Oakland, CA asked in Real Estate Law for California

Q: Newly purchased house found to have broken/fallen foundation. During escrow I paid a foundation contractor for estimate

He missed this huge issue with the foundation. We decided to buy thinking his 10K estimate for bolting and crack repair was all the more needed to spend. Now, we're looking at 30K to 80k for serious repairs (piers for foundation support). Also, there's a leak from the kitchen drain that he didn't mention. We clearly would not have purchased this house, or at least negotiated for a lower price. I found this problem myself, by crawling to a harder to reach area of the craw-space. Also, the seller says that it's been that way. Evidence of shimming efforts are from previous owner. I have no experience with taking someone to court. Can this type of thing be resolved through a negotiated settlement? Do I have any hope here? Or, am I just screwed? FYI, we had no contract with the contractor, just a recommendation from our agent, paid him $375 to look at foundation to tell us in there's any "major" problems.

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2 Lawyer Answers
James Alan Greer
James Alan Greer
Answered
  • Boulder, CO
  • Licensed in California

A: Dear Foundation Issue Client: I'll make an effort to guide you, but the analysis of your potential claims are very much driven by the documentation that you have or don't have as the case may be). As to your Seller: you might have a potential "Failure to Disclose" claim if the Seller is now indicating "that it's been that way" as you mention in your question, and yet the Seller hadn't told you in the disclosure forms what the Seller knew about the foundation. As to prior owner (the "shims") they have no liability as they do not owe you a duty (their duty was to disclose to your Seller, and nothing more). As to the "Foundation Contractor": (A) if there was no writing for the $375.00 service you verbally agreed with the Contractor then that Contractor's potential liability will be limited to what the parties understood was his scope (emails ? texts ? any evidence of expected scope ?), and (B) it would seem a stretch that a foundation contractor would be marshaled with examination of your kitchen plumbing / drain system so I am less confident you would have an actiontionable claim against the Contractor for that kitchen drain problem. Summary: your foundation repair claim might fit into an actionable claim for "Failure to Disclose" but more analytical work by an attorney would be needed. JIM GREER is an attorney licensed to practice in CA and CO and has specialized in real estate matters for the past 30 years; nothing herein shall be construed as the offering of legal advice insofar as Mr. Greer is not in an attorney-client capacity with the inquiring party. 858.481.9006

Maurice Mandel II
Maurice Mandel II
Answered
  • Newport Beach, CA
  • Licensed in California

A: Mr. Greer's answer is so complete there is hardly anything to add to it. If the prior owner that shimmed was your seller, then there is the possibility of a strong failure to disclose case. This is definitely a lesson that "oral side agreements" are a REALLY BAD IDEA when you are buying real property, no matter how congenial everyone seems. Is the leak in the sink caused by the foundation problem?

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