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Eminent Domain & Real Estate Litigation Blog Condemnation and Real Estate Litigation

Court Rules That Sellers And Brokers May Need To Disclose Prior Condemnation To Buyers

Posted in Eminent Domain

In Shelp v. City of Scranton, a Pennsylvania trial court ruled that, in some cases, property sellers and brokers may be required to disclose the fact that a property was previously condemned to potential buyers. In that case, the defendant sold property to the plaintiff that had been previously condemned. The defendant had acquired the property from the City of Scranton after it was condemned by the City. The defendant did not disclose the prior condemnation to the plaintiff. The City later evicted the plaintiff at which point the plaintiff was informed that the property was condemned.

The plaintiff alleged that seller and real estate broker should have disclosed the prior condemnation. The facts are somewhat unclear, but it appears that the plaintiff was evicted by the City due to the unsafe condition of the property. The seller and the real estate broker filed a motion – known as preliminary objections – alleging that, as a matter of law, there was no duty to disclose the prior condemnation.

The Court denied the motion as to the seller and broker and ruled that the case could proceed. It found, for example, that the plaintiff relied upon the seller and broker’s representation that the property was fit for residential habitation and ultimately it was not fit. The defendants will now have the opportunity, as the case proceeds, to contest the factual arguments so this case is far from over.