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Supreme Court Rules on Disclosure
On July 21, the
Pennsylvania Supreme Court unanimously decided that a murder-suicide in a
property is not a material defect that a seller has to disclose to a buyer. The
history of
Milliken v. Jacono is well-known to REALTORS, click here for
details of the highly-publicized case.
The Supreme Court's
ruling contained several important points:
- The Court
commented that using a disclosure form that revealed more information about a
property than the law required does not create additional mandatory
disclosure requirements.
- The Court
stated that it was "not ready to accept that [a psychological stigma]
constitutes a material defect." The Court observed that requiring quantification
of the psychological impact of various traumatizing events would be a "sisyphean
task".
- It was
recognized the psychologically traumatic events do not result in defects to the
structure of the house; they do not affect the quality of real estate. It was
noted that it would be nearly impossible to assign a monetary value to
psychological stigma.
- Lastly, and
importantly for buyers' agents, the murder-suicide was absolutely not a latent
event. It was widely publicized in the local media and on the Internet, and it
was a well-known event within the neighborhood. The doctrine of caveat
emptor still survives and places the responsibility on the buyers to ensure
the property they are buying meets their needs. In the words of the Pennsylvania
Supreme Court, "Purely psychological stigmas are not material defects of
property that sellers must disclose to buyers".