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13. If the homeowner sues the buyer for breach of contract, is the homeowner likely to prevail?
Before the closing date, the buyer discovered the water damage and the leaking roof. The cost of repair was estimated at $22,000. The buyer has refused to go through with the purchase.
Before putting her home up for sale, a homeowner painted the living room ceiling to conceal major water damage caused by a leaking roof that had not yet been repaired. On the first day the home was offered for sale, the homeowner gave a buyer a personal tour. The homeowner made no statements at all regarding the water damage or the roof. Without discovering the water damage or the leaking roof and without consulting a lawyer, the buyer immediately agreed in writing to buy the home for $200,000.
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A is incorrect. The facts fail to support the conclusion that the buyer did not understand the essential terms of the contract. Moreover, an assenting party's lack of an opportunity to understand the essential terms of a contract will not necessarily invalidate the contract. In addition, a party's failure to use care in reading a writing will not necessarily preclude that party from avoiding a contract induced by fraud.
C is incorrect. An affirmative statement is not required to avoid a contract on the basis of misrepresentation. As explained above, a misrepresentation occurred when the homeowner painted over the water damage, preventing the buyer from learning of the water damage and the leaking roof. Therefore, the buyer's assent was induced by a misrepresentation, and the buyer can avoid the contract.
D is incorrect. A misrepresentation of fact that induces assent provides a basis for avoidance of a contract. As explained above, a misrepresentation occurred when the homeowner painted over the water damage, preventing the buyer from learning of the water damage and the leaking roof. Therefore, the buyer's assent was induced by a misrepresentation, and the buyer can avoid the contract. Moreover, the buyer's not having employed an independent inspector will not prevent the buyer from avoiding the contract based on the homeowner's concealment.