Expert: Diann Tonnesen - 5/11/2009

Question
Hi, I recently purchased a home last November (2008). There are holding tanks in my front yard to which I thought were originally my tanks for the septic system. I came to find out that the tanks belong to the bar right next door to my home.

I looked more into this and found that the properties were owned by the same person at one time and he sold the bar and there is now a 100 year contract or settlement for the tanks to remain on this property.

This was never disclosed at the time of purchase.

If I wanted to pursue this any further - is there anything that could be done?

Answer
Hi Devan,

You really need to look at your paperwork closely first to make sure that there was absolutely no mention of these tanks in anything you were previously given - preliminary title reports, real property disclosures, etc. It is likely that this contract for the tanks to remain on the property were in your preliminary title report. Were you given a copy of the prelim prior to closing? But to my way of thinking, something this important that impacts the property should probably should have been disclosed in the seller's real property disclosure as well. This is what we call a "material fact" that affects the property and it certainly should have been disclosed to you prior to closing.

You are probably going to need to consult a real estate attorney to get this squared away unless the previous seller is open to mediation. I don't know the laws of your state, but in Nevada it would seem you would have grounds for some sort of reimbursement. You need to have a few things clear in your own mind before you continue. What are you trying to accomplish? Complete removal of the tanks? Moving them to a different location? Rental income if they are left where they are? A reduction in your previous purchase price? Complete cancelation of the sale?

A question that might be asked in any future litigation would be why, if you didn't mind the tanks being there when you thought they were for your own septic, do you mind them now? So you need to have a coherent answer ready for that one (you intended to move/replace them, etc.) in order to prove that you have been harmed. Since they are for a commercial use there may be other health ramifications an attorney could advise you of.

Good luck in resolving this, and let me know what happens?!!