If I purchased a house and due to the previous owner’s negligence I need a new septic system, am I solely responsible for all costs involved?
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If I purchased a house and due to the previous owner’s negligence I need a new septic system, am I solely responsible for all costs involved?
I purchased the house a little over a year ago.
Asked on February 3, 2012 under Real Estate Law, Pennsylvania
Answers:
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
It may be difficult to prove that the problems with the septic system haven't developed since you purchased the house. However, if you are able to prove that the previous owner knew of the problems and failed to disclose them to you, you could sue the previous owner (seller) for fraud.
Fraud is an intentional misrepresentation of a material fact made with knowledge of its falsity and with the intent to induce your reliance upon which you justifiably relied to your detriment. In other words, if you would not have purchased the house if you had known about the septic system problems, you would have a claim for fraud against the seller. Fraud also applies in situations such as yours where the seller did not disclose the problems with the septic system and you, the purchaser of the property, could not have reasonably discovered the problem.
Your damages (the amount of compensation you are seeking to recover in a lawsuit) for fraud would be either the benefit of the bargain or your out of pocket loss.
Benefit of the bargain means a defrauded purchaser may recover the difference between the real and represented value of the property purchased regardless of the fact that the actual loss suffered might have been less.
Out of pocket recovery for fraudulent misrepresentation permits recovery of the difference between the price paid and the actual value of the property acquired.
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