Accurate disclosure of defects in a property is a crucial part of any real estate transaction. Sellers are legally required to disclose any material defects known to them. However, the situation becomes complicated when a seller is unaware of a hidden defect. Let's look at a case study.

1. The Plumbing Defect Question

Let's imagine that a seller is questioned about the existence of known defects in the plumbing of his property. In response, the seller declares that, to the best of her knowledge and belief, there are no plumbing defects. However, what she doesn't know is that the pipes are corroded and require replacement.

2. Breach of Disclosure Obligations?

In this situation, the key question is whether the seller is breaching its disclosure responsibilities. The answer is no. Since the seller has no knowledge of the plumbing problem, she cannot be held responsible for not disclosing the material defect.

3. After-sales Responsibility

Importantly, once the sale is completed, any issues that arise are not the responsibility of the seller and do not constitute a legal basis for the buyer to file a lawsuit. However, determining exactly when a problem started and when the seller “knew” it is not always clear.

In this particular case, the seller was not aware of the plumbing problem, which means she is not responsible for not disclosing the material defect. Real estate law tends to favor full and accurate disclosure, but also takes into account a lack of genuine knowledge on the part of the seller.

In summary, in real estate transactions, accurate disclosure is essential, but the seller's lack of genuine knowledge of a defect may exempt the seller from liability for failing to disclose the defect.