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My house in Oregon had water intrusion this winter. We later learned from a neighbor that this had happened several times to the previous owner who never told us anything about this. We are wondering if there is any basis for legal action, since we bought the house three years ago.

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You most likely have a cause of action (civil case) for breach of contract and fraud and should consult with an licensed attorney immediately.

Oregon is state that requires sellers to disclose multiple things in a standardized form. Unlike a caveat emptor state, the seller must disclose certain facts based on what they actually know. See O.R.S. § 105.464. Things that are not in the statute, do not have to be disclosed but the list is pretty broad and has a catch-all provision.

Under O.R.S. § 105.464(5)(G), the seller must answer the following question:

Are there any moisture problems, areas of water penetration, mildew odors or other moisture conditions (especially in the basement)? [ ]Yes [ ]No [ ]Unknown

*If yes, explain on attached sheet the frequency and extent of problem and any insurance claims, repairs or remediation done.

This section and is right on point. If what your neighbors say is true, and the sellers checked No or Unknown, it sounds like you have a cause of action.

As user6726 noted, you probably have two causes of action. First, is breach of contract, which under O.R.S. § 12.080(1), has a 6 year statute of limitations, but You are clearly within the 6 years. The second is a fraud claim, which under O.R.S. § 12.110(1), is two years from when the fraud is first discovered.

What "first discovered" means is probably an issue to be determined by a judge. It could be when you first noticed that there was a leak, but the better argument is that the 2 years begins from when your neighbor told you it was a problem the previous owner had. When you learned the previous owner knew about the problem it when you first discovered the fraud.

Again, the clock is ticking, so consult an attorney.

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There is a 6 year statute of limitations for contract cases, and for non-contract cases involving fraud or deceit, the two year "limitation shall be deemed to commence only from the discovery of the fraud or deceit".

[Addendum]

The seller's disclosure is required by ORS 105.465(2), and described in ORS 105.464. Item G addresses moisture problems. If that item is checked "unknown", then you would need to establish that the seller knew, and that could depend on whether the person selling is the person who lived there (e.g. if the house was sold by a trust on behalf of the occupant at the time).

  • Good point about knowing who sold the house! O.R.S. § 105.470 states that the disclosure requirements don't apply when the house is new and was never occupied. It also doesn't apply if the seller is a bank, trustee (or other court appointed representative), or government agency. See oregonlaws.org/ors/105.470 – Mr_V Jul 27 '16 at 17:17

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