Q: We are renting a single-family home that we thought we might want to buy. When we signed the lease two years ago, we paid the landlord several thousand dollars for an option to purchase the home at a commercially reasonable price. Last month, the landlord put the home on the market, and we jumped at the chance to buy it. But now we’ve learned, through the disclosures, that it has significant structural damage that wasn’t evident all the while we lived here. We’re not going to buy it, but we want to know — can we get that option-fee back? Had we known then what we know now, we wouldn’t have paid for the option. –Tom and Mary Z.
A: Residential property sellers and their brokers are subject to numerous inspection and disclosure obligations regarding the physical condition of the property, about everything from the presence of lead paint or asbestos to "natural hazards" of the area (such as being in a special flood zone), the age of the roof, and even the quality of the home’s insulation.
In some states, sellers must even disclose known nonphysical problems that have proven important to buyers, such as whether anyone has died on the property. These disclosures can make or break a sale, and failure to disclose something important can undo the deal or make the seller liable to the buyer for damages.
What’s not so clear, however, is whether the duty to disclose is triggered when a landlord-owner signs a lease giving the tenant an option to buy. In some states, like California, the answer is yes. In these states, a landlord who signs a lease with an option to buy is in the same position as any other seller.
And in these states, the landlord’s failure to disclose something as significant as major structural damage should mean that you get your option-fee back. You’ll need to check with your state’s department of real estate to find out whether your state treats options this way.
Q: I’ve been renovating my single-family rental and doing the work myself. Naturally, I have construction materials and debris on the property, including a pile of lumber pieces that I’ll eventually cart off to the dump. Yesterday, my neighbor came by to tell me that his 7-year-old son was playing with the wood and fell onto a piece that had a protruding nail, which punctured his leg. The little fellow endured a painful visit in the emergency room and may need further treatment. My neighbor says I’m responsible and should pay for the visit. Can this be so? Wasn’t the parent responsible for failing to monitor his child? –Dale S.
A: Property owners have a duty to maintain their property in reasonably safe condition so that their guests and business invitees aren’t injured. For example, landlords must fix broken steps, cracked windows and anything else that poses an unreasonable risk of harm, particularly if the risk isn’t evident. If the landlord fails to keep things safe and a tenant or tenant’s guest is injured as a result, the landlord can be held liable. …CONTINUED
Interestingly, in some states even a trespasser can sue the landlord. For example, someone who came to the front door by mistake, thinking it was a different address, could sue for injuries caused by your broken handrail. Criminal trespassers, however, would have a harder time!
Technically speaking, your neighbor’s son was a trespasser because he was on the property without a legitimate social or business reason. But he may have a legal claim against you on the basis of another legal theory, known as "attractive nuisance." For a long time, courts have imposed an additional duty on landowners with respect to children.
If the owners allow a dangerous situation to develop on their property that is accessible and attractive to a child, and a child is injured when investigating or playing with it, the owner may be found liable. The idea behind this is that children have limited abilities to size up danger, and society as a whole owes it to every child to minimize the opportunities for children to be injured.
The classic example of an attractive nuisance is an abandoned refrigerator with its door intact or an unfenced swimming pool. Many states and cities have recognized the most common attractive nuisances and have written ordinances that prohibit landowners from allowing them to develop.
The issue for you is whether your pile of lumber, which was apparently unfenced, constituted an irresistible attraction to a 7-year-old child. I suspect that most judges would say that it did — the prospect of making something or otherwise fooling around undoubtedly captured your little neighbor’s fancy. And although you are right that parents have a duty to monitor their children, no one is going to expect a parent to shadow a 7-year-old’s every movement once he leaves the house.
But it’s unlikely that this incident will even get to court. Get in touch with your homeowner’s insurance agent right away and explain what happened. The liability portion of your policy is designed to cover events like this, in which your arguable carelessness (allowing the lumber to sit there, accessible to all) resulted in someone’s injury. If your neighbor wants to be compensated for his medical costs, he should file a claim against your carrier, who will undoubtedly negotiate a settlement.
Janet Portman is an attorney and managing editor at Nolo. She specializes in landlord/tenant law and is co-author of "Every Landlord’s Legal Guide" and "Every Tenant’s Legal Guide." She can be reached at janet@sandbox.inman.com.
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