Failure To Disclose

Failure To Disclose

Seller’s Duty to disclose under Johnson v. Davis, Broker Liability, Buyers duties to investigate under Gilchrist Timber Co. v. ITT Rayonier, lnc.

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Failure To Disclose

Bernhardt Riley

Failure To Disclose

Seller’s Duty to disclose under Johnson v. Davis

During the sale of a property, a seller’s failure to disclose any latent issues of which the seller was aware may result in serious legal consequences. However, sellers of Florida homes or properties are not held responsible for defects of which they have no actual knowledge. The Florida Supreme Court case of Johnson v. Davis, 480 So. 2d 625 (Fla. 1985) imposed disclosure requirements on a seller of real property by holding that when a seller of a home knows of facts materially affecting the value of the property, which are not readily observable and are not known to the buyer, the seller is under a duty to disclose them.  This duty is equally applicable to all forms of real property, new and used.

Although sellers in Florida are bound by the law to disclose known defects, they often neglect to do so. If you feel that the seller of your home violated the duty to disclose known defects, the real estate attorneys at Bernhardt Riley may be able to take legal action for you.

Broker Liability

The duty of disclosure announced in Johnson v. Davis extends to a seller’s real estate broker. In Goodman v. Rose Realty West, Inc., 193 So. 3d 86 (Fla. 4th DCA 2016), a purchaser of real property brought an action for fraudulent nondisclosure against the seller and the seller’s agent and broker. The court held that a broker could be liable to a purchaser for any fraudulent nondisclosure by the seller under a theory of agency law. Thus, the broker was a principal of the real estate agent and was therefore civilly liable for the tortious acts of its agent that were within the scope of the agent’s employment. This is true even where the agent’s acts or representations are found to be fraudulent or deceitful.

Whether you are a purchaser, agent or broker, you want an experienced real estate attorney, who is also a licensed Realtor, on your side. Contact the real estate attorneys at Bernhardt Riley.

Buyers duties to investigate under Gilchrist Timber Co. v. ITT Rayonier, lnc.

The 1997 case of Gilchrist Timber Co. v. ITT Rayonier, lnc., 696 So. 2d 334 (Fla. 1997) determined the scope of a buyer’s duty to investigate any defects during the purchase of a property. The Florida Supreme Court in Gilchrist determined that the buyer does “not have to investigate every piece of information furnished;” rather, the buyer must only investigate “information that a reasonable person in the position of the [buyer] would be expected to investigate.” Id. at 339.

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