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Handling Failure to Disclose Disputes: An Interview with Dominic Silvestri, Attorney at Law

By Dominic Silvestri

Tell us a little bit about your firm and the areas of law that you practice.

My firm handles all aspects of real estate law, contract law and business law matters, including litigation of these areas.

What's the first thing that a new homeowner should know about possible litigation for a failure to disclose dispute?

Under the Michigan Seller's Disclosure Act, a seller of residential property must provide the buyer with a Seller's Disclosure Statement. The seller must disclose the condition of all major appliances, systems, and services of the property. The seller must also disclose the general condition of the property, including basement and roof leaks, insect infestation, and underground storage tanks; any outstanding assessments; pending litigation; and the duration of the seller's occupancy.

Under this Act, failure of a Seller to provide this Statement grants a right of rescission to the purchaser - meaning, the purchaser can walk away from the deal. This is the purchaser's sole remedy. No recouped expenses, no lawsuit for massive damages- just termination of the purchase agreement. Keep in mind that, under the Act, the rescission right ends at closing.

Although the Act specifically states that the seller shall supply such a Statement, no consequences are provided under the Act AFTER the parties close. However, a new home buyer, who may later discover that the Seller failed to disclose, may have the traditional Michigan legal remedy of fraud or misrepresentation.

Therefore, it's very important for a potential new homeowner to carefully review the disclosure statement and conduct their home inspection. Keep in mind that a Seller is only required to disclose information known to them at the time Statement is completed.

What are the most common failures to disclose that you've seen arise with homeowners?

Mainly water based issues, such as roof or basement leaks and/or mold. These tend to be big ticket repairs.

Can you briefly describe the basic rights that homeowners have when it comes to disputes with a seller?

If a dispute arises before closing, the potential buyer has the right to terminate the contract and walk away. If the dispute arises after closing, the Act does not provide much guidance and traditional Michigan law governs. This requires a close examination of facts as to whether the Seller committed fraud or misrepresentation. Proving fraud is not as easy as saying "my seller failed to disclose something- therefore he owes me money for the repair."

When should a homeowner who is having problems with their newly purchased home consult a lawyer?

I recommend my clients contact an attorney as soon as any issue is discovered to determine what their rights are. At the same time, I recommend my clients contact the Seller immediately once they determine their rights.

Do you have any advice to help people settle failure to disclose issues as quickly as possible?

I believe open and prompt communication is crucial to resolving issues as quickly as possible.

What's the best way for people to contact you and your firm?

Office: 248-246-6323
Email: dominic@dslawpllc.com
Web: www.dslawpllc.com

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