This week the experts have been asked by a seller to consider the issue of latent and patent defects in a fixed property.
These two types of defects can often lead to discontent, arguments and even litigation between a purchaser and seller, therefore the reader has asked what he can do to avoid such a situation when selling his house.
The reader explains that the house is in a state of disrepair. He says many areas and fixtures have worn beyond their reasonable lifespan and should have been replaced years ago.
Many of these items are directly visible and others can be seen with some diligent inspection.
The seller is also aware of many aspects that may not be that easily observed. The roof leaks and some of the woodwork around the dwelling is rotten and in need of replacing or substantial repair.
The purchaser can clearly see that the property is not in pristine – or even “fair” – condition but he may not realise the full extent of the repairs required. It would be kind to refer to the property as a “fixer-upper”.
The seller has no problem disclosing what he is aware of in terms of problems and potential problems and has verbally given the purchaser a rundown of these aspects.
His fear, however, is that the purchaser will only fully comprehend the extent of the repairs required after taking occupation. The reader is concerned that the new owner will then attempt to rely on non-disclosure by the seller to try to reduce the purchase price or cancel the sale entirely.
See the reader’s question here.
From a practical perspective, it may be useful for the parties to place on record that the property is in a poor state.
This would be in the agreement of sale, either in the main body or in one of the annexures.
The written record should describe the state of the property in such a way that there is no confusion as to the extent of the defects.
The seller can go so far as to compile a list of the defects in the property. Again, he should be as specific as is reasonably necessary to make a full disclosure to the purchaser.
Where a defect is suspected but the cause is not entirely clear, the problem should be described and perhaps even the suspected cause mentioned.
Where certain aspects have been repaired, people tend to have different standards of what may be regarded as acceptable workmanship.
Many “repairs” by the seller may be regarded as an attempt to merely disguise or hide the actual problem.
In such an instance, the seller is usually aware of the problem as it was he who sought to have it repaired.
He may however neglect to mention the problem as he would be of the opinion that it had been resolved, after it was successfully repaired.
Again, it is prudent to disclose such aspects in the agreement of sale because shoddy repairs could be construed as an attempt to quickly patch a problem for the purpose of hoodwinking the purchaser into the sale.
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