Your Rights as a Virginia Homeowner Against a Seller Who Failed to Disclose a Defect
If you weren't told of an existing defect in the house you bought, the burden should not fall on your shoulders alone.
Let’s say you recently moved into a new home in Virginia that seemed just right -- the right size, the right location, and the right price. Things were great for about a month, until you notice a strange smell coming from the walls. Then you notice places in the wall that have become rather soft. You decide you’d better call in a professional to take a look (good choice!). The contractor tells you that the plumbing is old, defective, and has leaked for years, and that most of the home needs to be re-plumbed.
You call the sellers, who claim they had no idea about any plumbing problems. Yet the contractor finds evidence of recent repairs. What do you do now?
Your Duty to Stop Further Damage
Before you think about who is responsible for the problems, make whatever repairs are necessary to prevent further damage. You can’t just sit back and wait for things to get worse. You are responsible for any damage occurring after you discovered the problem.
Be sure to keep accurate records of the repair expenses, however, as you will need these in any claim for reimbursement.
Review Your Homeowner’s Insurance
A straightforward solution to the problem is to check whether the problem is covered by your homeowner’s insurance policy or a home warranty if you have one. Whether your issue with the home is covered or not depends on what the problem is, and the terms of the insurance or warranty.
In the case of the faulty plumbing, although it is unlikely you’d be entitled to the cost of new plumbing (because it would probably be excluded from warranty coverage as a pre-existing condition, and excluded as a construction defect under homeowner’s insurance), you might be entitled to receive the cost to fix the damage the leaky pipes caused.
Be sure to notify the warranty provider or your insurance agent as soon as you find the problem. For advice on how to work with your insurance company, see Nolo’s article, “After the Fire: Dealing with Your Insurance Company.”
Virginia Seller Disclosure Requirements
If you have a problem that is covered fully by your insurance policy or home warranty, this might be the end of your concerns. If not, you will likely wonder whether you can hold the seller responsible for the failure to inform you of the problem with the home.
In many states, the law requires a home seller to disclose to a potential buyer any problems or defects known about the home. In Virginia, however, the seller is obligated only to provide the buyer with a “Residential Property Disclosure Statement,” (Code of Virginia § 55-519), which contains minimal information.
The first item on this disclosure form states that the seller “makes no representations or warranties about the condition of the property or its attachments.” Essentially this means the seller is not responsible for informing the buyer about anything wrong with the property, and it is up to the buyer to find any problems prior to closing. (For more information on what a seller must disclose in Virginia see Nolo’s article: “Virginia Home Buyers: What Does the Seller’s Disclosure Form Tell You?”.)
Seller’s Liability for Misrepresentation
Due to the limited disclosures required of home sellers in Virginia, it is unlikely that a court would find the seller liable for any failure to disclose a problem with the home prior to the sale (except in the rare case where the seller actually included specific warranties or disclosures in the contract).
However, depending on your earlier communications with the seller, you might have a valid claim for misrepresentation. A seller who knows about a problem cannot take active steps to cover it up. Neither can the seller lie about something when asked.
In the leaky pipe scenario, you might have a claim against the seller if, prior to the purchase, the seller made any statements to you about the great condition of the plumbing, or denied having any trouble with leaks or plumbing issues when directly asked.
Challenges in Suing for Misrepresentation
Undertaking a lawsuit for misrepresentation tends to be difficult and expensive. You must have strong evidence of the seller’s knowledge of the defect and evidence of the seller’s outright lying. The seller will most likely have a convenient memory lapse and deny having had any discussion with you about the plumbing. Unfortunately, unless you got the information in writing or carried a recording device during your conversations, you may have difficulty getting the evidence you need to succeed in a lawsuit.
Although a legal claim against the seller may be possible, the expense, hassle, and time involved may not be worth it — unless the cost to repair the problem is high enough. Despite your possibly having a strong case, however, collecting any damages the court awards you could be a challenge. The seller may simply not have such a large sum on hand, and you may have to take multiple follow-up steps.
Even if court is not where you want to end up, it’s still a good idea to send (or have an attorney send) a notification to the seller explaining the problem and the reasons you believe the seller is liable for misrepresentation. Attach a written estimate from a professional contractor setting forth the cost of repairs. Request reimbursement from the seller for these costs. Depending on the strength of your case, you might have luck getting the seller to pay the repair costs, or a portion of those costs, in exchange for dropping your claim.
Remedies If Your Pre-Purchase Home Inspection Found No Defects
As you can see, it can be difficult to hold the seller responsible for problems with the home after closing. Your best bet as a homebuyer is to find any problems with the home before actually closing on the purchase, most likely by hiring a professional home inspector.
But what if you had a home inspection done and it didn’t turn up the problem? In certain circumstances, a claim can be made against the home inspector for failure to detect a defect in the home. However these types of claims are rarely successful. A home inspector’s obligations are narrow, and inspection reports typically contain a variety of limitations on liability and detailed descriptions limiting the scope of the inspection.
As a Virginia home buyer, you are generally assuming responsibility for any problems you find with the condition of the home later on. Except in the uncommon case where you have strong evidence of blatant lying on the part of the seller about a defect in the home, it will be a challenge to hold the seller accountable for any issues with the home. Speak with an experienced real estate attorney for a full analysis of the circumstances surrounding your purchase.