What are my rights regarding the seller’s failure to disclose a problem with the wood siding?

I bought my home 3 years ago. The seller did not disclose that the wood siding on the house was a product that there was a class-action lawsuit on against the manufacturer for a failing product. The seller opened a claim with the siding company but did not finish the claim. They replaced some of the siding and painted the house before they sold it. Therefore, the seller was aware of the problem with the siding and did not disclose. I now have major problems with this siding. I contacted the siding company and the last year to file a claim was 11 years ago and a replacement warranty is no longer available. My issue is with the seller not disclosing the problem. What are my rights as a buyer and how might I proceed?

Asked on August 30, 2016 under Real Estate Law, Michigan

Answers:

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

Answered 4 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 of the problem with the siding.
Fraud also applies in cases of nondisclosure of a material fact where the buyer could not have reasonably discovered the true facts prior to purchase.
Your damages (monetary compensation you are seeking 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 may 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 for damages for fraudulent misrepresentation permits the recovery of the difference between the price paid and the actual value of the property acquired.
 


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