Suing Home Seller For Misrepresentation

If you are selling a house, you must understand not only your disclosure obligations but also the potential adverse legal ramifications for failing to make a required disclosure.

Examples of “defects” necessitating disclosure include structural and mechanical issues, such as water infiltration, as well as non-physical defects that can adversely affect the value of the property, such as easements, zoning or tax/assessment issues.

The key question for sellers is, what is a required disclosure? Should you disclose as little as possible or everything that could potentially be considered a defect?

When trying to answer these questions, sellers should be mindful of the fact that real estate agents are not attorneys and that he or she may be motivated to finalize the sale as effortlessly as possible rather than reducing clients’ potential liability to the buyers.

For this reason, it is often useful to involve an attorney on the front-end of a sale in order to avoid the potential of being sued for failure to disclose a defect after the sale.

For example, selling a house “as-is” does not protect against a lawsuit alleging active concealment of a material defect. When considering selling your house “as-is,” it is very important to know all the potential liability that selling “as-is” does not shield you from.

Failing to disclose or concealing a defect can lead to a variety of potential damages. First, buyers can sue for breach of contract and intentional misrepresentation and seek either rescission of the sale or the costs to repair the alleged defects. In addition, buyers almost universally bring a cause of action that offers the potential of recovering multiplied damages and recovery of their attorney’s fees.

Finally, if after selling your home you receive a demand letter from the buyer’s attorney seeking damages relating to undisclosed defects or misrepresentations regarding the condition of the property, or if you are served with a summons and complaint, it is vitally important that you contact an attorney to assist with your response to these allegations.

Source: https://www.bizjournals.com/milwaukee/news/2019/05/01/seller-beware-failure-to-disclose-during-home-sale.html

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.