A seller in Hilo discloses on the HRS 508D form that the roof was repaired three years ago but does not mention that the repair was done without a building permit. The buyer later discovers the unpermitted work after closing. Under Hawaii law, which statement best describes the seller's disclosure obligation regarding the unpermitted repair?
Correct Answer
B) The seller was required to disclose the unpermitted nature of the repair because it constitutes a material fact affecting the property
Under HRS Chapter 508D, sellers must disclose all material facts known to them that would be expected to affect a buyer's decision. Unpermitted work is a material fact because it can affect the property's value, insurability, and the buyer's ability to sell or refinance in the future. Disclosing that a repair occurred without simultaneously disclosing its unpermitted status is an incomplete and potentially misleading disclosure. The seller's knowledge of the permit deficiency triggers a mandatory disclosure obligation.
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