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HM Holdings, Inc. v. Rankin

ELR Citation: 26 ELR 20230
Nos. No. 94-3533, 53 F.3d 851/41 ERC 1833/(7th Cir., 11/14/1995)

The court holds that the presence of hazardous waste on industrial property that a company sold to an individual does not breach any express or implied warranties. The court first finds that the purchase and sale agreement contains no express warranties as to the condition of the property, and a rider to the agreement disclaims any representations as to that condition. The phrases "as is" and "as is, where is" in the rider are used in §2-316(3)(a) of the Uniform Commercial Code to disclaim implied warranties with respect to transactions in goods, and there has been no showing in this case that such phrases do not disclaim implied warranties in real estate transactions. The phrase in the rider that "Vendor has made no representation respecting the Real Estate or Purchaser's acquisition of the Real Estate" shows that the company made no express warranties as to the condition of the property, and the phrase that the buyer "has had adequate opportunity and access to the Real Estate to inspect and accept and further acknowledging that Vendor has made no representations respecting the Real Estate or Purchaser's acquisition of the Real Estate" demonstrates that plaintiff-appellee, the company's successor, was entitled to judgment. Accordingly, any implied warranties of condition were disclaimed. Also, the individual's acquisition of the property demonstrates that plaintiff-appellee made no express warranties, and any implied warranties of condition were disclaimed. In addition, defendant-appellant, the representative of the individual's estate, submitted no Indiana authority to show that the condition of the property, including the presence of hazardous waste, constitutes a defect in ownership precluding plaintiff-appellee from conveying merchantable title. And defendant-appellant has been unable to show that an Indiana court would make an implied warranty against hazardous waste contamination for purchasers of used industrial property nondisclaimable as a matter of law.

Counsel for Plaintiff
Andrew J. Fetsch
Beckman, Kelly & Smith
5920 Hohman Ave., Hammond IN 46320
(219) 933-6200

Counsel for Defendant
Leonard M. Holajter
Blackman, Bomberger & Moran
9006 Indianapolis Blvd., Highland IN 46322
(219) 972-2200

Before CUMMINGS, FLAUM, and MANION, Circuit Judges.