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Prudential Ins. Co. of Am. v. Jefferson Assocs. - 896 S.W.2d 156 (Tex. 1995)

Rule:

Negligence requires proof of proximate cause. For violations under the Texas Deceptive Trade Practices--Consumer Protection Act, only producing cause must be shown. Tex. Bus. & Com. Code § 17.50(a). The element common to both proximate cause and producing cause is actual causation in fact. This requires proof that an act or omission was a substantial factor in bringing about injury which would not otherwise have occurred. Producing cause is actual causation in fact.

Facts:

Plaintiff buyer purchased a commercial building from defendant seller under an "as is" agreement. Plaintiff discovered that the building contained asbestos fireproofing, and plaintiff buyer sued defendant seller for fraud, negligence, breach of the duty of good faith and fair dealing, and violations of Tex. Bus. & Com. Code §§ 17.41-.63.  A trial court awarded damages to plaintiff, which the Court of Appeals for the Third District (Texas) affirmed. Defendant seller sought further review.

Issue:

Was defendant seller liable to a buyer who agrees, freely and without fraudulent inducement, to purchase commercial real estate "as is" when the property was later discovered not to be in as good a condition?

Answer:

No

Conclusion:

The court reversed and rendered. Plaintiff agreed to purchase the property with any defects and without any warranties. Plaintiff had contractually disavowed any reliance upon defendant's representations; thus, plaintiff could not prove causation, which was essential to his recovery. There was no evidence that defendant actually knew about the asbestos, and defendant was not liable for failing to disclose information that he did not have. Even if defendant had withheld the building's plans and specifications, the plans did not reveal whether asbestos was used in the building. The only way to determine whether asbestos was present was to inspect the premises, and plaintiff had not claimed that defendant interfered with plaintiff's inspection of the building.

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