I’m Eric Lanigan of Lanigan and Lanigan attorneys in Winter Park, Florida. Today I am going to answer some of the most frequently asked questions sellers have about the seller’s property disclosure form and the role of the inspector when selling a home.
Sellers Should Disclose Everything
Q: From the seller’s perspective, what happens if I purposely don’t disclose a problem with the home?
Then you have a real problem. And non-disclosure is the number one reason why buyers of homes end up suing the sellers of homes.
Now, at what level do you have to disclose a problem? Generally, the law will say that the problem needs to be substantial in nature such that it materially affects the value of the property or will involve a significant cost of repair.
So, if you have a door that has a broken lock and you don’t disclose it, is that going to be a problem? No. If you’ve got known termite damage, known sinkhole damage, known black mold problems and you don’t disclose it then you’ve just bought yourself a much bigger problem because the buyer will inevitably find that problem and you’re going to get sued.
Home Inspectors Do Not Always Find Everything
Q: What happens if there’s a problem that comes up that I had no idea was wrong because I had a home inspection that didn’t disclose the problem?
Well, you can only be liable for non-disclosure in the event there is either a negligent or an intentional misrepresentation. And a misrepresentation can occur by what you don’t tell just as it can occur by misrepresenting what you do know.
Now, if in fact you’ve got a problem in the property and you don’t know about it and the home inspector doesn’t find it, then you can’t be under a duty to disclose something you didn’t know about.
So, those kinds of latent defects those kinds of hidden defects the buyer may still try to sue you depending upon the significance of the problem but they are going to have to establish that you knew or should have known the problem was there and the more latent or hidden the defect or problem is the less likely it is that they’re actually going to be able to prove that you knew it was there.
Liability for the Home Inspector
Q: What liability does a realtor have who recommends the inspector?
Just recommending somebody doesn’t create liability if that somebody ends up not doing a good job. The realtor would have to know or have reason to know that the inspector is consistently having issues in failing to find problems with homes.
Now obviously that’s going to be a rare situation and it’s going to be very difficult to prove. So, generally speaking does a realtor have liability just because they recommended a particular home inspector? Generally, the answer to that is no. There’s going to have to be some specific or unique circumstance.
In the second part of this three part series, Eric Lanigan will address legal options available if a buyer fails to disclose a known defect in the property.