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Non-Disclosure Real Estate Litigation In Los Angeles

 

If a property is sold with a known defect that is deliberately not disclosed to the buyer during sale, the buyer may have a legitimate non-disclosure recovery claim.

What is non-disclosure?

Non-disclosure involves a situation where the seller of real estate—both commercial and residential— fails to disclose the true condition of the property.  The non-disclosure can take many different forms, including intentional misrepresentation, negligent misrepresentation, concealment, constructive fraud, beach of contract and breach of fiduciary duty.  The sellers, their agents, and their brokers all have disclosure duties to a buyer of real estate in California.   Many cases involves various theories of liability based on the evidence the buyer may have regarding the non-disclosure and which parties to the transaction contributed to the non-disclosure.  Many of our cases involve a buyer seeking liability against the seller, their agent and their broker.

What if you discover a defect in the property you just purchased?

If a buyer discovers a defect in the property and the buyer thinks that the seller knew about a defect – such as a basement that floods in heavy rain or the property does not contain a proper retaining wall – and the seller fails to disclose it, the buyer may be entitled to damages for the seller’s failure to disclose.

Keep in mind, however, that as long as the defect is disclosed there is often no liability for the defect. On the other hand, if the disclosure did not happen until late in escrow, the buyer may have the right to get out of the deal or to collect damages.

Is there a statute of limitations for non-disclosure matters?

Nearly all civil claims involve statutes of limitations.  The statute of limitations is the time within which a plaintiff must bring their claim.   The length of the statute of limitations varies depending on the claim and who the defendant is.  Generally, the applicable statute of limitations is 2-4 years.  That said, we recommend taking immediate action to avoid a statute of limitations defense in its entirety.

What kind of damages can you get in a non-disclosure matter?

The measure of damages in a non-disclosure matter is the difference between the price the buyer paid and the actual true fair market value of the property had the seller/agent made a full and accurate disclosure.  In other words, what would a knowing buyer have paid versus what the buyer actually paid.  The most common way that we determine these types of damages is through a retrospective or retroactive appraisal where a trained appraiser determines the actual fair market value of the property, back in time, had seller/agents made a full disclosure.   There are also alternative ways to measure damages that can involve the cost to repair or fix the non-disclosed item.

Representative Matters

The attorneys at Schorr Law have extensive experience with real estate related non-disclosure claims.   Those claims can be based in fraud, breach of contract (based on the purchase and sale agreement), and negligent misrepresentation.  The following is a list of just a few of the non-disclosure cases Schorr Law has assisted its clients in:

  • Schorr Law successfully defeated an arbitration claim in Los Angeles County by a plaintiff who alleged Schorr Law’s client failed to discuss a report concerning the stability of a cliff above the property the defendants sold to plaintiff.   The arbitrator found a lack of reasonable reliance by plaintiff.
  • Schorr Law obtained a large settlement on behalf of its client in a dual agency situation where the seller and the dual agent failed to disclose impermissible rentals, unpermitted conditions and various defects on a multi-million dollar transaction located in San Luis Obispo County, California.
  • Schorr law obtained a large settlement on behalf of a buyer who purchased in multi-unit apartment building in Los Angeles where the seller failed to disclose that it had created an additional unit at the premises without the necessary permits.
  • Schorr Law obtained a settlement on behalf of tis client in Los Angeles County in a non-disclosure case involving undisclosed termite damage.
  • Schorr Law successfully prevented a claim by a buyer who claimed Schorr Law’s client had failed to disclose an armed robbery in the property at issue
  • Schorr Law successfully prevented a claim by a buyer who claimed Schorr Law’s client had failed to disclose noise problems in the neighborhood prior to the buyer’s purchase.
  • Schorr Law resolved a multi-party multi-million dollar non-disclosure matter involving both a commercial leasing dispute and the sale of a commercial property for less than 10% of the demand.
  • In a non-disclosure type matter, Schorr Law obtained an unanimous jury verdict in Schorr Law’s client’s favor in a case involving non-disclosure of alleged defects in connection with the sale of an airplane.

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