What is the statute of limitations on suing a house seller for lying about code violations and hiding improvements done without a permit?
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What is the statute of limitations on suing a house seller for lying about code violations and hiding improvements done without a permit?
In CO.
Asked on December 17, 2011 under Real Estate Law, Colorado
Answers:
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
You can sue the seller for fraud. The statute of limitations in CO for fraud is three years.
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. This would apply to the lying about the code violations which induced you to rely on those material misrepresentations in order to purchase the house. There is also fraud with regard to the seller's nondisclosure of items the buyer could not have reasonably discovered such as hiding improvements done without a permit.
Your damages (the amount you are seeking to recover in your lawsuit) for fraud would be either benefit of the bargain or out of pocket loss.
Benefit of the bargain means the defrauded purchaser can 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 rule is a determination of damages for fraudulent misrepresentations which permits recovery of the difference between the price paid and the actual value of the property acquired.
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