A Virginia seller, Patricia, sold her home using a disclaimer statement under the Virginia Residential Property Disclosure Act. After closing, the buyer discovered significant structural damage that Patricia knew about but did not disclose. The buyer wants to sue Patricia for breach of contract and fraud. Which of the following most accurately describes the legal effect of the disclaimer statement in this situation?
Correct Answer
B) The disclaimer statement shifts the buyer's inspection responsibility but does not protect Patricia from liability for active fraud or knowing concealment.
Under the Virginia Residential Property Disclosure Act (Va. Code § 55.1-700 et seq.), a seller may choose to provide a disclaimer statement rather than a full disclosure, which shifts the responsibility of discovering property defects to the buyer. However, the disclaimer does NOT immunize the seller from liability for active fraud, intentional misrepresentation, or the knowing concealment of material defects. Patricia's knowing concealment of structural damage could still expose her to fraud claims despite the disclaimer.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.
Liquidated damages are a predetermined amount of money specified in the contract that the non-breaching party is entitled to receive if the other party breaches. In real estate, the earnest money deposit typically serves as liquidated damages.
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
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