Stambovsky v. Ackley

Stambovsky v. Ackley
New York Supreme Court, Appellate Division, First Department

Decided July 18, 1991
Full case name Jeffrey M. Stambovsky v. Helen Ackley and Ellis Realty
Citations 169 A.D.2d 254, 572 N.Y.S.2d 672, 60 USLW 2070
Prior history New York Supreme Court dismissed the action (April 9, 1990)
Main Holding
Seller who had undertaken to inform the public at large about the existence of poltergeists on the premises to be sold was estopped to deny existence of poltergeists on the premises, so the house was haunted as a matter of law and seller must inform the purchaser of the haunting.
Court membership
Presiding Justice Milonas
Associate Justices Ross, Kassal, Smith, Rubin
Case opinion
Decision by Rubin
Joined by Ross, Kassal
Dissent by Smith, Milonas

Stambovsky v. Ackley, 169 A.D.2d 254 (N.Y. App. Div. 1991), commonly known as the Ghostbusters ruling, is a case in the New York Supreme Court, Appellate Division, that held that a house, which the owner had previously advertised to the public as haunted by ghosts, was legally haunted for the purpose of an action for rescission brought by a subsequent purchaser of the house. Because of its unique holding, the case has been frequently printed in textbooks on contracts and property law and widely taught in U.S. law school classes, and is often cited by other courts.

Facts and prior history

During the course of her ownership of the property at issue, which was located in Nyack, New York, Helen Ackley and members of her family had reported the existence of numerous poltergeists in the house. Ackley had reported the existence of ghosts in the house to both Reader's Digest[1] and a local newspaper on three occasions between 1977 and 1989, when the house was included on a five-home walking tour of the city. She recounted to the press several instances in which the poltergeists interacted directly with members of her family. She claimed that grandchildren received "gifts" of baby rings, all of which suddenly disappeared later. She also claimed that one ghost would wake her each morning by shaking her bed. She claimed that when spring break arrived she proclaimed loudly that she did not have to wake up early and she would like to sleep in; her bed did not shake the next morning.

Neither Ackley nor her real estate broker, Ellis Realty, revealed the haunting to Jeffrey Stambovsky before he entered a contract to purchase the house in 1989 or 1990. Stambovsky made a $32,500 downpayment on the agreed price of $650,000 for the house.[2] Stambovsky was from New York City and was not aware of the folklore of Nyack, including the widely known haunting story.

When Stambovsky learned of the haunting story, he filed an action requesting rescission of the contract of sale and for damages for fraudulent misrepresentation by Ackley and Ellis Realty. Stambovsky did not attend the closing which caused him to forfeit the downpayment (although he was then not obligated to buy the house).[2] A New York Supreme Court (trial court) dismissed the action, and Stambovsky appealed.

The case

Majority opinion

Near the beginning of the majority opinion (three out of five justices) appears its most well-known conclusion: "having reported [the ghosts'] presence in both a national publication... and the local press... defendant is estopped to deny their existence and, as a matter of law, the house is haunted." The court noted that regardless of whether the house was truly haunted or not, the fact that the house had been widely reported as being haunted greatly affected its value.

Notwithstanding these conclusions, the court affirmed the dismissal of the fraudulent misrepresentation action and stated that the realtor was under no duty to disclose the haunting to potential buyers. Thus, no damages were available to Stambovsky because New York, at the time, adhered to property law doctrine of caveat emptor.

The appellate court reversed the trial court's decision regarding the rescission action, however, as it went on to note that "haunting" was not a condition that a buyer or potential buyer of real property can and should be able to ascertain upon reasonable inspection of the property. According to the court, though the doctrine of caveat emptor would normally operate to bar a rescission action, causing seller to have no duty to disclose information about the property to be sold (but also preventing the seller from affirmatively misrepresenting the condition of the property), the doctrine, in a merged law and equity system, can be modified to do justice to the parties. In this case, "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," thus equity would allow Stambovsky the remedy of contract rescission against the seller, Ackley. The court held:

Where, as here, the seller not only takes unfair advantage of the buyer's ignorance but has created and perpetuated a condition about which he is unlikely to even inquire, enforcement of the contract (in whole or in part) is offensive to the court's sense of equity. Application of the remedy of rescission, within the bounds of the narrow exception to the doctrine of caveat emptor set forth herein, is entirely appropriate to relieve the unwitting purchaser from the consequences of a most unnatural bargain.

The opinion makes reference to a number of popular books and films featuring ghosts, including Shakespeare's Hamlet and the 1984 movie Ghostbusters and uses supernatural idioms throughout (e.g., "plaintiff hasn't a ghost of a chance", "I am moved by the spirit of equity", and "the notion [...] is a hobgoblin which should be exorcised from the body of legal precedent").

Dissenting opinion

The dissenting opinion argued that the doctrine of caveat emptor should be strictly applied and would affirm the trial court's dismissal of all of the actions. Displeased by the majority's basis for its holding, the dissent said, "Finally, if the doctrine of caveat emptor is to be discarded, it should be for a reason more substantive than a poltergeist. The existence of a poltergeist is no more binding upon the defendants than it is upon this court."

Epilogue

The case generated considerable publicity. Among the new prospective buyers to the house at 1 LaVeta Place on the Hudson River was Kreskin (who was interested in it because of the haunted claim).[2] Ackley sold the house to another buyer and moved to Florida in 1991. In 1993, Bill Merrill and Glenn Johnson, who claimed to be paranormal investigators, claimed to have contacted the ghosts from Portland, Oregon with the aid of Helen Ackley. The ghosts were reported to have told them that it wasn't as much fun haunting the house without Helen.[3] They wrote a story about the event called Sir George The Ghost Of Nyack.[4] Helen Ackley died in 2003. There have not been public reports of hauntings in recent years.[3]

See also

References

  1. ↑ Helen Herdman Ackley (May 1977). "Our Haunted House on the Hudson". Reader's Digest. p. 217.
  2. 1 2 3 Phones Ringing (Eerily?) For Nyack Spook Home - New York Times - March 20, 1990
  3. 1 2 Ghost of Nyack - Ghost Update - Kavanagh webpages -comcast.com - Retrieved March 14, 2009
  4. ↑ Merrill, Bill; Johnson, Glenn (1995). Sir George The Ghost Of Nyack. Deer Publishing Co. ISBN 1-883832-05-5.

External links

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