Nelson v. Heer
Nevada Supreme Court
163 P.3d 420 (2007)
After a 1998 flood damaged her cabin, Nelson (defendant) made repairs and later sold the cabin to Heer (plaintiff) without disclosing the old flood on the required disclosure form. Heer's insurer later raised his premium and excluded mold coverage upon learning of the prior flood, and Heer discovered elevated mold levels requiring over $80,000 in remediation. Heer sued for breach of contract, intentional and negligent misrepresentation, and breach of the covenant of good faith and fair dealing; the jury found for Heer, and Nelson appealed.
Whether a seller's omission of a material fact constitutes intentional misrepresentation only if the seller was aware of the fact and the omission was a proximate cause of the buyer's damages.