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?

UPDATED: Sep 30, 2022

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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


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 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.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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