What can be done if my parents bought a house a little over a year ago, when they purchased the house there was no disclosure of a foundation issue and the inspector did not mention it?

Well after a few months they started to get cracks in the ceiling and the tile started to crack. The garage door is not level so it looks as though he garage is sinking, in the last month they found to large cracks on the outside of the house near the garage that were covered up. It is going to cost a lot to get the foundation fixed, do they have a case against the seller or inspector?

Asked on September 28, 2015 under Real Estate Law, Texas

Answers:

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

Answered 5 years ago | Contributor

Your parents would file one lawsuit naming the inspector and the seller as defendants.  
The inspector would be sued for negligence which is the failure to exercise due care that degree of care that a reasonable home inspector would have exercised under the same or similar circumstances to prevent foreseeable harm.
The seller would be sued for fraud.  Fraud is the intentional misrepresentation of a material fact made with knowledge of its falsity and with the intent to induce reliance upon which your parents justifiably relied to their detriment.
In other words, your parents would not have purchased the house had they known of its condition.
Fraud also applies in cases of nondisclosure of a material fact by the seller which the buyer could not have reasonably discovered prior to purchase.
Your parents damages monetary compensation they are seeking in their lawsuit for fraud would be either the benefit of the bargain or their 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 purchased  regardless of the fact that the actual loss suffered might have been less.
Out of pocket determination of damages for fraudulent misrepresentation permits recovery of the difference between the price paid and the actual value of the property acquired.
 


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