Seller's Duty to Disclose Lawsuits In California
"In the context of a real estate transaction, 'it is now settled in California that where the seller knows of facts materially affecting the value or desirability of the property . . . and also knows that such facts are not known to, or within the reach of the diligent attention and observation of the buyer, the seller is under a duty to disclose them to the buyer.
Undisclosed facts are material if they would have a significant and measurable effect on market value.
A breach of this duty of disclosure will give rise to a cause of action for both rescission and damages." (Shapiro v. Sutherland, supra, 64 Cal. App. 4th at p. 1544; see also Lingsch v. Savage (1963) 213 Cal. App. 2d 729, 735 29 Cal. Rptr. 201, 8 A.L.R.3d 537.)
The seller or his or her agent must have actual knowledge in order to be liable for failing to disclose a material fact. (See San Diego Hospice v. County of San Diego (1995) 31 Cal. App. 4th 1048, 1055-1056 37 Cal. Rptr. 2d 501.)
Statements concerning the value of property are generally deemed to be expressions of personal opinion and not actionable representations of fact upon which the other party can rely. (1 Miller & Starr, Cal. Real Estate (2d ed. 1989) Contract Law, 1:112, p. 360.)
Conclusions as to how the legal or practical ramifications of disclosed facts adversely impact value are not facts subject to a duty of disclosure. (See Pagano v. Krohn (1997) 60 Cal. App. 4th 1, 7 70 Cal. Rptr. 2d 1; see also Sweat v. Hollister (1995) 37 Cal. App. 4th 603, 609 43 Cal. Rptr. 2d 399.
"The legal ramifications of the factual nature of realty . . . and a conclusion as to how they may adversely impact value, is not a 'fact' subject to required disclosure.", disapproved on another point in Santisas v. Goodin (1998) 17 Cal. 4th 599, 609, fn. 5 71 Cal. Rptr. 2d 830, 951 P.2d 399.)