Legal Question in Real Estate Law in California
Non-disclosure of defects by seller
Bought house, seller stated in sales contract that there was a settlement from builder for construction defects. Seller stated settlement was confidential but all defects were corrected proior to sale to us. Seller took attached shelves and window treatments they said would remain - permenately attached. Cost of replacment $2,000.
1 yr after closing paid us the $ and we signed total release 1542. After signed release discovered that lawsuit settlement was $135,000 and seller did not make repairs to foundation, and slab. Cost to repair now $45,000. Am I out of luck. Sellers commited fraud by not revealing in disclosure that were any problems with slab or ground water. Major portion of settlement related to these issues. Realtors also said all repairs were made. Contractor Settlement was sealed.
Am I out of luck because I signed release, even though I would have never signed had I known of other problems not revealed in sales contract disclosure.
1 Answer from Attorneys
Re: Non-disclosure of defects by seller
Your discription of what occurred is unclear. First it is unclear what your referral to 1542 means. Civil code section provides that when one settles a dispute the settlement does not cover unknown problems. If you waived your rights under Civil code section 1542 it may be more difficult to recover damages.
Your inquiry does not state how you determined the amount of the settlement or that none of the repairs had been done. Your source of information will probably be very important in this case. If you learned about the lack of repairs by checking the city reocrds for building permits, you may be out of luck. Building permits are public records and may be obtained by anyone. You or your relator should have checked the city records.
However, the seller intentionally lied to you about making the repairs. You then purchased the property because you relied upon his statement that the repairs had been done. He know that the repairs had not been done.
California law requires the seller to disclose all known defects. Therefore your relieance on the disclosure of the seller was reasonable.
The statute of limitations on fraud is three years from the date of discovery or the date on which you should have reasonably discovered the fraud. The statute of limitations on the failure of the seller to make disclosures may be either shorter or longer.
In California statute of limitations range from one year for torts to four years for contracts. Therefore you should assume that you must move quickly. If you assume that there is a one year statute of limitations from the date of discovery you will be sure to be within the statute.
Your should retain an attorney with experience in real estate law and immediately take action against the seller. You may also want to see if he has any assets that you can attach pending the completion of the case.
The realtor is probably in the same position that you are in, he or she relied on the sellers statements. You may want to include his realtor as a defendant along with the seller.
Lyle Johnson
Lyle W. Johnson Attorney at Law
152 N. Third Street, Suite 510
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