Legal Question in Real Estate Law in New Jersey

Re: Post Home Sale Liability

I suggest writing to the Buyer asking how the condition was discovered. If the condition was only discovered by excess water bills received after the closing, the condition did not exist when the house was sold. Being underground, it was not an apparent pre-closing condition. Consistent water bills to you would verify this. You can write the Buyer, specifically disclaiming any responsibility, but offering a good-faith payment in the amount of your estimate, which should also be enclosed with the letter. All letters should be sent by certified mail, return receipt requested. There is no telling how a court would decide this issue, although you committed no fraud for a non-apparent condition. The prior water bills should verify your non-knowledge. More than one estimate would be required by the Buyer and your estimate would also be considered in assessing damages if it is determined you are responsible. Your letters are not evidence in litigation and they can say that they are written without prejudice and may not be used as evidence if the matter goes to litigation, and are sent merely to settle a disputed claim.

Re: Post Home Sale Liability

Your questions and fact pattern are classic law school issues. I concur with Messers Rothberg and Le Vine but add, for what it's worth, that I believe your chances to prevail in court should be very good given the problem was not apparent, the Buyer had a professional inspection and carries the burden to prove that you had prior knowledge. However, this is only an educated guess, as no lawyer will tell you that a judicial decision, either way, is a slam dunk. Good luck.

Re: Post Home Sale Liability

Trying to predict what a court will do is like trying to predict the weather. I would say that a sewer line is underground and therefore would be something that you are presumed to have no knowledge of. The buyers would have to produce evidence that you had knowledge. I would say that a court would require the buyer to produce 2-3 estimates. You could produce an estimate into evidence as well. The fact that you offered to settle is not permissable evidence under the rules of evidence and will have no bearing on your liability. The question gets down to whether the defect was latent or apparent. I think you have the better position in this case.