Seller disclosures can be a highly litigated and misunderstood aspect of real estate transactions. Whether you’re buying or selling a home—or advising someone who is—understanding your rights and responsibilities around disclosures can help you avoid costly disputes. These FAQs answer key questions about seller’s disclosure issues and provides legal insight into how to navigate them wisely.
What is a seller’s disclosure, and why does it matter?
A seller’s disclosure is a document (or set of documents) in which the seller discloses known material defects or conditions affecting the property. The purpose is to ensure transparency in the transaction, allowing the buyer to make an informed decision. Depending on state law, these disclosures can cover a wide range of issues, from roof leaks to foundation problems, to pest infestations or environmental hazards.
Failing to disclose known defects can expose sellers to liability for misrepresentation, fraud, or breach of contract, even after the transaction closes.
Is a seller legally required to provide disclosures?
It depends on the jurisdiction. In many states—including both Missouri and Kansas—disclosure requirements differ slightly but follow a similar general principle: Sellers must disclose known material defects that are not readily observable by a buyer.
Real estate sales are often governed by the doctrine of caveat emptor (buyer beware), but a seller who actively conceals defects or makes misrepresentations can be held liable. See Hess v. Chase Manhattan Bank, 220 S.W.3d 758 (Mo. 2007)
Any requirement to complete a formal disclosure form is contractual, not statutory. In other words, although Kansas and Missouri do not have statewide statutory requirements, custom contracts can modify disclosure expectations. Additionally, sellers must always avoid fraud or intentional concealment, regardless of the formal disclosure requirements.
What counts as a “material defect”?
A material defect is any issue that could significantly affect the property’s value, safety, or habitability. Common examples include:
- Structural problems (e.g., foundation cracks, roof damage)
- Water damage or mold
- Termite or pest infestations
- Lead paint or asbestos
- Plumbing or electrical issues
- History of flooding or drainage problems
Whether something is “material” is often judged by whether a reasonable buyer would want to know about it before proceeding with the purchase.
What happens if a seller fails to disclose a known defect?
If a seller knowingly withholds material information, they can be held liable for fraudulent nondisclosure. Depending on the issue that is discovered, buyers may have the right to:
- Rescind the contract
- Sue for damages
Courts may award repair costs, diminution in property value, or even punitive damages in egregious cases. Some of the key factors are whether the seller knew about the defect and whether the buyer reasonably relied on the omission when deciding to buy the property.
What about defects the seller genuinely didn’t know about?
Generally, sellers are not responsible for unknown defects, especially if they had no reason to suspect the issue. However, this can get murky. Courts will consider whether the seller “should have known” about the problem—for example, recurring water stains that were painted over but never investigated. Stechschulte v. Jennings, 297 Kan. 2, 298 P.3d 1083 (2013).
A best practice for sellers is to err on the side of disclosure. Saying “I don’t know” when you actually do—or choosing not to investigate a likely issue—can look suspicious and potentially backfire.
Can a seller be liable for misrepresentations made by a real estate agent?
It depends. If the agent is acting on behalf of the seller, and they make inaccurate statements to the buyer, the seller could be held liable under agency law principles. This is particularly true if the seller knew the agent’s statement was false and did nothing to correct it.
For example, if a listing agent says, “The basement has never flooded,” and the seller knows this is untrue, courts may treat the misstatement as coming from the seller directly.
What should buyers do to protect themselves?
Buyers should not rely solely on the disclosure form. Instead, they should:
- Conduct a professional inspection. Always hire a licensed inspector to evaluate the property.
- Ask follow-up questions. If something on the disclosure is vague or incomplete, request clarification.
- Document everything. Communications, repair invoices, and inspection reports may be critical if a dispute arises.
If a buyer suspects a defect has been concealed, they should consult a real estate attorney before closing, or as soon as an issue is discovered afterward.
Can disclosure obligations be waived?
Some contracts include an “as is” clause, which may limit the seller’s liability. However, courts often hold that “as is” language does not protect sellers who intentionally conceal defects or commit fraud. See Brennan v. Kunzle, 22 Kan. App. 2d 809 (2007)
Also, some issues—such as lead-based paint disclosures in homes built before 1978—are governed by federal law and cannot be waived.
How can sellers protect themselves?
Sellers should:
- Complete the disclosure form honestly and thoroughly.
- Disclose, don’t diagnose. If you’re aware of a leak, disclose the leak—even if you think it’s fixed. Let the buyer investigate further.
- Keep records. Save repair invoices, inspection reports, and contractor notes that show you acted in good faith.
- Work with an attorney when in doubt. A brief legal consultation can prevent years of litigation.
For information on what to do if you discover disclosure issues after purchasing a property, refer to our blog article titled, “Dealing with Undisclosed Issues After Purchasing a Property.”
Final Thoughts: When in Doubt, Disclose
Seller’s disclosure is not just a paperwork exercise—it’s a legal safeguard that protects both parties. Transparency builds trust, avoids future disputes, and can even help the sale go through faster. Whether you’re a seasoned investor, a first-time seller, or a professional advising clients, the golden rule remains the same: When in doubt, disclose.
If you have questions about a particular transaction or disclosure form, consult with Hunter Law Group early early. Prevention is almost always less expensive than litigation.