LYNCH v. HOMESMART

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE

CATHERINE JANE LYNCH, Plaintiff/Appellant,

v.

HOMESMART, LLC, et al., Defendants/Appellees.

No. 1 CA-CV 25-0840
FILED 07-01-2026

Appeal from the Superior Court in Maricopa County
No. CV2024-024519
The Honorable Christopher Whitten, Judge

AFFIRMED

COUNSEL

Catherine Jane Lynch, Phoenix
Plaintiff/Appellant Pro Se

Jennings Haug Keleher McLeod Waterfall, LLP, Phoenix
By Michael H. Orcutt, John Browder
Counsel for Defendant/Appellee HomeSmart

Law Offices of Kamille R. Dean, PLC, Phoenix
By Kamille Rae Dean
Counsel for Defendants/Appellees Mendoza

LYNCH v. HOMESMART, et al.
Decision of the Court

MEMORANDUM DECISION
Judge Anni Hill Foster delivered the decision of the Court, in which
Presiding Judge David B. Gass and Judge D. Andrew Gaona joined.

F O S T E R, Judge:

¶1 Appellant Catherine Lynch appeals the superior court’s
dismissal of her complaint against HomeSmart, LLC, Julieth Cortes and
Connie Ramirez (“HomeSmart”) and Martha and Joel Mendoza
(collectively “Defendants”). Lynch contends the Defendants failed to
disclose a sinkhole on the property she purchased from them. For the
reasons below, this Court affirms.

FACTS AND PROCEDURAL HISTORY

¶2 This Court “views the facts in the light most favorable to the
non-moving party.” Mirchandani v. BMO Harris Bank, N.A., 235 Ariz. 68, 69,
¶ 2 (App. 2014).

¶3 Lynch made an offer to purchase a house (“Property”) from
the Mendozas through their agent, HomeSmart. During the inspection
period, Lynch discovered a sinkhole on the property noting in her
complaint that while in escrow she visited the Property and discovered a
“huge 400 [sq. ft.] . . . deep hole” in the front yard. Lynch obtained a video
showing that the hole appeared after a monsoon storm a few months before
she made her offer. She emailed the video to Defendants and sought access
to the Property for a soil engineer and earth-moving contractor to diagnose
the issue, recommend remedies and fix any issues before closing. The
Mendozas denied Lynch’s request. Despite the Mendozas’ refusal, Lynch
proceeded with the transaction and closed escrow. About a year later, a
contractor’s van sank in the Property’s front yard.

¶4 Lynch then filed a complaint against the Defendants, and later
amended it, asserting the following claims: (1) breach of fiduciary duty, (2)
fraud and misrepresentation and (3) breach of contract.

¶5 HomeSmart moved to dismiss Lynch’s amended complaint.
The Mendozas joined in the motion and argued dismissal was appropriate
because Lynch failed to state a claim against any defendant. Both the
Mendozas and HomeSmart noted that Lynch’s “claims are not different and

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LYNCH v. HOMESMART, et al.
Decision of the Court

concern the same facts, circumstances, causes of action and elements other
than the agent/principal relationship.” Lynch responded claiming that
Defendants harmed her and argued that HomeSmart had a duty to disclose.

¶6 After briefing, the superior court held oral argument on
HomeSmart’s motion to dismiss. Considering the documents attached to
the complaint and incorporating by reference the Residential Buyer’s
Inspection Notice and Seller’s Response (“BINSR”), the court granted
HomeSmart’s motion and dismissed Lynch’s complaint. It reasoned that
Lynch (1) received actual knowledge of the sinkhole (2) failed to plead
actionable conduct against HomeSmart and (3) failed to establish justifiable
reliance as to any statement or omission against HomeSmart. The court’s
order did not mention the Mendozas when granting the motion. The
Mendozas sought clarification, which the court granted, subsequently filing
a minute entry supplementing its ruling to include the Mendozas and
granting dismissal in their favor on the same grounds as HomeSmart. The
court issued final judgment shortly after. Lynch appealed.

¶7 HomeSmart filed an answering brief, in which the Mendozas
joined. This Court permitted Lynch to file a reply, but Lynch declined. This
Court has appellate jurisdiction. A.R.S. §§ 12-120.21(A)(1), -2101(A)(1).

DISCUSSION

I. Lynch’s opening brief fails to comply with ARCAP 13.

¶8 This Court recognizes that Lynch is a self-represented litigant.
But “a party who conducts a case without an attorney is entitled to no more
consideration from the [C]ourt than a party represented by counsel, and is
held to the same standards expected of a lawyer.” Kelly v. NationsBanc
Mortg. Corp., 199 Ariz. 284, 287, ¶ 16 (App. 2000). Arizona Rule of Civil
Appellate Procedure (“ARCAP”) 13(a)(7)(A) requires that arguments
addressed in an opening brief must contain “appropriate references to the
record” and “citations of legal authorities” to support appellant’s appeal.
See Ritchie v. Krasner, 221 Ariz. 288, 305, ¶ 62 (App. 2009). When a party fails
to comply with ARCAP 13, courts may deem a party’s arguments
abandoned and waived. Ramos v. Nichols, 252 Ariz. 519, 522, ¶ 8 (App. 2022).

¶9 Lynch argues the court erred in (1) finding she had
knowledge of the Property’s defect, (2) failing to determine that
HomeSmart did not disclose the defect to Lynch and (3) reordering the facts
of the case that would have otherwise established justifiable reliance. But
Lynch fails to adequately explain her arguments, references to the record or
substantial explanation. Lynch’s opening brief is also devoid of citations to

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LYNCH v. HOMESMART, et al.
Decision of the Court

authority besides her jurisdictional statement. “An appellant who fails to
make a bona fide and reasonably intelligent effort to comply with the rules
will waive issues and arguments not supported by adequate explanation,
citations to the record, or authority.” Ramos, 252 Ariz. at 522, ¶ 8 (citations
omitted).

¶10 Despite Lynch’s non-compliance with ARCAP 13, this Court,
in its discretion, will address Lynch’s argument on negligent
misrepresentation as this Court understands it and to the extent that Lynch
articulated it. See In re Aubuchon, 233 Ariz. 62, 64–65, ¶ 6 (2013). Lynch
waived any other arguments by failing to clearly articulate and support
them. Id.

II. The court properly dismissed Lynch’s negligent misrepresentation
count.

¶11 This Court reviews dismissal of a complaint for failure to state
a claim de novo. Coleman v. City of Mesa, 230 Ariz. 352, 355, ¶ 7 (2012); see
Ariz. R. Civ. P. 12(b)(6). Dismissal is appropriate when “as a matter of law,
plaintiffs would not be entitled to relief under any interpretation of the facts
susceptible of proof.” Coleman, 230 Ariz. at 356, ¶ 8 (cleaned up) (quoting
Fid. Sec. Life Ins. Co. v. State Dep’t of Ins., 191 Ariz. 222, 224, ¶ 4 (1998)).
Determining whether a complaint states a claim upon which relief can be
granted requires courts to consider the pleading and “assume the truth of
all well-pleaded factual allegations” and their reasonable inferences. Id. at
¶ 9.

¶12 For Lynch to establish a claim for negligent misrepresentation
in the sale of the Property, she must show: (1) a special relationship between
her and Defendants, (2) the special relationship implicated a duty of care,
(3) Defendants provided false information and (4) she justifiably relied on
the misrepresentation resulting in damages. Hammer Homes, LLC v. City of
Phoenix, 256 Ariz. 526, 528–29, ¶¶ 11–13 (App. 2023); Restatement (Second)
of Torts § 552(1). But if Lynch had notice of a condition that could affect her
decision to purchase the Property, she had a duty to investigate. Hill v. Jones, 151 Ariz. 81, 86 (App. 1986); see also Luke v. Smith, 13 Ariz. 155, 162 (1910)
(constructive notice).

¶13 Lynch’s amended complaint broadly alleged that HomeSmart
failed to disclose the sinkhole and intentionally did not disclose it in the
listing. She also claimed that HomeSmart did not disclose this material
defect before entering the contract, attaching the Residential Seller

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Decision of the Court

Disclosure Advisory report (“Disclosure Report”) and portions of the
purchase contract to her complaint.

¶14 In its motion to dismiss, HomeSmart attached the BINSR and
the purchase contract, referenced in Lynch’s amended complaint, in its
entirety. See Cullen v. Koty-Leavitt Ins. Agency, Inc., 216 Ariz. 509, 513, ¶ 8
(App. 2007) (“A contract central to the plaintiff’s claim, [] is not a ‘matter[ ]
outside the pleadings’ for purposes of Rule 12(b)(6)”) (quotation omitted),
vac’d in part on other grounds, Cullen v. Auto-Owners Ins. Co., 218 Ariz. 417
(2008). The purchase contract, executed by the parties in September 2022,
contained a “Buyer Disapproval” clause which provided:

If Buyer, in Buyer’s sole discretion, disapproves of items as
allowed herein, Buyer shall deliver to Seller a signed notice of
the items disapproved and state in the notice that Buyer elects
to either:

(1) Immediately cancel this Contract, in which case:

(a) If Buyer’s notice specifies disapproval of items as
allowed herein, the Earnest Money shall be released to
Buyer.

...

OR

(2) Provide Seller an opportunity to correct the items
disapproved, in which case:

...

(c) If Seller is unwilling or unable to correct any of the
items disapproved, Buyer may cancel this Contract within
five (5) days after delivery of Seller’s response or after
expiration of the time for Seller’s response, whichever
occurs first, and the Earnest Money shall be released to
Buyer. If Buyer does not cancel this Contract within the
five (5) days as provided, Buyer shall close escrow without
correction of those items that Seller has not agreed in
writing to correct.

¶15 The documents showed that during the inspection period,
Lynch completed the BINSR noting the sinkhole and requesting the

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LYNCH v. HOMESMART, et al.
Decision of the Court

Mendozas provide her access to the Property to correct a disapproved
item—the dirt pile caused by the sinkhole. HomeSmart responded to the
BINSR the next day and notified Lynch that “[the Mendozas are] unwilling
or unable to correct any of the items disapproved by Buyer.” Lynch
received the Mendozas’ Disclosure Report the following day. The
Disclosure Report indicated an environmental issue on the Property which
included the seller’s explanation that “[y]ears after I purchased the property
during a monsoon season a hole opened up on the ground, I then filled and
compacted with dirt.” A day later, Lynch signed the BINSR and selected
the box indicating “Buyer accepts Seller’s response to Buyer’s Notice and
agrees to close escrow without correction of those items Seller has not
agreed in writing to correct.”

¶16 Lynch signed the BINSR fully aware of the sinkhole and that
the Mendozas declined to fix it. Rather than exercise her option to cancel
the contract, Lynch proceeded with the transaction. Because she proceeded
with the transaction having full knowledge of the alleged defect, Lynch
cannot state a claim for misrepresentation. See Univ. Inv. Co. v. Sahara Motor
Inn, Inc., 127 Ariz. 213, 215 (App. 1980) (nondisclosure claims are barred
where the defect is known or reasonably discoverable by the buyer).

¶17 Moreover, because misrepresentation requires reliance on
false information, Lynch failed to plead actionable conduct against
HomeSmart and the Mendozas. Hammer Homes, LLC, 256 Ariz. at 528–29,
¶¶ 11–13; see Restatement § 552(1). And even if the Mendozas failed to
initially disclose the sinkhole, HomeSmart corrected the issue through the
Disclosure Report provided before finalization of the transaction. A seller
disclosing some facts while failing to disclose other facts can equate to
misrepresentation. Hill, 151 Ariz. at 84–85. But Lynch’s knowledge of the
sinkhole nullifies her claim. Lynch cannot show that she relied on the
Mendozas’ failure to disclose. Instead, with full knowledge, she proceeded
with the Property’s purchase. Lynch thus failed to state a claim upon which
relief could be granted and the superior court properly dismissed her
complaint.

III. Costs on appeal.

¶18 This Court awards HomeSmart and the Mendozas their
taxable costs on appeal under A.R.S. § 12-341 subject to their compliance
with ARCAP 21.

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LYNCH v. HOMESMART, et al.
Decision of the Court

CONCLUSION

¶19 This Court affirms.

MATTHEW J. MARTIN • Clerk of the Court
FILED: JR

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