Should I get my deposit returned when I cancel a sales contract due to nondisclosure?

UPDATED: Oct 1, 2022

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Should I get my deposit returned when I cancel a sales contract due to nondisclosure?

The seller failed to disclose the fact that the home had a recent 17K claim for
water damage and mold remediation. I signed a cancellation document after this
discovery. The seller refuses to cancel the sale and return my deposit.
What are my options? I tried to resolve it with the buyer, but their agent will
not send my letter to them. She says I owe her a commission and payment for her
hourly wages. My agent abandoned us, because she was angry about losing her
commission. I feel we are right in backing out of this sale, due to the seller
lying on the disclosure to cover up this severe water damage claim.
Do I need to get a lawyer to sue them for my monetary damages and deposit?

Asked on January 2, 2019 under Real Estate Law, Florida


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

A failure to disclose an existing or serious past problem can be fraud, and fraud can enable you to void (undo) a contract without any penalty--i.e. while getting your depsot back. A past problem would have to be one that still has some current ramification or impact, such as showing that there is a continuing vulnerability to flooding or unaddressed structural damage--a 100% resolved past problem, however, is no longer "material" or relevant and therefore its nondisclosure would not be fraud. Examples:
The water claim was due to a roof leak: that could show that the roof has a tendency to leak and so would be material and relevant.
But if the water claim was because someone started drawing a bath, got distracted by a phone call and let the tub overflow, that is a nonrepeating event and once resolved is no longer material or relevant.
If the claim was one that could show some continuing issue or concern, etc., then the nondisclosure could well be fraud and you could, if necessary, sue on that basis to void the agreement and get your money back.

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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