Accession Law LLC

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Jul 20, 2012

Seller disclosure question

QUESTION:
My elderly mother is selling her vacation home. After full disclosure, is she liable for any period of time for property defects that might arise after closing?
Answer
There is no way to absolutely limit a seller's liability after closing. There is a 6 year statute of limitations for legal claims arising from the purchase contract. Such claims might arise as the result of a warranty or because of representations made by the seller.  For example, there are numerous seller representations made in the real estate condition report which typically is incorporated by reference into the contract.  Remember that misrepresentations can occur both through what is stated and through what is not stated.

Further, Wisconsin has a false advertising statute which may apply to a seller who makes a false or misleading statement to induce a buyer to purchase a home. Under § 100.18(11)(a), if the buyer proves his case, the buyer can recover any monetary loss plus costs and attorney fees.


Even the use of an "as-is" clause does not relieve the seller's duty to fully disclose the condition of the property. For example, in Green Spring Farms v. Spring Green Farms, 172 Wis. 2d 28 (Wis. App. 1992), some calves on the property had been killed by salmonella bacteria. The seller apparently believed that the problem had been alleviated and did not disclose the condition.  Further, the seller sold the property "as-is." The buyer later experienced problems with the salmonella contamination and sued.  The Court held that the seller had a duty to fully disclose material adverse conditions even though the transaction was "as-is." The rationale is that the seller has this material information and the buyer is not able to discover the information.


A seller should discuss any known or suspected property conditions with an attorney to determine what to disclose when and how.


Attorney James N. Graham of Accession Law LLC is providing a general answer which does not establish an attorney/client relationship and which is not legal advice. Contact attorney James N. Graham in order to discuss the terms of retainer and the information needed in order to obtain a legal opinion, recommendation, or advice. The first inquiry for an attorney is to know only the parties involved in order to check for conflicts of interest with current or former clients.


James N. Graham
Accession Law LLC
6401 Odana Road
Madison, WI 53719