. 744 (1972). Aside

At issue in that case was an exculpatory clause in a lease for a residential property. Subsequent to our holding such a clause valid and enforceable, the General Assembly enacted legislation declaring exculpatory clauses in real property leases to be void as against public policy. Ch. 124, Acts of 1964, now codified at Maryland Code (1974, 1988 Repl.Vol.)

Download ADLOO V. H.T. Brown.pdf

Maryland Law