Vol. 75, No. 5, May
Residential Real Property Disclosure Duties
Like homeowners, brokers and home inspectors now
owe duties under various circumstances to disclose defects or conditions
that may affect residential real property transactions. Recission is not
a buyer's sole remedy when these duties are breached.
by Mark R. Hinkston
n 1992 Wisconsin became one of the first states to
require residential property owners to disclose property defects in
conjunction with a sale.1 The Wisconsin
Legislature subsequently enacted other laws mandating disclosure under
certain circumstances by real estate brokers and home inspectors.
Although these parties' obligations differ in some respects, the
Legislature's goal in creating disclosure standards for them was the
same: to ensure disclosure of property conditions that adversely impact
a property's value or structural integrity or that pose a health or
safety risk. Consequently, homeowners, brokers, and home inspectors face
liability for failing to disclose defects or adverse conditions relating
to property. This article discusses the disclosure duties of each of
these parties in the residential real estate context and the liability
they face when the duties are breached.
Background. Traditionally, Wisconsin real estate
sellers had no duty to disclose information to the buyer in an arm's
length transaction.2 In 1961 the Wisconsin
Supreme Court signaled the demise of this once-hallowed doctrine of
caveat emptor ("let the buyer beware") when it called it an
"obnoxious legal cliché."3 Over the
ensuing years, the Legislature and courts whittled away at the doctrine
and carved out exceptions. For example, the doctrine did not apply when
the seller actively concealed a defect, hindered a buyer's
investigation, or was untruthful when asked about a property
The Wisconsin Legislature sounded the death knell for caveat
emptor when it promulgated Wis. Stat. chapter 709, titled
"Disclosures by Owners of Residential Real Estate," which went into
effect on Sept. 1, 1992. The disclosure law requires owners of
residential property (of four or fewer dwelling units) to disclose in
conjunction with the property's transfer (whether by sale, exchange, or
land contract), "defects" in the property. The disclosure is to be made
via a written report provided within 10 days of a buyer's
An August 1992 Wisconsin Lawyer article hailed chapter 709's
enactment and explained its content.6 Since
then, as sellers and their brokers and attorneys have put the disclosure
law's mandates into practice, various issues have arisen from the
statute's now routine application in real estate transactions.
Significant among these are:
1) What is the nature and extent of defects or conditions that must
2) Is rescission the only remedy for a seller's nondisclosure or
3) May a buyer waive the right to rely on a seller's
4) Under what circumstances should a seller rely on a third party
(such as a broker or attorney) to satisfy his or her disclosure
Defects: Conditions Significantly Affecting Value, Impairing
Safety, or Shortening the Normal Life of the Premises. Chapter
709 provides a mandated form containing queries relating to 27 different
structural systems, property conditions, and legal status issues.7 The owner must disclose whether he or she is aware
of defects in the following: roof; electrical, plumbing, and heating/air
conditioning systems; well; septic system; basement or foundation
(including cracks, seepage, or bulges); structure; mechanical equipment;
and fireplace. The owner also must disclose whether the property: 1) is
serviced by a joint well; 2) is located in a floodplain; 3) has fuel
storage or "LP" tanks on it; 4) is contaminated by toxic or hazardous
substances or asbestos; or 5) is infested by termites or carpenter
Some of the disclosures relate to legal issues, such as whether the
property is in need of repairs to comply with applicable regulations;
the subject of a property line dispute, tax increases, property
reassessment, pending special assessment, zoning violations, or
easements; the site of a proposed public project; or designated as a
historic site. A "catch-all" inquiry requires identification of "other
defects affecting the property." Owners must explain all "yes"
Under chapter 709, "defect" is defined as "a condition that would
have a significant adverse effect on the value of the property; that
would significantly impair the health or safety of future occupants of
the property; or that if not repaired, removed or replaced would
significantly shorten or adversely affect the expected normal life of
the prem-ises."8 The vast majority of
defects requiring disclosure are structural and easily identifiable. For
example, most cases deal with calamities such as water seepage, cracks
in the foundation or walls, rot, or termites.
Although the Wisconsin Legislature attempted to cover virtually every
conceivable defect scenario via its form, there is no reference in
chapter 709 to conditions associated with property that was the site of
traumatic events, such as a murder or other criminal activity, suicide,
or even alleged haunting by ghosts. While some states mandate disclosure
in conjunction with the sale of such "stigmatized" or "psychologically
impacted" properties,9 it is unlikely that
the Wisconsin Legislature intended to mandate owner disclosure of such
conditions. Wisconsin brokers are not required to disclose that a
property was the site of a specific act or occurrence if it had no
effect on the property's physical condition or structures.10 While Wisconsin appellate courts have yet to
consider whether sellers should disclose such conditions,11 it is likely that buyers will bring such
scenarios before Wisconsin courts to hone the concept of "defect" unless
the Legislature amends chapter 709 to address such conditions.
Remedies: Not Just Rescission. Under chapter 709, a
buyer has a right to rescind a transaction in four preclosing
situations: 1) if the disclosure report is not received from the seller
within 10 days; 2) if the report discloses a defect; 3) if the report is
incomplete; or 4) if an amended report discloses a defect.12 Although other states' disclosure laws provide
remedies other than rescission for violations,13 Wis. Stat. section 709.05(4) provides that
"[t]he right to rescind under this section is the only remedy under this
But "giving the house back" is not the only remedy deceived buyers
have for nondisclosure claims based on common law causes of action (such
as misrepresentation) or the violation of statutes other than chapter
709. The Wisconsin Court of Appeals has noted that "it would make no
sense" to restrict defrauded home buyers to rescission and deprive them
of the right to monetary damages.14 As
such, buyers have asserted claims such as breach of contract/warranty
and misrepresentation. Recently, buyers have increasingly resorted to
two statutes with some teeth: Wis. Stat. sections 895.80 ("Property
damage or loss") and 100.18 ("Fraudulent representations").
Section 895.80 provides a cause of action against one who engages in
intentional conduct that causes damage. A prevailing plaintiff is
entitled to treble damages and reasonable investigation and litigation
costs,15 which courts have ruled include
attorney fees.16 The statute provides a
civil remedy for a violation of section 943.20 ("Theft by fraud"), which
provides in part that it is illegal for one to obtain title to property
through intentional deception. In the context of real estate transfers,
a seller may be held liable if it is found that he or she fraudulently
obtained buyers' purchase money by inducing a purchase by
misrepresenting a property's condition.17
Section 100.18 prohibits "untrue, deceptive or misleading"
communications to the public, including those made in conjunction with
real estate sales. The statute "intends to protect the public from all
untrue, deceptive or misleading representations made in sales
promotions, including representations made in face-to-face sales where
no media advertising is involved."18 The
statute affords plaintiffs double damages and attorney fees.19
Upon discovery of an undisclosed defect or condition, buyers
sometimes assume that the nondisclosure is prima facie evidence of
misrepresentation or a violation of sections 895.80 and 100.18. It is
not that easy. A buyer must present evidence that the seller knew or
should have known of the severity and duration of the alleged
condition.20 Liability is precluded if an
owner has no knowledge of an error or omission, or if the error or
omission was caused by relying on one of the third parties specified in
section 709.02.21 Also, a mere difference
between the real estate condition report and the property's actual
condition is insufficient to prove misrepresentation.22
The double and treble damages hammers of sections 895.80 and 100.18
are ominous, especially since the damages to be multiplied are either:
1) the difference between the property's actual fair market value (with
disclosure of the defect) and the fair market value of the property as
represented; or 2) the cost of remedying the defect.23 Plaintiffs also may seek punitive damages. Thus,
sellers who ruminate over whether to tell buyers about their "leaky
basement" or other defects should remember that the penalty for
deception is much stiffer than getting the house back. The specter of
double or treble damages, attorney fees, and punitive damages should
make sellers think twice about their disclosure duties.
Waiver: The Lambert Lesson. Buyers may
waive the right to rescind under chapter 709 in writing or by proceeding
to closing.24 A buyer also may waive
recovery on a misrepresentation claim for nondisclosure of defects when
the buyer proceeds to closing after the defects were identified in the
condition report. For example, in Lambert v. Hein,25 the buyers sued the seller on claims including
misrepresentation and breach of warranty arising out of basement water
problems. The condition report disclosed basement dampness. The sellers,
sellers' broker, and buyers obtained inspections confirming the water
problem. The buyers nonetheless proceeded with closing, despite
knowledge of the problem, but reserved the right to require the sellers
to place the real estate into the condition disclosed in the condition
The court of appeals affirmed the trial court's rejection of the
buyers' claims on the ground that the buyers had waived their right to
pursue the claims by proceeding when they had knowledge of the defects,
despite the reservation of rights. As to the warranty claims, the court
emphasized that the buyers failed to exercise their contractual option
to disapprove the sellers' condition report and the fact that the buyers
obtained their own inspection. As to the misrepresentation claim, the
court noted that "when a buyer learns that a misrepresentation has been
made prior to closing, the buyer is no longer deceived and, as a matter
of law, can no longer rely upon the prior misrepresentation."26
The court of appeals subsequently has found that buyers waive their
right to assert a misrepresentation claim by closing despite an "as is"
clause.27 Buyers also may waive their
rights by proceeding to close without complaining of "open and obvious"
defects.28 The lesson from Lambert
and other waiver cases is that buyers who fail to exercise disapproval
clauses and the statutory right to rescind after receipt of the
condition report, who fail to heed inspectors' advice, who ignore "as
is" clauses, or who turn a blind eye to "open and obvious" defects waive
their right to later pursue claims for a seller's failure to disclose
Blaming Other Parties: Brokers and Attorneys as
Targets. The Legislature recognized that sellers may need to
defer to experts to identify the existence, nature, and extent of
defects. Thus, under chapter 709, a seller may substitute for any
required entry in the disclosure report information supplied by a
licensed engineer, land surveyor, structural pest control operator,
qualified third party as defined by Wis. Stat. section 452.23(2), or a
contractor about matters within the scope of a contractor's occupation.
An owner will not be liable if an error or omission in a condition
disclosure report is based on information provided by any of these
parties.29 But what happens when sellers
turn to their broker or attorney for advice with respect to disclosure
of defects? Brokers and attorneys may find themselves in precarious
situations when they give practical advice on filling out the disclosure
"My Broker Made Me Do It." Chapter 709 gives brokers
relief by decreasing their exposure in their role as a conduit between
seller and buyer. Buyers get representations straight from the seller,
lessening the chances of nondisclosure due to seller-to-broker
miscommunication. But this does not stop some sellers from blaming their
broker when buyers allege misrepresentation.
Sometimes sellers think that a defective condition need not be
disclosed because their broker "told us we didn't have to disclose
that." But sellers cannot use their broker as a shield. For example,
assume this hypothetical: In 1992 homeowners discover basement water
seepage. It comes and goes over the ensuing years. In 2002 they decide
to sell and tell their broker of the seepage. Even though it constitutes
a defect or material adverse condition, they ask the broker not to
disclose it. What should the broker do?
There are three reasons the broker should disclose the seepage,
regardless of client loyalty. First, if the seepage is a "material
adverse fact" that cannot be discovered by a buyer's "reasonably
vigilant observation," the broker is under a duty to disclose it.30 Second, Wis. Stat. section 452.133 mandates
broker disclosure because the sellers' request that the broker not
disclose the seepage is a "material adverse fact" in that it reflects
that the seller "does not intend to meet his or her obligations under a
contract or agreement made concerning the transaction."31 Finally, brokers have a duty to disclose
information that is inconsistent with condition report
The only time a seller client is "off the hook" and can legitimately
blame the broker is if the broker made a misrepresentation without the
seller's knowledge. However, the seller may be liable if the seller
knows or should know of the misrepresentation and does nothing about it
or the broker repeats a misrepresentation made to him or her by the
"My Attorney Made Me Do It." Homeowners often
consult with an attorney in conjunction with a sale. While attorneys
performing legal services are not subject to the rules governing
brokers,34 attorneys still must be cautious
about the extent of their involvement in disclosure decisions. Many
sellers have questions about the purpose of the condition report, the
statute mandating it, and the report form's language. Many sellers also
ask attorneys whether a condition is a defect that should be disclosed
on the report form. This may put an attorney in an uncomfortable
For example, what if a client asks an attorney whether basement
seepage encountered in 1992 should be disclosed? The attorney says it
should. The clients ignore the advice and submit the form without
disclosing the seepage. Does the attorney have an ethical obligation to
inform the buyer of the nondisclosure? Supreme Court Rule 20:4.1, which
requires an attorney to disclose "a material fact to a third person" to
avoid assisting a client's fraud, mandates informing the buyer. The
attorney is not bound to confidentiality if the client's nondisclosure
constitutes a fraudulent act that may result in "substantial injury" to
a buyer's financial interest.35
Brokers' Duties of Disclosure and Inspection.
Although enactment of chapter 709 took pressure off brokers by placing
the disclosure onus on sellers, brokers have long had a common law duty
to not mislead or deceive purchasers.36 In
1994 brokers became subject to specific statutory disclosure
requirements. Pursuant to Wis. Stat. section 452.133, a broker must
disclose to each party all material adverse facts that the broker knows
and that the other party does not know or cannot discover through
reasonably vigilant observation, unless the disclosure of a material
adverse fact is prohibited by law.37
Brokers are required to conduct "a reasonably competent and diligent
inspection" of the property to detect observable, material adverse
facts. A broker who becomes aware of information suggesting the
possibility of material adverse facts is to disclose the information to
the parties in writing, recommend that the parties obtain experts to
investigate and, if asked by the parties, draft appropriate inspection
contingencies. A broker's disclosure obligation includes the property's
condition and other material adverse facts in the transaction.38
"Adverse fact" is a condition or occurrence that significantly and
adversely affects the property's value, significantly reduces the
structural integrity of improvements, or presents a significant health
risk to the property's occupants. "Material adverse fact" is an adverse
fact that is of such significance that it affects a party's decision to
enter into a real estate contract or affects a party's decision as to
the terms of such contract.39
Reliance on Qualified Third Party. Although a broker
is not required to retain an inspector,40 a
broker isrelieved from the duties to inspect or disclose property
condition information when an inspector is retained.41 If a broker retains an inspector, the broker may
rely on the inspection results if he or she delivers the inspection
report to all parties.42 But the report
does not absolve the broker. The broker still must disclose all facts
known by the broker that contradict any information in the seller's
disclosure report or the inspector's report.43
Broker Liability. As with sellers who fail to
disclose a defect or engage in misrepresentation, brokers also face
liability to buyers. For example, a broker may be liable for
misrepresentation when he or she makes a positive representation about
an aspect of the property even if the property is sold "as is."44 Claims also have been asserted against brokers
under Wis. Stat. section 100.18.45 But that
statute only applies to brokers when they have directly made a
representation or statement of fact with the knowledge that it is
"untrue, deceptive or misleading."46
Although double damages are available against a broker, the statute
excludes recovery of attorney fees from a broker.47
Brokers are not absolute guarantors of seller disclosure. While they
certainly are in a better position than buyers to ascertain defects,
their involvement does not make them an automatic target. The buyer
still must prove that the broker, in a case where he or she did not
defer to a third-party inspector, failed to disclose a material adverse
fact that could not be observed by a buyer's "reasonably vigilant
Home Inspector Duties
Home Inspector Act and Regulations. Home inspectors
have experienced a boon. Many homebuyers now insist on a home inspection
contingency.48 More sellers and brokers
defer to inspectors to fulfill their disclosure duties,49 and mortgage lenders more frequently are
Some commentators have clamored for mandatory home inspection
legislation.50 That day has not come in
Wisconsin and the vast majority of other states. Yet the Wisconsin
Legislature recognized that the profusion of residential real estate
inspections created a need for regulation. Thus, the legislature enacted
statutes in 1997 governing home inspectors.51 The Home Inspector Act requires inspector
registration and outlines the parameters for inspections, reports, and
liability. The Department of Regulation and Licensing has also
promulgated practice standards for home inspectors.52
Scope of Inspection and Report. A home inspector's
focus is on "observable systems and components of improvements to
residential real property that are readily accessible."53 Although the inspector is to conduct a
"reasonably competent and diligent inspection" to detect "observable
conditions," the inspection is not required to be "technically
A home inspector is required to inspect virtually every component in
a residence, including foundations, roofs, plumbing, heating and
electrical systems, insulation, and ventilation. The regulations outline
standards for inspection of these items.54
The inspector is not required to enter dangerous areas on the property;
move objects that obstruct visibility; inspect for rodents, underground
items, or hazardous substances; or disassemble any component, except to
remove access panels normally removed by an occupant.
Home Inspector Disclosure: "Material Adverse Facts."
After conducting the inspection, the inspector is required to submit a
report to the client that describes the condition of inspected items and
discloses those conditions "that, if not repaired, will have a
significant adverse effect on the life expectancy of the identified
item." The inspector also must disclose "any material adverse facts"
that the inspector has knowledge of or has observed.55 The inspector's duty differs from a broker's
duty in that the inspector must disclose facts regardless of whether
they can be observed by a buyer's "reasonably vigilant observation."
"Material adverse fact" under the Home Inspector Act is a condition
or occurrence that significantly reduces "the functionality or
structural integrity of components or systems" or poses "a significant
health or safety risk to occupants."56 This
definition of "material adverse fact" differs from that applicable to
brokers.57 Although both contain the
structural integrity and health risk facets, the home inspector's
definition does not subsume conditions "adversely affecting the value of
the property." Indeed, an inspector may not report as to the market
value or marketability of a property or whether a property should be
The inspector is not required to offer a warranty or guarantee of any
kind or to predict future conditions, including the potential for
failure of a component, and is not required to report on an item's life
expectancy, the reason for the necessity of a major repair, or suggested
repair methods. The inspector is not required to retain inspectors to
investigate any "material adverse facts" the inspector has knowledge
Home Inspector Liability. The Wisconsin Court of
Appeals has held that a real estate appraiser not in privity with a
buyer may be liable for a negligent appraisal.60 Although a home inspector's liability is limited
to the parties "to the transaction for which the home inspection is
conducted,"61 Wisconsin appellate courts
have not ruled on whether, and under what circumstances, a seller's home
inspector may be held liable to a buyer. However, the precedent of
appraiser third-party liability and the analogous relationship between
appraisers and inspectors make it conceivable that a seller's negligent
home inspector may face liability to a buyer if the seller consented to
release of the inspection report. In any event, inspectors may not
circumvent this potential liability by including a liability disclaimer
in their contracts or reports.62
Home inspectors have more procedural insulation from liability than
sellers or brokers. An action against a home inspector must be initiated
within two years after the inspection. This period may not be reduced by
agreement.63 The two-year limitation period
is a victory for home inspectors. Making the trigger point the date of
inspection completion rather than discovery is also a victory because
many undisclosed defects or conditions may not be discovered for
Because of the Home Inspector Act's recent vintage, it has not yet
been the subject of appellate court interpretation. But issues certainly
will arise as the statute's mandates are put into practice. For example,
what if a client, knowing of a crack in the foundation and consequent
seepage, tells an inspector to exclude that information from a report?
The home inspector has a predicament. A home inspector is normally
required to report "water penetration."64
However, the regulations allow inspectors to exclude a component, such
as the foundation, from inspection if requested to do so by the
client.65 But honoring the client's
nondisclosure request seems to contravene the inspector's duty to report
"any material adverse facts that a home inspector has knowledge
Hinkston, Creighton 1988 cum laude, practices business
litigation with Knuteson, Powers & Wheeler S.C., Racine. He is
admitted to practice in Wisconsin, Missouri, Kansas, and Colorado. You
can reach him at email@example.com.
A home inspector is prohibited from providing an inspection report to
a third party without the client's consent.67 What if the client, not happy with the many
defects disclosed in a report, decides to conceal the report from
buyers? The home inspector statutes and regulations appear to impose no
duty on an inspector to rectify the concealment by notifying the buyers.
Conversely, if a client requests that a report be turned over to a buyer
and the inspector refuses to do so, the inspector may face disciplinary
Obviously, the possibility that an inspector will misrepresent a
property's condition is more remote than the possibility that a seller
or broker will engage in such activity. The seller and broker,
compensated by sale proceeds and commissions respectively, generally
would have more financial motive than the inspector, paid a flat fee or
by the hour. But in the improbable but possible circumstance in which a
rogue inspector does conspire with a seller, broker, or lender, a
plaintiff contemplating legal action must be aware of the stringent
statute of limitation, the early trigger date, and the mandate that
liability only extends to parties to the transaction.
Purchasing a home is a big event rife with emotion. At the first sign
of post-closing dampness, flood, rot, or termites, that "nice couple who
sold us the house, their great broker, and that diligent home inspector"
can instantly become, in the eyes of disgruntled buyers, "those lying
scoundrels who ripped us off." The buyers may be inclined to assume that
all of these parties breached their disclosure duties. Understanding the
respective duties and standards applicable to the players in residential
sales affords buyers and their attorneys a more logical approach to
analyze whether, and against whom, a claim may lie.
Attorneys counseling sellers should encourage overdisclosure rather
than underdisclosure, promote third party expert inspections, urge
clients to fill out the condition reports based on the clients' personal
knowledge, and never countenance misrepresentation. Sellers who are
aware of their disclosure duties and who heed their attorney's advice
via full disclosure can drive away from the closing with peace of mind.
Buyers who take advantage of an inspection contingency, follow up on
suspected defects, use inspection experts, and close only after being
convinced that all known or discoverable defects have been disclosed,
can sleep well at night in their new home. If there are undisclosed
defects that manifest later, Wisconsin's laws governing the conduct of
owners, brokers, and home inspectors provide some solace and remedy.
11991 Wis. Act
162. A majority of states have followed suit by mandating seller
2 Ollerman v.
O'Rourke Co., 94 Wis. 2d 17, 29, 288 N.W.2d 95, 101 (1980).
3 Pines v.
Perssion, 14 Wis. 2d 590, 596, 111 N.W.2d 409, 412 (1961).
Ollerman, 94 Wis. 2dat 30-31, 288 N.W.2d at 102.
5 Wis. Stat.
§§ 709.01(1), .02. Excluded from the disclosure requirements
are transfers of properties that have never been inhabited, those exempt
from the real estate transfer fee, and transfers made by certain
fiduciaries. Wis. Stat. § 709.01(2).
6 Debra Peterson
Conrad, Truth or Consequences? Residential Seller Disclosure
Law, Wis. Law., Aug. 1992, at 9.
7 Wis. Stat.
§ 709.03. Note that the buyer may waive the right to receive the
form. Wis. Stat. § 709.08. To access the form online, go to
www.wisbar.org and click on WI Statutes under the Legal Resources
heading on the left side of the page.
8 Wis. Stat.
Robert W. Washburn, Residential Real Estate Disclosure
Legislation, 44 DePaul L. Rev. 381, 447-48 (1995); Daivia S.
Kasper, Ohio's Homeowner Disclosure Law, 45 Case W. Res. L.
Rev. 1149, 1178 (1995).
10 Wis. Stat.
§ 452.23. Brokers are also not required to disclose that a
particular person is registered as a sex offender, unless a client
requests such information. See Wis. Stat. §§
452.23(2)(d), .24(1). The broker is immune from liability for disclosure
of said information if he or she provides written notice that the person
may obtain sex offender registry information from the department of
corrections. Wis. Stat. § 452.24(2).
11 But see
Green Spring Farms v. Spring Green Farm Assoc. Ltd. Partnership,
172 Wis. 2d 28, 492 N.W.2d 392 (Ct. App. 1992) (affirming denial of
seller's motion for summary judgment in case involving failure to
disclose salmonella contamination on farm).
12 Wis. Stat.
§§ 709.02, .05.
supra n. 9, at 1165.
v. Horst, No. 00-0933 (Wis. Ct. App. Apr. 10, 2001) (unpublished
15 Wis. Stat.
e.g., Stathus, No. 00-0933 (buyers alleged claim for
misrepresentation under Wis. Stat. § 895.80 arising out of
nondisclosure of basement water problems and underground spring).
18 Grube v.
Daun, 173 Wis. 2d 30, 57, 496 N.W.2d 106, 116 (1992).
19 Wis. Stat.
v. Ade, No. 98-1406 (Wis. Ct. App. Oct. 14, 1998) (unpublished
21 Wis. Stat.
Schmelzle, No. 98-1406.
23 Wis. JI -
Civil 2405 ("Intentional Misrepresentation: Measure of Damages in
Actions Involving Sale [Exchange] of Property (Benefit of the
24 Wis. Stat.
v. Hein, 218 Wis. 2d 712, 582 N.W.2d 84 (Ct. App. 1998) (review
at 732, 582 N.W.2d at 92 (quoting Foss v. Madison Twentieth Century
Theaters Inc., 203 Wis. 2d 210, 218-19, 551 N.W.2d 862, 865-66 (Ct.
App. 1996)). See also Walker v. O'Brien, No. 00-3046
(Wis. Ct. App. Nov. 20, 2001) (unpublished opinion) (holding that buyers
waived claims arising out of sellers' failure to disclose basement water
seepage when they closed transaction with knowledge of the defects
obtained from independent inspector).
27 Lunde v.
Chase, No. 98-0716 (Wis. Ct. App. Jan. 6, 1999) (unpublished
opinion) (holding that buyers waived their claims by proceeding to close
when sellers had disclosed 13 of 28 different defects on condition
report and added the words "Sold: AS IS" on report).
e.g., Moilanen v. Nippoldt, No. 96-1293 (Wis. Ct. App.
Nov. 9, 1996) (unpublished opinion) (denying recovery to buyers when
sagging floor and malfunctioning patio door, despite not being
identified in condition report, were so "open and obvious" that there
could be no reasonable or justifiable reliance on representations in
29 Wis. Stat.
§§ 709.02, .07.
30 Wis. Stat.
31 Wis. Admin.
Code § RL 24.02(1)(b) (definition of "adverse fact").
32 Wis. Admin.
Code § RL 24.07(6).
33 Wis. Stat.
Wis. Stat. § 452.01(3)(h) ("Broker" does not include "[a]ttorneys
licensed to practice in this state while acting within the scope of
their attorney's license").
36 Lien v.
Pitts, 46 Wis. 2d 35, 46, 174 N.W.2d 462, 468 (1970).
37 An example of
information that may not be disclosed is a seller's minimum sale price.
Wis. Admin. Code § RL 24.07(2).
38 Wis. Admin.
Code § RL 24.07.
39 Wis. Admin.
Code § RL 24.02(1), (12).
40 Wis. Admin.
Code § RL 24.07(1)(d).
41 Wis. Stat.
§ 452.23(2)(c); Wis. Admin. Code § RL 24.07(5). See also
Conell v. Coldwell Banker Premier Real Estate Inc., 181 Wis. 2d
894, 900, 512 N.W.2d 239, 242 (Ct. App. 1994).
42 Wis. Admin.
Code § RL 24.07(5)
43 Wis. Admin.
Code § RL 24.07(6).
44 See Grube
v. Daun, 173 Wis. 2d 30, 496 N.W.2d 106 (1992).
at 62-63, 496 N.W.2d at 118.
46 Wis. Stat.
47 Wis. Stat.
48 Alan J.
Heavens, Home Inspector Popularity Increasing, Milw. J. Sent.,
Nov. 8, 1999.
49 Although not
expressly referenced, it is presumed that home inspectors would be
included within the category of individuals to whom sellers and brokers
may defer in satisfying their disclosure obligations (pursuant to Wis.
Stat. §§ 709.02 and 452.23(2)(c)). The exclusion is likely due
to the fact that the Home Inspector Act was promulgated after the seller
and broker disclosure statutes went into effect.
supra n. 9, at 453.
51 1997 Wis. Act
81, Wis. Stat. § 440.97 et seq.
52 Wis. Admin.
Code § RL 134.01 et seq.
53 Wis. Stat.
§§ 440.97(4), .975(2); Wis. Admin. Code § RL
54 Wis. Admin.
Code § RL 134.03.
55 Wis. Stat.
§ 440.975(3); Wis. Admin. Code § RL 134.04(1)(e).
56 Wis. Admin.
Code § RL 131.02(17).
supra n. 39.
58 Wis. Admin.
Code § RL 134.04(3)(a)-(b)
59 Wis. Admin.
Code §§ RL 134.02(2)(a), (2)(j), .04(2)(a)-(c), (4).
60 Costa v.
Neimon, 123 Wis. 2d 410, 414, 366 N.W.2d 896, 899 (Ct. App.
61 Wis. Stat.
62 Wis. Stat.
63 Wis. Stat.
64 Wis. Admin.
Code § RL 134.03(8)(a)6.
65 Wis. Admin.
Code § RL 134.02(3)(b).
66 Wis. Admin.
Code § RL 134.04(1)(e).
67 Wis. Stat.
68 Wis. Stat.