Can you sue for non-disclosure of a flooding basement?
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Can you sue for non-disclosure of a flooding basement?
Home was bought from another company employee (2 years ago) and this individual did not tell us the basement was flooding prior to us buying the home, we later found out he did know and tried to cover it up. We did have a home inspection. The home owners wife was there during the home inspection and I feel the wall with the leaking was covered up by items in the basement so that it was hidden from sight. Today, the foundation is showing water coming through after heavy rains last night.
Asked on April 30, 2012 under Real Estate Law, Kansas
Answers:
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
You can sue the seller for fraud. Fraud is the intentional misrepresentation of a material fact made with knowledge of its falsity and with the intent to induce your reliance upon which you jusitifiably relied to your detriment. In other words, you would not have purchased the house had you known about the basement flooding. You justifiably relied to your detriment on the owner's intentional misrepresentation.
Fraud also applies to to the seller's nondisclosure of a material fact which the buyer could not have reasonably discovered such as your situation where the seller did not disclose the flooding in the basement in order for you to buy the house.
Your damages (monetary compensation you are seeking in your 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 means the damages for fraudulent misrepresentations permits recovery of the difference between the price paid and the actual value of the property acquired.
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