What happens if the seller of a home commits fraud on disclosure form covered up wood rot termite damage ?
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What happens if the seller of a home commits fraud on disclosure form covered up wood rot termite damage ?
We had to have our foundation repaired due to wood rot termite damage. The
home inspection company performed the inspection with the seller. The termite
company did not report wood rot termite damage. The seller did mutupile
additions to home, 80 there were no permits for this work wasnt inspected for
code violations . The problems are something that we deal with on a daily bases.
Also the roof still leaks even though the seller stated had been repaired. This has
been a nightmare. Please help
Asked on February 11, 2018 under Real Estate Law, Georgia
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 6 years ago | Contributor
Fraud provides a basis to sue for compensation, but for it to be fraud:
1) It must a latent or hidden issue--if you could reasonably perceive it, or your inspector could reasonably perceive it, it is not fraud even if the seller failed to disclose. (This is because it is only fraud if you were justified in relying on the disclosure or lack thereof; if you had some other source of information and did not have to rely on what the seller said, his statements did not harm you and you cannot recover compensation.) So as for the termite or wood rot: if you had a home inspection company, that company should have found and disclosed any issues to you; because you had a professional inspection, you could not rely on the seller's representations and would not seem to have a valid claim in this regard.
2) The seller must have knowingly lied--intentionally withheld information about problems or defects. If the seller did not know of a problem, he did not commit fraud, since he did nothing wrong in failing to disclose something of which he was unaware. So in regards to the roof, if the seller had the repairs done (did not lie about them being done) and was unaware that the leak(s) persisted, he would not have committed fraud--though he would have commited fraud if he lied about the repairs or did know that the leak was still happening but failed nonetheless to tell you about the leak
Therefore, to have a viable case for fraud, the condition must be one which the seller knew of and where you had to rely on what the seller did or did not disclose. And, of course, you must be able to prove these things, at least to a "preponderance of the evidence" (that it is "more likely than not"), since as the person suing, the burden of proof, or obligation to prove your case, rests on you.
For anything were you can prove that the seller knowingly withheld information or lied about a condition or problem that you (or your inspector) could not reasonably find, you could sue based on fraud for the repair costs.
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