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Co-Chair, Special Education Law Practice Group

Portrait of Christopher J. Conrad

Legal Updates for Real Estate E&O Liability

When Is a Symbol of Hate Not a Material Defect in Property?

Legal Updates for Real Estate E&O – February 2026

February 1, 2026

by Christopher J. Conrad

Daniel and Lynn Rae Wentworth purchased a home in Beaver County, Pennsylvania from Juergen Steinmetz. According to their complaint, after moving into the home, the Wentworths discovered a swastika under rugs in the basement and what they perceived to be a Nazi eagle incorporated into the floor tile pattern.

The Wentworths claimed that had they previously known about the symbols in the floor tile, they would not have purchased the home. They also alleged that they could not be expected to live in the home in that condition, nor could they sell the home, and that it would cost $30,000.00 to remove the symbols and replace the floor tile. The Wentworths filed suit against Steinmetz under the Pennsylvania Real Estate Seller Disclosure Law (RESDL), alleging he failed to disclose a “material defect” in the property prior to closing, seeking compensatory and punitive damages.

Steinmetz filed preliminary objections in response to the complaint denying creating the floor pattern in support of Nazism. Steinmetz argued that the swastika is an ancient symbol embraced by various world cultures, and that its existence predates use by the Nazis. Yet, the Wentworths argued that since the swastika in the floor, “styled in the fashion that [was] used by the Nazis,” was situated in such close proximity to the German eagle, no reasonable person could believe the symbols were intended to be imagery referencing any other culture. For purposes of resolving the preliminary objections, the court set aside Steinmetz’s “subjective intent” and accepted the Wentworths’ allegations that these were indeed pro-Nazi symbols, and would be viewed as such to guests in the home or to prospective buyers.

Steinmetz also argued that even accepting the Wentworths’ allegations as true, the symbols in the floor tile were not a “material defect” that he was required to disclose to prospective buyers. Relying in part on Milliken v. Jacono, 103 A. 3d 806 (Pa. 2014), he argued that attributes of a property giving rise to a psychological stigma, like the alleged Nazi symbols in the floor, are not material defects required to be disclosed under the RESDL. The trial court agreed, and found that Milliken foreclosed the Wentworths’ claims. Although the trial court recognized the imagery in the floor was “disturbing,” it was still merely a cosmetic flaw that could be covered up, and it was not a physical or structural property that posed an unreasonable risk or an impediment to the use and enjoyment of the property. The trial court sustained the preliminary objections and dismissed the complaint.

On appeal, the Pennsylvania Superior Court revisited Milliken, considering whether the occurrence of a murder and suicide in a home was an undisclosed material defect justifying a cause of action. The Supreme Court in Milliken concluded it was not, reasoning the deaths did “not constitute an actionable material defect,” and in so holding noted the myriad “traumatizing events that could occur on a property” and that “[e]fforts to define those that warrant mandatory disclosure would be a Sisyphean task.” Milliken, 103 A. 3d at 807, 810.

The Superior Court agreed and concluded the Wentworths’ claims failed “because they suffer from the same lack of an objectively-quantifiable flaw as the one alleged in Milliken.” The Superior Court further reasoned:

In each scenario, the existence, and degree, of the defect is in the eye of the beholder. Certainly, a significant portion of homebuyers would eschew a house with a crude mosaic of Nazi iconography in its basement. Yet there is, sadly but undeniably, a segment of the population who would deem it an asset to the property. Further, even among the majority of prospective buyers who would not welcome having hate symbols adorning their basement floor, the degree to which the images impacted the value of the property would inevitably vary from person to person.

Relying on Milliken, the Superior Court noted, “that condition of the property constituting a material defect must be one that not only substantially impacts the value of the real estate, but lends itself to recognition and quantification by objective standards.” Although the Superior Court was sensitive to “the Wentworths’ outrage [and] their concern that the existence of the images could taint them as Nazi supporters,” still the court found “that that the symbols on the Wentworths’ otherwise sound and functional tile floor do not constitute a material defect that Steinmetz had a duty to disclose.” The decision of the trial court was affirmed.

 Although the seller in Wentworth was successful in defending the lawsuit, real estate professionals should still discuss with their seller clients whether there may be a hidden aesthetic characteristic in the home that a potential buyer might find to be offensive, particularly if it is not discovered until after closing. While such a characteristic ultimately may not arise to a “material defect” under the RESDL, it still could lead to costly litigation that the seller (and perhaps the seller’s agent and broker) might have to defend.  Real estate professionals may wish to advise their seller clients to remove any such hidden characteristic even before the property is listed for sale. This will help to avoid needless litigation down the road and also likely will expand the pool of potential buyers.

For further reading, see: Wentworth v. Steinmetz, 2025 PA Super 253, --- A. 3d --- (2025).

Firm Highlights

Thought Leadership

Commonwealth Court Holds That a Claimant Who Was Struck By a Car While Crossing the Street During an Unpaid Break Was In the Course and Scope of Employment

This case involved a claim petition filed by a claimant who sustained injuries after being struck by a vehicle while crossing the street in front of the employer’s premises. The employer denied the claim based on course and scope, as the accident occurred during one of two mandatory fifteen (15) minute breaks provided to the claimant. The claimant would punch out at the beginning of a break and punch back in when the break was over.  On the date of the incident, the claimant punched out and left the building to get lunch at a restaurant, which required her to cross the employer’s parking lot, and then a public street, where the injury occurred. The Workers Compensation Judge (WCJ) dismissed the petition, noting that that during the two mandatory fifteen-minute breaks per shift allowed by the employer, the claimant was free to leave the employer’s premises, and during breaks, permitted to engage in whatever activity she desired. The WCJ found that at the time of the accident, the claimant was on her own time, in the middle of the street, and going to get lunch.   The claimant filed an appeal with the Worker’s Compensation Appeal Board (Board), and the Board reversed.  According to the Board, the claimant’s location was still on the employer’s premises, as the claimant was taking her customary route while using a reasonable ingress/egress from the employer.  Further, the Board found that the “Personal Comfort Doctrine” applied, as the claimant was on a momentary departure to take care of her personal comfort, within the window of time she was allotted for her break.  The Board remanded the case, and a WCJ granted the claim petition.  The Board affirmed, and the employer appealed to the Commonwealth Court. Before the Court, the employer argued that the claimant was not in the course and scope of her employment, because the injury did not occur on its premises, and the claimant was outside the bounds of the Personal Comfort Doctrine. The Court, however, rejected these arguments, and dismissed the employer’s appeal.  The Court noted that the break given to the claimant was so cursory, when she set out to relieve her hunger for her own personal comfort,  she remained in the course of her employment when she sustained her injuries.  A Petition for Allowance of Appeal in the Supreme Court has been filed by the Employer, Giant Eagle.

Thought Leadership

New Jersey Workers’ Compensation Legislation Updates

Since June 1, 2026, there have been no new New Jersey workers’ compensation related cases from the Appellate or Supreme Courts. As such, below will highlight any new legislative updates since February. A1023 | S3984 - Medical Use of Cannabis Under Certain Circumstances This requires workers’ compensation, PIP, and health insurance coverage for the medical use of cannabis under certain circumstances. It was introduced on January 13, 2026 and referred to the Assembly Financial Institutions and Insurance Committee. It was also introduced on March 19, 2026 and referred to the Senate Commerce Committee. A1045  - Certain Injuries to Volunteer and Professional Public Safety and Law Enforcement Personnel This revises workers’ compensation coverage for certain injuries to volunteer and professional public safety and law enforcement personnel. It was introduced on January 13, 2026 and referred to the Assembly Labor Committee. A1384 | S2757 - Reduce Statute of Limitations in Medical Fee Disputes This reduces statute of limitations from six years to two years in medical fee disputes in workers’ compensation matters. It was introduced on January 13, 2026 and referred to the Senate Labor Committee. It was also introduced on the same day and referred to the Assembly Labor Committee. A1870 | S1379 - Workers' Compensation Benefits For Certain Workers Due to September 11, 2001 Terrorist Attacks This provides workers’ compensation benefits for certain public safety workers who developed illness or injury as result of responding to September 11, 2001 terrorist attacks. It was introduced on January 13, 2026 and referred to the Assembly Labor Committee. It was also introduced on the same day and referred to the Senate Labor Committee. On February 5, 2026, it was reported from the Senate Committee, 2nd Reading, and referred to the Senate Budget and Appropriations Committee. A2779 | S1521 - Excludes Certain Illegal Aliens This excludes certain illegal aliens from workers’ compensation and temporary disability benefits. It was introduced on January 13, 2026 and referred to the Senate Labor Committee. It was also introduced on the same day and referred to the Assembly Labor Committee. A2792 | S1555 -  Prevent Intoxicated Employees from Workers’ Compensation This prevents intoxicated employees from receiving workers’ compensation. It was introduced on January 13, 2026 and referred to the Senate Labor Committee. It was also introduced on the same day and referred to the Assembly Labor Committee. A3167 | S2372 - Workers’ Compensation Insurance Requirements for Certain Corporations and Partnerships This concerns workers’ compensation insurance requirements for certain corporations and partnerships. It was introduced on January 13, 2026 and referred to the Senate Labor Committee. It was also introduced on the same day and referred to the Assembly Labor Committee. A3548 | S3571 – Maximum Benefits for Certain Volunteers This provides certain volunteer and other workers with maximum compensation benefit for workers' compensation claim regardless of outside employment. It was introduced on January 13, 2026 and referred to the Senate Labor Committee. On March 2, 2026, it was reported from the Senate Committee, 2nd Reading, and referred to the Senate Budget and Appropriations Committee. It was also introduced on the same day and referred to the Assembly Labor Committee. On May 7, 2026, it was reported and referred to Assembly State and Local Government Committee. A3724 - Personal Liability to Employer Officers for Failure to Pay for Coverage This provides personal liability for owner, executive officer, or executive director of employer for failure to pay for workers' compensation coverage. It was introduced on January 13, 2026 and referred to the Assembly Labor Committee. On May 7, 2026, it was reported and referred to Assembly Judiciary Committee. A4617  - Certain Workers' Compensation Supplemental Benefits and Funding Method This concerns certain workers' compensation supplemental benefits and funding method. For a permanently and totally disabled worker or surviving dependents after December 31, 1979, with some exceptions, this bill provides for an annual cost of living adjustment in the weekly workers’ compensation benefit rate. It was introduced on March 10, 2026 and referred to the Assembly Labor Committee. S241 - Inclusion in Database of Appointed Officials This requires that workers’ compensation judges and administrative law judges be included in database of appointed officials. It was introduced on January 13, 2026 to the Senate, Referred to Senate State Government, Wagering, Tourism & Historic Preservation Committee. S2290 -  Mandatory Retirement Age This increases statutory mandatory retirement age for Supreme Court Justices, Superior Court Judges, Tax Court Judges, Administrative Law Judges, and Workers’ Compensation Judges from 70 to 72. It was introduced on January 13, 2026 and referred to the Senate Judiciary Committee. S3144 - Testimony in Workers’ Compensation This concerns submission of testimony in workers’ compensation claims. It was introduced on January 13, 2026 and referred to the Senate Labor Committee. S3342  - Increase Mandatory Retirement Age This increases statutory mandatory retirement age for Supreme Court Justices, Superior Court Judges, Tax Court Judges, Administrative Law Judges, and Workers’ Compensation Judges from 70 to 75. It was introduced on February 5, 2026 and referred to the Senate Judiciary Committee.

Thought Leadership

Appellate Court Rejects Horizontal Immunity Defense to Company Not Acting as Statutory Subcontractor

The First District Court of Appeal held that a property management company was not entitled to horizontal immunity under section 440.10(1)(e), Florida Statutes, in a negligence action brought by an employee of another company working on the property. The claimant was injured while servicing a swimming pool at an apartment complex. His employer had contracted with the property owner to maintain the pool. Following the accident, the claimant received workers' compensation benefits through his employer’s carrier. The claimant subsequently filed a negligence action against the property management company, alleging that it failed to maintain the premises in a reasonably safe condition and failed to warn him of a dangerous condition that caused his injuries. The property management company had been retained by the property owner to maintain the complex in good operating condition and to perform routine maintenance and repair work. The property management company argued that it was immune from suit under section 440.10(1)(e) of Florida’s Workers’ Compensation Law. That provision grants immunity to a subcontractor providing services in conjunction with a contractor on the same project or contract work from civil actions brought by employees of another subcontractor, subject to limited exceptions. According to the property management company, it qualified as a subcontractor working on the same project as the claimant’s employer and was therefore entitled to horizontal immunity. The trial court agreed and entered summary judgment in its favor. On appeal, however, the claimant argued, and the appellate court agreed, that horizontal immunity applies only when a contractor has sublet work arising from a contractual obligation owed to a third party. The court noted that prior decisions consistently held that an entity acting solely on its own behalf as the owner of property, rather than pursuant to a contract with a third party, is not a “contractor” under section 440.10(1), even when it hires other companies to perform work on the property. In Teed, the property management company could not establish that the property owner had a primary contractual obligation to a third party to maintain either the apartment complex or the swimming pool, which it then delegated to the claimant’s employer or the property management company. As a result, the property owner did not qualify as a statutory contractor, and the property management company was not a subcontractor entitled to horizontal immunity under section 440.10(1)(e). The First District therefore reversed the lower court’s ruling and remanded the case for further proceedings on the claimant’s negligence claim.