A new Court of Appeals case in Washington has continued the trend of “Buyer Beware” when it comes to the purchase of residential real estate in Washington.
Attached is a link to the case Douglas v. Visser, 295 P.3d 800 (2013) so that you can read the facts of this case to better understand the context and the surprising court ruling.
What it boils down to is the seller ran out of money while to trying to “flip” a house. Therefore, he told his contractors to cover up defects with the house such as rotted floor joists. Instead of properly repairing the rotten sub floor, the seller covered it up to “look nice.”
An interesting side note fact is the seller is a real estate broker in Washington.
When it came time to list the house for sale, the Sellers then either did accurately answer the questions on the Form 17 Real Estate Disclosure Statement or did not answer the question or marked “Don’t Know.”
You know the rest of the story: Buyer purchased it. Found the flooring defect after closing. Sued the Seller. Buyer won at trial court and then in a stunning reversal, the Washington State Court of Appeals Division I reversed the trial court and ruled in favor of the Seller.
The Court of Appeals held that a buyer has a common law duty to perform their own investigation when they have any indication that they suspect there may be a problem with a house. If the buyer suspects there may be a problem, such as a seller’s failure to answer a question on the Form 17, then the burden and duty shifts to the buyer to check it out to their own satisfaction prior to actually purchasing the property.
You should read the case and the court rulings cited within the case to better understand how we got to where we are now.
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