Everyone’s likely heard the phrase “buyer beware”. It’s not just sage advice, but a legal principle. Also known as caveat emptor, the principle of buyer beware remains a force to be reckoned with especially when it comes to buying a home.
Caveat emptor places the responsibility on the purchaser of real estate to satisfy themselves as to the quality of the property they are looking to buy. If something subsequently turns out to be wrong or with the property, it is the purchaser’s problem and they generally cannot look to the seller for compensation.
There are, however, several exceptions to the application of caveat emptor. These are where the seller:
- fraudulently misrepresents or conceals something about the property;
- knows of a latent defect rending the property unfit for habitation;
- is reckless as to the truth or falsity of statements relating to the fitness of the property for habitation; and
- has breached his or her duty to disclose a latent defect that renders the property dangerous.
Two of these exceptions make reference to “latent” defects. A latent defect is one that cannot be discovered by conducting a reasonable inspection of and making reasonable inquiries about the property. A latent defect can be contrasted with a “patent” defect, which is a defect that is capable of being discovered by a reasonable inspection or through reasonable inquiries. If the defect at issue is a patent one, then caveat emptor would typically apply to deny the purchaser the right to claim against the seller. For instance, if you were to buy a house and subsequently discover that a window is broken, that would be a patent defect as it’s one that you could have easily discovered before buying the house. However, even if the defect at issue is one that the average purchaser would not have detected, but is one that a professional home inspector likely would have, the defect can be said to be patent.
As can be seen, getting around caveat emptor can be a very difficult task. For that reason, it is advisable for buyers to make any offers to purchase subject to the property being inspected by a professional.