A seller in Ashland, Oregon completed the Seller's Property Disclosure Statement and indicated that she had no knowledge of any mold issues in the home. After the sale closes, the buyer discovers significant mold behind a bathroom wall. The buyer sues the seller, alleging the seller knew about the mold. The seller insists she had no actual knowledge. Under Oregon's Seller's Property Disclosure Act, which of the following best describes the seller's legal exposure?
Correct Answer
A) The seller has no liability because she completed the disclosure statement in good faith based on her actual knowledge, and the Act limits seller liability to matters of actual knowledge
Oregon's Seller's Property Disclosure Act (ORS 105.462–105.490) bases the seller's disclosure obligation on actual knowledge. The statute requires sellers to disclose conditions they 'know' about. If the seller completed the disclosure statement honestly based on her actual knowledge and genuinely did not know about the mold, she is protected from liability under the Act. The buyer would need to prove the seller had actual knowledge of the concealed defect to establish a violation of the disclosure statute.
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Related Concepts
A stigmatized property is one that has an undesirable reputation due to events that occurred on the property or nearby, such as a murder, suicide, alleged haunting, or proximity to a registered sex offender. The stigma is psychological, not physical.
An as-is clause in a real estate contract states that the buyer accepts the property in its current condition without requiring the seller to make any repairs. However, an as-is sale does NOT eliminate the seller's obligation to disclose known defects.
Asbestos disclosure involves informing buyers about the presence of asbestos-containing materials (ACMs) in a property. Asbestos was commonly used in construction materials before 1980 and poses health risks when fibers become airborne.
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