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My sister bought a module home in melbourne fl when doing so the inspector
checked off that water in all taps was ok and electric was all ok, In truth the
water wasnt even hooked to the house and the elec. panel is outdated make the
house be not insurable causing the insurance company to drop the insurance. Who
has to fix the panel seller or my sister. house was bought as is
Asked on February 28, 2019 under Real Estate Law, Florida
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 3 years ago | Contributor
Buying a home "as is" does not give the seller a license to commit fraud. The seller is responsible for connecting the water and upgrading the electric panel.
Your sister could sue the seller for fraud and the inspector for negligence.
Fraud is the intentional misrepresentation or nondisclosure 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, your sister would not have purchased the house had she known its true condition.
Damages (monetary compensation) in a lawsuit against the seller for fraud would be either the benefit of the bargain or your sister's out of pocket loss.
Benefit of the bargain means a defrauded purchaser may recover the difference between the real and represented value of the property 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 actual value of the property acquired.
Negligence on the part of the inspector is the failure texercise due care ( that degree of care that a reasonable inspector would have exercised under the same or similar circumstances to prevent foreseeable harm). Damages for negligence are what was foreseeable such as cost of repairs.
One lawsuit would be filed naming the seller and inspector as defendants.
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 3 years ago | Contributor
If you can show that the seller know of these problems--which is likely in regards to the water, but may not the be case for the electric (I know that I, for example, would not know that my home's electric panel were outdated unless an electrician specifically told me that)--but despite knowing of them, did not disclose these issues, then the seller committed fraud. If the seller committed fraud, the seller would be liable for the cost to correct or repair the situation. So the key is being able to show that the seller knew, or under the circumstances logically must have known, of the issues. However, note that even if the seller should be liable, if the seller refuses to pay voluntarily, to get the money from them, you'd have to sue for it, which may or may not be worthwhile.
If the seller did not know of the problem, then in an "as is" sale, they are not liable for it. They are only liable for concealing something of which they are aware.
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