What can I do if I bought a condo and the seller completed disclosure form confirming there were no known defects but that was inaccurate?

About 4 days after moving in (and using the master shower), the neighbor below us complained of a leak that she and the previous owner discussed a year ago. The previous owner has since confirmed that he did talk to the neighbor about the leak, “checked it out” on his own, and decided nothing was wrong. The issue stopped (possibly because the previous owner resorted to using the guest shower). I am now dealing with a plumbing issue that is likely going to exceed $2,000. I’m looking for any advice or input in the success I could have in recouping expenses from seller.

Asked on December 15, 2015 under Real Estate Law, Illinois

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

The issue is whether this was an intentional lie or not. If the leak had not been reported for a year, then the owner could have legitimately thought there was no issue. On the other hand, if the owner knew or suspected that the leak was still ongoing but circumvented it by using the other shower, then she knew there was a problem and lied about  it in the disclosures, which would be fraud. 
If the seller committed fraud, then she could be liable for your costs to repair or correct the condition and any damage it did. The problem would be proving what the seller knew or reasonably must have known, since intention is critical in fraud case: a lie is fraud, an honest mistake is not. If you can't prove that she must have been aware that the leak was an ongoing issue, you would not win a fraud case.


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