Can Buyer Sue Seller After Closing
Imagine buying a home for you and your family. You go through all the correct processes, then finally sign the sales contract with the seller. The seller does not disclose that there any major defects with the home. The sale closes, and you and your family moves in,
After a few weeks or months, you might notice problems; very low water pressure on the second floor, or an outbreak of mold in the basement, or that termites are destroying the structural integrity of the front porch. Why wasn’t this disclosed to you prior to the sale? If there were material defects concealed within your house at the time of purchase, did the seller or the seller’s agent have a legal obligation to disclose them to you? In some cases, depending on the facts and whatever evidence you can round up, you might be able to recover some portion of the repair costs from the seller.
Basic Limitations on Home Defect Litigation
Home defects may be noticed days, weeks, or years are the sale. What sorts of newly discovered defects might make the person who sold you the house legally liable for their repair?
Normally, only defects that are material and that you didn’t know about–but the seller did–at the time of sale will allow you to recover from the seller. First, you probably knew before the sales contract was signed that the house was not in perfect condition. Issues, such as aging plumbing, the seller may have disclosed to you in the course of the sale, most likely through written disclosure forms (required in most U.S. states). If you knew or should have known about a defect, and chose to buy the home anyway, a court will not allow you to sue the seller. There may also be situations where not even the seller knew about the defect. If, for example, an underground septic tank or sewage line was leaking, and the seller knew nothing about it, you may not sue the seller. Buyers can not be able to sue for financially inconsequential defects, regardless of whether or not those defects were disclosed. Houses do not have guarantees. The normal processes of aging and decaying, leaves buyers to deal with the consequences. In order to sue, defects must be material, known to the seller, and unknown to you at the time of sale if you are to have a reasonable chance of recovery.
Who Is Responsible for Hidden or Undisclosed Home Defects?
If you believe that you have discovered a material defect that the seller never disclosed to you prior to the sale of the home, There are three possible responsible parties, each of whom may have some portion of the liability:
The Seller
Nearly every state has laws requiring sellers to advise buyers of certain known, material defects in the property. Depending on the jurisdiction, this responsibility can override an “as is” clause contained within a purchase contract. The standard disclosure form asks the seller to state whether the property has certain features (like appliances, a roof, a foundation, systems for electricity, water, and heating, and more) and then rate or describe their condition. The seller is not usually required to actively inspect for problems. But if there are obvious problems about which the seller should have known, but failed to disclose, a court may think the seller purposely failed in his or her duties. The same is true if the seller purposely tried to hide a defect.
The Seller’s Real Estate Agent
Some states’ laws make sellers’ agents liable for failing to disclose problems they observed or were told of by the sellers. In some states, agents can lose their licenses for engaging in deceitful conduct.
Your Home Inspector
Normally, home inspectors provide a full evaluation of the home’s condition prior to closing. The inspector should have spotted problems that the seller perhaps never knew. If the inspector missed problems that an expert (a professional peer) should have noticed, the inspector may face some liability. Read over your inspection report to see what, if anything, it said about an area where there is an issue. Some buyers are embarrassed to find that the problem is described right in the report, or that the problem falls within an area that the inspector correctly did not include in the report.
Filing a Lawsuit: A Last Resort For Resolving The Conflict
If the amount of damage and the associated costs in dispute is simply too much to walk away from, however, then litigation might be the best option. There are a number of legal causes of action that you might be able to assert against the seller, seller’s agent, or home inspector:
- failure to disclose a defect
- negligence
- fraud
- breach of contract
- breach of warranty, or
- negligent misrepresentation.
Craig Cherney is a trusted client advisor and a sought after real estate lawyer and expert witness who is hired by the nation’s top Real Estate Litigation Attorneys to help resolve their litigated real property matters. Craig has appeared as a testifying expert witness before judges and juries in California, Arizona, Nevada and other jurisdictions across the country. Craig Cherney, Esq. Expert Witness Real Estate. 480-399-2342. If you are litigating an easement case, Craig Cherney might be able to help you advance and win your case.