Burbach v. Radon Analytical Laboratories, Inc.

Summary

The Iowa Supreme Court held that a home relocation inspection company could owe a duty of care to a prospective home buyer who foreseeably relied on its inspection report, despite the absence of contractual privity. Applying Restatement (Second) of Torts section 552 and Iowa precedent, the court reversed summary judgment for the inspection company and remanded for further proceedings.

Holdings

1. A home inspection company may owe a duty of care to a prospective home buyer who is not in privity with the company when the company knows its report will be disclosed to and potentially relied upon by a limited but foreseeable class of prospective buyers.
2. Summary judgment was improper because the record contained at least colorable evidence supporting Burbach's claim that Radon negligently breached the duty owed to him.

Questions Presented

1. Whether a home inspection company owes a duty under Restatement (Second) of Torts § 552 to a prospective home buyer who is not in privity with the company but foreseeably receives and relies on the inspection report.
2. Whether the district court properly granted summary judgment on the ground that Radon owed Burbach no duty of care.

Disposition

reversed_and_remanded