Expert: liznarr - 4/29/2009

Question
Last June, my boyfriend and I closed on our house in Des Moines, IA. It was a long search process and to finally have found the one, we were very excited. One week after we moved in, we got water in our finished basement. The disclosure statement said there weren't any know instances of water in the basement. After speaking with our neighbors, we found out that there was an instance where "the electricity had went out causing the sump pump to stop." Everything from the drywall in the basement was pulled out and replaced. The owner of the property had purchased it from a couple and was fixing it up. Since he wasn't living in the house ad the time, the sump pump being off caused the water to get in the basement (all this according to our neighbors). We left it at that and hoped that it would happen. Well, the rest of the summer our basement was dry. And with all of the rain and flooding that Iowa had seen last year, we were almost certain that must have been the cause to our first flooding incident.
Now it's spring and almost a year since we purchased our home. After very heavy rains  this past weekend, the water is back in our re-finished (since the first water) basement. after pulling up the carpet in both rooms for a second time and moving all of the boxes and items out of our storage room, we found a used can of hydraulic cement. Another thing that points us to believe that someone new about the water damage and occurrences in our basement.

Is there anything we can do if the information was falsified on the disclosure statement?

Answer
Hi Jenifer,

What you described is FRAUD, which is defined as INTENTIONAL misrepresentation.  I am so sorry to hear of your problem, and this is the kind of thing that no one should have to put up with.  

The answer is, “Yes, if you can prove that the information on the disclosure statement was falsified, you most certainly have recourse.”

If I were you, I would document as much as you can.  Some things you need to do as quickly as possible are:  

1.   Get a signed, notarized statement from the neighbor (while he/she is in a cooperative mood) detailing the facts of all that you were told, being mindful that people can change their mind later.  I would do this ASAP and get dates as this could be very important for you later if you file suit against the previous owner.  I would then try to verify that there had been heavy rains in the area just prior to the time of the neighbor’s report.  Your local weather bureau should be able to help out here.

2.   Try to find out who did the repair work for the previous owner and get copies of the work orders.  Maybe the neighbor can help here.

3.   Hopefully you kept the used can of hydraulic cement.  Take pictures of the can, and label the photos with the date you found it – and continue to hold on to the can.  Take pictures of any damaged items you removed from your basement if you still have any left.

If the house had a sump pump, that was a give-away that there had been a previous problem; otherwise, there would have been no need for a sump pump in the basement.  I am also hopeful that you had a home inspection done before you purchased.  If so, did the home inspector comment on anything related to your problem?  A good home inspector is trained to look for potential previous problems for a situation like yours.  If there was “any” evidence of “any” previous standing water in the basement and the inspector missed it, check out his Errors and Omissions insurance coverage.

You did not mention the age of your home.  If it is less than, say, ten years old, check out the laws in Iowa for the limit on a builder’s liability for structural defects, i.e., was the basement water-proofed?  It’s possible that if the age of your home falls within any statutory period that (hopefully) is covered in Iowa … and if the builder is still solvent … you could get some relief here.  This could be a long-shot, but it’s worth investigating.

Last, but certainly not least, I strongly recommend you take all your “evidence” to a good, reputable attorney and get legal advice and proceed from there.

Good luck to you, and feel free to write again if you have additional questions.

Regards,
Elizabeth