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11. If the investor wins, it will be because
The owner of Blackacre, a residential lot improved with a dwelling, conveyed it for a valuable consideration to an investor. The dwelling had been constructed by a prior owner. The investor had inspected Blackacre prior to the purchase and discovered no defects. After moving in, the investor became aware that sewage seeped into the basement when the toilets were flushed. The owner said that this defect had been present for years and that he had taken no steps to hide the facts from the investor. The investor paid for the necessary repairs and brought an appropriate action against the owner to recover his cost of repair.
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B is incorrect. An inspection will not reveal a latent defect.
C is incorrect. It is the fact that the defect was hidden, not the fact that it poses a health hazard, that is relevant to determining whether the owner failed to fulfill his obligation to disclose.
D is incorrect. An implied warranty of habitability or fitness for particular purpose applies only to new construction being sold by a builder or developer.