The Seller Hid Defects: Suing for Nondisclosure After a Florida Home Closing

The first heavy rain after closing, water comes through the ceiling of the back bedroom. The roofer who comes out finds patches on patches and says the leak is years old. A neighbor mentions that the previous owner had buckets out every summer. In the garage you find a half-used can of stain-blocking paint. And the seller's disclosure form you were handed before closing has a box marked "no" beside the question about roof leaks.

Florida does not leave home buyers to the old rule of buyer beware. For decades the state has required sellers of homes to disclose what they know, and it gives buyers a claim when they do not. The claim has specific elements and specific limits, and how the buyer handles the first few weeks after the discovery has a great deal to do with how it turns out.

What does a Florida home seller have to disclose?

The rule comes from the Florida Supreme Court: a seller of a home who knows of facts materially affecting the value of the property, which are not readily observable and are not known to the buyer, has a duty to disclose them. The duty applies whether or not the buyer asks. The law does not require a particular form, but the standard seller's disclosure used in most transactions is how the duty is usually met, and a false answer on it is strong evidence. The defects that produce these cases are familiar: roof leaks, plumbing and electrical problems, foundation movement, sinkhole activity, water intrusion and mold, termite damage, work done without permits, and past insurance claims. A separate statute now requires a written flood disclosure in residential sales. Real estate licensees have their own duty to disclose material defects they know about.

Does an "as is" contract protect the seller?

Not from concealment. "As is" means the seller will make no repairs and the buyer accepts the property in its visible condition. Florida courts have held repeatedly that it does not cancel the duty to disclose known hidden defects. The same is true of general disclaimers and of clauses stating that the buyer relied on an independent inspection. A seller cannot use contract language to excuse a fraud, however the clause is worded.

What does the buyer have to prove?

That the seller knew of the defect; that it materially affects the property's value; that it was not readily observable and was not known to the buyer; that the seller did not disclose it; and that the buyer was damaged. Knowledge is where these cases are fought. The duty covers what the seller actually knew, not what a careful owner should have known. The proof comes from repair invoices, insurance claims, permit and code enforcement files, inspection reports from earlier deals that fell through, old listing descriptions, contractors, and neighbors. Signs of cosmetic cover-up count as well: fresh paint over a stained ceiling, new flooring over one damaged area, furniture arranged to hide a crack.

What if your inspector missed it?

The seller will argue that the defect was observable and that you, or your inspector, should have found it. An inspection does not relieve a seller of the duty to disclose. It does matter if the problem was obvious, or was noted in the report you received, because a buyer cannot claim to have been deceived about something the buyer knew. Courts ask what a reasonably diligent buyer would have discovered. Defects behind walls, under flooring, above ceilings, or apparent only in certain weather are generally not observable in that sense. Claims against inspectors themselves are narrow, since most inspection agreements limit liability to the fee paid. Keep the report: it records what could be seen on the day of the inspection.

Do the same rules apply to commercial property and new construction?

No. The disclosure duty does not extend to sales of commercial real estate, where buyer beware remains the rule, although affirmative misrepresentations and active concealment are still fraud in any transaction. New homes bought from a builder follow a different track: warranties implied by law, statutory warranties for condominiums, and a notice and repair process that must be completed before a construction defect lawsuit. Sellers who never occupied the property, such as banks and estates, may have little actual knowledge to disclose, which makes those claims harder.

What can a buyer recover?

Money damages, measured in most cases by the cost of repair or by the difference between the price paid and what the property was worth in its true condition. Related losses, such as temporary housing or damaged belongings, may be recoverable where they are proven. In serious cases a court can rescind the sale, returning the price to the buyer and the property to the seller, though that remedy requires prompt action. Punitive damages are possible in fraud cases with the court's permission. Most Florida residential contracts award attorney's fees to the prevailing party and require mediation first, and those terms often reach claims arising from the sale. A listing agent who knew of the defect can be a defendant as well.

How long do you have, and what should you do first?

Florida generally allows four years to sue for fraud, counted from when the facts were discovered or should have been discovered with reasonable diligence, with an outer limit that applies regardless of discovery. Waiting helps nobody, because the evidence is at its strongest now. Photograph and video the conditions before repairing them, and keep the materials that are removed. Get written opinions from licensed contractors about the cause and the age of the problem. Collect the disclosure form, the listing, the inspection report, and the contract. Request the property's permit and code enforcement history from the local government. Make the repairs needed to stop further damage, and save the invoices. Then send written notice to the seller through a lawyer, not through a text message.

Salomon Smith PLLC represents Florida home buyers in nondisclosure and real estate fraud claims against sellers and others involved in the sale. If you found defects after closing that someone knew about before it, call (305) 297-1018 for a free consultation, or learn more about our real estate fraud practice.

This article is for general informational purposes only and is not legal advice.