IN THE CIRCUIT COURT OF HARRISON COUNTY, MISSISSIPPI SECOND JUDICIAL DISTRICT

Transcription

1 IN THE CIRCUIT COURT OF HARRISON COUNTY, MISSISSIPPI SECOND JUDICIAL DISTRICT JIM SPIERS and TONYA SPIERS, ) ) Plaintiffs, ) ) v. ) Civil Action No. A ) THE TERMINIX INTERNATIONAL ) COMPANY, LP; NORMAN LOUVIERE; ) RICHARD NORCROSS; CHARLES ) DURSO; SHERRY L. OWEN, ) Individually and as agent for ) OWEN & CO. LLC; RICK LY and ) VANNA LY; JOHN DOE ) DEFENDANTS 1 10 ) ) Defendants. ) DEFENDANTS THE TERMINIX INTERNATIONAL COMPANY, LP, NORMAN LOUVIERE, RICHARD NORCROSS, AND CHARLES DURSO S MEMORANDUM OF LAW IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT NOW COME, Defendants, The Terminix International Company, LP ( Terminix ), Norman Louviere, Richard Norcross, and Charles Durso (collectively, the Terminix Defendants ), by and through their undersigned counsel, pursuant Rule 56 of the Mississippi Rules of Civil Procedure, and respectfully submit this, their Memorandum of Law in Support of their Motion for Summary Judgment, and in support hereof, would show as follows: I.INTRODUCTION Plaintiffs, JIM SPIERS and TONYA SPIERS, allege that the Terminix Defendants failed to disclose required information in a December 2013 Wood Destroying Insect Report ("WDIR") prepared by Charles Durso in connection with plaintiffs' purchase of a house located at 200 Bayou La Porte Drive, Biloxi, MS (the Property ). The undisputed evidence shows that the Terminix Defendants did all that was required by State regulations to complete the WDIR Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page v1 1 of

2 inspection and report. To the extent Plaintiffs seek to impose obligations onto Terminix that are beyond what Mississippi law requires, such a claim must be rejected as a matter of law. It is also undisputed that before they closed on the Property, Plaintiffs were told in no less than four different ways that the Property carried with it a substantial risk of termite-related problems. The sellers of the Property provided Plaintiffs with statements that disclosed that the Property had previously been damaged by termites, and that this damage had to be repaired. Subsequently, Plaintiffs hired a professional home inspector to examine the property. This home inspector flagged two areas of the Property that exhibited termite damage. He described these areas as major concerns and recommended that Plaintiffs retain a qualified contractor to evaluate them. Thereafter, Charles Durso, on behalf of Terminix, prepared a Wood Destroying Insect Report ( WDIR ). The WDIR likewise found evidence of previous termite infestations and disclosed that the Property had previously been treated for termites. It also disclosed certain conditions on the Property that made it conducive to termite infestations. In addition to the foregoing, Plaintiffs were also told in conversations on several occasions that the Property exhibited termite damage. Plaintiffs admit that they knew all of this before they bought the Property. There can simply be no claim that Plaintiffs were not on notice of the termite-related risks associated with the Property and therefore, no proximate cause between any alleged failures by Terminix and Plaintiffs' decision to purchase. In fact, the Court previously found, in ruling on summary judgment motions filed by former parties, that Plaintiffs were provided with sufficient information regarding the home's termite issues. The absence of any evidence of proximate cause defeats all of Plaintiff's claims against the Terminix Defendants, in their entirety, and entitles the Terminix Defendants to summary judgment on all counts of the Complaint. 2 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 2 of 19

3 II. FACTS Vanna Ly and Rick Ly bought the Property on April 30, (See Exhibit 1 (Rick Ly Dep.) at 21: 10-16) In 2010, the Lys discovered termites in the Property. (Id. at 38: 6-15) Consequently, Rick Ly repaired the home at his own expense. (Id. at 48-49) The damages totaled $7,000-$10,000. (Id. at 51: 2-5) The Lys had the Property treated for termites and, on about May 20, 2010, obtained from Terminix a Mississippi Defined Termite Protection Plan (the Termite Protection Plan ) for the Property. (Id. at 31: 7-8) In 2012, Vanna Ly discovered termites in the Property. (See Exhibit 2 (Vanna Ly Dep.) at 80:21-81:17) Terminix was contacted to address the issue pursuant to the Termite Protection Plan. (Id. at 81:22-82:2) Terminix investigated the problem and discovered a termite infestation that necessitated about $55,000 in repairs to the Property. (Id. at 90: 16-21) On about February 2, 2012, the Lys listed the Property for Sale through Cheryl Boudreaux, an independent agent with Owen & Co. (Ex. 2 at 21:22-22:3) Eventually, the Property came to be listed with former Defendant Sherry Owen. In conjunction with the agreement to list the Property with Owen, Rick Ly completed a Property Condition Disclosure Statement ( Disclosure Statement ) pursuant to Miss. Code Ann through (See Exhibit 3 (Disclosure Statement)) In the Disclosure Statement, under Item C, Rick Ly disclosed the following: HISTORY OF INFESTATION, IF ANY: TERMITES, CARPENTER ANTS, ETC.: Any evidence of rot, mildew, vermin, rodents, termites, carpenter ants, or other infestation? Yes X No Have you requested treatments for any type of infestations? Yes X No Explain: Are you aware of any Repaired Damage? Yes X No Explain: sheet room not repair window. Repaired. Is there currently an outstanding termite contract? Yes X No Who is the contrator? Terminex [sic] 3 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 3 of 19

4 (See Ex. 3) In 2013, Plaintiffs decided to shop for a new home with the assistance of real estate agent Michelle Fillipich. Plaintiffs inspected the Property and were provided with a copy of the Disclosure Statement. (See Exhibit 4 (Tonya Spiers Dep.) at 23: 4-19; 178: 5-9) They received the Disclosure Statement before making an offer. (Id. at 181: 5-15) After reviewing the Disclosure Statement, Plaintiffs, through their real estate agent Fillipich, asked Owen about Rick Ly s disclosures in Item C of the Disclosure Statement. (Id. at 182: 7-21; 75:24-76:13) Owen, after seeking clarification from Rick Ly, told Plaintiffs that the Property had sustained some termite damage in the laundry room, and that the damage had been repaired. (Id. at 182: 18-21; 76:14-77:1) Having received the Disclosure Statement, Plaintiffs decided to have the home inspected by a professional home inspector. (Ex. 4 at 76: 8-13) They hired Ricky Authement of Home Inspection Building Specialist, LLC, to do the inspection. (See Ex. 4 at 51:22-52:24; see also Exhibit 5 (Home Inspection Report)) On October 23, 2013, Authement, with the assistance of inspector Robert Davis, performed the inspection. (See generally Ex. 5) Plaintiff Jim Spiers was present during the inspection. (See Exhibit 6 (Jim Spiers Dep.) at 18:4-19:1) During the inspection, Authement pointed to areas in the Property above the foyer and told Mr. Spiers that there were tunnels a reference to termite tunnels. (Id. at 19:5-8) He also told Mr. Spiers that there was some dirt above the foyer a reference to dirt tubes. (Id. at 19:12-16) When asked whether Authement told him that the tunnels were caused by termites, Mr. Spiers testified that he did not recall. (Id. at 19:9-20) Following the inspection, Authement prepared a report (the Inspection Report ) that summarized his findings. (See Ex. 5; see also Ex. 4 at 51:22-52:24) The purpose of the 4 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 4 of 19

5 Inspection Report was to educate Plaintiffs about the condition of the Property. (Ex. 4 at 54:25-55:3) Plaintiffs received the Inspection Report in October of (Id. at 183: 4-11) The Inspection Report identified eighteen MAJOR CONCERNS, which it describes as Item(s )that have failed or have potential of failing soon. (See Ex. 5 at 27) The Inspection Report identified as major concerns two areas of the Property that exhibited termite damage: 7. Window in the laundry room at the front of the house is damaged at the base of the window. Damage appears to be old termite damage. Recommend a qualified contractor further valuate for repair. *** 13. Walls above the foyer entrance appear to have evidence of old termite activity. Dirt tubes were sighted in the walls corner and along the bottom of the window casing. Recommend a qualified contractor further valuate for repair. (See Ex. 5 at 27) (emphasis added) Plaintiffs admit that the Inspection Report specifically mentions termite damage. (Ex. 4 at 58: 4-15) lawsuit: In addition, the Inspection Report identified another major concern relevant to this 2. One portion of the roof over the pool patio is sagging in the center and this is also causing water to pond in the gutter. It appears that the span is too long for the beam used to support the roof. Recommend a qualified contractor further evaluate to determine scope of work for repair. (See id.) Plaintiffs had Chet Nadolski, an engineer friend of Mr. Spiers, take a look at the sagging roof. (Ex. 6 at 25:11-19) Nadolski told Mr. Spiers that the roof was likely sagging because the span is too long for the beam used to support the roof. (Id. at 27:3-5) Rick Ly hired Terminix to prepare the WDIR at Plaintiffs' request. (See Exhibit 7 (WDIR); see also Ex. 4 at 67:7-68:5-8) On December 2, 2013, Charles Durso, an employee of Terminix, performed the WDIR inspection. (See Ex. 7; see also Exhibit 9 (Durso Dep.) at 6:9-12) Durso had done between such inspections by the time he inspected the Property. 5 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 5 of 19

6 (Id. at 16:22-17:1) After inspecting the Property, Durso reviewed the file for the Property that Terminix maintained at its Gulfport, MS branch. (Id. at 26:12-27:8) The file contains Terminix s treatment records for the Property. (Id. at 27:5-8) Thereafter, he prepared the WDIR, which was reviewed and approved by Norman Louviere, Terminix s service manager for its Gulfport, MS branch. (See Exhibit 8 (Louviere Dep.) at 20:6-8; 56:14-57:2) In connection with its preparation of the WDIR, Terminix stated: Terminix will perform an inspection and prepare a report for Wood Destroying Insect Infestation at the abovereferenced property, pursuant to the applicable regulations and on the form for such report as required, authorized and/or allowed by the State where the property is located. (See Exhibit 11 (Request for Wood Destroying Insect Infestation Inspection and Report for Real Estate Transactions) at 1) The WDIR again disclosed that the Property had previously been infested with subterranean termites, for which there had been previous treatment. (Ex. 7) It also disclosed numerous conditions at the Property conducive to wood destroying insect infestations, as well as PHD, or potential hidden damage, at the Property. (See id.; see also Ex. 9 at 28: 12-24) The WDIR stated that Durso s inspection did not reveal visible evidence of an active termite infestation, nor did it reveal visible evidence of insect damages. (See Ex. 7) The WDIR did not identify or describe Terminix s 2012 damage repairs at the Property because the form is standardized and does not call for the disclosure of such information. (See Ex. 7; see also Ex. 9 at 29: 3-16) ( See Exhibit 11, Depostion of Jasper Cobb from the State Plant Board at p.152, L and p. 150 L. 8-9) The WDIR disclosed that there was a current termite contract in force for the Property, but that the contract was not transferable. (Id.) 6 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 6 of 19

7 The WDIR included a Statement of Pest Control Operator. That statement informed Plaintiffs that the WDIR was made on the basis of what was visible and accessible at the time of the inspection. (See Ex. 7) (emphasis added) It further stated that the WDIR is not a warranty as to the absence of wood destroying insects, hidden damage, or the presence of all conditions conducive to wood destroying insect infestations. (Id.) It also stated that the WDIR is not an opinion covering areas that are enclosed or inaccessible or any portion of the structure in which inspection would necessitate removing or defacing any part of the structure or removing or moving its contents. (Id.) In other words, the WDIR is based on a visual inspection only. The Statement of Pest Control Operator further states that "[t]his report is not a structural damage report," and that "[Terminix's] inspectors are not engineers or builders and you may wish to call a qualified engineer or expert in the building trade to ascertain their opinion as to whether there is structural damage to this property...." (Id.). Plaintiffs received the WDIR before they bought the Property. (Ex. 4 at 73:12-16) Although Plaintiffs admit that the WDIR discloses a previous termite infestation (Ex. 6 at 29:22-30:1), Plaintiffs did not have any specific questions about any of the information contained in the WDIR. (Ex. 4 at 74: 6-8; Ex. 6 at 51: 7-10; 79: 12-15) Nor did Plaintiffs speak to anyone from Terminix, prior to the time they bought the Property, about the WDIR. (Ex. 4 at 69:1-5; Ex. 6 at 29: 8-13) The WDIR cost $80. ((Ex. 6 at 52:12-53:1) Plaintiffs bought the Property in December 2014, and moved in sometime during the late winter or early spring of (Ex. 4 at 114: 4-9) They hired a contractor, Bob Latil Construction, to fix the sagging roof over the pool patio that was identified as a major concern in the Inspection Report. (Id. at 114: 10-18) The contractor opened up the roof and found an active termite infestation in the support beam. (Id. at 114: 19-22) Plaintiffs contacted Terminix, 7 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 7 of 19

8 and Louviere met with Mr. Spiers to discuss the issue. (Ex. 6 at 62: 18-24) Louviere provided Mr. Spiers witih a copy of Terminix s file for the Property. (Id.) Louviere also went to the Property, and Mr. Spiers opened up a hole in a wall and removed stucco from the support beam to show Louviere a termite infestation. (Ex. 6 at 69:24-70:4) On December 15, 2014, Plaintiffs filed this lawsuit. They sued The Terminix Defendants, Sherry Owen, Owen & Co., LLC, and Rick and Vanna Ly. A copy of the Complaint is attached as Exhibit 10. III.LEGAL STANDARD Rule 56 of the Mississippi Rules of Civil Procedure governs the granting of summary judgment motions. See MRCP 56. It allows a party against whom a claim is asserted to move with or without supporting affidavits for a summary judgment in its favor, so long as the motion is served at least ten days before the time fixed for the hearing. Initially, the party moving for a summary judgment bears the responsibility of providing the court with the basis of its motion and identifying the portions of the record in the case that establish the absence of a genuine issue of material fact. Franklin v. Thompson, 722 So.2d 688, 691 (Miss. 1998). However, once the moving party has properly supported its motion for summary judgment, the non-moving party must respond by setting forth specific facts showing there is a genuine issue for trial. Brown v. Credit Ctr. Inc., 444 So.2d 358, 363 (Miss. 1983). The party opposing the motion must be diligent and may not rest upon allegations or denials in the pleadings, but must by allegations or denials set forth specific facts showing that there are indeed genuine issues for trial. Richmond v. Benchmark Construction Corp., 692 So.2d 60, 61 (Miss. 1997). In other words, when a motion for summary judgment is filed, the nonmoving party must rebut by producing significant probative evidence showing that there are indeed 8 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 8 of 19

9 genuine issues for trial. Foster v. Noel, 715 So.2d 174, 180 (Miss. 1998). Mere allegation or denial of material fact is insufficient to generate a triable issue of fact and avoid an adverse rendering of summary judgment. More specifically, the plaintiff may not rely solely upon unsworn allegations in the pleadings, or arguments and assertions in briefs or legal memoranda. Palmer v. Biloxi Regional Medical Ctr., 564 So.2d 1346, 1356 (Miss. 1990). IV.ARGUMENT Plaintiffs have filed ten claims against the Terminix Defendants. Those claims sound in various theories of negligence, breach of fiduciary duty, and misrepresentation. To prevail on a claim for negligence, Plaintiffs must establish by a preponderance of the evidence: (1) the Terminix Defendants owed them a duty; (2) the Terminix Defendants breached that duty; and (3) the Terminix Defendants breach of such duty caused Plaintiffs injuries. Miss. Dep't of Mental Health v. Hall, 936 So. 2d 917, 922 (Miss. 2006). The Plaintiffs must show a causal connection between the breach and the [injury], such that the breach is the proximate cause of the [injury]. Double Quick v. Lymas, 50 So. 3d 292, 298 (Miss. 2010). Similarly, to prevail on a claim for breach of fiduciary duty, Plaintiffs must establish by a preponderance of the evidence: (1) the Terminix Defendants owed them a fiduciary duty; (2) the Terminix Defendants breached that duty; and (3) the Terminix Defendants breach of such duty caused Plaintiffs injuries. Callicutt v. Prof'l Servs. of Potts Camp, Inc., 974 So. 2d 216, 221, 2007 (Miss. 2007). Finally, to prevail on their claims of misrepresentation, Plaintiffs must prove, inter alia, that they relied on a misrepresentation that was made by the Terminix Defendants, and that this reliance was reasonable. Am. Bankers' Ins. Co. v. Wells, 819 So. 2d 1196, 1207, 2001 Miss. LEXIS 312, *27; Shogyo International Corp. v. First National Bank of Clarksdale, 475 So. 2d 425, 427 (Miss. 1985). 9 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 9 of 19

10 The claims boil down to two general allegations of wrongdoing: (1) the Terminix Defendants failed to properly inspect the Property in connection with their preparation of the WDIR; and (2) the Terminix Defendants failed to disclose information concerning termite issues at the Property. These allegations fail, as a matter of law, and Terminix is entitled to summary judgment on all claims. First, the Terminix Defendants disclosed everything that they were required to disclose under Mississippi law. In Mississippi, a Wood Destroying Insect Report is a standardized form that is disseminated by the Department of Agriculture s Bureau of Plant Industry ( Bureau ). Inspectors, like Terminix, are required to use the Bureau s form. Similarly, the Department of Agriculture determines the information that inspectors are required to disclose on that report. The undisputed evidence shows that Terminix disclosed the information called for by the State form. There were no contracts as between the Terminix Defendants and Plaintiffs, and the Terminix Defendants do not owe Plaintiffs any fiduciary duty. Insofar as Plaintiffs are basing their claims on Terminix s alleged failure to disclose information that the Bureau does not require Terminix to disclose, their claims fail as a matter of law. Second, the undisputed evidence shows that Plaintiffs cannot establish causation or, with respect to their claims of fraudulent and negligent misrepresentation, reasonable reliance. That is because Plaintiffs were made aware of termite-related issues at the Property on no less than four occasions and in no less than four ways prior to closing on the Property. Any failure by Terminix to conduct a proper inspection of the Property (and there was no such failure) thus cannot be said to have caused Plaintiffs claimed damages because Plaintiffs were already aware of the termite-related issues that they claim the inspection failed to disclose. 10 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 10 of 19

11 For these reasons, there is no genuine issue of material fact as to any of Plaintiffs' claims, and the Terminix Defendants are entitled to judgment in their favor as a matter of law on all claims. A. The Undisputed Evidence Shows that Terminix's WDIR Complied with Applicable State Regulations The legislature has placed the responsibility for enacting regulations related to the preparation of the Mississippi Official Wood Destroying Insect Report in the hands of the Mississippi Department of Agriculture. See Miss. Code Ann , The Department of Agriculture has enacted regulations that govern such inspections. They are found in Subpart 3, Chapter 11, Subchapter 01. These regulations state the information that inspectors are required to disclose on that WDIR report form. All inspection reports issued regarding the presence or absence of termites and other wood destroying insects in connection with a real estate transaction shall be made on a form prescribed and officially adopted by the Bureau. Miss. Dep t of Agriculture Regulations, Subpart 3, Chapter 11, Subchapter 01, (1) (emphasis added). The Mississippi Standard Wood Destroying Insect Report requires the inspector to state whether the inspection reveals visible evidence of active infestation, previous infestation, previous treatment, or insect damage. (See Ex. 7) It also requires the inspector to state whether the structure was previously treated and whether there is a current contract in force for the Property. Terminix was therefore not required to disclose information, other than the above, relating to the Property s prior history. (See Ex. 9 at 28:25-29:6) The Bureau does not require the WDIR to be based on anything other than a visual inspection. The inspection shall be based on a thorough visual inspection of accessible areas. Id. at (3). The regulations provide, inter alia: Wood Destroying Insect Report. 11 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 11 of 19

12 3. The inspection shall be based on a thorough visual inspection of accessible areas and provide accurate written disclosure of presence, absence, previous infestation and damage caused by subterranean termites, drywood termites and wood borer beetles and other wood destroying insects such as carpenter ants and carpenter bees. Miss. Dep t of Agriculture Regulations, Subpart 3, Chapter 11, Subchapter 01, (3). Accordingly, the Mississippi Wood Destroying Insect Form only requires certain information to be disclosed, and it only requires that such information be disclosed based on a visual inspection of accessible areas. Nonetheless, Durso consulted Terminix s file for the Property, which includes the Property s treatment records, in order to prepare the WDIR. (Id. at 26:12-27:8) On the WDIR, he stated that the Property did have a previous infestation, and that it was treated previously. (See Ex. 7) He also stated that the Property was previously treated by Terminix, and that there was a current contract in force on the Property. (See Ex. 7) In other words, Durso truthfully disclosed the information that he was required to disclose on the WDIR. (See id.) To the extent Plaintiffs claim the WDIR was faulty for not disclosing the termite infestation discovered by Plaintiffs' contractor, Bob Latil, in the Spring of 2014, there is no evidence whatsoever that that infestation at the Property should have, or even could have, been discovered by a purely visual inspection which again, is all that Terminix was legally required to do. Mr. Spiers testified that it was not until his contractor, Mr. Latil, opened up that roof to perform structural repairs that the live termite infestation was discovered. (Ex. 4 at 114: 19-22) When Louviere went to the Property to observe some of the damage, Mr. Spiers had to cut a hole in the wall and remove stucco in order to show him the active infestation. (Ex. 6 at 69:24-70:4) There is simply no evidence whatsoever that the live infestation discovered by Plaintiffs after their purchase of the Property was visible to Terminix at the time of the WDIR inspection. 12 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 12 of 19

13 To the extent Plaintiffs claim that the Terminix Defendants are liable to them for failure to disclose information about the Property s termite problems that Terminix knew by way of its termite contract on the Property (for example, the 2012 damage repairs), that claim also fails, for the simple reason that neither the regulations nor the WDIR form obligate Terminix to disclose such information. Insofar as Plaintiffs claim that Terminix "warranted" in the WDIR that the Property was free of termite-problems, that claim also fails. The Mississippi Department of Agriculture s regulations, which regulate the preparation of Wood Destroying Insect Reports, expressly provide that there is no warranty, express or implied, related to the Mississippi Official Wood Destroying Insect Report form. Miss. Dep t of Agriculture Regulations, Subpart 3, Chapter 11, Subchapter 01, (6). Moreover, the Terminix Statement of Pest Control Operator states, This report is not a warranty as to the absence of wood destroying insects, hidden damage, or the presence of all conditions conducive to wood destroying insect infestations. (Ex. 7) The Terminix Defendants also did not have a fiduciary duty to disclose additional information to Plaintiffs. There was, and is, no fiduciary relationship as between the Terminix Defendants and Plaintiffs. A fiduciary duty is established: Whenever there is a relation between two people in which one person is in a position to exercise a dominant influence upon the former, arising either from weakness of mind or body, or through trust. Mullins v. Ratcliff, 515 So. 2d 1183, 1191 (Miss. 1987) (citing Hendricks v. James, 421 So. 2d 1031, 1041 (Miss. 1982)). The relationship arises when a dominant, overmastering influence controls over a dependent person or trust justifiably reposed. Id. The Terminix Defendants did not exercise a dominant influence on Plaintiffs here. To the contrary, Mr. Spiers admitted that he does not know the purpose of a WDIR. (Ex. 6 at 75:15-17) Plaintiffs did not have any specific questions 13 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 13 of 19

14 about any of the information contained in the WDIR. (Ex. 4 at 74: 6-8; Ex. 6 at 51: 7-10; 79: 12-15) Nor did Plaintiffs speak to anyone from Terminix, prior to the time they bought the Property, about the WDIR. (Ex. 4 at 69:1-5; Ex. 6 at 29: 8-13) There is simply no evidence that Terminix exercised any influence over Plaintiffs here, much less the dominant, overmastering influence necessary for a fiduciary duty to be established. Pest control companies do not generally owe fiduciary duties to their customers. The relationship between a pest control company and its customer is merely an arms-length transaction. It does not give rise to a duty of disclosure. See, e.g., MS Credit Ctr., Inc. v. Horton, 926 So. 2d 167, 177 (Miss. 2006) (duties to disclose do not arise in arms-length transactions or under an ordinary standard of care); Union Planters Nat l Bank, N.A. v. Jetton, 856 So. 2d 674, 677 (Miss. App. Ct. 2003) (Mississippi courts are reluctant to impose fiduciary duties where the relationship between the parties amounts to an arms-length transaction). Here, of course, there is even less basis to find a fiduciary duty because Plaintiffs were not customers of the Terminix Defendants. Rick Ly not Plaintiffs hired Terminix to prepare the WDIR. (See Ex. 7; see also Ex. 4 at 67:7-68:5) There was no other contract between the Terminix Defendants and Plaintiffs. (See Ex. 6 at 56: 19-25) Because there was no dominant, overmastering influence exerted by the Terminix Defendants, or any contractual relationship between Plaintiffs and the Terminix Defendants, it appears that Plaintiffs are asking this Court to hold that the Terminix Defendants owed Plaintiffs a fiduciary duty based solely on the fact that, in the eyes of Plaintiffs, it was reasonably foreseeable that Plaintiffs would receive the WDIR. Such a theory is unsupported and without merit. A holding that a pest control company, or any entity preparing a Wood Destroying Insect Report, owes a fiduciary duty to all persons that may buy a home that was at any time serviced 14 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 14 of 19

15 by the company, or that may receive a Wood Destroying Insect Report prepared by the company, would represent a radical departure from Mississippi law and represent an untenable expansion of the law of fiduciary duty. The undisputed evidence shows that Terminix disclosed all the information required to be disclosed in the WDIR form. The regulations make it clear that the inspection is based only on a visual inspection of accessible areas, and that the WDIR does not constitute a "warranty" of the absence of wood destroying insects. There is also no fiduciary duty that would impose any obligations onto Terminix beyond what the WDIR regulations require. Insofar as Plaintiffs are basing their claims on Terminix s alleged failure to disclose information that the Bureau does not require Terminix to disclose, such claims fail as a matter of law. B. Any failure by the Terminix Defendants to disclose termite damage at the Property during the inspection did not cause Plaintiffs damages because Plaintiffs already knew about the termite damage to the Property and chose to buy it anyway. Even if Plaintiffs could establish some flaw in the WDIR, Plaintiffs cannot establish that the alleged failures on the part of the Terminix Defendants caused their injuries, or that Plaintiffs reasonably relied on any representation by the Terminix Defendants that the Property was free of old termite damage. To the contrary, it is undisputed that Plaintiffs were informed in no less than four different ways that the Property not only exhibited old termite damage, but also that it had a significant history of termite-related problems. The Disclosure Statement. Well before they bought the Property, Plaintiffs were provided with a copy of the Disclosure Statement. (Ex. 4 at 23: 4-19; 178: 5-9; 181: 5-15) The Disclosure Statement informed Plaintiffs that the Property had been treated for an insect infestation, that damage to the Property had been repaired, and that there was a termite contract on the Property. (See Ex. 3) Although Plaintiffs have taken the position that the Disclosure 15 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 15 of 19

16 Statement was insufficient to notify them about termite-related issues at the Property, this position is unsupported. Plaintiffs admit that the Disclosure Statement concerned them enough to lead them to call Owen, the listing agent, to clarify the nature of the insect problems at the Property. (Ex. 4 at 182: 7-21; 75:24-76:13) Owen, after seeking clarification from Rick Ly, told Plaintiffs that the Property had sustained some termite damage in the laundry room, and that the damage had been repaired. (Id. at 182: 18-21; 76:14-77:1) Thus, even if the Disclosure Statement did not inform Plaintiffs that there were termite problems at the Property, Owen did. The Home Inspection Report. After learning from Owen that the Property had termite damage, Plaintiffs decided to have the Property professionally inspected by Ricky Authement. This inspection and the ensuing Inspection Report eliminate any claim by Plaintiffs that they were unaware of the termite damage to the Property at the time they chose to buy it. The Property inspector, Authement, pointed out the old termite damage to Mr. Spiers during the inspection. (Ex. 6 at 19:5-16). Further, the Inspection Report put Plaintiffs on notice of termite damage to the window in the laundry room and the walls above the foyer entrance. It also identified a problem with the sagging roof over the pool patio. The Inspection Report labeled these items major concerns. These items should therefore have been major concerns to the Plaintiffs, but they apparently did not concern Plaintiffs enough to prevent them from buying the Property. The WDIR. The WDIR again disclosed that the Property had previously been infested with subterranean termites, for which there had been previous treatment. (Ex. 7) It also disclosed numerous conditions at the Property conducive to wood destroying insect infestations, as well as PHD, or potential hidden damage, at the Property. (See id.; see also Ex. 9 at 28: 12-24) The WDIR stated that Durso s inspection did not reveal visible evidence of termites or 16 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 16 of 19

17 damages. (See id.) Even if the Terminix Defendants failed to spot visible evidence of insect damages during the inspection, that does not give rise to liability because Plaintiffs already knew, by way of the Inspection Report, that there was termite damage to the Property in the laundry room and foyer. If Plaintiffs were concerned about any discrepancy between the Inspection Report and the WDIR as relates to the presence of old termite damage at the Property, they could have followed up with Terminix. Again, they did not. (Ex. 4 at 69:1-5; Ex. 6 at 29: 8-13) They testified that they did not have any specific questions about any of the information contained in the WDIR. (Ex. 4 at 74: 6-8; Ex. 6 at 51: 7-10; 79: 12-15) They admit that they did not ask Terminix about the Property s prior termite issues. (Ex. 4 at 69: 1-5) And they admit that they did not attempt to obtain a copy of the Terminix contract for the Property. (Id. at 151:23-152:8) Word of mouth. Plaintiffs were also told on several occasions that the Property had sustained termite damage. The Property inspector, Authement, pointed out the old termite damage to Mr. Spiers during the inspection. (Ex. 6 at 19:5-16) And Owen told Plaintiffs about the termite damage to the laundry room window in response to Plaintiffs initial call after they received the Disclosure Statement. (Ex. 4 at 182: 18-21; 76:14-77:1) In ruling on motions for summary judgment filed by the codefendants, the Court found Plaintiffs were provided with sufficient information regarding the home's termite issues. The Court found as follows: I've been thinking about this for a good while now. I'm looking at a disclosure statement. Any evidence of rot, mildew, vermin, rodents, termites, carpenter ants, or other infestation? And that response is, yes. If I'm not mistaken, that the motion for summary judgment in Ms. Owen's case, counsel for the plaintiff said rot is termite infestation. Have you requested treatment? Yes. Are you aware of repair damage? Yes. Sheet room rot window repaired. And then there is a contract with Terminix. 17 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 17 of 19

18 This put the plaintiff, buyer, on notice that there were issues to the extent that they hired a home repair examiner. After much was disclosed through home repair, they got back in touch with Ms. Owen. They were obviously on notice of something. They asked for an update and they got it. Then Terminix, who by the way had the contract their lawyer was here. And then armed with all this information they go to sale and its an as-is sale. (See November 16, 2017 Hearing Transcript, attached hereto as Ex. 11, pp ). Based on all of the foregoing, there can be no dispute that Plaintiffs had been given sufficient information about the home's prior termite problems to make an informed decision on whether to purchase it. Plaintiffs chose to purchase the home in the face of the substantial amount of information that had been disclosed to them and there is no evidentiary basis to claim that any different or additional disclosures would have caused them to act differently. V.CONCLUSION WHEREFORE, the defendants, The Terminix International Company LP, Richard Norcross, Norman Louviere and Charles Durso, respectfully request that this Court enter a final and appealable order of summary judgment in their favor and against Plaintiffs on all claims, and grant the Terminix Defendants any other relief the Court deems necessary and proper. Respectfully submitted, JERNIGAN COPELAND & ANDERSON By: /s/ Arthur F. Jernigan, Jr. One of the attorneys for defendants, THE TERMINIX INTERNATIONAL COMPANY, LP, NORMAN LOUVIERE, RICHARD NORCROSS, and CHARLES DURSO 18 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 18 of 19

19 Arthur F. Jernigan, Jr. (MSB #3092) JERNIGAN COPELAND ATTORNEYS, PLLC 587 Highland Colony Parkway Ridgeland, Mississippi Phone: Counsel for Defendants The Terminix International Company, LP, Richard Norcross, Norman Louviere and Charles Durso CERTIFICATE OF SERVICE I, Arthur F. Jernigan, Jr., one of the attorneys for Defendants The Terminix International Company, L.P., Richard Norcross, Norman Louviere, and Charles Dorso, do hereby certify that I have this date caused to be notified, via the ECF filing system, a true and correct copy of the above and foregoing to all counsel of record. This the 26th day of April, /s/ Arthur F. Jernigan, Jr. ARTHUR F. JERNIGAN, JR. 19 Case: 24CI2:14-cv Document #: 273 Filed: 04/26/2018 Page 19 of 19