Am I entitled to compensation for my builder’s failure to disclose that a roadway was going to be built right next to my house?

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Am I entitled to compensation for my builder’s failure to disclose that a roadway was going to be built right next to my house?

I relocated 4 months ago. After purchasing a new home from the builder in a planned community, I read an article in the local newspaper about construction beginning in the fall on a roadway that will be limited to pedestrians, bicycles, and low-voltage vehicles golf carts. It will pass 130 feet from my back yard. It will be built on top of an existing berm that is 7 feet high, the same height as the wall separating my back yard from the roadway, effectively eliminating the walls ability to provide privacy and security. The wall is already at the maximum height permitted by city building code. The builder did not make any mention of the roadway and its potential impact on the property and denied having knowledge of it when I asked them. Upon further investigation, I learned the roadway was proposed 3 years ago and went through several iterations before the city approved the final design in April of this year. During that time, the roadway received a lot of publicity for being a polarizing topic among the city’s residents. I believe the salespeople and/or those higher up in the company knew about the roadway but chose to not disclose it for fear it would make the property difficult to sell at the price they expected. Should the builder have known about the roadways proximity to my property and have included it with the rest of the disclosures?

Asked on September 30, 2016 under Real Estate Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

Yes, you may be able to sue based on fraud: fraud is the intentional or knowing mispresentation--which can often be by omission, or not saying anything about an important issue when a person should disclose the issue--made to induce, or cause, you to do something, like buying a house, and on which it was reasonable for you rely. A roadway being built at the height of your wall--even one for limited purposes, like the one describe--certainly has the ability to affect property value or your decision to buy in the first place. Therefore, since this information was material and the builder certainly knew of it, his failure to disclose may have been fraud, and may entitle you to monetary compensation.


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