Is the seller responsible for any damages since they did not disclose a flooding problem?
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Is the seller responsible for any damages since they did not disclose a flooding problem?
I bought my house 2 years ago and the basement floods. The seller mentioned nothing of the flooding, however, all of the neighbors knew the house flooded badly. The neighbors also said that there was no carpet downstairs because it flooded so bad. he house had been foreclosed on and a company bought it, flipped it, and sold it to me. Now my dad and I think they put up new dry wall over the exisiting to hide the water damage. Is there anything that can be done?
Asked on May 15, 2012 under Real Estate Law, Ohio
Answers:
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
You could 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 justifiably relied to your detriment. Fraud also applies in cases of nondisclosure by the seller when the buyer could not have reasonably discovered the true facts.
The seller did not disclose the flooding in order to induce your reliance upon which you justifiably relied to your detriment. In other words, you would not have purchased the house if you had known about the flooding.
Your damages (the amount of compensation you are seeking in your lawsuit for fraud against the seller) would be either the benefit of the bargain or your out of pocket loss.
Benefit of the bargain means that a defrauded purchaser can recover the difference between the real and represented value of the property purchased regardless of the fact that your actual loss may have been less.
Out of pocket is a determination of damages for fraudulent misrepresentation which permits recovery of the difference between the price paid and the actual value of the property acquired.
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