What Does “Buyer Beware” Mean?
“Buyer beware” is a principle originating from the Latin phrase caveat emptor, which translates to “let the buyer beware.” It implies that the responsibility falls on the buyer to ensure they are making an informed decision and that they fully understand the product or service they are purchasing. The phrase highlights the idea that sellers are not required to point out potential pitfalls or hidden issues with a product. Meaning that a buyer must complete their own searches and inspections when purchasing an item or property.
Are there any Exceptions?
Buyer beware is a very broad legal concept, but one exception exists when buying a house/land, and that exception is for material latent defects. A material latent defect is a hidden flaw that directly relates to the livability/safety of the property. How does one determine if the flaw is hidden? The general test is whether the flaw could be seen through a visual inspection by the potential buyer. If the defect cannot be seen, then the seller has an obligation to alert buyers of material latent defects in a property.
An example of a material latent defect is the property having some sort of radiation leak. A radiation leak is material as it creates a danger to live on property and is latent because it cannot be seen on a normal inspection.
Is there anything I can do to Protect Myself?
The best way to protect oneself is having the item you are buying inspected for potential issues.
Real estate transactions are the most common situation where a person may need to be aware of hidden defects. When buying a property any defects in that property are for the buyer to discover before they buy the property. (Excluding material latent defects)
Therefore, it is prudent to have a home inspection condition inserted into the offer to purchase. This allows the buyer to have the property inspected by a professional before committing to the purchasing it.
Another way a buyer can protect themselves is by asking the seller questions about the property. Buyer beware does not protect the seller from lying to the purchaser. If the buyer asks a question about the property the seller does not have to answer it, but if they do, they cannot lie. For that reasons most real estate transactions have the seller fill out a “Property Disclosure Statement”. The Property Disclosure Statement asks the sellers 19 questions regarding the state of the property.
Some examples are:
- Has the roof ever leaked?
- Does the property contain or used to contain asbestos insulation, lead plumbing, or aluminum wiring?
- Are you aware of any existing defects
An important caveat to asking the seller questions is that if the buyer does not know about an issue they cannot be held responsible for their answer. For that reason, a home inspection is always recommended.
Conclusion
When buying anything it is important to recognize that when purchasing property as a general rule, undiscovered damage to said property is the buyer’s responsibility.
If a reader wishes to discuss this further, please contact our office and one of our lawyers would be happy to be of assistance.
