What are my rights regarding an undisclosed water leak in the house that I just bought?
Question Details: Recently bought a home with no inspection. A week after my daughter moved in, she found a mushroom growing on a wall. Further investigation revealed a water leak that had been hidden by the previous owners with silicon on the floor at the base of the trim. This kept the water from flowing out from the pipe in the wall. I opened up the wall to look for the leak and found extensive long term water damage that is costing a substantial amount of money to correct. Is there anything I can do to recover the cost from the previous owners?
You can sue the seller for fraud which is the intentional misrepresentation or nondisclosure of a material fact made with knowledge of its falsity and with the intent to induce your reliance upon which you justifiably relied to your detriment.
In other words, you would not have bought the house had you known of the water leak.
Your damages (monetary compensation you are seeking in your lawsuit for fraud) would be either the benefit of the bargain or your out of pocket loss.
Benefit of the bargain means a defrauded purchaser may recover the difference between the real and represented value of the property regardless of the fact that the actual loss suffered might have been less.
Out of pocket determination of damages for fraudulent misrepresentation permits recovery of the difference between the price paid and actual value of the property acquired.