Tuesday, January 29, 2013
A Pennsylvania homeowner is suing the seller of the house and a real estate agent, claiming fraud and misrepresentation, for failing to tell her that the home she recently purchased had been the scene of a murder-suicide the previous year. The homeowner had moved to Pennsylvania from California with her two children after her husband's death. She learned of the murder-suicide from a neighbor, several weeks after moving in. You can read about it here.
I don't know about you, but I think a murder suicide is pretty material, although there aren't enough facts here to indicate whether the seller and agent deliberately concealed the fact or whether the buyer inquired as to any unusual events happening in the house.... With respect to the seller, it might be one of those "tough luck" situations where the law just doesn't help the buyer even if the court feels sympathetic toward the buyer's situation. It's not clear whether the agent is the buyer's agent - if so, the agent should have disclosed this as a fiduciary. But it's more likely that the agent was actually the seller's agent, and not the agent of the buyer or a dual agent. (Got that? Just because someone has the word "agent" in their job title doesn't make that person your agent. Who is paying the commission? When in doubt about where the agent's loyalties lie - ASK the agent).
The lesson here - especially relevant given the recent rise in home sales - is BUYER BEWARE. I wonder if a quick online search of the address would have uncovered the grisly events that took place in it. It would probably be prudent for all potential home buyers to expressly ask, "Did anything unusual ever happen in this house that we should know about such as any crimes?" A buyer should also ask how long the current sellers have lived in the house and why they are moving. [In this case, such a question probably wouldn't have helped the homeowner. The immediate sellers were not the owners of the house when the murder-suicide took place, but subsequent owners who bought it, presumably at a low price given what had just happened in it, and then turned around and sold it to the out-of-state buyer]. The seller's failure to disclose in a situation where the buyer has specifically asked is entirely different from a failure to affirmatively disclose unasked for (albeit material) information.
N.B. Under California real estate law (which imposes a duty to disclose facts materially affecting the value of real property where the facts would be hard to uncover), the result would probably have been different. See Reed v. King, 145 Cal. App. 3d 261 (1983) involving a failure to disclose a multiple murder by a home seller. Interesting, given that the PA home buyer was from California and might have expected a bit more from the seller based upon her real estate experiences there...