MBE Rules · Real Property
Seller Disclosure
Seller disclosure duties
The rule
Modern law requires sellers of residential property to disclose known material latent defects; 'as is' clauses do not shield active concealment or misrepresentation.
In plain English
Sellers of residential properties must inform buyers about any significant hidden defects they know about. Even if a property is sold 'as is,' sellers cannot hide problems or lie about them.
Worked example
A seller knows that the roof has a significant leak but does not disclose this to the buyer, instead selling the house 'as is.' After the sale, the buyer discovers the leak and sues the seller for failing to disclose the defect. The court rules in favor of the buyer because the seller actively concealed a known defect.
Memory hook
Sellers must spill the beans on hidden defects, even in 'as is' sales!
The trap
Exams often include scenarios where students might confuse 'as is' clauses with a complete waiver of disclosure obligations, leading them to overlook the seller's duty to disclose known defects.
How examiners test it
Questions typically present a fact pattern involving a property sale with an 'as is' clause, testing whether students recognize the seller's obligation to disclose known defects despite the clause.
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