Real Estate Sale – Latent Defects
What follows is excerpted from a trial brief Brian Stutheit recently filed on behalf of his clients. The reader will see that the law leaves a lot of room to argue whether or not non-disclosure of a physical defect is “actionable”, or
giving sufficient reason to take legal action. Many non-disclosure cases can go either way at trial. Lawyers need experience with these cases, so they know how to develop and present facts and expert opinions which support their clients’ case. Important facts often come from the buyer, the seller, building and planning officials and their records, realtors, neighbors, and construction professionals.
A seller of real estate has a duty to disclose to his purchaser a known latent defect, and his failure to disclose amounts to concealment, making him vulnerable to a suit based upon fraud. A “latent defect” is not observable, or discoverable through reasonable inspection. To prevail on a claim of fraudulent concealment, a property buyer must show that a seller actually knew of a material fact that was not disclosed. It is not enough that the seller should have or might have known this fact. Additionally, the plaintiff must show that the defendant’s intent was to cause the plaintiff to act differently than she might otherwise have done if the information had been disclosed. Actionable concealment consists of (a) the concealment of a material existing fact which in equity and good conscience should be disclosed; (b) knowledge that one is concealing such a fact; (c) ignorance on the part of the one from whom such fact is concealed of the existence of the fact concealed; (d) intention that the concealment be acted upon; and (e) resultant damage.