from Local Attorney, Michael H. Wasserman

Wednesday, February 15, 2012

Must a Seller Disclose a Home's Macabre History?

A home being offered for sale was the site of a grizzly murder-suicide. Is the Seller obligated to warn prospective Buyers? A recent decision from Pennsylvania held that (at least in that Commonwealth) the answer is yes.

Back in 2008, we reviewed an Alaska court opinion in which a Buyer's lawsuit against a Seller was dismissed. In that case, the home's former occupant's badly decomposed body was discovered   long after her death. The Sellers said nothing to the Buyer. The Buyer sued the Seller, but the Court turned that claim down.

Working with an equally gruesome set of facts, a Pennsylvania Superior Court has held otherwise, upholding a Buyer's right to sue her Sellers and the real estate agents on both sides of the transaction  for failing to disclose a murder/suicide that took place in the house for sale.  Milliken v. Jacono, 2011 PA Super. 254

The crime in question took place in 2006. Konstantinos Doumboulis, allegedly shot his wife and then himself, leaving (apparently) their three young children with the horrific task of calling the crime in to 911). The Buyer did not learn about the deaths until weeks after she moved in (no doubt from the neighbors who welcomed her into the neighborhood).

Most everyone intending to sell a home in Illinois must make certain disclosures about the condition of the property. There are mandatory disclosure forms for known radon and lead based paint hazards and a separate 23 point Residential Real Property Disclosure Report, by which Sellers must disclose known material defects, covering the physical elements from the roof down to the foundation, histories of flooding or usage of  the property in the production of methamphetamine. None of the mandatory Illinois disclosure forms require any statements regarding occult or macabre events taking place on the premises.

Pennsylvania (like most other states) has a similar "Seller's Disclosure Statement." Significantly however,  Pennsylvania law "allows" Sellers  to make additional disclosures to provide greater specificity or additional disclosures beyond sixteen specifically identified disclosure matters. In other words, Sellers are invited to disclose other or additional any material defects. In fact, the specific form that the Sellers used asked "Are you aware of any material defects to the property, dwelling or fixtures which are not disclosed elsewhere on this form?"

The Court ruled that the 16 mandatory points were not exclusive. That the murder-suicide was a material defect, and should have been disclosed.

Important side-note to real estate agents reading this post - The Sellers apparently asked their agent whether or not they needed to disclose - something along the lines of, “Should we tell the buyers that they’ll be living on the site of a recent murder/suicide?” The agents made inquiry with their Real Estate Commission before telling the Sellers they did not. Asking the board did not let them off the hook for giving the Sellers bad advice.

The take away for Realtors & Sellers? let lawyers make legal determinations  - or risk suffering the consequences.

For Buyers, as I tell my kids every morning before school, you gotta, always, ASK GOOD QUESTIONS. If you want to know about circumstances relating to a home that are not specifically listed in the Illinois Disclosure Forms, the only way a Seller is going to be obligated to tell you is if you ask.