You have signed a contract to buy your home. At closing, you are instructed to sign a waiver of redhibition. Most often, your realtor will explain that this means you are buying the property “as is.” This is not necessarily the case. As discussed below, sometimes a waiver of redhibition can be overcome.
As a default, in Louisiana a seller warrants a buyer against redhibitory defects in the property. (LA. C.C. art. 2520). There is a significant amount of case law explaining what constitutes a redhibitory defect, however, it basically boils down to (1) defects that make the property useless or (2) defects that make use of the property inconvenient due to the need to make repairs.
Although redhibition is often an issue people associate with real estate transactions, it actually applies to all property, not just homes. Thus, purchasers of all sorts of property may benefit from redhibition.
Many transactions contain a waiver of redhibition through which a purchaser purportedly waives his or her right to recover damages for defective property. A waiver of redhibition is strictly construed and must contain a number of specific technical requirements that are codified in the Louisiana Civil Code. Even if the waiver meets these technical requirements, it will not be effective if the seller failed to disclose or misrepresented relevant information about the property to the seller. If you feel a seller made material misrepresentations prior to the purchase of property you should consult an attorney to discuss the specific facts of your case.
If you purchased defective property, you have several options if there is not an enforceable waiver. One option is that the seller may be required to return the purchase price. The seller may also be required to repair the defect. In other situations, the seller may be liable for the buyer’s expenses and attorney’s fees for bringing a judicial action to rescind the sale. The exact option that is best depends on the specific facts of the case.
The mere fact that property was sold in a defective condition does not entitle the purchaser to rescission or damages. A buyer may not be entitled to redhibition if he or she failed to provide notice to the seller or had preexisting knowledge of the defect. A seller’s rights and protections hinge on the specific facts of the case. With respect to notice, a seller may be entitled to repair the property. However, if seller knew about the defect but failed to disclose, he or she may not be entitled to notice or the option to repair the property. If the seller is entitled to notice and the purchaser incurs an unreasonable expense to repair the defect, the seller normally has to reimburse an amount that is reasonable under the circumstances. (La. CC art. 2522)
A seller may also not be liable for redhibition if the buyer knew or had reason to know of the defect before the sale. While knowledge is a fact-driven concept, the more obvious the defect the more likely a buyer will be found to have had knowledge. A seller may argue that the buyer would have had knowledge had he properly inspected the property. In certain transactions, the buyer may waive the right to inspect the property, which may also may also be an avenue to avoiding liability for redhibition. (La. CC art. 2521). In these cases, a realtor, broker, or agent may face liability for their failure to conduct certain inspections.
If you believe you are having an issue involving redhibition, contact us at (866) 970-0977 for a free case review.