Can I sue the prior owners of my house if I find evidence that they did not disclose to me that my entire sewerline would have to be replaced?

This will cost me thousands of dollars. I have owned the house for a year.

Asked on May 23, 2012 under Real Estate Law, Texas


S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

You can sue the seller for fraud.  Fraud is the intentional misrepresentation of a material fact made with knowledge of its falsity and with the intent to induce your reliance upon which you justifiably relied to your detriment.  In other words, you would not have bought the house had you known about the condition of the sewer.

Fraud also applies in cases of nondisclosure in which seller fails to disclose a material fact which buyer could not have reasonably discovered.  You could not have reasonably discovered the true condition of the sewer. 

Your damages (the amount of compensation you are seeking to recover in a lawsuit for fraud) would be either the benefit of the bargain or your out of pocket loss.

Benefit of the bargain means that a defrauded purchaser can recover the difference between the real and represented value of the property regardless of the fact that your actual loss may have been less.

Out of pocket means that the damages for fraudulent misrepresentation  would be the difference between the price you paid and the actual value of the property acquired.

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