Seller has duty to disclose important problems in home

Q: When we bought our home, the sellers’ disclosure statement said there were no defects. After we moved in and took down some drywall, we found big cracks in the basement foundation and major dry rot. Our buyer’s agent called the seller’s agent, who apparently gave us the wrong disclosure. An old one in the file mentioned the cracks, but we never got that information. Should the listing agent pay for repairs?

A: When we usually get disclosure questions, there is lots of smoke but no smoking gun. It seems you just found one.

Most states have seller disclosure laws that require the seller to deliver a statement to the buyer listing all known defects in the home. There are times when sellers are legitimately unaware of issues and thus don’t report them. But your situation seems quite different, given that the seller put up walls in the basement — perhaps intentionally concealing the foundation.

Because the cracks are serious, costly and material, they should have been disclosed to you.

We don’t think you’ll get far suing the listing agent, who would generally have no idea whether a problem got fixed while clients lived in the home. You’re actually lucky that the agent found the old disclosure. We think it’s the seller whom you should focus on.

But this is key: Some states’ disclosure laws require you to take action within a specified time, perhaps one or two years from closing. If you are within this window, you may be able to sue for repair costs. If you’re outside the window, you’re out of luck. ( But if your attorney thinks the situation qualifies as fraud, the statute of limitations would not apply.)

Consult with an attorney specializing in seller- disclosure actions, and good luck.