Legal Question in Business Law in California

Disclaimer: The materials provided below are informational and should not be relied upon as legal advice.

If you are selling used equipment, you should disclose that the equipment is previously used.

Generally speaking, the answer is "no," because a seller has a common-law duty to disclose facts within his knowledge that would affect a buyer's perception of the value of the thing offered for sale. There are exceptions. These would include situations where the seller truly has no knowledge regarding prior use, where the prior use is obvious (for example, if the item were a 1947 John Deere tractor), where the item is offered "as is," or where the prior use has little or no impact on the value of the item. This position of the law is a change in the last century or two from the attitude of the courts in the 18th Century and before where the policy of the law was "caveat emptor" (let the buyer beware).

It depends on whether your silence would be deceptive. If the buyer would know, or through the exercise of reasonable inspection would know it was used, you do not have to disclose. The 1947 John Deere being a clear example. If you know or have reason to know the buyer believes it to be new, then it is fraud not to disclose.