luxury home lawsuit

California Home Buyers awarded more than 3 million dollars. California Luxury Home Sellers liable for Breach of Contract, Intentional Misrepresentation, Concealment and Rescission.

Question: If a California home seller received a natural hazard disclosure statement (NHD report) when purchasing their home, and subsequently sells the home using a different, less complete natural hazard disclosure, can the home seller be held liable for failure to disclose? 

 The Tomjanovichs purchased their California luxury home in 2004 for more than 4.25 millions dollars and received a disclosure report detailing water leak issues in the home. However, when they subsequently sold this home in 2007 they made no mention of the original report. The new homebuyers had a subsequent leak, found out the Tomjanovichs had prior knowledge of leaks, and sued the Tomjanovichs for breach of contract, intentional misrepresentation, concealment, and rescission. The jury awarded the new home buyers 2.8 million in compensatory damages and punitive damages of $250,000 (Bardack v. Rudy Tomjaovich, et al., Second Appellate District, August 29, 2014).


Failure to fully disclose with a comprehensive California real estate NHD source is an Attorney’s Dream.


Failure to disclose is an attorney’s dream. In today’s market of underwater mortgages, it is easy to find a plaintiff who purchased a home and is willing to sue a seller and his agent for failure to disclose.  The lawsuit may either make a few dollars, or if suing for rescission, and get out of an underwater home all together. 

The type of ruling in the Tomjanovich case, is not unique and will likely be seen more and more.  For Seller’s who received a complete real estate NHD report when they purchased their home, but purchase a less complete NHD statement when selling their home, the risk of being on the defending side of a lawsuit is very real.

When an agent saves their client a few dollars and buys a cheaper Natural Hazard Disclosure Report, they take the risk that this $10 savings could translate into a six-figure (or more) failure to disclosure damage claim.   The only way to prevent this colossal failure to disclosure facts material to the desirability of a property is to order a complete NHD report that fully indemnifies the agent and their seller. 

And check the fine print: an agent can be certain they have protected themselves and their clients because Property I.D. Corporation doesn’t employ the fine print gimmicks seen on the “limits of liability” pages of many NHD companies.  Property I.D. INC stands behind its report, its agents and their sellers.  After all, Property I.D. Corporation knows that the purchase of a home is likely the most important and expensive investment a California home buyer will make and no expense can be spared ensuring the client’s family and investment are safe.

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