What to do if a defect is discovered in one's real estate property after purchase ?
13 December 2023
What is a hidden defect ?
The concept of hidden defect (or latent defect) applies to all types of sales, whether they involve movable or immovable property, and whether the transaction occurs between individuals or professionals. The Civil Code and legal precedents have defined the conditions under which it can be invoked. The defect must clearly be "hidden," but this does not mean it is limited to flaws known to the seller that they may have attempted to conceal. The mere fact that it was not apparent to the buyer is sufficient, even if the seller was unaware of it.
This defect must render the property "unfit for the purpose for which it is intended, or so diminish this use that the buyer would not have acquired it, or would have given it a lower price," as specified in Article 1641 of the Civil Code. In the case of a real estate sale, this can include any defect that involves costly repairs, which would likely have affected the selling price (such as faulty foundations, termite infestations, or a cracked foundation). The hidden defect must not be attributable to an element external to the property and must evidently exist before the sale.
In what cases must the seller compensate the buyer ?By default, sales are subject to a hidden defect warranty. This implies that the buyer can request a refund of part of the purchase price, necessary repairs, compensation for damages, or even the cancellation of the sale. In real estate matters, a refund is often preferred unless the property cannot be restored.
However, it is possible to waive this rule. A sales contract may contain a hidden defect disclaimer clause. However, it only applies if the seller is acting in good faith and is unaware of any defects. If the seller intentionally conceals a defect, the clause will be void. Therefore, it is important to check if this clause exists and possibly negotiate the purchase price accordingly. Finally, the hidden defect cannot be invoked in the case of a sale "as is." The property is often cheaper in this case because the buyer accepts certain risks.
How long do I have to take action in the case of a hidden defect?Two deadlines apply concerning such defects. The first, lasting two years, starts from the discovery of the defect. The owner may attempt to resolve the issue amicably, seek mediation, consult a justice conciliator, or take the matter to court. Note that this two-year period may be suspended while an expert assessment is carried out.
A second deadline pertains to the expiration of the warranty. It has long been the subject of legal battles, as two rules could theoretically apply. However, the Court of Cassation has ultimately ruled on the matter. In a statement from July 2023, it asserts that the warranty only expires twenty years after the sale. If, during this period, the buyer discovers a defect, they will have two years to take action.
Source : tf1info.fr