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Ferris v. Location 3 Corp

ELR Citation: 41 ELR 20272
Nos. No. 2010AP2203, (Wis. Ct. App. , 08/10/2011)

A Wisconsin appellate court held that real estate agents may be held liable to the purchasers of their client's property for failing to disclose that a landfill next to the purchased property was a Superfund site. The purchasers learned that the landfill was a Superfund site shortly after closing. The purchasers then filed a complaint against the former owner and the real estate agents alleging that they knew about the Superfund site but failed to disclose it on the real estate condition report. The defendants moved for partial summary judgment, arguing that the claim was barred by the economic loss doctrine and that agents should be dismissed from the lawsuit because there were no facts pled to support piercing the corporate veil. The lower court properly ruled that the purchasers' claim was not barred by the economic loss doctrine. But the lower court erred in dismissing the agents from the case as individuals. The lower court ruled that there was nothing in the record indicating that the agents acted outside the scope of their authority as agents of their client. But Wisconsin case law has firmly established that individuals are liable for their own tortious conduct. Thus, the agents in this case cannot hide behind the corporate veil.