Do we have a case to sue previous owners

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Do we have a case to sue previous owners

We recently purchased a home within the Inspection Objection the seller stated
that the Furnace had been serviced in the last 15 months and that they would
provide an invoice of that fact. We never received an invoice and since the close
we have had two HVAC companies come out to inspect the Furnace. Both have
stated that the air conditioning unit has been leaking into the furnace for about
two years now and that the furnace can not be turned on due to safety issues and
it is a dangerous situation. One actually even turned off the emergency shut off
valve just in case we accidentally turned the heat on due to carbon monoxide. We
want to know if legally we can sue the previous sellers to pay for the furnace and
mis representation in a legal binding contract?

Asked on August 8, 2016 under Real Estate Law, Colorado

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 the condition of the furnace.
Fraud is also applicable in cases of nondisclosure by the seller of a material fact which the buyer could not have reasonably discovered prior to purchase.
Your damages (monetary compensation for fraud) would be either benefit of the bargain or out of pocket loss.
Benefit of the bargain allows a defrauded purchaser to 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 recovery of the difference between the price paid and actual value of the property acquired.


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