Nondisclosure not Always Limited to Single Transfer
Question: Under the relocation program of the seller’s employer, the relocation company purchased the home in North Scottsdale when the seller was being transferred to Virginia. The seller did not disclose to the relocation company severe flooding problems in his backyard. Several months later when the relocation company sold the home to us the relocation company did not disclose to us these severe flooding problems. After close of escrow, however, we learned from neighbors that the seller was always complaining about the severe flooding problems. The cost to correct these severe flooding problems will be $24,000. Does the relocation company or the seller have any liability to us for this $24,000 cost?
Answer: The relocation company does not have any liability to you unless the relocation company had knowledge of the severe flooding problems. Although the seller did not sell the home directly to you, the seller should still have liability to you. The reason is that the seller knew that the relocation company would transfer the home to any buyer who would probably not be given notice of the severe flooding problems.