There are many different kinds of lawsuits filed in courts around the country every year. Most are pretty standard and involve things like contract disputes, car accidents, medical malpractice, and so on and so forth. But occasionally a lawsuit comes to court that is much more unusual. These types of lawsuits can obtain a level of infamy within the legal community and sometimes with the public at large as well. As it was Friday the Thirteenth last week, here is one such lawsuit, with a quite unique set of supernatural circumstances.
A Haunted Reputation
The house at issue in the spooky case of Stambovsky v. Ackley was located in upstate New York in a town called Nyack. It was a turn of the century Victorian home that the seller, Helen Ackley, claimed was haunted by three ghosts. In fact, stories on her supernatural house guests had appeared in the local press and Reader's Digest. Jeffrey Stambovsky, who was from New York City, purchased the house in the fall of 1989. While some people may have been thrilled to learn they were going to be rooming with a ghost, Stambovsky was not. He didn't learn about his new home's haunted reputation until after he signed the contract for sale and put a down payment on the house. Concerned that this reputation would affect the resale potential of the property as well as the property value, Stambovsky sought rescission of the contract.
The lower court denied his request, but he had better luck on appeal. First, because the owner had repeatedly stated the house had ghosts the court ruled that the "defendant is estopped to deny their existence and, as a matter of law, the house is haunted." Though the court was not moved by Stambovsky's claim for fraudulent misrepresentation, specifically saying, "plaintiff hasn't a ghost of a chance," the court did look at whether he could seek rescission as an equitable remedy.
The court stated that New York followed the law of caveat emptor, which is Latin for "Let the buyer beware." This doctrine "imposes no duty upon the vendor to disclose any information concerning the premises unless there is a confidential or fiduciary relationship between the parties or some conduct on the part of the seller which constitutes 'active concealment'." Under caveat emptor, a buyer is required to "act prudently to assess the fitness and value of his purchase and [the doctrine] operates to bar the purchaser who fails to exercise due care from seeking the equitable remedy of rescission." However, there are exceptions to the rule, and the court stated that "[w]here fairness and common sense dictate that an exception should be created, the evolution of the law should not be stifled by rigid application of a legal maxim."
With regards to whether or not Stambovsky complied his inspection requirement, the court stated that "the most meticulous inspection and the search would not reveal the presence of poltergeists at the premises or unearth the property's ghoulish reputation in the community." It further stated that, "[w]here a condition which has been created by the seller materially impairs the value of the contract and is peculiarly within the knowledge of the seller or unlikely to be discovered by a prudent purchaser exercising due care with respect to the subject transaction, nondisclosure constitutes a basis for rescission as a matter of equity." Since Ackley had held her house out as haunted to the general public and failed to inform Stambovsky of the ghostly presence, the court decided that Stambovsky's case was an exception to caveat emptor and rescission was an appropriate remedy.
According to Wikipedia, Ackley was later able to sell her haunted home.