Dear Barry,
When we purchased our home, the agent advertised it as “completely renovated,” which included, “new electrical wiring and plumbing.” After we moved in, we had major plumbing problems. When the bathroom wall was opened, we discovered old deteriorated pipes and some faulty wiring. By the time everything was repaired, we had spent over $3,000. The home inspector never disclosed any of these problems, the seller didn’t provide truthful disclosure about the upgrades, and the agent falsely represented the property. We’ve consulted our attorney and he’s offered to file suit. Before doing this, we’d like to get your opinion on the entire matter. – Jesse
Dear Jesse,
If the sellers represented the plumbing and electrical systems as “completely renovated,” then they may be liable for false disclosure. This is assuming that they knew the renovations were incomplete. It is entirely possible that the contractors who performed the electrical and plumbing upgrades falsely represented the completeness of the job. If that is the case, then the sellers could be the first victims in a progression of misrepresentations, rather then the originators of the faulty disclosure.
If the agent represented the renovations as being complete, he or she might also be subject to liability consequences. The agent, however, has a plausible excuse, having relied, in all likelihood, upon seller disclosure and having lacked the expertise to determine the true state of the electrical and plumbing systems. On the other hand, experienced and prudent agents often refrain from making blanket representations that they cannot substantiate, realizing the litigious nature of today’s business climate. Again, we have some gray areas of uncertainty.
Finally, the home inspector may be subject to liability, having failed to report on specific plumbing and electrical defects. However, those defects may not have been apparent on the date of the inspection, since the defective materials were actually discovered within the wall, where no inspector could possibly look. The inspection report might even have indicated that some of the original piping and wiring were still in place, but information of this kind is typically reported in the form of “boiler plate” verbiage, included as descriptive information, rather defect disclosure. Additionally, home inspector liability often depends upon whether the inspector was given the opportunity to re-inspect defects prior to their being repaired. Since the repairs have now been made, that avenue of redress may no longer be open.
As you can see, this is not a black-and-white circumstance with regard to any of the participants in the transaction. Instead, it is one of those situations where a determination of liability is nebulous and uncertain, depending upon an array of unspecified details that are difficult to ascertain, if they can be determined at all.
Sometimes it is not possible to lay blame when bad things happen. Sometimes it is necessary to accept a measure of loss and simply move on to the next chapter of life. For those who don’t agree, there are armies of tort attorneys able and willing to pursue fruitless litigation, constructed on frameworks of subjective allegations, in exchange for excessive legal fees. Knowing what you do about the case, you’ll need to choose the right or left fork in this road.
To write to Barry Stone, please visit him on the Web at www.housedetective.com.
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