It is true that sellers are supposed to disclose certain information to buyers during the process of selling a commercial property. This is especially true for material facts that are going to have a financial impact.
For example, perhaps repairs are needed on the property. They could cost tens of thousands of dollars – or even millions of dollars, in some cases. This clearly is going to impact how much the property is worth and what the buyer is willing to pay. Therefore, the seller needs to either make the fixes themselves or at least disclose the necessary repairs so that the buyer can factor that in.
If they fail to do this, it is known as the non-disclosure of material facts. It can be seen as a type of fraud. A seller who does this on purpose is likely just trying to get more money for a property than it is actually worth.
What if they claim they didn’t know?
When these cases get to be the most complicated is when the seller claims that they were unaware of the defects or issues that were not reported. Say that there’s a leak in the roof and the entire roof is going to need to be replaced. It’s a massive project, but the seller may say that they didn’t know about the leak and never saw any evidence of it.
This is complex because you and your legal team may need to show that the seller did, in fact, know about the defects in advance. They knew about the need for repairs. They either tried to cover it up or they simply neglected to tell you and hoped that it wouldn’t be found.
But there are also authentic cases where a seller will say that they didn’t know about problems with the property. It may be that these issues were hidden or genuinely missed. So it’s important to be able to sort one type of case from the other when determining exactly what obligations that seller has. If you find yourself in a disputed transaction, be sure you understand your legal options.
Subscribe To This Blog’s Feed