Does a seller have an obligation under the law to disclose any known latent or patent defects that the property may have?

Property defects are generally fall into one of the two categories:

Patent defects:

These are easily discoverable by the purchaser or by an inspector hired by him or her.

Latent defects:

These are not known to the purchaser, it is assumed that they are also not known to the seller in most cases as well and cannot be easily revealed, even during a physical inspection being conducted by a professional inspector.

There is no obligation on the seller to disclose the patent defects and the onus is on the buyer. Seller also does not have to disclose latent defects that he or she has no knowledge of. However, if the seller does have the knowledge of a latent defect he or she may have a duty to disclose this information if:

a) If the property is rendered unfit for habitation or is immediately/potentially dangerous because of the defect.

b) Property value will be significantly reduced because of the costs of repairs that the defect will require.

If a seller does not disclose a latent defect to the purchaser, concealing such information can be considered fraud. There are many issues that have been raised regarding the seller’s obligation to disclose certain information that might affect the value or desirability of a property. A property’s value and desirability can be impacted by many tangible and intangible factors. Consult with a real estate lawyer in Mississauga to determine what information needs to be disclosed to a potential buyer.
For example, a property can lose its value and desirability if it was previously used for criminal purposes, a violent crime took place on the property or if a convicted pedophile lives in the neighborhood where the property is located. However, such non-physical and subjective stigmatization does not usually require disclosure unless they render the property dangerous or unfit for habitation.

Similarly, even if a property was used as a drug grow-op in the past there is no obligation on the seller to disclose such information. However, if the property was left in a state that is dangerous or unfit for habitation because of its previous use, in that case there is an obligation on the seller to disclose this information as it would be considered a latent defect. Consult with a real estate lawyer in Mississauga if a property that you purchased might have a defect.